Novo Nordisk's American depositary receipts climbed as much as 5.36% to $42.36 on Wednesday after the Danish drugmaker reported third-quarter results that exceeded analyst forecasts, driven by robust demand for its oral weight-loss treatment Wegovy. The stock's rebound trims a decline of more than 20% year-to-date through Tuesday's close.
The company posted adjusted sales of 79.2 billion Danish kroner for the quarter, a 6% increase year-over-year, while adjusted operating profit rose 27% to 31.72 billion kroner at constant exchange rates, beating expectations. The performance offers investors some reassurance as Novo seeks to defend its position against Eli Lilly in the increasingly competitive obesity drug market.
Wegovy pill sales exceed expectations
The oral formulation of Wegovy was the primary driver of the earnings beat. Sales reached 5.39 billion kroner ($810 million) in the third quarter, surpassing the 4.62 billion kroner analysts had projected, according to Reuters. That represents a 53% increase from the previous quarter.
Launched in the US in January, the pill is now available in eight markets, including Germany, the UK, and the United Arab Emirates. The company attributed the accelerated rollout to increased manufacturing output and faster regulatory approvals, and it now plans to launch the pill in more than 20 countries by mid-2027, pulling forward its previous target of the end of 2027.
Novo said the pill holds roughly 80% of the US oral obesity drug market across reimbursed, cash-pay, and telehealth channels, with approximately 90% share in the UK and 80% in the UAE. US demand was supported by a government program that allows eligible seniors to access obesity drugs for $50 a month, which Novo's US head credited with an approximately 20% quarterly increase in Wegovy pill volumes.
Outlook raised for third time this year
Novo raised its 2026 forecast for adjusted sales and operating profit growth to between a 2% decline and 2% growth at constant exchange rates, up from its previous projection of flat growth to a 6% decline. The company cited stronger volumes, particularly for obesity treatments, in both US and international markets, and it expects international sales to grow while US sales decline.
This marks the third time Novo has lifted its outlook this year, signaling progress after a period of declining sales and management changes. However, competition remains a significant challenge. Eli Lilly recently raised its own revenue outlook following strong demand for its injectable weight-loss treatments and is gaining traction with its rival oral drug, Foundayo.
Novo Chief Executive Mike Doustdar said the company had maintained its position despite Lilly's entry into the pill market. “We've been able to hold the baton,” he told Reuters, while acknowledging that Lilly was working hard to reverse the current market position.
Leadership changes and competitive pressures persist
Novo's recovery comes after its shares fell more than 70% from their peak, while Lilly's stock advanced. The Danish company had become Europe's most valuable listed company in 2023, with a market value exceeding $600 billion. The latest results have raised hopes that the company is stabilizing under its new leadership, though analysts continue to warn that competition in the obesity drug market is likely to intensify.
Novo also announced that Chief Financial Officer Karsten Munk Knudsen will leave at the end of December, with Luigi La Corte, currently finance chief at Galderma, succeeding him. Investors will be watching whether the Wegovy pill can sustain its growth and help offset weakness in injectable sales as Novo seeks to narrow the gap with Lilly.
This article is for informational purposes only and does not constitute financial advice.
