AbbVie (ABBV.US) Q3 results beat expectations; two blockbuster new drugs contribute nearly half of revenue

AbbVie (ABBV.US) third-quarter results beat expectations, driven primarily by higher sales of immunology and neuroscience drugs. The company also raised its full-year earnings guidance and increased its quarterly dividend by 5.2%. Data showed that AbbVie's third-quarter revenue rose 10% year-over-year to $17.4 billion, above the $17.32 billion expected by FactSet analysts. Notably, Humira, once the world's top-selling drug, saw third-quarter revenue fall to $683 million, down 31.2% year-over-year (on a reported basis), as it continues to face pressure from biosimilar competition. However, the immunology segment did not shrink as a result, but completed a smooth handover between old and new productsthe segment's total revenue reached $9.17 billion, up 16.3% year-over-year. This was mainly driven by strong uptake of two successor drugs: Skyrizi and Rinvoq booked $5.78 billion and $2.71 billion, respectively, together contributing nearly half of the company's total revenue. In addition, the neuroscience portfolio's revenue grew 19.4% to $3.39 billion; oncology revenue edged up 0.8%; and aesthetics revenue declined 1.4%. Third-quarter net income was $4.22 billion, or $2.37 per share, compared with $186 million, or $0.10 per share, in the same period last year. The quarter's results were weighed down by $0.11 per share in acquired in-process research and development and milestone expenses, compared with a $1.50 per share drag in the same period last year. Adjusted earnings per share were $3.82, above the $3.73 expected by FactSet analysts. AbbVie raised its quarterly dividend by 5.2% to $1.82 per share. Raised full-year guidance AbbVie now expects full-year adjusted earnings per share of $13.95 to $13.99, up from its previous guidance of $13.76 to $13.96. Wall Street expects full-year adjusted earnings per share of $13.91. The company earlier this month lowered its full-year outlook to account for acquired in-process research and development and milestone expenses; in July it also cut its forecast to reflect the acquisition of Apogee Therapeutics. The deal, recently completed, brings AbbVie Apogee's experimental drug zumilokibarta potential competitor to Regeneron and Sanofi's Dupixent for the treatment of moderate-to-severe atopic dermatitis (the most common form of eczema).