• Pfizer reported revenue and adjusted earnings that topped Wall Street's expectations, despite a sales decline driven by the lower demand for the company's Covid vaccine.
• The pharmaceutical giant reported first-quarter sales of $18.28 billion, down 29% from the year-earlier period.
• The New York-based drugmaker maintained its 2023 sales forecast of $67 billion to $71 billion.

Pfizer on Tuesday reported first-quarter revenue and adjusted earnings that topped Wall Street's expectations, despite a decline in sales driven by the lower demand for the company's Covid vaccine.

The pharmaceutical giant's stock closed slightly lower Tuesday at $39.06. Shares are down more than 23% year to date through Tuesday's close, putting the company's market value at around $220.47 billion. 

Here's what Pfizer reported compared with Wall Street's expectations, based on a survey of analysts by Refinitiv:

• Earnings per share: $1.23 adjusted vs. 98 cents expected 
• Revenue: $18.28 billion vs. $16.59 billion expected

Pfizer's net income of $5.54 billion, or 97 cents per share, fell from $7.86 billion, or $1.37 per share, during the year-earlier quarter.

The company reported first-quarter sales of $18.28 billion, down 29% over the same period a year ago.

Covid-related sales contributed $7.1 billion to that number. Pfizer raked in $3 billion in Covid vaccine revenue and $4 billion in sales of its Covid antiviral pill Paxlovid.

Looking ahead, the New York-based company maintained its 2023 sales forecast of $67 billion to $71 billion. Pfizer also reiterated its full-year adjusted earnings outlook of $3.25 to $3.45 per share.

But Pfizer continues to expect Covid-related sales to decline this year. The company reaffirmed its forecast of $13.5 billion in Covid vaccine sales in 2023 and $8 billion in revenue for Paxlovid.

Pfizer CEO Albert Bourla said during the earnings call that the company expects 2023 to be a "transition year" for Covid sales as the U.S. pivots to the commercial market for Covid products.

Covid vaccine, Paxlovid sales

Quarterly sales of the company's Covid vaccine declined $10 billion, or 75%, compared with the year-earlier period, on what Pfizer said was primarily driven by lower contracted deliveries and softer demand in international markets.

U.S. government contracted deliveries slowed as the nation prepared to shift Covid products to the commercial market later this year, the company said.

Sales of Paxlovid increased $2.8 billion year over year amid new launches in certain international markets and strong demand in China due to increased Covid cases. Sales were also driven by final deliveries associated with a U.S. contract finalized in late December.

Paxlovid first entered the U.S. market under emergency-use authorization in late December 2021. Pfizer hopes to win full Food and Drug Administration approval for the drug this year, but still expects 2023 sales to fall 58% compared to the previous year.

Bourla said Pfizer expects higher uptake of Paxlovid after this year.

"We then expect that in years 2024 and beyond, the courses sold and used will more closely align," he said.

The company also expects U.S. uptake of its Covid vaccine to decline this year and in 2024, Bourla said.

But the CEO noted that Pfizer expects vaccination rates to rebound starting in 2025 and "continuing in 2026 and beyond," assuming the company successfully launches several Covid combination vaccine treatments.

Bourla said the company expects a similar trend outside the U.S., with some variations in certain countries.

Other drug products

Excluding Covid product sales, Pfizer said first-quarter revenue grew 5% over the same period a year ago.

That growth was fueled by products from recently acquired companies, including Biohaven Pharmaceutical's migraine drug Nurtec ODT and Global Blood Therapeutics' sickle cell disease treatment Oxbryta, which contributed $167 million and $71 million, respectively.

The company said the increase was also driven by strong sales of drugs like Sulperazon, an antibiotic for the treatment of urinary tract infections, and blood thinner medication Eliquis.

Pfizer also said it expects 7% to 9% revenue growth this year, excluding Covid product sales.

Bourla said that's because the majority of the company's near-term product launches are expected to occur in the second half of this year. The company expects to launch 19 vaccines and treatments over the next 18 months, he noted.

"As such, we expect our non-Covid revenues to grow at a faster rate in the second half of the year than in the first," Bourla said during the call.

Pfizer and other drugmakers like Moderna and Johnson & Johnson have been bracing for a steep drop-off in Covid-related sales this year as the world emerges from the pandemic and relies less on blockbuster vaccines and treatments for the virus. 

But Pfizer is pinning its hopes on mergers and acquisition and a record pipeline to help the company navigate its post-pandemic boom. 

That pipeline includes Pfizer's RSV vaccine for use in older adults, which could win FDA approval later this month. It also includes the company's new pneumococcal vaccine for children and a treatment for ulcerative colitis from the recently acquired Arena Pharmaceuticals.

Pfizer also said last year it plans to add $25 billion in revenue through deal-making by 2030.

In March, the company took a big step toward that goal with the $43 billion acquisition of Seagen, which it said could contribute more than $10 billion in risk-adjusted sales by 2030 with its cancer therapies, according to Pfizer.

Correction: The Covid antiviral pill Paxlovid accounted for $4 billion in sales during the quarter. An earlier version misstated the revenue figure.

Read the earnings release.