Johnson & Johnson Lowers Earnings Outlook After Suspending COVID-19 Vaccine Sales Forecast

February 3, 2018 Fremont / CA / USA - Johnson & Johnson logo in front of one of their office buildings, Fremont, East San Francisco bay area, California.
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Shares of Johnson & Johnson moved lower early Tuesday after the pharmaceutical and consumer products company lowered its full-year sales and earnings outlook, citing uncertain global demand for its COVID-19 vaccine.

A global supply surplus of COVID vaccines caused J&J to suspend revenue guidance on its own vaccine. Chief Financial Officer Joe Wolk told CNBC that developing nations have limited capacity when it comes to refrigerating vaccines and giving shots, contributing to a backlog of vaccines.

But Wolk downplayed J&J’s decision to no longer provide a sales outlook for its COVID vaccine, explaining that the company doesn’t normally provide guidance for specific products, anyway.

“We did it last year because we understood the Street had an expectation, or at least an excitement, around understanding how vaccine sales might play out, but it was never material,” Wolk said, adding that the vaccine is not for profit and doesn’t impact J&J’s bottom line.

As Bloomberg reported last month, the global vaccine industry is facing waning demand and a slowing market for the shots. This will likely put a big dent in the blockbuster sales that Big Pharma companies like Pfizer and AstraZeneca enjoyed during the pandemic’s peak.

As for J&J, Wolk said its Covid vaccine sales — $457 million globally — met the company’s internal expectations.

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In any case, J&J does have a less optimistic outlook for the year than it did previously. On Tuesday the company lowered its 2022 sales guidance from a range of $95.8 billion to $94.8 billion, or about $1 billion less than its January estimate. It also lowered its full-year adjusted earnings guidance by 25 cents from a range of $10.35 to $10.15 a share.

The company’s stock price fell less than 1% in early trading Tuesday after closing down 1.25% on Monday.

J&J reported first-quarter sales of $23.4 billion, up 5% from the previous year but slightly below Wall Street estimates. Earnings for the quarter were $2.67 a share, up 3% year-over-year and ahead of expectations.

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