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.
Sundry Photography / Shutterstock.com

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.

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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.

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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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About the Author

Vance Cariaga is a London-based writer, editor and journalist who previously held staff positions at Investor’s Business Daily, The Charlotte Business Journal and The Charlotte Observer. His work also appeared in Charlotte Magazine, Street & Smith’s Sports Business Journal and Business North Carolina magazine. He holds a B.A. in English from Appalachian State University and studied journalism at the University of South Carolina. His reporting earned awards from the North Carolina Press Association, the Green Eyeshade Awards and AlterNet. In addition to journalism, he has worked in banking, accounting and restaurant management. A native of North Carolina who also writes fiction, Vance’s short story, “Saint Christopher,” placed second in the 2019 Writer’s Digest Short Short Story Competition. Two of his short stories appear in With One Eye on the Cows, an anthology published by Ad Hoc Fiction in 2019. His debut novel, Voodoo Hideaway, was published in 2021 by Atmosphere Press.
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