Merck Kgaa (germany) Adr (sponsored) Stock Earnings Reports

Q1 2026 highlights: Merck delivered a solid start to 2026 with organic group sales up ~+3% and organic EBITDA pre up ~+5%. Life Science was the main driver (organic +8.3%), led by Process Solutions which accelerated to +16% in the quarter ( >EUR1bn sales in the quarter) and orderbook/book-to-bill strong. Electronics grew organically ~+4%, powered by double-digit semiconductor materials growth; reported Electronics profitability benefited from two one-offs (EUR 42m gain from OLED IP divestment and ~EUR25m supplier dispute recovery). Healthcare declined organically ~-3.4%, mainly due to U.S. generic competition for Mavenclad, though rare disease franchises and Pergoveris showed strength. FX was a material headwind in Q1 and disproportionately impacted reported results versus organic. Cash flow improved materially (operating cash flow up significantly) and net financial debt decreased modestly. Management raised full-year 2026 guidance: sales EUR 20.4–21.4bn, EBITDA pre EUR 5.7–6.1bn, EPS pre EUR 7.50–8.20. Life Science organic guidance was upgraded to +4%–+7%; Healthcare guidance modestly adjusted but still faces H2 launch investments; Electronics guidance confirmed. Strategy update: management will pursue four strategic streams (focus on high‑growth value drivers, integrated workflow solutions, cross-business platform capabilities, and disciplined M&A/in‑licensing) to accelerate growth and scaling, with an ambition to move Healthcare R&D to around 25% of sales while keeping Healthcare EBITDA pre north of 30% midterm. Key investor risks: continued FX volatility, further generic entries for Mavenclad in the U.S., and geopolitical/ Middle East uncertainty affecting phasing.