Zoetis Stock Earnings Reports

Q1 2026 (aligned fiscal calendar) highlights: organic operational revenue was flat and adjusted net income grew ~1% as Zoetis faced a tougher-than-expected quarter in companion animal. U.S. revenue declined ~8% while International grew ~10% organically. Livestock was a strength, delivering ~12% organic growth, while companion animal fell ~4% (dermatology and parasiticides were the main drivers of weakness). Management attributes the companion-animal softness to a convergence of factors: multiyear price increases driving pet-owner price sensitivity, lower clinic traffic and delayed visits, intensified competitive promotional activity (notably in dermatology and parasiticides), and lack of market expansion versus prior competitive cycles. There was also a timing/fiscal-year alignment effect that shifted roughly $100M of revenue from Q4'25 into Q1'26. Actions and outlook: Zoetis is tightening discretionary spend and launching a cost/productivity program, sharpening commercial execution (vet engagement, DTC, loyalty/affordability at point of sale), accelerating “science-to-scale” launches (including long-acting mAbs and other lifecycle innovations), and agreed to acquire Neogen’s animal genomics business. Management expects stabilization in key franchises (Librela showing sequential stabilization; Simparica share recovering by quarter-end) and continues to invest in a pipeline of ~12 potential blockbusters. Updated full-year 2026 guidance (organic operational): revenue growth 2%–5% (revised range $9.68B–$9.96B); adjusted net income growth 2%–6% ($2.87B–$2.95B); updated EPS ranges: reported diluted $6.35–$6.50, adjusted diluted $6.85–$7.00. Margin notes: Q1 adjusted gross margin 71.8% (FX headwind ~150 bps; ex-FX gross margin improved ~140 bps). Management emphasizes the company’s diversified, cross-species portfolio as a buffer and reiterates focus on commercialization and pipeline-driven long-term growth.