Pfizer reported better-than-expected first-quarter earnings while unveiling an expanded cost-cutting initiative aimed at stabilizing its business amid a continued drop in Covid-related revenue. While first-quarter sales declined due to reduced demand for its antiviral Covid pill Paxlovid, the company posted adjusted earnings per share of 92 cents, surpassing analysts’ expectations of 66 cents. Total revenue reached $13.72 billion, slightly below forecasts but still reflecting strength in other areas of the business.
The pharmaceutical giant had previously announced a program to achieve $4.5 billion in net cost savings by 2025. It now expects to deliver an additional $1.2 billion in savings by the end of 2027, primarily through enhanced digital integration, including artificial intelligence and process automation. The company is also targeting $500 million in R&D-related savings by the end of 2026, with plans to reinvest those funds into its product pipeline.
In total, Pfizer expects approximately $7.7 billion in savings by the end of 2027 across both its original and expanded cost-saving programs. These measures are designed to offset financial headwinds caused by a steep decline in Covid product sales and ongoing market volatility. Net income for the quarter came in at $2.97 billion, or 52 cents per share, down from $3.12 billion a year ago.
Pfizer maintained its 2025 full-year revenue forecast of $61 billion to $64 billion, projecting performance from its Covid products to be consistent with 2024. The company noted, however, that this guidance does not reflect potential impacts from any new trade tariffs or policy shifts. Existing tariffs have already been factored into its forecast, accounting for around $150 million in costs. Company executives have formed a dedicated team to monitor and mitigate potential future tariff impacts.
Sales of Paxlovid plummeted 76% year-over-year to $491 million due to fewer global infections and declining international government purchases. By contrast, Comirnaty, Pfizer’s Covid vaccine, saw revenue climb 60% to $565 million, outperforming expectations.
Despite challenges, Pfizer remains confident in its ability to navigate regulatory uncertainty and changing public health policies. The company continues to anticipate a $1 billion hit from Medicare changes under the Inflation Reduction Act, expected to reduce revenue growth by 1.6% compared to 2024. Stripping out one-time items, Pfizer projects full-year 2025 earnings of $2.80 to $3.00 per share.
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