Johnson & Johnson earnings to test drug growth behind stock rebound
The health-care group’s second-quarter report will show whether recent gains reflect more than a defensive rotation into lagging medical stocks.
By Marcus V. Thorne · Markets Editor
· 3 min read
Johnson & Johnson enters its second-quarter earnings report with its shares up more than 14% since the start of June as of Monday’s close, according to CNBC, after investors rotated into defensive health-care stocks. The company’s update on Wednesday is expected to test whether gains that carried the stock back to record territory are supported by growth in its drug and medical technology businesses.
The stock closed at $248.56 on March 2, then fell nearly 11% before bottoming on May 8, CNBC reported. It surpassed that prior high on June 26 and reached roughly $267 a share last Tuesday before giving back several percentage points in line with the S&P 500 health-care sector.
FactSet data cited by CNBC put the average analyst price target near $254, close to where Johnson & Johnson traded Tuesday afternoon. Nearly 70% of analysts covering the company have a buy-equivalent rating, according to the same data.
Drug portfolio in focus
Johnson & Johnson’s pharmaceutical arm, which the company calls Innovative Medicine, generated about two-thirds of its $94 billion in revenue last year. The remaining third came from MedTech, which includes medical devices and surgical products.
Within Innovative Medicine, investors are expected to focus on Darzalex, the blood-cancer treatment that remains Johnson & Johnson’s largest drug by sales. The company said Darzalex revenue rose 18%, excluding foreign-exchange effects, to $3.96 billion in the first quarter. FactSet consensus estimates cited by CNBC call for second-quarter revenue of $4.24 billion, implying 19.8% annual growth.
Chief Executive Joaquin Duato described Darzalex on Johnson & Johnson’s April earnings call as the “gold standard” for multiple myeloma. In a May CNBC interview, Duato said the company aims to become the top oncology company by 2030 and is allocating resources toward that objective.
Carvykti, another multiple myeloma treatment, is smaller but growing faster. Johnson & Johnson reported first-quarter sales of $597 million, up 57%. Analysts expect second-quarter sales of $654 million, representing 49% growth, according to FactSet. Darzalex is an antibody used as a core treatment, while Carvykti is a personalized therapy designed to help a patient’s immune system attack cancer cells.
Immunology and new launches
Tremfya, Johnson & Johnson’s second-largest drug behind Darzalex, is also under scrutiny. The injectable medicine belongs to a class known as IL-23 inhibitors, which target an inflammatory pathway used in conditions including plaque psoriasis, psoriatic arthritis and inflammatory bowel disease.
Johnson & Johnson said Tremfya revenue rose 64% to $1.6 billion in the first quarter, helped by new U.S. patient starts in inflammatory bowel disease. FactSet estimates cited by CNBC call for second-quarter sales of $1.78 billion, or 50% year-on-year growth.
Investors are also seeking early signs of demand for Icotyde, a recently launched daily pill that blocks the IL-23 receptor. The Food and Drug Administration approved the medicine in mid-March for moderate to severe plaque psoriasis, so analysts expect its second-quarter contribution to be limited. Goldman Sachs analysts, who have a buy rating and $275 price target on Johnson & Johnson, wrote last week that their expert survey supported the company’s view that Icotyde could eventually generate at least $10 billion in annual revenue, CNBC reported.
MedTech faces volume questions
Johnson & Johnson’s MedTech segment grew 4.6% in the first quarter, compared with 7.4% growth for Innovative Medicine. Within MedTech, RBC Capital analyst Shagun Singh told CNBC that cardiovascular care is the key end market. Johnson & Johnson said cardiovascular revenue rose 10.5% last quarter, compared with 1.2% growth in surgery, 3.6% in vision and 3.2% in orthopaedics.
The MedTech results will be read against a warning from HCA Healthcare on Tuesday about weaker surgical procedure volumes. Johnson & Johnson also said in October 2025 that it would separate its orthopaedics business and was considering alternatives including a sale or spinoff.
The earnings report will also show how quickly Johnson & Johnson can offset the decline of Stelara, a former blockbuster that lost exclusivity in 2025. The company reported first-quarter Stelara revenue of $656 million, down 62% from a year earlier, and FactSet estimates point to a similar decline in the second quarter.
This story draws on original reporting from CNBC.
