Novartis AG (NYSE:NVS) has upgraded its full-year 2026 core operating income outlook after reporting third-quarter revenue growth and improved core operating margins, supported by increased sales of several key medicines.
The Swiss pharmaceutical group reported net sales of $14.52 billion for the three months ended September, representing a 4% increase, while core operating income rose 11% to $6.04 billion.
Novartis now expects full-year core operating income to remain in line with 2025 or increase by a low single-digit percentage at constant currencies, compared with its previous forecast of a low single-digit decline. The company maintained its guidance for low single-digit annual sales growth.
The revised outlook follows higher sales of treatments including Kisqali, Kesimpta, Scemblix and Leqvio, which helped offset continued competition from generic medicines.
Key Medicines Drive Third-Quarter Revenue Growth
Novartis reported increased sales across several of its priority pharmaceutical products during the third quarter.
Kisqali, its breast cancer treatment, recorded sales growth of 37% at constant currencies, while multiple sclerosis therapy Kesimpta increased 22%.
Sales of Scemblix rose 67%, and cholesterol-lowering treatment Leqvio recorded a 63% increase.
These products contributed to the company’s 4% quarterly revenue growth and supported an improvement in core operating profitability.
The performance came despite ongoing generic competition affecting parts of the company’s medicine portfolio.
Core Operating Income Increases 11% to $6.04 Billion
Novartis reported core operating income of $6.04 billion, up 11% from the corresponding period of the previous year.
The increase exceeded the company’s 4% sales growth rate, reflecting improved core operating margins during the quarter.
Chief Executive Vas Narasimhan attributed the performance to contributions from priority brands and new product launches, alongside productivity measures implemented across the business.
Following the results, Novartis raised its full-year core operating income guidance from an expected low single-digit decline to a range between broadly unchanged and low single-digit growth at constant currencies.
Its annual sales forecast remains unchanged, with the company continuing to anticipate low single-digit growth.
Reported Profit Declines Following Del-Desiran Impairment
Although core operating income increased, Novartis reported lower statutory earnings for the third quarter.
Reported operating income fell 59% to $1.84 billion, while net income decreased 70% to $1.20 billion.
The decline was primarily linked to a $1.9 billion partial impairment charge associated with del-desiran, an experimental treatment for myotonic dystrophy type 1.
The charge followed the drug’s failure to meet its primary endpoint in a late-stage clinical trial.
The impairment affected reported profitability but did not prevent the company from recording growth in its core operating income.
The results therefore showed a difference between Novartis’ underlying operating performance and its reported earnings after the impairment charge.
Remibrutinib Trial Results Add to Pipeline Developments
Novartis also reported positive late-stage clinical trial results for remibrutinib, a treatment under development for relapsing multiple sclerosis.
The announcement represents a further development in the company’s pharmaceutical pipeline, alongside the commercial performance of its existing medicines.
The positive remibrutinib results were reported during the same quarter in which the company recognized the impairment related to del-desiran.
Novartis did not provide additional regulatory timelines for remibrutinib in the supplied announcement.
Novartis Maintains Sales Guidance While Upgrading Profit Expectations
Novartis enters the final quarter of 2026 with an improved core operating income forecast following higher third-quarter sales and margin expansion.
The company continues to expect low single-digit full-year sales growth, while its revised profit guidance anticipates core operating income broadly in line with the previous year or increasing by a low single-digit percentage at constant currencies.
Sales growth across Kisqali, Kesimpta, Scemblix and Leqvio contributed to the quarterly performance, while the $1.9 billion del-desiran impairment weighed on reported earnings.
The updated guidance reflects management’s expectations for the full year, with future results dependent on product sales, operating performance and other developments affecting the business.