Merck (MRK) Q4 2025 earnings summary

Executive summary

• Delivered on 2025 financial guidance with stable net sales at €21.1 billion and organic growth of 3.1%, despite significant foreign exchange and geopolitical headwinds.

• EBITDA pre grew to €6.1 billion, up 5.6% organically, with margin improvement to 28.9%.

• Growth was driven by Process Solutions in Life Science, Rare Diseases and CM&E in Healthcare, and Semiconductor Materials in Electronics.

• Strategic acquisitions (SpringWorks, Hub Organoids, JSR Life Sciences chromatography) and divestment of Surface Solutions enhanced the portfolio.

• Proposed stable dividend of €2.20 per share, marking the fifteenth consecutive year of stable or increasing dividends.

Financial highlights

• FY 2025 net sales were €21.1 billion, down 0.3% year-over-year due to -3.7% FX impact; organic growth of 3.1%.

• EBITDA pre rose 0.6% to €6.1 billion, margin up to 28.9%.

• EPS pre declined 3.4% to €8.34, mainly due to higher interest costs from USD bond issuance.

• Operating cash flow decreased 14.3% to €3.9 billion, impacted by variable compensation and working capital.

• Net financial debt increased to €8.6 billion, mainly due to the SpringWorks acquisition.

Outlook and guidance

• FY 2026 group guidance: net sales €20.0–21.1 billion (organic -1% to +2%), EBITDA pre €5.5–6.0 billion (organic -4% to +1%), EPS pre €7.10–8.00.

• Life Science expected to grow organically +3% to +6% YoY; Healthcare organic sales to decline -7% to -4% YoY due to Mavenclad generics; Electronics organic sales to grow +3% to +7% YoY.

• Foreign exchange expected to negatively impact net sales by -4% to -2% and EBITDA pre by -7% to -3%.

• Dividend proposal of €2.20 per share for 2025, with a payout ratio of 26.4%.

• Guidance assumes no US Mavenclad sales from March 2026 due to generic entry.