Zoetis (ZTS) Barclays 28th Annual Global Healthcare Conference summary

Fiscal 2025 performance and 2026 outlook

• Achieved 6% organic operational revenue growth and 7% bottom-line growth in 2025, with stronger growth in the first half than the second half due to consumer pressures and competitive launches.

• U.S. consumer weakness, especially among Gen Z and millennials, led to lower volumes but higher prices in pet care; livestock portfolio showed robust growth.

• 2026 guidance projects 3%-5% top-line growth and 3%-6% bottom-line growth, with livestock expected to outpace companion animal growth.

• Price contributed just under 4% to 2025 growth, with volume accounting for about 2.5%; 2026 guidance assumes a balanced contribution from price and volume.

• Diagnostics, though 4% of revenues, is growing faster than the overall business and will contribute to growth.

Diversification and international trends

• U.S. accounts for 55% of total revenues, with international markets providing diversification and resilience against regional headwinds.

• International companion animal business has grown at a similar rate to the U.S., with significant opportunities ahead, especially as innovation expands globally.

• Livestock growth is driven by demand for animal protein, with aqua and poultry as the fastest-growing segments.

Key product segments and market dynamics

• Parasiticides is a $7 billion global segment, with triple combinations like Trio becoming the standard in the U.S.; triple combinations now represent 50% of the market and are expected to reach two-thirds.

• Trio delivered $1 billion in U.S. revenues in 2025, with significant expansion potential as market penetration increases.

• Dermatology revenues reached $1.7 billion in 2025, with growth slowing in the second half due to competitive launches and fewer therapeutic visits, but long-term expansion opportunities remain.

• Key franchises in derm, Simparica, and pain are expected to grow mid- to high-single digits in 2026.