Bayer AG BAYRY reported second-quarter 2026 core earnings of 29 cents per American Depositary Receipt (ADR), which beat the Zacks Consensus Estimate of 23 cents. The company reported earnings of 32 cents per ADR in the year-ago quarter.
Core earnings per share of €0.95 declined 16.7% year over year. Higher earnings in the Crop Science division were only partly offset by a normalization in tax expense and lower earnings from reconciliation items.
Total sales in the second quarter were $12.64 billion, which increased 1.2% on a reported basis, and beat the Zacks Consensus Estimate of $12.32 billion.
On a currency and portfolio-adjusted basis, sales were up 2.2% year over year.
Shares of Bayer have gained 25.4% year to date compared with the industry’s 9.9% gain.
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All growth rates mentioned below are on a year-over-year basis after adjusting for currency and portfolio changes.
BAYRY’s Q2 Results in Detail
Bayer reports under three segments, namely Crop Science, Pharmaceuticals and Consumer Health.
Crop Science sales increased 3.5% to €4.9 billion. Within this segment, Corn Seed & Traits sales declined 2.5% as strong growth in the Europe/Middle East/Africa and Asia-Pacific regions was only partly offset by lower North American volumes, reflecting the timing shift of sales into the first quarter. In the Herbicides business, sales were up 1.9%, supported by double-digit growth in glyphosate-based products, driven by higher volumes and improved pricing, particularly in the Europe/Middle East/Africa region. However, sales of non-glyphosate herbicides declined due to lower prices in North America amid continued competitive pressure from generic products.
Fungicide sales were down 2% year over year primarily due to unfavorable weather conditions and continued generic competition in the Europe/Middle East/Africa region. Soybean Seed & Traits sales surged 16.9%, driven by continued price recovery in North America following the reinstatement of the dicamba label in the United States, along with robust growth in Latin America, supported by higher sales volumes.
The Insecticides business gained 15.9%, driven by higher volumes and improved pricing in the Europe/Middle East/Africa and Asia-Pacific regions. The Vegetable Seeds business was down 2.5% due to lower volumes in Latin America. Cotton Seed business soared 69.2%, fueled by significantly higher volumes and improved pricing in North America following the reinstatement of the dicamba label in the United States.
The Pharmaceutical segment sales increased 0.8% to €4.5 billion as gains in Nubeqa and Kerendia were offset by significant declines for Xarelto due to patent expiration and lower Eylea sales.
Nubeqa (for cancer) sales surged 63.9% to €880 million, maintaining its robust commercial momentum. Growth was particularly strong in the United States and Europe, driven by significant increases in sales volumes. Sales of the ophthalmology drug Eylea decreased 32.8% to €573 million due to competitive pressure from generics, especially in Europe and Canada.
Nonetheless, the launch of Eylea 8 mg, which allows for extended treatment intervals, helped partially offset the decline and supported overall sales. Eylea 8 mg accounted for around 55% of overall Eylea sales.
Bayer’s HealthCare unit co-develops Eylea with Regeneron REGN, which records net product sales of Eylea and Eylea 8 mg in the United States. BAYRY records net product sales of Eylea outside the country. REGN records its share of profits and losses from the sale of Eylea outside the United States.
Sales of oral anticoagulant Xarelto, co-developed with Johnson & Johnson JNJ, plunged 42.4% to €374 million due to competitive pressure from generics, especially in Europe.
In the U.S. market, Xarelto is marketed by J&J. Bayer earns license revenues from JNJ for Xarelto sales in the United States.
Sales of the Mirena product family (long-term contraceptive) increased 9%, driven by growth in the United States.
Kerendia sales (for the treatment of chronic kidney disease associated with type 2 diabetes and heart failure) skyrocketed 82.9%, fueled by a substantial rise in volumes in the United States and China.
Sales of Aspirin Cardio and Stivarga declined 3.3% and 12.3%, respectively, with the business primarily down in China.
Consumer Health sales were up 1.5% to €1.44 billion in the second quarter, driven by growth in the business across almost all categories. On a regional level, sales advanced in Europe/Middle East/Africa, Latin America and Asia/Pacific.
Within the Consumer Health franchise, Dermatology category’s (+1.5%) growth was largely fueled by higher Bepanthen sales in Latin America. Nutritionals category (+1.9%) posted growth driven by significant gains for its Natsana e-commerce business.
Business in the Allergy & Cold category was down (-8%), reflecting a soft allergy, cough and cold season overall. Digestive Health business sales delivered strong sales growth (+9.4%) across all regions. Pain & Cardio product sales increased 3.4%, mainly fueled by higher Actron volumes and prices in Latin America.
BAYRY Reiterates Currency-Adjusted 2026 Guidance
On a currency-adjusted basis, Bayer expects to generate sales in the range of €45-€47 billion in 2026. For the Crop Science Division, it expects currency and portfolio-adjusted sales growth to be flat to +3%. For the Pharmaceuticals Division, Bayer expects currency and portfolio-adjusted sales growth to be flat to +3%. Consumer Health sales growth is projected to be flat to +4%.
Core EPS is projected to be in the band of €4.30-€4.80.
Update on the Glyphosate Litigations
In June, the U.S. Supreme Court issued a landmark 7-2 ruling in the Durnell Roundup (glyphosate) case. The court held that the Federal Insecticide, Fungicide, and Rodenticide Act (FIFRA) preempts state-law failure-to-warn claims when the U.S. Environmental Protection Agency (EPA) has made a definitive determination regarding the product's safety. The ruling is expected to significantly limit Roundup litigation by paving the way for the dismissal of existing warning-based claims and preventing future state-law failure-to-warn lawsuits, which have accounted for the vast majority of cases to date.
In July, Bayer announced the consolidation of its U.S. glyphosate business into Ruveon LLC as part of its efforts to improve efficiency and better align operations with the dynamics of the U.S. market. Ruveon, a Bayer Group company based in St. Louis, MO, will oversee all aspects of the U.S. glyphosate business, including pricing, commercial strategy, manufacturing and logistics.
Pipeline Updates From Bayer
In oncology, China's regulatory body approved sevabertinib (Hyrnuo) in April for previously treated HER2-mutated advanced NSCLC, while the FDA granted Priority Review in May for its use as a first-line treatment.
In cardiovascular disease, marketing authorization applications for asundexian for the prevention of ischemic stroke in patients after a non-cardioembolic ischemic stroke or transient ischemic attack was accepted by the FDA, with Priority Review designation. The FDA accepted the supplemental New Drug Application (sNDA) and granted Priority Review designation for Kerendia for the treatment of chronic kidney disease (CKD) associated with type 1 diabetes
In radiology, the FDA approved Ambelvist (gadoquatrane) in June for contrast-enhanced MRI in adult and pediatric patients.
Our Take on BAYRY’s Performance
Bayer posted better-than-expected results for the second quarter. The performance of Crop Science was impressive, driven by strong growth in glyphosate-based herbicides.
Key drugs like Nubeqa and Kerendia boosted Pharmaceuticals sales, enabling the company to combat declines in Eylea and Xarelto following patent expirations.
Label expansion of key drugs and approval of additional drugs will further boost sales from this business. The recent FDA approval of elinzanetant for the treatment of moderate to severe menopause-related vasomotor symptoms, under the brand name Lynkuet, is a significant boost for the company.
The Consumer Health business, too, posted an increase led by strong growth in Digestive Health, while Allergy & Cold sales declined.
Bayer’s Zacks Rank
BAYRY currently carries a Zacks Rank #4 (Sell).
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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Bayer Aktiengesellschaft (BAYRY): Free Stock Analysis Report
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Johnson & Johnson (JNJ): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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