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Pfizer issues weak guidance despite Q4 earnings beat

Yahoo Finance’s Anjalee Khemlani joins the Live show to discuss fourth-quarter earnings for Pfizer.

Video transcript

RACHELLE AKUFFO: Pfizer reporting an earnings beat for the fourth quarter but issuing some weak guidance for its COVID-19 vaccine products. Yahoo Finance's Anjalee Khemlani joins us now with more. We see there the stock under pressure as a result.

ANJALEE KHEMLANI: That's right, Rachelle. Unfortunately we know that with everything that is going on with the pandemic as it stands right now with the White House itself calling for the end of the pandemic in May, the companies, including Pfizer, are now looking for a downgrade in what they expect for sales related to their COVID products. That includes, for Pfizer specifically, the Comirnaty vaccine that it shares with BioNTech as well as Paxlovid, the treatment. Downgrading those two to basically a fraction of what we saw in recent years. $13.5 billion is the revenue estimate for '23, and $8 billion for Paxlovid there you see on your screen.

Meanwhile, the company boasting beyond $100 billion for the first time in full-year revenue for 2022. That's the first time the company has reached that high in its 174-year history, I believe, and so that's something that they're pretty excited about.

And, of course, we know this all comes because of those COVID products. If you look at quarter over quarter when the company was breaking out its revenue for a time, you saw that operational growth really surpassed. I mean significant numbers. They were just 82%, for example, in the first quarter of '22 compared to, without COVID products, an increase of 2%, and you can see on your screen just how that progressed over time.

So getting beyond that now, the company is really looking beyond what they can do. So the COVID products is one obstacle. The other one is a loss of exclusivity on some of their products, looking at a hit of $17 billion in the coming years. And that is something that Pfizer's CEO Albert Bourla has specifically talked about with recent acquisitions as well as 19 products. In the pipeline being able to offset that $17 billion.

That's the expectation for this year and through the upcoming years, and so we'll have to see how that all pans out. And that's one of the reasons why some analysts, including at Wells Fargo, they downgraded Pfizer recently. Hoping to see some of that come to fruition.

So right now, the company really focused, kind of back to square one a little bit of where they were prepandemic on trying to focus and prove the point that they are more than just a XYZ company-- in this case, more than just a vaccine company and more than just a COVID company.

So really setting the stage here-- many of the comments from the executives today really setting the stage for strong capital allocation including, by the way, more focus on the commercialization of the COVID vaccine, and that is going to need as well, you know, sales and support. So they're spending on that as well as R&D. So full picture, a lot still going on for Pfizer right now.

RACHELLE AKUFFO: It's a lot to adjust to as we come off the peak of the pandemic and look for the path forward. Anjalee Khemlani, thanks so much.