Novo Nordisk (NVO) released its third-quarter fiscal 2025 results, reporting earnings and sales that both fell short of expectations. What’s worse, the company lowered its full-year fiscal 2025 revenue and earnings guidance due to escalating competition and pricing pressures in the blockbuster weight-loss drug market. NVO stock is rising in pre-market trading at the time of writing.
Elevate Your Investing Strategy:
- Take advantage of TipRanks Premium at 50% off! Unlock powerful investing tools, advanced data, and expert analyst insights to help you invest with confidence.
The Danish pharmaceutical giant is facing multiple headwinds, including disappointing clinical trial results, rising competition in the GLP-1 drug segment, and stringent U.S. drug export policies and tariffs. The company also faces investor pushback against its strategic acquisition of the U.S.-based obesity biotech firm Metsera (MTSR), which is also being targeted by Pfizer (PFE) due to its valuable drug pipeline.
Novo Nordisk became Europe’s most valuable company due to rapid sales growth from its successful obesity drug, Wegovy. However, recent slowing sales growth has led to management changes and a significant stock price decline of approximately 43% year-to-date.
Details of Q3 Results
In Q3 FY25, Novo Nordisk reported earnings of DKK 4.50 per share ($0.69), down 26% year-over-year and below the FactSet consensus of DKK 4.90 ($0.76). Sales rose 5.1% year-over-year to DKK 74.98 billion but missed the consensus estimate of DKK 76.49 billion.
Meanwhile, sales of its weight-loss drug Wegovy increased 18% year-over-year to DKK 20.35 billion, short of the expected DKK 21.35 billion.
Novo Nordisk Cuts FY25 Guidance
Amid ongoing pressure in the weight-loss drug category, Novo Nordisk revised its full-year guidance for the fourth time in 2025. The company now projects sales growth of 8% to 11% at constant exchange rates (CER), down from its previous estimate of 8% to 14%. Operating profit growth is expected to range from 4% to 7%, compared with the earlier projection of 4% to 10%.
Novo Nordisk faces stiff competition from U.S. rival Eli Lilly’s (LLY) weight-loss drug Zepbound and numerous copycat drugs. The company also highlighted concerns about ongoing “unsafe and unlawful mass compounding” of its drugs, which it says persisted during the third quarter.
The company’s CEO, Mike Doustdar, who started in August 2025, stressed the importance of moving faster in a competitive market. Novo Nordisk is also growing its drug pipeline through acquisitions like Akero Therapeutics and by developing new weight-loss treatments such as cagrilintide. The company is undertaking a global mass layoff of approximately 9,000 employees as part of a restructuring effort to reduce costs and streamline operations under the new CEO.
Is NVO Stock a Buy?
Analysts remain divided on Novo Nordisk’s long-term outlook. On TipRanks, NVO stock has a Moderate Buy consensus rating based on five Buys, two Holds, and one Sell rating. The average Novo Nordisk price target of $60.50 implies 25.4% upside potential from current levels.
Please note, these ratings were issued before the Q3 earnings report and may change once analysts review the results.
