Viatris Stock Tumbles On Q4 Earnings Miss, FDA Warning Clouds 2025 Outlook

Viatris Inc. (VTRS) shares plummeted on Thursday after the company reported fourth-quarter earnings that missed analysts' expectations and issued a cautious outlook for 2025, citing regulatory challenges. The stock fell 13.9% to $9.68 at last check, extending its year-to-date decline to 9.7%.

Viatris reported fourth-quarter sales of $3.52 billion, down 8% year over year, and adjusted earnings per share (EPS) of $0.54, missing the consensus estimates of $3.61 billion and $0.57, respectively. The company's brands' net sales fell 10% to $2.16 billion, while generic revenues decreased 5% to $1.35 billion.

The company attributed the earnings miss to continued remedial work at its Indore, India, production site, which received a warning letter from the U.S. Food and Drug Administration (FDA) in December 2024. The FDA import alert is expected to reduce 2025 revenues by $500 million and adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) by $385 million.

Viatris expects 2025 adjusted EPS of $2.12-$2.26, compared to the consensus of $2.60, and sales of $13.5 billion-$14 billion, compared to the consensus of $14.3 billion. The company plans to prioritize $500-650 million in share repurchases for 2025.



Viatris' stock performance has been volatile in recent months, with the company facing regulatory challenges and missing earnings expectations. Investors should monitor the company's progress in addressing the FDA warning and the potential impact on its financial outlook.



| Metric | Q4 2024 | Q4 Estimate | Q4 2023 | Y/Y Change |
| --- | --- | --- | --- | --- |
| Total Revenue (in millions) | $3,528 | $3,592 | $3,837 | -8.1% |
| Adjusted Earnings Per Share | $0.54 | $0.57 | $0.62 | -12.9% |
| Free Cash Flow (in millions) | $685 | N/A | $543 | +26.1% |
| Adjusted EBITDA (in millions) | $983 | N/A | $1,117 | -12.0% |

Viatris' Q4 2024 financial results missed analysts' estimates, with total revenue and adjusted EPS declining year over year. However, the company reported a year-over-year increase in free cash flow, indicating effective financial management.

Viatris faces significant challenges in the coming quarters, including addressing the FDA warning and import alert, as well as executing its remediation plan for the Indore facility. The company's ability to navigate these challenges and deliver on its strategic transformation will be crucial for its long-term success.

Investors should closely monitor Viatris' progress in addressing these issues and its ability to execute on its strategic initiatives, such as prioritizing share repurchases and focusing on high-margin products. The company's ability to overcome these challenges and deliver on its financial outlook will be key to its stock performance in the coming quarters.