Johnson & Johnson (JNJ) Stock Drops Despite Earnings Beat and Strong 2026 Outlook

TLDR

• Johnson & Johnson beat Q4 estimates with adjusted earnings of $2.46 per share versus $2.42 expected and sales of $24.56 billion versus $24.1 billion forecast
• Stock fell 1.7% in premarket trading despite the earnings beat, likely due to profit-taking after shares gained 43% in 2025
• Stelara sales dropped 48% in Q4 after losing patent protection, while Darzalex sales jumped 27% and Tremfya surged 68%
• Company issued 2026 guidance above Wall Street expectations with adjusted earnings of $11.53 per share on sales of $100.5 billion
• Multiple myeloma franchise including Darzalex and Tecvayli could generate $25 billion by 2030 according to CEO Joaquin Duato

Johnson & Johnson posted fourth-quarter results that exceeded Wall Street expectations on Wednesday. But the stock moved lower anyway.

The pharmaceutical giant reported adjusted earnings of $2.46 per share. Analysts had expected $2.42.

Revenue came in at $24.56 billion. That represents 9.1% growth from a year earlier and beat the $24.1 billion consensus estimate.

Johnson & Johnson, JNJ

Shares fell 1.7% in premarket trading. The drop likely reflects profit-taking after an exceptional run. The stock gained 43% in 2025, marking its best yearly performance since 1995.

Not everything in the report looked rosy. Stelara sales crashed 48% in the quarter after the company lost patent protection for the biologic last year.

The drug was once one of Johnson & Johnson’s top sellers. Its decline created a drag on the pharmaceutical division’s operational sales growth.

Other products picked up the slack. Darzalex sales climbed 27% in the quarter. Tremfya sales jumped 68%.

Strong 2026 Guidance Points to Continued Growth

The company’s full-year outlook exceeded analyst expectations. Management guided for adjusted earnings of $11.53 per share on sales of $100.5 billion for 2026.

Wall Street had been looking for earnings of $11.48 per share. Revenue estimates stood at $98.9 billion.

CEO Joaquin Duato highlighted the company’s multiple myeloma franchise at the JPMorgan Healthcare Conference last week. The franchise includes Darzalex and Tecvayli.

Duato said the franchise could generate $25 billion in sales by 2030. He noted that figure might even be conservative.

The CEO pointed to combination therapy trials of Tecvayli and Darzalex. He called the results “perhaps the most impressive data ever seen in multiple myeloma.”

The medical technology segment also showed growth. Worldwide operational sales increased 5.6% year-over-year in the third quarter.

Electrophysiology and wound closure products drove the gains. Acquired businesses Abiomed and Shockwave also contributed to growth.

Johnson & Johnson recently struck a deal with the White House to lower prices on certain medications. The agreement removed a source of uncertainty that had weighed on the stock.

Manufacturing Expansion and Legal Challenges

The company plans to build two new U.S. manufacturing facilities. The move is part of a $55 billion investment push.

Management said additional investments will be announced later in 2026. The manufacturing expansion shows confidence in future demand.

Legal challenges continue to loom over the company. Around 3,000 claimants in the U.K. have filed suit over talcum powder products.

The plaintiffs accuse Johnson & Johnson of selling baby powder contaminated with cancer-causing asbestos. The lawsuit filed in mid-October also names Kenvue, which was spun off in 2023.

Johnson & Johnson maintains that Kenvue “retained the responsibility and any purported liability for talc-related litigation outside of the U.S. and Canada.” Kenvue has denied any wrongdoing.

The pharmaceutical division brought in $15.6 billion in the third quarter. That represented 5.3% operational growth year-over-year.

Institutional investors continue to adjust their positions. Data shows 69.55% of the stock is held by institutional investors and hedge funds.

The company declared a quarterly dividend of $1.30 per share payable March 10th to shareholders of record on February 24th. That represents an annualized dividend of $5.20 and a yield of 2.4%.

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