Biogen IDEC Inc Earnings Cheat Sheet: Streak of Three Straight Quarters of Expanding Margins Snapped, but Profit Rises

S&P 500 (NYSE:SPY) component Biogen IDEC Inc (NASDAQ:BIIB) reported net income above Wall Street’s expectations for the third quarter. Biogen Idec is a global biotechnology company that meets the rising needs of therapeutic care providers and recipients.

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Biogen IDEC Inc Earnings Cheat Sheet for the Third Quarter

Results: Net income for the biotechnology company rose to $351.8 million ($1.43 per share) vs. $254.1 million ($1.05 per share) in the same quarter a year earlier. This marks a rise of 38.5% from the year earlier quarter.

Revenue: Rose 11.4% to $1.31 billion from the year earlier quarter.

Actual vs. Wall St. Expectations: BIIB reported adjusted net income of $1.61 per share. By that measure, the company beat the mean estimate of $1.51 per share. It beat the average revenue estimate of $1.27 billion.

Quoting Management: “This has been a quarter of tremendous accomplishments for Biogen Idec,” said George A. Scangos, Ph.D., the company’s chief executive officer. “We continued to deliver strong product and financial performance driven by the growth of TYSABRI. The recent positive data readout from the CONFIRM trial of BG-12 is a truly meaningful development for our company and for multiple sclerosis patients, and we are thrilled by it. We now have strong results for BG-12 in two large and robust clinical trials and we anticipate filing for approval in the first half of next year with the intent of bringing this potentially major new therapy to MS patients as soon as possible. We continue to improve the quality of our pipeline by concentrating on cutting-edge science with the greatest potential to help patients and drive growth, and we are focused on excellence in execution as we prepare for the potential of multiple product launches in coming years.”

Key Stats:

Gross margin shrank 1.3 percentage points to 90.6%. The contraction appeared to be driven by increased costs, which rose 28.8% from the year earlier quarter while revenue rose 11.4%.

The company topped expectations last quarter after falling short of forecasts in the second quarter with net income of $1.35 versus a mean estimate of net income of $1.39 per share.

The increase in profit last quarter comes after net income fell in the previous quarter. In the second quarter, net income declined 1.8% to $288 million.

Revenue rose last quarter after seeing a drop the quarter before. Revenue fell 0.3% to $1.21 billion in the second quarter from the year earlier.

Looking Forward: The outlook for the company’s results in the upcoming quarter is unfavorable. The average estimate for the fourth quarter is $1.55 per share, down from $1.56 ninety days ago. The average estimate for the fiscal year is $5.85 per share, down from $5.86 ninety days ago.

Competitors to Watch: Elan Corp., plc (NYSE:ELN), Amgen, Inc. (NASDAQ:AMGN), Roche Holding Ltd. (RHHBY), Teva Pharmaceutical Industries Ltd (NASDAQ:TEVA), Abbott Laboratories (NYSE:ABT), Merck & Co., Inc. (NYSE:MRK), Genzyme Corporation (NASDAQ:GENZ), Pfizer Inc. (NYSE:PFE), GlaxoSmithKline plc (NYSE:GSK), and Bristol Myers Squibb Co. (NYSE:BMY).

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(Source: Xignite Financials)