Did you analyze how Eli Lilly (LLY) fared in its international operations for the quarter ending June 2025? Given the widespread global presence of this drugmaker, scrutinizing the trends in international revenues becomes imperative to assess its financial strength and future growth possibilities.
In today's increasingly interconnected global economy, a company's ability to tap into international markets can be a pivotal factor in shaping its overall financial health and growth trajectory. For investors, understanding a company's reliance on overseas markets has become increasingly crucial, as it offers insights into the company's sustainability of earnings, ability to tap into diverse economic cycles and overall growth potential.
Presence in international markets can act as a hedge against domestic economic downturns and provide access to faster-growing economies. However, this diversification also brings complexities due to currency fluctuations, geopolitical risks and differing market dynamics.
While delving into LLY's performance for the past quarter, we observed some fascinating trends in the revenue from its foreign segments that are commonly modeled and observed by analysts on Wall Street.
The recent quarter saw the company's total revenue reaching $15.56 billion, marking an improvement of 37.6% from the prior-year quarter. Next, we'll examine the breakdown of LLY's revenue from abroad to comprehend the significance of its international presence.
A Closer Look at LLY's Revenue Streams Abroad
China accounted for 3% of the company's total revenue during the quarter, translating to $465.9 million. Revenues from this region represented a surprise of +3.47%, with Wall Street analysts collectively expecting $450.26 million. When compared to the preceding quarter and the same quarter in the previous year, China contributed $450.8 million (3.5%) and $395 million (3.5%) to the total revenue, respectively.
During the quarter, Japan contributed $521 million in revenue, making up 3.4% of the total revenue. When compared to the consensus estimate of $503.91 million, this meant a surprise of +3.39%. Looking back, Japan contributed $402.2 million, or 3.2%, in the previous quarter, and $463 million, or 4.1%, in the same quarter of the previous year.
Other foreign countries generated $1.18 billion in revenues for the company in the last quarter, constituting 7.6% of the total. This represented a surprise of +0.56% compared to the $1.18 billion projected by Wall Street analysts. Comparatively, in the previous quarter, Other foreign countries accounted for $997.4 million (7.8%), and in the year-ago quarter, it contributed $1.21 billion (10.7%) to the total revenue.
Of the total revenue, $2.57 billion came from Europe during the last fiscal quarter, accounting for 16.6%. This represented a surprise of +25.64% as analysts had expected the region to contribute $2.05 billion to the total revenue. In comparison, the region contributed $2.39 billion, or 18.8%, and $1.4 billion, or 12.4%, to total revenue in the previous and year-ago quarters, respectively.
Revenue Projections for Overseas Markets
Wall Street analysts expect Lilly to report $15.74 billion in total revenue for the current fiscal quarter, indicating an increase of 37.6% from the year-ago quarter. China, Japan, Other foreign countries and Europe are expected to contribute 3.1% (translating to $494.44 million), 3.5% ($546.46 million), 7.8% ($1.23 billion), and 15.1% ($2.38 billion) to the total revenue, respectively.
For the entire year, the company's total revenue is forecasted to be $61.11 billion, which is an improvement of 35.7% from the previous year. The revenue contributions from different regions are expected as follows: China will contribute 3.1% ($1.86 billion), Japan 3.4% ($2.1 billion)Other foreign countries 7.7% ($4.71 billion) and Europe 15.6% ($9.52 billion) to the total revenue.
Wrapping Up
Lilly's reliance on international markets for revenues offers both opportunities and risks. Hence, keeping an eye on its international revenue trends could significantly help forecast the company's prospects.
With the increasing intricacies of global interdependence and geopolitical strife, Wall Street analysts meticulously observe these patterns, especially for companies with an international footprint, to tweak their forecasts of earnings. Importantly, several additional factors, such as a company's domestic market status, also impact these earnings forecasts.
At Zacks, we place significant importance on a company's evolving earnings outlook. This is based on empirical evidence demonstrating its strong influence on a stock's short-term price movements. Invariably, there exists a positive relationship -- an upward revision in earnings estimates is typically mirrored by a rise in the stock price.
The Zacks Rank, our proprietary stock rating mechanism, demonstrates a notable performance history confirmed through external audits. It effectively utilizes the power of earnings estimate revisions to act as a predictor of a stock's price performance in the near term.
At the moment, Lilly has a Zacks Rank #3 (Hold), signifying that its performance may align with the overall market trend in the upcoming period. You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>> .
Eli Lilly's Recent Stock Market Performance
Over the preceding four weeks, the stock's value has diminished by 21.1%, against an upturn of 2.7% in the Zacks S&P 500 composite. In parallel, the Zacks Medical sector, which counts Lilly among its entities, has depreciated by 3.3%. Over the past three months, the company's shares have seen a decline of 17.4% versus the S&P 500's 13.2% increase. The sector overall has witnessed a decline of 1.8% over the same period.
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Eli Lilly and Company (LLY): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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