Novartis has projected a low single-digit percentage decline in its 2026 operating profit, citing increased competition from lower-cost copies of established therapies such as its heart failure medication Entresto. The company expects this headwind to dampen margin expansion, despite ongoing cost-efficiency initiatives and a diversified portfolio spanning oncology, immunology and neuroscience.

In 2025, Novartis reported year-on-year revenue growth driven by strong demand for its oncology portfolio and steady uptake of newly launched cell and gene therapies. While full-year sales increased, management has guided core operating profit lower in 2026, reflecting anticipated volume erosion on key products facing biosimilar entry in major markets and continued investment in late-stage pipeline assets.

During the third quarter, Federated Hermes Inc. reduced its holding in Novartis by 48.4%, trimming 48,181 shares to leave 51,422 in its portfolio. In contrast, Fisher Asset Management boosted its stake by 5.3% to just over 7.1 million shares, and Envestnet Asset Management increased holdings by 8.0% to approximately 1.7 million shares. Analyst coverage remains mixed: of 16 recent research reports, one recommends Strong Buy, six advise Buy, seven maintain Hold and two suggest Sell, yielding an overall consensus rating of Hold.