Analysts project Pfizer’s fourth-quarter earnings per share to fall by approximately 15% year-over-year, reflecting a 45% drop in COVID-19 vaccine and therapeutic revenues compared with the same period last year. With COVID-19 product sales contributing roughly $2.5 billion in Q4 2023, the company faces a revenue shortfall that management expects will not be fully offset by its oncology and rare disease franchises. Operating expenses are anticipated to rise by nearly 5% due to continued investment in gene therapy manufacturing capacity and late-stage clinical trials for its Alzheimer’s candidate, putting further pressure on margins.

Over the past six months, Pfizer’s share performance has lagged peers Merck and Johnson & Johnson by about 12 percentage points, driven primarily by waning demand for its COVID-19 products and an impending patent cliff on its hypertension blockbuster set to expire in mid-2026. In contrast, Merck’s immuno-oncology portfolio and J&J’s diversified medical device and consumer health lines have provided more stable growth. Investors have also reacted to Pfizer’s 2026 financial guidance that calls for low-single-digit revenue growth, below consensus expectations for mid-single-digit expansion in the pharmaceutical sector.

Despite regulatory headwinds proposed under the new healthcare plan, Pfizer secured a negotiated three-year exemption from Section 232 import tariffs, a carve-out not afforded to many competitors. This exemption is estimated to preserve up to $400 million annually in gross profit by shielding its vaccine and small-molecule manufacturing imports from proposed duties. Additionally, potential reforms to the pharmacy benefit manager rebate model could enhance realized net prices for Pfizer’s portfolio by an estimated 2% to 3%, reinforcing the company’s margin defense against pricing pressures in the broader market.