Amgen (AMGN.US) Q3 Earnings Call: Raises Full-Year Revenue and EPS Guidance; Management Expects Very Rapid First-Line Uptake of IMDELLTRA

Amgen (AMGN.US) Q3 Earnings Call: Raises Full-Year Revenue and EPS Guidance; Management Expects Very Rapid First-Line Uptake of IMDELLTRA On November 3 (Tuesday) after the U.S. market close, Amgen (AMGN.US) reported third-quarter 2026 results. Total revenue was $10.365 billion, up 8% year over year, above the market expectation of approximately $10.0510.07 billion; product sales were $9.883 billion, up 8% year over year. Non-GAAP EPS was $6.45, up 14% year over year, above expectations of $5.775.79; GAAP EPS was $7.08, up 19% year over year. Non-GAAP operating margin was 47.3%, up 0.2 percentage points year over year; free cash flow was $3.7 billion (versus $4.2 billion in the prior-year period). In the quarter, the six key growth products combined grew 27% year over year and accounted for more than 70% of product sales. Repatha, EVENITY, TEZSPIRE, UPLIZNA, BLINCYTO and IMDELLTRA all achieved double-digit growth, and a total of 17 products had annualized Q3 sales exceeding $1 billion. The company also raised its full-year 2026 guidance: total revenue raised to $38.939.7 billion (from $38.239.4 billion), and non-GAAP EPS raised to $22.9023.70 (from $22.3023.50). The stock did not get a lift after the results: in Tuesday's regular session Amgen closed down 0.90% at $461.26, and fell further after hours to $454.90 at 17:28 ET, down 1.38%. The most closely watched issue on this call was not the magnitude of the beat, but the first-line maintenance data for IMDELLTRA (tarlatamab) presented at the ESMO Congress. The DeLLphi-305 study showed that IMDELLTRA plus IMFINZI versus IMFINZI alone as first-line maintenance therapy extended median overall survival to 21.1 months versus 12.7 months, a gain of more than 8 months; R&D head Jay Bradner called the result "practice-changing" and said the company would "accelerate submissions to global regulators." Evercore ISI analyst Umer Raffat pressed: is it realistic to assume more than 20,000 U.S. patients on the drug and more than $5 billion from the first-line maintenance business alone? Global commercial head Murdo Gordon said clearly: "You know me and the Amgen teamwe don't give guidance on individual products," but added that with movement into earlier lines, the addressable U.S. small cell lung cancer population is 35,000 patients, and "we expect clinical behavior to change very rapidly," saying oncologists are "stunned by the magnitude and the safety profile of these data." The FDA has already shortened the recommended monitoring time for the first two doses of IMDELLTRA from 2224 hours to 68 hours, and in the DeLLphi-305 regimen it falls further to 12 hours, which management believes will significantly lower the barrier to use in community oncology clinics. Financials and capital allocation: New CFO's first appearance, expects no margin step-down in 2027 This quarter was the first earnings call for new CFO Thomas J. Dittrich. He laid out two priorities: driving long-term growth and operating efficiency through teamwork, and maintaining strict capital allocation discipline. In the quarter, non-GAAP R&D expense rose 11% year over year and SG&A expense fell 1% year over year; capex was $600 million, directed to U.S. manufacturing sites in North Carolina, Ohio and Puerto Rico, with full-year capex guidance of approximately $2.6 billion to prepare capacity for the commercial growth and potential launch of MariTide. The quarterly dividend was $2.52 per share, up 6% year over year, and share repurchases for the year will not exceed $3 billion. He also offered a forward-looking statement: "Looking to 2027, we do not expect operating margin to step down from the 2026 guidance." At the same time, he cautioned that fourth-quarter operating expenses will rise noticeably sequentially, consistent with the company's established pattern of year-end spending, that cost of sales will rise due to product mix and increased profit-sharing expense, and that SG&A will also increase sequentially. Growth engines: All six products rising, UPLIZNA up 191% year over year The six key growth products combined grew 27% year over year. The rare disease portfolio generated $1.6 billion in revenue, up 21% year over year: UPLIZNA revenue was $451 million, up 191% year over year, with U.S. new and continuing patients for generalized myasthenia gravis up 45% sequentially, and launches in 25 markets outside the U.S.; TEPEZZA revenue was $526 million, down 6% year over year, mainly because channel stocking in the prior-year period raised the base, and it has now launched in more than 20 countries outside the U.S. In general medicine, Repatha revenue was $1.085 billion, up 37% year over year, and with the VESALIUS-CV results it is the only PCSK9 inhibitor with Phase III cardiovascular outcomes evidence in both primary and secondary prevention; the company expects more than 3 million new patients worldwide to start treatment this year. EVENITY revenue was $751 million, up 39% year over year, maintaining nearly 60% share of the bone-building agent category in Japan. In inflammation, TEZSPIRE revenue was $538 million, up 43% year over year, and it met the primary endpoint in a Phase III study in eosinophilic esophagitis. In oncology, BLINCYTO revenue was $496 million, up 27% year over year, and IMDELLTRA revenue was $406 million, more than doubling year over year. Patent cliff becomes visible: Prolia and XGEVA decline more than 40% year over year Older products are clearly feeling biosimilar competition: Prolia revenue was $632 million, down 45% year over year; XGEVA revenue was $288 million, down 47% year over year; Otezla revenue was $481 million, down 18% year over year. On the offsetting side, the company's biosimilars portfolio generated $977 million in revenue, up 26% year over year, including $300 million from the EYLEA biosimilar PAVBLU, up 41% year over year; the company disclosed that the next wave of biosimilars for OPDIVO, KEYTRUDA and OCREVUS is in late-stage clinical development. Asked whether Amgen would shrink its biosimilars business to free up capacity for MariTide, CEO Bob Bradway responded that "we evaluate all options, but we are very confident in continuing to be a reliable supplier of high-quality biosimilars," and that the capacity expansion is designed at a scale far larger than what biosimilars require. R&D pipeline: Three Phase III readouts, MariTide completes enrollment in sleep apnea studies In the quarter the company reported three positive Phase III results. Dazodalibep met the primary endpoint in the Phase III OASIS-301 study in systemic Sjgren's syndrome, with the monthly dosing group improving 5.6 points from baseline and the quarterly dosing group improving 5.2 points (placebo-adjusted improvements of 1.8 and 1.4 points, respectively), and also met key secondary endpoints including patient-reported dry mouth; a second Phase III study in symptomatic patients is expected to read out during the year, and management stressed that the two populations were enrolled separately and that it is "difficult to extrapolate directly from the 301 study to the 303 study." TEZSPIRE met both primary endpoints of histological remission and swallowing symptoms in a Phase III study in eosinophilic esophagitis, with efficacy maintained through 52 weeks. Daxdilimab met the primary endpoint in both dose groups in a Phase II study in discoid lupus erythematosus and will advance to Phase III. In weight management, the MARITIDE Phase III program for MariTide completed enrollment in two sleep apnea studies and in the cardiovascular outcomes study during the quarter, and launched the first of three Phase III studies in type 2 diabetes; the company said MariTide has the potential to be the first monthly-dosed weight-loss therapy requiring only 4 to 6 injections per year, and is conducting a study of a home-use autoinjector pen. Below are the details of Amgen's third-quarter earnings call. I. Executive Remarks Casey Capparelli (Vice President, Investor Relations): Thank you, Julianne. Good afternoon, everyone, and welcome to our third-quarter 2026 earnings call. Bob Bradway will host today's call, followed by Murdo Gordon, Jay Bradner and Thomas Dittrich, who will each provide a more comprehensive review of our results. During today's discussion, we will use non-GAAP financial measures to describe performance, and reconciliations are provided in the materials accompanying this call. We will also make forward-looking statements, which are qualified by our safe harbor statement, and please note that actual results may differ materially. Over to you, Bob. Robert Bradway (Chief Executive Officer): Good afternoon, and thank you for joining our call. Our results through the first three quarters of this year reflect the strength of our business across a broad range of products and pipeline molecules. This is exactly the performance our strategy was designed to deliver. Strong commercial and operational execution, together with continued innovation from our R&D organization, further reinforce our confidence in Amgen's ability to deliver durable long-term growth. For the most recent quarter, total revenue grew 8% year over year to $10.4 billion. Our six key growth products grew 27% year over year and accounted for more than 70% of third-quarter product sales. Multiple products in the portfolio delivered double-digit sales growth, and 17 products now have annualized sales exceeding $1 billion based on third-quarter sales. We see significant opportunities to build on this momentum. Many of our medicines target large disease areas with low penetration where most patients remain untreated. Repatha, EVENITY and TEZSPIRE are clear examples. Our strong financial performance gives us both the flexibility to invest in innovation and in capabilities that support future growth, and the ability to deliver attractive returns to shareholders. In the third quarter, we generated $3.7 billion in free cash flow, increased R&D investment 11% year over year, and reinvested $600 million in the business through capex. It was another highly productive quarter for the R&D organization. We reported positive Phase III results for three important programs: IMDELLTRA in small cell lung cancer, where we are working to establish it as a cornerstone therapy; TEZSPIRE in eosinophilic esophagitis, an area of significant unmet need; and dazodalibep in Sjgren's syndrome, where there are currently no approved disease-modifying therapies. I would note that each of these three programs represents an established or potential first-in-class medicine that has the potential to meaningfully change outcomes for patients and to provide Amgen with an additional source of long-term growth. Similarly, our progress reflects the strength of our science and our commitment to exploring new approaches to serious disease. That same focus guides our investment in programs such as MariTide, which is advancing in Phase III development. Jay will discuss these programs and our other clinical progress in more detail later. We are also leveraging technology, data-driven insights and artificial intelligence across Amgen to improve the speed and efficiency with which we discover, develop, manufacture and deliver medicines to patients. We are encouraged by our performance this quarter. Our broad portfolio and continued investment in advancing the pipeline give us confidence in Amgen's ability to deliver durable growth through the next decade and beyond. I want to thank our colleagues around the world for their dedication to our mission of serving patients and for the quality of their work every day. I'll now turn it over to Murdo. Murdo Gordon (Global Commercial Head): Thank you, Bob. Looking back at the third quarter, what struck me most was the significant progress we made across both our late-stage pipeline and our in-line portfolio. We saw important positive clinical data, regulatory milestones and record sales performance for multiple key medicines. The consistency of these results reflects the breadth and strength of Amgen and reinforces our confidence in future growth opportunities. Our commercial performance reflects this progress. Product sales grew 8% year over year, and 17 products now have annualized sales exceeding $1 billion. All six key growth products delivered double-digit growth in the quarter, growing 27% combined year over year, and now account for more than 70% of product sales. Starting with general medicine. Repatha third-quarter sales were $1.1 billion, up 37% year over year. Repatha's momentum continues to accelerate, with U.S. average weekly new-to-brand prescriptions up more than 60% year over year. This growth is being driven by greater urgency to treat patients in secondary prevention and high-risk primary prevention. With the landmark VESALIUS-CV results, Repatha is now the only PCSK9 inhibitor with Phase III cardiovascular outcomes evidence in both primary and secondary prevention. We are seeing deepening penetration and adoption among cardiologists, accelerating use in primary care, and support for using PCSK9 inhibitors without requiring prior ezetimibe use. Backed by Repatha's differentiated outcomes data, new guidelines reinforce the clinical consensus that Repatha should be the preferred choice when further LDL cholesterol lowering is needed on top of statins. This year alone, we expect more than 3 million new patients worldwide to start Repatha. An estimated 100 million patients worldwide still have LDL-C above target, and we are only just beginning to reach this enormous unmet need, which gives us confidence in Repatha's growth potential into the 2030s. EVENITY third-quarter sales grew 39% to $751 million, extending the 38% year-over-year growth of the prior quarter. In the U.S., strong patient demand continues to drive growth, with an expanding prescriber base and deepening adoption among treating physicians. We are increasing investment to expand physician coverage and help more patients access EVENITY. The opportunity remains substantialgiven the serious consequences of osteoporotic fractures: 1 in 2 hip fracture patients never regain their pre-fracture mobility. This underscores the importance of earlier intervention and reinforces our confidence in EVENITY's ability to help more women at very high fracture risk, including those who have not yet fractured. In Japan, EVENITY maintains a leading position in the bone-building agent category with nearly 60% volume share. Updated treatment guidelines and increased use in treatment-naive patients support continued growth and further confirm EVENITY's important role in osteoporosis treatment. Turning to inflammation. TEZSPIRE sales grew 43% year over year to $538 million, driven primarily by strong demand in severe uncontrolled asthma. TEZSPIRE's growth continues to outpace the severe uncontrolled asthma market: U.S. new-to-brand prescriptions grew 15% year over year while the overall market grew 3%. TEZSPIRE captured 34% of new prescriptions among U.S. allergists and continues to gain share among pulmonologists, with substantial room for further penetration. A steady stream of strong clinical data continues to confirm TEZSPIRE's differentiated efficacy across multiple inflammatory diseases. Phase III results in chronic rhinosinusitis with nasal polyps showed improved disease control and reduced need for surgery. More recent positive Phase III results in eosinophilic esophagitis (EOE) showed significant improvements in key measures of disease activity and symptoms, opening another potential new opportunity for TEZSPIRE to help more patients. Turning to rare disease. This portfolio grew 21% year over year to $1.6 billion, reflecting continued momentum from new indications and disciplined execution of international expansion. We see opportunities to extend the reach of these therapies, improve patient outcomes and extend meaningful growth into the next decade. UPLIZNA third-quarter sales grew 191% year over year to $451 million, driven by strong payer demand across all approved indications. UPLIZNA has a highly differentiated clinical profile: excellent efficacy that physicians recognize, combined with a convenient twice-yearly dosing regimen that benefits patients. This profile is supported by broad payer coverage and Amgen's robust patient support services, which help physicians initiate therapy and maintain continuity of treatment. In the U.S., UPLIZNA grew significantly in generalized myasthenia gravis (gMG), with new and continuing patients up 45% sequentially. Adoption is expanding among both biologic-naive patients and those switching from other therapies, reinforcing our confidence in establishing market leadership in this category. In IgG4-related disease, long-term follow-up data from the Phase III study demonstrated the durability of the efficacy profile: during the first year of the open-label extension, no patients who continued on UPLIZNA experienced a flare, and more than 70% achieved complete remission without glucocorticoids. These durable results, together with greater disease awareness and improved diagnosis, support our confidence in helping more patients. UPLIZNA's international expansion continues, and it is now available in 25 markets outside the U.S. As we bring UPLIZNA to more patients globally and advance development in additional autoimmune diseases, we see continued significant growth opportunities. TEPEZZA third-quarter sales were $526 million, down 6% year over year, primarily due to channel stocking in the prior-year period. International adoption continues to expand, and uptake since entering the Japanese market last year has been particularly encouraging. TEPEZZA is now available in more than 20 countries, with plans to enter 3 new markets during the remainder of 2026. Our biosimilars portfolio grew 26% year over year, with third-quarter sales of $977 million. The EYLEA biosimilar PAVBLU grew sales 41% year over year to $300 million. Retina specialists recognize PAVBLU's convenient prefilled syringe format, backed by Amgen's proven capabilities in biosimilar manufacturing and supply. Our next wave of biosimilar candidates targeting EYLEA HD, OPDIVO, KEYTRUDA and OCREVUS is in late-stage clinical development and represents a substantial market opportunity. Turning to innovative oncology. This portfolio grew 21% year over year, with third-quarter sales of $2.1 billion. BLINCYTO sales grew 27% year over year to $496 million. This growth continues to reflect broad prescribing across academic centers and community practices, as well as increased international adoption. BLINCYTO's established role in treating B-cell acute lymphoblastic leukemia demonstrates the strength of our bispecific T-cell engager (BiTE) platform and its ability to deliver meaningful outcomes across different cancers. IMDELLTRA sales more than doubled year over year to $406 million. Behind this commercial momentum is a medicine that has the potential to profoundly change outcomes for small cell lung cancer patients. For decades, these patients and their families have faced limited treatment options and poor survival outcomes, and IMDELLTRA is changing that. The landmark DeLLphi-304 study showed a 40% reduction in risk of death compared with chemotherapy in the second-line setting. IMDELLTRA offers convenient every-two-week dosing after the initial step-up dosing period. We are working to reduce the treatment burden: the FDA recently shortened the recommended monitoring time for the first two doses from 22 to 24 hours to just 6 to 8 hours. Looking ahead, we are advancing alternative dosing regimens and subcutaneous administration, which have the potential to further improve patient convenience and expand access in community settings. Even more exciting is the potential to help patients benefit earlier in their treatment journey. As Jay will detail, we recently announced results from the Phase III DeLLphi-305 study evaluating IMDELLTRA plus IMFINZI as first-line maintenance therapy. I was in the room in Madrid when these data were presented at the European Society for Medical Oncology (ESMO) Congress, and I was deeply moved by the standing ovation; the enthusiasm among oncologists for its potential to significantly extend patients' lives was remarkable. The magnitude of this result cannot be overstateda median overall survival improvement of more than 8 months is an extraordinary advance for patients with this devastating disease. We are working urgently on registration discussions with health authorities and supporting clinical guideline bodies, including NCCN, in their review as quickly as possible so that these findings can be translated into clinical practice as rapidly as possible. We believe IMDELLTRA has the potential to change the treatment landscape for small cell lung cancer and, with subsequent regulatory approvals, to become a cornerstone therapy across multiple stages of the disease. Our portfolio has significant potential for deeper market penetration, additional indications and global expansion. We are confident in extending sustainable growth into the next decade while benefiting more patients around the world. I'll now turn it over to Jay. James Bradner (Head of R&D): Thank you, Murdo, and good afternoon, everyone. This quarter, we reported three positive Phase III results in three serious disease areas: IMDELLTRA in small cell lung cancer; TEZSPIRE in eosinophilic esophagitis; and dazodalibep in Sjgren's syndrome. These results reflect our R&D strategy of focusing on first-in-class and best-in-class medicines for serious diseases with high unmet need. Each advance represents meaningful progress for patients and physicians and carries long-term growth potential. As Murdo noted, IMDELLTRA is our DLL3-targeted bispecific T-cell engager, currently approved in later-line small cell lung cancer and the second approved medicine to emerge from our BiTE platform. At the ESMO Congress, we presented "practice-changing" results for IMDELLTRA from the DeLLphi-305 study, which evaluated IMDELLTRA plus IMFINZI versus IMFINZI alone as first-line maintenance therapy. The addition of IMDELLTRA to IMFINZI extended median overall survival to 21.1 months versus 12.7 months for IMFINZI alone. This result is notable in a difficult clinical setting where existing agents have delivered only limited overall survival improvements. Median follow-up at the data cutoff was 15.9 months, and we will report the final survival benefit as the data mature. Longer 30-month follow-up data from the Phase Ib study of IMDELLTRA plus anti-PD-L1 as first-line maintenance therapy were also presented at ESMO, showing a median overall survival of 37 monthsa result never before seen in small cell lung cancer. The safety profile of IMDELLTRA in DeLLphi-305 was consistent with clinical experience to date. Cytokine release syndrome and ICANS were predominantly low grade and occurred mainly with the first two doses. DeLLphi-305 allows for 1 to 2 hours of monitoring, which can support outpatient administration and broader adoption. Given the transformative benefit observed, we are working to rapidly submit applications to global regulators. If approved for first-line maintenance, 23,000 patients in the U.S. alone could benefitearlier in the treatment journey and for longer duration. We are advancing a broad clinical development program to establish IMDELLTRA as a cornerstone therapy in small cell lung cancer, including evaluation in earlier-stage disease, novel combinations including antibody-drug conjugates (ADCs), and other DLL3-expressing tumors. Turning to TEZSPIRE. It targets TSLPan upstream driver of inflammation in the airways and other tissues. We recently announced positive results from the CROSSING study in eosinophilic esophagitis (EOE). EOE is another epithelial cell-driven eosinophilic inflammatory disease, following severe asthma and chronic rhinosinusitis with nasal polyps. EOE affects more than 470,000 people in the U.S., and nearly half of patients remain inadequately controlled on existing therapies. The Phase III CROSSING study evaluated TEZSPIRE in adolescents and adults with symptomatic, uncontrolled EOE. At week 24, the study met both primary endpoints: improvement in histological remission and improvement in swallowing symptoms compared with placebo. These benefits were maintained through week 52. This is the first time a biologic has shown sustained 52-week efficacy in a placebo-controlled EOE trial. Multiple secondary endpoints were also met, with TEZSPIRE improving measures of underlying inflammation, swallowing symptoms and endoscopic disease activity. Together with every-four-week dosing, these results support TEZSPIRE's potential to become an important treatment option for patients with EOE and reinforce the evidence for targeting TSLP in serious diseases driven by eosinophilic inflammation. For patients with Sjgren's syndrome, we are targeting the CD40 ligand signaling pathway with dazodalibep in two Phase III studies in systemic Sjgren's syndrome and symptomatic Sjgren's syndrome. Sjgren's syndrome can involve multiple organ systems, causing persistent dryness, fatigue and pain. There are currently no approved disease-modifying therapies. In systemic Sjgren's syndrome, we are excited by the positive, clinically meaningful results for dazodalibep in the placebo-controlled Phase III OASIS-301 study. The study met its primary endpoint: the monthly dosing group improved 5.6 points from baseline on SDI and the quarterly dosing group improved 5.2 points, with placebo-adjusted improvements of 1.8 and 1.4 points, respectively, both statistically significant. Treatment effects were observed as early as week 4 and persisted through the end of the study at week 48. Importantly, dazodalibep also met key secondary endpoints including patient-reported dry mouth, with statistically significant improvements in DASPRI and ESSPRI scores in the monthly dosing group. Dazodalibep was generally well tolerated with both monthly and quarterly dosing. We will present detailed data at the ACR Annual Meeting on November 11 and await completion of the second Phase III study in symptomatic Sjgren's syndrome during the year. In addition to these three important Phase III advances, we recently reported positive Phase II data at the EADV Congress for daxdilimab in discoid lupus erythematosus (DLE). Daxdilimab targets ILT7, reducing plasmacytoid dendritic cells, and addresses type 1 interferon-mediated inflammation. DLE can cause permanent scarring, skin pigment changes and hair loss. In this study, both dose groups met the primary endpoint, with improvements in active skin lesions observed as early as week 4 and sustained through week 24. At week 24, daxdilimab improved scores from baseline by 10.2 points in the low-dose group and 9.9 points in the high-dose group, corresponding to placebo-adjusted improvements of 6.0 and 5.7 points, respectively, both statistically significant. Daxdilimab was well tolerated with no serious adverse events reported. Based on these results, we will advance daxdilimab into Phase III development. As you can see, we have been working hard on execution across our late-stage pipeline, and this quarter was highly productive. Elsewhere in the pipeline, we are focused on developing important new medicines in our late-stage pipeline. For prostate cancer patients, we are rapidly advancing Xaluritamig in early and late-stage disease, extending the reach of our T-cell engager platform. For patients with obesity and related diseases, we are advancing a comprehensive Phase III development program for MariTide. This quarter, we completed enrollment in two Phase III sleep apnea studies and the cardiovascular outcomes study, and launched the first of three Phase III studies in type 2 diabetes. MariTide is emerging as the first monthly-dosed obesity therapy, requiring only 4 or 6 doses per year. The MARITIDE program is designed to clarify how individuals initiate and stay on MariTide, and how others switch from other GLP-1 medicines and stay on MariTide. Our goal is to make long-term treatment easier to adhere to, helping patients maintain weight loss and achieve durable health benefits. I thank Amgen colleagues for their unwavering focus on patients and their strong commitment to advancing innovative medicines for serious diseases. I'll now turn it over to Thomas for the financial update. Thomas J. Dittrich (Chief Financial Officer): Thank you, Jay. As you may know, this is my "chapter two" at Amgen. Early in my career I worked here for nearly a decade, alongside Bob and the team. Since then I have served as CFO of three public companies, with responsibilities spanning finance, strategy, transformation and operations. I have also gained experience in a more consumer-oriented healthcare environment and in rare disease. So I return to Amgen with years of knowledge about the company, but also with a fresh perspective shaped by the past 12 years. Today, I am pleased to join my first quarterly earnings call as Amgen's CFO. I look forward to maintaining Amgen's close communication with the investment community and the financial discipline investors expect. My top priorities are straightforward: first, working as a team with colleagues to drive long-term growth through consistent strategy execution and operating efficiency; second, maintaining Amgen's disciplined approach to capital allocation. You should expect continuity herewe will balance investment in the best innovation and future growth with capital returns to shareholders. Now to third-quarter financial results. Strong third-quarter performance further reinforces our confidence in the six key growth products. Together they reflect the breadth and depth of our business and continue to lay a solid foundation for durable growth into the next decade. We continue to deliver strong operating performance while investing in advancing the pipeline. Third-quarter non-GAAP operating margin was 47%. Non-GAAP R&D expense grew 11% year over year, driven primarily by increased investment in research and the early pipeline, including business development activities. We continue to invest in the innovation that will drive future growth, including MariTide, dazodalibep and Xaluritamig, as well as in-line medicines IMDELLTRA, Repatha and UPLIZNA. SG&A expense declined 1% year over year, primarily due to timing of investment, and secondarily to our ongoing productivity initiatives. We generated $3.7 billion in free cash flow, reflecting the continued momentum of the business and enabling us to continue investing in future growth. Quarterly capex was $600 million, directed to U.S. manufacturing sites in North Carolina, Ohio and Puerto Rico. We continue to expect 2026 capex of approximately $2.6 billion to expand manufacturing capacity for commercial growth and prepare for the potential launch of MariTide. In addition, we returned capital to shareholders through a dividend of $2.52 per share, up 6% from the third quarter of 2025. Turning to the business outlook for the remainder of 2026. We are pleased with our execution and are raising our full-year 2026 revenue and non-GAAP EPS guidance ranges. We now expect 2026 total revenue of $38.9 billion to $39.7 billion and non-GAAP earnings per share of $22.90 to $23.70. Let me highlight a few additional guidance points. We now expect 2026 non-GAAP other income and expense to be an expense of $2.0 billion to $2.1 billion. We continue to expect full-year non-GAAP operating margin (as a percentage of product sales) of roughly 45% to 46%. Additionally, looking to the fourth quarter, we expect operating expenses to increase significantly sequentially, consistent with the company's established pattern of higher year-end spending. Specifically, we expect cost of sales as a percentage of sales to rise sequentially due to product mix changes and increased profit-sharing expense; SG&A expense will also rise sequentially due to the third-quarter timing factors I mentioned and continued investment in in-line products. We expect other income of approximately $1.9 billion for the full year. We expect a non-GAAP tax rate of 15% to 16.5%. We expect share repurchases not to exceed $3 billion. Looking to 2027, we do not expect operating margin to step down from the 2026 guidance. We will continue to allocate resources efficiently, balancing growth investment with disciplined expense management. As we close out the year, we remain focused on executing our strategy, advancing our growth products, investing in the best innovation and maintaining the financial discipline that underpins our ability to deliver durable growth into the next decade. I thank all colleagues around the world for their efforts in our mission to serve patients. That concludes the financial update. I'll now turn it back to Bob for questions. II. Q&A Session Operator: (Operator instructions) Our first question comes from Salveen Richter of Goldman Sachs Group, Inc. Salveen Richter (Goldman Sachs Group, Inc. Research): Based on the positive Phase III results in systemic Sjgren's syndrome, how should we think about the readout of the symptomatic patient study and how much confidence to place in it? And could you talk about the overall regulatory path for this program? James Bradner: Thank you, Salveen, this is Jay. We are pleased with the results of the systemic 301 study and the efficacy observedboth the placebo-adjusted improvement on the primary endpoint SDI and the effect on secondary dry mouth symptoms are quite encouraging. But it is difficult to extrapolate directly from 301 to 303, that is, from the systemic study to the symptomatic study. These are two different patient populations, and we conducted the studies independently; it will be important to understand how the 434 patients in the 303 study may be affected. So we will have more to say soon after we see the data in the fourth quarter of this year. As for the regulatory path, this is an area that has become very competitive recentlywhich is good for patients, because there had been almost no progress for many years. Dazodalibep is actually the first therapy to show efficacy in the systemic setting while also acting on symptoms, with effects persisting to the end of the study. We don't have more to say today, but we look forward to careful review of these data. Operator: Our next question comes from Terence Flynn of Morgan Stanley. Terence Flynn (Morgan Stanley Research): Congratulations on all the progress. Thomas, I know you talked about capex investment to prepare for the MariTide launch. Have you considered shrinking the biosimilars business to free up more capacity for this launch? Is that under consideration? And a related question, Jay, do you have access to blinded tolerability data from the ongoing MariTide Phase III trials? Robert Bradway: Terence, I can take that, this is Bob. Obviously, we consider all options when it comes to capacity management. But we are very confident in continuing to be a reliable supplier of high-quality biosimilars. So this is not a burden for us, and our capacity expansion is designed at a scale for larger protein volumes than biosimilars require. As for the other question, Jay, do you want to take a shot? James Bradner: Well, thank you for the question, Terence. In 2026, we have just been conducting the MariTide work with rigorous data generation, and the MariTide studies are being conducted strictly in accordance with good clinical practice. When these studies read out, we will share more information on MariTide's efficacy and tolerability. Operator: Our next question comes from Akash Tewari of Jefferies. Akash Tewari (Jefferies Research): Listening to your team compare the systemic Phase III and Phase II Sjgren's data, one thing I noticed is that your team was surprised by the speed of onset, with effects possibly better than in Phase II. Could you talk about the onset in the systemic trial? And what does it suggest for the upcoming symptomatic study readout? Also please comment on the MARITIME-PEN study. I know you just launched a study of a home-use autoinjector for MariTidewhat gives you confidence to start that now? Do we have any visibility into the dose of the autoinjector that will be used in the study? James Bradner: Thank you, I'll take that. This is Jay. As I just said, we are pleased with dazodalibep's effects in Sjgren's syndrome, but perhaps not surprisedafter all, we are building on very strong Phase II data. The placebo-adjusted SDI improvement of 1.8 points with monthly dosing and 1.4 points with every-12-week dosing is in line with our expectations and is a strong result, and the effect on dry mouth is what we hoped and expected to see. I addressed the extrapolation question earlier, but you asked about onset. This is a potential advantage of molecules targeting active inflammatory signaling pathways such as CD40 and CD40 ligand. We have extensive experience with B-cell depletion. B-cell depletion can in some cases have a delayed onsetalthough with UPLIZNA, we have not experienced that in many diseases. So seeing an effect at week 4 is highly consistent with our mechanistic hypothesis that as a CD40 ligand/CD40 signaling inhibitor it can achieve immediate suppression of B-cell-driven inflammation. And because CD40 is also highly expressed on salivary gland ductal epithelial cells, where it can drive local inflammation through interaction with activated T cells, it makes sense that dazodalibep would show an effect as early as week 4and indeed we observed statistically significant improvement at week 4 that persisted through the end of the study. So thank you for highlighting that feature. For molecules targeting active signaling pathways, faster onset in some settings is a very good property. Robert Bradway: The second question Akash asked was about the autoinjector. Obviously, we have a great deal of experience with autoinjectors, Akash. So I don't think there is anything particularly novel about the study you mentioned. Jay, feel free to add anything. James Bradner: We have been quite consistent that MariTide is ultimately expected to be administered via a patient-friendly, single-chamber handheld autoinjector. As Bob said, we have extensive experience here. We have taken a fairly standard development path and are making good progress. Robert Bradway: Okay, let's go to the next question. And a reminder to everyone, to try to get to as many people as possible tonight, please limit yourself to one question. Casey and his team will remain after the call, and all of us will be available later today to answer your other questions. Operator: Our next question comes from Michael Yee of UBS. Michael Yee (noted as UBS Research): One question for Bob. Bob, in a record period for M&A, Amgen seems to have been quieter on the M&A front. Could you talk about your view? Is it that your "urgency" is low, that you're busy? Maybe you're more interested in what you have in hand? And please talk about whether