AMGEN REPORTS THIRD QUARTER 2022 FINANCIAL RESULTS
Amgen (NASDAQ:AMGN) today announced financial results for the third quarter of 2022
THOUSAND OAKS, Calif., Nov. 3, 2022 /PRNewswire/ -- Amgen (NASDAQ:AMGN) today announced financial results for the third quarter of 2022. Key results include:
"Our medicines generated 8% volume growth in the quarter globally, with 11 products achieving record quarterly sales," said Robert A. Bradway, chairman and chief executive officer. "This growth reflects the strong underlying demand for our medicines and the value they bring to patients."
Non-GAAP EPS has been recast due to an update to our non-GAAP policy effective January 1, 2022, resulting in a $0.59 reduction of previously-reported non-GAAP EPS for the third quarter of 2021. Refer to Non-GAAP Financial Measures below for further discussion.
$Millions, except EPS, dividends paid per share and
percentages
Q3 '22
Q3 '21
YOY Δ
Total Revenues
$ 6,652
$ 6,706
(1 %)
GAAP Operating Income
$ 2,660
$ 2,378
12 %
GAAP Net Income
$ 2,143
$ 1,884
14 %
GAAP EPS
$ 3.98
$ 3.31
20 %
Non-GAAP Operating Income
$ 3,277
$ 3,052
7 %
Non-GAAP Net Income
$ 2,530
$ 2,324
9 %
Non-GAAP EPS
$ 4.70
$ 4.08
15 %
Dividends Paid Per Share
$ 1.94
$ 1.76
10 %
References in this release to "non-GAAP" measures, measures presented "on a non-GAAP basis," "free cash flow" (computed by subtracting capital expenditures from operating cash flow) and "total revenues adjusted for foreign currency impact" (computed by converting our current period local currency product sales using the prior period foreign currency exchange rates and comparing that to our current period product sales) refer to non-GAAP financial measures. Beginning January 1, 2022, the Company's non-GAAP financial measures no longer exclude adjustments for upfront license fees, development milestones and IPR&D expenses of pre-approval programs related to licensing, collaboration and asset acquisition transactions. For purposes of comparability, the non-GAAP financial results for the third quarter of 2021 have been updated to reflect this change. Adjustments to the most directly comparable GAAP financial measures and other items are presented on the attached reconciliations. Refer to Non-GAAP Financial Measures below for further discussion.
Product Sales Performance
Total product sales decreased 1% for the third quarter of 2022 versus the third quarter of 2021. Unit volumes grew 8% but were more than offset by 5% lower net selling price, 2% negative impact from foreign exchange, 1% lower inventory levels and 1% unfavorable changes to estimated sales deductions.
General Medicine
Inflammation
Hematology-Oncology
Established Products
Product Sales Detail by Product and Geographic Region
$Millions, except percentages
Q3 '22
Q3 '21
YOY Δ
US
ROW
TOTAL
TOTAL
TOTAL
Prolia®
$ 590
$ 272
$ 862
$ 803
7 %
EVENITY®
136
65
201
149
35 %
Repatha®
142
167
309
272
14 %
Aimovig®
103
4
107
79
35 %
TEZSPIRE®
55
—
55
—
NM
Otezla®
529
98
627
609
3 %
Enbrel®
1,086
20
1,106
1,289
(14 %)
AMGEVITA™
—
117
117
111
5 %
LUMAKRAS®/LUMYKRAS™
61
14
75
36
*
KYPROLIS®
217
101
318
293
9 %
XGEVA®
363
132
495
517
(4 %)
Vectibix®
106
141
247
200
24 %
Nplate®
162
126
288
273
5 %
BLINCYTO®
84
58
142
125
14 %
MVASI®
139
70
209
274
(24 %)
KANJINTI®
58
14
72
116
(38 %)
Neulasta®
205
42
247
415
(40 %)
NEUPOGEN®
21
14
35
52
(33 %)
EPOGEN®
136
—
136
138
(1 %)
Aranesp®
128
230
358
396
(10 %)
Parsabiv®
61
39
100
61
64 %
Sensipar®/Mimpara™
4
13
17
19
(11 %)
Other products**
80
34
114
93
23 %
Total product sales
$ 4,466
$ 1,771
$ 6,237
$ 6,320
(1 %)
* Change in excess of 100%
** Other products include Corlanor®,AVSOLA®,IMLYGIC® andRIABNI®, as well as sales byGENSENTA andBergamo subsidiaries
NM = not meaningful
Operating Expense, Operating Margin and Tax Rate Analysis
On a GAAP basis:
On a non-GAAP basis:
$Millions, except percentages
GAAP
Non-GAAP
Q3 '22
Q3 '21
YOY Δ
Q3 '22
Q3 '21
YOY Δ
Cost of Sales
$ 1,588
$ 1,609
(1 %)
$ 1,003
$ 997
1 %
% of product sales
25.5 %
25.5 %
— pts
16.1 %
15.8 %
0.3 pts
Research & Development
$ 1,112
$ 1,422
(22 %)
$ 1,096
$ 1,397
(22 %)
% of product sales
17.8 %
22.5 %
(4.7) pts
17.6 %
22.1 %
(4.5) pts
Acquired IPR&D
$ —
$ —
NM
$ —
$ —
NM
% of product sales
— %
— %
NM
— %
— %
NM
Selling, General & Administrative
$ 1,287
$ 1,305
(1 %)
$ 1,276
$ 1,260
1 %
% of product sales
20.6 %
20.6 %
— pts
20.5 %
19.9 %
0.6 pts
Other
$ 5
$ (8)
*
$ —
$ —
NM
Total Operating Expenses
$ 3,992
$ 4,328
(8 %)
$ 3,375
$ 3,654
(8 %)
Operating Margin
operating income as % of product sales
42.6 %
37.6 %
5.0 pts
52.5 %
48.3 %
4.2 pts
Tax Rate
10.4 %
12.6 %
(2.2) pts
12.9 %
13.3 %
(0.4) pts
pts: percentage points
* change in excess of 100%
NM = not meaningful
Cash Flow and Balance Sheet
$Billions, except shares
Q3 '22
Q3 '21
YOY Δ
Operating Cash Flow
$ 3.0
$ 2.4
$ 0.6
Capital Expenditures
$ 0.2
$ 0.2
$ (0.1)
Free Cash Flow
$ 2.8
$ 2.2
$ 0.6
Dividends Paid
$ 1.0
$ 1.0
$ 0.0
Share Repurchases
$ —
$ 1.1
$ (1.1)
Average Diluted Shares (millions)
538
570
(32)
Note: Numbers may not add due to rounding
$Billions
9/30/22
12/31/21
YTD Δ
Cash and Investments
$ 11.5
$ 8.0
$ 3.4
Debt Outstanding
$ 38.7
$ 33.3
$ 5.4
Note: Numbers may not add due to rounding
2022 Guidance
For the full year 2022, the Company now expects:
Third Quarter Product and Pipeline Update
The Company provided the following updates on selected product and pipeline programs:
General Medicine
Repatha
Olpasiran (AMG 890)
AMG 133
Webcast call Monday, November. 7, 2022
Inflammation
Otezla
TEZSPIRE
Rocatinlimab (AMG 451 / KHK4083)
Rozibafusp alfa (AMG 570)
Efavaleukin alfa (AMG 592)
Ordesekimab (AMG 714 / PRV-015)
Oncology
LUMAKRAS/LUMYKRAS
BLINCYTO
Vectibix
Bemarituzumab
Tarlatamab (AMG 757)
AMG 509
AMG 340
AMG 193
Biosimilars
TEZSPIRE is being developed in collaboration with AstraZeneca.
Rocatinlimab, formerly AMG 451 / KHK4083 is being developed in collaboration with KKC.
Ordesekimab formerly AMG 714 and also known as PRV-015 is being developed in collaboration with Provention Bio.
AMG 509 is being developed in collaboration with Xencor.
STELARA is a registered trademark of Janssen Pharmaceutica NV.
EYLEA is a registered trademark of Regeneron Pharmaceuticals, Inc.
SOLIRIS is a registered trademark of Alexion Pharmaceuticals, Inc.
Non-GAAP Financial Measures
In this news release, management has presented its operating results for the third quarters of 2022 and 2021, in accordance with U.S. Generally Accepted Accounting Principles (GAAP) and on a non-GAAP basis. In addition, management has presented its full year 2022 EPS and tax guidance in accordance with GAAP and on a non-GAAP basis. These non-GAAP financial measures are computed by excluding certain items related to acquisitions, divestitures, restructuring and certain other items from the related GAAP financial measures. Beginning January 1, 2022, following industry guidance from the U.S. Securities and Exchange Commission, the Company no longer excludes adjustments for upfront license fees, development milestones and IPR&D expenses of pre-approval programs related to licensing, collaboration and asset acquisition transactions from its non-GAAP financial measures. For purposes of comparability, the non-GAAP financial results for the third quarter of 2021 have been updated to reflect this change. Reconciliations for these non-GAAP financial measures to the most directly comparable GAAP financial measures are included in the news release. Management has presented Free Cash Flow (FCF), which is a non-GAAP financial measure, for the third quarters of 2022 and 2021. FCF is computed by subtracting capital expenditures from operating cash flow, each as determined in accordance with GAAP. Management has also presented Total Revenues Adjusted for Foreign Currency Impact, which is a non-GAAP financial measure, for the third quarter of 2022. Total Revenues Adjusted for Foreign Currency Impact is computed by converting our current period local currency product sales using the prior period foreign currency exchange rates and comparing that to our current period product sales.
The Company believes that its presentation of non-GAAP financial measures provides useful supplementary information to and facilitates additional analysis by investors. The Company uses certain non-GAAP financial measures to enhance an investor's overall understanding of the financial performance and prospects for the future of the Company's ongoing business activities by facilitating comparisons of results of ongoing business operations among current, past and future periods. The Company believes that FCF provides a further measure of the Company's liquidity. Further, the Company believes Total Revenues Adjusted for Foreign Currency Impact provides supplementary information on the Company's product sales performance by excluding changes in foreign currency exchange rates between comparative periods.
The Company uses the non-GAAP financial measures set forth in the news release in connection with its own budgeting and financial planning internally to evaluate the performance of the business, including to allocate resources and to evaluate results relative to incentive compensation targets. The non-GAAP financial measures are in addition to, not a substitute for, or superior to, measures of financial performance prepared in accordance with GAAP.
About Amgen
Amgen is committed to unlocking the potential of biology for patients suffering from serious illnesses by discovering, developing, manufacturing and delivering innovative human therapeutics. This approach begins by using tools like advanced human genetics to unravel the complexities of disease and understand the fundamentals of human biology.
Amgen focuses on areas of high unmet medical need and leverages its expertise to strive for solutions that improve health outcomes and dramatically improve people's lives. A biotechnology pioneer since 1980, Amgen has grown to be one of the world's leading independent biotechnology companies, has reached millions of patients around the world and is developing a pipeline of medicines with breakaway potential.
Amgen is one of the 30 companies that comprise the Dow Jones Industrial Average and is also part of the Nasdaq-100 index. In 2022, Amgen was named one of the "World's Best Employers" by Forbes and one of "America's 100 Most Sustainable Companies" by Barron's.
For more information, visit Amgen.com and follow us on Twitter, LinkedIn, Instagram, TikTok and YouTube.
Forward-Looking Statements
This news release contains forward-looking statements that are based on the current expectations and beliefs of Amgen. All statements, other than statements of historical fact, are statements that could be deemed forward-looking statements, including any statements on the outcome, benefits and synergies of collaborations, or potential collaborations, with any other company (including BeiGene, Ltd., Kyowa-Kirin Co., Ltd., Generate Biomedicines, Inc., Arrakis Therapeutics, Inc., Plexium, Inc., or any collaboration to manufacture therapeutic antibodies against COVID-19), the performance of Otezla® (apremilast) (including anticipated Otezla sales growth and the timing of non-GAAP EPS accretion), the Five Prime Therapeutics, Inc. acquisition, the Teneobio, Inc. acquisition, or the ChemoCentryx, Inc. acquisition as well as estimates of revenues, operating margins, capital expenditures, cash, other financial metrics, expected legal, arbitration, political, regulatory or clinical results or practices, customer and prescriber patterns or practices, reimbursement activities and outcomes, effects of pandemics or other widespread health problems such as the ongoing COVID-19 pandemic on our business, outcomes, progress, and other such estimates and results. Forward-looking statements involve significant risks and uncertainties, including those discussed below and more fully described in the Securities and Exchange Commission reports filed by Amgen, including our most recent annual report on Form 10-K and any subsequent periodic reports on Form 10-Q and current reports on Form 8-K. Unless otherwise noted, Amgen is providing this information as of the date of this news release and does not undertake any obligation to update any forward-looking statements contained in this document as a result of new information, future events or otherwise.
No forward-looking statement can be guaranteed and actual results may differ materially from those we project. Our results may be affected by our ability to successfully market both new and existing products domestically and internationally, clinical and regulatory developments involving current and future products, sales growth of recently launched products, competition from other products including biosimilars, difficulties or delays in manufacturing our products and global economic conditions. In addition, sales of our products are affected by pricing pressure, political and public scrutiny and reimbursement policies imposed by third-party payers, including governments, private insurance plans and managed care providers and may be affected by regulatory, clinical and guideline developments and domestic and international trends toward managed care and healthcare cost containment. Furthermore, our research, testing, pricing, marketing and other operations are subject to extensive regulation by domestic and foreign government regulatory authorities. We or others could identify safety, side effects or manufacturing problems with our products, including our devices, after they are on the market. Our business may be impacted by government investigations, litigation and product liability claims. In addition, our business may be impacted by the adoption of new tax legislation or exposure to additional tax liabilities. If we fail to meet the compliance obligations in the corporate integrity agreement between us and the U.S. government, we could become subject to significant sanctions. Further, while we routinely obtain patents for our products and technology, the protection offered by our patents and patent applications may be challenged, invalidated or circumvented by our competitors, or we may fail to prevail in present and future intellectual property litigation. We perform a substantial amount of our commercial manufacturing activities at a few key facilities, including in Puerto Rico, and also depend on third parties for a portion of our manufacturing activities, and limits on supply may constrain sales of certain of our current products and product candidate development. An outbreak of disease or similar public health threat, such as COVID-19, and the public and governmental effort to mitigate against the spread of such disease, could have a significant adverse effect on the supply of materials for our manufacturing activities, the distribution of our products, the commercialization of our product candidates, and our clinical trial operations, and any such events may have a material adverse effect on our product development, product sales, business and results of operations. We rely on collaborations with third parties for the development of some of our product candidates and for the commercialization and sales of some of our commercial products. In addition, we compete with other companies with respect to many of our marketed products as well as for the discovery and development of new products. Discovery or identification of new product candidates or development of new indications for existing products cannot be guaranteed and movement from concept to product is uncertain; consequently, there can be no guarantee that any particular product candidate or development of a new indication for an existing product will be successful and become a commercial product. Further, some raw materials, medical devices and component parts for our products are supplied by sole third-party suppliers. Certain of our distributors, customers and payers have substantial purchasing leverage in their dealings with us. The discovery of significant problems with a product similar to one of our products that implicate an entire class of products could have a material adverse effect on sales of the affected products and on our business and results of operations. Our efforts to collaborate with or acquire other companies, products or technology, and to integrate the operations of companies or to support the products or technology we have acquired, may not be successful. A breakdown, cyberattack or information security breach of our information technology systems could compromise the confidentiality, integrity and availability of our systems and our data. Our stock price is volatile and may be affected by a number of events. Our business and operations may be negatively affected by the failure, or perceived failure, of achieving our environmental, social and governance objectives. The effects of global climate change and related natural disasters could negatively affect our business and operations. Global economic conditions may magnify certain risks that affect our business. Our business performance could affect or limit the ability of our Board of Directors to declare a dividend or our ability to pay a dividend or repurchase our common stock. We may not be able to access the capital and credit markets on terms that are favorable to us, or at all.
CONTACT: Amgen, Thousand Oaks
Jessica Akopyan, 805-440-5721 (media)
Arvind Sood, 805-447-1060 (investors)
Amgen Inc.
Consolidated Statements of Income - GAAP
(In millions, except per-share data)
(Unaudited)
Three months ended
September 30,
Nine months ended
September 30,
2022
2021
2022
2021
Revenues:
Product sales
$ 6,237
$ 6,320
$ 18,249
$ 18,026
Other revenues
415
386
1,235
1,107
Total revenues
6,652
6,706
19,484
19,133
Operating expenses:
Cost of sales
1,588
1,609
4,659
4,736
Research and development
1,112
1,422
3,110
3,471
Acquired in-process research and development
—
—
—
1,505
Selling, general and administrative
1,287
1,305
3,842
3,943
Other
5
(8)
537
143
Total operating expenses
3,992
4,328
12,148
13,798
Operating income
2,660
2,378
7,336
5,335
Other income (expense):
Interest expense, net
(368)
(296)
(991)
(862)
Other income (expense), net
100
73
(747)
97
Income before income taxes
2,392
2,155
5,598
4,570
Provision for income taxes
249
271
662
576
Net income
$ 2,143
$ 1,884
$ 4,936
$ 3,994
Earnings per share:
Basic
$ 4.01
$ 3.32
$ 9.16
$ 6.98
Diluted
$ 3.98
$ 3.31
$ 9.11
$ 6.93
Weighted-average shares used in calculation of earnings per share:
Basic
535
567
539
572
Diluted
538
570
542
576
Amgen Inc.
Consolidated Balance Sheets - GAAP
(In millions)
September 30,
December 31,
2022
2021
(Unaudited)
Assets
Current assets:
Cash, cash equivalents and marketable securities
$ 11,478
$ 8,037
Trade receivables, net
5,326
4,895
Inventories
4,757
4,086
Other current assets
2,501
2,367
Total current assets
24,062
19,385
Property, plant and equipment, net
5,188
5,184
Intangible assets, net
13,266
15,182
Goodwill
14,845
14,890
Other noncurrent assets
6,339
6,524
Total assets
$ 63,700
$ 61,165
Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable and accrued liabilities
$ 12,788
$ 12,097
Current portion of long-term debt
1,543
87
Total current liabilities
14,331
12,184
Long-term debt
37,161
33,222
Long-term tax liabilities
5,680
6,594
Other noncurrent liabilities
2,875
2,465
Total stockholders' equity
3,653
6,700
Total liabilities and stockholders' equity
$ 63,700
$ 61,165
Shares outstanding
534
558
Amgen Inc.
GAAP to Non-GAAP Reconciliations
(Dollars in millions)
(Unaudited)
Three months ended
September 30,
Nine months ended
September 30,
2022
2021
2022
2021
GAAP cost of sales
$ 1,588
$ 1,609
$ 4,659
$ 4,736
Adjustments to cost of sales:
Acquisition-related expenses (a)
(585)
(606)
(1,779)
(1,827)
Other
—
(6)
—
(11)
Total adjustments to cost of sales
(585)
(612)
(1,779)
(1,838)
Non-GAAP cost of sales
$ 1,003
$ 997
$ 2,880
$ 2,898
GAAP cost of sales as a percentage of product sales
25.5 %
25.5 %
25.5 %
26.3 %
Acquisition-related expenses (a)
(9.4)
(9.6)
(9.7)
(10.1)
Other
0.0
(0.1)
0.0
(0.1)
Non-GAAP cost of sales as a percentage of product sales
16.1 %
15.8 %
15.8 %
16.1 %
GAAP research and development expenses
$ 1,112
$ 1,422
$ 3,110
$ 3,471
Adjustments to research and development expenses:
Acquisition-related expenses (a)
(16)
(25)
(60)
(94)
Non-GAAP research and development expenses
$ 1,096
$ 1,397
$ 3,050
$ 3,377
GAAP research and development expenses as a percentage of product sales
17.8 %
22.5 %
17.0 %
19.3 %
Acquisition-related expenses (a)
(0.2)
(0.4)
(0.3)
(0.6)
Non-GAAP research and development expenses as a percentage of product sales
17.6 %
22.1 %
16.7 %
18.7 %
GAAP selling, general and administrative expenses
$ 1,287
$ 1,305
$ 3,842
$ 3,943
Adjustments to selling, general and administrative expenses:
Acquisition-related expenses (a)
(11)
(16)
(40)
(67)
Other
—
(29)
—
(45)
Total adjustments to selling, general and administrative expenses
(11)
(45)
(40)
(112)
Non-GAAP selling, general and administrative expenses
$ 1,276
$ 1,260
$ 3,802
$ 3,831
GAAP selling, general and administrative expenses as a percentage of product sales
20.6 %
20.6 %
21.1 %
21.9 %
Acquisition-related expenses (a)
(0.1)
(0.2)
(0.3)
(0.4)
Other
0.0
(0.5)
0.0
(0.2)
Non-GAAP selling, general and administrative expenses as a percentage of product sales
20.5 %
19.9 %
20.8 %
21.3 %
GAAP operating expenses
$ 3,992
$ 4,328
$ 12,148
$ 13,798
Adjustments to operating expenses:
Adjustments to cost of sales
(585)
(612)
(1,779)
(1,838)
Adjustments to research and development expenses
(16)
(25)
(60)
(94)
Adjustments to selling, general and administrative expenses
(11)
(45)
(40)
(112)
Certain charges pursuant to our cost savings initiatives
8
(1)
7
(129)
Certain other expenses (b)
(13)
9
(544)
(14)
Total adjustments to operating expenses
(617)
(674)
(2,416)
(2,187)
Non-GAAP operating expenses
$ 3,375
$ 3,654
$ 9,732
$ 11,611
Three months ended
September 30,
Nine months ended
September 30,
2022
2021
2022
2021
GAAP operating income
$ 2,660
$ 2,378
$ 7,336
$ 5,335
Adjustments to operating expenses
617
674
2,416
2,187
Non-GAAP operating income
$ 3,277
$ 3,052
$ 9,752
$ 7,522
GAAP operating income as a percentage of product sales
42.6 %
37.6 %
40.2 %
29.6 %
Adjustments to cost of sales
9.4
9.7
9.7
10.2
Adjustments to research and development expenses
0.2
0.4
0.3
0.6
Adjustments to selling, general and administrative expenses
0.1
0.7
0.3
0.6
Certain charges pursuant to our cost savings initiatives
0.0
0.0
0.0
0.7
Certain other expenses (b)
0.2
(0.1)
2.9
0.0
Non-GAAP operating income as a percentage of product sales
52.5 %
48.3 %
53.4 %
41.7 %
GAAP other income (expense), net
$ 100
$ 73
$ (747)
$ 97
Adjustments to other income (expense), net:
Equity method investment basis difference amortization
47
44
143
128
Net (gains)/losses from equity investments
(150)
(191)
401
(335)
Total adjustments to other income (expense), net
(103)
(147)
544
(207)
Non-GAAP other income (expense), net
$ (3)
$ (74)
$ (203)
(110)
GAAP income before income taxes
$ 2,392
$ 2,155
$ 5,598
$ 4,570
Adjustments to income before income taxes:
Adjustments to operating expenses
617
674
2,416
2,187
Adjustments to other income (expense), net
(103)
(147)
544
(207)
Total adjustments to income before income taxes
514
527
2,960
1,980
Non-GAAP income before income taxes
$ 2,906
$ 2,682
$ 8,558
$ 6,550
GAAP provision for income taxes
$ 249
$ 271
$ 662
$ 576
Adjustments to provision for income taxes:
Income tax effect of the above adjustments (c)
122
58
527
466
Other income tax adjustments (d)
5
29
1
17
Total adjustments to provision for income taxes
127
87
528
483
Non-GAAP provision for income taxes
$ 376
$ 358
$ 1,190
$ 1,059
GAAP tax as a percentage of income before taxes
10.4 %
12.6 %
11.8 %
12.6 %
Adjustments to provision for income taxes:
Income tax effect of the above adjustments (c)
2.3
(0.3)
2.1
3.3
Other income tax adjustments (d)
0.2
1.0
0.0
0.3
Total adjustments to provision for income taxes
2.5
0.7
2.1
3.6
Non-GAAP tax as a percentage of income before taxes
12.9 %
13.3 %
13.9 %
16.2 %
GAAP net income
$ 2,143
$ 1,884
$ 4,936
$ 3,994
Adjustments to net income:
Adjustments to income before income taxes, net of the income tax effect
392
469
2,433
1,514
Other income tax adjustments (d)
(5)
(29)
(1)
(17)
Total adjustments to net income
387
440
2,432
1,497
Non-GAAP net income
$ 2,530
$ 2,324
$ 7,368
$ 5,491
Note: Numbers may not add due to rounding
Amgen Inc.
GAAP to Non-GAAP Reconciliations
(In millions, except per-share data)
(Unaudited)
The following table presents the computations for GAAP and non-GAAP diluted earnings per share:
Three months ended
September 30, 2022
Three months ended
September 30, 2021
GAAP
Non-GAAP
GAAP
Non-GAAP
Net income
$ 2,143
$ 2,530
$ 1,884
$ 2,324
Weighted-average shares for diluted EPS
538
538
570
570
Diluted EPS
$ 3.98
$ 4.70
$ 3.31
$ 4.08
Nine months ended
September 30, 2022
Nine months ended
September 30, 2021
GAAP
Non-GAAP
GAAP
Non-GAAP
Net income
$ 4,936
$ 7,368
$ 3,994
$ 5,491
Weighted-average shares for diluted EPS
542
542
576
576
Diluted EPS
$ 9.11
$ 13.59
$ 6.93
$ 9.53
(a)
The adjustments related primarily to noncash amortization of intangible assets from business acquisitions.
(b)
For the three months ended September 30, 2022, the adjustments related primarily to an impairment-related charge associated with an intangible asset acquired in a business combination. For the nine months ended September 30, 2022, the adjustments related primarily to cumulative foreign currency translation adjustments from a nonstrategic divestiture. For the three and nine months ended September 30, 2021, the adjustments related primarily to the change in fair values of contingent consideration liabilities.
(c)
The tax effect of the adjustments between our GAAP and non-GAAP results takes into account the tax treatment and related tax rate(s) that apply to each adjustment in the applicable tax jurisdiction(s). Generally, this results in a tax impact at the U.S. marginal tax rate for certain adjustments, including the majority of amortization of intangible assets, whereas the tax impact of other adjustments, including restructuring initiatives, depends on whether the amounts are deductible in the respective tax jurisdictions and the applicable tax rate(s) in those jurisdictions. Due to these factors, the effective tax rate for the adjustments to our GAAP income before income taxes, for the three and nine months ended September 30, 2022, were 23.7% and 17.8%, respectively, compared to 11.0% and 23.5% for the corresponding period of the prior year.
(d)
The adjustments related to certain acquisition items, prior period and other items excluded from GAAP earnings.
Amgen Inc.
Reconciliations of Cash Flows
(In millions)
(Unaudited)
Three months ended
September 30,
Nine months ended
September 30,
2022
2021
2022
2021
Net cash provided by operating activities
$ 2,978
$ 2,418
$ 7,072
$ 6,453
Net cash (used in) provided by investing activities
(267)
73
(2,571)
963
Net cash provided by (used in) financing activities
1,588
2,848
(2,988)
(1,713)
Increase in cash and cash equivalents
4,299
5,339
1,513
5,703
Cash and cash equivalents at beginning of period
5,203
6,630
7,989
6,266
Cash and cash equivalents at end of period
$ 9,502
$ 11,969
$ 9,502
$ 11,969
Three months ended
September 30,
Nine months ended
September 30,
2022
2021
2022
2021
Net cash provided by operating activities
$ 2,978
$ 2,418
$ 7,072
$ 6,453
Capital expenditures
(160)
(242)
(596)
(593)
Free cash flow
$ 2,818
$ 2,176
$ 6,476
$ 5,860
Amgen Inc.
Reconciliation of Total Revenues Adjusted for Foreign Currency Impact
(Dollars in millions)
(Unaudited)
Three months ended
September 30,
2022
2021
Change
FX impact $
(a)
Three months
ended
September
30, 2022
excluding FX
FX impact %
(a)
Change
excluding FX
Total Revenues
$ 6,652
$ 6,706
(1 %)
$ (160)
$ 6,812
(2 %)
2 %
(a)
Foreign currency impact was calculated by converting our current period local currency Product sales using the prior period foreign currency exchange rates and comparing that to our current period Product sales.
Amgen Inc.
Reconciliation of GAAP EPS Guidance to Non-GAAP
EPS Guidance for the Year Ending December 31, 2022
(Unaudited)
GAAP diluted EPS guidance
$ 11.46
—
$ 12.17
Known adjustments to arrive at non-GAAP*:
Acquisition-related expenses (a)
4.08
—
4.19
Loss on divestiture (b)
1.04
Net losses from equity investments
0.58
Other
(0.02)
Non-GAAP diluted EPS guidance
$ 17.25
—
$ 17.85
* The known adjustments are presented net of their related tax impact, which amount to approximately $1.29 - $1.30 per share.
(a)
The adjustments relate primarily to noncash amortization of intangible assets acquired in business acquisitions.
(b)
The adjustment primarily relates to a cumulative foreign currency translation adjustment from a nonstrategic divestiture.
Our GAAP diluted EPS guidance does not include the effect of GAAP adjustments triggered by events that may occur subsequent to this press release such as acquisitions, divestitures, asset impairments, litigation, changes in fair value of our contingent consideration obligations and changes in fair value of our equity investments. The GAAP adjustments from the acquisition of ChemoCentryx, Inc. are included in the GAAP diluted EPS guidance.
Reconciliation of GAAP Tax Rate Guidance to Non-GAAP
Tax Rate Guidance for the Year Ending December 31, 2022
(Unaudited)
GAAP tax rate guidance
11.0 %
—
12.5 %
Tax rate of known adjustments discussed above
2.0 %
—
2.5 %
Non-GAAP tax rate guidance
13.5 %
—
14.5 %
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SOURCE Amgen
