JOHNSON & JOHNSON

JNJ

Business Summary

Johnson & Johnson operates in the healthcare field, focusing on products related to human health and well-being, and conducts business in virtually all countries of the world. The Company is organized into two business segments: Innovative Medicine and MedTech. The Innovative Medicine segment focuses on therapeutic areas including Oncology, Immunology, Neuroscience, Pulmonary Hypertension, Infectious Diseases, and Cardiovascular and Metabolism. The MedTech segment includes a broad portfolio of products used in Cardiovascular, Orthopaedics, Surgery, and Vision fields. The Company faces substantial competition in its two operating segments and in all geographic markets, competing on the basis of cost-effectiveness, technological innovations, intellectual property rights, product performance, pricing, and availability. Competition in research, involving the development and improvement of new and existing products and processes, is particularly significant.

The Company competes with companies both locally and globally in all product lines. The competitive environment requires substantial investments in continuing research. The Company's subsidiaries face patent challenges from third parties seeking to manufacture and market generic and biosimilar versions of key pharmaceutical products prior to expiration of applicable patents. Sales of the Company's largest product, collectively DARZALEX and DARZALEX FASPRO, accounted for approximately 15.0% ¹ of total revenues for fiscal 2025. Sales of STELARA accounted for approximately 6.5% ² of total revenues, and sales of TREMFYA accounted for approximately 5.5% ³ of total revenues for fiscal 2025. The Company expects continued launches of biosimilar versions of STELARA globally which will continue to negatively impact sales of STELARA.

The Company generates revenue through the research, development, manufacture, and sale of a broad range of products in the healthcare field. Innovative Medicine products are distributed directly to retailers, wholesalers, distributors, hospitals and healthcare professionals for prescription use. MedTech products are distributed to wholesalers, hospitals and retailers, and are used principally in the professional fields by physicians, nurses, hospitals, eye care professionals and clinics. The Company also earns profit-share payments through collaborative arrangements of certain products, which are included in sales to customers. Profit-share payments were less than 2.0% ⁴ of total revenues in fiscal years 2025, 2024 and 2023.

The Innovative Medicine segment reported sales of $60.4 billion ⁵ in 2025, an increase of 6.0% ⁶ from 2024. Key products include DARZALEX, which generated $14.351 billion ⁷ in 2025, STELARA at $6.078 billion ⁸, TREMFYA at $5.155 billion ⁹, and CARVYKTI at $1.887 billion ¹⁰. The Oncology therapeutic area achieved sales of $25.380 billion ¹¹ in 2025, representing an increase of 22.1% ¹². Immunology products sales were $15.728 billion ¹³ in 2025, a decline of 11.8% ¹⁴ primarily due to the decline of STELARA sales driven by biosimilar competition and Medicare Part D redesign. Neuroscience products achieved sales of $7.837 billion ¹⁵ in 2025, an increase of 10.1% ¹⁶. Pulmonary Hypertension products achieved sales of $4.437 billion ¹⁷, an increase of 3.6% ¹⁸. Infectious disease products sales were $3.241 billion ¹⁹ in 2025, a decline of 4.6% ²⁰. Cardiovascular/Metabolism/Other products achieved sales of $3.778 billion ²¹, an increase of 6.1% ²².

The MedTech segment reported sales of $33.8 billion ²³ in 2025, an increase of 6.1% ²⁴ from 2024. The Surgery franchise achieved sales of $10.137 billion ²⁵ in 2025, an increase of 3.0% ²⁶. The Orthopaedics franchise achieved sales of $9.258 billion ²⁷ in 2025, an increase of 1.1% ²⁸. The Cardiovascular franchise achieved sales of $8.928 billion ²⁹ in 2025, an increase of 15.8% ³⁰. The Vision franchise achieved sales of $5.468 billion ³¹ in 2025, an increase of 6.3% ³².

In fiscal 2025, the Company initiated a restructuring program of its Surgery franchise within the MedTech segment with a pre-tax restructuring expense of $205 million ³³. The estimated costs of the total program are between $0.9 billion - $1.0 billion ³⁴. In October 2025, the Company announced its intention to separate its Orthopaedics business with a targeted completion within 18 to 24 months ³⁵ after the initial announcement. On April 2, 2025, the Company acquired Intra-Cellular Therapies for approximately $14.5 billion ³⁶. In the fiscal first quarter of 2025, the Company issued senior unsecured notes for a total of $9.2 billion ³⁷. Cash dividends paid were $5.14 per share ³⁸ in 2025. The Company repurchased $5.953 billion ³⁹ of common stock in 2025.

In 2025, worldwide sales increased 6.0% ⁴⁰ to $94.2 billion ⁴¹ as compared to an increase of 4.3% ⁴² in 2024. Net earnings from continuing operations were $26.804 billion ⁴³ in 2025 compared to $14.066 billion ⁴⁴ in 2024. Diluted earnings per share from continuing operations were $11.03 ⁴⁵ in 2025 versus $5.79 ⁴⁶ in 2024. Cash flow from operations was $24.5 billion ⁴⁷ in 2025. Cash and cash equivalents were $19.7 billion ⁴⁸ at the end of 2025 as compared to $24.1 billion ⁴⁹ at the end of 2024.

Business Outlook

A major growth vector is the Innovative Medicine pipeline, with several regulatory submissions and approvals for new drugs and additional indications in 2025. The Company advanced its pipeline with approvals including DARZALEX for frontline multiple myeloma transplant ineligible (CEPHEUS) and as subcutaneous monotherapy for high-risk smoldering multiple myeloma (AQUILA), ICOTYDE for Psoriasis, IMAAVY for Generalized Myasthenia Gravis, and TREMFYA for Ulcerative Colitis and Crohn's Disease. New products introduced within the past five years accounted for approximately 25% ⁵⁰ of 2025 sales. The Company invested $14.7 billion ⁵¹ in research and development in 2025, reflecting management's commitment to create life-enhancing innovations.

Another growth vector is the MedTech segment, particularly the Cardiovascular franchise which achieved sales of $8.928 billion ⁵² in 2025, an increase of 15.8% ⁵³. Growth was driven by Electrophysiology, Abiomed, and Shockwave. Electrophysiology growth was driven by procedure growth, new product performance and commercial execution. Abiomed sales reflect the continued strong adoption of Impella 5.5 and Impella CP. Shockwave sales growth was driven by Coronary and Peripheral portfolios and new product launches. The Vision franchise also grew 6.3% ⁵⁴ driven by market growth and strong performance in the ACUVUE OASYS 1-Day family of products.

The Company's cost of products sold increased as a percent to sales driven by unfavorable product mix from the decline of STELARA sales and unfavorable transactional currency in the Innovative Medicine business, and tariffs, unfavorable transactional currency and macroeconomic factors in the MedTech business. Selling, Marketing and Administrative Expenses decreased as a percent to sales driven by corporate administrative expense rationalization and planned leverage in the Innovative Medicine business, partially offset by increased investment related to the acquisition of Intra-Cellular (CAPLYTA). Research and Development expense decreased as a percent to sales primarily driven by acquired in-process research and development expense of $1.25 billion ⁵⁵ to secure the global rights to the NM26 bispecific antibody (Yellow Jersey acquisition) in 2024, and leverage resulting from investment prioritization in the Innovative Medicine business.

The Company operates 63 manufacturing facilities ⁵⁶ as well as sourcing from thousands of suppliers around the world. The Company relies on third parties to manufacture and supply certain raw materials, component parts and products. The Company has a policy of only entering into contracts with parties that have at least an investment grade credit rating. The Company maintains credit support agreements with certain derivative counterparties establishing collateral thresholds based on respective credit ratings and netting agreements. As of December 28, 2025, the Company had approximately 138,200 ⁵⁷ employees worldwide.

In 2025, $14.7 billion ⁵⁸ was invested in research and development. Additions to property, plant and equipment were $4.832 billion ⁵⁹ in 2025. Cash dividends paid were $5.14 per share ⁶⁰ in 2025, and the Company increased its dividend in 2025 for the 63rd ⁶¹ consecutive year. On January 2, 2026, the Board of Directors declared a regular cash dividend of $1.30 per share ⁶², payable on March 10, 2026. The Company repurchased $5.953 billion ⁶³ of common stock in 2025. In June 2025, the Company secured a new 364-day Credit Facility of $10 billion ⁶⁴, which expires on June 24, 2026.

The Company faces pricing pressures from trends toward healthcare cost containment, including consolidation among healthcare providers and government pressure to reduce costs. The Inflation Reduction Act of 2022 (IRA) has changed Medicare Part D benefit design and has subjected certain of the Company's products to government-established pricing beginning in 2026. In 2023, CMS published the first Selected Drug list, which includes XARELTO and STELARA as well as IMBRUVICA. The Company expects generic competition for OPSUMIT in 2026, which would likely result in a significant reduction in future sales. The Company also expects continued launches of biosimilar versions of STELARA globally which will continue to negatively impact sales of STELARA.

The Company faces significant challenges from patent expirations and competition. Third parties have filed biologics license applications seeking approval to market biosimilar versions of STELARA around the globe. At least two biosimilars are pursuing regulatory approval for a SIMPONI biosimilar in the United States. The Company is also subject to risks from global operations, including foreign currency exchange rate fluctuations, as approximately 43% ⁶⁵ of the Company's sales occurred outside of the U.S. in fiscal 2025. The Company has accounted for operations in Argentina, Turkey, Venezuela and Egypt as highly inflationary. The Company is also exposed to risks from the planned separation of its Orthopaedics business, which may not be completed on the terms or timeline currently contemplated.

Risk Factors

The Company faces substantial competition and loss of patent exclusivity, which for key pharmaceutical products often leads to a substantial reduction in sales as competitors gain regulatory approval for generic and biosimilar products. Sales of STELARA, which accounted for approximately 6.5% ⁶⁶ of total revenues in fiscal 2025, are expected to continue to be negatively impacted by biosimilar competition. The Company is subject to significant legal proceedings, including numerous lawsuits arising out of the use of body powders containing talc, and has accrued approximately $3.4 billion ⁶⁷ related to talc matters as of December 28, 2025. The Company is also subject to pricing pressures from healthcare reforms, including the Inflation Reduction Act of 2022, which has subjected certain products like XARELTO and STELARA to government-established pricing beginning in 2026. The Company operates globally and faces foreign currency exchange risk, with approximately 43% ⁶⁸ of sales occurring outside the U.S. in fiscal 2025, and a 1% change in the value of the U.S. Dollar would impact translation of foreign sales by approximately $0.4 billion ⁶⁹ and net income by approximately $0.2 billion ⁷⁰.

Management Priorities

Management's message emphasizes that with Our Credo as the foundation, the Company believes health is everything. The Company's strength in healthcare innovation empowers it to build a world where complex diseases are prevented, treated, and cured, where treatments are smarter and less invasive, and solutions are personal. Management states that new products introduced within the past five years accounted for approximately 25% ⁷¹ of 2025 sales. In 2025, $14.7 billion ⁷² was invested in research and development reflecting management's commitment to create life-enhancing innovations and to create value through partnerships. The Company's approximately 138,200 ⁷³ employees are critical drivers of the Company's success. Management's strategic priorities include leveraging extensive resources across the enterprise to innovate and execute with excellence, ensuring the Company can remain focused on addressing the unmet needs of society every day and invest for an enduring impact, ultimately delivering value to its patients, consumers and healthcare professionals, employees, communities and shareholders.

View Source Annual Report on SEC.gov ↗

References

[1] Item 1, Business — Patents
[2] Item 1, Business — Patents
[3] Item 1, Business — Patents
[4] Item 8, Note 1 — Summary of significant accounting policies, Revenue recognition
[5] Item 7, MD&A — Analysis of sales by business segments, Innovative Medicine segment
[6] Item 7, MD&A — Analysis of sales by business segments, Innovative Medicine segment
[7] Item 7, MD&A — Major Innovative Medicine therapeutic area sales
[8] Item 7, MD&A — Major Innovative Medicine therapeutic area sales
[9] Item 7, MD&A — Major Innovative Medicine therapeutic area sales
[10] Item 7, MD&A — Major Innovative Medicine therapeutic area sales
[11] Item 7, MD&A — Major Innovative Medicine therapeutic area sales
[12] Item 7, MD&A — Major Innovative Medicine therapeutic area sales
[13] Item 7, MD&A — Major Innovative Medicine therapeutic area sales
[14] Item 7, MD&A — Major Innovative Medicine therapeutic area sales
[15] Item 7, MD&A — Major Innovative Medicine therapeutic area sales
[16] Item 7, MD&A — Major Innovative Medicine therapeutic area sales
[17] Item 7, MD&A — Major Innovative Medicine therapeutic area sales
[18] Item 7, MD&A — Major Innovative Medicine therapeutic area sales
[19] Item 7, MD&A — Major Innovative Medicine therapeutic area sales
[20] Item 7, MD&A — Major Innovative Medicine therapeutic area sales
[21] Item 7, MD&A — Major Innovative Medicine therapeutic area sales
[22] Item 7, MD&A — Major Innovative Medicine therapeutic area sales
[23] Item 7, MD&A — Analysis of sales by business segments, MedTech segment
[24] Item 7, MD&A — Analysis of sales by business segments, MedTech segment
[25] Item 7, MD&A — Major MedTech franchise sales
[26] Item 7, MD&A — Major MedTech franchise sales
[27] Item 7, MD&A — Major MedTech franchise sales
[28] Item 7, MD&A — Major MedTech franchise sales
[29] Item 7, MD&A — Major MedTech franchise sales
[30] Item 7, MD&A — Major MedTech franchise sales
[31] Item 7, MD&A — Major MedTech franchise sales
[32] Item 7, MD&A — Major MedTech franchise sales
[33] Item 7, MD&A — Restructuring
[34] Item 7, MD&A — Restructuring
[35] Item 1, Business — Segments of business, MedTech
[36] Item 7, MD&A — Liquidity and capital resources
[37] Item 7, MD&A — Liquidity and capital resources
[38] Item 7, MD&A — Dividends
[39] Item 8, Consolidated Statements of Cash Flows
[40] Item 7, MD&A — Results of operations, Analysis of consolidated sales
[41] Item 7, MD&A — Results of operations, Analysis of consolidated sales
[42] Item 7, MD&A — Results of operations, Analysis of consolidated sales
[43] Item 8, Consolidated Statements of Earnings
[44] Item 8, Consolidated Statements of Earnings
[45] Item 8, Consolidated Statements of Earnings
[46] Item 8, Consolidated Statements of Earnings
[47] Item 8, Consolidated Statements of Cash Flows
[48] Item 8, Consolidated Balance Sheets
[49] Item 8, Consolidated Balance Sheets
[50] Item 7, MD&A — Management's objectives
[51] Item 7, MD&A — Management's objectives
[52] Item 7, MD&A — Major MedTech franchise sales
[53] Item 7, MD&A — Major MedTech franchise sales
[54] Item 7, MD&A — Major MedTech franchise sales
[55] Item 7, MD&A — Research and development expense
[56] Item 2, Properties
[57] Item 1, Business — Employees and human capital management
[58] Item 7, MD&A — Management's objectives
[59] Item 8, Consolidated Statements of Cash Flows
[60] Item 7, MD&A — Dividends
[61] Item 7, MD&A — Dividends
[62] Item 7, MD&A — Dividends
[63] Item 8, Consolidated Statements of Cash Flows
[64] Item 7, MD&A — Financing and market risk
[65] Item 1A, Risk factors — Risks related to financial and economic market conditions
[66] Item 1, Business — Patents
[67] Item 7, MD&A — Liquidity and capital resources
[68] Item 1A, Risk factors — Risks related to financial and economic market conditions
[69] Item 7, MD&A — Economic and market factors
[70] Item 7, MD&A — Economic and market factors
[71] Item 7, MD&A — Management's objectives
[72] Item 7, MD&A — Management's objectives
[73] Item 7, MD&A — Management's objectives
[74] Item 8, Consolidated Statements of Earnings
[75] Item 8, Consolidated Statements of Earnings
[76] Item 8, Consolidated Statements of Earnings
[77] Item 8, Consolidated Statements of Earnings
[78] Item 8, Consolidated Statements of Earnings
[79] Item 8, Consolidated Statements of Earnings
[80] Item 8, Consolidated Statements of Earnings
[81] Item 8, Consolidated Statements of Earnings
[82] Item 8, Consolidated Statements of Earnings
[83] Item 8, Consolidated Statements of Earnings
[84] Item 8, Consolidated Statements of Earnings
[85] Item 7, MD&A — Provision for Taxes on Income
[86] Item 7, MD&A — Provision for Taxes on Income
[87] Item 8, Consolidated Statements of Cash Flows
[88] Item 8, Consolidated Balance Sheets
[89] Item 8, Consolidated Balance Sheets
[90] Item 7, MD&A — Liquidity and capital resources
[91] Item 7, MD&A — Liquidity and capital resources
[92] Item 7, MD&A — Liquidity and capital resources
[93] Item 7, MD&A — Liquidity and capital resources
[94] Item 7, MD&A — Liquidity and capital resources
[95] Item 7, MD&A — Income before tax by segment
[96] Item 7, MD&A — Income before tax by segment
[97] Item 7, MD&A — Income before tax by segment
[98] Item 7, MD&A — Income before tax by segment
[99] Item 7, MD&A — Other (Income) Expense, Net
[100] Item 7, MD&A — Other (Income) Expense, Net
[101] Item 7, MD&A — Other (Income) Expense, Net
[102] Item 7, MD&A — Other (Income) Expense, Net

Analysis on 6/8/2026

Recent Material Events

2026-07-29Material Event

Johnson & Johnson completed the acquisition of Firefly Bio for $1 billion in cash and entered into a strategic collaboration with Sail Biomedicines, including an equity investment and an exclusive option to acquire Sail for $2.58 billion. These transactions are expected to dilute adjusted operational EPS and adjusted EPS by approximately $0.64 in 2026 ($0.46 from Firefly, $0.18 from Sail) and $1.36 in 2027. Consequently, the company updated its full-year 2026 guidance, lowering the midpoint for adjusted operational EPS to $10.94 (from $11.58), adjusted sales growth to a 6.2%-6.8% range, and estimated reported sales to a $100.8B-$101.4B range. Johnson & Johnson is a diversified healthcare company engaged in the research, development, manufacture, and sale of products in the pharmaceutical, medical devices, and consumer health sectors.

View filing ↗

2026-07-27Material Event

Johnson & Johnson announced a comprehensive resolution agreement for its remaining ovarian talc litigation, conditioned on at least 95% participation by claimants. The company committed $5.5 billion to settle these claims through per-claim payments, with the first tranche capped at $3 billion in 2027 and no further payments due before 2028. This settlement follows a favorable Multi-District Litigation court ruling on specific causation that undermined the plaintiffs' scientific evidence. Johnson & Johnson operates as a global healthcare company developing innovative medicines, medical devices, and consumer health products.

View filing ↗

2026-07-15Material Event

Johnson & Johnson reported second-quarter 2026 sales of $25.3 billion, a 6.6% increase over the prior year, with adjusted EPS of $2.90. The company raised its full-year 2026 guidance, increasing estimated reported sales to a midpoint of $101.1 billion and adjusted EPS guidance by $0.13 to a midpoint of $11.68. Key growth drivers included the Innovative Medicine segment, specifically oncology products like Darzalex and Carvykti. The company also announced a new supply chain restructuring program in the Innovative Medicine segment with estimated costs between $650 million and $750 million to be completed by 2029. The company operates in the healthcare industry, specializing in innovative medicine and medical technology.

View filing ↗

2026-04-28Material Event

Johnson & Johnson shareholders elected all 12 director nominees and approved executive compensation and the appointment of PricewaterhouseCoopers LLP as auditor at the company's 2026 Annual Meeting. A shareholder proposal to mandate an independent board chair was defeated, receiving 406,353,048 votes in favor and 1,326,857,173 votes against.

View filing ↗

2025-09-09Material Event

Johnson & Johnson has elected John Morikis to its Board of Directors, effective September 8, 2025. Mr. Morikis, the former Executive Chairman, President, and CEO of The Sherwin-Williams Company, will also serve on the company's Audit Committee and Compensation & Benefits Committee.

View filing ↗