Daiichi Sankyo Company, Limited

Q3 FY2025 revenue was JPY 1,533.5 billion, up JPY 165.9 billion or 12.1% YoY. Core operating profit was JPY 249.2 billion, up JPY 20.2 billion or 8.8% YoY; operating profit was JPY 233.8 billion, down JPY 14.5 billion or 5.9% YoY; profit attributable to owners of the company was JPY 217.4 billion, up JPY 8.8 billion or 4.2% YoY. Cost of sales increased by JPY 13.8 billion, SG&A by JPY 93.7 billion, and R&D by JPY 38.1 billion. ENHERTU global product sales were JPY 506.8 billion, up JPY 102.4 billion YoY; DATROWAY global product sales were JPY 31.6 billion, and the full-year DATROWAY sales forecast was raised to JPY 47 billion from the October forecast. Management said there was no change to the FY2025 consolidated earnings forecast from the October announcement, and no change in total revenue from that update.

The CEO/lead executive team emphasized that ENHERTU and DATROWAY are continuing to scale, with strong commercial momentum and expanding indications driving the quarter. They also highlighted guideline additions and regulatory progress across regions as evidence that the franchises are broadening beyond current launches. Tone-wise, management was upbeat on product momentum but careful not to overstate near-term forecast changes outside DATROWAY.

Ogawa said revenue growth was driven by oncology performance, partnership upfronts and milestones, including development milestone income from AstraZeneca and a second upfront payment from U.S. Merck recorded as sales revenue. He attributed the JPY 20.2 billion increase in core operating profit to higher revenue, partly offset by higher SG&A from profit sharing with AstraZeneca and higher R&D tied to 5DXd ADC development, while noting no additional major temporary expenses in Q3. He also broke out temporary items that weighed on profit attributable to owners, including a JPY 34.7 billion negative impact from CMO compensation tied to HER3-DXd timing changes and inventory write-downs, while saying there is no anticipated impairment in current inventory.

Analysts focused on why ENHERTU forecasts were trimmed in some regions, and management pointed to Europe shipment timing tied to ERP changes and Japan timing effects from prior-year price revision timing, while saying the long-term growth path is unchanged. A major theme was the decision to add the NMR biomarker to DATROWAY lung studies; management said this was intended to improve the probability of success and that FDA was consulted before the protocol amendment. Questions also pressed on DS-9606’s discontinuation, with management saying the modified PBD platform’s utility was confirmed but the asset was dropped for portfolio reasons, and on inventory write-downs and CMO compensation, where management said no further compensation obligation has been identified and no inventory impairment is currently expected.