Merck KGaA

Reported Q2 2026 net sales increased to EUR 5.434 billion from EUR 5.255 billion in Q2 2025, with organic sales growth of 4.1% and a 1.1% currency headwind plus 0.4% portfolio contribution. EBITDA pre increased to EUR 1.6 billion from EUR 1.46 billion, and the EBITDA pre margin expanded to 29.4% from 27.8%, up 1.6 percentage points year over year. EPS pre rose 6.9% to EUR 2.16, despite higher interest costs tied to financing the SpringWorks acquisition. Operating cash flow was EUR 605 million, up 6.7% from EUR 567 million, and net financial debt stood at EUR 9.2 billion at June 30, mainly due to dividend payment. Full-year 2026 guidance was raised: organic group net sales growth is now expected at 1% to 3% versus 0% to 3% previously, with reported net sales of around EUR 21 billion to EUR 21.8 billion. FX is now expected to be minus 2% to 0% versus minus 3% to minus 1% previously. EBITDA pre guidance was increased to EUR 5.9 billion to EUR 6.3 billion from EUR 5.7 billion to EUR 6.1 billion, and EPS pre guidance increased to EUR 7.90 to EUR 8.60 from EUR 7.50 to EUR 8.20. By segment, Life Science organic sales growth guidance moved to 5% to 7%; Healthcare organic sales guidance improved to minus 4% to minus 2%; and Electronics organic sales guidance rose to 6% to 9%.

Kai Beckmann framed the quarter as proof that Merck’s portfolio is gaining momentum and that the strategic direction announced in May is already producing visible milestones. He highlighted the Bio-Techne agreement, the new metrology and inspection site in France, pipeline progress, and the fact that Life Science and Electronics continue to drive growth while Healthcare remains disciplined. His tone was confident but measured, repeatedly emphasizing disciplined execution, investment in innovation, and the expectation that 2027 should be broadly in line with prior CMD projections on an organic basis.

Helene von Roeder emphasized the financial improvement in the quarter: sales rose to EUR 5.434 billion, EBITDA pre to EUR 1.6 billion, and EPS pre to EUR 2.16. She noted that operating cash flow increased to EUR 605 million even though profit after tax was pressured by reorganization provisions, higher R&D, and increased depreciation and amortization from SpringWorks, and she said underlying cash generation has visibly improved. She also flagged net financial debt of EUR 9.2 billion, partly due to the dividend, and said interest cost guidance was slightly reduced for the full year. On capital allocation, she pointed to upcoming transaction-related effects only after Bio-Techne closes and said the company expects fast deleveraging after that deal.

Analysts focused heavily on 2027 growth, especially whether Life Science stocking and MAVENCLAD erosion could pressure organic growth. Management said 2027 should be in line with prior CMD expectations on an organic basis, while Bio-Techne would add close to 5% to group sales growth and about 10% to Life Science sales if it closes as planned. On Pergoveris, management said the FDA filing was accepted but approval remains uncertain because the package is based largely on legacy ex-U.S. data; a best-case label would resemble the EU or Canadian label. Other questions centered on Process Solutions stocking, DS&S lumpiness, and Semi/memory capacity; management said no destocking is expected in 2026, any inventory unwind would likely be a 2027 issue, DS&S should be roughly flat in H2, and memory chip shortages may persist until at least the second half of 2027.