AI Takeaway
Vertex Pharmaceuticals delivered a strong Q1 FY2026 with revenue of $2.99B (+7.8% YoY), operating income surging 80.6% to $1.14B, and net income jumping 59.6% to $1.03B, reflecting significant margin expansion and robust cash generation.
Revenue
$2.99B
++7.82% YoY
EPS (Basic)
$4.06
++61.11% YoY
Operating Income
$1.14B
++80.62% YoY
Filed · Analysis updated · Source: SEC EDGAR 10-Q filing
Total net revenues reached $2.99B in Q1 FY2026, up 7.8% from $2.77B in Q1 FY2025, indicating continued strong demand for Vertex's cystic fibrosis (CF) franchise and potentially contributions from newer product approvals.
Source: Source: 10-Q Income Statement Data
Operating margin expanded approximately 15.4 percentage points YoY to 38.1% from 22.7%, driven by operating income growing 80.6% to $1.14B while revenue grew at a more modest 7.8%, suggesting significant operating leverage and/or one-time cost reductions in the prior year period.
Source: Source: 10-Q Income Statement & Key Ratios Data
SG&A expenses rose 24.5% YoY to $493.7M from $396.4M, outpacing revenue growth and suggesting increased commercial spending, potentially related to new product launches or expanded market access efforts.
Source: Source: 10-Q Income Statement Data
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Upgrade to unlockVertex's revenue remains heavily dependent on its CF drug portfolio. Any competitive entry, label changes, reimbursement challenges, or safety issues affecting CF medicines could materially impact revenues. The 7.8% revenue growth, while solid, may reflect maturing CF market penetration in some geographies.
Source: Source: 10-Q Income Statement Data
Unlock 4 more detailed risk analysis
Upgrade to unlockReported EPS of $4.47 versus the $4.40 analyst consensus — a +1.7% beat for Q1 FY2026.
| Metric | Current | Previous | YoY Change |
|---|---|---|---|
Revenue | $2.99B | $2.77B | +7.82% |
Cost of Revenue | $392.8M | $363M | +8.21% |
Operating Income | $1.14B | $630.1M | +80.62% |
Net Income | $1.03B | $646.3M | +59.59% |
EPS (Basic) | $4.06 | $2.52 | +61.11% |
EPS (Diluted) | $4.02 | $2.49 | +61.45% |
SG&A Expense | $493.7M | $396.4M | +24.55% |
| Metric | Current | Previous | YoY Change |
|---|---|---|---|
Total Assets | $26.48B | $22.88B | +15.75% |
Current Assets | $11.73B | $10.01B | +17.20% |
Total Liabilities | $7.12B | $6.38B | +11.56% |
Current Liabilities | $3.88B | $3.78B | +2.57% |
Stockholders' Equity | $19.36B | $16.5B | +17.37% |
Cash & Equivalents | $5.49B | $4.67B | +17.50% |
| Metric | Current | Previous | YoY Change |
|---|---|---|---|
Operating Cash Flow | $1.43B | $818.9M | +74.39% |
Investing Cash Flow | $-431.9M | $-55.8M | -674.01% |
Financing Cash Flow | $-538.8M | $-680.4M | +20.81% |
Share Buybacks | $336.9M | $426.1M | -20.93% |
D&A | $55.9M | $48.4M | +15.50% |
| Metric | Current | Previous | YoY Change |
|---|---|---|---|
Operating Margin | 38.1% | 22.7% | +15.36% |
Net Margin | 34.5% | — | — |
ROE | 5.3% | — | — |
ROA | 3.9% | — | — |
Current Ratio | $3.023 | — | — |
Debt to Equity | $0.368 | — | — |
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Vertex Pharmaceuticals delivered a strong Q1 FY2026, with revenue of $2.99B (+7.8% YoY), net income of $1.03B (+59.6% YoY), and diluted EPS of $4.02 (+61.4% YoY). Operating margin expanded sharply to 38.1% from 22.7% in the prior year quarter, reflecting significant profitability improvement.
Vertex's Q1 FY2026 revenue grew 7.8% YoY to $2.99B, primarily driven by continued strong performance of its cystic fibrosis drug portfolio. The company also saw operating cash flow surge 74.4% to $1.43B, indicating high-quality revenue conversion.
Vertex's balance sheet is very strong, with $5.49B in cash and equivalents, a current ratio of 3.02, and a low debt-to-equity ratio of 0.37. Total stockholders' equity grew 17.4% YoY to $19.36B, reflecting consistent profitability and capital accumulation.
Key risks for Vertex include heavy revenue concentration in its cystic fibrosis franchise, SG&A expenses growing 24.5% YoY (outpacing 7.8% revenue growth), and a sharp increase in investing cash outflows to -$431.9M suggesting large capital commitments whose returns are uncertain. Pipeline execution risk beyond CF also remains a critical long-term concern.
No — Vertex's share buybacks actually decreased 20.9% YoY to $336.9M in Q1 FY2026 from $426.1M in Q1 FY2025. Despite the reduction in buybacks, diluted EPS still grew 61.4% YoY to $4.02, driven primarily by strong net income growth.