revenue $24.1B, net income $5.24B. J&J Q1 sales jump 9.9% on oncology strength, but STELARA erosion deepens and tariffs hit MedTech

The company increased its share repurchase activity by approximately 26%, buying 16.8 million shares in Q1 2026 compared to 13.4 million shares in Q1 2025. The average price per share also increased from $159.01 to $239.26, reflecting both higher share prices and increased repurchase volume. All repurchases continue to support compensation programs rather than a formal buyback authorization.

Total sales growth accelerated from 2.4% in Q1 2025 to 9.9% in Q1 2026, with operational growth improving from 4.2% to 6.4%. Currency impact swung from a 1.8% headwind to a 3.5% tailwind. The company achieved $24.1 billion in sales versus $21.9 billion in the prior-year quarter, reflecting stronger underlying business momentum and favorable FX conditions.

STELARA biosimilar competition intensified, with the worldwide operational sales drag increasing from 4.7% in Q1 2025 to 5.4% in Q1 2026. Within Innovative Medicine, the impact worsened from 8.1% to 9.2%. STELARA sales fell from $1,625M to $656M year-over-year, a 59.7% decline, as biosimilar launches continued globally.

The Intra-Cellular Therapies acquisition (closed April 2, 2025) contributed CAPLYTA sales of $270M in Q1 2026, adding 1.1 percentage points to worldwide operational growth. This is the first full quarter reflecting CAPLYTA revenue, which was not present in the baseline period. The neuroscience franchise now includes CAPLYTA as a disclosed product line.

Oncology operational growth moderated from 20.4% in Q1 2025 to 17.8% in Q1 2026, but absolute sales increased from $5,678M to $6,973M (22.8% total growth including currency). DARZALEX grew 22.5% to $3,964M, CARVYKTI surged 62.1% to $597M, and TECVAYLI grew 33.5% to $202M. The current period highlights TECVAYLI + DARZALEX FASPRO approval and community-setting expansion as new growth drivers. IMBRUVICA declines persisted due to competitive pressures.

Immunology operational decline worsened from 10.9% in Q1 2025 to 11.8% in Q1 2026, with total sales falling from $3,707M to $3,380M. STELARA sales collapsed 59.7% to $656M due to biosimilar competition. TREMFYA grew 68.3% to $1,608M, driven by IBD launch momentum. SIMPONI/SIMPONI ARIA and REMICADE both declined in Q1 2026 (versus growth in Q1 2025), reflecting share loss and biosimilar pressures after lapping prior-year one-time benefits.

The company newly disclosed that biosimilar versions of SIMPONI are seeking regulatory approval, with potential launches in H1 2026 in Europe and H2 2026 in the U.S. This represents a new near-term revenue risk for the immunology franchise. SIMPONI/SIMPONI ARIA generated $647M in Q1 2026, down 1.7% year-over-year.

Neuroscience operational performance swung from a 7.0% decline in Q1 2025 to 29.3% growth in Q1 2026, with total sales rising from $1,647M to $2,175M. The turnaround was driven by the CAPLYTA acquisition ($270M in Q1 2026), SPRAVATO growth of 46.4% to $468M, and INVEGA franchise growth of 15.0% to $1,038M (reversing prior-year Part D headwinds). This represents a major inflection in the neuroscience portfolio.

The company newly disclosed that generic competition for OPSUMIT is expected in the U.S. in H2 2026, which will likely reduce future sales. OPSUMIT/OPSYNVI generated $606M in Q1 2026, up 16.1% year-over-year. This represents a new near-term revenue risk for the pulmonary hypertension franchise.

Cardiovascular operational growth decelerated from 17.7% in Q1 2025 to 10.5% in Q1 2026, but total sales increased from $2,103M to $2,377M (13.0% growth). Electrophysiology reversed from decline to 12.6% growth ($1,489M), driven by new products (VARIPULSE, TRUPULSE, NUVISION, CRYSTAL) despite Pulsed Field Ablation competitive pressures. Shockwave grew 18.5% to $305M. The deceleration reflects lapping of the Shockwave acquisition anniversary.

The current period identifies tariffs as a new driver of cost-of-goods pressure in the MedTech business, which was not mentioned in the baseline. This contributed to MedTech segment margin compression from 17.7% to 14.3%. The baseline period cited Shockwave inventory step-up and amortization as the primary MedTech cost driver, which is no longer highlighted.

MedTech segment margin fell from 17.7% in Q1 2025 to 14.3% in Q1 2026, a 340-basis-point decline. The current period attributes this to tariffs, lapping of prior-year divestiture gains, and Orthopaedics separation costs. Segment income before tax declined from $1,421M to $1,239M despite sales growth from $8,020M to $8,636M. This represents significant margin pressure in the MedTech business.

The company is now incurring costs related to the planned separation of its Orthopaedics business (announced October 2025), which contributed to MedTech margin compression. The baseline period had no such costs. The company disclosed $0.1 billion in Orthopaedics separation costs in Other (income) expense, net for Q1 2026.

Net debt increased from $13.5 billion at Q1 2025 to $32.9 billion at Q1 2026, driven by a $16.7 billion decline in cash/marketable securities (from $38.8B to $22.1B) and a $2.7 billion increase in debt (from $52.3B to $55.0B). The cash decline reflects the $14.6 billion Intra-Cellular acquisition (closed April 2, 2025) and ongoing capital allocation. This represents a material increase in leverage.

The remaining talc reserve balance declined from $4.2 billion at Q1 2025 to $3.4 billion at Q1 2026, reflecting $0.8 billion in payments. The opioid settlement balance declined from $1.5 billion to $1.1 billion, reflecting $0.4 billion in payments. The company also disclosed $1.8 billion in current-portion corporate bonds due, which was not mentioned in the baseline liquidity discussion.

The quarterly dividend increased from $1.30 per share (declared April 2025) to $1.34 per share (declared April 2026), a 3.1% increase. This reflects continued commitment to returning cash to shareholders despite higher net debt and ongoing litigation settlements.

The IRA litigation disclosure was updated to reflect that Janssen lost at the Third Circuit and sought U.S. Supreme Court review in December 2025. The baseline stated the appeal was filed to the Third Circuit in April 2024; the current period states the Third Circuit affirmed the district court's ruling in favor of the government. The language also shifted from "implementation of the program is still in progress" to "has recently begun implementing the program", indicating the program is now operational.

The company added disclosure about recently issued administrative guidance on the Pillar Two side-by-side system that will fully exclude U.S.-parented groups from certain provisions of the OECD Pillar Two Framework. This represents a favorable development that may reduce the company's exposure to the 15% global minimum tax. The baseline period contained only generic Pillar Two monitoring language.

The company disclosed a new Surgery franchise restructuring program initiated in fiscal 2025, with $55M in Q1 2026 charges and $0.3B in cumulative costs. Total program costs are estimated at $0.9B-$1.0B, with substantial completion expected by end of fiscal 2026. This represents a new restructuring initiative focused on exiting non-strategic product lines and optimizing sites. The baseline period did not contain this disclosure.