Pfizer revenue down 42% from last year after decreased demand for Covid vaccines

The pharmaceutical giant explained that the lower than anticipated earnings were due to decreased demand for its Covid-19 vaccines and treatment for the virus, known as Paxlovid.

According to Pfizer, revenue for FY2023, Q3 came in at $13.2 billion, just shy of the expected $13.34 billion.

The company recorded a whopping $5.6 billion in "non-cash inventory write-offs and other charges," of which $4.7 billion was due to unused Paxlovid kits. The remaining $900 million was attributed to Covid-19 vaccines that were manufactured but not used by their best before dates.

Fewer Americans have sought a fresh dose of the vaccine, and less of those who already contracted Covid-19 have turned to Paxlovid for treatment. This is in large part due to the prevalence of previous vaccinations and infections, which have led to milder cases for many.

Weakening demand for its Covid-related products also led Pfizer to reduce its full-year adjusted earnings from $67-70 billion to $58-$61 billion, and announce a $3.5 billion cost-cutting plan.

Nonetheless, CEO Dr. Albert Bourla remained optimistic about the company's future in areas not related to Covid-19.

"We are encouraged by the strong performance of Pfizer's non-COVID products in the third quarter of 2023," he said, "including significant contributions from new launches and robust year-over-year growth for several key in-line brands." He added that the company had "achieved several recent milestones that speak to the underlying strength and breadth of [its] scientific pipeline."

"With a significant uncertainty removed by our recently announced amended Paxlovid supply agreement with the US government, our expectation of additional clarification on global vaccination and treatment rates by the end of the year, and the breakthroughs continuing to emerge from our pipeline," he added, "we look forward to concluding 2023 with positive momentum that showcases Pfizer’s long-term growth potential."

While Pfizer did manage to outperform its Q2 earnings in the third quarter by half a billion dollars, 2023's figures pale in comparison to those recorded by the company last year. At the time, demand for Covid-19 vaccines and treatments were still relatively high, and as a result, Pfizer brought in $22.6 billion.