Gilead Sciences, Inc 10-Q for FY2024 Q1

Gilead Sciences, Inc. (GILD)

10-Q 2024-05-08 For: 2024-03-31

Added on April 11, 2026

About this 10-Q

Gilead Sciences, Inc filed this 10-Q on May 8, 2024, covering the quarter ended March 31, 2024 (FY2024 Q1).

Headline figures

Quarter ended March 31, 2024, as reported in this filing, compared with the same period a year earlier where the filing states it.

Revenue: $6.69B; up 5.3% from $6.35B a year earlier
Net loss: $4.17B; compared with net income of $1.01B a year earlier
Diluted EPS: -$3.34; compared with $0.80 a year earlier

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Delaware			94-3047598
(State or Other Jurisdiction of Incorporation or Organization)			(IRS Employer Identification No.)


(in millions, except per share amounts)	March 31, 2024		December 31, 2023
Assets
Current assets:
Cash and cash equivalents	$	4,718	$	6,085
Short-term marketable debt securities	—		1,179
Accounts receivable, net	4,669		4,660
Inventories	1,853		1,787
Prepaid and other current assets	2,800		2,374
Total current assets	14,041		16,085
Property, plant and equipment, net	5,321		5,317
Long-term marketable debt securities	—		1,163
Intangible assets, net	23,428		26,454
Goodwill	8,314		8,314
Other long-term assets	5,188		4,792
Total assets	$	56,292	$	62,125
Liabilities and Stockholders’ Equity
Current liabilities:
Accounts payable	$	622	$	550
Accrued rebates	4,263		3,802
Other current liabilities	4,464		5,130
Current portion of long-term debt and other obligations, net	3,667		1,798
Total current liabilities	13,015		11,280
Long-term debt, net	21,527		23,189
Long-term income taxes payable	1,967		2,039
Deferred tax liability	933		1,588
Other long-term obligations	1,395		1,280
Commitments and contingencies (Note 10)
Stockholders’ equity:
Preferred stock, par value $0.001 per share; 5 shares authorized; none outstanding	—		—
Common stock, par value $0.001 per share; 5,600 shares authorized; 1,246 shares issued and outstanding	1		1
Additional paid-in capital	6,813		6,500
Accumulated other comprehensive income	69		28
Retained earnings	10,656		16,304
Total Gilead stockholders’ equity	17,539		22,833
Noncontrolling interest	(84)		(84)
Total stockholders’ equity	17,455		22,749
Total liabilities and stockholders’ equity	$	56,292	$	62,125


	Three Months Ended
	March 31,
(in millions, except per share amounts)	2024		2023
Revenues:
Product sales	$	6,647	$	6,306
Royalty, contract and other revenues	39		46
Total revenues	6,686		6,352
Costs and expenses:
Cost of goods sold	1,552		1,401
Research and development expenses	1,520		1,447
Acquired in-process research and development expenses	4,131		481
In-process research and development impairment	2,430		—
Selling, general and administrative expenses	1,375		1,319
Total costs and expenses	11,008		4,647
Operating (loss) income	(4,322)		1,705
Interest expense	254		230
Other (income) expense, net	(91)		174
(Loss) income before income taxes	(4,486)		1,300
Income tax (benefit) expense	(315)		316
Net (loss) income	(4,170)		985
Net loss attributable to noncontrolling interest	—		(26)
Net (loss) income attributable to Gilead	$	(4,170)	$	1,010
Basic (loss) earnings per share attributable to Gilead	$	(3.34)	$	0.81
Shares used in basic (loss) earnings per share attributable to Gilead calculation	1,247		1,248
Diluted (loss) earnings per share attributable to Gilead	$	(3.34)	$	0.80
Shares used in diluted (loss) earnings per share attributable to Gilead calculation	1,247		1,261


	Three Months Ended
	March 31,
(in millions)	2024		2023
Net (loss) income	$	(4,170)	$	985
Other comprehensive income (loss), net:
Net foreign currency translation loss	(17)		(5)
Available-for-sale debt securities:
Net unrealized gain, net of tax impact of $0 and $0, respectively	—		8
Reclassifications to net (loss) income, net of tax impact of $0 and $0, respectively	5		1
Net change	5		9
Cash flow hedges:
Net unrealized gain (loss), net of tax impact of $8 and $(1), respectively	53		(6)
Reclassifications to net (loss) income, net of tax impact of $0 and $3, respectively	—		(21)
Net change	53		(26)
Other comprehensive income (loss), net	41		(22)
Comprehensive (loss) income, net	(4,130)		962
Comprehensive loss attributable to noncontrolling interest, net	—		(26)
Comprehensive (loss) income attributable to Gilead, net	$	(4,130)	$	988


	Three Months Ended March 31, 2024
(in millions, except per share amounts)	Gilead Stockholders’ Equity									Noncontrolling Interest		Total Stockholders’ Equity
	Common Stock			Additional Paid-In Capital		Accumulated Other Comprehensive Income		Retained Earnings
	Shares	Amount
Balance as of December 31, 2023	1,246	$	1	$	6,500	$	28	$	16,304	$	(84)	$	22,749
Net loss	—	—		—		—		(4,170)		—		(4,170)
Other comprehensive income, net	—	—		—		41		—		—		41
Issuances under employee stock purchase plan	1	—		80		—		—		—		80
Issuances under equity incentive plans	6	—		65		—		—		—		65
Stock-based compensation	—	—		188		—		—		—		188
Repurchases of common stock under repurchase programs ($76.88 average price per share)	(5)	—		(20)		—		(380)		—		(400)
Repurchases of common stock for employee tax withholding under equity incentive plans and other	(2)	—		—		—		(116)		—		(116)
Dividends declared ($0.77 per share)	—	—		—		—		(980)		—		(980)
Balance as of March 31, 2024	1,246	$	1	$	6,813	$	69	$	10,656	$	(84)	$	17,455


☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934


	Three Months Ended March 31, 2023
(in millions, except per share amounts)	Gilead Stockholders’ Equity									Noncontrolling Interest		Total Stockholders’ Equity
	Common Stock			Additional Paid-In Capital		Accumulated Other Comprehensive Income (Loss)		Retained Earnings
	Shares	Amount
Balance as of December 31, 2022	1,247	$	1	$	5,550	$	2	$	15,687	$	(31)	$	21,209
Net income (loss)	—	—		—		—		1,010		(26)		985
Other comprehensive loss, net	—	—		—		(22)		—		—		(22)
Issuances under employee stock purchase plan	1	—		67		—		—		—		67
Issuances under equity incentive plans	6	—		27		—		—		—		27
Stock-based compensation	—	—		165		—		—		—		165
Repurchases of common stock under repurchase programs ($82.29 average price per share)	(5)	—		(17)		—		(383)		—		(400)
Repurchases of common stock for employee tax withholding under equity incentive plans	(2)	—		—		—		(135)		—		(135)
Dividends declared ($0.75 per share)	—	—		—		—		(957)		—		(957)
Balance as of March 31, 2023	1,248	$	1	$	5,793	$	(20)	$	15,223	$	(58)	$	20,939


	December 31, 2023
(in millions)		Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value
U.S. treasury securities		$	427	$	—	$	(1)	$	426
U.S. government agencies securities		127		—		—		127
Non-U.S. government securities		10		—		—		10
Certificates of deposit		45		—		—		45
Corporate debt securities		1,455		4		(8)		1,451
Residential mortgage and asset-backed securities		366		1		—		367
Total		$	2,430	$	5	$	(10)	$	2,426


	December 31, 2023
	Less Than 12 Months				12 Months or Longer				Total
(in millions)	Gross Unrealized Losses		Estimated Fair Value		Gross Unrealized Losses		Estimated Fair Value		Gross Unrealized Losses		Estimated Fair Value
U.S. treasury securities	$	—	$	161	$	(1)	$	48	$	(1)	$	209
U.S. government agencies securities	—		106		—		2		—		108
Non-U.S. government securities	—		5		—		5		—		10
Corporate debt securities	(1)		333		(7)		546		(8)		878
Residential mortgage and asset-backed securities	—		123		—		24		—		147
Total	$	(2)	$	727	$	(8)	$	624	$	(10)	$	1,351


(in millions)	Foreign Currency Translation		Unrealized Gains and Losses on Available-for-Sale Debt Securities, Net of Tax		Unrealized Gains and Losses on Cash Flow Hedges, Net of Tax		Total
Balance as of December 31, 2023	$	62	$	(5)	$	(29)	$	28
Net unrealized (loss) gain	(17)		—		53		36
Reclassifications to net income	—		5		—		5
Net current period other comprehensive (loss) income	(17)		5		53		41
Balance as of March 31, 2024	$	45	$	—	$	24	$	69


(in millions)				Carrying Amount
Type of Borrowing	Issue Date	Maturity Date	Interest Rate	March 31, 2024		December 31, 2023
Senior Unsecured	March 2014	April 2024	3.70%	$	1,750	$	1,750
Senior Unsecured	November 2014	February 2025	3.50%	1,749		1,749
Senior Unsecured	September 2015	March 2026	3.65%	2,745		2,744
Senior Unsecured	September 2016	March 2027	2.95%	1,248		1,248
Senior Unsecured	September 2020	October 2027	1.20%	748		747
Senior Unsecured	September 2020	October 2030	1.65%	995		994
Senior Unsecured	September 2023	October 2033	5.25%	992		992
Senior Unsecured	September 2015	September 2035	4.60%	993		993
Senior Unsecured	September 2016	September 2036	4.00%	743		743
Senior Unsecured	September 2020	October 2040	2.60%	988		988
Senior Unsecured	December 2011	December 2041	5.65%	996		996
Senior Unsecured	March 2014	April 2044	4.80%	1,737		1,737
Senior Unsecured	November 2014	February 2045	4.50%	1,734		1,734
Senior Unsecured	September 2015	March 2046	4.75%	2,223		2,222
Senior Unsecured	September 2016	March 2047	4.15%	1,729		1,729
Senior Unsecured	September 2020	October 2050	2.80%	1,478		1,478
Senior Unsecured	September 2023	October 2053	5.55%	988		988
Total senior unsecured notes				23,838		23,834
Liability related to future royalties				1,157		1,153
Liability related to assumed financing arrangement				199		—
Total debt, net				25,193		24,987
Less: Current portion of long-term debt and other obligations, net				3,667		1,798
Total Long-term debt, net				$	21,527	$	23,189


	Three Months Ended
	March 31,
(in millions, except percentages)	2024			2023
(Loss) income before income taxes	$	(4,486)		$	1,300
Income tax (benefit) expense	$	(315)		$	316
Effective tax rate	7.0		%	24.3		%


	Three Months Ended
	March 31,
(in millions, except percentages and per share amounts)	2024		2023		Change
Total revenues	$	6,686	$	6,352	5	%
Net (loss) income attributable to Gilead	$	(4,170)	$	1,010	NM
Diluted (loss) earnings per share attributable to Gilead	$	(3.34)	$	0.80	NM


	Total Number of Shares Purchased (in thousands)	Average Price Paid per Share		Total Number of Shares Purchased as Part of Publicly Announced Programs (in thousands)	Approximate Dollar Value of Shares that May Yet Be Purchased Under the Programs (in millions)
January 1 - January 31, 2024	2,072	$	82.17	1,815	$	3,724
February 1 - February 29, 2024	1,916	$	74.00	1,860	$	3,587
March 1 - March 31, 2024	2,752	$	74.24	1,529	$	3,474
Total	6,740	$	76.61	5,204


	Three Months Ended March 31, 2024								Three Months Ended March 31, 2023
(in millions)	U.S.		Europe		Rest of World		Total		U.S.		Europe		Rest of World		Total
Product sales:
HIV
Biktarvy	$	2,315	$	365	$	265	$	2,946	$	2,161	$	304	$	212	$	2,677
Descovy	371		26		29		426		395		25		29		449
Genvoya	332		49		21		403		417		55		29		501
Odefsey	223		76		11		310		230		76		11		317
Symtuza - Revenue share(1)	104		33		3		141		98		36		4		138
Other HIV(2)	60		45		12		117		62		32		13		108
Total HIV	3,405		596		342		4,342		3,364		528		298		4,190

Liver Disease
Sofosbuvir/Velpatasvir(3)	248		79		78		405		204		90		90		385
Vemlidy	95		11		119		225		87		9		103		199
Other Liver Disease(4)	42		47		19		107		27		41		23		91
Total Liver Disease	385		137		215		737		318		140		217		675

Veklury	315		70		169		555		252		111		209		573

Oncology
Cell Therapy
Tecartus	55		36		8		100		59		27		3		89
Yescarta	170		158		52		380		210		121		28		359
Total Cell Therapy	225		195		60		480		269		148		31		448

Trodelvy	206		68		36		309		162		54		6		222
Total Oncology	431		262		96		789		431		202		37		670

Other
AmBisome	14		70		60		144		6		60		49		116
Other(5)	59		9		12		80		62		12		9		83
Total Other	73		79		71		224		69		72		58		199
Total product sales	4,609		1,144		894		6,647		4,434		1,053		819		6,306
Royalty, contract and other revenues	23		15		1		39		18		26		2		46
Total revenues	$	4,633	$	1,159	$	894	$	6,686	$	4,452	$	1,079	$	821	$	6,352


	Three Months Ended
	March 31,
(in millions)	2024		2023
Beginning balance	$	228	$	275
Changes in valuation assumptions(1)	—		(3)
Effect of foreign exchange remeasurement(2)	(6)		5
Ending balance(3)	$	222	$	277


	March 31, 2024								December 31, 2023
(in millions)	Gross Carrying Amount		Accumulated Amortization		Foreign Currency Translation Adjustment		Net Carrying Amount		Gross Carrying Amount		Accumulated Amortization		Foreign Currency Translation Adjustment		Net Carrying Amount
Finite-lived assets:
Intangible asset – sofosbuvir	$	10,720	$	(7,224)	$	—	$	3,496	$	10,720	$	(7,050)	$	—	$	3,670
Intangible asset – axicabtagene ciloleucel	7,110		(2,416)		—		4,694		7,110		(2,314)		—		4,796
Intangible asset – Trodelvy	11,730		(2,272)		—		9,458		11,730		(2,002)		—		9,728
Intangible asset – Hepcludex	845		(265)		—		580		845		(243)		—		602
Other	1,414		(855)		1		560		1,414		(827)		1		588
Total finite-lived assets	31,819		(13,032)		1		18,788		31,819		(12,436)		1		19,384
Indefinite-lived assets – IPR&D(1)	4,640		—		—		4,640		7,070		—		—		7,070
Total intangible assets	$	36,459	$	(13,032)	$	1	$	23,428	$	38,889	$	(12,436)	$	1	$	26,454


(in millions)	March 31, 2024		December 31, 2023
Raw materials	$	1,237	$	1,246
Work in process	778		847
Finished goods	1,348		1,272
Total	$	3,363	$	3,366
Reported as:
Inventories	$	1,853	$	1,787
Other long-term assets(1)	1,510		1,578
Total	$	3,363	$	3,366


Exhibit Footnote	Exhibit Number	Description of Document
(1)	2.1	Agreement and Plan of Merger, dated February 11, 2024, among CymaBay Therapeutics, Inc., Registrant and Pacific Merger Sub, Inc.

(2)	3.1	Restated Certificate of Incorporation of Registrant

(3)	3.2	Amended and Restated Bylaws of Registrant

	4.1	Reference is made to Exhibit 3.1 and Exhibit 3.2

(4)	4.2	Indenture related to Senior Notes, dated as of March 30, 2011, between Registrant and Wells Fargo, National Association, as Trustee

(4)	4.3	First Supplemental Indenture related to Senior Notes, dated as of March 30, 2011, between Registrant and Wells Fargo, National Association, as Trustee (including form of Senior Notes)

(5)	4.4	Second Supplemental Indenture related to Senior Notes, dated as of December 13, 2011, between Registrant and Wells Fargo, National Association, as Trustee (including Form of 2041 Note)

(6)	4.5	Third Supplemental Indenture related to Senior Notes, dated as of March 7, 2014, between Registrant and Wells Fargo, National Association, as Trustee (including Form of 2024 Note and Form of 2044 Note)

(7)	4.6	Fourth Supplemental Indenture related to Senior Notes, dated as of November 17, 2014, between Registrant and Wells Fargo, National Association, as Trustee (including Form of 2025 Note and Form of 2045 Note)

(8)	4.7	Fifth Supplemental Indenture, dated as of September 14, 2015, between Registrant and Wells Fargo Bank, National Association, as Trustee (including Form of 2026 Note, Form of 2035 Note and Form of 2046 Note)

(9)	4.8	Sixth Supplemental Indenture, dated as of September 20, 2016, between Registrant and Wells Fargo Bank, National Association, as Trustee (including Form of 2027 Note, Form of 2036 Note and Form of 2047 Note)

10	4.9	Eighth Supplemental Indenture, dated as of September 30, 2020, between the Registrant and Wells Fargo Bank, National Association, as Trustee (including Form of 2027 Note, Form of 2030 Note, Form of 2040 Note, and Form of 2050 Note)

(11)	4.10	Ninth Supplemental Indenture, dated as of September 14, 2023, between the Registrant and Computershare Trust Company, National Association, as successor to Wells Fargo Bank, National Association, as Trustee (including Form of 2033 Note and Form of 2053 Note)

(12)	4.11	Description of Registrant’s Securities

(13)	10.1*	Gilead Sciences, Inc. 2004 Equity Incentive Plan, amended and restated May 10, 2017

(14)	10.2*	Amendment No. 1 to Gilead Sciences, Inc. 2004 Equity Incentive Plan, amended and restated May 10, 2017

(15)	10.3*	Gilead Sciences, Inc. 2022 Equity Incentive Plan

(16)	10.4*	Form of employee stock option agreement under 2004 Equity Incentive Plan (for grants made in 2011 through 2018)

(17)	10.5*	Form of global employee stock option agreement under 2004 Equity Incentive Plan (for grants made in 2019)

(18)	10.6*	Form of global employee stock option agreement under 2004 Equity Incentive Plan (4 year vest) (for grants made in 2019)

(19)	10.7*	Form of global employee stock option agreement under 2004 Equity Incentive Plan (4 year vest) (for grants made in 2020)

(20)	10.8*	Form of global employee stock option agreement under 2004 Equity Incentive Plan (4 year vest) (for grants made in 2021)

(21)	10.9*	Form of global employee stock option agreement under 2004 Equity Incentive Plan (4 year vest) (for certain grants made in 2022)

(22)	10.10*	Form of global employee stock option agreement under 20 22 Equity Incentive Plan (4 year vest) (for certain grants made in 2022)

(23)	10.11*	Form of global employee stock option agreement under 2022 Equity Incentive Plan (4 year vest) (for certain grants made in 2023)

	10.12,*	Form of global employee stock option agreement under 2022 Equity Incentive Plan (4 year vest) (for certain grants commencing in 2024)

(24)	10.13*	Form of non-employee director stock op t i o n a g r e e m e n t u n d e r 2 0 0 4 E q u i t y I n c e n t i v e P l a n (f o r g r a n t s m a d e i n 2 0 1 4 t h r o u g h 2 0 1 8 )

(17)	10.14*	Form of non-employee director stock option agreement under 2004 Equity Incentive Plan (for grants made in 2019)

(25)	10.15*	Form of non-employee director stock option agreement under 2004 Equity Incentive Plan (for grants made in 2020 and 2021)

(22)	10.16*	Form of non-employee director stock option agreement under 2022 Equity Incentive Plan (for grants made in 2022)

(26)	10.17*	Form of non-employee director stock option agreement under 2022 Equity Incentive Plan (for grants made in 2023)

(19)	10.18*	Form of performance share award agreement - TSR Goals (U.S.) under 2004 Equity Incentive Plan (for grants made in 2020)

(20)	10.19*	Form of performance share award agreement - TSR Goals (U.S.) under 2004 Equity Incentive Plan (for grants made in 2021)

(21)	10.20*	Form of performance share award agreement - TSR Goals (U.S.) under 2004 Equity Incentive Plan (for grants made in 2022)

(23)	10.21*	Form of performance share award agreement - TSR Goals (U.S.) under 2022 Equity Incentive Plan (for grants made in 2023)

	10.22,*	Form of performance share award agreement - TSR Goals (U.S.) under 2022 Equity Incentive Plan (for grants commencing in 2024)


		GILEAD SCIENCES, INC.
		(Registrant)

Date:	May 8, 2024	/s/ DANIEL P. O’DAY
		Daniel P. O’Day Chairman and Chief Executive Officer (Principal Executive Officer)

Date:	May 8, 2024	/s/ ANDREW D. DICKINSON
		Andrew D. Dickinson Chief Financial Officer (Principal Financial Officer)


Name of Optionee:
Grant Date:
Total Number of Option Shares:
Exercise Price:
Vesting Schedule:			Subject to Paragraphs 4 and 5, the Option will vest and become exercisable as follows: (i) 25% of the Option Shares on the first anniversary of the Grant Date and (ii) 6.25% of the Option Shares quarterly thereafter through the fourth anniversary of the Grant Date, in each case, subject to Optionee’s Continuous Service through each vesting date.
Expiration Date:


GILEAD SCIENCES, INC.
			/s/ Jyoti Mehra
By:			Jyoti Mehra
Title:			EVP, Human Resources


Participant:
Grant Date:
Target Number of Performance Shares:			The actual number of Shares that may become issuable pursuant to the Performance Shares subject to this Agreement will be determined in accordance with the performance-vesting and Continuous Service vesting provisions of attached Schedule I. For purposes of the applicable calculations under Schedule I, the target number of Performance Shares to be utilized is shares (the “Target Shares”).


Vesting Schedule:			Vesting Requirements. The Performance Shares will be subject to the performance-vesting and Continuous Service vesting requirements set forth in attached Schedule I and will vest on the Certification Date Change in Control Vesting. The Shares underlying the Performance Shares may also vest on an accelerated basis in accordance with the applicable provisions of Paragraph 4 of this Agreement should a Change in Control occur after the start but prior to the completion of the Performance Period applicable to the Performance Shares or the Certification Date.

Issuance Date:			The Shares which actually vest and become issuable pursuant to the Performance Shares will be issued in accordance with the provisions of this Agreement applicable to the particular circumstances under which such vesting occurs.


Percentile			% of Target
0			0%
10th			0%
20th			0%
30th			25%
40th			63%
50th			100%
60th			125%
70th			150%
80th			175%
81st			200%
90th			200%
100th			200%


Vesting Schedule:			Vesting Requirements. Each Tranche of Performance Shares will be subject to the performance-vesting and Continuous Service vesting requirements set forth for that particular Tranche in attached Schedule I and will vest on the Certification Date. Change in Control Vesting. The Shares underlying each Tranche of Performance Shares may also vest on an accelerated basis in accordance with the applicable provisions of Paragraph 4 of this Agreement should a Change in Control occur after the start but prior to the completion of the Performance Period applicable to that particular Tranche or the Certification Date.

Issuance Date:			The Shares which actually vest and become issuable pursuant to each Tranche of Performance Shares will be issued in accordance with the provisions of this Agreement applicable to the particular circumstances under which such vesting occurs.


Net Product Revenue Achievement (in millions)	% of Target	Performance Shares Earned Under Tranche
$24,801	90.0%	20%
$27,557	100.0%	100%
$28,246	102.5%	150%
$28,935	105.0%	200%


Participant:
Grant Date:
Number of Shares Subject to Award:			shares of Common Stock (the “Shares”)
Vesting Schedule:			Subject to Paragraphs 3 and 5, the Shares will vest in as follows: (i) 25% of the Shares on the first anniversary of the Grant Date and (ii) 6.25% of the Shares quarterly thereafter through the fourth anniversary of the Grant Date, in each case, subject to Participant’s Continuous Service through each vesting date.
Issuance Schedule			Shares that have become vested will be issued no later than the later of (i) the close of the calendar year in which the Shares vest pursuant to the Vesting Schedule or (ii) the 15th day of the third calendar month following the applicable vesting date, in each case subject to the Company’s collection of applicable Withholding Taxes pursuant to Paragraph 7.