Unexpected decline! Novo Nordisk expects sales to drop by 13% in 2026, US stocks fell over 10% | Earnings report insights
Novo Nordisk's Q4 sales fell 7.6% year-on-year, still stronger than analysts' expectations, with sales of the weight loss drug Wegovy also exceeding expectations; it is expected to see the first annual sales decline in nine years this year, with sales and operating profit expected to decline by 5% to 13% in 2026, while analysts expect declines of 1.4% and 3.1%, respectively. The company stated that the guidance reflects expectations for sales growth in international business and sales decline in the U.S. business; the global GLP-1 market is expected to continue to expand, allowing the company’s sales volume to increase, but at a lower actual selling price. Novo Nordisk's U.S. stock closed down 14.6%
Due to the forecast of a significant decline in sales in 2026, the stock price of Danish pharmaceutical giant Novo Nordisk, listed in the U.S., plummeted during trading. Facing the dual blows of fierce market competition and U.S. drug price reduction policies, the company is confronting its most severe performance challenges in nearly a decade.
Novo Nordisk expects that, excluding the impact of exchange rates, sales for the entire year of 2026 will decline by 5% to 13% compared to 2025, far exceeding the analyst expectation of about 1.4%. This guidance of a greater-than-expected decline triggered a strong market reaction. After the earnings report was released, trading of Novo Nordisk's American Depositary Receipts on the New York Stock Exchange was briefly halted, and after resuming, the stock fell more than 10% near midday trading, closing down 14.6%.
Novo Nordisk CEO Mike Doustdar stated that in 2026, the company will face pricing pressure in an increasingly competitive market. Although the global GLP-1 market is expected to continue expanding, the "most favored nation pricing" policy promoted by former U.S. President Trump, along with the expiration of patents for semaglutide in several international markets, will significantly impact revenue.
The latest guidance indicates that Novo Nordisk will record its first annual sales decline in nine years this year, the last time being in 2017 due to a price war in the U.S. insulin market. Currently, Novo Nordisk's star products Ozempic and Wegovy are facing strong competition from Eli Lilly's Zepbound and will also encounter competition from Ozempic generics in international markets.
2026 Guidance Far Below Expectations
Novo Nordisk's early release of its 2026 outlook shows that the company expects sales and operating profit, calculated at constant exchange rates, to decline by 5% to 13%. Analysts had previously expected sales to decline by only about 1.4% and operating profit to decline by 3.1%. This far greater-than-expected decline shocked the market.
Novo Nordisk introduced a new non-International Financial Reporting Standards (non-IFRS) metric, namely adjusted sales growth and adjusted operating profit growth, to exclude one-time impacts such as the reversal of a $4.2 billion sales rebate reserve related to the U.S. 340B drug pricing program. On a non-adjusted basis, the midpoint of the guidance for sales and operating profit growth in 2026 is -1% and 11%, respectively.
Novo Nordisk expects that adjusted sales growth in Danish kroner will be 3 percentage points lower than at fixed exchange rates, primarily due to the depreciation of the U.S. dollar against the Danish krone. Adjusted operating profit growth will be 5 percentage points lower.
Novo Nordisk pointed out that the 2026 performance guidance reflects expectations for sales growth in international business and sales decline in the U.S. business. Although the global GLP-1 market is expected to continue expanding, allowing Novo Nordisk to increase patient coverage and expand sales, this will be offset by lower actual prices, including the "most favored nation" agreements in the U.S. and the impact of patent expirations for semaglutide molecules in certain international markets
Multiple Pressures Eroding Revenue
Novo Nordisk faces challenges from multiple fronts. In the U.S. market, the company's GLP-1 injection product line is under dual pressure from changing prescription trends and intensified competition. The negative impact of the U.S. Medicaid program's reduction in coverage for obesity medications further exacerbates the pressure.
More critically, the so-called "most favored nation" agreement reached with the U.S. government will significantly lower actual prices. This agreement aims to allow more Americans to access GLP-1 medications at a lower cost. Additionally, the positive impact related to gross adjustments tied to net sales in the U.S. business in 2025 is not expected to recur.
In international markets, the continued penetration and market expansion of GLP-1 treatments will provide growth momentum, but the intensified competition and the expiration of the semaglutide compound patent in certain markets cannot be overlooked. Novo Nordisk plans to continue launching Wegovy in more markets by 2026 and introduce the 7.2mg dosage in multiple countries.
Novo Nordisk also plans to continue targeted investments in current and future growth opportunities in research and development and commercial areas, with part of the funding coming from cost savings from the company's transformation in 2025 and further optimization measures.
2025 Performance Slightly Exceeds Expectations
Novo Nordisk's full-year performance for 2025 shows a sales increase of 6% to DKK 309.06 billion, a 10% increase at constant exchange rates, slightly above analysts' expectations of DKK 307.62 billion. This growth is primarily driven by the obesity care business, which grew by 31% at constant exchange rates, while GLP-1 diabetes product sales increased by 6%.
Operating profit was DKK 127.66 billion, a decrease of 0.5% year-on-year, but a 6% increase at constant exchange rates. Net profit was DKK 102.43 billion, a year-on-year increase of 1.4%. Excluding approximately DKK 8 billion in company transformation costs, operating profit would have increased by 6%, with a 13% increase at constant exchange rates.
Fourth-quarter performance shows sales of DKK 79.14 billion, a year-on-year decrease of 7.6%, but higher than analysts' expectations of DKK 76.9 billion. Wegovy sales were DKK 21.86 billion, exceeding the expected DKK 21.07 billion. Ozempic's annual sales were DKK 127.09 billion, surpassing the expected DKK 124.87 billion In the United States, sales increased by 8% at constant exchange rates, while international business grew by 14%. The total sales for obesity and diabetes care amounted to DKK 289.46 billion, with sales in the rare disease sector growing by 9%.
Wegovy Oral Version Boosts Confidence
Despite facing severe challenges, Novo Nordisk still has some highlights. The U.S. Food and Drug Administration approved the first oral GLP-1 obesity treatment drug on December 22, 2024—25mg of semaglutide taken once daily, branded as Wegovy pill.
The product will be launched on January 5, 2026, and as of January 23, the total weekly prescription volume is approximately 50,000. The growth in prescriptions is primarily driven by the 1.5mg starting dose in the self-pay channel. According to Bloomberg Intelligence analyst Michael Shah, citing Symphony Health data, this performance seems to be better than the initial sales of Eli Lilly's Zepbound.
Novo Nordisk CEO Doustdar expressed that the company is very encouraged by the early acceptance of the Wegovy oral version in the U.S. market and remains confident in driving sales growth in the coming years. The company continues to focus on expanding the accessibility of Wegovy, particularly through NovoCare Pharmacy in the self-pay channel and partnerships with telemedicine institutions.
Novo Nordisk also looks forward to regulatory decisions on next-generation treatment products in 2026, including Mim8 in the hemophilia field and CagriSema in the obesity field, as well as the results of phase 3 clinical trials for etavopivat and ziltivekimab. In the fourth quarter, CagriSema successfully completed its phase 3 trial REIMAGINE 2 in the diabetes treatment field.
Shareholder Return Measures
In 2025, Novo Nordisk, listed in Copenhagen, Denmark, saw its stock price drop nearly 49%, making it the worst-performing year in the company's history. Since entering 2026, the stock price has fallen over 1% again. Novo Nordisk is trying to regain investor trust.
This financial report shows that the Novo Nordisk Board of Directors has decided to initiate a new stock buyback program of up to DKK 15 billion (approximately USD 2.4 billion). The board will also propose a final dividend of DKK 7.95 per share at the annual general meeting on March 26, 2026, bringing the expected total dividend for 2025 to DKK 11.70 per share.
The company provided innovative treatments for 46 million patients in 2025. CEO Doustdar acknowledged that 2025 was a challenging year for the company, but it achieved a 10% sales growth at constant exchange rates. He emphasized that despite facing pricing pressures and intensified competition in 2026, the company remains confident in driving sales growth in the coming years
