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Q3 net sales grew +7% (cc 1 , +8% USD) and core operating income 1 grew +7% (cc, +6% USD) Sales growth was driven by continued strong execution on priority brands including Kisqali (+68% cc), Kesimpta (+44% cc), Pluvicto (+45% cc) and Scemblix (+95% cc) Core operating income margin1 was stable (cc) at 39.3% despite increasing generic impact Q3 operating income grew +27% (cc, +24% USD); net income rose +25% (cc, +23% USD) Q3 core EPS 1 grew +10% (cc, +9% USD) to USD 2.25 Q3 free cash flow 1 was USD 6.2 billion (+4% USD) driven by higher net cash flows from operating activities Strong nine months performance with net sales up +11% (cc, +11% USD) and core operating income up +18% (cc, +16% USD) Q3 selected innovation milestones: Rhapsido FDA approval as the only oral, targeted BTK inhibitor for CSU Ianalumab positive replicate Phase III readouts in Sjogren's disease Pluvicto positive Phase III PSMAddition data at ESMO Scemblix positive CHMP opinion for all lines of CML treatment Cosentyx positive Phase III readout in PMR Fabhalta positive Phase III eGFR readout in IgA nephropathy Full-year 2025 guidance 2 reaffirmed Sales expected to grow high single-digit Core operating income expected to grow low-teens 1. Constant currencies (cc), core results and free cash flow are non-IFRS measures. An explanation of non-IFRS measures can be found on page 42 of the Condensed Interim Financial Report. Unless otherwise noted, all growth rates in this Release refer to same period in prior year. 2. Please see detailed guidance assumptions on page 7. Basel, October 28, 2025 – Commenting on Q3 2025 results, Vas Narasimhan, CEO of Novartis, said:“Novartis delivered solid financial performance in Q3, more than offsetting the impact of increasing generic erosion in the US. Our key growth drivers performed well, including Kisqali, Kesimpta, Pluvicto and Scemblix. Importantly, we achieved FDA approval for Rhapsido in CSU and positive Phase III readouts for ianalumab in Sjogren's disease – two assets with pipeline-in-a-pill potential that could underpin our growth through 2030 and beyond. In addition, we completed several deals in the quarter to further strengthen our pipeline in core therapeutic areas. We remain well on track to achieve our guidance for 2025 and over the mid-term." Novartis is a“pure-play” innovative medicines company. We have a clear focus on four core therapeutic areas (cardiovascular-renal-metabolic, immunology, neuroscience and oncology), with multiple significant in-market and pipeline assets in each of these areas, that address high disease burden and have substantial growth potential. In addition to two established technology platforms (chemistry and biotherapeutics), three emerging platforms (gene & cell therapy, radioligand therapy and xRNA) are being prioritized for continued investment into new R&D capabilities and manufacturing scale. Geographically, we are focused on growing in our priority geographies – the US, China, Germany and Japan. Our priorities Financials Third quarter Net sales were USD 13.9 billion (+8%, +7% cc), with volume contributing 16 percentage points to growth. Generic competition had a negative impact of 7 percentage points, driven by Promacta, Tasigna and Entresto generics in the US. Pricing had a negative impact of 2 percentage points, driven by revenue deduction adjustments mainly in the US. Currency had a positive impact of 1 percentage point. Operating income was USD 4.5 billion (+24%, +27% cc), mainly driven by higher net sales and lower impairments, partly offset by higher R&D investments. Net income was USD 3.9 billion (+23%, +25% cc), mainly driven by higher operating income. EPS was USD 2.04 (+29%, +31% cc), benefiting from the lower weighted average number of shares outstanding. Core operating income was USD 5.5 billion (+6%, +7% cc), mainly driven by higher net sales, partly offset by higher R&D investments. Core operating income margin was 39.3% of net sales (-0.8 percentage points, stable in cc). Core net income was USD 4.3 billion (+5%, +6% cc), mainly due to higher core operating income, partly offset by other core financial income and expense. Core EPS was USD 2.25 (+9%, +10% cc), benefiting from the lower weighted average number of shares outstanding. Free cash flow amounted to USD 6.2 billion (+4% USD), compared with USD 6.0 billion in the prior-year quarter, driven by higher net cash flows from operating activities. Nine months Net sales were USD 41.2 billion (+11%, +11% cc), with volume contributing 14 percentage points to growth. Generic competition had a negative impact of 3 percentage points, while pricing and currency had no impact. Operating income was USD 14.0 billion (+27%, +31% cc), mainly driven by higher net sales and lower impairments, partly offset by higher investments behind priority brands and launches. Net income was USD 11.6 billion (+27%, +29% cc), mainly driven by higher operating income. EPS was USD 5.94 (+32%, +35% cc), benefiting from the lower weighted average number of shares outstanding. Core operating income was USD 17.0 billion (+16%, +18% cc), mainly driven by higher net sales, partly offset by higher investments behind priority brands and launches. Core operating income margin was 41.2% of net sales, increasing 1.8 percentage points (2.5 percentage points cc). Core net income was USD 13.5 billion (+14%, +17% cc), mainly due to higher core operating income. Core EPS was USD 6.94 (+19%, +21% cc), benefiting from the lower weighted average number of shares outstanding. Free cash flow amounted to USD 15.9 billion (+26% USD), compared with USD 12.6 billion in the prior-year period, driven by higher net cash flows from operating activities. Q3 priority brands Underpinning our financial results in the quarter is a continued focus on key growth drivers (ranked in order of contribution to Q3 growth) including: Net sales of the top 20 brands in the third quarter and nine months *Sales growth impacted by a one-time revenue deduction adjustment in the US R&D update - key developments from the third quarter New approvals Regulatory updates Results from ongoing trials and other highlights Capital structure and net debt Retaining a good balance between investment in the business, a strong capital structure, and attractive shareholder returns remains a priority. During the first nine months of 2025, Novartis repurchased a total of 66.4 million shares for USD 7.5 billion on the SIX Swiss Exchange second trading line. These repurchases included 49.1 million shares (USD 5.4 billion) under the USD 15 billion share buyback (announced in July 2023 and completed in July 2025) and 6.6 million shares (USD 0.8 billion) under the new up-to USD 10 billion share buyback announced in July 2025. In addition, 10.7 million shares (USD 1.3 billion) were repurchased to mitigate anticipated full-year dilution related to the equity-based compensation plans of associates. Further, 1.6 million shares (equity value of USD 0.2 billion) were repurchased from associates. In the same period, 11.7 million shares (equity value of USD 0.9 billion) were delivered to associates related to equity-based compensation plans. Consequently, the total number of shares outstanding decreased by 56.3 million versus December 31, 2024. These treasury share transactions resulted in an equity decrease of USD 6.8 billion and a net cash outflow of USD 7.7 billion. Net debt increased to USD 20.4 billion at September 30, 2025, compared to USD 16.1 billion at December 31, 2024. The increase was mainly due to the free cash flow of USD 15.9 billion being more than offset by the USD 7.8 billion annual dividend payment, cash outflows for treasury share transactions of USD 7.7 billion and net cash outflow for M&A, intangible assets transactions and other acquisitions of USD 3.7 billion. As of Q3 2025, the long-term credit rating for the company is Aa3 with Moody's Ratings and AA- with S&P Global Ratings. 2025 outlook Foreign exchange impact If late-October exchange rates prevail for the remainder of 2025, the foreign exchange impact for the year would be neutral to positive 1 percentage point on net sales and negative 2 percentage points on core operating income. The estimated impact of exchange rates on our results is provided monthly on our website. Key figures 1 1. Constant currencies (cc), core results and free cash flow are non-IFRS measures. An explanation of non-IFRS measures can be found on page 42 of the Condensed Interim Financial Report. Unless otherwise noted, all growth rates in this Release refer to same period in prior year. Detailed financial results accompanying this press release are included in the Condensed Interim Financial Report at the link below: Disclaimer This press release contains forward-looking statements within the meaning of the United States Private Securities Litigation Reform Act of 1995, that can generally be identified by words such as“anticipate,”“can,”“will,”“continue,”“ongoing,”“growth,”“launch,”“expect,”“expand,”“deliver,”“accelerate,”“guidance,”“outlook,”“priority,”“potential,”“momentum,”“commitment,” or similar expressions, or by express or implied discussions regarding potential new products, potential new indications for existing products, potential product launches, or regarding potential future revenues from any such products; or regarding results of ongoing clinical trials; or regarding potential future, pending or announced transactions; regarding potential future sales or earnings; or by discussions of strategy, plans, expectations or intentions, including discussions regarding our continued investment into new R&D capabilities and manufacturing; or regarding our capital structure. Such forward-looking statements are based on the current beliefs and expectations of management regarding future events and are subject to significant known and unknown risks and uncertainties. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those set forth in the forward-looking statements. You should not place undue reliance on these statements. There can be no guarantee that the investigational or approved products described in this press release will be submitted or approved for sale or for any additional indications or labeling in any market, or at any particular time. Nor can there be any guarantee that such products will be commercially successful in the future. Neither can there be any guarantee that the expected benefits or synergies from the transactions described in this press release will be achieved in the expected timeframe, or at all. In particular, our expectations could be affected by, among other things: uncertainties concerning global healthcare cost containment, including ongoing government, payer and general public pricing and reimbursement pressures and requirements for increased pricing transparency; uncertainties regarding the success of key products, commercial priorities and strategy; uncertainties in the research and development of new products, including clinical trial results and additional analysis of existing clinical data; our ability to obtain or maintain proprietary intellectual property protection, including the ultimate extent of the impact on Novartis of the loss of patent protection and exclusivity on key products; uncertainties regarding our ability to realize the strategic benefits, operational efficiencies or opportunities expected from our external business opportunities; uncertainties in the development or adoption of potentially transformational digital technologies, including artificial intelligence, and business models; uncertainties surrounding the implementation of our new IT projects and systems; uncertainties regarding potential significant breaches of information security or disruptions of our information technology systems; uncertainties regarding actual or potential legal proceedings, including regulatory actions or delays or government regulation related to the products and pipeline products described in this press release; safety, quality, data integrity, or manufacturing issues; our performance on and ability to comply with environmental, social and governance measures and requirements; major macroeconomic and geo- and socio-political developments, including the impact of any potential tariffs on our products or the impact of war in certain parts of the world; uncertainties regarding future global exchange rates; uncertainties regarding future demand for our products; and other risks and factors referred to in Novartis AG's most recently filed Form 20-F and in subsequent reports filed with, or furnished to, the US Securities and Exchange Commission. Novartis is providing the information in this press release as of this date and does not undertake any obligation to update any forward-looking statements as a result of new information, future events or otherwise. All product names appearing in italics are trademarks owned by or licensed to Novartis. About Novartis Novartis is an innovative medicines company. Every day, we work to reimagine medicine to improve and extend people's lives so that patients, healthcare professionals and societies are empowered in the face of serious disease. Our medicines reach nearly 300 million people worldwide.
