What happened?
Shares of global pharmaceutical company Eli Lilly (NYSE: LLY) jumped 8.1% in the morning session after the company reported third-quarter 2026 non-GAAP earnings growth and raised the midpoint of its full-year revenue guidance by $5.5 billion.
According to a company press release, Eli Lilly reported that non-GAAP earnings per share rose 7% to $7.48, even after absorbing acquired research and development charges. Revenue exceeded expectations, with sales up 38.6% year on year to $24.4 billion.The company lifted its full-year 2026 revenue outlook to between $91.0 billion and $92.0 billion.
The financial update followed positive topline data from the company's head-to-head Phase 3 TRANSCEND-T2D-2 trial. In that study, the company reported that retatrutide delivered greater A1C reductions and more than double the average weight loss of Ozempic's 2 mg dose over 80 weeks in adults with type 2 diabetes. Significant guidance increases alongside competitive clinical data in metabolic treatments fueled investor confidence in the company's long-term commercial momentum.
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What is the market telling us
Eli Lilly’s shares are not very volatile and have only had 5 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful, although it might not be something that would fundamentally change its perception of the business.
The biggest move we wrote about over the last year was 9 months ago when the stock gained 10% on the news that the company reported fourth-quarter 2025 results that beat Wall Street expectations and issued an upbeat forecast for 2026, driven by high demand for its weight-loss drugs.
The pharmaceutical company's revenue grew 42.6% year-over-year to $19.29 billion, surpassing analysts' estimates. Adjusted earnings per share came in at $7.54, which was also well above expectations.
This strong performance was fueled by soaring sales of its popular weight-loss and diabetes drugs, Zepbound and Mounjaro. Looking ahead, Eli Lilly provided a positive outlook for 2026, forecasting revenue of $81.5 billion at the midpoint and adjusted earnings per share of $34.25 at the midpoint. Both projections were higher than what analysts had predicted.
Eli Lilly is up 26.8% since the beginning of the year, and at $1,369 per share, it has set a new 52-week high. Investors who bought $1,000 worth of Eli Lilly’s shares 5 years ago would now be looking at an investment worth $5,376.
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