TLDR
- Novo Nordisk projects sales and operating profit to drop 5-13% in 2026, far worse than analyst expectations
- Shares plunged up to 14% after the guidance was released early, marking the first annual sales decline since 2017
- Company faces pricing pressure in the U.S., its largest market, plus patent losses for Wegovy and Ozempic in China, Brazil, and Canada
- Fourth quarter net sales reached $12.5 billion, beating estimates, while Ozempic sales grew 1% and Wegovy sales jumped 17%
- Novo recently launched oral Wegovy in the U.S. and faces tough competition from Eli Lilly’s weight loss drugs
Novo Nordisk dropped a bombshell on investors Tuesday. The company issued guidance showing sales and operating profit could fall between 5% and 13% in 2026.
The forecast came as a shock. Analysts had expected only modest declines.
Shares crashed up to 14% in afternoon trading after a brief halt. The news broke after Copenhagen’s market close, ahead of the scheduled Wednesday morning release.
This marks the first time Novo will see annual sales decline since 2017. Back then, a U.S. insulin price war dragged down results.
The Danish drugmaker faces multiple headwinds this time around. Pricing pressure in the U.S. market is squeezing margins. Patents for blockbuster drugs Wegovy and Ozempic are expiring in China, Brazil, and Canada.
CEO Mike Doustdar acknowledged the tough road ahead. “In 2026, Novo Nordisk will face pricing headwinds in an increasingly competitive market,” he said in a statement.
But there’s a silver lining. The company launched oral Wegovy in the U.S. in early January, and early uptake looks promising.
The guidance shows Novo expects sales to drop in the U.S., its biggest market. However, the company projects growth in markets outside America. Global GLP-1 market expansion should continue, allowing Novo to reach more patients and increase volumes.
The Competition Heats Up
Novo has been losing ground to Eli Lilly over the past 18 months. Lilly’s rival weight-loss drug tirzepatide, sold as Mounjaro and Zepbound, showed more weight loss in studies than Novo’s medicines.
Lilly also grabbed a larger share of the U.S. market, particularly in the direct-to-patient channel. This is mostly self-pay or cash-pay customers.
Morningstar analyst Karen Andersen pointed out what investors want to see. “Investors want to see they are making the most of this lead, particularly in the direct to patient channel, closing some of the large gap that widened between them and Lilly in 2025,” she said.
Eli Lilly plans to launch its own weight loss pill in the first half of 2026. This puts pressure on Novo to capitalize on its first-mover advantage with oral Wegovy.
Both companies struck deals with the Trump administration in November. They agreed to cut prices for their best-selling drugs for Medicare and Medicaid patients. The drugs will also be offered at discounts through TrumpRx.gov, which was expected to launch in January.
These deals should increase patient volumes. But they’ll ultimately hurt total sales numbers.
Recent Performance Shows Mixed Results
In 2025, Novo’s sales increased 10% and operating profit rose 6%. That matched the company’s latest guidance, which had been lowered multiple times throughout the year.
The stock took a beating last year. Shares fell 46.5% in 2025, driven by guidance cuts, leadership changes, and intense competition.
Fourth quarter results came in slightly better than expected. Net sales hit 79.1 billion Danish kroner, about $12.5 billion. Analysts had predicted 77.8 billion kroner.
Operating profit for the quarter reached 31.7 billion kroner, down 14% from the previous year. This matched analyst estimates.
Ozempic remained the best-selling medicine. It brought in 31.8 billion kroner in the quarter, up 1% year-over-year at constant exchange rates.
Wegovy sales totaled 21.9 billion kroner, jumping 17% from the same period last year. The company plans to roll out Wegovy in more markets during 2026 and introduce a higher 7.2 mg dose in several countries.
Barclays analyst James Gordon suggested the guidance could serve as a clearing event. Given the heavy investor concern about 2026, some might see cuts as an opportunity to buy into the oral Wegovy launch and potential U.S. volume growth for injectable Wegovy.
Wall Street analysts maintain a Moderate Buy rating on the stock based on four Buys, three Holds, and one Sell. The average price target of $57 per share suggests 11.8% upside potential from current levels.
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