# GILEAD SCIENCES, INC. (GILD)

Informational only - not investment advice.

CIK: 0000882095
SIC: 2836 Biological Products, (No Diagnostic Substances)
SIC breadcrumb: [Manufacturing](/division/D/) > [Chemicals And Allied Products](/major-group/28/) > [SIC 2836 Biological Products, (No Diagnostic Substances)](/industry/2836/)
Latest 10-K filed: 2026-02-24
SEC page: https://www.sec.gov/edgar/browse/?CIK=882095
Filing source: https://www.sec.gov/Archives/edgar/data/882095/000088209526000006/gild-20251231.htm

## Selected Fundamentals
| Metric | Value | Unit | FY | Filed |
| --- | ---: | --- | ---: | --- |
| Revenue | 29443000000 | USD | 2025 | 2026-02-24 |
| Net income | 8510000000 | USD | 2025 | 2026-02-24 |
| Assets | 59023000000 | USD | 2025 | 2026-02-24 |

## Financials

Annual standardized facts from SEC companyfacts as of latest extracted filing date 2026-02-24. Source: https://data.sec.gov/api/xbrl/companyfacts/CIK0000882095.json. Derived margins are computed from the extracted annual SEC facts.

| Metric | 2016 | 2017 | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | 2025 |
| --- | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: |
| Revenue | 30,390,000,000 | 26,107,000,000 | 22,127,000,000 | 22,449,000,000 | 24,689,000,000 | 27,305,000,000 | 27,281,000,000 | 27,116,000,000 | 28,754,000,000 | 29,443,000,000 |
| Net income | 13,501,000,000 | 4,628,000,000 | 5,455,000,000 | 5,386,000,000 | 123,000,000 | 6,225,000,000 | 4,592,000,000 | 5,665,000,000 | 480,000,000 | 8,510,000,000 |
| Operating income | 17,633,000,000 | 14,124,000,000 | 8,200,000,000 | 4,287,000,000 | 4,071,000,000 | 9,918,000,000 | 7,330,000,000 | 7,605,000,000 | 1,662,000,000 | 10,022,000,000 |
| Diluted EPS | 9.94 | 3.51 | 4.17 | 4.22 | 0.10 | 4.93 | 3.64 | 4.50 | 0.38 | 6.78 |
| Assets | 56,977,000,000 | 70,283,000,000 | 63,675,000,000 | 61,627,000,000 | 68,407,000,000 | 67,952,000,000 | 63,171,000,000 | 62,125,000,000 | 58,995,000,000 | 59,023,000,000 |
| Stockholders' equity | 18,887,000,000 | 20,442,000,000 | 21,387,000,000 | 22,525,000,000 | 18,202,000,000 | 21,069,000,000 | 21,240,000,000 | 22,833,000,000 | 19,330,000,000 | 22,703,000,000 |
| Net margin | 44.43% | 17.73% | 24.65% | 23.99% | 0.50% | 22.80% | 16.83% | 20.89% | 1.67% | 28.90% |
| Operating margin | 58.02% | 54.10% | 37.06% | 19.10% | 16.49% | 36.32% | 26.87% | 28.05% | 5.78% | 34.04% |

## Macro Cross-References
- [CPIAUCSL](/indicator/CPIAUCSL/): Consumer Price Index for All Urban Consumers: All Items in U.S. City Average
- [UNRATE](/indicator/UNRATE/): Unemployment Rate
- [FEDFUNDS](/indicator/FEDFUNDS/): Federal Funds Effective Rate
- [CES0500000003](/indicator/CES0500000003/): Average Hourly Earnings of All Employees, Total Private
- [DFEDTARU](/indicator/DFEDTARU/): Federal Funds Target Range - Upper Limit
- [DFEDTARL](/indicator/DFEDTARL/): Federal Funds Target Range - Lower Limit
- [DGS3MO](/indicator/DGS3MO/): Market Yield on U.S. Treasury Securities at 3-Month Constant Maturity
- [DGS2](/indicator/DGS2/): Market Yield on U.S. Treasury Securities at 2-Year Constant Maturity
- [DGS10](/indicator/DGS10/): Market Yield on U.S. Treasury Securities at 10-Year Constant Maturity
- [DGS30](/indicator/DGS30/): Market Yield on U.S. Treasury Securities at 30-Year Constant Maturity
- [T10Y2Y](/indicator/T10Y2Y/): 10-Year Treasury Constant Maturity Minus 2-Year Treasury Constant Maturity
- [CPILFESL](/indicator/CPILFESL/): Consumer Price Index for All Urban Consumers: All Items Less Food and Energy
- [CPIUFDSL](/indicator/CPIUFDSL/): Consumer Price Index for All Urban Consumers: Food
- [CPIENGSL](/indicator/CPIENGSL/): Consumer Price Index for All Urban Consumers: Energy
- [CUSR0000SAH1](/indicator/CUSR0000SAH1/): Consumer Price Index for All Urban Consumers: Shelter
- [PCEPI](/indicator/PCEPI/): Personal Consumption Expenditures: Chain-type Price Index
- [PCEPILFE](/indicator/PCEPILFE/): Personal Consumption Expenditures Excluding Food and Energy: Chain-type Price Index
- [PPIACO](/indicator/PPIACO/): Producer Price Index by Commodity: All Commodities
- [T10YIE](/indicator/T10YIE/): 10-Year Breakeven Inflation Rate
- [U6RATE](/indicator/U6RATE/): Total Unemployed, Plus All Marginally Attached Workers Plus Total Employed Part Time for Economic Reasons
- [PAYEMS](/indicator/PAYEMS/): All Employees, Total Nonfarm
- [CIVPART](/indicator/CIVPART/): Labor Force Participation Rate
- [EMRATIO](/indicator/EMRATIO/): Employment-Population Ratio
- [UNEMPLOY](/indicator/UNEMPLOY/): Unemployed
- [CE16OV](/indicator/CE16OV/): Employment Level
- [ICSA](/indicator/ICSA/): Initial Claims
- [JTSJOL](/indicator/JTSJOL/): Job Openings: Total Nonfarm
- [JTSQUR](/indicator/JTSQUR/): Quits: Total Nonfarm
- [GDPC1](/indicator/GDPC1/): Real Gross Domestic Product
- [A191RL1Q225SBEA](/indicator/A191RL1Q225SBEA/): Real Gross Domestic Product: Percent Change from Preceding Period
- [INDPRO](/indicator/INDPRO/): Industrial Production: Total Index
- [TCU](/indicator/TCU/): Capacity Utilization: Total Index
- [HOUST](/indicator/HOUST/): New Privately-Owned Housing Units Started: Total Units
- [PERMIT](/indicator/PERMIT/): New Privately-Owned Housing Units Authorized in Permit-Issuing Places: Total Units
- [RSAFS](/indicator/RSAFS/): Advance Retail Sales: Retail Trade
- [PCE](/indicator/PCE/): Personal Consumption Expenditures
- [DSPIC96](/indicator/DSPIC96/): Real Disposable Personal Income
- [PSAVERT](/indicator/PSAVERT/): Personal Saving Rate
- [M2SL](/indicator/M2SL/): M2
- [BOPGSTB](/indicator/BOPGSTB/): U.S. International Trade in Goods and Services: Balance

## Latest 10-K MD&A

Extracted between Item 7 and the next Item 7A/8 heading after HTML sanitization.
Confidence: high

ITEM 7.     MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion and analysis is intended to provide material information around events and uncertainties known to management that are relevant to an assessment of the financial condition and results of operations of Gilead and should therefore be read in conjunction with our audited Consolidated Financial Statements and the related notes thereto and other disclosures included as part of this Annual Report on Form 10-K (including the disclosures under Part I, Item 1A. Risk Factors). Additional information related to the comparison of our results of operations and liquidity and capital resources between the years 2024 and 2023 is included in Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations of our 2024 Form 10-K filed with U.S. Securities and Exchange Commission.

Management Overview

Gilead Sciences, Inc. (including its consolidated subsidiaries, referred to as “Gilead,” the “company,” “we,” “our” or “us”) is a biopharmaceutical company that has pursued and achieved breakthroughs in medicine for more than three decades, with the goal of creating a healthier world for all people. We are committed to advancing innovative medicines to prevent and treat life-threatening diseases, including HIV, viral hepatitis, COVID-19 and cancer. We operate in more than 35 countries worldwide, with headquarters in Foster City, California.

Our strategic ambitions are to (i) bring 10+ transformative therapies to patients by 2030 (tracking since 2020); (ii) be a biotech employer and partner of choice; and (iii) deliver shareholder value in a sustainable and responsible manner. Our strategic priorities, as refreshed in late 2025, to deliver on these ambitions include: (i) maximize impact of long-acting HIV therapies; (ii) accelerate our pipeline build in oncology and inflammation; (iii) adopt and scale artificial intelligence to transform how we work; (iv) prioritize investments for highest impact; and (v) strengthen collaboration to accelerate innovation.

Year in Review

During 2025, we delivered growth in our HIV product sales, introduced Yeztugo, the first and only twice-yearly HIV pre-exposure prophylaxis (“PrEP”) option available in the U.S., and expanded Livdelzi’s market share in the treatment of primary biliary cholangitis (“PBC”). As evidenced by various late-stage clinical trial updates in HIV and oncology, we continued to invest in our business and research and development (“R&D”) pipeline through advancement of our portfolio and broadening of available therapies, including through acquisitions and collaborations. Meanwhile, we maintained our financial position by lowering operating expenses, repaying senior notes coming due and providing shareholder returns through dividends and share repurchases. The following represents a summary of notable business updates and events since the filing of our Annual Report on Form 10-K for the year ended December 31, 2024, including certain items from our press releases, which readers are encouraged to review in full as available on our website at www.gilead.com. The content on the referenced website does not constitute a part of and is not incorporated by reference into this Annual Report on Form 10-K.

Virology

•Announced positive topline Phase 3 results from the ARTISTRY-1 and ARTISTRY-2 trial, evaluating our investigational daily oral single-tablet regimen of bictegravir 75mg and lenacapavir 50mg (“BIC/LEN”) for virologically suppressed adults with HIV. BIC/LEN met its primary endpoint, demonstrating non-inferiority to baseline multi-tablet antiviral regimens (ARTISTRY-1) and Biktarvy (ARTISTRY-2).

•Announced settlement agreements to resolve Biktarvy patent litigation with generic manufacturers Lupin Ltd., Cipla Ltd. and Laurus Labs Ltd. Under the agreements, the earliest date the three generic manufacturers can market a generic version of full dose Biktarvy in the U.S. is April 1, 2036, subject to standard acceleration provisions. This is more than two years later than our previous loss of exclusivity projection for Biktarvy (December 2033).

•Received a strong recommendation for the use of twice-yearly injectable Yeztugo (lenacapavir) for HIV PrEP in the new U.S. Centers for Disease Control and Prevention guidelines.

•Announced a partnership with the U.S. State Department and the U.S. President’s Emergency Plan for AIDS Relief (“PEPFAR”) to deliver lenacapavir for HIV PrEP for up to two million people over three years in countries supported by both PEPFAR and the Global Fund.

•Received European Commission (“EC”) marketing authorization for Yeytuo (lenacapavir) for PrEP to reduce the risk of sexually acquired HIV-1 in adults and adolescents with increased HIV-1 acquisition risk.

•Received U.S. Food and Drug Administration (“FDA”) approval for Yeztugo (lenacapavir) for PrEP to reduce the risk of sexually acquired HIV in adults and adolescents weighing at least 35kg.

36

•Announced that FDA had placed a clinical hold on the HIV treatment trials of GS-1720 and/or GS-4182, including the WONDERS-1 and WONDERS-2 trials. These drug candidates are investigational and not approved anywhere globally.

Oncology

•Announced that we entered into a definitive agreement to acquire all of the outstanding common stock of Arcellx, Inc. (“Arcellx”), providing us with full control of its leading pipeline candidate, anitocabtagene autoleucel, an investigational BCMA-directed CAR-T cell therapy for patients with relapsed and/or refractory multiple myeloma. This transaction is anticipated to close during the second quarter of 2026, subject to the satisfaction or waiver of customary closing conditions.

•Announced the discontinuation of the Phase 3 STAR-221 study, in partnership with Arcus Biosciences, Inc. (“Arcus”), evaluating the anti-TIGIT antibody domvanalimab (“dom”) plus zimberelimab (“zim”) and chemotherapy in first-line HER2- advanced gastric and esophageal cancers. The decision was based on the recommendation of the Independent Data Monitoring Committee, following review of data from a pre-specified interim analysis. Additionally, Gilead and Arcus will discontinue the Phase 2 EDGE-Gastric study evaluating dom and zim regimens in upper gastrointestinal cancers. Dom and zim are investigational products and are not approved anywhere globally.

•Announced that our Phase 3 ASCENT-07 study of Trodelvy evaluating sacituzumab govitecan-hziy (“SG”) as a first-line treatment post-endocrine therapy in hormone receptor-positive, human epidermal growth factor receptor 2-negative (“HR+/HER2-”) metastatic breast cancer patients did not meet the primary endpoint of progression-free survival. Overall survival is a key secondary endpoint and was not mature at the time of the primary analysis; however, an early trend was observed favoring patients treated with Trodelvy compared to chemotherapy.

•Presented Phase 3 ASCENT-03 data for Trodelvy in 1L metastatic triple-negative breast cancer (“mTNBC”) patients who are not candidates for PD-1/PD-L1 checkpoint inhibitors at the 2025 European Society for Medical Oncology Congress. Trodelvy is not approved in this setting.

•Entered into a collaboration with Shenzhen Pregene Biopharma Co., Ltd. (“Pregene”) to develop next-generation in vivo therapies.

•Announced the acquisition of Interius BioTherapeutics, Inc. (“Interius”), a privately held biotechnology company developing in vivo chimeric antigen receptor therapeutics, for approximately $350 million.

•Presented results from the Phase 3 ASCENT-04 trial evaluating Trodelvy plus Keytruda in 1L PD-L1+ mTNBC at the American Society of Clinical Oncology meeting. Trodelvy is not approved in this setting.

•Entered into an exclusive option and license agreement with Kymera Therapeutics, Inc. to develop novel oral molecular glue CDK2 degraders with broad oncology treatment potential.

Inflammation

•Received conditional marketing authorization from the EC for seladelpar for the treatment of PBC in combination with ursodeoxycholic acid (“UDCA”) in adults who have an inadequate response to UDCA alone, or as monotherapy in those unable to tolerate UDCA.

•Entered into a strategic partnership with LEO Pharma A/S (“LEO Pharma”) to develop and commercialize their pre-clinical oral signal transducer and activator of transcription 6 programs for the potential treatment of inflammatory diseases.

Corporate

•Announced an agreement with the U.S. government to lower the cost of medicines for Americans, reinforcing a commitment to U.S.-based innovation, affordability and global health leadership.

•Announced ground-breaking on a new Pharmaceutical Development and Manufacturing Technical Development Center in Foster City, California as part of a planned $32 billion investment in the U.S. through 2030.

The following table summarizes our key financial results for the year and period-over-period changes:

Year Ended December 31,

(in millions, except percentages and per share amounts)

2025

2024

Change

Total revenues

$

29,443 

$

28,754 

2 

%

Net income attributable to Gilead

$

8,510 

$

480 

NM

Diluted earnings per share attributable to Gilead

$

6.78 

$

0.38 

NM

_______________________________

NM - Not Meaningful

37

Total revenues increased 2% to $29.4 billion in 2025, compared to 2024, primarily due to:

•Higher product sales primarily driven by HIV and Liver Disease products, partially offset by lower sales of Veklury; and

•Higher royalty, contract and other revenues.

Net income attributable to Gilead was $8.5 billion and diluted earnings per share attributable to Gilead was $6.78 in 2025, compared to net income attributable to Gilead of $480 million and $0.38 diluted earnings per share attributable to Gilead in 2024. The increase was primarily due to:

•A $3.8 billion acquired in-process research and development (“IPR&D”) expense related to the acquisition of CymaBay Therapeutics, Inc. (“CymaBay”) in 2024, which did not repeat in 2025;

•Lower pre-tax IPR&D partial impairment charges, with $590 million in 2025 related to assets acquired from MYR GmbH (“MYR”) compared to $4.2 billion in 2024 related to assets acquired from Immunomedics, Inc.;

•Higher net unrealized gains on equity securities;

•Higher revenues; and

•Lower selling, general and administrative expenses; partially offset by

•Higher income tax expense.

Please refer to “Results of Operations” below for further information on 2025 results.

Outlook

As we look to 2026, we expect to see continued growth for our product sales overall, bolstered by increased demand in our HIV business. We anticipate that such growth will be partially offset by the impact of various policy-related developments in the U.S., as well as an expected decrease in our Veklury product sales due to lower rates of COVID-19-related hospitalizations and an expected decrease in our Cell Therapy product sales reflecting ongoing competitive headwinds.

Our R&D portfolio includes over 50 clinical-stage programs across our core therapeutic areas. We expect updates in 2026 on various clinical trials and certain regulatory filing submissions and decisions, including FDA decisions related to two first-line breast cancer therapies and an additional HIV treatment option. We plan to continue investing in our business and R&D pipeline both internally and externally through partnerships and select business development transactions. As part of our overall investment approach to fund the advancement of our pipeline and commercialization of our products, we will continue to focus on disciplined operating expense management.

38

Results of Operations

Revenues

The following table summarizes our Total revenues and period-over-period changes:

Year Ended December 31, 2025

Year Ended December 31, 2024

(in millions, except percentages)

U.S.

Europe

Rest of World

Total

U.S.

Europe

Rest of World

Total

Change

Product sales:

HIV

Biktarvy

$

11,467 

$

1,676 

$

1,190 

$

14,334 

$

10,855 

$

1,509 

$

1,060 

$

13,423 

7 

%

Descovy

2,559 

93 

105 

2,758 

1,902 

100 

110 

2,113 

31 

%

Genvoya

1,281 

148 

69 

1,498 

1,498 

180 

84 

1,762 

(15)

%

Odefsey

881 

246 

40 

1,167 

957 

290 

41 

1,288 

(9)

%

Symtuza - Revenue share(1)

363 

120 

12 

495 

450 

130 

12 

592 

(16)

%

Other HIV(2)

352 

109 

40 

500 

257 

129 

48 

434 

15 

%

Total HIV

16,904 

2,392 

1,456 

20,752 

15,918 

2,339 

1,355 

19,612 

6 

%

Liver Disease

Sofosbuvir/Velpatasvir(3)

636 

292 

344 

1,272 

922 

299 

374 

1,596 

(20)

%

Vemlidy

507 

49 

514 

1,070 

486 

44 

428 

959 

12 

%

Other Liver Disease(4)

476 

330 

69 

874 

192 

202 

73 

467 

87 

%

Total Liver Disease

1,619 

671 

927 

3,217 

1,601 

545 

876 

3,021 

6 

%

Veklury

470 

151 

290 

911 

892 

284 

623 

1,799 

(49)

%

Oncology

Cell Therapy

Tecartus

153 

158 

32 

344 

234 

138 

31 

403 

(15)

%

Yescarta

595 

598 

303 

1,495 

662 

666 

242 

1,570 

(5)

%

Total Cell Therapy

748 

755 

335 

1,839 

896 

804 

274 

1,973 

(7)

%

Trodelvy

877 

347 

173 

1,397 

902 

294 

119 

1,315 

6 

%

Total Oncology

1,626 

1,102 

508 

3,236 

1,798 

1,098 

393 

3,289 

(2)

%

Other

AmBisome

20 

267 

221 

509 

44 

276 

212 

533 

(5)

%

Other(5)

177 

32 

81 

290 

255 

34 

68 

356 

(19)

%

Total Other

197 

300 

302 

799 

299 

310 

280 

889 

(10)

%

Total product sales

20,816 

4,617 

3,483 

28,915 

20,508 

4,576 

3,526 

28,610 

1 

%

Royalty, contract and other revenues

60 

447 

20 

527 

82 

58 

4 

144 

NM

Total revenues

$

20,876 

$

5,064 

$

3,503 

$

29,443 

$

20,591 

$

4,634 

$

3,529 

$

28,754 

2 

%

_______________________________

NM - Not Meaningful

(1)    Represents our revenue from cobicistat (“C”), emtricitabine (“FTC”) and tenofovir alafenamide (“TAF”) in Symtuza (darunavir/C/FTC/TAF), a fixed dose combination product commercialized by Janssen Sciences Ireland Unlimited Company. See Note 7. Collaborations and Other Arrangements of the Notes to Consolidated Financial Statements included in Part II, Item 8 of this Annual Report on Form 10-K.

(2)    Includes Atripla, Complera/Eviplera, Emtriva, Stribild, Sunlenca, Truvada, Tybost and Yeztugo/Yeytuo.

(3)    Includes Epclusa and the authorized generic version of Epclusa sold by Gilead’s separate subsidiary, Asegua Therapeutics LLC (“Asegua”).

(4)    Includes ledipasvir/sofosbuvir (Harvoni and the authorized generic version of Harvoni sold by Asegua), Hepcludex, Hepsera, Livdelzi/Lyvdelzi, Sovaldi, Viread and Vosevi.

(5)    Includes Cayston, Jyseleca, Letairis and Zydelig.

HIV

HIV product sales increased 6% to $20.8 billion in 2025, compared to 2024, primarily due to higher demand for treatment and prevention, with average realized price being relatively flat despite the U.S. Medicare Part D program redesign impact. In particular:

•Biktarvy sales increased 7% primarily due to higher demand, including patients switching from Genvoya and other Gilead HIV products, partially offset by lower average realized price due to the U.S. Medicare Part D program redesign; and

•Descovy sales increased 31% primarily due to higher demand and average realized price.

39

Liver Disease

Liver Disease product sales increased 6% to $3.2 billion in 2025, compared to 2024, primarily due to higher demand for Livdelzi and products for chronic hepatitis B virus and chronic hepatitis D virus, partially offset by lower average realized price across all Liver Disease products, most notably for chronic hepatitis C virus, inclusive of the U.S. Medicare Part D program redesign impact.

Veklury

Veklury product sales decreased 49% to $911 million in 2025, compared to 2024, primarily due to lower COVID-19-related hospitalizations.

Oncology

Cell Therapy

Cell Therapy product sales decreased 7% to $1.8 billion in 2025, compared to 2024, primarily due to lower demand reflecting ongoing competitive headwinds.

Trodelvy

Trodelvy product sales increased 6% to $1.4 billion in 2025, compared to 2024, primarily due to higher demand in breast cancer treatment, partially offset by the indication withdrawal in bladder cancer treatment.

Gross-to-Net Deductions

Product sales are recorded net of estimated gross-to-net deductions, including rebates and chargebacks, patient co-pay assistance, prompt pay discounts, distributor fees, sales return provisions and other related deductions.

The following table summarizes our gross-to-net deductions and period-over-period changes:

Year Ended December 31,

(in millions, except percentages)

2025

2024

Change

Gross-to-net deductions(1)

$

19,953 

$

17,776 

12 

%

% of gross product sales

41 

%

38 

%

250 bps

_______________________________

(1)    Includes rebates and chargebacks of $17.5 billion and $15.5 billion for the years ended December 31, 2025 and 2024, respectively. For further information, see “Critical Accounting Estimates” section below.

Gross-to-net deductions as a percentage of gross product sales increased in 2025, compared to 2024, primarily due to U.S. Medicare Part D program redesign impact.

Foreign Currency Exchange Impact

We generally face exposure to movements in foreign currency exchange rates, primarily in the Euro. We use foreign currency exchange contracts to hedge a portion of our foreign currency exposures.

Approximately 26% and 27% of our product sales were denominated in foreign currencies during 2025 and 2024, respectively. Foreign currency exchange, net of hedges, had a favorable impact on our total product sales of $56 million in 2025, based on a comparison using foreign currency exchange rates from 2024.

Royalty, Contract and Other Revenues

Royalty, contract and other revenues increased to $527 million in 2025, compared to 2024, primarily due to recognition of $400 million of previously constrained revenues from the sale of certain intellectual property.

40

Costs and Expenses

The following table summarizes our costs and expenses and period-over-period changes:

Year Ended December 31,

(in millions, except percentages)

2025

2024

Change

Cost of goods sold

$

6,234 

$

6,251 

— 

%

Product gross margin

78.4 

%

78.2 

%

29 bps

Research and development expenses

$

5,799 

$

5,907 

(2)

%

Acquired in-process research and development expenses

$

1,024 

$

4,663 

(78)

%

In-process research and development impairments

$

590 

$

4,180 

(86)

%

Selling, general and administrative expenses

$

5,774 

$

6,091 

(5)

%

Product Gross Margin

Product gross margin was 78.4% in 2025 and remained relatively flat compared to 2024.

Research and Development Expenses

Research and development expenses consist primarily of personnel costs including salaries, benefits and stock-based compensation expense, infrastructure, materials and supplies and other support costs, research and clinical studies performed by contract research organizations and our collaboration partners and other outside services.

We manage these expenses by identifying the R&D activities we expect to be performed during a given period and then prioritizing efforts based on scientific data, probability of successful technical development and regulatory approval, market potential, available human and capital resources and other considerations. We regularly review our R&D activities based on unmet medical need and, as necessary, reallocate resources among our internal R&D portfolio and external opportunities that we believe will best support the long-term growth of our business. We do not track total R&D expenses by product candidate, therapeutic area or development phase.

The following table summarizes our Research and development expenses and period-over-period changes:

Year Ended December 31,

(in millions, except percentages)

2025

2024

Change

Personnel, infrastructure and other support costs

$

3,427 

$

3,555 

(4)

%

Clinical studies and other costs

2,372 

2,352 

1 

%

Research and development expenses

$

5,799 

$

5,907 

(2)

%

Research and development expenses decreased 2% to $5.8 billion in 2025, compared to 2024. Personnel, infrastructure and other support costs decreased primarily due to the impact of stock-based compensation expenses and other integration costs related to the acquisition of CymaBay in 2024, which did not repeat in 2025, as well as lower restructuring costs. Clinical studies and other costs remained relatively flat, with higher expenses driven by fair value adjustments to the MYR-related contingent consideration largely offset by lower study-related and clinical manufacturing expenses.

Acquired In-Process Research and Development Expenses

Acquired in-process research and development expenses are recorded when incurred and reflect costs of externally-developed IPR&D projects, acquired directly in a transaction other than a business combination, that do not have an alternative future use, including upfront and pre-commercialization milestone payments related to various collaborations and the costs of rights to IPR&D projects.

Acquired in-process research and development expenses were $1.0 billion in 2025, primarily related to the following transactions:

•$311 million Interius acquisition;

•$250 million LEO Pharma collaboration upfront payment; and

•$200 million Pregene collaboration upfront and milestone payments.

41

Acquired in-process research and development expenses were $4.7 billion in 2024, primarily related to the following transactions:

•$3.8 billion CymaBay acquisition;

•$320 million Janssen Pharmaceutica NV future royalty obligation extinguishment related to seladelpar;

•$100 million Arcus collaboration continuation fee;

•$68 million Arcellx collaboration milestones met; and

•$47 million Tmunity Therapeutics, Inc. acquisition milestones met.

See Note 6. Acquisitions and Note 7. Collaborations and Other Arrangements of the Notes to Consolidated Financial Statements included in Item 8 of this Annual Report on Form 10-K for additional information.

In-Process Research and Development Impairments

2025 Impairments

In the second quarter of 2025 and again in the fourth quarter of 2025, additional competitive clinical data became available indicating a potentially more competitive market for bulevirtide where it is not yet approved. Based on our evaluation of the data, and in connection with the preparation of the financial statements for the second quarter of 2025 and again for the year ended December 31, 2025, we performed impairment tests and determined that the revised estimated fair value of the bulevirtide IPR&D intangible asset was below its carrying value in both periods. As a result, we recognized partial impairment charges of $190 million and $400 million in In-process research and development impairments on our Consolidated Statements of Operations for the second and fourth quarters of 2025, respectively, for a total of $590 million for the year ended December 31, 2025.

To arrive at the revised estimated fair values as of June 30, 2025 and December 31, 2025, we used a probability-weighted income approach that discounts expected future cash flows to present value, which requires the use of Level 3 fair value measurements and inputs, including critical estimated inputs, such as: revenues and operating profits related to the planned utilization of bulevirtide outside of the European Union (“EU”), which includes inputs such as addressable patient population, projected market share, treatment duration, and the life of the potential commercialized product; the probability of technical and regulatory success; the time and resources needed to complete the development and approval of bulevirtide outside of the EU; an appropriate discount rate based on the estimated weighted-average cost of capital for companies with profiles similar to our profile; and risks related to the viability of and potential alternative treatments in any future target markets. Our revised discounted cash flows for the June 30, 2025 and December 31, 2025 fair value estimations primarily reflected the updated expectations for bulevirtide’s potential market share outside of the EU.

2024 Impairments

In January 2024, we received data from our Phase 3 EVOKE-01 study of Trodelvy evaluating SG indicating that the study did not meet its primary endpoint of overall survival in previously treated metastatic non-small cell lung cancer (“NSCLC”), thus triggering a review for potential impairment of the NSCLC IPR&D intangible asset. Based on our evaluation of the study results and all other data available at the time, and in connection with the preparation of the financial statements for the first quarter of 2024, we performed an interim impairment test and determined that the revised estimated fair value of the NSCLC IPR&D intangible asset was below its carrying value. As a result, we recognized a partial impairment charge of $2.4 billion in In-process research and development impairments on our Consolidated Statements of Operations during the first quarter of 2024.

In September 2024, based on discussions with regulators and external opinion leaders and the completed evaluation of the Phase 3 EVOKE-01 study data, we made a strategic decision to discontinue our clinical development program in metastatic NSCLC for Trodelvy in the second-line indication. This decision triggered a review for potential impairment of the NSCLC IPR&D intangible asset. Based on our evaluation, and in connection with the preparation of the financial statements for the third quarter of 2024, we performed an interim impairment test and determined that the revised estimated fair value of the NSCLC IPR&D intangible asset was below its carrying value. As a result, we recognized a partial impairment charge of $1.8 billion in In-process research and development impairments on our Consolidated Statements of Operations during the third quarter of 2024, bringing the full-year 2024 total to $4.2 billion.

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To arrive at the revised estimated fair value, we used a probability-weighted income approach that discounts expected future cash flows to present value, which requires the use of Level 3 fair value measurements and inputs, including critical estimated inputs, such as: revenues and operating profits related to the planned utilization of SG in NSCLC, which, include inputs such as addressable patient population, projected market share, treatment duration, and the life of the potential commercialized product; the probability of technical and regulatory success; the time and resources needed to complete the development and approval of SG in NSCLC; an appropriate discount rate based on the estimated weighted-average cost of capital for companies with profiles similar to our profile; and risks related to the viability of and potential alternative treatments in any future target markets. Our revised discounted cash flows for the March 31, 2024 fair value estimation primarily reflected the smaller addressable market that Trodelvy could serve among metastatic NSCLC patients and a delay in expected launch timing for second-line plus patients. Our revised discounted cash flows for the September 30, 2024 fair value estimation primarily reflected the removal of cash flows associated with second-line plus patients, and the remaining carrying value as of that date reflects Trodelvy’s opportunity as a combination therapy in first-line metastatic NSCLC patients supported by its ongoing Phase 3 clinical trial in this patient population.

If future events result in adverse changes in the key assumptions used in determining fair value, including the timing of product launches, information on the competitive landscape of treatments in this indication, changes to the probability of technical or regulatory success, failure to obtain anticipated regulatory approval or discount rate, among others, additional impairments may be recorded and could be material to our financial statements.

Selling, General and Administrative Expenses

Selling, general and administrative expenses are recorded when incurred and consist primarily of personnel costs, facilities and overhead costs, and selling, marketing and advertising expenses, as well as other general and administrative costs related to finance, human resources, legal and other administrative activities.

The following table summarizes our Selling, general and administrative expenses and period-over-period changes:

Year Ended December 31,

(in millions, except percentages)

2025

2024

Change

Selling and marketing expenses

$

3,522 

$

3,453 

2 

%

General and administrative expenses

2,252 

2,638 

(15)

%

Selling, general and administrative expenses

$

5,774 

$

6,091 

(5)

%

Selling, general and administrative expenses decreased 5% to $5.8 billion in 2025, compared to 2024. Selling and marketing expenses increased primarily due to higher HIV promotional expenses. General and administrative expenses decreased primarily due to lower expenses related to corporate initiatives and legal matters, as well as the impact of stock-based compensation expenses and other integration costs related to the acquisition of CymaBay in 2024, which did not repeat in 2025, partially offset by donations of equity securities made to the Gilead Foundation.

Interest Expense and Other (Income) Expense, Net

The following table summarizes our Interest expense and Other (income) expense, net and period-over-period changes:

Year Ended December 31,

(in millions, except percentages)

2025

2024

Change

Interest expense

$

1,024 

$

977 

5 

%

Other (income) expense, net

$

(798)

$

(6)

NM

(Gain) loss from equity securities, net

$

(451)

$

274 

NM

Interest income

$

(349)

$

(281)

24 

%

Other, net

$

1 

$

2 

(41)

%

_______________________________

NM - Not Meaningful

Interest expense increased 5% to $1.0 billion in 2025, compared to 2024, primarily due to higher debt balances and a higher weighted-average interest rate on the debt. See Note 10. Debt and Credit Facilities of the Notes to Consolidated Financial Statements included in Item 8 of this Annual Report on Form 10-K for additional information on our long-term debt and related interest rates.

Favorable movements in Other (income) expense, net in 2025, compared to 2024, primarily related to net unrealized gains from equity securities compared to net unrealized losses in 2024, as well as higher interest income.

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Income Taxes

The following table summarizes our Income tax (benefit) expense and period-over-period changes:

Year Ended December 31,

(in millions, except percentages)

2025

2024

Change

Income before income taxes

$

9,796 

$

690 

$

9,106 

Income tax expense

$

1,286 

$

211 

$

1,075 

Effective tax rate

13.1 

%

30.5 

%

NM

_______________________________

NM - Not Meaningful

Our effective tax rate decreased in 2025, compared to 2024, primarily due to:

•The non-deductible acquired IPR&D expense recorded in connection with our acquisition of CymaBay in 2024, which did not repeat in 2025;

•A settlement with a tax authority related to a prior year legal entity restructuring; and

•Favorable changes in the fair value of our equity securities that are non-taxable for income tax purposes; partially offset by

•A tax benefit associated with a legal entity restructuring in 2024; and

•A decrease in state deferred tax liabilities associated with the $4.2 billion NSCLC IPR&D intangible asset impairment charge in 2024.

The Organisation for Economic Co-operation and Development (“OECD”) has developed a framework to implement a global minimum corporate tax of 15% for companies with global revenues and profits above certain thresholds (referred to as “Pillar Two”), with certain aspects effective January 1, 2024 and other aspects effective January 1, 2025. Certain countries in which we operate have enacted Pillar Two legislation, and other countries are in the process of introducing legislation to implement Pillar Two. In January 2026, the OECD announced additional administrative guidance, including a “side-by-side” framework intended to coordinate the application of Pillar Two with existing minimum tax regimes in certain jurisdictions. We do not expect Pillar Two, including the side-by-side framework, to have a material impact on our results of operations, liquidity or capital resources.

Liquidity and Capital Resources

We regularly analyze our ability to generate and obtain adequate amounts of cash to meet our short-term and long-term requirements and plans. Our capital priorities include: (i) investing in our business and R&D pipeline, (ii) continuing select partnerships and business development transactions, (iii) growing our dividend over time, and (iv) repurchasing shares to offset dilution and opportunistically reduce share count. Based on our evaluation of our current position of liquidity, available capital resources and our material cash requirements, we believe that we can satisfy our capital needs for the next 12 months and the foreseeable future.

Liquidity

Cash and cash equivalents were $7.6 billion and marketable debt securities were $3.0 billion as of December 31, 2025. The table below summarizes our cash flow activities, followed by our analysis of changes and trends:

Year Ended December 31,

(in millions, except percentages)

2025

2024

Change

Net cash provided by (used in):

Operating activities

$

10,019 

$

10,828 

(7)

%

Investing activities

(4,793)

(3,449)

39 

%

Financing activities

(7,745)

(3,433)

NM

Effect of exchange rate changes on cash and cash equivalents

92 

(40)

NM

Net change in cash and cash equivalents

$

(2,428)

$

3,906 

NM

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Operating Activities

Net cash provided by operating activities is our primary source of funds, driven mainly by collections on product sales, partially offset by operating spend. Changes in working capital balances, generally associated with the timing of collections and payments, as well as unanticipated payments related to litigation, taxes or other matters, may create some variation in any given year. Net cash provided by operating activities decreased in 2025, compared to 2024, primarily due to higher inventory build-up and higher income tax payments, as well as unfavorable timing of accounts receivable collections. In 2025, we paid the final $1.3 billion federal income tax payment for transition tax on the mandatory deemed repatriation of foreign earnings related to the Tax Cuts and Jobs Act, compared to $1.2 billion paid in 2024.

Investing Activities

Net cash used in investing activities increased in 2025, compared to 2024. In 2025, we utilized cash primarily for purchases of marketable debt securities and payments related to the Interius acquisition and various collaborations. In 2024, we utilized cash primarily for the $3.9 billion CymaBay acquisition and purchases of equity securities, partially offset by cash received from the liquidation of marketable debt securities. Net cash used in investing activities may vary in any given year depending on the favorability of strategic opportunities for the business.

Financing Activities

The change in Net cash used in financing activities in 2025, compared to 2024, was primarily due to cash provided by a new debt offering in 2024, which did not repeat in 2025, as well as higher common stock repurchases. In 2025, we utilized cash of $4.0 billion for dividend payments, $1.9 billion for common stock repurchases and $1.8 billion for repayment of debt. In 2024, we utilized cash of $3.9 billion for dividend payments, $2.0 billion for repayment of debt and other obligations, and $1.2 billion for common stock repurchases, partially offset by $3.5 billion in net proceeds from the issuance of senior unsecured notes in November 2024. Net cash used in financing activities may vary in any given year depending primarily on the timing of debt repayments and proceeds from debt offerings and the amount of common stock repurchases.

On February 10, 2026, we announced that our Board of Directors declared a quarterly dividend of $0.82 per share of our common stock, with a payment date of March 30, 2026 to all stockholders of record as of the close of business on March 13, 2026. Future dividends are subject to declaration by our Board of Directors.

Capital Resources

As of December 31, 2025, our material cash requirements for the operations of our business consisted primarily of the current and long-term liabilities noted on our Consolidated Balance Sheets as well as other commitments, including the following notable items:

•payments of outstanding borrowings, including interest on long-term debt (see Note 10. Debt and Credit Facilities);

•income tax payments, including potential payments related to uncertain tax positions (see Note 15. Income Taxes);

•payments of operating lease obligations (see Note 11. Leases);

•payments related to certain unconditional inventory purchase obligations and capital expenditures. There were no changes to such commitments in the current year that would have a material impact on our ability to meet short- or long-term cash requirements;

•payments related to our acquisitions, including contingent consideration (see Notes 3. Fair Value Measurements and 6. Acquisitions); and

•milestone and other payments related to collaboration agreements (see Note 7. Collaborations and Other Arrangements). We are contractually obligated to make payments to our collaboration partners upon the achievement of various development, regulatory and commercial milestones as well as royalty payments. These payments are contingent upon the occurrence of various future events, substantially all of which have a high degree of uncertainty of occurring. If milestones for multiple products covered by these arrangements happen to be reached in the same reporting period, the aggregate cash requirement could be material. It is not possible to predict with reasonable certainty whether these milestones will be achieved or the timing for achievement. As such, these obligations are not recorded on our Consolidated Balance Sheets until the events triggering milestone payments occur.

Our anticipated sources of funds to satisfy the above material cash requirements for the short- and long-term include our current balances of cash and cash equivalents as well as future cash flows from operations. If needed, we also have the ability to utilize our $2.5 billion revolving credit facility (see Note 10. Debt and Credit Facilities) and access other external capital through future debt or equity offerings.

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While we are not aware of any trends at this time that are reasonably likely to materially impact our future cash requirements and sources of funds, such requirements and funds will depend on many factors, including but not limited to the following:

•the commercial performance of our current and future products;

•the progress and scope of our R&D efforts and those of our collaboration partners, including preclinical studies and clinical trials;

•the cost, timing and outcome of regulatory reviews;

•the expansion of our sales and marketing capabilities;

•the acquisition of additional manufacturing capabilities or office facilities on acceptable terms;

•the acquisition of other companies or new products on acceptable terms;

•the issuance of new debt or equity in the market on acceptable terms;

•the favorability of repaying certain long-term debt obligations prior to maturity dates;

•future dividends subject to declaration by our Board of Directors (see “Dividends” in Part II, Item 5 of this 10-K);

•the favorability of repurchasing shares (see “Issuer Purchases of Equity Securities” in Part II, Item 5 of this 10-K);

•the establishment of additional collaborative relationships with other companies on acceptable terms; and

•costs associated with the defense, settlement and adverse results of government investigations and litigation (see Note 12. Commitments and Contingencies).

Critical Accounting Estimates

See Note 1. Summary of Business and Significant Accounting Policies of the Notes to Consolidated Financial Statements included in Item 8 of this Annual Report on Form 10-K for information about our significant accounting policies and how estimates are involved in the preparation of our financial statements. We believe the following reflect the critical accounting estimates used in the preparation of our Consolidated Financial Statements.

Rebates and Chargebacks

Rebates and chargebacks include amounts due to payers and healthcare providers under various programs based on contractual arrangements or statutory requirements, which may vary by product, payer and individual plans and may not be known at the time of sale. As a result, our recorded amounts for rebates and chargebacks are determined using a complex estimation process that requires significant management judgment. In developing our estimates of rebates and chargebacks, we consider the following:

•product sales, including product mix and pricing;

•historical and estimated payer mix;

•statutory discount requirements and contractual terms;

•historical claims experience and processing time lags;

•estimated patient population;

•known market events or trends;

•market research;

•channel inventory data obtained from our major U.S. wholesalers; and

•other pertinent internal or external information.

46

The following table summarizes the consolidated activities and ending balances in our rebates and chargebacks accounts, including adjustments made relating to previous years’ sales as a result of changes in estimates:

(in millions)

Balance at Beginning of Year

Decrease/(Increase) to Product Sales

Payments

Balance at End of Year

Year ended December 31, 2025:

Activity related to 2025 sales

$

— 

$

17,880 

$

(13,064)

$

4,816 

Activity related to sales prior to 2025

4,646 

(378)

(3,903)

365 

Total

$

4,646 

$

17,503 

$

(16,967)

$

5,181 

Year ended December 31, 2024:

Activity related to 2024 sales

$

— 

$

15,808 

$

(11,508)

$

4,300 

Activity related to sales prior to 2024

4,493 

(350)

(3,797)

345 

Total

$

4,493 

$

15,458 

$

(15,305)

$

4,646 

We assess and update our estimates each reporting period to reflect actual claims and other current information. Historically, our actual rebates and chargebacks claimed for prior years have varied by less than 5% from our estimates.

Valuation of Intangible Assets

Determining the fair values of intangible assets, whether as part of a business combination or impairment assessment, involves the use of a probability-weighted income approach that discounts expected future cash flows to present value and requires the use of critical estimated inputs, including:

•identification of product candidates with sufficient substance requiring separate recognition;

•estimates of projected future cash flows, including revenues and operating profits related to the products or product candidates, which, for example, include significant inputs such as addressable patient population, treatment duration and projected market share;

•the probability of technical and regulatory success for unapproved product candidates considering their stages of development;

•the time and resources needed to complete the development and approval of product candidates;

•an appropriate discount rate based on the estimated weighted-average cost of capital for companies with profiles similar to our profile, representing the rate that market participants would use to value the intangible assets;

•the life of the potential commercialized products and associated risks, including the inherent difficulties and uncertainties in developing a product candidate such as obtaining FDA and other regulatory approvals; and

•risks related to the viability of and potential alternative treatments in any future target markets.

These estimates are subject to uncertainty due to the high rate of failure inherent in the discovery and development of new products; delays that can occur in development, approval and product launch processes; unanticipated decisions made by regulatory agencies; advent of competing products; unexpected changes in U.S. and global financial markets and other unanticipated events and circumstances. If future events result in adverse changes in the critical assumptions used in determining fair value, impairment charges on our intangible assets may be recorded and could be material to our financial statements. For example, in 2024, upon receiving data from our Phase 3 EVOKE-01 study of Trodelvy, which indicated the study did not meet its primary endpoint, and further discussions with regulators and external opinion leaders and completion of the evaluation of the trial data which led to the strategic decision to end the second-line indication program, we recognized in aggregate $4.2 billion in impairment charges related to our NSCLC IPR&D intangible asset, reflecting, amongst other changes, the removal of expected future cash flows associated with second-line plus patients from our valuation model.

Legal Contingencies

We are a party to various legal actions. Certain significant matters are described in Note 12. Commitments and Contingencies of the Notes to Consolidated Financial Statements included in Item 8 of this Annual Report on Form 10-K.

47

Critical inputs to the accruals recorded and disclosures provided in relation to these matters include the probability of a certain outcome of the case, the determination as to whether an exposure is reasonably estimable and the amount of potential exposure. These inputs are subject to uncertainty due to changes in the legal facts and circumstances of the case, status of the proceedings, applicable law, the views of legal counsel and the views of any judges or jury involved in the case. Upon the final resolution of such matters, it is possible that there may be a loss in excess of the amount recorded, and such amounts could have a material adverse effect on our results of operations, cash flows or financial position. We periodically reassess these matters when additional information becomes available and adjust our estimates and assumptions when facts and circumstances indicate the need for any changes. For example, in the second quarter of 2023, we recorded an accrual of $525 million in Other current liabilities on our Consolidated Balance Sheets for settlements with certain plaintiffs in the HIV antitrust litigation, which we paid in the second half of 2023. Also, as of December 31, 2024, we accrued approximately $200 million on our Consolidated Balance Sheets for a potential settlement with the U.S. Attorney’s Office for the Southern District of New York, which we eventually entered into in April 2025 and subsequently paid.

Income Taxes

We are subject to income taxes in the U.S. and various foreign jurisdictions, including Ireland. See Note 15. Income Taxes of the Notes to Consolidated Financial Statements included in Item 8 of this Annual Report on Form 10-K for additional information. Critical inputs in determining our provision for income taxes and related tax balances include forecasts of our future income and expenses, potential tax planning strategies and determination of the probability of certain tax positions being sustained upon examination by tax authorities. These inputs are subject to uncertainty due to potential changes in facts and circumstances, economic and political conditions, changes to existing tax laws and new regulations or interpretations by tax authorities. Changes in these conditions could have a material adverse impact on our results of operations and financial position. For example, in October 2025, we reached a settlement with a tax authority related to a prior year legal entity restructuring. As a result, we recognized approximately $450 million of income tax benefit and a corresponding $530 million reduction in our unrecognized tax benefits in the quarter ending December 31, 2025.

48