$19.3B Quarter, Key Products +91%, FY26 Guide of $80–83B Revenue and a Pipeline That Just Doesn't Quit: Maintaining Outperform

Rating Action: Maintaining Outperform — The Q3 Upgrade Validated

Our LLY coverage walks a deliberate arc through 2025:

• Q2 2025 — Initiating at Hold (constructive bias). We took up coverage with the view that Lilly was the highest-quality fundamental franchise in large-cap pharma but that two specific risks had to clear before we could move past Hold: (a) the manufacturing build-out had to demonstrate it could carry the demand at scale and pace without quality slips, and (b) whether orforglipron's Phase III readout cycle could match injectable-comparable efficacy. Constructive bias reflected the strength of the underlying engine; Hold reflected those two unresolved variables.
• Q3 2025 — Upgrading to Outperform. Six positive Phase III orforglipron readouts cleared the regulatory gating concern; the international Mounjaro ramp confirmed OUS volumes could carry growth as US obesity matured; share gains in US incretins continued for a fifth consecutive quarter; and the FY25 guide raise signaled management still saw underlying-demand upside. We moved to Outperform on the durable-leadership case being decisively confirmed.
• Q4 2025 — Maintaining Outperform. The Q4 print plus the FY26 guide validates the Q3 upgrade. The Medicare obesity agreement is signed with a July 1, 2026 effective date and a $50/month patient out-of-pocket; the price drag is now disclosed and quantified at low- to mid-teens (and absorbed into a guide that still grows +25%). Manufacturing capacity is demonstrably caught up — 2025 incretin doses were 1.8x 2024 doses, exceeding management's own goal. Orforglipron obesity submission is now in the US plus 40+ countries with FDA approval expected Q2 2026, and ATTAIN-MAINTAIN provides switching-claim evidence that meaningfully strengthens the oral-GLP-1 launch narrative. We maintain Outperform; the catalyst stack into 2026 is the cleanest in large-cap pharma.

Results vs. Consensus

Q4 2025 prints as a clean beat against street consensus on every operating line. Revenue of $19.3B grew 43% YoY against a comparison that already included the early Mounjaro/Zepbound ramp; non-GAAP EPS of $7.54 grew 42% YoY despite $0.52 of acquired-IPR&D charges; non-GAAP performance margin of 47.2% expanded by 420 bps YoY against a quarter that already exhibited operating leverage. Gross margin of 83.2% held flat YoY despite the price drag that began materializing in Q4 — favorable mix and improved production cost offsetting realized-price erosion is exactly the operating dynamic the bull case requires.

Quality of Beat

• Revenue: +43% YoY on a Q4 2024 base that already had Mounjaro/Zepbound at scale is the cleanest growth print large-cap pharma has produced in our coverage. The 7% US price decline is a material headwind absorbed entirely by volume; double-digit ex-US volume growth in Europe, Japan, and China provides geographic diversification beyond the US incretin story.
• Margins: Gross margin held at 83.2% despite price erosion, because favorable product mix (key products at +91% YoY are higher-GM than the legacy portfolio) and improved production economics offset the realized-price decline. Performance margin expansion of 420 bps to 47.2% confirms operating leverage at scale even as Lilly continues investing aggressively (R&D +26%, SG&A +29% in the quarter).
• EPS: $7.54 non-GAAP, +42% YoY, includes a $0.52 acquired-IPR&D charge. Reported (GAAP) EPS of $7.39 grew +51% YoY; the spread between GAAP and non-GAAP is narrower than typical because the IPR&D charges are now included in non-GAAP. The 19.7% effective tax rate is elevated vs. the high-teens we'd modeled but the EPS still beats; margin expansion did the work.
• Cash return: $1.3B in dividends and $1.5B in share repurchases in 2025. Capital return is decidedly secondary to the manufacturing capex story ($55B committed since 2020), and that's the right priority — the franchise's reinvestment opportunity dominates any incremental buyback yield.

Segment Performance

Cardiometabolic Health: Mounjaro and Zepbound Drive the Engine

The cardiometabolic franchise remains the engine. Zepbound revenue more than doubled YoY in Q4 with nearly 70% share of US new branded obesity prescriptions. The vials channel (the self-pay direct-to-patient offering) hit approximately one-third of total Zepbound prescriptions and nearly 50% of new prescriptions, validating the cash-pay/DTC model that management built through Lilly Direct — this is functionally a consumer-products business layered on top of a prescription drug, and it's working.

Mounjaro exited Q4 with >55% share of US new T2D incretin prescriptions. Outside the US, Mounjaro now leads the ex-US incretin share-of-market position as well, with double-digit volume growth in Europe, Japan, and China and "rest of world" volume doubling YoY on the back of major-market launches. International Mounjaro revenue printed approximately $3.3B in Q4. The combined US incretin analog market grew total prescriptions by +33% YoY in Q4, and management's framing that obesity-population penetration is still mid-single digits indicates the runway has years left.

"As market penetration within the population of people with obesity is only mid-single digits, we believe there is room for market expansion and sustained market growth in the quarters and years to come." — Lucas Montarce, CFO

Neuroscience: Kisanlo Becomes Category Leader

Kisanlo (donanemab) revenue of $109M in Q4 reflects the early-launch phase, but the strategic data point is that Kisanlo became the US market leader in amyloid-targeting Alzheimer's therapy with >50% share of total prescriptions. Drivers cited were market growth, increased awareness/diagnosis, and prescriber adoption based on Kisanlo's clinical profile vs. the alternative. The category is small in absolute dollars today but the structural setup — a category leader in the early years of an Alzheimer's therapeutic market that should grow into a multi-billion franchise — is the right anchor for long-cycle modeling.

Immunology and Oncology: Real Contribution, Not Just Footnotes

The non-cardiometabolic portfolio added meaningfully in Q4: Omvo grew +55% YoY globally; Jayperca (pirtobrutinib) grew +30% YoY with the FDA expanded approval in Q4 to include CLL/SLL patients previously treated with covalent BTK inhibitors (a meaningful eligible-population expansion); Eblis in atopic dermatitis posted a +25% sequential prescription increase from Q3. Verzenio grew only +3% globally on US plateau dynamics — the lone meaningful softness in the major-product complex, and a known/expected one given market penetration in early breast cancer.

Key Topics & Management Commentary

Overall Management Tone: Confident, granular, and forward-looking. Ricks framed 2025 as "a strong year" and walked the operating wins systematically; Montarce delivered the FY26 guide with clear articulation of the price-volume bridge; Skovronsky's R&D update was the most catalyst-dense single segment of any pharma call we've covered this cycle. The notable absence of executional caveats — no compounding-pharmacy diversion language, no shortage-list framing, no quality-issue mentions — signals that the supply discipline that punctuated 2023–2024 is structurally past.

The $55B Manufacturing Build-Out

Ricks reiterated that Lilly has committed over $55B since 2020 to manufacturing capacity — the largest manufacturing build-out in company history. Wisconsin and North Carolina sites came online in 2025; multiple new US and European sites are in construction. The 2025 incretin dose output was 1.8x the 2024 figure, exceeding the stated goal.

"Since 2020, we've committed over $55 billion, the largest manufacturing build-out in company history. We exceeded our goal to produce 1.8 times the number of incretin doses in 2025 compared to 2024." — David Ricks, CEO

Assessment: This is the supply-side data point that closes the 2023–2024 capacity narrative. With dose output 1.8x year-over-year and major US sites online, Lilly enters 2026 with the infrastructure to absorb both organic Mounjaro/Zepbound demand growth and the orforglipron oral-GLP-1 launch without recurrence of the shortage-list / compounding-pharmacy dynamic that defined the early years.

Medicare Obesity Access — July 1, 2026 Effective

Ricks confirmed that Lilly has signed an agreement with the US government to provide access to obesity medicines for Medicare and Medicaid populations, with a $50 monthly out-of-pocket cost for eligible patients. Management expects the new Medicare access to be effective no later than July 1, 2026.

"We're proud of our ability to bring these important medicines to patients at a cost of only $50 per month out of pocket... We anticipate new Medicare access to obesity medicines will become effective no later than July 1, 2026." — David Ricks, CEO and Lucas Montarce, CFO

Assessment: The Medicare access agreement was the single biggest unresolved Q3 2025 risk on our coverage. The terms are now public: $50/month patient out-of-pocket, July 1 effective date, open to multiple manufacturers (analogous to the Part D senior-savings insulin model). Ricks drew the explicit insulin-pilot analog and pointed to the historical pattern of "utilization rates increased pretty dramatically in Part D and frustration levels with that issue basically disappeared." The pricing concession is real (low- to mid-teens FY26 price drag), but it's known, quantified, and offset by what Lilly believes will be material volume expansion.

Orforglipron: Q2 2026 US Approval Expected

Skovronsky outlined the orforglipron timeline: submitted to FDA for obesity treatment with approval expected Q2 2026; submitted in 40+ countries; international launches mainly 2027 with select 2026 launches in markets like UAE; T2D submission later this year after Achieve IV completes; Phase 3 cardiovascular outcomes trials and peripheral artery disease trials initiated. The ATTAIN-MAINTAIN study (orforglipron weight maintenance after switching from injectable semaglutide or tirzepatide) hit all primary and secondary endpoints; patients who switched from semaglutide to orforglipron maintained their weight loss with an average difference of just 0.9 kg, and patients switching from maximum tirzepatide doses maintained "much of their weight" with an average 5 kg difference.

Assessment: Orforglipron at Q2 2026 US obesity approval is the proximate catalyst that anchors our Outperform rating. The asset is differentiated as a true oral GLP-1 with no food/water restrictions; the competitive positioning is favorable vs. oral semaglutide (where uptake to date has been "mostly new starts" per Custer, signaling market expansion rather than cannibalization); and the ATTAIN-MAINTAIN data establishes a switching claim that materially strengthens the launch narrative.

Retatrutide: 29% Weight Loss and Six 2026 Phase 3 Readouts

Skovronsky disclosed top-line TRIUMPH-4 results: retatrutide at the 12 mg dose produced 29% body-weight reduction at 68 weeks in patients with obesity and knee osteoarthritis — the highest weight loss observed in the incretin class to date. Pain reduction averaged 76% and one in eight retatrutide-treated patients were "completely free from knee pain at the end of this trial." Six additional Phase 3 retatrutide readouts are expected in 2026, including the core registration package for both obesity (TRIUMPH program) and T2D (Transcend program). Submission to support obesity, obstructive sleep apnea, and osteoarthritis indications is targeted for 2026.

Assessment: Retatrutide is the third-leg incretin behind tirzepatide and orforglipron and the data profile suggests it slots into a higher-BMI / more-severe-comorbidity segment where 29% body-weight reduction has clinical relevance that 20% does not. The discontinuation profile in lower-BMI patients (excessive weight loss leading to discontinuation) is the safety signal to monitor, but the 84% of trial population at BMI ≥35 had discontinuation rates consistent with other injectable incretins. This is a real-and-different asset, not a tirzepatide replacement.

Pipeline Breadth: 36 Active Phase 3 Programs

Lilly has 36 active Phase 3 programs in pipeline, has launched 14 new Phase 3 programs in recent months, executed 39 business development transactions in 2025, and continues investing in AI for drug discovery (NVIDIA collaboration announced for AI co-innovation lab). Beyond the incretin and amylin portfolio, the immunology, oncology, and neuroscience pipelines all advanced multiple assets including imlunestrant in adjuvant breast cancer (EMBER-4 fully enrolled), sofetibart-mepetekcan ADC in ovarian cancer, brenepatide expansion into substance use disorders and major depressive disorder, and donanemab in pre-symptomatic Alzheimer's (Trailblazer ALZ-3).

Capital Allocation

FY25 distributed $1.3B in dividends and $1.5B in share repurchases. The capex story dominates: Lilly's reinvestment opportunity in capacity, R&D, and BD is the right priority over incremental buyback yield. With FY25 EPS at $24.21 and FY26 guided to $33.50–35, the cash-flow runway easily supports both the manufacturing build-out and continued capital return at scale.

Guidance: FY 2026 Framework

The FY26 framework is the cleanest articulation of the volume-vs-pricing dynamic Lilly has put on a single slide. The +25% revenue midpoint is achieved with low- to mid-teens price drag, which means underlying volume is growing closer to +40%. The components of the price drag are explicitly enumerated: (a) Medicare obesity access agreement, (b) updated direct-to-patient Zepbound pricing, (c) lower Medicaid prices on later-life-cycle medicines, (d) Mounjaro NRDL inclusion in China for T2D effective January 1, 2026.

EPS guide of $33.50–35 implies +40% YoY growth at the midpoint — well above the +25% revenue line, which means operating leverage continues to work. Performance margin of 46–47.5% is roughly flat with FY25 implied; the consistency reflects management's stated investment posture (R&D scaling up to support 36 active Phase 3 programs and new program initiations; SG&A investing in launches across therapeutic areas). The "fully invest in variable expenses while controlling fixed costs by leveraging existing commercial footprint" framing is exactly the right posture for a multi-launch year.

Within the guide: Eblis, Jayperca, Inlureo, Kisanlo, and Omvo are flagged as growth contributors; Trulicity, Talsa, and Verzenio are flagged as flat to declining (the legacy/late-life-cycle complex). Orforglipron US obesity launch is in-guide for 2026; international orforglipron launches are mainly 2027 (with limited 2026 contribution from markets like UAE that may reference FDA approval). Medicare obesity access ramps in 2H 2026 with the July 1 effective date; management expects 10–20% of the existing Lilly Direct DTC patient bolus to migrate into Medicare relatively quickly, then build over time.

Analyst Q&A Highlights

FY 2026 Revenue Guide Composition (Steve Scala, TD Cowen)

• Asked whether the +$15–20B incremental revenue can be delivered without orforglipron being a $5B 2026 product, and whether the guide implies oral GLP-1 grows the market rather than cannibalizes. Montarce affirmed that the bottom-up guidance reflects multiple components — Medicare expansion, orforglipron launch, US/ex-US incretin growth — with the price erosion now embedded as an explicit low- to mid-teens drag. The early competitor oral GLP-1 launch data, per Montarce, is "mainly expansion of the market," consistent with Lilly's own modeling assumptions.
  Assessment: The composition is layered and plausible. Even without orforglipron at $5B, the Mounjaro/Zepbound trajectory plus international ramp plus key-product diversification gets a meaningful share of the +$15–20B. Orforglipron is incremental upside, not the entirety of the bridge.

Medicare Volume Ramp and Employer Opt-In (Terence Flynn, Morgan Stanley)

• Asked about Medicare volume ramp in 2H 2026 and whether the Medicare deal triggers commercial employer-side opt-in increases. Montarce confirmed July 1 effective date with relatively fast initial Medicare uptake from the existing Lilly Direct patient base (10–20% migration), then continued build. Yuffa added that employer space starts 2026 "roughly on balance" with some additions and removals; the firm has stood up dedicated employer-engagement teams and third-party access channels; most decisions are for the following plan year, so meaningful 2027 employer-side coverage expansion is the stronger near-term signal.
  Assessment: The Medicare ramp is back-half loaded and cumulative; the employer-side opt-in is more of a 2027 story. Both are positive multi-year drivers, but neither materially changes the FY26 numbers.

Pricing and Cash-Pay Dynamics (Asad Haider, Goldman Sachs; Umer Raffat, Evercore)

• Pressed on commercial contracting dynamics across the incretin portfolio and price elasticity in the cash channel. Yuffa confirmed Zepbound coverage in two of three large PBMs continuing into 2026, with active discussions to expand access for orforglipron's Q2 launch. The cash-pay business has demonstrated meaningful uptake at the $299 entry-price point for Zepbound vials and the orforglipron entry price will be similar to oral semaglutide. Raffat probed the long-term implications of cash-pay as a structural channel; Ricks acknowledged cash-pay is "a bit of a wildcard" for short and midterm outlook with no clean industry analog — possibly closest to PDE5/ED-drug consumer dynamics or aesthetics, but with profound health benefits attached.
  Assessment: Cash-pay at scale is the structural innovation that distinguishes the LLY franchise from a typical pharma model. The demonstrated price-elasticity response (vial uptake at $299, oral-semaglutide-comparable orforglipron entry pricing) plus the consumer-platform infrastructure (Lilly Direct at 1M patients) suggests this is a durable channel rather than a temporary expedient. Ricks' inability to name a clean industry analog is the right intellectual posture — this is something genuinely new at this scale.

Combination Therapies in Immunology and Other Indications (Geoffrey Meacham, Citi; Seamus Fernandez, Guggenheim)

• Multiple analysts pushed on combination therapies (incretins plus immunology, incretins in substance use disorders, MDD, etc.) and the strategic question of whether Lilly should attack immunology with the same aggressiveness as obesity. Skovronsky and Anne White outlined the combination program: Together-PSA (positive top-line ixekizumab + tirzepatide), Together-PSO (psoriasis readout in 2026), Together-Amplified studies, COMMIT studies in UC and Crohn's, brenepatide Phase 2 in asthma. The "weight-independent mechanism" finding from Together-PSA is the differentiating claim that opens a much broader application surface.
  Assessment: The combination thesis — that incretins have weight-independent immunomodulatory effects in inflammatory diseases — would be transformative if validated across additional indications. The 2026 Together-PSO and brenepatide-asthma readouts are the next data points to watch.

Orforglipron Launch Mechanics (Michael Yee, UBS; Evan Seigerman, BMO)

• Asked how orforglipron launch dynamics differ from the original tirzepatide launch given the larger existing market and consumer awareness. Yuffa noted the meaningful structural difference: orforglipron launches into a category with high consumer awareness, an at-scale DTC platform, significant cash-pay infrastructure, and elevated patient willingness to seek therapy — vs. tirzepatide's launch from a much earlier point in the market-development curve. Custer added that success metrics will include market expansion (validated by oral semaglutide's expansion-not-cannibalization pattern), patient satisfaction, and real-world efficacy.
  Assessment: Orforglipron has structural launch advantages tirzepatide did not enjoy. Combined with the weight-loss-maintenance claim from ATTAIN-MAINTAIN, the launch could exceed pre-call sell-side modeling.

What They're NOT Saying

1. FY26 segment-level revenue or product-level guidance. Conspicuously absent. Management gave a top-line revenue range and a price-vs-volume framework, but no breakdown by major product (Zepbound, Mounjaro, orforglipron, Kisanlo, Omvo, Jayperca). The street will fill the gap with a wide range of bottom-up models — orforglipron 2026 contribution estimates likely span $2–6B.
2. FY26 capex specifics. Management cited the $55B cumulative manufacturing commitment since 2020 but did not give a 2026 capex figure. With multiple new sites in construction, capex is likely an elevated line item that will pressure FCF in 2026; the absence of a specific number is a model-affecting omission.
3. Mounjaro NRDL pricing impact specifics. Management flagged China NRDL listing as a price drag component but did not quantify the magnitude or the offset from volume expansion. China is a multi-hundred-million-dollar revenue line that's now in price-controlled-coverage territory; the FY26 trajectory deserves more granularity.
4. Trailblazer ALZ-3 (donanemab) timing specifics. Skovronsky noted that the trial reads out when target progression events accrue; the primary completion is "projected for 2027." A 2026 readout is possible but not committed; the optionality is real but not modeled.
5. Imlunestrant (EMBER-4) adjuvant breast cancer readout timing. The trial is "fully enrolled" but no specific readout window was given. This is a potentially major franchise-extending data point on the oncology side; the absence of timing is a meaningful information gap.
6. Tax rate trajectory. Q4 2025 came in at 19.7%, elevated vs. the high-teens range we'd modeled. No specific FY26 tax rate guide. With the IRA pricing dynamics and ongoing geographic mix changes, tax rate is a non-trivial line for the EPS bridge.
7. Verzenio plateau response. US has "reached a plateau" per Montarce. No commentary on what management is doing about it (label expansion attempts, lifecycle extensions, or accepting decline). Verzenio's $5B+ run-rate makes its trajectory non-trivial.

Market Reaction

• Pre-print context: LLY entered the print after a 2H 2025 consolidation, with multiple compressed by elevated rates and the persistent overhang of obesity-pricing/Medicare uncertainty. Forward P/E heading into the print was in the low-to-mid 30s — a meaningful step down from the mid-40s peak in 2024, reflecting the policy backdrop more than fundamental change.
• Headline reaction: The Q4 print plus the FY26 guide is positive on every measurable axis. The market reaction was constructive but not euphoric — the pricing-drag disclosure (low- to mid-teens) is real and was being absorbed by the buyside, even though the volume engine offset more than makes up for it.
• Cited reasons for relative restraint: (1) the price drag, while quantified, materially compresses the FY26 revenue growth optics from "looks like +35-40%" to "guides +25%"; (2) FY26 EPS midpoint of $34.25 was approximately in line with consensus before the call, with limited room for "beat-and-raise" celebration; (3) capex and R&D scale-up indicates flat-to-down performance margin, capping near-term operating-leverage upside; (4) competitive concerns around Novo's oral GLP-1 launch trajectory and the Roche/Pfizer pipeline catch-up activity in 2026.
• Our read: The market is treating this as a "good but not surprise-good" print. We disagree at the margin — the FY26 guide composition (volume +40% absorbing pricing -15%) is structurally stronger than the headline +25% revenue suggests, and the pipeline catalyst density into 2026 should compound multiple expansion as catalyst-by-catalyst de-risking proceeds.

Street Perspective

Debate: Is the FY 2026 +25% revenue guide conservative or full?

Bull view: Conservative. Management has historically guided cautiously and beaten on both volume and operating leverage. The price drag is the most aggressive-looking number management has put on a slide (low- to mid-teens) and likely reflects worst-case assumptions on Medicare, NRDL, and DTC. Volume is structurally above the guided level given orforglipron upside, retatrutide future contribution (limited 2026, but 2027+), Medicare ramp acceleration in 2H, and continued international expansion. FY26 prints with material upside vs. the $80–83B guide range.

Bear view: Full. The FY26 guide already assumes industry-leading volume growth absorbing low- to mid-teens price drag. Push-back factors: (a) competitive dynamics with Novo's oral GLP-1 plus Roche/Pfizer pipeline catch-up could pressure share gains at the margin; (b) employer opt-in is a 2027 story, limiting 2026 commercial-segment expansion; (c) capex and R&D scale-up means operating leverage stalls vs. 2025; (d) IRA negotiation overhang for tirzepatide eligibility in later years is a multi-year valuation concern not fully reflected in 2026 numbers. The +25% growth is a stretch, not a layup.

Our take: The bull is closer to right. Lilly's track record of guiding conservatively in early-year communications and beating subsequent quarters supports the conservative-guide framing. The pricing-drag disclosure is granular enough that we treat it as a hard floor rather than a working assumption; volume offset is the variable that has consistently surprised to the upside. We model FY26 revenue at the upper end of the range ($82–84B) with EPS at $34.50–36, modestly above the midpoint of the guide.

Debate: Does cash-pay structurally change the equity story?

Bull view: Yes. Lilly has built a direct-to-consumer infrastructure (Lilly Direct, 1M patients in 2025) that is materially different from a traditional PBM-mediated pharma franchise. The cash-pay business reduces PBM dependency, captures first-party consumer data, supports subscription/loyalty pricing models, and creates the platform for future-product launches (orforglipron, retatrutide, oloralintide) at consumer-grade marketing efficiency. Over time this could justify a multiple closer to consumer-staples than to traditional pharma.

Bear view: No. Cash-pay is a temporary feature of an under-coverage market dynamic; once Medicare and broader employer coverage normalize, the cash-pay channel reverts to a niche supplementary product. The "no industry analog" framing Ricks acknowledged on the call is a fair description of the uncertainty, but uncertainty cuts both ways — the lack of comparable franchise valuations means the bull thesis on multiple expansion has weak external validation.

Our take: The bull view is structurally right, but the timeline is longer than a single guidance cycle. Cash-pay at 1M patients with a self-pay vials channel at one-third of total Zepbound prescriptions is a real consumer franchise, not a coverage-gap byproduct. The valuation implication won't appear cleanly in any one quarter; it'll compound across 2026–2028 as the franchise demonstrates durability through the Medicare-coverage transition and the orforglipron launch.

Model Implications: FY 2026 Setup

Valuation impact: Our prior fair-value framework reflected the Hold rating at Q3 with no specific price target band. Updating to Outperform with FY26 EPS midpoint of ~$35 and a 12-month forward multiple of 27–32x (above the post-2024 compressed range but below the 2024 peak), our fair-value range is approximately $945–1,120 per share. We treat this as a wide range given the multi-year compounding nature of the orforglipron + retatrutide cycle; the central case sits at the lower end of that band, with the upper end requiring continued multiple expansion as catalyst-by-catalyst de-risking proceeds through 2026.

Thesis Scorecard Post-Earnings

Overall: Eight bull points confirmed (seven existing strongly + one new), six bear points either quantified, contained, or to-monitor with no critical worsening. The operating thesis is unequivocally stronger than at the Q2 2025 initiation, the supply-side and Medicare-access concerns that gated Hold have cleared, and the pipeline catalyst density into 2026 is exceptional.

Action: Maintaining Outperform. The Q4 print plus the FY26 guide validates the Q3 2025 upgrade. The orforglipron Q2 2026 US approval is the proximate catalyst; retatrutide's six 2026 Phase 3 readouts compound the case; combination-therapy data extends the franchise's TAM into immunology; and the cash-pay/DTC infrastructure is a structural advantage that compounds across the 2026–2028 launch cycle. We maintain LLY at Outperform with a fair-value range of approximately $945–1,120 per share. The risk-reward at the current multiple is reinforced by the FY26 guide reset.