Incyte (INCY) closed out FY 2025 with fourth quarter revenue of US$1.5 billion and basic EPS of US$1.52, alongside trailing 12 month revenue of US$5.1 billion and EPS of US$6.59 that sit against very large year over year earnings growth and a trailing net margin of 25%. Over the past year, revenue has moved from US$4.2 billion on a trailing basis to US$5.1 billion, while quarterly EPS has ranged from US$0.82 in Q1 2025 to US$2.17 in Q3 and US$1.52 in Q4. This gives investors a clearer read on how the earnings run rate is developing as profitability has broadened out. These results point to a business where margins have become a key part of the story, setting up an earnings season where the focus is on how durable that profitability really is.

See our full analysis for Incyte.

With the headline numbers on the table, the next step is to see how this earnings profile lines up against the widely held narratives around Incyte's growth prospects, risks and long term profit potential.

TTM net margin jumps to 25%

• Over the last 12 months, Incyte earned US$1.3b of net income on US$5.1b of revenue, giving a trailing net margin of 25% compared with 0.8% a year earlier.
• Consensus narrative points to rising spending and competitive pressure, yet the current 25% margin sits alongside guidance that operating expenses grow more slowly than revenue, which
  • fits with the idea that a broader product mix across Jakafi, Opzelura, Niktimvo, Monjuvi and Zynyz can support margin resilience even as pricing pressure is highlighted, and
  • pushes investors to compare this margin profile with forecasts that earnings are expected to decline 13.3% a year and revenue 1.5% a year, which is a very different path from the recent profitability figures.

Quarterly EPS swings highlight volatility

• In FY 2025, basic EPS moved from US$0.82 in Q1 to US$2.09 in Q2, US$2.17 in Q3 and US$1.52 in Q4, while trailing 12 month EPS ended at US$6.59.
• Bears argue that reliance on Jakafi and mixed trial outcomes could pressure future earnings, and these EPS swings give some context
  • because the wide range in quarterly EPS comes alongside forecasts that earnings may decline 13.3% a year, which critics link to patent expiry risk and potential biosimilar competition, and
  • since R&D and SG&A are cited as rising faster than historical averages, investors can use this variability as a reminder that quarterly profit can move around as late stage programs advance or face delays.

Have a closer look at how optimistic investors connect this margin profile and revenue base to future upside in their Incyte thesis, and see where the numbers push back against that view. 🐂 Incyte Bull Case

P/E at 15.1x with split views on value

• The trailing P/E sits at 15.1x against a current share price of US$98.84, below peer and US biotech averages, while a DCF fair value of US$91.92 is below that price.
• Consensus narrative highlights both upside from late stage launches and pressure from upcoming patent cliffs, and today’s valuation reflects that mixed picture
  • because a 15.1x P/E is lower than the peer and sector averages even after trailing earnings grew by a very large multiple off last year’s base, which suggests the market is not assigning a premium multiple to that recent profit run, and
  • because the DCF fair value of US$91.92 is under the US$98.84 share price while analyst targets cluster around 105.77, investors effectively have three reference points that each embed different assumptions about how quickly earnings move from the current 25% margin level toward the forecast 13.3% yearly decline.

Skeptical investors often focus on those DCF and patent cliff concerns, so it can help to see how the full bear case frames the same numbers and why some expect weaker long run value creation. 🐻 Incyte Bear Case

Next Steps

To see how these results tie into long-term growth, risks, and valuation, check out the full range of community narratives for Incyte on Simply Wall St. Add the company to your watchlist or portfolio so you'll be alerted when the story evolves.

See the numbers differently? If this data leads you to a different conclusion, shape that view into your own narrative in just a few minutes: Do it your way

A great starting point for your Incyte research is our analysis highlighting 3 key rewards and 2 important warning signs that could impact your investment decision.

See What Else Is Out There

Incyte’s story mixes a 25% net margin with forecasts that earnings decline 13.3% a year, leaving investors debating whether today’s 15.1x P/E really reflects that risk.

If that gap between strong current profitability and uneasy forecast trends makes you cautious, it could be worth checking our 85 resilient stocks with low risk scores that may offer businesses with steadier profiles and fewer potential surprises.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.