Stock Analysis on Net
Stock Analysis on Net

Gilead Sciences Inc. (NASDAQ:GILD)

Common-Size Income Statement

Gilead Sciences Inc., common-size consolidated income statement

Microsoft Excel
12 months ended: Dec 31, 2025 Dec 31, 2024 Dec 31, 2023 Dec 31, 2022 Dec 31, 2021
Product sales 100.00 100.00 100.00 100.00 100.00
Cost of goods sold -21.56 -21.85 -24.13 -20.97 -24.44
Gross profit on product sales 78.44% 78.15% 75.87% 79.03% 75.56%
Royalty, contract and other revenues 1.83 0.50 0.68 1.11 1.10
Research and development expenses -20.06 -20.65 -21.23 -18.45 -19.86
Acquired in-process research and development expenses -3.54 -16.30 -4.29 -3.50 -0.66
In-process research and development impairment -2.04 -14.61 -0.19 -10.01 0.00
Selling, general and administrative expenses -19.97 -21.29 -22.61 -21.03 -19.42
Operating income 34.66% 5.81% 28.24% 27.17% 36.72%
Interest expense -3.54 -3.41 -3.50 -3.47 -3.71
Gain (loss) from equity securities, net 1.56 -0.96 -0.62 -2.43 0.00
Interest income 1.21 0.98 1.40 0.39 0.00
Other, net -0.01 -0.01 -0.04 -0.11 -2.37
Other income (expense), net 2.76% 0.02% 0.74% -2.15% -2.37%
Income before income taxes 33.88% 2.41% 25.47% 21.55% 30.65%
Income tax expense -4.45 -0.73 -4.63 -4.63 -7.69
Net income 29.43% 1.68% 20.84% 16.92% 22.96%
Net loss attributable to noncontrolling interest 0.00 0.00 0.19 0.10 0.09
Net income attributable to Gilead 29.43% 1.68% 21.03% 17.02% 23.05%

Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).

The common-size income statement reveals significant fluctuations in profitability and expense management over the five-year period. Product sales are consistently represented as 100% of revenue, allowing for a clear view of expense and profit margins as percentages of sales. A notable trend is the volatility in operating income and net income attributable to Gilead, indicating a period of instability followed by substantial recovery.

Gross Profit
Gross profit on product sales demonstrates a fluctuating pattern, beginning at 75.56% in 2021, increasing to 79.03% in 2022, then decreasing to 75.87% in 2023. It recovers to 78.15% in 2024 before reaching 78.44% in 2025. This suggests some variability in production costs or pricing strategies.
Research and Development
Research and development expenses consistently represent a substantial portion of product sales, ranging from 18.45% to 21.23%. However, acquired in-process research and development expenses and related impairment charges show significant volatility. These expenses increased substantially from 0.66% in 2021 to 4.29% in 2023, peaking at 16.30% in 2024 before decreasing to 3.54% in 2025. The presence of in-process research and development impairment further complicates the picture, with notable impacts in 2022, 2023, and 2024.
Operating Income
Operating income as a percentage of product sales experienced a substantial decline from 36.72% in 2021 to 27.17% in 2022, and 28.24% in 2023. A dramatic drop occurred in 2024, falling to 5.81%, before a strong recovery to 34.66% in 2025. This suggests significant challenges in maintaining profitability during 2024, followed by a successful turnaround.
Net Income
Net income mirrors the trend in operating income, declining from 22.96% in 2021 to 16.92% in 2022, increasing to 20.84% in 2023, plummeting to 1.68% in 2024, and then rebounding sharply to 29.43% in 2025. This indicates that changes in operating performance are directly impacting the bottom line.
Other Income and Expenses
Other income (expense), net, fluctuated considerably, moving from a negative 2.37% in 2021 to a positive 2.76% in 2025. Gains (losses) from equity securities also contributed to volatility, particularly the negative impact of -2.43% in 2022. Interest expense remained relatively stable, consistently around 3.5% of product sales.
Tax Rate
The effective tax rate, calculated as income tax expense divided by income before income taxes, varied significantly. It was 25.28% in 2021, 21.58% in 2022, 21.68% in 2023, 31.87% in 2024, and 13.03% in 2025. These fluctuations likely reflect changes in taxable income and applicable tax laws.

Overall, the period examined demonstrates a company navigating a dynamic environment. The significant decline in operating and net income in 2024, followed by a strong recovery in 2025, warrants further investigation to understand the underlying drivers of these changes. The substantial fluctuations in acquired in-process research and development expenses and related impairments also require attention.

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