Income Statement

The income statement presents information on the financial results of a company business activities over a period of time. The income statement communicates how much revenue the company generated during a period and what cost it incurred in connection with generating that revenue.

Vertex Pharmaceuticals Inc., consolidated income statement

US$ in thousands

12 months ended:	Dec 31, 2025	Dec 31, 2024	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021
Product revenues, net	11,970,600)	11,020,100)	9,869,200)	8,930,700)	7,573,400)
Other revenues	30,700)	—)	—)	—)	1,000)
Revenues	12,001,300)	11,020,100)	9,869,200)	8,930,700)	7,574,400)
Cost of sales	(1,651,300)	(1,530,500)	(1,262,200)	(1,080,300)	(904,200)
Gross profit	10,350,000)	9,489,600)	8,607,000)	7,850,400)	6,670,200)
Research and development expenses	(3,909,500)	(3,630,300)	(3,162,900)	(2,540,300)	(1,937,800)
Acquired in-process research and development expenses	(133,000)	(4,628,400)	(527,100)	(115,500)	(1,113,300)
Selling, general and administrative expenses	(1,753,100)	(1,464,300)	(1,136,600)	(944,700)	(840,100)
Intangible asset impairment charge	(379,000)	—)	—)	—)	—)
Change in fair value of contingent consideration	(2,100)	500)	51,600)	57,500)	3,100)
Income (loss) from operations	4,173,300)	(232,900)	3,832,000)	4,307,400)	2,782,100)
Interest income	490,900)	598,100)	614,700)	144,600)	4,900)
Interest expense	(13,300)	(30,600)	(44,100)	(54,800)	(61,500)
Other income (expense), net	(7,700)	(86,100)	(22,800)	(164,800)	4,900)
Income before provision for income taxes	4,643,200)	248,500)	4,379,800)	4,232,400)	2,730,400)
Provision for income taxes	(690,000)	(784,100)	(760,200)	(910,400)	(388,300)
Net income (loss)	3,953,200)	(535,600)	3,619,600)	3,322,000)	2,342,100)

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 financial performance presented demonstrates a generally positive trajectory in revenue and profitability, though with notable fluctuations, particularly in 2024. Product revenues, net, consistently increased from 2021 to 2025, growing from US$7,573.4 million to US$11,970.6 million. A small contribution from other revenues appears in 2025, reaching US$30.7 million. Overall revenues mirror this growth, increasing from US$7,574.4 million to US$12,001.3 million over the five-year period.

Cost of sales exhibited a steady increase throughout the period, rising from US$904.2 million in 2021 to US$1,651.3 million in 2025. This increase, while substantial in absolute terms, remained proportionally lower than the growth in revenues, resulting in expanding gross profit margins. Gross profit increased from US$6,670.2 million to US$10,350.0 million. However, operating income experienced significant volatility. While positive and growing from 2021 to 2023, it turned negative in 2024 before recovering strongly in 2025.

Operating Expenses: Research and development expenses consistently increased from US$1,937.8 million in 2021 to US$3,909.5 million in 2025, indicating a continued investment in innovation. Selling, general and administrative expenses also rose steadily, from US$840.1 million to US$1,753.1 million. A significant acquired in-process research and development expense was recorded in 2024 (US$4,628.4 million), contributing substantially to the operating loss in that year. An intangible asset impairment charge of US$379.0 million further impacted 2025 results.

Non-operating items showed fluctuations. Interest income increased significantly from 2021 to 2023, then stabilized. Interest expense decreased steadily over the period. Other income (expense), net, was volatile, with a large expense recorded in 2022. Income before provision for income taxes followed the trend of operating income, with a substantial dip in 2024 before a strong recovery in 2025.

Profitability: Net income mirrored the overall trend, increasing from US$2,342.1 million in 2021 to US$3,619.6 million in 2023, experiencing a net loss of US$535.6 million in 2024, and rebounding to a net income of US$3,953.2 million in 2025. The provision for income taxes remained relatively stable as a percentage of income before taxes, though the absolute amount varied with pre-tax income.

The year 2024 stands out as an anomaly, with a significant operating loss and net loss, primarily driven by the substantial acquired in-process research and development expense and intangible asset impairment charge. The recovery in 2025 suggests these were non-recurring items. Overall, the financial performance indicates a company with strong revenue growth and a commitment to research and development, though subject to potential volatility from large, infrequent charges.

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Vertex Pharmaceuticals Inc. (NASDAQ:VRTX)

Income Statement