Analysis of Profitability Ratios
Profitability ratios measure the company ability to generate profitable sales from its resources (assets).
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- Balance Sheet: Assets
- Analysis of Short-term (Operating) Activity Ratios
- DuPont Analysis: Disaggregation of ROE, ROA, and Net Profit Margin
- Analysis of Geographic Areas
- Enterprise Value to EBITDA (EV/EBITDA)
- Price to FCFE (P/FCFE)
- Debt to Equity since 2005
- Total Asset Turnover since 2005
- Price to Earnings (P/E) since 2005
- Analysis of Debt
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Profitability Ratios (Summary)
Pfizer Inc., profitability ratios
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 profitability metrics demonstrate a period of initial improvement followed by a significant decline and subsequent partial recovery. A notable fluctuation is observed across all reported ratios between 2021 and 2025.
- Gross Profit Margin
- The gross profit margin exhibited an increasing trend initially, rising from 62.48% in 2021 to a peak of 74.33% in 2025. A substantial increase occurred between 2022 (66.05%) and 2024 (71.94%), suggesting improved cost management or pricing strategies. However, there was a dip to 58.10% in 2023 before the final increase.
- Operating Profit Margin
- The operating profit margin followed a different trajectory. It increased significantly from 24.70% in 2021 to 35.37% in 2022, but then experienced a dramatic decrease to 2.15% in 2023. A recovery was then seen in 2024 (19.51%) and 2025 (22.76%), though it did not return to the levels observed in 2022. This suggests a significant impact on operating expenses or sales mix in 2023.
- Net Profit Margin
- The net profit margin mirrored the trend of the operating profit margin, increasing from 26.76% in 2021 to 31.01% in 2022, then falling sharply to 3.56% in 2023. Subsequent years showed improvement, reaching 12.62% in 2024 and 12.42% in 2025, but remained considerably lower than the 2021 and 2022 figures.
- Return on Equity (ROE)
- Return on equity demonstrated a similar pattern of initial growth followed by a substantial decline. It peaked at 32.79% in 2022 before plummeting to 2.38% in 2023. A modest recovery occurred in 2024 (9.11%) and 2025 (8.99%), but remained significantly below prior levels. This indicates a considerable reduction in profitability relative to shareholder equity.
- Return on Assets (ROA)
- The return on assets exhibited a comparable trend to ROE and the profit margins. It rose from 12.11% in 2021 to 15.91% in 2022, then fell drastically to 0.94% in 2023. A slight recovery was observed in 2024 (3.76%) and 2025 (3.73%), but remained substantially lower than earlier values. This suggests a reduced ability to generate earnings from its asset base.
The year 2023 appears to be a critical turning point, with all profitability ratios experiencing a significant downturn. While a partial recovery is evident in 2024 and 2025, the metrics have not returned to their previous levels. Further investigation is warranted to understand the factors contributing to the 2023 decline and the sustainability of the subsequent recovery.
Return on Sales
Return on Investment
Gross Profit Margin
Pfizer Inc., gross profit margin calculation, comparison to benchmarks
| Dec 31, 2025 | Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Gross profit | ||||||
| Revenues | ||||||
| Profitability Ratio | ||||||
| Gross profit margin1 | ||||||
| Benchmarks | ||||||
| Gross Profit Margin, Competitors2 | ||||||
| AbbVie Inc. | ||||||
| Amgen Inc. | ||||||
| Bristol-Myers Squibb Co. | ||||||
| Danaher Corp. | ||||||
| Eli Lilly & Co. | ||||||
| Gilead Sciences Inc. | ||||||
| Johnson & Johnson | ||||||
| Merck & Co. Inc. | ||||||
| Regeneron Pharmaceuticals Inc. | ||||||
| Thermo Fisher Scientific Inc. | ||||||
| Vertex Pharmaceuticals Inc. | ||||||
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).
1 2025 Calculation
Gross profit margin = 100 × Gross profit ÷ Revenues
= 100 × ÷ =
2 Click competitor name to see calculations.
The gross profit margin exhibited considerable fluctuation over the five-year period. Initial values demonstrated growth, followed by a significant decline, and then a period of recovery.
- Gross Profit
- Gross profit increased from US$51.324 billion in 2021 to US$66.831 billion in 2022, representing substantial growth. However, a marked decrease occurred in 2023, with gross profit falling to US$34.599 billion. A partial recovery was observed in 2024, reaching US$45.776 billion, and continued modestly into 2025 at US$46.512 billion.
- Revenues
- Revenues mirrored the trend in gross profit, increasing from US$82.145 billion in 2021 to US$101.175 billion in 2022. A substantial decline followed in 2023, with revenues decreasing to US$59.553 billion. Revenues experienced a smaller increase in 2024 to US$63.627 billion, and remained relatively stable in 2025 at US$62.579 billion.
- Gross Profit Margin
- The gross profit margin began at 62.48% in 2021 and increased to 66.05% in 2022. A decline was then observed in 2023, with the margin falling to 58.10%. A significant increase occurred in 2024, reaching 71.94%, and continued to rise in 2025, reaching 74.33%. This indicates an improving ability to control the cost of goods sold relative to revenue in the later years of the period.
The substantial increase in gross profit margin from 2023 to 2025, despite relatively stable revenue, suggests improved operational efficiency or a shift in product mix towards higher-margin offerings. The initial growth in both gross profit and revenue in 2022 was followed by a significant contraction in 2023, requiring further investigation to understand the underlying causes.
Operating Profit Margin
Pfizer Inc., operating profit margin calculation, comparison to benchmarks
| Dec 31, 2025 | Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Operating income | ||||||
| Revenues | ||||||
| Profitability Ratio | ||||||
| Operating profit margin1 | ||||||
| Benchmarks | ||||||
| Operating Profit Margin, Competitors2 | ||||||
| AbbVie Inc. | ||||||
| Amgen Inc. | ||||||
| Bristol-Myers Squibb Co. | ||||||
| Danaher Corp. | ||||||
| Eli Lilly & Co. | ||||||
| Gilead Sciences Inc. | ||||||
| Johnson & Johnson | ||||||
| Merck & Co. Inc. | ||||||
| Regeneron Pharmaceuticals Inc. | ||||||
| Thermo Fisher Scientific Inc. | ||||||
| Vertex Pharmaceuticals Inc. | ||||||
| Operating Profit Margin, Sector | ||||||
| Pharmaceuticals, Biotechnology & Life Sciences | ||||||
| Operating Profit Margin, Industry | ||||||
| Health Care | ||||||
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).
1 2025 Calculation
Operating profit margin = 100 × Operating income ÷ Revenues
= 100 × ÷ =
2 Click competitor name to see calculations.
The operating profit margin exhibited significant fluctuations over the five-year period. Initial values were strong, followed by a substantial decline and subsequent recovery.
- Operating Profit Margin - Overall Trend
- The operating profit margin began at 24.70% in 2021, increasing substantially to 35.37% in 2022. A dramatic decrease was then observed in 2023, falling to 2.15%. The margin partially recovered in 2024, reaching 19.51%, and continued to improve in 2025, closing at 22.76%.
The substantial increase in the operating profit margin from 2021 to 2022 suggests improved operational efficiency or a favorable shift in revenue mix. However, the precipitous drop in 2023 indicates a significant challenge to profitability, potentially stemming from increased costs, decreased revenues, or a combination of both. The subsequent increases in 2024 and 2025 suggest corrective actions were taken or external conditions improved, but the margin did not return to the levels seen in 2021 and 2022.
- Relationship to Operating Income and Revenues
- The operating profit margin’s movements correlate with changes in both operating income and revenues. The peak margin in 2022 coincided with the highest reported operating income and revenues. The low margin in 2023 occurred alongside a significant reduction in both operating income and revenues. While revenues showed some recovery in 2024 and 2025, operating income’s growth was more pronounced, contributing to the margin improvement.
The volatility in the operating profit margin warrants further investigation to understand the underlying drivers of these changes. A detailed analysis of cost structures, revenue streams, and competitive pressures would be necessary to fully assess the sustainability of the recent recovery and potential risks to future profitability.
Net Profit Margin
Pfizer Inc., net profit margin calculation, comparison to benchmarks
| Dec 31, 2025 | Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Net income attributable to Pfizer Inc. common shareholders | ||||||
| Revenues | ||||||
| Profitability Ratio | ||||||
| Net profit margin1 | ||||||
| Benchmarks | ||||||
| Net Profit Margin, Competitors2 | ||||||
| AbbVie Inc. | ||||||
| Amgen Inc. | ||||||
| Bristol-Myers Squibb Co. | ||||||
| Danaher Corp. | ||||||
| Eli Lilly & Co. | ||||||
| Gilead Sciences Inc. | ||||||
| Johnson & Johnson | ||||||
| Merck & Co. Inc. | ||||||
| Regeneron Pharmaceuticals Inc. | ||||||
| Thermo Fisher Scientific Inc. | ||||||
| Vertex Pharmaceuticals Inc. | ||||||
| Net Profit Margin, Sector | ||||||
| Pharmaceuticals, Biotechnology & Life Sciences | ||||||
| Net Profit Margin, Industry | ||||||
| Health Care | ||||||
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).
1 2025 Calculation
Net profit margin = 100 × Net income attributable to Pfizer Inc. common shareholders ÷ Revenues
= 100 × ÷ =
2 Click competitor name to see calculations.
The net profit margin exhibited significant fluctuations over the five-year period. Initial values were strong, followed by a substantial decline and subsequent partial recovery.
- Overall Trend
- The net profit margin began at 26.76% in 2021, increased to a peak of 31.01% in 2022, then experienced a dramatic decrease to 3.56% in 2023. A recovery was observed in 2024 and 2025, with margins reaching 12.62% and 12.42% respectively, though remaining considerably below the levels seen in the earlier years.
- 2021-2022 Performance
- From 2021 to 2022, the net profit margin increased by 4.25 percentage points. This improvement coincided with a rise in revenues, and a larger increase in net income attributable to Pfizer Inc. common shareholders, suggesting enhanced profitability during this period.
- 2022-2023 Decline
- The period from 2022 to 2023 witnessed a precipitous drop in the net profit margin, decreasing by 27.45 percentage points. This decline occurred alongside a significant reduction in revenues and a substantial decrease in net income. The magnitude of the decline in net income far exceeded the reduction in revenues, indicating a considerable loss of profitability.
- 2023-2025 Recovery
- Between 2023 and 2025, the net profit margin showed a recovery, increasing by 9.06 percentage points overall. While revenues remained relatively stable, the increase in net income attributable to Pfizer Inc. common shareholders drove the improvement in the margin. However, the margin in 2025 remained approximately 50% below the 2021 and 2022 levels.
The volatility in the net profit margin suggests sensitivity to changes in either revenue or net income, or both. The substantial decline in 2023 warrants further investigation to understand the underlying factors contributing to the reduced profitability.
Return on Equity (ROE)
Pfizer Inc., ROE calculation, comparison to benchmarks
| Dec 31, 2025 | Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Net income attributable to Pfizer Inc. common shareholders | ||||||
| Total Pfizer Inc. shareholders’ equity | ||||||
| Profitability Ratio | ||||||
| ROE1 | ||||||
| Benchmarks | ||||||
| ROE, Competitors2 | ||||||
| AbbVie Inc. | ||||||
| Amgen Inc. | ||||||
| Bristol-Myers Squibb Co. | ||||||
| Danaher Corp. | ||||||
| Eli Lilly & Co. | ||||||
| Gilead Sciences Inc. | ||||||
| Johnson & Johnson | ||||||
| Merck & Co. Inc. | ||||||
| Regeneron Pharmaceuticals Inc. | ||||||
| Thermo Fisher Scientific Inc. | ||||||
| Vertex Pharmaceuticals Inc. | ||||||
| ROE, Sector | ||||||
| Pharmaceuticals, Biotechnology & Life Sciences | ||||||
| ROE, Industry | ||||||
| Health Care | ||||||
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).
1 2025 Calculation
ROE = 100 × Net income attributable to Pfizer Inc. common shareholders ÷ Total Pfizer Inc. shareholders’ equity
= 100 × ÷ =
2 Click competitor name to see calculations.
The Return on Equity (ROE) exhibited significant fluctuations over the five-year period. Initial values were strong, followed by a substantial decline and a subsequent partial recovery. Net income attributable to Pfizer Inc. common shareholders and total Pfizer Inc. shareholders’ equity both influenced these changes.
- ROE Trend
- ROE began at 28.47% in 2021, increasing to a peak of 32.79% in 2022. A dramatic decrease was then observed in 2023, with ROE falling to 2.38%. A partial recovery occurred in 2024 and 2025, with ROE reaching 9.11% and 8.99% respectively. This suggests a period of exceptionally high profitability followed by a significant downturn and a stabilization at a lower, but still positive, level.
- Net Income Impact
- Net income attributable to Pfizer Inc. common shareholders rose considerably from US$21,979 million in 2021 to US$31,372 million in 2022, contributing to the increase in ROE during that period. However, net income then plummeted to US$2,119 million in 2023, directly causing the sharp decline in ROE. While net income increased in 2024 and 2025 to US$8,031 million and US$7,771 million respectively, it did not return to the levels seen in 2021 and 2022.
- Shareholders’ Equity Impact
- Total Pfizer Inc. shareholders’ equity increased from US$77,201 million in 2021 to US$95,661 million in 2022. It then decreased to US$89,014 million in 2023, and continued to decline modestly to US$88,203 million in 2024 and US$86,476 million in 2025. The increase in equity from 2021 to 2022 partially offset the impact of rising net income on ROE, while the subsequent decreases in equity from 2023 to 2025 likely exacerbated the effect of lower net income on ROE.
The combined effect of fluctuating net income and shareholders’ equity resulted in the observed ROE pattern. The substantial decline in net income in 2023 was the primary driver of the significant decrease in ROE that year, despite a concurrent decrease in shareholders’ equity. The relatively stable ROE values in 2024 and 2025 suggest a potential stabilization of profitability, albeit at a lower level than previously experienced.
Return on Assets (ROA)
Pfizer Inc., ROA calculation, comparison to benchmarks
| Dec 31, 2025 | Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Net income attributable to Pfizer Inc. common shareholders | ||||||
| Total assets | ||||||
| Profitability Ratio | ||||||
| ROA1 | ||||||
| Benchmarks | ||||||
| ROA, Competitors2 | ||||||
| AbbVie Inc. | ||||||
| Amgen Inc. | ||||||
| Bristol-Myers Squibb Co. | ||||||
| Danaher Corp. | ||||||
| Eli Lilly & Co. | ||||||
| Gilead Sciences Inc. | ||||||
| Johnson & Johnson | ||||||
| Merck & Co. Inc. | ||||||
| Regeneron Pharmaceuticals Inc. | ||||||
| Thermo Fisher Scientific Inc. | ||||||
| Vertex Pharmaceuticals Inc. | ||||||
| ROA, Sector | ||||||
| Pharmaceuticals, Biotechnology & Life Sciences | ||||||
| ROA, Industry | ||||||
| Health Care | ||||||
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).
1 2025 Calculation
ROA = 100 × Net income attributable to Pfizer Inc. common shareholders ÷ Total assets
= 100 × ÷ =
2 Click competitor name to see calculations.
The Return on Assets (ROA) exhibited significant fluctuations over the observed period. Initially, the ROA demonstrated a positive trend, followed by a substantial decline and subsequent stabilization at a lower level.
- Overall Trend
- The ROA increased from 12.11% in 2021 to a peak of 15.91% in 2022. This was followed by a dramatic decrease to 0.94% in 2023. The ROA then experienced a partial recovery, reaching 3.76% in 2024 and remaining relatively stable at 3.73% in 2025.
- Net Income Impact
- The increase in ROA from 2021 to 2022 aligns with a corresponding increase in net income attributable to Pfizer Inc. common shareholders, rising from US$21,979 million to US$31,372 million. However, the sharp decline in ROA in 2023 coincides with a significant reduction in net income to US$2,119 million. The subsequent modest increases in net income in 2024 and 2025 (US$8,031 million and US$7,771 million respectively) correlate with the stabilization of the ROA.
- Asset Base Consideration
- Total assets increased from US$181,476 million in 2021 to US$226,501 million in 2023. While the asset base grew, the substantial decrease in net income in 2023 resulted in a disproportionately low ROA. The subsequent decrease in total assets in 2024 and 2025 (US$213,396 million and US$208,160 million respectively) did not lead to a significant ROA improvement, indicating that net income generation remained the primary driver of the ratio’s performance.
The observed pattern suggests a strong relationship between profitability and asset utilization. The company’s ability to generate earnings from its asset base was considerably impacted by fluctuations in net income, overshadowing the changes in the total asset value.