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Why Merck (MRK) Is Plunging Today

Merck (MRK) stock is sinking 10% after the company provided weaker-than-expected 2025 guidance amid weak sales of Gardasil, its HPV vaccine.

Additionally, the huge drug maker withdrew its long-term guidance for Gardasil’s sales, while the revenue of its diabetes drugs plunged in the fourth quarter.

A laboratory setting with researchers working to develop the company’s immuno-therapies.

Merck’s Guidance Miss and Gardasil Woes

MRK provided 2025 adjusted EPS guidance of $8.88 to $9.03, while the giant drugmaker expects sales of $64.1 billion to $65.6 billion. Analysts, on average, had expected the company to generate EPS of $9.13 and sales of $67 billion in 2025.

Weakening Gardasil demand may be a key reason for the guidance miss. Last quarter, the revenue generated by the vaccine sank 17% versus Q4 of 2023 to $1.55 billion amid lower demand for the shot in China.

And indicating that the issues with Gardasil could continue, MRK withdrew its previous long-term guidance for the shot which had called for its annual sales to surge to $11 billion by 2030.

Moreover, the revenue generated by the company’s diabetes drugs, Januvia and Janumet, plunged 38% year-over-year last quarter to $487 million.

What Went Right for MRK 

On a positive note, the company reported Q4 EPS, excluding some items, of $1.72, well above analysts’ average estimate of $1.01.

The results were boosted by the continued success of anti-cancer drug Keytruda whose sales surged 19% YOY to $7.8 billion.

While we acknowledge the potential of MRK, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns, and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than MRK but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.

READ ALSO 8 Best Wide Moat Stocks to Buy Now and 30 Most Important AI Stocks According to BlackRock

Disclosure: None. This article is originally published at Insider Monkey.

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Fast forward a year and Amazon’s new CEO Andy Jassy described generative AI as a “once-in-a-lifetime” technology that is already being used across Amazon to reinvent customer experiences.

At the 8th Future Investment Initiative conference, Elon Musk predicted that by 2040 there would be at least 10 billion humanoid robots, with each priced between $20,000 and $25,000.

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  • 140 Metas
  • 84 Googles
  • 65 Microsofts
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  • Bill Gates sees artificial intelligence as the “biggest technological advance in my lifetime,” more transformative than the internet or personal computer, capable of improving healthcare, education, and addressing climate change.
  • Larry Ellison — through Oracle, is spending billions on Nvidia chips and partnering with Cohere to embed generative AI across Oracle’s cloud and apps.
  • Warren Buffett — not known for tech hype — says this breakthrough could have a ‘hugely beneficial social impact.

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