Shares of Novo Nordisk (NVO) are down 2% after the European pharmaceutical company lowered its forward guidance concerning its operating profit.
Novo Nordisk, which is based in Denmark, said it had a net profit of 20.05 billion Danish kroner ($2.93 billion U.S.) in this year’s second quarter.
That result was below a profit of 20.90 billion Danish kroner ($3.06 billion U.S.) expected among analysts.
Along with the profit miss, Novo Nordisk lowered its full-year operating profit outlook, saying it now expects growth of 20% to 28%, rather than the 22% to 30% that was previously forecast.
However, sales of the company’s popular weight loss drug Wegovy increased 55% year-over-year in the second quarter, coming in at 11.66 billion kroner ($1.71 billion U.S.).
As a result, Novo Nordisk raised its sales forecast for this year, saying it anticipates 22% to 28% revenue growth for all of 2024. That’s up from a prior forecast of 19% to 27% growth.
Novo Nordisk faces rising competition in the red-hot weight loss category, especially from rival Eli Lilly (LLY) which also has an obesity medication available globally.
On an earnings call, management at Novo Nordisk said they remain confident in their ability to ramp-up production of the Wegovy weight loss drug and “sustain competitiveness long term.”
Wegovy was approved for use in China this June, opening a potentially huge new market for the medication in the nation of 1.4 billion people.
More recently, regulators in the U.K. and European Union approved Wegovy as a treatment for heart disease in overweight and obese adults.
Before today, the stock of Novo Nordisk had risen 61% over the last 12 months and was trading at $130.12 U.S. per share.
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