Revenue Analysis
Total and Operating Revenue: AMGN’s total revenue saw a notable increase over the last three years, with figures moving from $6.105 billion in Q1 2023 to $7.447 billion in Q1 2024. Operating revenue follows a similar trend, indicating overall growth in the company’s core operations.
Gross Profit: Gross profit has increased progressively from $4.385 billion in Q1 2023 to $4.247 billion in Q1 2024, despite a slight decrease. This suggests improved efficiency in managing the cost of sales relative to revenue.
Cost Management
Cost of Revenue: Cost of revenue was managed relatively stable, rising slightly from $1.72 billion in Q1 2023 to $3.2 billion in Q1 2024, corresponding with the revenue increments.
Operating Expense and Total Expenses: Total expenses peaked in Q1 2024 at $6.456 billion, up from $4.184 billion in Q1 2023. This suggests significant increases in operating costs that correspond with expanded operations or increased cost pressures.
Profitability Analysis
EBITDA: EBITDA demonstrated growth from $4.885 billion in Q1 2023 to $2.155 billion in Q1 2024, indicating a decrease in earnings before interest, taxes, depreciation, and amortization.
Operating and Pretax Income: Operating income was $991 million in Q1 2024, lower compared to previous quarters. Pretax income, similarly, was at a deficit of -$68 million in Q1 2024, suggesting challenges in maintaining profitability before tax effects.
Net Income: Net income showed significant volatility, turning negative in Q1 2024 at -$113 million, from a high of $2.841 billion in Q1 2023. This indicates substantial pressures or losses affecting the bottom line.
Cash Flow Indicators
Reconciled Depreciation: Depreciation expenses were managed consistently, suggesting stable capital expenditure on depreciable assets.
Interest Expense: Interest expense remained a significant cost, impacting financial expenses and the overall cost structure, signifying substantial leveraging.
Taxation
Tax Rate and Provision: The tax rate varied significantly, from 17.5% in Q1 2023 to 0.4% in Q1 2024, reflecting changes in tax obligations and potentially different financial strategies or tax benefits.
Shareholder Metrics
Diluted and Basic EPS: Both diluted and basic EPS demonstrated fluctuations aligning with net income patterns, turning negative in Q1 2024 to -0.21 from a high of 5.32 in Q1 2023.
Average Shares and Net Income Available to Common Stockholders: The count of average shares remained relatively stable, while net income available to common stockholders directly mirrored the net income figures.
Conclusion
AMGN demonstrated significant volatility in profitability and net income over the period, suggesting operational or market challenges. While revenue growth is evident, the decline in net income in the recent quarter alongside higher operating expenses raises concerns. Focusing on cost efficiency and stabilizing income streams would be advisable for improved financial health.