GSK reports strong Q1, strategizes for potential U.S. tariffs

UK – GlaxoSmithKline (GSK) has reported stronger-than-expected first-quarter results and expressed confidence in its ability to manage potential U.S. pharmaceutical tariffs.

The British drugmaker cited artificial intelligence (AI) initiatives and supply chain adjustments as key strategies to mitigate the impact of proposed trade measures.

In the first quarter of 2025, GSK achieved a turnover of £7.52 billion (US $10.04 billion) and a core profit of 44.9 pence per share, slightly surpassing analysts’ expectations of £7.42 billion (US $9.9 billion) and 40.9 pence per share, respectively.

Shares rose 2.4%, making GSK one of the top gainers on London’s FTSE 100 index. ​

This performance was bolstered by a 17% year-over-year increase in specialty medicines revenue, particularly in oncology, which offset a 6% decline in vaccine sales.

Preparing for potential tariffs

Amid concerns over proposed U.S. tariffs on pharmaceuticals, GSK stated it is “well positioned” to absorb any potential financial impacts.

The company has implemented AI-driven cost-cutting measures and established dual sourcing for its medicines to enhance supply chain resilience.

CEO Emma Walmsley highlighted that these strategies, developed during the 2022 demerger of Haleon, have prepared GSK to navigate the evolving trade landscape.

GSK has also invested in U.S. manufacturing, including a US $800 million facility in Pennsylvania, to bolster regional production capabilities and reduce reliance on global supply chains.

Focus on specialty medicines

GSK continues to prioritize the expansion of its specialty medicines portfolio, particularly in oncology and infectious diseases, to offset declining sales from older products and upcoming patent expirations in its HIV portfolio.

The company is also investing in research and development to support future growth, with several new product launches anticipated in the coming years.

While vaccine sales declined in the first quarter, GSK remains optimistic about the long-term prospects of its vaccine portfolio.

The company is addressing challenges related to its RSV vaccine, Arexvy, and shingles vaccine, Shingrix, and is exploring strategies to enhance their market performance.

Shareholder returns

GSK has initiated a £2 billion (US $2.67 billion) share buyback program, with £273 million (US $364.35 million) repurchased to date, and declared a 16p dividend for the first quarter.

The company maintains its 2025 guidance of 3-5% turnover growth and a 6-8% increase in core earnings per share, reflecting confidence in its strategic direction and financial stability.