Bayer raises 2026 earnings guidance as Nubeqa and Kerendia lift pharma; shares jump 5.6%

Bayer (BAYRY), the German pharmaceutical and agricultural group, raised its full-year 2026 earnings guidance on 3 November, and its shares rose 5.6% in European morning trading. The company credited a recovery in its pharmaceuticals business, which offset pressure at its agricultural and consumer-health divisions.

The move matters because it comes from the division at the center of Bayer's turnaround, after patent expirations weighed on results, and it adds to gains that have roughly doubled the stock's value over the past year. Bayer also tightened its net debt forecast, a central issue as the group works to reduce its debt pile.

What happened

Bayer now expects full-year earnings before interest, taxes, depreciation and amortization of 9.8 billion to 10.3 billion euros, excluding currency effects and exceptional items. It had previously forecast 9.6 billion to 10.1 billion euros.

The company also upgraded its outlook for cash flow and net debt. It now expects to end the year with net debt of 28 billion to 29 billion euros, against a previous range of 29 billion to 30 billion euros, as it expects to burn less cash than earlier forecast.

For the pharma business, Bayer now expects an adjusted EBITDA margin of 25% to 27% for 2026 as a whole, up from a prior forecast of 23% to 25%. Higher profitability expectations for pharma prompted the revision to group guidance.

What were the third-quarter numbers?

• Group sales: 10.05 billion euros, up 4.1% on year, against consensus of 9.93 billion euros compiled by Vara Research.
• EBITDA excluding exceptional items: up 6.9% to 1.615 billion euros, against consensus of 1.4 billion euros.
• Net loss: narrowed to 672 million euros from 963 million euros a year earlier, after impairment charges and litigation expenses.
• Pharma sales: up 6.4% excluding currency and portfolio changes.
• Pharma adjusted EBITDA: up 24% to 1.29 billion euros.

What drove the pharma recovery?

Bayer's pharma growth was driven by two drugs: prostate-cancer treatment Nubeqa and kidney and heart medicine Kerendia. Sales of Nubeqa rose 58% and sales of Kerendia rose 65% in the quarter, according to the company, and both fueled higher profitability.

The division had been under strain after patent expirations for blood thinner Xarelto and eye medicine Eylea weighed on results. Chief Executive Bill Anderson framed the quarter as a turning point.

"We've reached a turning point in pharma's growth trajectory and we're beginning to see the other side."

Bill Anderson, Bayer Chief Executive, in the company's third-quarter results announcement on 3 November.

How did markets react?

Bayer shares were up 5.6% in European morning trading on 3 November. The stock has roughly doubled in value over the past year, so the move extends a strong run.

The reaction contrasts with the start of the year. On 4 March 2026, Bayer issued a 2026 earnings target range below market expectations, and the shares dropped 3.8%. Earlier still, shares had sunk to a 20-year low after a 2025 earnings fall. The latest quarter's EBITDA beat of 1.615 billion euros against 1.4 billion euros expected helps explain the change in tone.

Market data for Bayer's American depositary receipts show a trailing price-to-earnings ratio of -29.53 and a forward ratio of 11.38. That data reflects the latest reported quarter in its own reporting basis, in which earnings per share of 0.09 compared with an estimate of 0.13.

Why it matters

Bayer's raised outlook shows that pharma, rather than agriculture, is now carrying the group's earnings revision. That matters because the company has been trying to move past U.S. legal battles over its Roundup weedkiller while reducing debt.

The net debt forecast of 28 billion to 29 billion euros is a full billion lower at both ends of the range than the previous target. The upgrade comes from lower expected cash burn, a sign that the financial position is improving alongside earnings.

What are the risks and counterpoints?

The quarter was not free of drag. Bayer still booked a net loss of 672 million euros, hit by impairment charges and litigation expenses. Agricultural and consumer-health divisions continue to face market pressures, which the pharma recovery only offset.

The Roundup legal issue remains part of the backdrop, and the company's improvement in pharma depends heavily on two products. Nubeqa and Kerendia are growing at rates of 58% and 65%, while the overall pharma division grew 6.4%, which shows how much of the growth rests on them.

What to watch next

The Sources name no dated catalysts beyond the results themselves, but several indicators will determine whether the improvement holds.

• Whether pharma delivers the adjusted EBITDA margin of 25% to 27% that Bayer now expects for 2026.
• Whether net debt ends the year within the 28 billion to 29 billion euros range.
• Further data on Nubeqa, which Bayer has said it will present at ESMO 2026.
• The effect of impairment charges and litigation expenses on the net result in coming quarters.
• The performance of the agricultural and consumer-health divisions under market pressure.

Bayer's full-year EBITDA guidance of 9.8 billion to 10.3 billion euros will be the benchmark for the final quarter of 2026.