Quarterly earnings results are a good time to check in on a company’s progress, especially compared to its peers in the same sector. Today we are looking at Elanco (NYSE: ELAN) and the best and worst performers in the pharmaceuticals industry.

The pharmaceuticals sector develops, manufactures, and distributes drugs, benefiting from diversified portfolios of branded and generic medications. Looking ahead, growth will be driven by innovations in precision medicine, such as genetic therapies and advanced biologics, and the increasing use of AI to speed and increase the efficiency of drug discovery. These could specifically magnify the advantages of the most scaled players. Conversely, the sector faces considerable headwinds from intense, bipartisan political pressure on drug pricing, scrutiny of patent practices, and growing competition from biosimilars. These could specifically stymie the growth of smaller companies or ones facing patent expirations on key drugs.

The 16 pharmaceuticals stocks we track reported a very strong Q2. As a group, revenues beat analysts’ consensus estimates by 5.5% while next quarter’s revenue guidance was 1.5% above.

In light of this news, share prices of the companies have held steady. On average, they are relatively unchanged since the latest earnings results.

Elanco (NYSE: ELAN)

Originally established as a division of pharmaceutical giant Eli Lilly before becoming independent in 2018, Elanco Animal Health (NYSE: ELAN) develops and sells medications, vaccines, and other health products for pets and farm animals across more than 90 countries.

Elanco reported revenues of $1.37 billion, up 10.2% year on year. This print exceeded analysts’ expectations by 4.2%. Overall, it was an exceptional quarter for the company with a beat of analysts’ EPS estimates and an impressive beat of analysts’ EPS guidance for next quarter estimates.

"Elanco's second quarter results demonstrate our momentum and leadership in the attractive animal health industry," stated Jeff Simmons, President and CEO of Elanco.

Investor expectations, however, were likely higher than Wall Street’s published projections, leaving some wishing for even better results (analysts’ consensus estimates are those published by big banks and advisory firms, not the investors who make buy and sell decisions). The stock is down 14.1% since reporting and currently trades at $22.

Is now the time to buy Elanco? Access our full analysis of the earnings results here, it’s free.

Best Q2: Bristol-Myers Squibb (NYSE: BMY)

With roots dating back to 1887 and a transformative merger in 1989 that gave the company its current name, Bristol-Myers Squibb (NYSE: BMY) discovers, develops, and markets prescription medications for serious diseases including cancer, blood disorders, immunological conditions, and cardiovascular diseases.

Bristol-Myers Squibb reported revenues of $12.97 billion, up 5.7% year on year, outperforming analysts’ expectations by 12.9%. The business had an incredible quarter with a beat of analysts’ EPS estimates and an impressive beat of analysts’ full-year EPS guidance estimates.

Although it had a fine quarter compared to its peers, the market seems unhappy with the results as the stock is down 10% since reporting. It currently trades at $56.79.

Is now the time to buy Bristol-Myers Squibb? Access our full analysis of the earnings results here, it’s free.

Weakest Q2: Zoetis (NYSE: ZTS)

Originally spun off from Pfizer in 2013 as the world's largest pure-play animal health company, Zoetis (NYSE: ZTS) discovers, develops, and sells medicines, vaccines, diagnostic products, and services for pets and livestock animals worldwide.

Zoetis reported revenues of $2.47 billion, flat year on year, falling short of analysts’ expectations by 1.5%. It was a disappointing quarter as it posted full-year revenue guidance missing analysts’ expectations significantly and a significant miss of analysts’ full-year EPS guidance estimates.

Zoetis delivered the weakest performance against analyst estimates, slowest revenue growth, and weakest full-year guidance update among its peers. The stock is flat since the results and currently trades at $74.87.

Read our full analysis of Zoetis’s results here.

Merck (NYSE: MRK)

With roots dating back to 1891 and a portfolio that includes the blockbuster cancer immunotherapy Keytruda, Merck (NYSE: MRK) develops and sells prescription medicines, vaccines, and animal health products across oncology, infectious diseases, cardiovascular, and other therapeutic areas.

Merck reported revenues of $16.61 billion, up 5.1% year on year. This result surpassed analysts’ expectations by 2.1%. More broadly, it was a satisfactory quarter as it also produced a beat of analysts’ EPS estimates but a miss of analysts’ full-year EPS guidance estimates.

The stock is up 11.3% since reporting and currently trades at $142.18.

Read our full, actionable report on Merck here, it’s free.

ANI Pharmaceuticals (NASDAQ: ANIP)

With a diverse portfolio of 116 pharmaceutical products and a growing rare disease platform, ANI Pharmaceuticals (NASDAQ: ANIP) develops, manufactures, and markets branded and generic prescription pharmaceuticals, with a focus on rare disease treatments.

ANI Pharmaceuticals reported revenues of $266 million, up 25.9% year on year. This number topped analysts’ expectations by 2.4%. Aside from that, it was a mixed quarter as it also recorded a beat of analysts’ EPS estimates but full-year revenue guidance slightly missing analysts’ expectations.

The stock is down 12% since reporting and currently trades at $72.67.

Read our full, actionable report on ANI Pharmaceuticals here, it’s free.

Market Update

Over the past year, investors have been forced to repeatedly answer the same question: what is the market’s biggest risk? The answer has changed several times, and each shift has reshaped market leadership.

Late in 2025 and early 2026, artificial intelligence became the market’s primary uncertainty. Investors questioned whether AI would erode software pricing power and weaken competitive moats as AI made it easier to replicate once-differentiated products.

By the spring, technology took a back seat to geopolitics. The U.S. conflict with Iran briefly became the market’s dominant narrative, raising concerns about oil prices, inflation, and global growth. But as energy markets remained orderly and fears of a prolonged supply disruption faded, investors quickly turned their focus back to fundamentals.

Want to invest in winners with rock-solid fundamentals? Check out our Top 5 Growth Stocks and add them to your watchlist. These companies are poised for growth regardless of the political or macroeconomic climate.