The quarter itself was roughly in line, not a clean beat. Adjusted diluted EPS was $1.87 versus published expectations around $1.85–$1.88, while revenue of $2.468 billion was slightly below consensus near $2.49 billion.
| Metric | Q2 2026 | Q2 2025 | Change | External expectation |
|---|---|---|---|---|
| Revenue | $2.468B | $2.474B | Flat; (1)% organic operational | ~$2.49B–$2.52B |
| Adjusted diluted EPS | $1.87 | $1.78 | 5% reported; 4% organic operational | ~$1.85–$1.88 |
| GAAP diluted EPS | $1.65 | $1.63 | 1% | — |
| Adjusted net income | $781M | $791M | (1)% reported; (2)% organic operational | — |
| Full-year revenue guidance | $9.12B–$9.32B | Prior: $9.68B–$9.96B | Cut by $560M at the midpoint | — |
| Full-year adjusted diluted EPS guidance | $6.15–$6.25 | Prior: $6.85–$7.00 | Cut by $0.73 at the midpoint | — |
The decisive news is the full-year reset, not the quarterly EPS. Zoetis cut its 2026 revenue outlook by roughly 6% at the midpoint and adjusted EPS guidance by roughly 11%, while shifting expected organic operational performance from 2%–5% growth to a 3%–1% decline. The filing also raises expected significant items and acquisition-related costs from approximately $100 million to $150 million. (Full-Year 2026 Guidance)
U.S. companion-animal weakness is broader and more persistent than the prior outlook assumed. U.S. revenue fell 7% organically, with companion-animal sales down 11%; management cited lower clinic visits, pet-owner price sensitivity, competition in dermatology and Simparica Trio, generic pressure on Cerenia and Convenia, and lower Librela sales. U.S. earnings declined 10%, and gross margin fell to 83.1% from 84.7%. (Revenue by Segment and Species; Segment Earnings)
International and livestock provide real offsets, but not enough to repair the core problem. International revenue grew 6% organically and livestock revenue grew 11% organically, led by cattle and poultry. Those gains were outweighed by a 6% organic decline in companion-animal revenue globally and the 7% organic decline in the U.S. business. (Revenue by Segment and Species)
Net read: materially worse than the market’s standing expectation despite a near-consensus quarter. The current period shows cost control and strong livestock/international execution, but the sharply reduced full-year targets indicate management now expects the U.S. companion-animal slowdown to persist. That guidance cut substantially outweighs the small quarterly EPS-versus-consensus advantage. (Full-Year 2026 Guidance; Segment Earnings)
Read the original 8-K on SEC EDGAR ↗