“While there will always be some quarterly variability, recent results demonstrate a consistent trend of our operating margin firmly in the 40% plus range, and we remain focused on being an industry leader in terms of operating margin.”

In context

“es, such as the wind-down of the magrolimab program and the obeldesivir oral COVID studies, and supported by our broader expense management initiatives. Acquired IPR&D was $505 million, which reflects the $320 million buyout of global Livdelzi royalties from Janssen announced in August, and the $35 million upfront expense to initiate a new AI partnership with Genesis, in addition to ongoing collaboration expenses. SG&A was up 8% year-over-year, primarily due to timing of commercial and corporate activities, including the launch of Livdelzi in the United States, and other initiatives, including prelaunch preparations for Lenacapavir for PrEP. Operating margin for the third quarter was 43%. Excluding the impact of the royalty buyout charge from Janssen, operating margin would have been 47%. While there will always be some quarterly variability, recent results demonstrate a consistent trend of our operating margin firmly in the 40% plus range, and we remain focused on being an industry leader in terms of operating margin. Our effective tax rate was approximately 18%, as compared to 7% in the same period last year. As a reminder, the tax rate in the third quarter of 2023 benefited from decreased tax reserves as a result of reaching an agreement with a tax authority on certain tax positions. In total, non-GAAP diluted EPS was $2.02 per share, as compared to $2.29 per share in the same period last year, primarily reflecting higher acquired IPR&D and tax expense, partially offset by higher product sales. As mentioned earlier, the $320 million expense related to buyout of global Livdelzi royalties from Janssen impacted our EPS by $0.20 per share. As highlighted on Slide 28, we had a strong first nine months of the year, with solid performance in each of our core franchises across HIV, Oncology, and Liver Diseas”