“Given the LOE impact over the next few years, we expect leverage to remain around current level or modestly higher through this transition period.”

In context

“Cecile Guegan (Incoming Interim Chief Financial Officer): Thank you, Albert and Dave, and good morning. Before I discuss second quarter results, I want to underscore Albert's comment. I believe Pfizer is well positioned to return to growth from 2029 onward and create meaningful value for shareholders. We will continue to execute a disciplined approach to capital allocation, making targeted investment today to drive revenue growth later in the decade and beyond. We intend to do this while maintaining and, over the long term, growing the dividend. Our business is performing well. Commercial execution is driving strong results, including 18% operational revenue growth in our launched and acquired products this quarter. We continue to strengthen and advance our pipeline. With the continued growth of our launched and acquired products, we are laying the groundwork for high single-digit revenue growth towards the end of the decade. Our second quarter adjusted earnings performance reflects disciplined execution across our strategic priorities and continued progress towards building the foundation for durable long-term value creation. I will review our results from the quarter, productivity enhancement initiatives, capital allocation priorities and full year guidance. We are raising the midpoint of our revenue guidance range despite lower-than-expected COVID revenues. We are also reaffirming adjusted diluted EPS guidance, which absorbs an approximately $0.10 impact related to the Innovent Biologics transaction that closed in the third quarter of 2026. We delivered revenue growth in the quarter through disciplined execution across key brands in the U.S. and select international markets. Second quarter 2026 revenues were $15 billion, ahead of our expectations and representing a year-over-year operational increase of 1%. Excluding COVID products, the underlying business delivered 5% operational revenue growth. Progress leveraging data and scaling AI across the company supported our field force in driving access and increasing uptake for new launches. Our commercial performance has also helped mitigate the impact of currently low COVID infection levels. On the bottom line, second quarter adjusted diluted EPS was $0.77, also exceeding our expectations. This outperformance reflects continued cost discipline and productivity across the organization, while we still advance several Phase III study starts across our pipeline. Our results this quarter demonstrate the effectiveness of our commercial strategy. We saw solid contribution across the portfolio, primarily driven by Eliquis, Padcev, the Vyndaqel family, and Lorbrena, each reflecting focused execution in key therapeutic areas. We also expect post-2028 cash flow to benefit from the previously announced Vyndamax patent settlement. Across international and U.S. markets, our commercial teams are focused on identifying patients, enabling access and supporting duration of therapy based on clinical data. This has helped us maintain leadership position across oncology and vaccines and unlock new opportunities. We continue to drive value in key in-line products ahead of approaching LOEs, while our launched and acquired products delivered $3.2 billion in revenues and grew 18% operationally in the quarter. Of note, this growth rate was tempered by one-time items recorded in the second quarter of 2025, mostly impacting the legacy Seagen in-line portfolio. Excluding this impact, the growth rate was 27%. We continue to invest behind in-line brands and launched and acquired products to support their growth trajectory and help offset incoming LOE headwinds over the next several years. Financial discipline and strong cost management across our manufacturing footprint remain top priorities. Adjusted gross margin for the second quarter was 76%, primarily reflecting product mix and ongoing cost control measures. We continue to expect $700 million in savings from Phase 1 of our manufacturing optimization program this year with $175 million realized in Q2. Total adjusted operating expenses were $6.1 billion for the second quarter of 2026, an increase of 4% operationally versus second quarter last year. Looking at the components, adjusted SG&A expenses decreased 3% operationally, primarily reflecting lower spending in corporate enabling functions. Adjusted R&D expenses increased 12% operationally, primarily driven by an increase in spending in certain oncology and obesity product candidates. Second quarter 2026 adjusted operating margin was strong at 35%, reflecting effective cost management, strong non-COVID revenue performance and higher R&D investment in the quarter. Turning to the bottom line, Q2 reported loss per share was negative $0.04, and our adjusted diluted EPS was positive $0.77, which benefited from our strong non-COVID revenues and efficient operating structure. Our second quarter GAAP results reflect the impact of the recent Phase III readout for SV in second-line plus non-small cell lung cancer and, to a lesser extent, the removal of revenue projection for Oxbryta following recent discussion with the FDA. The updated forecast resulted in $4.3 billion in noncash intangible asset impairments recorded in the quarter. For SV, we continue to forecast significant risk-adjusted revenue in other non-small cell lung cancer indications, subject to technical and regulatory success. So far, Seagen revenue performance has exceeded our initial expectation, and we aim to continue delivering above initial expectation in the long term. We remain disciplined in operating expense management and focused on long-term margin improvement. We have made meaningful progress on our productivity enhancement initiative and remain on track to deliver most of the anticipated $7.2 billion in total net cost savings by the end of 2026. Building on that momentum, today, we announced the expansion of our ongoing cost improvement programs, which are expected to generate approximately $2.5 billion in additional net cost savings from 2027 through 2029. We now expect $1 billion of additional net cost savings from our productivity enhancement from technology and simplification efforts designed to further reduce SG&A cost. Separately, the next phase of our multiyear manufacturing optimization program is designed to reduce cost of goods sold and deliver approximately $1.5 billion in additional net cost savings, and we expect to begin realizing a portion of this saving in 2027. This next phase focuses on network structure changes, product portfolio enhancement and additional operational efficiency. We now expect total net cost savings from this program of approximately $3 billion through 2029. In summary, we now expect approximately $9.7 billion in total net savings from these programs through 2029. These initiatives are expected to enhance operating efficiency, support continued operating margin expansion and strengthen our ability to invest in innovation and future growth opportunities. Let me now turn to capital allocation. Our strategy is designed to enhance long-term shareholder value while preserving flexibility. It includes reinvesting in the business at appropriate returns, maintaining and over time growing our dividend and preserving optionality for future value-enhancing actions, including share repurchases. In the first half of 2026, we invested $5.5 billion in internal and external R&D and returned $4.9 billion to shareholders via our quarterly dividend. The Innovent Biologics deal closed in July, resulting in an initial $650 million upfront payment to be recorded as acquired in-process R&D expense in the third quarter. Following this transaction, our BD capacity is approximately $6 billion. Second quarter 2026 operating cash flow was $3.45 billion and leverage ended the quarter at 2.7x. Given the LOE impact over the next few years, we expect leverage to remain around current level or modestly higher through this transition period. Earlier in the quarter, we made our final TCJA repatriation tax payment of approximately $2.6 billion and closed on our exit of ViiV, providing approximately $1.65 billion in net cash proceeds. Based on our performance to date and continued execution, we are raising our full year 2026 guidance by $500 million at the midpoint to a range of $60.5 billion to $62.5 billion from $59.5 billion to $60.5 billion. Our updated revenue guidance reflects strong non-COVID product performance and revised revenue expectation of approximately $4 billion, down from $5 billion for COVID-19 revenues. We are reaffirming all other components of guidance, including adjusted diluted EPS guidance of $2.80 to $3. This EPS range now absorbs an unfavorable impact of approximately $0.10 related to the $650 million acquired in-process R&D charge from the Innovent Biologics transaction. This outlook reflects year-to-date performance, confidence in our business, progress with ongoing cost improvement initiatives, our expectation of adjusted gross margin in the mid-70s range and continued investment to support growth by the end of the decade. Low COVID-19 incidence could continue to limit Paxlovid utilization. Our plan also assumes that the majority of COMIRNATY sales will occur toward year-end, consistent with the vaccination season. And as always, we will continue to monitor currency fluctuation as the year progresses. Now I will wrap up with a few key points. Over the next several years, we will continue to position Pfizer for high single-digit revenue growth towards the end of the decade. We will invest in our business with focus and discipline, supporting continued progress with our R&D pipeline and driving commercial impact with our launched and acquired product. We remain committed to disciplined capital allocation with a continued focus on maintaining and, over the long term, growing our dividend while preserving balance sheet strength and flexibility. We will continue to operate with rigor and strategic focus, executing with discipline today while building a strong foundation for the future. I look forward to working with Albert and the entire executive leadership team as we help patients around the world and position Pfizer for long-term growth and shareholder value creation. With that, let me turn over to Chris.”