Novo Nordisk stock (NVO) plunged approximately 15% after the Danish pharmaceutical giant posted better-than-expected 2025 results but delivered a weak 2026 outlook.
The company reported full-year 2025 sales growth of 10% at constant exchange rates, remaining within its prior guidance range of 8-11%, yet warned that sales will collapse between 5% to 13% in 2026.
That abrupt reversal triggered panic selling as investors grasped that Novo’s obesity and diabetes drug empire faces relentless competitive pressure and pricing headwinds.
The paradox displays Novo Nordisk’s predicament: Wegovy and Ozempic remain blockbusters with global demand, yet that dominance is eroding fast.
For 2025, the company delivered DKK 309 billion in sales (approximately $48-$49 billion), underpinned by continued strength in Wegovy and Ozempic.
Operating profit grew 6%, beating the low end of guidance. On any other earnings day, this print would trigger a rally, but on Tuesday, it triggered capitulation.
Novo Nordisk stock: Why guidance alarmed investors
The 2026 sales decline forecast exposes Novo’s major crisis: the company explicitly told shareholders to expect US operations to contract.
Management forecast “sales growth in International Operations while expecting a downturn within US Operations,” the company’s way of saying that it is losing share in the world’s largest obesity and diabetes market.
The guidance assumes three structural headwinds.
First, Eli Lilly’s Zepbound and Mounjaro have captured dominant prescription share; data from late 2025 shows Zepbound accounts for 59% of prescriptions versus Wegovy’s 40%.
Second, generic and compounded versions of semaglutide (Novo’s active ingredient) have proliferated in the US, eroding branded pricing power.
Third, US government price negotiations and insurance formula shifts are squeezing reimbursement margins.
CEO Mike Doustdar stated the company is banking on the Wegovy oral pill and the next-generation injectable CagriSema to recapture the US market share.
Both are critical catalysts, yet neither is guaranteed to move the needle given Eli Lilly’s first-mover advantage with its own pill formulation set to launch in H1 2026.
Competition, pricing and patent pressure
Novo’s semaglutide patent faces expiration in major markets, including Canada, Brazil, and China during 2026, opening those territories to generic competition immediately.
Meanwhile, Eli Lilly’s tirzepatide (Mounjaro/Zepbound) has demonstrated superior weight loss in head-to-head clinical trials.
Barclays analyst James Gordon warned that the 2026 guidance could trigger further analyst downgrades.
Though he noted the outlook might eventually offer “a moment for investors to reassess” if Novo’s oral launch gains traction in the self-pay channel.
Yet that is a risky call: if Wegovy pills cannibalize Ozempic prescriptions without winning back share from Lilly, operating leverage evaporates.
Novo’s 2025 shares fell 46.5%, and early 2026 has brought little relief.
The stock’s near-term fate hinges on prescription data from US pharmacies over the next 90 days.
If Wegovy pills show momentum, a relief rally is possible. If Lilly continues gaining, further downside toward $45–$48 looms.
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