Detailed financial statements for Merck & Co., Inc. (MRK): income statement, balance sheet and cash-flow summary. Track margins, debt, liquidity and profitability trends year over year: ten fiscal years free and up to 20 with Premium.
Merck & Co., Inc. is a global healthcare leader with operations spanning two core divisions: Pharmaceuticals and Animal Health. The Pharmaceutical segment is dedicated to human health, offering a broad spectrum of medicinal products. These cover crucial therapeutic areas such as oncology, acute hospital care, immunology, neuroscience, virology, cardiovascular conditions, and diabetes.
Analysis Summary
Merck & Co., Inc. reported revenue of $64.93B in the most recent fiscal year, growing at a 5-year CAGR of 9.4%. Net income reached $18.25B, with a 20.9% 5-year CAGR.
Trailing-twelve-month margins: gross margin 75.4%, operating margin 16.7%, net margin 4.8%. Free cash flow grew at 16.2% CAGR over 5 years.
At the current price of $144.30, MRK trades at a P/E of 115.44 and an ROE of 6.60%. Market capitalisation stands at $356.4B, placing it among large-cap names.
Balance sheet quality for MRK: current ratio of 1.5, net debt of $35.97B. A debt-to-equity below 1.0 typically signals conservative capital structure, while a current ratio above 1.5 indicates comfortable short-term liquidity.
Cash flow quality is below average: free cash flow of $12.36B represents 68% conversion of reported net income. High conversion (above 90%) suggests earnings translate cleanly into cash; lower conversion may indicate working capital tightness or accounting timing differences.
Income Statement (10y)
| Year | 2016 | 2017 | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|---|---|---|---|---|---|
| Revenue | $39.81B | $40.12B | $42.29B | $39.12B | $41.52B | $48.70B | $59.28B | $60.12B | $64.17B | $64.93B |
| Cost of Revenue | $14.03B | $12.91B | $13.51B | $12.02B | $13.62B | $13.63B | $17.41B | $16.13B | $15.19B | $18.20B |
| Gross Profit | $25.78B | $27.21B | $28.79B | $27.11B | $27.90B | $35.08B | $41.87B | $43.99B | $48.98B | $46.73B |
| Research & Development | $10.26B | $10.34B | $9.75B | $9.72B | $13.40B | $12.24B | $13.55B | $30.53B | $17.94B | $12.51B |
| Selling, General & Admin | $10.02B | $10.07B | $10.10B | $9.46B | $8.57B | $9.40B | $9.67B | $9.88B | $10.10B | $10.73B |
| Operating Expenses | $20.28B | $20.41B | $19.85B | $19.18B | $22.35B | $21.88B | $23.59B | $41.03B | $28.75B | $23.25B |
| Operating Income | $5.50B | $6.80B | $8.93B | $7.93B | $5.55B | $13.20B | $18.28B | $2.95B | $20.22B | $23.49B |
| EBITDA | $10.82B | $11.95B | $13.99B | $11.37B | $10.18B | $17.90B | $21.32B | $6.91B | $25.71B | $28.26B |
| Interest Expense | $693.0M | $754.0M | $772.0M | $893.0M | $831.0M | $806.0M | $962.0M | $1.15B | $1.27B | $1.36B |
| Pre-tax Income | $4.66B | $6.52B | $8.70B | $7.17B | $5.86B | $13.88B | $16.44B | $1.89B | $19.94B | $21.07B |
| Income Tax | $718.0M | $4.10B | $2.51B | $1.56B | $1.34B | $1.52B | $1.92B | $1.51B | $2.80B | $2.80B |
| Net Income | $3.92B | $2.39B | $6.22B | $9.84B | $7.07B | $13.05B | $14.52B | $365.0M | $17.12B | $18.25B |
| EPS | $2.07 | $0.95 | $2.40 | $3.84 | $2.79 | $5.16 | $5.73 | $0.14 | $6.76 | $7.30 |
| EPS (Diluted) | $2.04 | $0.93 | $2.32 | $3.82 | $2.78 | $5.14 | $5.71 | $0.14 | $6.74 | $7.28 |
| Shares Outstanding (Diluted) | $2.79B | $2.75B | $2.68B | $2.58B | $2.54B | $2.54B | $2.54B | $2.55B | $2.54B | $2.51B |
Income Statement (Quarterly)
| Year | 2025-Q3 | 2025-Q4 | 2026-Q1 | 2026-Q2 |
|---|---|---|---|---|
| Revenue | $17.18B | $16.32B | $16.29B | $16.61B |
| Gross Profit | $12.99B | $11.51B | $13.34B | $12.21B |
| Operating Income | $7.46B | $6.16B | -$1.88B | -$683.0M |
| EBITDA | $8.14B | $6.30B | -$2.02B | $1.43B |
| Net Income | $5.79B | $2.96B | -$4.24B | -$1.33B |
| EPS | $2.32 | $1.20 | $-1.72 | $-0.54 |
| EPS (Diluted) | $2.32 | $1.19 | $-1.72 | $-0.54 |
Balance Sheet (10y)
| Year | 2016 | 2017 | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|---|---|---|---|---|---|
| Cash & Equivalents | $6.51B | $6.09B | $7.96B | $9.68B | $8.05B | $8.10B | $12.69B | $6.84B | $13.24B | $14.56B |
| Short-term Investments | $7.83B | $2.41B | $899.0M | $774.0M | 0 | 0 | $498.0M | $252.0M | $447.0M | 0 |
| Receivables | $7.02B | $6.87B | $7.07B | $6.78B | $6.80B | $9.23B | $9.45B | $10.35B | $10.28B | $12.68B |
| Inventory | $4.87B | $5.10B | $5.44B | $5.98B | $5.55B | $5.95B | $5.91B | $6.36B | $6.11B | $6.66B |
| Total Current Assets | $30.61B | $24.77B | $25.88B | $27.48B | $27.76B | $30.27B | $35.72B | $32.17B | $38.78B | $43.52B |
| Property, Plant & Equipment | $12.03B | $12.44B | $13.29B | $15.05B | $17.00B | $19.28B | $21.42B | $23.05B | $23.78B | $26.82B |
| Goodwill | $18.16B | $18.28B | $18.25B | $19.43B | $18.88B | $21.26B | $21.20B | $21.20B | $21.67B | $21.58B |
| Intangible Assets | $17.30B | $14.18B | $13.10B | $14.20B | $14.10B | $22.93B | $20.27B | $18.01B | $16.37B | $26.68B |
| Total Assets | $95.38B | $87.87B | $82.64B | $84.40B | $91.59B | $105.69B | $109.16B | $106.67B | $117.11B | $136.87B |
| Accounts Payable | $2.81B | $3.10B | $3.32B | $3.74B | $4.33B | $4.61B | $4.26B | $3.92B | $4.08B | $4.40B |
| Short-term Debt | $568.0M | $3.06B | $5.31B | $3.61B | $6.43B | $2.41B | $1.95B | $1.37B | $2.65B | $2.88B |
| Total Current Liabilities | $17.20B | $18.61B | $22.21B | $22.22B | $27.33B | $23.87B | $24.24B | $25.69B | $28.42B | $28.33B |
| Long-term Debt | $24.27B | $21.35B | $19.81B | $22.74B | $25.36B | $30.69B | $28.75B | $33.68B | $34.46B | $46.75B |
| Total Liabilities | $55.07B | $53.30B | $55.76B | $58.40B | $66.18B | $67.44B | $63.10B | $69.04B | $70.73B | $84.20B |
| Retained Earnings | $44.13B | $41.35B | $42.58B | $46.60B | $47.36B | $53.70B | $61.08B | $53.90B | $63.07B | $73.08B |
| Total Equity | $40.09B | $34.34B | $26.70B | $25.91B | $25.32B | $38.18B | $45.99B | $37.58B | $46.31B | $52.61B |
| Total Debt | $24.84B | $24.41B | $25.11B | $27.35B | $33.42B | $34.63B | $31.98B | $36.27B | $38.27B | $50.53B |
| Net Debt | $10.50B | $15.91B | $16.25B | $16.90B | $25.37B | $26.54B | $18.79B | $29.18B | $24.58B | $35.97B |
| Working Capital | $13.41B | $6.15B | $3.67B | $5.26B | $437.0M | $6.39B | $11.48B | $6.47B | $10.36B | $15.19B |
Balance Sheet (Quarterly)
| Year | 2025-Q3 | 2025-Q4 | 2026-Q1 | 2026-Q2 |
|---|---|---|---|---|
| Cash & Equivalents | $18.17B | $14.56B | $5.33B | $6.85B |
| Total Assets | $129.55B | $136.87B | $128.69B | $129.80B |
| Total Liabilities | $77.64B | $84.20B | $82.75B | $87.82B |
| Total Equity | $51.85B | $52.61B | $45.88B | $41.93B |
| Total Debt | $41.37B | $50.53B | $49.12B | $53.91B |
Cash Flow (10y)
| Year | 2016 | 2017 | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|---|---|---|---|---|---|
| Net Income | $3.94B | $2.42B | $6.19B | $9.78B | $7.08B | $12.36B | $14.53B | $365.0M | $17.13B | $18.25B |
| Depreciation & Amortization | $5.44B | $4.64B | $4.52B | $3.65B | $3.62B | $3.21B | $3.91B | $3.87B | $4.50B | $5.84B |
| Stock-based Compensation | $300.0M | $312.0M | $348.0M | $417.0M | $441.0M | $479.0M | $541.0M | $645.0M | $761.0M | 0 |
| Change in Working Capital | -$2.60B | -$5.02B | -$1.55B | -$2.07B | -$4.59B | -$3.84B | -$2.78B | -$2.21B | -$3.67B | -$6.98B |
| Operating Cash Flow | $10.38B | $6.45B | $10.92B | $13.44B | $10.25B | $14.11B | $19.09B | $13.01B | $21.47B | $16.47B |
| Capital Expenditure | -$1.61B | -$1.89B | -$2.62B | -$3.47B | -$4.43B | -$4.45B | -$4.39B | -$3.86B | -$3.37B | -$4.11B |
| Acquisitions | -$780.0M | -$396.0M | -$431.0M | -$4.95B | -$6.61B | -$12.91B | -$121.0M | -$12.03B | -$4.09B | -$10.04B |
| Stock Repurchased | -$3.43B | -$4.01B | -$9.09B | -$4.78B | -$1.28B | -$840.0M | 0 | -$1.35B | -$1.31B | -$5.08B |
| Dividends Paid | -$5.12B | -$5.17B | -$5.17B | -$5.70B | -$6.21B | -$6.61B | -$7.01B | -$7.45B | -$7.84B | -$8.18B |
| Free Cash Flow | $8.76B | $4.56B | $8.31B | $9.97B | $5.82B | $9.66B | $14.71B | $9.14B | $18.10B | $12.36B |
Cash Flow (Quarterly)
| Year | 2025-Q3 | 2025-Q4 | 2026-Q1 | 2026-Q2 |
|---|---|---|---|---|
| Operating Cash Flow | $7.82B | $2.86B | $3.92B | $5.37B |
| Capital Expenditure | -$987.0M | -$1.03B | -$991.0M | -$893.0M |
| Free Cash Flow | $6.83B | $1.82B | $2.93B | $4.48B |
| Dividends Paid | -$2.03B | -$2.02B | -$2.10B | -$2.14B |
| Stock-based Compensation | $204.0M | $205.0M | $185.0M | $298.0M |
Growth & Margins (10y)
| Year | 2016 | 2017 | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|---|---|---|---|---|---|
| Revenue Growth (YoY) | +0.8% | +5.4% | -7.5% | +6.1% | +17.3% | +21.7% | +1.4% | +6.7% | +1.2% | |
| Net Income Growth (YoY) | -38.9% | +159.8% | +58.2% | -28.2% | +84.6% | +11.3% | -97.5% | +4,589.6% | +6.6% | |
| EPS Growth (YoY) | -54.1% | +152.6% | +60.0% | -27.3% | +84.9% | +11.0% | -97.6% | +4,728.6% | +8.0% | |
| Shares Change (YoY) | -1.4% | -2.5% | -3.7% | -1.5% | -0.1% | +0.2% | +0.2% | -0.2% | -1.3% | |
| FCF Growth (YoY) | -47.9% | +82.1% | +20.0% | -41.6% | +65.9% | +52.2% | -37.8% | +97.9% | -31.7% | |
| Gross Margin | 64.8% | 67.8% | 68.1% | 69.3% | 67.2% | 72.0% | 70.6% | 73.2% | 76.3% | 72.0% |
| Operating Margin | 13.8% | 16.9% | 21.1% | 20.3% | 13.4% | 27.1% | 30.8% | 4.9% | 31.5% | 36.2% |
| EBITDA Margin | 27.2% | 29.8% | 33.1% | 29.1% | 24.5% | 36.8% | 36.0% | 11.5% | 40.1% | 43.5% |
| Net Margin | 9.8% | 6.0% | 14.7% | 25.2% | 17.0% | 26.8% | 24.5% | 0.6% | 26.7% | 28.1% |
| FCF Margin | 22.0% | 11.4% | 19.6% | 25.5% | 14.0% | 19.8% | 24.8% | 15.2% | 28.2% | 19.0% |
| Effective Tax Rate | 15.4% | 62.9% | 28.8% | 21.8% | 22.9% | 11.0% | 11.7% | 80.0% | 14.1% | 13.3% |
Per-Share Data (10y)
| Year | 2016 | 2017 | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|---|---|---|---|---|---|
| FCF Per Share | $3.14 | $1.66 | $3.10 | $3.86 | $2.29 | $3.81 | $5.79 | $3.59 | $7.12 | $4.93 |
| Dividends Per Share | $1.84 | $1.88 | $1.93 | $2.21 | $2.45 | $2.60 | $2.76 | $2.92 | $3.09 | $3.26 |
| Shares Outstanding (Basic) | $2.75B | $2.70B | $2.59B | $2.56B | $2.53B | $2.53B | $2.53B | $2.55B | $2.53B | $2.50B |
What to look at in Healthcare / Pharma
The R&D pipeline is the invisible asset. Patents expiring = revenues evaporating. Look at innovation and cash flow.
- R&D / Revenue — Shows investment in future pipeline. Serious pharma reinvests 15-20%
- 5y EPS growth — After patent expirations, are they still growing?
- Gross margin — Branded pharma >70%. Generics much lower — defines the business type
- FCF / Net Income — Earnings quality — big pharma should convert >90%
- ROIC — Capital reinvested efficiently — key in pharma due to long R&D cycles
- Net debt / EBITDA — Pharma acquisitions pile up debt — watch the post-M&A picture
- P/E vs own 10y history — The best comparison is with its own history, not with peers
Profitability
| Return on Equity | 6.60% |
| Return on Invested Capital | 5.62% |
| Return on Assets | 2.44% |
| Gross Margin | 75.38% |
| Operating Margin | 16.65% |
| Net Margin | 4.78% |
Financial Health
| Debt / Equity | 1.29 |
| Current Ratio | 1.32 |
| Piotroski F-Score | 4 |
| Altman Z-Score | 3.80 |
Key Ratios (10y)
| Year | 2016 | 2017 | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|---|---|---|---|---|---|
| P/E | 27.12 | 56.47 | 30.36 | 22.58 | 27.96 | 14.85 | 19.36 | 778.71 | 14.72 | 14.42 |
| P/B | 3.85 | 4.21 | 7.07 | 8.59 | 7.79 | 5.08 | 6.11 | 7.39 | 5.44 | 5.01 |
| P/S | 3.88 | 3.61 | 4.47 | 5.69 | 4.75 | 3.98 | 4.74 | 4.62 | 3.93 | 4.06 |
| Gross Margin | 64.8% | 67.8% | 68.1% | 69.3% | 67.2% | 72.0% | 70.6% | 73.2% | 76.3% | 72.0% |
| Operating Margin | 13.8% | 16.9% | 21.1% | 20.3% | 13.4% | 27.1% | 30.8% | 4.9% | 31.5% | 36.2% |
| Net Margin | 9.8% | 6.0% | 14.7% | 25.2% | 17.0% | 26.8% | 24.5% | 0.6% | 26.7% | 28.1% |
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