What Has Changed About Owning Gilead Stock?
Investors holding Gilead Sciences (GILD) likely bought into a steady profit engine. The company relies on HIV drugs, led by Biktarvy, to earn money year after year and fund a reliable dividend. Gilead spent the first half of 2026 acquiring other businesses, including Arcellx and Tubulis, before reporting its fiscal second quarter on August 4, 2026. What did those deals do to the profit you were counting on?
Gilead Now Reports A Loss Over Twelve Months
Over the four fiscal quarters ended June 30, 2026, Gilead lost $3.24 billion. That compares with a profit of $9.22 billion over the four quarters ended March 31. Before this recent period, the company had posted a twelve-month profit for 23 consecutive quarter ends, stretching from September 2020 to March 2026.
The entire swing originated in a single quarter. Gilead lost $10.5 billion in its fiscal second quarter, following a $2.02 billion profit in the first.
When Gilead Sciences is a large share of what you own, every change in its numbers moves your whole plan. See how to protect a concentrated position.
Why Did Gilead Swing To A Loss?
Gilead swung to a loss because it booked the cost of acquired research programs. Management recorded $11.2 billion in acquired research expenses during the fiscal second quarter, mainly from the purchases of Arcellx, Tubulis and Ouro Medicines. Reuters reported on August 4 that the quarterly loss came from costs related to the acquisitions.
The underlying drug business continued to grow. Executives reported $7.6 billion in product sales for the fiscal second quarter, up 8% from a year earlier. HIV drugs make up most of those sales. HIV sales reached $5.7 billion, representing a 12% increase from a year earlier. The company also said it does not expect to pursue more sizable acquisitions in 2026 while it folds the new programs into the broader business.
What Does Gilead’s Loss Mean For Your Money?
The cash funding the dividend grew even as reported profit turned to a loss, offering a bright spot for shareholders. Gilead generated $12.9 billion of free cash flow over the last twelve months, up from $9.37 billion over the twelve months before. The company paid $4.07 billion in dividends over the same twelve months, consuming less than a third of that free cash flow.
The loss does change how investors can value the stock. With a loss over twelve months, Gilead no longer has a meaningful price-to-earnings ratio. Management expects a loss for fiscal 2026 as a whole, guiding on August 4 to a diluted loss of $3.40 to $3.75 per share. That amounts to a loss of about $3.58 at the midpoint, wider than the $3.05 loss (at the mid-point of the range) it guided in May. Gilead’s fiscal third-quarter report is expected on October 29, 2026.
Through March 2026, Gilead had earned a profit over every twelve-month stretch for years, though its May guidance already pointed to a full-year loss. That record has now ended. Yet the cash behind the dividend still holds up, growing alongside the underlying drug sales. That free cash flow stayed positive at $3.43 billion in the second quarter, largely because it does not count the $11.2 billion acquired research charge. When that October report arrives, net income for the third quarter alone is the key number to watch.
Is Too Much Of Your Wealth Riding On One Stock?
The Gilead Sciences you own today is not quite the one you bought. When one position grows into a large part of your wealth, a sharp fall can hurt your whole plan, and selling to spread the money out can bring a large tax bill. Glenn Caldicott, CIO of our Boston-based partner firm Empirical Asset Management, an SEC-registered investment adviser, offers a free 15-minute strategy review of ways to protect a concentrated position and unwind it with less tax.