Pharmaceutical company Amneal Pharmaceuticals (NASDAQ: AMRX) reported Q4 CY2025 results topping the market’s revenue expectations, with sales up 11.5% year on year to $814.3 million. On the other hand, the company’s full-year revenue guidance of $3.1 billion at the midpoint came in 3.4% below analysts’ estimates. Its non-GAAP profit of $0.21 per share was 14.1% above analysts’ consensus estimates.

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Company Overview

Founded in 2002 and growing into one of America's largest generic drug producers, Amneal Pharmaceuticals (NASDAQ: AMRX) develops, manufactures, and distributes generic medicines, specialty branded drugs, biosimilars, and injectable products for the U.S. healthcare market.

Revenue Growth

Reviewing a company’s long-term sales performance reveals insights into its quality. Any business can experience short-term success, but top-performing ones enjoy sustained growth for years. Luckily, Amneal’s sales grew at a decent 8.7% compounded annual growth rate over the last five years. Its growth was slightly above the average healthcare company and shows its offerings resonate with customers.

Long-term growth is the most important, but within healthcare, a half-decade historical view may miss new innovations or demand cycles. Amneal’s annualized revenue growth of 12.3% over the last two years is above its five-year trend, suggesting its demand recently accelerated.

This quarter, Amneal reported year-on-year revenue growth of 11.5%, and its $814.3 million of revenue exceeded Wall Street’s estimates by 0.9%.

Looking ahead, sell-side analysts expect revenue to grow 6.1% over the next 12 months, a deceleration versus the last two years. Despite the slowdown, this projection is above average for the sector and suggests the market is baking in some success for its newer products and services.

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Operating Margin

Amneal was profitable over the last five years but held back by its large cost base. Its average operating margin of 7.2% was weak for a healthcare business.

On the plus side, Amneal’s operating margin rose by 5.8 percentage points over the last five years, as its sales growth gave it operating leverage. Zooming in on its more recent performance, we can see the company’s trajectory is intact as its margin has also increased by 4.5 percentage points on a two-year basis.

In Q4, Amneal generated an operating margin profit margin of 13.8%, up 3.4 percentage points year on year. This increase was a welcome development and shows it was more efficient.

Earnings Per Share

We track the long-term change in earnings per share (EPS) for the same reason as long-term revenue growth. Compared to revenue, however, EPS highlights whether a company’s growth is profitable.

Amneal’s EPS grew at a decent 5.9% compounded annual growth rate over the last five years. Despite its operating margin improvement during that time, this performance was lower than its 8.7% annualized revenue growth, telling us that non-fundamental factors such as interest and taxes affected its ultimate earnings.

Diving into the nuances of Amneal’s earnings can give us a better understanding of its performance. A five-year view shows Amneal has diluted its shareholders, growing its share count by 122%. This dilution overshadowed its increased operational efficiency and has led to lower per share earnings. Taxes and interest expenses can also affect EPS but don’t tell us as much about a company’s fundamentals.

In Q4, Amneal reported adjusted EPS of $0.21, up from $0.12 in the same quarter last year. This print easily cleared analysts’ estimates, and shareholders should be content with the results. Over the next 12 months, Wall Street expects Amneal’s full-year EPS of $0.84 to grow 13.1%.

Key Takeaways from Amneal’s Q4 Results

We enjoyed seeing Amneal beat analysts’ full-year EPS guidance expectations this quarter. We were also glad its EPS outperformed Wall Street’s estimates. On the other hand, its full-year revenue guidance missed. Zooming out, we think this was a mixed quarter. The stock remained flat at $14.35 immediately following the results.

Should you buy the stock or not? What happened in the latest quarter matters, but not as much as longer-term business quality and valuation, when deciding whether to invest in this stock. We cover that in our actionable full research report which you can read here (it’s free).