Stock prices for Novo Nordisk plummet by 20% following the pharmaceutical company's downgrade of its 2025 revenue expectations.
In a significant development, Danish pharmaceutical giant Novo Nordisk has revised its full-year 2025 financial expectations due to weaker sales of its popular weight-loss drug Wegovy. The company's stock price has taken a hit, with a sharp drop of over 20% in a single day following the announcement on July 29, 2025.
The revised outlook reflects a reduction in expected sales growth to 8-14%, down from 13-21%, and operating profit growth to 10-16%, down from 16-24%, all at constant exchange rates. The changes were primarily driven by increased competition impacting Wegovy sales and slower market expansion, as well as the persistent use of compounded GLP-1 drugs.
Novo Nordisk has been facing stiff competition in the weight-loss market, with copycat drugs eating into its market share. The sluggish demand for Wegovy and its rival drug Ozempic in the United States has also contributed to the revision. Lower-than-expected market penetration of Wegovy in international regions has further compounded the issue.
The company's new CEO, who was recently appointed, is now tasked with steering the company through these challenging times. Novo Nordisk had been a major player in the treatment of obesity, but the recent developments have put pressure on its position in the market.
The performance of Eli Lilly in diabetes and obesity care is impacting the market sentiment towards Novo Nordisk. Recently, competitors in diabetes and obesity care, including Eli Lilly, have experienced a setback. However, this has cast doubt on investors about Novo Nordisk's ability to retain its market share.
Institutional investors might continue to sell Novo Nordisk shares due to current prices being below technical levels of support. The total loss in two days exceeds 23%. The stock had fallen earlier by 3.77% yesterday in trading hours on Monday, and Novo Nordisk stocks plunged by 7% in premarket trading.
Despite these challenges, Novo Nordisk is not giving up. The company is actively combating knockoff semaglutide drugs through legal and regulatory avenues, signaling concerns about potential continued impacts on its product sales.
As Novo Nordisk moves forward, investors will closely follow upcoming quarterly reports to understand if the company can stabilize results and win back shareholders' acceptance. The recent events have prompted a wider re-evaluation of Novo Nordisk's long-term potential by investors, and the company will need to demonstrate its resilience in the face of competition to regain its footing in the market.
The revised financial expectations for Novo Nordisk indicate reduced sales growth and operating profit growth due to increased competition, slower market expansion, and the persistent use of compounded GLP-1 drugs in the stock-market, possibly leading to a need for investing strategies that account for these challenges. The current situation, with institutional investors continuing to sell Novo Nordisk shares due to the drop in stock price below technical support levels, raises questions about the company's long-term finance prospects as investors closely monitor upcoming quarterly reports to assess its resilience in the face of competition.
