Dr. Reddy’s Laboratories (NYSE:RDY) reported fiscal third-quarter revenue that surpassed analyst expectations Wednesday, as explosive growth in emerging markets and a resilient domestic business in India helped offset a steep decline in its North American generic portfolio.
The Hyderabad-based pharmaceutical giant posted total revenue of $971 million, a 4.4% increase year-over-year, beating the average estimate of $935.3 million.
Despite the revenue beat, net income fell 14% to $135 million, or $0.16 per share, compared to the same period last year.
The decline was primarily driven by lower sales of the blockbuster cancer drug Lenalidomide in the U.S. market, which contributed to a 12% revenue drop in North America.
Profitability was further impacted by a one-time provision related to the implementation of India's New Labour Codes, though underlying EBITDA margins remained stable at 24.8% when adjusting for these regulatory costs.
CEO Erez Israeli noted that while North American pricing pressure remains a challenge, the company is pivoting toward complex biosimilars and a massive global rollout of Semaglutide (generic Ozempic/Wegovy) starting in early 2026.
The firm has already secured manufacturing licenses in India and aims to produce 12 million injector pens annually to capture a significant share of the global weight-loss and diabetes market.