Accelerated Price, Organic Constant Currency Revenue Growth, and Gross Margin Expansion; Raising Full Year Outlook and Innovation Target; Achieved 2.9x Net Leverage Ratio Milestone
- Third Quarter 2026 Financial Results:
- Revenue of $1.265 billion, an increase of 11% year-over-year; 9% organic constant currency growth
- Reported Net Income of $18 million, Adjusted Net Income of $136 million
- Adjusted EBITDA of $243 million; Adjusted EBITDA Margin of 19.5%
- Reported EPS of $0.04, Adjusted EPS of $0.27
- Net leverage ratio of 2.9x Adjusted EBITDA
- Full Year 2026 Guidance:
- Raising innovation revenue target to $1.275 billion
- Raising revenue guidance to $5.155 billion to $5.18 billion, or approximately 8% organic constant currency growth
- Raising Adjusted EBITDA guidance to $1.05 billion to $1.065 billion, a year-over-year increase of 17% at midpoint
- Raising Adjusted EPS guidance to $1.17 to $1.20, a year-over-year increase of 26% at midpoint
- Improving year-end net leverage ratio target to approximately 2.9x Adjusted EBITDA with accelerated capital allocation flexibility
- 2027 Early Outlook:
- Building on expectations for full year 2026 outperformance, with continued expectation for 2027 results in line with December 2025 Investor Day annual algorithm: mid-single digit organic constant currency revenue growth, high-single digit Adjusted EBITDA growth, and low-double digit Adjusted EPS growth
Indianapolis, IN (November 6, 2026) - Elanco Animal Health Incorporated (NYSE: ELAN) today reported financial results for the third quarter of 2026, provided guidance for the fourth quarter of 2026, updated guidance for the full year 2026, and provided an early outlook for the full year 2027.
"Third quarter results demonstrate Elanco is a consistent, reliable growth company, delivering our diverse portfolio of innovation along with accelerating cash flow," stated Jeff Simmons, President and CEO of Elanco. "Organic constant currency revenue growth of 9% was led by International Pet Health up 17% and U.S. Pet Health up 13%, as we saw strong veterinarian and pet owner demand for what we believe is 'best medicine' innovation for our 'Big 6' growth led by Zenrelia and Credelio Quattro. Price accelerated to 4% growth, exceeding our expectations, while volume remained robust at 5%. Our durable top-line is fueled by a significant runway for share gains off a small base in large, growing, global markets. Both Zenrelia and Credelio Quattro reached new market share highs in September, with competitive activity having no fundamental impact on the trajectory of our innovation. At the same time, adjusted gross margin expanded 300 basis points, we invested in our commercial execution, and we drove our net leverage ratio to the 2.9x milestone which accelerates our capital allocation flexibility. As we are raising full-year guidance to fully pass through the third quarter beat, Elanco is well positioned with momentum heading into 2027. We are recommitting to our annual algorithm of mid-single digit organic constant currency revenue growth, high-single digit adjusted EBITDA growth, and low-double digit adjusted EPS growth, building on this year's expected outperformance and creating sustainable value for our customers, our shareholders, and the industry."
Select Business Highlights Since the Last Earnings Call
- Price increased 4% in Q3 led by global Pet Health at 5% including strong sequential acceleration in U.S. Pet Health versus Q2, as Elanco's differentiated innovation drives marketplace value
- Zenrelia™ achieved its largest revenue quarter ever, in both the U.S. and International, with September its largest month ever; U.S. JAK market share grew 7 points year-over-year with September its highest share month ever**; efficacy is driving use with 1,600 new clinics in Q3 to approximately 19,000 in the U.S.; gained 10 share points in Europe in H1 2026 (latest available data), 5x the competitive entrant, driven by high customer satisfaction***
- Credelio Quattro™ U.S. share grew 9 points year-over-year**; September was the largest sales month in Q3, and its highest share month ever**; continued clinic adoption momentum with 1,600 clinics added in Q3; total clinic penetration reaching over 16,500, or ~55%; Credelio Quattro became Elanco’s largest U.S. Pet Health branded product, surpassing Seresto U.S.
- Credelio Quattro received positive opinion from European Medicines Agency for expansion into the EU; expect to launch in Q1 2027, ahead of the season
- Befrena™ access now open across clinics, including corporates, with all outstanding orders expected to be filled by next week and move into full launch in Q1 2027. Portfolio effect is working as ~20% of clinics that bought Befrena had never used Zenrelia
- Global ruminants remained Elanco's fastest growing species, with revenue up 12% year-to-date on an organic constant currency basis or 17% including AHV International and foreign exchange rates, as innovation fortified the company's beef and dairy portfolio
- Elanco announced Jamie Preston as Executive Vice President and Chief People Officer effective November 3, succeeding Dave Kinard who intends to retire at the end of the year. Preston joins from Eli Lilly and Company, most recently serving as Vice President of HR, Global Compensation and Workforce Innovation
- Elanco achieved its highest employee engagement levels since IPO, with all functions growing engagement and outpacing enterprise benchmarks; momentum further validated by earning Great Place To Work® certifications in 11 markets where the company operates
**Per Kynetec data
***Internal estimates based on multiple data sources
