Revenue contracted 2.3% YoY in 2026Q2, with gross margin down 460 bps from 59.0% in 2024Q1 to 54.4%, reflecting persistent pricing pressure.
Organon & Co. (OGN) annual income statement — 8-year revenue, gross profit & net income history
| Metric | TTM | Dec'25 | Dec'24 | Dec'23 | Dec'22 | Dec'21 | Dec'20 | Dec'19 | Dec'18 |
|---|
| Sales/Revenue | 6.13B | 6.22B | 6.4B | 6.26B | 6.17B | 6.3B | 6.53B | 7.78B | 9.78B |
| Revenue Growth % | -2.45% | -2.92% | 2.24% | 1.44% | -2.06% | -3.49% | -16.01% | -20.46% | - |
| Cost of Goods Sold | 2.88B | 2.85B | 2.69B | 2.52B | 2.29B | 2.38B | 2.12B | 2.27B | 4.69B |
| COGS % of Revenue | - | 45.91% | 41.98% | 40.16% | 37.16% | 37.79% | 32.44% | 29.24% | 48% |
| Gross Profit | 3.25B | 3.36B | 3.71B | 3.75B | 3.88B | 3.92B | 4.41B | 5.5B | 5.08B |
| Gross Margin % | 52.98% | 54.09% | 58.02% | 59.84% | 62.84% | 62.21% | 67.56% | 70.76% | 52% |
| Gross Profit Growth % | - | -9.5% | -0.88% | -3.4% | -1.07% | -11.13% | -19.81% | 8.24% | - |
| Operating Expenses | 2.06B | 2.09B | 2.23B | 2.42B | 2.17B | 2.01B | 1.57B | 1.66B | 2.38B |
| OpEx % of Revenue | - | 33.57% | 34.81% | 38.66% | 35.23% | 31.84% | 23.97% | 21.38% | 24.32% |
| Selling, General & Admin | 1.71B | 1.71B | 1.76B | 1.89B | 1.7B | 1.67B | 1.36B | 1.44B | 2.01B |
| SG&A % of Revenue | - | 27.53% | 27.49% | 30.23% | 27.6% | 26.46% | 20.76% | 18.55% | 20.59% |
| Research & Development | 358M | 366M | 469M | 528M | 471M | 443M | 210M | 220M | 365M |
| R&D % of Revenue | - | 5.89% | 7.32% | 8.43% | 7.63% | 7.03% | 3.21% | 2.83% | 3.73% |
| Other Operating Expenses | 0 | 10M | 0 | 0 | 0 | -104M | 0 | 0 | 0 |
| Operating Income | 1.18B | 1.28B | 1.49B | 1.33B | 1.71B | 1.92B | 2.85B | 3.85B | 2.71B |
| Operating Margin % | 19.29% | 20.67% | 23.21% | 21.19% | 27.62% | 30.38% | 43.59% | 49.47% | 27.68% |
| Operating Income Growth % | - | -13.53% | 11.98% | -22.17% | -10.97% | -32.74% | -25.99% | 42.17% | - |
| EBITDA | 1.53B | 1.64B | 1.76B | 1.56B | 1.92B | 2.11B | 2.99B | 4.2B | 4.38B |
| EBITDA Margin % | 24.96% | 26.36% | 27.53% | 24.96% | 31.05% | 33.47% | 45.76% | 54.02% | 44.79% |
| EBITDA Growth % | -8.5% | -7.07% | 12.8% | -18.47% | -9.15% | -29.41% | -28.85% | -4.06% | - |
| D&A (Non-Cash Add-back) | 347M | 353.33M | 277M | 236M | 212M | 195M | 142M | 354M | 1.67B |
| EBIT | 959M | 929M | 1.33B | 1.2B | 1.54B | 1.79B | 2.85B | 3.56B | 2.71B |
| Net Interest Income | -468M | -504M | -520M | -527M | -422M | -258M | -6M | 13M | 0 |
| Interest Income | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 19M | 0 |
| Interest Expense | 468M | 504M | 520M | 527M | 422M | 258M | 6M | 6M | 0 |
| Other Income/Expense | -691M | -860M | -679M | -654M | -583M | -386M | -95M | -144M | 23M |
| Pretax Income | 491M | 425M | 807M | 673M | 1.12B | 1.53B | 2.75B | 3.7B | 2.73B |
| Pretax Margin % | 8.01% | 6.84% | 12.6% | 10.75% | 18.17% | 24.25% | 42.13% | 47.52% | 27.91% |
| Income Tax | 282M | 238M | -57M | -350M | 205M | 178M | 496M | 390M | 576M |
| Effective Tax Rate % | 57.43% | 56% | -7.06% | -52.01% | 18.27% | 11.64% | 18.02% | 10.55% | 21.11% |
| Net Income | 209M | 187M | 864M | 1.02B | 917M | 1.35B | 2.16B | 3.22B | 2.15B |
| Net Margin % | 3.41% | 3.01% | 13.49% | 16.33% | 14.85% | 21.43% | 33.07% | 41.38% | 22.02% |
| Net Income Growth % | -70.14% | -78.36% | -15.54% | 11.56% | -32.12% | -37.45% | -32.88% | 49.47% | - |
| Net Income (Continuing) | 209M | 187M | 864M | 1.02B | 917M | 1.35B | 2.26B | 3.31B | 2.15B |
| Discontinued Operations | 0 | 0 | 0 | 0 | 0 | 0 | -96M | 0 | 0 |
| Minority Interest | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| EPS (Diluted) | 0.77 | 0.72 | 3.33 | 3.99 | 3.59 | 5.33 | 8.52 | 12.71 | 8.51 |
| EPS Growth % | -71.38% | -78.38% | -16.54% | 11.14% | -32.65% | -37.44% | -32.97% | 49.35% | - |
| EPS (Basic) | - | 0.72 | 3.36 | 4.01 | 3.61 | 5.33 | 8.52 | 12.71 | 8.51 |
| Diluted Shares Outstanding | 270.45M | 260.76M | 259.15M | 256.27M | 255.17M | 253.55M | 253.52M | 253.13M | 253.13M |
| Basic Shares Outstanding | 262.61M | 259.5M | 257.05M | 255.24M | 254.08M | 253.55M | 253.52M | 253.13M | 253.13M |
| Dividend Payout Ratio | - | 47.06% | 34.38% | 28.74% | 31.62% | 10.73% | - | - | - |
Quick answers to the most common questions about buying OGN stock.
For fiscal year 2025, Organon & Co. (OGN) reported total revenue of $6.22B. This represents a 36.4% decline compared to $9.78B in 2018.
Organon & Co. (OGN) is profitable, generating $187.0M in net income for the fiscal year ending 2025 with a net profit margin of 3.0%.
Organon & Co. (OGN) reported an operating income of $1.28B, resulting in an operating profit margin of 20.7%. This margin reflects the operational efficiency of the business before interest and taxes.
Organon & Co. (OGN) generated $3.36B in gross profit for the year, representing a gross profit margin of 54.1%. This demonstrates the company's core pricing power and production efficiency.
Key Metrics
Top Statement Risk
High leverage and China VBP
Metrics are mathematically derived from official filings.
Revenue Slide Persists Amid Portfolio Pressures
Organon's revenue contracted 2.3% year-over-year in 2026Q2, marking the fifth consecutive quarter of decline, according to the latest income statement data, with China VBP and biosimilar pricing eroding legacy sales.
The revenue trajectory remains firmly negative, with the -2.3% YoY decline in 2026Q2 following -3.5% in 2026Q1 and -5.3% in 2025Q4. While the rate of decline has moderated from the trough, the absence of any positive quarter since 2024Q3 suggests the portfolio is still in structural retreat. The Established Brands segment, heavily exposed to China's Volume-Based Procurement, appears to be the primary drag, while Women's Health and Biosimilars have not yet offset the losses. Investors should monitor whether the Hadlima launch can generate enough incremental volume to stabilize the top line.
Gross Margin Erosion Reflects Pricing Power Loss
Gross margin fell to 54.4% in 2026Q2 from 59.0% in 2024Q1, a 460 basis point decline, as reported in financial statements, indicating that pricing pressure in Established Brands and biosimilars is overwhelming product mix benefits.
The gross margin trend is unmistakably downward, with each quarter since 2024Q1 showing a step-down, interrupted only by a slight uptick in 2025Q3. This erosion suggests that Organon is losing pricing power in its higher-margin segments, particularly as biosimilar competition intensifies and China's VBP forces deeper discounts. The 54.4% gross margin is now well below the peer average, and if this trajectory continues, it could compress operating margins further, leaving less room to service debt.
Operating Leverage Turns Negative as Costs Persist
Operating income in 2026Q2 fell to $323 million, down from $414 million in 2024Q1, despite only a 6% revenue decline, based on reported figures, indicating that fixed costs are not flexing downward with sales.
The operating margin has contracted from 25.5% in 2024Q1 to 20.7% in 2026Q2, a decline of nearly 500 basis points, while revenue fell only about 6% over the same period. This implies that SG&A and R&D expenses are not being scaled back proportionally, likely due to the fixed-cost nature of the global commercial infrastructure and ongoing investment in biosimilar launches. The lack of operating leverage is concerning because it means that even modest revenue declines translate into disproportionate profit erosion, leaving little buffer for debt service.
Net Income Volatility Masks Underlying Cash Generation
Net income swung from a $205 million loss in 2025Q4 to a $108 million profit in 2026Q2, with EPS fluctuating between -$0.79 and $0.55, as per income statement data, suggesting significant non-operating items and tax effects.
The earnings quality is poor, with net margin swinging from -13.6% to 10.0% within two quarters, driven by items that appear unrelated to core operations. The 2025Q4 loss likely includes impairment or one-time charges, while the 2026Q2 profit may benefit from tax adjustments. Stock-based compensation has been consistently positive (except for a negative $19 million in 2026Q2), which is unusual and warrants investigation. Investors should focus on adjusted EBITDA and cash flow metrics rather than reported net income to assess the underlying profitability.
SG&A Discipline Falters as R&D Cuts Raise Concerns
SG&A expenses rose to $434 million in 2026Q2 from $431 million in 2024Q1, while R&D spending fell to $90 million from $112 million, according to reported figures, indicating cost control is uneven and pipeline investment is being trimmed.
The cost structure reveals a troubling pattern: SG&A has remained stubbornly high, hovering around $420-450 million per quarter, even as revenue declines, suggesting limited flexibility in the commercial organization. Meanwhile, R&D has been cut by nearly 20% from its 2024Q1 level, which may indicate that management is prioritizing debt reduction over long-term growth. This underfunding of the biosimilar pipeline could jeopardize future revenue streams, as the company needs new products to offset the decline in Established Brands.
Leverage and Pricing Pressure Threaten Solvency
With a debt-to-equity ratio of 11.70 and net margin of just 3.01%, Organon's thin profitability leaves little room for error, as per the latest financial snapshot, making it vulnerable to interest rate hikes and further price cuts.
The bear case for Organon is compelling: the company carries an extreme debt load, and its net margin is razor-thin, meaning that any adverse development—whether a spike in interest rates, a deeper China VBP round, or a failed biosimilar launch—could push it into losses. The negative revenue growth and gross margin erosion suggest that the core business is deteriorating faster than management can deleverage. Short-sellers would argue that the market is overestimating the durability of the Established Brands franchise and underestimating the risk of a liquidity event if cash flows fail to meet debt service requirements.