Novo Nordisk stock has had a dismal year, slumping by more than 20% as investors worry about declining sales of GLP-1 drugs and the threat posed by the pharma company's arch-rival Eli Lilly.
But the Danish drugmaker finally gave the market a reason to feel hopeful on Wednesday when it posted strong third-quarter earnings, as sales of the Wegovy weight-loss pill topped the Street's expectations.
Novo's American depositary receipts jumped 6.1% to $42.64 ahead of the opening bell. They were down 21% for the year through Tuesday's close.
The earnings beat was partly down to the Wegovy pill, which is now available in eight markets including the U.S., Germany, the U.K., and the United Arab Emirates.
The oral treatment is seen as a crucial growth driver for Novo, because it could open up a new market of weight-loss drug users who don't want an injection. Sales for the pill clocked in at 5.39 billion Danish krone ($810 million). Analysts polled by FactSet were expecting kr4.55 billion.
Novo reported an adjusted operating profit of kr31.7 billion for the quarter, as sales rose 6% from a year ago to kr79.2 billion. Wall Street was looking for a profit of kr28.7 billion on sales of kr73.6 billion.
The company also raised its full-year outlook. It said it now expects adjusted operating profit growth of between negative-2% and 2% at constant exchange rates, citing strong demand for its GLP-1 drugs.
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