How BMY (Bristol-Myers Squibb Company) Makes Money in 2026: A Deep-Dive With Income Statement

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Understanding how a pharmaceutical giant like Bristol Myers Squibb makes money is essential for investors and anyone interested in the business of biotech and oncology. In this post, we break down Bristol Myers Squibb's quarterly income statement (Q4 2025) using a Sankey chart to visualize the financial flows — what comes in, where it goes, and what's left as profit.

Quick Bristol Myers Squibb Overview

Bristol Myers Squibb operates as a global biopharmaceutical company focused on discovering, developing, and delivering innovative medicines for serious diseases, particularly in oncology, hematology, immunology, cardiovascular, and neuroscience. Revenue comes primarily from Net Product Revenue from blockbuster drugs like Eliquis, Opdivo, and Revlimbril. The company also generates smaller contributions from alliance partnerships and other revenue streams.

Revenue Breakdown

• Total Revenue (Q4 2025): $12.5B (+1.3% YoY)
  • Net Product Revenue: $12.1B (96.9% of total)
  • Alliance & Other Revenue: $0.391B (3.1% of total)
  • Growth is powered by strong demand for oncology and immunology products, despite a decline in alliance revenue.

Gross Profit and Margins

• Gross Profit: $8.405B (67.2% gross margin)
  • Cost of Revenue: $4.097B (+-14.9% YoY)
  • Bristol Myers Squibb maintains robust margins due to its asset-light model post-patent cliffs, manufacturing efficiencies, and high pricing power in branded pharmaceuticals.
• Most costs come from manufacturing and distribution of biologics, raw materials for drug production, and royalties.

Operating Income and Expenses

• Operating Income: $1.419B (+0.0% YoY, 11.4% margin)
• Operating Expenses: $6.986B (+-7.2% YoY)
  • R&D: $2.586B (+-19.7% YoY, 20.7% of revenue) — focused on advancing pipeline in oncology, cell therapy, and immunology, including trials for next-gen cancer immunotherapies
  • SG&A: $2.181B (+2.1% YoY, 17.4% of revenue) — covering sales force expansion, marketing for key drugs, and administrative overhead
  • Bristol Myers Squibb continues to prioritize innovation while maintaining efficiency through cost controls and pipeline prioritization.

Net Income

• Pre-Tax Income: $1.470B (+740.0% YoY, 11.8% margin)
• Income Tax: $0.384B (26.1% effective tax rate)
• Net Income: $1.086B (+1,408.3% YoY, 8.7% net margin)
• Bristol Myers Squibb converts a significant portion of sales into profit due to scalability of its blockbuster portfolio, operational efficiencies, and pricing power.

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What Drives Bristol Myers Squibb's Money Machine?

• Net Product Revenue: 96.9%+ of revenue from sales of patented drugs like Opdivo (oncology), Eliquis (anticoagulant), and Orencia (immunology)
• Pipeline Productivity: R&D investments support over 50 clinical programs, driving future blockbusters despite high spend
• Strategic Acquisitions: Investments in cell therapy (e.g., Karuna Therapeutics) and partnerships bolster long-term revenue
• Future growth areas: Next-gen modalities like bispecific antibodies and ADCs, though not yet profitable

Visualizing Bristol Myers Squibb's Financial Flows

The Sankey chart below visualizes how each dollar flows from gross revenue, through costs and expenses, down to net income. This helps investors spot where value is created, what areas weigh on profits, and how efficiently the company operates.

• Most revenue flows into gross profit, with operating expenses (especially R&D) taking the largest chunk.
• Even after large investments in R&D, 8.7% of revenue drops to the bottom line.

Key Takeaways

• Bristol Myers Squibb's money comes overwhelmingly from Net Product Revenue
• High gross and net margins illustrate the power of Bristol Myers Squibb's patent-protected pharmaceutical portfolio
• Heavy investment in R&D, balanced by efficiency in operating costs
• Ongoing growth is driven by oncology pipeline and key drug demand

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FAQ About Bristol Myers Squibb's Income Statement

1. What is the main source of Bristol Myers Squibb's revenue in 2025?

Bristol Myers Squibb generates over 96.9% of its revenue from Net Product Revenue. Alliance & Other Revenue contributes the remaining 3.1%.

2. How profitable is Bristol Myers Squibb in Q4 2025?

Bristol Myers Squibb reported net income of $1.086B in Q4 2025, with a net margin of approximately 8.7%, reflecting strong profitability driven by high gross margins and cost discipline.

3. What are the largest expense categories for Bristol Myers Squibb?

The biggest expenses on Bristol Myers Squibb's income statement are operating expenses, particularly Research & Development (R&D) and Sales, General & Administrative (SG&A) costs. R&D investment reached $2.586B in Q4 2025, as Bristol Myers Squibb prioritizes oncology and immunology pipeline advancement.

4. Why does Alliance & Other Revenue operate at a loss?

Alliance & Other Revenue, despite generating $391M in revenue, faces pressures from partnership dynamics, posting variability with -26.4% YoY growth in Q4 2025. This is because Bristol Myers Squibb aggressively invests in strategic collaborations, believing these will drive long-term growth—even if the segment is unprofitable today.

5. How does Bristol Myers Squibb's effective tax rate compare to previous years?

Bristol Myers Squibb's effective tax rate in Q4 2025 was 26.1%, consistent with previous years. This moderate rate is primarily due to international operations and standard pharmaceutical tax structuring.