Elanco Animal Health Incorporated  reported first-quarter 2025 adjusted earnings per share of 37 cents. That’s up 9% year over year.

The company beat the management guidance of 29 to 34 cents and the consensus of 31 cents.

Elanco reported sales of $1.19 billion. It beat the consensus of $1.17 billion and the management guidance of $1.16 billion-$1.18 billion.

Sales decreased 1% on a reported basis and increased 4% on organic constant currency growth.

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Pet Health revenue was $635 million. That’s a decrease of 1% on a reported basis. However, it’s an increase of 1% when excluding foreign exchange rates, including a 2% increase from price, compared to the first quarter of 2024.

The year-over-year volume decline in the first quarter was primarily driven by a challenging U.S. retail environment in the first quarter of 2025, and decreased vaccine sales in the U.S., mainly offset by increased sales of new products and continued strong demand for parasiticide products in Europe.

The Advantage Family of products and Seresto contributed revenue of $123 million and $153 million, respectively. 

Farm Animal revenue was $546 million, a decrease of 2% on a reported basis, or an increase of 7% when excluding the unfavorable impacts from the aqua divestiture and foreign exchange rates, driven by a 3% increase from price.

First quarter volumes were up 4%, primarily driven by strength in U.S. cattle, led by Experior.

Adjusted EBITDA was $276 million, a decrease of 6%. Adjusted EBITDA margin was 23.1% compared to 24.4% a year ago.

As of March 31, Elanco’s net leverage ratio was 4.4x adjusted EBITDA, an increase of 0.1x compared to December 31, 2024, and expects gross debt paydown of $450 million-$500 million in 2025.

Guidance: “We are raising our 2025 full-year revenue guidance and maintaining our adjusted EBITDA and adjusted EPS ranges, reflecting our strong first quarter execution, recent momentum and more favorable foreign exchange rates, balanced by expected tariff impact and a cautious approach in an uncertain macroeconomic environment,” said .

Tariffs: Elanco is taking “several intervention actions” that will position the company to cover potential impacts with or without the pharmaceutical exemption, CFO Todd Young said.

While we are taking a prudent approach to the balance of the year given the dynamic macroeconomic backdrop, our durable portfolio and solid momentum bolster our confidence in sequential acceleration of revenue growth to deliver our 2025 goals while creating long-term value for shareholders and society,” said Jeff Simmons, President and CEO.

Elanco Animal Health ( ELAN ) raises fiscal 2025 revenue guidance from $4.45 billion-$4.51 billion to $4.51 billion-$4.58 billion versus the consensus of $4.484 billion.

Elanco Animal reaffirms its 2025 adjusted EPS of 80-86 cents versus the consensus of 83 cents.

What’s Next: Elanco expects second-quarter 2025 adjusted earnings of 17-21 cents compared to the consensus of 25 cents, with sales of $1.175 billion-$1.195 billion compared to the consensus of $1.17 billion.

Price Action: ELAN stock is up 17.4% at $11.17 at the last check Wednesday.

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