Novo Nordisk (NVO) is on pace to gap lower at the opening bell today, with shares of the pharma giant plunging up to 30% in premarket trading following its second forecast cut of 2025. The Danish drug company drastically reduced its full-year sales growth guidance to 8-14% from 13-21%, while operating profit growth expectations were lowered to 10-16% from 16-24%.
Why Did Novo Nordisk Slash Its Forecast?
The slashed guidance stems primarily from weaker performance expectations for both Wegovy in the U.S. obesity market and Ozempic in the U.S. GLP-1 diabetes market, coupled with disappointing penetration rates in international markets. Novo Nordisk continues to face significant challenges from persistent unauthorized compounding of GLP-1 drugs, despite the expiry of the FDA grace period in May 2025.
In response to these challenges, the company is actively pursuing multiple strategies, including litigation, to protect patients from knockoff semaglutide drugs while calling for aggressive intervention from federal and state regulators. Notably, Novo Nordisk has also tapped Mike Doustdar to succeed Lars Fruergaard Jørgensen as CEO effective Aug. 7.
Inside Novo Nordisk’s Preliminary Results
Taking a deeper look into the preliminary results, the company's core business showed some resilience, with sales rising 18% year-on-year in both Q2 and the first half of 2025, while operating profit increased by 40% in Q2. That said, management expects significant deceleration in the second half of the year, primarily due to mounting competitive pressures from rival Eli Lilly (LLY) and ongoing issues with counterfeit products.
Looking ahead, NVO’s pipeline includes promising developments such as amycretin, with phase 3 trials for an oral version expected to begin early next year. The European drug-loss giant is slated to release its full Q2 results on Aug. 6.
While NVO maintains strong profit margins of 35% and trades at an attractive valuation of about 17 times forward earnings, prospective buyers should weigh today’s deep “discount” on the stock carefully against the context of increasing competition in the obesity drug market and significant regulatory hurdles.
NVO Plunges in Premarket Trading
The market's dramatic reaction has effectively erased significant gains achieved during the previous Ozempic-driven rally in 2024, which boosted Novo Nordisk to the position of Europe's most valuable listed company.
NVO is down 19% ahead of the bell at last check. The pharma stock is on pace to break beneath its lower Bollinger Band, with the 14-day Relative Strength Index (RSI) set to drop below the unofficial “oversold” threshold at 30.
Investors who bought the dip the last time NVO was this oversold, back in April, were able to catch a nice rebound up to the recent June highs around $80. However, jumping into the drug stock’s post-event slide today likely requires a higher-than-usual tolerance for volatility.
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