Biotechnology company United Therapeutics (NASDAQ: UTHR) reported Q1 CY2025 results topping the market’s revenue expectations, with sales up 17.2% year on year to $794.4 million. Its GAAP profit of $6.63 per share was 5.1% above analysts’ consensus estimates.
Is now the time to buy United Therapeutics? Find out by accessing our full research report, it’s free.
United Therapeutics (UTHR) Q1 CY2025 Highlights:
- Revenue: $794.4 million vs analyst estimates of $730 million (17.2% year-on-year growth, 8.8% beat)
- EPS (GAAP): $6.63 vs analyst estimates of $6.31 (5.1% beat)
- Operating Margin: 48.2%, down from 52.6% in the same quarter last year
- Market Capitalization: $13.51 billion
“2025 is off to a tremendous start as we reported yet another quarter of record revenue,” said Martine Rothblatt, Ph.D., Chairperson and Chief Executive Officer of United Therapeutics.
Company Overview
Founded by a mother seeking treatment for her daughter's pulmonary arterial hypertension, United Therapeutics (NASDAQ: UTHR) develops and commercializes medications for chronic lung diseases and other life-threatening conditions, with a focus on pulmonary hypertension treatments.
Sales Growth
Examining a company’s long-term performance can provide clues about its quality. Any business can experience short-term success, but top-performing ones enjoy sustained growth for years. Luckily, United Therapeutics’s sales grew at a solid 15.7% compounded annual growth rate over the last five years. Its growth beat the average healthcare company and shows its offerings resonate with customers, a helpful starting point for our analysis.
We at StockStory place the most emphasis on long-term growth, but within healthcare, a half-decade historical view may miss recent innovations or disruptive industry trends. United Therapeutics’s annualized revenue growth of 22.9% over the last two years is above its five-year trend, suggesting its demand was strong and recently accelerated. 
This quarter, United Therapeutics reported year-on-year revenue growth of 17.2%, and its $794.4 million of revenue exceeded Wall Street’s estimates by 8.8%.
Looking ahead, sell-side analysts expect revenue to remain flat over the next 12 months, a deceleration versus the last two years. This projection is underwhelming and implies its products and services will see some demand headwinds. At least the company is tracking well in other measures of financial health.
Today’s young investors won’t have read the timeless lessons in Gorilla Game: Picking Winners In High Technology because it was written more than 20 years ago when Microsoft and Apple were first establishing their supremacy. But if we apply the same principles, then enterprise software stocks leveraging their own generative AI capabilities may well be the Gorillas of the future. So, in that spirit, we are excited to present our Special Free Report on a profitable, fast-growing enterprise software stock that is already riding the automation wave and looking to catch the generative AI next.
Operating Margin
Operating margin is an important measure of profitability as it shows the portion of revenue left after accounting for all core expenses – everything from the cost of goods sold to advertising and wages. It’s also useful for comparing profitability across companies with different levels of debt and tax rates because it excludes interest and taxes.
United Therapeutics has been a well-oiled machine over the last five years. It demonstrated elite profitability for a healthcare business, boasting an average operating margin of 45.7%.
Analyzing the trend in its profitability, United Therapeutics’s operating margin rose by 22.8 percentage points over the last five years, as its sales growth gave it immense operating leverage. Zooming into its more recent performance, however, we can see the company’s margin has decreased by 2.4 percentage points on a two-year basis. Given its business quality, we’re optimistic that United Therapeutics can correct course and return to expansion.
In Q1, United Therapeutics generated an operating profit margin of 48.2%, down 4.4 percentage points year on year. This contraction shows it was less efficient because its expenses grew faster than its revenue.
Earnings Per Share
Revenue trends explain a company’s historical growth, but the long-term change in earnings per share (EPS) points to the profitability of that growth – for example, a company could inflate its sales through excessive spending on advertising and promotions.
United Therapeutics’s astounding 15.9% annual EPS growth over the last five years aligns with its revenue performance. This tells us its incremental sales were profitable.
In Q1, United Therapeutics reported EPS at $6.63, up from $6.17 in the same quarter last year. This print beat analysts’ estimates by 5.1%. Over the next 12 months, Wall Street expects United Therapeutics’s full-year EPS of $25.06 to grow 9.7%.
Key Takeaways from United Therapeutics’s Q1 Results
We were impressed by how significantly United Therapeutics blew past analysts’ revenue expectations this quarter. We were also happy its EPS outperformed Wall Street’s estimates. Zooming out, we think this was a solid quarter. The stock traded up 2% to $305.90 immediately after reporting.
Indeed, United Therapeutics had a rock-solid quarterly earnings result, but is this stock a good investment here? The latest quarter does matter, but not nearly as much as longer-term fundamentals and valuation, when deciding if the stock is a buy. We cover that in our actionable full research report which you can read here, it’s free.
