Novartis (NOVN.S): 3Q26 First take: Cost control continues to drive earnings momentum, guidance upgrade suggests 2% upside risk to Core Operating Profit

Novartis reported 3Q26 results with net sales broadly in line ($14,522mn vs. consensus $14,452mn) and core operating profit 8% above consensus at $6,036mn (+$454mn), driven by substantially lower costs than expected: COGS 2% below consensus ($73mn), SG&A 10% below ($334mn) and R&D 4% below ($129mn), despite prior commentary on increasing cost phasing in 2H and incremental R&D investment. Cosentyx (+4%/$67mn, price), Ilaris (+12%/$66mn) and Zolgensma (+13%/$45mn, Itvisma launch) beat, offsetting misses in Pluvicto (-8%/-$56mn on timing of new indication ramp), Kisqali (-1%/-$23mn) and Scemblix (-2%/-$13mn). Novartis upgraded FY26 core operating profit guidance to in-line to low-single-digit CER growth (from low-single-digit decline) while reiterating net sales guidance;