Aurobindo Pharma achieves record revenue in Q3 FY25 despite profit decline

Aurobindo Pharma Limited has reported its highest-ever quarterly revenue for the third quarter of fiscal year 2025, underlining its strong position in the global pharmaceutical landscape. The company’s consolidated financial results reflect an 8.5% year-on-year (YoY) increase in revenue from operations, reaching ₹7,979 crore. This growth was driven by robust performances across key markets, particularly Europe and emerging growth markets, which offset a slight decline in the United States and Active Pharmaceutical Ingredients (API) revenues.

Despite the impressive quarterly revenue growth, the company experienced a 10% YoY decline in net profit, which stood at ₹846 crore. This was largely attributed to increased investments in research and development (R&D) and a shift in product mix. Nonetheless, Aurobindo Pharma’s strategic focus on diversifying its product portfolio and expanding its specialty and injectable business segments continues to strengthen its market position.

What drove Aurobindo Pharma’s quarterly revenue growth in Q3 FY25?

The company’s pharma business performance was shaped by dynamic market conditions, with Europe emerging as a key growth driver. European formulations revenue surged by 22.7% YoY to ₹2,121 crore, accounting for 26.6% of Aurobindo Pharma’s consolidated revenue. This growth was supported by strong demand for generic drugs and successful new product launches across key European markets.

Growth markets also delivered exceptional results, with revenue climbing 39.3% YoY to ₹873 crore. This performance highlights Aurobindo Pharma’s strategic penetration into emerging economies, where increasing healthcare investments and demand for affordable medicines are fuelling growth. The anti-retroviral (ARV) segment was another standout performer, recording a 71.2% YoY increase in revenue to ₹307 crore, driven by expanded access to HIV treatments in global health programs.

However, the US market, which remains Aurobindo Pharma’s largest revenue contributor at 46% of consolidated sales, saw a modest decline. US formulations revenue fell by 2.3% YoY to ₹3,671 crore, reflecting a decrease in transient product sales. Despite this setback, the company remains optimistic about its US operations, bolstered by recent product approvals and pipeline developments.

How did product approvals and regulatory milestones impact Aurobindo Pharma’s performance?

Regulatory approvals played a pivotal role in Aurobindo Pharma’s pharma business performance during the quarter. The company secured final approval for eight Abbreviated New Drug Applications (ANDAs) from the US Food and Drug Administration (USFDA), including one specialty injectable. Additionally, Aurobindo Pharma filed four new ANDAs, bringing its cumulative USFDA filings to 853, with 678 final approvals and 26 tentative approvals to date.

These regulatory milestones reflect Aurobindo Pharma’s robust R&D capabilities, with the company investing ₹450 crore in R&D during the quarter, representing 5.6% of its revenue. This strategic focus on research has enabled the company to diversify its product portfolio, targeting high-margin therapeutic areas such as oncology, cardiovascular diseases, and central nervous system disorders.

Among the key product approvals were antidiabetic drugs like Metformin Hydrochloride Extended-Release Tablets and oncology treatments such as Pazopanib Tablets. These approvals not only strengthen Aurobindo Pharma’s US product portfolio but also enhance its competitive position in global pharmaceutical markets.

What are the financial highlights of Aurobindo Pharma’s Q3 FY25 performance?

Aurobindo Pharma’s financial performance in Q3 FY25 showcased both growth and resilience. The company’s EBITDA before R&D expenses stood at ₹2,056 crore, with a margin of 25.8%. EBITDA before forex and other income was ₹1,628 crore, reflecting a 20.4% margin. While these figures indicate strong operational efficiency, the company faced margin pressures due to increased R&D spending and fluctuations in product mix.

API revenue declined slightly by 1.6% YoY to ₹1,006 crore, indicating challenges in global API pricing and competitive pressures. Despite this, Aurobindo Pharma’s diversified revenue streams across formulations, APIs, and ARVs provided a stable foundation for sustained growth.

Net profit for the period was ₹846 crore, down from ₹940 crore in the same quarter last year. This decline was primarily driven by higher R&D investments and foreign exchange fluctuations. However, on a quarter-on-quarter basis, net profit increased by 3.5%, reflecting operational improvements and cost optimisation measures.

What is Aurobindo Pharma’s outlook for the future?

Looking ahead, Aurobindo Pharma is well-positioned to sustain its quarterly revenue growth trajectory through strategic investments in R&D, product diversification, and geographic expansion. The company aims to strengthen its specialty and injectable drug segments, which offer higher margins and growth potential.

Vice-Chairman and Managing Director K. Nithyananda Reddy expressed confidence in the company’s future prospects, stating, “Our record-breaking consolidated financial results highlight the strength of our diversified portfolio and global footprint. We are committed to enhancing our manufacturing capabilities and expanding our specialty business to drive long-term profitability.”

The company’s focus on regulatory compliance, operational efficiency, and product innovation will be key drivers of its future success. Additionally, Aurobindo Pharma’s strong presence in over 150 countries and its extensive product pipeline position it to capitalise on emerging opportunities in the global pharmaceutical industry.