Bayer's Pharma Engine Roars While Crop Science Drags the Other Way

Bayer's third-quarter 2026 report card reads less like a single story than two diverging ones. The drug unit is firing on all cylinders, led by two medicines whose sales are climbing at a pace most of the industry would envy. The agricultural division is heading in the opposite direction. Between those poles sits a group whose headline numbers look sturdy but whose underlying momentum is far from uniform.

Group revenue for the quarter came in at EUR 10.053 billion, with EBITDA before special items of EUR 1.615 billion. Adjusted earnings per share reached EUR 0.31. Those figures landed yesterday and were followed today by a fresh round of analyst revisions — and a 4.5% jump in the share price.

Two products carry the drug business

Pharmaceuticals generated EUR 4.680 billion in revenue. On a currency- and portfolio-adjusted basis, that marked a 6.4% advance. The engine behind the gain was unmistakable: Nubeqa, the cancer treatment, posted growth of 58.3%, while Kerendia, used against kidney and heart disease, added 64.9%.

Profitability in the division outpaced the top line. EBITDA before special items climbed 23.6% to EUR 1.292 billion, a sign that the sales surge is translating into real earnings power rather than being eaten up by costs. Management pointed squarely at demand for those two medicines as the main driver of the recovery — and, by extension, of its confidence in the division's medium-term contribution.

That confidence showed up in the guidance. Bayer now expects a margin before special items of 25–27% for Pharmaceuticals in 2026. Reuters reported that the drug unit's better-than-expected performance was what tipped the company into raising its full-year profit outlook. For the group as a whole, Bayer projects currency-adjusted EBITDA before special items of EUR 9.8 billion to EUR 10.3 billion. Free cash flow guidance was lifted to between minus EUR 1.5 billion and minus EUR 0.5 billion — an improvement, but still firmly in negative territory.

Agriculture is the counterweight

Crop Science told the reverse story. Revenue fell 2.4% on a currency- and portfolio-adjusted basis to EUR 3.884 billion, while segment EBITDA dropped 41.3%. The earnings decline was far sharper than the sales shortfall, meaning the division is losing profitability faster than it is losing volume — the mirror image of what is happening in Pharma.

Consumer Health offered no compensating spark. Revenue of EUR 1.445 billion amounted to a currency- and portfolio-adjusted gain of just 0.1%, and EBITDA slipped 4.4% to EUR 347 million.

The pattern is plain: operating momentum sits almost entirely with the medicines business. A genuinely broad-based turnaround would require the other divisions to start pulling their weight again, and the latest quarter does not yet make that case.

The Street is not of one mind

Goldman Sachs raised its target to EUR 66 from EUR 63.50 today, keeping a buy rating. UBS moved in the same direction, lifting its target to EUR 66 from EUR 62 and reaffirming its buy call, as reported by dpa-AFX. Both houses adjusted their marks after the quarterly release without touching their recommendations, and other positive bank assessments now cluster in the EUR 60 to EUR 66 range.

Yet the bullish chorus is not unanimous. BMO Capital restated a neutral stance, leaving a more cautious view on the table even as the drug data impress.

For investors, the dividing line is straightforward. Nubeqa and Kerendia offer hard evidence of growth, and the raised margin target gives that evidence a profit dimension. Whether it amounts to a durable recovery for the whole company depends on Crop Science and Consumer Health — and on that front, the quarter delivered declines, not answers.