Johnson & Johnson faces earnings test after health-care stock rebound

Johnson & Johnson heads into Wednesday’s second-quarter earnings report with its stock near record territory, giving investors a clear test: can the company’s business results support a rally that has partly come from a broader move into health care?

Shares have risen more than 14% since the start of June through Monday’s close, according to CNBC’s Investing Club, helped by a rotation away from AI infrastructure winners and into health-care names that had lagged earlier in the year. A rotation means investors are shifting money from one group of stocks to another, often because they want different risk exposure.

Health care is often viewed as defensive, meaning demand for many products and services tends to hold up better when markets get shaky. CNBC reported that the S&P 500 health-care sector was up 8.7% since June began through Monday, while a basket of chip stocks had fallen 2.7% over the same period.

J&J’s move has cooled in recent sessions. CNBC said the stock gave back a few percentage points alongside the broader health-care group as the Iran war weighed on parts of the market outside energy and technology. A weak preliminary report from hospital operator HCA Healthcare also pressured the group Tuesday.

Drug sales are the main focus

The biggest number to watch is Darzalex, J&J’s top-selling medicine. The blood-cancer therapy generated $3.96 billion in first-quarter sales, up 18% excluding foreign-exchange benefits, according to the company figures cited by CNBC. FactSet consensus calls for second-quarter Darzalex sales of $4.24 billion, which would represent 19.8% growth from a year earlier.

J&J CEO Joaquin Duato called Darzalex the “gold standard” for multiple myeloma treatment on the company’s April earnings call. In a May CNBC interview, Duato said the company has a goal of becoming the No. 1 oncology company by 2030.

Carvykti, another J&J multiple myeloma treatment, is smaller but growing faster. CNBC reported that Carvykti sales rose 57% last quarter to $597 million, while analysts expect second-quarter revenue of $654 million, up 49%. Carvykti is a personalized therapy designed to help a patient’s immune system attack cancer cells.

Investors will also watch Tremfya, J&J’s second-largest drug after Darzalex. Tremfya treats plaque psoriasis, psoriatic arthritis and inflammatory bowel disease. The drug belongs to a class called IL-23 inhibitors, which target an immune-system pathway tied to inflammation. Sales rose 64% in the first quarter to $1.6 billion, and FactSet consensus points to $1.78 billion in the second quarter, according to CNBC.

A newer medicine, Icotyde, may get attention even if it does not yet contribute much revenue. CNBC reported that the Food and Drug Administration approved the daily pill in mid-March for moderate to severe plaque psoriasis. Goldman Sachs analysts said in a recent client note that their expert survey supported J&J’s view that Icotyde could eventually reach at least $10 billion in annual sales, though they also said J&J may not break out the drug’s revenue this early in the launch.

Devices and Stelara decline add context

J&J’s Innovative Medicine segment, its pharmaceutical business, produced about two-thirds of the company’s $94 billion in 2025 revenue, according to CNBC. MedTech, which includes medical devices and surgical products, made up the rest.

Innovative Medicine grew 7.4% in the first quarter, compared with 4.6% growth in MedTech, CNBC reported. One drag is Stelara, a former blockbuster that lost exclusivity in 2025 and now faces cheaper biosimilar competition. Biosimilars are near-copy versions of complex biologic drugs. Stelara revenue fell 62% in the first quarter to $656 million, and Wall Street expects a similar decline for the second quarter, according to FactSet.

RBC Capital analyst Shagun Singh told CNBC she will focus on Innovative Medicine growth excluding Stelara. She also pointed to J&J’s exposure to non-elective care, saying, “If you get a heart attack, you have to go there. If you have cancer, you have to take your drugs.” RBC has a buy-equivalent rating and a $265 price target on the stock, according to CNBC.

Within MedTech, cardiovascular care grew 10.5% last quarter, ahead of surgery, vision and orthopaedics, CNBC reported. The device results may draw extra scrutiny after HCA Healthcare warned Tuesday about lower surgical procedure volume.

FactSet data cited by CNBC shows the average analyst price target near $254, close to where J&J traded Tuesday afternoon, while nearly 70% of analysts covering the stock have buy-equivalent ratings. Jim Cramer said Tuesday on CNBC’s Morning Meeting that he wanted more information before making a fresh call on the stock ahead of earnings.

This story draws on original reporting from CNBC.