Why is Johnson & Johnson stock tumbling 7% today?

Johnson & Johnson's stock fell 6.8% in early trading, closing at $245.91 after releasing its Q3 2026 earnings report. The company's GAAP net earnings dropped 95.9% year-over-year to $210 million, or $0.09 per diluted share, due to a significant $5.5 billion pre-tax charge. This charge resulted from proposed talc litigation settlements, the acquisition of Firefly Bio, and a strategic collaboration with Sail Biomedicines.

Despite adjusted EPS of $2.59 surpassing the $2.53 estimate, and revenue of $25.4 billion exceeding expectations, the stock's performance was overshadowed by the massive profit wipeout. The MedTech division's performance, growing only 2.5% to $8.6 billion, missed analyst estimates, marking two consecutive quarters of underperformance.

CFO Joe Wolk attributed MedTech's decline to the Middle East conflict, European government austerity, and pricing pressure in China. Oncology drug sales in the Innovative Medicine segment also fell short of estimates, while Tremfya sales surged 68%. The company raised its full-year guidance, but the broader market's negative tone and other medical device companies' declines added to the pressure, leading to a sharp sell-off and the stock reaching its intraday low of $245.19.