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Cash, and What It BuysNarrow moat

Gilead Sciences (GILD) — moat facet

Gilead turns its HIV annuity into $9.5 billion of free cash a year and has spent much of it on acquisitions that wrote off billions.

Gilead's franchise produces cash reliably; the question for an owner is what becomes of it. Free cash flow was $9,456 million in 20251. Of that, $4,003 million went to dividends and $1,922 million to buybacks2. The rest, and a good deal more, has gone to acquisitions.

Gilead uses of free cash flow, 2025 ($bn)9.5Free cash flow4.0Dividends1.9Buybacks3.5Left overGilead Q4 2025 results release; SEC XBRL dividends and repurchases
Most of the cash goes to owners; the deals come on top.

Acquisitions are where the record is uneven. Gilead paid $11,155 million for Kite in 20173, $20.6 billion for Immunomedics in 20204 and about $4.7 billion for Forty Seven5. It has since written off about $8.65 billion of the $15.8 billion of Immunomedics IPR&D it recorded6. In the first half of 2026 it spent $11.3 billion on Arcellx, Tubulis and Ouro7. The root page on acquisitions covers the record in full.

The result shows in the returns. Return on invested capital was 77.5% in 2015 and has been between 2.8% and 22.7% since 20188. Part of that is the end of the hepatitis C windfall; part is the cost of what was bought to replace it.

The capital facet is narrow because the cash is real and the use of it uneven. The dividend and buybacks are sound; the acquisitions have produced some of the largest write-offs in the company's accounts.

The market's view of the capital record is visible in one comparison. Gilead's year-end market value was $145.83 billion in 2015 and was not exceeded at a year end until 2025, when it reached $152.28 billion9. A decade of free cash flow, dividends and acquisitions left the company worth about what it was at the hepatitis C peak, with the gain arriving only in the last two years.

The test is whether the 2026 purchases earn their price. If the Arcellx therapy anito-cel, approved or not by its December 2026 date, is not selling more than $1 billion a year by 2029, the latest round will have repeated Immunomedics.

Moat trajectory: Narrowing

Net debt $23.1bn after $11.3bn of acquisitions in H1 2026.

The number that tests this moat
Third-party estimate
Free cash flow, trailing twelve months
$12.94bn (to June 2026), from $9,456M for 2025

The cash available to owners and deals; the trailing figure includes a strong first half.

Source: Gilead Sciences statistics (stockanalysis) ↗
Aspects of the moat
DIG DEEPER 01
Nine and a Half Billion of Free Cash Flow
Gilead produced $9.5 billion of free cash flow in 2025 and $5.9 billion in the first half of 2026, a half in which it reported an $8.5 billion loss.
DIG DEEPER 02
Eleven Years of Dividends, Ten of Increases
Gilead has raised its dividend every year since starting in 2015, from $1.29 to $3.16, and paid it from cash flow even when profit vanished.
DIG DEEPER 03
Buybacks That Hold the Count Flat
Gilead's buybacks now merely hold its share count near 1,255 million, after $21 billion spent at the 2015-2016 peak.
DIG DEEPER 04
Twenty-Six Billion of Debt
Gilead's net debt rose from $14.3 billion to $23.1 billion in six months, about 2.4 years of free cash flow.
⚠ Threats to the moat
⚠ THREAT 01
Equity Halved in Six Months
Gilead's equity fell 48% in six months as $11.3 billion of acquired research was expensed.
⚠ THREAT 02
Returns Fell With the Cure
Gilead's return on invested capital fell from 77.5% in 2015 to between 2.8% and 22.7% since 2018, dragged down in acquisition years.
References
  1. ReportedFree cash flow was $9,456 million in 2025.
    Gilead Sciences fourth-quarter and full-year 2025 results release, Form 8-K exhibit 99.1 - non-GAAP measures, free cash flow, cash and 2026 guidance. — FY2025 · publ. 10 February 2026 · source ↗
  2. ReportedOf that, $4,003 million went to dividends and $1,922 million to buybacks.
    SEC EDGAR XBRL company facts for Gilead Sciences (CIK 882095): revenue 32,639 (2015), 30,390, 26,107, 22,127 (2018); net income attributable 18,108 (2015), 13,501, 4,628, 5,455 (2018); diluted EPS 11.91 (2015), 9.94, 3.51, 4.17; dividends declared per share 1.29 (2015), 1.84, 2.08, 2.28, 2.52, 2.72, 2.84, 2.92; buybacks 10,002 (2015) and 11,001 (2016); acquired IPR&D 939 (2021) and 944 (2022); $ millions. — FY2014-FY2025 · publ. 2026 · source ↗
  3. ReportedGilead paid $11,155 million for Kite in 2017, $20.6 billion for Immunomedics in 2020 and about $4.7 billion for Forty Seven.
    Gilead Sciences Form 10-K for 2018 - the Kite Pharma acquisition at $180 a share ($11,155 million) and product sales of Harvoni and Epclusa for 2016-2018. — FY2018 · publ. February 2019 · source ↗
  4. ReportedGilead paid $11,155 million for Kite in 2017, $20.6 billion for Immunomedics in 2020 and about $4.7 billion for Forty Seven.
    Gilead Sciences Form 10-K for 2020 - the Immunomedics ($20.6 billion) and Forty Seven (about $4.7 billion) acquisitions, acquired IPR&D and the 94.7% effective tax rate. — FY2020 · publ. February 2021 · source ↗
  5. ReportedGilead paid $11,155 million for Kite in 2017, $20.6 billion for Immunomedics in 2020 and about $4.7 billion for Forty Seven.
    Gilead Sciences Form 10-K for 2020 - the Immunomedics ($20.6 billion) and Forty Seven (about $4.7 billion) acquisitions, acquired IPR&D and the 94.7% effective tax rate. — FY2020 · publ. February 2021 · source ↗
  6. Moat Explorer calcIt has since written off about $8.65 billion of the $15.8 billion of Immunomedics IPR&D it recorded.
    Moat Explorer calculation from Gilead Sciences reported figures ($ millions unless stated). HIV and Biktarvy: HIV share of total revenues 20,752 / 29,443 = 70.5% (2025); of product sales 20,752 / 28,915 = 71.8%; 16,438 / 22,449 = 73.2% (2019); 16,315 / 27,305 = 59.8% (2021); 18,175 / 27,116 = 67.0% (2023); 19,612 / 28,754 = 68.2% (2024). Biktarvy share of total revenues 14,334 / 29,443 = 48.7%; of HIV 14,334 / 20,752 = 69.1%; Biktarvy US 11,467 / 14,334 = 80.0%; Biktarvy growth 2025 14,334 / 13,423 - 1 = +6.8%; 2019-2025 14,334 / 4,738 = 3.0 times, (3.03)^(1/6) - 1 = about 20% a year. Other HIV 20,752 - 14,334 = 6,418; HIV other than Biktarvy, Descovy, Genvoya and Odefsey 20,752 - 14,334 - 2,758 - 1,498 - 1,167 = 995; Veklury plus Other plus royalties 911 + 799 + 527 = 2,237. Genvoya 1,498 / 3,931 - 1 = -61.9%. HIV growth 2019-2025 20,752 / 16,438 - 1 = +26.2%, about 4.0% a year; 2021 16,315 / 16,938 - 1 = -3.7%; 2023 18,175 / 17,194 - 1 = +5.7%; 2024 19,612 / 18,175 - 1 = +7.9%; 2025 20,752 / 19,612 - 1 = +5.8%, about 6%; H1 2026 10,723 / 9,675 - 1 = +10.8%; Q2 2026 5,693 / 5,088 - 1 = +11.9%. Descovy 2025 2,758 / 2,113 - 1 = +30.5%, about 31%; Q2 2026 967 / 653 - 1 = +48.1%; Descovy over Yeztugo Q2 2026 967 / 232 = 4.2, about four times. Yeztugo Q1 2026 = H1 397 - Q2 232 = 165; Yeztugo over Biktarvy H1 2026 397 / 7,133 = 5.6%, about 6%. US HIV 16,904 / 20,752 = 81.5%, about 81%; US product sales 20,816 / 28,915 = 72.0%; Europe 4,617 / 28,915 = 16.0%. Gilead HIV growth Q2 2026 +11.9% less ViiV +11% = about +1 point. Exclusivity: Descovy + Vemlidy + Odefsey 2,758 + 1,070 + 1,167 = 4,995, about $5.0bn, / 29,443 = 17.0% of revenue; Descovy + Vemlidy 2,758 + 1,070 = 3,828; Vemlidy share of Liver Disease 1,070 / 3,217 = 33.3%, a third; 2025 sales by primary US patent window: Tecartus 344 + Genvoya 1,498 = 1,842 (2027-2029); Trodelvy 1,397 + Descovy 2,758 + Vemlidy 1,070 + Odefsey 1,167 + sofosbuvir/velpatasvir 1,272 = 7,664 (2028-2033); Biktarvy 14,334 (2036). Hepatitis C 2015 Harvoni 13,864 + Sovaldi 5,276 = 19,140, / product sales 32,151 = 59.5%, about 60%; product sales 2018 21,677 / 32,151 - 1 = -32.6%; Liver Disease 2025 3,217 / 19,140 = 16.8%, about 17%, a sixth. Liver Disease 2019 HCV 2,936 + HBV/HDV 742 = 3,678; 2020 2,064 + 860 = 2,924. Price: gross product sales 2025 28,915 + 19,953 = 48,868, about $48.9bn; 2024 28,610 + 17,776 = 46,386; net product sales growth 28,915 / 28,610 - 1 = +1.1%, about 1%; gross-to-net deductions 19,953 / 17,776 - 1 = +12.2%; accrued rebates 4,337 / 3,892 - 1 = +11.4%, about 11%; rebates and chargebacks over net product sales 17.5bn / 28,915 = 60.5%, about 60% (2025); 15.5bn / 28,610 = 54.2% (2024). H1 2026 capital expenditure = operating cash flow 6,117 - free cash flow 5,859 = 258. Three wholesalers 29% + 24% + 21% = 74% of gross product sales (2025); 29% + 23% + 21% = 73% (2024). Hepatitis C share of revenue 1,272 / 29,443 = 4.3%, about 4%; sofosbuvir/velpatasvir 2025 1,272 / 1,596 - 1 = -20.3%, a fifth; Mavyret 1,317 / 1,311 - 1 = +0.5%. Cash and capital: free cash flow over revenue 9,456 / 29,443 = 32.1%, about 32%; dividends paid over free cash flow 4,003 / 9,456 = 42.3%, about 42%; free cash flow left after dividends and buybacks 9,456 - 4,003 - 1,922 = 3,531. Dividend per share (3.16 / 1.29)^(1/10) - 1 = 9.4% a year; increases 1.84 / 1.29 - 1 = +42.6% (2016); 2.72 / 2.52 - 1 = +7.9% (2020); 3.00 / 2.92 - 1 = +2.7% (2023); 3.08 / 3.00 - 1 = +2.7% (2024); 3.16 / 3.08 - 1 = +2.6% (2025); quarterly 0.82 / 0.79 - 1 = +3.8% (2026). Buybacks 2015-2016 10,002 + 11,001 = 21,003, about $21bn; year-end market value 2016 over 2015 94.34 / 145.83 - 1 = -35.3%, about a third. Net debt 31 December 2025 = total debt 24,937 - cash and marketable debt securities 10,605 = 14,332; 30 June 2026 = 26,246 - 3,179 = 23,067; net debt over 2025 free cash flow 23,067 / 9,456 = 2.4 years. Interest over operating income 1,024 / 10,022 = 10.2%, about a tenth (2025); 977 / 1,662 = 58.8%, more than half (2024). Gilead stockholders equity 11,829 / 22,703 - 1 = -47.9%, about 48%; return on equity 2025 8,510 / ((19,330 + 22,703) / 2 = 21,017) = 40.5%. Acquisitions: Trodelvy IPR&D impairments 2.7bn (2022) + 2.4bn + 1.8bn (2024) + 1.75bn (2026) = 8.65bn of 15.8bn recorded = 54.7%; Trodelvy Q1 2026 = H1 859 - Q2 457 = 402; Kite plus Immunomedics 11,155 + 20,600 = 31,755, over $31bn; cell therapy 2025 1,839 / 1,973 - 1 = -6.8%; Arcellx IPR&D 7.0bn / cell therapy 2025 1.839bn = 3.8 years. Acquired IPR&D 2019 5,051 + 2020 5,856 + 2021 939 + 2022 944 + 2023 1,155 + 2024 4,663 + 2025 1,024 + H1 2026 11,290 = 30,922, about $30.9bn; acquired IPR&D 2019-2025 alone = 30,922 - 11,290 = 19,632; Biktarvy 2025 US 11,467 + outside US 1,676 + 1,190 = 14,334, all other revenues 29,443 - 14,334 = 15,109 (shown 15.1); net income 2019-2025 5,386 + 123 + 6,225 + 4,592 + 5,665 + 480 + 8,510 = 30,981, about $31.0bn. Revenue lines: Liver Disease share 3,217 / 29,443 = 10.9%, about 11%; Oncology share 3,236 / 29,443 = 11.0%; Oncology 2020 cell therapy 607 + Trodelvy 49 = 656; Oncology 2025 3,236 / 3,289 - 1 = -1.6%, about 2%; 2019-2025 3,236 / 456 = 7.1 times, about sevenfold. Veklury 2021 5,565 / 27,305 = 20.4%, about a fifth; 2025 911 / 29,443 = 3.1%; product sales 2021-2025 28,915 / 27,008 - 1 = +7.1%; excluding Veklury (28,915 - 911 = 28,004) / (27,008 - 5,565 = 21,443) - 1 = +30.6%, about 31%. Other product sales plus royalty, contract and other revenues: 1,547 + 330 = 1,877 (2019); 1,026 + 334 = 1,360; 1,027 + 297 = 1,324; 946 + 299 = 1,245; 859 + 182 = 1,041; 889 + 144 = 1,033; 799 + 527 = 1,326 (2025). Bands sum to total revenues: 2025 20,752 + 3,217 + 3,236 + 911 + 1,326 = 29,442 against reported 29,443 (rounding); 2019 16,438 + 3,678 + 456 + 0 + 1,877 = 22,449. Non-HIV revenue 29,443 - 20,752 = 8,691, / 29,443 = 29.5%. Valuation and earnings: trailing twelve months to June 2026 revenue 29,443 - H1 2025 13,749 + H1 2026 14,763 = 30,457; net income 8,510 - 3,275 + (-8,475) = -3,240; diluted EPS 6.78 - 2.61 + (-6.82) = -2.65. Year-end market value over net income and revenue: 2015 145.83bn / 18,108 = 8.05, / 32,639 = 4.47; 2016 94.34 / 13,501 = 6.99, / 30,390 = 3.10; 2017 93.58 / 4,628 = 20.2, / 26,107 = 3.58; 2018 80.92 / 5,455 = 14.8, / 22,127 = 3.66; 2019 82.21 / 5,386 = 15.3, / 22,449 = 3.66; 2020 73.03 / 123 = 594, / 24,689 = 2.96; 2021 91.08 / 6,225 = 14.6, / 27,305 = 3.34; 2022 107.68 / 4,592 = 23.4, / 27,281 = 3.95; 2023 100.94 / 5,665 = 17.8, / 27,116 = 3.72; 2024 115.12 / 480 = 240, / 28,754 = 4.00; 2025 152.28 / 8,510 = 17.9, / 29,443 = 5.17; October 2026 179.47bn / 30,457 = 5.89. 2026 product sales guidance midpoints (29,600 + 30,000) / 2 = 29,800 (February); (30,000 + 30,400) / 2 = 30,200 (May); (30,100 + 30,400) / 2 = 30,250 (August). Non-GAAP EPS guidance midpoint (-0.65 + -0.30) / 2 = -0.475, plus 9.08 of acquired IPR&D and tax per share = 8.61. Additional: dividends paid 3,918 / 3,809 - 1 = +2.9% (2024), 4,003 / 3,918 - 1 = +2.2% (2025); gross product sales 48,868 / 46,386 - 1 = +5.4%, about 5%; Epclusa 1,966 / 3,510 - 1 = -44.0%; US HIV over US product sales 16,904 / 20,816 = 81.2%; European HIV over European product sales 2,392 / 4,617 = 51.8%; analyst target 158.65 / 144.74 - 1 = +9.6%, about 10%; market value 2025 over 2024 152.28 / 115.12 - 1 = +32.3%, a third. AmBisome 509 / 533 - 1 = -4.5%. Biktarvy over HIV: 4,738 / 16,438 = 28.8% (2019); 8,624 / 16,315 = 52.9% (2021); 11,850 / 18,175 = 65.2% (2023). Descovy + Vemlidy + Odefsey: 1,500 + 488 + 1,655 = 3,643 (2019); 1,700 + 814 + 1,568 = 4,082 (2021); 1,985 + 862 + 1,350 = 4,197 (2023); 2,113 + 959 + 1,288 = 4,360 (2024). Apretude Q1 2026 = H1 260 - Q2 140 = 120 (GBP M). Livdelzi Q1 2026 = H1 300 - Q2 167 = 133 - cash, capital returns, debt, acquisitions and valuation. — FY2015-Q2 2026 · publ. October 2026 · source ↗
    Method: Arithmetic on figures reported in Gilead Sciences Forms 10-K, 10-Q and results releases, SEC XBRL, stockanalysis.com market values, and the GSK and AbbVie filings cited; each operand is stated in the source line.
  7. ReportedIn the first half of 2026 it spent $11.3 billion on Arcellx, Tubulis and Ouro.
    Gilead Sciences second-quarter 2026 results release, Form 8-K exhibit 99.1 - revenue by product, income statement, cash flow, balance sheet, pipeline updates and 2026 guidance - pipeline, regulatory and business development updates. — Q2 2026 · publ. 4 August 2026 · source ↗
  8. Moat Explorer calcReturn on invested capital was 77.5% in 2015 and has been between 2.8% and 22.7% since 2018.
    Moat Explorer calculation, repo method (tools_roic_edgar.py logic) on Gilead Sciences filings: return on invested capital 77.5% (2015), 40.6%, 20.3%, 13.3%, 11.4%, 5.8%, 14.6%, 11.8%, 13.6%, 2.8%, 22.7% (2025). 2023-2025 computed by hand because Gilead stopped tagging CashAndCashEquivalentsAtCarryingValue after 2022, using CashCashEquivalentsRestrictedCashAndRestrictedCashEquivalents: invested capital = total assets - current liabilities - cash: 2022 46,522; 2023 62,125 - 11,280 - 6,085 = 44,760; 2024 58,995 - 12,004 - 9,991 = 37,000; 2025 59,023 - 11,813 - 7,564 = 39,646 ($ millions). 2025 NOPAT = operating income 10,022 x (1 - 1,286 / 9,796 = 13.1% tax) = 8,706; average invested capital (37,000 + 39,646) / 2 = 38,323; 8,706 / 38,323 = 22.7%. 2024: 1,662 x (1 - 30.6%) = 1,154 over (44,760 + 37,000) / 2 = 40,880 = 2.8%. 2023: 7,605 x (1 - 18.2%) = 6,221 over (46,522 + 44,760) / 2 = 45,641 = 13.6%. — FY2015-FY2025 · publ. October 2026 · source ↗
    Method: NOPAT (operating income times one minus the effective tax rate, capped at 35%) divided by average operating invested capital (total assets less current liabilities less cash and equivalents); SEC EDGAR XBRL for 2015-2022 and the 10-K balance sheets for 2023-2025. Marketable securities are not deducted.
  9. Third-party estimateGilead's year-end market value was $145.83 billion in 2015 and was not exceeded at a year end until 2025, when it reached $152.28 billion.
    stockanalysis.com, Gilead Sciences market-cap history: year-end values 145.83 (2015), 94.34, 93.58, 80.92, 82.21, 73.03, 91.08, 107.68, 100.94, 115.12, 152.28 (2025), $ billions; up 30.13% in one year. — 2015-2026 · publ. 2 October 2026 · source ↗
Sources
Generated October 4, 2026