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Even after a strong year for the stock, Gilead Sciences (GILD) produces free cash flow equal to 6.6% of its market value. The median S&P 500 company yields 4.2% by comparison. A cash yield that far above the norm tends to mark either a bargain or a company that investors expect to get smaller. So is the cash behind Gilead’s yield growing, or about to slip?
Gilead’s Cash Has Grown Much Faster Than Revenue
Gilead produced $13.8 billion of free cash flow in the twelve months to September 2026, up from $9.16 billion a year earlier. Revenue rose 6.5% over the same twelve months. Meanwhile, the twelve-month cash total has climbed at every quarter end since September 2025.
That matters to a shareholder, who owns a share of the free cash a business produces whether or not it is paid out. When the market recognizes that cash, the price tends to follow, more so when the cash is growing.
Most of Gilead’s sales come from its HIV drugs. Biktarvy alone sold $14.3 billion in 2025, out of $29.4 billion in total company revenue. Gilead also spends little to keep the business running. Over the past twelve months, capital spending took just 4.8% of its cash from operations. Free cash flow came to 44.5% of revenue, against 28.6% at AbbVie.
Gilead carries debt and booked a $3.86 billion net loss in the year to September. Net debt, what it owes minus its cash, was $19.8 billion in September, 9.4% of its market value. Before deal charges, twelve-month operating income was $11.7 billion against $1.01 billion of interest; management expects a 2026 operating loss of about $2.95 billion.
Biktarvy Faces A Lower Medicare Price In 2028
The clearest reason to doubt how long Gilead’s cash keeps growing is a price cut on Biktarvy. On the October 29 call, management said Medicare has set the drug’s price at $2,600 for a 30-day supply, about 38% below list. Management expects that price, along with its knock-on effects in other U.S. channels, to cut Biktarvy revenue by about $1.5 billion in 2028.
Management says Gilead can grow through the reduction. It expects total HIV revenue, total product sales and earnings per share all to rise in 2028 from 2027. Newer HIV, cancer and inflammation drugs are expected to help, and the company says it will work to soften the cut. Those are forecasts, not results.
So far in 2026, sales have run ahead of management’s forecasts. In October, management raised its 2026 product sales forecast to $31.2 billion at the midpoint, from $30.3 billion in August. Gilead’s 2026 deals are costly, though: management now expects about $12.9 billion of acquired research costs for the year, and its forecast for a 2026 loss per share deepened to $4.22 at the midpoint, from $3.57.