Merck & Co. MRK reported first quarter 2016 earnings of 89 cents per share, surpassing the Zacks Consensus Estimate of 85 cents and increasing 4.7% from the year-ago period.Merck & Company Inc. (MRK) Street Actual & Estimate EPS - Last 5 Quarters | FindTheCompany Revenues for the quarter declined 1.2% to $9.3 billion, missing the Zacks Consensus Estimate of $9.5 billion. Currency movement negatively impacted revenues by 4%.The Quarter in DetailMerck’s Pharmaceutical segment posted revenues of $8.1 billion, down 2%. Currency movement negatively impacted revenues by 4%. Reduced operations in Venezuela also impacted sales.Products like Remicade (loss of exclusivity in Europe and increasing biosimilar competition in this region), Nasonex (generic version launched in the U.S. in Mar 2016), Zostavax, Isentress and Vytorin all recorded a decline in sales.Meanwhile, Gardasil 9, Keytruda, Cubicin and ProQuad performed well. New product, Keytruda, brought in sales of $249 million in the first quarter of 2016, up from $214 million in the fourth quarter of 2015. Sales continue to be driven by new indications and geographical expansion.Recently launched HCV product Zepatier brought in sales of $50 million.Januvia/Janumet sales grew 1% reflecting strong growth in the U.S. and Europe, partially offset by lower sales in emerging markets.Cubicin sales came in at $292 million. Cubicin will be losing patent protection in Jun 2016 following which sales are expected to fall significantly.Merck’s animal health segment posted revenues of $829 million, unchanged from the year-ago quarter.Marketing and administrative expenses declined 1.1% to $2.3 billion in the first quarter of 2016. R&D spend declined 6% to $1.6 billion in the first quarter of 2016 reflecting lower licensing expenses.Updates GuidanceMerck narrowed and raised its 2016 earnings guidance to $3.65 - $3.77 per share, including an approximately 2% negative impact from foreign exchange at mid-April exchange rates. The company had previously guided towards 2016 earnings of $3.60 - $3.75 per share, including negative currency impact of approximately 4%.The revised outlook reflects recent favorability in foreign exchange rates, partially offset by the earlier than expected entry of a generic version of Nasonex in the U.S.Revenues are now expected in the range of $39.0 billion - $40.2 billion, including an approximately 2% negative impact from foreign exchange. The company had earlier guided towards revenues of $38.7 billion - $40.2 billion, including a negative currency impact of about 3%. The Zacks Consensus Estimate for earnings and revenues is currently $3.71 per share and $40.1 billion, respectively.Meanwhile, Merck continues to expect marketing and administrative spend to decline from 2015 levels and R&D spend to be slightly above 2015 levels. The company spent $6.6 billion and $9.8 billion on R&D and marketing and administrative matters, respectively, in 2015.Our TakeWhile Merck’s first quarter earnings were better-than-expected, revenues once again fell short of estimates. The top-line will remain under pressure mainly due to increased competition as well as generic competition. Merck will continue to look toward cost-cutting initiatives to drive the bottom-line. We are also positive on Merck’s efforts to expand its pipeline and focus on core areas of expertise. Investor focus will remain on the performance of new products like Keytruda and Zepatier.Merck is a Zacks Rank #3 (Hold) stock. Some better-ranked stocks in the large cap pharma sector include Bristol-Myers Squibb Company BMY, Johnson & Johnson JNJ and Novo Nordisk A/S NVO. While Bristol-Myers is a Zacks Rank #1 (Strong Buy) stock, Johnson & Johnson and Novo Nordisk are Zacks Rank #2 (Buy) stocks.Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report BRISTOL-MYERS (BMY): Free Stock Analysis Report NOVO-NORDISK AS (NVO): Free Stock Analysis Report JOHNSON & JOHNS (JNJ): Free Stock Analysis Report MERCK & CO INC (MRK): Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research