The world's biggest drugmaker, whose shares rose almost 1 percent in premarket trading, said on Tuesday that it had earned $1.44 billion, or 19 cents per share, in the fourth quarter. That compared with $2.89 billion, or 36 cents per share, a year earlier.
Excluding special items, Pfizer earned 50 cents per share. Analysts on average expected 47 cents, according to Thomson Reuters I/B/E/S.
Pfizer said results in the latest quarter appeared so unfavorable largely because of a big tax benefit in the year-earlier period.
Revenue fell 4 percent to $16.75 billion, but was a bit higher than Wall Street expectations of $16.61 billion.
Last year, Pfizer vowed to slash billions of dollars in costs, largely through layoffs of thousands of researchers, to weather plunging sales of Lipitor. The pill had been the world's top-selling drug for years, capturing annual sales of more than $13 billion at its peak, but it lost U.S. patent protection in late November.
Global fourth-quarter sales of Lipitor fell 24 percent to $2 billion, including a 42 percent decline in the United States. But some of Pfizer's other biggest drugs scored moderate sales gains, helped by price increases. Sales of arthritis treatment Enbrel and the Celebrex painkiller each rose 7 percent, to $865 million and $622 million, respectively. Sales of impotence treatment Viagra rose 5 percent to $523 million.
As in the third quarter, Pfizer's strongest gains came from its nutritional products and animal health units -- noncore businesses that it aims to possibly sell or spin off.
Chief Executive Officer Ian Read on Tuesday said that any separation of the two businesses would occur between July 2012 and July 2013.
Sales of animal health brands rose 13 percent in the quarter to $1.1 billion, while sales of nutritional products -- including baby formula and maternity supplements -- jumped 22 percent to $598 million.
Pfizer forecast 2012 earnings of $2.20 to $2.30 per share, excluding items. That range was down from its prior outlook of $2.25 to $2.35.
The company lowered its 2012 revenue forecast to a range of $60.5 billion to $62.5 billion, from its earlier outlook of $62.2 billion to $64.7 billion.
Shares of Pfizer were up 0.6 percent at $21.70 in trading before the market opened.
(Reporting By Ransdell Pierson; Editing by Derek Caney and Lisa Von Ahn)