Pfizer Inc posted disappointing revenue for Lipitor and other medicines, exposing the risks the world's biggest drugmaker faces if it sells better-performing units like its nutritional products business.

Pfizer is widely expected to divest one or more of its four non-core units, allowing it to focus on growth from promising new medicines.

But that may take time. New Chief Executive Ian Read said in an interview that Pfizer will provide rough outlines by year's end on what it might sell or spin off, and could take until early 2012 to develop full-fledged plans.

There will be no Big Bang this year, he said, noting that other units that could be gradually divested include Pfizer's consumer health business and animal health unit. He said the best use of proceeds would likely be to buy back company shares.

We need to focus on the fact that we're an innovative pharmaceutical company and that is 85 percent of our revenue base today. And we need to get that right, Read told Reuters. I don't think diversification for diversification's sake gives you a premium in your stock price.

Many investors fear Pfizer will be far too big to deliver strong profit growth once Lipitor and other top drugs lose their exclusive marketing status in the next few years.

Pfizer is most likely to sell its nutritionals business and could get as much as $7 billion for it, which could be used to buy back more company shares, said Morningstar analyst Damien Conover. He said a sale of the consumer products business was somewhat less likely, but could fetch $6 billion.

But it may not be simple to give up the non-core businesses, which have helped offset anemic drug sales, especially since Pfizer laboratories have not produced a new best-seller since introducing Viagra more than a decade ago.

The company is pinning its hopes on new medicines for rheumatoid arthritis, lung cancer and stroke now in advanced clinical trials.

Pfizer shares closed down 2.8 percent at $20.44 after gaining more than 10 percent since early February, when Read announced plans to streamline Pfizer. The company turned over the reins to him in December after the abrupt departure of Jeffrey Kindler.

A GAMBLE ON DRUGS

Cholesterol fighter Lipitor, Pfizer's biggest product, led drug sales lower in the first quarter. Its revenue tumbled 13 percent to $2.39 billion due to generic competition in overseas markets, foreshadowing the drug's even worse plight once it loses U.S. patent protection in November.

In all, the company earned $2.22 billion, or 28 cents per share, in the first quarter. That compared with $2.03 billion, or 25 cents per share, a year earlier, when Pfizer took charges for its late 2009 purchase of U.S. rival Wyeth.

Earnings were 60 cents per share, excluding special items and the Capsugel business that is being sold. Analysts on average expected 59 cents, according to Thomson Reuters I/B/E/S.

Results benefited from a weaker dollar that boosted the value of sales abroad, new products obtained by the purchase of King Pharmaceuticals and a sharply lower tax rate.

Large U.S. rivals also topped first-quarter forecasts, helped by a weaker dollar and cost cuts, with Merck & Co Inc and Bristol-Myers Squibb Co posting the biggest profit beats.

Pfizer revenue of $16.5 billion was a bit lower than a year earlier and trailed Wall Street expectations of $16.63 billion. Prescription drug sales fell 2 percent to $14.2 billion.

Sales of animal-health products -- mainly for livestock and pets -- jumped 16 percent to $982 million. Sales of consumer products, including Centrum vitamins and painkiller Advil, rose 12 percent to $745 million. Nutritional product sales rose 3 percent to $470 million.

Pfizer, which has bought three of the largest U.S. drugmakers over the past decade, has already slimmed down its operations considerably. Three months ago, Read vowed to slash the company's research budget by up to $2 billion, to between $6.5 billion and $7 billion, eliminating thousands of jobs.

The move pleased investors by allowing Pfizer to stick to its 2012 profit forecast, which calls for earnings similar to what it reported for 2010.

In early April, Pfizer announced plans to sell Capsugel, the world's largest maker of hard capsules, to private equity firm KKR & Co for $2.38 billion. The deal will enable Pfizer to make up to $2 billion in share repurchases this year beyond its previous plans for $5 billion.

(Reporting by Ransdell Pierson and Lewis Krauskopf; editing by Lisa Von Ahn, Maureen Bavdek editing by Andre Grenon)

Pfizer Fall