Teva Pharmaceutical Industries (TEVA) Q2 2024 earnings summary

Executive summary

• Q2 2024 revenues reached $4.2 billion, up 7% in USD and 11% in local currency year-over-year, driven by strong growth in generics and AUSTEDO, with innovative and biosimilar pipelines advancing.

• Adjusted EBITDA rose 4% to $1.2 billion, and non-GAAP EPS increased 9% to $0.61; net loss narrowed to $846 million from $872 million in Q2 2023.

• Raised 2024 guidance for revenue, adjusted EBITDA, and non-GAAP EPS, reflecting continued momentum in the Pivot to Growth strategy.

• AUSTEDO U.S. revenue grew 32% to $407 million; AJOVY global sales rose 12%; generics grew 14% globally.

• Progress in late-stage pipeline, including duvakitug (Anti-TL1A) and olanzapine LAI, and strong launches for biosimilars like SIMLANDI.

Financial highlights

• Q2 2024 revenue: $4.2 billion, up 7% in USD and 11% in local currency year-over-year; adjusted EBITDA: $1.2 billion, up 4% year-over-year.

• Non-GAAP EPS: $0.61, up 9% year-over-year; GAAP net loss: $846 million, improved from $872 million loss in Q2 2023.

• Free cash flow: $324 million, down from $632 million in Q2 2023 due to working capital and tax payments.

• Net debt reduced to $16.4 billion; net debt/EBITDA improved to 3.3x from 4.14x a year ago.

• Gross margin (non-GAAP): 52.9% (up from 52.2%); operating margin: 25.3% (down from 26.1%).

Outlook and guidance

• 2024 revenue guidance raised to $16.0–$16.4 billion; adjusted EBITDA $4.6–$5.0 billion; non-GAAP EPS $2.30–$2.50.

• Product-specific 2024 outlook: AUSTEDO ~$1.6 billion, AJOVY ~$500 million, UZEDY ~$80 million, COPAXONE ~$450 million.

• Free cash flow expected at $1.7–$2.0 billion; non-GAAP gross margin expected at 53–54% for the full year.

• Non-GAAP tax rate expected at 14–17% for 2024.

• 2027 targets reiterated: mid-single digit revenue growth, 30% operating margin, net debt/EBITDA 2x, and 80% cash flow to earnings.