Teva Pharmaceutical Industries (TEVA) Q2 2026 earnings summary

Executive summary

• Q2 2026 revenues were $4.14 billion, down 1% year-over-year, mainly due to lower generics, while innovative products AUSTEDO, AJOVY, and UZEDY grew strongly.

• Emalex Biosciences acquisition closed in June, resulting in significant R&D expenses and a net loss, but expected to be accretive to EPS and margins from 2028.

• Raised 2026 outlook for key innovative brands, expecting combined revenue of ~$3.7 billion, reflecting ~17% YoY growth at the midpoint.

• Continued execution of the Pivot to Growth strategy, focusing on innovation, biosimilars, and disciplined capital allocation.

Financial highlights

• Q2 2026 revenues were $4.1–$4.14 billion, down 1% YoY; gross profit margin improved to 52.0% (GAAP), 55.4% (non-GAAP).

• Non-GAAP EPS was $0.02; net loss attributable to shareholders was $576 million, mainly due to Emalex acquisition costs.

• Adjusted EBITDA was $474 million, down 62% YoY; free cash flow rose 31% to $622 million.

• R&D expenses surged to $970 million, mainly due to Emalex.

• Debt stood at $16.6 billion as of June 30, 2026; net debt was $12.9 billion.

Outlook and guidance

• 2026 revenue guidance raised to $16.5–$16.85 billion; innovative brands (AUSTEDO, AJOVY, UZEDY) guidance increased to $3.7 billion.

• Non-GAAP operating income expected at $3.8–$4.0 billion; adjusted EBITDA at $4.23–$4.53 billion.

• Non-GAAP diluted EPS forecasted at $1.91–$2.11; free cash flow at $2.0–$2.4 billion.

• 2027 targets reaffirmed: mid-single digit revenue CAGR, 30% non-GAAP operating margin, net debt/EBITDA at 2.0x.

• Transformation programs to reduce workforce by 8% by end of 2027 and drive cost savings.