Core Viewpoint - Teva Pharmaceutical Industries Ltd reported its Q1 2025 financial results, showing a revenue increase but missing analyst expectations, while also providing an optimistic outlook for future earnings and operational efficiency [1][3][4]. Financial Performance - Teva's revenue for Q1 2025 was $3.89 billion, a 5% increase year-over-year, but below the analyst estimate of $4.00 billion [1]. - Adjusted earnings per share were 52 cents, surpassing estimates of 48 cents [3]. - Gross profit margin improved to 48.2% from 46.4% year-over-year, with adjusted gross profit margin rising to 52.8% from 51.4% [3]. Product Performance - Austedo's worldwide revenues reached $411 million in Q1 2025, marking a 39% increase in local currency compared to Q1 2024, with U.S. revenues growing by 40% to $396 million [1]. - Ajovy's global revenues were $139 million, a 26% increase in local currency terms compared to Q1 2024 [2]. - Uzedy's global revenues were $39 million in Q1 2025 [6]. Guidance and Outlook - Teva raised its fiscal 2025 adjusted earnings per share guidance from $2.35-$2.65 to $2.45-$2.65, aligning closely with the consensus of $2.55 [3][4]. - The company narrowed its 2025 sales guidance from $16.8 billion-$17.4 billion to $16.8 billion-$17.2 billion, compared to the consensus of $17.24 billion [4]. - Teva increased its Austedo 2025 sales outlook from approximately $1.9-2.05 billion to $1.95-2.05 billion [4]. Operational Strategy - Teva's CEO highlighted the company's transition into the "Acceleration Phase" of its Pivot to Growth Strategy, aiming for a 30% operating margin and $700 million in net savings by 2027 [3]. - The generics business showed growth across all regions, with a 5% increase in the U.S., 1% in Europe, and 2% in International Markets, all in local currency terms compared to Q1 2024 [6].

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Core Insights - Teva Pharmaceutical Industries Ltd. reported $3.89 billion in revenue for Q1 2025, a year-over-year increase of 1.9% and an EPS of $0.52, up from $0.48 a year ago [1] - The revenue fell short of the Zacks Consensus Estimate of $3.97 billion by 1.92%, while the EPS exceeded the consensus estimate of $0.47 by 10.64% [1] Financial Performance - Teva's shares have returned +18.6% over the past month, outperforming the Zacks S&P 500 composite's +10.6% change [3] - The company currently holds a Zacks Rank 3 (Hold), suggesting it may perform in line with the broader market in the near term [3] Geographic Revenue Breakdown - United States: Revenue of $1.91 billion, exceeding the average estimate of $1.87 billion, with a year-over-year change of +10.7% [4] - Europe: AJOVY generated $58 million, slightly above the average estimate of $56.74 million, reflecting a +13.7% year-over-year change [4] - International Markets: COPAXONE revenue was $10 million, below the estimate of $10.67 million, representing a -16.7% change year-over-year [4] - Generic products in International Markets generated $468 million, slightly below the estimate of $487.47 million, with a -1.9% year-over-year change [4] - Europe: COPAXONE revenue was $42 million, below the estimate of $43.68 million, indicating a -26.3% year-over-year change [4] - Europe: Generic products revenue was $989 million, slightly below the estimate of $991.61 million, with a -1.5% year-over-year change [4] - Europe: Other products generated $50 million, significantly below the estimate of $95.70 million, reflecting a -46.8% year-over-year change [4] - Europe: Respiratory products revenue was $55 million, below the estimate of $60.84 million, indicating a -16.7% year-over-year change [4] - International Markets: Other products generated $61 million, below the estimate of $94.61 million, representing a -33% year-over-year change [4] - Total revenue from COPAXONE was $106 million, exceeding the estimate of $84.97 million, with a +7.1% year-over-year change [4] - API sales to third parties amounted to $130 million, surpassing the estimate of $115.17 million, reflecting a +1.6% year-over-year change [4]

Financial Data and Key Metrics Changes - Revenue increased by 5% to GBP 3.9 billion, adjusted EBITDA rose by 3%, and non-GAAP EPS increased by 8% to $0.52 [6][26][30] - Non-GAAP gross margin improved by 140 basis points year over year to 52.8% [27] - Net debt to EBITDA ratio remained just above 3 times [30] Business Line Data and Key Metrics Changes - Innovative brands generated $589 million in sales, a 45% increase year over year, driven by AUSTEDO (up 39%), AJOVY (up 26%), and UZEDI (doubled to $39 million) [8][12][13] - Generics business grew by 3% year on year, with 5% growth in the U.S. [15][16] - Biosimilars launched two products in the U.S. and have five more planned for 2025 to 2027 [17][18] Market Data and Key Metrics Changes - U.S. business for AUSTEDO increased by 40%, with over 60% of new patients on AUSTEDO XR [9][10] - UZEDI gained over 60% market share in the long-acting risperidone market [12] - AJOVY confirmed guidance for $600 million in sales, with strong growth in Europe and international markets [14] Company Strategy and Development Direction - The company is focused on transforming from a generics powerhouse to a leading biopharmaceutical company, emphasizing innovative products and capital allocation [21][34] - The goal is to achieve a 30% operating margin by 2027, supported by a shift towards high-margin innovative products [23][34] - The company plans to modernize operations, reduce costs, and optimize procurement to drive growth [21][34] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving 2027 targets, driven by innovative product growth and effective cost management [19][20] - The company is navigating macroeconomic challenges, including tariffs, without significant impact on business [32][33] - Management highlighted the importance of maintaining a strong U.S. manufacturing footprint to mitigate risks [32][33] Other Important Information - The company has absorbed the impact of new U.S. tariffs in its updated guidance for 2025 [25][32] - The divestiture of the Japanese generics business has been completed, affecting revenue guidance for 2025 [37][38] Q&A Session Summary Question: Transition from generics to biopharma - Management clarified that the generics business remains a crucial part of the strategy, supporting innovation and cost discipline [60][61] Question: Future savings potential - Management indicated that the $700 million in savings is part of an ongoing journey, with continuous efforts to drive efficiencies [61] Question: Impact of Revlimid on EBITDA - Management confirmed that EBITDA will increase in absolute dollars in 2026, despite headwinds from generic Revlimid [76][78] Question: Tariff impact on pricing - Management stated that they have mitigated tariff impacts and have a strong U.S. manufacturing presence to support pricing strategies [70][72] Question: Resource allocation for investments - Management assured that cost reductions will not hinder investments in the innovative portfolio, emphasizing capital allocation efficiency [87][88]

Financial Performance & Outlook - Teva reported a 5% revenue increase in Q1 2025 compared to Q1 2024 [18] - Non-GAAP EPS increased by 8% in Q1 2025 compared to Q1 2024 [18] - Free cash flow saw a significant increase of 238% in Q1 2025 compared to Q1 2024 [18] - The company is on track to achieve a 30% operating profit margin (OPM) by 2027 [44, 93] - Teva is targeting ~$700 million in net savings by 2027 through modernization efforts [39, 95] Key Products & Growth Drivers - AUSTEDO U S revenue grew by 40% year-over-year in Q1 2025, reaching $396 million [24] - Global AUSTEDO revenue reached $411 million in Q1 2025, a 39% year-over-year increase [21, 24] - UZEDY revenues increased by 156% year-over-year in Q1 2025, reaching $39 million [21, 30] - AJOVY global revenues grew by 26% year-over-year in Q1 2025, reaching $139 million [21, 32, 33] Generics & Biosimilars - Global generics experienced a 3% growth in Q1 2025 [21, 34]

Revenue Performance - Q1 2025 revenues reached $3.9 billion, a 5% increase in local currency terms compared to Q1 2024, with a net foreign exchange impact of $100 million resulting in a 2% growth in reported revenues [3]. - AUSTEDO generated worldwide revenues of $411 million in Q1 2025, reflecting a 39% increase in local currency terms year-over-year, with the full-year revenue outlook raised to $1.95-2.05 billion [3]. - AJOVY's global revenues were $139 million in Q1 2025, a 26% increase in local currency terms compared to Q1 2024, reaffirming a $600 million revenue outlook for 2025 [3]. - Revenues from the United States segment in Q1 2025 were $1,910 million, an increase of $184 million, or 11%, compared to Q1 2024 [28]. - Revenues from the Europe segment in Q1 2025 were $1,194 million, a decrease of 6% compared to Q1 2024 [44]. - Revenues from the International Markets segment in Q1 2025 were $582 million, a decrease of 2% compared to Q1 2024, but increased by 5% in local currency terms [57]. - Revenues from other activities in Q1 2025 were $206 million, a decrease of 9% in U.S. dollars compared to Q1 2024 [70]. - The outlook for total revenues in 2025 is projected to be between $16.8 billion and $17.2 billion [72]. - AUSTEDO revenues are expected to be between $1.950 billion and $2.050 billion in 2025 [72]. - Net revenues for Q1 2025 were $3,891 million, a 1.9% increase from $3,819 million in Q1 2024 [81]. Profitability Metrics - Non-GAAP diluted EPS for Q1 2025 was $0.52, an 8% increase year-over-year, while GAAP diluted EPS was $0.18 [3]. - Operating income for Q1 2025 was $519 million, representing a 13.3% margin, compared to an operating loss of $218 million in Q1 2024 [14]. - Gross profit for Q1 2025 was $1,877 million, up from $1,771 million in Q1 2024, reflecting a gross margin improvement [83]. - Net income attributable to Teva for Q1 2025 was $214 million, compared to a net loss of $139 million in Q1 2024 [83]. - Non-GAAP net income attributable to Teva for diluted earnings per share was $602 million in Q1 2025, compared to $548 million in Q1 2024 [83]. - The company reported a total reportable segment profit of $958 million for Q1 2025, up from $890 million in Q1 2024 [103]. Cash Flow and Financial Position - Free cash flow generated in Q1 2025 was $107 million, compared to $32 million in Q1 2024, indicating improved cash generation capabilities [23]. - Cash and cash equivalents decreased to $1,697 million as of March 31, 2025, down from $3,300 million at the end of 2024 [87]. - Total assets decreased to $38,415 million as of March 31, 2025, from $39,326 million at the end of 2024 [88]. - Total current liabilities decreased to $11,157 million as of March 31, 2025, compared to $12,796 million at the end of 2024 [88]. - The company reported a net cash used in operating activities of $105 million for Q1 2025, compared to $124 million for Q1 2024 [90]. Research and Development - Research and Development expenses in Q1 2025 were $247 million, a 2% increase compared to Q1 2024, driven by immunology and oncology projects [12]. - The company is preparing for the Phase 3 program initiation for duvakitug in H2 2025, with an NDA submission for olanzapine LAI also expected in H2 2025 [3]. - Research and development expenses remained stable at $154 million for both Q1 2025 and Q1 2024, indicating consistent investment in innovation [101]. Segment Performance - Gross profit from the United States segment increased by 23% to $1,058 million in Q1 2025, with a gross profit margin of 55.4% [41]. - Segment profit from the United States segment was $532 million in Q1 2025, a 52% increase compared to $350 million in Q1 2024 [42]. - Gross profit from the Europe segment in Q1 2025 was $658 million, down 11% from $738 million in Q1 2024, with a gross profit margin of 55.1% [50]. - Profit from the Europe segment in Q1 2025 was $329 million, a decrease of 22% compared to $423 million in Q1 2024 [52]. - Gross profit from the International Markets segment in Q1 2025 was $278 million, a decrease of 6% compared to $297 million in Q1 2024 [65]. - Profit from the International Markets segment in Q1 2025 was $97 million, a decrease of 17% compared to $117 million in Q1 2024 [67]. Strategic Initiatives - The company expects to achieve a 30% operating profit margin by 2027 as part of its Pivot to Growth Strategy, with targeted net savings of approximately $700 million by that year [3]. - The company plans to divest its API business as part of its strategy to streamline operations and focus on core areas [82].

Core Insights - Teva Pharmaceutical Industries Ltd. reported Q1 2025 revenues of $3.9 billion, marking a 5% increase in local currency terms compared to Q1 2024, driven by strong performance in innovative products and generics [4][5][7] - The company is on track to achieve a 30% operating profit margin by 2027 as part of its Pivot to Growth Strategy, with a revised full-year 2025 revenue outlook of $16.8 to $17.2 billion [4][5][71] - Teva's innovative products, including AUSTEDO, AJOVY, and UZEDY, collectively generated revenues of $589 million, each growing over 25% year-over-year [5][8] Financial Performance - Q1 2025 net income attributable to Teva was $214 million, with diluted earnings per share of $0.18, compared to a net loss of $139 million and a loss per share of $0.12 in Q1 2024 [17] - Non-GAAP diluted EPS for Q1 2025 was $0.52, an increase of 8% year-over-year [4][17] - Adjusted EBITDA for Q1 2025 was $1.041 billion, a 4% increase from $1.005 billion in Q1 2024 [18] Segment Performance - In the United States segment, revenues increased by 11% to $1.91 billion, driven by higher sales of innovative products and generics [25][26] - The Europe segment saw a 6% decrease in revenues to $1.194 billion, primarily due to lower revenues from COPAXONE and mature innovative product rights [42][43] - The International Markets segment reported revenues of $582 million, a 2% decrease, impacted by regulatory price reductions and competition in Japan [54][56] Product Highlights - AUSTEDO revenues in Q1 2025 were $396 million, a 40% increase year-over-year, attributed to volume growth and the launch of AUSTEDO XR [32][33] - AJOVY revenues increased by 18% to $53 million, driven by volume growth and an increase in market share [31][47] - UZEDY revenues surged by 156% to $39 million, reflecting strong demand following its launch [35] Strategic Initiatives - Teva is focused on transforming into a modern biopharmaceutical company, targeting approximately $700 million in net savings by 2027 [4][5][8] - The company is actively pursuing the divestiture of its API business to streamline operations and enhance capital allocation [68][69] - Teva plans to host an Innovation & Strategy Day on May 29, 2025, to discuss its growth strategy and future initiatives [4][73]

For questions regarding the event, please contact Teva's Investor Relations team at TevaIR@Tevapharm.com. A live webcast of the event and presentation materials will be available on Teva's Investor Relations website at: https://ir.tevapharm.com/Events-and-Presentations. An archived version of the webcast will be available within 24 hours after the end of the live discussion. Cautionary Note Regarding Forward-Looking Statements Due to limited capacity, in-person attendance is by invitation only. Analysts and ...

The U.S. Food and Drug Administration (FDA) has approved Teva Pharmaceutical Industries Ltd. TEVA and Alvotech’s ALVO Selarsdi (ustekinumab-aekn) injection as interchangeable with the reference biologic Johnson & Johnson’s JNJ Stelara (ustekinumab).As of April 30, 2025, Selarsdi is available and interchangeable in all presentations matching the reference product, including the treatment of adults and pediatric psoriatic arthritis and plaque psoriasis, as well as Crohn’s disease, and ulcerative colitis.Also ...

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