TEVA(US:TEVA)2024-11-06 21:06Revenue Performance - Revenues in Q3 2024 were $4,332 million, a 13% increase in U.S. dollars and 15% in local currency compared to Q3 2023, driven by higher revenues from generic products across all segments [260]. - The United States segment generated revenues of $2,225 million, a 17% increase, with segment profit rising by 31% to $748 million compared to Q3 2023 [260]. - The Europe segment reported revenues of $1,265 million, a 10% increase in U.S. dollars, with segment profit also increasing by 10% [260]. - The International Markets segment generated revenues of $613 million, a 4% increase in U.S. dollars, but segment profit decreased by 7% [260]. - AUSTEDO revenues in the United States segment increased by 28% to $435 million in Q3 2024, compared to $339 million in Q3 2023, driven by volume growth and expanded patient access [274]. - UZEDY revenues in the United States segment were $35 million in Q3 2024, following its launch in May 2023 for the treatment of schizophrenia [277]. - Combined revenues for BENDEKA and TREANDA in the United States segment decreased by 28% to $40 million in Q3 2024, primarily due to competition from alternative therapies and the entry of generic products [278]. - COPAXONE revenues in the United States segment decreased by 30% to $69 million in Q3 2024, attributed to market share erosion and increased competition [283]. - Europe segment revenues in Q3 2024 were $1,265 million, a 10% increase from $1,146 million in Q3 2023 [298]. - International Markets segment revenues in Q3 2024 were $613 million, a 4% increase from $591 million in Q3 2023 [317]. Profitability and Margins - Gross profit margin improved to 49.6% in Q3 2024, up from 48.1% in Q3 2023 [260]. - Gross profit from the United States segment increased by 19% to $1,265 million in Q3 2024, compared to $1,060 million in Q3 2023 [290]. - Gross profit margin for the United States segment rose to 56.9% in Q3 2024, up from 55.9% in Q3 2023, mainly due to a favorable product mix [291]. - Gross profit from the Europe segment in Q3 2024 was $698 million, an 8% increase from $648 million in Q3 2023, with a gross profit margin of 55.2% [307]. - Gross profit from the International Markets segment in Q3 2024 was $306 million, a 4% increase from $293 million in Q3 2023, with a gross profit margin of 49.9% [323]. - Gross profit in Q3 2024 was $2,148 million, an increase of 16% compared to $1,851 million in Q3 2023 [336]. - Profit from the United States segment in Q3 2024 was $748 million, a 31% increase from $571 million in Q3 2023 [296]. - Profit from the Europe segment in Q3 2024 was $373 million, a 10% increase from $338 million in Q3 2023 [312]. - Profit from International Markets segment in Q3 2024 was $109 million, a decrease of 7% compared to $117 million in Q3 2023 [330]. Expenses and Losses - R&D expenses decreased by 5% to $240 million in Q3 2024 compared to $253 million in Q3 2023 [260]. - Operating loss was $51 million in Q3 2024, a decline from operating income of $344 million in Q3 2023 [260]. - S&M expenses for the United States segment increased by 6% to $259 million in Q3 2024, driven by promotional activities for AUSTEDO [293]. - G&A expenses for the United States segment increased by 16% to $107 million in Q3 2024, compared to $93 million in Q3 2023 [294]. - Net loss in Q3 2024 was $437 million, compared to a net income of $69 million in Q3 2023 [357]. - Diluted loss per share was $0.39 in Q3 2024, compared to diluted earnings per share of $0.06 in Q3 2023 [358]. - The company reported a goodwill impairment of $600 million for the three months ended September 30, 2024 [450]. - Operating loss was $274 million in the first nine months of 2024, an improvement from an operating loss of $323 million in the same period of 2023 [413]. Cash Flow and Debt - Free cash flow increased to $922 million in Q3 2024, up from $229 million in Q3 2023, primarily due to higher cash flow from operating activities [262]. - Cash flow generated from operating activities in Q3 2024 was $693 million, a significant increase from $5 million in Q3 2023 [440]. - Cash and cash equivalents as of September 30, 2024, were $3,319 million, an increase from $3,226 million as of December 31, 2023 [430]. - As of September 30, 2024, the company's total debt decreased to $18,980 million from $19,833 million as of December 31, 2023, primarily due to the repayment of $956 million of senior notes [433]. - The financial leverage ratio increased to 75% as of September 30, 2024, compared to 71% as of December 31, 2023 [435]. Strategic Initiatives - The company intends to divest its API business, with completion expected in the first half of 2025 [332]. - The company is committed to paying royalties to partners and owners of know-how, with royalty periods not exceeding 20 years in some cases [444]. - As of September 30, 2024, the generic products pipeline includes 125 applications awaiting FDA approval, with potential U.S. sales of approximately $119 billion for the underlying branded products [287]. Non-GAAP Financial Metrics - Non-GAAP net income attributable to Teva for the nine months ended September 30, 2024, was $2.043 billion, compared to $1.762 billion for the same period in 2023, reflecting a 15.9% increase [451]. - Non-GAAP diluted EPS for the third quarter of 2024 was $0.69, up from $0.60 in the third quarter of 2023, representing a 15% increase [451]. - The non-GAAP tax rate for the nine months ended September 30, 2024, was 15.5%, compared to 13.0% for the same period in 2023 [451]. - The GAAP diluted earnings per share attributable to Teva for the nine months ended September 30, 2024, was $(1.26), compared to $(0.91) for the same period in 2023 [451].