Teva Pharmaceutical Industries Limited

What they do

Teva operates through three segments — United States, Europe and International Markets — each managing its entire product portfolio in its region, including generics, biosimilars, OTC and innovative medicines. The United States segment markets more than 350 generic prescription products and also includes Anda, a distribution business serving independent pharmacies, chains, hospitals and physician offices. Additional revenue comes from API sales to third parties, contract manufacturing and an out-licensing platform through the affiliate Medis. Teva reports approximately 34,000 employees.

Revenue drivers

• Generic medicines — Generics generated $9,421 million, or 55% of total revenues, in 2025, making them the largest revenue source; the company describes this business as generally less profitable than innovative medicines and subject to price erosion.
• United States segment — Generated $9,186 million in revenues and $3,356 million in profit in 2025, up 14% and 46% respectively versus 2024, driven by generic products plus CNS brands AUSTEDO, AJOVY and UZEDY.
• Europe segment — Generated $5,040 million in revenues and $1,303 million in profit in 2025; revenues decreased 1% in U.S. dollars (5% in local currency) and profit decreased 17% versus 2024.
• International Markets and Other Activities — International Markets generated $2,162 million in revenues and $336 million in profit in 2025, down 12% in dollars; Other Activities, including API sales and Medis out-licensing, generated $870 million.

Recent performance

Q2 2026 revenues were $4,142 million, down 1% in U.S. dollars and 3% in local currency year-over-year, mainly on lower generics revenues; global generics revenues fell 15% in local currency due to reduced U.S. lenalidomide capsules sales from increased generic competition. The three key innovative brands grew 43% year-over-year in local currency to over $1 billion combined: AUSTEDO $696 million (up 40%), AJOVY $244 million (up 56%) and UZEDY $77 million (up 43%). GAAP loss per share was $0.49, reflecting $726 million of Emalex-related expenses, and non-GAAP diluted EPS was $0.02. Operating cash flow was $411 million and free cash flow $622 million in the quarter. Full-year 2025 revenues were $17,258 million, up 4% in dollars and 3% in local currency, with net income of $1,410 million.

Strategy

Teva is executing its 'Pivot to Growth' strategy announced in May 2023, which entered its 'Accelerate Growth' phase in 2025, focused on growing the innovative portfolio, aligning capital allocation and modernizing operations. In June 2026 it completed the Emalex Biosciences acquisition for approximately $700 million in cash, adding ecopipam (EBS-101) for Tourette syndrome, and submitted an NDA to the FDA the same month; up to $200 million and $125 million in additional milestones plus royalties may be payable. The company is advancing late-stage programs including olanzapine LAI, TEV-'408 (anti-IL-15) and duvakitug (anti-TL1A, with Sanofi), and launched AHZANTIVE, an Eylea biosimilar, in Europe. Under Transformation programs announced May 7, 2025, Teva targets a 30% non-GAAP operating income margin by 2027 and approximately $700 million of net savings by 2027.

Risks

• Generics concentration and price erosion — Generics were 55% of 2025 revenues and face price erosion in every segment, with Q2 2026 global generics revenues down 15% in local currency.
• Macroeconomic and tariff exposure — A significant portion of revenues is in non-U.S. dollar currencies and many products are manufactured outside the United States, exposing Teva to foreign exchange swings and to U.S. tariffs or reciprocal actions that could affect costs.
• Geopolitical and supply chain disruption — The ongoing war involving Iran has disrupted maritime shipping routes and air cargo hubs used for pharmaceutical products and key inputs; Teva has personnel and several manufacturing and R&D facilities in Israel.
• Leverage — At June 30, 2026, total liabilities were $32.10 billion against $39.86 billion in total assets and $7.75 billion of shareholder equity.

Outlook

Teva raised its 2026 revenue outlook for all three key innovative brands and now expects combined 2026 revenue of approximately $3.7 billion, reflecting about 17% year-over-year growth at the midpoint. The biosimilars portfolio is targeted to reach $800 million in revenues by 2027, and olanzapine LAI is on track for U.S. launch in Q4 2026 subject to regulatory approval. Management targets a 30% non-GAAP operating income margin by 2027 and approximately $700 million of net savings by 2027 from the Transformation programs.