Earnings Analysis November 3, 2026

Teva Pharmaceutical Industries Ltd ($TEVA) Q3 2026 Earnings Analysis: Revenue and EPS Both Beat Estimates, Annual Guidance Raised

Earnings Report

Revenue: $4.395 billion (YoY -2%, Expected $4.239 billion) ✅ Beat

EPS (Earnings Per Share): Adjusted $0.86 (YoY +10%, Expected $0.73) ✅ Beat

Guidance: Raised, 2026 revenue $16.7 billion–$17.0 billion · Adjusted EPS $1.92–$2.11 (Adjusted operating income lowered to $3.8 billion–$3.9 billion)

Stock Reaction: After-hours +3.19% ($42, as of 11-03 22:12 KST)

Highlights

33% Growth in Core New Drugs: Combined revenue from AUSTEDO, AJOVY, and UZEDY reached approximately $1.1 billion

Gross Margin 58.7%: Improved by 345bp YoY on an adjusted basis, marking the highest quarterly margin in the last 10 years

Raised Annual Outlook: Raised revenue guidance to $16.7 billion–$17.0 billion and increased targets for all three products

As the product mix shifts toward new drugs, a structure where profits increase even if revenue decreases has become distinct. Additionally, all three major U.S. credit rating agencies upgraded the company to investment grade, and financial burden has been eased following the completion of $4.9 billion in refinancing.

Lowlights

U.S. Generics -39%: U.S. generic revenue fell to $718 million due to competition with lenalidomide

Lowered Operating Income Outlook: Projections for adjusted operating income and adjusted EBITDA were lowered due to the reflection of $100 million in acquisition and development costs

Slowing Operating Cash Flow: Operating cash flow was $241 million, falling short of the $369 million from the previous year

Operating income on a GAAP basis was $714 million, a decrease from the previous year, reflecting $228 million in impairment of tangible assets and $201 million in legal settlement provisions. The Phase 2 trial for emrusolmin, a treatment for multiple atrophy, was discontinued following a futility interim analysis.

What the Company Said

CEO Richard Francis evaluated that the third-quarter performance shows the pivot-to-growth strategy is indeed working. The company expressed confidence in margin expansion and cash generation, enough to raise the revenue outlook for all three core products simultaneously, and the market accepted this through the upward guidance revision.

Market Reaction and Future Key Points

After both revenue and adjusted earnings per share (EPS) exceeded expectations and the annual revenue guidance was raised, after-hours buying pressure emerged.

It is necessary to confirm how quickly Weltruza sales in the U.S. actually translate into revenue in the fourth quarter.

It is necessary to gauge when the decline in lenalidomide prices will stop and determine the bottom for U.S. generic sales.

We need to examine the 2027 margin trajectory after the $100 million in acquisition development costs is excluded from adjusted earnings.

Earnings Call Summary

Once the company script is released following the earnings call, the key takeaways from the call will be added here. We will select and summarize only the most important points, such as how management explained the results and outlook and what questions analysts asked.