What Alvotech (ALVO) Said on Its Q3 Earnings Call

Key Points

• Alvotech maintained its full-year targets of $650 million–$700 million in revenue and $180 million–$220 million in adjusted EBITDA, but expects results near the low end. Reaching even that end requires a much stronger fourth quarter, which executives expect to be the company’s strongest of 2026.
• Production is recovering after facility upgrades constrained supply; new FDA-approved manufacturing changes for Simlandi more than double output per batch and expand capacity. Cash fell to $61 million amid a large working-capital outflow, though the company expects to be cash-flow positive in Q4.
• Three biosimilar applications have FDA decisions expected in December, including AVT05, which is also subject to a patent injunction challenge that could affect its U.S. launch. Alvotech is preparing for launches while advancing additional pipeline products, with executives anticipating substantial adjusted EBITDA improvement in 2027.

Alvotech NASDAQ: ALVO expects its full-year revenue and adjusted earnings to land near the lower end of its guidance range, as the biosimilar maker works to increase deliveries following a manufacturing slowdown.

Executives said on the company’s third-quarter earnings call that they expect the final quarter of 2026 to be its strongest of the year. Alvotech is also awaiting U.S. regulatory decisions on three products in December and preparing for potential launches, including a biosimilar to Simponi that faces a patent challenge.

For the third quarter, revenue rose 5% from the preceding quarter to $112 million, but fell 2% from a year earlier. Adjusted EBITDA was $31 million, up 40% sequentially and double the year-earlier figure, Chief Financial Officer Linda Jónsdóttir said.

Guidance Depends on a Strong Fourth Quarter

Alvotech maintained its full-year targets of $650 million to $700 million in revenue and $180 million to $220 million in adjusted EBITDA. With nine-month revenue at $323 million and adjusted EBITDA at $78 million, reaching the low end would require approximately $327 million in revenue and $102 million in adjusted EBITDA in the fourth quarter.

Jónsdóttir said timing factors had pushed the company’s expectations toward the lower end of the ranges. Revenue from both product shipments and licensing milestones can fluctuate between quarters, she said, with partner orders and delivery schedules influencing product revenue.

Asked whether missing the expected December approvals could put guidance at risk, Jónsdóttir said the company would maintain the lower end of the range despite the approvals. She declined to specify how much fourth-quarter revenue would come from product sales versus milestones.

For the first nine months, revenue fell 23% from a year earlier, which Jónsdóttir attributed to slower production, the timing of licensing revenue and the prior-year U.S. launch of a biosimilar to Stelara. Adjusted EBITDA rose 15% to $78 million.

Manufacturing Capacity Expands

Alvotech said facility improvements that began in the second half of 2025 and continued through the first half of 2026 slowed production and temporarily constrained supply. Those activities were completed by the end of the second quarter, but the third quarter still reflected an ongoing ramp-up, Jónsdóttir said.

Chief Operating Officer Joseph McClellan said the U.S. Food and Drug Administration approved two changes in October for manufacturing Simlandi, Alvotech’s adalimumab biosimilar, at its Iceland facility. One permits production of the drug substance for the U.S. market in two manufacturing suites, effectively doubling available capacity, he said.

The second approval covers an enhanced process that more than doubles drug substance output per batch compared with the previously approved process. McClellan said Alvotech has implemented the process and is supplying product made with it to the U.S. and Europe for the fourth quarter.

Alvotech is also expanding its supply network. Lotte Biologics will manufacture drug substance for multiple products at its Syracuse, New York, facility, while commercial production with Fujifilm is expected to begin in the second half of 2027.

Launches Face Regulatory and Patent Hurdles

McClellan said three applications share a December FDA decision date: AVT05, a proposed biosimilar to Simponi and Simponi Aria; AVT06, a proposed biosimilar to Eylea 2 mg; and AVT03, a proposed biosimilar to Prolia and Xgeva. He noted that the agency reviews each application independently.

Chief Executive Officer Lisa Graver said Alvotech and partner Teva are preparing for a U.S. launch of AVT05, subject to regulatory approval and a favorable outcome on a pending preliminary injunction motion filed by the brand company. Graver said Alvotech was confident in its patent position but could not comment on Teva’s precise launch timing.

In Europe, Alvotech and partner Advanz Pharma have established a presence for AVT05 in 13 markets, including the five largest, Graver said.

Other pipeline programs include proposed Entyvio biosimilars covering intravenous and subcutaneous administration, with applications under review in the U.S. and Europe. Alvotech has also submitted an application in Europe for AVT29, a proposed biosimilar to high-dose Eylea, which executives described as the first known regulatory submission worldwide for such a product.

Graver said Alvotech believes it has strong positions in patent challenges involving both Entyvio and high-dose Eylea. The company is preparing to compete in the first wave of Entyvio biosimilars, she said, though regulatory and patent outcomes remain pending.

Cash and 2027 Outlook

Cash on hand fell to $61 million at the end of the third quarter from $143 million at its start. Jónsdóttir said working capital absorbed approximately $116 million during the quarter as the company ramped up manufacturing. Net interest payments were $37 million.

Jónsdóttir said Alvotech expects to be cash-flow positive in the fourth quarter. Asked whether the company was fully financed until reaching cash-flow positivity, she said that if capital were needed, Alvotech was confident it could secure it.

The company has not issued detailed 2027 guidance, but Jónsdóttir said she expects substantial improvement in adjusted EBITDA next year and a stronger product-margin profile. Alvotech has also projected “healthy deleveraging” in the later part of 2027, she said.

Graver said demand for the company’s established AVT02 and AVT04 franchises remains strong and is expected to continue into 2027, alongside potential contributions from new launches.

About Alvotech (NASDAQ:ALVO)

Alvotech is a biopharmaceutical company based in Reykjavik, Iceland, focused on developing and manufacturing biosimilars—medicines designed to be highly similar to existing biologic drugs. Its work includes biosimilars for conditions in areas such as immunology and oncology. Founded in 2013 by entrepreneur Robert Wessman, the company operates an integrated development and manufacturing platform in Iceland. Alvotech works with commercial partners to seek regulatory approval for and distribute its products in markets including the United States and Europe.

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