Teva Pharmaceutical Industries NYSE: TEVA reported third-quarter 2026 revenue of approximately $4.4 billion, down 2% from a year earlier, as growth in its innovative medicines portfolio was offset by lower generic-drug sales, particularly generic REVLIMID.
Chief Executive Officer Richard Francis said the company’s innovative portfolio grew 32% year over year, led by AUSTEDO, AJOVY and UZEDY. Teva raised its full-year revenue outlook and increased guidance for each of the three products.
“The growth engine of our innovative portfolio is accelerating,” Francis said, describing the company’s ongoing shift from a generics-focused business toward a higher-margin biopharma model.
Innovative portfolio drives growth
AUSTEDO generated $751 million in third-quarter revenue, an increase of 21% globally. U.S. revenue rose 21% to $727 million, while U.S. total prescriptions increased 18% and milligrams dispensed rose 23%, according to Teva. The company increased its full-year AUSTEDO revenue outlook to $2.55 billion to $2.65 billion.
UZEDY revenue climbed 96% to $85 million in the quarter. Francis said the treatment, a long-acting injectable for schizophrenia, was the fastest-growing long-acting injectable in the category. Teva raised its full-year UZEDY forecast to $290 million to $310 million.
AJOVY, Teva’s migraine treatment, posted revenue of $269 million, up 61% year over year. U.S. revenue increased 89%, while international growth was supported by volume and market-share gains. Teva raised AJOVY guidance to $930 million to $960 million for the full year and said it sees a path to more than $1 billion in peak sales.
The company also highlighted the recent FDA approval and planned fourth-quarter launch of WELTRUZA, a long-acting olanzapine treatment for schizophrenia. Francis said Teva expects revenue from WELTRUZA to be more meaningful in the latter half of 2027 as payer coverage expands, particularly among Medicaid plans. The company expects little revenue contribution during the fourth quarter because early use will largely involve samples and vouchers.
Margins expand despite revenue decline
Teva reported GAAP net profit of $233 million, or $0.20 per share. Non-GAAP earnings per share rose 10% from the prior-year quarter to $0.86.
Chief Financial Officer Eli Kalif said non-GAAP gross margin reached 58.7%, up 245 basis points from the prior-year period, reflecting a more favorable mix of innovative products. GAAP operating margin was 31.7%, up 282 basis points, though the result included gains from property sales in Europe and was affected by planned commercial investments and preparation for the WELTRUZA launch.
Free cash flow totaled $495 million during the quarter. In October, Teva repaid approximately $1.8 billion of debt maturities, and Kalif said the company had no outstanding borrowings under its revolving credit facility.
Teva said it has achieved investment-grade status from all three major credit rating agencies and refinanced $4.9 billion of senior notes during the quarter. Kalif said the company has repaid approximately $12 billion of debt since 2019 and remains on track to reach a net-debt-to-EBITDA ratio of 2x by the end of 2027.
Full-year outlook raised
Based on year-to-date performance and visibility into the remainder of 2026, Teva raised its full-year revenue guidance to $16.7 billion to $17 billion, representing a $175 million increase at the midpoint.
- Operating income is expected to be $3.8 billion to $3.9 billion.
- Adjusted EBITDA is projected at $4.23 billion to $4.43 billion.
- Diluted EPS guidance was raised to $1.92 to $2.11.
- Free-cash-flow guidance was increased to $2.1 billion to $2.4 billion.
Kalif said Teva expects fourth-quarter AUSTEDO revenue to decline year over year due to anticipated changes in purchasing patterns and pricing ahead of Inflation Reduction Act implementation in January.
Pipeline and biosimilar expansion
Teva said it discontinued its Phase II emrusolmin study following an independent data monitoring committee’s pre-specified interim futility analysis. Francis said there were no safety concerns, though he called the outcome disappointing.
The company expects a potential regulatory approval decision for ecopipam, a treatment candidate for Tourette syndrome, in the first quarter of 2027. Teva also acquired BXCL501 from BioXcel, a dexmedetomidine asset that it believes could address acute agitation in at-home settings. The agreement included a $57.5 million upfront payment and up to $67.5 million in contingent payments tied to approval timing and sales milestones.
In generics, revenue declined 16%, primarily because of a lower contribution from generic REVLIMID. Excluding generic REVLIMID, Francis said the global generics business grew 1%.
Teva expects its generics business to be flat to slightly higher in 2026 in local currency, excluding generic REVLIMID and its divested Japan business. The company said biosimilars are becoming an increasingly important growth contributor, with 15 products currently marketed and 16 additional products in its pipeline. Teva now expects to reach its $800 million biosimilar sales target in 2026, a year earlier than previously anticipated.
About Teva Pharmaceutical Industries (NYSE:TEVA)
Teva Pharmaceutical Industries Ltd. is a global pharmaceutical company headquartered in Tel Aviv, Israel. Founded in 1901, the company is one of the world's largest producers of generic medicines and develops, manufactures and distributes prescription products across a broad range of therapeutic areas.
Teva's portfolio includes generic medicines, specialty pharmaceuticals, biosimilars, active pharmaceutical ingredients and over-the-counter products. Its specialty medicines include treatments for neurological and movement disorders, respiratory conditions, migraine and other chronic diseases.
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