TEVJF · Teva Pharmaceutical Industries Limited

Teva's Q1 2026 results reflect execution of its Pivot to Growth strategy, with innovative brands AUSTEDO ($578M, +41% YoY LC), AJOVY ($196M, +35% YoY LC), and UZEDY ($63M, +62% YoY LC) driving collective 41% growth to $838M, comprising a growing share of revenues and improving margins despite generics headwinds from lenalidomide competition and Japan divestment. GAAP gross margin expanded to 49.5% from 48.2%, and non-GAAP to 52.9% from 52.8%, fueled by higher AUSTEDO mix, though offset by increased S&M spend (up 12% to $696M) on promotional activities. Operating income rose to $652M (16.4% margin) from $519M (13.3%), with non-GAAP at $956M (24.0%). CEO Richard Francis highlighted portfolio transformation and biosimilars momentum, including FDA approval of PONLIMSI (Prolia biosimilar) and Xolair biosimilar filings. The Emalex acquisition adds NDA-ready ecopipam, a first-in-class D1 antagonist for pediatric Tourette syndrome with positive Phase 3 data, aligning with neuroscience strengths for $700M cash + $200M milestones + royalties, closing targeted Q3 2026. 2026 outlook incorporates $700M IPR&D charge and $75M Emalex expenses, maintaining revenue $16.4-16.8B and non-GAAP EPS $1.91-2.11, with ambitions for 30% non-GAAP operating margin and $700M savings by 2027. Share repurchase planning signals capital return potential amid improving profile.