Key Highlights

  • Third quarter 2026 Revenue came to USD 4,395 million, slipping 2% in both U.S. dollar and local currency terms as generic lenalidomide sales declined.
  • Gross profit margin improved to 55.5% from 51.4%, aided by a richer product mix in which AUSTEDO took the lead.
  • U.S. generic product revenue fell 39% to USD 718 million, whereas AUSTEDO grew 21% to USD 727 million and UZEDY climbed 96% to USD 85 million.
  • Operating income landed at USD 714 million against USD 882 million a year earlier, after legal settlement and loss contingency charges of USD 202 million.

Generic Decline Outweighs Branded Gains in Revenue

Teva Pharmaceutical (NYSE:TEVA) submitted its Quarterly Report for the period ended September 30, 2026 on November 3, 2026. Revenue of USD 4,395 million dropped 2%, chiefly because generic sales fell in the United States, especially lenalidomide capsules, the generic counterpart of Revlimid. The U.S. segment shrank 11% to USD 1,870 million, and segment profit eased to USD 791 million from USD 927 million. Europe expanded 7% to USD 1,319 million with segment profit up 39%, while International Markets rose 6% to USD 592 million and segment profit climbed 32%. Other Activities, which include the Anda distribution business, generated USD 613 million, up 3%, and Anda has been reported outside the U.S. segment since January 1, 2026, with earlier periods restated.

Richer Mix Lifts Margin While Costs and Settlements Rise

The shift toward branded products delivered what management intended. In the United States, AUSTEDO sales reached USD 727 million, AJOVY climbed 88% to USD 138 million, and UZEDY almost doubled with a 96% rise to USD 85 million. Gross margin added 4.1 points to reach 55.5%. Offsetting that, R&D spending increased 16% to USD 297 million, legal settlements and loss contingencies totaled USD 202 million compared with USD 60 million, and net financial expenses reached USD 414 million from USD 237 million. Pre-tax income fell to USD 300 million from USD 646 million, and tax expense was USD 66 million.

Balance Sheet Actions, an Emrusolmin Halt and Pricing Commitments

Debt was USD 16,718 million at September 30, 2026. During the quarter the company retired USD 4,678 million of senior notes ahead of schedule and issued new notes, then repaid USD 1,798 million of 3.15% notes at Maturity in October. Operating Cash Flow was USD 241 million, lower than USD 369 million, while free cash flow, as the company defines it, reached USD 495 million. On the call, management said the emrusolmin Phase II study was halted after an interim futility analysis, with no safety concerns. In October the company also accepted Medicaid price reductions on certain medicines and a prospective most-favored-nation pricing pledge, and it cautioned that Tariff protections might not extend to future products.

Where Things Stand

Margin improved because the revenue mix moved toward higher-profit branded medicines even as generic sales dropped, so the headline has a two-part answer. Teva Pharmaceutical (NYSE:TEVA) said its innovative portfolio rose 33%, according to the CEO, and expects higher full-year guidance on AUSTEDO, AJOVY and UZEDY. Higher financial costs, legal charges and the emrusolmin halt temper the picture. Ordinary shares began trading on the New York Stock Exchange on September 14, 2026, replacing ADSs, and the CEO said the company reached investment-grade status at all three major rating agencies after an S&P upgrade. The BioXcel neuroscience asset purchase closed on October 27, 2026.