U.S. markets will remain shut on Sunday. Teva ADRs closed Friday at $30.81, falling 3.8% over the week.
Consensus for pre-Emalex Q2 stands at $4.058 billion in revenue and non-GAAP EPS of $0.59.
Emalex’s $700 million charge is expected to affect Q2 results by approximately $0.59 per share.
Teva Pharmaceutical Industries NYSE:TEVA is set to release its second-quarter results on Wednesday, featuring an atypical split in earnings. Underlying business performance could strengthen, but reported non-GAAP earnings are expected to approach zero.
Teva’s June memo indicated a pre-Emalex consensus of $0.59 per share. It also attributed $0.59 per share to the acquisition’s impact in Q2. These figures nearly offset each other.
The latest consensus forecast is $0.05 per share. Projections span from a loss of three cents to a profit of 13 cents. Investors are watching revenue, margins, and cash flow as clearer markers of performance.
The benchmark continues to indicate progress on a sequential basis:
Metric
Q1 2026 actual
Q2 consensus before Emalex
Sequential change
Revenue
$3.982 billion
$4.058 billion
+1.9%
Austedo sales
$578 million
$588 million
+1.7%
Ajovy sales
$196 million
$187 million
-4.6%
Uzedy sales
$63 million
$68 million
+7.9%
Free cash flow
$188 million
$367 million
+95.2%
Non-GAAP EPS
$0.53
$0.59
+11.3%
Virtua Research consensus estimates as of June 17 were used for Q2 figures. Sequential comparisons are based on Teva’s published first-quarter results.
Revenue is projected to increase 1.9% from the previous quarter, with free cash flow set to almost double. This aligns with Teva’s previously announced strategy of incremental quarterly progress.
The three growth brands reported $837 million in revenue for Q1. For Q2, the consensus estimate is $843 million, marking an increase of only 0.7%. Performance is stable rather than impressive.
The midpoint for the full year for those brands stands at $3.51 billion. Based on calculations, the average for H2 would need to reach roughly $915 million per quarter. This figure is 8.5% ahead of the Q2 consensus.
The bulk of the increase came from Austedo, with Q1 sales climbing to $578 million, a 41% rise in local currency. Ajovy advanced 35%, and Uzedy jumped 62%.
Chris Schott, an analyst at JPMorgan Chase NYSE:JPM, described the core assets as “growing nicely” following the first quarter. Schott also noted an “attractive setup for shares” as growth is expected to strengthen after 2026. Reuters
Branded growth is required to offset a significant drop in generics. Global generics sales declined 16% in constant currency in Q1. Teva projects a loss of over $1 billion in lenalidomide revenue this year.
A new policy risk surfaced last week. President Donald Trump announced that imported generics will not face tariffs for the next two years. Tariff rates will climb to 100% in 2028, and to 200% after that.
Sandoz Group SWX:SDZ stated the proposal is still insufficiently detailed to evaluate. Teva earlier indicated its operations in the U.S., Israel, and Europe provided stronger safeguards. The updated tariff list is more extensive.
Which earnings metric investors select also affects the valuation. On Friday, the share price represented 15.3 times the midpoint of the reported 2026 forecast. Based on Teva’s independent outlook, the ratio drops to 11.5 times.
Wall Street sentiment stays upbeat. Thirteen analysts have rated Teva as Buy or Overweight, with none assigning a neutral stance. The consensus price target is $41.75, representing a 35.5% premium to Friday’s closing price.
Cash conversion will also be key. Teva faces $1.798 billion in notes maturing on October 1. Additionally, the company anticipates $379 million in opioid settlement payments in 2026.
Risks: The Emalex expense may conceal an actual operational shortfall. Lower Austedo sales, susceptibility to tariffs, or weak cash generation would weigh on shares. Debt and settlement payments limit flexibility.
Teva is scheduled to report results at 7:00 a.m. ET on Wednesday, with a conference call set to begin at 8:00 a.m. ET. Analysts are watching for combined branded sales, expected at $843 million, which could be more significant than EPS.
What is expected from Teva in its second-quarter results on Wednesday?
Wall Street expects revenue of about $4.05 billion. Consensus public EPS projections range from $0.05 to $0.08, post-Emalex adjustment. Teva’s June consensus EPS was $0.59 before an approximate $0.59 impact from acquisition. The standard gross margin expectation is set at 54.7%. The revenue forecast signals a decline of about 3% from a year earlier. Results will be released at 7 a.m. ET, with the conference call scheduled for 8 a.m.
Will Austedo, Ajovy and Uzedy continue to drive growth?
This is necessary, particularly in the latter two quarters. Q2 consensus forecasts are $588 million for Austedo, $187 million for Ajovy, and $68 million for Uzedy. Altogether, sales would total $843 million, just topping the approximately $838 million reported in Q1. The full-year consensus for these three products is around $3.58 billion, implying a requirement of close to $950 million per quarter in the second half. A moderate outperformance in Q2 would ease the significant pressure on the back half.
Is management set to upgrade its 2026 guidance, or simply confirm it?
A reaffirmation appears more probable than a significant upward revision. The company currently forecasts revenue of $16.4–$16.8 billion and adjusted EPS between $1.91 and $2.11. The EPS guidance factors in a $0.66 decrease related to Emalex. Free cash flow is maintained in the $2.0 billion to $2.4 billion range. Analyst consensus is near $16.56 billion for revenue and $2.03 for EPS, both nearly at midpoint levels. Investors could pay closer attention to Austedo’s sales outlook, guided at $2.4–$2.55 billion. (Teva Pharmaceuticals)
What is Teva’s level of exposure to the latest U.S. tariff scheme for generic drugs?
Short-term exposure is restricted, but the long-term threat could be significant. Imported generics would not face tariffs until August 2028. Tariffs would then increase to 100% for a year, followed by 200%. The proposal remains subject to modification, and precise exemption details have not been given. Teva reported a 28% decline in U.S. generic revenue to $612 million in Q1. The company's management faces pressure to clarify manufacturing risk, contract terms, and potential actions regarding U.S. production capacity. (Reuters)
Is Teva’s generics business downturn now showing signs of stabilization?
Teva is not there yet, though the squeeze continues to tighten. Generic drug revenue worldwide dropped 16% in local currencies in Q1. Sales in the U.S. were hit largely as lenalidomide faced stiffer rivalry. When lenalidomide and the Japan sale are excluded, Teva projects growth in the low single digits for local currencies. Biosimilars are aimed to counterbalance, with revenue estimated at approximately $800 million by 2027. Investors require proof that the base generics segment is levelling off before that goal can be reached. (Teva Pharmaceuticals)
Will Teva be able to keep cutting debt following its $700 million expenditure on Emalex?
Likely, although the tolerance for mistakes has diminished. Teva finished March with gross debt totaling around $16.7 billion and net debt of $12.9 billion. A $1.8 billion bond comes due on October 1. The company anticipates about $379 million in opioid-settlement payments in 2026. Free cash flow reached $188 million in Q1, and further quarterly improvement is projected. An update on Wednesday is expected to provide more detail on its repayment strategy following the cash acquisition of Emalex. (Q4 Networks)
What upcoming pipeline catalyst could act as a driver for Teva’s share price?
Olanzapine LAI stands out as the main upcoming catalyst, with an FDA verdict anticipated in the fourth quarter. Teva aims for peak sales between $1.5 billion and $2.0 billion for its long-acting injectable portfolio, a goal that relies on regulatory approval and strong market adoption. The application for Ecopipam in Tourette syndrome proceeded in June. TEV-408 is set to start Phase 2b testing in vitiligo in Q4, following positive results from open-label trials.
Following its 12-month surge, does Teva remain appealing from a valuation standpoint?
Teva's valuation has improved, moving away from distressed levels, but analysts continue to anticipate further gains. Teva ended Friday trading at $30.81, putting its market cap around $36.3 billion. Shares have advanced about 89% over the past year and remain roughly 18% under the 12-month peak of $37.35. The current price reflects an estimated 15 times the $2.03 adjusted earnings consensus. The mean analyst target of $41.75 indicates potential upside of around 36%. (Google)
Michał Rogucki is a senior markets reporter at TS2.tech. His coverage ranges from stocks and technology to economic developments affecting global markets. He graduated from Humboldt University of Berlin and worked in investment research and market analysis before becoming a financial journalist.
