Teva Pharmaceutical Industries Ltd. ( TEVA ) reported its second-quarter 2025 financial results on Wednesday, reflecting a mixed performance amid continued shifts in its portfolio strategy.

The company reported total revenue of $4.20 billion, falling short of analysts’ expectations of $4.29 billion, according to Benzinga Pro. This marks a flat year-over-year result in U.S. dollars, with a slight decline of 1% in local currency terms.

The revenue shortfall was primarily driven by weaker sales in Teva’s generic drug portfolio. Specifically, the decline in generic revenues from its International Markets segment, compounded by the divestment of its Japanese business and a drop in sales from Copaxone, weighed on overall results.

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However, these declines were partially offset by strong sales growth from Teva’s innovative drug offerings, including Austedo, Uzedy, and Ajovy.

Sales of Copaxone, a key multiple sclerosis treatment, fell by 23%, contributing just $62 million in revenue for the quarter. On a more positive note, Teva’s innovative portfolio saw impressive growth.

Austedo, an FDA-approved treatment for tardive dyskinesia, saw a 19% increase in sales, reaching $498 million. Uzedy, used in the treatment of schizophrenia, more than doubled its sales, totaling $54 million. Similarly, Ajovy, a migraine treatment, reported a 31% year-over-year increase, bringing in $155 million.

Teva’s generic segment showed stable performance overall. Global generics revenues declined by 2% in local currency, excluding Japan’s business venture, while U.S. generics saw a 6% drop. In contrast, European generics grew by 1%, and revenues from the International Markets segment fell by 1%.

Teva also reported strong growth in its biosimilars segment. The company attributed this to the robust performance of both existing and newly launched biosimilars. Teva expects this segment to continue growing, with plans to launch two new biosimilars in the second half of 2025. The company is on track to double biosimilars revenues from 2024 to 2027, underscoring its commitment to expanding its portfolio in this rapidly growing sector.

For the second quarter, Teva reported adjusted earnings of 66 cents per share, surpassing analyst estimates of 62 cents per share. The adjusted gross profit margin for the quarter improved to 54.6%, compared to 52.9% in the same period last year, reflecting the favorable mix of higher-margin innovative products.

Teva’s President and CEO, Richard Francis, highlighted the company’s growing portfolio as a key driver of its financial performance. “Teva’s performance this quarter stands as a testament to the exceptional strength of our innovative portfolio, which remains the primary engine driving our revenue growth,” Francis said. “Our key innovative products delivered a 26% increase in local currency, demonstrating their impact on our financial trajectory and value to patients.”

During the earnings conference call, Francis stated that 70% of Teva’s generics business operates outside the U.S., while its most innovative business is U.S.-based. On the supply chain, Teva has no reliance on China and a very small presence in India.

Teva’s CFO Eli Kalif confirmed that U.S. tariffs are absorbed into their 2025 non-GAAP outlook, indicating proactive financial planning to manage these impacts.

Outlook

Teva Pharmaceutical narrowed its fiscal 2025 adjusted earnings guidance to a range of $2.50-$2.60 per share from $2.45-$2.65 per share, slightly below the consensus estimate of $2.53.

The company also reaffirmed its full-year sales guidance of $16.8 billion-$17.2 billion, slightly lower than the consensus expectation of $17.01 billion.

This outlook takes into account the potential impact of tariffs and trade uncertainties within the pharmaceutical sector.

Teva raised its sales outlook for several key products. The sales forecast for Austedo in 2025 was increased to between $2 billion and $2.05 billion, up from the prior estimate of $1.95-$2.05 billion.

Similarly, the company now expects Ajovy sales to reach $630 million-$640 million, surpassing its earlier guidance of $600 million.

Sales expectations for Uzedy were also raised from approximately $160 million to a range of $190-$200 million. Teva also expects around $370 million in sales from Copaxone in 2025.

For its operating income and adjusted EBITDA, Teva reaffirmed its guidance range of $4.3 billion-$4.6 billion and $4.7 billion-$4.5 billion, respectively.

The company remains focused on executing its long-term strategy, which includes building a $5 billion innovative medicines franchise by 2030, supported by its key assets and promising late-stage pipeline.

As the company continues its pivot toward innovative therapies, it remains to be seen how it will navigate potential headwinds, including tariff impacts and competition in both its generic and biosimilar segments.

Price Action: TEVA stock is trading higher by 2.36% to $16.94 at last check Wednesday.

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