01—Abstract
Summary
Summary of the 10-Q filed July 29, 2026. Cited figures are marked; the original filing is the authoritative source.
Teva Pharmaceutical Industries Limited's 10-Q for the quarter ended June 30, 2026 shows a swing to a loss in the second quarter, driven mainly by a large acquired IPR&D charge.
Net revenues were $4,142 milliona, down from $4,176 million a year earlier, and gross profit was $2,153 million. R&D expenses rose to $970 million from $244 million, primarily due to the Emalex Biosciences acquisition of ecopipam (EBS-101), which was recorded as a $724 million acquired IPR&D expense. Operating loss was $231 million versus operating income of $455 million in the prior-year quarter, and net loss attributable to Teva was $576 million, or $0.49 per diluted share, compared with net income of $282 million and $0.24 per diluted share a year earlier.
Legal settlements and loss contingencies expense was $230 millionb for the quarter. Segment results were uneven. The United States segment reported a loss of $76 million, down from a profit of $699 million, mainly because of the Emalex-related R&D expense, even though its gross margin improved to 70.7% from 67.8%.
Generic products in the U.S. fell 31% as lenalidomide competition intensified, while AUSTEDO (+37%) and AJOVY (+83%) grew. Europe and International Markets segment profits rose to $367 millionc and $99 million, respectively. Cash flow from operations was $411 million in the quarter, compared with $227 million a year earlier.
Balance sheet highlights include short-term debt rising to $4,500 milliond from $1,820 million as senior notes approach maturity, while long-term senior notes and loans fell to $12,092 million from $14,986 million. Total debt was $16,593 million, and cash and cash equivalents were $3,655 million. The filing also discloses the planned termination of the ADS program, with ordinary shares to list directly on the NYSE under the symbol TEVA around September 14, 2026, and a board instruction to plan a potential share repurchase program.
02—Key points
Key Highlights
- Net loss attributable to Teva of $576 million ($0.49 per diluted share) in Q2 2026, versus net income of $282 million ($0.24 per diluted share) in Q2 2025.
- Net revenues of $4,142 million in Q2 2026, down slightly from $4,176 million, with U.S. generic products down 31% on lenalidomide competition.
- R&D expenses of $970 million, up from $244 million, driven by the $724 million acquired IPR&D charge from the Emalex Biosciences acquisition (ecopipam, EBS-101).
- Operating loss of $231 million in Q2 2026 versus operating income of $455 million a year earlier; legal settlements and loss contingencies totaled $230 million.
- U.S. segment posted a loss of $76 million versus a profit of $699 million, while Europe ($367 million) and International Markets ($99 million) segment profits increased.
- Growth in key innovative products: AUSTEDO revenue in the U.S. rose 37% and AJOVY revenue rose 83% in Q2 2026.
- Short-term debt rose to $4,500 million from $1,820 million, while total debt was $16,593 million; the company repaid $23 million of convertible debentures and states it expects sufficient cash resources to meet obligations within one year.
03—One dollar
Follow one dollar
For each $1.00 of revenue in Q2 FY2026, Teva Pharmaceutical Industries lost $0.14.
- Revenue$4.14B100.0%
- Cost of revenue−$1.99B48.0%
- Gross profit$2.15B52.0%
- Operating costs−$2.38B57.6%
- Operating income−$231.0M5.6%
- Interest, other & tax−$345.0M8.3%
- Net income−$576.0M13.9%
04—Financials
Financial Highlights
Figures from 10-QQ2 FY2026filed July 29, 2026Financial Statements
Q2 FY2026 against Q2 FY2025
| Line item | Q2 FY2026Q2 FY2025 | Change |
|---|---|---|
| Revenue | $4.14B$4.18B | −0.8% |
| Cost of Revenue | $1.99B$2.07B | −4.1% |
| Gross Profit | $2.15B$2.10B | +2.4% |
| Operating Income | -$231.00M$455.00M | −150.8% |
| Net Income | -$576.00M$282.00M | −304.3% |
| EPS (Basic) | $-0.49$0.25 | −296.0% |
| EPS (Diluted) | $-0.49$0.24 | −304.2% |
| Shares Outstanding (Basic) | 1.17B1.15B | +1.6% |
| Shares Outstanding (Diluted) | 1.17B1.16B | +0.3% |
05—Questions
Frequently Asked Questions
What drove the swing from profit to loss in the second quarter of 2026?
The filing attributes the change mainly to higher R&D expenses of $970 million, primarily from the acquisition of Emalex Biosciences and its primary asset ecopipam (EBS-101), which was accounted for as an asset acquisition with a $724 million acquired IPR&D expense. The acquired IPR&D charge was also non-deductible for tax purposes, contributing to a $121 million tax expense on a pre-tax loss of $455 million.
How did Teva's segments perform?
The United States segment reported a loss of $76 million in Q2 2026 compared with a profit of $699 million a year earlier, mainly due to the Emalex-related R&D expense, despite a gross margin of 70.7%. Europe segment profit rose to $367 million from $364 million, and International Markets segment profit rose to $99 million from $74 million.
What is happening with Teva's debt and liquidity?
Short-term debt increased to $4,500 million at June 30, 2026, from $1,820 million at December 31, 2025, largely because current maturities of long-term liabilities rose, while senior notes and loans fell to $12,092 million. Cash and cash equivalents were $3,655 million, and the $1.8 billion revolving credit facility had no amounts outstanding. The company expects to have sufficient cash resources to support debt service and other obligations within one year.
Will there be changes to how Teva's shares trade?
Yes. Teva instructed Citibank to terminate its ADS program, with the termination expected at the open of business in New York on September 14, 2026. Holders of ADSs will receive economically equivalent ordinary shares listed directly on the NYSE under the same symbol, TEVA, and the shares will continue to trade on the Tel Aviv Stock Exchange. The filing notes that implementation remains subject to management discretion and third-party readiness.
Has Teva announced a share repurchase program?
Not yet. Teva did not repurchase shares in the quarter. In April 2026 its Board instructed management to plan a share repurchase program that may be implemented subject to legal requirements, market conditions and other investment opportunities, and any future repurchases require Board approval.
06—Continue