01—Abstract
Summary
Summary of the 8-K filed January 29, 2025. Cited figures are marked; the original filing is the authoritative source.
Teva Pharmaceutical Industries Ltd. (NYSE and TASE: TEVA) reported full-year 2024 revenues of $16,544 milliona, an increase of 4% in U.S. dollars and 6% in local currency compared to 2023, driven by generic products across all segments, AUSTEDO, UZEDY and AJOVY, partially offset by an upfront payment of $500 million received in 2023 tied to the duvakitug (anti-TL1A) collaboration.
The company reported a GAAP net loss attributable to Teva of $1,639 millionb, or $1.45 per share, compared with a loss of $559 million, or $0.50 per share, in 2023, largely due to higher income taxes and higher operating loss. Non-GAAP diluted EPS was $2.49 versus $2.56 in 2023, and adjusted EBITDA was $4,781 million versus $4,818 million. Full-year free cash flow was $2,068 million, and total debt declined to $17,783 million from $19,833 million.
For the fourth quarter, revenues were $4,229 millionc, a decrease of 5% in both U.S. dollars and local currency, mainly reflecting the 2023 duvakitug upfront payment. The GAAP net loss attributable to Teva was $217 million ($0.19 per share), including goodwill impairment of $280 million related to the API reporting unit, while non-GAAP diluted EPS was $0.71. The company stated it continues to pursue a sale of its API business, which was classified as held for sale on December 31, 2024, and that it expects to sell its business venture in Japan with a closing date of April 1, 2025.
Management guided 2025 revenues of $16.8 to $17.4 billiond, non-GAAP diluted EPS of $2.35 to $2.65, and free cash flow of $1.6 to $1.9 billion. The outlook assumes a full-year contribution from the API business and the Japan venture and excludes potential milestone payments from Sanofi tied to the Phase 3 start of duvakitug.
02—Key points
Key Highlights
- FY 2024 revenues of $16.5 billion, up 4% in U.S. dollars and 6% in local currency, the company's second consecutive year of growth
- GAAP net loss attributable to Teva widened to $1,639 million ($1.45 per share) from $559 million ($0.50 per share) in 2023, mainly due to higher income taxes and higher operating loss
- Non-GAAP diluted EPS of $2.49 for FY 2024 versus $2.56 in 2023; Q4 2024 non-GAAP diluted EPS was $0.71 versus $1.00 a year earlier
- Free cash flow of $2,068 million in 2024 versus $2,387 million in 2023; operating cash flow was $1,247 million
- Total debt reduced to $17,783 million at December 31, 2024 from $19,833 million, following repayment at maturity of $1,641 million of senior notes
- AUSTEDO revenues exceeded $1.6 billion for 2024 (up 34% in the U.S. segment), with AJOVY at $507 million globally and UZEDY at $117 million in the U.S.
- 2025 outlook: revenues of $16.8 to $17.4 billion, non-GAAP operating income of $4.1 to $4.6 billion, and non-GAAP diluted EPS of $2.35 to $2.65
03—Questions
Frequently Asked Questions
Why did Teva report a larger GAAP net loss in 2024 despite revenue growth?
The filing attributes the larger net loss attributable to Teva ($1,639 million vs. $559 million in 2023) mainly to higher income taxes ($676 million expense on a pre-tax loss of $1,284 million) and a higher operating loss ($303 million vs. operating income of $433 million). The operating loss reflected higher goodwill and other asset impairment charges, including a $1,280 million goodwill impairment related to the Teva API reporting unit, and higher S&M expenses.
How did the 2023 duvakitug upfront payment affect the comparison with 2024?
Teva received a $500 million upfront payment in 2023 related to its collaboration on duvakitug (anti-TL1A). Its absence in 2024 was a main reason for the lower fourth-quarter revenues (down 5%) and lower gross profit margin, and it also weighed on 2024 operating cash flow, which the company said decreased mainly due to this item.
What is the status of the API business sale and the Japan business venture?
Teva classified its API business as held for sale on December 31, 2024, and continues to engage with prospective purchasers; the consummation of a sale remains contingent on a definitive agreement approved by the Board. Separately, Teva agreed on December 5, 2024 to sell its Japan business venture to JKI Co. Ltd., with an expected closing date of April 1, 2025, subject to standard closing conditions. The 2025 outlook assumes a full-year contribution from both.
What drove growth in the company's key innovative and generic products?
For 2024, the U.S. segment's generic products revenues rose 15% to $3,599 million, and AUSTEDO revenues rose 34% to $1,642 million in the U.S. segment, driven by volume growth and expanded patient access. Teva also launched the first generic version of Sandostatin LAR Depot and an authorized generic of Victoza, and its biosimilar pipeline now includes 18 assets, including SELARSDI, expected to launch in the U.S. in the first quarter of 2025.
What does the 2025 outlook assume, and what could affect it?
The 2025 outlook assumes a full-year contribution from Teva API and the Japan business venture, and excludes expected income from potential Sanofi milestone payments tied to the Phase 3 initiation of duvakitug. The company also guided to free cash flow of $1.6 to $1.9 billion and a non-GAAP tax rate of 15% to 18%, and cautions that volatile foreign exchange swings can negatively affect revenue and income.
04—Continue