Business Overview

Teva is a leading innovative biopharmaceutical company, enabled by a world-class generics business. For over 120 years, the company has been committed to advancing health by developing medicines for the future while championing the production of generics and biologics. Teva operates in 57 markets globally with approximately 37,000 employees.

Our Business Segments

Teva operates through three segments: United States, Europe, and International Markets. Each segment manages the entire product portfolio in its region, including generics, biosimilars, OTC products, and innovative medicines. This structure enables strong alignment and integration between operations, commercial regions, R&D, and global marketing.

Pivot to Growth Strategy

In 2025, Teva continued to execute on the four key pillars of its “Pivot to Growth” strategy, which entered its second phase of “Accelerate Growth.” This phase focuses on growing the innovative portfolio, aligning capital allocation, and optimizing the organization and operations for cost savings.

Macroeconomic and Geopolitical Environment

Teva has been impacted by fluctuating foreign exchange rates, higher inflation and interest rates, and global supply chain disruptions. The company also faces geopolitical tensions, including the ongoing conflict in the Middle East, which has not significantly affected its operations in Israel.

Highlights

Key highlights in Q2 2025 include:

• Revenues of $4,176 million, flat in USD or a 1% decrease in local currency, due to lower generic revenues offset by growth in key innovative products.
• U.S. segment revenues and profit increased by 2% and 12%, respectively.
• Europe segment revenues increased by 7% in USD (3% in local currency) and profit increased by 6%.
• International Markets segment revenues decreased by 17% in USD (16% in local currency) due to the divestment of the Japan business.
• Gross profit margin improved to 50.3% from 48.6%.
• R&D expenses decreased by 9% to $244 million.
• Operating income was $455 million compared to a loss of $5 million in Q2 2024.
• Free cash flow increased to $476 million from $324 million in Q2 2024.

Results of Operations

The report provides detailed financial results and analysis for Teva’s three business segments - United States, Europe, and International Markets - as well as its other activities. Key highlights include:

United States Segment

• Revenues increased 2% to $2,151 million, driven by higher innovative product sales.
• Gross profit margin improved to 58.1% from 55.3%.
• Segment profit increased 12% to $706 million.

Europe Segment

• Revenues increased 7% in USD (3% in local currency) to $1,298 million.
• Gross profit margin decreased to 55.2% from 55.8%.
• Segment profit increased 6% to $364 million.

International Markets Segment

• Revenues decreased 17% in USD (16% in local currency) to $495 million, due to the divestment of the Japan business.
• Gross profit margin improved to 49.2% from 48.3%.
• Segment profit increased 1% to $74 million.

Teva Consolidated Results

• Revenues were flat in USD or decreased 1% in local currency to $4,176 million.
• Gross profit margin improved to 50.3% from 48.6%.
• R&D expenses decreased 9% to $244 million.
• Operating income was $455 million compared to a loss of $5 million in Q2 2024.
• Net income attributable to Teva was $282 million compared to a loss of $846 million in Q2 2024.
• Free cash flow increased to $476 million from $324 million in Q2 2024.

Outlook

Teva continues to execute on its “Pivot to Growth” strategy, focusing on growing its innovative portfolio, optimizing capital allocation, and driving cost savings through organizational transformation. The company faces ongoing macroeconomic and geopolitical challenges but remains committed to addressing patient needs through its diversified business model.