Categories Earnings, Health Care

Teva Pharma sinks on Q1 revenue miss amid generic competition; earnings beat

Drugmaker Teva Pharmaceutical (NYSE: TEVA) reported a decline in first-quarter adjusted earnings, owing to a 15% fall in revenues as the company continues to face stiff competition in the generic market. Though earnings surpassed analysts’ forecast, the stock dropped early Thursday.Teva Pharmaceutical Q1 2019 earnings infographic

Earnings, excluding one-off items, dropped to $0.60 per share from $0.94 per share in the first quarter of last year but came in above the forecast. On a reported basis, the company posted a net loss of $105 million or $0.10 per share for the March quarter, compared to a profit of $1.1 billion or $1.03 per share a year earlier.

The bottom line was dragged by unfavorable currency exchange rates and a 15% decrease in revenues to $4.29 billion, hurt mainly by stiff competition to the company’s flagship product Copaxone. The top-line slump can also be attributed to lower sales of respiratory products and general weakness in the US generics business. Revenues fell short of the market’s prediction.

The bottom line was impacted by unfavorable currency exchange rates and a 15% decrease in revenues to $4.29 billion

In North America, there was a 19% fall in revenues mainly due to muted demand for Copaxone, which was partially offset by a strong performance by Anda, Asutedo and the recently launched Ajovy. Copaxone’s slowdown impacted the European operations also, with revenues falling about 12%. Revenues from the international market were down 11% year-on-year, with Japan being the primary contributor to the contraction.

Also see: Pfizer Q1 profit tops expectations, raises FY19 earnings outlook

The squeeze on margins was partially offset by a decline in operating expenses. Selling and marketing expenses dropped by 12%, while general and administrative expenses decreased 11%. There was an 18% fall in R&D expenses.

Also Read:  Cantel Medical Corp. (NYSE: CMD) Q4 2020 Earnings Call Transcript

Kare Schultz, Teva’s CEO, said, “We faced the expected loss of exclusivities of key products COPAXONE and ProAir to generic competition. Our focus is on stabilizing our global generics business and ensuring the success of our long-term organic growth drivers, especially AJOVY and AUSTEDO.”

Meanwhile, the management reaffirmed its previously issued full-year revenue and earnings guidance. Teva said it achieved spend-base reduction of about $2.5 billion since launching the restructuring program last year and expects to raise the amount to $3 billion by year-end.

For long, Teva’s performance at the stock market has been dismal as it remained in a perpetual downward spiral, all along underperforming the industry. The stock declined by 15% since last year and hit an 18-month low recently. It lost about 2% following the earnings report Thursday.

Follow our Google News edition to get the latest stock market, earnings and financial news at your fingertips

Most Popular

Highlights of Aurora Cannabis (ACB) Q4 2020 earnings report

Aurora Cannabis, Inc. (NYSE: ACB) reported a wider loss for the fourth quarter of 2020, hurt by a 5% decrease in revenues. The company’s stock fell sharply during Tuesday’s after-hours

Infographic: Stitch Fix Q4 2020 earnings

Stitch Fix (NASDAQ: SFIX) reported fourth-quarter 2020 financial results after the closing bell on Tuesday. The company reported an 11% increase in Q4 revenues to $443.4 million, beating Wall Street

Nike Inc. (NKE) stock spikes after beating Q1 2021 estimates

Nike Inc.'s (NYSE: NKE) profit and revenue in the first quarter of fiscal 2021 surpassed the market's estimates and sent the NKE stock up by about 7% in the extended