EX-99.1 2 exhibit991-2q26earningsrel.htm EX-99.1 Document Viatris Reports Second-Quarter 2026 Financial Results • Delivers Total Revenues of $3.8 Billion, Representing 5% Reported Growth Compared to Second Quarter 2025 and a U.S. GAAP Net Loss of $119 Million • Total Revenues Were Up 3.5% Operationally Compared to Second Quarter 2025 • Adjusted EBITDA was $1.2 Billion, Up 8% Operationally Compared to Second Quarter 2025 • Advances Key Pipeline Milestones, Including U.S. FDA Approval of Gwyn Lo TM • Announces Sale of Global Rights to Tyrvaya ® • Returns Approximately $550 Million of Capital to Shareholders, Including Through Share Repurchases; Reduces Gross Leverage Ratio to 2.9x • Raises 2026 Financial Guidance Midpoints for All Metrics [1] PITTSBURGH – August 6, 2026 – Viatris Inc. (Nasdaq: VTRS), a global healthcare company, today announced its second-quarter 2026 financial results. Executive Commentary “Our second-quarter results reflect another quarter of strong execution and reinforce the momentum we're building across our business,” said Scott A. Smith, CEO, Viatris . “Commercial execution, pipeline progress and the early benefits of our enterprise-wide strategic review continue strengthening our business and improving our financial performance. Our strong first-half results give us the confidence to raise our full-year guidance. We expect a more balanced operating environment in the second half of the year and we remain focused on disciplined execution, investing behind our future growth drivers and creating long-term value for patients and shareholders.” “We delivered another strong quarter of Total Revenues and Adjusted EBITDA growth over the prior year, reflecting continued strong operational execution,” said Paul Campbell, Interim CFO, Chief Accounting Officer & Corporate Controller, Viatris . “At the same time, we continued to execute on our balanced capital allocation strategy, returning approximately $550 million to shareholders, including approximately $270 million of share repurchases occurring through early August. In addition, we further strengthened our balance sheet and reduced our gross leverage ratio to 2.9x.” [1] Viatris is not providing forward-looking guidance for U.S. GAAP net earnings (loss) or U.S. GAAP diluted EPS (loss) or a quantitative reconciliation of its 2026 Adjusted EBITDA or Adjusted EPS guidance. U.S. GAAP net cash provided by operating activities for 2026 is estimated to be between $1.9 billion and $2.1 billion, with a midpoint of approximately $2.0 billion. 2026 financial guidance ranges as provided on August 6, 2026, exclude the impact of any transaction-related and restructuring-related costs (as defined below) and acquired IPR&D for unsigned deals as they cannot be reasonably forecasted. Please see “2026 Financial Guidance” and “Non-GAAP Financial Measures” for additional information. Second-Quarter Results Three Months Ended June 30, (Unaudited; in millions, except %s and per share amounts) 2026 2025 Reported Change Operational Change (1) (2) Total Revenues $ 3,756.8  $ 3,582.1  5% 4% Total Net Sales $ 3,745.9  $ 3,569.0  5% 4% Developed Markets 2,193.7  2,119.3  4% 2% Emerging Markets 542.3  555.1  (2)% (2)% JANZ 296.1  305.7  (3)% —% Greater China 713.8  588.9  21% 16% Net Sales by Product Category Brands $ 2,418.4  $ 2,284.5  6% 4% Generics 1,327.5  1,284.5  3% 3% U.S. GAAP Gross Profit $ 1,456.5  $ 1,332.9  9% U.S. GAAP Gross Margin 38.8  % 37.2  % Adjusted Gross Profit (2) $ 2,158.9  $ 2,028.4  6% Adjusted Gross Margin (2) 57.5  % 56.6  % U.S. GAAP Net Loss $ (118.8) $ (4.6) NM U.S. GAAP Loss Per Share $ (0.10) $ —  NM Adjusted Net Earnings (2) $ 808.5  $ 726.0  11% Adjusted EPS (2) $ 0.69  $ 0.62  11% 9% EBITDA (2) $ 729.0  $ 577.8  26% Adjusted EBITDA (2) $ 1,188.3  $ 1,078.8  10% 8% U.S. GAAP Net Cash Provided by Operating Activities $ 381.8  $ 219.7  74% Capital Expenditures 52.8  52.9  —% Free Cash Flow (2)(3) $ 329.0  $ 166.8  97% ___________ (1)     See “Certain Key Terms and Presentation Matters” in this release for more information. (2)     Non-GAAP financial measures. See "Non-GAAP Financial Measures" for additional information. (3)     Excluding the impact of transaction-related and restructuring-related costs of $120 million, free cash flow for the three months ended June 30, 2026, was $449 million. Excluding the impact of transaction-related costs of $74 million, free cash flow for the three months ended June 30, 2025, was $241 million. 2 Six Months Ended June 30, (Unaudited; in millions, except %s and per share amounts) 2026 2025 Reported Change Operational Change (1) (2) Total Revenues $ 7,273.8  $ 6,836.4  6% 3% Total Net Sales $ 7,255.6  $ 6,812.2  7% 3% Developed Markets 4,214.5  4,011.0  5% 1% Emerging Markets 1,077.7  1,075.0  —% (1)% JANZ 569.5  581.8  (2)% (1)% Greater China 1,393.9  1,144.4  22% 17% Net Sales by Product Category Brands $ 4,750.9  $ 4,401.4  8% 4% Generics 2,504.7  2,410.8  4% 2% U.S. GAAP Gross Profit $ 2,613.7  $ 2,494.1  5% U.S. GAAP Gross Margin 35.9  % 36.5  % Adjusted Gross Profit (2) $ 4,129.2  $ 3,848.0  7% Adjusted Gross Margin (2) 56.8  % 56.3  % U.S. GAAP Net Earnings (Loss) (3) $ 57.6  $ (3,046.6) NM U.S. GAAP Earnings (Loss) Per Share (3) $ 0.05  $ (2.58) NM Adjusted Net Earnings (2) $ 1,502.6  $ 1,326.3  13% Adjusted EPS (2) $ 1.28  $ 1.11  15% 11% EBITDA (2) $ 1,277.9  $ (1,739.0) NM Adjusted EBITDA (2) $ 2,237.8  $ 2,002.3  12% 9% U.S. GAAP Net Cash Provided by Operating Activities $ 770.1  $ 755.2  2% Capital Expenditures 92.7  95.5  (3)% Free Cash Flow (2)(4) $ 677.4  $ 659.7  3% ___________ (1)      See “Certain Key Terms and Presentation Matters” in this release for more information. (2)     Non-GAAP financial measures. See “Non-GAAP Financial Measures” for additional information. (3)     For the six months ended June 30, 2025, includes the previously disclosed goodwill impairment charge of $2.9 billion as a result of the interim goodwill impairment test performed as of March 31, 2025. (4)     Excluding the impact of transaction-related and restructuring-related costs of $231 million, free cash flow for the six months ended June 30, 2026, was $908 million. Excluding the impact of transaction-related costs of $116 million, free cash flow for the six months ended June 30, 2025, was $776 million. Financial Highlights for the Second Quarter of 2026 • Total revenues were $3.8 billion, up 5% on a reported basis and up 3.5% on an operational basis compared to second-quarter 2025 results, primarily driven by new product sales in Developed Markets and strong growth in Greater China. • Brands net sales reflect continued strength in Greater China and Emerging Markets. • Generics net sales reflect contributions from new product launches, in addition to growth in certain products in Developed Markets, partially offset by supply constraints in the ARV business within Emerging Markets. 3 • The Company generated approximately $101 million in new product revenues (approximately $172 million for the year) and continues expecting to deliver approximately $450 million to $550 million in new product revenues in full-year 2026. • U.S. GAAP net loss was $119 million compared to U.S. GAAP net loss of $5 million in the second quarter of 2025 and U.S. GAAP diluted loss per share was $(0.10) compared to a loss of less than $(0.01) per share in the second quarter of 2025. The loss in the second quarter of 2026 was primarily driven by a non-cash charge of $177.8 million related to the planned sale of the product rights for Tyrvaya ® and the write down of that intangible asset to fair value, less cost to sell. • Adjusted EBITDA was $1.2 billion, up 10% on a reported basis and up 8% on an operational basis compared to the second quarter of 2025, and adjusted EPS was $0.69 per share, up 11% on a reported basis and up 9% on an operational basis compared to the second quarter of 2025. • The Company generated U.S. GAAP net cash provided by operating activities of $382 million ($770 million for the year) and free cash flow, excluding the impact of transaction-related and restructuring-related costs, of $449 million ($908 million for the year). Additional Highlights • In August, the Company signed a definitive agreement to sell the global product rights for Tyrvaya to Harrow, Inc., a leading provider of ophthalmic disease management solutions in North America, for an upfront payment of $30 million and an additional $70 million in commercial contingent milestone payments. The transaction reflects the Company's continued focus on prioritizing its capital, talent and resources toward opportunities it believes offer the greatest long-term growth potential. • In July, the Company announced that the U.S. Food and Drug Administration (FDA) approved Gwyn Lo TM (norelgestromin and ethinyl estradiol transdermal system), a new combined hormonal contraceptive patch with low-dose estrogen. The Company expects Gwyn Lo to be commercially available later this year. • In July, the Company completed the sale of its equity position in Biocon Limited for a pre-tax total consideration of approximately $380 million. The pre-tax sale proceeds include the impacts of an approximate 2.7% block sale discount to market, transaction fees and the strengthening of the U.S. dollar since the Company obtained the equity in January 2026. This sale completes the Company’s monetization of its stake in Biocon Biologics Limited for a total of approximately $780 million. • In June, the FDA approved the Company’s generic ferric carboxymaltose injection in three strengths: 750 mg/15 mL, 1000 mg/20 mL and 100 mg/2 mL. Ferric carboxymaltose is a substitutable generic version of Injectafer ® , which is indicated for the treatment of iron deficiency anemia and non-dialysis dependent chronic kidney disease, and iron deficiency. • In June, the Company announced positive top-line results from a Phase 3 clinical trial evaluating the efficacy and safety of VR-205 (targeted-release budesonide formulation) (Nefecon ® ) in Japanese adult patients with primary immunoglobulin A nephropathy at risk of developing end-stage renal disease. 4 • In May, the FDA inspected the Company’s oral solid dose manufacturing facility in Nashik, India, and issued Form 483 observations. The Company responded to the Form 483 observations and promptly initiated a comprehensive remediation plan. The Company has also engaged independent third-party subject matter experts to support its remediation plan. Activities under the remediation plan are ongoing and have led to intermittent disruptions at the facility. While production at the facility has resumed, the temporary manufacturing suspension due to the fire at the facility in February along with these intermittent disruptions are expected to impact product supply in the second half of the year. The Company currently anticipates the impact of product supply disruptions to be between $100 million and $150 million to total revenues in the second half of 2026. • In May, the Company announced that the FDA accepted for review the New Drug Application for MR-107A-02 (fast-acting meloxicam), a non-opioid, for the treatment of moderate-to-severe acute pain. The FDA has assigned a PDUFA goal date of December 27, 2026. • The Company signed a distribution agreement with Accord Healthcare to commercialize three biosimilar products (filgrastim, ustekinumab, teriparatide) in France. In addition, the Company signed a co-promotion partnership with Idorsia Ltd. for Quvivq ® in Italy and Canada. These transactions reflect the Company's disciplined business development strategy of expanding its portfolio through complementary, accretive products that leverage its regional capabilities and commercial strengths. Capital Allocation Through August 5, 2026, the Company has returned approximately $550 million of capital to shareholders, including approximately $270 million through share repurchases at a weighted average purchase price of $16.42 per share. The Company has approximately $730 million remaining under its existing board-authorized share repurchase program, providing continued flexibility to return additional capital to shareholders. The Company repaid approximately $900 million of debt that matured in June 2026, refinancing the remaining balance with a public offering of €650 million aggregate principal amount of 4.250% euro-denominated senior notes due 2033. As a result, the Company ended the quarter with a gross leverage ratio of 2.9x. 2026 Financial Guidance Viatris is raising the midpoints of its 2026 financial guidance ranges, each as set forth below. The Company is not providing forward-looking guidance for U.S. GAAP net earnings (loss) or U.S. GAAP diluted earnings (loss) per share (EPS) or a quantitative reconciliation of its 2026 adjusted EBITDA or adjusted EPS guidance to the most directly comparable U.S. GAAP measures, U.S. GAAP net earnings (loss) or U.S. GAAP diluted EPS, respectively, because it is unable to predict with reasonable certainty the ultimate outcome of certain significant items, including integration, acquisition and divestiture-related expenses, restructuring expenses, asset impairments, litigation settlements, future share repurchases, and other contingencies, such as changes to contingent consideration, acquired IPR&D and certain other gains or losses as well as related income tax accounting, because certain of these items have not occurred, are out of the Company’s control and/or cannot be reasonably predicted without unreasonable effort. These items are uncertain, depend on various factors, and could have a material impact on U.S. GAAP reported results for the guidance period. With respect to the Estimated Ranges as provided on August 6, 2026, U.S. GAAP net cash provided by operating activities for 2026 is estimated to be between $1.9 billion and $2.1 billion, with a midpoint of approximately $2.0 billion. With respect to the Estimated Ranges reaffirmed on May 7, 2026, U.S. GAAP net cash provided by operating activities for 2026 was estimated to be between $1.7 billion and $2.0 billion, with a midpoint of approximately $1.85 billion. 5 (In millions, except Adjusted EPS) Estimated Ranges (2) May 7, 2026 Midpoint (2) May 7, 2026 Estimated Ranges (3) August 6, 2026 Midpoint (3) August 6, 2026 Total Revenues $14,450 - $14,950 $14,700 $14,550 - $14,950 $14,750 Adjusted EBITDA (1) $4,150 - $4,450 $4,300 $4,300 - $4,500 $4,400 Adjusted EPS (1) $2.33 - $2.47 $2.40 $2.45 - $2.59 $2.52 Free Cash Flow (1) Excluding Transaction-related and Restructuring-related Costs $1,950 - $2,350 $2,150 $2,050 - $2,350 $2,200 (1)     Non-GAAP financial measures. See “Non-GAAP Financial Measures” for additional information. (2)     2026 Financial Guidance reaffirmed on May 7, 2026, excluded any acquired IPR&D for unsigned deals to be incurred in any future period as it could not be reasonably forecasted. (3)     2026 Financial Guidance as provided on August 6, 2026, excludes any acquired IPR&D for unsigned deals to be incurred in any future period as it cannot be reasonably forecasted. Conference Call and Earnings Materials As previously announced, Viatris will host a conference call and live webcast, today at 8:30 a.m. ET, to review the Company’s second-quarter 2026 financial results. Investors and the general public are invited to listen to a live webcast of the call at investor.viatris.com or by calling 844.308.3344 or 412.317.1896 for international callers. The “Viatris Q2 2026 Earnings Presentation,” which will be referenced during the call, can be found at investor.viatris.com. A replay of the webcast also will be available on the website. About Viatris Viatris Inc. (Nasdaq: VTRS) is a global healthcare company whose mission is to empower people worldwide to live healthier at every stage of life. We meet the needs of patients around the world by acting decisively with ingenuity and resolve. Whether we’re developing new medicines, working to maintain a resilient supply of needed therapies, or pursuing bold innovation, we strive to deliver solutions that are effective at scale and built to endure. We’re purpose-built to make an impact with a broad portfolio that spans generics, value-added medicines, established brands and innovative medicines that address areas of significant unmet need. We are headquartered in the U.S., with global centers in Pittsburgh, Shanghai, China, and Hyderabad, India. Learn more at viatris.com and investor.viatris.com, and connect with us on LinkedIn, Instagram, YouTube and X. Non-GAAP Financial Measures This press release includes the presentation and discussion of certain financial information that differs from what is reported under accounting principles generally accepted in the United States ("U.S. GAAP"). These non-GAAP financial measures, including, but not limited to, adjusted gross profit, adjusted gross margins, adjusted net earnings, adjusted EPS, EBITDA, adjusted EBITDA, free cash flow, free cash flow excluding the impact of transaction-related and restructuring-related costs, adjusted R&D and as a % of total revenues, adjusted SG&A and as a % of total revenues, adjusted earnings from operations, adjusted interest expense, adjusted other income, net, adjusted effective tax rate, constant currency total revenues, constant currency net sales, constant currency adjusted EBITDA, constant currency adjusted EPS, notional debt, gross leverage ratio and long-term gross leverage ratio target, are presented in order to supplement investors' and other readers' understanding and assessment of the financial performance of Viatris Inc. ("Viatris" or the "Company"). Free cash flow refers to U.S. GAAP net cash provided by operating activities less capital expenditures. Management uses these measures internally for forecasting, budgeting, measuring its operating performance, and incentive-based awards. Primarily due to acquisitions, divestitures and other significant events which may impact comparability of our periodic operating results, Viatris believes that an evaluation of its ongoing operations (and comparisons of its current operations with historical and future operations) would be difficult if the disclosure of its financial 6 results was limited to financial measures prepared only in accordance with U.S. GAAP. We believe that non-GAAP financial measures are useful supplemental information for our investors and when considered together with our U.S. GAAP financial measures and the reconciliation to the most directly comparable U.S. GAAP financial measure, provide a more complete understanding of the factors and trends affecting our operations. The financial performance of the Company is measured by senior management, in part, using adjusted metrics included herein, along with other performance metrics. In addition, the Company believes that including EBITDA and supplemental adjustments applied in presenting adjusted EBITDA is appropriate to provide additional information to investors to demonstrate the Company's ability to comply with financial debt covenants and assess the Company's ability to incur additional indebtedness. The Company also believes that adjusted EBITDA better focuses management on the Company's underlying operational results and true business performance and is used, in part, for management's incentive compensation. We also report sales performance using the non-GAAP financial measures of "constant currency", also referred to herein as "operational change", total revenues, net sales, adjusted EBITDA, and adjusted EPS. These measures provide information on the change in total revenues, net sales, adjusted EBITDA, and adjusted EPS assuming that foreign currency exchange rates had not changed between the prior and current period. The comparisons presented at constant currency rates reflect comparative local currency sales at the prior year's foreign exchange rates. We routinely evaluate our net sales, total revenues, adjusted E