Teva to cut 3,000 jobs by 2027 in drive toward higher profit margins
Pharma giant targets 30% operating margin by laying off approximately 8% of its global workforce as it boosts forecasts on drug sales and updates its "Pivot to Growth" strategy.
Teva Pharmaceutical announced it will lay off nearly 3,000 employees—approximately 8% of its global workforce—by 2027, as part of its effort to reach an operating profit margin of 30%.
The company reported first-quarter 2025 revenues of $3.89 billion on Wednesday, slightly below analysts’ forecasts of $4 billion. However, net profit—excluding one-time and non-cash items—reached 52 cents per share, outperforming expectations of 48 cents. The revenue figure reflects a modest year-over-year growth rate of 5%.
Teva’s flagship drug Austedo delivered stronger-than-expected results, prompting the company to raise its annual forecast for the treatment to $1.95–$2.05 billion. Sales of the drug, which treats involuntary movements associated with neurological disorders, rose 39% in the quarter. Meanwhile, revenue from Ajovy, its migraine treatment, increased by 26%, with Teva reaffirming its forecast of $600 million in 2025 for the drug.
Teva also raised its full-year revenue guidance by $200 million, now expecting total 2025 revenue of $16.8–$17.2 billion. This figure excludes revenues from its divested Japanese operations but still includes its Active Pharmaceutical Ingredients (API) division, which the company plans to sell. The updated forecast also excludes potential future payments from Sanofi, which depend on progress in clinical trials of duvakitug, a drug candidate for Crohn's disease.
Operating profit guidance has also been increased by $200 million, now projected at $4.3–$4.6 billion for 2025.
Despite a 15% stock surge since early April—driven by improving financials and strategic momentum—Teva shares remain down 27% year-to-date, following a disappointing profitability forecast issued at the start of the year.
Teva stated that it does not currently anticipate any significant impact from emerging U.S. tariff policies under President Trump.
Richard Francis, Teva's President and CEO, said, “Teva had a solid start to the year, with its ninth consecutive quarter of revenue growth, delivering global revenues of $3.9 billion, an increase of 5% in local currency terms compared to the first quarter of 2024. Our key innovative growth drivers continue to show strong momentum, collectively generating revenues of $589 million while each growing more than 25% year over year. We also achieved solid generics performance across all regions with biosimilars rounding out the portfolio.”
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Francis continued, “Now entering the Acceleration Phase of our Pivot to Growth Strategy, we have a clear roadmap to continue Teva's transformation into a leading biopharmaceutical company with an expected 30% operating margin and today have announced ~$700 million net savings by 2027. We’re accelerating innovative growth and strengthening our generics business, while streamlining our operations, sharpening our business and optimizing processes. With these results, we are revising our 2025 outlook and reaffirming our 2027 targets.”
Regarding the layoffs, the company said: “As part of Teva's new strategy focused on innovation and renewed growth, we are accelerating the implementation of organizational changes across our global operations. This includes simplifying workflows, eliminating redundancies, and reallocating resources to support our new growth drivers. These changes will also enable increased investment in R&D and strategic initiatives—including our global innovation program, which will be managed and operated out of Israel.”
