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    VTRS
    Earnings call· Mar 2026(Q1 FY26)

    Viatris Q1 FY26 earnings call VTRS

    May 7, 2026 Source

    Executive summary

    Viatris Q1 FY26 — Strong Start Driven by China and Pipeline Progress

    Viatris delivered a strong Q1 FY26, exceeding expectations with robust revenue and EBITDA growth, primarily fueled by exceptional performance in Greater China and solid execution in North America. The company reaffirmed its full-year guidance, citing early-year strength and ongoing pipeline advancements, including key regulatory approvals and upcoming launches. Management emphasized disciplined capital allocation and cost optimization efforts, positioning the company for sustained long-term growth.

    Highlights

    5

    • Total revenues of $3.5 billion, up 3% year-over-year operationally.

    • Adjusted EBITDA of $1 billion, reflecting 10% growth.

    • Adjusted EPS of $0.59 per share.

    • Greater China revenue accelerated to 18% year-over-year growth, with e-commerce sales more than doubling.

    • North America net sales grew 3%, driven by increased demand for estradiol, Breyna, and new complex generic launches.

    Concerns

    3

    • Emerging Markets net sales were flat year-over-year, below expectations, due to supply constraints in the lower-margin ARV portfolio.

    • Europe net sales declined approximately 1% due to softer market conditions, competitive pressure on Dymista, and certain supply constraints.

    • JANZ net sales decreased approximately 2% due to anticipated increased competition in Australia and government price regulations in Japan.

    Guidance & targets

    8
    CategoryTargetConfidence
    Total Revenues
    Reaffirmed
    high materiality
    High
    Adjusted EBITDA
    Reaffirmed
    high materiality
    High
    Adjusted EPS
    Reaffirmed
    high materiality
    High
    Greater China Revenue Growth
    mid- to high-single digits
    medium materiality
    High
    FX Impact on Total Revenues
    1% tailwind
    low materiality
    Medium
    FX Impact on Adjusted EBITDA
    1% tailwind
    low materiality
    Medium
    Full Year Phasing (Revenue, EBITDA, EPS)
    52% weighted to second half
    medium materiality
    High
    Free Cash Flow Phasing
    Higher in the second half
    medium materiality
    High

    Segment performance

    6
    SegmentRevenueYoYQoQMargin
    Developed Markets
    Net sales increased by 1% versus the prior year, roughly in line with expectations.
    		—1%——
    North America
    Grew 3%, driven by increased demand for estradiol, continued strong performance from Breyna and new product revenue contributions from complex generic launches.
    Growth drivers: increased demand for estradiol, strong performance from Breyna, new product revenue from complex generic launches
    		—3%——
    Europe
    Net sales declined approximately 1% versus the prior year, mainly due to softer market conditions in select countries, anticipated competitive pressure on Dymista and certain supply constraints. Underlying fundamentals remain strong.
    Decline drivers: softer market conditions in select countries, anticipated competitive pressure on Dymista, certain supply constraintsUnderlying fundamentals: strong, driven by Creon, new product revenues, and growth in Italy
    		—-1%——
    Emerging Markets
    Net sales were flat year-over-year, below expectations, supported by continued strength in established brands but offset by supply constraints in the lower margin ARV portfolio.
    Performance drivers: continued strength in established brands across certain key marketsOffset by: supply constraints in lower margin ARV portfolio
    		—0%——
    JANZ
    Net sales decreased approximately 2% versus the prior year, but came in above expectations. Decline driven by anticipated increased competition in Australia and government price regulations in Japan, partially offset by solid performance from key brands.
    Decline drivers: anticipated increased competition in Australia, impact of government price regulations in JapanOffset by: solid performance from key brands including Creon and Amitiza
    		—-2%——
    Greater China
    Delivered a very strong quarter with growth accelerating ahead of expectations at 18% year-over-year, driven by favorable market fundamentals, strategic investments, and e-commerce growth.
    Growth drivers: favorable market fundamentals (aging population, increasing demand for cardiovascular products), cumulative impact of strategic selling and marketing investments, growth across all channelsE-commerce sales: more than doubled compared to prior year
    		—18%——

    Operational metrics

    12
    Total Revenues
    $3.5Bup 3% operational YoY
    Q1 FY26

    Reported total revenues for the quarter.

    Adjusted EBITDA
    $1Bup 10% YoY
    Q1 FY26

    Reported adjusted EBITDA for the quarter.

    Adjusted EPS
    $0.59
    Q1 FY26

    Reported adjusted EPS for the quarter.

    Adjusted Gross Margin
    56%flat YoY
    Q1 FY26

    Adjusted gross margin was flat versus the prior year, slightly better than expected.

    Cash Available for Deployment
    >$2.5B
    FY26

    Expected cash available for deployment during 2026, providing flexibility for capital allocation priorities.

    Capital Returned to Shareholders (Dividend)
    $140M
    Q1 FY26

    Amount of capital returned to shareholders through dividends during the quarter.

    Cost Savings Program
    $120M
    FY26

    Estimated cost savings from the enterprise-wide strategic review for the current year.

    New Product Revenue
    $71M
    Q1 FY26

    Contribution from new product launches, in line with expectations.

    Fast-acting Meloxicam Sales Force Size
    150-200
    Launch

    Planned size of the specialty sales force for the launch of fast-acting meloxicam.

    Women's Health Sales Force Size
    70
    Launch

    Planned maximum size of the sales force for women's health products, including XULANE LO.

    Selatogrel SOS-AMI Phase III Enrollment Rate
    1,200
    Current

    Current enrollment rate for the SOS-AMI Phase III study, on track for full enrollment by end of 2026.

    Long-term Organic Growth Goal
    4%
    by 2030

    Long-term goal for organic growth, with Q1 FY26 showing 3% growth as a strong start.

    Industry KPIs

    8
    MetricValueDetails
    EPS revenue guidanceReaffirmed
    Pricing policy impactGovernment price regulations
    Pipeline clinical milestones6product candidates
    Regulatory approvals filingsEFFEXORapproval
    Glp 1 incretin franchise metricsDeveloping generic GLP-1s
    Geographic regional revenue growth18%%
    Clinical trial efficacy safety dataPositive results
    Business development capacity deal appetite>$2.5BUSD

    Product announcements

    2
    ProductTypeDetails
    EFFEXORlaunch
    Generic to Abilify Maintenalaunch

    Risks & headwinds

    8
    Softer market conditions in select European countriesQ1 FY26

    Contributed to ~1% decline in Europe net sales

    Anticipated competitive pressure on DymistaQ1 FY26

    Contributed to ~1% decline in Europe net sales

    Certain supply constraints in EuropeQ1 FY26

    Contributed to ~1% decline in Europe net sales

    Supply constraints in lower margin ARV portfolioQ1 FY26

    Offset strength in established brands, leading to flat Emerging Markets net sales

    Mitigation: Mitigating by moving production to additional sources; team working to alleviate constraints.

    Anticipated increased competition in AustraliaQ1 FY26

    Contributed to ~2% decline in JANZ net sales

    Impact of government price regulations in JapanQ1 FY26

    Contributed to ~2% decline in JANZ net sales

    Policy risk in ChinaOngoing

    Dynamic and unpredictable

    Mitigation: Diversifying business from hospitals to retail and e-commerce channels.

    Additional competitive pressure across generics in developed marketsRemainder of FY26

    Expected to partially offset tailwinds from Greater China and Amitiza

    What to watch in Q2 FY26

    5

    Fast-acting meloxicam PDUFA date

    within the next couple of weeks
    CurrentNDA accepted, awaiting PDUFA date
    TargetConfirmation of PDUFA goal date

    Why it matters

    Confirmation of the PDUFA date is a critical step towards the anticipated U.S. launch of this product, which is expected to be an important growth driver.

    So we anticipate that the agency -- we're expecting that the agency will be giving us the PDUFA date and timing of📎 review within the next couple of weeks. So we should get much more visibility on that timing, and we will let you know.

    Q&A highlights

    7

    Given the strong 18% growth in Greater China, why was full-year guidance only reaffirmed, and what is the durability of this strength?

    Management noted it's early in the year but expressed confidence in the China market, attributing growth to strong execution, commercial investments (especially e-commerce), and favorable market fundamentals. They raised the FY26 China growth expectation to mid- to high-single digits but cited dynamic and unpredictable policy risks as a reason for not raising overall guidance yet.

    “Yes, it was a clean quarter, driven a lot by revenue in China and North America. You asked about China. I've been involved with business in China since the late '90s. I actually ran China operations for a prior company, and so I'm close to that market. It's the strongest China market over the last 12, 18 months that I've ever seen, both on the innovative side and on the total side.”

    asked by Glen Santangelo · answered by Scott Smith

    3 min read7 chapters

    Detailed Narrative

    01

    Q1 Performance & Strategic Imperatives

    Viatris reported a strong start to FY26, with total revenues up 3% operationally to $3.5 billion, adjusted EBITDA growing 10% to $1 billion, and adjusted EPS at $0.59. This performance validates the company's long-term growth strategy, which focuses on driving the base business, fueling the innovative portfolio, and modernizing for sustainable growth. The company expressed confidence in its full-year outlook based on current momentum.

    02

    Pipeline Progress & Upcoming Launches

    The company achieved regulatory approval for EFFEXOR for GAD in Japan, one of six anticipated product candidates for the year. Key upcoming U.S. launches include the weekly contraceptive patch XULANE LO (PDUFA July 30, 2026) and fast-acting meloxicam (regulatory decision by year-end). Other significant milestones include phentolamine ophthalmic solution sNDA (PDUFA October 17, 2026) and PMDA decisions for pitolisant in Japan for two indications in H2 2026. Phase III programs for selatogrel and cenerimod are on track, representing longer-term growth drivers.

    03

    Greater China & Japan Market Dynamics

    Greater China was a significant contributor, with revenue accelerating 18% year-over-year, driven by favorable market fundamentals, strategic selling and marketing investments, and e-commerce growth (sales more than doubled). In Japan, momentum is building with the EFFEXOR launch and several more launches expected. The company increased its FY26 growth expectation for Greater China to mid- to high-single digits, acknowledging potential policy risks but confident in current trends and channel diversification.

    04

    Capital Allocation & Business Development

    Viatris maintains a disciplined and balanced approach to capital allocation, intending to return capital to shareholders through dividends and share repurchases, while also investing in the business. Business development remains a key component, with a focus on in-market, accretive opportunities aligned with existing capabilities to strengthen growth durability. The company expects over $2.5 billion of cash available for deployment in 2026.

    05

    Cost Optimization & Operational Efficiency

    Progress is being made on opportunities identified through an enterprise-wide strategic review to optimize the cost structure, improve resource allocation, and drive operational efficiency. The company is on track to deliver anticipated cost savings, which contributed to favorable operating expenses in Q1, while also reinvesting to support future growth. This is expected to lead to continued operating leverage.

    06

    Selatogrel Trial Design & Progress

    The Phase III SOS-AMI study for selatogrel is enrolling approximately 1,200 patients per month, on track for full enrollment by end of 2026. The primary endpoint is a ranking endpoint designed in collaboration with the FDA, assessing the severity of MI on an ordinal scale from death to acute MI without significant impact, with the worst outcome for the patient taken into account. The study is powered to detect a relative risk reduction of about 20%.

    07

    GLP-1 Strategy & ARV Business

    Viatris intends to be a significant player in the GLP-1 space, developing generic versions of currently approved GLP-1s, with a hyper-focus on the U.S. market due to opportunities for differentiation, particularly around auto-injector devices. The ARV business experienced supply constraints in Q1, which impacted Emerging Markets sales. Management is actively mitigating these constraints by moving production to additional sources and expects to ramp up supply, with all associated risks baked into the reaffirmed full-year guidance.

    AI-generated summary of the company’s earnings call. Not investment advice.