Viatris : VTRS Q1 2026 Non-GAAP Reconciliations - FINAL

Published: 2026-05-07 07:35:22 ET VTRS

Published on 05/07/2026 at 07:35 am EDT

‌GAAP / Non-GAAP

Reconciliations

May 7, 2026

‌Key References and Non-GAAP Measures

New product sales, new product launches or new product revenues: Refers to third-party net sales from new products launched in a calendar year and the carryover impact of new products, including business development, launched within the previous 12 months.

Operational change: Refers to constant currency percentage changes and is derived by translating amounts for the current period at prior year comparative period exchange rates and in doing so shows the percentage change from current period constant currency net sales, total revenues, adjusted EBITDA, and adjusted EPS to the corresponding amount in the prior year.

Transaction costs or transaction-related costs: Refers to the impact of any acquisition and divestiture-related transaction costs, including taxes.

Restructuring costs or restructuring-related costs: Refers to the impact of any cash costs associated with the restructuring activities of the enterprise-wide strategic review, which are expected to be primarily related to severance and employee benefits expense, as well as other costs, including those related to contract terminations, vendor consolidations, product transfer costs and network related simplification and modernization costs.

Revenue and Earnings: Refers to Total Revenues, Adjusted EBITDA and Adjusted EPS.

Non-GAAP Financial Measures

This presentation 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 EBITDA, free cash flow, free cash flow excluding transaction-related and restructuring-related costs, adjusted EPS, adjusted gross margin, adjusted gross profit, adjusted SG&A and as a percentage of total revenues, adjusted R&D and as a percentage of total revenues, adjusted net earnings, adjusted effective tax rate, adjusted earnings from operations, adjusted interest expense, adjusted other income, net, constant currency total revenues, constant currency net sales, 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. Free cash flow refers to U.S. GAAP net cash provided by operating activities less capital expenditures. Free cash flow excluding transaction-related costs or restructuring-related costs refers to free cash flow, further adjusted to exclude transaction-related or restructuring-related costs, as applicable. Adjusted EBITDA refers to as U.S. GAAP net earnings (loss) adjusted for income tax provision (benefit), interest expense and depreciation and amortization (to calculate EBITDA) and further adjusted for share-based compensation expense, litigation settlements and other contingencies, net, loss on divestitures of businesses, impairment of goodwill and restructuring, acquisition and divestiture related and other special items. Adjusted EBITDA margins refers to adjusted EBITDA divided by total revenues. Adjusted EPS refers to adjusted net earnings divided by the weighted average number of diluted shares of common stock outstanding. Notional gross debt is the sum of the Company's long-term debt, including current portion, and short-term borrowings and other current obligations, adjusted for net premiums or discounts on various debt issuances and deferred financing fees. Viatris has provided reconciliations of such non-GAAP financial measures to the most directly comparable U.S. GAAP financial measures. Investors and other readers are encouraged to review the related U.S. GAAP financial measures and the reconciliations of the non-GAAP measures to their most directly comparable U.S. GAAP measures set forth in this presentation or on our website at https://investor.viatris.com/financial-information/non-gaap-reconciliations, and investors and other readers should consider non-GAAP measures only as supplements to, not as substitutes for or as superior measures to, the measures of financial performance prepared in accordance with U.S. GAAP.

2026 Guidance

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, including for the fair value accounting impact for equity investments, 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. 2026 financial guidance as initially provided on February 26, 2026 and reaffirmed on May 7, 2026 excludes the impact any acquired IPR&D for unsigned deals to be incurred in any future period as it cannot be reasonably forecasted.

Long-Term Financial Targets

The Company is not providing forward-looking information for U.S. GAAP net earnings (loss), or EPS or a quantitative reconciliation of its long-term target adjusted EBITDA, adjusted EPS and free cash flow targets or expectations to their most directly comparable U.S. GAAP measures, U.S. GAAP net earnings (loss), EPS and U.S. GAAP net cash provided by operating activities, 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, including for the fair value accounting impact for equity investments, 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 relevant periods.

Key Exchange Rates

Our 2026 financial guidance and long-term financial targets are based on the following budgeted exchange rates: Euro ($/EUR) 0.87, China Renminbi ($/CNY) 7.19, Japanese Yen ($/JPY) 144.35, and Indian Rupee ($/INR) 85.80.

‌Viatris Inc. and Subsidiaries | Reconciliation of Non-GAAP Financial Measures (Unaudited; in millions, except Adjusted EPS)

Full Year 2026 Financial Guidance Items as of May 7, 2026

GAAP

Non-GAAP (1)

Total Revenues

$14,450 - $14,950

N/A

Adjusted EBITDA

N/A

$4,150 - $4,450

Net Cash Provided by Operating Activities

$1,700 - $2,000

N/A

Free Cash Flow

Ex Transaction and Restructuring Costs

N/A

$1,950 - $2,350

Adjusted EPS

N/A

$2.33 - $2.47

For key references and non-GAAP measures, see slide 2

(1) 2026 financial guidance and key metrics as initially provided on February 26, 2026 and reaffirmed on May 7, 2026 exclude the estimated impact of transaction-related and restructuring-related costs of ~$700M. Also exclude any acquired IPR&D for unsigned deals to be incurred in any future period as it cannot be reasonably forecasted.

‌Viatris Inc. and Subsidiaries | Reconciliation of Non-GAAP Financial Measures (Unaudited; in millions)

Reconciliation of Estimated 2026 U.S. GAAP Net Cash Provided by Operating Activities to Free Cash Flow as of May 7, 2026

Estimated U.S. GAAP Net Cash Provided by Operating Activities

$1,700 - $2,000

Less: Capital Expenditures

($350) - ($450)

Free Cash Flow

$1,250 - $1,650

Add: Estimated Transaction and Restructuring Costs

~$700

Free Cash Flow Excluding Transaction and Restructuring Costs

$1,950 - $2,350

‌Viatris Inc. and Subsidiaries | Reconciliation of Non-GAAP Financial Measures (Unaudited; in millions, except Adjusted EPS)

Full Year 2026 Financial Guidance Items as of February 26, 2026

GAAP

Non-GAAP (1)

Total Revenues

$14,450 - $14,950

N/A

Adjusted EBITDA

N/A

$4,150 - $4,450

Net Cash Provided by Operating Activities

$1,700 - $2,000

N/A

Free Cash Flow

Ex Transaction and Restructuring Costs

N/A

$1,950 - $2,350

Adjusted EPS

N/A

$2.33 - $2.47

For key references and non-GAAP measures, see slide 2

(1) 2026 financial guidance and key metrics as provided as of February 26, 2026, excluded the estimated impact of transaction-related and restructuring-related costs of ~$700M. Also excluded any acquired IPR&D for unsigned deals to be incurred in any future period as it could not be reasonably forecasted.

‌Viatris Inc. and Subsidiaries | Reconciliation of Non-GAAP Financial Measures (Unaudited; in millions)

Reconciliation of Estimated 2026 U.S. GAAP Net Cash Provided by Operating Activities to Free Cash Flow as of February 26, 2026

Estimated U.S. GAAP Net Cash Provided by Operating Activities

$1,700 - $2,000

Less: Capital Expenditures

($350) - ($450)

Free Cash Flow

$1,250 - $1,650

Add: Estimated Transaction and Restructuring Costs

~$700

Free Cash Flow Excluding Transaction and Restructuring Costs

$1,950 - $2,350

‌Viatris Inc. and Subsidiaries | Reconciliation of Non-GAAP Financial Measures (Unaudited; in millions, except per share amounts)

Three Months Ended

March 31,

2026 2025

U.S. GAAP Net Earnings (Loss) to Adjusted Net Earnings and U.S. GAAP Diluted Earnings (Loss) Per Share to Adjusted EPS

U.S. GAAP net earnings (loss) and U.S. GAAP diluted earnings (loss) per share..............................

$ 176.4

$ 0.15

$ (3,042.0) $

(2.55)

Purchase accounting amortization (primarily included in cost of sales) .........................................

591.5

583.5

Impairment of goodwill ...............................................................................................................

2,936.8

Litigation settlements and other contingencies, net.....................................................................

53.5

(73.5)

Interest expense (primarily amortization of premiums and discounts on long term debt)............

(10.1)

(9.2)

Loss on divestitures of businesses (included in other expense, net) ............................................

13.9

36.9

Acquisition and divestiture-related costs (primarily included in cost of sales and SG&A) (a)...........

62.3

40.7

Restructuring costs (b).................................................................................................................

92.5

92.9

Share-based compensation expense............................................................................................

Other special items included in:

48.2

55.2

Cost of sales (c).........................................................................................................................

142.4

41.6

Research and development expense........................................................................................

2.8

0.7

Selling, general and administrative expense..............................................................................

35.4

17.6

Other expense, net (d)..............................................................................................................

61.3

101.4

Tax effect of the above items and other income tax related items (e)..........................................

(576.0)

(182.3)

Adjusted net earnings and adjusted EPS....................................................................................... $ 694.1 $

0.59

$ 600.3 $

0.50

Weighted average diluted shares outstanding.............................................................................. 1,175.3

1,203.0

Acquisition and divestiture-related costs consist primarily of contractual obligations related to divestitures, transaction costs including legal and consulting fees and integration activities.

For the three months ended March 31, 2026, charges include approximately $49.8 million in cost of sales, approximately $0.6 million in R&D, and approximately $42.0 million in SG&A, primarily relating to the 2026 restructuring program.

For the three months ended March 31, 2026, includes certain asset impairments, contractual termination costs, and incremental manufacturing variances and certain remediation costs at plants slated for sale or closure or undergoing remediation activities of approximately $130.7 million, including $71.9 million related to the write off inventory and fixed assets damaged in the fire at the Nashik manufacturing facility and incremental manufacturing variances.

For the three months ended March 31, 2026, charges include a loss of approximately $64.9 million as a result of changes in the fair value of the Biocon equity shares.

Adjusted for changes for uncertain tax positions.

‌Viatris Inc. and Subsidiaries | Reconciliation of Non-GAAP Financial Measures (Unaudited; in millions)

Restructuring, acquisition and divestiture-related and other special items (c)....... 385.0 284.9

Adjusted EBITDA................................................................................................................ $ 1,049.5 $ 923.5

Three Months Ended

March 31,

2026 2025

U.S. GAAP Net Earnings (Loss) to EBITDA and Adjusted EBITDA

U.S. GAAP net earnings (loss)...........................................................................................

$ 176.4

$ (3,042.0)

Add / (deduct) adjustments:

Income tax benefit.........................................................................................................

(423.7)

(55.0)

Interest expense (a).......................................................................................................

120.1

115.5

Depreciation and amortization (b)............................................................................... 676.1 664.7

EBITDA................................................................................................................................

$ 548.9

$ (2,316.8)

Add / (deduct) adjustments:

Share-based compensation expense

48.2

55.2

Litigation settlements and other contingencies, net..................................................

53.5

(73.5)

Loss on divestitures of businesses..............................................................................

13.9

36.9

Impairment of goodwill................................................................................................

2,936.8

Includes amortization of premiums and discounts on long-term debt.

Includes purchase accounting related amortization.

See items detailed in the Reconciliation of U.S. GAAP Net Earnings (Loss) to Adjusted Net Earnings.

‌Viatris Inc. and Subsidiaries | Reconciliation of Non-GAAP Financial Measures (Unaudited; in millions, except %s)

Net sales

Constant Currency %

Change (b)

2026 Constant

2026 Currency Currency Impact (a) Revenues

% Change

2025

2026

Three Months Ended

March 31,

Summary of Total Revenues by Segment - Q1 2026

Developed Markets ........................

$ 2,020.8

$ 1,891.7

7 %

$ (117.7) $

1,903.1

1 %

Greater China.................................

680.1

555.5

22 %

(25.6)

654.5

18 %

JANZ...............................................

273.4

276.1

(1)%

(3.9)

269.5

(2)%

Emerging Markets .......................... 535.4 519.9

3 %

(14.6) 520.8

- %

Total net sales........................ $ 3,509.7 $ 3,243.2

8 %

$ (161.8) $ 3,347.9

3 %

Other revenues (c).......................... 7.3 11.1

(0.2) 7.1

Consolidated total revenues (d).......... $ 3,517.0 $ 3,254.3

8 %

$ (162.0) $ 3,355.0

3 %

Currency impact is shown as unfavorable (favorable).

The constant currency percentage change is derived by translating net sales or revenues for the current period at prior year comparative period exchange rates, and in doing so shows the percentage change from 2026 constant currency net sales or revenues to the corresponding amount in the prior year.

For the three months ended March 31, 2026, other revenues in Developed Markets, JANZ, and Emerging Markets were approximately $5.2 million, $0.1 million, and $2.0 million, respectively.

Amounts exclude intersegment revenue which eliminates on a consolidated basis.

‌Viatris Inc. and Subsidiaries | Reconciliation of Non-GAAP Financial Measures (Unaudited; in millions)

Key Product Net Sales, on a Consolidated Basis

Lipitor ®

$ 462.0

$ 388.0

Norvasc ®

210.0

172.3

Lyrica ®

120.6

112.6

EpiPen ® Auto-Injectors

101.1

96.7

Creon ®

97.4

82.4

Viagra ®

95.0

98.5

Zoloft ®

72.6

60.2

Celebrex ®

67.1

63.4

Effexor ®

62.0

59.3

Xalabrands

39.2

37.1

Yupelri ®

$ 62.5

$ 58.3

Dymista ®

37.3

42.8

Xanax ®

34.8

32.3

Amitiza ®

34.0

33.3

The Company does not disclose net sales for any products considered competitively sensitive.

Select Key Segment Products

Select Key Global Products

Three Months Ended

March 31,

2026 2025

Products disclosed may change in future periods, including as a result of seasonality, competition or new product launches.

Amounts include the impact of foreign currency fluctuations compared to the prior year period.

‌Viatris Inc. and Subsidiaries | Reconciliation of Non-GAAP Financial Measures (Unaudited; in millions, except %s)

Cost of Sales

Three Months Ended

U.S. GAAP cost of sales $

Deduct:

2,359.8 $

2,093.1

Purchase accounting amortization and other related items......... (591.5) (583.5) Acquisition and divestiture-related costs........................................ (28.4) (12.2)

Restructuring costs............................................................................ (49.8) (19.8)

Share-based compensation expense.............................................. (1.0) (1.3) Other special items, including restructuring related costs........... (142.4) (41.6) Adjusted cost of sales........................................................................... $ 1,546.7 $ 1,434.7

Adjusted gross profit (a)....................................................................... $ 1,970.3 $ 1,819.6

Adjusted gross margin (a)..................................................................... 56% 56%

U.S. GAAP gross profit is calculated as total revenues less U.S. GAAP cost of sales. U.S. GAAP gross margin is calculated as U.S. GAAP gross profit divided by total revenues. Adjusted gross profit is calculated as total revenues less adjusted cost of sales. Adjusted gross margin is calculated as adjusted gross profit divided by total revenues.

‌Viatris Inc. and Subsidiaries | Reconciliation of Non-GAAP Financial Measures (Unaudited; in millions, except %s)

Adjusted SG&A as % of total revenues................................................ 22% 24%

Other special items and reclassifications....................................... (35.4) (17.6)

Adjusted SG&A...................................................................................... $ 774.9 $ 778.7

Three Months Ended

SG&A

U.S. GAAP SG&A ...................................................................................

$ 928.8

$ 948.1

Deduct:

Acquisition and divestiture-related costs........................................

(32.0)

(27.8)

Restructuring costs............................................................................

(42.0)

(72.3)

Share-based compensation expense..............................................

(44.5)

(51.7)

‌Viatris Inc. and Subsidiaries | Reconciliation of Non-GAAP Financial Measures (Unaudited; in millions, except %s)

Adjusted R&D as % of total revenues.................................................. 7% 7%

Other special items........................................................................... (2.8) (0.7)

Adjusted R&D........................................................................................ $ 240.5 $ 217.5

Three Months Ended

R&D

U.S. GAAP R&D......................................................................................

$ 248.6

$ 222.0

Deduct:

Acquisition and divestiture-related costs........................................

(2.0)

(0.7)

Restructuring costs............................................................................

(0.6)

(0.8)

Share-based compensation expense..............................................

(2.7)

(2.3)

‌Viatris Inc. and Subsidiaries | Reconciliation of Non-GAAP Financial Measures (Unaudited; in millions)

Adjusted earnings from operations (a)............................................... $ 948.9 $ 813.4

Impairment of goodwill adjustments.............................................. - (2,936.8)

Adjusted total operating expenses...................................................... $ 1,021.4 $ 1,006.2

Three Months Ended

Total Operating Expenses

U.S. GAAP total operating expenses....................................................

$ 1,236.9

$ 4,043.4

Add / (Deduct):

Litigation settlements and other contingencies, net......................

(53.5)

73.5

R&D adjustments..............................................................................

(8.1)

(4.5)

SG&A adjustments ...........................................................................

(153.9)

(169.4)

(a) U.S. GAAP earnings from operations is calculated as U.S. GAAP gross profit less U.S. GAAP total operating expenses. Adjusted earnings from operations is calculated as adjusted gross profit less adjusted total operating expenses.

‌Viatris Inc. and Subsidiaries | Reconciliation of Non-GAAP Financial Measures (Unaudited; in millions)

Interest Expense

Three Months Ended

U.S. GAAP interest expense $

Add / (Deduct):

Accretion of contingent consideration liability............................... Amortization of premiums and discounts on long-term debt......

120.1 $

115.5

(0.9)

11.8

(1.2)

11.0

Other special items........................................................................... (0.7) (0.6)

Adjusted interest expense.................................................................... $ 130.3 $ 124.7

‌Viatris Inc. and Subsidiaries | Reconciliation of Non-GAAP Financial Measures (Unaudited; in millions)

Other Expense, Net

Three Months Ended

U.S. GAAP other expense, net $

Add / (Deduct):

Fair value adjustments on non-marketable equity investments.. Fair value adjustments on marketable equity investments.......... Loss on divestitures of businesses..................................................

47.5 $

99.3

(64.9)

(13.9)

(115.8)

(36.9)

Other items........................................................................................ 3.7 14.4

Adjusted other income, net.................................................................. $ (27.6) $ (39.0)

‌Viatris Inc. and Subsidiaries | Reconciliation of Non-GAAP Financial Measures (Unaudited; in millions, except %s)

Loss Before Income Taxes and Income Tax Benefit

Three Months Ended

U.S. GAAP loss before income taxes $

(247.3) $

(3,097.0)

Total pre-tax non-GAAP adjustments.................................................. 1,093.7 3,824.7

Adjusted earnings before income taxes............................................. $ 846.4 $ 727.7

U.S. GAAP income tax benefit $

(423.7) $

(55.0)

Adjusted tax expense............................................................................ 576.0 182.3

Adjusted income tax provision............................................................ $ 152.3 $ 127.3

Adjusted effective tax rate.................................................................... 18.0% 17.5%

‌Viatris Inc. and Subsidiaries | Reconciliation of Non-GAAP Financial Measures (Unaudited; in millions)

Free Cash Flow and Free Cash Flow Excluding Transaction-related and Restructuring-related Costs

Three Months Ended

March 31,

U.S. GAAP net cash provided by operating activities $

Capital expenditures...................................................................................................

Free cash flow $

2026

388.3 $

(39.9)

348.4 $

2025

535.5

(42.6)

492.9

Transaction-related and restructuring-related costs................................................

Free cash flow excluding transaction-related and restructuring-related costs $

111.1

459.5 $

42.5

535.4

‌Viatris Inc. and Subsidiaries | Reconciliation of Non-GAAP Financial Measures (Unaudited; in millions, except ratio)

Gross Leverage - Debt to Adjusted EBITDA - Q1 2026

Gross Leverage Ratio is the ratio of Viatris' total debt at notional amounts at March 31, 2026 to the sum of Viatris' adjusted EBITDA for the quarters ended June 30, 2025,

September 30, 2025, December 31, 2025, and March 31, 2026.

Adjusted EBITDA $

1,078.8 $

1,154.6 $

1,003.1 $

1,049.5 $

4,286.0

Reported debt balances:

Long-term debt, including current portion......................... 14,341.1

Short-term borrowings and other current obligations...... -

Total............................................................................................

Add / (deduct):

$ 14,341.1

Net premiums on various debt issuances........................... (437.6)

Deferred financing fees......................................................... 20.2

Total debt at notional amounts................................................ $ 13,923.7

Gross debt to adjusted EBITDA x

The stated forward-looking non-GAAP financial measure of long-term gross leverage target of ~3.0x, with a range of 2.8x - 3.2x, is based on the ratio of (i) targeted notional gross debt and (ii) targeted adjusted EBITDA. However, the Company has not quantified future amounts to develop this target but has stated its goal to manage notional gross debt and adjusted EBITDA over time in order to generally maintain or reach the target. This target does not reflect Company guidance.

‌Viatris Inc. and Subsidiaries | Reconciliation of Non-GAAP Financial Measures (Unaudited; in millions)

Three Months Ended June 30, 2025 September 30, 2025 December 31, 2025 March 31, 2026

Net (Loss) Earnings to EBITDA and Adjusted EBITDA - Last Twelve Months

U.S. GAAP net (loss) earnings.....................................................................................

Add / (deduct) adjustments:

Income tax (benefit) provision................................................................................

$ (4.6)

(212.5)

(128.2)

120.3

(340.1)

(2.9)

$ 176.4

(423.7)

Interest expense (a)..................................................................................................

116.6

119.6

120.1

Depreciation and amortization (b).........................................................................

678.3

688.5

766.8

676.1

EBITDA..........................................................................................................................

Add / (deduct) adjustments:

Share-based compensation expense.....................................................................

$ 577.8

37.1

800.2

36.0

543.4

49.4

$ 548.9

48.2

Litigation settlements and other contingencies, net............................................

(47.6)

55.7

(3.1)

53.5

Loss (gain) on divestitures of businesses..............................................................

43.8

(1.6)

21.9

13.9

Restructuring, acquisition and divestiture-related and other special items......

467.7

264.3

391.5

385.0

Adjusted EBITDA..........................................................................................................

$ 1,078.8

1,154.6

1,003.1

$ 1,049.5

Includes amortization of premiums and discounts on long-term debt.

Includes purchase accounting related amortization.

Disclaimer

Viatris Inc. published this content on May 07, 2026, and is solely responsible for the information contained herein. Distributed via Public Technologies (PUBT), unedited and unaltered, on May 07, 2026 at 11:32 UTC.