Teva Pharmaceutical Industries Ltd. (NYSE: TEVA) released its third-quarter earnings reports before the markets opened on Tuesday. Despite underperforming this year, it has truly been a time of transition for this pharmaceutical giant. Even though earnings were in line, investors still sent shares lower.

The company posted $1.31 in earnings per share (EPS) and $5.56 billion in revenue, versus consensus estimates from Thomson Reuters that called for EPS of $1.28 and $5.73 billion in revenue. The same period of last year reportedly had $1.35 in EPS and revenue of $4.82 billion.

The generic medicines segment generated profit of $867 million in the third quarter of 2016, an increase of 50% compared year over year. Generic medicines profitability as a percentage of generic medicines revenues was 29.9% in the third quarter of 2016, up from 26.2%.

Also during this quarter, specialty medicines revenues totaled $2.0 billion, a decrease of 6% compared to last year. U.S. specialty medicines revenues were $1.6 billion, down 8%.

Cash flow from operations generated during the third quarter of 2016 was $1.5 billion, an increase of 34% compared to the third quarter of 2015. On the books, the cash and cash equivalents totaled $2.7 billion at the end of the quarter, down from $8.2 billion at the end of the June quarter this year.

In terms of fourth quarter guidance, the company expects EPS in the range of $1.34 to $1.44 and revenues between $6.2 billion and $6.5 billion. The consensus estimates are $1.42 in EPS and $6.48 billion in revenue.

Erez Vigodman, president and CEO of Teva, commented:

This has been a year of transition for Teva, underscored this quarter by the close of our strategic acquisition of Actavis Generics, which had significant contribution to our results. Actavis will continue to contribute in a meaningful way to the future growth of our generics business through the strengthened R&D capabilities and complementary pipeline and portfolio, and enhance our leadership in an increasingly evolving industry. We were also pleased to report this quarter that we have successfully completed the second pivotal phase three study for SD-809 for tardive dyskinesia and plan to submit that NDA to the U.S. FDA at the end of this year, and have also resubmitted SD-809 for Huntington disease in response to the FDA’s Complete Response Letter. Going forward, we will focus on also growing our specialty pipeline through in-house opportunities, including in the development and commercialization of our key pipeline assets, most notably our anti-CGRP product for migraine headaches and fasinumab. In the face of the industry and company-specific challenges we have been dealing with this year, we remain excited about the future as we strive to create a platform that is unique to the industry, working every day to find the delicate balance between access and innovation and laying the foundation for Teva’s continued growth.

Shares of Teva closed Monday at $41.03, with a consensus analyst price target of $63.00 and a 52-week trading range of $37.82 to $66.55. Following the release of the earnings report, the stock was down nearly 4% at $39.50 in early trading indications Tuesday.

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