Why did RLYB's Q4 earnings fall short of forecasts?

Rallybio's Q4 earnings fell short of forecasts due to a significant decline in its net income, which was reported at -$11.04 million, compared to the latest report period's end date of December 31, 2024. This substantial loss, coupled with an EPS surprise of 0.55, indicates that the company's performance was notably below market expectations. |code|Ticker|Name|Date|Net Income|market_code| |---|---|---|---|---|---| |RLYB|RLYB.O|Rallybio|2024 Q1|-1.9029E7|185| |RLYB|RLYB.O|Rallybio|2024 Q2|-1.6236E7|185| |RLYB|RLYB.O|Rallybio|2024 Q3|-1.1466E7|185| |RLYB|RLYB.O|Rallybio|2024 Q4|-1.1044E7|185| The reasons for Rallybio's disappointing earnings can be analyzed from several perspectives: 1. **Program Discontinuation**: Rallybio's decision to halt its RLYB212 program, which was being developed to address fetal and neonatal alloimmune thrombocytopenia, has had a significant impact on the company's developmental pipeline and market perspectives. This program's discontinuation represents a strategic shift that likely affected financial outcomes, leading to a negative net income. 2. **Market and Analyst Reaction**: Evercore ISI downgraded Rallybio from Outperform to In Line, reflecting a more cautious outlook on the stock following the program discontinuation. This downgrade, along with the withdrawal of the previous price target, suggests that the market may have had concerns about Rallybio's future prospects, contributing to the negative sentiment around the earnings report. In summary, Rallybio's Q4 earnings fell short of forecasts due to a combination of program discontinuation and market reaction, leading to a substantial decline in net income and an EPS surprise.