What explains ALGS' consistent earnings surprises?

Alicos Therapeutics Inc. (ALGS) has experienced a significant net loss of $82.15 million for the quarter ending December 31, 2024, with a corresponding total revenue of $629,000, and a diluted EPS of $-13.08. The company's financial performance has been marked by substantial fluctuations, with a reported net loss of $131.2 million for the year ended December 31, 2024, compared to $87.7 million in the previous year.

1. **Revenue Decline and Variance**: Aligos Therapeutics has faced a substantial decline in revenue, with a year-over-year growth rate of -76.54% and a revenue surprise of 195,667. This significant decrease is primarily attributed to the completion of the Original Agreement with Merck and the agreement with Amoytop, which have led to a decrease in revenue from collaborations and customers.

|code|Ticker|Name|Date|Revenue Surprise|EPS Surprise|market_code|
|---|---|---|---|---|---|---|
|ALGS|ALGS.O|Aligos|2024 Q1|9860000|0.17|186|
|ALGS|ALGS.O|Aligos|2024 Q2||0.19|186|
|ALGS|ALGS.O|Aligos|2024 Q3|939000|-0.91|186|
|ALGS|ALGS.O|Aligos|2024 Q4|195667|-10.58|186|

|code|Ticker|Name|Date|Net Income YoY|market_code|
|---|---|---|---|---|---|
|ALGS|ALGS.O|Aligos|2024 Q1|-51.8754084077543|186|
|ALGS|ALGS.O|Aligos|2024 Q2|126.93310627428025|186|
|ALGS|ALGS.O|Aligos|2024 Q3|-6.751288731223324|186|
|ALGS|ALGS.O|Aligos|2024 Q4|-194.52889717481716|186|

|code|Ticker|Name|Date|Total Revenue YoY|market_code|
|---|---|---|---|---|---|
|ALGS|ALGS.O|Aligos|2024 Q1|-63.78993756885788|186|
|ALGS|ALGS.O|Aligos|2024 Q2|-84.59192564623874|186|
|ALGS|ALGS.O|Aligos|2024 Q3|-60.82124112380364|186|
|ALGS|ALGS.O|Aligos|2024 Q4|-76.53860499813503|186|

|code|Ticker|Name|Date|Diluted EPS YoY|market_code|
|---|---|---|---|---|---|
|ALGS|ALGS.O|Aligos|2024 Q1|58.49056603773586|186|
|ALGS|ALGS.O|Aligos|2024 Q2|106.9767441860465|186|
|ALGS|ALGS.O|Aligos|2024 Q3|70.39537126325939|186|

|code|Ticker|Name|Date|Net Income YoY|Net Income|market_code|
|---|---|---|---|---|---|---|
|ALGS|ALGS.O|Aligos|2024 Q1|-51.8754084077543|-3.4863E7|186|
|ALGS|ALGS.O|Aligos|2024 Q2|126.93310627428025|5061000|186|
|ALGS|ALGS.O|Aligos|2024 Q3|-6.751288731223324|-1.9259E7|186|
|ALGS|ALGS.O|Aligos|2024 Q4|-194.52889717481716|-8.215E7|186|

|code|Ticker|Name|Date|Total Revenue YoY|Total Revenue|market_code|
|---|---|---|---|---|---|---|
|ALGS|ALGS.O|Aligos|2024 Q1|-63.78993756885788|986000|186|
|ALGS|ALGS.O|Aligos|2024 Q2|-84.59192564623874|1061000|186|
|ALGS|ALGS.O|Aligos|2024 Q3|-60.82124112380364|1269000|186|
|ALGS|ALGS.O|Aligos|2024 Q4|-76.53860499813503|629000|186|

|code|Ticker|Name|Date|Diluted EPS YoY|Diluted EPS|market_code|
|---|---|---|---|---|---|---|
|ALGS|ALGS.O|Aligos|2024 Q1|58.49056603773586|-0.22|186|
|ALGS|ALGS.O|Aligos|2024 Q2|106.9767441860465|0.03|186|
|ALGS|ALGS.O|Aligos|2024 Q3|70.39537126325939|-3.07|186|

2. **Increased Net Loss**: The net loss for the year ended December 31, 2024, was significantly higher than the previous year, primarily due to a $44 million increase in the change in fair value of common warrants. This increase in net loss, coupled with the decline in revenue, has contributed to the company's negative earnings surprise.
3. **Operational and Strategic Adjustments**: Aligos Therapeutics has made efforts to streamline its operations, reducing research and development expenses to $70.3 million from $73.0 million in 2023, and general and administrative expenses to $22.8 million from $30.6 million. These adjustments have been necessary to manage the company's financial performance amidst the challenges posed by its pipeline development and revenue generation.

In conclusion, Aligos Therapeutics' consistent earnings surprises can be attributed to a combination of factors, including a substantial decline in revenue, increased net loss due to changes in warrant valuation, and operational adjustments to manage expenses. These factors, coupled with the company's focus on pipeline development, have resulted in significant fluctuations in its financial performance.