Adverum 2024 Q3 Earnings Misses Expectations as Net Loss Narrows 1.6%

Adverum Biotechnologies (ADVM) reported a wider-than-expected loss of $2.03 per share in Q3 2024, undershooting the $1.80 average analyst estimate. Despite a 1.6% reduction in net losses year-over-year, the company’s stock fell sharply, trading at $4.30 on the day, a 45% decline from its $7.89 level a year ago.

Revenue

Adverum’s total revenue held steady at $1 million in Q3 2024, unchanged from the prior year. License revenue accounted for the entirety of the company’s earnings, with no additional revenue streams reported.

Earnings/Net Income

The company posted a loss of $2.03 per share, significantly widening its quarterly deficit compared to $0.33 in 2023. While the net loss narrowed to $32.35 million (down from $32.88 million), the EPS decline underscores persistent operational challenges. The EPS of -$2.03 reflects a deteriorating financial position despite marginal cost reductions.

Price Action

ADVM shares fell sharply post-earnings, closing at $4.30, a 45% drop from November 2024 levels. The stock’s 3.37% monthly gain contrasted with its 30-day underperformance against broader markets.

Post-Earnings Price Action Review

The strategy of purchasing ADVM shares on earnings dates and holding for 30 days yielded moderate returns but underperformed the market. Over three years, the 2.5% annualized return lagged the S&P 500’s 8.6%, suggesting limited alignment with market trends. While the approach captured some growth, it missed significant gains, highlighting ADVM’s struggle to gain traction with investors.

CEO Commentary

In a statement, Adverum’s CEO acknowledged the narrowing net loss as a “positive step” but emphasized ongoing challenges. “We remain focused on advancing our gene therapy pipeline, particularly for wet AMD, where our Phase 3 ARTEMIS trial is progressing ahead of schedule,” the CEO noted. Leadership reiterated confidence in long-term growth drivers but cautioned that profitability remains distant.

Guidance

The company provided no specific guidance for Q4 2024 or 2025 but highlighted expectations for topline data from the ARTEMIS trial in Q1 2027. Management emphasized cost discipline and partnerships to fund research, though no concrete targets were outlined.

Additional News

Adverum’s ARTEMIS trial for wet AMD advanced ahead of schedule, with topline data now expected in Q1 2027. A $10 million private placement with Frazier Life Sciences bolstered research efforts, including 2-year follow-up data for the LUNA study. Analysts remain divided, with Chardan Capital setting a $2 price target versus the $4.83 consensus, reflecting uncertainty over near-term profitability.

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