2seventy bio 2025 Q1 Earnings Strong Performance as Net Income Swings 100.9%

2seventy bio Inc (TSVT, Financial) released its 8-K filing on May 7, 2025, detailing its financial results for the first quarter ended March 31, 2025. The company, a cell and gene therapy firm focused on cancer treatments, reported significant revenue growth and provided updates on its impending acquisition by Bristol Myers Squibb (BMS). 2seventy bio exceeded analyst expectations with Q1 2025 revenue of $22.9 million, surpassing the $13.96 million estimate. The company did not provide guidance adjustments due to the ongoing acquisition by BMS.

Revenue

2seventy bio experienced notable revenue growth in Q1 2025, reaching $22.94 million, a significant increase from $12.44 million in Q1 2024. This growth was driven by $3.77 million in service revenue, $19.14 million from collaborative arrangements, and $21,000 in royalty and other income.

Earnings/Net Income

The company returned to profitability in Q1 2025 with a net income of $482,000, marking a dramatic turnaround from the $52.67 million loss in Q1 2024. This success is reflected in an EPS of $0.01, a positive shift from the previous year's loss of $1.01 per share, indicating a strong recovery.

Price Action

The stock price of 2seventy bio edged up by 0.20% during the latest trading day, continued to rise 0.20% over the past week, and marked a 1.01% increase month-to-date.

Post-Earnings Price Action Review

The strategy of buying TSVT shares following a revenue increase and holding for 30 days resulted in a profit factor of 0.52 and an annualized ROI of -38.47% over the backtested period, indicating negative overall performance. This strategy, with an average holding time of about one week and a 50% winning trades percentage, still managed to outperform the buy-and-hold approach, yielding excess returns of 324.83%. However, the negative annualized return suggests that while some positive returns were generated, they were insufficient to balance out the overall losses over the five-year period.

CEO Commentary

"Over the past four years we have delivered on that mission, treating thousands of multiple myeloma patients with Abecma and developing an R&D pipeline of innovative treatments for liquid and solid tumors," said Chip Baird, Chief Executive Officer of 2seventy bio. The company reported $59 million in U.S. commercial revenue for Abecma in Q1 2025, demonstrating growth as it continues to focus on differentiating Abecma’s safety and efficacy profile. Baird expressed gratitude to the dedicated community surrounding 2seventy bio, emphasizing the commitment to delivering more time for patients amidst the ongoing acquisition by Bristol Myers Squibb.

Guidance

The company did not provide financial guidance for 2025 due to the announced acquisition by Bristol Myers Squibb. The tender offer for 2seventy bio's shares is expected to close in the second quarter of 2025, with the waiting period under the HSR Act having expired. Following the tender offer, BMS will acquire all remaining shares at the same price of $5.00 per share, and the company will no longer host earnings calls or provide forward-looking statements.

Additional News

In a significant development, 2seventy bio entered into a definitive merger agreement with Bristol Myers Squibb (BMS) to be acquired at $5.00 per share in an all-cash transaction, which is expected to close in the second quarter of 2025. The merger is subject to customary closing conditions, including the tender of a majority of 2seventy bio’s shares. Following the successful completion, 2seventy bio’s common stock will no longer be listed on Nasdaq. Additionally, certain stockholders representing 6.0% of outstanding shares have entered into tender and support agreements. In light of the acquisition, 2seventy bio will not host an earnings conference call or provide financial guidance for the year.