Arrowhead Pharmaceuticals 2025 Q2 Earnings Strong Turnaround with Net Income Swinging 389.7%

Arrowhead Pharmaceuticals (ARWR) reported its fiscal 2025 Q2 earnings on May 12th, 2025. The company experienced a significant turnaround with a net income of $367.86 million, a 389.7% positive swing from a net loss of $127 million in the previous year. The earnings per share (EPS) of $2.78 beat expectations, reversing a loss of $1.02 per share in 2024 Q2. Arrowhead anticipates launching plozasiran by November 18, 2025, pending regulatory approval, with an expected revenue of $90 to $125 million over the next 12 months.

Revenue

Arrowhead Pharmaceuticals' revenue for 2025 Q2 remained unchanged at $542.71 million, compared to no revenue in the previous year. The company's collaboration with Sarepta was the key contributor, generating $542.71 million, while the partnership with GSK added a modest $3,000.

Earnings/Net Income

Arrowhead Pharmaceuticals posted a remarkable turnaround in earnings, achieving an EPS of $2.78, up from a loss of $1.02 per share in the same quarter last year. The company's net income improved significantly, reaching $367.86 million, representing a 389.7% positive swing from a net loss of $127 million in 2024 Q2. This performance indicates a strong recovery and positive outlook.

Price Action

The stock price of Arrowhead Pharmaceuticals edged up by 0.72% during the latest trading day, experienced a slight decline of 0.07% over the most recent full trading week, and surged by 18.39% month-to-date.

Post-Earnings Price Action Review

The strategy of buying Arrowhead Pharmaceuticals stock (ARWR) after a revenue miss and holding for 30 days proved to be ineffective. The backtest revealed a significant loss of 61.20% with an excess return of -156.27% and a Sharpe ratio of -0.30, indicating high risk and negative returns. The maximum drawdown was -85.62%, further emphasizing the strategy's high risk and the critical need for effective risk management. These results highlight the importance of careful analysis and risk assessment before adopting similar investment strategies in the future, as the potential for substantial losses is evident.

CEO Commentary

Christopher Anzalone, President & CEO, expressed optimism about Arrowhead Pharmaceuticals' trajectory, stating, "We expect to make the transition from development stage to commercial stage with the planned launch of plozasiran this year." He highlighted the strength of the company's financial position and its ability to support ambitious development plans, noting that "the combination of commercial expansion" and "our extraordinarily productive discovery engine" positions Arrowhead favorably amidst a challenging biotech market. Anzalone emphasized the potential of plozasiran as a primary value driver and the robust pipeline of clinical assets that support long-term growth, indicating a confident outlook for the company's future.

Guidance

Arrowhead Pharmaceuticals anticipates launching plozasiran by November 18, 2025, pending regulatory approval. The company expects to be funded into 2028, with potential revenue of $90 to $125 million recognized over the next 12 months, primarily from a collaboration agreement with Sarepta. Additionally, there is potential for $300 million in near-term milestone payments associated with the ARO-DM1 program. Arrowhead's revenue for the quarter ended March 31, 2025, was reported at $542.7 million, with an EPS of $2.78.

Additional News

Arrowhead Pharmaceuticals recently closed a significant licensing and collaboration agreement with Sarepta Therapeutics, receiving $825 million, including $500 million in cash and $325 million as an equity investment. This agreement further strengthens Arrowhead's financial position, ensuring funding into 2028. Additionally, the company announced the retirement of its Chief Financial Officer, Ken Myszkowski, effective May 13, 2025, after 16 years of service. Daniel Apel has been appointed as the new CFO. Arrowhead is also amplifying patient voices with its new patient-centric resources for those affected by Familial Chylomicronemia Syndrome (FCS), demonstrating its commitment to the FCS community and ongoing engagement.