Avalo Therapeutics 2025 Q3 Earnings Net Loss Widens 232.9%

The biotech firm missed estimates with a net loss of $2.19 per share, sharply below the $1.66 expected by analysts, while cash reserves are projected to fund operations through 2028.

Revenue

Avalo Therapeutics reported zero revenue in Q3 2025, a 100% decline from $249,000 in the prior-year period, due to the expiration of its Millipred® license and supply agreement.

Earnings/Net Income

The company swung to a loss of $2.19 per share in Q3 2025 from a profit of $0.98 per share a year earlier, reflecting a 232.9% deterioration in net income. The $30.63 million net loss marked a stark reversal from $23.04 million in profits in 2024 Q3. This outcome underscores persistent financial challenges, with losses extending over eight consecutive years in the same quarter. The deteriorating performance highlights the company’s reliance on clinical development costs and operational inefficiencies.

Price Action

Avalo’s stock edged down 2.53% during the latest trading day, though it gained 14.39% month-to-date. However, the shares tumbled 14.50% over the past week, reflecting mixed investor sentiment post-earnings.

Post-Earnings Price Action Review

Despite a sharp post-earnings dip, the stock has shown resilience, climbing 14.39% month-to-date. The mixed price action reflects investor uncertainty over the company’s near-term prospects amid significant losses and a lack of immediate revenue drivers. However, the stock’s month-to-date gain suggests some optimism about the pipeline, particularly the Phase 2 LOTUS trial for AVTX-009. Analysts remain divided, with a “buy” consensus rating but no recent revisions to earnings estimates.

CEO Commentary

Dr. Garry Neil emphasized progress in the Phase 2 LOTUS trial for AVTX-009, with topline data expected mid-2026. He highlighted the drug’s potential to address hidradenitis suppurativa and confidence in its high-affinity IL-1β inhibition. Strategic priorities include advancing clinical trials, leveraging $111.6 million in cash reserves, and expanding leadership in business development and HR.

Guidance

The company expects its $111.6 million in cash and short-term investments to fund operations through 2028. R&D expenses are anticipated to rise due to Phase 2 trial costs, while G&A expenses remain elevated from stock-based compensation. Topline data from the LOTUS trial will inform Phase 3 planning, with leadership appointments and operational milestones aligned to support AVTX-009’s development.

Additional News

Avalo Therapeutics recently completed enrollment in its Phase 2 LOTUS trial for AVTX-009, a key milestone for the treatment of hidradenitis suppurativa. Kevin Lind was appointed to the Board of Directors, bringing expertise in financial and corporate strategy. The leadership team also expanded with Taylor Boyd as Chief Business Officer and Ashley Ivanowicz as Senior Vice President of Human Resources, signaling a focus on operational and strategic growth.