Geron 2025 Q1 Earnings Significant Revenue Growth but Misses Expectations

Geron (GERN) reported its fiscal 2025 Q1 earnings on May 07th, 2025. The company missed revenue expectations, generating $39.60 million against an analyst estimate of $50.5 million. Despite this, Geron maintained its guidance for operating expenses, projecting a range of $270 million to $285 million for the year. With increased commercial investments, the company anticipates continued momentum throughout 2025. The interim analysis of the IMPACT MS Phase III trial is expected in the second half of 2026, which could potentially double Rytelo's commercial opportunity.

Revenue

Earnings/Net Income
Geron narrowed losses to $0.03 per share in 2025 Q1 from a loss of $0.09 per share in 2024 Q1 (66.7% improvement). Meanwhile, the company successfully narrowed its net loss to $-19.84 million in 2025 Q1, reducing losses by 64.2% compared to the $-55.39 million net loss reported in 2024 Q1. The Company has sustained losses for 14 years over the corresponding fiscal quarter, highlighting ongoing financial headwinds. The EPS performance shows a positive trend but remains below profitability.

Price Action

Post-Earnings Price Action Review
Over the past five years, investing in Geron shares following a revenue increase and holding for 30 days has yielded moderate returns, albeit with considerable volatility and risk. The strategy's compound annual growth rate (CAGR) was 6.68%, falling short of the benchmark by 77.4 percentage points. A maximum drawdown of -32.38% and a Sharpe ratio of 0.26 emphasize the challenging risk-return profile of this approach, underscoring the critical need for risk management when dealing with such volatility.

CEO Commentary
Dawn Bir - Interim President and Chief Executive Officer: "RYTELO U.S. commercial launch success is our number one corporate priority. Q1 RYTELO net revenues were 39.4 million, down 8 million from Q4, while demand was relatively flat at +1%. We believe that there is a large U.S. market opportunity for RYTELO. We expect our increased commercial investments to bolster uptake across a broader group of prescribers. Our strategy focuses on enhancing brand awareness, refining marketing efforts, and expanding KOL support. We are optimistic about recent early performance indicators and believe we are on the right path to drive value for all involved."

Guidance
Geron expects total operating expenses for fiscal year 2025 to range from approximately 270 million to 285 million. The company anticipates that Q2 will show continued momentum building from Q1, with the impact of increased commercial investments expected to be realized throughout 2025. The interim analysis for the IMPACT MS Phase III trial is anticipated in the second half of 2026, with the potential to double RYTLEO’s commercial opportunity if successful.

Additional News
In recent weeks, Geron has faced significant developments outside of its earnings report. The company is currently embroiled in a class action lawsuit filed by several law firms, including Kirby McInerney LLP and Robbins Geller Rudman & Dowd LLP. The lawsuit alleges that Geron misled investors about the growth potential of its drug, Rytelo, citing issues like seasonality, competition, and monitoring requirements. This legal action follows Geron's Q4 2024 financial results announcement, where it acknowledged flattened growth for Rytelo. The legal proceedings may impact investor sentiment and the company's future strategic decisions.