Keros 2025 Q1 Earnings Record Profit with Net Income Up 444%

Keros Therapeutics (KROS) reported its fiscal 2025 Q1 earnings on May 06th, 2025. The company achieved a net income of $148.5 million, a remarkable turnaround from a $43.1 million loss in Q1 2024. This result exceeded market expectations, driven by significant revenue from a licensing agreement with Takeda Pharmaceuticals. Looking ahead, Keros maintains its guidance for the release of Phase 2 TROPOS trial data for cibotercept in Q2 2025. The company expects its cash reserves to fund operations through 2029, providing a strong financial position to support its strategic goals.

Revenue
Keros' total revenue surged to $211.25 million in 2025 Q1, marking a dramatic increase from $83,000 in 2024 Q1. Service and other revenue contributed $15.89 million, while licensing revenue from the Takeda agreement added a substantial $195.35 million, underscoring the company's robust financial performance.

Earnings/Net Income
Keros returned to profitability with an EPS of $3.66 in 2025 Q1, marking a 402.5% positive change from a $1.21 per share loss in 2024 Q1. The net income of $148.45 million represents a significant 444.3% positive swing from the previous year's loss, showcasing the company's exceptional financial turnaround. This EPS performance is a strong indicator of Keros' financial health.

Price Action
The stock price of Keros fell by 4.78% during the latest trading day and week but experienced a 33.85% surge month-to-date.

Post-Earnings Price Action Review
Keros' post-earnings strategy of buying shares after a revenue drop quarter-over-quarter and holding for 30 days has yielded a 44.83% return over the past five years, though this was under the benchmark return of 83.12%, leading to an excess return of -38.29%. The strategy exhibited a compound annual growth rate (CAGR) of 7.78%, with a Sharpe ratio of 0.72, a maximum drawdown of -10.44%, and a volatility of 10.83%. While the strategy has been moderately effective, it hasn't matched the general market performance, indicating room for improvement in the company's approach to enhancing stockholder value.

CEO Commentary
Keros Therapeutics, Inc. (KROS) reported strong first-quarter 2025 performance, highlighted by initial topline results from the Phase 1 clinical trial of KER-065, which met key objectives and provided valuable insights. Dr. Jasbir S. Seehra, Chair and Chief Executive Officer, expressed optimism regarding the advancement of KER-065 to a Phase 2 clinical trial in early 2026. He emphasized the ongoing evaluation of strategic alternatives by the Board of Directors to enhance stockholder value, while reaffirming the commitment to advancing the company's pipeline and executing its strategic goals, particularly with upcoming data from the Phase 2 TROPOS trial for cibotercept.

Guidance
Keros anticipates reporting Phase 2 TROPOS trial data for cibotercept in the second quarter of 2025 and plans to assess the development strategy for the product following this data readout. The company expects that its cash and cash equivalents as of March 31, 2025, estimated at $720.5 million, will support operating expenses and capital expenditures through 2029.

Additional News
Keros Therapeutics (NASDAQ: KROS) has initiated a strategic review process to maximize stockholder value, considering potential sale, business combinations, or returning excess capital. A Strategic Committee of independent directors is overseeing this review, which includes a stockholder rights plan to prevent hostile takeovers. Additionally, Keros has announced a complete halt of dosing in its Phase 2 TROPOS trial of cibotercept for PAH due to safety concerns, although they plan to present topline data in Q2 2025. The company is also advancing KER-065 into Phase 2 trials for Duchenne muscular dystrophy pending regulatory interactions.