Merus 2025 Q2 Earnings Deepened Losses Despite Revenue Growth

Merus reported its fiscal 2025 Q2 earnings on August 5, 2025, showing a 20.4% year-over-year increase in revenue but wider-than-expected net losses. The company’s performance fell short of profitability expectations, with guidance reflecting continued investment in late-stage clinical trials and R&D.

Revenue
Merus achieved a total revenue of $8.83 million in the second quarter of 2025, representing a 20.4% increase from $7.33 million in the same period in 2024. The revenue was primarily driven by collaboration activities, with upfront payments accounting for the largest share at $5.90 million. Additional contributions came from reimbursement revenue of $1.94 million and milestone payments of $980,000. The remaining portion of the revenue came from other collaboration sources, demonstrating the company’s ongoing reliance on partnership-based income to support its operations.

Earnings/Net Income
Merus’s losses widened significantly in the second quarter of 2025, with a net loss of $158.22 million, representing a 216.2% increase from the $50.04 million loss in the same period of 2024. On a per-share basis, the loss expanded to $2.23 from $0.81, a 175.3% deterioration. The continued losses highlight the company’s heavy R&D expenditures and ongoing investment in late-stage clinical trials. The EPS performance was negative and significantly below breakeven.

Price Action
Merus’ stock has shown positive short-term momentum, rising 0.39% in the latest trading day, 2.32% over the past week, and surging 25.33% month-to-date as of the earnings release date.

Post-Earnings Price Action Review
A strategy of buying Merus shares following a revenue increase and holding for 30 days yielded an impressive 193.82% return over the past three years, vastly outperforming the 0.00% return of the benchmark. This suggests that the market may be valuing the company’s progress in clinical development and revenue diversification despite its financial losses. The significant excess return indicates strong investor confidence in Merus’ long-term potential and its strategic focus on revenue-generating collaborations and therapeutic innovation.

CEO Commentary
Bill Lundberg, President and CEO of Merus, emphasized the company’s progress in advancing petosemtamab, a key therapeutic candidate. The interim phase 2 data in 1L PD-L1+ r/m HNSCC showed a robust 63% response rate among 45 patients and a 79% overall survival rate at 12 months, outperforming historical controls. The CEO also highlighted the ongoing phase 3 trials, LiGeR-HN1 and LiGeR-HN2, expected to be substantially enrolled by year-end 2025. With two Breakthrough Therapy designations for petosemtamab, Merus is positioning itself for potential accelerated approval pathways. The CEO reaffirmed the team’s ability to execute on key milestones and the continued value of the Biclonics® platform in driving future collaborations and clinical development.

Guidance
Merus expects its current cash, cash equivalents, and marketable securities to fund operations through 2028. The company aims to complete key phase 3 trial enrollment for petosemtamab by the end of 2025 and anticipates initial clinical data in mCRC by the second half of the year. Collaboration revenue is expected to continue, with R&D expenses rising due to ongoing clinical trials.

Additional News
In the three weeks following the Q2 earnings report, Merus announced the pricing of a public offering of common shares on June 4, 2025, as part of its capital-raising efforts. The company also announced inducement grants under Nasdaq Listing Rule 5635(c)(4) on August 4, 2025, signaling ongoing management incentive activity. Additionally, Merus was set to present at several investor conferences, including the BofA Securities 2025 Health Care Conference and the Citi 2025 Virtual Oncology Leadership Summit, reflecting the company’s strategic focus on investor engagement and market visibility.