Precipio 2025 Q1 Earnings Strong Performance as Net Loss Improves 57.5%

Precipio (PRPO) reported its fiscal 2025 Q1 earnings on May 14th, 2025. Precipio exceeded expectations with significant year-over-year improvements in net loss and revenue growth. The company delivered impressive results, narrowing its net loss by 57.5% compared to the previous year, while revenue surged by 43% YoY to $4.9 million. Management raised guidance, anticipating a return to positive operating cash flow by Q2 or Q3 2025, further supported by non-recurring income and expanded reimbursement opportunities. Precipio is poised for a transformative year, translating these gains into long-term shareholder value.

Revenue

Precipio reported a robust 41.2% increase in total revenue for 2025 Q1, amounting to $4.91 million, up from $3.48 million in the same quarter of 2024. The company's service revenue, net of adjustments, reached $4.26 million, complemented by product revenue of $654,000. An adjustment for credit losses accounted for $18,000, contributing to net sales of $4.93 million.

Earnings/Net Income

Precipio narrowed losses to $0.59 per share in 2025 Q1, marking a 59.6% improvement from a loss of $1.46 per share in 2024 Q1. The net loss reduced to $-884,000 from $-2.08 million. The improved EPS reflects positive financial progress.

Price Action

The stock price of Precipio has edged down 1.72% during the latest trading day, has climbed 6.68% during the most recent full trading week, and has surged 22.51% month-to-date.

Post-Earnings Price Action Review

Over the past five years, buying Precipio shares following its revenue increase on earnings report dates has yielded strong results. The strategy of holding shares for 30 days post-revenue raise has consistently captured market momentum, significantly contributing to returns. In Q1 2025, Precipio demonstrated a 43% revenue growth year-over-year, reaching $4.9 million. Adjusted EBITDA saw marked improvement, narrowing losses by 92%, from ($1,409,000) to ($108,000). The company's cash used in operations decreased by 93% year-over-year to ($44,000), indicating a substantial improvement in cash burn metrics. This suggests Precipio is nearing operational cash flow positivity, projected for Q2 or Q3 2025. Gross margins expanded dramatically, rising from 27% to 43% year-over-year, with the Products division improving from 37% to 51%, and Pathology Services from 24% to 42%. These strides reflect enhanced operational efficiency and a promising business trajectory.

CEO Commentary

"We remain confident in the Company’s trajectory, supported by strong year-over-year revenue growth, improved gross margins, disciplined cost control, and increasing operational efficiency," said Ilan Danieli, CEO of Precipio. He highlighted a Q1 2025 revenue of $4.9 million, a 43% increase year-over-year, despite a seasonal decline from Q4 2024. Danieli noted improvements in Adjusted EBITDA, which was ($108K) compared to ($1,409K) the previous year, reflecting effective cost management. He emphasized the anticipation of momentum in their Product business pipeline and expanded reimbursement opportunities in Pathology Services, reinforcing expectations for continued revenue growth and a transformative year ahead.

Guidance

Management expects to return to positive operating cash flow by Q2 or Q3 of 2025. They anticipate continued revenue growth in both the Products and Pathology Services divisions, with gross margins projected to stabilize in the mid-40% range for Pathology Services and increase for Products. The company aims to maintain adequate cash reserves for operations, bolstered by approximately $400,000 in non-recurring income from an employee retention credit.

Additional News

Precipio has announced a significant change in its executive compensation structure, implementing performance-based stock options for senior management. These options will only vest when the company's 10-day VWAP exceeds $30.30 per share, demonstrating management's confidence in the company's growth potential. The company has also repriced a portion of its employee stock options to enhance retention, aligning incentives with shareholder value. Additionally, Precipio has expanded its Bloodhound™ MPN Panel by adding CALR mutation subtyping, which aligns with the latest NCCN guidelines and enhances treatment strategies for MPN patients.