SPRY Plummets 11.5%: What's Behind the Sharp Decline?

Summary
• ARS Pharmaceuticals (SPRY) reports $15.7M revenue, driven by $12.8M in neffy U.S. sales
• Q2 2025 net loss widens to $0.46/share, missing Zacks’ $0.41 estimate
• Stock plummets 11.5% to $14.74, hitting intraday low of $14.5001

Today’s sharp selloff in SPRY follows a mixed earnings report, where revenue outperformed estimates but SG&A costs surged to $54.3M. The stock’s 180-basis-point drop from its 52-week high of $18.90 underscores investor skepticism over commercialization costs and near-term profitability. With 93% U.S. commercial coverage achieved for neffy, the focus now shifts to whether the company can scale efficiently.

Q2 Loss and SG&A Surge Drive SPRY's Sharp Decline
ARS Pharmaceuticals’ stock collapsed 11.5% after reporting a $44.9M net loss for Q2 2025, driven by $54.3M in SG&A expenses tied to its national DTC campaign and sales force expansion. While U.S. neffy revenue rose to $12.8M (up from $0.5M in Q2 2024), the company’s aggressive spending—combined with a 52% gross-to-net retention rate—spooked investors. The market’s reaction reflects concerns over the sustainability of growth amid rising costs and the need for further market share gains in a competitive epinephrine space.

Pharma Sector Mixed as JNJ Gains, SPRY Plummets
The broader pharmaceutical sector showed mixed momentum, with Johnson & Johnson (JNJ) rising 0.46% on strong earnings. However, ARS Pharmaceuticals’ 11.5% drop highlighted its unique challenges: high SG&A costs and unprofitable growth. While JNJ’s diversified portfolio and stable cash flow insulated it from volatility, SPRY’s reliance on commercial expansion and regulatory milestones left it vulnerable to investor caution.

Options and ETFs for Navigating SPRY’s Volatility
• 200-day average: 13.99865 (below current price)
• RSI: 35.8 (oversold)
• MACD: 0.0328 (bullish divergence)
• Bollinger Bands: Price at 14.74 (near lower band at 16.707)

SPRY’s technicals suggest a short-term oversold condition, but structural risks remain. Key support at 14.26 (200D MA) and resistance at 17.68 (middle Bollinger band) define a volatile range. The SPRY20250919P15 put option (strike $15, expiring 9/19) offers high leverage (12.24%) and a delta of -0.44, ideal for capitalizing on a 5% downside scenario (projected payoff: $0.26). The SPRY20250919C15 call (delta 0.588) provides bullish exposure with a 6.12% leverage ratio, though its -24.8% price change ratio signals risk. Both contracts have moderate implied volatility (67.08% and 124.96%) and decent liquidity (835 turnover for the call). Aggressive bulls may consider the C15 into a bounce above $17.68, while bears should watch for a breakdown below $14.26.

Backtest ARS Pharmaceuticals Stock Performance
The -12% intraday plunge in SPRY shares presents a compelling opportunity for a potential rebound. Historical patterns following significant dips suggest a cautious optimistic outlook.1. Recent Performance: SPRY recently experienced a quarterly loss of $0.46 per share, which was worse than expected. Despite this, the stock rose 3.7% to $17.28 premarket after reporting Q2 revenue of $15.72 million, surpassing estimates of $13.78 million.2. Market Reaction: The market's reaction to the Q2 earnings report has been positive, despite the initial negative earnings surprise. This suggests that investor sentiment may shift in favor of the stock following the price drop.3. Technical Analysis: The stock's price-to-earnings (P/E) ratio is currently negative at -11.38, which is unusual but could indicate a low valuation that may attract investors looking for value opportunities. The 2025 P/E ratio for NYAX, another stock in the same industry, is 78.53, suggesting that SPRY may have higher earnings growth potential than its competitors.4. Future Prospects: The company anticipates regulatory approval for its nasal spray, neffy, in several countries by the end of 2025, with commercial rollouts planned for 2026. This could lead to increased revenue and stock price appreciation as the product becomes available in new markets.In conclusion, while the -12% intraday plunge in SPRY presents risks, the company's ability to beat revenue estimates, positive market reactions, and future growth prospects suggest a potential for rebound. Investors should consider the company's fundamentals, market conditions, and the potential risks before making investment decisions.

SPRY’s Crossroads: Profitability or Expansion?
ARS Pharmaceuticals faces a critical juncture as it balances commercial momentum with profitability. While neffy’s 180% Q2 script growth and global expansion in the U.K. and Germany are positives, the stock’s sharp decline reflects skepticism over SG&A efficiency. Investors should monitor the 14.26 support level and Johnson & Johnson’s (JNJ, +0.46%) broader sector performance for clues on pharma market sentiment. For now, a cautious approach—leveraging options like SPRY20250919P15 for downside protection—seems prudent as the company navigates its three-year cash runway.