Xencor 2025 Q2 Earnings Strong Revenue Growth, 55.2% Reduction in Net Loss

Xencor (XNCR) reported its fiscal 2025 Q2 earnings on August 6, 2025, delivering a robust revenue performance while significantly narrowing its net loss. The company’s total revenue surged 82.4% year-over-year to $43.61 million, surpassing expectations, and it reduced its net loss by 55.2% to $-30.82 million compared to $-68.78 million in the same period in 2024.

Revenue
Xencor’s revenue was driven almost entirely by collaborations, milestones, and royalties, which accounted for the full $43.61 million in total revenue. This substantial increase highlights the continued impact of key partnership milestones and royalty income from partners such as Incyte and Alexion. The absence of other revenue streams this quarter underscores the company’s reliance on collaboration-based income to fuel its financial performance.

Earnings/Net Income
Xencor reported a loss of $0.41 per share in the second quarter, a 62.4% improvement from the $1.09 per share loss in the prior-year period. The company’s net loss narrowed to $-30.82 million, reflecting disciplined cost management and increased revenue from milestone and royalty payments. This marked improvement in earnings per share demonstrates progress in stabilizing the company’s financial position.

Price Action
Following the earnings release, Xencor’s stock experienced a decline in performance. The stock dropped 5.43% in the latest trading day, 14.20% during the most recent full trading week, and 5.67% month-to-date, signaling mixed investor sentiment in the short term.

Post Earnings Price Action Review
A post-earnings investment strategy, which involved purchasing shares on the earnings report date and holding for 30 days, performed poorly. The strategy recorded a return of -73.34%, significantly underperforming the 48.58% benchmark return, with an excess return of -121.93%. Over a three-year horizon, the compound annual growth rate (CAGR) was -36.64%, indicating substantial losses. While the strategy reported a maximum drawdown of 0.00%, it had a Sharpe ratio of -0.74 and a volatility of 49.73%, underscoring its high-risk profile and erratic performance.

CEO Commentary
Bassil Dahiyat, Ph.D., President and CEO of Xencor, highlighted the company’s ongoing focus on clinical development for four wholly owned XmAb® drug candidates in oncology and autoimmune diseases. Xencor is advancing the T-cell engager programs XmAb819 and XmAb541 through dose-escalation trials, with preliminary XmAb819 data expected later this year. In autoimmune diseases, the Phase 2b XENITH-UC trial for XmAb942 in ulcerative colitis has started, and regulatory clearance was secured for a plamotamab study in rheumatoid arthritis. The company plans to initiate a global proof-of-concept study for XmAb657, reinforcing its commitment to advancing its pipeline. The CEO’s comments reflect a confident and forward-looking stance on the company’s therapeutic development and execution capabilities.

Guidance
Based on current operating plans, Xencor expects to finish 2025 with $555 million to $585 million in cash, cash equivalents, and marketable securities. This level of liquidity is projected to fund operations and R&D through 2028. As of June 30, 2025, the company held $663.8 million in cash and marketable debt securities, down from $706.7 million at the end of 2024. The Q2 revenue increase was primarily attributable to milestone and royalty income from strategic partners.

Additional News
In the three weeks following Xencor’s August 6 earnings report, the company did not announce any mergers and acquisitions, executive leadership changes, or shareholder return initiatives such as dividends or buybacks. The focus remained squarely on clinical and financial progress rather than structural or capital return decisions. Xencor continued to emphasize its drug development pipeline and therapeutic collaborations, with no notable strategic shifts reported in the immediate period. The absence of major non-earnings announcements suggests the company is currently prioritizing operational execution and clinical trial advancement over external transactions or capital structure adjustments.