AETHLON MEDICAL INC (AEMD)·Q1 2026 Earnings Summary

Executive Summary

• Fiscal Q1 2026 delivered a narrower loss year over year as operating expenses fell 31.6% to $1.79M; EPS was ($0.85), better than consensus ($0.86) and prior year ($2.76) . EPS beat by $0.01 versus Wall Street, while revenue remained $0, consistent with development-stage status * .
• Clinical catalyst: DSMB confirmed safety in first oncology cohort and recommended advancing to two Hemopurifier treatments per week in Cohort 2, with sites actively screening under an amended protocol to broaden eligibility .
• Strategic focus sharpened: management cancelled the India oncology trial to conserve $0.5–$1.0M and avoid timeline risk, concentrating resources on faster-moving Australian sites .
• R&D narrative strengthening: preclinical data showed 98.5% removal of platelet-derived EVs; Long COVID poster presented at Keystone Symposium, underpinning platform optionality .
• Balance sheet: cash declined to $3.77M at quarter-end with going concern disclosure; equity financing and/or partnerships remain near-term needs .

What Went Well and What Went Wrong

What Went Well

• DSMB safety validation and progression to Cohort 2: “Following a closed-session deliberation, the DSMB provided … a recommendation to advance to our second treatment cohort where patients will receive two Hemopurifier treatments during a one-week period” .
• Cost discipline: operating expenses down 31.6% YoY, primarily from payroll/related savings and lower legal/consulting fees, reducing operating loss to $1.79M from $2.62M .
• Platform validation: “removed 98.5% of platelet-derived extracellular vesicles … at a time point equivalent to a 4-hour treatment,” supporting oncology and broader applications .

What Went Wrong

• Capital needs and runway: management disclosed “substantial doubt” about going concern; additional capital will be required to fund operations and clinical trials .
• Clinical pace and enrollment: need for added sites and recruitment initiatives (trial liaisons, social media) to accelerate screening/enrollment, indicating execution risk on timelines .
• India trial abandoned: while strategic, cancellation underscores regulatory/logistical challenges and removes a potential source of incremental patient throughput .

Financial Results

Notes:

• Revenue not reported for Q3 2025 or Q1 2025 in the cited releases; Q1 2026 had no revenue recognized .

KPIs

Estimates vs Actual (Q1 2026)

Values marked with * were retrieved from S&P Global.

Guidance Changes

Earnings Call Themes & Trends

Management Commentary

• “In the first quarter, we advanced our lead oncology program, delivered preclinical results supporting broader applications including Long COVID — all while significantly reducing operating expenses.” — James Frakes, CEO/CFO .
• “We remain committed to driving the Hemopurifier toward regulatory approval and unlocking its potential across multiple disease areas.” — James Frakes .
• “We expect to conserve $500,000 to $1,000,000 by this decision [cancelling India], … focusing our resources in Australia, which keeps us on the fastest track toward our next milestone.” — James Frakes .
• “All three participants completed the entire four hour Hemopurifier treatment without any device deficiencies and no immediate complications … none … experienced a dose limiting toxicity or a device related serious adverse event.” — Steven LaRosa, CMO .

Q&A Highlights

• Safety endpoint trajectory: Analysts confirmed understanding that primary endpoint is safety; management noted DSMB sign-off to proceed to Cohort 2 — reinforcing clinical momentum .
• Expense and capital: Discussion focused on the depth of cost reductions, the strategic nature of the India cancellation, and timing/likelihood of future capital raises or strategic partnerships .
• Enrollment acceleration: Management outlined prescreening logs, two additional sites recruitment, trial liaisons, and social media to hasten enrollment; early data readouts expected September 2025 from central lab .
• Australia R&D rebate: Confirmed ~43% cash rebate remains in place, supporting economics of AU trial execution .

Estimates Context

• Q1 2026 EPS of ($0.85) modestly beat the consensus ($0.86) by $0.01; revenue matched consensus at $0, consistent with development-stage status. Three estimates underpin consensus for EPS and revenue, indicating limited but present coverage. Values retrieved from S&P Global.*
• Near-term EPS consensus points to continued losses with narrowing over time (e.g., forward quarters), but magnitude remains sensitive to opex cadence and trial-related spend.*

Key Takeaways for Investors

• Clinical advancement is the core catalyst: DSMB’s Cohort 2 greenlight and broadened eligibility should increase data velocity; early central lab observations in September 2025 may influence sentiment .
• Expense discipline is real: sustained reductions lowered operating loss; however, going concern disclosure and cash decline necessitate timely financing or partnerships .
• Strategic focus should reduce execution risk: cancelling India avoids regulatory delays and aligns resources with AU trial throughput; savings of $0.5–$1.0M help bridge to next milestones .
• Platform optionality (oncology + infectious disease/Long COVID) is building via EV data and academic collaborations; external validation could open non-dilutive funding pathways .
• Trading implications: the September 2025 lab observations and Cohort 2 enrollment pace are likely near-term stock catalysts; financing announcements (equity/partner) will be pivotal given going concern .
• Medium-term thesis: if AU safety/feasibility demonstrates EV reduction and improved T-cell activity, PMA-enabling efficacy design could emerge; execution on manufacturing component qualification remains a dependency .
• Risk management: monitor cash runway, listing requirements, and enrollment trends; Australian R&D cash rebate (~43%) provides structural cost relief but does not replace external capital .