AETHLON MEDICAL INC (AEMD)·Q2 2026 Earnings Summary

Executive Summary

• Fiscal Q2 2026 (quarter ended September 30, 2025) showed continued cost discipline with operating expenses down 48% year over year to $1.51M, reducing operating loss to $1.51M and net loss to $1.49M; period-end cash was $5.85M . The company remains pre-revenue .
• EPS was ($3.74), a slight miss vs Wall Street consensus of ($3.66); revenue was in line at $0 vs $0 consensus [functions.GetEstimates].
• Clinical updates were constructive: DSMB cleared cohort 2 in the Australian oncology trial; management shared early “directional” reductions in EVs and encouraging T‑cell changes from cohort 1, with cohort 2 enrollment underway under an amended protocol allowing PD-1 combination regimens .
• Corporate/liquidity: Aethlon regained Nasdaq minimum bid price compliance (Nov. 5), and raised ~$4.5M gross in September; management nonetheless flagged going-concern risk absent additional financing, despite Q2 cost reductions .
• Near-term stock catalysts: cohort 2 enrollment cadence and initial readouts; additional financing clarity; potential Long COVID data manuscript and simplified blood-pump system compatibility workstreams .

What Went Well and What Went Wrong

What Went Well

• Cost structure reset: Operating expenses fell 48% YoY to $1.51M, driven by lower payroll (–$0.78M), G&A (–$0.44M), and professional fees (–$0.18M), aided by a ~$0.218M Australian R&D tax incentive; operating loss narrowed to $1.51M and net loss to $1.49M .
• Clinical momentum within constraints: DSMB endorsed moving to cohort 2; early cohort 1 data showed “directional” decreases in EVs (including PD‑L1+ subsets) and increases in T‑cell populations post-treatment, supporting the device’s mechanistic thesis .
• Listing stability: The company regained compliance with Nasdaq’s minimum bid price requirement, closing a potential delisting overhang .
  • Quote: “We remain focused on executing our clinical and research strategy while maintaining operational discipline” — Jim Frakes, CEO/CFO .

What Went Wrong

• Enrollment friction: Management acknowledged slow cohort 2 enrollment given the novelty of extracorporeal therapy for cancer and patient burden; even with new initiatives (Trialfacts, added sites), pace may be ~1 patient/month and seasonally slower during Australian summer holidays .
• Slight EPS miss: Q2 EPS ($3.74) came in modestly below consensus ($3.66)* despite significant opex cuts [functions.GetEstimates].
• Liquidity risk persists: Despite ~$4.5M gross proceeds from the Sept. offering and $5.85M quarter-end cash, management disclosed substantial doubt about going concern without additional financing .

Financial Results

P&L snapshot (USD Millions, except per-share)

Liquidity

EPS and revenue vs S&P Global consensus

Notes: Aethlon reports no revenue; margin metrics not applicable .
*Values retrieved from S&P Global.

Operating expense mix (USD)

Guidance Changes

Management did not issue revenue, margin, opex, or tax guidance; disclosures focused on clinical milestones and operating discipline .

Earnings Call Themes & Trends

Management Commentary

• Strategic focus and discipline: “We remain focused on executing our clinical and research strategy while maintaining operational discipline” — Jim Frakes, CEO/CFO .
• Early clinical signals: “Directionally, EV decreases is what we want to see… and some improvement in different lymphocyte populations… They’re going directionally in the right way” — Dr. Steven LaRosa, CMO .
• Enrollment realism: “This is not an easy sell to patients… extracorporeal therapies for cancer patients is a novel concept… The slow enrollment… is not all that unexpected” — Dr. Steven LaRosa .
• Grants only if aligned: “If the government contract was aligned close to perfectly with our goals… we are not averse to doing it, but it has to be the right contract or grant” — Jim Frakes .

Q&A Highlights

• Enrollment cadence and acceleration: Management reiterated a ~1 patient/month target, noted seasonal holiday slowdown in Australia, and outlined initiatives (digital marketing via Trialfacts, additional sites, investigator training) to improve throughput .
• Data durability: EV levels decline during treatment (2–4 hours) and generally rebound over weeks; cohort 2 aims to test whether more treatments deepen and prolong EV reductions and T‑cell effects .
• Indication focus and grants: Company remains oncology-focused; open to non-dilutive grants only if program-aligned given thin overhead economics of many contracts .
• Financing and burn: Despite cost reductions, management acknowledged continued need to raise capital to fund development; going-concern risk disclosed .

Estimates Context

• EPS: Actual ($3.74) modestly missed consensus ($3.66)*; thin coverage (3 estimates) contributes to volatility in estimate accuracy [functions.GetEstimates].
• Revenue: In line at $0 vs $0 consensus*, consistent with development-stage profile [functions.GetEstimates].
• Target price and coverage: Consensus target ~$12.38*; no consensus recommendation text available; coverage remains limited (3 analysts on EPS/Revenue) [functions.GetEstimates].
  *Values retrieved from S&P Global.

Key Takeaways for Investors

• Execution/watch items: Track cohort 2 enrollment velocity and timing of next mechanistic readouts (EV/T‑cell) as primary catalysts for sentiment and potential partnering conversations .
• Cost discipline is delivering: Opex down 48% YoY with targeted savings across payroll, G&A, and professional fees, aided by Australian R&D incentives; but absolute cash burn still necessitates financing in the near to medium term .
• Liquidity/listing: Regained Nasdaq bid compliance reduces technical risk, but going-concern disclosure highlights urgency to secure capital; September equity raise (~$4.5M gross) extended runway, but is not sufficient for 12 months .
• Clinical rationale strengthening: Early “directional” signals (EV reductions, T‑cell changes) are consistent with the Hemopurifier’s mechanism; dose-response in cohort 2 is a key validation milestone .
• Secondary narratives: Long COVID EV research (with UCSF) and simplified single-lumen/pump system evaluation could broaden addressable settings and lower procedural barriers if successful; monitor manuscript submissions and feasibility updates .
• Trading implications: Near term, stock likely sensitive to enrollment updates, financing announcements, and any cohort 2 datapoints; medium term, mechanistic validation and regulatory pathway clarity (PMA design) will be central to the thesis .

References

• Q2 2026 10-Q (financials, going concern, operations):
• Q2 2026 8-K & Press Release (full earnings PR and highlights):
• Q2 2026 Earnings Call Transcript (strategy, cohort 2, Q&A):
• Prior quarters (trend): Q1 2026 PR and call ; Q4 2025 PR and call
• Additional Q2-period updates: EV observations PR (Oct 7, 2025) ; Nasdaq compliance 8-K (Nov 6, 2025) ; Sept 2025 public offering PR