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Lantheus Holdings, Inc. (LNTH) Q1 2025 Earnings Summary

Executive Summary

  • Q1 2025 revenue was $372.8M and adjusted diluted EPS was $1.53; both missed Wall Street consensus, driven by PYLARIFY pricing/reimbursement transition and competitive dynamics among smaller, non‑contracted sites, while DEFINITY grew 3.5% year over year . Results vs estimates: revenue $372.8M vs $379.1M* and adjusted EPS $1.53 vs $1.65*; EBITDA $120.4M* vs $172.9M* — a broad miss across key lines .*
  • Management tightened FY25 guidance: revenue to $1.55–$1.585B (from $1.545–$1.610B) and lowered adjusted EPS to $6.60–$6.70 (from $7.00–$7.20), reflecting updated PYLARIFY trajectory (flat to low single-digit growth) and increased R&D investment (~7.5% of revenue) .
  • Strategic repositioning accelerates: closed Evergreen (OCTEVY, theranostic pairs) in April, expects Life Molecular Imaging (Neuraceq) soon, and announced SPECT divestiture to SHINE to focus on PET diagnostics/microbubbles; MK‑6240 met pivotal sensitivity/specificity endpoints with NDA planned in Q3 2025 — key multi‑year growth catalysts .
  • Operating cadence: gross margin was 67% with 180 bps YoY compression from strategic partnership contracting, dose mix, and a brief moly supply issue; free cash flow was $98.8M and cash reached $938.5M, underscoring ample liquidity amid portfolio realignment .

What Went Well and What Went Wrong

What Went Well

  • PYLARIFY volumes grew YoY; Lantheus maintained a pricing premium and secured the majority of revenue through strategic partnerships, positioning for broader portfolio launches (e.g., NEURACEQ, OCTEVY, MK‑6240) .
  • DEFINITY achieved ~$79M in Q1 sales, remaining the #1 ultrasound-enhancing agent despite competitive supply returning to the U.S. market .
  • MK‑6240 met co‑primary endpoints in two pivotal studies; NDA filing planned for Q3 2025, building an Alzheimer’s imaging franchise with NAV‑4694 and anticipated LMI assets .

Selected quotes:

  • “We are laying the foundation for the next chapter… acquisitions… add growth drivers… diversify our revenues” — CEO Brian Markison .
  • “We plan to maintain our market leadership… broaden contracting… expand product availability… maintain pricing premium” — CCO Amanda Morgan on PYLARIFY .
  • “MK‑6240… met its primary endpoints… [we] plan to submit a New Drug Application… in the third quarter” — CEO Brian Markison .

What Went Wrong

  • Pricing/reimbursement transition (mean unit cost for Medicare FFS hospital outpatient) and competitive disruption among small, later‑adopter sites pressured PYLARIFY net price; management shifted FY25 PYLARIFY growth view to flat to low single-digit from low‑to‑mid single-digit .
  • Gross margin compressed ~180 bps YoY on contracting impacts, dose volume mix, higher freight, and brief moly supply shortage affecting TechneLite .
  • EBITDA and adjusted EPS missed consensus, reflecting broader profitability pressure amidst strategic investments and non‑cash equity losses in radiotheranostics holdings .*

Financial Results

MetricQ1 2024Q4 2024Q1 2025
Revenue ($USD Millions)$369.975 $391.110 $372.764
GAAP Diluted EPS ($)$1.87 $(0.17) $1.02
Adjusted Diluted EPS ($)$1.69 $1.59 $1.53
Gross Profit Margin %65.37%*63.55%*63.77%*
EBIT Margin %27.13%*28.23%*28.65%*
Net Income Margin %35.43%*-3.01%*19.57%*

Values with * retrieved from S&P Global.

Estimates vs Actuals (Q1 2025):

MetricConsensusActualSurprise
Revenue ($USD)$379.136M*$372.764M Miss (~$6.37M)
Adjusted Diluted EPS ($)$1.65*$1.53 Miss ($0.12)
EBITDA ($USD)$172.874M*$120.420M*Miss (~$52.45M)

Values with * retrieved from S&P Global.

Segment Breakdown (Q1 2025 vs Q1 2024):

SegmentQ1 2024 ($000s)Q1 2025 ($000s)YoY Change
PYLARIFY$258,870 $257,654 (0.5%)
Total Radiopharm Oncology$259,254 $257,654 (0.6%)
DEFINITY$76,564 $79,211 3.5%
TechneLite$21,714 $19,711 (9.2%)
Other Precision Diagnostics$5,932 $5,441 (8.3%)
Total Precision Diagnostics$104,210 $104,363 0.1%
Strategic Partnerships & Other$6,511 $10,747 65.1%
Total Revenues$369,975 $372,764 0.8%

KPIs and Operating Metrics:

KPIQ1 2024Q1 2025
Operating Income ($000s)$106,635 $102,067
Adjusted Operating Income ($000s)$155,293 $144,258
Net Cash from Operating Activities ($000s)$127,238 $107,563
Free Cash Flow ($000s)$118,965 $98,845
Cash & Equivalents ($000s)$912,814 (Dec 31, 2024) $938,533 (Mar 31, 2025)
Weighted Avg Diluted Shares (000s)70,095 71,461

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
RevenueFY 2025$1.545B–$1.610B $1.550B–$1.585B Tightened; top end lowered
Adjusted Diluted EPSFY 2025$7.00–$7.20 $6.60–$6.70 Lowered
PYLARIFY Net Sales GrowthFY 2025Low‑ to mid‑single-digit (prior view) Flat to low single-digit Lowered
R&D Expense (% of Revenue)FY 2025N/A~7.5% of revenue Raised vs prior assumptions
Evergreen ContributionFY 2025 (balance)N/A+~$10M revenue; ~$(0.25) EPS dilution Added (dilutive EPS)
LMI ContributionFY 2025N/AExpected accretive to revenue/EPS post close Added (accretive)
SPECT DivestitureFY 2025N/ANo 2025 revenue/EPS impact (close end‑year) No near‑term impact; future margin tailwind

Earnings Call Themes & Trends

TopicPrevious Mentions (Q3 2024, Q4 2024)Current Period (Q1 2025)Trend
CMS reimbursement for diagnosticsCY25 OPPS rule improves payment; PYLARIFY paid separately post pass‑through Mean unit cost transition caused disruption at smaller sites; pursuing ASP discussions with CMS Transition headwind near‑term; potential ASP relief
PYLARIFY performanceOn track to >$1B in 2024; strategic partnerships broadened Volumes up YoY; net price down low‑single digits; competitive disruption at non‑contracted sites Market leadership maintained; pricing mix headwinds
DEFINITY performanceStrong growth; competitor supply challenges aided Q4 $79.2M sales with competitor supply returning; still #1 UEA Durable category leadership
Supply chain (moly)Not highlightedBrief moly supply issue; TechneLite down 9.2% YoY; resolved Transitory
Tariffs/macroNot highlightedMonitoring tariff activity; de minimis direct impact currently Watchlist
Alzheimer’s imagingNAV‑4694 acquired; CY25 rule supportive MK‑6240 pivotal success; NDA Q3; LMI/NEURACEQ pending close Accelerating pipeline/commercial platform
Radiotheranostics (PNT2002/2003)SPLASH interim data confounded by crossover; path forward under review SPLASH reached 100% OS events; no NDA planned for PNT2002; focus shifts to PNT2003 & OCTEVY Portfolio refocus
Portfolio strategyBuilding pipeline, capability expansions Close Evergreen; divest SPECT; expect LMI; align org to PET/microbubbles Streamlining to higher‑growth mix

Management Commentary

  • “Collectively, these transactions… add immediate revenue growth drivers… exciting programs… key capabilities… and streamline and help focus our organization” — CEO Brian Markison on Evergreen, LMI, SPECT sale .
  • “We will… broaden contracting… maintain pricing premium… expand product availability… [and] educate on PYLARIFY’s clinical and commercial differentiation” — CCO Amanda Morgan on commercial strategy .
  • “We are updating the implicit [PYLARIFY] range… to flat to low single‑digit… Evergreen adds ~$10M revenue… reduces adjusted EPS by ~$0.25… adjusted EPS now $6.60–$6.70” — CFO Robert Marshall on guidance .
  • “MK‑6240… met its primary endpoints… we plan to file an NDA in the third quarter” — CEO Brian Markison on AD imaging catalyst .

Q&A Highlights

  • PYLARIFY dynamics: Competitive switching at smaller, later‑adopter accounts post MUC; strategy is to expand contracting and product availability while preserving premium pricing; large strategic accounts remained stable .
  • SPECT divestiture rationale: Non‑core, stable revenue with below‑average margins; sale accelerates consolidated margin expansion and focus on PET/microbubbles; expected close by year‑end .
  • Guidance cadence: Q2 expected sequential growth in dose volumes; back half could reach mid‑single‑digit for PYLARIFY; overall FY pivot to lower band of prior ranges .
  • CMS/ASP: Active discussions; potential ASP emergence; current team continuity despite administration changes; near‑term MUC impacts ~20% of patients (Medicare FFS, hospital outpatient) .
  • Long‑term growth: With OCTEVY, PNT2003, MK‑6240, NEURACEQ annualization, and base PYLARIFY/DEFINITY, management reiterated potential for double‑digit revenue growth in 2026 .

Estimates Context

  • Q1 2025 results vs consensus: Revenue $372.8M vs $379.1M*, adjusted EPS $1.53 vs $1.65*, EBITDA $120.4M* vs $172.9M* — broad‑based misses reflecting pricing/mix headwinds and elevated opex/R&D .*
  • Consensus inputs included 13 EPS estimates and 12 revenue estimates for the quarter [GetEstimates Q1 2025].*
  • Implications: Street likely to lower FY25 EPS forecasts toward $6.60–$6.70 and tighten revenue range; estimate dispersion may narrow given updated PYLARIFY growth view and added Evergreen dilution .*

Values with * retrieved from S&P Global.

Key Takeaways for Investors

  • Near‑term: Expect continued pricing/mix headwinds in PYLARIFY with sequential dose volume growth; focus on contracting expansion to recapture later‑adopter sites — monitor Q2 trajectory and ASP developments with CMS .
  • Portfolio catalysts: MK‑6240 NDA in Q3 2025 and LMI close (Neuraceq) create an Alzheimer’s imaging franchise; Evergreen adds OCTEVY and theranostic capabilities — a multi‑year growth setup .
  • Margin mix: SPECT divestiture (expected close year‑end) should support future gross margin expansion; watch integration execution and timing .
  • FY25 reset: Guidance lowered/tightened; R&D step‑up (~7.5% of revenue) underscores investment phase — supports 2026 double‑digit growth potential if launches/approvals track .
  • Liquidity: $938.5M cash and $750M undrawn revolver provide flexibility for integration and pipeline investments, mitigating execution risk .
  • Trading setup: Stock likely sensitive to reimbursement signals (ASP), PYLARIFY contracting progress, and MK‑6240 regulatory milestones; consider positioning around Q3 NDA filing and LMI close updates .
  • Medium‑term thesis: Diversification beyond PYLARIFY toward AD imaging and theranostics, coupled with margin accretion post SPECT exit, supports a higher‑quality revenue mix by 2026–2027 .

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