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NovoCure Ltd (NVCR)·Q3 2025 Earnings Summary

Executive Summary

  • Q3 revenue of $167.2M grew 8% YoY and 5.3% QoQ, beating S&P Global consensus by ~$8.3M (+5.2%); EPS loss of $0.33 beat by ~$0.09, while EBITDA was more negative than consensus given pre-reimbursement lung treatments, HFE rollout, and tariffs ; consensus values marked with asterisks retrieved from S&P Global (see Estimates Context).*
  • GBM franchise remained stable with 4,277 Optune Gio active patients (+5% YoY) and strong ex-U.S. momentum (France/Japan/Germany); lung (Optune Lua) remained behind expectations at 100 active NSCLC patients, but Japan approval was secured with national reimbursement expected in coming quarters, a key launch catalyst .
  • Margin headwinds persisted (73% gross margin vs 77% YoY) from HFE array rollout, treating NSCLC prior to broad reimbursement, tariffs, and a $2.9M Lua array obsolescence provision; CFO now expects FY gross margin to land mid-70% vs prior expectation of low-70%—a constructive update .
  • Regulatory pipeline de-risking continues: pancreatic cancer PMA accepted and in substantive review (mid-2026 approval targeted), METIS PMA completion by YE25; Spain coverage for GBM and Japan approval for Lua expand the commercial footprint .
  • Liquidity remains strong ($1.034B cash/investments) with $561M convert set to be retired with cash; management re-affirmed adjusted EBITDA break-even in 2027 at ~$700–$750M revenue as new indications scale .

What Went Well and What Went Wrong

  • What Went Well

    • Revenue and EPS beats: $167.2M revenue (+8% YoY) and EPS ($0.33) outperformed consensus; GBM steady, FX tailwind +$3.3M, ex-U.S. growth notable . Consensus from S&P Global.*
    • Regulatory/commercial wins: Japan approval for Lua concurrent with PD-1/PD-L1; Spain national coverage for GBM; pancreatic PMA entered substantive review; METIS presented in ASTRO plenary with positive TTIP outcome .
    • Improved FY gross margin outlook: CFO now sees FY gross margin trending mid-70% (vs low-70% earlier), aided by cost reduction progress on HFE arrays .

  • What Went Wrong

    • Lung launch lagging: Management acknowledged Lua ramp “harder than expected” with 100 NSCLC patients on therapy; competitive drug landscape and 4-month median therapy duration weigh on traction .
    • Margin headwinds: Gross margin fell to 73% (from 77% YoY) on HFE rollout, pre-reimbursement lung treatment, tariffs, plus $2.9M Lua array obsolescence .
    • Continued losses: Net loss ($37.3M) and adj. EBITDA ($3.0M) negative; EBITDA more negative than consensus, reflecting the above cost dynamics and pre-reimbursement mix . Consensus from S&P Global.*

Financial Results

Consolidated P&L and Profitability (Q1–Q3 2025)

MetricQ1 2025Q2 2025Q3 2025
Revenue ($USD Millions)$155.0 $158.8 $167.2
Diluted EPS ($)$(0.31) $(0.36) $(0.33)
Gross Margin %75% 74% 73%
R&D ($M)$53.8 $55.8 $54.0
Sales & Marketing ($M)$55.8 $57.1 $58.5
G&A ($M)$44.8 $44.0 $45.9
Net Income (Loss) ($M)$(34.3) $(40.1) $(37.3)
Adjusted EBITDA ($M)$(5.0) $(9.9) $(3.0)

Q3 2025 Actual vs S&P Global Consensus

MetricConsensusActualSurprise
Revenue ($M)$158.94*$167.20 +$8.27
Primary EPS ($)$(0.420)*$(0.33) +$0.09
EBITDA ($M)$(25.70)*$(32.36) $(6.66)

Values marked with an asterisk (*) are retrieved from S&P Global.

Geographic and Product Contributions (Q1–Q3 2025)

Metric ($USD Millions)Q1 2025Q2 2025Q3 2025
U.S. Revenue$93.2 $94.3 $96.6
Germany$18.7 $19.1 $20.3
France$17.9 $18.4 $19.6
Japan$8.7 $9.5 $9.4
Other Active Markets$11.9 $13.0 $15.7
Greater China (Zai Lab)$4.6 $4.6 $5.6
Optune Lua Recognized Revenue (Total)$1.5 $2.4 $3.1
— Lua NSCLC$0.7 $1.1 $1.6
— Lua MPM$0.8 $1.3 $1.5

Key Operating Metrics (Q1–Q3 2025)

KPIQ1 2025Q2 2025Q3 2025
Total Active Patients (End of Period)4,268 4,331 4,416
Optune Gio Active4,162 4,194 4,277
Optune Lua Active106 137 139
Optune Gio Prescriptions1,608 1,598 1,675
Optune Lua Prescriptions127 143 130

Balance sheet note: Cash, cash equivalents and short-term investments of $1,033.5M at 9/30/25; $561M converts to be retired with cash; second $100M credit facility tranche closed in Q3 .

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Gross MarginFY 2025“Lower 70%” for the year (early-year commentary) Trending to “Mid-70%” for FY 2025 Raised
Adjusted EBITDA Breakeven2027Target breakeven at ~$700–$750M revenue Reaffirmed; sustainable breakeven during 2027 Maintained
R&D Expense Level2025Not explicitly guided“Do not expect R&D to increase materially this year”; reallocating to KEYNOTE D58 / LUNAR-2 New/maintained discipline
Japan Lua ReimbursementLaunch timingN/ANational reimbursement anticipated “in upcoming quarters”; field education underway post-approval New timing detail
Regulatory Timeline – Pancreatic (PANOVA-3)Approval windowPMA submission planned in Q3 PMA accepted; FDA substantive review underway; approval mid-2026 expected Progressed
Regulatory Timeline – METIS (Brain Mets)Filing planPMA submission H2’25 Two modules submitted; final clinical module to be filed by YE25; 9–12 month review thereafter Progressed

No formal quantitative revenue, EPS, or OpEx guidance ranges were provided.

Earnings Call Themes & Trends

TopicQ1 2025 (Prior-2)Q2 2025 (Prior-1)Q3 2025 (Current)Trend
GBM Commercial Momentum4,162 Gio active; 9% YoY growth; solid ex-U.S. growth 4,194 Gio active; strong France/Japan/Germany contribution 4,277 Gio active; France +27%, Japan +8%, Germany +7% YoY; U.S. flat vs Q3’24 Stable to improving ex-U.S.
Lung (Lua) Launch106 Lua active (62 NSCLC) 137 Lua active; recognized Lua revenue $2.4M 139 Lua active; 100 NSCLC patients; behind plan; 84 unique prescribers in Q3 Slower-than-expected U.S./DE; Japan a catalyst
Tariffs / COGSTariff risk disclosed; potential $8–$11M 2025 impact scenarios 74% GM; tariffs a headwind 73% GM; $2.9M Lua array provision; mid-70% FY GM now expected Near-term headwind; improving outlook
Product/TechHFE rollout, app/portal under development HFE rollout continues HFE rollout nearing completion; physician portal, patient app; MaxPoint upgrade pending FDA Improved UX/tools
RegulatoryCE Mark for Lua (EU) PANOVA-3 presented; PMA planned Q3; METIS PMA H2’25 Pancreatic PMA accepted; METIS modules submitted; Lua approved in Japan Advancing to approvals
Reimbursement/Guidelines——Commercial Lua approvals “above expectations”; NCCN lung submission reviewed in July; update in coming months Positive signals; Medicare longer path
Capital/Liquidity$929.1M cash/investments $911.5M cash/investments $1.034B cash/investments; $561M converts to be paid with cash Sufficient runway

Management Commentary

  • “Q3 was a solid quarter with steady commercial execution in glioblastoma, geographic expansion, and material progress for our clinical and product development pipelines… we remain sharply focused on reaching profitability and expanding patient impact.” — CEO Ashley Cordova .
  • “Our GBM business remains solid… We ended the third quarter with 4,277 GBM patients on therapy, our largest patient count to date… Our lung cancer launch has been more difficult than anticipated, and we are learning and adapting our tactics.” — Executive Chairman Bill Doyle .
  • “Gross margin for the third quarter was 73%… [HFE rollout, pre-reimbursement lung, tariffs]… for this year, we see the gross margin get closer to the mid-70%… we remain committed to breaking even sustainably on an adjusted EBITDA basis in 2027.” — CFO Christoph Brackmann .

Q&A Highlights

  • Lung ramp and global launches: Management reiterated U.S./Germany are early and challenging; Japan expected to be “materially different and easier” post national reimbursement due to higher lung prevalence, device familiarity, and ICI-heavy SOC .
  • Reimbursement/Guidelines: Commercial Lua approvals “above expectations”; NCCN submission reviewed July; updates expected in coming months; Medicare will take longer and NCCN is a key input .
  • Prescriber breadth: 84 unique Lua prescribers in Q3; roughly 50/50 mix of new vs returning prescribers, supporting gradual adoption .
  • Profitability bridge: Adjusted EBITDA breakeven targeted in 2027 at ~$700–$750M revenue; influenced by R&D pace and gross margin during launch periods .
  • Capital deployment: $561M converts to be retired with cash; second $100M credit facility tranche closed; liquidity sufficient to bridge to new indications .

Estimates Context

  • Q3 actuals vs S&P Global consensus: Revenue $167.2M vs $158.9M* (beat ~5.2%); EPS $(0.33) vs $(0.420)* (beat ~$0.09); EBITDA $(32.4)M vs $(25.7)M* (miss ~$6.7M), reflecting mix and pre-reimbursement treatments . Consensus values retrieved from S&P Global.*
  • Prior quarters show steadily improving top-line execution vs consensus: Q2 revenue $158.8M vs $154.2M* (beat), EPS $(0.36) vs $(0.389)* (beat); Q1 revenue $155.0M vs $147.0M* (beat), EPS $(0.31) vs $(0.464)* (beat). Consensus values retrieved from S&P Global.*

Values marked with an asterisk (*) are retrieved from S&P Global.

Key Takeaways for Investors

  • Top-line and EPS beats underscore resilient GBM demand and ex-U.S. expansion; EBITDA miss reflects strategic pre-reimbursement lung treatments, HFE rollout, and tariffs—transitory headwinds as reimbursement matures .
  • Japan is the near-term lung catalyst (approval achieved; reimbursement expected in coming quarters) and could inflect adoption given market structure and device receptivity .
  • Regulatory optionality remains robust: pancreatic PMA in review (mid-2026 approval target) and METIS PMA completion by YE25, positioning NVCR for four indications by YE26 .
  • Margin outlook improved (mid-70% FY) vs earlier low-70% expectation, aided by cost progress on HFE arrays; nonetheless, launch sequencing and pre-reimbursement will add variability near term .
  • Liquidity is ample with $1.034B cash/investments and planned retirement of $561M converts; runway supports pipeline execution and disciplined investments .
  • Path to profitability intact: management reiterates adjusted EBITDA breakeven in 2027 at ~$700–$750M revenue, leveraging existing GBM/lung infrastructure to launch pancreatic and brain metastases .
  • For trading: watch for NCCN update (Lua), Japan reimbursement timing, pancreatic PMA review milestones (100-day meeting mid-December noted), and METIS PMA filing completion by YE—each a potential stock catalyst .