Sign in

You're signed outSign in or to get full access.

XR

XOMA Royalty Corp (XOMA)·Q1 2025 Earnings Summary

Executive Summary

  • XOMA delivered a materially stronger quarter: total income and revenues rose to $15.9M vs $1.5M a year ago, driving net income of $2.4M and diluted EPS of $0.06, aided by VABYSMO EIR income, Day One/Ipsen MAA milestone ($4.0M), Takeda collaboration payment ($4.0M), and OJEMDA royalties ($1.5M) .
  • Consensus was far too low: Q1 revenue/“total income and revenues” of $15.9M vs $7.1M consensus*; EPS $0.06 vs -$0.27 consensus*, a significant beat that should reset near-term expectations higher.
  • Cash receipts accelerated to $18.0M in Q1 (royalties/commercial payments $13.4M; milestones/fees $4.6M); quarter-end cash and equivalents were $95.0M (incl. $4.8M restricted) after $5.0M deployed on a new Phase 3 asset, $0.5M in buybacks, and $1.4M preferred dividends .
  • Pipeline/catalysts: EMA review of tovorafenib (OJEMDA) underway; Takeda dosed first patient in mezagitamab Phase 3 (triggering a $3.0M milestone in Q2); multiple 2025 readouts/steps (e.g., Rezolute RZ358 topline Dec-2025; Gossamer seralutinib Phase 3 data) support continued royalty momentum .

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

What Went Well and What Went Wrong

  • What Went Well
    • Strong top-line drivers: $15.9M total income and revenues (vs $1.5M prior year), led by VABYSMO EIR income, $4.0M Day One/Ipsen MAA milestone, $4.0M Takeda collaboration payment, and $1.5M OJEMDA royalties .
    • Cash flow momentum: $18.0M cash receipts in Q1 (royalties/commercial $13.4M; milestones/fees $4.6M) and share repurchase of 25,828 shares for ~$0.5M reflecting capital discipline .
    • Positive tone on sustainability: “With accelerating royalty receipts and a robust pipeline, we believe a path to sustained cashflow generation is tangible,” CEO Owen Hughes .
  • What Went Wrong
    • Other income headwind: Other income/expense swung to a small net expense (-$0.1M) vs +$2.0M prior year, due to lower equity values and lower investment income as balances and market rates declined .
    • Ongoing interest burden: Q1 interest expense remained high at $3.5M tied to the Blue Owl loan (vs $3.6M in Q1’24) .
    • R&D uptick (transitory): R&D rose to $1.3M vs $33K prior year, primarily pass-through licensing fees related to Takeda’s Phase 3 milestone and KIN-3248 clinical wind-down costs .

Financial Results

Summary financials vs prior periods

MetricQ3 2024Q4 2024Q1 2025
Total income and revenues ($USD Millions)$7.197 $8.7 $15.912
Net income (loss) ($USD Millions)$(17.243) $(4.0) $2.367
Basic EPS ($)$(1.59) N/A$0.06

Notes: Company reports “Total income and revenues,” which includes income from purchased receivables and contract revenue.

Q1 2025 vs Wall Street consensus (S&P Global)

MetricConsensusActualSurprise
Revenue / Total income and revenues ($USD Millions)$7.065*$15.912 +$8.847
EPS (Primary) ($)$(0.2725)*$0.06 +$0.3325

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

Expenses and cash metrics (trend)

KPIQ3 2024Q4 2024Q1 2025
R&D expense ($USD Millions)$0.817 $0.9 $1.293
G&A expense ($USD Millions)$8.020 $7.0 $8.146
Interest expense ($USD Millions)$3.493 $3.4 $3.467
Cash receipts ($USD Millions)$9.9 $4.0 $18.0
Cash & equivalents at period-end ($USD Millions)$146.8 (incl. $4.8M restricted) $106.4 (incl. $4.8M restricted) $95.0 (incl. $4.8M restricted)
Share repurchases ($USD Millions)——$0.5
Preferred dividends paid ($USD Millions)$1.4 $5.5 FY24 $1.4

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Revenue / EPSFY 2025Not providedNot providedMaintained: no quantitative guidance provided
OpEx trajectory2H 2025—Management expects R&D and G&A to normalize in 2H25 (Q4 commentary) New qualitative color
Preferred dividendsQ2 2025 (paid ~Apr 15)—Series A: $0.53906/sh; Series B depositary share: $0.52344/sh Declared
BuybacksOngoing—Repurchased 25,828 shares (~$0.5M) in Q1 Activity update

Earnings Call Themes & Trends

Note: We did not find a Q1 2025 earnings call transcript; themes reflect management’s press release commentary and prior quarter communications.

TopicPrevious Mentions (Q-2 and Q-1)Current Period (Q1 2025)Trend
Royalty receipts / Cash flowQ3’24: Cash receipts $9.9M; interest expense elevated; Agenus impairment recorded . Q4’24: “Line of sight” to being cash flow positive consistently from royalties; cash receipts $4.0M in Q4 .Q1 cash receipts $18.0M ($13.4M royalties/commercial; $4.6M milestones/fees); reiteration of path to sustained cashflow .Improving cash generation
Pipeline/regulatory catalystsQ3’24: MIPLYFFA FDA approval; RZ358 U.S. Phase 3 cleared . Q4’24: 2025 readouts (Rezolute, Gossamer) highlighted .EMA MAA accepted for tovorafenib; Takeda initiated mezagitamab Phase 3; $3.0M milestone expected in Q2 .Building catalysts
Expense normalizationQ4’24: Management expects R&D and G&A to normalize in 2H25 as acquisition-related costs fade .Q1: G&A $8.1M (stock comp down $0.9M YoY); R&D up due to pass-through fees and KIN-3248 wind-down .Normalization underway (mixed quarterly noise)
Credit losses / portfolio qualityQ3’24: $14.0M non-cash impairment (Agenus) . Q4’24: FY24 credit losses $30.9M (Agenus, Aronora, Talphera) .No new credit loss disclosures in Q1 release; focus shifted to receipts and milestones .Stabilizing
Capital allocationQ3’24: Twist monetization; portfolio expansion . Q4’24: Two company acquisitions; $65M deployed in 2024; >$100M cash YE .$5M deployed to Castle Creek D-Fi royalty; $0.5M buybacks; continued dividend payments .Balanced deployment

Management Commentary

  • CEO Owen Hughes: “With accelerating royalty receipts and a robust pipeline, we believe a path to sustained cashflow generation is tangible.”
  • CFO Tom Burns: “We received $18 million in cash, $13.4 million from our partners’ commercial sales and $4.6 million from milestones and fees…we deployed $0.5 million to repurchase 25,828 shares of our common stock.”

Q&A Highlights

  • No Q1 2025 earnings call transcript was available; no Q&A themes to report from a call. All commentary sourced from the press release and 8‑K filing .

Estimates Context

  • XOMA materially beat Q1 consensus: revenue/“total income and revenues” $15.9M vs $7.1M consensus* and EPS $0.06 vs -$0.27 consensus*, driven by EIR income on VABYSMO, Day One/Ipsen MAA milestone, Takeda collaboration payment, and OJEMDA royalties .
  • Given the magnitude and composition of the beat, estimates likely need to incorporate continuing EIR contributions and upcoming milestone cadence (e.g., $3.0M net milestone from Takeda triggered in Q2) .

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

Key Takeaways for Investors

  • Q1 upside was driven by diversified cash flows: EIR income (VABYSMO), regulatory milestones (Day One/Ipsen), collaboration payments (Takeda), and initial OJEMDA royalties—supporting the royalty-aggregator model’s resilience .
  • Cash receipts accelerated to $18.0M, and management reiterated a tangible path to sustained cash flow generation; this should be supportive for sentiment and near-term estimate revisions .
  • Interest expense (~$3.5M/quarter) remains a drag tied to the Blue Owl loan; monitoring deleveraging or refinancing options is prudent .
  • Expense normalization into 2H25 should aid operating leverage as acquisition-related costs subside, though quarterly noise (e.g., pass-through fees) can persist .
  • Catalysts: EMA decision on tovorafenib; RZ358 Phase 3 topline (Dec-2025); Gossamer seralutinib Phase 3 readout; and Takeda’s mezagitamab Phase 3 progress—each could add to royalty momentum .
  • Capital allocation remains balanced: continued portfolio build (Castle Creek D‑Fi), modest buybacks ($0.5M), and steady preferred dividends; cash of $95.0M provides flexibility .
  • Near-term trading setup: substantial beat vs consensus and accelerating receipts provide a positive narrative; watch upcoming milestones/regulatory events for incremental inflections.

Sources

  • Q1 2025 earnings 8‑K and press release (Ex. 99.1): totals, expenses, cash, milestones, quotes ; press release mirror .
  • Prior quarters: Q4 2024 press release and 8‑K (trend, expenses, credit losses, cash) . Q3 2024 press release and 8‑K (trend, expenses, impairment) .

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