10-Q: Xeris Biopharma Narrows Loss, Boosts Revenue in Q2 2025

Xeris Biopharma Holdings, Inc. reported a significant reduction in net loss and strong revenue growth for the second quarter and first half of 2025, driven by increased sales of Recorlev and Gvoke.

Summary

• Total revenue for the six months ended June 30, 2025, increased by 48.4% to $131.7 million, up from $88.7 million in the same period of 2024.
• Net loss for the six months ended June 30, 2025, significantly narrowed to $11.1 million, a 67.2% improvement from a net loss of $34.0 million in the prior year period.
• The company achieved income from operations of $1.4 million for the six months ended June 30, 2025, a substantial improvement from an operating loss of $22.4 million in the same period of 2024.
• Recorlev net revenue surged by 138.0% to $57.0 million for the six months ended June 30, 2025, primarily due to higher prescription volume.
• Gvoke net revenue increased by 21.0% to $44.3 million for the six months ended June 30, 2025, driven by higher volume and favorable net pricing.
• Keveyis net revenue decreased by 12.6% to $22.9 million for the six months ended June 30, 2025, due to lower volume, partially offset by favorable net pricing.
• Cash and cash equivalents stood at $59.3 million as of June 30, 2025, down from $71.6 million at December 31, 2024.
• Net cash used in operating activities improved significantly to $9.8 million for the six months ended June 30, 2025, compared to $30.7 million used in the prior year period.
• The accumulated deficit as of June 30, 2025, was $683.0 million.
• Outstanding common shares as of July 31, 2025, were 161,480,367.

Sentiment

Score: 7

Explanation: The sentiment is moderately positive. The company demonstrated significant financial improvement with a substantial reduction in net loss and a shift to operational income, driven by strong revenue growth from its key commercial products. This indicates effective commercialization and operational management. However, the company still operates at a net loss, has a large accumulated deficit, and explicitly states it expects to continue incurring losses for at least the next 12 months, highlighting ongoing financial challenges and a continued reliance on external financing. The risks associated with capital access and market volatility are also clearly articulated.

Positives

• Total revenue increased by 48.4% for the six months ended June 30, 2025, demonstrating strong top-line growth.
• Net loss significantly decreased by 67.2% for the six months ended June 30, 2025, indicating improved financial efficiency.
• Shifted from an operating loss of $22.4 million to an operating income of $1.4 million for the six months ended June 30, 2025, reflecting better operational performance.
• Recorlev revenue grew by 138.0% due to strong prescription growth, highlighting successful commercialization efforts for this key product.
• Gvoke revenue increased by 21.0%, showing continued market acceptance and growth for the severe hypoglycemia treatment.
• Successfully converted $15.2 million of 2025 Convertible Senior Notes into common stock, reducing near-term debt obligations.
• Introduced new revenue streams, including $1.3 million from the sale of VialDx to American Regent following its approval as a diagnostic aid.

Negatives

• Keveyis net revenue decreased by 12.6% for the six months ended June 30, 2025, primarily due to lower sales volume.
• Cash and cash equivalents decreased from $71.6 million at year-end 2024 to $59.3 million as of June 30, 2025.
• Cost of goods sold as a percentage of total product revenue increased slightly due to higher write-offs of Gvoke components from manufacturing process changes.
• Continued to incur net losses, with an accumulated deficit of $683.0 million as of June 30, 2025.
• Expects to continue incurring net losses for at least the next 12 months due to ongoing marketing, R&D, and public company operating costs, compounded by increased borrowing costs in a high interest rate environment.

Risks

• Ability to acquire additional capital when needed and on acceptable terms is uncertain.
• Market volatility from U.S. trade tariffs, global credit market instability, geopolitical conflicts (Russia-Ukraine, Israel-Hamas), elevated interest rates, inflationary pressures, and tightening lending standards could adversely impact capital access.
• Issuance of equity securities may result in dilution to stockholders.
• Terms of additional debt could impose significant restrictions on operations.
• Failure to raise funds as and when needed could negatively impact financial condition and business strategies, potentially leading to delays or curtailment of operations.
• Reliance on a number of single-source suppliers and manufacturers for products and product candidates, with potential disruptions negatively impacting business.
• Regulatory approval processes for product candidates are subject to uncertainties, including potential impacts of regulatory agency staffing cuts and shifting policy priorities.
• The 2029 Loans may mature earlier on January 15, 2028, if the 2028 Convertible Notes are outstanding and not extended or fully redeemed by then.

Future Outlook

The company expects to continue incurring net losses for at least the next 12 months due to ongoing marketing and selling efforts for commercial products, continued research and development, public company operating costs, and increased borrowing costs in a high interest rate environment. Future capital requirements will depend on the success of commercializing existing products, costs of commercialization activities, timing and outcomes of clinical trials, regulatory actions, and intellectual property costs. There is no assurance that future funding will be available on acceptable terms or that product candidates, if approved, will be profitable.

Management Comments

• Our top priority is maximizing the potential of our three commercial products.
• Our strategy is to build a profitable biopharmaceutical company focused on developing and commercializing therapies for people with chronic endocrine and neurological diseases.
• We believe this will generate a value to all of our stakeholders.
• We expect to continue to incur net losses for at least the next 12 months as we, among other things: continue our marketing and selling efforts related to our commercial products; continue our research and development efforts; continue to operate as a public company; and continue to fund our operations with an increased cost of borrowing due to a high interest rate environment and tighter lending requirements.
• There can be no assurance that such funding may be available to us on acceptable terms, or at all, or that we will be able to commercialize our product candidates, if approved.
• We may not be profitable even if we commercialize any of our product candidates.

Industry Context

Xeris Biopharma operates in the specialty pharmaceutical sector, focusing on rare chronic endocrine and neurological diseases. The strong growth in Recorlev and Gvoke sales indicates successful penetration and demand within their niche markets, despite the overall challenging macroeconomic environment characterized by high interest rates and inflationary pressures. The company's continued investment in its proprietary formulation technologies (XeriSol and XeriJect) and pipeline (XP-8121) aligns with broader industry trends of innovation in drug delivery and addressing unmet medical needs, particularly for conditions requiring convenient injectable formulations.

Comparison to Industry Standards

• The filing does not provide specific comparable companies, projects, or results for direct assessment against global benchmarks. However, the significant reduction in net loss and the shift to operational income suggest an improving financial trajectory relative to its own past performance, which is a positive indicator within the biopharmaceutical industry often characterized by initial losses during development and commercialization phases.

Management Changes

Legal Proceedings

• Not currently subject to any material legal proceedings.
• May be subject to various legal proceedings and claims in the ordinary course of business, but management does not believe any existing, pending, or threatened actions would have a material adverse effect on financial position or results of operations.

Stakeholder Impact

• Shareholders: Potential for future dilution if equity financing is pursued; positive impact from reduced net losses and strong revenue growth; ongoing risk from accumulated deficit and continued expected losses.
• Employees: Continued stock-based compensation and RSU vesting programs; potential for job security given improving operational performance, but also subject to business strategies and funding availability.
• Customers: Continued availability and commercialization of key products (Recorlev, Gvoke, Keveyis) for chronic endocrine and neurological diseases.
• Suppliers/Manufacturers: Continued reliance on single-source suppliers poses a risk of disruption to product supply.
• Creditors: Debt obligations remain significant, with potential for accelerated maturity of 2029 Loans under certain conditions related to 2028 Convertible Notes.

Next Steps

• Continue marketing and selling efforts related to commercial products (Recorlev, Gvoke, Keveyis).
• Plan and initiate a Phase 3 clinical trial for XP-8121 (once-weekly subcutaneous levothyroxine).
• Continue research and development efforts for pipeline candidates.
• Pursue formulation and development partnerships using XeriSol and XeriJect technologies.
• Evaluate the timing and effects of adopting new accounting standards (ASU 2023-09, ASU 2024-03, ASU 2024-04, ASU 2025-01).
• Potentially seek additional public equity and debt financing to meet capital requirements.

Key Dates

Recommendation

While Xeris Biopharma has shown significant improvement in its financial performance, notably reducing its net loss and achieving operational income, it still carries a substantial accumulated deficit and anticipates continued net losses for at least the next 12 months. The strong revenue growth from Recorlev and Gvoke is a positive indicator of commercial success, but the decline in Keveyis revenue and the ongoing need for external financing, coupled with market volatility risks, suggest a cautious approach. The potential for debt maturity acceleration also adds a layer of uncertainty. A 'hold' recommendation reflects the improved operational trajectory balanced against the persistent financial challenges and external market risks, advising investors to monitor the company's progress towards sustained profitability and successful pipeline development before making further commitments.

Keywords

Biopharma, Pharmaceutical, Endocrine diseases, Neurological diseases, Cushing's syndrome, Severe hypoglycemia, Primary Periodic Paralysis, Recorlev, Gvoke, Keveyis, XP-8121, XeriSol, XeriJect, Drug development, Clinical trials, SEC filing, 10-Q, Financial results, Revenue growth, Net loss, Debt, Capital resources