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Introduction & Market Context
OmniAb Inc. (NASDAQ:OABI) presented its third-quarter 2025 financial results on November 4, highlighting strategic initiatives and operational progress despite revenue challenges. The antibody discovery platform company saw its stock rise 2.36% in aftermarket trading to $1.52 per share, suggesting investor optimism about the company's long-term prospects despite current financial headwinds.
The presentation, led by CEO Matt Foehr and CFO Kurt Gustafson, emphasized the company's growing partner base and program pipeline, while acknowledging the revenue decline compared to the same period last year. OmniAb completed a $30 million private placement during the quarter, strengthening its balance sheet as it prepares to launch new technology platforms.
Quarterly Performance Highlights
OmniAb reported Q3 2025 revenue of $2.2 million, a significant decrease from $4.2 million in Q3 2024. The company posted a net loss of $16.5 million, or $0.14 per share, compared to a net loss of $16.4 million, or $0.16 per share, in the prior-year period. The reduced loss per share reflects an increased share count following the private placement.
As shown in the following financial results comparison:
Despite the revenue decline, the company highlighted operational efficiencies, with total costs and operating expenses decreasing to $20.4 million from $23.9 million in Q3 2024. This reduction was primarily driven by lower R&D expenses due to decreased stock-based compensation and headcount, as well as reduced external expenses for small-molecule ion channel programs. G&A expenses also decreased, mainly due to lower legal fees and stock-based compensation.
Partner and Program Growth
A key focus of the presentation was OmniAb's continued expansion of its partner base and program pipeline. The company reported 104 active partners as of September 30, 2025, showing steady growth over recent years and a diversified mix across partner types and geographic regions.
As illustrated in the following chart of active partners:
The company's active programs increased to 399, representing a net addition of 36 programs during the first nine months of 2025. This growth demonstrates continued partner interest in OmniAb's technology platforms despite the revenue challenges.
The following chart shows the progression of active programs:
Particularly noteworthy was the 15% growth in post-discovery stage programs over the last 12 months, reaching 61 programs as of September 30, 2025. These programs represent potential future milestone and royalty revenue, with the company noting total potential milestones of approximately $1.3 billion for post-discovery stage programs.
The breakdown of programs by development stage is shown here:
The company also highlighted progress in its clinical and commercial-stage partner pipeline, with 32 active clinical programs and approved products as of Q3 2025. Based on dialogues with partners, OmniAb expects five new entries into clinical development this year, with two entries as of September 30 and two more in October.
Strategic Initiatives
OmniAb emphasized two key strategic initiatives during the presentation: the xPloration Platform and the upcoming launch of OmniUltra.
The xPloration Platform, which includes instruments, proprietary single-use consumables, annual software subscriptions, and maintenance contracts, is expected to drive efficiencies and be accretive to earnings and cash flow in both the short and long term. The company noted strong demand for instrument demonstrations.
The most significant upcoming initiative is the launch of OmniUltra, scheduled for December at the Antibody Engineering & Therapeutics Conference. OmniUltra is described as the first transgenic chicken that produces antibodies with ultralong CDRH3s, designed to reach binding pockets that are not accessible with other antibodies or modalities.
As shown in the following slide on OmniUltra:
The company positioned OmniUltra as a breakthrough technology that can create novel "Picobodies," which are about one-third the size of nanobodies, with applications in bi-specifics, CAR-T therapies, radiopharmaceutical therapies, and in vivo-generated peptides. OmniAb plans several presentations about OmniUltra at the December conference and will host a webcast for investors on December 15.
Detailed Financial Analysis
OmniAb's balance sheet showed cash and investments of $59.5 million as of September 30, 2025, virtually unchanged from $59.4 million at the end of 2024, reflecting the impact of the $30 million private placement that offset operational cash use.
The company's balance sheet summary is shown here:
Revenue breakdown for Q3 2025 showed declines across multiple categories compared to Q3 2024:
- License and milestone revenue: $0.6 million vs. $1.4 million
- Service revenue: $1.2 million vs. $2.5 million
- Royalty revenue: $0.4 million vs. $0.3 million
- New xPloration revenue: $0.1 million
The company attributed the service revenue decrease primarily to the completion of a small-molecule ion channel program, while license and milestone revenue was lower due to timing of partner achievements.
Forward-Looking Statements
OmniAb provided 2025 financial guidance, projecting full-year revenue of $18-22 million and operating expenses of $82-86 million. The company expects cash use to be lower than in 2024, excluding financings, and anticipates ending the year with cash between $52-56 million.
The guidance summary is presented here:
Management emphasized that despite current revenue challenges, the company's growing partner base and program pipeline, along with the upcoming OmniUltra launch and xPloration platform, position OmniAb for future growth. The effective tax rate is expected to be approximately 0% due to a valuation allowance.
CEO Matt Foehr characterized the OmniUltra launch as "the next evolution of discovery tools" and expressed confidence in the company's momentum in program additions and the positive impact expected from the xPloration platform on earnings and cash flow.
While the presentation highlighted numerous positive developments in partner programs and technology platforms, the current financial results reflect the ongoing challenges OmniAb faces in translating its expanding partner base and program pipeline into near-term revenue growth. Investors appear to be focusing on the company's long-term potential rather than current financial performance, as evidenced by the positive stock reaction following the earnings release.
Full presentation:
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