Fubotv earnings beat by $0.10, revenue topped estimates
Heron Therapeutics reported its Q2 2025 earnings, revealing a miss on both EPS and revenue forecasts. The company posted an EPS of -0.02 USD, below the expected -0.01 USD, and reported revenues of 37.2 million USD, missing the forecasted 38.08 million USD. The stock reacted sharply, falling 21.2% in pre-market trading to 1.45 USD, reflecting investor concerns over the earnings miss. According to InvestingPro analysis, the company appears undervalued at current levels, with a "GOOD" overall Financial Health score despite recent challenges.
Key Takeaways
- Heron Therapeutics missed both EPS and revenue forecasts for Q2 2025.
- The company reported a transition to net income year-to-date, despite the quarterly miss.
- Stock price dropped significantly by 21.2% in pre-market trading.
- Strong demand growth for key products Zenerlef and Oponvi was noted.
- Guidance for future quarters remains cautious.
Company Performance
Heron Therapeutics demonstrated mixed performance in Q2 2025. Despite missing earnings expectations, the company has shown growth in product demand and profitability improvements. However, the earnings miss has overshadowed these achievements, as evidenced by the significant pre-market stock price decline.
Financial Highlights
- Revenue: 37.2 million USD, below the 38.08 million USD forecast.
- Earnings per share: -0.02 USD, missing the -0.01 USD forecast.
- Gross profit margin increased to 73.5% from 70.8% in the previous quarter.
- Year-to-date net income reached 300,000 USD.
Earnings vs. Forecast
Heron Therapeutics’ actual EPS of -0.02 USD was below the forecasted -0.01 USD, resulting in a 100% negative surprise. Revenue also fell short of expectations, coming in at 37.2 million USD against a forecast of 38.08 million USD, marking a -2.31% surprise.
Market Reaction
The stock price of Heron Therapeutics fell sharply by 21.2% in pre-market trading, settling at 1.45 USD. This decline highlights investor disappointment following the earnings miss. The stock had previously closed at 1.84 USD, and the drop places it closer to its 52-week low of 1.04 USD, indicating a challenging market response. With average daily trading volume of 1.28 million shares and a strong "Buy" consensus from analysts, the market reaction may present opportunities for investors. Get deeper insights and access to comprehensive valuation models with InvestingPro.
Outlook & Guidance
Heron Therapeutics maintained its net revenue guidance for the year at 153 to 163 million USD but revised its adjusted EBITDA guidance to 9 to 13 million USD. The company anticipates inventory normalization in Q3 and expects increased reimbursement adoption, which could positively impact future earnings.
Executive Commentary
CEO Craig Collard remarked, "We’re executing on our strategy, strengthening our financial foundation, and positioning Heron for long-term growth." COO Mark Hensley added, "We optimized our sales force and created dedicated teams for Zynralife and Opondi." These comments underscore the company’s strategic focus despite the current earnings challenges.
Risks and Challenges
- Continued earnings misses could erode investor confidence.
- Market competition remains intense, particularly in the oncology sector.
- Economic pressures and reimbursement changes could impact future profitability.
- Inventory adjustments and sales force restructuring may face execution risks.
- The significant stock price drop could affect market perception and future capital raising efforts.
Q&A
During the earnings call, analysts questioned the impact of the Zenerlef 400mg transition and the benefits of J-code reimbursement. The company addressed inventory adjustments for Oponvi and explained the rationale behind sales force restructuring, aiming to alleviate investor concerns.
Full transcript - Heron Therapeuti (HRTX) Q2 2025:
Conference Operator: Thank you for standing by and welcome to the Huron Therapeutics Second Quarter twenty twenty five Earnings Conference Call. At this time, all participants are in a listen only mode. After the speakers’ presentation, there will be a question and answer session. To ask a question during this session, you’ll need to press 11 on your telephone. If your question has been answered and you’d like to remove yourself from the queue, simply press 11 again.
As a reminder, today’s program is being recorded. And now I’d like to introduce your host for today’s program, Melissa Jarrell, Executive Director of Legal at Huron. Please go ahead.
Melissa Jarrell, Executive Director of Legal, Heron Therapeutics: Thank you, operator, and hello, everyone. Thank you for joining us on the Heron Therapeutics conference call today to discuss the company’s financial results for the quarter ended 06/30/2025. With me today from Heron are Craig Collard, Chief Executive Officer Ira Duarte, Executive Vice President, Chief Financial Officer Bill Forbes, Executive Vice President, Chief Development Officer Mark Hensley, Chief Operating Officer and Kevin Warner, Senior Vice President, Medical Affairs Strategy and Engagement. For those of you participating via conference call, slides are made available via webcast and can also be accessed via the Investor Relations page of our website following the conclusion of today’s call. Before we begin, let me quickly remind you that during the course of this conference call, the company will make forward looking statements.
We caution you that any statement that is not a statement of historical fact is a forward looking statement. This includes remarks about the company’s projections, expectations, plans, beliefs, and future performance, all of which constitute forward looking statements for the purposes of the Safe Harbor provision under the Private Securities Litigation Reform Act of 1995. These statements are based on judgment and analysis as of the date of this conference call and are subject to numerous important risks and uncertainties that could cause actual results to differ materially from those described in the forward looking statements. The risks and uncertainties associated with the forward looking statements made in this conference call and webcast are described in the Safe Harbor statement in today’s press release and in Heron’s public periodic filings with the SEC. Except as required by law, Heron assumes no obligation to update these forward looking statements to reflect future events or actual outcomes and does not intend to do so.
And with that, I would now like to turn the call over to Craig Collard, Chief Executive Officer of Heron.
Craig Collard, Chief Executive Officer, Heron Therapeutics: Thanks, Melissa. Hello, everyone, and welcome to Heron Therapeutics second quarter twenty twenty five earnings call. Today, we’re thrilled to share results and progress for the second quarter and first half twenty twenty five. It’s been an incredibly active and transformative period for Team Heron. And I want to begin by recognizing the tremendous effort and dedication our team has demonstrated.
One of the most significant milestones this quarter was the successful completion of our new financing. This was a complex and critical undertaking, and I’m proud to say our team executed it with precision and focus as usual. The financing strengthens our balance sheet, enhances our financial flexibility, and positions us to accelerate our strategic initiatives with confidence. This achievement reflects not only our commitment to operational excellence, but also the strong belief our partners and investors have inherent long term vision. With this new capital in place, we’re better equipped to drive innovation, expand our commercial initiatives, and continue delivering value to both patients and shareholders.
Beyond the successful financing, team Heron delivered strong operational and financial performance in the second quarter. We generated total net revenues of $37,200,000 for the quarter and $76,100,000 for the 2025. This performance resulted in adjusted EBITDA of 7,900,000 for the first half of the year, reflecting our continued focus on disciplined execution and operational efficiency. Importantly, we’re seeing consistent product demand growth with Zenerlef and Aponvi, which has outpaced net revenue growth over the past two quarters. This is a key indicator of the underlying strength of our business and the growing adoption of our products.
Mark will provide more detail on this dynamic later in our prepared remarks. Another major milestone this quarter was the transition from a C code to a permanent J code for Xenralev that will become effective October 1. This is a significant win for Heron and for the providers who rely on Zenerlef in their practice. The J code will streamline reimbursement processes and reduce administrative burden, especially as the no pain act continues to gain traction. We believe this change will improve the access and coverage across both government and commercial payers, ultimately supporting broader adoption and better patient outcomes.
Taken together, these achievements underscore the momentum we’re building across the organization. We’re executing on our strategy, strengthening our financial foundation, and positioning Heron for long term growth. I’d now like to turn the call over to Mark Hensley, our Chief Operating Officer to cover product performance and many of the new initiatives we believe will be catalysts for future growth. Go ahead,
Mark Hensley, Chief Operating Officer, Heron Therapeutics: Thanks, Craig. Q2 was a transitional quarter for Heron as we implemented several key commercial changes designed to strengthen execution in the second half of the year and beyond. Combined net revenues from OPONVI and ZINRALF totaled $10,700,000 for the second quarter and $20,900,000 year to date. This reflects strong year over year growth of 55.5% for the quarter and 70.5 for the 2025 compared to the same periods in 2024. Across the acute care franchise, demand growth was encouraging, with unit growth across both Zenerlef and Aponvi.
While reported revenue was relatively flat quarter over quarter, this masks meaningful progress and foundational work that will support growth in the second half of the year. Let me walk you through the drivers in more detail, beginning with Zenerlef. Zenerlef adoption continues to accelerate, with growth in average daily units and total ordering accounts now more than 700 through the month of June. Zenerlef demand units grew 6.3% over Q1, signaling continued momentum in provider adoption. However, Q2 revenue was impacted by a transient inventory drawdown at our wholesalers, primarily related to the transition to the four hundred mg band.
This type of wholesaler inventory swing is common in new product transitions, and we estimate it reduced net sales by approximately $400,000 in the quarter. Importantly, this drawdown occurred while end user demand continued to increase, and we expect wholesaler ordering patterns to normalize in Q3. Operationally, we focused the Zenerleft team on targeted pull through and accounts, where we already have formulary access. This alignment ensures our reps are focused on converting approved access into actual utilization. In addition, we made several enhancements to drive long term growth.
We launched a significantly enhanced per unit compensation program with CrossLink. Beginning in July, CrossLink reps were allowed to nominate up to four accounts per territory with little or no historical Xinterleft use, where they believe they can make an immediate impact. Many of these accounts already had formulary access and the enhanced incentives are in place through the 2025. In addition, we stood up a new postoperative clinical educator team. These three specialists provide targeted onboarding and support in high volume accounts, improving adoption efficiency while allowing reps to focus on growth.
And importantly, we received a permanent J Code for Zenerlef, effective October 1. While not a near term growth catalyst on its own, the J Code streamlines reimbursement and should improve billing clarity. Taken together, these initiatives represent a reoriented and focused Zeneralev commercial engine well positioned for acceleration in the second half of the year. Turning to Oponvi, we continue to see strong trends, nearing the 1,000 average daily unit mark for the month of June. While ex factory units grew 11%, demand units grew 19%, net revenue grew 9% over Q1.
The difference between demand and revenue reflects inventory normalization at the wholesaler level and a modest impact from standard 340B discounts as larger hospital systems came online in the quarter. To support continued growth, we launched a dedicated Upon B sales team on July 1, consisting of six reps supported by our national account team. This team was created without incremental headcount costs, thanks to strategic consolidation of underperforming territories. We believe this targeted investment will unlock further hospital account conversion going forward. The oncology franchise continues to outperform our expectations.
With combined net revenues from Symvanti and Sostall reaching $26,500,000 for the quarter and $55,100,000 year to date. We have maintained market share in a highly competitive environment, and we believe these products will continue to deliver consistent performance throughout 2025. We are extremely pleased with the results of our oncology supportive care franchise, and we are actively exploring creative strategies to drive continued growth in this market. In summary, Q2 was about restructuring and refocusing our commercial platform. We optimized our sales force and created dedicated teams for Zynralife and Opondi.
We aligned with Crosslink around enhanced pull through and target accounts. We supported high volume institutions with dedicated clinical educators. And we made real progress in demand growth even amid temporary revenue headwinds. With these changes in place, we believe Heron is well positioned to drive accelerating growth in the 2025 and beyond. Thanks, and I’ll now turn it back to you, Craig.
Craig Collard, Chief Executive Officer, Heron Therapeutics: Thanks, Mark. Now moving to our financial performance. Our product gross profit for the three months ended 06/30/2025 was $27,300,000 or 73.5%, which increased from 70.8% for the same period in 2024. For the six months ended 06/30/2025, our product gross profit was $57,800,000 or 75.9%, which increased from 73.2% for the same period in 2024. This was due to an increase in units sold at a higher cost per unit sold than in 2024 due to the supplier mix, offset by lower inventory reserves and write offs.
SG and A expenses for three and six months ended 06/30/2025 was $26,000,000 and $51,100,000 respectively, compared to twenty seven point five million dollars and $53,900,000 respectively for the same periods in 2024. For the three months ended 06/30/2025, the decrease in SG and A expense is primarily attributed to a decrease in personnel and related expenses of 1,800,000 due to terminations and one time stock expense in 2024. For the six months ended 06/30/2025, the decrease in SG and A expense is primarily attributed to a decrease in personnel and related expenses of $3,500,000 due to the terminations and one time stock expense in 2024. These decreases were offset by an increase in marketing cost of $600,000 primarily related to Zeneralev. Research and development expenses were $2,900,000 and $5,200,000 respectively for the three and six months ended 06/30/2025, compared to $4,400,000 and $9,000,000 respectively for the comparable periods in 2024.
The decrease in research and development expense for the three months ended 06/30/2025 is primarily due to $1,200,000 more of write offs of property and equipment in 2024 than in 2025 and a decrease in personnel and related expenses of $300,000 due to terminations. The decrease in research and development expense for the six months ended 06/30/2025 is primarily due to the $1,200,000 more of write off of property and equipment in 2024 than in 2025 and a decrease in personnel and related expenses of $2,000,000 due to terminations. For the three months ended 06/30/2025, we incurred a net loss of $2,400,000 compared to a net loss of $9,200,000 for the same period in 2024. For the six months ended 06/30/2025, we earned net income of $300,000 compared to a net loss of $12,400,000 for the same period in 2024. Cash and short term investments at 06/30/2025 was $40,600,000 If we had excluded depreciation and stock based compensation, our adjusted EBITDA results would have been a positive $1,800,000 of operating income for the three months ended 06/30/2025 compared to a loss of $1,200,000 for the three months ended 06/30/2024.
For the six months ended 06/30/2025, our adjusted EBITDA is $7,900,000 of operating income compared to a loss of 1,900,000.0 for the same period in 2024. On 08/08/2025, we entered into a refinancing consisting of four concurrent transactions as follows. Firstly, a new credit facility with Hercules Capital that provides for up to $150,000,000 in aggregate principal, including 110,000,000 funded at closing and an additional $40,000,000 available in future tranches subject to milestone achievement. Secondly, the issuance and sale of $35,000,000 of new 5% senior convertible notes due in 2031 to Rubrik Capital. Thirdly, a placement of common stock in Series A preferred stock with certain investors for aggregate gross proceeds of approximately $28,000,000 And lastly, an exchange transaction with our current convertible note holder involving the repayment of the majority of our outstanding 1.5% senior convertible notes due in May 2026 in cash and a conversion of a portion of the remaining notes into shares of common stock.
The outstanding $150,000,000 of aggregate principal amount of our existing 1.5% senior convertible notes due 2026 and the $25,700,000 of aggregate principal amount outstanding under our prior Hercules working capital facility will be fully repaid and extinguished upon the closing of these transactions, which is expected to occur on 08/12/2025. Now moving to 2025 financial guidance. Based on the continued performance of our business, we are maintaining our previously given net revenue guidance of $153,000,000 to $163,000,000 and we are revising our previously given guidance of adjusted EBITDA of $4,000,000 to $12,000,000 to a range of $9,000,000 to $13,000,000 We would now like to open the call for any questions.
Conference Operator: Certainly. And our first question for today comes from the line of Clara Dong from Jefferies. Your question, please.
Clara Dong, Analyst, Jefferies: Hi. Good morning. So one question on ZEROLOV. So can you give us more detail on the VEN four hundred milligram transition and how much of Q2 revenue was impacted? And maybe how much of the impact was on the timing?
And then whether you expect it to fully normalize in the second half with VAN transition completing in the third quarter? And I have a follow-up. Thank you.
Company Representative, Heron Therapeutics: Question. So the VAN400 milligram transition began at the end of Q4, so really late December. Most of Q1 we were in transition and by Q2 we no longer were selling any of the VVS, But the inventory buildup at the end of Q4 and into Q1 didn’t normalize until Q2. And so we do expect the Q3 normalization of inventory to be complete as of July 1.
Clara Dong, Analyst, Jefferies: Got it. The J code for Zero Life, maybe give us some comments on how this plays a player role in reimbursement along with no paying back and your thoughts on the impact on the adoption moving forward?
Craig Collard, Chief Executive Officer, Heron Therapeutics: Yeah. Hi, Claire. This is Craig. No, look, we were excited to get the J code. What we’ve sort of seen over time as we had passed through reimbursement with the C code, it’s not that that’s not recognized, but the J code is much more sort of universe universally recognized, if you will.
And certainly with commercial payers, there are a lot more sort of used to dealing with that. So I think with no pain, what you’re going to see over time, and we’re beginning to see this with certain payers, is that they’re going to pick up what CMS or Medicare is doing. And as that happens more, we think, again, having a J code is just going to make it more conducive for reimbursement and make it simpler. We don’t necessarily see an impact immediately, but as this plays out and commercial payers come on board and reimbursement gets more synonymous with, know, basically these products being paid for outside of the surgical bundle, I think you’re going to see a shift that was J code really does help us longer term.
Clara Dong, Analyst, Jefferies: Thank you. That was helpful and congrats on all the progress.
Craig Collard, Chief Executive Officer, Heron Therapeutics: Thanks, Claire.
Conference Operator: Thank you. And our next question comes from the line of Brendan Folkes from H. C. Wainwright. Your question please.
Brendan Folkes, Analyst, H.C. Wainwright: Hi, thanks for taking my questions. Maybe just two from me. I apologize if you covered some of this, just hopping between calls here. But maybe just on the Zynralife Salesforce reorganization, can you just elaborate sort of what drove that and what that does to the cross link partnership? And then secondly, on a PONVI, looked like demand grew 19%, revenue 9%.
Is that just inventory movement? Or are you taking a different approach to pricing in terms of getting in volume on that product? Thank you.
Company Representative, Heron Therapeutics: Hey, Brandon, thanks for the question. So on the Zinterleft sales force, prior to July 1, we had one team that was essentially comped fifty-fifty on the PONVY and Zinterleft. But as we evaluated the team, we think that the profiles of those two teams should be different in terms of their skill set, where a ZINRALF rep is primarily focused in the OR on surgeons, and a PONVY rep is typically your traditional hospital sales rep. And so for that reason, we’ve divided the teams up. The Zenerleft team stayed relatively similar to what it was.
The UPONV team is small. It’s only six IBMs today or institutional business managers today, but we think the team that we put in place there will have a meaningful impact on a PONV long term. As it relates to Crosslink, we’ve had a really nice agreement in place with them. We started that in 2024. We’ve built out a really nice network across the country.
But what we wanted to do was really engage them focused on specific accounts. And so we’ve allowed them to pick four accounts from a list that we provided, primarily accounts where we already have formulary access. And we’ve significantly enhanced the incentive around those accounts on a per unit basis. And so we’ve aligned that with our current Zeneralift sales team’s targets as well, and so we feel like we’re much better targeted in terms of overlap between the two teams, and we have the incentives in place right now to really drive momentum on the back half of the year. As it relates to the Aponvy sales, it’s primarily a wholesaler inventory adjustments as we pared down inventory coming out of Q4 and Q1.
There is a bit of gross to net in there where we had two or three large academic centers come online in the quarter, and there was some kind of skew in the amount of 340B that they were acquiring, but we do expect that to normalize over the second half as more and more accounts are added.
Brendan Folkes, Analyst, H.C. Wainwright: Great. Thanks very much for taking my questions.
Craig Collard, Chief Executive Officer, Heron Therapeutics: You bet. Thanks, Brad.
Conference Operator: Thank you. And our next question comes from the line of Serge Belanger from Needham. Your question please. Hi, good morning. Thanks for taking the questions.
I guess a follow-up regarding the Salesforce changes. Is this just a refocusing on the two specific products or is there an expansion in numbers that comes along with restructuring? And then secondly, regarding ZINRALF, I believe no pain for Huron came into effect in April. So just curious if you’ve noticed any changes in usage or uptake of ZINRALF during that transition from your original path to reimbursement to no pain. Oh, maybe one last one for Ira.
Just the new overall share count after the various transactions this morning? Thanks.
Company Representative, Heron Therapeutics: So I’ll take the restructuring question. Craig can take the no pain, and then we’ll turn it over to Ira on the share count. So in terms of the restructuring, we don’t foresee an expansion in the teams beyond today over the short term. You see is just a more dedicated focus by one single Zenerleft team, where before, they were also trying their best to also have enough time to sell upon thee. And so in terms of the profile of those reps, we see them as slightly different in the strategy itself.
And so we broke them apart. We hired traditional hospital reps to focus on a POMV. So that in itself is a bit of an expansion, but we were able to do all this in a way that didn’t meaningfully add to costs over the over the short term.
Craig Collard, Chief Executive Officer, Heron Therapeutics: Serge, I would just add to that. I think that, you know, if you think of the country and what we’ve done here is with Zenerlef and the overlap with Crosslink, think of sort of pods, if you will, or postage stamps around the country. With us cleaning up the balance sheet and some of the extra money we’ve raised, what we think, and we’re already beginning to see this a little bit with Crosslink really being a lot more engaged based on some of the incentives we’re doing is that we’re going to see pockets where this really begins to take off. And so as far as expansion and that type of thing, if we do see that, obviously, we’re going to add more support to those areas. And so that’s where we could expand possibly in the future.
But again, this is kind of a wait and see. And instead of just sort of blanketly, you know, sort of throwing out, you know, monies and and putting a 100 reps out there and what have you, we’d like to do this sort of systematically and and a little bit more efficiently. I think we’ve shown, you know, at least over the last two years, we’ve tried to be, you know, very, I guess, consistent in how we manage the financial, you know, picture of the company and so forth. We want to continue to do that going forward. And if you think about, you know, to your point about no pain and how this plays out, we haven’t seen an immediate impact yet.
What we are seeing is that the conversations at pharmacy are just a little different than they have traditionally been in the past. And what I mean by that, generally, you know, a representative walks in and it’s, you know, branded product, you know, park in the last part, you know, last parking space in the parking lot type of thing. But I think what we’re beginning to see now is that it’s a little more more open because everyone’s talking reimbursement, and they realize that these products, you know, can actually be a profit versus a cost. And so I think, like I said before about, you know, commercial payers coming on board, I think you’re going see a real shift over the next, you know, year or so where commercial payers come on board, everyone systematically sort of accepts this type of thing as far as reimbursement and looks at it a little bit differently than maybe it had in the past. And so again, you throw that in, van, the crosslink incentive, the things we’re doing here from a structure standpoint, we just feel like we have a lot of tailwinds that are pushing us in the right direction.
Anir, I’ll let you take the last piece of that.
Ira Duarte, Executive Vice President, Chief Financial Officer, Heron Therapeutics: Yep. The pro form a common share is about 183,000,000 shares. And pro form a shares, the convert, would be about $2.00 8,000,000.
Conference Operator: Thank you. Thank you. Our next question comes from the line of Karl Burns from Northland Capital Markets. Your question,
Craig Collard, Chief Executive Officer, Heron Therapeutics: please. Thanks for the question. Congratulations on the progress. Was just wondering if you could disclose what the rate is on the senior credit facility with Hercules. And then also, with respect to how much cash net of expenses, etcetera, when everything closes will be added to the balance sheet, excluding the $40,000,000 additional tranches?
Thanks.
Ira Duarte, Executive Vice President, Chief Financial Officer, Heron Therapeutics: Yeah. The overall rate, Carl, is, a little bit north of 10%, and the funds to the balance sheet is probably about 11 to 12,000,000 after all expenses.
Craig Collard, Chief Executive Officer, Heron Therapeutics: Great. Thanks.
Conference Operator: Thank you. This does conclude the question and answer session of today’s program. I’d like to hand the program back to Craig Cullen for any further remarks.
Craig Collard, Chief Executive Officer, Heron Therapeutics: No, thanks everyone for the questions today. I know this was short notice. We do appreciate everyone jumping on and we’ll talk to you next quarter.
Conference Operator: Thank you, ladies and gentlemen, for your participation in today’s conference. This does conclude the program. You may now disconnect. Good day.
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