Summers Value Partners, an investment management company, released its third-quarter 2025 investor letter. A copy of the letter can be downloaded here. The Summers Value Fund LP returned a net return of 20.4% net in Q3 2025, surpassing the 12.4% return of the Russell 2000 Index ETF (IWM) and the 12.5% return for the Russell 2000 Value Index ETF (IWN). Year-to-date, the fund is up 4.9% net compared to 10.3% and 8.9% returns for the indexes, respectively. In addition, you can check the fund’s top 5 holdings ...

For the quarter ended September 2025, Journey Medical Corporation (DERM) reported revenue of $17.63 million, up 20.5% over the same period last year. EPS came in at -$0.09, compared to -$0.12 in the year-ago quarter.The reported revenue represents a surprise of -0.39% over the Zacks Consensus Estimate of $17.7 million. With the consensus EPS estimate being -$0.08, the EPS surprise was -12.5%.While investors scrutinize revenue and earnings changes year-over-year and how they compare with Wall Street expectat ...

Core Insights - Journey Medical Corporation reported a quarterly loss of $0.09 per share, slightly worse than the Zacks Consensus Estimate of a loss of $0.08, but an improvement from a loss of $0.12 per share a year ago, indicating a -12.50% earnings surprise [1] - The company generated revenues of $17.63 million for the quarter ended September 2025, missing the Zacks Consensus Estimate by 0.39%, but showing growth from $14.63 million in the same quarter last year [2] - Journey Medical shares have increased approximately 131.5% year-to-date, significantly outperforming the S&P 500's gain of 16.4% [3] Earnings Outlook - The current consensus EPS estimate for the upcoming quarter is -$0.03 on revenues of $19.5 million, and for the current fiscal year, it is -$0.42 on revenues of $68.15 million [7] - The estimate revisions trend for Journey Medical was mixed ahead of the earnings release, resulting in a Zacks Rank 3 (Hold), suggesting the stock is expected to perform in line with the market in the near future [6] Industry Context - The Medical - Drugs industry, to which Journey Medical belongs, is currently ranked in the top 32% of over 250 Zacks industries, indicating a favorable outlook compared to the bottom 50% [8] - Empirical research indicates a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can be tracked by investors [5]

Financial Data and Key Metrics Changes - Journey Medical reported total revenues of $17.6 million for Q3 2025, a 21% increase from $14.9 million in Q3 2024, driven by the successful launch of Amrosi [5][13] - Gross margin decreased to 67.4% in Q3 2025 from 69.4% in Q3 2024, but showed steady improvement from 63.5% in Q1 2025 and 67.1% in Q2 2025 [13][14] - The company reported a GAAP net loss of $2.3 million, or $0.09 per share, compared to a loss of $2.4 million, or $0.12 per share, in the same period last year [15] - EBITDA improved from a loss of $1 million in Q3 2024 to a loss of $500,000 in Q3 2025, with adjusted EBITDA reaching $1.7 million compared to $300,000 in the prior year [15][16] Business Line Data and Key Metrics Changes - Emrosi contributed $4.9 million to revenue in Q3 2025, a 75% increase from Q2 2025, while legacy products like Qbrexza, Accutane, and Zilxi saw a 16% year-over-year decline due to generic competition [5][6] - Total prescriptions for Emrosi grew by approximately 146% from Q2 to Q3 2025, with 18,198 prescriptions in Q3 compared to 7,394 in Q2 [6][17] - The number of unique prescribers for Amrosi increased by approximately 50% to over 2,700, indicating strong initial adoption [9][11] Market Data and Key Metrics Changes - Over $100 million of the $187 million commercial lives currently have access to Amrosi, with successful contracting with two of the three largest GPOs [7][8] - Physician feedback on Amrosi has been positive, with prescribers noting early efficacy and strong refill rates, indicating a favorable reception in the market [8][10] Company Strategy and Development Direction - The company aims to establish Amrosi as the standard of care for rosacea treatment, with expectations of peak annual net sales exceeding $200 million in the U.S. and $300 million globally [17][18] - Journey Medical is focused on disciplined expense management and margin expansion while scaling Amrosi's commercial footprint [16][18] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving sustainable EBITDA positivity in Q4 2025, highlighting the transformational potential of 2025 for the company [18] - The company anticipates that as drug coverage increases, reliance on the copay assistance program will decrease, with significant gains expected in 2026 [21][22] Other Important Information - The company is actively participating in dermatology medical conferences to build awareness and momentum for Amrosi [9][11] - The launch of Amrosi is expected to create a snowball effect in prescription growth as more physicians gain confidence in the product [25][26] Q&A Session Summary Question: Usage of patient assistance program for Amrosi - Management noted that the copay assistance program will see reduced reliance as reimbursement improves, with significant gains expected in 2026 [21][22] Question: Focus on breadth vs. depth of prescribers - The company is focusing on both breadth and depth, with efforts to convert new prescribers into consistent writers while expanding the prescriber base [24][25] Question: Revenue per script fluctuations - Management acknowledged variability in gross to net revenue and indicated that improvements are expected as more GPOs are contracted [29][30] Question: Launch curve expectations - Management expressed optimism about a consistently growing and potentially accelerating launch curve based on current performance [32] Question: Accutane's performance amidst generic competition - Management indicated that Accutane appears stable, with a recent uptick in performance, although competition remains a concern [33] Question: Retention rate of prescribers - Management did not provide specific retention rates but noted ongoing trial and adoption among new prescribers [37][40] Question: Qbrexza's performance and overlap with Amrosi - Management reported good growth for Qbrexza despite competition, with effective overlap in marketing strategies for both products [41][42]

Revenue Performance - Total revenue for the three-month period ended September 30, 2025, increased by $3.0 million, or 21%, to $17.6 million compared to the same period in 2024[108]. - Product revenue, net for the three-month period ended September 30, 2025, was $17.0 million, reflecting a $2.4 million, or 16%, increase from $14.6 million in 2024[109]. - The U.S. commercial launch of Emrosi™ contributed $4.9 million to net product revenue in the third quarter of 2025[109]. - Total revenue for the nine-month period ended September 30, 2025, was $45.8 million, an increase of $3.3 million, or 8%, from $42.5 million in the same period of 2024[119]. - Product revenue, net for the nine-month period ended September 30, 2025, was $45.2 million, reflecting a $2.7 million, or 6%, increase from $42.5 million in the prior year, with $9.7 million attributed to the launch of Emrosi[120]. Expenses and Losses - Operating expenses for the three-month period ended September 30, 2025, totaled $19.2 million, an increase of $1.6 million, or 9%, from $17.5 million in 2024[108]. - Loss from operations improved by $1.4 million, or 47%, to a loss of $1.5 million for the three-month period ended September 30, 2025[108]. - The company reported a net loss of $2.3 million for the three-month period ended September 30, 2025, a slight improvement of $75,000, or 3%, compared to a net loss of $2.4 million in 2024[108]. - Selling, general and administrative expenses rose by $4.4 million, or 14%, to $34.5 million for the nine-month period ended September 30, 2025, compared to $30.1 million for the same period in 2024, mainly due to activities related to Emrosi's launch[128]. - Research and development expenses decreased by $555,000, or 66%, to $287,000 for the three-month period ended September 30, 2025[108]. - Research and development costs decreased by $9.3 million, or 97%, to $0.3 million for the nine-month period ended September 30, 2025, from $9.6 million in the same period of 2024, as the prior year included pre-approval project expenses for Emrosi[127]. Cash Flow and Financing - Cash and cash equivalents increased to $24.9 million as of September 30, 2025, compared to $20.3 million at December 31, 2024, with working capital rising to $16.7 million from $13.0 million[130]. - Net cash used in operating activities decreased by $5.2 million to $6.2 million for the nine-month period ended September 30, 2025, compared to $11.4 million for the same period in 2024[143]. - Net cash provided by financing activities increased by $4.4 million to $10.8 million for the nine-month period ended September 30, 2025, compared to $6.4 million for the same period in 2024[144]. - The company issued and sold 1,832,107 shares of common stock under the 2022 Shelf, generating net proceeds of $10.9 million during the nine-months ended September 30, 2025[140]. - The company received proceeds of $10.9 million from the issuance of common stock under the ATM program for the nine-month period ended September 30, 2025, compared to $1.7 million and $5.0 million in the previous year[144]. Debt and Obligations - Interest expense increased by $179,000, or 24%, to $937,000 for the three-month period ended September 30, 2025[108]. - Interest expense, net increased by $1.0 million, or 77%, to $2.3 million for the nine-month period ended September 30, 2025, from $1.3 million for the same period in 2024, primarily due to a higher principal balance under the Credit Agreement with SWK[129]. - The company is required to make regular payments under the SWK Credit Facility, with total expected payments of $32.1 million, including $25.0 million in principal and $5.9 million in interest[146]. - The maturity date of the existing Credit Facility has been extended from December 27, 2027, to June 27, 2028, and the revenue threshold for the Revenue-Based Payment provision has been lowered from $70.0 million to $60.0 million[137]. - The company is in compliance with the financial covenants under the Credit Facility as of September 30, 2025[139]. Other Revenue and Adjustments - Other revenue for the three-month period ended September 30, 2025, was $606,000, reflecting a 100% increase from no other revenue in 2024[110]. - Gross-to-net sales accruals increased by $2.4 million, or 24.5%, to $12.2 million as of September 30, 2025, compared to $9.8 million as of September 30, 2024, primarily due to the Emrosi coupon rebate allowance[112]. - Amortization of acquired intangible assets increased by $0.8 million, or 31%, to $3.2 million for the nine-month period ended September 30, 2025, driven by the addition of the Emrosi intangible asset[126]. - The company has contractual obligations for milestone and sales-based royalty payments, but the amounts cannot be reasonably predicted due to their contingent nature[146]. - The company executed a new At Market Issuance Sales Agreement in August 2025 to enhance capital structure and meet liquidity needs for Emrosi's commercialization[132].

Financial Performance - Third quarter 2025 net revenues were $17.6 million, a 21% increase from $14.6 million in the same quarter of 2024[3] - Total revenue for the three-month period ended September 30, 2025, was $17,631 million, a 20.5% increase from $14,629 million in the same period of 2024[16] - Product revenue for the nine-month period ended September 30, 2025, reached $45,173 million, up from $42,514 million in 2024, reflecting a growth of 6.2%[16] - The net loss for Q3 2025 was $2.3 million, slightly improved from a net loss of $2.4 million in Q3 2024[8] - The net loss for the three-month period ended September 30, 2025, was $2,315 million, a slight improvement from a net loss of $2,390 million in the same period of 2024[16] - Basic GAAP net loss per share for the three-month period ended September 30, 2025, was $0.09, compared to $0.12 in 2024[22] Expenses - Selling, general and administrative (SG&A) expenses were $12.1 million, reflecting a 6% increase from $11.4 million in Q3 2024, primarily due to Emrosi's commercialization[3] - Operating expenses for the three-month period ended September 30, 2025, totaled $19,160 million, compared to $17,523 million in 2024, representing a 9.3% increase[16] - Research and development expenses for the three-month period ended September 30, 2025, were $287 million, down from $842 million in 2024[16] - Interest expense for the three-month period ended September 30, 2025, was $937 million, compared to $758 million in 2024, indicating a 23.6% increase[16] - The company reported a total other expense of $786 million for the three-month period ended September 30, 2025, compared to an income of $504 million in the same period of 2024[16] Profitability Metrics - Adjusted EBITDA for Q3 2025 was $1.7 million, compared to $0.3 million in the prior-year quarter, reflecting a $1.4 million improvement[8] - Adjusted EBITDA for the three-month period ended September 30, 2025, was $1,676 million, significantly higher than $252 million in 2024[22] Cash Position - Cash and cash equivalents increased to $24.9 million as of September 30, 2025, up from $20.3 million at the end of 2024[8] Product Performance - Emrosi™ total prescriptions increased 146% over the second quarter of 2025, generating $4.9 million in net revenues for the third quarter[2] - Emrosi demonstrated superior efficacy in clinical trials, with statistically significant improvements over both placebo and doxycycline[8] - Expanded payer access for Emrosi now covers over 100 million commercial lives in the U.S., up from 54 million in May 2025[8] Future Outlook - The company anticipates significant operating leverage from the growth of Emrosi and its established dermatology commercial infrastructure[2] Gross Margin - Gross margin improved to 67.4% in Q3 2025, compared to 69.4% in Q3 2024, driven by higher-margin products and lower inventory costs[3] Share Information - The weighted average number of common shares for the three-month period ended September 30, 2025, was 24,959,114, an increase from 20,537,794 in 2024[22]

Core Insights - Journey Medical Corporation reported third quarter 2025 net revenues of $17.6 million, a 21% increase year-over-year from $14.6 million in Q3 2024, driven by the commercial launch of Emrosi™ [3][6] - Emrosi™ total prescriptions surged by 146% compared to the second quarter of 2025, generating $4.9 million in net revenues for the third quarter [1][3] - The company anticipates significant operating leverage from the growth of Emrosi and its established dermatology commercial infrastructure [3] Financial Results - Gross margin improved to 67.4% in Q3 2025, compared to 69.4% in Q3 2024, influenced by higher revenues from Emrosi and Qbrexza, despite a favorable one-time adjustment in the previous year [6] - Selling, general and administrative (SG&A) expenses rose to $12.1 million in Q3 2025, a 6% increase from $11.4 million in Q3 2024, primarily due to operational activities related to Emrosi's launch [6] - The net loss for Q3 2025 was $2.3 million, slightly improved from a net loss of $2.4 million in Q3 2024, translating to $(0.09) per share [6][17] Recent Corporate Highlights - Emrosi's clinical differentiation was validated through a pooled Phase 3 efficacy analysis, showing statistically significant superiority over Oracea® and placebo [3][12] - The company expanded payer access for Emrosi to over 100 million commercial lives in the U.S. as of July 2025, up from 54 million in May 2025 [12] - Journey Medical's cash and cash equivalents increased to $24.9 million as of September 30, 2025, compared to $20.3 million at the end of 2024 [6]

Core Viewpoint - Journey Medical Corporation is set to release its third quarter 2025 financial results on November 12, 2025, after U.S. financial markets close, followed by a conference call at 4:30 p.m. ET [1] Company Overview - Journey Medical Corporation is a commercial-stage pharmaceutical company focused on selling and marketing FDA-approved prescription products for dermatological conditions [4] - The company currently markets eight branded FDA-approved prescription drugs aimed at treating common skin conditions [4] - Founded by Fortress Biotech, Inc., Journey Medical is located in Scottsdale, Arizona, and is registered under the Securities Exchange Act of 1934, filing periodic reports with the SEC [4] Conference Call Details - Interested parties can listen to the conference call by dialing specific numbers for domestic and international participants, with a recommendation to join approximately 10 minutes prior to the start time [2] - A live audio webcast will be available on the company's website and will remain accessible for replay for about 30 days after the call [3]

Core Insights - Journey Medical Corporation presented efficacy data for DFD-29 (Emrosi) at the 2025 Fall Clinical Dermatology Conference, demonstrating its superiority over both placebo and Oracea in treating inflammatory lesions of rosacea [1][2][3] Company Overview - Journey Medical Corporation is a commercial-stage pharmaceutical company focused on marketing FDA-approved prescription products for dermatological conditions, currently marketing eight branded drugs [11] Clinical Trial Results - In the Phase 3 trials, 62.7% of subjects treated with DFD-29 achieved IGA treatment success, compared to 39.0% for Oracea and 28.2% for placebo, with all comparisons showing statistical significance (p<0.001) [3][4][6] - The mean reduction in inflammatory lesions for DFD-29 was 19.2, compared to 14.8 for Oracea and 11.3 for placebo, also statistically significant (p<0.001) [3][4][6] Market Position - The results from the Phase 3 trials reinforce Emrosi's efficacy and safety profile, positioning it as a significant treatment option in the growing dermatology market [2][6] - The company aims to expand Emrosi's reach, believing it has the potential to become the standard of care for rosacea [2]

Core Insights - Journey Medical Corporation is a commercial-stage pharmaceutical company focused on FDA-approved prescription products for dermatological conditions [1][2] - The company will participate in two investor conferences in October 2025, indicating active engagement with the investment community [1][2] Event Details - The 4th Annual ROTH Healthcare Opportunities Conference will take place on October 9, 2025, in New York City, featuring 1x1 meetings [2] - The ThinkEquity Conference is scheduled for October 30, 2025, also in New York City, and will include presentations and 1x1 meetings [2] Company Overview - Journey Medical markets eight branded FDA-approved prescription drugs aimed at treating common skin conditions [2] - The company is based in Scottsdale, Arizona, and was founded by Fortress Biotech, Inc. [2] - Journey Medical's stock is registered under the Securities Exchange Act of 1934 and files periodic reports with the SEC [2]