OPK Stock Slips Following Q1 Earnings Miss, Gross Margin Expands

Core Viewpoint - OPKO Health, Inc. reported a narrower loss per share of 10 cents in Q1 2025 compared to a loss of 12 cents in the same period last year, but this was wider than the Zacks Consensus Estimate of a loss of 6 cents per share [1][13] Revenue Summary - OPKO Health's total revenues for Q1 2025 were $149.9 million, reflecting a 13.7% decrease year over year and missing the Zacks Consensus Estimate by 8.9% [1][2] - Revenues from the Diagnostics segment amounted to $102.8 million, down 18.9% year over year, primarily due to lower clinical test volume [4] - In the Pharmaceuticals segment, revenues from products declined 8.7% year over year to $34.8 million, impacted by unfavorable foreign currency exchange and decreased Rayaldee sales [5] - Revenues from the transfer of intellectual property increased by 41.4% year over year to $12.3 million, driven by a significant rise in BARDA contract revenues [6] Margin Analysis - Gross profit increased by 1.4% year over year to $42.6 million, with gross margin expanding by 424 basis points to 28.4% [7] - Selling, general and administrative expenses decreased by 15.8% year over year to $59.1 million, while research and development expenses rose by 40.6% to $30.8 million [7][8] Financial Position - OPKO Health ended Q1 2025 with cash and cash equivalents of $436 million, slightly up from $431.9 million at the end of 2024 [9] Guidance - The company revised its 2025 revenue outlook to a range of $675 million to $685 million, down from a previous range of $675 million to $700 million [11] - Product sales are expected to be between $165 million and $175 million, while other revenues are now projected to be between $75 million and $85 million [12] Recent Developments - OPKO Health signed an agreement with Labcorp to sell oncology-related clinical testing assets and entered a collaboration with Entera Bio for an oral GLP-1/glucagon tablet candidate [15] - ModeX Therapeutics Inc., a subsidiary of OPKO, is advancing its immuno-oncology and immunology portfolio with four clinical candidates [15]