Emmaus Life Sciences reported a 38 % drop in net revenues to $3.4 million for the three months ended September 30, 2025, compared with $5.5 million in the same period a year earlier. The decline was driven by a sharp erosion of U.S. sales—$2.1 million versus $3.2 million a year ago—after the company’s marketing exclusivity for Endari® expired in July 2024 and generic L‑glutamine entered the market. International sales also slipped, falling to $1.2 million from $2.3 million, as demand in the Middle East and North Africa (MENA) region weakened.
The company posted a net loss of $2.1 million, or $0.03 per share, a swing from a $1.8 million net income in Q3 2024. Operating expenses fell 43 % to $2.4 million, largely due to a reduction in selling, general and administrative costs after the U.S. sales force was scaled back. However, “other expenses” rose sharply, driven by a decrease in the fair value of conversion‑feature derivative liabilities, higher interest expense, and a loss on debt extinguishment. The combination of revenue contraction and the increase in other expenses turned the prior year’s profit into a loss.
Cash and cash equivalents stood at only $0.3 million as of September 30, 2025, underscoring the company’s acute liquidity constraints. Management reiterated a “substantial doubt” about the company’s ability to continue as a going concern without restructuring debt and raising additional financing, a warning that highlights the urgency of the company’s financial situation.
Sequentially, Q2 2025 revenue was $2.8 million and the net loss was $1.1 million, indicating a steep decline in both top‑line and bottom‑line performance over the last two quarters. The year‑over‑year swing from $5.5 million to $3.4 million in revenue and from a $1.8 million profit to a $2.1 million loss illustrates a rapid deterioration in the company’s financial health.
CEO Willis Lee said the revenue decline was “ongoing competition from generic L‑glutamine in the U.S. and lower sales in the MENA region.” He added that the company has reduced operating expenses by 43 % but remains focused on securing financing and restructuring debt to address the liquidity crisis. Lee’s comments signal that the company is in a defensive mode, prioritizing cost containment while seeking external capital to survive the competitive and cash‑flow pressures.
The earnings report signals a critical juncture for Emmaus Life Sciences. The combination of a sharp revenue decline, a swing to net loss, a severely depleted cash balance, and a going‑concern warning suggests that the company’s short‑term viability hinges on successful debt restructuring and new capital infusion. Without such measures, the company faces a high risk of default or forced liquidation, and its ability to compete in the U.S. and MENA markets will likely continue to be constrained by generic competition and limited financial resources.
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