Jazz Pharmaceuticals (JAZZ -4.79%) is a global biopharmaceutical company focused on innovative therapies for neuroscience and rare oncology diseases. On August 5, 2025, it reported second quarter results for fiscal 2025. The company announced GAAP revenue of $1.05 billion, rising 2% from the same period last year, but slightly under the $1.05 billion analyst estimate (GAAP revenue). Non-GAAP earnings per share (EPS) were $(8.25), falling short of the consensus non-GAAP EPS estimate of $(7.61), mainly because of a $905.4 million one-time charge linked to the acquisition of Chimerix and its pipeline drug dordaviprone. While Neuroscience product sales showed positive trends, especially from its key Xywav and Epidiolex franchises, some oncology products continued to face competitive and protocol-driven headwinds. Overall, the period highlighted steady top-line growth, heavy non-recurring expenses, and a continued pivot toward portfolio diversification.
| Metric | Q2 2025 | Q2 2025 Estimate | Q2 2024 | Y/Y Change |
|---|---|---|---|---|
| EPS (Non-GAAP) | $(8.25) | $(7.61) | $5.25 | (257.1%) |
| Revenue (GAAP) | $1.05 billion | N/A | $1.02 billion | 2.1% |
| Gross Margin (Non-GAAP) | 92.3% | 92.5% | (0.2) pp | |
| SG&A Expense (Non-GAAP) | $310.3 million | $303.4 million | 2.3% decrease | |
| R&D Expense (Non-GAAP) | $167.0 million | $203.5 million | (17.9%) |
Source: Analyst estimates provided by FactSet. Management expectations based on management's guidance, as provided in Q1 2025 earnings report.
Company Overview and Strategic Focus
Jazz Pharmaceuticals develops and markets medicines primarily for neurological disorders and rare cancers. Its main commercial products address sleep disorders, seizure-related diseases, and several types of cancer. The company’s best-known drugs include Xywav (a low-sodium oxybate oral solution for narcolepsy and idiopathic hypersomnia), Epidiolex (cannabidiol, a plant-derived medicine for rare forms of epilepsy), and key oncology franchises such as Rylaze (for leukemia) and Zepzelca (for small cell lung cancer).
In recent years, Jazz has prioritized diversification. It is reducing dependence on older products like Xyrem (a sodium oxybate for narcolepsy) in favor of newer assets with longer exclusivity and broader potential. The company’s growth strategy relies on building a robust research pipeline, integrating acquisitions, and defending intellectual property. Regulatory approvals, successful launch execution, and market access arrangements with U.S. pharmacy benefit managers (PBMs) are key to expanding patient reach and revenue streams.
Quarterly Results: Highlights and Trends
Total revenue (GAAP) was $1.05 billion, up 2.1% from $1.02 billion in Q2 2024 (GAAP). This revenue climb was supported by growth in the neuroscience segment, which includes top sellers Xywav and Epidiolex. Neuroscience revenue increased by 3% to $761.2 million. Xywav net product sales rose 13% to $415.3 million, with demand from both narcolepsy and idiopathic hypersomnia patients fueling growth. The number of active Xywav patients climbed to 15,225 by period end—over 600 net new Xywav patients compared to March 2025. Management highlighted the continued advantage of Xywav’s lower sodium profile and strong uptake among patients switching from high-sodium products or newly diagnosed with sleep disorders.
Epidiolex, the company’s cannabidiol (CBD) oral medication for rare seizure types, generated $251.7 million in net product sales, a 2% rise. Usage expanded both in the U.S. and internationally, with coverage and adoption in more than 35 countries. However, overall growth in neuroscience was partially offset by legacy drugs: Xyrem net product sales (GAAP) continued to decline, dropping 43% to $35.3 million. High-sodium oxybate authorized generic royalties were $54.1 million.
The oncology segment, by contrast, saw net product sales dip 1% to $274.1 million (GAAP). Persistent challenges were evident for two major oncology brands. Rylaze, a therapy for acute lymphoblastic leukemia (ALL), dropped 7% to $100.7 million due to changes in pediatric treatment protocols that reduced class-wide usage of asparaginase. Zepzelca, a chemotherapy for second-line small cell lung cancer, fell 8% to $74.5 million, facing both new competition and protocol updates that delayed patient progression into second-line treatment. While newer oncology assets like Ziihera—a HER2-targeted monoclonal antibody recently launched for biliary tract cancer—added $6.0 million in net product sales after gaining European approval, this was not enough to fully offset declines in established brands.
Selling, general, and administrative (SG&A) expense rose to $310.3 million on a non-GAAP basis, up 2.3% from the prior year, largely tied to increased headcount. Research and development (R&D) costs dropped to $167.0 million on a non-GAAP basis, an 18.0% decrease, due to portfolio reprioritization, including completion of certain studies and some pipeline discontinuations. The sharpest financial impact was a one-time, non-cash $905.4 million charge for acquired in-process research and development (IPR&D) related to the Chimerix acquisition and its brain cancer drug dordaviprone. This single expense swung both net income and non-GAAP earnings into deep losses—non-GAAP adjusted net loss was $(504.8) million, compared to $360.7 million of income in Q2 2024.
Management pointed to several pipeline catalysts and regulatory milestones on the horizon. Zepzelca received FDA Priority Review for a new use as first-line maintenance in extensive-stage small cell lung cancer, with a decision expected by October 2025. Zanidatamab, a dual HER2-targeted antibody marketed as Ziihera, has Phase 3 data for first-line gastroesophageal adenocarcinoma expected in Q4 2025. The approval application for dordaviprone was accepted by the FDA with a target action date of August 18, 2025. Each of these represent near-term drivers that could materially alter Jazz’s growth prospects.
Cost discipline and cash management remained areas of scrutiny. Cash and short-term investments totaled $1.7 billion as of June 30, 2025, down from $2.41 billion as of December 31, 2024. as the company financed acquisitions and repurchased shares. $125 million in shares were repurchased, with another $225 million in authorization remaining as of June 30, 2025. Long-term debt (GAAP) declined to $5.4 billion as of June 30, 2025, from $6.1 billion as of December 31, 2024. Jazz produced $518.6 million in cash flow from operations through the first six months of fiscal 2025, underscoring solid underlying business performance outside of acquisition-related distortions.
Looking Ahead: Guidance and Investor Focus
Jazz management reaffirmed its full-year 2025 total revenue guidance, targeting a range of $4.15 billion to $4.30 billion in total revenues. The midpoint represents about 4% annual growth. Non-GAAP net income is now set for $300 million to $350 million for FY2025, and projected non-GAAP EPS is $4.80-$5.60 for FY2025, with the lower end of the forecast range raised. R&D and SG&A guidance were trimmed at the low end, partly offsetting the non-recurring $905 million IPR&D charge. The company projected a non-GAAP effective tax rate of 27% to 37% for FY2025.
In the near term, investors will be watching regulatory outcomes for dordaviprone, Zepzelca’s expanded label, and zanidatamab’s ongoing pivotal trials. Competitive pressures—especially from Avadel’s narcolepsy drug Lumryz—present ongoing risks in core sleep treatment markets, but recent court rulings have upheld Xywav’s patent position for idiopathic hypersomnia. Oncology performance remains a question mark as new competitors enter the field and long-standing protocols evolve.
JAZZ does not currently pay a dividend.
Revenue and net income presented using U.S. generally accepted accounting principles (GAAP) unless otherwise noted.
