Lantheus (LNTH) Q2 Revenue Falls 4%

Lantheus (LNTH -28.64%), a developer of diagnostic and therapeutic radiopharmaceuticals, reported results on August 6, 2025, for Q2 FY2025. In its latest release, the company missed both GAAP revenue and non-GAAP earnings estimates.—reporting GAAP revenue of $378.0 million versus analyst expectations of $387.94 million, and adjusted earnings per share (EPS) of $1.57 versus the consensus estimate of $1.68. Both figures also declined compared to the prior year, with GAAP revenue down 4.1% and adjusted fully diluted earnings per share (non-GAAP) down 12.8%. The company also cut its full-year FY2025 financial outlook, lowering revenue guidance to $1.475 billion–$1.51 billion and adjusted fully diluted EPS guidance to $5.50–$5.70, reflecting continued pressure on its key PYLARIFY prostate cancer diagnostic business and a reset of growth assumptions. Overall, the quarter showed softer operational performance, but saw progress in diversification and investments to support future growth.

Source: Analyst estimates provided by FactSet. Management expectations based on management's guidance, as provided in Q1 2025 earnings report.

Business Overview and Focus Areas

Lantheus focuses on imaging agents and therapeutics for oncology, neurology, and cardiology applications. Its core business is in radiopharmaceuticals, which are drugs containing radioactive isotopes for diagnosing and treating disease. Key marketed products include PYLARIFY, a positron emission tomography (PET) imaging agent used to detect prostate cancer, and DEFINITY, an ultrasound enhancing agent for cardiac imaging.

In recent years, the company has prioritized growing its product pipeline and diversifying revenues beyond PYLARIFY by acquiring new assets, such as Life Molecular Imaging and Evergreen Theragnostics. Success depends on driving innovation, securing regulatory approvals, maintaining competitive advantage, ensuring reimbursement for key products, and integrating new acquisitions to expand capabilities and reach.

Quarter Highlights: What Happened and Why

GAAP revenue fell below both expectations and the prior year, in large part because of an 8.3% decline in PYLARIFY sales, which dropped to $250.6 million. Lantheus cited both increasing competition from other prostate cancer imaging agents—especially those using gallium-based compounds—and changing Medicare reimbursement rules as primary challenges. TechneLite, a technetium generator for imaging, also fell 11.4% to $25.0 million (GAAP) due to its legacy position and company plans to divest the SPECT imaging business. However, DEFINITY, the ultrasound enhancing agent for cardiology imaging, rose 7.5% to $83.9 million (GAAP), and revenue from partnerships and other sources jumped 32.8% to $11.6 million.

Margins trended lower in Q2 2025. Adjusted operating income (non-GAAP) declined 10.8% and Adjusted net income (non-GAAP) dropped 12.8%. Lantheus attributed these contractions to several factors, including reduced gross profit from lower sales and increased general and administrative expenses.

The company made notable progress executing its portfolio strategy. During the quarter, it completed the acquisition of Evergreen Theragnostics in April—bringing OCTEVY, a late-stage PET agent for neuroendocrine tumors, and expanded radioligand manufacturing. In July, Lantheus closed on Life Molecular Imaging, adding Neuraceq, a PET agent for imaging beta-amyloid plaques in Alzheimer’s disease. Both deals advance Lantheus’s goal of building a broader pipeline in oncology and neurology. The sale of the SPECT business, expected to close by year-end, further concentrates its focus on higher-margin growth areas like PET and radiotherapeutics.

Regulatory developments were another theme. The company reported that its MK-6240 tau PET agent (for Alzheimer’s diagnostics) met endpoints in two major clinical trials. In April 2025, Lantheus announced that MK-6240 met its primary endpoints in two pivotal clinical studies assessing sensitivity and specificity and expects to submit a new drug application by Q3 2025. Additionally, the Food and Drug Administration (FDA) accepted a new drug application (NDA) for a reformulated PYLARIFY, with a PDUFA target action date of March 6, 2026, and an updated indication for Neuraceq was approved, expanding its use in identifying patients suited for amyloid-targeted therapies.

Reimbursement pressures continued for PYLARIFY, with changes in Medicare policy now basing payments on mean unit cost rather than average selling price, affecting about 20% of U.S. patients as of CY2025. Management described this as “temporal,” expecting sites to gradually adapt, but the near-term effect on pricing and sales was significant. To address lost share at smaller accounts, the company is increasing efforts to expand access and services at these lower-volume sites, which tend to be more sensitive to price and less loyal to established vendors.

No dividend was declared, and Lantheus does not currently pay a dividend. Lantheus announced a new $400 million stock repurchase authorization, replacing the previous 12-month program announced in November 2024, as part of its strategy to manage shareholder value while navigating near-term business headwinds.

Looking Forward: Guidance and Key Watchpoints

Lantheus materially reduced its outlook for FY2025, lowering revenue guidance to $1.475 billion–$1.51 billion and adjusted fully diluted EPS guidance to $5.50–$5.70. Revenue guidance is now $1.475–$1.51 billion, lowered from the prior range of $1.55–$1.585 billion. Adjusted fully diluted EPS—a measure that excludes non-recurring and non-cash items—was also cut sharply, to $5.50–$5.70 from $6.60–$6.70. Management attributed these changes to continued PYLARIFY headwinds and investment required to integrate new acquisitions and advance the product portfolio.

For the remainder of the year and into 2026, investors should pay close attention to the rollout of new PET diagnostic and therapeutic products, ongoing integration of acquired businesses, stabilization of PYLARIFY sales, and margin trends. The launch timeline and commercial trajectory for assets like Neuraceq, OCTEVY, and MK-6240 will be particularly important for offsetting pressure in the core prostate cancer imaging business. No specific details on 2026 guidance were provided.

Revenue and net income presented using U.S. generally accepted accounting principles (GAAP) unless otherwise noted.