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Editas Medicine Misses Revenue, Earnings Targets for Q4

By Mark Prvulovic – Feb 26, 2020 at 5:50PM

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Analysts were expecting more from the clinical-stage biotech in the fourth quarter.

One of the leading gene-editing companies on the market, Editas Medicine (EDIT -4.01%), reported its fourth-quarter and full-year financial results after the bell Wednesday. While revenue was higher for the quarter, the company missed both its earnings and revenue estimates.

As an early-stage clinical biotech, Editas doesn't have any products on the market yet -- it derives all of its revenue from collaboration and research agreements. That revenue came in at $12.3 million in Q4, more than twice the $6.1 million it reported in the year-ago period. On a full-year basis, however, Editas' revenue figures don't look as good, having fallen by around 30% to $20.5 million from 2018's result of $31.9 million.

A strand of DNA getting a piece removed by a scientist.

Image source: Getty Images.

Editas reported a net loss of $37.7 million for the quarter, around 50% higher than the $25.1 million net loss of the year-ago period. However, with approximately $457.1 million in cash, cash equivalents, and marketable securities on hand, the company remains quite able to fund its operations for some time.

Further details

Wall Street analysts' consensus forecast had been for fourth-quarter revenue of $50.7 million, significantly higher than what Editas ended up reporting. Earnings also fell below expectations, as analysts thought the gene-editing company would report earnings per share of $0.13. Instead, Editas reported a net loss of $0.74 per share. 

Editas is working on a number of treatments, but its flagship drug candidate is EDIT-101, which treats an eye disorder called Leber congenital amaurosis, which causes children to be born with severe visual impairment. The company is also working on a sickle cell disease and transfusion-dependant beta-thalassemia drug, EDIT-301. So far, EDIT-101 is the company's only drug to reach early clinical testing.

Mark Prvulovic has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Editas Medicine. The Motley Fool has a disclosure policy.

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