Aurinia Pharmaceuticals shares plummet amid failed buyer hunt, 25% employee layoff plans

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on Feb 15, 2024
Updated: Feb 19, 2024
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  • Aurinia Pharmaceuticals reported a quarterly loss of $0.19 per share.
  • Revenue for the quarter ended December 2023 stood at $45.1 million.
  • The company intends to reduce employee headcount by at least 25% by the end of Q1 2024.

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U.S.-listed shares of Aurinia Pharmaceuticals (AUPH.O) witnessed a significant downturn, plummeting 25% to $6 in pre-market trading.

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The pharmaceutical company announced the conclusion of its strategic review, initiated in June 2023, but failed to attract any formal offers, a report by Reuters said.

Aurinia layoff plans

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According to reports, Aurinia Pharmaceuticals intends to decrease its workforce by a minimum of 25% by the conclusion of the first quarter, although this reduction will not affect positions deemed essential for commercial operations or those that provide support to commercial functions.

Focus on kidney disease drug

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Key highlights of Aurinia’s strategic shift include halting the development of its immunotherapies, AUR200 and AUR300, to redirect focus towards its kidney disease drug Lupkynis. Additionally, the company intends to reduce employee headcount by at least 25% by the end of Q1 2024.

To mitigate the impact of the market downturn, Aurinia has initiated a share repurchase program of up to $150 million.

Quarterly loss of $0.19 per share

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Aurinia Pharmaceuticals reported a quarterly loss of $0.19 per share, slightly below the Zacks Consensus Estimate of a loss of $0.18. Despite this, the company showed resilience compared to the previous year’s loss of $0.18 per share, adjusted for non-recurring items.

The quarterly earnings report resulted in an earnings surprise of -5.56%, indicating slightly lower-than-anticipated performance. However, the company has exceeded consensus EPS estimates in three of the last four quarters.

Revenue beats estimates

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Revenue for the quarter ended December 2023 stood at $45.1 million, surpassing the Zacks Consensus Estimate by 3.52%.

This marked a substantial increase from the year-ago period’s revenue of $28.44 million.

Aurinia has consistently exceeded consensus revenue estimates over the past four quarters.

Investor sentiment is key

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Despite the recent market turbulence, the outlook for Aurinia hinges on management’s commentary. Investor sentiment will likely be influenced by the company’s future earnings expectations and strategic initiatives.

Investors would closely monitor any revisions in earnings estimates and industry trends to gauge the stock’s future performance.

Recursion Pharmaceuticals (RXRX), another player in the same industry, is yet to report results for the quarter ended December 2023.

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