0001628280-26-029819
SEC filingQ1 losses narrowed and cash burn improved versus prior year, driven by restructuring benefits including lower R&D expenses, despite revenue decline from absence of prior license revenue and gross-to-net pressures on ZYNLONTA sales.
ADC Therapeutics reported Q1 FY2026 revenue of $20.9 million, down 9.5% from $23.0 million in the prior-year quarter. This decline reflects the absence of license revenue recognized in Q1 FY2025, combined with gross-to-net deduction pressures on ZYNLONTA product sales, even as volume and pricing contributed positively to product revenue. The company continues long-term supply chain investments to support current and future revenue forecasts for ZYNLONTA.
Net income loss narrowed to -$33.0 million from -$38.6 million (14.6% YoY improvement), with diluted EPS at -$0.21 versus -$0.36 (41.7% improvement). The progress stems from the smaller operating loss and favorable working capital movements in the period.
Cost of product sales rose, driven by a shift in personnel focus from R&D clinical supply to commercial manufacturing activities, alongside royalties on ZYNLONTA net sales, idle capacity costs, and inventory write-downs for excess or failed specification inventory. Management notes that cost of product sales will continue increasing as the company sells through pre-approval inventory previously expensed before U.S. commercialization. Product sales increases were primarily attributable to higher sales volume and pricing.