Breaking Down XOMA Corporation (XOMA) Financial Health: Key Insights for Investors

Are you keeping a close watch on biotech royalty aggregators? Have you been following XOMA Royalty Corporation (XOMA) and wondering about its financial stability? In 2024, the company doubled its royalty and milestone portfolio to over 120 assets through five transactions and completed two company acquisitions. But how has this growth impacted its financial health? Let's delve into XOMA's 2024 financial results, exploring key metrics like the increase in total income and revenues to $28.5 million, the net loss of $13.8 million, and cash receipts of $46.3 million, to provide investors with critical insights.

XOMA Corporation (XOMA) Revenue Analysis

As a biotechnology company, XOMA Corporation's revenue streams are primarily tied to its licensing and royalty agreements, as well as collaborative research and development activities. Understanding these revenue sources and their fluctuations is crucial for investors.

XOMA's revenue is largely derived from:

• Licensing Fees: Upfront and milestone payments from licensing its antibody technologies.
• Royalty Revenues: Royalties on net sales of products developed using XOMA's technologies.
• Collaborative Agreements: Payments from partnerships with other pharmaceutical and biotechnology companies for research and development.

Analyzing year-over-year revenue growth rates provides insights into XOMA's financial trajectory. However, pinpointing exact revenue figures and growth rates requires access to the company's latest financial reports. As of my knowledge cut-off in April 2025, the most recent complete fiscal year data available would typically be for 2024. For precise figures, consulting XOMA's 2024 Annual Report (Form 10-K) filed with the Securities and Exchange Commission (SEC) is essential.

The contribution of different business segments to XOMA's overall revenue can vary significantly from year to year, depending on the timing of licensing agreements, milestone achievements, and product sales by its partners. Monitoring these shifts is vital for assessing the stability and potential growth of XOMA's revenue.

Significant changes in revenue streams often reflect key events such as new licensing deals, clinical trial successes of partnered products, or changes in market conditions affecting product sales. Investors should closely examine these developments and their potential impact on XOMA's future financial performance.

Here's a general example of how revenue sources might be broken down (note that this is illustrative and not based on actual 2024 data):

For more detailed information, you can explore: Breaking Down XOMA Corporation (XOMA) Financial Health: Key Insights for Investors

XOMA Corporation (XOMA) Profitability Metrics

Analyzing XOMA Corporation's (XOMA) profitability involves examining several key metrics to understand its financial health and operational efficiency. Let's delve into the details:

Gross Profit:

XOMA reported a gross profit of $25.61 million for the trailing twelve months (TTM) ending December 31, 2024. This indicates the revenue remaining after deducting the cost of goods sold.

Operating Profit:

XOMA's operating profit for the quarter ending September 2024 was -$15.64 million. The operating profit margin (TTM) stands at -305.86%, reflecting significant operating losses.

Net Profit:

The company's net loss for the full year 2024 was $13.8 million. This loss was primarily attributed to $30.9 million in non-cash credit losses on purchased receivables. The net loss attributable to common stockholders was $19.29 million, or $1.00 per share.

Profitability Trends Over Time:

While XOMA is not yet profitable, there are indicators of improving financial performance:

• Total income and revenues for 2024 increased to $28.5 million, a substantial rise from $4.8 million in 2023.
• The net loss of $13.8 million for 2024 is an improvement compared to the net loss of $40.8 million in 2023.
• Gross Profit Margin: 99.28%.

Comparison with Industry Averages:

It's essential to compare XOMA's profitability ratios with industry averages to gauge its relative performance. However, without specific industry averages readily available, a direct comparison is challenging. Nevertheless, the high gross profit margin of 99.28% suggests that XOMA maintains a high level of profitability on its products, which could bode well for future financial results once revenue scales further.

Operational Efficiency:

XOMA's operational efficiency can be assessed through various factors:

• Cost Management: Research and Development (R&D) expenses were $2.9 million for the full year 2024.
• Gross Margin Trends: XOMA has been able to maintain a high level of profitability on its products with a gross profit margin of 97.9%.

Additional Key Financial Data for 2024:

Here's a snapshot of XOMA's financial performance in 2024:

For more insights into XOMA's strategic direction, explore Mission Statement, Vision, & Core Values of XOMA Corporation (XOMA).

XOMA Corporation (XOMA) Debt vs. Equity Structure

Understanding XOMA Corporation's financial health requires a close look at its debt and equity structure. This involves assessing the levels of debt the company carries, how it compares to its equity, and how it manages its financing strategies. The balance between debt and equity is crucial for funding growth and maintaining financial stability.

As of the fiscal year 2024, a comprehensive analysis of XOMA Corporation's debt levels reveals the following:

• Long-term Debt: Information on XOMA's long-term debt for 2024 is not available in the provided search results.
• Short-term Debt: Similarly, specific figures for XOMA's short-term debt in 2024 are not provided in the search results.

The debt-to-equity ratio is a critical metric for evaluating a company's financial leverage. It indicates the proportion of debt and equity used to finance the company's assets. While the exact debt-to-equity ratio for XOMA Corporation in 2024 is not available in the search results, it's important to understand how this ratio generally impacts financial health.

A high debt-to-equity ratio can indicate that a company relies heavily on debt financing, which may increase financial risk. Conversely, a low ratio suggests a more conservative approach, with a greater reliance on equity. Comparing XOMA's ratio to industry standards would provide insights into whether the company's leverage is typical or deviates significantly.

Recent financial activities, such as debt issuances, credit ratings, or refinancing, can significantly influence a company's financial structure. However, specific details regarding XOMA Corporation's recent debt-related activities in 2024 are not available in the provided search results.

Balancing debt and equity is a strategic decision that impacts a company's financial flexibility and risk profile. Without the specific 2024 data for XOMA Corporation, a detailed analysis of their approach is not possible. However, understanding this balance is essential for investors assessing the company's long-term financial stability and growth potential. More up-to-date information would be needed to provide a complete picture of XOMA's financial health in terms of its debt and equity structure.

For more insights into XOMA Corporation's financial health, you can read: Breaking Down XOMA Corporation (XOMA) Financial Health: Key Insights for Investors

XOMA Corporation (XOMA) Liquidity and Solvency

Assessing a company's financial health involves a deep dive into its liquidity and solvency positions. For XOMA Corporation (XOMA), understanding these metrics provides key insights for investors. Liquidity refers to the company's ability to meet its short-term obligations, while solvency indicates its capacity to meet long-term debts.

Here’s an overview of XOMA's liquidity, working capital trends, and cash flow dynamics:

Current and Quick Ratios

The current and quick ratios are essential indicators of a company's liquidity position. These ratios measure XOMA's ability to cover its short-term liabilities with its short-term assets. The current ratio is calculated by dividing current assets by current liabilities, while the quick ratio excludes inventories from current assets to provide a more conservative measure.

As of the fiscal year 2024, detailed calculations and analysis of these ratios would offer a clear picture of XOMA's immediate financial health. For instance, a current ratio above 1 suggests that XOMA has more current assets than liabilities, indicating a strong liquidity position. However, without specific 2024 figures, a general understanding of these ratios' importance is crucial. Monitoring these ratios over time helps identify trends in XOMA's liquidity management.

Analysis of Working Capital Trends

Working capital, calculated as current assets minus current liabilities, is a fundamental measure of a company's operational efficiency and short-term financial health. For XOMA Corporation, tracking working capital trends provides insights into how effectively the company manages its resources. An increasing working capital balance typically suggests improved liquidity, while a decreasing balance may signal potential challenges in meeting short-term obligations.

Effective management of working capital involves optimizing inventory levels, accounts receivable, and accounts payable. Changes in these components can significantly impact XOMA’s overall financial stability. Analyzing these trends in the context of XOMA's operational activities offers a more nuanced understanding of its financial management practices. Maintaining a healthy working capital balance is crucial for sustaining day-to-day operations and funding future growth initiatives.

Cash Flow Statements Overview

The cash flow statement is a critical financial document that outlines the movement of cash both into and out of a company during a specific period. It is divided into three main sections: operating activities, investing activities, and financing activities. Analyzing the trends within these sections provides a comprehensive view of XOMA Corporation's financial health.

• Operating Activities: Cash flow from operating activities reflects the cash generated from XOMA's core business operations. A positive cash flow here indicates that the company is effectively generating cash from its primary activities, which is essential for sustaining and growing the business.
• Investing Activities: This section includes cash flow related to the purchase and sale of long-term assets, such as property, plant, and equipment (PP&E), as well as investments in other companies. Monitoring these cash flows helps understand XOMA's investment strategies and capital expenditures.
• Financing Activities: Cash flow from financing activities involves transactions related to debt, equity, and dividends. Analyzing this section provides insights into how XOMA is funding its operations and managing its capital structure.

Below is an example of how cash flow activities might be represented (Note: This table is for illustrative purposes only and does not reflect actual XOMA Corporation data):

Potential Liquidity Concerns or Strengths

Identifying potential liquidity concerns or strengths is crucial for investors. Consistent positive cash flow from operations and a healthy working capital balance generally indicate strong liquidity. However, negative trends or significant fluctuations warrant closer examination.

For example, a sharp decrease in the current ratio or a significant increase in short-term debt could signal potential liquidity issues. Conversely, a consistent increase in cash reserves or strategic investments in liquid assets may indicate a strengthening liquidity position. Monitoring these factors over time provides a comprehensive view of XOMA's ability to meet its short-term financial obligations and sustain its operations.

To gain more insight into the values and principles that guide XOMA Corporation, consider exploring: Mission Statement, Vision, & Core Values of XOMA Corporation (XOMA).

XOMA Corporation (XOMA) Valuation Analysis

Determining whether XOMA Corporation (XOMA) is overvalued or undervalued requires a multifaceted approach, considering various financial metrics and market dynamics. Here's a breakdown of key valuation indicators:

Valuation Ratios:

While specific P/E, P/B, and EV/EBITDA ratios for XOMA Corporation aren't readily available in the provided search results, these are standard tools for valuation analysis. Generally:

• Price-to-Earnings (P/E) Ratio: Compares a company's stock price to its earnings per share. A high P/E ratio might suggest overvaluation, or it could indicate that investors expect high growth in the future. Conversely, a low P/E could signal undervaluation or a lack of investor confidence.
• Price-to-Book (P/B) Ratio: Compares a company's market capitalization to its book value of equity. A P/B ratio below 1.0 could suggest undervaluation, while a higher ratio might indicate overvaluation.
• Enterprise Value-to-EBITDA (EV/EBITDA): Compares a company's enterprise value (market cap plus debt, minus cash) to its earnings before interest, taxes, depreciation, and amortization. A lower EV/EBITDA multiple often indicates better value.

Stock Price Trends:

Analyzing XOMA Corporation's stock price trends over the last 12 months (or longer) provides insight into market sentiment and company performance. As of April 2024, XOMA's stock has shown significant volatility. To assess whether the stock is correctly valued, compare its performance against industry peers and relevant market indices.

Dividend Yield and Payout Ratios:

As of now, XOMA Corporation does not offer dividends. Therefore, dividend yield and payout ratios are not applicable in this valuation analysis.

Analyst Consensus:

The analyst consensus on XOMA Corporation's stock valuation provides a summarized view of expert opinions. Based on recent data, the consensus leans towards a 'Buy' rating, with price targets suggesting potential upside from current levels. However, it’s essential to consider that analyst ratings can vary and should not be the sole basis for investment decisions.

To get a more detailed overview, consider exploring: Breaking Down XOMA Corporation (XOMA) Financial Health: Key Insights for Investors

XOMA Corporation (XOMA) Risk Factors

Like many biotechnology firms, XOMA faces substantial financial risks. Developing new treatments is very costly, and there's no guarantee that research and development (R&D) will be successful. This uncertainty can make it hard to secure funding and manage cash flow effectively. Unexpected setbacks in clinical trials or regulatory hurdles can significantly strain XOMA's financial resources, potentially affecting its ability to continue operations.

One of the primary risks for XOMA lies in the clinical and regulatory landscape. The path to market for new drug candidates is fraught with uncertainty. Clinical trials may not always yield positive results, and regulatory agencies like the FDA can change their requirements, leading to delays and increased costs. For example, failure to meet endpoints in Phase 3 trials or rejection of a Biologics License Application (BLA) could severely impact XOMA's prospects.

Industry competition presents another significant risk. The biotechnology sector is characterized by intense competition, with numerous companies vying for market share. Larger pharmaceutical companies with greater resources could pose a threat to XOMA, potentially eroding its market position. Additionally, the emergence of biosimilars—similar versions of already approved biologic drugs—could undermine the profitability of XOMA's products.

Operational risks also play a crucial role. These include:

• Manufacturing challenges: Ensuring consistent and high-quality production of biologic drugs can be complex. Any disruptions in the manufacturing process could lead to supply shortages and revenue losses.
• Reliance on partnerships: XOMA often collaborates with other companies to develop and commercialize its products. Dependence on these partnerships introduces risks, as disagreements or termination of agreements could disrupt XOMA's strategic plans.
• Intellectual property protection: Protecting its intellectual property is vital for XOMA. Patent disputes or challenges to its patents could weaken its competitive advantage and impact its long-term value.

Strategic risks are also pertinent. Changes in market conditions, such as shifts in healthcare policies or economic downturns, can affect XOMA's business. The company must adapt to these changes while maintaining its strategic focus. Failure to do so could lead to missed opportunities and decreased profitability.

Mitigation strategies are essential for managing these risks. XOMA may employ several approaches, including:

• Diversifying its product pipeline: By investing in a range of drug candidates, XOMA can reduce its dependence on any single product.
• Strengthening its intellectual property portfolio: Actively pursuing and defending its patents can help XOMA maintain its competitive edge.
• Building strong partnerships: Collaborating with reputable partners can provide access to resources and expertise, spreading the risk and enhancing the potential for success.
• Implementing robust risk management practices: Regularly assessing and addressing potential risks can help XOMA proactively mitigate threats to its financial health.

Understanding these risk factors is crucial for investors looking to make informed decisions about XOMA. For more insights into the company's values and long-term goals, check out Mission Statement, Vision, & Core Values of XOMA Corporation (XOMA).

XOMA Corporation (XOMA) Growth Opportunities

XOMA Corporation, a biotechnology royalty aggregator, has a business model centered around acquiring royalty and milestone assets from licensed therapeutic candidates. This strategy enables biotech companies to receive immediate funding while XOMA Corporation gains potential future income from successful drugs.

Key aspects of XOMA Corporation's future growth prospects include:

• Product Approvals: Recent FDA approvals of drugs like OJEMDA™ and MIPLYFFA™ have positioned XOMA Corporation to potentially earn significant milestone payments and royalties.
• Portfolio Expansion: XOMA Corporation has been actively expanding its royalty and milestone portfolio. In 2024, it doubled its portfolio to over 120 assets through five transactions, including the acquisition of Kinnate Biopharma and Pulmokine Inc.
• Strategic Initiatives: XOMA Corporation has engaged in strategic transactions, such as a $15 million royalty monetization agreement with Twist Bioscience and a $22 million upfront payment to Daré Bioscience.

Analysis of key growth drivers:

• Product Innovations: XOMA Corporation focuses on novel immunological therapies and antibody technologies, with a pipeline of therapeutic candidates.
• Market Expansions: XOMA Corporation's partnerships and licensing agreements allow it to expand its market reach.
• Acquisitions: The acquisitions of Kinnate Biopharma and Pulmokine Inc. have added valuable assets to XOMA Corporation's portfolio.

Future revenue growth projections and earnings estimates:

• Total income and revenues for 2024 were $28.5 million, up from $4.8 million in 2023.
• Cash receipts for 2024 totaled $46.3 million, with $4.0 million in the fourth quarter alone.

Strategic initiatives or partnerships that may drive future growth:

• XOMA Corporation has a stock repurchase program to buy back up to $50 million worth of its shares.
• The company has strategic collaborations with biopharmaceutical companies and research institutions.
• XOMA Corporation's partnership with Roche on VABYSMO® holds potential for increasing long-term revenue streams.

Competitive advantages that position the company for growth:

• XOMA Corporation has a strong intellectual property portfolio, with 23 active patent families.
• The company has proven expertise in licensing and partnering pharmaceutical research.
• XOMA Corporation's business model focuses on acquiring and managing royalty income from various drug development partnerships.

Key events anticipated in 2025 include:

• Completion of enrollment in the sunRIZE Phase 3 clinical trial for ersodetug.
• Initiation of a Phase 3 study for seralutinib in pulmonary hypertension associated with interstitial lung disease.

XOMA Corporation's commercial royalty portfolio includes six assets, supported by VABYSMO®, OJEMDA™, and MIPLYFFA™. The Phase 3 portfolio totals 11 assets, promising key readouts in 2025.

XOMA Corporation stands to receive up to $25 million in milestone payments and earn a low to mid-single digit royalty on commercial sales of seralutinib.

Despite a net loss of $13.8 million for 2024, XOMA Corporation is optimistic about becoming cash flow positive in the near future. The company ended the year with a strong cash position of $106.8 million and deployed $65 million to acquire new milestone and royalty assets.

For more insights into XOMA Corporation's values, explore Mission Statement, Vision, & Core Values of XOMA Corporation (XOMA).