Ironwood Pharma Stock Draws Retail Investor Ire With Big Q1 Miss And No Earnings Call

Ironwood Pharmaceuticals shares dropped 14.6% on Wednesday after the company reported a steep revenue miss in the first quarter, attributing the shortfall to a timing shift in rebates related to its gastrointestinal drug Linzess. 

The company maintained its full-year guidance and noted progress on a strategic review and pipeline development.

The stock closed at $0.79, down $0.13 on Wednesday, and remained flat in after-hours trading.

Ironwood posted Q1 2025 revenue of $41.1 million, down from $74.9 million a year earlier and well below the $56.7 million consensus estimate. 

GAAP net loss widened to $37.4 million, or $0.23 per share, compared to $0.03 per share in the year-ago quarter. Non-GAAP net loss came in at $0.14 per share.

The company attributed the revenue decline to a change in gross-to-net rebate reserve estimates from partner AbbVie, which impacted the phasing of Linzess's U.S. net sales but is not expected to affect full-year results. 

Collaboration revenue related to Linzess dropped 46% year-over-year to $38.8 million.

Ironwood reaffirmed its 2025 U.S. Linzess net sales forecast of $800 million to $850 million and raised its adjusted EBITDA outlook to over $105 million. 

Prescription demand for Linzess rose 8% year-over-year in Q1, in line with expectations. The company ended the quarter with $108.5 million in cash and cash equivalents, up from $88.6 million at year-end.

Management said it will focus on maximizing shareholder value, including through a planned confirmatory Phase 3 trial for apraglutide and an ongoing strategic alternatives review with Goldman Sachs.

Analyst sentiment soured as Wells Fargo downgraded the company to 'Equalweight' from 'Overweight,' slashing its price target from $7 to $1, according to Koyfin.

Similarly, Jefferies downgraded Ironwood to 'Hold' from 'Buy,' lowering its target from $8 to $0.70, Koyfin data said. 

On Stocktwits, sentiment was ‘bearish’ amid ‘normal’ message volume. 

Some users criticized the lack of an earnings call, with one remarking that the company simply dropped the earnings release without discussion — a departure from its decade-long tradition — and instead chose to present at a life sciences conference later in the day. 

Another user noted there was little new information in the earnings release beyond what had already been disclosed on April 25, saying they took advantage of the post-earnings selloff to add shares at a 12% discount.

Shares of Ironwood have fallen 81.7% so far this year.

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