ArQule Earnings: Here’s Why Investors are Excited Now

ArQule Inc. (NASDAQ:ARQL) had a loss and beat Wall Street’s expectations, AND beat the revenue expectation. The revenue beat is a positive sign to shareholders seeking high growth out of the company. Shares are up 2.46%.

ArQule Inc. Earnings Cheat Sheet

Results: Adjusted Earnings Per Share increased to $-0.11 in the quarter versus EPS of $-0.01 in the year-earlier quarter.

Revenue: Decreased 62.81% to $4.4 million from the year-earlier quarter.

Actual vs. Wall St. Expectations: ArQule Inc. reported adjusted EPS loss of $0.11 per share. By that measure, the company beat the mean analyst estimate of $-0.12. It beat the average revenue estimate of $3.84 million.

Quoting Management: “Data from a randomized, placebo-controlled, double-blind, Phase 2 clinical trial with tivantinib in combination with cetuximab and irinotecan in patients with relapsed or refractory KRAS wild-type metastatic CRC were presented at the 2013 ASCO Annual Meeting,” said Paolo Pucci, chief executive officer of ArQule. “These data analyses identified signals of clinical benefit in trends toward improved PFS, ORR and OS.
“We are pleased to report that well over one half of the clinical sites participating in our pivotal Phase 3 METIV-HCC trial have been opened,” said Mr. Pucci. “Significant interest among clinical investigators is fueling momentum in patient screening at centers in Europe and the U.S.
“We expect that today’s announced workforce reduction and a number of additional cost containment initiatives will extend our financial runway into 2016,” said Mr. Pucci. “While we retain our core discovery capabilities we have now created the financial flexibility to continue to develop our proprietary pipeline. These combined actions serve to harmonize our financial timeline with anticipated clinical development milestones.”

Key Stats (on next page)…

Revenue decreased 22.26% from $5.66 million in the previous quarter. EPS increased to $-0.11 in the quarter versus EPS of $-0.09 in the previous quarter.

Looking Forward: Analysts have a neutral outlook for the company’s next-quarter performance. Over the past three months, the average estimate for next quarter’s earnings is a loss of $0.12 and has not changed. For the current year, the average estimate has moved up from a loss of $0.48 to a loss of $0.45 over the last ninety days.

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(Company fundamentals provided by Xignite Financials. Email any earnings discrepancies to earnings [at] wallstcheatsheet.com)

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