Why Nektar Therapeutics Stock Popped 6% on Friday

Key Points

• Investors were reacting to the biotech's second-quarter earnings report.

• Revenue was higher than analysts expected, although the net loss was deeper than the consensus.

• 10 stocks we like better than Nektar Therapeutics ›

Biotech Nektar Therapeutics (NASDAQ: NKTR) unveiled its latest quarterly earnings after the stock market's close on Thursday, and the investor reaction was strong the following day. Happily for Nektar, it was largely positive, and the share price increased by 6% today. This was well higher than the 0.8% gain posted by the S&P 500 index.

Sweet results

In its second quarter, Nektar booked total revenue of just under $11.2 million, which was less than half of the nearly $23.5 million in the same period of 2024. All of this derived from noncash royalty revenue connected to the sales of future royalties. This isn't unusual for a biotech without a commercialized product that depends on royalties and other payouts from partners.

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Nektar added that its cash and investments in marketable securities stood at just under $176 million at the end of the quarter (June 30). That, plus the roughly $107.5 million it should reap from a recent secondary share issue, should fund its operations into the first quarter of 2027.

Meanwhile, the company's net loss for the second quarter was slightly over $39 million, or $2.78 per share.

On average, analysts were projecting Nektar would book $9.7 million in revenue and a net loss of only $0.20 per share. I should note here that it can be challenging for even the most experienced professionals to estimate the results of biotechs that don't draw meaningful revenue from commercialized products.

On a fast track

All that said, there are several potential tailwinds for Nektar just now, and the company wasn't shy about itemizing them in its earnings release. Among the more promising is the U.S. Food and Drug Administration granting its Fast Track designation for rezpegaldesleukin, Nektar's investigational drug targeting severe-to-very-severe alopecia areata (a skin disorder).

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Eric Volkman has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.