Arrowhead Pharmaceuticals (ARWR) stock plummeted 6.63% in pre-market trading on Tuesday, following the release of its disappointing fiscal Q1 2025 earnings results.

While the company reported positive developments such as a significant collaboration agreement with Sarepta Therapeutics and a strong potential catalyst calendar for 2025, investors were likely concerned about the following factors:

• Net loss widened to $173.1 million or $1.39 per share for the quarter, compared to a net loss of $132.9 million in the prior-year period.
• Revenue declined to $2.5 million from $3.6 million in the same quarter last year.
• Operating expenses increased significantly, primarily due to higher candidate costs and salaries as its pipeline advanced.
• Despite the cash influx from the Sarepta deal, Arrowhead still needs additional capital to initiate a crucial cardiovascular outcomes trial (CVOT) for its lead candidate plozasiran.

While the company highlighted its robust pipeline and potential growth drivers, such as plozasiran, obesity, and CNS candidates, the disappointing financial results and need for additional funding likely weighed on investor sentiment, leading to the pre-market selloff.