Harrow, Inc. Reports 38.3% Revenue Growth but Wider Net Loss in Q1 2025

Harrow, Inc. reported significant financial results for the first quarter of 2025, with total revenues reaching $47.8 million, a 38.3% increase from $34.6 million in the same period of 2024. The growth was primarily driven by a substantial rise in product sales, which amounted to $47.7 million, compared to $34.5 million a year earlier. However, the company also reported a net loss of $17.8 million, widening from a loss of $13.6 million in the prior year, resulting in a basic and diluted net loss per share of $0.50, compared to $0.38 in the previous year.

The company's balance sheet as of March 31, 2025, showed total assets of $364.2 million, down from $389.0 million at the end of 2024. Current assets decreased to $169.5 million, primarily due to a significant reduction in accounts receivable, which fell to $77.1 million from $116.4 million. Current liabilities surged to $187.0 million, largely due to the current portion of notes payable, which increased to $108.3 million, reflecting the company's ongoing debt obligations.

Strategically, Harrow has initiated several key developments, including the launch of the "VEVYE Access for All" program aimed at improving patient access to its products. Additionally, the company is transitioning approximately 25,000 patients from its compounded formulation, Klarity-C, to its FDA-approved product, VEVYE, as part of its "Project Beagle." This initiative is expected to streamline operations and enhance product offerings while phasing out certain compounded products.

Operationally, Harrow's workforce has expanded, contributing to increased selling, general, and administrative expenses, which rose to $40.5 million from $28.8 million year-over-year. The company also reported a gross profit of $32.3 million, with a gross margin of 67.5%, down from 69.5% in the previous year, attributed to higher fixed costs and amortization related to product launches. The company’s cash position improved to $66.7 million, up from $47.2 million at the end of 2024, providing a buffer for ongoing operations and potential strategic investments.

Looking ahead, Harrow is focused on refinancing its existing debt, including the Oaktree Loan and 2026 Notes, which are due in January and April 2026, respectively. Management is optimistic about securing favorable refinancing terms based on the company's collateral strength and expected cash flows. However, they acknowledge the potential need to sell assets if refinancing efforts do not materialize as planned. The company remains committed to expanding its product portfolio and enhancing operational efficiencies to drive future growth.