10-Q · May 7, 2026
In Q1 2026, Harmony Biosciences achieved a revenue of $215.4 million, marking a 16.6% increase from the previous year. Net income was reported at $32.5 million, which, while lower than last year's $45.6 million due to…
Earnings analysis · 10-Q
HRMY earnings analysis
Filed August 4, 2026 · Our reading of the company's report
The latest report
Harmony delivered strong Q2 growth, with net product revenue up 30.3% year over year to $261.280 million and operating income up to $89.316 million from $48.180 million. Diluted EPS increased to $1.28, while operating…
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Harmony delivered strong Q2 growth, with net product revenue up 30.3% year over year to $261.280 million and operating income up to $89.316 million from $48.180 million. Diluted EPS increased to $1.28, while operating margin expanded to 34.2%, although gross margin declined to 75.8% as royalty costs increased. Liquidity remains substantial at $962.5 million of cash, cash equivalents and investments, supporting a pipeline with meaningful 2027 clinical and regulatory catalysts.
Gross and operating margin
How much of each revenue dollar the business keeps.
One point per quarterly or annual filing. Both margins are shares of that report's revenue.
From revenue to operating profit
Where each $100 of revenue went in this report.
Cost of sales, operating expenses, and what remained. Figures are rounded to whole dollars.
How we read each report
Our analysis across the last few reports.
Our model's reading of each filing, not the share price or the market's reaction. Annual and quarterly reports each occupy one position.
Reported figures
- Earnings per share
- $1.28
- Segment
- WAKIX / net product revenue: $261.280 million, up $60.791 million (30.3%) year over year; Harmony reports a single commercial product-revenue stream.
What stood out
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Revenue accelerated to $261.3 million
Q2 net product revenue rose $60.8 million, or 30.3% year over year, to $261.280 million. This also represents a $46.280 million, or roughly 21.5%, sequential increase from $215 million in Q1 2026.
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Gross margin compressed despite growth
Gross margin was 75.8% ($198.082 million gross profit on $261.280 million revenue), down from 79.3% in Q1 2026 and 81.0% in Q2 2025. The decline reflected cost of product sold rising 65.6% to $63.198 million, principally from higher royalties.
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Operating leverage drove EPS expansion
Operating income increased to $89.316 million from $48.180 million a year earlier, lifting operating margin to 34.2% from 24.0%; it also improved from 17.3% in Q1 2026. Diluted EPS of $1.28 rose from $0.68 in Q2 2025 and $0.55 in Q1 2026.
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WAKIX demand and pricing supported growth
WAKIX volume remained strong: units shipped increased 26.5%, average patients reached approximately 8,950, and the January 2026 7% price increase was partly offset by approximately 4.0% higher rebates.
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Strong operating cash flow and liquidity
Six-month operating cash flow increased to $120.192 million from $113.314 million. Cash, cash equivalents and investments totaled $962.5 million at June 30, 2026, versus $155.0 million of outstanding debt.
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Multiple pipeline catalysts moved forward
Pipeline catalysts advanced: the Pitolisant GR NDA was accepted with an April 1, 2027 PDUFA date, while BP-205 Phase 1b is planned for Q3 2026 with topline data expected in early 2027.
What to watch
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Royalty burden is pressuring gross margin
Gross margin fell to 75.8% from 81.0% in Q2 2025 as cost of product sold increased 65.6% to $63.198 million. Management attributes the higher cost ratio to new royalties under the Novitium License Agreement.
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Receivables and working capital consumed cash
Operating cash flow of $120.192 million was reduced by a $45.4 million increase in net working capital excluding cash, primarily from higher accounts receivable and lower accrued expenses. This is materially larger than the $12.4 million working-capital increase in the prior-year six-month period.
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Debt maturity and prior covenant-default history
The company has $155.0 million of term-loan borrowings, including a $115.0 million maturity payment due July 26, 2028. An event of default dating to July 2025 was waived on May 4, 2026, although management states it was compliant with covenants at June 30, 2026.
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Pipeline value depends on 2027-28 milestones
Pipeline execution remains long dated: management expects Phase 3 topline data for TEMPO, Pitolisant HD and EPX-100 programs in 2027, with anticipated target PDUFA dates for Pitolisant HD and EPX-100 in 2028. These timelines leave the business reliant on WAKIX in the interim.
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No formal risk-factor update; licensing commitments grow
The filing states there were no material changes to risk factors disclosed in the 2025 Form 10-K. However, management disclosed $32.0 million of 2026 upfront license fees and a required $25.0 million MSN patent-approval escrow deposit within nine months of February 25, 2026.
Management's outlook
The 10-Q does not provide explicit quantitative revenue or EPS guidance. Management cites an April 1, 2027 PDUFA target for Pitolisant GR, expected BP-205 Phase 1b topline data in early 2027, and expected 2027 topline data for several late-stage programs.
Earlier filings 4
10-K · February 24, 2026
Harmony reported net product revenue for WAKIX of $868.5 million for the year ended December 31, 2025 and an average of approximately 8,500 patients on WAKIX in Q4 2025. Clinical and regulatory progress includes…
10-Q · August 5, 2025
In Q2 2025, Harmony Biosciences reported revenue of $200.5 million, a 15.9% increase from $172.8 million in Q2 2024. Gross margin dipped slightly to 81.0%, with a notable decrease in operating margin to 24.0%. EPS was…
10-Q · October 29, 2024
Harmony reported Q3 net product revenue of $186,038,000 (up $25,770,000 or 16.1% vs Q3 2023) and diluted EPS of $0.79 (up $0.16 vs $0.63). Gross margin compressed to 77.0% while operating income declined to $61,710,000.…
This is our reading of a public filing, not the filing itself. Analysis can contain errors; check the source document for full context.