OPKO Health (NASDAQ:OPK) saw its shares climb sharply in after-hours trading Monday after the company reported second-quarter earnings that significantly exceeded Wall Street expectations. The stock, which had risen 1.6% to close at $1.24 in regular trading, added approximately 8% after the release.
The revenue beat was substantial: Q2 revenue came in at $163.5 million, surpassing the consensus estimate of $131.23 million by $32.35 million. However, nearly 91% of that upside—or $29.4 million—was tied to Nicoya preferred shares, a payment linked to a Greater China licensing amendment. This raised questions about the quality of the revenue beat, as much of it was non-recurring.
Despite the Nicoya-related boost, OPKO also delivered operational improvements. The operating loss narrowed to $7 million from $60 million a year ago, and the net loss dropped to $8.4 million from $148.4 million, which had included a $91.7 million note-exchange charge. Management raised its full-year 2026 revenue guidance to a range of $560 million to $585 million, up from the prior estimate of $530 million to $560 million.
The updated guidance reflects a $27.5 million increase at the midpoint, entirely from the intellectual property and other revenue segment. Services revenue was trimmed slightly, while product revenue saw a modest gain. Excluding the Nicoya contribution, the midpoint of the new guidance would be $543.1 million, slightly below the previous midpoint of $545 million.
Cost improvements were also notable. OPKO reduced its full-year expense outlook to between $710 million and $740 million, down from $725 million to $750 million. However, nearly 90% of the year-over-year operating improvement came from two transaction-related items: the Nicoya income and an $18.1 million earnout from Labcorp Holdings Inc. (NYSE:LH).
On the product side, recurring lines showed strength. Product revenue rose 5.4% to $42.9 million, with Rayaldee up 12.5% to $8.1 million and the NGENLA profit share from Pfizer Inc. (NYSE:PFE) increasing 4.9% to $6.4 million. Core diagnostics revenue, however, slipped to $68.2 million from $69.3 million, while 4Kscore revenue fell to $6.3 million from $6.9 million.
Looking ahead, OPKO expects Q3 revenue of $131 million to $142 million, with the midpoint representing a 16.5% decline from Q2. On a pro forma basis excluding Nicoya, that would be about 1.8% above the prior quarter. The company ended June with $314.4 million in cash, securities, and restricted cash, roughly a third of its current market cap. It also has $94.7 million remaining for share buybacks, about 10% of market value.
Key upcoming milestones include the completion of enrollment for MDX2301 in Q3 2026 and the planned initiation of a Phase 1 in vivo CAR-T trial in late 2026 or early 2027. Risks remain, including reliance on transaction-related income and several major drug programs still in Phase 1.
