Xeris Q2 2026 earnings: Recorlev drives 29% revenue growth

Xeris Biopharma (Nasdaq: XERS) reported Q2 2026 total revenue of $92.1 million, up 29% from $71.5 million, while its diluted GAAP loss per share widened to $0.18 from $0.01. Recorlev drove product growth, and favorable product mix lifted gross margin to 86%. Adjusted EBITDA improved, but a roughly $31 million noncash charge tied to the convertible-note exchange pushed the company to a $31.1 million net loss.

Core earnings data

Net product revenue increased 34% to $91.0 million, accounting for nearly all quarterly revenue. Operating income remained positive, although higher commercial and development spending limited the benefit from revenue growth and the four-percentage-point improvement in gross margin.

The GAAP net loss was dominated by a one-time, noncash convertible-note charge rather than an operating loss. Non-GAAP adjusted EBITDA increased by $6.7 million to $19.3 million.

Product performance

Recorlev was the clear growth driver, with net revenue rising 81% as patient demand increased. Gvoke declined from the prior-year quarter despite sequential improvement cited by management, while Keveyis remained broadly stable.

Recorlev’s $25.3 million revenue increase exceeded the entire $23.3 million increase in net product revenue, offsetting the declines in Gvoke and other product revenue. This makes continued Recorlev demand particularly important to Xeris’ overall growth rate.

Favorable mix lifted gross margin, but expansion spending limited operating leverage

Management attributed the gross-margin improvement to favorable product mix. However, SG&A expense increased 37% to $61.0 million, mainly because of personnel and commercial investments supporting the Recorlev expansion. R&D expense rose 32% to $10.7 million, reflecting personnel costs for XP-8121 and other external spending.

As a result, operating income increased only modestly to $5.2 million, and the operating margin declined to approximately 5.6% from 6.3%. The company therefore generated better adjusted EBITDA but did not yet convert its revenue and gross-margin gains into stronger GAAP operating leverage.

The difference between the $31.1 million GAAP net loss and $19.3 million of adjusted EBITDA included a $30.8 million loss on debt extinguishment and $11.1 million of share-based compensation, as well as interest and depreciation adjustments. The debt-related charge was noncash and one-time, but share-based compensation was also substantially higher than the prior year’s $5.0 million.

Balance sheet and convertible-note exchange

Xeris ended June with $121.7 million in cash and cash equivalents, up from $111.0 million at the end of 2025. Inventory increased to $80.9 million from $68.7 million, while current liabilities rose to $189.6 million from $109.6 million, including $63.8 million classified as the current portion of long-term debt. The company reported a $9.7 million stockholders’ deficit at June 30, compared with $13.7 million of positive equity at year-end.

The June 30 balance sheet does not fully reflect the convertible-note transactions completed in July. Xeris said the exchange eliminated approximately $23.0 million of debt using $23.0 million in cash and roughly 5.0 million common shares. The remaining $10.5 million of principal was converted into approximately 3.6 million shares, leaving no 2028 Convertible Notes outstanding. Total shares outstanding were 182.3 million as of July 31, 2026.

Full-year 2026 guidance

Xeris tightened its full-year total revenue guidance to $385 million-$390 million. Based on first-half revenue of $175.2 million, reaching that range requires approximately $209.8 million-$214.8 million of second-half revenue, about 20%-23% more than the first-half total.

The implied second-half figures are calculated from company guidance and reported first-half revenue; they are not separate management guidance.

Patent and pipeline developments

Xeris received a Notice of Allowance for a new Keveyis patent that, once granted, is expected to extend intellectual-property protection through at least 2039. The USPTO also granted a second patent for XP-8121 on July 28. Management plans to provide an overview of the XP-8121 Phase 3 program on September 9, with the Phase 3 study expected to begin later in 2026.

Recent insider transactions

During the past six months, insiders purchased 245,372 shares across eight transactions and sold 295,667 shares across 12 transactions. That represents net sales of 50,295 shares, equivalent to 0.9% of the reported 5.7 million shares held by insiders.

The ten most recent reported events include seven sales and three stock awards. These records describe the transactions but do not, by themselves, establish insiders’ views of Xeris’ outlook.

Risks investors need to watch

• Dependence on Recorlev: Recorlev generated more incremental revenue than the portfolio as a whole, while Gvoke declined and Keveyis grew only slightly. Any slowdown in Recorlev demand would have an outsized effect on company growth.
• Elevated operating spending: SG&A and R&D grew faster than revenue, causing operating margin to decline despite the improved gross margin. Continued investment without corresponding revenue growth could further constrain operating leverage.
• Higher second-half revenue requirement: The full-year guidance range implies second-half revenue must be approximately 20%-23% above the first-half total, increasing reliance on Recorlev’s commercial momentum and management’s expansion investments.
• Capital-structure and dilution effects: Eliminating the 2028 Convertible Notes reduced debt but required cash and the issuance of approximately 8.6 million shares. The transaction also created significant volatility in Q2 GAAP earnings through the noncash fair-value charge.

Summary

Xeris’ second quarter combined rapid Recorlev growth, a higher gross margin and improved adjusted EBITDA with a sharply wider GAAP loss caused primarily by the convertible-note charge. The central operating question is whether Recorlev can sustain enough momentum to meet the higher implied second-half revenue requirement while commercial and development spending remains elevated. Investors should also monitor Gvoke’s performance, XP-8121 development and the balance-sheet and dilution effects of the completed note exchange.