1. What Happened?: Q1 2025 Earnings Summary

Orient Bio reported KRW 7.6 billion in revenue for Q1 2025, a 4% YoY increase. However, the company recorded an operating loss of KRW 1.6 billion and a net loss of KRW 2 billion. A sharp rise in the cost of goods sold (COGS) to 90.3% was a primary driver of the profit decline.

2. Why Did This Happen?: Analyzing the Earnings Shift

Despite steady growth in the biomaterials business, rising raw material prices and supply chain instability contributed to a substantial increase in COGS. Although financial expenses decreased significantly YoY, it wasn’t enough to offset the impact of the lower gross profit.

3. What’s Next?: Investor Action Plan

Short-term, investors should closely monitor Orient Bio’s profitability improvement efforts. Analyze the company’s cost reduction strategies and their effectiveness, and pay close attention to COGS trends in future earnings releases. Long-term, keep an eye on the progress and potential commercialization of its new drug development, particularly the hair loss treatment candidate OND-1. The current earnings are likely to negatively impact the stock price, so a cautious approach is recommended until clear signs of a turnaround emerge.

4. Business Segment Analysis

  • Biomaterials Business: Maintaining stable growth. Improving COGS is a key challenge.
  • R&D: Continued investment in the development of hair loss treatment candidate OND-1. Progress demonstrated through primate toxicity testing contract.