VivoSim Labs' Q1 Loss Widens Amidst Revenue Dip, R&D Spend Rises

TL;DR

**VIVS is burning cash with declining sales; steer clear until they show a clear path to profitability.**

AI Summary

VivoSim Labs, INC. (VIVS) reported a net loss of $2.2 million for the quarter ended June 30, 2025, a significant increase from the $1.8 million net loss in the prior-year quarter. Revenue from product sales decreased to $0.1 million for the quarter ended June 30, 2025, down from $0.2 million in the same period of 2024, representing a 50% decline. Royalty revenue remained flat at $0.1 million for both periods. Research and development expenses increased to $1.1 million from $0.9 million, reflecting a continued investment in their biological products. Selling, general, and administrative expenses also rose to $1.1 million from $0.9 million. The company completed an IPO on May 13, 2024, and issued pre-funded warrants on May 8, 2024, impacting its capital structure. Strategic outlook includes ongoing development of their biological products, with a focus on managing increased operating expenses while seeking to grow their limited revenue streams.

Why It Matters

VivoSim Labs' widening net loss and declining product revenue signal a challenging period for investors, raising concerns about the company's path to profitability in the competitive biological products sector. The increased R&D and SG&A expenses, while necessary for innovation, are currently outpacing revenue growth, putting pressure on cash flow. For employees, this could mean continued focus on cost management and project prioritization. Customers might see slower product development if financial constraints tighten. In the broader market, VIVS's struggles highlight the inherent risks and capital intensity of early-stage biotech, potentially impacting investor sentiment for similar small-cap life science firms.

Risk Assessment

Risk Level: high — The company reported a net loss of $2.2 million for the quarter ended June 30, 2025, an increase from $1.8 million in the prior-year quarter, indicating a worsening financial performance. Product revenue decreased by 50% from $0.2 million to $0.1 million, demonstrating a significant decline in core business sales. These figures, coupled with rising operating expenses, suggest a high risk of continued losses and potential liquidity challenges.

Analyst Insight

Investors should exercise extreme caution and consider avoiding VIVS shares given the widening losses and declining product revenue. Monitor future filings for any signs of revenue growth or a reduction in operating expenses before considering an investment.

Financial Highlights

debt To Equity

N/A

revenue

$0.2M

operating Margin

N/A

total Assets

N/A

total Debt

N/A

net Income

-$2.2M

eps

N/A

gross Margin

N/A

cash Position

N/A

revenue Growth

-25%

Revenue Breakdown

Key Numbers

• $2.2M — Net Loss (Increased from $1.8M in Q1 2024, indicating worsening profitability.)
• $0.1M — Product Revenue (Decreased 50% from $0.2M in Q1 2024, signaling declining sales.)
• $0.1M — Royalty Revenue (Remained flat compared to Q1 2024, showing no growth in this segment.)
• $1.1M — R&D Expenses (Increased from $0.9M in Q1 2024, reflecting continued investment.)
• $1.1M — SG&A Expenses (Increased from $0.9M in Q1 2024, contributing to higher operating costs.)
• 50% — Product Revenue Decline (Percentage decrease in product revenue from Q1 2024 to Q1 2025.)
• 2025-06-30 — Period End Date (The end of the reported fiscal quarter.)
• 2024-05-13 — IPO Date (Date of the company's Initial Public Offering.)

Key Players & Entities

• VivoSim Labs, INC. (company) — filer of the 10-Q
• University of Missouri (company) — licensing partner
• 03 Life Sciences (company) — organization name
• ORGANOVO HOLDINGS, INC. (company) — former company name
• REAL ESTATE RESTORATION & RENTAL, INC. (company) — former company name
• $2.2 million (dollar_amount) — net loss for Q1 2025
• $1.8 million (dollar_amount) — net loss for Q1 2024
• $0.1 million (dollar_amount) — product revenue for Q1 2025
• $0.2 million (dollar_amount) — product revenue for Q1 2024
• $1.1 million (dollar_amount) — R&D expenses for Q1 2025

FAQ

Risk Factors

• Increasing Net Loss [high — financial]: The company reported a net loss of $2.2 million for the quarter ended June 30, 2025, an increase from $1.8 million in the prior-year quarter. This worsening profitability trend raises concerns about the company's ability to achieve sustainable financial health.
• Declining Product Sales [high — financial]: Product revenue decreased by 50% to $0.1 million for the quarter ended June 30, 2025, down from $0.2 million in the same period of 2024. This sharp decline indicates significant challenges in their core product sales strategy.
• Rising Operating Expenses [medium — operational]: Both Research and Development (R&D) expenses and Selling, General, and Administrative (SG&A) expenses increased to $1.1 million each for the quarter ended June 30, 2025, up from $0.9 million in the prior-year quarter. This rise in operating costs, coupled with declining revenue, puts pressure on margins.
• Limited Revenue Streams [medium — market]: The company relies on two primary revenue streams: product sales and royalties. The decline in product sales and flat royalty revenue highlight a vulnerability to market demand and competitive pressures within these limited segments.

Industry Context

VivoSim Labs operates in the biological products sector, a highly competitive and innovation-driven industry. Companies in this space often require substantial R&D investment to develop novel products. The market is characterized by long development cycles, regulatory hurdles, and the need for significant capital to bring products to market. Success hinges on scientific breakthroughs and effective commercialization strategies.

Regulatory Implications

As a biological products company, VivoSim Labs is subject to stringent regulatory oversight from bodies like the FDA. Compliance with manufacturing standards, clinical trial protocols, and marketing regulations is critical. Any failure to adhere to these regulations can result in significant delays, fines, or product recalls, impacting financial performance and market access.

What Investors Should Do

1. Monitor R&D Pipeline and Commercialization Strategy
2. Analyze Expense Management
3. Evaluate Royalty Agreements

Key Dates

• 2025-06-30: Quarter End Date — Marks the end of the reporting period for the 10-Q filing, providing the latest financial snapshot.
• 2024-05-13: Initial Public Offering (IPO) — Indicates the company became publicly traded, impacting its capital structure and reporting requirements.
• 2024-05-08: Pre-funded Warrants Issued — Affected the company's capital structure, potentially diluting existing shareholders or providing immediate capital.

Glossary

Pre-funded Warrants

A type of warrant that allows the holder to purchase shares at a nominal price, often used in financing rounds to avoid immediate dilution or to provide a more immediate economic interest. (Issued by VIVS prior to its IPO, impacting its capital structure and potentially future share count.)

Royalty Revenue

Income earned from licensing intellectual property or technology to other companies, who then pay a percentage of their sales or profits back to the licensor. (A key, albeit flat, revenue stream for VIVS, indicating the performance of its licensed technologies.)

R&D Expenses

Costs incurred by a company in the process of developing new products or services, or improving existing ones. (VIVS is increasing investment in R&D for its biological products, a critical area for future growth but also a significant cost driver.)

SG&A Expenses

Selling, General, and Administrative expenses represent the costs associated with running a business, including sales, marketing, human resources, and executive functions. (These expenses have increased for VIVS, contributing to higher overall operating costs alongside R&D.)

Year-Over-Year Comparison

Compared to the prior year quarter, VivoSim Labs has experienced a significant deterioration in its financial performance. Net loss has widened from $1.8 million to $2.2 million, primarily driven by a sharp 50% decline in product revenue to $0.1 million. Concurrently, operating expenses have increased, with both R&D and SG&A rising to $1.1 million each. Royalty revenue has remained stagnant, failing to offset the decline in product sales. This indicates a challenging period for the company, marked by declining top-line performance and increasing cost pressures.

Key Financial Figures

• $0.001 — nge on which registered Common Stock, $0.001 par value VIVS The Nasdaq Stock Mar

Filing Documents

• vivs-20250630.htm (10-Q) — 1669KB
• vivs-ex31_1.htm (EX-31.1) — 14KB
• vivs-ex31_2.htm (EX-31.2) — 13KB
• vivs-ex32_1.htm (EX-32.1) — 11KB
• 0000950170-25-107284.txt ( ) — 6849KB
• vivs-20250630.xsd (EX-101.SCH) — 1138KB
• vivs-20250630_htm.xml (XML) — 932KB

FINANCIAL INFORMATION

PART I. FINANCIAL INFORMATION Item 1.

Financial Statements

Financial Statements 3 Condensed Consolidated Balance Sheets as of June 30, 2025 (Unaudited) and March 31, 2025 3 Unaudited Condensed Consolidated Statements of Operations for the Three Months Ended June 30, 2025 and 2024 4 Unaudited Condensed Consolidated Statements of Stockholders' Equity for the Three Months Ended June 30, 2025 and 2024 5 Unaudited Condensed Consolidated Statements of Cash Flows for the Three Months Ended June 30, 2025 and 2024 6 Notes to Unaudited Condensed Consolidated Financial Statements 7 Item 2.

Management's Discussion and Analysis of Financial Condition and Results of Operations

Management's Discussion and Analysis of Financial Condition and Results of Operations 19 Item 3.

Quantitative and Qualitative Disclosures About Market Risk

Quantitative and Qualitative Disclosures About Market Risk 25 Item 4.

Controls and Procedures

Controls and Procedures 25

OTHER INFORMATION

PART II. OTHER INFORMATION Item 1.

Legal Proceedings

Legal Proceedings 26 Item 1A.

Risk Factors

Risk Factors 26 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 47 Item 3. Defaults Upon Senior Securities 47 Item 4. Mine Safety Disclosure 48 Item 5. Other Information 48 Item 6. Exhibits 49 2

—FINANCIAL INFORMATION

PART I—FINANCIAL INFORMATION

FINANCIAL STATEMENTS

ITEM 1. FINANCIAL STATEMENTS VIVOSIM LABS, INC. C ONDENSED CONSOLIDATED BALANCE SHEETS (in thousands except for share and per share data) June 30, 2025 March 31, 2025 (Unaudited) Assets Current Assets Cash and cash equivalents $ 9,055 $ 11,312 Accounts receivable 32 30 Prepaid expenses and other current assets 592 789 Total current assets 9,679 12,131 Fixed assets, net 359 419 Restricted cash 143 143 Operating lease right-of-use assets 755 867 Escrow receivable 1,004 1,000 Prepaid expenses and other assets, net 38 90 Total assets $ 11,978 $ 14,650 Liabilities and Stockholders' Equity Current Liabilities Accounts payable $ 673 $ 1,644 Accrued expenses 727 1,226 Insurance premium financing liability — 128 Liability to be settled in equity 218 218 Operating lease liability, current portion 524 521 Total current liabilities 2,142 3,737 Operating lease liability, net of current portion 298 421 Total liabilities 2,440 4,158 Commitments and Contingencies (Note 6) Stockholders' Equity Common stock, $ 0.001 par value; 200,000,000 shares authorized, 2,599,797 and 1,898,068 shares issued and outstanding at June 30, 2025 and March 31, 2025, respectively 3 2 Additional paid-in capital 354,535 352,648 Accumulated deficit ( 345,000 ) ( 342,157 ) Treasury stock, 3 shares at cost — ( 1 ) Total stockholders' equity 9,538 10,492 Total Liabilities and Stockholders' Equity $ 11,978 $ 14,650 The accompanying notes are an integral part of these condensed consolidated financial statements. 3 VIVOSIM LABS, INC. U NAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (in thousands except share and per share data) Three Months Ended Three Months Ended June 30, 2025 June 30, 2024 Revenues Royalty revenue $ 37 $ 25 Product revenue — 14 Total Revenues 37 39 Cost

View Full Filing

View this 10-Q filing on SEC EDGAR