Phathom Pharmaceuticals, Inc. reported a loss of $0.15 per share for the quarter, which is better than the Zacks Consensus Estimate of $0.30. This loss has improved from last year’s loss of $1.32 per share, resulting in a surprise of +50.00%. In the previous quarter, Phathom expected a loss of $0.76 per share but reported a loss of $0.79, leading to a surprise of -3.95%. Over the last four quarters, Phathom has exceeded EPS estimates two times. Phathom’s quarterly revenue was $49.5 million, which was 0.64% higher than the Zacks Consensus Estimate. This is a substantial increase from $16.35 million last year. The company has beaten revenue estimates in all four quarters over the past year. Phathom’s stock has increased by about 66.6% since the beginning of the year, while the S&P 500 has risen by 17.2%. Phathom Pharmaceuticals currently has a Zacks Rank #3 (Hold). Looking ahead, the consensus EPS estimate for the next quarter is -$0.17, with expected revenues of $55.35 million. For the fiscal year, the estimate is -$2.31 with revenues of $172.56 million. Phathom is part of the Medical – Biomedical and Genetics industry, which is ranked in the top 38% of over 250 Zacks industries. VistaGen Therapeutics, another player in this field, is expected to report a quarterly loss of $0.51 per share. Phathom’s quarterly loss was much smaller than expected, which is a positive surprise. Revenue also grew significantly compared to the same period last year, surpassing estimates. With the uncertainty before this report now resolved, we anticipate options prices to decrease as implied volatility falls. Given the substantial 66.6% gain in Phathom’s stock in 2025, this positive report could lead to further gains. Traders who believe the stock will remain steady or increase might consider selling out-of-the-money put options. This strategy allows for premium collection while benefiting from the anticipated drop in volatility. The impressive rise in revenue from $16.35 million to $49.5 million year-over-year is primarily due to strong demand for their key products. Recent prescription data from the third quarter of 2025 indicates a 25% increase in new scripts, reflecting robust market acceptance. This growth supports a positive outlook for the stock. However, it’s important to note that the company is still not profitable and carries a neutral “Hold” rating, which suggests the stock may trade within a limited range after the initial earnings report. A strategy like an iron condor could be effective, as it profits from the stock remaining between two price points while also taking advantage of the post-earnings decline in volatility. Attention will now shift to management’s forward guidance and the earnings estimates for the upcoming quarter, which are predicting another loss. A similar situation was seen in the early 2020s with companies launching new products, where initial excitement was later dampened by the long journey to profitability. Thus, any indications of worsening losses or slowing revenue growth in their forecast could quickly change the current positive sentiment.

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