third quarter 2026
Filed Nov 2, 2026Krystal Biotech Announces Third Quarter 2026 Financial and Operating Results
VYJUVEK net product revenue increased 30% to $127.3 million, the company reported $63.1 million of quarterly net income, and cash, cash equivalents and investments totaled $1.2 billion. The results were offset by lower net income than the prior-year quarter and slower-than-anticipated enrollment in the KB801 EMERALD-1 study.
Key metrics
shortened, hover for the filing’s print| Metric | Value | q/q | y/y |
|---|---|---|---|
| Product revenue, net, three months ended September 30GAAP | $127.3M | – | 30% |
| Cost of goods sold, three months ended September 30GAAP | 7.56M | – | 3,293 (in thousands) |
| Research and development, three months ended September 30GAAP | 14.89M | – | 306 (in thousands) |
| Stock-based compensation in research and development, three months ended September 30GAAP | $2.6M | – | – |
| Selling, general, and administrative, three months ended September 30GAAP | 33.75M | – | (3,829) (in thousands) |
| Stock-based compensation in selling, general, and administrative, three months ended September 30GAAP | $11.3M | – | – |
| Total operating expenses, three months ended September 30GAAP | 56.20M | – | (230) (in thousands) |
| Income from operations, three months ended September 30GAAP | 71.14M | – | 29,771 (in thousands) |
| Interest and other income, net, three months ended September 30GAAP | 9M | – | 2,407 (in thousands) |
| Income before income taxes, three months ended September 30GAAP | 80.14M | – | 32,178 (in thousands) |
| Income tax (expense) benefit, three months ended September 30GAAP | −17.08M | – | (48,475) (in thousands) |
| Net income, three months ended September 30GAAP | $63.07M | – | $ (16,297) (in thousands) |
| Net income per common share, basic, three months ended September 30GAAP | $ 2.13 | – | – |
| Net income per common share, diluted, three months ended September 30GAAP | $ 2.05 | – | – |
| Weighted-average common shares outstanding, basic, three months ended September 30GAAP | 29,610 | – | – |
| Weighted-average common shares outstanding, diluted, three months ended September 30GAAP | 30,838 | – | – |
| Product revenue, net, nine months ended September 30GAAP | $362.9M | – | 80,895 (in thousands) |
| Cost of goods sold, nine months ended September 30GAAP | 20.32M | – | 3,859 (in thousands) |
| Research and development, nine months ended September 30GAAP | 44.74M | – | 1,488 (in thousands) |
| Stock-based compensation in research and development, nine months ended September 30GAAP | $7.3M | – | – |
| Selling, general, and administrative, nine months ended September 30GAAP | 114.6M | – | 9,320 (in thousands) |
| Stock-based compensation in selling, general, and administrative, nine months ended September 30GAAP | $34.4M | – | – |
| Total operating expenses, nine months ended September 30GAAP | 179.7M | – | 14,667 (in thousands) |
| Income from operations, nine months ended September 30GAAP | 183.3M | – | 66,228 (in thousands) |
| Interest and other income, net, nine months ended September 30GAAP | 24.41M | – | 3,098 (in thousands) |
| Income before income taxes, nine months ended September 30GAAP | 207.7M | – | 69,326 (in thousands) |
| Income tax (expense) benefit, nine months ended September 30GAAP | −33.90M | – | (48,989) (in thousands) |
| Net income, nine months ended September 30GAAP | $173.8M | – | $ 20,337 (in thousands) |
| Net income per common share, basic, nine months ended September 30GAAP | $ 5.90 | – | – |
| Net income per common share, diluted, nine months ended September 30GAAP | $ 5.66 | – | – |
| Weighted-average common shares outstanding, basic, nine months ended September 30GAAP | 29,477 | – | – |
| Weighted-average common shares outstanding, diluted, nine months ended September 30GAAP | 30,680 | – | – |
| Gross margin, third quarter 2026GAAP | 94% | – | – |
Segments
| Segment | Revenue | q/q | y/y |
|---|---|---|---|
| VYJUVEKPatient demand in the United States continues to grow with over 760 reimbursement approvals secured for VYJUVEK nationwide, while the company is expanding across Germany, France, and Japan. | $127.3 million in 3Q VYJUVEK global revenue | – | 30% |
Amounts quoted below without a unit are in thousands, as in the filing’s tables. Per-share figures are as printed.
FY 2026 outlook
- Operating expenses$155.0 - $165.0
- NoteNon-GAAP Research and Development (“R&D”) and Selling, General and Administrative (“SG&A”) expense
- NoteNon-GAAP combined R&D and SG&A expense guidance does not include stock-based compensation.
Capital returns
- Board of Directors authorized a share repurchase program under which Krystal may repurchase up to $400 million of its outstanding common stock.
- The program has no expiration date, does not obligate Krystal to repurchase any amount of common stock, and may be modified, suspended or discontinued at any time at the Company’s discretion.
What drove it
- VYJUVEK global net product revenue was $127.3 million in the third quarter of 2026, with patient demand continuing to grow in the United States.
- Pricing negotiations were completed in Germany and Italy, and the company expects to launch VYJUVEK in Italy in early 2027.
- KB113 clinical data showed investigator-assessed clinical regression in more than 80% of assessed basal cell carcinoma lesions in the company’s three patient pilot study.
- KB707 interim clinical results presented in May demonstrated an objective response rate of 31% and a disease control rate of 75% in the KYANITE-1 dose expansion cohort evaluating inhaled KB707 with pembrolizumab.
Concerns
- Net income for the three months ended September 30, 2026 was $63.1 million, compared to $79.4 million for the three months ended September 30, 2025, reflecting income tax expense of $17.1 million versus an income tax benefit of $31.4 million.
- Patient enrollment in the KB801 EMERALD-1 study has progressed slower than initially anticipated, reflecting narrowly defined eligibility criteria and challenges enrolling patients in a placebo-controlled trial with an available approved therapy.
- Pricing negotiations remain ongoing in multiple European countries and the United Kingdom. The company expects decisions in Spain later this year and in France no earlier than 2027.
- The company has not provided a quantitative reconciliation of forecasted non-GAAP combined R&D and SG&A expense to forecasted GAAP expense because it cannot confidently estimate stock-based compensation expense.
What to watch
- VYJUVEK launch timing in Italy in early 2027 and pricing and reimbursement decisions in Spain and France.
- Interim HALITE-1 results for KB111 before the end of the year and the planned FDA meeting in the first quarter of 2027.
- Top-line IOLITE results for KB803 shortly after the expected last patient visit in February 2027.
- Completion of approximately 60-patient EMERALD-1 enrollment and KB801 top-line results in 2027.
- KB407 interim results in the first half of 2027 and the planned initiation of its registrational study in 2027.
- Interim KB408 results in 2027 and enrollment of approximately 70 patients in the KB707 chemotherapy combination cohort by mid-2027.
Balance sheet and cash flow
- Cash, cash equivalents and investments totaled $1.2 billion as of September 30, 2026.
- Cash and cash equivalents: $ 462,841 (in thousands) as of September 30, 2026; $ 496,304 (in thousands) as of December 31, 2025.
- Short-term investments: 449,010 (in thousands) as of September 30, 2026; 331,487 (in thousands) as of December 31, 2025.
- Long-term investments: 282,301 (in thousands) as of September 30, 2026; 128,066 (in thousands) as of December 31, 2025.
- Total assets: 1,586,056 (in thousands) as of September 30, 2026; 1,333,794 (in thousands) as of December 31, 2025.
- Total liabilities: 150,472 (in thousands) as of September 30, 2026; 114,234 (in thousands) as of December 31, 2025.
- Total stockholders’ equity: $ 1,435,584 (in thousands) as of September 30, 2026; $ 1,219,560 (in thousands) as of December 31, 2025.
Analysis
Krystal reported $127.3 million of third-quarter VYJUVEK global net product revenue, up 30% compared with the prior-year third quarter, and stated that VYJUVEK has generated $1.1 billion since launch. The company cited continued U.S. patient-demand growth, over 760 reimbursement approvals nationwide, and expansion of its prescriber base. Internationally, pricing negotiations have concluded in Germany and Italy, with an Italian launch expected in early 2027, while negotiations continue across other European countries and the United Kingdom.
The quarter was profitable on a GAAP basis. Income from operations was 71,145 (in thousands), compared with 41,374 (in thousands) in the prior-year quarter, while gross margin was 94%. Total operating expenses were 56,196 (in thousands), slightly below 56,426 (in thousands) a year earlier, as lower selling, general, and administrative expense more than offset a modest increase in research and development expense. Net income was $ 63,068 (in thousands), below $ 79,365 (in thousands) in the prior-year period because income tax (expense) benefit shifted to an expense of (17,077) (in thousands) from a benefit of 31,398 (in thousands).
For the nine months ended September 30, 2026, product revenue, net was $ 362,920 (in thousands), compared with $ 282,025 (in thousands) in the prior-year period. Income from operations increased to 183,253 (in thousands) from 117,025 (in thousands), and net income rose to $ 173,768 (in thousands) from $ 153,431 (in thousands). The company ended the quarter with $1.2 billion in cash and investments and authorized a repurchase program of up to $400 million, with no expiration date and no obligation to repurchase shares.
The development update contains several forthcoming catalysts and one disclosed execution issue. KB113 data showed regression in more than 80% of assessed basal cell carcinoma lesions in a three-patient pilot study, and the company has initiated FDA discussions on advanced clinical development. KB111 interim results are expected before year-end, while KB803 top-line results are expected shortly after the projected February 2027 last patient visit. KB801 enrollment has been slower than initially anticipated, and the company now expects top-line results in 2027.
FY 2026 guidance provided only non-GAAP combined R&D and SG&A expense of $155.0 - $165.0, excluding stock-based compensation. No revenue, gross-margin, or tax-rate outlook was provided. The company said it cannot provide a quantitative reconciliation to forecasted GAAP combined R&D and SG&A expense because forecasted stock-based compensation cannot be confidently estimated.
Management, verbatim
Continued growth in VYJUVEK revenue is supporting profitability and funding the advancement of our pipeline.
Krish S. Krishnan, Chairman and Chief Executive Officer of Krystal Biotech
Our financial strength allows us to invest fully in these programs and our global commercial expansion while returning capital to shareholders.
Krish S. Krishnan, Chairman and Chief Executive Officer of Krystal Biotech
Not in the filing
stated, not guessed- Prior-quarter financial metrics
- Operating cash flow
- Free cash flow
- Debt balance
- Dividend information
- FY 2026 revenue guidance
- FY 2026 gross-margin guidance
- FY 2026 tax-rate guidance
- Prior-year gross margin
- GAAP combined R&D and SG&A expense guidance
- Prior outlook for comparison
Written by an AI language model from the company’s SEC earnings filing (Form 8-K Item 2.02, or Form 6-K for a foreign private issuer). Every figure was checked against the filing text, and a metric whose value, prior period and change do not add up is dropped from the metrics. The model can still misread a table, in the metrics or in the text, so check a number in the filing before you rely on it. Consensus estimates, price targets and share-price reactions are not shown because they are not in the filing. AI-generated research, not investment advice.