Sarepta's PMO franchise carries Q3 as ELEVIDYS shrinks and DM1/FSHD data loom

The quarter in numbers

Sarepta reported total revenues of $381.4 million for the three months ended September 30, 2026, down $18.0 million, or 5%, from $399.4 million a year earlier. Net product revenues were approximately $323.8 million, made up of approximately $240.3 million from PMO products and $83.5 million from ELEVIDYS.

Profitability improved sharply against a weak comparison. The GAAP operating loss narrowed to $(9.0) million from $(103.4) million, and non-GAAP operating income was $22.9 million against a loss of $(35.7) million. GAAP net loss was $(28.5) million, or $(0.27) per diluted share, versus $(50.6) million, or $(0.50). Non-GAAP net income was $15.6 million, or $0.13 per share, versus a $(12.9) million loss, or $(0.13).

Over nine months, total revenues were $1,513.4 million versus $1,755.3 million, a 14% decline. GAAP operating income was $362.7 million against a $(288.2) million loss, and non-GAAP operating income was $507.1 million. Nine-month GAAP diluted EPS was $2.78, versus $(3.06) a year earlier.

What drove revenue

The company attributed the quarterly revenue decline primarily to lower ELEVIDYS sales volume, citing the continued impact of the updated label, which includes only the ambulatory patient population. Partly offsetting this was a $31.4 million increase in contract manufacturing revenues tied to increased commercial ELEVIDYS supply delivered to Roche.

The nine-month picture is distorted by collaboration income. Sarepta recognized $365.0 million of collaboration revenue in 2026, related to Roche's declined option for certain program rights and the milestone for first commercial dosing of ELEVIDYS in Japan. That compares with $175.5 million in 2025, an increase of $189.5 million. Contract manufacturing revenues rose $72.5 million over the period. These items cushioned, but did not fully offset, the lower ELEVIDYS volume.

The release gives no price/volume split for PMO products, but the company said its guidance revision was driven by strong PMO performance.

Costs and margins

Cost of sales, excluding amortization of in-licensed rights, rose to $188.5 million from $150.8 million, up $37.7 million. The company pointed to a $62.0 million take-or-pay charge for non-cancelable manufacturing obligations with Catalent, for inventories it elected not to manufacture. It also cited higher cost of sales on products sold to Roche, including write-offs of certain batches that did not meet quality specifications. Lower US ELEVIDYS volume and corresponding royalty payments partly offset these.

R&D expense fell to $82.5 million from $218.9 million. The prior-year figure included a $100.0 million milestone payment to Arrowhead for the DM1 program, and the company also cited reduced manufacturing and clinical spending after the July 2025 pipeline reprioritization. Non-GAAP R&D was $71.6 million versus $206.5 million.

SG&A moved the other way: $118.6 million versus $91.9 million, with non-GAAP SG&A at $97.6 million versus $77.1 million. The company said the increase mainly reflects prior-year reversals of expense tied to the Restructuring.

Below the operating line, other expense, net was $(16.7) million versus income of $35.0 million. The company linked the swing to the August 2025 sale of its Arrowhead investment and higher interest expense, as the 2030 Notes carry a higher rate than the 2027 Notes.

Guidance: higher floor, lower expense ceiling

Sarepta raised the low end of full-year total net product revenue guidance by $50.0 million, to a range of $1.25 billion to $1.3 billion. It also lowered the high end of combined non-GAAP R&D and SG&A guidance by $25.0 million, to $800 million to $825 million.

For ELEVIDYS, the company expects fourth-quarter net product revenue to trend in line with the third quarter, consistent with prior guidance and "subject to normal variability associated with one-time gene therapy." Read against the $83.5 million Q3 figure, that implies no near-term rebound from the label-driven volume decline. The company said it expects the PMO franchise to remain strong.

Pipeline and regulatory catalysts

The near-term catalyst is multiple ascending dose data for SRP-1003 in DM1 and SRP-1001 in FSHD, expected in the fourth quarter of 2026. The company said the DM1 readout will cover DMPK knockdown and splicing correction, and the FSHD readout will cover DUX4 knockdown. Sarepta said it is already preparing for Phase 3 in both programs, including beginning manufacturing of clinical supply. It is also preparing for both accelerated and traditional approval pathways, with strategy to be informed by the data and FDA discussions.

Preclinical SRP-1003 data presented at the Oligonucleotide Therapeutics Society meeting showed dose-dependent reductions of pathogenic DMPK mRNA in both nucleus and cytoplasm, with comparable knockdown in each, the company said.

On ELEVIDYS, Sarepta presented data at the World Muscle Society congress in ambulatory patients aged 8 to 12 at treatment, showing durable benefit over two years on the North Star Ambulatory Assessment and timed function measures against a well-matched external control. It also showed dystrophin expression in patients treated at ages 2 and 3. Initial Phase 4 ENDURE results offered preliminary real-world data on liver safety risk mitigation approaches.

What to watch next

Balance-sheet capacity looks adequate for the plan. Cash, cash equivalents, restricted cash and investments were approximately $998.7 million, up from $953.8 million at December 31, 2025. The company said this and commercial cash flows should fund the DM1 and FSHD programs through late-stage development.

Watch the Q4 DM1 and FSHD data, the size of any further manufacturing-related charges, and whether PMO strength continues to lift full-year revenue toward the top of the $1.25 billion to $1.3 billion range.