Journey Medical Turned An Operating Profit
Second-quarter revenue rose 23% to $18.5 million as Emrosi sales expanded and launch-related spending eased.
Journey Medical Corporation (DERM), a pharmaceutical company focused on prescription treatments for dermatological conditions, turned an operating profit in the second quarter while prescription growth for its rosacea treatment Emrosi gathered pace. Operating income was $0.5 million, against a $2.9 million operating loss a year earlier, leaving the company closer to net profitability as the product entered its second year on the market.
Emrosi prescriptions traced the clearest operating trajectory: approximately 27,000 in the fourth quarter of 2025, 30,000 in the first quarter of 2026 and 36,000 in the second quarter. The larger latest increase marked a quickening in prescription uptake across the three periods. Chief Executive Claude Maraoui said prescription demand and payer coverage were increasing, extending the commercial progress described earlier in the year.
That uptake also translated into a larger revenue contribution. Emrosi generated $8.1 million in second-quarter sales, compared with $6.3 million in the first quarter, and accounted for more than two-fifths of Journey Medical's total revenue. Continued commercial demand for Emrosi contributed to the overall revenue increase. Across its portfolio, net product revenue totaled $17.8 million, with other revenue contributing $0.7 million.
For the full year of 2025, the product generated $14.7 million following its early-April launch. Emrosi's commercialization primarily drove that year's revenue growth, partly offset by competitive pressure on Accutane. The company marketed nine branded prescription drugs, but its latest explanation of growth again centered on Emrosi.
The second-quarter profit improvement also came with a recovery in gross margin. Margin was 67%, compared with 61% in the first quarter. The earlier quarter's reduction primarily reflected a $1.3 million noncash inventory write-down involving active pharmaceutical ingredient associated with its Qbrexza acquisition. The latest margin therefore followed a quarter affected by a specific inventory charge; the company reported no comparable explanation for a charge in the second quarter.
Commercial expenses provided another part of the profitability story. Selling, general and administrative spending was $10.9 million, against $11.9 million a year earlier. Lower Emrosi launch-related spending primarily drove the reduction. That continued a pattern described in the first quarter, when Journey Medical also cited lower launch costs. Maraoui credited revenue growth and disciplined investment in the company's dermatology commercial infrastructure for its progress toward profitability.
The operating profit nevertheless stopped short of a positive bottom line. Journey Medical recorded a net loss of $0.3 million, or $0.01 a share, for the quarter. Below operating income, the company recorded $0.9 million in interest expense. Its non-GAAP measures were positive: EBITDA totaled $1.4 million and adjusted EBITDA was $2.9 million. The reconciliation included $1.4 million of share-based compensation among the adjustments separating those two measures.
The adjusted figures also reflected a calculation change introduced at the start of 2026. Journey Medical no longer excluded short-term research and development expenses, including one-time license and milestone payments, from adjusted EBITDA, and revised prior-period results accordingly. The company described these measures as supplemental to its GAAP results, which continued to show a net loss despite the quarter's operating profit.
Journey Medical ended June with $25.6 million in cash and cash equivalents and $5.0 million of its term loan classified as short-term. The cash balance formed part of management's case for continuing its commercial strategy. Maraoui said the company believes its financial resources and Emrosi's progress position it to execute that strategy, with increasing prescription demand and payer coverage remaining the forward indicators he highlighted.
Stronger demand supports expansion as pricing diverges