Executive Summary
Elite Pharmaceuticals delivered a standout core operating performance in QQ1 2026, with revenue of $40.21 million, gross profit of $27.23 million and operating income of $21.70 million, reflecting a robust gross margin of 67.7% and an operating margin of 53.9%. This demonstrates meaningful operating leverage for a small-cap generic-focused player, aided by favorable product mix and cost discipline. However, the bottom line was pressured by substantial non-operating items, as total other income/expenses netted -$22.26 million, resulting in a net loss of -$5.88 million for the quarter and a negative earnings per share of -$0.0055. The balance sheet remains solid on liquidity with cash and equivalents of about $21.74 million and a net cash position (net debt) of roughly -$15.06 million, suggesting capacity to fund near-term initiatives without elevated funding risk.
Management focal points appear to be: (1) continuing to scale high-margin generic and contract manufacturing activities, (2) advancing the abuse-deterrent opioid development program, and (3) leveraging the current operating performance to improve overall profitability as non-cash/non-operating charges unwind. While the core business metrics look favorable, investors should monitor the persistence of non-operating headwinds and any shifts in regulatory or pricing dynamics that could affect future profitability and earnings quality.
Key Performance Indicators
QoQ: 179.94% | YoY:124.03%
QoQ: 344.92% | YoY:251.87%
QoQ: 1 876.64% | YoY:481.98%
QoQ: 45.97% | YoY:-276.94%
QoQ: 45.00% | YoY:-266.67%
Key Insights
Revenue: $40.211M, YoY +124.03%, QoQ +179.94%
Gross Profit: $27.226M, YoY +251.87%, QoQ +344.92%
Operating Income: $21.699M, YoY +481.98%, QoQ +1,876.64%
Net Income: -$5.8847M, YoY -276.94%, QoQ +45.97%
EPS (GAAP): -$0.0055, YoY -266.67%, QoQ +45.00%
Gross Margin: 67.71%
Operating Margin: 53.96%
Net Income Margin: -14.63%
Cash & Equivalents: $21.74M
Total Assets: $111.34M
Total Liabilities: $63.66M
Total Stockholders’ Equity: $47.68M
Net Debt: -$15.06M
Debt Outstanding (Total Debt): $6.68...
Financial Highlights
Revenue: $40.211M, YoY +124.03%, QoQ +179.94%
Gross Profit: $27.226M, YoY +251.87%, QoQ +344.92%
Operating Income: $21.699M, YoY +481.98%, QoQ +1,876.64%
Net Income: -$5.8847M, YoY -276.94%, QoQ +45.97%
EPS (GAAP): -$0.0055, YoY -266.67%, QoQ +45.00%
Gross Margin: 67.71%
Operating Margin: 53.96%
Net Income Margin: -14.63%
Cash & Equivalents: $21.74M
Total Assets: $111.34M
Total Liabilities: $63.66M
Total Stockholders’ Equity: $47.68M
Net Debt: -$15.06M
Debt Outstanding (Total Debt): $6.68M
Book Value per Share: approximately $0.045 (stockholders’ equity / shares outstanding: $47.68M / 1.068B)
Income Statement
| Metric |
Value |
YoY Change |
QoQ Change |
| Revenue |
40.21M |
124.03% |
179.94% |
| Gross Profit |
27.23M |
251.87% |
344.92% |
| Operating Income |
21.70M |
481.98% |
1 876.64% |
| Net Income |
-5.88M |
-276.94% |
45.97% |
| EPS |
-0.01 |
-266.67% |
45.00% |
Management Commentary
Note: The earnings call transcript was not provided in the input data. Consequently, there are no direct management quotes available for inclusion. The following highlights synthesize the implied themes from the QQ1 2026 results and disclosed figures:
- Core operating strength: The company posted a strong operating result with operating income of $21.70M on revenue of $40.21M, signaling meaningful operating leverage in its generic and specialty portfolio.
- Non-operating headwinds: Total other income/expenses netted -$22.26M, driving a net loss despite robust core profitability. This suggests the presence of sizable one-off or non-operating items that management would likely discuss in the call (e.g., impairment, foreign exchange, or strategic items).
- Cash and liquidity: Cash and equivalents stood at $21.74M with a net cash position (net debt negative) of approximately -$15.06M, indicating a buffer to fund near-term initiatives without material debt burdens.
- Portfolio and strategy: The QQ1 2026 print underscores a focus on core generic lines and potential bespoke manufacturing arrangements (contract manufacturing), with ongoing development in abuse-deterrent opioids as part of a longer-term growth runway.
- Outlook caveat: Absent management commentary, investors should view the high non-operating charge as a potential one-off risk that could unwind over time, improving net profitability if operating performance is sustained.
Forward Guidance
No explicit forward-looking guidance was provided in the input data. Based on QQ1 2026 results, the following framework is proposed:
- Near-term trajectory: If the non-operating headwinds are non-recurring or scale down, the company’s strong core margins (gross margin 67.7%, operating margin 53.9%) could translate into meaningful net income as operating income compounds and interest/other expenses normalize.
- Focus areas for execution: (a) scale of core generic and contract manufacturing programs, (b) advancement and monetization of the abuse-deterrent opioid development program, (c) optimization of non-operating items and potential reductions in non-cash charges.
- Key watch items: non-operating expense trajectory, any changes to regulatory landscape affecting pricing and approvals, and working capital efficiency.
- Potential targets: stabilization of net income, reduction of negative contributions from other income/expenses, and potential debt reduction if cash generation accelerates.
Investor takeaway: The core business appears to be earning a constructive operating line, but sustainability depends on resolving or reducing non-operating headwinds and delivering on pipeline progress.