It has been about a month since the last earnings report for Krystal Biotech, Inc. (KRYS Quick QuoteKRYS - Free Report) . Shares have added about 8.5% in that time frame, outperforming the S&P 500.

But investors have to be wondering, will the recent positive trend continue leading up to its next earnings release, or is Krystal Biotech due for a pullback? Well, first let's take a quick look at its most recent earnings report in order to get a better handle on the recent drivers for Krystal Biotech, Inc. before we dive into how investors and analysts have reacted as of late.

KRYS Q2 Earnings and Sales Top Estimates

Krystal Biotech reported second-quarter 2025 earnings per share (EPS) of $1.29, which beat the Zacks Consensus Estimate of $1.08. The reported EPS was up from 93 cents (excluding litigation expenses) in the year-ago quarter.

Revenues of $96 million surged 36.6% year over year and beat the Zacks Consensus Estimate of $91 million. Revenues came in solely from the sales of Vyjuvek.

However, shares of the company lost 14% despite better-than-expected quarterly results, probably due to soft guidance for third-quarter revenues by management.

KRYS’ Q2 Results in Detail

In 2023, the FDA approved Vyjuvek, the first-ever revocable gene therapy for treating patients aged six months or older with dystrophic epidermolysis bullosa (DEB). DEB is a rare and severe monogenic disease that affects the skin and mucosal tissues. It is caused by one or more mutations in a gene called COL7A1.

As of July, Krystal secured over 575 reimbursement approvals for Vyjuvek in the United States.

The gross margin in the reported quarter was 93%.

Research and development expenses amounted to $14.4 million, down 7.5% year over year, primarily due to the timing of various research and development activities.

Selling, general and administrative expenses totaled $35.2 million, up 27.2% from the year-ago level, primarily due to increased professional services fees, including marketing services, consulting and legal.

As of June 30, 2025, cash, cash equivalents, and investments totaled $820.8 million, up from $765.3 million as of March 31, 2025.

KRYS Makes Good Pipeline Progress

The European Commission approved Vyjuvek for the treatment of wounds in patients with DEB who have mutations in the collagen type VII alpha 1 chain (COL7A1) gene, starting from birth.

The company is working to enable the first European launch in Germany in the third quarter and in France in the fourth quarter.

Vyjuvek was also approved in July in Japan for the treatment of patients with DEB from birth. The company targets to launch the drug in Japan before the end of 2025.

Krystal Biotech is evaluating KB407 for the treatment of cystic fibrosis (CF). The company has enrolled four patients in Cohort 3 of CORAL-1, a multi-center, dose escalation study evaluating KB407 in patients with CF, regardless of their underlying genotype. KRYS expects to provide an interim molecular data readout for Cohort 3 patients before year-end.

Another candidate, KB408, is being evaluated for the treatment of alpha-1 antitrypsin deficiency. KRYS confirmed SERPINA1 delivery and functional AAT expression with corresponding reductions in free neutrophil elastase in a third patient that underwent bronchoscopy after dosing with KB408 in Cohort 2 of SERPENTINE-1, an open-label dose escalation study in adult patients with AATD.

Krystal has now amended the SERPENTINE-1 protocol to investigate repeat dosing at the Cohort 2 dose level. Enrollment in the repeat dose cohort is ongoing. Enrollment in single-dose cohorts is now closed.

Vyjuvek is referred to as B-VEC outside the country. The company is also evaluating KB803 (B-VEC formulated as an eyedrop) for ocular complications of DEB. Enrollment in the phase III IOLITE study is ongoing.

KRYS dosed the first patient in EMERALD-1, a randomized, double-blind, placebo-controlled, multi-center phase I/II study evaluating KB801 in moderate-to-severe neurotrophic keratitis patients. Enrollment is ongoing in this study.

Enrollment is ongoing in KYANITE-1, a phase I/II open-label, multi-center, dose escalation and expansion study evaluating inhaled KB707, as monotherapy or in combination, in patients with locally advanced or metastatic solid tumors of the lung.

Enrollment is also ongoing in the phase I/II open-label, multi-center, dose escalation and expansion study, OPAL-1, evaluating intratumoral KB707 in patients with locally advanced or metastatic solid tumor malignancies.

KRYS’ wholly owned subsidiary, Jeune Aesthetics, is currently developing a décolleté-specific photo numeric scale for advanced clinical development of KB301.

Last month, Jeune Aesthetics announced positive safety and efficacy results from PEARL-2, a randomized, double-blind, placebo-controlled phase I study evaluating KB304 for the treatment of wrinkles of the décolleté. Meaningful aesthetic improvements across multiple attributes, including wrinkles and elasticity, were reported by the study investigator and subjects alike following KB304 treatment, with clear and statistically significant advantages over placebo.

Based on the broad aesthetic improvements observed with KB304 in PEARL-2, Jeune has selected KB304 for progression into the phase II study. Jeune Aesthetics recently completed development and validation of a décolleté-specific photonumericscale to support the phase II evaluation of KB304. Jeune intends to submit the scale to the FDA and align on the phase II study protocol in the second half of the year.

How Have Estimates Been Moving Since Then?

Since the earnings release, investors have witnessed a downward trend in estimates review.

The consensus estimate has shifted -16.13% due to these changes.

VGM Scores

Currently, Krystal Biotech has a average Growth Score of C, though it is lagging a lot on the Momentum Score front with an F. Charting a somewhat similar path, the stock has a grade of D on the value side, putting it in the bottom 40% for this investment strategy.

Overall, the stock has an aggregate VGM Score of F. If you aren't focused on one strategy, this score is the one you should be interested in.

Outlook

Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Interestingly, Krystal Biotech has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.

Performance of an Industry Player

Krystal Biotech belongs to the Zacks Medical - Biomedical and Genetics industry. Another stock from the same industry, Alkermes (ALKS Quick QuoteALKS - Free Report) , has gained 10.5% over the past month. More than a month has passed since the company reported results for the quarter ended June 2025.

Alkermes reported revenues of $390.66 million in the last reported quarter, representing a year-over-year change of -2.1%. EPS of $0.52 for the same period compares with $0.72 a year ago.

Alkermes is expected to post earnings of $0.41 per share for the current quarter, representing a year-over-year change of -43.8%. Over the last 30 days, the Zacks Consensus Estimate has changed -6.3%.

Alkermes has a Zacks Rank #3 (Hold) based on the overall direction and magnitude of estimate revisions. Additionally, the stock has a VGM Score of A.