Mesoblast Ltd (ASX: MSB) shares are bouncing around in morning trade on Friday.
At one stage, the biotech stock was up almost 9% to $2.63.
But those gains didn't last and its shares are now down 3% to $2.33.
Image source: Getty Images
What's going on with Mesoblast shares?
Investors have been buying (and then selling) the biotech stock following the release of its half-year results and an operational update.
According to the release, for the six months ended 31 December 2025, Mesoblast reported total revenue of US$51.3 million. This is up sharply from US$3.2 million in the prior corresponding period.
The company's Ryoncil product generated gross sales of US$57 million and net revenue of US$48.7 million after adjustments. The product also delivered gross profit (excluding amortisation) of US$44.2 million during the half.
While the company still reported a net loss of US$40.2 million, this was an improvement on last year's US$47.9 million loss.
Mesoblast also ended the period with US$130 million in cash and entered into a US$125 million five-year non-dilutive credit facility, strengthening its balance sheet.
Commercial rollout gathering pace
Operationally, the rollout of Ryoncil continues to build momentum.
To date, 49 transplant centres have been onboarded, with a target of 64 centres representing 94% of US transplants. Coverage now extends to 280 million US lives, supported by federal Medicaid and commercial payers.
Importantly, 84% of patients in real-world settings have been able to complete the initial 28-day treatment regimen and remain alive, consistent with prior clinical experience.
Growth pipeline progressing
Beyond Ryoncil, the company continues advancing its second-generation product, rexlemestrocel-L.
A confirmatory Phase 3 trial in chronic low back pain is nearing completion of its 300-patient enrolment target, while the company plans to move toward full FDA approval for its chronic heart failure program next quarter.
Outlook
Mesoblast advised that it believes it is well-placed to continue growing revenue over the remainder of the financial year. It has guided to full-year FY 2026 Ryoncil net revenue of between US$110 million and US$120 million.
It is possible the market was expecting stronger growth in the second half and have been selling Mesoblast shares today to reflect this.
Commenting on its performance and outlook, Mesoblast's chief executive, Dr Silviu Itescu, said:
Today we report strong operational and financial performance for the first half of FY2026, a period that marks an important inflection point in Mesoblast's evolution from clinical development to sustainable commercial execution. Sales momentum for Ryoncil continued to build, driving meaningful revenue and reinforcing the product's value in addressing significant unmet medical need and the strength of our commercial strategy.
Importantly, we have improved the Company's financial position with positive cash flow generated from Ryoncil sales, disciplined cost management, and a strategic refinancing, providing greater flexibility to support expansion and late-stage clinical programs. As we enter the second half of FY2026, we remain focused on accelerating commercial uptake, advancing regulatory and label expansion opportunities, and maintaining financial discipline to deliver sustainable long-term shareholder value.
