Shares of Amphastar Pharmaceuticals Inc. (AMPH) plummeted over 13% in after-hours trading on Tuesday, following the company's disappointing third-quarter earnings report. The sharp sell-off reflects investors' concerns over Amphastar's profitability challenges and lackluster financial performance.

For the quarter ended September 30, 2024, Amphastar reported revenue of $191.21 million, up 5.9% year-over-year but falling short of analysts' expectations of $194.69 million. The company's adjusted earnings per share (EPS) of $0.96 also missed the consensus estimate of $1.01, signaling mounting cost pressures and margin contraction.

While Amphastar saw strong sales growth in key products like BAQSIMI, Primatene MIST, and epinephrine, these gains were offset by declines in the sales of glucagon, enoxaparin, and naloxone. Additionally, the company faced significant headwinds from higher labor costs, increased component costs, and charges related to adjusting inventory and purchase commitments. As a result, Amphastar's gross margin contracted to 53.3% from 60% in the year-ago quarter, weighing heavily on overall profitability.

During the earnings call, management highlighted temporary supply disruptions in Europe for BAQSIMI, which limited sales in the region. The company also cited logistical challenges caused by Hurricane Helene, leading to delayed shipments and deferred revenue recognition of $2 million to $4 million into the fourth quarter.

"Despite facing challenges such as the impact of Hurricane Helene, which impacted our logistics and resulted in delays and delayed shipments, the core business of Amphastar remains robust," said Dan Dischner, Senior Vice President of Corporate Communications, reiterating the company's commitment to executing its strategic initiatives.