Shares of Exelixis (EXEL) plummeted 15.5% in pre-market trading on Tuesday following the release of its second-quarter 2025 financial results. The biotechnology company's mixed performance, characterized by an earnings beat but a significant revenue miss, has sparked concern among investors.

For Q2 2025, Exelixis reported total revenues of $568.3 million, falling short of analyst expectations of $574.5 million and marking a substantial 10.8% decrease from $637.2 million in the same period last year. The primary factor behind this decline was the absence of a $150 million milestone payment that had been recorded in Q2 2024. Despite the revenue shortfall, the company's adjusted earnings per share (EPS) of $0.75 surpassed the estimated $0.56, beating expectations by 33.9%.

Adding to investor concerns, Exelixis maintained its previously provided financial guidance for fiscal year 2025, projecting total revenues between $2.25 billion and $2.35 billion. This outlook, which some market participants view as conservative given the Q2 earnings beat, appears to be contributing to the stock's significant decline. While the company reported encouraging progress in its pipeline, including positive topline results from the STELLAR-303 trial in colorectal cancer, the market seems to be focusing on the near-term financial performance and the revenue shortfall.

In response to the earnings report, several analysts have adjusted their price targets for Exelixis. Truist Securities cut its target price to $49 from $56, while Morgan Stanley lowered its target to $46 from $48, maintaining an Overweight rating. RBC Capital Markets also reduced its price target to $45 from $50, keeping a Sector Perform rating. These adjustments reflect the mixed sentiment surrounding Exelixis's future prospects in the competitive oncology market.