Shares of Compass Pathways (NASDAQ:CMPS) climbed nearly 8% in premarket trading on Wednesday after the company reported first-quarter results that exceeded analyst expectations and highlighted important regulatory advances for its COMP360 psilocybin-based treatment.
Earnings outperform as company advances toward approval
Compass Pathways posted adjusted earnings per share of -$0.30 for the quarter, beating analyst forecasts of -$0.43 per share.
The company continues progressing toward regulatory approval for COMP360, its investigational treatment for treatment-resistant depression.
FDA grants accelerated review pathway
Compass said the U.S. Food and Drug Administration granted the company permission for a rolling New Drug Application submission and review process following positive Phase 3 trial data.
The company also received a Commissioner’s National Priority Review Voucher, which could shorten the FDA review timeline to approximately one to two months after filing.
Operating expenses decline as Phase 3 program nears completion
Research and development expenses fell to $26.5 million during the three months ended March 31, 2026, compared with $30.9 million in the same period a year earlier.
Compass said the reduction reflected lower clinical trial costs as its Phase 3 programme approaches completion.
General and administrative expenses also declined to $16.4 million from $18.7 million last year, primarily because of reduced legal and professional service expenses.
Net income boosted by warrant valuation gain
The company reported net income of $91.2 million, equivalent to $0.71 per basic share and -$0.30 per diluted share.
In the same period last year, Compass reported a net loss of $17.9 million.
The improvement was mainly driven by a non-cash fair value adjustment gain of $130.9 million related to warrants.
“COMP360 represents a fundamentally different approach for patients with treatment resistant depression, unlike any other treatment approved today,” said Kabir Nath, chief executive officer of Compass Pathways.
Cash position strengthens after financing activity
Cash and cash equivalents totaled $466.0 million as of March 31, 2026, compared with $149.6 million at the end of 2025.
The increase followed successful financing transactions and warrant exercises completed by the company.
Compass said its current cash position is expected to support operations into 2028, extending well beyond the company’s anticipated commercial launch timeline.
The company remains on schedule to complete its final NDA submission during the fourth quarter of 2026 and expects to be commercially launch-ready before year-end.