Aethlon (AEMD) Q4 2026 Earnings Transcript

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DATE

June 10, 2026, 4:30 p.m. ET

CALL PARTICIPANTS

• Chief Executive Officer and Chief Financial Officer — James Frakes
• Chief Medical Officer — Steven LaRosa

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TAKEAWAYS

• Cash and Cash Equivalents -- $5 million as of March 31, 2026, providing resources for ongoing clinical and research activities.
• Post-Year-End Capital Raise -- Raised $1.85 million in net proceeds through the at-the-market program after fiscal year end.
• Operating Expenses -- Declined 21.9% year over year to approximately $7.3 million, driven by reductions in payroll ($1.1 million), general and administrative expenses ($500,000), and professional fees ($400,000).
• Operating Loss -- Decreased to $7.3 million from $9.3 million in the prior fiscal year, reflecting cost discipline.
• Net Loss Attributable to Common Stockholders -- $7.2 million, compared to $13.4 million in the previous fiscal year.
• Other Income -- $142,000 recorded, primarily reflecting interest income; prior fiscal year had $4 million of other expense, including $4.7 million in noncash financing charges.
• Australian Oncology Trial Progress -- Cohort 2 enrollment and treatment completed; independent data safety board identified no safety concerns and recommended advancing to cohort 3 without protocol changes.
• Cohort 3 Enrollment -- First participant enrolled and completed three Hemopurifier treatments with no device deficiencies or immediate complications; safety follow-up period commenced.
• Screening Activity -- Active at all three investigative sites for cohort 3, with 3-6 participants to be treated with three Hemopurifier sessions during a one-week period.
• Preclinical Expansion -- Ongoing evaluation of Hemopurifier for removal of extracellular vesicles from plasma samples in rheumatoid arthritis and chronic kidney disease patients.
• Device Compatibility Testing -- Completed successful initial assessments of Hemopurifier compatibility with a simplified blood pump system developed by Sabre Medical.
• Compassionate Use Protocol for Ebola -- "Recent interactions with the FDA has confirmed that this protocol remains open for enrollment," allowing up to 20 patients at 10 centers in the U.S.
• Key Study Endpoints -- Primary endpoint for the oncology trial is safety; secondary endpoints include measurement of extracellular vesicle removal and effects on antitumor T cells.
• Biomarker Findings -- Initial results in cohort 1 showed decreases in EVs carrying PDL surface, implicated in resistance to anti-PD-1 therapy; cohort 2 data analysis pending.
• Intellectual Property and Platform Expansion -- Progress reported on clinical research and intellectual property milestones, demonstrating continued execution in platform growth areas.

SUMMARY

Aethlon Medical (NASDAQ:AEMD) demonstrated continued fiscal discipline by reducing its net loss and operating expenses materially during the reported period. Management signaled advancing clinical development by progressing to the third cohort of the Australian oncology trial with no protocol modifications following favorable safety feedback. The preclinical pipeline broadened with in-house efforts targeting rheumatoid arthritis and chronic kidney disease samples, aiming to validate the Hemopurifier platform in new indications.

• Management confirmed that the FDA-approved compassionate use protocol for Ebola remains open for up to 20 patients at 10 U.S. institutions, separate from prior COVID-19-related use.
• Initial compatibility assessments with Sabre Medical's simplified blood pump system were successful, with further studies under consideration to remove surrogate extracellular vesicle markers using this setup.
• The active screening at all three oncology trial sites and enrollment of the first cohort 3 participant underscore ongoing operational execution.
• Reductions in key operating cost categories—payroll, general, and professional fees—were directly cited as drivers of the declining operating loss.
• Key biomarker results from the first oncology cohort identified a decrease in PDL-bearing EVs, posited to play a role in anti-PD-1 resistance, with these findings pending further confirmation in subsequent cohorts.

INDUSTRY GLOSSARY

• Hemopurifier: Aethlon's clinical-stage device intended to eliminate circulating tumor-derived exosomes and life-threatening viruses, including those contributing to cancer therapy resistance and infectious diseases.
• Extracellular Vesicles (EVs): Submicron particles released by cells—including exosomes—implicated in disease processes and targeted for removal in Aethlon's immunotherapeutic approach.
• Anti-PD-1 Therapy: Immunotherapy that inhibits programmed cell death protein 1, used in oncology to enhance the immune response against tumors; resistance may involve PDL-bearing EVs.
• Compassionate Use Protocol: FDA regulatory mechanism allowing investigational therapies for life-threatening diseases in patients with no alternative treatment options.

Full Conference Call Transcript

James Frakes: Thank you, operator, and good afternoon, everyone. Welcome to Aethlon Medical's Fiscal Year-End March 31, 2026, Earnings Conference Call. My name is Jim Frakes, and I'm the Chief Executive Officer and Chief Financial Officer of Aethlon Medical. At 4:15 p.m. Eastern Time today, Aethlon Medical released financial results for its fiscal year ended March 31, 2026. If you have not seen or received Aethlon Medical's earnings release, please visit the Investors page at www.aethlonmedical.com to view it. Following this introduction and the reading of the company's forward-looking statement disclaimer, Dr. Stephen LaRosa, our Chief Medical Officer, and I will provide an overview of Aethlon's strategy and recent developments. I will then make some brief remarks on Aethlon's financials.

We will then open up the call for the Q&A session. Before we start the business portion of the call, please note that the news release today and this call contain forward-looking statements within the meaning of the Securities Act of 1933 as amended, and the Securities Exchange Act of 1934 as amended. The company cautions you that any statement that is not a statement of historical fact is a forward-looking statement. These statements are based on expectations and assumptions as of the date of this conference call. Such forward-looking statements are subject to significant risks and uncertainties, and actual results may differ materially from the results anticipated in the forward-looking statements.

Factors that could cause results to differ materially from those anticipated in forward-looking statements can be found under the caption Risk Factors in the company's annual report on Form 10-K for the fiscal year ended March 31, 2026. The company's most recent quarterly report on Form 10-Q and in the company's other filings with the Securities and Exchange Commission. Except as may be required by law, the company does not intend nor does it undertake any duty to update this information to reflect future events or circumstances.

Now I would like to begin by highlighting progress during the fiscal year ended March 31 going on through the first part of June as we continue to execute against our strategy of advancing the Hemopurifier platform while maintaining disciplined cost control. During the period, we achieved important clinical research and intellectual property milestones. We continue to advance our oncology program while also expanding our evaluation of Hemopurifier applications into additional disease areas through preclinical research. These efforts reflect our broader objective of establishing the Hemopurifier as a platform technology with potential applications across multiple serious and life-threatening conditions.

Taken together, these achievements demonstrate continued execution against our key priorities of clinical development, platform expansion, intellectual property growth and disciplined resource management. And now I will turn the call over to Dr. Larosa who will cover updates on the Australian oncology trial and under our R&D efforts. Steve?

Steven Larosa: Thank you, Jim. Enrollment and treatment of participants in cohort 2 of our Australian oncology trial have been completed. As a reminder, 3 participants in Cohort 2 received 2 4-hour hemopreia fire treatments during a 1-week treatment period. An independent data safety monitoring board reviewed the data, identified no safety concerns and recommended advancing to the third and final cohort of the study with no protocol modifications. Screening is actively underway at all 3 investigative sites for this final cohort where 3 to 6 participants will be treated with 3 Hemopurifier sessions during a 1-week period.

The first participant in cohort 3 of the study has been enrolled, and received 3 Hemopurifier treatments without any device deficiencies or immediate complications and is now in the safety follow-up period. Cereal extracellular vesicle and T cell measurements on participants in cohort 2 have been measured by the central lab at the University of Sydney. Formal statistical analyses comparing the effects of the 3 different Hemopurifier dosing regimens on these parameters will be performed by our CRO at the completion of the trial.

As a reminder, this is a 9 to 18 patient study designed to evaluate the safety and the feasibility of the Hemopurifier treatments and determine an appropriate dosing interval and participants with solid tumors whose disease is stable or progressing well on a treatment that includes anti-PD-1 KEYTRUDA or Opdivo. Segueing now to our preclinical activities. We are advancing our preclinical extracellular vesicle research activities, including studies evaluating removal of EVs and plasma samples from patients with rheumatoid arthritis and chronic kidney disease. Platelet-derived extracellular vesicles in their cargo have been noted to play a pathogenic role in rheumatoid arthritis. EVs in patients with chronic kidney disease have been demonstrated to contribute to congestive heart failure in this population.

These efforts support the concept of a pipeline within a single device with EV removal as the primary mechanism of action. Separately, we continued our evaluation of the Hemopurifier compatibility with a simplified blood pump system developed by Sabre Medical. Initial testing assessed flow rates and transfer of died fluid to the Hemopurifier. These assessments have been completed and were successful. Future studies being considered right now, including the use of blood or plasma and removal of surrogate markers for extracellular vesicles by the Hemopurifier using this blood pump system.

We believe that freeing the Hemopurifier up from a dialysis machine, dialysis unit and a large double lumen dialysis catheter would improve the number of physicians able to perform the Hemopurifier treatment and increase the number of places where such a treatment could be performed. For the patient, this could translate into having a less invasive vascular catheter placed and being able to receive their treatment in their therapeutic home. Aethlon Medical is closely monitoring the evolving outbreak of the Bundabouzhou species of Ebola in the Democratic Republic of the Congo and Uganda.

The company has previously published in vitro removal data on the Marburg and Zier species of Ebola from both cell culture fluid and plasma by a miniature version of the Hemopurifier. During the 2014 Zier outbreak, a single 6.5-hour Hemopurifier treatment of a critically ilebola patient with multi-organ failure was associated with a 2 log reduction in viral load and clinical recovery. In December 2014, the FDA approved a compassionate use protocol as a supplement to our open IDE for life-threatening viral infections for which there is no treatment. This compassionate use protocol allows for the treatment of up to 20 subjects at up to 10 institutions in the U.S.

Recent interactions with the FDA has confirmed that this protocol remains open for enrollment. Aethlon has shared the above information, with both the World Health Organization's R&D Boopprint expert panel, as well as the national emerging special pathogens training and education center known as ETEC, who works closely with the 13 U.S. regional special pathogen treatment centers, that would treat a patient with Ebola in the U.S. should it happen. With that, I'll turn the call back over to Jim for the financial discussion and questions.

James Frakes: Thanks, Steve, and good afternoon again, everyone. Turning briefly to the financials. As of March 31, 2026, we had approximately $5 million in cash and cash equivalents which provides resources to support ongoing clinical and research activities. Subsequent to fiscal year-end, we further strengthened our balance sheet by raising approximately $1.85 million in net proceeds through our at-the-market program. Turning to some high-level expense analysis. Our consolidated operating expenses declined 21.9% year-over-year to approximately $7.3 million, reflecting continued expense discipline and operational efficiency, while advancing our clinical and research priorities. That compares to a $9.3 million of operating expenses in the fiscal year ended March 31, 2025.

The decrease was primarily due to a $1.1 million reduction in payroll and related expenses, a $500,000 reduction in general and administrative expenses and a $400,000 reduction in professional fees. Consistent with the reduction in operating expenses, the operating loss for the fiscal year decreased to approximately $7.3 million for fiscal 2026 from $9.3 million in the prior fiscal year. You can find more detail on these expense changes in our 10-K, which breaks down specific drivers by category. Our other income was approximately $142,000 for the fiscal year ended March 31, 2026, primarily reflecting interest income earned on cash balances that compares to other expense of approximately $4 million in the prior fiscal year.

The prior year amount included approximately $4.7 million of noncash financing related charges. So overall, our net loss attributable to our common stockholders was $7.2 million for the fiscal year ended March 31, 2026. And compared to a net loss of $13.4 million for the fiscal year ended March 31, 2025. We included these earnings results and related commentary in our press release issued this afternoon. The release also included the balance sheet for March 31, 2026 and 2025 and the consolidated statements of operations for the fiscal years ended March 31, 2026, and 2025. We will file our annual report on Form 10-K following this call. Our next earnings call for the fiscal first quarter ending June 30, 2026.

We'll coincide with the filing of our quarterly report on Form 10-Q in August 2026. And now we would be happy to answer any questions that you may have. Operator, please open the call for questions.

Operator: [Operator Instructions] The first question comes from Marla Marin with Zacks.

Marla Marin: So a lot going on. So just a couple of housekeeping questions. I want to get back to something that I think you said, Jim, the compassionate use protocol, which is still open. Can you refresh us in terms of your -- it would seem to me based on my recollection of I know you treated some seriously ill cove patients, but it would seem to me that you're well below that threshold that you cited of the number of potential patients to be treated and the number of medical centers.

James Frakes: I believe the Ebola protocol is relevant only to Ebola. So it would be up to 20 patients -- Ebola patients at 10 centers.

Steven Larosa: No, that compassionate protocol specific to Ebola and it's 20 patients at up to 10 centers.

Marla Marin: Okay. Got it. So it's completely separate from the patients that you had treated in the past under emerge.

Unknown Executive: Yes.

Marla Marin: Okay. Got it.

Unknown Executive: That is correct. That is correct.

Marla Marin: Okay. Good. Can you give us a little more color on how you're planning to approach the preclinical activities around rheumatoid arthritis, is that I'm guessing that this is something that will be done in a very cost-efficient manner because that's what you've been doing in terms of expanding or extending the research activities outside the current ongoing trial. But can you give us some color and also some sense of what the time line there is?

James Frakes: You want to take that? Sure.

Steven Larosa: So Marla, rheumatoid arthritis is just 1 of the many diseases where platelet-derived EV, a sizable percentage of the EV population in our blood. -- is implicated in the disease. What we did is the first instance is test healthy plasma to look for platelet removal of EVs, platelet drive BVs. And we did that in a single large volume healthy plasma sample. We subsequently purchased in a cost-effective way, a couple of additional healthy plasma samples. And now we are purchasing large volume rheumatoid arthritis samples. And those are all being run at our lab with the focus on the platelet-derived EVs and the mine. So that work is currently underway.

And with the chronic kidney just finish the wells I mentioned chronic kidney disease. There's been recent publications that these patients have EVs that caused congestive heart failure, which is a huge source of morbidity and mortality in this population. So we have purchased small samples of chronic kidney disease plasma. We're testing them for binding to the resin in our device. And again, that work is being done in-house as well.

Marla Marin: And -- how should we think about except there? Because in the past, I know you've contributed to working on peer reviews papers, you've presented at different medical presentations. So how should we think about next steps depending upon the outcome of the testing that you're doing now?

Steven Larosa: Yes, sure. So the -- we published a preprint in 1 of the preprint servers on removal of platelet-derived EVs from a single healthy plasma specimen. The feedback we received is we needed to run more samples and that we need to also go into a relevant disease sample. So with that in mind, we got the additional healthy plasma samples, and we got the rheumatoid arthritis sand we think that this will be the data needed to satisfy the reviewers and turn, but have, in addition to a preprint and actually reviewed publication on the subject with respect to our device.

Same thing with the CKD, chronic kidney disease samples, we'll look at binding to our resin, and we would then plan on turning that into an abstract at a medical meeting and a peer-reviewed publication. Again, filling -- trying to fill the preclinical pipeline.

Marla Marin: Right. Got it. Got it. and building your database, in the most cost-effective way that you can. Is that the right way to think about it?

Steven Larosa: Yes. Yes. I think that's a good way to say it.

Marla Marin: Okay. And then last question from me. So you've treated the first participant in cohort 3. And I think at your last conference call, you said you had you were very pleased with the interest that you had seen in participating in the trial. Is that still something that's operating in terms of moving on to treating the next participant?

Steven Larosa: Yes. No, we've seen good engagement and commitment from our 3 sites in terms of screening activity. So that remains a positive, bodes well. We did have a few patients that became screen failures for not meeting an inclusion or exclusion criteria. That happens in every study, unavoidable. So -- but the most important thing for me is that the engagement is there and the activity is there.

Operator: The next question comes from Anthony Vendetti with Mastin Group.

Anthony Vendetti: Yes. Thanks. So just in terms of the efficacy, any endpoints you're looking for or readout on an efficacy standpoint because I know obviously the first studies are safety -- but you -- but what are you looking for in terms of efficacy? And are you able to report on those other than internally know about it? Are you able to publish that data.

Steven Larosa: Yes. So remember, the primary endpoint for this study is safety. Secondary endpoint is surrogate markers looking at the Hemopurifiers activity, and those would be EV removal, extracellular vesicle removal and effects on T cells, including antitumor T cells. We previously reported on some qualitative observations from the first cohort, and those are in a prior press release, where we saw some changes in EVs and T cells in the right direction. As I just said, we just received measurements from Cohort 2. But the big thing that will occur is at the end of the study, there will be a formal statistical analysis looking at those dosing regimens between the different dosing regimens.

And that will look at magnitude of EV decreases and duration of EV decreases as comparing the 3 strategies and again, magnitude and duration of positive effects on T cells. Those will be the major readouts. The study is not randomized and is small such that clinical outcomes are not a primary outcome or a secondary outcome of the study. It's just way too small for such -- for clinical efficacy.

Anthony Vendetti: Right. Right. No, of course, at this stage Yes. Certainly for statistical significance in terms of clinical efficacy, but nonetheless, if they're doing well and you're able to show that, even though that's not the primary endpoint, that's always encouraging. What about any signals suggesting that the Hemopurifier may enhance the therapies like KEYTRUDA or Opdivo.

Steven Larosa: Yes. I would just call your attention to that prior press release that shows that the EVs, including tumor-derived EVs went down in the first cohort and that there were improvements in T cells and antitumor T cells in the first cohort.

Anthony Vendetti: Okay. And then any biomarkers or exosome-related findings that have emerged as well, I guess, the EVs is what you're talking about?

Steven Larosa: Yes. In the first cohort of particular interest to us was that EVs carrying PDL surface went down during the treatment. These particular population of EVs have been implicated as a cause of resistance to anti-PD-1 therapy. So the fact that they went down with treatment, again, at least in the first cohort was a positive signal that will have to be corroborated, confirmed in the subsequent cohorts and the magnitude and duration will have to be examined, but that was a particular interest to me at least.

Anthony Vendetti: Okay. So far, to sum it up, if I could do so, everything is moving in the direction you would want it to be moving in terms of what you're seeing so far with the patients that have been treated.

Steven Larosa: Correct.

Anthony Vendetti: Okay. Thank you very much. I'll hop back in the queue..

Operator: The next question comes from Jeremy Perlman with Maxim Group.

Jeremy Pearlman: Yes, I think that was -- I didn't dial in. I think the operator will action that. I'm sorry, Anthony, you already asked the questions.

Operator: This concludes our question-and-answer session. I would like to turn the conference back over to Jim Frick for any closing remarks. Please go ahead.

James Frakes: Thank you. In closing, we remain focused on advancing the Hemopurifier platform through disciplined clinical execution and careful capital management. We appreciate your continued interest and support and look forward to speaking with you in August. Thank you very much. Goodbye.

Operator: The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.

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