Axsome Therapeutics (Axsome Therapeutics (AXSM)) shares took a hit in early trading Monday, even though the company reported stronger-than-expected revenue for the first quarter. The culprit? A wider net loss that missed Wall Street's estimates, as expenses climbed sharply.

The New York-based biopharmaceutical company posted a net loss of $64.5 million, or $1.26 per share, for the quarter ended March 31, compared with a loss of $59.4 million, or $1.22 per share, a year earlier. Analysts had expected a loss of just 90 cents per share. That miss overshadowed the top-line beat: total net product revenue rose 57% year over year to $191.2 million, topping consensus estimates of $189.2 million.

The growth was fueled by Auvelity, the company's drug for major depressive disorder, which generated $153.2 million in sales, up 59% from the prior year. Auvelity recently secured FDA approval for agitation associated with Alzheimer's disease, and Axsome plans to launch it commercially in June. That's a big potential market, and the company is already spending heavily to prepare.

Sunosi, used for excessive daytime sleepiness, posted revenue of $33.9 million, up 34%, while migraine treatment Symbravo contributed $4.1 million in its early launch phase. Prescriptions for Auvelity totaled about 223,000 in the quarter, up 35% year over year, underscoring continued demand.

But the cost of all this growth is rising fast. Selling, general and administrative expenses jumped to $185 million from $120.8 million a year earlier, reflecting commercialization efforts and pre-launch activities tied to Auvelity's new indication. Research and development expenses climbed to $52.7 million. That's a lot of spending for a company that's not yet profitable.

Axsome ended the quarter with $305.1 million in cash and said its current resources are sufficient to fund operations into cash-flow positivity. The company is also advancing its pipeline, including a new drug application submission for AXS-12 in narcolepsy and the addition of a potential first-in-class treatment candidate for schizophrenia and Tourette syndrome.

Technical Analysis

From a technical perspective, Axsome is still in a strong uptrend near the upper end of its 52-week range, which keeps the bigger-picture bias pointed higher even as the stock cools off. It's trading 9.3% above its 20-day simple moving average (SMA) and 17.5% above its 100-day SMA, indicating buyers have controlled both the short- and intermediate-term trend.

The relative strength index (RSI) is at 72.32, which is in overbought territory and often lines up with choppier pullbacks. That suggests upside momentum has been strong enough that traders may look for a reset before the next push. Over the past 12 months, the stock is up 77.29%, consistent with a sustained leadership trend rather than a short-lived bounce. With the 52-week high set in April at $217.00 and the stock still below that mark, traders are watching whether the next attempt can reclaim that prior peak after this pullback.

• Key Resistance: $217.00 — the prior peak where rallies stalled in April.
• Key Support: $178.00 — an area where buyers have previously shown up to defend the trend.

Price Action

AXSM Stock Price Activity: Axsome Therapeutics shares were down 2.67% at $201.01 during premarket trading on Monday, according to market data.