Company: ZLAB
Filing Date: 2025-11-06
Form Type: 10-Q
Source: 0001704292-25-000024
Chunk: 99

Company: Zai Lab Ltd
Filing Date: 2025-11-06
Form: 10-Q
Item: Part I, Item 8
Chunk 99
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30, 2024, primarily due to a decrease in government grants.

Other income decreased by $0.8 million to $3.0 million in the nine months ended September 30, 2025, primarily due to decreased loss on our equity investment in MacroGenics offset by a decrease in government grants.

Income Tax Expense 

Income tax expense was nil in both the three and nine months ended September 30, 2025 and 2024.

Net Loss

Net loss was $36.0 million in the three months ended September 30, 2025, or a loss per ordinary share attributable to stockholders of $0.03 (or loss per ADS of $0.33), compared to a net loss of $41.7 million in the three months ended September 30, 2024, or a loss per ordinary share of $0.04 (or loss per ADS of $0.42). 

Net loss was $125.1 million in the nine months ended September 30, 2025, or a loss per ordinary share attributable to stockholders of $0.11 (or loss per ADS of $1.15), compared to a net loss of $175.4 million in the nine months ended September 30, 2024, or a loss per ordinary share of $0.18 (or loss per ADS of $1.80). 

Critical Accounting Policies and Significant Judgments and Estimates 

We prepare our financial statements in conformity with U.S. GAAP, which requires management to make judgments, estimates, and assumptions that affect the reported amounts of assets, liabilities, revenues, expenses, and related disclosures. Some of those judgments can be subjective and complex. Actual results could differ from our estimates. 

Our most critical accounting policies and estimates, including those that require the most difficult, subjective, or complex judgments and are the most inherently uncertain, are described below. 

Revenue Recognition 

We sell our products to distributors (our customers), who ultimately sell the products to healthcare providers, primarily in mainland China. We recognize revenue when the performance obligations are satisfied upon the product’s delivery to distributors. 

We offer rebates to our distributors to compensate the distributors consistent with pharmaceutical industry practices. We are required to establish a provision for rebates in the same period the related product sales are recognized. The estimated amount of rebates, if any, is recorded as a reduction of revenue.

Significant judgments are required in making these estimates. In determining the appropriate accrual amount, we consider our contracted