NEW YORK (TheStreet) -- Vivus (VVUS) - Get Report shares are down 13.3% to $1.50 per share in afternoon trading on Friday after the company announced plans to restructure its business following the release of its second quarter earnings results.
The biopharmaceutical company announced that it will reduce its headcount and cut costs with the goal of achieving positive earnings cash flow by the end of next year.
These changes were announced after the company reported a second quarter net loss of 19 cents per share, which was narrower than the loss of 25 cents per share it reported last year, and better than the 23 cents per share analysts' expected it to lose this year.
Revenue for the quarter rose 5% from the previous year to $23 million, topping analysts' $20 million expectations for the quarter.
"The U.S. market for branded anti-obesity pharmacotherapeutics has developed at a substantially lower rate than expected, held in check by a number of factors. As stated previously, we have watched this trend closely while controlling our costs throughout the first half of 2015, and we have undertaken a further review of all aspects of the Company's operations," said CEO Seth Fischer.
TheStreet Ratings team rates VIVUS INC as a Sell with a ratings score of D-. TheStreet Ratings Team has this to say about their recommendation:
"We rate VIVUS INC (VVUS) a SELL. This is driven by multiple weaknesses, which we believe should have a greater impact than any strengths, and could make it more difficult for investors to achieve positive results compared to most of the stocks we cover. The company's weaknesses can be seen in multiple areas, such as its disappointing return on equity, generally disappointing historical performance in the stock itself and generally high debt management risk."