Analyst Conference Summary

biotechnology

conference date: August 5, 2025
for quarter ending: June 30, 2025 (second quarter, Q2)

Forward-looking statements

Overview: Continues to advance pipeline.

Basic data (GAAP):

Revenue was $19.2 million, up 31% sequentially from $14.7 million, and up 33% from $14.4 million year-earlier.

Net Income was negative $172 million, up sequentially from negative $202 million, and down from negative $98 million year-earlier.

EPS (Earnings per Share), diluted, was negative $0.41, up sequentially from negative $0.50, down from negative $0.40 year-earlier. Sharecount increased to 417 milion from 242 million.

Guidance:

Cash runway to Q4 2027.

Conference Highlights:

Chris Gibson, CEO, said "The power of our platform not only allows us to discover and develop potential new medicines, but also gives us insights on patient populations to target that would be challenging using traditional methods,” said Chris Gibson, Co-Founder and CEO of Recursion. “In discovery, we’re deploying advanced models like Boltz-2 to rapidly design ligands for high-value targets. State of the art platform capabilities helped us drive our fourth partnered discovery milestone with Sanofi this quarter, reflecting tangible momentum across our joint pipeline. We are leveraging these and other improvements to the Recursion OS to not only accelerate and improve our funnel of new programs, but also execution of later stage programs in our pipeline like RBM39 and CDK7." The restructuring activities announced in June 2025, will incur costs totalling $9.3 million, of which $3.9 million was paid in Q2 2025. Recursion expects to incur all of these expenses in the year 2025. Confident in new Recursion OS 2.0., the Boltz-2 protein prediction open source model, and ClinTech.

Recursion is in discovery partnerships with Roche, Sanofi, Bayer, and Merck KGaA. In Q2 2025 received a $7 million milestone payment from Sanofi.

REC-1245 entered Phase 1 in Q2 2025. It is a first-in-class RBM39 degrader, identified using phenomap-derived insight, which mimics CDK12 loss to induce replication stress and suppress DDR pathways without CDK12 related toxicities. Early data showed activity in tumors with replication stress and DNA repair vulnerabilities. The trial is now enrolling select tumor types to identify responsive populations.

REC-617, a CDK7 inhibitor, in Q2 2025 started a Phase 1 trial with platinum-resistant ovarian cancer as the first cohort.

REC-4881, a MEK1/2 inhibitor, is in a Phase 2 clinical trial for FAP (familial adenomatous polyposis). An oral presentation of May 4, 2025 showed the 4 mg QD does lead to a median 43% recution in polyp burden at 13 weeks. 5 of 6 patients showed decreases, but one patient had a sustantial increase. Safety was typical of a MEK inhitor.

REC-7735 targetting PI3Ka H1047R for breast cancer is preclinical, has shown activity in mice. H1047R mutation is present in about 14% of HR+/HER2- breast cancers.

REV102 targetting ENPP1 for hypophasphatasia has reached the IND-enabling stage, with preclinical data supporting first-in-class potential. In Q2 2025 Recursion acquired full rights from Rallybio.

Other preclinical programs include REC-617; REC-3565; REC-4539.

Recursion has decided to ax three programs: REC-2282, which had been in Phase 2; REC-994, and REC-3964. All had shown some positive trends, but not enough to go forward.

Sanofi and Recursion now are in four partnered programs. A milestone achieved in Q1 resulted in a $7 million milestone payment, with program potential for $300 million more in milestone payemtns.

Recursion is also in collaborations with Roche and its subsidiary Genentech, building five phenomaps. for the project.

The platform collaboration with Enamine, leveraging Recursion's massive data layer of predicted protein-small molecule interactions, resulted in the generation of screening libraries to target 100 clinically relevant drug targets. Those libraries are now available for purchase from Enamine.

Recursion platform is now at Recursion 2.0 (earlier did 0.1 and 1.0).

Cash ended the quarter at $534 million, up sequentially from $503 million. Cash used in operating activities was $208 million.

Total expenses were $195 million, consisting of: cost of revenue $20 million, R&D $129 million, G&A $47 million. Loss from operations $176 million. Other income $4 million.

Q&A selective summary:

Boltz 2? This is a partnership. Open source because biology is complex, we keep our large-scale tools internal, but benefit from cooperation with others for this project. We also have a proprietary model aligned with Boltz 2.

CDK7 combo expansion cohort for ovarian cancer, what is the standard of care? Single agent chemo plus Beva. That gives OS 14 to 22 months. We will be looking for meaningful improvement.

RBM39 analysis, v. CDK12? Data will help choose patients. Pheno maps give us a holistic view across different pathways. DNA repair vulnerabilities are very important, help select patients. We will see patients with various biomarkers recruited. Improved hypothesis for which patients to go forward with.

FAP data success threshold? No therapeutic is approved for FAP. We are looking for polyp burden reduction. Will need to talk to regulators about what it will take for approval.

Cash runway? Our GAAP P and L statement contains a lot of non-cash based expenses. So it is important to look at cash flow. Partnership milestones, expense reduction, and financing will get us to 2027.

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