Analyst Conference Summary

biotechnology

conference date: November 3, 2026
for quarter ending: September 30, 2026 (third quarter, Q3)

Bought initial position on 12/1/2025
Forward-looking statements

Overview: Highlights positive trial data.

Basic data (GAAP):

Revenue was $18.1 million, up sequentially from $7.7 million, and down from $5.0 million year-earlier.

Net Income was negative $119 million, up sequentially from negative $131 million, and up from negative $162 million year-earlier.

EPS (Earnings per Share), diluted, was negative $0.22, up sequentially from negative $0.25, and up from negative $0.36 year-earlier.

Guidance:

The cash runway now extends into 2029. Lowered cash spend estimates: expects 2027 op ex under $360 million.

Conference Highlights:

Najat Khan, Ph.D., CEO and President said "To pioneer a new blueprint for making medicines with AI, we believe you have to tie together three core capabilities in one engine: uncover novel biology, design differentiated molecules against challenging targets, and generate clinical evidence that matters for patients. The new TUPELO data are important clinical evidence, with REC-4881 showing deep polyp burden reductions across the upper and lower GI tract, including larger, higher-risk polyps, and reductions that persist after treatment stops. REC-1245 is an encouraging early example of that engine coming together within a single program, from biological insight surfaced by our platform to molecule design and now early clinical signals in heavily pretreated patients. Beyond our own pipeline, Sanofi has optioned a potential first-in-class molecule against a challenging dual target, while Genentech has advanced an unexplored neuroscience target from our maps. These are different programs, but they are outputs of the same AI-native engine, providing evidence of repeatability. We will keep concentrating capital where the evidence is strongest and turning innovation into impact for patients who are waiting." Emphasized continued momentum and upcoming catalysts.

Fred Hassan was appointed Chair of the Board, effective October 31, 2026.

A registrational trial for REC-4881 is now expected to begin 2H 2027. FAP (familial adenomatous polyposis), MEK1/2 Phase 2 trial showed strong efficacy signals, with deep, durable polyp burden reductions and activity throughout the GI tract and in larger, higher-risk polyps. Provided detailed data at CGA-IGC on November 2, 2026. See also New Phase 2 REC-4881 Data.

In Q3 2026 updated REC-1245 Phase 1 early data showed encouraging monotherapy activity in endometrial and liver cancer. Had a 91.7% disease control rate at doses ovee 45 mg. That dose was selected to explore expansion cohorts.

In Q3 2026 Sanofi optioned a potential first-in-class, dual targeting inhibitor oral small molecule in immunology, with a Phase 1 clinical study expected to begin in 2027. The option triggered a $10 million milestone payment to Recursion, bringing total upfront and milestone payments from Sanofi under the collaboration to $144 million. Recursion is eligible for more than $300 million in additional milestones under the program, with double digit royalties if approved.

In Q3 22026 Genentech exercised its first validated target option, for a neuroscience target. Predictions generated from the first whole-genome CRISPR knockout map built by Recursion in partnership with Roche and Genentech from a subset of over 1 trillion internally manufactured iPSC-derived neuronal cells, were rigorously jointly validated with Genentech. The collaboration includes up to 40 potential small molecule programs, each with potential for more than $300 million in development milestones plus tiered royalties up to high single digits .

REC-7735, Recursion’s AI-designed PI3Ka H1047R inhibitor, initiated a Phase 1/2 trial in Q4 2026. For patients with select PIK3CA H1047R-mutant solid tumors.

REC-617 (CDK7) early Phase 1 safety and PK combination data is expected in 1H27

REC-3565 (MALT1) early Phase 1 safety and PK combination data is expected in 1H27

Recursion is in discovery partnerships with Roche, Sanofi, Bayer, and Merck KGaA. More milestones are expected in 2H 2026 and into 2027.

In Q1 2026 REC-4881 for FAP (familial adenomatous polyposis), MEK1/2 Phase 2 trial showed strong efficacy signals, with deep, durable polyp burden reductions and activity throughout the GI tract and in larger, higher-risk polyps. Provide detailed data at CGA-IGC on November 2, 2026. See also New Phase 2 REC-4881 Data.

REC-7735 targetting Pl3Ka H1047R is now in IND enabling studies for breast and other solid tumors with the mutations. Could initiate Phase 1 in 2H 2026. Could expand to breast cancer. Selectivity should allow for enhanced safety profile.

Recursion maps of the genome gives insight into gene interactions and novel pathways, including in the immune cells of the brain. Compleated a microglial cell map. Working on two new transcriptonomics models, TxPert and TxFM.

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

Cash ended the quarter at $561 million, up sequentially from $546 million. Cash used in operating activities was $77 million. $83 million raised in Q3. In Q4 raised another $187 million from a stock offering.

Total expenses were $142 million, consisting of: cost of revenue $10 million, R&D $99 million, G&A $33 million. Loss from operations $123 million. Other income $4 million.

Q&A selective summary:

REC-4881? What does data about high risk polyps tell us? FAP patients face a lifetime of interventions. There are no approved FAP drugs that stop progression. Our data shows substantial reductions in polyp versions, both in the upper and lower track, and with larger polyps. KOLs impressed with the data. 4881 could be an adjunct to routine surveillance.

In 4881 is commercialized, percent of patients who continue surgery? Addressable population could avoid or delay surgeries.

Chronic dosing of 4881? Patients tend to be young, in their 20s, so they have flexibility in dosing regimen. Durability allows treatment breaks. Label will depend on Phase 3 results.

AI lab competition? We are pleased to see more AI bio research. We pioneered it. Data input is critical, but you need show clinical evidence of the molecules you design. The learning is recursive. Competition is based on data available. 90% of biology is unknown, 80% of diseases don't yet have drugs. So it is a big, open field. We want to be known as the real deal.

REC-1245 (RBM 29 degrader) competition? We are potentially first in class, data is encouraging. The data were on heavily pretreated, heterogeneous patients. Endometrial cancer 2 confirmed patient responses. Expansion cohorts will give us more data, which we will compare to historical response rates and the safety profile. We watch the competitive landscape, including ADSs. We have seen activity in patients who already failed ADSs. Could combine with a ADC.

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