PART I – FINANCIAL INFORMATION [Item 1. Condensed Consolidated Financial Statements (unaudited)](index=6&type=section&id=Item%201.%20Condensed%20Consolidated%20Financial%20Statements%20%28unaudited%29) This section presents the unaudited condensed consolidated financial statements, including balance sheets, statements of operations, and cash flows, detailing the company's financial position, operational results, and the impact of the VOWST business sale and reverse stock split Condensed Consolidated Balance Sheet Highlights (in thousands) | Account | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Cash and cash equivalents | $45,379 | $30,793 | | Total current assets | $48,685 | $38,674 | | Total assets | $143,800 | $139,810 | | Total current liabilities | $30,940 | $41,222 | | Total liabilities | $110,850 | $126,026 | | Total stockholders' equity | $32,950 | $13,784 | Condensed Consolidated Statements of Operations Highlights (in thousands) | Account | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Research and development expenses | $12,939 | $15,806 | $24,760 | $35,300 | | General and administrative expenses | $10,253 | $13,065 | $22,141 | $28,009 | | Loss from operations | ($24,881) | ($28,871) | ($52,117) | ($63,309) | | Gain on sale of VOWST Business | $185 | $— | $52,366 | $— | | Net income (loss) from continuing operations | ($19,855) | ($26,196) | $12,827 | ($59,099) | Condensed Consolidated Statements of Cash Flows Highlights (in thousands) | Cash Flow Activity | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | | Net cash provided by (used in) operating activities | $13,621 | ($75,047) | | Net cash (used in) provided by investing activities | ($215) | $1,240 | | Net cash provided by financing activities | $1,180 | $18,762 | - The company has identified conditions that raise substantial doubt about its ability to continue as a going concern, as it will require additional funding to support ongoing operations and meet obligations[17](index=17&type=chunk)[48](index=48&type=chunk)[51](index=51&type=chunk) - As of June 30, 2025, the company had an accumulated deficit of **$965.3 million** and cash and cash equivalents of **$45.4 million**[17](index=17&type=chunk)[48](index=48&type=chunk)[51](index=51&type=chunk) - On September 30, 2024, the company completed the sale of its VOWST business to Société des Produits Nestlé S.A. (SPN)[35](index=35&type=chunk)[55](index=55&type=chunk)[65](index=65&type=chunk) - The VOWST transaction is classified as a discontinued operation, and its historical results are reported separately[35](index=35&type=chunk)[55](index=55&type=chunk)[65](index=65&type=chunk) - On April 21, 2025, the company effected a **1-for-20 reverse stock split** of its common stock, with all share and per-share amounts retroactively adjusted in the financial statements[57](index=57&type=chunk)[79](index=79&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=32&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses the company's strategic shift post-VOWST sale, focusing on SER-155 development, while addressing financial condition, including going concern doubts and operational results driven by cost controls and the VOWST sale gain [Overview and Strategy](index=32&type=section&id=Overview%20and%20Strategy) Following the VOWST sale, the company is now a clinical-stage entity focused on advancing SER-155, which has shown positive Phase 1b results and received FDA Breakthrough Therapy designation, but requires additional capital for further development - The company's lead candidate is **SER-155**, an investigational oral live biotherapeutic designed to prevent bacterial bloodstream infections (BSIs) in patients undergoing allogeneic hematopoietic stem cell transplantation (allo-HSCT)[111](index=111&type=chunk)[140](index=140&type=chunk) - In a Phase 1b study, SER-155 demonstrated a **77% relative risk reduction** in bacterial BSIs compared to placebo and was granted **Breakthrough Therapy designation** by the FDA in December 2024[112](index=112&type=chunk)[141](index=141&type=chunk)[147](index=147&type=chunk) - The company requires **additional capital** to begin the planned SER-155 Phase 2 study and is in active discussions with multiple parties for partnerships, out-licensing, mergers, or other transactions to secure resources[113](index=113&type=chunk)[114](index=114&type=chunk)[152](index=152&type=chunk) - On September 30, 2024, the company completed the **VOWST business sale** to Société des Produits Nestlé S.A. (SPN), a subsidiary of Nestlé[126](index=126&type=chunk)[127](index=127&type=chunk) [Results of Operations](index=50&type=section&id=Results%20of%20Operations) Operating expenses decreased due to lower R&D and G&A costs, while net income for the first half of 2025 was driven by a significant gain from the VOWST business sale and increased other income from Nestlé reimbursements Comparison of Operating Results (in thousands) | Period | Metric | Q2 2025 | Q2 2024 | Change | H1 2025 | H1 2024 | Change | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | **Operating Expenses** | | | | | | | | | | Research & Development | $12,939 | $15,806 | ($2,867) | $24,760 | $35,300 | ($10,540) | | | General & Administrative | $10,253 | $13,065 | ($2,812) | $22,141 | $28,009 | ($5,868) | | | Manufacturing Services | $1,689 | $— | $1,689 | $5,216 | $— | $5,216 | | **Other Income** | | | | | | | | | | Gain on sale of VOWST Business | $185 | $— | $185 | $52,366 | $— | $52,366 | | | Other income, net | $5,026 | $2,675 | $2,351 | $64,944 | $4,210 | $60,734 | | **Net Income (Loss)** | **from continuing operations** | **($19,855)** | **($26,196)** | **$6,341** | **$12,827** | **($59,099)** | **$71,926** | - The **decrease in R&D expenses** was primarily due to lower clinical trial costs as the SER-155 Phase 1b study has largely been completed, and reduced personnel-related costs from lower headcount[185](index=185&type=chunk)[189](index=189&type=chunk)[197](index=197&type=chunk) - The **decrease in G&A expenses** was mainly due to lower personnel-related costs (salaries, benefits, stock-based compensation) and facility costs following the reduction in headcount[184](index=184&type=chunk)[190](index=190&type=chunk)[198](index=198&type=chunk) - The **increase in Other Income** was primarily driven by a **$50.0 million** installment payment from Nestlé related to the VOWST sale and **$9.8 million** in reimbursement income for services performed under the TSA[187](index=187&type=chunk)[193](index=193&type=chunk) [Liquidity and Capital Resources](index=53&type=section&id=Liquidity%20and%20Capital%20Resources) The company held **$45.4 million** in cash as of June 30, 2025, but faces substantial doubt about its going concern ability, requiring additional funding beyond Q1 2026 despite cash inflows from the VOWST sale and ATM equity offerings - The company had cash and cash equivalents of **$45.4 million** as of June 30, 2025[124](index=124&type=chunk)[203](index=203&type=chunk) - Management has concluded that **substantial doubt** exists about the company's ability to continue as a going concern, as it anticipates requiring additional funding in the **first quarter of 2026**[124](index=124&type=chunk)[204](index=204&type=chunk)[218](index=218&type=chunk) - During the six months ended June 30, 2025, net cash provided by operating activities was **$13.6 million**, a significant improvement from the **$75.0 million** used in the same period of 2024, primarily due to proceeds from the VOWST sale[207](index=207&type=chunk)[208](index=208&type=chunk) - The company raised approximately **$1.0 million** in net proceeds from its "at the market" (ATM) equity offering program during the first six months of 2025[202](index=202&type=chunk)[211](index=211&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=59&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company reports no material changes to its market risk disclosures since the last Annual Report, with primary risks stemming from changes in interest rates and inflation - There have been **no material changes** to the company's market risk disclosures since the year ended December 31, 2024[220](index=220&type=chunk) - The company is exposed to market risk from changes in **interest rates and inflation**[220](index=220&type=chunk) [Item 4. Controls and Procedures](index=59&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that as of June 30, 2025, the company's disclosure controls and procedures were effective, with no material changes to internal control over financial reporting during the quarter - Management concluded that as of June 30, 2025, the company's disclosure controls and procedures were **effective** at the reasonable assurance level[222](index=222&type=chunk) - **No change** in internal control over financial reporting occurred during the three months ended June 30, 2025, that has materially affected, or is reasonably likely to materially affect, internal controls[223](index=223&type=chunk) PART II – OTHER INFORMATION [Item 1. Legal Proceedings](index=60&type=section&id=Item%201.%20Legal%20Proceedings) The company reports no legal proceedings during the period - None[225](index=225&type=chunk) [Item 1A. Risk Factors](index=60&type=section&id=Item%201A.%20Risk%20Factors) This section details significant risks, including the need for additional funding and going concern doubts, uncertainties in clinical development, reliance on third parties, intense competition, intellectual property challenges, and post-VOWST sale operational risks - The company will need **additional funding** to advance its product candidates and has identified conditions that raise **substantial doubt** about its ability to continue as a going concern, anticipating it will require funding in **Q1 2026**[228](index=228&type=chunk)[231](index=231&type=chunk)[234](index=234&type=chunk) - The company is a clinical-stage entity with a history of **significant losses** (**$965.3 million accumulated deficit** as of June 30, 2025) and may never achieve or maintain profitability[235](index=235&type=chunk) - The company's product candidates are based on **live biotherapeutics**, a novel approach with **significant development, regulatory, and manufacturing risks**[251](index=251&type=chunk)[253](index=253&type=chunk)[256](index=256&type=chunk) - The company **relies on third parties** for conducting clinical trials and manufacturing, which increases risks related to **performance, compliance, and supply chain disruptions**[296](index=296&type=chunk)[300](index=300&type=chunk) - The company faces **substantial competition** from major pharmaceutical and biotechnology companies with greater resources, and its products may **fail to gain market acceptance or secure adequate reimbursement**[307](index=307&type=chunk)[313](index=313&type=chunk)[319](index=319&type=chunk) - The company's success is highly dependent on its ability to obtain and defend its **intellectual property**, facing risks of **patent challenges, infringement claims** from third parties (such as an ongoing lawsuit from Vedanta Biosciences), and **changes in patent law**[363](index=363&type=chunk)[383](index=383&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=120&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The company reports no unregistered sales of equity securities or use of proceeds for the period - None[467](index=467&type=chunk) [Item 5. Other Information](index=122&type=section&id=Item%205.%20Other%20Information) This section discloses changes to the Board of Directors, including the resignation of Paul R. Biondi and the appointment of Robert L. Rosiello, and confirms no Rule 10b5-1 trading arrangement changes - Paul R. Biondi **resigned** from the Board of Directors, effective August 5, 2025[470](index=470&type=chunk) - Robert L. Rosiello was **appointed** to the Board as a Class III director and to the Compensation and Talent Committee, effective August 5, 2025[471](index=471&type=chunk) - **No director or officer** of the Company adopted or terminated a **Rule 10b5-1 trading arrangement** during the three months ended June 30, 2025[475](index=475&type=chunk) [Item 6. Exhibits](index=123&type=section&id=Item%206.%20Exhibits) This item lists all exhibits filed with the Quarterly Report on Form 10-Q, including executive letter agreements and required Sarbanes-Oxley Act certifications - The report includes a list of exhibits, such as the company's certificate of incorporation, bylaws, and various certifications[477](index=477&type=chunk) - Filed **new letter agreements** with Eric Shaff, Marella Thorell, and Thomas DesRosier, dated July 21, 2025[477](index=477&type=chunk)

Financial Data and Key Metrics Changes - The company reported a net loss from continuing operations of $19.9 million in Q2 2025, compared to a net loss of $26.2 million in Q2 2024, indicating an improvement in financial performance [17] - Research and development expenses decreased to $12.9 million from $15.8 million in the previous year, reflecting lower costs associated with the SER-155 Phase Ib study and reduced personnel expenses [17] - General and administrative expenses were $10.3 million in Q2 2025, down from $13.1 million in Q2 2024, primarily due to lower personnel and IT-related expenses [18] - As of June 30, 2025, the company had cash and cash equivalents of $45.4 million, and with the recent $25 million payment received, it expects to fund operations into 2026 [18] Business Line Data and Key Metrics Changes - The SER-155 Phase Ib study demonstrated a 77% relative risk reduction in bloodstream infections compared to placebo in patients undergoing allogeneic hematopoietic stem cell transplant, with a number needed to treat of three [6][9] - The company is preparing for a Phase II study with an enrollment goal of approximately 248 participants, focusing on the prevention of bloodstream infections [8] Market Data and Key Metrics Changes - The company has received positive feedback from European physicians regarding SER-155, indicating plans to include the EU in the Phase II study [22][29] - Engagement with EU key opinion leaders (KOLs) confirmed that bloodstream infections in the alloHSCT population remain a significant unmet need [30] Company Strategy and Development Direction - The immediate corporate priority is to secure capital to advance SER-155 and other promising development candidates, exploring various transaction structures including partnerships and mergers [10][11] - The company is actively discussing potential deals with multiple parties to secure necessary resources for clinical milestones [11][28] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the potential of SER-155 to provide transformative clinical benefits for patients with serious infections and inflammatory diseases [5] - The company is mindful of the challenging biotech environment but remains focused on advancing its development programs and securing capital [10] Other Important Information - The company acknowledged the contributions of Eric Schaff, who played a significant role in the maturation of the biotherapeutic field, and welcomed Rob Rossello to the Board [19] Q&A Session Summary Question: How will the company decide the best structure for potential deals? - The company is exploring various deal structures that provide capital to advance SER-155 and leverage expertise in conducting global studies [24][28] Question: Are there plans to include the EU in the Phase II study? - Yes, the Phase II study will be a global study including European countries, and the design is robust and well-powered [29]

Forward Looking Statements This communication contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. All statements contained in this communication that do not relate to matters of historical fact should be considered forward-looking statements, including statements about: the timing and results of our clinical studies and data readouts; current or future products or product candidates and their potential benefits; our clinical development plans; comm ...

Seres Therapeutics Investor Presentation May 2025 Disclaimers 2 Seres Therapeutics, Inc. © 2025 2 Transforming patient outcomes using proprietary consortia of live biotherapeutics Strong Foundation Forward Looking Statements This communication contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. All statements contained in this communication that do not relate to matters of historical fact should be considered forward-looking statements, including s ...

Core Insights - Seres Therapeutics is presenting new exploratory biomarker data from its SER-155 Phase 1b study at the 2025 ASCO Annual Meeting, highlighting its potential role in promoting peripheral T-cell recovery and immune reconstitution post allo-HSCT [1][2] Group 1: SER-155 Study Findings - The SER-155 Phase 1b study showed improved intestinal epithelial barrier integrity and modulation of systemic inflammatory responses, with a 77% relative risk reduction in bloodstream infections (BSIs) [2][5] - New biomarker data indicates significantly higher levels of the homeostatic cytokine IL-7 and increased frequency of CD4+ T cells in the SER-155 treatment group compared to placebo, suggesting enhanced immune recovery [2][3] Group 2: Clinical Development Plans - The company plans to submit a Phase 2 trial protocol for SER-155 to the FDA soon and is seeking partners for continued clinical development [3] - SER-155 has received Breakthrough Therapy designation for reducing bloodstream infections and Fast Track designation for reducing infection risk and graft-versus-host disease in allo-HSCT patients [5][6] Group 3: About SER-155 - SER-155 is an investigational oral live biotherapeutic designed to decolonize gastrointestinal pathogens, improve epithelial barrier integrity, and induce immune homeostasis to prevent bacterial bloodstream infections in allo-HSCT patients [4][6] - The product has demonstrated a significant reduction in bloodstream infections and related complications in a Phase 1b clinical study [6]

Core Viewpoint - Seres Therapeutics (MCRB) has been upgraded to a Zacks Rank 2 (Buy), indicating a positive outlook based on rising earnings estimates, which significantly influence stock prices [1][3]. Earnings Estimates and Stock Price Impact - The Zacks rating system emphasizes the importance of earnings estimate revisions, which are strongly correlated with near-term stock price movements [4][6]. - An increase in earnings estimates typically leads to higher fair value calculations by institutional investors, resulting in stock price movements [4]. Recent Performance of Seres Therapeutics - Seres Therapeutics is projected to earn -$1.67 per share for the fiscal year ending December 2025, reflecting a year-over-year change of 89.7% [8]. - Over the past three months, the Zacks Consensus Estimate for Seres Therapeutics has increased by 85%, indicating a positive trend in earnings expectations [8]. Zacks Rank System - The Zacks Rank system classifies stocks into five groups based on earnings estimates, with Zacks Rank 1 (Strong Buy) stocks historically generating an average annual return of +25% since 1988 [7]. - The upgrade of Seres Therapeutics to Zacks Rank 2 places it in the top 20% of Zacks-covered stocks, suggesting potential for market-beating returns in the near term [10].

Core Viewpoint - Seres Therapeutics (MCRB) shows significant upside potential with a mean price target of $60.25, indicating a 713.1% increase from its current price of $7.41 [1] Price Targets and Analyst Consensus - The average price target for MCRB ranges from a low of $6 to a high of $200, with a standard deviation of $93.35, indicating high variability among analysts [2] - The lowest estimate suggests a 19% decline from the current price, while the highest estimate indicates a potential upside of 2599.1% [2] - A tight clustering of price targets, represented by a low standard deviation, suggests a high degree of agreement among analysts regarding the stock's price movement [9] Earnings Estimates and Analyst Optimism - Analysts have shown strong agreement in revising MCRB's earnings estimates higher, which correlates with potential stock price increases [11] - Over the last 30 days, the Zacks Consensus Estimate for the current year has increased by 80.3%, with three estimates moving higher and no negative revisions [12] - MCRB holds a Zacks Rank 2 (Buy), placing it in the top 20% of over 4,000 ranked stocks based on earnings estimates [13]

PART I – FINANCIAL INFORMATION [Item 1. Condensed Consolidated Financial Statements (unaudited)](index=5&type=section&id=Item%201.%20Condensed%20Consolidated%20Financial%20Statements%20(unaudited)) Presents Seres Therapeutics' unaudited condensed consolidated financial statements, including the VOWST business sale and going concern assessment [Condensed Consolidated Balance Sheets](index=5&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) Cash and cash equivalents increased to **$58.8 million** by March 31, 2025, improving total stockholders' equity to **$50.5 million** Condensed Consolidated Balance Sheet Highlights (in thousands) | Account | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Assets** | | | | Cash and cash equivalents | $58,849 | $30,793 | | Total current assets | $66,078 | $38,674 | | Total assets | $164,182 | $139,810 | | **Liabilities & Equity** | | | | Total current liabilities | $31,323 | $41,222 | | Total liabilities | $113,717 | $126,026 | | Total stockholders' equity | $50,465 | $13,784 | [Condensed Consolidated Statements of Operations and Comprehensive Income (Loss)](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations%20and%20Comprehensive%20Income%20(Loss)) Net income from continuing operations reached **$32.7 million** in Q1 2025, driven by a **$52.2 million** gain on VOWST sale Condensed Consolidated Statements of Operations Highlights (in thousands) | Account | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :--- | :--- | :--- | | Research and development expenses | $11,821 | $19,494 | | General and administrative expenses | $11,888 | $14,944 | | Total operating expenses | $27,236 | $34,438 | | Gain on sale of VOWST Business | $52,181 | $— | | Net income (loss) from continuing operations | $32,682 | $(32,903) | | Net income (loss) per share - basic | $3.76 | $(5.49) | [Condensed Consolidated Statements of Cash Flows](index=8&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Net cash provided by operating activities was **$26.9 million** in Q1 2025, a significant improvement from **$35.2 million** cash used in Q1 2024 Condensed Consolidated Statements of Cash Flows Highlights (in thousands) | Cash Flow Activity | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :--- | :--- | :--- | | Net cash provided by (used in) operating activities | $26,910 | $(35,236) | | Net cash used in investing activities | $(34) | $(62) | | Net cash provided by financing activities | $1,180 | $18,762 | | Net increase (decrease) in cash, cash equivalents, and restricted cash | $28,056 | $(16,536) | [Notes to Condensed Consolidated Financial Statements](index=9&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) Notes detail the VOWST business sale, a **$50 million** installment, a 1-for-20 reverse stock split, and going concern doubt - The company completed the sale of its **VOWST microbiome therapeutic business** to Nestlé on September 30, 2024, accounted for as a discontinued operation[35](index=35&type=chunk)[65](index=65&type=chunk) - The company received a **$50 million** cash installment on January 15, 2025, with a final **$25 million** due July 1, 2025, contingent on TSA compliance[35](index=35&type=chunk)[68](index=68&type=chunk) - Management concluded substantial doubt exists about the company's ability to continue as a **going concern**, requiring additional funding for ongoing operations[51](index=51&type=chunk)[52](index=52&type=chunk) - On April 21, 2025, the company effected a **1-for-20 reverse stock split** of its common stock, with all share and per-share amounts retroactively adjusted[57](index=57&type=chunk)[80](index=80&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=22&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses the strategic shift to **SER-155** after the VOWST sale, analyzing Q1 2025 financial results and liquidity, noting going concern doubt - Following the VOWST sale, the company focuses on developing **SER-155** to prevent bacterial bloodstream infections in allo-HSCT patients[110](index=110&type=chunk) - The FDA granted **Breakthrough Therapy designation** to **SER-155** in December 2024, providing feedback for a planned Phase 2 study[111](index=111&type=chunk)[146](index=146&type=chunk) - The company actively seeks a partner to provide financial resources and capabilities for the **SER-155** program[111](index=111&type=chunk)[113](index=113&type=chunk) - Management concluded substantial doubt exists about the company's ability to continue as a **going concern**, anticipating additional funding needed in Q1 2026[120](index=120&type=chunk)[193](index=193&type=chunk)[205](index=205&type=chunk) [Results of Operations](index=31&type=section&id=Results%20of%20Operations) Total operating expenses decreased by **$7.2 million** in Q1 2025, with significant other income from the VOWST sale gain Research and Development Expenses Breakdown (in thousands) | Category | Q1 2025 | Q1 2024 | Change | | :--- | :--- | :--- | :--- | | Live biotherapeutics platform | $5,123 | $9,164 | $(4,041) | | SER-155 | $577 | $2,400 | $(1,823) | | Personnel-related | $6,118 | $7,845 | $(1,727) | | **Total R&D Expenses** | **$11,821** | **$19,494** | **$(7,673)** | General and Administrative Expenses Breakdown (in thousands) | Category | Q1 2025 | Q1 2024 | Change | | :--- | :--- | :--- | :--- | | Personnel related | $4,173 | $6,641 | $(2,468) | | Professional fees | $3,180 | $2,628 | $552 | | Facility-related and other | $4,535 | $5,675 | $(1,140) | | **Total G&A Expenses** | **$11,888** | **$14,944** | **$(3,056)** | - Manufacturing services expenses of **$3.5 million** were recorded in Q1 2025 for services performed for Nestlé under the TSA for VOWST manufacturing[181](index=181&type=chunk) - Other income, net, increased to **$59.9 million** in Q1 2025, primarily due to the **$50.0 million** Nestlé installment and **$6.3 million** TSA reimbursement income[182](index=182&type=chunk) [Liquidity and Capital Resources](index=33&type=section&id=Liquidity%20and%20Capital%20Resources) As of March 31, 2025, the company had **$58.8 million** in cash, but projects additional funding is needed by Q1 2026, raising going concern doubt - As of March 31, 2025, the company had cash and cash equivalents of **$58.8 million** and an accumulated deficit of **$945.4 million**[192](index=192&type=chunk) - The company received a **$50 million** installment in January 2025 and expects a final **$25 million** payment on July 1, 2025, from the VOWST sale, contingent on TSA compliance[187](index=187&type=chunk) - Based on current plans, the company anticipates requiring additional funding in Q1 2026, raising substantial doubt about its ability to continue as a **going concern**[193](index=193&type=chunk)[205](index=205&type=chunk) Cash Flow Summary (in thousands) | Period | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :--- | :--- | :--- | | Cash provided by (used in) operating activities | $26,910 | $(35,236) | | Cash provided by financing activities | $1,180 | $18,762 | [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=37&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) No material changes to market risk disclosures regarding interest rates and inflation since the December 31, 2024 Annual Report - No material changes occurred in the company's market risk exposures for interest rates and inflation during Q1 2025[207](index=207&type=chunk) [Item 4. Controls and Procedures](index=37&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded disclosure controls and procedures were effective as of March 31, 2025, with no material changes in internal control - The principal executive and financial officers concluded the company's disclosure controls and procedures were effective as of March 31, 2025[209](index=209&type=chunk) - No material changes occurred in the company's internal control over financial reporting during Q1 2025[210](index=210&type=chunk) PART II – OTHER INFORMATION [Item 1. Legal Proceedings](index=38&type=section&id=Item%201.%20Legal%20Proceedings) The company reports no material legal proceedings during the period - The company reports no legal proceedings to disclose for the period[212](index=212&type=chunk) [Item 1A. Risk Factors](index=38&type=section&id=Item%201A.%20Risk%20Factors) Outlines significant risks, including urgent funding needs, substantial doubt about going concern, and challenges in clinical development and IP [Risks Related to Financial Position and Capital Needs](index=38&type=section&id=Risks%20Related%20to%20Our%20Financial%20Position%20and%20Need%20for%20Additional%20Capital) The company faces critical financial risks, requiring additional funding by Q1 2026, raising substantial doubt about going concern - The company will need additional funding to advance product candidates, including the planned **SER-155** Phase 2 study, or risk program delays[215](index=215&type=chunk) - Conditions raise substantial doubt about the company's ability to continue as a **going concern**, with funding required in Q1 2026[221](index=221&type=chunk) - The company incurred significant losses since inception, with a net loss of **$125.8 million** in FY2024 and an accumulated deficit of **$945.4 million** as of March 31, 2025[224](index=224&type=chunk) - Future installment and milestone payments from the **VOWST** sale are subject to risks, including TSA compliance and sales targets, and may not be fully realized[230](index=230&type=chunk)[231](index=231&type=chunk) [Risks Related to Discovery, Development, and Regulatory Approval](index=41&type=section&id=Risks%20Related%20to%20the%20Discovery%2C%20Development%20and%20Regulatory%20Approval%20of%20Our%20Product%20Candidates) Product candidates based on novel live biotherapeutics face lengthy, expensive, and uncertain clinical development and regulatory approval processes - The company's product candidates, based on novel **live biotherapeutics**, may face longer FDA review processes due to lack of evaluation experience[242](index=242&type=chunk) - Clinical drug development is a risky, lengthy, and expensive process with uncertain outcomes, where early positive results do not guarantee later-stage success[243](index=243&type=chunk) - The **Breakthrough Therapy designation** for **SER-155** does not guarantee faster development, review, or increased likelihood of approval[270](index=270&type=chunk)[271](index=271&type=chunk) - Disruptions at the FDA and other government agencies, such as funding shortages or health crises, could hinder timely product review and approval[280](index=280&type=chunk) [Risks Related to Dependence on Third Parties and Manufacturing](index=51&type=section&id=Risks%20Related%20to%20our%20Dependence%20on%20Third%20Parties%20and%20Manufacturing) Seres relies heavily on third parties for clinical trials and manufacturing, introducing risks of non-performance, delays, and limited commercial-scale experience - The company relies on third parties like CROs to conduct clinical trials, and their unsatisfactory performance could delay or jeopardize development programs[283](index=283&type=chunk)[285](index=285&type=chunk) - Reliance on third-party manufacturers increases risks of insufficient quantities, unacceptable costs, or quality issues, impairing development and commercialization[287](index=287&type=chunk) - The company has limited experience in commercial-scale manufacturing and cannot guarantee regulatory compliance or viable cost[291](index=291&type=chunk) [Risks Related to Intellectual Property](index=60&type=section&id=Risks%20Related%20to%20Our%20Intellectual%20Property) Success depends on obtaining and maintaining patent protection and trade secrets, facing risks of uncertain patentability, challenges, and infringement - The company's ability to protect proprietary technology through patents is uncertain, and issued patents may not prevent competitors from designing around them[343](index=343&type=chunk)[347](index=347&type=chunk) - Changes in U.S. patent law and Supreme Court rulings on patent eligibility for natural products increase uncertainty and could diminish patent value[357](index=357&type=chunk)[360](index=360&type=chunk) - The company faces risk of third-party legal proceedings alleging intellectual property infringement, which could be costly and materially adverse to the business[364](index=364&type=chunk) - Protecting trade secrets and know-how is critical, but confidentiality agreements may be breached, and misappropriation claims are difficult to enforce[355](index=355&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=76&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The company reports no unregistered sales of equity securities during the period - None reported[444](index=444&type=chunk) [Item 3. Defaults Upon Senior Securities](index=76&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) The company reports no defaults upon senior securities - None reported[445](index=445&type=chunk) [Item 4. Mine Safety Disclosures](index=77&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is not applicable to the company - None reported[446](index=446&type=chunk) [Item 5. Other Information](index=77&type=section&id=Item%205.%20Other%20Information) The company reports no other material information required to be disclosed - None reported[447](index=447&type=chunk) [Item 6. Exhibits](index=77&type=section&id=Item%206.%20Exhibits) This section lists exhibits filed with the quarterly report, including corporate documents and officer certifications - Key exhibits filed include the **2025 Incentive Award Plan** and certifications by the CEO and CFO[449](index=449&type=chunk)

Financial Data and Key Metrics Changes - Seres Therapeutics reported a net income from continuing operations of $32.7 million in Q1 2025, compared to a net loss of $32.9 million in Q1 2024, primarily driven by a $50 million installment payment received from Nestle [14] - Research and development expenses decreased to $11.8 million from $19.5 million in Q1 2024, reflecting lower personnel expenses and reduced costs related to the SER-155 Phase Ib study [15] - General and administrative expenses were $11.9 million in Q1 2025, down from $14.9 million in Q1 2024, mainly due to lower personnel and contractor expenses [15] - As of March 31, 2025, the company had cash and cash equivalents of $58.8 million, with an expected second installment payment of approximately $23.5 million from Nestle in July 2025 [15][16] Business Line Data and Key Metrics Changes - The company is advancing SER-155 into the next stage of development in allo HSCT, with a Phase 1b study showing a 77% relative risk reduction in bloodstream infections compared to placebo [6][7] - SER-155 is positioned to redefine the standard of care for allo HSCT recipients and other vulnerable patient groups at risk of bloodstream infections, indicating significant commercial opportunities [7][12] Market Data and Key Metrics Changes - Feedback from healthcare providers at the European Society for Blood and Marrow Transplantation Conference highlighted the ongoing clinical challenge of preventing bloodstream infections, with enthusiasm for SER-155's safety and efficacy results [8] - The company received external validation for SER-155, as its poster won the best clinical poster award at the conference, reinforcing the patient need and scientific rigor [9] Company Strategy and Development Direction - The company aims to submit a Phase II study protocol to the FDA in the coming weeks, incorporating constructive feedback received from the agency [10][18] - Seres Therapeutics is exploring partnerships to secure financial support for advancing SER-155, recognizing the challenging biotech financing environment [12][16] - The strategic focus includes not only allo HSCT but also addressing gut-related inflammatory and immune diseases such as IBD, indicating a broader therapeutic potential for live biotherapeutics [12] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the progress made with SER-155, citing encouraging clinical data and constructive regulatory feedback [18] - The company is prioritizing activities that advance clinical and strategic goals while exploring additional capital sources to support the Phase II study [16] Other Important Information - A one-for-20 reverse stock split was executed on April 21, 2025, with trading on a split-adjusted basis commencing on April 22, 2025, leading to regained compliance with NASDAQ listing requirements [16] Q&A Session Summary Question: Are partnership discussions gated by progress around SER-155? - Management indicated that securing a partnership is a key long lead time item for moving forward with the study, while they are advancing other necessary preparations [23][24] Question: Can you outline the powering assumptions for the Phase II study? - Management stated that the Phase II study is designed to allow data to be used for both efficacy and safety components for submission to the FDA, with an interim analysis planned [25][26][28] Question: Any updates on FDA interactions and partnership discussions? - Management reported constructive and regular interactions with the FDA, which have been helpful in moving forward, and they are making progress in partnership discussions [33][36][38] Question: Will the Phase II study include overall survival as an endpoint? - The primary endpoint for the Phase II study is bloodstream infection reductions, with discussions ongoing regarding potential efficacy measures for a Phase III study [46][49]

Financial Data and Key Metrics Changes - The company reported a net income from continuing operations of $32.7 million in Q1 2025, compared to a net loss of $32.9 million in Q1 2024, primarily driven by a $50 million installment payment received from Nestle [15][16] - Research and development expenses decreased to $11.8 million from $19.5 million in the same quarter last year, reflecting lower personnel expenses and reduced costs related to the SER-155 Phase Ib study [16] - General and administrative expenses were $11.9 million, down from $14.9 million in Q1 2024, primarily due to lower personnel and contractor expenses [16] - As of March 31, 2025, the company had cash and cash equivalents of $58.8 million, with an expected second installment payment of approximately $23.5 million from Nestle in July 2025 [16][17] Business Line Data and Key Metrics Changes - SER-155 remains the top corporate priority, with significant progress towards initiating the next clinical study, following a Phase 1b study that showed a 77% relative risk reduction in bloodstream infections compared to placebo [5][6] - The Phase 1b study also demonstrated a favorable safety profile consistent with historical data across the live biotherapeutic product platform [6] Market Data and Key Metrics Changes - The company received positive feedback from the transplant community at the European Society for Blood and Marrow Transplantation Conference, emphasizing the need for new approaches to prevent bloodstream infections [7][8] - The SER-155 poster received the best clinical poster award, validating the patient need and the scientific rigor of the study [9] Company Strategy and Development Direction - The company aims to develop SER-155 and other live biotherapeutics to prevent infections in various patient groups, including allo HSCT, autologous HSCT, cancer patients with neutropenia, and solid organ transplant recipients [12] - The strategic focus includes addressing gut-related inflammatory and immune diseases such as IBD, with an emphasis on the compromised gut epithelial barrier as a core component of underlying pathology [12] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the constructive interactions with the FDA, which have been regular and supportive, particularly due to the breakthrough therapy designation for SER-155 [36] - The company is actively exploring partnerships to secure financial support and maximize the clinical and commercial value of SER-155, given the challenging biotech financing environment [12][17] Other Important Information - A one-for-20 reverse stock split was executed, and the company regained compliance with NASDAQ's bid price requirement [17] - The company is prioritizing activities that advance clinical and strategic goals while preserving cash [17] Q&A Session Summary Question: Are partnership discussions gated by progress around SER-155? - Management indicated that securing a partnership is a key long lead time item for moving forward with the study, while they are advancing other necessary preparations [24][25] Question: Can you outline the proposed powering assumptions for the Phase II study? - Management stated that the powering included in the design will allow data from this study to be used for both efficacy and safety components for FDA submission [27][28] Question: Have there been any large staffing changes at the FDA? - Management noted that their interactions with the FDA have been constructive and regular, and they are pleased with the feedback received [36] Question: Will the Phase II study be designed to evaluate overall survival? - The primary endpoint for the Phase II study is bloodstream infection reductions, with discussions ongoing regarding potential efficacy measures for Phase III [50][52]