Senti Biosciences(SNTI) - 2025 Q2 - Quarterly Report

PART I - FINANCIAL INFORMATION Financial Statements (Unaudited) Senti Biosciences reported a $28.8 million net loss for H1 2025, with cash decreasing to $21.6 million, raising substantial doubt about its going concern ability Condensed Consolidated Balance Sheets Total assets decreased to $68.5 million by June 30, 2025, driven by a 55.3% reduction in cash and cash equivalents to $21.6 million Condensed Consolidated Balance Sheet Highlights (in thousands) | Account | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Assets | | | | Cash and cash equivalents | $21,576 | $48,277 | | Total current assets | $32,521 | $58,961 | | TOTAL ASSETS | $68,540 | $97,841 | | Liabilities & Equity | | | | Total current liabilities | $9,987 | $13,146 | | TOTAL LIABILITIES | $43,888 | $47,086 | | TOTAL STOCKHOLDERS' EQUITY | $24,652 | $25,649 | - Cash and cash equivalents decreased by 55.3% from $48.3 million at the end of 2024 to $21.6 million as of June 30, 2025[9] Condensed Consolidated Statements of Operations and Comprehensive Loss Net loss widened to $28.8 million for H1 2025, up from $23.3 million in H1 2024, primarily due to increased R&D and G&A expenses Statement of Operations Summary (in thousands) | Metric | Q2 2025 | Q2 2024 | Six Months 2025 | Six Months 2024 | | :--- | :--- | :--- | :--- | :--- | | Research and development | $10,029 | $9,151 | $19,310 | $17,929 | | General and administrative | $6,769 | $4,205 | $13,885 | $11,728 | | Loss from operations | $(16,798) | $(13,356) | $(33,195) | $(29,657) | | Net loss | $(14,733) | $(11,203) | $(28,845) | $(23,314) | | Net loss per share | $(0.56) | $(2.45) | $(1.59) | $(5.10) | Condensed Consolidated Statements of Stockholders' Equity Stockholders' equity decreased to $24.7 million by June 30, 2025, with all Series A preferred stock converting to common stock and accumulated deficit reaching $326.0 million - In the first quarter of 2025, all outstanding Series A redeemable convertible preferred stock (21,157 shares) was converted into 21,157,000 shares of common stock[13][76] - The accumulated deficit increased by $28.9 million during the first six months of 2025, reaching $326.0 million[9][13] Condensed Consolidated Statements of Cash Flows Net cash used in operating activities increased to $27.1 million for H1 2025, resulting in a $26.7 million net decrease in cash and equivalents Cash Flow Summary (in thousands) | Activity | Six Months 2025 | Six Months 2024 | | :--- | :--- | :--- | | Net cash used in operating activities | $(27,123) | $(20,027) | | Net cash used in investing activities | $(184) | $(15) | | Net cash provided by financing activities | $597 | $0 | | Net decrease in cash | $(26,710) | $(20,042) | Notes to Condensed Consolidated Financial Statements Notes disclose substantial doubt about going concern due to insufficient cash, detailing the GeneFab transaction, leases, stock compensation, and related party dealings - The company concluded that substantial doubt exists about its ability to continue as a going concern, as its cash and cash equivalents of $21.6 million as of June 30, 2025, are not sufficient to fund operations for at least one year[24] - On March 20, 2025, the company entered into an at-the-market (ATM) offering agreement to sell up to $17.5 million of its common stock. Through June 30, 2025, it sold 155,840 shares for gross proceeds of $0.6 million[70] - The company has significant related party transactions, primarily with GeneFab, LLC, which provides manufacturing services and subleases facilities from Senti. As of June 30, 2025, Senti had a $5.5 million prepaid expense balance and a $3.5 million receivable from GeneFab[30][38] Management's Discussion and Analysis of Financial Condition and Results of Operations Management discusses clinical-stage biotech status, recent developments including SENTI-202 Orphan Drug Designation and SN301A trial halt, and reiterates going concern doubts due to insufficient cash - The company's lead product candidate, SENTI-202, received Orphan Drug Designation from the FDA for treating relapsed/refractory hematologic malignancies[140] - Enrollment in the clinical trial for SN301A, which incorporates Senti's SENTI-301A gene circuit, was stopped by partner Celest Therapeutics due to the observation of dose-limiting toxicities[123][141] - Management concluded there is substantial doubt about the company's ability to continue as a going concern, as cash and cash equivalents of $21.6 million as of June 30, 2025, are not sufficient to fund operations for at least one year[185] Comparison of Operating Results (in thousands) | Period | R&D Expense | G&A Expense | Net Loss | | :--- | :--- | :--- | :--- | | Q2 2025 | $10,029 | $6,769 | $(14,733) | | Q2 2024 | $9,151 | $4,205 | $(11,203) | | Six Months 2025 | $19,310 | $13,885 | $(28,845) | | Six Months 2024 | $17,929 | $11,728 | $(23,314) | Quantitative and Qualitative Disclosures About Market Risk As a smaller reporting company, Senti Biosciences is exempt from providing quantitative and qualitative market risk disclosures - As a "smaller reporting company," Senti Biosciences is not required to provide quantitative and qualitative disclosures about market risk[195] Controls and Procedures Management concluded disclosure controls were effective as of June 30, 2025, having remediated a previously identified material weakness in finance and accounting resources - A material weakness in internal control over financial reporting, related to insufficient resources in the finance and accounting function, was previously identified[198] - Management believes the previously identified material weakness has been remediated as of June 30, 2025, and concluded that disclosure controls and procedures were effective[199] PART II - OTHER INFORMATION Legal Proceedings The company is not aware of any material legal proceedings or claims that would adversely affect its operations or financial condition - The company reports no material legal proceedings[203] Risk Factors Key risks include recurring losses, going concern doubts, unproven gene circuit technology, SN301A trial halt, reliance on GeneFab, and IP protection challenges - The company has a history of recurring losses and its financial condition raises substantial doubt about its ability to continue as a going concern, requiring it to obtain sufficient funding[205][212] - The company's gene circuit platform is a novel, unproven technology, which makes it difficult to predict the time and cost of development and the potential for regulatory approval[206][248] - There are significant risks related to the transaction with GeneFab, including potential failure to realize anticipated benefits and GeneFab's non-payment of approximately $3.5 million in sublease and service obligations as of June 30, 2025[283][306][315] - Clinical trials may fail or suffer delays. The SN301A trial was stopped due to dose-limiting toxicities, and SENTI-202, the lead candidate, is still in early clinical development[205][246] Unregistered Sales of Equity Securities and Use of Proceeds The company reported no unregistered sales of equity securities during the period - None[558] Defaults Upon Senior Securities The company reported no defaults upon senior securities - None[559] Mine Safety Disclosures This item is not applicable to the company - None[560] Other Information No directors or officers adopted or terminated Rule 10b5-1 trading plans during the quarter ended June 30, 2025 - No directors or officers adopted or terminated any Rule 10b5-1 trading plans during the quarter[561] Exhibits This section lists exhibits filed with the quarterly report, including officer certifications and Inline XBRL data files