Akero(AKRO) - 2025 Q2 - Quarterly Report

PART I. FINANCIAL INFORMATION Item 1. Condensed Consolidated Financial Statements Presents Akero Therapeutics' unaudited condensed consolidated financial statements, covering balance sheets, operations, equity, cash flows, and detailed notes Condensed Consolidated Balance Sheets (Unaudited) | ASSETS (in thousands) | June 30, 2025 | December 31, 2024 | | :---------------------- | :------------ | :---------------- | | Cash and cash equivalents | $220,449 | $340,238 | | Short-term marketable securities | $521,866 | $402,840 | | Long-term marketable securities | $343,931 | $54,751 | | Total assets | $1,109,152 | $825,886 | | LIABILITIES (in thousands) | | | | Total current liabilities | $60,401 | $39,754 | | Total liabilities | $83,333 | $75,774 | | Total stockholders' equity | $1,025,819 | $750,112 | - Total assets increased by $283.266 million from December 31, 2024, to June 30, 2025, primarily driven by a significant increase in long-term marketable securities[21] - Cash and cash equivalents decreased by $119.789 million, while short-term marketable securities increased by $119.026 million and long-term marketable securities increased by $289.180 million[21] Condensed Consolidated Statements of Operations and Comprehensive Loss (Unaudited) | (in thousands, except per share) | 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 | $69,254 | $55,322 | $138,821 | $105,972 | | General and administrative | $11,619 | $10,419 | $22,934 | $19,723 | | Total operating expenses | $80,873 | $65,741 | $161,755 | $125,695 | | Loss from operations | $(80,873) | $(65,741) | $(161,755) | $(125,695) | | Interest and other income, net | $11,540 | $10,985 | $22,851 | $18,586 | | Net loss | $(70,505) | $(55,987) | $(141,230) | $(109,331) | | Net loss per common share, basic and diluted | $(0.86) | $(0.81) | $(1.76) | $(1.70) | - Net loss increased by 26% for the three months ended June 30, 2025, to $70.505 million from $55.987 million in the prior year, and by 29% for the six months ended June 30, 2025, to $141.230 million from $109.331 million[25] - Research and development expenses rose by 25% (QoQ) and 31% (YoY) due to increased EFX program costs, particularly CMO and CRO expenses for the Phase 3 SYNCHRONY program[25] Condensed Consolidated Statements of Stockholders' Equity (Deficit) (Unaudited) | (in thousands, except share amounts) | December 31, 2024 | June 30, 2025 | | :----------------------------------- | :---------------- | :------------ | | Common Stock (shares) | 72,383,013 | 79,919,203 | | Additional Paid-In Capital | $1,575,313 | $1,992,209 | | Accumulated Deficit | $(826,156) | $(967,386) | | Total Stockholders' Equity | $750,112 | $1,025,819 | - Total stockholders' equity increased by $275.707 million from December 31, 2024, to June 30, 2025, primarily due to additional paid-in capital from stock offerings, partially offset by accumulated deficit[29] - Additional paid-in capital increased by $416.896 million, reflecting proceeds from follow-on public offerings and ATM offerings, as well as stock-based compensation expense[29] Condensed Consolidated Statements of Cash Flows (Unaudited) | (in thousands) | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--------------------------------- | :----------------------------- | :----------------------------- | | Net cash (used in) operating activities | $(115,910) | $(92,593) | | Net cash (used in) investing activities | $(402,843) | $(198,047) | | Net cash provided by financing activities | $398,964 | $366,788 | | Net (decrease) increase in cash and cash equivalents | $(119,789) | $76,148 | | Cash and cash equivalents at the end of the period | $220,449 | $310,355 | - Net cash used in operating activities increased by $23.317 million, reflecting higher net losses and changes in operating assets and liabilities[32] - Net cash used in investing activities more than doubled, primarily due to increased purchases of marketable securities[32] - Net cash provided by financing activities increased by $32.176 million, driven by proceeds from follow-on public offerings and ATM offerings[32] Notes to Unaudited Condensed Consolidated Financial Statements 1. Nature of the business and basis of presentation Akero Therapeutics is a clinical-stage biotech developing EFX for MASH, in Phase 3, with recurring losses and future capital requirements - Akero Therapeutics is a clinical-stage company developing efruxifermin (EFX) for metabolic dysfunction-associated steatohepatitis (MASH), with an ongoing global Phase 3 SYNCHRONY program targeting approximately 3,500 patients[34] - The company has incurred net losses of $141.230 million for the six months ended June 30, 2025, and an accumulated deficit of $967.386 million as of June 30, 2025[38] - Existing cash, cash equivalents, and marketable securities of $1,086.246 million as of June 30, 2025, are expected to fund operations for at least 12 months from the issuance date, but additional funding will be required for full clinical development and potential commercialization of EFX[40] 2. Summary of significant accounting policies Outlines the company's significant accounting policies, including interim financial statements, use of estimates, credit risk, and adoption/evaluation of new ASUs - The company adopted ASU No. 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, effective January 1, 2025, which did not materially impact financial statements[46] - The company is evaluating ASU No. 2024-03 and ASU No. 2025-01, Comprehensive Income - Expense Disaggregation Disclosures, effective for fiscal years beginning after December 15, 2026, and interim periods after December 15, 2027, with no material impact anticipated yet[47] 3. Fair value measurements Classifies financial assets and liabilities at fair value into a three-level hierarchy, with most assets in Level 1 and 2, and warrant liabilities in Level 3 | Financial Assets (in thousands) | June 30, 2025 Total | Level 1 | Level 2 | Level 3 | | :----------------