Recursion(US:RXRX)2025-11-05 11:40Financial Performance - Recursion reported a net loss of $162.3 million for Q3 2025 and $536.6 million for the nine months ended September 30, 2025, compared to a net loss of $95.8 million and $284.8 million for the same periods in 2024 [150]. - Total revenue for the three months ended September 30, 2025, was $5,175,000, a decrease of 80% compared to $26,082,000 in the same period of 2024 [152]. - Operating revenue decreased by 81% to $4,983,000 for the three months ended September 30, 2025, from $26,082,000 in 2024 [153]. - The net loss for the three months ended September 30, 2025, was $162,253,000, representing a 69% increase from a net loss of $95,842,000 in the same period of 2024 [169]. - Operating costs and expenses for the three months ended September 30, 2025, were $177,377,000, an increase of 43% from $124,436,000 in 2024 [152]. - The company incurred a total operating loss of $172,202,000 for the three months ended September 30, 2025, compared to a loss of $98,354,000 in 2024, marking a 75% increase [152]. - General and administrative expenses rose by 10% to $41,628,000 for the three months ended September 30, 2025, from $37,757,000 in 2024 [163]. - Cash used in operating activities increased to $325,735,000 for the nine months ended September 30, 2025, compared to $243,744,000 in 2024 [171]. - The company has an accumulated deficit of $2.0 billion as of September 30, 2025 [169]. Cash and Financing - As of September 30, 2025, Recursion had cash and cash equivalents of $659.8 million, which is expected to fund operations for at least the next twelve months [149]. - Cash and cash equivalents totaled $659.8 million as of September 30, 2025, up from $594.3 million at the end of 2024 [168]. - Cash provided by financing activities included proceeds of $395.5 million from common stock issuances during the nine months ended September 30, 2025 [177]. - Cash provided by financing activities also included proceeds of $289.4 million from common stock issuances during the nine months ended September 30, 2024 [178]. - The company raised approximately $358.2 million from the sale of 74.6 million shares under an Open Market Sales Agreement as of September 30, 2025 [148]. Research and Development - Recursion's internal pipeline includes six high-potential clinical and pre-clinical programs across oncology and rare diseases, with several programs advancing towards potential development candidate designation over the next 12 months [135][143]. - The ELUCIDATE Phase 1/2 trial for REC-617 established a maximum tolerated dose of 10 mg once-daily, with 29 patients treated and a manageable safety profile [139]. - REC-7735, a precision-designed PI3Kα H1047R inhibitor, has shown significant tumor regressions in preclinical studies and is now in IND-enabling studies [143]. - Research and development expenses increased by 62% to $121,062,000 for the three months ended September 30, 2025, compared to $74,600,000 in 2024 [158]. Collaborations and Milestones - The company achieved over $500 million in upfront and milestone payments from partners, with potential future milestone payments exceeding $10 billion [142]. - The collaboration with Roche and Genentech has resulted in a second $30 million milestone payment, part of a larger 10+ year partnership [144]. - Recursion has achieved $213 million in upfront and milestone payments through its collaboration with Roche and Genentech [144]. Investments and Assets - Cash used by investing activities included property and equipment purchases of $12.4 million, with $2.9 million allocated for upgrading the BioHive-2 supercomputer and $2.7 million for lab equipment [176]. - Investing activities during the nine months ended September 30, 2025 included the disposal of Exscientia GmbH for $4.4 million [175]. - The acquisition of Exscientia involved disposal-related payments of $9.7 million and severance payments of $14.3 million [173]. Currency and Accounting - The company has not experienced material foreign currency transaction gains or losses, and a 10% change in exchange rates would have an insignificant effect on financial results [182]. - As of September 30, 2025, the company's cash and cash equivalents primarily consisted of money market funds, with interest income sensitivity affected by changes in interest rates [181]. - There were no significant changes in the company's application of critical accounting policies during the nine months ended September 30, 2025 [179]. - The company does not have a formal hedging program for foreign currency, indicating a potential risk exposure [182].