[Business Update and Highlights](index=1&type=section&id=Business%20Update%20and%20Highlights) FibroGen advanced its clinical pipeline and expects the $210 million FibroGen China sale to extend its cash runway into 2028 [Key Developments in Q2 2025](index=1&type=section&id=Key%20Developments%20in%20Q2%202025) FibroGen increased FibroGen China sale to $210 million, secured FDA agreement for roxadustat Phase 3, and plans FG-3246 Phase 2 - The sale of FibroGen China to AstraZeneca increased by **$50 million** to approximately **$210 million**, expected to close in Q3 2025[5](index=5&type=chunk)[6](index=6&type=chunk) - Upon closing the FibroGen China sale, the company's cash runway is projected to extend into **2028**[5](index=5&type=chunk)[3](index=3&type=chunk) - FibroGen reached an agreement with the U.S. FDA on key design elements for a pivotal Phase 3 trial for roxadustat in lower-risk myelodysplastic syndromes (LR-MDS) patients[5](index=5&type=chunk)[6](index=6&type=chunk)[3](index=3&type=chunk) - Initiation of the Phase 2 monotherapy trial of FG-3246 for metastatic castration-resistant prostate cancer (mCRPC) is expected in **Q3 2025**[5](index=5&type=chunk)[3](index=3&type=chunk) [Upcoming Milestones](index=2&type=section&id=Upcoming%20Milestones) FibroGen anticipates filing roxadustat's Phase 3 protocol in Q4 2025, initiating FG-3246 Phase 2 in Q3 2025, and expecting combination study results in Q4 2025 - The pivotal Phase 3 clinical trial protocol for roxadustat for anemia in LR-MDS patients is planned for submission in **Q4 2025**[7](index=7&type=chunk) - The Phase 2 monotherapy dose optimization study of FG-3246 in mCRPC is expected to start in **Q3 2025**[14](index=14&type=chunk)[5](index=5&type=chunk) - Topline results from the investigator-sponsored Phase 1b/2 study of FG-3246 in combination with enzalutamide are expected in **Q4 2025**[14](index=14&type=chunk)[5](index=5&type=chunk) [Pipeline Overview](index=2&type=section&id=Pipeline%20Overview) FibroGen's pipeline focuses on oncology with FG-3246 (ADC for prostate cancer) and anemia with roxadustat (HIF-PH inhibitor for CKD and LR-MDS) [FG-3246 (CD46 Targeting ADC)](index=2&type=section&id=About%20FG-3246) FG-3246 is a potential first-in-class CD46-targeting ADC for mCRPC, with a Phase 2 monotherapy trial expected in Q3 2025 - FG-3246 is a potential first-in-class fully human ADC targeting the **CD46 receptor**, highly present in prostate cancer[10](index=10&type=chunk) - The ADC is composed of the anti-CD46 antibody YS5 linked to the clinically validated payload **MMAE**[10](index=10&type=chunk) - A Phase 2 monotherapy dose optimization trial for FG-3246 in mCRPC is anticipated to begin in **Q3 2025**[11](index=11&type=chunk)[3](index=3&type=chunk) [Roxadustat](index=2&type=section&id=About%20Roxadustat) Roxadustat is a first-in-class oral HIF-PH inhibitor approved for CKD anemia globally, now advancing towards a U.S. LR-MDS indication - Roxadustat is an oral, first-in-class **HIF-PH inhibitor** that promotes erythropoiesis[12](index=12&type=chunk) - It is approved in China, Europe, Japan, and other countries for the treatment of anemia of **CKD** in adult patients[13](index=13&type=chunk) - FibroGen is advancing roxadustat towards a pivotal Phase 3 trial in the U.S. for anemia in patients with **LR-MDS** and high transfusion burden[3](index=3&type=chunk)[6](index=6&type=chunk) [Financial Performance](index=2&type=section&id=Financial%20Performance) FibroGen reported Q2 2025 revenue of **$1.3 million** and a narrowed net loss of **$13.7 million**, with the FibroGen China sale expected to extend cash runway [Statements of Operations Analysis](index=6&type=section&id=Statements%20of%20Operations%20Analysis) Q2 2025 revenue from continuing operations was **$1.3 million**, with net loss significantly reduced to **$13.7 million** due to lower R&D expenses Q2 2025 Statement of Operations Highlights (from Continuing Operations) | Metric | Q2 2025 (in thousands) | Q2 2024 (in thousands) | Change | | :--- | :--- | :--- | :--- | | Total Revenue | $1,348 | $998 | +35.1% | | Research and Development | $5,865 | $32,360 | -81.9% | | Loss from Operations | $(12,052) | $(46,408) | +74.0% | | Loss from Continuing Operations | $(13,683) | $(47,095) | +71.0% | | Loss per Share (basic & diluted) | $(3.38) | $(11.79) | +71.3% | [Balance Sheet Analysis](index=5&type=section&id=Balance%20Sheet%20Analysis) As of June 30, 2025, FibroGen reported total assets of **$178.1 million** and total liabilities of **$359.1 million**, with **$142.1 million** in total consolidated cash and receivables Condensed Balance Sheet Highlights | Metric (in thousands) | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Cash and cash equivalents | $23,367 | $50,482 | | Current assets held for sale | $132,650 | $110,849 | | Total assets | $178,055 | $214,525 | | Total liabilities | $359,085 | $398,160 | | Total stockholders' deficit | $(202,510) | $(205,115) | - On June 30, 2025, FibroGen reported **$142.1 million** in total consolidated cash, cash equivalents, and accounts receivable[14](index=14&type=chunk) [Financial Outlook](index=1&type=section&id=Financial%20Outlook) FibroGen's financial outlook is bolstered by the pending FibroGen China sale, expected to extend cash runway into 2028 upon Q3 2025 close - The company expects its cash runway to be sufficient to fund operating plans into **2028** after the closing of the FibroGen China sale[14](index=14&type=chunk)[5](index=5&type=chunk)[3](index=3&type=chunk)

[PART I – FINANCIAL INFORMATION](index=5&type=section&id=Part%20I%20%E2%80%93%20FINANCIAL%20INFORMATION) This section provides Serina Therapeutics, Inc.'s unaudited condensed consolidated financial statements and management's analysis of its financial condition and operations [Item 1. Financial Statements](index=5&type=section&id=Item%201.%20Financial%20Statements) Presents Serina Therapeutics, Inc.'s unaudited condensed consolidated financial statements and notes, highlighting a net loss and going concern doubt [Condensed Consolidated Balance Sheets](index=5&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) Provides a snapshot of the company's assets, liabilities, and equity at specific reporting dates Key Balance Sheet Metrics | Metric (in thousands) | June 30, 2025 | December 31, 2024 | | :-------------------- | :------------ | :---------------- | | Cash and cash equivalents | $6,041 | $3,672 | | Total current assets | $7,991 | $5,676 | | TOTAL ASSETS | $8,941 | $6,724 | | Total current liabilities | $3,561 | $2,366 | | Warrant liability | $3,549 | $3,582 | | TOTAL LIABILITIES | $7,295 | $6,216 | | Total stockholders' equity | $1,646 | $508 | | TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | $8,941 | $6,724 | - Total assets increased by **$2,217 thousand** from December 31, 2024, to June 30, 2025, primarily driven by an increase in cash and cash equivalents[17](index=17&type=chunk) - Total liabilities increased by **$1,079 thousand**, while total stockholders' equity increased by **$1,138 thousand**, largely due to the issuance of Series A convertible preferred stock[17](index=17&type=chunk)[79](index=79&type=chunk) [Condensed Consolidated Statements of Operations](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) Details the company's revenues, expenses, and net loss or income over specific reporting periods Statements of Operations Highlights | Metric (in thousands, except per share data) | Three months ended June 30, 2025 | Three months ended June 30, 2024 | Six months ended June 30, 2025 | Six months ended June 30, 2024 | | :------------------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Grant revenues | $130 | $51 | $130 | $56 | | Research and development | $3,152 | $1,594 | $6,103 | $2,700 | | General and administrative | $2,543 | $2,323 | $5,450 | $3,543 | | Total operating expenses | $5,695 | $3,917 | $11,553 | $6,243 | | Loss from operations | $(5,565) | $(3,866) | $(11,423) | $(6,187) | | Total other (expense) income, net | $(897) | $9,043 | $139 | $(3,651) | | NET (LOSS) INCOME | $(6,462) | $5,177 | $(11,284) | $(9,838) | | NET (LOSS) INCOME ATTRIBUTABLE TO SERINA THERAPEUTICS, INC. | $(6,448) | $5,204 | $(11,261) | $(9,811) | | BASIC EPS | $(0.66) | $0.61 | $(1.15) | $(1.74) | | DILUTED EPS | $(0.66) | $0.51 | $(1.15) | $(1.74) | - Net loss for the three months ended June 30, 2025, was **$(6,462) thousand**, a significant decrease from the net income of **$5,177 thousand** in the same period of 2024, primarily due to a **$9,900 thousand** increase in other expenses, net, largely from changes in fair value of warrants[19](index=19&type=chunk)[154](index=154&type=chunk) - For the six months ended June 30, 2025, net loss increased to **$(11,284) thousand** from **$(9,838) thousand** in 2024, driven by higher operating expenses, particularly R&D and G&A[19](index=19&type=chunk)[147](index=147&type=chunk) [Condensed Consolidated Statements of Stockholders' Equity](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Stockholders'%20Equity) Outlines changes in the company's equity, including stock issuances and net loss, over time - Total stockholders' equity increased from **$508 thousand** at December 31, 2024, to **$1,646 thousand** at June 30, 2025, primarily due to the issuance of Series A Convertible Preferred Stock for **$4,940 thousand** and common stock to Juvenescence for **$4,916 thousand**, offset by a net loss of **$(11,261) thousand**[20](index=20&type=chunk)[19](index=19&type=chunk)[157](index=157&type=chunk)[158](index=158&type=chunk) - The company issued **965 shares** of Series A Convertible Preferred Stock for **$4,940 thousand** and **124 shares** of common stock under an at-the-market sales agreement for **$629 thousand** during the six months ended June 30, 2025[20](index=20&type=chunk)[91](index=91&type=chunk) [Condensed Consolidated Statements of Cash Flows](index=9&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Summarizes cash inflows and outflows from operating, investing, and financing activities Cash Flow Summary | Cash Flow Activity (in thousands) | Six months ended June 30, 2025 | Six months ended June 30, 2024 | | :-------------------------------- | :----------------------------- | :----------------------------- | | Net cash used in operating activities | $(8,072) | $(9,586) | | Net cash used in investing activities | $(46) | $(14) | | Net cash provided by financing activities | $10,487 | $8,095 | | NET CHANGE IN CASH AND CASH EQUIVALENTS | $2,369 | $(1,505) | | Cash and cash equivalents at end of period | $6,041 | $6,114 | - Net cash used in operating activities decreased by **$1,514 thousand**, from **$(9,586) thousand** in 2024 to **$(8,072) thousand** in 2025, primarily due to changes in operating assets and liabilities[25](index=25&type=chunk)[168](index=168&type=chunk)[169](index=169&type=chunk) - Net cash provided by financing activities increased by **$2,392 thousand**, from **$8,095 thousand** in 2024 to **$10,487 thousand** in 2025, driven by proceeds from Series A preferred stock issuance and common stock sales[25](index=25&type=chunk)[168](index=168&type=chunk)[172](index=172&type=chunk) [1. Organization, Business Overview and Liquidity](index=11&type=section&id=1.%20Organization,%20Business%20Overview%20and%20Liquidity) Describes the company's business, recent merger, and liquidity challenges, including going concern doubt - Serina Therapeutics, Inc. (formerly AgeX Therapeutics, Inc.) completed a reverse recapitalization merger with Legacy Serina on March 26, 2024, becoming a clinical-stage biotechnology company focused on neurological diseases and pain using its proprietary POZ drug delivery technology[27](index=27&type=chunk)[28](index=28&type=chunk)[29](index=29&type=chunk) - The company reported a net loss of **$11,300 thousand** and used **$8,100 thousand** in net cash from operating activities for the six months ended June 30, 2025, leading to substantial doubt about its ability to continue as a going concern[34](index=34&type=chunk)[35](index=35&type=chunk) - Management believes its **$6,000 thousand** cash and cash equivalents as of June 30, 2025, are insufficient to cover anticipated operating and funding requirements for the next twelve months, necessitating additional capital through equity investors, ATM offerings, or licensing agreements[35](index=35&type=chunk)[36](index=36&type=chunk) [2. Basis of Presentation and Summary of Significant Accounting Policies](index=12&type=section&id=2.%20Basis%20of%20Presentation%20and%20Summary%20of%20Significant%20Accounting%20Policies) Explains the financial statement preparation basis, consolidation policies, and recent accounting pronouncements - The unaudited condensed consolidated interim financial statements are prepared in accordance with U.S. GAAP and SEC interim reporting requirements, with certain information condensed or omitted[38](index=38&type=chunk) - The Company consolidates its wholly-owned subsidiaries (Legacy Serina) and NeuroAirmid (50% owned) due to contractual rights influencing decision-making, but deconsolidated UniverXome in December 2024 after its sale to Juvenescence[40](index=40&type=chunk)[43](index=43&type=chunk)[44](index=44&type=chunk)[45](index=45&type=chunk) - Recently adopted accounting pronouncements (ASU 2023-07, ASU 2023-09, ASU 2024-02) effective January 1, 2025, did not have a material impact on the financial statements[53](index=53&type=chunk)[54](index=54&type=chunk)[55](index=55&type=chunk) [3. Recapitalization](index=14&type=section&id=3.%20Recapitalization) Details the reverse recapitalization merger, its accounting treatment, and adjustments to equity and liabilities - The Merger on March 26, 2024, was accounted for as a reverse recapitalization, with Legacy Serina considered the accounting acquirer due to its stockholders holding a majority of voting rights, designating board members, and its management team leading the combined company[57](index=57&type=chunk) - AgeX issued **5,913,277 shares** of its common stock to Legacy Serina stockholders, and assumed Legacy Serina's 2017 Stock Option Plan, adjusting outstanding options and warrants[59](index=59&type=chunk)[60](index=60&type=chunk) Acquired Assets and Liabilities | Acquired Assets and Liabilities (in thousands) | Amount | | :--------------------------------------------- | :----- | | Cash and cash equivalents | $337 | | Other current assets | $174 | | Intangible assets | $576 | | Accounts payable and accrued expenses | $(2,830) | | Loan payable to Juvenescence | $(8,017) | | Net liabilities acquired | $(9,760) | | Conversion of AgeX-Serina Note | $10,721 | | Total net increase in additional paid-in capital | $961 | [4. Selected Balance Sheet Components](index=15&type=section&id=4.%20Selected%20Balance%20Sheet%20Components) Provides detailed breakdowns of specific balance sheet accounts like prepaid expenses and accrued liabilities Prepaid Expenses and Other Current Assets | Prepaid expenses and other current assets (in thousands) | June 30, 2025 | December 31, 2024 | | :------------------------------------------------------- | :------------ | :---------------- | | Prepaid technology access fee | $1,000 | $1,333 | | Prepaid insurance | $526 | $192 | | Other prepaid expenses | $247 | $402 | | Other current assets | $177 | $77 | | Total | $1,950 | $2,004 | Accrued Liabilities | Accrued liabilities (in thousands) | June 30, 2025 | December 31, 2024 | | :--------------------------------- | :------------ | :---------------- | | Research program and services | $669 | $329 | | Accrued compensation | $517 | $559 | | Accrued severance | $12 | $304 | | Other accrued expenses | $112 | $237 | | Total | $1,310 | $1,429 | - Property and equipment, net, increased from **$501 thousand** at December 31, 2024, to **$588 thousand** at June 30, 2025[64](index=64&type=chunk) [5. Related Party Transactions](index=16&type=section&id=5.%20Related%20Party%20Transactions) Describes transactions with related parties, including asset transfers and debt assumptions with Juvenescence - AgeX transferred assets and liabilities related to its subsidiaries Reverse Bio and ReCyte to UniverXome, which then assumed AgeX's obligations under convertible notes to Juvenescence, releasing AgeX from these debts[67](index=67&type=chunk)[68](index=68&type=chunk) - On December 23, 2024, the Company sold all outstanding shares of UniverXome to Juvenescence, which assumed approximately **$11,300 thousand** of secured debt, resulting in a **$10,900 thousand** capital contribution recognized by the Company[71](index=71&type=chunk) [6. Fair Value Measurements](index=17&type=section&id=6.%20Fair%20Value%20Measurements) Discusses the valuation of financial instruments, particularly warrant liabilities, and their impact on earnings Liabilities | Liabilities (in thousands) | June 30, 2025 | December 31, 2024 | | :------------------------- | :------------ | :---------------- | | Warrant liability | $3,549 | $3,582 | - The Company classifies Merger Warrants as liabilities, with changes in fair value recognized in the consolidated statements of operations. A **$1,000 thousand** loss was recognized for the three months ended June 30, 2025, compared to a **$9,300 thousand** gain in the prior year period[73](index=73&type=chunk) - The AgeX-Serina Note, initially valued at **$7,800 thousand**, was remeasured to **$10,700 thousand** at the Merger date and converted into equity, resulting in a **$7,000 thousand** loss from change in fair value for the six months ended June 30, 2024[78](index=78&type=chunk) [7. Stockholders' Equity](index=19&type=section&id=7.%20Stockholders'%20Equity) Covers changes in stockholders' equity, including preferred stock issuance, warrants, and at-the-market offerings - On April 8, 2025, the Company issued **965,250 shares** of Series A Convertible Preferred Stock for net proceeds of **$4,900 thousand**, with an 8% cumulative annual dividend payable in PIK Shares[79](index=79&type=chunk) - As of June 30, 2025, **366,658 Post-Merger Warrants** were outstanding, and Juvenescence held **377,865 Incentive Warrants** and **755,728 Replacement Incentive Warrants**, all classified as liabilities[83](index=83&type=chunk)[88](index=88&type=chunk)[89](index=89&type=chunk) - Through an at-the-market (ATM) program established on April 25, 2025, the Company sold **124,454 shares** of common stock, generating net proceeds of **$600 thousand** as of June 30, 2025[91](index=91&type=chunk) [8. Stock-Based Awards](index=21&type=section&id=8.%20Stock-Based%20Awards) Details the company's equity incentive plans and the recognition of stock-based compensation expense - The Company has four equity incentive plans: 2024 Inducement Equity Plan (**1,000,000 shares** reserved), 2024 Equity Incentive Plan (**2,675,000 shares** reserved), and assumed 2017 Stock Option Plan and 2017 Equity Incentive Plan from Legacy Serina/AgeX[92](index=92&type=chunk)[93](index=93&type=chunk)[94](index=94&type=chunk)[95](index=95&type=chunk) - Total stock-based compensation expense for the six months ended June 30, 2025, was **$1,846 thousand**, significantly higher than **$511 thousand** in the same period of 2024[97](index=97&type=chunk) - As of June 30, 2025, total unrecognized compensation cost related to unvested stock option grants was **$9,400 thousand**, expected to be recognized over a weighted average period of 2.6 years[96](index=96&type=chunk) [9. Profit Sharing Plan](index=22&type=section&id=9.%20Profit%20Sharing%20Plan) Describes the company's 401(k) profit sharing plan and employer contribution policies - The Company maintains a 401(k) profit sharing plan for eligible employees, with discretionary employer matching and profit sharing contributions based on a graded vesting schedule[98](index=98&type=chunk)[99](index=99&type=chunk) - No discretionary employer contributions were made for the three and six months ended June 30, 2025 and 2024[99](index=99&type=chunk) [10. Income Taxes](index=22&type=section&id=10.%20Income%20Taxes) Explains the company's income tax position, including the absence of tax provisions due to recurring losses - Due to recurring losses, the Company did not record a provision or benefit for income taxes for any periods presented[101](index=101&type=chunk) - A full valuation allowance has been established against all deferred tax assets due to the uncertainty of realizing future tax benefits[101](index=101&type=chunk) [11. Commitments and Contingencies](index=22&type=section&id=11.%20Commitments%20and%20Contingencies) Outlines lease obligations, development partnerships, and potential legal claims in the ordinary course of business - The Company leases lab and office facilities under non-cancelable operating lease agreements expiring between October 2025 and January 2028, with total undiscounted lease payments of **$391 thousand** as of June 30, 2025[103](index=103&type=chunk)[108](index=108&type=chunk) - In May 2024, the Company partnered with Enable Injections, Inc. to develop and commercialize SER-252 (POZ-apomorphine) for Parkinson's disease, with an Investigational New Drug (IND) application anticipated in 2025[113](index=113&type=chunk) - The Company is subject to various claims and indemnification obligations in the ordinary course of business but is not aware of any claims likely to have a material adverse effect on its financial condition or results of operations[109](index=109&type=chunk)[114](index=114&type=chunk) [12. Net (Loss) Income Per Common Share](index=27&type=section&id=12.%20Net%20(Loss)%20Income%20Per%20Common%20Share) Presents basic and diluted earnings per share calculations, including anti-dilutive securities EPS Metric | EPS Metric | Three months ended June 30, 2025 | Three months ended June 30, 2024 | Six months ended June 30, 2025 | Six months ended June 30, 2024 | | :--------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Basic EPS | $(0.66) | $0.61 | $(1.15) | $(1.74) | | Diluted EPS | $(0.66) | $0.51 | $(1.15) | $(1.74) | - For periods with net loss (three and six months ended June 30, 2025, and six months ended June 30, 2024), most outstanding stock options and warrants were excluded from diluted EPS calculation as their inclusion would be anti-dilutive[115](index=115&type=chunk) Anti-Dilutive Securities | Anti-Dilutive Securities (in thousands) | Three months ended June 30, 2025 | Three months ended June 30, 2024 | Six months ended June 30, 2025 | Six months ended June 30, 2024 | | :-------------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Series A preferred stock | 984 | — | 984 | — | | Stock options | 3,295 | 652 | 3,295 | 2,304 | | Warrants | 1,997 | 3,226 | 1,997 | 3,226 | | Total anti-dilutive securities | 6,276 | 3,878 | 6,276 | 5,530 | [13. Segment Reporting](index=27&type=section&id=13.%20Segment%20Reporting) Identifies the company's single reportable segment and its primary revenue and expense components - The Company operates as one reportable segment focused on the research and development of its POZ platform, with revenues derived from Grant revenue[116](index=116&type=chunk)[117](index=117&type=chunk) Segment Expenses | Segment Expenses (in thousands) | 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 | $3,152 | $1,594 | $6,103 | $2,700 | | General and administrative | $2,543 | $2,323 | $5,450 | $3,543 | | Total operating expenses | $5,695 | $3,917 | $11,553 | $6,243 | | Loss from operations | $(5,565) | $(3,866) | $(11,423) | $(6,187) | | Segment and consolidated net (loss) income | $(6,462) | $5,177 | $(11,284) | $(9,838) | [14. Subsequent Events](index=29&type=section&id=14.%20Subsequent%20Events) Reports significant events occurring after the reporting period, such as the establishment of a new subsidiary - On July 2, 2025, the Company established a new subsidiary, Serina Therapeutics Australia Pty Ltd, to conduct clinical research activities, which is not reflected in the current financial statements[121](index=121&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=30&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses the company's financial condition, operational results, and future outlook, emphasizing liquidity challenges [Overview](index=30&type=section&id=Overview) Provides a high-level summary of the company's business, financial performance, and going concern considerations - Serina Therapeutics is a clinical-stage biotechnology company developing drug candidates for neurological diseases and other indications, leveraging its POZ platform to improve drug efficacy and safety profiles[125](index=125&type=chunk) - The Company completed a merger on March 26, 2024, and has since incurred significant operating losses, with an accumulated deficit of **$55,600 thousand** and **$6,000 thousand** in cash and cash equivalents as of June 30, 2025[126](index=126&type=chunk) - Recurring losses and negative operating cash flows raise substantial doubt about the Company's ability to continue as a going concern, necessitating additional financing to fund future operations and product development[127](index=127&type=chunk)[129](index=129&type=chunk) [Critical Accounting Policies and Estimates](index=31&type=section&id=Critical%20Accounting%20Policies%20and%20Estimates) Affirms no significant changes to critical accounting policies and estimates from the prior annual report - Management believes there have been no significant changes to the critical accounting policies and estimates disclosed in the Annual Report on Form 10-K for the year ended December 31, 2024[131](index=131&type=chunk) [Components of Operating Results](index=31&type=section&id=Components%20of%20Operating%20Results) Explains the key drivers of grant revenues and operating expenses, including R&D and G&A costs - Grant revenues are recognized as allowable costs are incurred, and operating expenses primarily consist of research and development (R&D) and general and administrative (G&A) costs[132](index=132&type=chunk)[133](index=133&type=chunk) - R&D expenses, which are expensed as incurred, are expected to increase substantially due to investments in clinical trials, manufacturing, and advancing product candidates, including SER 252[137](index=137&type=chunk)[135](index=135&type=chunk) - G&A expenses are also projected to rise due to increased personnel costs, professional services, and compliance requirements associated with operating as a public company[143](index=143&type=chunk) [Results of Operations](index=34&type=section&id=Results%20of%20Operations) Compares financial performance for the current and prior periods, detailing changes in revenues and expenses Financial Performance Summary | Metric (in thousands) | Three months ended June 30, 2025 | Three months ended June 30, 2024 | Six months ended June 30, 2025 | Six months ended June 30, 2024 | | :-------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Grant revenues | $130 | $51 | $130 | $56 | | R&D expenses | $3,152 | $1,594 | $6,103 | $2,700 | | G&A expenses | $2,543 | $2,323 | $5,450 | $3,543 | | Loss from operations | $(5,565) | $(3,866) | $(11,423) | $(6,187) | | Other income (expense), net | $(897) | $9,043 | $139 | $(3,651) | | NET INCOME (LOSS) | $(6,462) | $5,177 | $(11,284) | $(9,838) | - Research and development expenses increased by **$1,558 thousand** for the three months and **$3,403 thousand** for the six months ended June 30, 2025, primarily due to higher outside research services, consultant spend, and compensation[149](index=149&type=chunk)[150](index=150&type=chunk) - General and administrative expenses increased by **$220 thousand** for the three months and **$1,907 thousand** for the six months ended June 30, 2025, driven by increased stock-based compensation, consulting expenses, and salaries[152](index=152&type=chunk)[153](index=153&type=chunk) - Other income (expense), net, shifted from a **$9,043 thousand** net income in Q2 2024 to a **$(897) thousand** net expense in Q2 2025, mainly due to a **$10,300 thousand** change in fair value of liability-classified warrants[154](index=154&type=chunk) [Liquidity and Capital Resources](index=35&type=section&id=Liquidity%20and%20Capital%20Resources) Assesses the company's cash position, funding sources, and future capital requirements amidst going concern doubt - As of June 30, 2025, the Company had **$6,000 thousand** in cash and cash equivalents, primarily financed by prior stock and convertible note issuances, Post-Merger warrant exercises, and recent Series A preferred stock and ATM common stock sales[157](index=157&type=chunk)[158](index=158&type=chunk)[160](index=160&type=chunk) - The Company's recurring losses and negative cash flows raise substantial doubt about its ability to continue as a going concern, with current cash not expected to fund operations for the next twelve months[162](index=162&type=chunk)[165](index=165&type=chunk) - Future funding requirements are significant and uncertain, depending on the progress of clinical trials, regulatory approvals, manufacturing, and intellectual property protection, necessitating additional capital through equity, debt, or collaborations[164](index=164&type=chunk)[165](index=165&type=chunk)[166](index=166&type=chunk)[167](index=167&type=chunk) Cash Flows | Cash Flows (in thousands) | Six months ended June 30, 2025 | Six months ended June 30, 2024 | $ Change | % Change | | :------------------------ | :----------------------------- | :----------------------------- | :------- | :------- | | Net cash used in operating activities | $(8,072) | $(9,586) | $1,514 | (15.8%) | | Net cash used in investing activities | $(46) | $(14) | $(32) | — % | | Net cash provided by financing activities | $10,487 | $8,095 | $2,392 | 29.5 % | | Net increase (decrease) in cash | $2,369 | $(1,505) | $3,874 | (257.4)% | [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=38&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) As a smaller reporting company, Serina Therapeutics, Inc. is exempt from providing market risk disclosures - The Company is a smaller reporting company and is not required to provide quantitative and qualitative disclosures about market risk[174](index=174&type=chunk) [Item 4. Controls and Procedures](index=38&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded disclosure controls were ineffective due to material weaknesses, with remediation ongoing - Disclosure controls and procedures were deemed ineffective as of June 30, 2025, due to material weaknesses[175](index=175&type=chunk) - Material weaknesses include insufficient qualified accounting personnel, lack of data validation, inadequate segregation of duties, substantial reliance on manual reporting, and lack of experience in monitoring internal controls[178](index=178&type=chunk) - Remediation efforts include hiring finance professionals, leveraging third-party consultants, developing standardized processes, and implementing IT system improvements, with full remediation still in progress[180](index=180&type=chunk)[181](index=181&type=chunk)[184](index=184&type=chunk) [PART II – OTHER INFORMATION](index=40&type=section&id=PART%20II%20%E2%80%93%20OTHER%20INFORMATION) This section provides additional information not covered in the financial statements, including legal, risk, and equity matters [Item 1. Legal Proceedings](index=40&type=section&id=Item%201.%20Legal%20Proceedings) The Company is not currently a party to any material legal proceedings, though it may face ordinary claims - The Company is not currently a party to any material legal proceedings[186](index=186&type=chunk) [Item 1A. Risk Factors](index=40&type=section&id=Item%201A.%20Risk%20Factors) No material changes to risk factors, except for new disclosures on ATM offerings and FDA approval unpredictability - No material changes to risk factors from the Annual Report on Form 10-K, except for new disclosures regarding potential stock price decline from 'at-the-market' offerings[187](index=187&type=chunk) - The FDA regulatory approval process is lengthy, unpredictable, and subject to delays, which could materially impact the Company's ability to commercialize product candidates[188](index=188&type=chunk)[189](index=189&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=40&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) Information regarding unregistered sales of equity securities and use of proceeds has been previously reported - Information on unregistered sales of equity securities and use of proceeds was previously reported[190](index=190&type=chunk) [Item 3. Default Upon Senior Securities](index=40&type=section&id=Item%203.%20Default%20Upon%20Senior%20Securities) The Company has not defaulted upon any senior securities - There has been no default upon senior securities[191](index=191&type=chunk) [Item 4. Mine Safety Disclosures](index=41&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) Mine safety disclosures are not applicable to the Company's operations - Mine safety disclosures are not applicable[192](index=192&type=chunk) [Item 5. Other Information](index=41&type=section&id=Item%205.%20Other%20Information) No directors or officers adopted or terminated Rule 10b5-1 or non-Rule 10b5-1 trading arrangements - No directors or officers adopted or terminated Rule 10b5-1 or non-Rule 10b5-1 trading arrangements during the three months ended June 30, 2025[193](index=193&type=chunk) [Item 6. Exhibits](index=41&type=section&id=Item%206.%20Exhibits) This section lists all exhibits filed with the Form 10-Q, including certificates of designations, a securities purchase agreement, certifications of the CEO and CFO, and Inline XBRL documents - The report includes various exhibits such as Certificate of Designations, Securities Purchase Agreement, Rule 13a-14(a)/15d-14(a) Certifications, Section 1350 Certification, and Inline XBRL documents[194](index=194&type=chunk)

Part I – FINANCIAL INFORMATION [Financial Statements](index=5&type=section&id=Item%201.%20Financial%20Statements) The company's net loss increased to $11.3 million in H1 2025, with a going concern qualification issued due to insufficient funding Condensed Consolidated Balance Sheet Highlights (in thousands) | Account | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Assets** | | | | Cash and cash equivalents | $6,041 | $3,672 | | Total current assets | $7,991 | $5,676 | | TOTAL ASSETS | $8,941 | $6,724 | | **Liabilities & Equity** | | | | Total current liabilities | $3,561 | $2,366 | | TOTAL LIABILITIES | $7,295 | $6,216 | | Total stockholders' equity | $1,646 | $508 | | TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | $8,941 | $6,724 | Condensed Consolidated Statements of Operations Highlights (in thousands, except per share data) | Metric | Six months ended June 30, 2025 | Six months ended June 30, 2024 | | :--- | :--- | :--- | | Total revenues | $130 | $56 | | Research and development | $6,103 | $2,700 | | General and administrative | $5,450 | $3,543 | | Loss from operations | $(11,423) | $(6,187) | | NET LOSS | $(11,284) | $(9,838) | | NET LOSS PER COMMON SHARE (BASIC & DILUTED) | $(1.15) | $(1.74) | 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 used in operating activities | $(8,072) | $(9,586) | | Net cash used in investing activities | $(46) | $(14) | | Net cash provided by financing activities | $10,487 | $8,095 | | NET CHANGE IN CASH AND CASH EQUIVALENTS | $2,369 | $(1,505) | - Management has concluded there is **substantial doubt about the Company's ability to continue as a going concern**, as cash and cash equivalents of **$6.0 million** are not expected to be sufficient to fund operations for the next twelve months[35](index=35&type=chunk)[37](index=37&type=chunk) [Note 1. Organization, Business Overview and Liquidity](index=11&type=section&id=Note%201.%20Organization%2C%20Business%20Overview%20and%20Liquidity) Serina is a clinical-stage biotechnology company that faces substantial doubt about its ability to continue as a going concern due to significant operating losses - The company's **POZ drug delivery technology** is designed to improve the efficacy and safety of existing drugs by enabling greater control in drug loading and precision in the rate of release[29](index=29&type=chunk) - On March 26, 2024, the company completed a **reverse merger** with AgeX Therapeutics, Inc, with Legacy Serina surviving as the primary business[27](index=27&type=chunk)[28](index=28&type=chunk) - The company's financial condition, including a **net loss of $11.3 million** for the six months ended June 30, 2025, and cash usage of **$8.1 million** in operating activities, has led to a going concern warning[34](index=34&type=chunk)[35](index=35&type=chunk) [Note 7. Stockholders' Equity](index=19&type=section&id=Note%207.%20Stockholders'%20Equity) The company raised capital through a $4.9 million private placement of preferred stock and initiated a $13.3 million At-the-Market (ATM) offering - On April 8, 2025, the company raised net proceeds of **$4.9 million** from a private placement of 965,250 shares of Series A Convertible Preferred Stock at $5.18 per share[79](index=79&type=chunk) - On April 25, 2025, the company initiated an At-the-Market (ATM) offering to sell up to **$13.3 million** of its common stock; as of June 30, 2025, it had sold 124,454 shares for net proceeds of **$0.6 million**[91](index=91&type=chunk) - The company has several classes of warrants outstanding, including Post-Merger Warrants and Incentive Warrants, which are classified as liabilities and subject to fair value adjustments[83](index=83&type=chunk)[86](index=86&type=chunk)[88](index=88&type=chunk) [Note 11. Commitments and Contingencies](index=22&type=section&id=Note%2011.%20Commitments%20and%20Contingencies) The company's commitments include operating leases totaling $0.4 million and a $2.0 million partnership with Enable Injections, Inc - In May 2024, the company partnered with Enable Injections, Inc to develop and commercialize SER-252 (POZ-apomorphine) for Parkinson's disease, paying **$2.0 million** for the arrangement[113](index=113&type=chunk) - The company leases its lab and office facilities under non-cancelable operating lease agreements expiring between October 2025 and January 2028[103](index=103&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=30&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Operating expenses increased significantly, and the company's cash position of $6.0 million is insufficient to fund operations for the next year Comparison of Operating Results (in thousands) | Period | Research & Development | General & Administrative | Loss from Operations | | :--- | :--- | :--- | :--- | | **Three months ended June 30, 2025** | $3,152 | $2,543 | $(5,565) | | **Three months ended June 30, 2024** | $1,594 | $2,323 | $(3,866) | | **Six months ended June 30, 2025** | $6,103 | $5,450 | $(11,423) | | **Six months ended June 30, 2024** | $2,700 | $3,543 | $(6,187) | - The increase in R&D expenses for H1 2025 was primarily due to a **$1.8 million increase in outside research services** and a **$1.3 million increase in salaries** and related costs from higher headcount[150](index=150&type=chunk)[151](index=151&type=chunk) - The increase in G&A expenses for H1 2025 was driven by a **$1.2 million increase in salaries and stock-based compensation** and a **$0.8 million increase in consulting fees** for finance functions[153](index=153&type=chunk) - The company's cash on hand of **$6.0 million is not sufficient** to fund operations for the next twelve months, necessitating additional capital raising to avoid curtailing planned operations[162](index=162&type=chunk)[165](index=165&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=38&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) As a smaller reporting company, Serina Therapeutics, Inc is not required to provide the information for this item - The company is not required to provide quantitative and qualitative disclosures about market risk because it qualifies as a **smaller reporting company**[174](index=174&type=chunk) [Controls and Procedures](index=38&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls were not effective as of June 30, 2025, due to several material weaknesses - Management determined that **disclosure controls and procedures were not effective** as of June 30, 2025[175](index=175&type=chunk) - Identified **material weaknesses** include insufficient qualified accounting personnel, lack of segregation of duties, reliance on manual reporting processes, and lack of experience in monitoring internal controls[178](index=178&type=chunk) - The company has begun a **remediation plan**, which includes hiring professionals with public company accounting experience and implementing enhanced processes and system automation[180](index=180&type=chunk)[184](index=184&type=chunk) Part II – OTHER INFORMATION [Legal Proceedings](index=40&type=section&id=Item%201.%20Legal%20Proceedings) As of the reporting date, the company is not a party to any material legal proceedings - The company is **not currently involved in any material legal proceedings**[186](index=186&type=chunk) [Risk Factors](index=40&type=section&id=Item%201A.%20Risk%20Factors) Key risks include potential stock price decline from the ATM offering and unpredictable FDA regulatory approval timelines - Sales of a substantial number of shares under the **$13.3 million ATM offering** could cause the company's stock price to decline[187](index=187&type=chunk) - The company faces risks from the inherently unpredictable and lengthy **FDA regulatory approval process**, which could be impacted by external factors like government agency disruptions[188](index=188&type=chunk)[189](index=189&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=40&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) Information regarding unregistered sales of equity securities has been previously reported - This item was **previously reported**[190](index=190&type=chunk) [Other Information](index=41&type=section&id=Item%205.%20Other%20Information) During the second quarter of 2025, none of the company's directors or officers adopted or terminated a Rule 10b5-1 trading arrangement - No directors or officers adopted or terminated a **Rule 10b5-1 trading plan** during the three months ended June 30, 2025[193](index=193&type=chunk) [Exhibits](index=41&type=section&id=Item%206.%20Exhibits) This section lists the exhibits filed with the Form 10-Q, including certifications and agreements related to recent securities purchases - A list of exhibits filed with the report is provided, including the Certificate of Designations for the Series A Preferred Stock and the associated Securities Purchase Agreement[194](index=194&type=chunk)

[Executive Summary](index=1&type=section&id=1.%20Executive%20Summary) Xenon Pharmaceuticals reported Q2 2025 financial results and business updates, highlighting significant clinical progress and pipeline advancements [Second Quarter 2025 Financial Results & Business Update](index=1&type=section&id=1.1%20Second%20Quarter%202025%20Financial%20Results%20%26%20Business%20Update) Xenon Pharmaceuticals reported its financial results for the second quarter ended June 30, 2025, alongside a comprehensive business update, highlighting significant progress in its clinical development programs and early-stage pipeline - Xenon Pharmaceuticals Inc. reported financial results for Q2 2025 and provided a business update[3](index=3&type=chunk) [CEO Statement](index=1&type=section&id=1.2%20CEO%20Statement) CEO Ian Mortimer announced completed patient recruitment for azetukalner's Phase 3 X-TOLE2 study, with early 2026 results expected, and highlighted progress in other Phase 3 and early-stage programs - Patient recruitment for Phase 3 X-TOLE2 study of azetukalner is complete, with topline results expected in early 2026[4](index=4&type=chunk) - Phase 3 programs for azetukalner are underway in bipolar depression (X-CEED) and major depressive disorder (X-NOVA)[4](index=4&type=chunk) - Two first-in-human studies are ongoing within the Kv7 and Nav1.7 early-stage programs, targeting epilepsy, depression, and pain[4](index=4&type=chunk) [Business Highlights and Clinical Development](index=1&type=section&id=2.%20Business%20Highlights%20and%20Clinical%20Development) This section details Xenon's clinical development progress for azetukalner across epilepsy and neuropsychiatric programs, alongside early-stage pipeline advancements and corporate updates [Azetukalner Clinical Development](index=1&type=section&id=2.1%20Azetukalner%20Clinical%20Development) Azetukalner, a Kv7 potassium channel opener, is Xenon's most advanced clinical asset, with significant progress across its Phase 3 programs for epilepsy and neuropsychiatric disorders, including completed recruitment for a pivotal epilepsy study and initiation of multiple studies for depression - Azetukalner is a novel, highly potent, selective Kv7 potassium channel opener in late-stage clinical development for multiple indications[5](index=5&type=chunk) [Epilepsy Programs](index=1&type=section&id=2.1.1%20Epilepsy%20Programs) The Phase 3 X-TOLE2 study for focal onset seizures (FOS) has completed patient recruitment, with topline data expected in early 2026, while enrollment continues for the X-TOLE3 FOS study and the X-ACKT study for primary generalized tonic-clonic seizures (PGTCS) - Phase 3 X-TOLE2 clinical study of azetukalner in FOS has completed patient recruitment; topline data anticipated in early 2026[7](index=7&type=chunk)[8](index=8&type=chunk) - Phase 3 X-TOLE3 clinical study in FOS and X-ACKT clinical study in PGTCS continue to enroll patients[8](index=8&type=chunk)[13](index=13&type=chunk) - Four abstracts related to epilepsy were accepted for presentation at the 36th International Epilepsy Congress (IEC)[13](index=13&type=chunk) [Neuropsychiatric Programs](index=2&type=section&id=2.1.2%20Neuropsychiatric%20Programs) Xenon has initiated Phase 3 clinical trials for azetukalner in major depressive disorder (MDD) with X-NOVA2 and X-NOVA3, and in bipolar depression (BPD) with the X-CEED study - X-NOVA2 and X-NOVA3, the first two of three planned Phase 3 clinical trials for azetukalner in MDD, are underway and screening patients[7](index=7&type=chunk)[13](index=13&type=chunk) - X-CEED, the first of two planned Phase 3 clinical studies for azetukalner in BPD I and BPD II depression, has been initiated[7](index=7&type=chunk)[13](index=13&type=chunk) [Early-Stage Pipeline: Next-Generation Ion Channel Modulators](index=2&type=section&id=2.2%20Early-Stage%20Pipeline%3A%20Next-Generation%20Ion%20Channel%20Modulators) Xenon is actively expanding its early-stage portfolio, leveraging expertise in potassium and sodium channel therapeutics with a goal to file multiple INDs in 2025, including Phase 1 studies for Kv7 and Nav1.7 channel openers for pain, and IND-enabling studies for a Nav1.1 candidate for Dravet Syndrome - Xenon aims to file multiple INDs (or equivalent) in 2025, leveraging expertise in potassium and sodium channel therapeutics[9](index=9&type=chunk) - Phase 1 studies are underway for XEN1120 (Kv7 channel opener) and XEN1701 (Nav1.7 development candidate) for pain[7](index=7&type=chunk)[13](index=13&type=chunk) - Nav1.1 lead candidate is expected to enter IND-enabling studies in 2025, targeting Dravet Syndrome[13](index=13&type=chunk) [Partnered Program](index=2&type=section&id=2.3%20Partnered%20Program) A Phase 1 study is ongoing for NBI-921355, a selective inhibitor of voltage-gated sodium channels Nav1.2 and Nav1.6, developed in collaboration with Neurocrine Biosciences for certain types of epilepsy - A Phase 1 study is underway for NBI-921355, a selective inhibitor of Nav1.2 and Nav1.6, in collaboration with Neurocrine Biosciences for epilepsy[10](index=10&type=chunk) [Corporate Updates](index=2&type=section&id=2.4%20Corporate%20Updates) Xenon appointed Darren Cline as Chief Commercial Officer to lead the company's transition to a commercial-stage entity in anticipation of azetukalner's launch, and also plans to host R&D webinars focusing on its early-stage pipeline - Darren Cline was appointed Chief Commercial Officer to lead the commercial build and anticipated launch of azetukalner[7](index=7&type=chunk)[11](index=11&type=chunk) - Xenon plans to host multiple R&D webinars, with the first on October 2, 2025, focusing on pain treatments targeting Nav1.7 and Kv7[13](index=13&type=chunk) [Second Quarter Financial Performance](index=2&type=section&id=3.%20Second%20Quarter%20Financial%20Performance) This section details Xenon's Q2 2025 financial results, including cash position, R&D expenses, G&A expenses, other income, and net loss [Cash Position and Runway](index=2&type=section&id=3.1%20Cash%20Position%20and%20Runway) Xenon's cash, cash equivalents, and marketable securities totaled **$624.8 million** as of June 30, 2025, a decrease from **$754.4 million** at December 31, 2024, with the company anticipating this cash position will fund operations into 2027 Cash and Marketable Securities (in thousands of U.S. dollars) | Metric | June 30, 2025 | December 31, 2024 | Change | | :------------------------------------------ | :------------ | :------------------ | :----- | | Cash and cash equivalents and marketable securities (current) | $487,545 | $626,905 | $(139,360) | | Marketable securities (long-term) | $137,297 | $127,496 | $9,801 | | **Total Cash and Marketable Securities** | **$624,842** | **$754,401** | **$(129,559)** | - Based on current operating plans, Xenon anticipates having sufficient cash to fund operations into 2027[12](index=12&type=chunk) [Research and Development Expenses](index=3&type=section&id=3.2%20Research%20and%20Development%20Expenses) Research and development expenses significantly increased to **$75.0 million** for Q2 2025, up **$25.3 million** from **$49.7 million** in Q2 2024, primarily due to ongoing azetukalner Phase 3 clinical trials in epilepsy and MDD, start-up costs for the BPD trial, and increased personnel-related costs Research and Development Expenses (in thousands of U.S. dollars) | Period | Q2 2025 | Q2 2024 | Change (YoY) | | :----- | :------ | :------ | :----------- | | R&D Expenses | $74,985 | $49,702 | +$25,283 | - The increase was primarily attributable to ongoing azetukalner Phase 3 clinical trials in epilepsy and MDD, start-up costs for the BPD clinical trial, and increased personnel-related costs[18](index=18&type=chunk) [General and Administrative Expenses](index=3&type=section&id=3.3%20General%20and%20Administrative%20Expenses) General and administrative expenses remained relatively stable at **$19.2 million** for Q2 2025, compared to **$19.4 million** for the same period in 2024 General and Administrative Expenses (in thousands of U.S. dollars) | Period | Q2 2025 | Q2 2024 | Change (YoY) | | :----- | :------ | :------ | :----------- | | G&A Expenses | $19,244 | $19,402 | $(158) | [Other Income](index=3&type=section&id=3.4%20Other%20Income) Other income decreased by **$2.0 million** to **$8.9 million** for Q2 2025, down from **$10.8 million** in Q2 2024, mainly due to lower interest income, partially offset by an increase in foreign exchange gain Other Income (in thousands of U.S. dollars) | Period | Q2 2025 | Q2 2024 | Change (YoY) | | :----- | :------ | :------ | :----------- | | Other Income | $8,897 | $10,847 | $(1,950) | - The decrease was primarily attributable to lower interest income, partially offset by an increase in foreign exchange gain[18](index=18&type=chunk) [Net Loss](index=3&type=section&id=3.5%20Net%20Loss) The net loss for Q2 2025 increased to **$84.7 million**, compared to **$57.9 million** for the same period in 2024, primarily driven by higher research and development expenses and lower interest income Net Loss (in thousands of U.S. dollars, except per share amounts) | Metric | Q2 2025 | Q2 2024 | Change (YoY) | | :-------------------------- | :------ | :------ | :----------- | | Net Loss | $(84,706) | $(57,924) | $(26,782) | | Net Loss per Common Share | $(1.07) | $(0.75) | $(0.32) | - The increase in net loss was primarily attributable to higher research and development expenses driven by the azetukalner program, increased personnel-related costs, and lower interest income[18](index=18&type=chunk) [Detailed Clinical Program Descriptions](index=3&type=section&id=4.%20Detailed%20Clinical%20Program%20Descriptions) This section provides in-depth details on the design and primary endpoints of azetukalner's Phase 3 clinical programs for epilepsy, major depressive disorder, and bipolar depression [Azetukalner Phase 3 Epilepsy Program Details](index=3&type=section&id=4.1%20Azetukalner%20Phase%203%20Epilepsy%20Program%20Details) Xenon's Phase 3 epilepsy program for azetukalner includes three clinical trials for focal onset seizures (FOS) and primary generalized tonic-clonic seizures (PGTCS), which are randomized, double-blind, placebo-controlled studies evaluating **15 mg or 25 mg** of azetukalner as adjunctive treatment, with the primary endpoint being the median percent change in monthly seizure frequency - The Phase 3 epilepsy program includes three clinical trials for FOS and PGTCS, designed after the Phase 2b X-TOLE trial[15](index=15&type=chunk) - X-TOLE trials for FOS evaluate **15 mg or 25 mg of azetukalner** in approximately **360 patients**, with the primary endpoint being median percent change in monthly seizure frequency[15](index=15&type=chunk) - X-ACKT for PGTCS evaluates **25 mg of azetukalner** in approximately **160 patients**, with a similar primary efficacy endpoint[15](index=15&type=chunk) [Azetukalner Phase 3 MDD X-NOVA Program Details](index=3&type=section&id=4.2%20Azetukalner%20Phase%203%20MDD%20X-NOVA%20Program%20Details) The Phase 3 MDD program for azetukalner consists of three multicenter, randomized, double-blind, placebo-controlled trials, each evaluating **20 mg** of azetukalner as monotherapy in approximately **450 patients** with moderate-to-severe MDD, with the primary efficacy endpoint being the change from baseline in HAM-D17 score at week 6 - The Phase 3 MDD program includes three multicenter, randomized, double-blind, placebo-controlled clinical trials[16](index=16&type=chunk) - Studies evaluate **20 mg of azetukalner** as monotherapy in approximately **450 patients** with moderate-to-severe MDD[16](index=16&type=chunk) - The primary efficacy endpoint is the change from baseline in the HAM-D17 score at week 6[16](index=16&type=chunk) [Azetukalner Phase 3 BPD X-CEED Program Details](index=3&type=section&id=4.3%20Azetukalner%20Phase%203%20BPD%20X-CEED%20Program%20Details) Xenon's Phase 3 BPD program for azetukalner involves two multicenter, randomized, double-blind, placebo-controlled clinical trials, assessing **20 mg** of azetukalner as monotherapy in approximately **400 patients** with bipolar depression (BPD) I or II, with the primary efficacy endpoint being the change from baseline in the MADRS score at week 6 - The Phase 3 BPD program includes two multicenter, randomized, double-blind, placebo-controlled clinical trials[17](index=17&type=chunk) - Studies evaluate **20 mg of azetukalner** as monotherapy in approximately **400 patients** with BPD I or II[17](index=17&type=chunk) - The primary efficacy endpoint is the change from baseline in the MADRS score at week 6[17](index=17&type=chunk) [Company Overview and Investor Information](index=3&type=section&id=5.%20Company%20Overview%20and%20Investor%20Information) This section provides an overview of Xenon Pharmaceuticals, details conference call information, includes a safe harbor statement, and lists contact information [About Xenon Pharmaceuticals Inc.](index=4&type=section&id=5.1%20About%20Xenon%20Pharmaceuticals%20Inc.) Xenon Pharmaceuticals is a neuroscience-focused biopharmaceutical company dedicated to drug discovery, clinical development, and commercialization, with its lead molecule, azetukalner, in Phase 3 trials for epilepsy, MDD, and BPD, complemented by an early-stage pipeline of potassium and sodium channel modulators for pain - Xenon Pharmaceuticals is a neuroscience-focused biopharmaceutical company[19](index=19&type=chunk) - Azetukalner, a Kv7 potassium channel opener, is in Phase 3 clinical trials for epilepsy, MDD, and BPD[19](index=19&type=chunk) - The company is also advancing an early-stage portfolio of Kv7 and Nav1.7 programs in Phase 1 development for pain[19](index=19&type=chunk) [Conference Call Information](index=3&type=section&id=5.2%20Conference%20Call%20Information) Xenon hosted a conference call and webcast on August 11, 2025, at 4:30 pm ET to discuss its second quarter 2025 results, with replay access available on the Investors section of the company's website - Xenon hosted a conference call and webcast on August 11, 2025, at 4:30 pm ET to discuss Q2 2025 results[14](index=14&type=chunk) - A listen-only webcast can be accessed on the Investors section of the Xenon website, with a replay available[14](index=14&type=chunk) [Safe Harbor Statement](index=4&type=section&id=5.3%20Safe%20Harbor%20Statement) This section contains forward-looking statements regarding clinical trial timing and results, product candidate efficacy, regulatory success, and commercial potential, cautioning readers about inherent risks and uncertainties that could cause actual results to differ materially from projections - The press release contains forward-looking statements regarding clinical trials, product efficacy, regulatory approvals, and commercial potential[20](index=20&type=chunk) - These statements are subject to risks and uncertainties, including potential failures in clinical trials, incorrect assumptions on funding, and regulatory delays[20](index=20&type=chunk) - Readers are cautioned not to place undue reliance on forward-looking statements, and the company assumes no obligation to update them[20](index=20&type=chunk) [Contacts](index=5&type=section&id=5.4%20Contacts) Contact information for investor relations and media inquiries is provided for Xenon Pharmaceuticals Inc - Contact details for Investor Relations (Chad Fugere) and Corporate Affairs (Colleen Alabiso) are provided[22](index=22&type=chunk) [Condensed Consolidated Financial Statements](index=6&type=section&id=6.%20Condensed%20Consolidated%20Financial%20Statements) This section presents Xenon's condensed consolidated balance sheets and statements of operations and comprehensive loss for the reported periods [Condensed Consolidated Balance Sheets](index=6&type=section&id=6.1%20Condensed%20Consolidated%20Balance%20Sheets) The balance sheet shows a decrease in total assets and shareholders' equity from December 31, 2024, to June 30, 2025, primarily driven by a reduction in cash and marketable securities, while total liabilities also saw a slight decrease Condensed Consolidated Balance Sheets (in thousands of U.S. dollars) | Metric | June 30, 2025 | December 31, 2024 | | :------------------------------------------ | :------------ | :------------------ | | Cash and cash equivalents and marketable securities (current) | $487,545 | $626,905 | | Other current assets | $12,707 | $8,359 | | Marketable securities, long-term | $137,297 | $127,496 | | Other long-term assets | $36,732 | $35,379 | | **Total assets** | **$674,281** | **$798,139** | | Accounts payable and accrued liabilities | $31,588 | $34,221 | | Other current liabilities | $1,459 | $1,369 | | Other long-term liabilities | $7,256 | $7,646 | | **Total liabilities** | **$40,303** | **$43,236** | | **Shareholders' equity** | **$633,978** | **$754,903** | | **Total liabilities and shareholders' equity** | **$674,281** | **$798,139** | [Condensed Consolidated Statements of Operations and Comprehensive Loss](index=6&type=section&id=6.2%20Condensed%20Consolidated%20Statements%20of%20Operations%20and%20Comprehensive%20Loss) The statements show an increased net loss for both the three and six months ended June 30, 2025, primarily driven by higher research and development expenses, with revenue remaining at zero for the quarter but showing **$7.5 million** for the six-month period in 2025 Condensed Consolidated Statements of Operations and Comprehensive Loss (in thousands of U.S. dollars, except per share amounts) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :------------------------------------------ | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Revenue | $— | $— | $7,500 | $— | | Research and development | $74,985 | $49,702 | $136,185 | $93,952 | | General and administrative | $19,244 | $19,402 | $38,282 | $34,193 | | **Total operating expenses** | **$94,229** | **$69,104** | **$174,467** | **$128,145** | | Loss from operations | $(94,229) | $(69,104) | $(166,967) | $(128,145) | | Other income | $8,897 | $10,847 | $17,015 | $22,369 | | Net loss | $(84,706) | $(57,924) | $(149,753) | $(105,855) | | Net loss per common share: Basic and diluted | $(1.07) | $(0.75) | $(1.90) | $(1.36) | | Weighted average common shares outstanding: Basic and diluted | 78,953,445 | 77,671,128 | 78,820,474 | 77,632,864 |

[PART I. FINANCIAL INFORMATION](index=10&type=section&id=PART%20I.%20FINANCIAL%20INFORMATION) [Condensed Consolidated Financial Statements (Unaudited)](index=10&type=section&id=Item%201.%20Condensed%20Consolidated%20Financial%20Statements%20(Unaudited)) This section presents the company's unaudited condensed consolidated financial statements for the quarterly period ended June 30, 2025 [Condensed Consolidated Balance Sheets](index=11&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) Total assets slightly increased to $3.09 billion, while total liabilities decreased to $1.44 billion as of June 30, 2025 Condensed Consolidated Balance Sheet Highlights (in thousands) | Account | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Assets** | | | | Cash and cash equivalents | $21,853 | $86,649 | | Total current assets | $122,216 | $195,012 | | Total crude oil and natural gas properties, net | $2,943,774 | $2,845,729 | | **Total assets** | **$3,089,453** | **$3,063,288** | | **Liabilities & Equity** | | | | Total current liabilities | $140,685 | $284,630 | | Long-term debt, net | $1,027,354 | $928,384 | | **Total liabilities** | **$1,435,367** | **$1,460,832** | | **Total stockholders' equity** | **$1,654,086** | **$1,602,456** | [Condensed Consolidated Statements of Operations](index=12&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) Net income for Q2 2025 decreased to $26.2 million from $29.7 million year-over-year, driven by lower operating revenues Key Performance Indicators - Three Months Ended June 30 (in thousands, except per share data) | Metric | 2025 | 2024 | | :--- | :--- | :--- | | Total operating revenues | $200,400 | $275,266 | | Income from operations | $43,444 | $87,260 | | Gain (loss) on derivative instruments, net | $26,446 | $(2,702) | | Net income | $26,176 | $29,717 | | Diluted EPS | $0.19 | $0.21 | Key Performance Indicators - Six Months Ended June 30 (in thousands, except per share data) | Metric | 2025 | 2024 | | :--- | :--- | :--- | | Total operating revenues | $457,848 | $563,030 | | Income from operations | $133,823 | $190,280 | | Gain (loss) on derivative instruments, net | $18,519 | $(55,745) | | Net income | $62,511 | $36,155 | | Diluted EPS | $0.45 | $0.25 | [Condensed Consolidated Statements of Cash Flows](index=14&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Net cash from operations decreased to $298.3 million for the first six months of 2025, contributing to a $64.8 million net decrease in cash Cash Flow Summary - Six Months Ended June 30 (in thousands) | Cash Flow Category | 2025 | 2024 | | :--- | :--- | :--- | | Net cash provided by operating activities | $298,265 | $373,770 | | Net cash used in investing activities | $(322,078) | $(324,612) | | Net cash used in financing activities | $(40,983) | $(85,762) | | **Net decrease in cash and cash equivalents** | **$(64,796)** | **$(36,604)** | [Notes to Condensed Consolidated Financial Statements](index=15&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) The notes detail accounting policies, derivative instruments, debt structure, and significant subsequent events like credit agreement amendments - The company utilizes various derivative instruments to hedge against commodity price volatility, with a fair value net asset of **$16.4 million** as of June 30, 2025[89](index=89&type=chunk)[94](index=94&type=chunk)[163](index=163&type=chunk) - As of June 30, 2025, the company had **$1.02 billion** outstanding under its Term Loan Credit Agreement and **$30.0 million** under its Senior Credit Facility Agreement[97](index=97&type=chunk) - Subsequent to quarter-end, the company amended its credit agreements, extending maturities to 2028, upsizing the term loan to **$1.2 billion**, and deferring amortization payments[140](index=140&type=chunk) - The company has a crude oil marketing contract with a remaining monetary commitment of approximately **$123.9 million** as of June 30, 2025[116](index=116&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=41&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses financial performance, operational results, liquidity, and capital resources amid volatile market conditions [Overview and Recent Events](index=41&type=section&id=Overview%20and%20Recent%20Events) The company operates in the Midland Basin and recently amended its debt facilities to enhance liquidity and defer principal payments - As of June 30, 2025, the company's assets consisted of approximately **143,826 net acres** in the Midland Basin, with an average working interest of **93%**[145](index=145&type=chunk) - In August 2025, the company amended its credit agreements to extend maturities to 2028, upsize its Term Loan to **$1.2 billion**, and defer **$30.0 million** in quarterly amortization payments for one year[146](index=146&type=chunk) [Industry Considerations and Outlook](index=42&type=section&id=Industry%20Considerations%20and%20Outlook) The company anticipates continued price volatility due to market factors and maintains a flexible one to two drilling rig program - The market environment is influenced by OPEC's production decisions, US tariffs, and geopolitical instability, leading to **significant price volatility**[150](index=150&type=chunk)[152](index=152&type=chunk) - The company plans to average a **one to two (1-2) drilling rig program** for the remainder of 2025, maintaining flexibility in its capital plan[157](index=157&type=chunk) [Results of Operations](index=49&type=section&id=Results%20of%20Operations) Q2 2025 revenues decreased 27% year-over-year due to lower realized prices, despite flat sales volumes and reduced DD&A expenses Average Daily Sales Volumes | Product | Q2 2025 | Q2 2024 | % Change | | :--- | :--- | :--- | :--- | | Crude Oil (Bbls) | 33,913 | 37,073 | (9)% | | NGL (Bbls) | 7,462 | 6,018 | 24% | | Natural Gas (Mcf) | 43,642 | 32,640 | 34% | | **Total (Boe)** | **48,649** | **48,531** | **0%** | Weighted Average Realized Prices (excluding derivatives) | Product | Q2 2025 | Q2 2024 | % Change | | :--- | :--- | :--- | :--- | | Crude Oil per Bbl | $63.74 | $81.39 | (22)% | | NGL per Bbl | $20.34 | $20.32 | 0% | | Natural Gas per Mcf | $1.50 | $0.13 | 1,054% | | **Total per Boe** | **$45.27** | **$62.33** | **(27)%** | Key Operating Costs per Boe | Cost Category | Q2 2025 | Q2 2024 | % Change | | :--- | :--- | :--- | :--- | | Production Costs (excl. workovers) | $6.55 | $6.79 | (4)% | | DD&A Expense | $22.87 | $28.91 | (21)% | | G&A Expense | $1.28 | $1.07 | 20% | [Liquidity and Capital Resources](index=54&type=section&id=Liquidity%20and%20Capital%20Resources) Liquidity is sourced from operations and credit facilities, with a 2025 capital budget of $375-$405 million for drilling and completions - The 2025 capital budget is expected to be approximately **$375 to $405 million** for drilling and completion, plus additional funds for infrastructure[184](index=184&type=chunk) Cash Flow Summary - Six Months Ended June 30 (in thousands) | Category | 2025 | 2024 | | :--- | :--- | :--- | | Net cash provided by operating activities | $298,265 | $373,770 | | Net cash used in investing activities | $(322,078) | $(324,612) | | Net cash used in financing activities | $(40,983) | $(85,762) | [Quantitative and Qualitative Disclosures About Market Risk](index=60&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company's primary market risks are commodity price and interest rate volatility, which are partially managed through derivatives - A **$1.00 per barrel change** in the weighted average crude oil price would have impacted annualized revenues by approximately **$14.0 million** for the six months ended June 30, 2025[203](index=203&type=chunk) - A **1% increase in interest rates** on outstanding debt would result in an annual increase in interest expense of approximately **$10.5 million**[211](index=211&type=chunk) - The company uses commodity derivative instruments to hedge price risk, as required by its credit agreements, to provide cash flow certainty[204](index=204&type=chunk) [Controls and Procedures](index=62&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were effective as of June 30, 2025, with no material changes to internal controls - The principal executive and financial officers concluded that the company's **disclosure controls and procedures were effective** as of the end of the period[212](index=212&type=chunk) - **No material changes** in internal control over financial reporting occurred during the quarter ended June 30, 2025[213](index=213&type=chunk) [PART II. OTHER INFORMATION](index=62&type=section&id=PART%20II.%20OTHER%20INFORMATION) [Legal Proceedings](index=62&type=section&id=Item%201.%20Legal%20Proceedings) The company is involved in routine legal proceedings that are not expected to have a material adverse financial impact - The company states that while it is party to various legal proceedings, it does not expect the outcomes to have a **material adverse effect** on its financial condition[215](index=215&type=chunk) [Risk Factors](index=62&type=section&id=Item%201A.%20Risk%20Factors) Key risks include commodity price volatility, trade policy impacts, capital intensity, inflation, and geopolitical instability - Key risks include: - **Commodity Price Volatility:** Sustained price declines could adversely affect business and financial condition - **Tariffs and Trade Policy:** Trade restrictions could increase costs and disrupt the supply chain - **Capital Needs:** Development projects require substantial capital, and financing ability is uncertain - **Inflation and Costs:** Rising inflation may increase capital and operating costs, impacting profitability - **Geopolitical Risks:** Political instability in energy-producing regions can impact global supply and prices - **Strategic Alternatives Process:** The ongoing evaluation creates uncertainty and may not result in a transaction[217](index=217&type=chunk)[219](index=219&type=chunk)[224](index=224&type=chunk)[233](index=233&type=chunk)[237](index=237&type=chunk)[241](index=241&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=70&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) No common stock was repurchased in Q2 2025, with $39.9 million remaining under the authorized repurchase program - The company **did not repurchase any of its common stock** during the three months ended June 30, 2025[246](index=246&type=chunk) - As of June 30, 2025, approximately **$39.9 million remained available** under the company's stock repurchase program, which expires on December 31, 2025[246](index=246&type=chunk)[248](index=248&type=chunk) [Other Information](index=70&type=section&id=Item%205.%20Other%20Information) No directors or officers adopted or terminated Rule 10b5-1 trading arrangements during the quarter - No director or officer of the Company adopted or terminated a **Rule 10b5-1 trading arrangement** during the quarter[249](index=249&type=chunk) [Exhibits](index=71&type=section&id=Item%206.%20Exhibits) This section lists all exhibits filed with the report, including debt agreements and required officer certifications

BioHarvest Sciences Inc. Unaudited Interim Condensed Consolidated Financial Statements For the Three and Six Months Ended June 30, 2025 Expressed in U.S. dollars in thousands BioHarvest Sciences Inc. Unaudited Interim Condensed Consolidated Financial Statements For the Three and Six Months Ended June 30, 2025 Expressed in U.S. dollars in thousands TABLE OF CONTENTS | Page | | | --- | --- | | FINANCIAL STATEMENTS: | | | Unaudited Interim Condensed Consolidated Statements of Financial Position | 3 | | Unaudit ...

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 2025 OR ¨ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Commission File Number: 814-00646 MIDCAP FINANCIAL INVESTMENT CORPORATION (Exact name of Registrant as specified in its charter) Maryland 52-2439556 (State or other jurisdiction of in ...

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 2025 OR ¨ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Commission File Number: 814-00646 MIDCAP FINANCIAL INVESTMENT CORPORATION (Exact name of Registrant as specified in its charter) Maryland 52-2439556 (State or other jurisdiction of in ...

[Executive Summary & Financial Highlights](index=1&type=section&id=Executive%20Summary%20%26%20Financial%20Highlights) [Q2 2025 Consolidated Financial Highlights](index=1&type=section&id=Financial%20Highlights%3A%20Q2%202025%20Consolidated%20Results) iHeartMedia reported solid Q2 2025 consolidated results, with slight revenue growth, a significant improvement in GAAP Operating Income from a loss to a profit, and an increase in Adjusted EBITDA | Metric | Q2 2025 (in millions) | Q2 2024 (in millions) | Change (%) | | :-------------------------------- | :-------------------- | :-------------------- | :--------- | | Revenue | $934M | $929M | 0.5% | | Revenue (Excl. Political) | - | - | 1.5% | | GAAP Operating Income (Loss) | $35M | ($910M) | N/A | | Consolidated Adjusted EBITDA | $156M | $150M | 3.9% | | Cash provided by operating activities | $7M | - | N/A | | Free Cash Flow | ($13M) | - | N/A | | Cash balance (as of Jun 30, 2025) | $236M | - | N/A | | Total available liquidity (as of Jun 30, 2025) | $527M | - | N/A | [Q2 2025 Digital Audio Group Highlights](index=1&type=section&id=Financial%20Highlights%3A%20Q2%202025%20Digital%20Audio%20Group%20Results) The Digital Audio Group demonstrated strong performance in Q2 2025, driven by significant growth in podcast revenue and overall digital advertising demand, leading to increased Adjusted EBITDA and margin expansion | Metric | Q2 2025 (in millions) | Change (%) | | :-------------------------------- | :-------------------- | :--------- | | Digital Audio Group Revenue | $324M | 13% | | Podcast Revenue | $134M | 28% | | Digital Revenue excluding Podcast | $190M | 5% | | Segment Adjusted EBITDA | $108M | 17% | | Digital Audio Group Adjusted EBITDA margin | 33.2% | N/A | [Q2 2025 Multiplatform Group Highlights](index=1&type=section&id=Financial%20Highlights%3A%20Q2%202025%20Multiplatform%20Group%20Results) The Multiplatform Group experienced a decline in Q2 2025 revenue and Adjusted EBITDA, primarily due to a decrease in broadcast advertising | Metric | Q2 2025 (in millions) | Change (%) | | :-------------------------------- | :-------------------- | :--------- | | Multiplatform Group Revenue | $545M | (5%) | | Multiplatform Group Revenue (Excl. Political) | - | (5%) | | Segment Adjusted EBITDA | $96M | (8%) | | Multiplatform Group Adjusted EBITDA margin | 17.7% | N/A | [Q3 2025 Guidance](index=1&type=section&id=Financial%20Highlights%3A%20Guidance) For Q3 2025, iHeartMedia anticipates a low-single digit decline in consolidated revenue, but an increase when excluding political revenue, and a target range for Consolidated Adjusted EBITDA - Q3 Consolidated Revenue is expected to decline **low-single digits**, but increase in the **low-single digits** excluding the impact of Political Revenue[4](index=4&type=chunk) - Q3 Consolidated Adjusted EBITDA is expected to be approximately **$180 million to $220 million**[4](index=4&type=chunk) [Statement from Senior Management](index=2&type=section&id=Statement%20from%20Senior%20Management) Senior management highlighted solid Q2 performance, exceeding initial expectations for Adjusted EBITDA and consolidated revenue. Strategic progress includes advancing the ad tech platform for broadcast radio and ongoing modernization initiatives expected to yield $150 million in net savings in 2025 - Q2 adjusted EBITDA of **$156 million** was at the upper end of guidance and **4%** above prior year, with consolidated revenue up **0.5%** above prior year[5](index=5&type=chunk) - Progress is being made on the ad tech platform to enable broadcast radio inventory to be bought and sold like digital advertising, with Lisa Coffey joining as Chief Business Officer to drive these efforts[5](index=5&type=chunk) - Modernization initiatives are on track to generate net savings of **$150 million** in 2025 compared to 2024[5](index=5&type=chunk) [Consolidated Results of Operations](index=3&type=section&id=Consolidated%20Results%20of%20Operations) [Q2 2025 Consolidated Financial Performance](index=3&type=section&id=Second%20Quarter%202025%20Consolidated%20Results) Consolidated revenue increased slightly by 0.5% in Q2 2025, driven by a 13.4% increase in Digital Audio revenue, which offset a 5.4% decrease in Multiplatform Group revenue and a 3.3% decrease in Audio & Media Services revenue. GAAP Operating income significantly improved from a substantial loss in Q2 2024 to a profit in Q2 2025, while Adjusted EBITDA saw a modest increase | Metric | Q2 2025 (in millions) | Q2 2024 (in millions) | Change | | :-------------------------------- | :-------------------- | :-------------------- | :----- | | Consolidated Revenue | $933.7M | $929.1M | 0.5% | | Digital Audio Revenue | $323.9M | $285.6M | 13.4% | | Multiplatform Group Revenue | $544.6M | $575.9M | (5.4%) | | Audio & Media Services Revenue | $67.7M | $70.1M | (3.3%) | | GAAP Operating Income (Loss) | $35.4M | ($909.7M) | N/A | | Adjusted EBITDA | $156.1M | $150.2M | 3.9% | | Cash provided by operating activities | $6.8M | $26.7M | (74.5%) | | Free Cash Flow | ($13.2M) | $5.6M | N/A | [Operating Expenses Analysis](index=3&type=section&id=Operating%20Expenses%20Analysis) Consolidated direct operating expenses increased by 2.4% in Q2 2025, primarily due to higher variable content costs associated with increased digital revenues, including podcast profit share and third-party digital costs. This increase was partially mitigated by reduced employee compensation costs from 2024 modernization initiatives - Consolidated direct operating expenses increased **$9.1 million**, or **2.4%**, driven by higher variable content costs (podcast profit share, third-party digital costs) related to increased digital revenues[7](index=7&type=chunk) - The increase was partially offset by a decrease in employee compensation cost due to modernization initiatives taken in 2024[7](index=7&type=chunk) [SG&A Expenses Analysis](index=3&type=section&id=SG%26A%20Expenses%20Analysis) Consolidated Selling, General & Administrative (SG&A) expenses decreased by 4.3% in Q2 2025, mainly due to cost savings initiatives, including lower employee compensation from modernization efforts and reduced sales commissions. This was partially offset by increases in non-cash trade and barter expense and employee benefit expense from the reestablishment of the 401(k) match program - Consolidated SG&A expenses decreased **$18.5 million**, or **4.3%**, primarily due to decreased costs from cost savings initiatives, including lower employee compensation and sales commissions[8](index=8&type=chunk) - The decrease was partially offset by increases in non-cash trade and barter expense and employee benefit expense related to the reestablishment of the 401(k) match program in Q1 2025[8](index=8&type=chunk) [Business Segment Performance](index=4&type=section&id=Business%20Segments%3A%20Results%20of%20Operations) [Multiplatform Group Results](index=4&type=section&id=Second%20Quarter%202025%20Multiplatform%20Group%20Results) The Multiplatform Group's revenue declined by 5.4% year-over-year in Q2 2025, primarily due to a decrease in broadcast advertising. Despite a 5.0% reduction in operating expenses, Segment Adjusted EBITDA decreased by 7.6%, and the Adjusted EBITDA margin slightly narrowed | Metric | Q2 2025 (in thousands) | Q2 2024 (in thousands) | Change (%) | | :------------------------ | :--------------------- | :--------------------- | :--------- | | Revenue | $544,598 | $575,907 | (5.4%) | | Operating expenses | $448,234 | $471,644 | (5.0%) | | Segment Adjusted EBITDA | $96,364 | $104,263 | (7.6%) | | Segment Adjusted EBITDA margin | 17.7% | 18.1% | (0.4 pp) | - Revenue decreased due to a **$29.7 million** (**7.0%**) decline in broadcast revenue, driven by lower spot revenue, and a **$2.6 million** (**6.7%**) decrease in Sponsorship and Events revenue[11](index=11&type=chunk) - Operating expenses decreased primarily due to lower employee compensation from modernization initiatives and reduced sales commissions[12](index=12&type=chunk) [Digital Audio Group Results](index=4&type=section&id=Second%20Quarter%202025%20Digital%20Audio%20Group%20Results) The Digital Audio Group achieved robust growth in Q2 2025, with revenue increasing by 13.4% year-over-year, largely fueled by a 28.5% surge in Podcast revenue. This strong top-line performance, despite an 11.6% rise in operating expenses, led to a 17.1% increase in Segment Adjusted EBITDA and an improved Adjusted EBITDA margin | Metric | Q2 2025 (in thousands) | Q2 2024 (in thousands) | Change (%) | | :------------------------ | :--------------------- | :--------------------- | :--------- | | Revenue | $323,856 | $285,614 | 13.4% | | Operating expenses | $216,246 | $193,744 | 11.6% | | Segment Adjusted EBITDA | $107,610 | $91,870 | 17.1% | | Segment Adjusted EBITDA margin | 33.2% | 32.2% | 1.0 pp | - Podcast revenue increased **$29.8 million** (**28.5%**) to **$134.3 million** due to continued advertiser demand, and Digital, excluding Podcast revenue, increased **$8.5 million** (**4.7%**) to **$189.6 million**[14](index=14&type=chunk) - Operating expenses increased primarily due to higher variable content costs, including podcast profit share and third-party digital costs, related to revenue growth[15](index=15&type=chunk) [Audio & Media Services Group Results](index=5&type=section&id=Second%20Quarter%202025%20Audio%20%26%20Media%20Services%20Group%20Results) The Audio & Media Services Group experienced a 3.3% year-over-year revenue decrease in Q2 2025, mainly due to lower political revenues (2024 being a presidential election year) and a decline in broadcast advertising. Despite a decrease in operating expenses, Segment Adjusted EBITDA saw a marginal decline, though the Adjusted EBITDA margin improved | Metric | Q2 2025 (in thousands) | Q2 2024 (in thousands) | Change (%) | | :------------------------ | :--------------------- | :--------------------- | :--------- | | Revenue | $67,736 | $70,082 | (3.3%) | | Operating expenses | $44,015 | $46,233 | (4.8%) | | Segment Adjusted EBITDA | $23,721 | $23,849 | (0.5%) | | Segment Adjusted EBITDA margin | 35.0% | 34.0% | 1.0 pp | - Revenue decreased primarily due to lower political revenues (2024 was a presidential election year) and a decrease in broadcast advertising, partially offset by increased digital advertising demand[17](index=17&type=chunk) - Operating expenses decreased due to reduced employee compensation costs from modernization initiatives[18](index=18&type=chunk) [Liquidity and Financial Position](index=6&type=section&id=Liquidity%20and%20Financial%20Position) [Liquidity and Financial Position Overview](index=6&type=section&id=Liquidity%20and%20Financial%20Position%20Overview) As of June 30, 2025, iHeartMedia maintained a cash balance of $235.9 million and total available liquidity of $526.7 million. The company reported cash used for operating activities of $54.1 million and capital expenditures of $39.7 million for the six months ended June 30, 2025, with total debt at $5,137.5 million and Net Debt at $4,635.3 million | Metric | As of June 30, 2025 (in millions) | | :-------------------------------- | :-------------------------------- | | Cash balance | $235.9 | | Total available liquidity | $526.7 | | Cash used for operating activities (6 months) | $54.1 | | Cash used for investing activities (6 months) | $40.6 | | Cash provided by financing activities (6 months) | $70.7 | | Capital expenditures (6 months) | $39.7 | | Total debt | $5,137.5 | | Net Debt | $4,635.3 | [Revenue Streams Overview](index=7&type=section&id=Revenue%20Streams) [Q2 2025 Revenue by Stream](index=7&type=section&id=Q2%202025%20Revenue%20by%20Stream) A detailed breakdown of revenue streams for Q2 2025 shows that Digital Audio Group, particularly Podcast revenue, was the primary growth driver, while Broadcast Radio and Sponsorship and Events within the Multiplatform Group experienced declines. Overall consolidated revenue increased slightly | Revenue Stream | Q2 2025 (in thousands) | Q2 2024 (in thousands) | Change (%) | | :-------------------------- | :--------------------- | :--------------------- | :--------- | | **Multiplatform Group** | | | | | Broadcast Radio | $395,789 | $425,490 | (7.0%) | | Networks | $107,813 | $106,591 | 1.1% | | Sponsorship and Events | $36,485 | $39,121 | (6.7%) | | Other | $4,511 | $4,705 | (4.1%) | | *Total Multiplatform Group* | *$544,598* | *$575,907* | *(5.4%)* | | **Digital Audio Group** | | | | | Digital ex. Podcast | $189,560 | $181,093 | 4.7% | | Podcast | $134,296 | $104,521 | 28.5% | | *Total Digital Audio Group* | *$323,856* | *$285,614* | *13.4%* | | **Audio & Media Services Group** | *$67,736* | *$70,082* | *(3.3%)* | | **Revenue, total** | *$933,653* | *$929,092* | *0.5%* | [Company Information](index=8&type=section&id=About%20iHeartMedia%2C%20Inc.) [About iHeartMedia, Inc.](index=8&type=section&id=About%20iHeartMedia%2C%20Inc.%20Description) iHeartMedia is the leading audio company in the United States, reaching nine out of ten Americans monthly through its three business groups: Multiplatform, Digital Audio, and Audio & Media Services. These groups encompass broadcast radio, national sales, live events, podcasting, digital services, ad tech, and media representation - iHeartMedia is the **number one** audio company in the United States, reaching **nine out of 10 Americans** every month[28](index=28&type=chunk) - The Multiplatform Group includes **over 860** live broadcast stations, National Sales, live and virtual events, Premiere Networks, and SmartAudio for analytics and targeting[29](index=29&type=chunk) - The Digital Audio Group comprises the **number one** podcast publisher, the iHeartRadio digital service, digital sites, newsletters, digital advertising technology companies, and a strong social media presence[30](index=30&type=chunk) - The Audio & Media Services segment includes Katz Media Group (**largest** media representation company) and RCS (**leading** provider of broadcast and webcast software)[31](index=31&type=chunk) [Conference Call Information](index=8&type=section&id=Conference%20Call) iHeartMedia, Inc. will host a conference call on August 11, 2025, at 4:30 p.m. Eastern Time to discuss Q2 2025 results and business outlook, with replay options available for thirty days - Conference call to discuss results and business outlook on August 11, 2025, at 4:30 p.m. Eastern Time[27](index=27&type=chunk) - Dial-in numbers: (888) 596-4144 (U.S.) and +1 (646) 968-2525 (International), passcode 8885116[27](index=27&type=chunk) - A live audio webcast will be available on investors.iheartmedia.com, with a replay available for thirty days[27](index=27&type=chunk) [Forward-Looking Statements](index=9&type=section&id=Forward-Looking%20Statements) [Forward-Looking Statements Disclaimer](index=9&type=section&id=Forward-Looking%20Statements%20Disclaimer) This section contains forward-looking statements regarding iHeartMedia's future performance, strategic initiatives, and financial outlook, which are subject to known and unknown risks and uncertainties that could cause actual results to differ materially. Investors are cautioned not to place undue reliance on these statements - Statements regarding guidance, beliefs, expectations, estimates, and forecasts are forward-looking and involve known and unknown risks and uncertainties[33](index=33&type=chunk) - Examples of forward-looking statements include those related to realizing debt exchange benefits, positioning in uncertain economic environments, anticipated growth, cost savings, new technologies, advertising demand, and future liquidity[33](index=33&type=chunk) - Key risks include global economic uncertainty, dependence on advertising revenues, competition, operating cost fluctuations, technological changes, and risks related to indebtedness and regulatory requirements[33](index=33&type=chunk) [Appendix: Financial Tables & Non-GAAP Reconciliations](index=10&type=section&id=APPENDIX) [Consolidated Operating Performance Comparison](index=10&type=section&id=TABLE%201%20-%20Comparison%20of%20operating%20performance) This table provides a comparison of consolidated operating performance for the three and six months ended June 30, 2025 and 2024, detailing revenue, various operating expenses, and Adjusted EBITDA | (In thousands) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :------------------------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Revenue | $933,653 | $929,092 | $1,740,754 | $1,728,130 | | Direct operating expenses | $391,194 | $382,049 | $747,520 | $723,409 | | Selling, general and administrative expenses | $413,082 | $431,614 | $793,876 | $816,758 | | Depreciation and amortization | $90,369 | $104,356 | $182,270 | $209,518 | | Impairment charges | $2,552 | $920,224 | $5,407 | $921,732 | | Operating income (loss) | $35,370 | ($909,667) | $9,936 | ($944,375) | | Adjusted EBITDA | $156,127 | $150,207 | $260,715 | $254,824 | [Consolidated Statements of Operations](index=11&type=section&id=TABLE%202%20-%20Statements%20of%20Operations) This table presents the full consolidated statements of operations, including revenue, operating expenses, interest expense, net loss, and net loss attributable to the company for the three and six months ended June 30, 2025 and 2024 | (In thousands) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :------------------------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Revenue | $933,653 | $929,092 | $1,740,754 | $1,728,130 | | Operating income (loss) | $35,370 | ($909,667) | $9,936 | ($944,375) | | Interest expense, net | $100,894 | $95,577 | $201,280 | $191,092 | | Loss before income taxes | ($65,735) | ($1,005,948) | ($211,259) | ($1,044,718) | | Income tax benefit (expense) | ($18,253) | $23,959 | ($153,612) | $44,621 | | Net loss | ($83,988) | ($981,989) | ($364,871) | ($1,000,097) | | Net loss attributable to the Company | ($83,480) | ($981,658) | ($364,704) | ($1,000,166) | [Selected Balance Sheet Information](index=11&type=section&id=TABLE%203%20-%20Selected%20Balance%20Sheet%20Information) This table provides selected balance sheet information, highlighting key assets, liabilities, and stockholders' deficit as of June 30, 2025, compared to December 31, 2024 | (In millions) | June 30, 2025 | December 31, 2024 | | :---------------------------------------- | :------------ | :---------------- | | Cash | $235.9 | $259.6 | | Total Current Assets | $1,348.2 | $1,361.8 | | Net Property, Plant and Equipment | $451.3 | $489.8 | | Total Assets | $5,379.3 | $5,571.7 | | Current Liabilities (excl. current portion of long-term debt) | $825.4 | $847.8 | | Long-term Debt (incl. current portion) | $5,137.5 | $5,071.5 | | Stockholders' Deficit | ($1,726.2) | ($1,371.8) | [Supplemental Disclosure Regarding Non-GAAP Financial Information](index=12&type=section&id=Supplemental%20Disclosure%20Regarding%20Non-GAAP%20Financial%20Information) This section defines iHeartMedia's non-GAAP financial measures, including Adjusted EBITDA, Free Cash Flow, revenue excluding political advertising, and Net Debt. It explains how these measures are calculated, their utility for management and investors in evaluating operating performance and liquidity, and clarifies their limitations as non-GAAP metrics - **Adjusted EBITDA** is defined as consolidated Operating income (loss) adjusted for restructuring, share-based compensation, depreciation, amortization, impairment, and other operating expenses, used to evaluate operating performance and for management compensation[39](index=39&type=chunk)[40](index=40&type=chunk) - **Free Cash Flow** is defined as Cash provided by (used for) operating activities less capital expenditures, used to evaluate liquidity and ability to generate cash flow after necessary ongoing operations[43](index=43&type=chunk) - **Net Debt** is defined as Total Debt less Cash and cash equivalents and Debt Premium, used to evaluate the Company's ability to service long-term debt obligations[46](index=46&type=chunk) [Reconciliation of Operating Income (Loss) to Adjusted EBITDA](index=14&type=section&id=Reconciliation%20of%20Operating%20income%20%28loss%29%20to%20Adjusted%20EBITDA) This table provides a reconciliation of GAAP Operating income (loss) to Adjusted EBITDA, detailing the adjustments made for non-cash and non-recurring items for the three and six months ended June 30, 2025 and 2024 | (In thousands) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :-------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Operating income (loss) | $35,370 | ($909,667) | $9,936 | ($944,375) | | Depreciation and amortization | $90,369 | $104,356 | $182,270 | $209,518 | | Impairment charges | $2,552 | $920,224 | $5,407 | $921,732 | | Other operating expense | $1,086 | $516 | $1,745 | $1,088 | | Restructuring expenses | $19,490 | $27,558 | $45,068 | $51,161 | | Share-based compensation expense | $7,260 | $7,220 | $16,289 | $15,700 | | Adjusted EBITDA | $156,127 | $150,207 | $260,715 | $254,824 | [Reconciliation of Net Loss to EBITDA and Adjusted EBITDA](index=15&type=section&id=Reconciliation%20of%20Net%20loss%20to%20EBITDA%20and%20Adjusted%20EBITDA) This table reconciles GAAP Net loss to EBITDA and then to Adjusted EBITDA, providing a comprehensive view of adjustments for non-operating and non-cash items for the three and six months ended June 30, 2025 and 2024 | (In thousands) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :-------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Net loss | ($83,988) | ($981,989) | ($364,871) | ($1,000,097) | | Income tax expense (benefit) | $18,253 | ($23,959) | $153,612 | ($44,621) | | Interest expense, net | $100,894 | $95,577 | $201,280 | $191,092 | | Depreciation and amortization | $90,369 | $104,356 | $182,270 | $209,518 | | EBITDA | $125,528 | ($806,015) | $172,291 | ($644,108) | | (Gain) loss on investments, net | $901 | $412 | $19,495 | ($91,582) | | Loss on extinguishment of debt | $263 | — | $1,460 | — | | Impairment charges | $2,552 | $920,224 | $5,407 | $921,732 | | Restructuring expenses | $19,490 | $27,558 | $45,068 | $51,161 | | Share-based compensation expense | $7,260 | $7,220 | $16,289 | $15,700 | | Adjusted EBITDA | $156,127 | $150,207 | $260,715 | $254,824 | [Reconciliation of Cash Provided by (Used for) Operating Activities to Free Cash Flow](index=15&type=section&id=Reconciliation%20of%20Cash%20provided%20by%20%28used%20for%29%20operating%20activities%20to%20Free%20Cash%20Flow) This table reconciles cash provided by (used for) operating activities to Free Cash Flow by deducting capital expenditures for the three and six months ended June 30, 2025 and 2024 | (In thousands) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :------------------------------------------ | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Cash provided by (used for) operating activities | $6,821 | $26,729 | ($54,123) | ($32,548) | | Purchases of property, plant and equipment | ($19,997) | ($21,172) | ($39,727) | ($42,754) | | Free cash flow | ($13,176) | $5,557 | ($93,850) | ($75,302) | [Reconciliation of Revenue to Revenue Excluding Political Advertising](index=16&type=section&id=Reconciliation%20of%20Revenue%20to%20Revenue%20excluding%20Political%20Advertising) This table provides a reconciliation of total revenue to revenue excluding political advertising for consolidated results and each business segment, illustrating the impact of political revenue on reported figures for the three and six months ended June 30, 2025 and 2024 | (In thousands) | Q2 2025 Revenue (in thousands) | Q2 2024 Revenue (in thousands) | Q2 2025 Excl. Political (in thousands) | Q2 2024 Excl. Political (in thousands) | | :------------------------------------------ | :----------------------------- | :----------------------------- | :------------------------------------- | :------------------------------------- | | Consolidated revenue | $933,653 | $929,092 | $927,500 | $914,185 | | Multiplatform Group revenue | $544,598 | $575,907 | $540,606 | $567,882 | | Digital Audio Group revenue | $323,856 | $285,614 | $322,543 | $284,404 | | Audio & Media Group Services revenue | $67,736 | $70,082 | $66,888 | $64,410 | [Reconciliation of Total Debt to Net Debt](index=16&type=section&id=Reconciliation%20of%20Total%20Debt%20to%20Net%20Debt) This table reconciles the company's total debt to Net Debt as of June 30, 2025, by subtracting debt premium and cash and cash equivalents | (In thousands) | June 30, 2025 | | :-------------------------- | :------------ | | Current portion of long-term debt | $73,726 | | Long-term debt | $5,063,792 | | Total debt | $5,137,518 | | Less: Debt premium | $266,302 | | Less: Cash and cash equivalents | $235,932 | | Net debt | $4,635,284 | [Detailed Segment Results](index=18&type=section&id=Segment%20Results) These tables present detailed segment results for the Multiplatform, Digital Audio, and Audio & Media Services Groups, including revenue, operating expenses, Segment Adjusted EBITDA, and Adjusted EBITDA margin for the three and six months ended June 30, 2025 and 2024, along with consolidated operating income/loss | (In thousands) | Multiplatform Group | Digital Audio Group | Audio & Media Services Group | Consolidated | | :-------------------------- | :------------------ | :------------------ | :--------------------------- | :----------- | | **Three Months Ended June 30, 2025** | | | | | | Revenue | $544,598 | $323,856 | $67,736 | $933,653 | | Operating expenses | $448,234 | $216,246 | $44,015 | $777,526 | | Segment Adjusted EBITDA | $96,364 | $107,610 | $23,721 | $156,127 | | Adjusted EBITDA margin | 17.7% | 33.2% | 35.0% | 16.7% | | Operating income | | | | $35,370 | | **Three Months Ended June 30, 2024** | | | | | | Revenue | $575,907 | $285,614 | $70,082 | $929,092 | | Operating expenses | $471,644 | $193,744 | $46,233 | $778,885 | | Segment Adjusted EBITDA | $104,263 | $91,870 | $23,849 | $150,207 | | Adjusted EBITDA margin | 18.1% | 32.2% | 34.0% | 16.2% | | (In thousands) | Multiplatform Group | Digital Audio Group | Audio & Media Services Group | Consolidated | | :-------------------------- | :------------------ | :------------------ | :--------------------------- | :----------- | | **Six Months Ended June 30, 2025** | | | | | | Revenue | $1,017,576 | $601,143 | $127,059 | $1,740,754 | | Operating expenses | $851,205 | $406,450 | $87,540 | $1,480,039 | | Segment Adjusted EBITDA | $166,371 | $194,693 | $39,519 | $260,715 | | Adjusted EBITDA margin | 16.3% | 32.4% | 31.1% | 15.0% | | Operating income | | | | $9,936 | | **Six Months Ended June 30, 2024** | | | | | | Revenue | $1,069,370 | $524,582 | $139,250 | $1,728,130 | | Operating expenses | $887,925 | $364,585 | $91,706 | $1,473,306 | | Segment Adjusted EBITDA | $181,445 | $159,997 | $47,544 | $254,824 | | Adjusted EBITDA margin | 17.0% | 30.5% | 34.1% | 14.7% | | Operating loss | | | | ($944,375) |

[Business Highlights and Program Updates](index=1&type=section&id=Business%20Highlights%20and%20Program%20Updates) Denali Therapeutics achieved significant regulatory milestones for its Transport Vehicle (TV) platform, advancing multiple clinical and preclinical programs [Overview](index=1&type=section&id=Overview) Denali Therapeutics made significant regulatory progress for its Transport Vehicle (TV) platform, including FDA priority review for tividenofusp alfa and an accelerated approval pathway for DNL126 - The CEO highlighted the potential of the company's **Transport Vehicle (TV) platform** to create a new class of therapeutics that can cross the blood-brain barrier, positioning Denali to deliver treatments for lysosomal, neurodegenerative, and other serious diseases[3](index=3&type=chunk) - The FDA accepted the Biologics License Application (BLA) for tividenofusp alfa for Hunter syndrome for **priority review**, with a PDUFA target action date of **January 5, 2026**[4](index=4&type=chunk)[6](index=6&type=chunk) - An **accelerated approval pathway** for DNL126 for Sanfilippo syndrome Type A was aligned with the FDA[5](index=5&type=chunk)[6](index=6&type=chunk) - The company is on track to submit regulatory applications in 2025 to begin clinical testing for **one to two additional TV-enabled programs**[6](index=6&type=chunk) - Preclinical research on the **ATV:Abeta program** for Alzheimer's disease was published in the journal ***Science***, demonstrating potential advantages in crossing the blood-brain barrier and reducing ARIA risk[6](index=6&type=chunk)[10](index=10&type=chunk) [Clinical Programs](index=1&type=section&id=Clinical%20Programs) Denali's clinical pipeline advanced significantly with tividenofusp alfa under FDA priority review and DNL126 on an accelerated approval pathway [Tividenofusp alfa (DNL310) for Hunter syndrome (MPS II)](index=1&type=section&id=Tividenofusp%20alfa%20(DNL310)%20for%20Hunter%20syndrome%20(MPS%20II)) The FDA accepted the Biologics License Application (BLA) for tividenofusp alfa for priority review, setting a PDUFA target action date of January 5, 2026 - The FDA accepted the BLA for tividenofusp alfa for **priority review** and assigned a PDUFA target action date of **January 5, 2026**[4](index=4&type=chunk) - The BLA seeks **accelerated approval** based on data from the Phase 1/2 study[4](index=4&type=chunk) - The company is preparing for **commercial launch** and conducting the **Phase 2/3 COMPASS study** to support global regulatory submissions[4](index=4&type=chunk) [DNL126 (ETV:SGSH) for Sanfilippo syndrome type A (MPS IIIA)](index=1&type=section&id=DNL126%20(ETV%3ASGSH)%20for%20Sanfilippo%20syndrome%20type%20A%20(MPS%20IIIA)) Denali has aligned with the FDA that cerebrospinal fluid heparan sulfate (CSF HS) can be used as a surrogate endpoint to support an accelerated approval for DNL126 - Reached alignment with the FDA that **CSF heparan sulfate (CSF HS)** may be used as a surrogate endpoint to support **accelerated approval**[5](index=5&type=chunk) - Ongoing open-label Phase 1/2 study data demonstrated a **significant reduction in CSF HS** from baseline, supporting continued development[5](index=5&type=chunk) - Enrollment in the Phase 1/2 study is **nearly complete**, and planning for a confirmatory **global Phase 3 study** is underway[5](index=5&type=chunk) [TAK-594/DNL593 (PTV:PGRN) for GRN-related frontotemporal dementia](index=2&type=section&id=TAK-594%2FDNL593%20(PTV%3APGRN)%20for%20GRN-related%20frontotemporal%20dementia) The collaboration with Takeda to develop DNL593, a therapeutic designed to cross the blood-brain barrier for the treatment of FTD-GRN, is progressing with a Phase 1/2 study currently ongoing - Denali and Takeda are collaborating on the development of **DNL593** for FTD-GRN, with a **Phase 1/2 study** currently ongoing[7](index=7&type=chunk) [BIIB122/DNL151 (small molecule LRRK2 inhibitor) for Parkinson's disease (PD)](index=2&type=section&id=BIIB122%2FDNL151%20(small%20molecule%20LRRK2%20inhibitor)%20for%20Parkinson's%20disease%20(PD)) In partnership with Biogen, the Phase 2b LUMA study of LRRK2 inhibitor BIIB122 has completed enrollment, with results expected in 2026 - The **Phase 2b LUMA study** of BIIB122, co-developed with Biogen, has completed enrollment with a readout expected in **2026**[8](index=8&type=chunk) - Denali is also conducting the **Phase 2a BEACON study**, which focuses on LRRK2-associated Parkinson's disease[8](index=8&type=chunk) [IND-Enabling Stage Programs](index=2&type=section&id=IND-Enabling%20Stage%20Programs) Denali plans to advance one to two new TV-enabled programs into clinical testing annually, with preclinical data for ATV:Abeta showing improved brain distribution and reduced ARIA risk - The company expects to submit regulatory applications to begin clinical testing of **one to two TV-enabled programs each year** for the next three years[9](index=9&type=chunk) - Advanced preclinical programs include candidates for **Pompe disease (DNL952)**, **Parkinson's/Gaucher disease (DNL111)**, **MPS I (DNL622)**, and **Alzheimer's disease (DNL921, DNL628)**[9](index=9&type=chunk) - Preclinical data published in ***Science*** for the **ATV:Abeta program** demonstrated **improved brain distribution** and **reduced ARIA risk** in a mouse model compared to conventional antibody treatment[10](index=10&type=chunk) [Second Quarter 2025 Financial Results](index=3&type=section&id=Second%20Quarter%202025%20Financial%20Results) Denali reported an increased net loss in Q2 2025 due to higher R&D and G&A expenses, while maintaining a strong cash position [Financial Performance Summary](index=3&type=section&id=Financial%20Performance%20Summary) For the second quarter of 2025, Denali reported a net loss of $124.1 million, an increase from $99.0 million in the same period of 2024 | Financial Metric | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | Net Loss | $124.1 million | $99.0 million | | Research & Development Expenses | $102.7 million | $91.4 million | | General & Administrative Expenses | $32.3 million | $25.2 million | | Cash, Cash Equivalents, & Marketable Securities | $977.4 million | N/A | - The **$11.3 million increase in R&D expenses** was primarily driven by increased spending on preclinical TV programs and costs associated with the commencement of operations at the Salt Lake City manufacturing facility[13](index=13&type=chunk) - The **$7.1 million increase in G&A expenses** was mainly due to activities related to preparations for a potential commercial launch of tividenofusp alfa[14](index=14&type=chunk) [Condensed Consolidated Statements of Operations](index=5&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) The statement of operations shows a net loss of $124.1 million for Q2 2025, compared to a net loss of $99.0 million for the same period in 2024 | (In thousands, except per share amounts) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | | :--- | :--- | :--- | | Research and development | $102,696 | $91,399 | | General and administrative | $32,267 | $25,194 | | **Total operating expenses** | **$134,963** | **$116,593** | | Loss from operations | ($134,963) | ($116,593) | | Interest and other income, net | $10,844 | $17,567 | | **Net loss** | **($124,119)** | **($99,026)** | | Net loss per share, basic and diluted | ($0.72) | ($0.59) | [Condensed Consolidated Balance Sheets](index=6&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) As of June 30, 2025, Denali had total assets of $1.17 billion, compared to $1.37 billion at the end of 2024 | (In thousands) | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Assets** | | | | Cash, cash equivalents, and marketable securities | $977,415 | $1,191,704 | | Total current assets | $934,706 | $864,436 | | **Total assets** | **$1,166,241** | **$1,374,180** | | **Liabilities and Stockholders' Equity** | | | | Total current liabilities | $91,057 | $102,208 | | **Total liabilities** | **$139,188** | **$144,496** | | **Total stockholders' equity** | **$1,027,053** | **$1,229,684** | [Corporate Information](index=2&type=section&id=Corporate%20Information) Denali Therapeutics will participate in upcoming investor conferences and continues its focus on developing therapies to cross the blood-brain barrier [Upcoming Investor Conferences](index=2&type=section&id=Upcoming%20Investor%20Conferences) Denali is scheduled to participate in seven investor conferences between September and November 2025, including events hosted by Cantor, Morgan Stanley, Baird, H.C. Wainwright, Deutsche Bank, Stifel, and Jefferies - The company will participate in **seven investor conferences** in the fall of 2025, providing opportunities to engage with the investment community[11](index=11&type=chunk) [About Denali Therapeutics](index=3&type=section&id=About%20Denali%20Therapeutics) Denali Therapeutics is a biopharmaceutical company based in South San Francisco, focused on developing a broad portfolio of product candidates engineered to cross the blood-brain barrier (BBB) for the treatment of neurodegenerative diseases and lysosomal storage diseases - Denali's core strategy involves developing therapies engineered to cross the **blood-brain barrier (BBB)** to treat neurodegenerative and lysosomal storage diseases[16](index=16&type=chunk) - The company's approach includes assessing genetically validated targets and using biomarkers to guide development[16](index=16&type=chunk)