Recursion Pharmaceuticals Inc - Class A
Q2 2025 Earnings
Market Reaction
S&P 500 over the same 30 days: +3.07%.
Did RXRX Beat Earnings? Q2 2025 Results
Recursion Pharmaceuticals delivered a mixed second quarter, posting revenue that cleared expectations by a wide margin while its bottom line fell short of analyst forecasts. The Salt Lake City-based AI drug discovery company reported Q2 2025 revenue of $19.22 million, a 33.5% jump from the year-ago period and 24.96% ahead of the $15.38 million consensus, driven in part by a $7.00 million Sanofi milestone payment representing the fourth partnered program to reach a discovery milestone in 18 months. Earnings per share, however, came in at -$0.41, missing the -$0.35 consensus estimate by 16.05%, as the net loss widened to $171.90 million largely on costs tied to the November 2024 Exscientia business combination and a $22.70 million non-cash Tempus data collaboration charge. Despite the earnings miss, shares moved higher in pre-market trading, with investors appearing to focus on the company's improving cost trajectory; management guided for 2025 cash burn below $450.00 million and projected a roughly 35% reduction in pro forma operating expenses from 2024 to 2026, with cash runway extending into Q4 2027.
- Revenue increase driven by collaboration agreement milestones including $7 million Sanofi milestone payment
- $28.6 million R&D tax credit received in first half of 2025
- Increased R&D and G&A expenses primarily from Exscientia business combination completed November 2024
- $22.7 million non-cash expense recognized for Tempus patient-centric multimodal oncology data
“The power of our platform not only allows us to discover and develop potential new medicines, but also gives us insights on patient populations to target that would be challenging using traditional methods. In discovery, we're deploying advanced models like Boltz-2 to rapidly design ligands for high-value targets. State of the art platform capabilities helped us drive our fourth partnered discovery milestone with Sanofi this quarter, reflecting tangible momentum across our joint pipeline. We are leveraging these and other improvements to the Recursion OS to not only accelerate and improve our funnel of new programs, but also execution of later stage programs in our pipeline like RBM39 and CDK7.”
Recursion Pharmaceuticals CEO, on the earnings call
Forward Guidance & Outlook
Recursion expects cash runway to extend into Q4 2027 based on current operating plans. The company guides for 2025 cash burn of less than $450 million and 2026 cash burn of less than $390 million (defined as operating cash flow less capital expenditures, excluding partnership and financing inflows, transaction expenses and severance). Pro forma operating expenses are expected to decline approximately 35% from 2024 to 2026. The company sees potential for over $100 million in partnership milestones by end of 2026. Restructuring costs of $9.3 million are expected to be fully incurred in 2025. Key pipeline catalysts include REC-4881 additional FAP data and REC-617 additional monotherapy data in 2H25, REC-7735 development candidate nomination in 2H25, REC-1245 early Phase 1 safety/PK data in 1H26, REC-3565 early Phase 1 data in 2H26, and REC-102 Phase 1 initiation in 2H26.
RXRX YoY Financials
Figures from SEC filings and company reports. Not investment advice.