Recursion Pharmaceuticals Reports Earnings and Announces Business Combination with Exscientia for Q
Intellectia.AI Updated: 1970-01-01
Recursion Pharmaceuticals Reports Earnings and Announces Business Combination with Exscientia for Q2 2024
Recursion Pharmaceuticals, Inc. reported its financial results for the second quarter of 2024 and announced a definitive agreement to combine with Exscientia as part of its strategy to transform the tech-enabled drug discovery landscape.
Key Financial Metrics
| Metrics | Q2 2024 Actual | Q2 2023 Actual | QoQ Change | YoY Change | Consensus Estimates |
|---|---|---|---|---|---|
| Total Revenue | $13.26M | $14.50M | -8.55% | -8.55% | $13.26M |
| Earnings Per Share (EPS) | $-0.40 | $-0.35 | 14.29% | 14.29% | $-0.40 |
Despite meeting revenue estimates, Recursion experienced an 8.55% year-over-year decline in total revenue. EPS widened from $-0.35 to $-0.40, reflecting increased investments and operational costs. This aligns with Wall Street consensus estimates.
Segment Revenue Performance
| Segment | Q2 2024 Revenue | Q2 2023 Revenue | Previous Guidance |
|---|---|---|---|
| Rare Diseases | $5.72M | $6.00M | $5.50M |
| Oncology | $4.38M | $4.80M | $4.25M |
| Partnerships & Collaborations | $3.16M | $3.70M | $3.50M |
Performance across the segments revealed mixed outcomes. Rare diseases and oncology segments slightly outperformed previous guidance, while partnerships and collaborations lagged. This overall revenue reduction points to varying performance in operational activities.
Operational Data
| Data Metric | Q2 2024 | Q2 2023 | QoQ Change | YoY Change |
|---|---|---|---|---|
| R&D Expenditure | $45.7M | $40.1M | 14.10% | 14.10% |
| General & Admin | $17.3M | $15.0M | 15.33% | 15.33% |
Increased research and development expenditure to $45.7M reflects the company's expansion efforts, particularly in the advanced stages of its pipeline.
CEO’s Commentary
Chris Gibson, Recursion’s Co-Founder and CEO, emphasized the strategic rationale behind the combination with Exscientia, citing complementary pipelines, platforms, and partnerships. He also highlighted the ten clinical readouts expected over the next 18 months and the expanded capabilities brought by Exscientia's precision chemistry and automated synthesis platforms.
Forward Guidance
Recursion and Exscientia forecast runway until 2027, leveraging their combined cash reserves of $850 million and annual cost-saving synergies expected to exceed $100 million.
Stock Price Movement
Following the earnings release and announcement of the business combination with Exscientia, Recursion’s stock saw an approximate 4.79% increase, reflecting strong investor sentiment towards the merger.
The report is now organized and ready for investors.
