RXRX Q2 Loss Wider Than Expected, Revenues Rise Y/Y, Stock Down

Recursion Pharmaceuticals RXRX reported a loss of 41 cents per share in the second quarter of 2025, wider than the Zacks Consensus Estimate of a loss of 35 cents. The company had incurred a loss of 40 cents per share in the year-ago quarter.

In the absence of an approved product, Recursion Pharmaceuticals only recognizes collaboration and grant revenues from its partners. Total revenues in the reported quarter amounted to $19.2 million, up 33% year over year, primarily driven by the recognition of a $7 million milestone payment from Sanofi for an immunology program. RXRX also recognizes periodic revenues from its ongoing collaboration agreements with Roche, Bayer and Merck KGaA, Darmstadt, Germany. The reported figure beat the Zacks Consensus Estimate of $14 million.

Shares of Recursion Pharmaceuticals lost 4.7% on Tuesday, likely because the investors were disappointed by the mixed nature of the second-quarter results.

RXRX’s Q2 Results in Detail

In the second quarter of 2025, Research and development (R&D) expenses soared 74% to $128.6 million compared with the $73.9 million reported in the year-ago period. The massive uptick in R&D expenses can be attributed to Recursion Pharmaceuticals’ agreement with Tempus for upgrading its therapeutic development platform, as well as its business combination with Exscientia in November 2024. 

General and administrative (G&A) expenses were $46.7 million in the reported quarter, up 47% year over year, due to the inclusion of G&A expenses from the business combination with Exscientia. Additionally, Recursion Pharmaceuticals’ cost of revenues in the reported quarter increased significantly to $20.2 million.

The company had cash, cash equivalents and restricted cash worth $533.8 million as of June 30, 2025, compared to $509 million as of March 31, 2025. Recursion Pharmaceuticals expects its existing cash, cash equivalents and restricted cash to fuel operations into the fourth quarter of 2027, based on its current business plan.

The stock has plunged 18.2% year to date against the industry’s 0.2% growth.

RXRX’s Key Pipeline Updates

Recursion Pharmaceuticals faced a significant setback in May 2025 after announcing the discontinuation of three key drug candidates — REC-994, REC-2282, and REC-3964 — as part of its broader strategic pipeline reprioritization. These candidates were being developed for cerebral cavernous malformation, neurofibromatosis type II and Clostridioides difficile infection, respectively.

Following the terminations, Recursion Pharmaceuticals shifted focus to more promising candidates, notably REC-4881, which is being evaluated in a phase Ib/II TUPELO study for familial adenomatous polyposis. In May 2025, the company reported preliminary data from this study, with additional data expected in the second half of 2025.

In 2024, Recursion Pharmaceuticals initiated its phase I/II DAHLIA study of REC-1245, a new chemical entity for the treatment of biomarker-enriched solid tumors and lymphoma. Data readout from the phase I portion of the DAHLIA study is expected in the first half of 2026. Recursion Pharmaceuticals is also developing a few other candidates, like REC-617 (advanced solid tumors) and REC-3565 (B-cell malignancies), in separate early-stage studies, anticipating data readouts in the second half of 2025 and 2026, respectively.

In July 2025, Recursion Pharmaceuticals acquired Rallybio’s full stake in their joint venture for developing REV102 (now REC102) and an associated backup molecule for the treatment of hypophosphatasia. REC102, a potent and selective ENPP1 inhibitor with strong preclinical safety data, is expected to enter phase I studies by late 2026. Its oral formulation offers a major advantage over current enzyme replacement therapies, potentially improving patient adherence and reducing treatment-associated risks.

Recursion Pharmaceuticals, Inc. Price, Consensus and EPS Surprise

Recursion Pharmaceuticals, Inc. price-consensus-eps-surprise-chart | Recursion Pharmaceuticals, Inc. Quote

RXRX’s Zacks Rank & Stocks to Consider

Recursion Pharmaceuticals currently carries a Zacks Rank #3 (Hold).

Some better-ranked stocks in the biotech sector are Arvinas ARVN, CorMedix CRMD and Immunocore IMCR, each sporting a Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

In the past 60 days, estimates for Arvinas’ 2025 loss per share have narrowed from $1.51 to $1.50. Loss per share estimates for 2026 have narrowed from $3.08 to $2.98 during the same period. ARVN stock has plunged 60.3% year to date.

Arvinas’ earnings beat estimates in each of the trailing four quarters, delivering an average surprise of 82.09%.

In the past 60 days, estimates for CorMedix’s earnings per share have increased from 93 cents to 97 cents for 2025. During the same time, earnings per share estimates for 2026 have increased from $1.64 to $1.65. Year to date, shares of CRMD have rallied 48.8%.

CorMedix’s earnings beat estimates in each of the trailing four quarters, delivering an average surprise of 25.82%.

In the past 60 days, estimates for Immunocore’s 2025 loss per share have narrowed from 86 cents to 68 cents. Loss per share estimates for 2026 have narrowed from $1.34 to $1.10 during the same period. IMCR stock has increased 10.2% year to date.

Immunocore’s earnings beat estimates in three of the trailing four quarters while missing the same on the remaining occasion, the average surprise being 76.18%.

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This article originally published on Zacks Investment Research (zacks.com).

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