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ALX ONCOLOGY HOLDINGS INC (ALXO)·Q4 2024 Earnings Summary

Executive Summary

  • Q4 2024 GAAP net loss narrowed to $(29.2)M and EPS to $(0.55), driven primarily by lower R&D expenses; non-GAAP net loss was $(23.2)M .
  • Cash, cash equivalents and investments ended at $131.3M; management extended cash runway guidance to Q4 2026 following strategic prioritization and a ~30% workforce reduction primarily in preclinical research .
  • Clinical momentum: updated ASPEN-06 Phase 2 data in HER2-positive gastric/GEJ showed cORR 48.9% and mDOR 15.7 months vs 24.5% and 9.1 months in control, HR for PFS 0.64; breast mBC data with zanidatamab showed cORR 55.6% and mPFS 7.4 months in centrally confirmed HER2-positive patients .
  • Near-term catalysts: ASPEN-03/04 head & neck Phase 2 toplines (Q2 2025) and FDA meeting in Q2 on ASPEN-06 registrational path; IND filing targeted for ALX2004 (EGFR ADC) in March 2025 .

What Went Well and What Went Wrong

What Went Well

  • Robust efficacy signals in HER2-positive settings: ASPEN-06 updated cORR 48.9% and mDOR 15.7 months vs 24.5% and 9.1 months in control; HR for PFS 0.64 .
  • Breast mBC data (evorpacept + zanidatamab) in centrally confirmed HER2-positive patients: cORR 55.6%, mPFS 7.4 months; manageable safety consistent with prior experience .
  • Cost discipline extended runway to Q4 2026; CEO emphasized focused development strategy aligning capital to derisked antibody combinations and new ALX2004 program .

What Went Wrong

  • R&D workforce reduction (~30%) signals constrained preclinical investment; founder/CSO transitioning to Senior Scientific Advisor in Q2 2025, which may create execution risk in research continuity .
  • No product revenue reported; consolidated statements present operating expenses and net loss only, underscoring continued pre-commercial status .
  • Consensus estimates unavailable via S&P Global for Q4 2024, limiting beat/miss assessment (see Estimates Context) [GetEstimates error].

Financial Results

Quarterly P&L (selected metrics)

Metric ($USD Thousands unless noted)Q2 2024Q3 2024Q4 2024
Research and Development34,653 26,471 23,532
General and Administrative6,872 6,096 7,081
Total Operating Expenses41,525 32,567 30,613
Interest Income2,563 2,303 1,878
Interest Expense429 446 427
Net Loss(39,399) (30,707) (29,163)
Net Loss per Share (basic & diluted, $)(0.76) (0.58) (0.55)
Weighted-average shares (basic & diluted)51,831,157 52,693,878 52,802,409

Balance Sheet Snapshot

Metric ($USD Thousands)Jun 30, 2024Sep 30, 2024Dec 31, 2024
Cash, Cash Equivalents & Investments186,198 162,610 131,281
Total Assets214,618 185,715 147,775
Total Liabilities55,301 48,908 34,157
Accumulated Deficit(561,252) (591,959) (621,122)
Stockholders’ Equity159,317 136,807 113,618

YoY – Q4 2024 vs Q4 2023

MetricQ4 2023Q4 2024Change
Research and Development ($000)41,784 23,532 (18,252)
General and Administrative ($000)6,239 7,081 +842
Net Loss ($000)(45,472) (29,163) +16,309
EPS (basic & diluted, $)(0.93) (0.55) +0.38
Cash, Cash Equivalents & Investments ($000)218,147 131,281 (86,866)

Non-GAAP Summary

Metric ($USD Thousands)Q2 2024Q3 2024Q4 2024
Stock-based Compensation7,252 6,952 5,858
Accretion of Term Loan Discount & Issuance Costs66 66 69
Non-GAAP Net Loss(32,081) (23,689) (23,236)

Notes: Q4 YoY improvement in net loss primarily reflects lower clinical and development costs (less manufacturing of clinical trial materials for evorpacept) and lower stock-based compensation; G&A rose on higher personnel-related costs .

KPIs and Operational Metrics

KPIQ2 2024Q3 2024Q4 2024
Cash Runway Guidance“well into Q1 2026” “well into Q1 2026” “into Q4 2026”
Workforce Reduction––~30% primarily in preclinical research
ASPEN-06 Efficacy (HER2-confirmed subgroup)–cORR 54.8% (fresh biopsy sub-population) cORR 48.9%, mDOR 15.7 months; control ORR 24.5%, mDOR 9.1; PFS HR 0.64
Breast mBC (evorpacept + zanidatamab)––cORR 55.6% (central HER2+), mPFS 7.4 months; manageable safety

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Cash RunwayCompany-level“well into Q1 2026” (Q2/Q3 2024) “into Q4 2026” (Q4 2024) Raised/Extended
Operating StructureQ4 2024 onward–Strategic prioritization with ~30% workforce reduction (preclinical) Lowered OpEx
Regulatory Path – Gastric/GEJ (ASPEN-06)Q2 2025Initiation of Phase 3 mid-2025 contemplated FDA meeting in Q2 2025 to discuss registrational path; regulatory guidance in Q2 2025 Clarified next steps
Clinical Milestones – HNSCC (ASPEN-03/04)Q2 2025Topline 1H 2025 Topline Q2 2025 Timed

Earnings Call Themes & Trends

TopicPrevious Mentions (Q2 & Q3 2024)Current Period (Q4 2024 / Mar 2025 R&D Day)Trend
R&D ExecutionQ2/Q3: Multiple Phase 1/2 readouts; ASPEN-06 topline improved ORR and DOR; ASCO presentations Updated ASPEN-06 efficacy; breast mBC data; expanding antibody combos into breast/CRC Strengthening efficacy narrative in HER2+ indications
Regulatory/Registrational PathQ2: Phase 3 initiation for gastric mid-2025 contemplated FDA meeting in Q2 2025 on ASPEN-06; guidance in Q2 2025 More concrete regulatory engagement
Cost Discipline/Cash RunwayQ2/Q3: runway well into Q1 2026 Runway extended to Q4 2026; ~30% workforce reduction Improved liquidity, leaner org
PD-1 Combinations (HNSCC)Q2/Q3: ASPEN-03/04 toplines 1H 2025 Primary endpoint emphasis shifted to ORR; toplines Q2 2025 Endpoint refocus to support potential AA
Pipeline Expansion (ALX2004)–Planned IND submission Mar 2025; differentiated EGFR ADC design New platform asset entering clinic
Leadership ChangesQ3: CMO appointed; board additions CFO appointed; CBO appointed; CSO transitioning to Senior Scientific Advisor Strengthening management bench, transition in research leadership

Management Commentary

  • “With multiple important clinical trial readouts… we have positioned ALX Oncology for near- and long-term success… expected to extend our cash runway into the fourth quarter of 2026” — CEO Jason Lettmann .
  • R&D Day framing: “Bottom line, we've demonstrated that combining evo with anticancer antibodies is active, and we're now advancing several trials to take this program towards approvals.” — CEO Jason Lettmann .
  • Scientific rationale: evorpacept designed for combination with potent Fc antibodies to block CD47 while enabling phagocytosis without cytopenias; >700 patients treated without blood cytopenias typical of active-Fc CD47 blockers — CSO Jaume Pons .

Q&A Highlights

  • Endpoint strategy for HNSCC: Management refocused primary endpoint to ORR to align with FDA’s accelerated approval expectations; internal Phase Ib signals showed ORR benefit vs KEYNOTE benchmark (approx. 40% vs 20%) supporting confidence .
  • ORR bar in HNSCC: Targeting ~10 percentage point improvement over ~20% KEYNOTE-048 ORR as clinically meaningful (i.e., ~50% nominal gain) .
  • Gastric registrational path: FDA meeting in Q2 2025 to discuss potential accelerated approval; HER2 biomarker strategy supported by fresh biopsy and ctDNA positivity in ~75–80% of patients .
  • Breast Phase 2 design: Intend to use fresh biopsies and central HER2 confirmation; exploratory ctDNA to complement selection .
  • CRC strategy: Single-arm second-line, cetuximab-naive RAS wildtype left-sided patients; historical response rates ~30–35% for FOLFIRI + cetuximab, leaving room for additive benefit with evorpacept .

Estimates Context

  • Wall Street consensus estimates via S&P Global for Q4 2024 (EPS and revenue) were unavailable at time of analysis due to data access constraints. As a result, beat/miss versus consensus cannot be determined for this quarter. Values would typically be retrieved from S&P Global.

Key Takeaways for Investors

  • Cost discipline and prioritization extended runway to Q4 2026, reducing financing overhang; near-term catalysts (ASPEN-03/04 toplines, FDA meeting on ASPEN-06) can re-rate sentiment .
  • Evorpacept’s biomarker-driven efficacy in HER2-positive tumors (gastric and breast) is a differentiator; positive randomized data in ASPEN-06 strengthens registrational viability .
  • Strategic pivot to derisked antibody combinations (breast/CRC) is aligned with clinical signals; fresh biopsy/ctDNA HER2 confirmation enhances patient selection .
  • Organizational changes (30% RIF; CSO transition) concentrate resources on late-stage and near-clinic programs, but warrant monitoring for execution continuity .
  • ALX2004 (EGFR ADC) adds an orthogonal growth vector; IND planned March 2025 with design aimed to mitigate historical EGFR ADC safety issues .
  • Pre-revenue profile persists; value inflection hinges on regulatory feedback in gastric and HNSCC readouts; absence of consensus estimates limits quarter-specific trading signals but amplifies focus on clinical/regulatory news flow .

Citations: Press release and 8-K Q4 2024 ; 8-K 2.02 Q4 2024 exhibit ; Q3 2024 press release ; Q2 2024 8-K and exhibit ; R&D Day transcript (Mar 5, 2025) .