Executive Summary

Q2 2025 reflected higher operating spend and a larger net loss: Operating expenses rose 25% year over year to $3.150M, driving net loss to $3.221M vs. $2.433M in Q2 2024 .
EPS missed Wall Street consensus: Actual diluted EPS was $(5.61) vs. consensus of $(4.19); revenue was $0, in-line with estimates of $0 .
Liquidity tightened despite capital raises: Cash ended the quarter at $2.066M; working capital swung to $(3.479)M from $0.785M at year-end 2024, highlighting near-term funding needs .
Strategic catalysts ahead: Initial Phase 2 data for ART27.13 (CAReS) targeted for Q3 2025 and advancement of ART26.12 to a MAD study in Q4 2025; UK MHRA provided positive advice on ART12.11 and potential ILAP pathway .

What Went Well and What Went Wrong

What Went Well

Progress across pipeline programs:
- ART26.12 delivered favorable first‑in‑human safety and PK (SAD) results; Food Effect assessment supported dosing fed or fasted, enabling MAD study planning in Q4 2025 .
- ART27.13 Phase 2 CAReS initial data remains on track for Q3 2025, with 15 clinical sites open as of June 20, 2025 .
Positive UK regulatory feedback:
- MHRA affirmed a streamlined first‑in‑human plan for ART12.11 and proposed potential eligibility for ILAP, which may accelerate development timelines .
Management emphasizing disciplined capital strategy:
- Company adopted a Digital Asset Treasury policy (Solana), with staged investments and qualified custody; Board oversight and reporting processes articulated .

What Went Wrong

Earnings miss and spend increase:
- EPS of $(5.61) missed consensus, driven by higher professional fees tied to capital raising and increased program R&D; G&A up 55% YoY and R&D up 11% YoY in Q2 .
Working capital deteriorated:
- Working capital fell to $(3.479)M at June 30, 2025 vs. $(1.422)M at March 31, 2025, intensifying going‑concern risk disclosed in filings .
Financing reliance continues:
- Issued $0.9M convertible notes at 12% interest and completed a $1.425M private placement in June; subsequent $9.475M PIPE announced in August underscores ongoing external capital needs .

Financial Results

Metric	Q2 2024	Q1 2025 (post-split)	Q2 2025
Revenue ($USD Millions)	$0.0	$0.0	$0.0
Total Operating Expenses ($USD Millions)	$2.512	$2.379	$3.150
Operating Loss ($USD Millions)	$(2.512)	$(2.379)	$(3.150)
Net Loss ($USD Millions)	$(2.433)	$(2.372)	$(3.221)
Diluted EPS ($USD)	$(4.52)	$(4.34)	$(5.61)
Cash and Equivalents (period-end, $USD Millions)	$0.881	$0.746	$2.066
Working Capital ($USD Millions)	N/A	$(1.422)	$(3.479)

Operating Expense Detail:

Metric	Q2 2024	Q1 2025	Q2 2025
G&A ($USD Millions)	$0.827	$0.995	$1.279
R&D ($USD Millions)	$1.685	$1.384	$1.871

Share Count Snapshot (period-end):

Metric	Q2 2024	Q1 2025	Q2 2025
Common Shares Outstanding	538,000	567,582	704,425

Comparison vs Estimates:

Metric	Q2 2025 Consensus	Q2 2025 Actual
Primary EPS Consensus Mean	$(4.19)*	$(5.61)
Revenue Consensus Mean ($USD Millions)	$0.0*	$0.0
Primary EPS - # of Estimates	1*	—
Revenue - # of Estimates	1*	—

Values retrieved from S&P Global.*

Observations:

EPS missed consensus; revenue aligned at $0.
Expense growth (professional fees, R&D) and interest expense on notes weighed on EPS .

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Financial guidance (revenue, margins, EPS)	FY/Q3+	None provided	None provided	Maintained (no formal guidance)
Capital strategy – DAT (SOL purchases)	Q3–Q4 2025	N/A	Board‑approved staged SOL acquisitions; $250k initial, net proceeds from $9.475M PIPE to purchase SOL	New policy
Liquidity/going concern disclosure	Next 12 months	Substantial doubt	Substantial doubt; pursuit of financing continues	Maintained

Note: Management did not issue formal revenue or margin guidance in Q2 materials.

Earnings Call Themes & Trends

No Q2 2025 earnings call transcript was available for ARTL.

Topic	Previous Mentions (Q2 2024, Q1 2025)	Current Period (Q2 2025)	Trend
R&D execution (ART26.12)	Phase 1 initiated; enrollment completed by Q2 2025	SAD safety/PK positive; Food Effect supports fed/fasted dosing; MAD planned Q4 2025	Accelerating
CAReS (ART27.13) timeline	Phase 2a enrolling; initial results targeted H1/H2 2025	Initial Phase 2 data targeted Q3 2025 (15 sites active)	On track
Regulatory (ART12.11)	Preparations for human studies 2H 2025	MHRA positive advice; potential ILAP consideration	Improving visibility
Funding/Capital markets	Equity line; small equity raises	$0.9M notes; $1.425M private placement; ATM; $9.475M PIPE announced	Active financing
DAT (Digital Asset Treasury)	Not present	Formal SOL strategy; custody controls; fair value accounting (ASU 2023‑08)	New initiative
Macro/regulatory risk	Tariffs/geopolitics, FDA policy uncertainty	Continued disclosure of macro risks and regulatory scrutiny	Unchanged

Management Commentary

“We are on track to report initial data from the Phase 2 CAReS study of ART27.13 … in Q3 2025.”
“The increase in operating expenses… was primarily the result of increases in professional fees associated with our capital raising efforts and increases in research and development expenditures related to our clinical programs.”
On DAT: “Holdings are measured at fair value… changes in fair value flow through net income each reporting period… we will attempt to maintain a separate reserve of liquid cash resources sufficient to fund at least twelve months of projected operating expenses.”
On ART26.12: “We are greatly encouraged with the results of the SAD study… safety and PK profile translated well to the human experience.”
On ART12.11: “MHRA… provides a scientifically justified basis for a streamlined… plan… proposed that ART12.11 may be a candidate for ILAP.”

Q&A Highlights

No Q&A session was available for Q2 2025. Key clarifications from filings:

Liquidity and going‑concern risks reiterated; active pursuit of additional capital including ATM and PIPE .
DAT governance, custody, and accounting treatment (ASU 2023‑08) detailed; no staking or encumbrances without Board approval .
Program timelines: CAReS initial readout Q3 2025; ART26.12 MAD Q4 2025; ART12.11 FIH pathway in the UK under MHRA guidance .

Estimates Context

EPS missed S&P Global consensus: Actual $(5.61) vs. $(4.19)*; single estimate coverage underscores limited analyst visibility .
Revenue in-line at $0* amid development‑stage status; future estimate revisions likely to focus on opex trajectory, financing costs, and fair‑value impacts from DAT.
Values retrieved from S&P Global.*

Key Takeaways for Investors

Near‑term readout catalyst: CAReS Phase 2 initial data in Q3 2025 could be stock‑moving given lack of approved therapies in cancer anorexia; watch efficacy signals on lean mass/weight gain .
R&D momentum: ART26.12 advancing to MAD in Q4 2025 with benign safety/PK to date; adds optionality in non‑opioid pain and CIPN .
Liquidity watch: Working capital of $(3.479)M and ongoing financing (notes, private placements, ATM, PIPE) emphasize dilution and cost of capital risks; monitor cash runway and ATM/PIPE execution .
DAT implications: SOL fair‑value accounting could introduce earnings volatility; governance and custody controls mitigate operational risk but do not reduce P&L swings .
Expense discipline: YoY increases tied to capital raising and program spend drove EPS miss; stabilization of professional fees and R&D pacing will be critical to narrowing losses .
Regulatory de‑risking: MHRA advice and potential ILAP for ART12.11 improves path clarity; watch for CTA progress and FIH start .
Risk posture: Continued going‑concern disclosure and macro/regulatory uncertainties remain; position sizing should reflect binary clinical and financing outcomes .

Notes on documents reviewed:

8‑K Item 2.02 (July 11, 2025) provided preliminary Q2 cash and working capital ($2.1M cash; $(1.2)–$(1.5)M working capital), later superseded by 10‑Q final numbers ($2.066M cash; $(3.479)M working capital) .
No Q2 2025 earnings call transcript was found for ARTL within the period searched.

ARTELO BIOSCIENCES, INC. (ARTL)·Q2 2025 Earnings Summary