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ARVINAS, INC. (ARVN)·Q3 2025 Earnings Summary

Executive Summary

  • Q3 revenue beat expectations and improved sequentially: Revenue $41.9M vs S&P Global consensus $27.6M; EPS $(0.48) vs $(0.74) consensus, driven by a $20M Novartis milestone and lower R&D/G&A after restructuring . Estimates marked with *; Values retrieved from S&P Global.
  • Pipeline momentum: ARV-102 (LRRK2) showed brain penetration and CSF biomarker modulation in HVs; multiple-dose PD cohort ongoing with CSF data expected in 2026; PSP Phase 1b planned 1H26 .
  • Vepdegestrant NDA accepted; PDUFA June 5, 2026; Arvinas and Pfizer will select a third party to commercialize; plan to have a partner in place before PDUFA to ensure launch readiness .
  • Expense discipline and runway intact: Cash/marketable securities $787.6M; non-GAAP opex trending ≤$75M/quarter; goal ≤$300M in FY26; runway into 2H 2028; repurchased ~2.56M shares at ~$7.91 avg in Q3 .

What Went Well and What Went Wrong

  • What Went Well
    • Clear revenue/EPS beat vs consensus; revenue aided by $20M Novartis milestone; materially lower G&A YoY due to lease termination and cost controls .
    • ARV-102 differentiated biomarker package: ≥90% PBMC and >50% CSF LRRK2 reduction; CSF proteomics showed decreases in lysosomal/neuroinflammatory markers after 14 days in HVs—viewed as potential class-leading biology .
    • Vepdegestrant regulatory progress: NDA accepted; PDUFA set; positive PROs from VERITAC-2 and activity in TACTIVE-N at ESMO, supporting best-in-class ambition in ESR1m 2L+ .
  • What Went Wrong
    • Collaboration revenue headwinds vs prior year persisted (Q3 revenue down YoY from $102.4M), reflecting completion/termination of prior agreements (Novartis/Bayer) and lower vepdegestrant collaboration revenue; offset by the $20M milestone .
    • Continued operating loss: Q3 net loss $(35.1)M despite opex reductions; interest income down YoY, limiting non-operating offset .
    • Strategic uncertainty around vepdegestrant commercialization model until third-party selection finalized; management emphasizes no internal commercial build, which introduces execution dependency on partner timing .

Financial Results

MetricQ1 2025Q2 2025Q3 2025
Revenue ($M)$188.8 $22.4 $41.9
Diluted EPS ($)$1.14 $(0.84) $(0.48)
Net Income (Loss) ($M)$82.9 $(61.2) $(35.1)
Net Income Margin (%)43.9% (82.9/188.8) (273.7)% (−61.2/22.4) (83.8)% (−35.1/41.9)
R&D (GAAP, $M)$90.8 $68.6 $64.7
G&A (GAAP, $M)$26.6 $25.3 $21.0
R&D (Non-GAAP, $M)$79.3 $59.5 $56.9
G&A (Non-GAAP, $M)$23.1 $20.2 $14.6
Cash, Cash Equivalents & Marketable Securities ($M)$954.3 $861.2 $787.6
Weighted Avg Shares (Basic & Diluted, M)72.7 diluted 73.0 diluted 73.2 basic/diluted

Performance vs S&P Global Consensus (estimates marked with *, Values retrieved from S&P Global)

MetricQ1 2025Q2 2025Q3 2025
Revenue ($M)$188.8 vs $41.9* $22.4 vs $34.4* $41.9 vs $27.6*
Primary EPS ($)$1.14 vs $(0.97)* $(0.84) vs $(0.89)* $(0.48) vs $(0.74)*

KPIs and Other Items

KPIQ1 2025Q2 2025Q3 2025
Deferred Revenue ($M)$259.4 (141.0 current + 118.4 LT) $237.0 (102.9 + 134.1) $215.1 (87.7 + 127.4)
Interest & Other Income ($M)$11.7 $10.0 $9.0
Stock Repurchase (shares/M, avg price)——~2.56M at $7.91 avg

Segment breakdown: Not applicable; revenue primarily from collaboration agreements and milestones .

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Cash runwayThroughInto 2H 2028 (Q2 update) Into 2H 2028 (reaffirmed) Maintained
Quarterly non-GAAP opexNear termNot previously quantifiedTarget < $75M/quarter New
FY26 non-GAAP expensesFY2026Not previously quantifiedTarget < $300M New
Vepdegestrant PDUFANDANot set in Q2June 5, 2026 Established
Vepdegestrant commercializationLaunchCo-commercialization under review Plan to select third party; aim partner before PDUFA Strategy clarified

Earnings Call Themes & Trends

TopicPrevious Mentions (Q1–Q2 2025)Current Period (Q3 2025)Trend
Vepdegestrant strategyRemoved first-/second-line combo Phase 3; restructuring to extend runway; NDA submission planned NDA accepted; PDUFA 6/5/26; selecting third-party commercial partner; aim partner in place pre-PDUFA From development reset to regulatory/partnering execution
ARV-102 (LRRK2)HV SAD/MAD showed brain penetration, ≥50% CSF and ≥90% PBMC LRRK2 reduction; PD SAD ongoing HV CSF proteomics changed lysosomal/microglial markers after 14 days; PD multiple-dose cohort ongoing; PD CSF data 2026; PSP Phase 1b planned 1H26 Strengthening differentiation; moving into patient MAD and PSP
ARV-393 (BCL6)Preclinical single-agent and broad combinability; Phase 1 ongoing Early responses in B- and T-cell NHL at sub-efficacious exposures; planning combo with glofitamab in 2026 From preclinical to early clinical signal; combo roadmap
ARV-806 (KRAS G12D)IND cleared; Phase 1 initiated Preclinical shows ~25x vs inhibitors and durable >90% degradation; Phase 1 enrolling fast; evaluating EGFR combos; aim for initial clinical data in 2026 Rapid advancement; combo potential
Cost discipline/runwayWorkforce reduction; runway into 2H28 Opex declining; explicit targets (<$75M/qtr; <$300M FY26); runway reiterated Increased specificity on opex targets

Management Commentary

  • “We have entered the beginning of a data-rich period with multiple readouts from our early-stage clinical programs.” — John Houston, CEO .
  • “In healthy volunteers treated with 80 mg of ARV-102 once daily for 14 days, [CSF proteomics] showed decreases in lysosomal pathway markers and neuroinflammatory microglial markers…direct evidence that [our] approach is working as designed.” — Noah Berkowitz, CMO .
  • “Our goal is to continue with a quarterly run rate spend below $75 million…to manage non-GAAP expenses below $300 million in fiscal year 2026.” — Andrew Saik, CFO .
  • “We and Pfizer will jointly select a third party for the commercialization and potential further development of vepdegestrant…with the goal of rapidly bringing it to patients, if approved.” — Company statement .

Q&A Highlights

  • BCL6 differentiation: Early responses in both B- and T-cell lymphomas even below predicted efficacious exposures; combo path with CD20 bispecifics (glofitamab) seen as attractive due to orthogonal MoA and potential to increase CD20 expression .
  • LRRK2 expectations: PD multiple-dose study is 28 days; expect principally biomarker data with potential early clinical signals; CSF LRRK2 degradation data to be shared post-MAD completion in 2026; PSP Phase 1b in 1H26 .
  • KRAS G12D: Strategy to “win on potency” to avoid transaminitis-limited dosing seen elsewhere; once-weekly dosing today with potential q2w; exploring EGFR inhibitor combinations (e.g., cetuximab) .
  • Vepdegestrant partnering: Company not building a salesforce; intends to have Pfizer or a third party launch with no gap at approval; active collaboration restructuring underway .

Estimates Context

  • Q3: Revenue $41.9M beat vs $27.6M*; EPS $(0.48) beat vs $(0.74)*, helped by $20M Novartis milestone and lower opex .
  • Q2: Revenue $22.4M missed vs $34.4M* due to lower collaboration revenue; EPS $(0.84) slightly better than $(0.89)* .
  • Q1: Revenue $188.8M and EPS $1.14 dramatically beat vs $41.9M* and $(0.97)*, driven by collaboration accounting changes after removal of Phase 3 combo trials from the Pfizer plan .
  • Implications: Street models likely lift near-term revenue/EPS on vep milestone cadence and leaner opex. However, medium-term collaboration revenue remains variable; partner decision on vepdegestrant will shape 2026+ revenue trajectory. Estimates marked with *; Values retrieved from S&P Global.

Key Takeaways for Investors

  • Near-term catalysts: Vepdegestrant PDUFA (6/5/26) and commercialization partner selection; ARV-102 PD multiple-dose biomarker update and PSP study initiation in 1H26; initial ARV-806 clinical data in 2026; ARV-393 clinical update in 2026 .
  • Expense runway intact with tighter targets (<$75M/qtr; <$300M FY26), extending optionality through multiple readouts into 2H28—supports multiple shots on goal without new capital .
  • LRRK2 package is emerging as a potential class-leader with CSF proteomics movement in HVs and robust degradation—watch PD MAD data in 2026 for validation of disease pathway engagement .
  • KRAS G12D program differentiated by potency and durability; combinations (EGFR inhibitors; chemotherapy) may unlock broader efficacy with a potentially better benefit-risk profile .
  • BCL6 early clinical responses across B- and T-cell lymphomas plus strong combo rationale with CD20 bispecifics set up for a differentiated lymphoma backbone if signals persist .
  • Stock sensitivities: Partnering outcome/timing for vepdegestrant; quality of 2026 ARV-102 and ARV-806 data; sustained opex control vs guidance.

Notes:

  • All company data and quotes cited from Q3 2025 8-K and earnings call; prior-quarter references from Q1/Q2 2025 filings and calls.
  • Consensus figures marked with * are from S&P Global; Values retrieved from S&P Global.