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CytomX Therapeutics, Inc. (CTMX)·Q3 2024 Earnings Summary

Executive Summary

  • Q3 2024 revenue was $33.4M, up 33% year over year and 33% sequentially; GAAP diluted EPS was $0.07, a swing from a $(0.08) loss in Q2 and up from $0.04 in Q3 2023 .
  • Pipeline advanced: CX-904 cleared the 15 mg step-dosing cohort (no MTD reached), CX-2051 reached cohort 5 with favorable tolerability, and first CX-801 patient was dosed; management now anticipates potential Phase 1b initiation for CX-904 in 2025, deferring any 2024 decision .
  • Operating discipline: total operating expenses fell sequentially to $29.3M (from $33.6M in Q2), helping deliver positive operating income; cash, cash equivalents and investments ended at $117.6M, with runway to end of 2025 (ex-milestones) .
  • Stock reaction catalysts near term: the timing shift of CX-904 Phase 1b decision to 2025 may temper expectations, while continued dose escalation progress, CX-2051 initial data in H1 2025, and CX-801 initial data in H2 2025 are upcoming validation events .

What Went Well and What Went Wrong

  • What Went Well
    • Cleared 15 mg step-dosing for CX-904 with no MTD reached; continued escalation across PDAC, HNSCC, and NSCLC cohorts, demonstrating tolerability and dose-response focus. “A maximum tolerated dose has not been reached for step dosing and escalation continues” .
    • Rapid CX-2051 progress to dose cohort 5 in ~6 months with “favorable safety profile… suggesting masking is functioning as designed,” maintaining track for initial data in H1 2025 .
    • Financial execution: sequential op-ex decline and higher collaboration revenue (BMS, Moderna) drove operating income and net income; CFO highlighted discipline and capital allocation to 2025 milestones .
  • What Went Wrong
    • Timing deferral: management does not expect a CX-904 Phase 1b decision in 2024; potential initiation now anticipated in 2025, pushing out a key inflection point .
    • R&D spend elevated year over year (+$4.9M to $21.4M) on CX-2051 manufacturing/clinical and CX-904 clinical costs, reflecting intensifying development needs .
    • Estimates comparison unavailable: S&P Global consensus retrieval failed at time of analysis, limiting visibility on Street beat/miss context for traders (we attempted but hit API daily limit) [GetEstimates attempt error: Daily Request Limit Exceeded]*.

Financial Results

MetricQ1 2024Q2 2024Q3 2024
Revenue ($USD Millions)$41.463 $25.115 $33.432
Income from Operations ($USD Millions)$11.657 $(8.452) $4.111
Net Income ($USD Millions)$13.791 $(6.534) $5.736
Diluted EPS ($USD)$0.17 $(0.08) $0.07
R&D ($USD Millions)$22.052 $25.172 $21.368
G&A ($USD Millions)$7.754 $8.395 $7.953
Total Operating Expenses ($USD Millions)$29.806 $33.567 $29.321
EBIT Margin %28.1% -33.7% 12.3%
Net Income Margin %33.3% -26.0% 17.2%
MetricQ3 2023Q3 2024
Revenue ($USD Millions)$26.384 $33.432
Net Income ($USD Millions)$2.992 $5.736
Diluted EPS ($USD)$0.04 $0.07
R&D ($USD Millions)$16.448 $21.368
G&A ($USD Millions)$6.813 $7.953
Total Operating Expenses ($USD Millions)$23.261 $29.321
EBIT Margin %11.8% 12.3%
Net Income Margin %11.3% 17.2%

KPIs

KPIQ1 2024Q2 2024Q3 2024
Cash, Cash Equivalents & Investments ($USD Millions)$150.3 $137.2 $117.6
Cash & Equivalents ($USD Millions)$36.185 $43.247 $40.576
Short-term Investments ($USD Millions)$114.099 $93.935 $77.012
Accounts Receivable ($USD Millions)$13.177 $2.775 $3.352
Deferred Revenue – Current ($USD Millions)$123.628 $123.766 $96.063
Deferred Revenue – Noncurrent ($USD Millions)$59.743 $36.710 $33.556
Accrued Liabilities ($USD Millions)$14.220 $13.620 $16.742
Total Liabilities ($USD Millions)$216.367 $190.446 $162.433
Stockholders’ Deficit ($USD Millions)$(31.680) $(31.227) $(23.452)

Note: Where margins are shown, they are derived from cited revenue and operating/net income figures above.

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
CX-904 Phase 1 program decision/initiation2024–2025Expected 2024 program update with potential decision to initiate Phase 1b by end of 2024 No Phase 1b decision in 2024; potential Phase 1b initiation in 2025 (pending optimized dose/schedule and Amgen alignment) Lowered/Deferred timing
CX-2051 initial Phase 1a dataH1 2025Initial data H1 2025 Initial data H1 2025 (unchanged) Maintained
CX-801 initial Phase 1a dataH2 2025Initial data in 2025/H2 2025 Initial data H2 2025 (unchanged) Maintained
Cash runwayThrough 2025Not explicitly stated in prior quartersSufficient to fund operations to end of 2025 (excluding potential milestones) New disclosure/clarified

Earnings Call Themes & Trends

TopicPrevious Mentions (Q-2 and Q-1)Current Period (Q3 2024)Trend
CX-904 dose escalation/MTDPositive initial Phase 1a data; focus on PDAC, NSCLC, HNSCC; program update expected by end 2024 Cleared 15 mg step dose; no MTD reached; decision deferred to 2025; alignment with Amgen prioritized Continued escalation; timeline pushed
CX-2051 tolerability/progressFirst patient dosed; cohort 3 opened; initial data H1 2025 Enrolling cohort 5; favorable safety profile; masking functioning; initial data H1 2025 Advancing on track
CX-801 initiationSite activation; KEYTRUDA supply agreement; initial data in 2025/H2 2025 First patient dosed; monotherapy then KEYTRUDA combo; initial data H2 2025 Initiated; progressing
Partnerships & milestonesAstellas $10M milestones YTD; active programs with Amgen, BMS, Moderna, Regeneron Continued progress across partners; majority focus on masked TCEs; potential additional milestones next year Ongoing; supportive funding
Capital allocation disciplineNoted discipline; cash balance updates Disciplined allocation to 2025 milestones; runway to end 2025 Maintained focus

Management Commentary

  • “We’re pleased to report that the 15-milligram step dosing cohort has cleared. A maximum tolerated dose has not been reached for step dosing and escalation continues.” – Sean McCarthy, CEO .
  • “We are already enrolling the fifth dose escalation cohort… and we have observed a favorable safety profile for CX-2051 to date, suggesting that masking is functioning as designed.” – Sean McCarthy .
  • “As of September 30, 2024, we ended the quarter with $118 million in cash, cash equivalents and investments… We expect that our cash balance will continue to fund CytomX operations to the end of 2025.” – Chris Ogden, CFO .
  • “Looking ahead to 2025, we’re well positioned to deliver multiple clinical data readouts across the pipeline… and we remain focused on advancing CX-904, CX-2051 and CX-801 to clinical proof of concept.” – Sean McCarthy .

Q&A Highlights

  • CX-904 Phase 1b decision criteria and timing: Management emphasized continuing dose escalation to maximize dose intensity; no decision in 2024; data package with Amgen will drive potential 2025 Phase 1b initiation .
  • CX-2051 dosing window: Cohort 5 is within modeled doses where unmasked ADCs show GI toxicity; masking appears effective thus far; more detail expected H1 2025 .
  • Enrollment across tumor types: Increased emphasis on HNSCC and NSCLC alongside PDAC; 15 mg cleared enables enrollment at higher dose levels .
  • Monotherapy vs combination for CX-904: Focus remains on monotherapy in early stages; combination strategies may be considered later in consultation with Amgen .
  • EpCAM expression selection strategy: CRC likely “all comers” given >90% high expression; other tumors may use IHC-based selection as needed .

Estimates Context

  • We attempted to retrieve S&P Global consensus EPS and revenue estimates for Q1–Q3 2024, but the request failed due to a daily API limit exceeded; therefore, a formal beat/miss vs Street consensus cannot be provided at this time (will update when SPGI access resumes) [GetEstimates attempt error: Daily Request Limit Exceeded]*.
  • Given biotech-specific revenue recognition from collaborations, Street estimates can be sensitive to milestones and percentage-of-completion accounting; any material milestones or collaboration work shifts (e.g., BMS, Moderna, Astellas) may drive estimate revisions .

*Values referenced from S&P Global were unavailable due to API limit at time of analysis.

Key Takeaways for Investors

  • Sequential financial inflection: Stronger collaboration revenues and lower sequential op-ex delivered positive operating and net income; near-term visibility depends on partner program cadence (BMS, Moderna) .
  • CX-904 de-risking via tolerability: 15 mg step-dosing cleared without reaching MTD supports potential for higher dosing and efficacy exploration; however, Phase 1b decision deferral to 2025 removes a late-2024 catalyst .
  • CX-2051 is progressing rapidly: Cohort 5 entry with favorable safety suggests masking is working; H1 2025 initial data is a central value inflection point .
  • CX-801 initiated: First patient dosed and combination plans with KEYTRUDA provide optionality; initial data expected H2 2025 .
  • Funding runway through 2025: ~$117.6M cash & investments and reduced liabilities support execution to upcoming readouts; milestone upside not included in runway .
  • Watch for 2025 catalysts: CX-2051 H1 data, CX-801 H2 data, and CX-904 Phase 1b initiation decision with Amgen; sentiment likely tied to emerging efficacy signals and safety durability .
  • Trading lens: The 2024 deferral of CX-904 Phase 1b timing could cap near-term momentum, but continued dose escalation and strong collaboration revenue trends aid downside support; positioning ahead of H1 2025 data may be tactical for pipeline-upside exposure .