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PRECISION BIOSCIENCES INC (DTIL)·Q3 2025 Earnings Summary

Executive Summary

  • Q3 results were weak vs. Street: revenue of $0.013M missed consensus $5.4M by ~$5.4M and EPS of ($1.84) missed consensus ($1.34) by $0.50; y/y revenue fell from $0.576M as Novartis-related billable effort tapered and other collaboration revenue rolled off. Bold miss driven by minimal collaboration revenue recognition and unfavorable warrant revaluation/other income versus prior periods. Actuals: Revenue $0.013M; EPS ($1.84). Street: Revenue $5.4M; EPS ($1.34). (Street estimates from S&P Global)*
  • Operating discipline is visible: total OpEx fell to $20.7M (vs. $21.9M in Q2 and $21.9M in Q3’24), reflecting July cost actions; cash, cash equivalents and restricted cash were $71.2M with runway guided into 2H27.
  • Pipeline momentum: PBGENE‑HBV advanced with Cohort 3 dosing and a late‑breaking AASLD oral featuring new data; PBGENE‑DMD remains on track for IND by year‑end 2025, Phase 1 start 1H26, first data 2H26.
  • Mixed partner dynamics near-term: DTIL received an $8M milestone from Imugene (Oct 31), but Novartis issued termination notice (effective Jan 30, 2026), raising future collaboration revenue uncertainty.

What Went Well and What Went Wrong

  • What Went Well

    • HBV clinical progress and visibility: “late‑breaking oral” at The Liver Meeting 2025; Cohort 3 dosing initiated; Cohort 1 showed durable ~50% HBsAg reduction in one patient and activity across cohort with favorable safety profile enabling escalation.
    • DMD program execution: Completed tox and manufacturing preparation, World Muscle Society poster highlighted durable dystrophin expression and functional improvements; IND planned by YE25, Phase 1 start 1H26, initial data 2H26.
    • Liquidity runway: Cash of $71.2M and runway guided into 2H27 after operating efficiencies; supports HBV and DMD clinical milestones.

  • What Went Wrong

    • Revenue air pocket: Q3 revenue $0.013M vs. $0.576M y/y, driven by reduced Novartis billable effort and roll-off of prior period collaboration recognition.
    • EPS miss: ($1.84) vs. Street ($1.34) reflecting minimal revenue and negative swing in non-operating items (e.g., warrant liability mark) relative to prior-year tailwinds. (Street from S&P Global)*
    • Partner overhang: Novartis termination notice (effective Jan 30, 2026) injects uncertainty into future collaboration monetization; though partially offset by $8M Imugene milestone (Oct 31).

Financial Results

P&L trend (oldest → newest)

Metric (USD)Q3 2024Q1 2025Q2 2025Q3 2025
Revenue ($ Millions)$0.576 $0.029 $0.018 $0.013
Total Operating Expenses ($ Millions)$21.851 $22.141 $21.895 $20.680
Operating Loss ($ Millions)$(21.275) $(22.112) $(21.877) $(20.667)
Net Loss ($ Millions)$(16.425) $(20.565) $(23.520) $(21.772)
Diluted EPS ($)$(2.25) $(2.21) $(2.13) $(1.84)

Q3 2025 vs. Wall Street estimates (S&P Global)

MetricStreet (Q3’25E)Actual Q3’25Surprise
Revenue ($ Millions)$5.400*$0.013 —$5.387 (miss)
Diluted EPS ($)$(1.34)*$(1.84) —$0.50 (miss)
Est. Count (Rev / EPS)3 / 3*——

Values marked with * retrieved from S&P Global.

Notes:

  • Revenue decline reflects reduced billable work under the Novartis collaboration nearing completion and prior collaboration revenue roll‑offs.
  • OpEx fell sequentially and y/y after July cost actions; management continues to target operating efficiencies.

Balance sheet snapshot and liquidity KPIs

KPIQ1 2025Q2 2025Q3 2025
Cash, Cash Equivalents & Restricted Cash ($ Millions)$99.789 $84.806 $71.212
Cash Runway GuidanceInto 2H26 Into 2H27 Into 2H27

Segment breakdown: DTIL reports a single operating segment (in vivo gene editing based on ARCUS); no segment revenue disclosure.

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Cash runwayCorporateInto 2H26 (Q1’25) Into 2H27 (Q2’25, reiterated Q3’25) Raised in Q2; maintained
PBGENE‑HBV data timingClinical“Data update later 2025” (Q2’25) Additional readouts early 2026 (Q3’25) Timing pushed
PBGENE‑DMD INDRegulatoryTarget 2025 (Q1’25) IND by YE25 (Q3’25) Maintained (more specific)
PBGENE‑DMD Phase 1 startClinical2026 (implied) 1H26 start; initial data 2H26 (Q3’25) Clarified/maintained
Collaboration revenues2025n/aLess Novartis billable effort in Q3; Novartis termination effective 1/30/26 noted (10‑Q Subsequent Events) Negative medium‑term setup

Earnings Call Themes & Trends

(There was no dedicated Q3 earnings call transcript available; themes synthesized from Q1/Q2 press materials and October conference transcript.)

TopicPrevious Mentions (Q1’25 and Q2’25)Current Period (Q3’25)Trend
HBV clinical progress and curative intentQ1: initial Cohort 1 safety post first admin, Fast Track; plan cohort‑level efficacy updates in 2025. Q2: Cohort 1 efficacy (HBsAg −47% to −69% best responses; one durable ~50% at 7 months), Cohort 2 safety; plan Cohort 3. Cohort 3 dosing commenced; late‑breaking AASLD oral with new cohort data; safety maintained; durable activity emphasized. Positive momentum; visibility up
DMD program executionQ1: prioritized, target 2025 IND; preclinical functional gains. Q2: FDA Rare Pediatric Disease and Orphan designations. Q3: IND by YE25; Phase 1 1H26; initial data 2H26; poster shows durable dystrophin expression and function.
Cash runway and OpEx disciplineQ1: runway into 2H26. Q2: raised runway to 2H27; July cost actions to reduce 2026/2027 cash OpEx by ~$25M/yr. Q3: runway reiterated to 2H27; OpEx down q/q and y/y.
Partner dynamicsiECURE: ongoing OTC‑HOPE data updates; second infant dosed (Q1/Q2). Imugene DLBCL updates; planned FDA Type C for pivotal; DTIL receives $8M milestone Oct 31. Novartis termination notice effective 1/30/26.
Regulatory/DesignationsHBV Fast Track; DMD Rare Pediatric and Orphan (Q2). U.S. patent issuance for HBV nuclease to 2042. IP strengthened

Management Commentary

  • CEO Michael Amoroso (press release): “The PBGENE‑HBV data presented so far this year has shown proof of durable activity and a safety profile that allows us to continue dose escalation in pursuit of achieving a complete cure for hepatitis B patients… in 2026 we anticipate starting the first‑in‑human clinical trial with our second program, PBGENE‑DMD…”
  • HBV program update: “Given the favorable safety profile of Cohorts 1 and 2, the Data Monitoring Committee recommended the Company to proceed with dosing Cohort 3 which occurred during the third quarter of 2025.”
  • DMD program detail: “Dystrophin protein was detected in all muscles evaluated… with increased expression observed at nine months… resulting in substantial and sustained functional muscle improvement.”
  • CFO (prior quarter context on cost actions): “We initiated an operating efficiency program… aimed at reducing our annual cash operating expenses in each of 2026 and 2027 by approximately $25 million compared to the 2025 annual cash expense level.”

Q&A Highlights

(From October Chardan Genetic Medicines Conference transcript)

  • Off‑target and safety expectations: Management emphasized a well‑established regulatory path for off‑target assessment; focus is on characterizing potential impact in context of indication risk and maintaining repeat‑dose safety in the liver.
  • HBV strategy vs. alternatives: DTIL underscored cccDNA elimination as key to a definitive cure and differentiation vs. RNAi/epigenetic silencing approaches which do not remove cccDNA.
  • Commercial opportunity in HBV: Management highlighted the large global population and an LNP‑based, repeat‑dose regimen as commercially feasible if curative outcomes are demonstrated.
  • Regulatory tone: Interactions with FDA characterized as pragmatic and flexible for advanced therapies; focus on areas of high unmet need.

Estimates Context

  • Street expected Q3’25 revenue of $5.4M and EPS of ($1.34) (3 estimates each); DTIL delivered $0.013M and ($1.84), respectively — a significant miss on both lines. Actuals reflect negligible collaboration revenue recognition in the quarter and lower other income vs. prior periods. (S&P Global for estimates)*
  • Implications: Consensus likely needs to recalibrate near‑term collaboration revenue and non‑operating items. Pipeline milestones (AASLD HBV readout timing shift to early 2026; DMD IND YE25) may shift timing of sentiment catalysts rather than fundamental P&L in the next 1–2 quarters.

Values marked with * retrieved from S&P Global.

Key Takeaways for Investors

  • Core P&L remains a function of collaboration accounting and non‑operating swings; Q3’s revenue/EPS miss was driven by minimal Novartis billables and warrant liability marks rather than OpEx blowouts, with OpEx trending lower post cost actions.
  • HBV momentum continues (Cohort 3 dosing; durable HBsAg reductions; AASLD late‑breaker), but next data has shifted to early 2026 — recalibrate catalyst timing.
  • DMD is the second leg of the story: IND by YE25, Phase 1 start 1H26, initial data 2H26; preclinical data show durable, functional improvements with near‑full‑length dystrophin restoration.
  • Liquidity appears sufficient into 2H27 to reach multiple readouts; cash was $71.2M at Q3 end, with potential to augment via milestones/ATM.
  • Partner dynamics are mixed: $8M Imugene milestone is a positive cash inflow; Novartis termination effective early 2026 removes a collaboration tailwind and raises medium‑term BD importance.
  • The narrative likely pivots from quarterly revenue to clinical proof: near‑term stock drivers are HBV (AASLD and early‑2026 updates) and DMD (IND filing, first‑in‑human progress), not quarterly sales.

Additional details

  • Q3 2025 8‑K/Press release (Item 2.02 with Exhibit 99.1) furnished Nov 3, 2025; financial tables included (revenue, OpEx, EPS) and pipeline/business updates.
  • Q3 2025 10‑Q provides expanded financials, MD&A context, and subsequent events (Imugene milestone; Novartis termination).

No Q3 2025 earnings call transcript was available; management commentary was sourced from Q3 press materials and an October 2025 conference transcript. –

Footnote: Values marked with * were retrieved from S&P Global.