IO Biotech, Inc. (IOBT)·Q2 2025 Earnings Summary

Executive Summary

• Q2 2025 delivered a larger net loss and higher OpEx as IO Biotech advanced Cylembio toward potential BLA, while topline Phase 3 melanoma data showed a clinically meaningful PFS improvement but narrowly missed the pre-specified significance threshold (HR=0.77; p=0.056) .
• Management will meet the FDA in fall 2025 to discuss a potential regulatory submission; an OS trend favored the combo arm (HR=0.79; immature), with particularly strong benefit in PD‑L1–negative tumors (mPFS 16.6 vs 3.0 months; HR=0.54; nominal p=0.006) .
• Cash and equivalents fell to $28.1M at quarter-end; with €12.5M from the EIB second tranche received on July 4, management expects runway into 1Q26 (down from 2Q26 outlook in Q1) .
• Stock-moving catalysts: FDA feedback on Phase 3 package and BLA path; subsequent OS maturation in 6–9 months; detailed Phase 3 disclosure and Phase 2 readouts in 2H25/2026 .

What Went Well and What Went Wrong

• What Went Well

  • Robust clinical signal despite primary endpoint miss: mPFS 19.4 vs 11.0 months (HR=0.77; p=0.056) with early and sustained curve separation; OS trending better (HR=0.79; immature) .
  • Profound benefit in high‑need subgroup: PD‑L1–negative tumors mPFS 16.6 vs 3.0 months (HR=0.54; nominal p=0.006) .
  • Safety and tolerability in line with pembro alone; no new systemic toxicities; injection site reactions were transient and expected (56% vs 1%) .
  • CEO: “With the notable safety profile and clinical improvement observed... focused on discussing the results with the FDA and determining the next steps for a potential... BLA” .

• What Went Wrong

  • Primary endpoint narrowly missed statistical significance (p threshold 0.045 vs observed p=0.056), raising regulatory risk on full-population approval .
  • Cash runway updated to 1Q26 (was 2Q26 in Q1), reflecting higher burn and timeline needs despite EIB proceeds .
  • EPS loss widened YoY and QoQ as OpEx rose with late‑stage clinical execution (Q2 net loss $26.217M vs $22.421M in Q1 and $20.686M in Q2’24) .

Financial Results

• Summary P&L, cash, and OpEx trends

• Consensus vs Actual (S&P Global)

Values marked with * retrieved from S&P Global.

Context:

• Company reports no product revenue and provides operating expense and loss details; GAAP EPS for Q2 was $(0.40) while S&P’s “Primary EPS” actual was -$0.334*, reflecting a differing methodology base .

KPIs (Clinical)

Guidance Changes

Earnings Call Themes & Trends

Management Commentary

• CEO, on Phase 3: “With the notable safety profile and clinical improvement observed in this trial, we are focused on discussing the results with the FDA and determining the next steps for a potential... BLA” .
• CEO, on efficacy: “We observed a highly encouraging improvement in progression free survival... We look forward to engaging with the FDA to determine a potential path to approval” .
• CMO, on subgroup and post‑hoc: Removing prior neoadjuvant/adjuvant anti‑PD‑1 patients (n=36) yielded mPFS 24.8 vs 11.0 months (HR=0.74; nominal p=0.037) and excluding acral/mucosal (n=24) showed mPFS 22.1 vs 11.1 months .
• External KOL: “Patients treated with Cylembio... achieved the longest median PFS ever observed in a Phase 3 clinical study in advanced melanoma... PD‑L1‑negative... 16.6 months vs 3.0 months” .

Q&A Highlights

• Subgroup hierarchy and approvability: PD‑L1 status prespecified; post‑hoc removing prior anti‑PD‑1/PD‑L1 improves PFS significance (nominal); company to present totality to FDA (full population strategy) .
• OS role: Currently immature; no detriment observed; maturation expected over 6–9 months could strengthen the package .
• US vs ex‑US enrollment: 17 US patients; majority Western European/Caucasian—expected to meet FDA’s representativeness expectations .
• Competitive context: mPFS in combo appears at the high end vs historical benchmarks; tolerability profile highlighted as differentiation .

Estimates Context

• Q2 2025 S&P Global consensus EPS was -$0.30; S&P “Primary EPS” actual -$0.334*, a modest miss. Company‑reported GAAP net loss/share was $(0.40), which differs from S&P’s “Primary EPS” methodology .
• Consensus revenue was $0.0*, consistent with the company’s pre‑revenue state; the quarter’s disclosures focus on expenses, loss, and cash runway .

Values marked with * retrieved from S&P Global.

Key Takeaways for Investors

• The near‑miss on PFS significance elevates regulatory risk for full‑population approval, but the totality (strong PD‑L1–negative effect, favorable safety, OS trend) offers a credible case for an FDA path—watch for fall meeting outcomes -.
• OS maturation in the next 6–9 months is a pivotal de‑risking event; a favorable update could reshape the approvability narrative and the stock’s risk‑reward .
• Cash runway into 1Q26 post‑EIB tranche implies financing visibility through key milestones, but burn remains elevated; prepare for potential additional capital needs if timelines extend .
• Manufacturing readiness and commercial planning are highlighted, suggesting preparedness if a regulatory path emerges .
• PD‑L1–negative data could support label strategy or targeted positioning even if broader population approval is challenging—track regulatory feedback on subpopulation analyses .
• Near‑term trading setup: FDA meeting readout and any detailed Phase 3 data release are catalysts; medium‑term thesis hinges on OS maturation and regulatory alignment .

Appendix: Source Documents

• Q2 2025 8‑K 2.02 Earnings Press Release (Ex. 99.1): financials, runway, and business update -.
• Aug 11, 2025 topline Phase 3 results (8‑K and press release; slides): efficacy, safety, subgroup, regulatory plan -.
• Q1 2025 8‑K 2.02 Earnings Press Release: sequential comps and prior guidance -.
• Q3 2024 8‑K 2.02 Earnings Press Release: historical context and cash outlook -.
• Aug 10, 2025 press release (call logistics) .