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KI

KINETA, INC./DE (KA)·Q2 2023 Earnings Summary

Executive Summary

  • Q2 2023 delivered a one-time revenue-driven profit: total revenues were $5,161 (USD thousands) on the back of a $5.0M Merck milestone, producing net income of $375 and $0.04 EPS; YoY revenues rose from $833 and QoQ from $281, while EPS improved from $(1.23) YoY and $(0.77) QoQ .
  • Operationally, Kineta advanced its VISTA mAb KVA12123: seven U.S. clinical sites engaged, steady monotherapy recruitment, and Part B (pembrolizumab combo) expected to dose first patient in Q3 2023, with initial clinical data by year-end 2023 .
  • Liquidity: quarter-end cash of $7,770 with stated runway into early 2025, aided by $5M Merck milestone (July 2023) and a committed $22.5M private placement second closing expected in October 2023 (timing shifted from “July 2023” in Q1 update) .
  • Stock narrative/catalysts: initial KVA12123 clinical readout by end-2023 and commencement of the pembrolizumab combination cohort are the key near-term drivers; no numerical financial guidance was provided beyond liquidity runway .

What Went Well and What Went Wrong

  • What Went Well

    • Achieved development milestone with Merck, triggering $5.0M licensing revenue and enabling a profitable quarter (net income $375; $0.04/share) .
    • Clinical execution: “Steady progress towards achieving key scientific and business milestones… pleased with recruitment into the monotherapy cohorts… expect to share initial clinical data by the end of the year,” said CEO Shawn Iadonato .
    • Network and visibility improvements: seven U.S. sites engaged for the Phase 1/2 trial; joined the Russell Microcap Index; new independent directors added .

  • What Went Wrong

    • Elevated OpEx burden: G&A rose to $3,431 in Q2 vs $1,825 YoY (higher stock-comp and public company costs), and R&D is expected to increase as enrollment/dosing ramps .
    • Core revenue quality: Q2 revenues were primarily non-recurring milestone-based; excluding milestones, underlying revenue remains minimal for this clinical-stage profile .
    • Financing timing: the second closing of the private placement slipped from “expected in July 2023” (Q1) to “expected in October 2023” (Q2), introducing modest timing risk to liquidity milestones .

Financial Results

Metric (USD Thousands, except per share)Q2 2022Q1 2023Q2 2023
Total Revenues833 281 5,161
• Licensing Revenues609 — 5,000
• Collaboration Revenues— 281 161
• Grant Revenues224 — —
Research & Development Expense3,879 2,843 2,710
General & Administrative Expense1,825 3,924 3,431
Total Operating Expenses5,704 6,767 6,141
Loss from Operations(4,871) (6,486) (980)
Net Income (Loss)(5,878) (6,480) 375
EPS, Basic & Diluted ($)(1.23) (0.77) 0.04
Weighted Avg. Shares (000s)4,795 8,361 9,939

Liquidity and Balance Sheet

Metric (USD Thousands)Q1 2023Q2 2023
Cash9,238 7,770
Working Capital(2,391) 3,652
Total Debt754 761
Total Stockholders’ Equity(56) 7,609

KPIs and Operating Metrics

KPIQ2 2023
U.S. Clinical Trial Sites Engaged (KVA12123 Phase 1/2)7 sites
Merck Milestone Received$5.0M (development milestone)
Cash RunwayInto early 2025 (management statement)

Notes: Q2 revenue composition was predominantly the $5.0M Merck milestone recognized as licensing revenue; Q2 profitability reflects non-recurring revenue .

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Cash RunwayMulti-period“Runway through early 2025” (Q1 PR) “Runway into early 2025” (Q2 PR) Maintained
Private Placement Second Closing2023 timingCommitted $22.5M; expected July 2023 Committed $22.5M; expected October 2023 Timing delayed
KVA12123 Part B (pembro combo) – First Patient DosedQ3 2023“Dose first patient in combination arm” (timing not specified) “Dose first patient… in Q3 2023” Timeline specified
Initial Clinical Data (KVA12123)2023E“By end of 2023” “By end of 2023” Maintained

Earnings Call Themes & Trends

Note: No Q2 2023 earnings call transcript was located in our document catalog; themes below synthesize Q4’22 and Q1’23 disclosures versus Q2’23 press release .

TopicPrevious Mentions (Q4’22 and Q1’23)Current Period (Q2’23)Trend
KVA12123 Clinical ProgressIND cleared; Phase 1/2 opened; aim to report initial data by end-2023 . First patient dosed; focus on enrollment; year-end data guide reiterated .Steady monotherapy recruitment; seven U.S. sites; Part B (pembro combo) to start Q3; initial data by YE23 .Positive execution momentum
Biomarker/Scientific VisibilityPreclinical/biomarker presentations at SITC/AACR to position asset .AACR 2023 VISTA biomarker data presented; trial update .Ongoing scientific engagement
PartnershipsMerck combo-supply collaboration (KEYTRUDA) .$5M Merck development milestone achieved .Strengthened strategic validation
Capital & RunwayReverse merger closed; ATM program initiated . Q1 financing closed; runway through early 2025 .Runway into early 2025; 2nd closing of $22.5M now expected Oct-23 .Adequate but timing-sensitive
Corporate/IR PositioningManagement additions, pipeline build .Board expanded; joined Russell Microcap; new analyst coverage .Improved visibility

Management Commentary

  • “Steady progress towards achieving key scientific and business milestones continued during the second quarter, highlighted by our VISTA-targeting KVA12123 clinical program… we expect to share initial clinical data by the end of the year. In the coming months, we anticipate enrolling patients in Part B… in combination with pembrolizumab” — CEO Shawn Iadonato .
  • “The year began with an exciting start as we opened our first-in-human clinical trial of KVA12123 and dosed our first patient… report initial clinical data by the end of the year… strengthened our balance sheet with a $6 million financing to provide the company with runway through early 2025” — CEO Shawn Iadonato (Q1) .
  • FY22 context: reverse merger completion, IND clearance, and initiation of KVA12123 Phase 1/2 underpin the 2023 clinical agenda .

Q&A Highlights

  • No public Q2 2023 earnings call transcript was identified; analysis is based on the company’s press release and attached financials .

Estimates Context

  • S&P Global consensus estimates for KA were unavailable in our feed at the time of analysis; therefore, we cannot present vs-consensus comparisons. Where estimates are required, data were unavailable via S&P Global for this issuer at this time.

Key Takeaways for Investors

  • Near-term binary: initial KVA12123 clinical data by YE23 and initiation of pembrolizumab combo cohort in Q3’23 are the primary stock catalysts .
  • One-time revenue quarter: Q2 profitability was driven by a $5.0M Merck milestone; recurring revenue is not yet a driver in this clinical-stage model .
  • Operating spend mix is evolving: R&D expected to rise with enrollment/dosing, while G&A is elevated due to stock-comp and public-company costs; monitor burn trajectory vs. runway .
  • Liquidity appears sufficient into early 2025 contingent on financing execution; note timing shift of the $22.5M second closing to October 2023 .
  • Strategic validation: Merck milestone and combo study provide external validation; continued scientific visibility (AACR) supports the mechanism story .
  • Watch list: enrollment pace into Part B, initial safety/PK/early activity signals, and any updates on additional partnering or financing windows .

Sources: Q2 2023 8-K/press release and financial statements ; Q1 2023 8-K/press release and financial statements ; FY22 context press release . Additionally, Globe Newswire posting of the Q2 press release corroborates the same data .