Executive Summary

Pre-revenue, clinical-stage quarter with net loss of $6.74M and diluted EPS of $(0.22); operating expenses rose YoY on R&D and G&A scaling for Phase 3 and public-company readiness .
Cash and equivalents reached $117.38M at quarter-end, bolstered by IPO net proceeds of ~$70.6M, providing substantial runway for pivotal studies and manufacturing build-out .
Clinical execution advanced: EU Phase 3 Xilonix in metastatic colorectal cancer on track for Q3 2015 enrollment completion; blinded aggregate data showed encouraging responder metrics in lean body mass and symptom improvement; first patient in 514G3 MRSA study showed rapid improvement within 24 hours .
No financial guidance; program milestones updated (EU Phase 3 top-line late 2015/early 2016; global Phase 3 interim data late 2016; new manufacturing operations in Q2 2016), which are potential stock catalysts as data readouts and regulatory timelines materialize .

What Went Well and What Went Wrong

What Went Well

Phase 3 EU colorectal cancer study progressed with 220 patients enrolled; blinded aggregates showed 62% DEXA responders (avg LBM +2.1±2.8kg) and 60% EORTC responders; RECIST evaluable patients included 2 PR and 23 SD—positive signals against patient-recovery endpoints aligned with EMA’s guidance .
Infectious disease program momentum: FDA lifted clinical hold on Phase 1/2 S. aureus study; first MRSA bacteremia patient showed significant improvement within 24 hours of therapy, with Phase 1/2 results expected Q1 2016 .
Strengthened balance sheet: IPO closed with ~$76M gross and ~$70.6M net proceeds; cash of $117.38M supports clinical and manufacturing scale-up, reducing financing overhang risk .

What Went Wrong

Continued losses as expected for a pre-commercial biotech: net loss widened YoY to $6.74M from $3.91M, with R&D up 35% to $4.38M and G&A up 209% to $2.04M, reflecting staff growth, bonus payments, and investor relations/legal expenses after going public .
Clinical trials increased cash burn: operating cash outflows of $15.39M in H1 driven by European trial activity and manufacturing development costs, intensifying focus on disciplined spend until pivotal data and potential EMA submission .
No revenue and no non-GAAP offsets; margins not meaningful without sales, limiting near-term financial levers and keeping the story purely clinical/regulatory .

Financial Results

Metric	Q2 2014	Q1 2015	Q2 2015
Revenue ($USD Millions)	$0.00	$0.00	$0.00
Net Loss ($USD Millions)	$(3.91)	$(8.11)	$(6.74)
Diluted EPS ($USD)	$(0.16)	$(0.29)	$(0.22)
R&D Expense ($USD Millions)	$3.25	$6.78	$4.38
G&A Expense ($USD Millions)	$0.66	$1.42	$2.04

Liquidity	Q1 2015	Q2 2015
Cash & Equivalents ($USD Millions)	$52.24	$117.38
Operating Cash Flow ($USD Millions, YTD)	$(6.53)	$(15.39)

Notes:

Company reported no revenue; margins (gross/EBITDA/operating) are not applicable in the absence of sales .
Share count used for diluted EPS: 31.29M in Q2 2015 vs. 23.75M in Q2 2014; 27.64M in Q1 2015 .

Segment breakdown: Not applicable; XBiotech manages as one operating segment .

KPIs (Clinical Program)

KPI	Current Period (Q2 2015)
EU Phase 3 (CRC) Patients Enrolled	220
DEXA Responders (LBM gain)	61 of 98 (62%), avg +2.1±2.8 kg
EORTC Responders	59 of 98 (60%)
RECIST Evaluable	93 (2 PR, 23 SD)
MRSA Phase 1/2 First-Patient Response	Significant recovery within 24 hours

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
EU Phase 3 CRC Enrollment Completion	Q3 2015	Not previously provided	Complete enrollment in Q3 2015	Introduced
EU Phase 3 Top-line Data	Late 2015 / Early 2016	Not previously provided	Top-line late 2015 or early 2016	Introduced
514G3 (S. aureus) Phase 1/2 Results	Q1 2016	Not previously provided	Results expected Q1 2016	Introduced
Global Phase 3 Xilonix Interim Data	Late 2016	Not previously provided	Interim data late 2016	Introduced
Manufacturing Facility Operations	Q2 2016	Not previously provided	Begin operations Q2 2016	Introduced
EMA Submission Possibility	By year-end 2015 (dependent on EU study outcome)	Not previously provided	Potential EMA submission by YE 2015	Introduced

No financial guidance provided (revenue, margins, OpEx, tax, dividends): N/A .

Earnings Call Themes & Trends

Topic	Previous Mentions (Q-2: Q4 2014)	Previous Mentions (Q-1: Q1 2015)	Current Period (Q2 2015)	Trend
R&D execution (EU CRC Phase 3)	N/A	Clinical trial costs up; European activities driving spend	Enrollment at 220; positive blinded responder metrics; DSMB continuation; on schedule	Strengthening execution
Regulatory/legal	N/A	IND on clinical hold for S. aureus pending tox; awaiting FDA response	FDA lifted hold; Phase 1/2 launched; first patient treated	Positive inflection
Manufacturing scale-up	N/A	New facility construction initiated; capex increasing	Infrastructure installed; targeting operations Q2 2016; validation July 2016	Advancing to readiness
Finance/capital	N/A	Pre-IPO cash $52.24M; deferred offering costs	IPO net ~$70.6M; cash $117.38M	Runway extended
Pipeline breadth	N/A	Multiple indications under evaluation; preclinical advancing	Acne, T2D publications; lung/vascular exploration; emphasis on True Human platform	Broadening visibility

Note: No transcript available; webcast archived for 90 days as per 8-K, limiting Q&A analysis .

Management Commentary

“XBiotech has made remarkable advancements across our lead oncology and infectious disease programs.” — John Simard, CEO .
“We reported summary data…based on enrollment of 220 colorectal cancer patients…encouraged by…increase in lean body mass, and reductions in pain, fatigue and appetite loss…” — John Simard .
“The observation of recovery in advanced cancer patients treated with Xilonix…is tremendously insightful…a definite positive force for creating new and better therapies that keep the well being of cancer patients in mind.” — John Simard .
“Very encouraging results for the first patient dosed…MRSA bacteremia within 24 hours…[pivotal trial] planned for 2016.” — John Simard .
“We are now nearing completion on a new manufacturing facility…capable of producing several hundred thousand doses annually…begin operations in 2016.” — John Simard .

Q&A Highlights

The company hosted its inaugural quarterly business update call on July 28, 2015, with webcast archived for 90 days; a full transcript was not found, so Q&A specifics and any guidance clarifications are unavailable .

Estimates Context

Wall Street consensus for Q2 2015 EPS and revenue via S&P Global was unavailable in our query window; no external estimates were cited by the company, and XBiotech reported no revenue for the quarter .

Key Takeaways for Investors

Pre-revenue profile with accelerating clinical execution; EU Phase 3 CRC blinded data and near-term enrollment completion present a catalyst path toward top-line and potential EMA submission by year-end 2015 .
Strong liquidity post-IPO ($117.38M cash), supporting multiple pivotal programs and manufacturing readiness without immediate financing needs .
Infectious disease program de-risked regulatory pathway (FDA hold lifted) plus an encouraging first-patient signal in MRSA; Phase 1/2 results in Q1 2016 are a tangible upcoming event .
Operating expenses will remain elevated as trials expand and public company infrastructure matures; monitor burn trajectory versus clinical milestones (H1 operating cash outflow $15.39M) .
The narrative centers on EMA’s patient-recovery endpoints and True Human platform differentiation; positive readouts could shift valuation framework from binary to multi-asset optionality .
Absence of financial guidance and sell-side estimates in this period places emphasis on execution milestones; traders should watch EU Phase 3 completion, top-line timing, and MRSA data for directional moves .
No non-GAAP adjustments disclosed; comparisons should rely on GAAP loss and cash runway until commercialization or partnership revenues emerge .

XBiotech Inc. (XBIT)·Q2 2015 Earnings Summary