Zentalis Pharmaceuticals, Inc. (ZNTL)·Q4 2024 Earnings Summary

Executive Summary

• Zentalis’ Q4 2024 print featured an unexpected licensing/IP revenue contribution and a narrower loss per share versus consensus; management also extended cash runway and outlined a registrational path for azenosertib, setting up 2025–2026 catalysts .
• EPS beat: Q4 2024 EPS of $(0.614) vs $(0.689) consensus; Revenue surprise: $26.9M vs $0.0 consensus (driven by licensing/IP) — both from S&P Global; narrative supported by full-year disclosure of $67.4M “Revenues from licensing and sales of IP” * (estimates from S&P Global).
• Strategic resets de-risked funding: restructuring and portfolio focus extend cash runway into late 2027, beyond the planned DENALI Part 2 topline (YE 2026) .
• Stock catalysts: initiation of DENALI Part 2 (1H 2025), Fast Track designation in Cyclin E1+ PROC, and multiple monotherapy data sets (ORR ~31–35%, mDOR ~4–6 months) reinforce the registrational thesis heading into 2026 .

What Went Well and What Went Wrong

What Went Well

• Clear registrational path: FDA-aligned DENALI Part 2 design with seamless Parts 2a/2b; enrollment start planned 1H 2025; topline by YE 2026, potentially supporting accelerated approval .
• Compelling monotherapy signal in Cyclin E1+ PROC: DENALI Part 1b ORR 34.9% (response-evaluable n=43), mDOR ~5.5–6.3 months; consistent activity across MAMMOTH and ZN‑c3‑001 .
• Funding runway: Cash, cash equivalents and marketable securities of $371.1M at 12/31/24; restructuring extends runway into late 2027, beyond the DENALI Part 2 topline .

“Zentalis reported significant progress in the development of azenosertib in 2024… With a sharpened focus on clinical development, and strong cash position into late 2027, Zentalis is well-positioned to execute on our objectives…” — CEO Julie Eastland .

What Went Wrong

• Clinical hold overhang (resolved path, but timing friction): Q2 2024 disclosed an FDA partial clinical hold after two deaths in DENALI; Company deferred data timelines pending resolution (ultimately shifted to 2025 plans) .
• Operating intensity: FY24 G&A rose to $87.1M (from $64.4M), primarily personnel costs (incl. non-cash SBC); offset by lower R&D and total opex YoY .
• Portfolio narrowing: Company discontinued ZN‑d5 AML program and paused certain combinations (e.g., niraparib combo not advancing due to exposures), increasing single-asset dependency on azenosertib .

Financial Results

Quarterly performance (trend and estimates)

Notes:

• Q2 2024 revenue was $0; Q4 revenue was driven by licensing/IP (company reported $67.4M of licensing/IP revenue for FY24) .
• Asterisk denotes values retrieved from S&P Global.

Liquidity

Full-year operating expenses

Key Clinical KPIs

Guidance Changes

Earnings Call Themes & Trends

Note: No Q4 2024 earnings call transcript found in our database; management provided detailed updates via March 26, 2025 earnings press release and the Jan 29, 2025 corporate event .

Management Commentary

• “We plan to maintain strong execution on the late-stage development of azenosertib… with the goal of bringing azenosertib to patients as quickly as possible.” — Julie Eastland, CEO .
• “In a patient population with a clear unmet medical need, the monotherapy data showed a meaningful and consistent improvement in responses… the results demonstrate a median duration of response of approximately 5.5 months…” — Ingmar Bruns, M.D., CMO .
• On restructuring: extended runway into late 2027 to support late-stage development and DENALI Part 2 topline .

Q&A Highlights

• No Q4 2024 earnings call transcript available; however, the Jan 29, 2025 corporate event clarified: alignment with FDA on DENALI Part 2 design; initiation planned 1H 2025; topline by YE 2026; and focus on Cyclin E1+ PROC monotherapy path (potential for accelerated approval, subject to FDA) .
• Management emphasized safety profile consistency at clinically active monotherapy doses and discontinued combinations where efficacious exposures weren’t achieved (niraparib) .

Estimates Context

Drivers: revenue recognition from licensing/IP drove the top-line surprise; EPS benefited from higher revenue and operating discipline; full-year “Revenues from licensing and sales of IP” totaled $67.4M, corroborating non-recurring top-line drivers .
Note: Consensus/actuals sourced from S&P Global.

Key Takeaways for Investors

• Registration trajectory de-risking: FDA-aligned design, Fast Track, and defined topline timing (YE 2026) position azenosertib for a potential accelerated approval filing if Part 2 succeeds .
• Clinical signal is consistent across studies in Cyclin E1+ PROC (ORR ~31–35%, mDOR ~4–6 months), supporting the biomarker-enriched monotherapy strategy .
• Funding runway now extends into late 2027, providing a multi-year window to execute pivotal activities with reduced 2025 opex post-restructuring .
• Q4 revenue/EPS beats were largely non-recurring (licensing/IP) rather than product-driven; model 2025 top-line conservatively and focus on opex cadence and trial milestones .
• Near-term trading catalysts: DENALI Part 2 initiation (1H 2025), any interim operational updates, and additional monotherapy dataset disclosures; medium-term: DENALI Part 2 topline by YE 2026 .
• Risk lens: single-asset concentration, prior safety events (now reflected in design/monitoring), and dependency on biomarker-defined population; offset by regulatory alignment and safety characterization to date .

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Supporting documents read in full:

• 8‑K 2.02 (Mar 26, 2025) with FY24 results and Exhibit 99.1 press release .
• Press releases on FY24 results, Fast Track designation, restructuring, clinical data update, and leadership changes .

Asterisk denotes values retrieved from S&P Global.