Recursion Pharmaceuticals RXRX reported a loss of 50 cents per share in the first quarter of 2025, wider than the Zacks Consensus Estimate of a loss of 44 cents. The company had incurred a loss of 39 cents per share in the year-ago quarter.

In the absence of an approved product, Recursion Pharmaceuticals only recognizes collaboration and grant revenues from its partners. Total revenues in the reported quarter amounted to $14.7 million, up 7% year over year, primarily driven by the timing of projects from RXRX’s Sanofi, Roche and Merck KGaA, Darmstadt, Germany collaborations. The reported figure, however, missed the Zacks Consensus Estimate of $20 million. (Stay up-to-date with all quarterly releases: See Zacks Earnings Calendar.)

Shares of Recursion Pharmaceuticals plunged 16.6% yesterday, likely because the investors were disappointed by the weaker-than-expected first-quarter results.

RXRX’s Q1 Results in Detail

In the first quarter of 2024, Research and development (R&D) expenses soared 92% to $129.6 million compared with the $67.6 million reported in the year-ago period. The massive uptick in R&D expenses can be attributed to Recursion Pharmaceuticals’ agreement with Tempus for upgrading its therapeutic development platform, as well as its business combination with Exscientia in November 2024.

General and administrative (G&A) expenses were $54.7 million in the reported quarter, up 74% year over year, due to the inclusion of G&A expenses from the business combination with Exscientia. Additionally, RXRX’s cost of revenues in the reported quarter increased 95% year over year to $21.8 million.

The company had cash, cash equivalents and restricted cash worth $509 million as of March 31, 2025, compared to $603 million as of Dec. 31, 2024. Recursion Pharmaceuticals expects its existing cash, cash equivalents and restricted cash to fuel operations into mid-2027 based on its current business plan.

The stock has plunged 29.7% year to date compared with the industry’s decline of 0.4%.Zacks Investment Research

Image Source: Zacks Investment Research

RXRX’s Key Pipeline Updates

Recursion Pharmaceuticals announced that it has discontinued the development of its lead candidate, REC-994, for treating symptomatic cerebral cavernous malformation, as well as the development of REC-2282 for the neurofibromatosis type II indication, following unfavorable efficacy results from separate mid-stage studies of these candidates. The decision was taken as part of the company’s strategic pipeline reprioritization efforts.

Story Continues

RXRX has also discontinued the mid-stage study developing REC-3964 for treating clostridioides difficile infection to focus on other areas with greater unmet need. The company is currently looking to out-license the development rights to REC-3964. These pipeline setbacks have also likely disappointed the investors, further contributing to the stock price decline.

Following this decision, Recursion Pharmaceuticals has shifted its focus and resources to the development of other candidates in its clinical pipeline. Such candidates include REC-4881, which is being developed for familial adenomatous polyposis in a phase Ib/II TUPELO study. The company recently reported preliminary data from this study.

In the phase II open-label portion of the TUPELO study, REC-4881 showed a preliminary median 43% reduction in polyp burden by week 13. Five out of six patients, treated in phase II, saw decreases in polyp burden ranging from 31% to 82%, though one patient experienced a notable increase. Additionally, 50% of patients improved by at least one point in Spigelman stage, indicating reduced upper gastrointestinal disease severity. The early safety profile was generally in line with other MEK1/2 inhibitors, with most side effects being mild to moderate. Additional data from the TUPELO study is expected in the second half of 2025.

Recursion Pharmaceuticals is also evaluating REC-1245, a new chemical entity for the treatment of biomarker-enriched solid tumors and lymphoma, in the phase I/II DAHLIA study. Data readout from the phase I portion of the DAHLIA study is expected in the first half of 2026. Other candidates in early-stage development include REC-617 (advanced solid tumors) and REC-3565 (B-cell malignancies) in separate early-stage studies.

Recursion Pharmaceuticals, Inc. Price, Consensus and EPS SurpriseRecursion Pharmaceuticals, Inc. Price, Consensus and EPS Surprise

Recursion Pharmaceuticals, Inc. price-consensus-eps-surprise-chart | Recursion Pharmaceuticals, Inc. Quote

RXRX’s Zacks Rank & Other Stocks to Consider

Recursion Pharmaceuticals currently carries a Zacks Rank #2 (Buy).

Some other top-ranked stocks in the biotech sector are Bayer BAYRY, ADMA Biologics Inc. ADMA and Beam Therapeutics Inc. BEAM, each carrying a Zacks Rank #2 at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

In the past 60 days, estimates for Bayer’s earnings per share have increased from $1.14 to $1.22 for 2025. During the same time, earnings per share have increased from $1.23 to $1.31 for 2026. Year to date, shares of Bayer have gained 40.4%.

BAYRY’s earnings matched estimates in two of the trailing three quarters while missing the same on the remaining occasion, the average negative surprise being 19.61%.

In the past 60 days, estimates for ADMA Biologics’ earnings per share have increased from 69 cents to 71 cents for 2025. During the same time, earnings per share estimates for 2026 have increased from 87 cents to 93 cents. Year to date, shares of ADMA have rallied 38.3%.

ADMA’s earnings beat estimates in three of the trailing four quarters while missing the same on the remaining occasion, the average surprise being 32.80%.

In the past 60 days, estimates for Beam Therapeutics' loss per share have narrowed from $4.45 to $4.27 for 2025. During the same time, loss per share estimates for 2026 have narrowed from $4.94 to $4.80. Year to date, shares of BEAM have lost 20.1%.

BEAM’s earnings beat estimates in three of the trailing four quarters while missing the same on the remaining occasion, the average surprise being 3.92%.

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

Bayer Aktiengesellschaft (BAYRY):Free Stock Analysis Report

Beam Therapeutics Inc. (BEAM):Free Stock Analysis Report

ADMA Biologics Inc (ADMA):Free Stock Analysis Report

Recursion Pharmaceuticals, Inc. (RXRX):Free Stock Analysis Report

This article originally published on Zacks Investment Research (zacks.com).

Zacks Investment Research

View Comments