NYSE$RCUS

Arcus Biosciences Inc · Q2 2023 earnings

Q2 2023 earnings · · Investor relations

Briefing

Arcus Biosciences reported financial results for the second quarter ended June 30, 2023, and provided a pipeline update.

Arcus Biosciences reported revenues of $29 million for the second quarter of 2023, compared to $27 million for the same period in 2022. Cash, cash equivalents and marketable securities were $1.0 billion as of June 30, 2023. Net loss was $75 million for the quarter.

  • Presented data from the ongoing ARC-7 Phase 2 trial in non-small cell lung cancer at ASCO, demonstrating clinically meaningful improvements over anti-PD-1 monotherapy with domvanalimab.
  • Initiated the dose-expansion phase of the Phase 1b ARC-20 study of AB521 in clear-cell renal cell carcinoma patients.
  • Conducted an analysis of data from the Phase 1/1b ARC-8 study of quemliclustat, with encouraging overall survival data relative to historical benchmarks for chemotherapy alone.
  • Based on data from ARC-6, the etrumadenant-based combination is not expected to demonstrate sufficient clinical benefit in castrate resistant prostate cancer.

Headline financials

Total Revenue

$29M

Previous: $26.8M+8.4%
EPS (adj)

-$1.04

Previous: -$0.93-11.8%
Capital Expenditures

-$8M

Previous: -$4.3M-86.0%
Free Cash Flow

-$83M

Previous: -$70.9M-17.0%
Net Income

-$75M

Previous: -$66.6M-12.6%
Operating Income

-$83M

Previous: -$69M-20.3%
Gross Profit

$0.00

Previous: $0.00
Cash & Equivalents

$1B

Previous: $1.27B-21.3%
Total Assets

$1.22B

No prior period
Stock-Based Comp

$18M

No prior period

Revenue & EPS history

Arcus Biosciences · Revenue · Quarterly

$29M

Q2 2023+8.4%vs Q2 2022
Beat estimate in 12 of 15 quarters(80%)
ActualEstimate

Revenue by segment

Arcus Biosciences · $10M total across 1 segment · Q2 2023

  • Other collaboration
    $10M

Forward guidance

Arcus expects to present several key datasets across its pipeline, including data from the Phase 2 EDGE-Gastric study (ARC-21), overall survival data from ARC-8, and data from the Phase 1b ARC-20 study for AB521.

Tailwinds

  • Initial ORR data from the ongoing EDGE-Gastric (ARC-21) Phase 2 study of domvanalimab plus zimberelimab and chemotherapy in first-line upper GI cancers are anticipated in the fourth quarter of 2023.
  • A Phase 2 study evaluating AB521 in combination with other agents is anticipated to begin in the fourth quarter of 2023.
  • Arcus expects to initiate a Phase 1 study in healthy volunteers of AB801, its potent and highly selective Axl inhibitor, in the third quarter of 2023.
  • Initial pharmacokinetic (PK), pharmacodynamic (PD) and safety data, along with any preliminary signs of anti-tumor activity from the dose-escalation phase of ARC-20, are expected in late 2023 or early 2024.
  • Data from ARC-9, a Phase 1b/2 study evaluating etrumadenant plus zimberelimab plus chemotherapy in second-line and third-line metastatic colorectal cancer (mCRC), which is fully enrolled, are expected in the first half of 2024.

Headwinds

  • Based on our most recent analysis of data from ARC-6, the etrumadenant-based combination is not expected to demonstrate sufficient clinical benefit in castrate resistant prostate cancer to warrant further investment.
  • The trial will continue to completion, further development of etrumadenant in mCRPC has been deprioritized.
  • Data from ARC-9 are expected in the first half of 2024, due to a slower-than-anticipated event rate.
  • Arcus now expects cash utilization between $290 million and $325 million for the year ended December 31, 2023.
  • Net Loss was $75 million for the second quarter 2023, compared to $67 million for the same period in 2022.

Historical earnings impact

How earnings announcements have historically affected this stock's price.

Avg. return before/after earnings

Based on 20 quarterly earnings reports · overlaid with Q2 2023

Historical avgQ2 2023

+2.4%

Avg return

Earnings day

+3.6%

Avg return

5 days after

+6.7%

Avg return

30 days after

59%

19 / 32 earnings

Positive

+19.2%

Q4 2021

Best reaction

-7.9%

Q1 2021

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q1 2026+0.0%-2.6%-5.6%
Q4 2025-4.0%+10.7%+0.0%
Q3 2025-1.1%+2.7%+28.9%
Q1 2025-1.2%+8.4%+22.8%
Q4 2024-1.0%-7.3%-18.4%
Q3 2024+7.7%+16.1%+13.1%
Q2 2024+11.5%+11.7%+12.3%
Q1 2024+3.8%+10.6%-0.4%
Q4 2023+18.5%+18.4%-1.0%
Q3 2023+2.8%-13.0%+0.4%
Q2 2023-3.0%-4.3%+18.3%
Q1 2023-5.2%-6.9%+9.0%
Q4 2022-4.0%+0.6%-3.7%
Q3 2022-2.2%-7.9%+43.2%
Q2 2022+6.0%+7.9%-2.1%
Q1 2022+11.9%-9.7%+10.1%
Q4 2021+19.2%+24.6%+20.4%
Q3 2021+11.4%+9.1%+26.5%
Q2 2021-7.3%-2.5%+13.7%
Q1 2021-7.9%-11.7%-23.4%
Q4 2020+2.9%+10.3%-1.7%
Q3 2020-7.1%+3.8%+33.1%
Q2 2020+2.3%+8.1%-1.1%
Q1 2020-0.7%+11.4%+11.3%
Q4 2019+7.1%-2.6%-19.8%
Q3 2019+1.6%-6.3%-3.2%
Q2 2019+1.8%+10.3%+18.2%
Q1 2019+4.9%+9.1%-15.5%
Q4 2018-6.8%+11.6%-3.7%
Q3 2018+8.9%-1.1%+8.0%
Q2 2018+2.2%+7.5%+19.0%
Q1 2018+2.9%-1.1%+6.9%
Q4 2017
Q3 2017
Q2 2017
Q1 2017

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