Avidity (RNA) Q2 Revenue Jumps 88%

Avidity Biosciences (RNA -4.12%), a biotechnology firm developing RNA-targeted therapeutics for rare muscle diseases, reported its second-quarter 2025 results on August 7, 2025. The period featured sharply higher revenue (GAAP) at $3.8 million, well above the $1.49 million average analyst estimate (GAAP), mainly from ongoing collaboration payments. At the same time, expenses (GAAP) jumped, with an earnings per share loss of $(1.21) (GAAP), coming in below expectations for $(0.96) GAAP EPS. The company reported an expanded net loss (GAAP) of $157.3 million as it accelerated late-stage research and increased commercial infrastructure. The quarter showcased both clear clinical progress and a heavy investment phase, positioning the company for several potential drug submissions over the next 18 months.

Source: Analyst estimates for the quarter provided by FactSet.

Business Overview and Focus Areas

Avidity Biosciences works on creating novel medicines for rare neuromuscular diseases using its antibody oligonucleotide conjugate (AOC) platform. This technology joins antibodies—proteins that can target very specific cells—with RNA-targeted medicines, enabling delivery into muscle tissue. Success for the business depends on advancing its three core clinical programs through trials: del-desiran for myotonic dystrophy type 1, del-brax for facioscapulohumeral muscular dystrophy, and del-zota for Duchenne muscular dystrophy with exon 44 mutations.

The company's recent focus has been on moving these leading drug candidates closer to approval, securing special regulatory designations that can speed review, and establishing a global commercial infrastructure. Its results reflect a heavy research and development period, with significant investments in trial execution, regulatory applications, and early commercial buildout. The outcome of major clinical trials—especially those approaching pivotal readouts—remains central to its potential success.

Second Quarter Highlights and Performance Drivers

Collaboration revenue (GAAP) rose to $3.8 million from $2.0 million in the prior year. This performance primarily stemmed from progress on its multi-year partnership with Bristol Myers Squibb. Despite this revenue boost, Avidity remains in a pre-commercialization phase, and its sales depend on milestone-driven collaborations, not product sales.

Total operating expenses saw a substantial increase, as Research and development expenses (GAAP) reached $138.1 million, more than double the amount a year earlier. Management stated this rise is “primarily driven by the advancement” of the three lead drug candidates and by research staff build-out. General and administrative expenses (GAAP) grew 78% compared to the same period of 2024 as the company invested in organizing for potential launches and hiring key personnel.

Financially, Avidity reported a net loss (GAAP) of $157.3 million. This compares to a GAAP net loss of $70.8 million in Q2 2024. While this widening loss looks steep, it reflects the dual pressure of increased clinical trial activity and a scaled-up commercial presence. The company raised $185.5 million in additional cash through an at-the-market stock offering. With $1.18 billion in cash, Avidity projects its runway will fund operations well into mid-2027, which is expected to cover pivotal trial outcomes and possible commercial launches.

On the product side, the company advanced all three of its main RNA-based drug candidates. Del-zota (an experimental medicine for a subset of Duchenne muscular dystrophy) received Breakthrough Therapy designation from the U.S. Food and Drug Administration, meaning the program may get faster review and development support. Its Biologics License Application (BLA)—the formal submission for U.S. marketing approval—is now targeted for the end of 2025. Del-desiran’s pivotal Phase 3 HARBOR trial finished enrollment, setting it up for a major clinical readout in 2026; regulatory submissions are planned in the U.S. Europe, and Japan in the second half of 2026. Del-brax moved forward with positive early-stage trial data, new alignment with the FDA for fast-track and full approval pathways, and initiated confirmatory global trials. These programs are all centered on using AOC technology for muscle disease, and the next year is expected to be packed with data releases and regulatory milestones.

Outside core programs, strategic partnerships with larger firms continued delivering collaboration revenue, but there were no new partnership deals or major disclosed milestones this quarter. Intellectual property protection remains a stated focus, as does expanding applications of the AOC technology, but patent wins or litigation were not a feature of this period’s news.

Looking Ahead and Management Outlook

Management emphasized that its strong cash reserves should fund the company through mid-2027, giving it time to achieve several potential product approvals and launches. The first commercial product could reach the market in the U.S. in 2026, if ongoing trials and regulatory processes stay on track. Several high-impact clinical readouts and regulatory decisions are due between late 2025 and the end of 2026—including up to three different Biologics License Application (BLA) filings from the core pipeline, with the first planned BLA submission at year-end 2025 and additional submissions anticipated in the second half of 2026.

The company did not provide formal financial guidance for the upcoming quarter or year, reflecting its stage as a development biotech with unpredictable milestone revenues. Investors should monitor clinical progress, the pace of regulatory submissions, and operational cash usage in the quarters ahead.

Revenue and net income presented using U.S. generally accepted accounting principles (GAAP) unless otherwise noted.