Relay Therapeutics (RLAY -1.13%), a clinical-stage biotechnology company focused on developing precision medicines through computational drug discovery, released its second-quarter 2025 results on August 7, 2025. The key news from the period was a beat on both top and bottom lines (GAAP). The company reported GAAP earnings per share of $0.41, ahead of analyst expectations of $(0.49). GAAP revenue was $0.7 million, significantly exceeding the $0.07 million estimate. While revenue remains at a pre-commercial stage, the quarter was marked by clear progress in clinical development, tighter cost management, and a bolstered cash runway. The overall assessment of the quarter points to material advancements for the company, but with ongoing dependence on further success in clinical trials and commercial development.
| Metric | Q2 2025 | Q2 2025 Estimate | Q2 2024 | Y/Y Change |
|---|---|---|---|---|
| EPS (GAAP) | $(0.41) | $(0.49) | $(0.69) | 40.6 % |
| Revenue (GAAP) | $0.7 million | $0.07 million | $0 | N/A% |
| R&D Expenses | $63.9 million | $92.0 million | (30.6 %) | |
| G&A Expenses | $13.6 million | $20.1 million | (32.3 % decrease) | |
| Cash, Cash Equivalents and Investments (period-end) | $656.8 million | N/A |
Source: Analyst estimates for the quarter provided by FactSet.
Relay Therapeutics: Business Overview and Focus Areas
Relay Therapeutics uses a proprietary platform called Dynamo®, which combines computer simulations with experimental methods to design highly selective small-molecule drugs. Its approach aims to target protein movements within cells, enabling the creation of precise, potent therapies in fields like cancer and rare genetic diseases. The company's prominent lead drug candidate is RLY-2608, which has been developed using this platform and is designed to inhibit PI3Kα, a protein linked to cancer cell growth.
The company's recent focus has been on clinical advancement of RLY-2608 alongside streamlining its portfolio and partnerships. Key success factors include clinical trial progress, navigating regulatory requirements, keeping research and administrative costs low, and leveraging strategic collaborations to support faster drug development and commercial reach. Regulatory approvals, intellectual property, and a strong cash base are essential for seeing its pipeline through to commercialization.
Second Quarter Highlights: Clinical Progress and Financial Performance
During the quarter, Relay Therapeutics reported several notable developments. The company’s lead asset, RLY-2608, a pan-mutant selective PI3Kα inhibitor for breast cancer, continued to show consistent and positive results. Updated data presented at the American Society of Clinical Oncology (ASCO) 2025 meeting showed a median progression-free survival of 10.3 months and a 39% objective response rate among patients with PI3Kα-mutated, HR+/HER2- metastatic breast cancer. For a key subgroup of patients in second-line settings, those with kinase mutations achieved a median progression-free survival of 18.4 months, compared to 8.5 months for non-kinase mutations, based on interim clinical data presented at the 2025 ASCO Annual Meeting from the Phase 1b study of RLY-2608 plus fulvestrant. Safety remained favorable, with mostly low-grade adverse events, supporting the asset’s ongoing advancement.
A significant milestone for the period was the initiation of the Phase 3 ReDiscover-2 trial, which is evaluating RLY-2608 combined with fulvestrant (a hormonal therapy) against capivasertib plus fulvestrant for a priority patient group. Additional studies are exploring "triplet" combinations that add other cancer medicines, aiming to cover more potential treatment paths in advanced breast cancer. Elsewhere in the pipeline, development continued in areas like vascular malformations and programs for NRAS-driven solid tumors and Fabry disease, underscoring the breadth of Relay's research efforts.
On the financial side, the company posted a marked reduction in both research and development (R&D) and general and administrative (G&A) expenses compared to the prior year. R&D expenses were down 30.5%, or $28.1 million, year over year on a GAAP basis, mainly due to streamlining business operations and out-licensing expenses for the drug lirafugratinib following a licensing agreement with Elevar Therapeutics. G&A expenses also declined by $6.5 million, or 32.3%, compared to the second quarter of 2024, mostly because of reduced stock compensation and lower employee costs. These efforts contributed to a lower net loss for the quarter compared to one year ago.
The company's cash, cash equivalents, and investments totaled $656.8 million as of June 30, 2025, down from $710.4 million as of March 31, 2025, and $781.3 million as of December 31, 2024, but Management projects this amount is sufficient to fund operations and planned capital expenses into 2029, based on cash, cash equivalents, and investments as of June 30, 2025. No new licensing or partnership agreements were announced during the period, so the company remains focused on internal pipeline execution.
Looking Ahead: Guidance and What to Watch
Relay Therapeutics did not provide specific financial guidance for revenue or earnings in the upcoming quarters. Management underlined that its top priority is enrolling patients and executing the pivotal Phase 3 clinical trial for RLY-2608, with the goal of eventually bringing a new therapy to market for breast cancer patients with high unmet needs. The cash runway, projected to last into 2029 based on cash, cash equivalents, and investments as of Q2 2025, is intended to support this development strategy, even as revenue remains minimal in the near term.
Investors should watch for further clinical trial updates, signs of progress in pipeline diversification, and any new partnership or commercial announcements. With revenue still negligible and development heavily focused on its lead candidate, execution of the late-stage clinical trials will remain in sharp focus for stakeholders monitoring the company’s outlook. RLAY does not currently pay a dividend.
Revenue and net income presented using U.S. generally accepted accounting principles (GAAP) unless otherwise noted.
