Arcus Biosciences — Third Quarter 2026 Earnings Summary

Financial Performance:

• Total revenues were $9 million for the third quarter of 2026, a decrease from $26 million in the same period of 2025.
• Revenue decline was primarily driven by lower revenues from the Gilead Collaboration as activities wind down or reach completion, partially offset by increased revenues from the Taiho Collaboration Agreement.
• Research and development (R&D) expenses were $117 million for the third quarter of 2026, down from $141 million in the third quarter of 2025.
• General and administrative (G&A) expenses were $23 million for the third quarter of 2026, down from $27 million in the third quarter of 2025.
• Net loss was $128 million for the third quarter of 2026, compared to $135 million in the same period of 2025.
• Cash, cash equivalents, and marketable securities totaled $694 million as of September 30, 2026, compared to $1.01 billion as of December 31, 2025.
• Non-cash stock-based compensation expense was $9 million for R&D and $7 million for G&A in the third quarter of 2026, compared to $7 million for R&D and $7 million for G&A in the third quarter of 2025.
• Gross reimbursements for shared expenses from collaborations were $12 million in the third quarter of 2026, down from $28 million in the same period of 2025.
• For the nine months ended September 30, 2026, total revenues were $67 million, and net loss was $347 million.

Guidance and Future Outlook:

• Arcus expects to recognize GAAP revenue of between $70 million and $75 million for the full year 2026.
• The company projects its cash position, including $288 million in gross proceeds from an October equity financing, will fund operations into 2029.
• R&D expenses are expected to remain relatively consistent in the near term, as increased investment in casdatifan and immunology programs offsets decreases in other programs.
• Enrollment in the Phase 3 PEAK-1 study (casdatifan plus cabozantinib in second-line) is expected to complete within the next two to three months.
• The Phase 3 PEAK-20 study (casdatifan plus ipilimumab and nivolumab in first-line) is on track to initiate by year-end 2026.
• Multiple additional data readouts, including mature progression-free survival (PFS) and overall survival (OS) data from ARC-20 cohorts, are expected in 2027.
• An interim analysis for the Phase 3 PRISM-1 trial (quemliclustat in pancreatic cancer) is scheduled for the fourth quarter of 2026.
• New cohorts for casdatifan combinations with ivonescimab, pumitamig, and tivunatamig are expected to begin prior to the end of 2026.
• A new cohort evaluating casdatifan with anti-PD-1 and axitinib is expected to initiate in the first half of 2027 to support the PEAK-21 Phase 3 study.
• A randomized ARC-20 cohort evaluating casdatifan plus tivozanib versus tivozanib alone in late-line patients is expected to initiate in the fourth quarter of 2026.

Business Segments and Product Lines:

• Casdatifan (HIF-2α inhibitor):
  • First-line ccRCC: Casdatifan plus zimberelimab demonstrated a 6-month PFS of 86% and 12-month PFS of 69%, with a 50% confirmed objective response rate (cORR).
  • First-line ccRCC: Casdatifan plus ipilimumab plus zimberelimab showed a 4% primary progression rate among 24 patients with scans.
  • Second-line ccRCC: Casdatifan plus cabozantinib achieved a median PFS of 14.5 months and median OS not reached; TKI-pretreated patients (approx. 60% of the cohort) had a median PFS of 16.5 months.
  • Late-line ccRCC: Casdatifan monotherapy demonstrated a median OS of 35 months, median PFS of 13 months, and cORR of 36% in 121 patients.
  • Safety data across all cohorts were consistent with prior studies, with no unexpected safety signals observed.
• Quemliclustat (CD73 inhibitor):
  • The Phase 3 PRISM-1 trial is fully enrolled, evaluating quemliclustat plus gemcitabine/nab-paclitaxel versus gemcitabine/nab-paclitaxel in first-line metastatic pancreatic ductal adenocarcinoma.
• Immunology Portfolio:
  • AB102 (oral MRGPRX2 antagonist): Initiated a first-in-human healthy volunteer study in August 2026.
  • TNF inhibitor (oral, TNFR1-selective), CCR6 antagonist (oral), and CD89 monoclonal antibody: Development candidates are progressing through preclinical development with potential to enter the clinic in 2027.
  • STAT6 inhibitor and CD40L inhibitor programs: Expected to deliver IND-ready candidates in 2027.

Market and Competitive Landscape:

• Casdatifan results in first-line ccRCC exceeded third-party benchmarks for pembrolizumab monotherapy and ipilimumab plus nivolumab.
• Casdatifan plus cabozantinib results in second-line ccRCC substantially exceeded benchmarks for cabozantinib monotherapy.
• Late-line casdatifan monotherapy showed improvements across key efficacy measures relative to data from benchmark studies with a first-generation HIF-2α inhibitor.
• Subgroup data from the LITESPARK-011 study highlighted an unmet need in patients previously treated with an immunotherapy plus TKI combination, reinforcing the opportunity for casdatifan plus cabozantinib.

Risks and Challenges:

• Risks include the ability to manage the breadth and pace of development plans for casdatifan.
• Potential for unexpected adverse events or undesirable side effects with investigational molecules.
• Difficulties or delays in initiating, enrolling, and completing clinical trials due to regulatory review, site activation, patient identification, or manufacturing constraints.
• Interim data may not guarantee future results or be replicated in Phase 3 studies.
• Adverse data from toxicology studies could affect the advancement of immunology programs.
• Risk that preclinical profiles may not translate in clinical trials.
• Changes in the competitive landscape for Arcus's programs.
• Inherent uncertainty associated with pharmaceutical product development.
• Risk of inaccurate financial forecasting or changes in operating plans.

Management Commentary and Tone:

• CEO Terry Rosen, Ph.D., stated that robust and durable HIF-2α inhibition from casdatifan addresses patient needs across every line of kidney cancer therapy, citing nearly three years of median overall survival in late-line patients.
• Management expressed confidence in building registrational evidence to make casdatifan the backbone of treatment for clear cell renal cell carcinoma.
• The company described itself as "extremely well-positioned" to develop casdatifan across all lines of therapy due to its cash runway.
• R&D expense reductions were attributed to winding down domvanalimab studies and streamlining initiatives, while noting that increased investment in casdatifan and immunology programs will offset these decreases.

Other Key Points:

• Arcus completed an equity financing in October 2026, generating $288 million in gross proceeds.
• The company is developing casdatifan as a TKI-sparing therapy in the first-line setting and consecutive regimens in second- and late-line settings.
• The PEAK-21 Phase 3 study evaluating casdatifan plus anti-PD-1 and axitinib in first-line ccRCC is planned for initiation following the new cohort in the first half of 2027.
• The company has advanced two oncology programs to Phase 3 clinical trials: casdatifan for clear cell renal cell carcinoma and quemliclustat for pancreatic cancer.
• Total assets were $818 million as of September 30, 2026, compared to $1.139 billion as of December 31, 2025.
• Total stockholders' equity was $358 million as of September 30, 2026, compared to $631 million as of December 31, 2025.