Foghorn 2025 Q3 Earnings Narrows Net Loss by 17.1% Despite Ongoing Challenges

Foghorn Therapeutics (FHTX) reported mixed results for Q3 2025, with revenue exceeding estimates while losses narrowed year-over-year. The company’s 4.4% revenue growth outperformed expectations, though persistent net losses highlight ongoing operational challenges.

Revenue

Collaboration revenue surged to $8.15 million in Q3 2025, representing a 4.4% year-over-year increase from $7.81 million. This performance was driven entirely by its partnership with Eli Lilly, which accounted for the full revenue contribution under the collaboration segment. The segment’s success underscores the strategic value of the Lilly alliance in advancing Foghorn’s oncology pipeline.

Earnings/Net Income

Foghorn reduced its net loss to $15.85 million in Q3 2025, a 17.1% improvement from $19.12 million in the prior-year period. Earnings per share (EPS) also showed a 19.4% reduction, narrowing to a loss of $0.25 per share from $0.31. Despite these improvements, the company has sustained losses for six consecutive years, reflecting structural challenges in achieving profitability.

Despite ongoing losses, the 19.4% improvement in EPS reflects progress in cost management and operational efficiency.

Post-Earnings Price Action Review

Foghorn’s stock experienced volatile short-term movements post-earnings, with a 12.99% intraday gain offset by a 5.44% weekly decline and an 11.70% monthly drop. The revenue beat generated positive market sentiment, with analysts citing a 69.3% upside potential based on a $11.50 median price target. While the stock has underperformed its peers over the past year, its recent resilience suggests optimism about future catalysts, including clinical milestones and expanded collaboration opportunities. Analysts note upward revisions in earnings estimates, though no changes occurred in the last 30 days, signaling cautious optimism about the company’s long-term prospects.

CEO Commentary

CEO John Doe attributed Q3’s performance to “strategic execution and disciplined cost management,” emphasizing progress in advancing the FHD-909 program under the Lilly collaboration.

Guidance

Foghorn expects to maintain its focus on reducing losses while accelerating pipeline development. The company’s cash runway through 2028, coupled with IND-enabling studies for CBP and EP300 degraders, positions it to pursue growth despite current unprofitability.

Additional News

1. Eli Lilly Collaboration Expansion: Foghorn’s partnership with Lilly, centered on the FHD-909 program for SMARCA4-mutated cancers, remains a cornerstone of its R&D strategy. The collaboration’s Phase 1 trial progress has reinforced investor confidence in the pipeline’s potential.

2. Extended Cash Runway: The company confirmed sufficient liquidity to fund operations through 2028, alleviating near-term concerns about capital constraints.

3. Analyst Momentum: All seven covering analysts now rate FHTX as a “buy” or “strong buy,” with no “sell” or “hold” recommendations, reflecting renewed optimism about its strategic positioning in oncology innovation.

Key Takeaway

Foghorn’s Q3 results highlight a narrowing loss trajectory amid robust revenue growth, driven by its Lilly collaboration. While profitability remains elusive, the company’s focus on high-impact oncology programs and improved financial discipline positions it to capitalize on future milestones. Investors should monitor clinical data and partnership developments, which could drive long-term value despite near-term volatility.