Alector 2025 Q3 Earnings Beats Revenue Estimates with 17.9% Net Loss Reduction

Alector (ALEC) reported third-quarter 2025 earnings on November 6, 2025, with results showing improved financial metrics despite a revenue decline. The company exceeded revenue estimates and narrowed its net loss by 17.9% year-over-year. Management provided 2025 guidance, including collaboration revenue of $13–$18 million and R&D expenses of $130–$140 million, aligning with cost-cutting measures.

Revenue

Total revenue for Q3 2025 fell to $3.26 million, a 78.8% decline from $15.34 million in Q3 2024. The drop was driven by the completion of performance obligations related to the AL002 program and the latozinemab FTD-C9orf72 Phase 2 trial. Despite the year-over-year decline, the $3.26 million figure surpassed analyst estimates of $3.02 million.

Earnings/Net Income

Alector reduced its per-share loss to $0.34 in Q3 2025 from $0.43 in Q3 2024, reflecting a 20.9% improvement. The net loss narrowed to $34.67 million, down from $42.22 million, as cost-saving initiatives, including a 47% workforce reduction, curtailed expenses. While the improvement is positive, the company remains unprofitable, having posted losses for eight consecutive years in the corresponding quarter.

Post-Earnings Price Action Review

The strategy of buying Alector shares on the earnings announcement date and holding for 30 days yielded a cumulative return of 11.78%, with a maximum drawdown of 12.58%. Post-earnings momentum drove a 20.59% surge in the first 30 days, though a 14.07% pullback occurred in the subsequent period. This pattern highlights the stock’s volatility and the influence of broader market dynamics.

CEO Commentary

CEO Arnon Rosenthal emphasized progress on the Alector Brain Carrier (ABC) platform, with AL137 and AL050 advancing toward IND-enabling studies in 2026 and 2027. Preclinical data supported low-dose peripheral administration for these candidates, and the CEO reiterated confidence in ABC’s ability to optimize safety and efficacy. A 47% workforce reduction was announced to extend the $291.1 million cash runway through 2027.

Guidance

Alector projected collaboration revenue of $13–$18 million for 2025, R&D expenses of $130–$140 million, and G&A expenses of $55–$65 million. The company expects IND submissions for AL137 (2026) and AL050 (2027), with an interim analysis for the PROGRESS-AD trial of nivisnebart (AL101) planned for 1H 2026.

Additional News

1. Workforce Reduction: Alector implemented a 47% workforce reduction to extend its cash runway through 2027.

2. Late-Stage Trial Setback: The Phase 3 INFRONT-3 trial for latozinemab did not show clinical benefit, leading to the discontinuation of related studies.

3. ABC Platform Focus: The company emphasized its Alector Brain Carrier (ABC) technology, targeting neurodegenerative disease therapies with programs like AL137 and AL050.