Foghorn 2025 Q2 Earnings Narrows Losses Despite Revenue Growth

Foghorn (FHTX) reported stronger-than-expected revenue growth in Q2 2025, though the company continued to post a net loss, reflecting ongoing operational challenges. The company did not issue new guidance but maintained its projected cash runway into 2028.

Revenue

Total revenue for Foghorn increased to $7.56 million in Q2 2025, a 9.7% increase from the same quarter in 2024. The company reported collaboration revenue of $7.56 million, which accounted for all of its total revenue during the period. This reflects continued progress in its strategic partnerships, particularly under its ongoing collaboration with Lilly.

Earnings/Net Income

Foghorn reported a loss of $0.28 per share for Q2 2025, a 37.8% improvement compared to a loss of $0.45 per share in Q2 2024. The net loss also narrowed to $17.94 million, a 21.9% reduction from $22.98 million in the prior year. Despite the improvement, the company has recorded losses for six consecutive years during this quarter, signaling continued financial strain.

The narrowing of the loss per share indicates some efficiency in cost management or operational improvements, but the persistent net losses suggest that the company is still investing heavily in R&D and business development, as is typical for a clinical-stage biotech.

Price Action

Foghorn’s stock price experienced mixed performance in the short term, declining 2.20% in the latest trading day and 10.09% over the most recent full trading week. However, it posted a modest 2.51% gain month-to-date, showing some resilience despite the broader downward pressure.

Post-Earnings Price Action Review

The investment strategy of buying Foghorn shares following its Q2 revenue growth and holding for 30 days underperformed significantly, yielding a return of -63.04% and underperforming the benchmark by 111.62%. This strategy exhibited a Sharpe ratio of -0.29 and a maximum drawdown of 0.00%, signaling high risk and poor risk-adjusted returns. These results highlight the market’s skepticism around the company’s ability to convert financial improvements into long-term stock performance.

CEO Commentary

Adrian Gottschalk, President and CEO of Foghorn, emphasized the company’s progress in its drug development pipeline, particularly in oncology. He highlighted the strong enrollment in the FHD-909 dose escalation trial and the promising preclinical synergy observed with pembrolizumab and KRAS inhibitors. Gottschalk also noted advancements in the selective degrader programs targeting CBP, EP300, and ARID1B, with an IND for the CBP degrader expected in 2026. He expressed confidence in the company’s strong balance sheet, which supports ongoing research and development through 2028.

Guidance

Foghorn expects to remain on track with its FHD-909 Phase 1 trial in SMARCA4-mutated cancers and anticipates updates on its Selective EP300 and ARID1B degrader programs in Q4 2025. The company also expects to remain on its projected cash runway into 2028, supporting continued development of its pipeline and collaboration efforts.

Additional News

In early May 2025, Foghorn announced the appointment of two new members to its Board of Directors: Neil Gallagher, M.D., Ph.D., and Stuart Duty. Dr. Gallagher brings extensive experience in drug development across multiple therapeutic areas, including oncology, while Mr. Duty has a long background in finance and investment banking in biotechnology. These additions are expected to strengthen the board’s strategic and operational oversight. In April 2025, Foghorn presented new preclinical data at the AACR Annual Meeting, showcasing advancements in its FHD-909, Selective CBP, and Selective EP300 degrader programs. Additionally, the company hosted its second annual Chromatin Regulation Summit in May 2025, featuring discussions on targeted protein degradation and induced proximity technologies for disease treatment.