What changed in this filing

/stocks — the workspaceLOADING

Item 1. Financial Statements

2025-11-12 compared with 2025-08-11 · 91 added, 58 removed, 312 unchanged (32% of the section changed)

3 unchanged sentences

CONDENSED CONSOLIDATED BALANCE SHEETS

September 30,

(in thousands, except par value information)

20 unchanged sentences

60,000 shares authorized;

outstanding shares were 27,148 at June 30, 2025 and 27,096 at December 31, 2024

outstanding shares were 27,235 at September 30, 2025 and 27,096 at December 31, 2024

Additional paid-in capital

7 unchanged sentences

Three Months Ended

Six Months Ended

Nine Months Ended

September 30,

(in thousands, except per share data)

27 unchanged sentences

Issuance of common stock upon exercise of stock options

Balance at June 30, 2025

Balance – June 30, 2025

Share-based compensation expense

Issuance of common stock upon exercise of stock options

Issuance of common stock under equity plans

Balance – September 30, 2025

Stockholders’

6 unchanged sentences

Issuance of common stock upon exercise of stock options

Balance at June 30, 2024

Balance – June 30, 2024

Share-based compensation expense

Issuance of common stock upon exercise of stock options

Issuance of common stock under equity plans

Balance – September 30, 2024

The accompanying notes are an integral part of these condensed consolidated financial statements.

2 unchanged sentences

CONDENSED CONSOLIDATED STATEM ENTS OF CASH FLOWS

Six Months Ended June 30,

Nine Months Ended September 30,

(in thousands)

18 unchanged sentences

Proceeds from exercise of stock options

Proceeds from the issuance of common stock under equity plans

Proceeds from debt

4 unchanged sentences

Cash, cash equivalents and restricted cash at end of the period

Six Months Ended June 30,

Nine Months Ended September 30,

Non-cash investing activities

1 unchanged sentence

Right-of-use assets acquired through operating leases

Purchase of property and equipment in accounts payable

The accompanying notes are an integral part of these condensed consolidated financial statements.

27 unchanged sentences

The Company is currently evaluating the impact that adoption of ASU 2024-03 will have on the financial statement disclosures.

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740) - Improvements to Income Tax Disclosures.

The new standard requires a company to expand its existing income tax disclosures, specifically related to the rate reconciliation and income taxes paid.

The standard is effective for the Company beginning in fiscal year 2025, with early adoption permitted.

The Company does not expect to early adopt the new standard.

The new standard is expected to be applied prospectively, but retrospective application is permitted.

The Company is currently evaluating the impact of ASU 2023-09 on the financial statements and related disclosures.

The Company has entered into license agreements and collaborative research and development arrangements with pharmaceutical and biotechnology companies, as well as consulting, related technology transfer, product revenue and government grant agreements.

5 unchanged sentences

The Company cannot guarantee the achievement of these milestones due to risks associated with preclinical and clinical activities required for development of nucleic acid medicine-based therapeutics and vaccines.

The following table presents changes during the six months ended June 30, 2025 in the balances of contract assets and liabilities as compared to what was disclosed in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024.

The following table presents changes during the nine months ended September 30, 2025 in the balances of contract assets and liabilities as compared to what was disclosed in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024.

(in thousands)

December 31, 2024

June 30, 2025

September 30, 2025

Contract Assets:

4 unchanged sentences

For the Three Months

Ended June 30,

For the Six Months

Ended June 30,

Ended September 30,

For the Nine Months

Ended September 30,

(in thousands)

3 unchanged sentences

Grant revenue:

Gates Foundation

Total grant revenue

5 unchanged sentences

In September 2024, our COVID-19 vaccine KOSTAIVE ® became the world’s first approved and commercially available self-amplifying RNA (sa-mRNA) vaccine.

The Company received a $ 200.0 million upfront payment and is eligible to receive over $ 1.3 billion in development milestones if all products are registered in the licensed fields and is entitled to potentially receive up to $ 3.0 billion in commercial milestones based on “net sale” of vaccines in the various fields.

In addition, the Company is eligible to receive a 40 % net profit share for COVID-19 vaccine pro ducts and up to low double-digit royalties for vaccines for pandemic preparedness and against seasonal influenza as well as three other infectious disease pathogens.

During the second quarter of 2025, the Company achieved $ 20.0 million in development milestones related to the CSL Collaboration Agreement, of which $ 10.0 million was included in accounts receivable as of June 30, 2025.

During the third quarter of 2025, the Company invoiced $ 4.1 million in upfront payments related to the CSL Collaboration Agreement.

All amounts were included in accounts receivable as of September 30, 2025.

In evaluating the CSL Collaboration Agreement in accordance with ASC 606, the Company concluded that CSL Seqirus is a customer.

2 unchanged sentences

For each performance obligation, the Company estimated the standalone selling price based on 1) in the case of the license, the fair value using costs to recreate plus margin method and 2) in the case of research and development services and regulatory activities, cost plus margin for estimated full-time equivalent (“FTE”) costs, direct costs including laboratory supplies, contractors, and other out-of-pocket expenses for research and development services and regulatory activities.

As of June 30, 2025, the transaction price consisted of upfront consideration received and milestones achieved.

Additional variable consideration was not included in the transaction price as of June 30, 2025, because the Company could not conclude that it is probable that including the variable consideration will not result in a significant revenue reversal.

As of September 30, 2025, the transaction price consisted of upfront consideration received and milestones achieved.

Additional variable consideration was not included in the transaction price as of September 30, 2025, because the Company could not conclude that it is probable that including the variable consideration will not result in a significant revenue reversal.

The Company allocated the transaction price to the performance obligations in proportion to their standalone selling price.

2 unchanged sentences

Any consideration related to sales-based royalties will be recognized when the amounts are probable of non-reversal, provided that the reported sales are reliably measurable and the Company has no remaining promised goods/services, as they are constrained and therefore have also been excluded from the transaction price.

The revenue recognized in the second quarter of 2025 relates to the license delivered, milestones achieved and services performed through June 30, 2025.

Total deferred revenue as of June 30, 2025 and December 31, 2024 for the CSL Collaboration Agreement was $ 18.1 million and $ 30.7 million, respectively.

The revenue recognized in the third quarter of 2025 relates to the license delivered, milestones achieved and services performed through September 30, 2025.

Total deferred revenue as of September 30, 2025 and December 31, 2024 for the CSL Collaboration Agreement was $ 8.7 million and $ 30.7 million, respectively.

During 2023, the Company entered into an amendment to the CSL Collaboration Agreement, pursuant to which the Company agreed to sponsor and conduct a Phase 1 clinical study in the influenza field.

3 unchanged sentences

Therefore, the Company concluded the promise to sponsor and conduct the Phase 1 clinical study is a separate contract and the sole performance obligation under the new arrangement.

During the quarter ended June 30, 2025 , the Company recognized $ 1.1 million related to the performance obligation and the remaining amount of $ 1.3 million is included in deferred revenue.

During the quarter ended September 30, 2025 , the Company recognized $ 1.4 million related to the performance obligation, which was fully satisfied during the period.

During the fourth quarter of 2023, the Company received an advance payment of $ 5.3 million from CSL Seqirus for manufacturing activities related to COVID-19 vaccine product.

11 unchanged sentences

The costs associated with these reimbursements are reflected as a component of research and development expense in the Company’s condensed consolidated statements of operations and comprehensive loss.

As of June 30, 2025, the remaining available funding net of revenue e arned was $ 32.2 million.

As of September 30, 2025, the remaining available funding net of revenue e arned was $ 30.3 million.

Gates Foundation

During the three months ended September 30, 2025 , the Company recognized $ 1.1 million of grant revenue related to cost reimbursement under two grants awarded by the Gates Foundation.

The grants support development of (i) a therapeutic HPV vaccine candidate and (ii) durability assessments of self-amplifying mRNA COVID-19 vaccine platforms.

Grant funding is conditional upon achievement of defined milestones and submission of periodic progress and financial reports.

Revenue is recognized as qualifying costs, including employee FTE labor and related expenses, are incurred in accordance with the terms of each agreement.

Unspent or uncommitted amounts remain deferred until the associated performance obligations are satisfied.

As of September 30, 2025 , deferred grant revenue related to these agreements totaled $ 2.3 million.

Fair Value Measurements

6 unchanged sentences

The carrying value of cash, restricted cash, accounts receivable, accounts payable and accrued liabilities approximate their respective fair values due to their relatively short maturities.

As of June 30, 2025 and December 31, 2024 , all assets measured at fair value on a recurring basis consisted of cash equivalents and money market funds, which were classified within Level 1 of the fair value hierarchy.

As of September 30, 2025 and December 31, 2024 , all assets measured at fair value on a recurring basis consisted of cash equivalents and money market funds, which were classified within Level 1 of the fair value hierarchy.

The fair value of these financial instruments was measured based on quoted prices.

2 unchanged sentences

(in thousands)

June 30, 2025

September 30, 2025

December 31, 2024

5 unchanged sentences

Property and equipment, net

Depreciation and amortization expense was $ 0.8 million and $ 1.6 million for the three and six months ended June 30, 2025 , respectively, and $ 0.9 million and $ 1.8 million for the three and six months ended June 30, 2024, respectively.

Depreciation and amortization expense was $ 0.8 million and $ 2.3 million for the three and nine months ended September 30, 2025 , respectively, and $ 0.9 million and $ 2.7 million for the three and nine months ended September 30, 2024 , respectively.

During the three months ended September 30, 2025, the Company disposed of certain fully depreciated assets with no cash proceeds.

Accrued liabilities consisted of the following:

(in thousands)

June 30, 2025

September 30, 2025

December 31, 2024

6 unchanged sentences

Other accrued research and development expenses

The following table provides a reconciliation of cash and cash equivalents and restricted cash reported within the unaudited condensed consolidated balance sheets that sum to the total of the same such amounts shown in the unaudited condensed consolidated statement of cash flows as of June 30, 2025 and 2024:

(in thousands)

June 30, 2025

June 30, 2024

September 30, 2025

September 30, 2024

Cash and cash equivalents

3 unchanged sentences

Restricted cash includes collateral pledged and held in the Company’s securities accounts pursuant to a security agreement with Wells Fargo Bank, National Association (“Wells Fargo”) (Note 5).

As of June 30, 2025 , such collateral amounted to $ 55.0 million.

As of September 30, 2025 , such collateral amounted to $ 55.0 million.

Restricted cash also includes cash required to be set aside as security for lease payments and to maintain a letter of credit for the benefit of the landlord of the Company’s offices.

As of June 30, 2025 and 2024 , the Company had restricted cash of $ 1.9 million in conjunction with property leases in San Diego, California, and such restriction is expected to be removed at the end of the lease term.

As of September 30, 2025 and 2024 , the Company had restricted cash of $ 1.9 million in conjunction with property leases in San Diego, California, and such restriction is expected to be removed at the end of the lease term.

Wells Fargo Credit Agreement

The Company’s wholly-owned subsidiary, Arcturus Therapeutics, Inc.

(“Arcturus Therapeutics”) entered into a credit agreement with Wells Fargo Bank on April 21, 2023, and amended on June 26, 2024 , whereby Wells Fargo will make a $ 50.0 million revolving credit line available to the Company (the “Loan”) and each draw on the Loan evidenced by a revolving line of credit note (the “Note”).

(“Arcturus Therapeutics”) entered into a credit agreement with Wells Fargo Bank on April 21, 2023, and amended on June 26, 2024 , whereby Wells Fargo will make a $ 50.0 million

revolving credit line available to the Company (the “Loan”) and each draw on the Loan evidenced by a revolving line of credit note (the “Note”).

Borrowings under the agreement will bear interest at a rate of 1.00 % above either the Daily Simple SOFR or Term SOFR (as such terms are defined in the Note), with “SOFR” being the rate per annum equal to the secured overnight financing rate as administered by the Federal Reserve Bank of New York.

3 unchanged sentences

As collateral, the Company has agreed to pledge $ 55.0 million in cash to be held in the Company’s securities accounts with Wells Fargo Securities, LLC, an affiliate of Wells Fargo, pursuant to a security agreement.

In June 2024, Arcturus Therapeutics and Wells Fargo entered into an amendment to the Note,

whereby the term of the Note was extended by one year to April 2026.

No amounts were drawn down under the Loan during the three months period ended June 30, 2025.

In June 2024, Arcturus Therapeutics and Wells Fargo entered into an amendment to the Note, whereby the term of the Note was extended by one year to April 2026.

No amounts were drawn down under the Loan during the three months ended September 30, 2025.

Stockholders’ Equity

Net Loss per Share

Potentially dilutive securities that were not included in the calculation of diluted net loss per share as they were anti-dilutive totaled 0.3 million and 0.4 million for three and six months ended June 30, 2025, respectively, and 1.1 million and 1.3 million for the three and six months ended June 30, 2024, respectively.

Potentially dilutive securities that were not included in the calculation of diluted net loss per share as they were anti-dilutive totaled 0.5 million and 0.4 million for three and nine months ended September 30, 2025, respectively, and 0.7 million and 1.1 million for the three and nine months ended September 30, 2024, respectively.

Sales Agreement

3 unchanged sentences

In accordance with the terms of the Sales Agreement, the Company may offer and sell shares of its common stock having an aggregate offering price of up to $ 200 million from time to time through Cantor, Wells Fargo Securities, or William Blair, each acting as the Company's sales agent.

During the three and six months ended June 30, 2025 the Company did no t offer or sell any shares of common stock pursuant to the Sales Agreement.

During the three and nine months ended September 30, 2025 the Company did no t offer or sell any shares of common stock pursuant to the Sales Agreement.

Share-Based Compensation Expense

In June 2024 at the Company’s 2024 Annual Meeting of Stockholders (the "2024 Annual Meeting"), the stockholders of the Company appro ved an amendment to the Company’s 2019 Omnibus Equity Incentive Plan (as amended, the “2019 Plan”) which, among other things, increased the aggregate number of shares authorized for use in making awards to eligible persons under the 2019 Plan by 2,000,000 shares, for a total of up to 10,750,000 shares available for issuance.

As of June 30, 2025 , a total of 1,397,536 shares remain available for future issuance under the 2019 Plan, subject to the terms of the 2019 Plan.

As of September 30, 2025 , a total of 1,586,213 shares remain available for future issuance under the 2019 Plan, subject to the terms of the 2019 Plan.

In October 2021, the Company adopted the 2021 Inducement Equity Incentive Plan which covers the award of up to 1,000,000 shares of common stock (the “2021 Plan”) effective as of October 15, 2021.

1 unchanged sentence

In April 2022, the compensation committee of the Company’s board of directors approved a proposal to reduce the total number of shares available for future issuance under the 2021 Plan to 130,000 .

As of June 30, 2025, a tota l of 135,898 s hares remain available for future issuance under the 2021 Plan, subject to the terms of the 2021 Plan.

Pursuant to the terms of the plan, shares underlying awards that are forfeited, cancelled, or terminated without issuance are returned to the share reserve.

As of September 30, 2025 , a total of 151,215 shares remain availabl e for future issuance under the 2021 Plan, subject to the terms of the 2021 Plan.

Share-Based Compensation

Share-based compensation expense included in the Company’s condensed consolidated statements of operations and comprehensive loss for the three and six months ended June 30, 2025 and 2024 was as follows:

Share-based compensation expense included in the Company’s condensed consolidated statements of operations and comprehensive loss for the three and nine months ended September 30, 2025 and 2024 was as follows:

For the Three Months

Ended June 30,

For the Six Months

Ended June 30,

Ended September 30,

For the Nine Months

Ended September 30,

(in thousands)

4 unchanged sentences

The primary difference between the effective tax rate and the federal statutory rate is due to federal and state income tax expense offset by valuation allowance on the Company's deferred tax assets.

The Company recorded negligible income tax expense for the three and six months ended June 30, 2025 .

For the same periods in 2024, the Company recognized an income tax benefit of $ 0.2 million and income tax expense of $ 0.2 million, respectively.

The Company recorded negligible income tax expense for the three and nine months ended September 30, 2025 .

For the three months ended September 30, 2024, the Company recorded $ 0.2 million of income tax benefit and for the nine months ended September 30, 2024, the Company recorded no income tax benefit.

No tax benefit was provided for losses incurred in the United States because those losses are offset by a full valuation allowance.

3 unchanged sentences

Some of the provisions of the new tax law affecting corporations include but are not limited to current deduction of domestic research expenses, increasing the limit of the deduction of interest expense deduction to thirty percent of EBITDA, and one hundred percent bonus depreciation on eligible property acquired after January 19, 2025.

The Company is currently evaluating the impact the new tax law will have on its financial condition and results of operations.

Preliminarily, the Company does anticipate a change to its effective income tax rate, its net deferred federal income tax Liability and a decrease in current taxes payable;

however a reasonable estimate is not available at this time.

The impact of the tax law changes from the OBBBA will be included in the Company’s financial statements beginning in the three-months ending September 30, 2025.

The impact of the tax law changes from the OBBBA was included in the Company’s financial statements beginning in the three-months ending September 30, 2025.

Commitments and Contingencies

2 unchanged sentences

Pursuant to the amendment, (i) CFF increased the amount it will award to advance LUNAR-CF to $ 24.6 million from approximately $ 15.6 million, and (ii) the Company agreed to incur at least $ 15.0 million toward activities under the research plan.

During the fourth quarter of 2023, the Company received the full payment from CFF related to the amendment.

Total contra expense recognized was $ 0.3 million and $ 0.7 million for the three and six months ended June 30, 2025, respectively, and $ 0.8 million for both the three and six months ended June 30, 2024.

As of June 30, 2025 and December 31, 2024, $ 6.8 million and $ 7.4 million, respectively, remained in accrued liabilities.

During the fourth quarter of 2023, the Company received the full payment from CFF related to the amendme nt.

Total contra expense recognized was $ 0.2 million and $ 0.9 million for the three and nine months ended September 30, 2025 , respectively.

A total expense of $ 0.3 million and a total contra expense of $ 0.5 million were recognized during the three and nine months ended September 30, 2024, respectively.

As of September 30, 2025 and December 31, 2024 , $ 6.6 million and $ 7.4 million, respectively, remained in accrued liabilities.

In October 2017, the Company entered into a non-cancellable operating lease agreement for office space adjacent to its previously occupied headquarters.

14 unchanged sentences

When the lease term was determined for the operating lease right-of-use assets and lease liabilities, the extension option for the lease was not included.

The lease has a monthly base rent ranging from $ 0.3 million to $ 0.4 million which escalates over the lease term.

The lease has a monthly base rent ranging from $ 0.3 million

to $ 0.4 million which escalates over the lease term.

The Company received a free rent period of four months and also pays for various operating costs, including utilities and real property taxes.

4 unchanged sentences

The Company uses its incremental borrowing rate to calculate the present value of the lease payments, as the implicit rate in the lease is not readily determinable.

As of June 30, 2025, the remaining payments of the operating lease liability were as follows:

As of September 30, 2025, the remaining payments of the operating lease liability were as follows:

(in thousands)

7 unchanged sentences

Operating lease costs consist of the fixed lease payments included in operating lease liability and are recorded on a straight-line basis over the lease terms.

Operating lease costs were $ 1.3 million and $ 2.5 million for the three and six months ended June 30, 2025 , respectively, and $ 1.5 million and $ 2.9 million for the three and six months ended June 30, 2024 , respectively.

Operating lease costs were $ 1.3 million and $ 3.8 million for the three and nine months ended September 30, 2025 , respectively, and $ 1.3 million and $ 4.1 million for the three and nine months ended September 30, 2024 , respectively.

Segment Information

1 unchanged sentence

The determination of a single business segment is consistent with the consolidated financial information regularly provided to the Company’s chief operating decision maker (“CODM”).

The Company’s CODM is its Chief Executive Officer, who reviews and evaluates consolidated net loss for purposes of assessing performance, making operating decisions, allocating resources, and planning and forecasting for future periods.

The Company’s CODM is its Chief Executive Officer, who reviews and evaluates consolidated net loss for purposes of assessing performance, making operating

decisions, allocating resources, and planning and forecasting for future periods.

The CODM does not evaluate the operating segment using asset or liability information.

1 unchanged sentence

For the Three Months

Ended June 30,

For the Six Months Ended June 30,

Ended September 30,

For the Nine Months Ended September 30,

(in thousands)

13 unchanged sentences

with Axcelead, Inc.

The Company’s share of the investees’ results is presented as either income or loss from equity-method investees in the accompanying

consolidated statements of operations and comprehensive loss.

As of June 30, 2025, the carrying value of the equity-method investment in ARCALIS remained at zero .

The Company’s share of the investees’ results is presented as either income or loss from equity-method investees in the accompanying consolidated statements of operations and comprehensive loss.

As of September 30, 2025, the carrying value of the equity-method investment in ARCALIS remained at zero .

Subsequent Events

Change of Corporate Headquarters

On November 6, 2025, the Company changed its corporate headquarters from 10628 Science Center Drive, Suite 250 San Diego, California 92121, to 10285 Science Center Drive, San Diego, California 92121 (the “Address Change”) in order to order to consolidate administrative operations into a single facility.

There was no material impact on the Company’s operations, financial position, or results of operations as a result of the Address Change.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements