Tempest's Q2 Net Loss Widens to $20.5M Amid R&D Spend

TL;DR

**Tempest is burning cash faster, but recent capital raises offer a lifeline for its high-risk, high-reward drug pipeline.**

AI Summary

Tempest Therapeutics, Inc. reported no revenue for the three and six months ended June 30, 2025, consistent with its clinical-stage status. The company's net loss for the three months ended June 30, 2025, was $20.5 million, a 13.9% increase from the $18.0 million net loss for the same period in 2024. For the six months ended June 30, 2025, the net loss was $40.5 million, up 12.8% from $35.9 million in the prior year. Research and development expenses increased to $16.9 million for Q2 2025 from $14.9 million in Q2 2024, reflecting ongoing clinical trial activities. General and administrative expenses also rose to $3.6 million in Q2 2025 from $3.1 million in Q2 2024. The company raised $10.0 million in gross proceeds through a registered direct offering of common stock on June 11, 2025, and an additional $1.0 million through its At-The-Market (ATM) program during Q2 2025. As of June 30, 2025, Tempest had $100.0 million in cash and cash equivalents, a decrease from $120.0 million at December 31, 2024, indicating a burn rate of approximately $20.0 million over six months. The strategic outlook remains focused on advancing its clinical pipeline, particularly TPST-1120 and TPST-1495, with funding secured through recent offerings.

Why It Matters

Tempest Therapeutics' widening net loss and increased R&D expenses highlight the significant capital requirements of clinical-stage biotechs. For investors, the company's ability to raise $11.0 million through equity offerings in Q2 2025 is crucial for funding its pipeline, but also signals potential dilution. Employees and customers are directly impacted by the progress of drug candidates like TPST-1120, which could offer new treatments if successful. In a competitive oncology market, sustained funding and positive clinical trial results are paramount for Tempest to differentiate itself and achieve market relevance.

Risk Assessment

Risk Level: high — The company reported a net loss of $20.5 million for Q2 2025 and has no revenue, indicating a complete reliance on external financing. Its cash and cash equivalents decreased by $20.0 million from $120.0 million at December 31, 2024, to $100.0 million at June 30, 2025, demonstrating a significant cash burn. The success of its drug candidates, like TPST-1120, is uncertain and critical for future viability.

Analyst Insight

Investors should monitor Tempest's clinical trial progress for TPST-1120 and TPST-1495 closely, as positive data could significantly impact valuation. Given the high cash burn and lack of revenue, consider the potential for further dilution from future equity offerings before making an investment decision.

Financial Highlights

debt To Equity

N/A

revenue

$0

operating Margin

N/A

total Assets

N/A

total Debt

N/A

net Income

-$20.5M

eps

N/A

gross Margin

N/A

cash Position

$100.0M

revenue Growth

N/A

Revenue Breakdown

Key Numbers

• $20.5M — Q2 2025 Net Loss (Increased by 13.9% from $18.0M in Q2 2024, indicating higher operational costs.)
• $16.9M — Q2 2025 R&D Expenses (Up from $14.9M in Q2 2024, reflecting increased investment in clinical trials.)
• $10.0M — Registered Direct Offering Proceeds (Capital raised on June 11, 2025, to fund operations and pipeline development.)
• $1.0M — ATM Program Proceeds (Additional capital raised during Q2 2025 through the At-The-Market program.)
• $100.0M — Cash and Cash Equivalents (As of June 30, 2025, a decrease from $120.0M at December 31, 2024, showing cash burn.)

Key Players & Entities

• Tempest Therapeutics, Inc. (company) — filer of the 10-Q
• $20.5 million (dollar_amount) — net loss for Q2 2025
• $18.0 million (dollar_amount) — net loss for Q2 2024
• $40.5 million (dollar_amount) — net loss for six months ended June 30, 2025
• $35.9 million (dollar_amount) — net loss for six months ended June 30, 2024
• $16.9 million (dollar_amount) — R&D expenses for Q2 2025
• $14.9 million (dollar_amount) — R&D expenses for Q2 2024
• $10.0 million (dollar_amount) — gross proceeds from registered direct offering on June 11, 2025
• $1.0 million (dollar_amount) — proceeds from At-The-Market (ATM) program during Q2 2025
• $100.0 million (dollar_amount) — cash and cash equivalents as of June 30, 2025

FAQ

Risk Factors

• Significant Net Losses and Cash Burn [high — financial]: The company reported net losses of $20.5 million for Q2 2025 and $40.5 million for the first six months of 2025. With $100.0 million in cash as of June 30, 2025, and a burn rate of approximately $20.0 million over six months, the company's ability to continue operations is dependent on future financing.
• Clinical Trial Execution and Drug Development [high — operational]: Tempest's success hinges on the successful development and regulatory approval of its drug candidates, TPST-1120 and TPST-1495. Delays, adverse trial results, or failure to achieve efficacy endpoints could significantly impact the company's future.
• Regulatory Approval Pathway [medium — regulatory]: Navigating the complex and evolving regulatory landscape for drug approval is a significant risk. Failure to meet FDA or other global regulatory requirements could prevent commercialization.
• Competition in Oncology Market [medium — market]: The oncology market is highly competitive, with numerous companies developing novel therapies. Tempest faces competition from both established pharmaceutical companies and emerging biotechs, which could impact market share and pricing.
• Reliance on Capital Markets [medium — financial]: The company has raised capital through a registered direct offering ($10.0 million) and an ATM program ($1.0 million) in Q2 2025. Continued reliance on equity financings exposes the company to market volatility and potential dilution for existing shareholders.

Industry Context

Tempest Therapeutics operates in the highly competitive biopharmaceutical sector, specifically focusing on oncology. The industry is characterized by long development cycles, significant R&D investment, and stringent regulatory hurdles. Companies like Tempest are driven by innovation in novel therapeutic approaches, aiming to address unmet medical needs in cancer treatment.

Regulatory Implications

As a clinical-stage biopharmaceutical company, Tempest is subject to rigorous oversight by regulatory bodies such as the FDA. The success of its drug candidates, TPST-1120 and TPST-1495, is contingent upon meeting strict clinical trial protocols and demonstrating safety and efficacy to gain regulatory approval.

What Investors Should Do

1. Monitor R&D Spend and Clinical Trial Progress
2. Assess Cash Runway and Future Financing Needs
3. Evaluate Competitive Landscape and Market Potential

Key Dates

• 2025-06-11: Registered Direct Offering — Raised $10.0 million in gross proceeds, providing crucial funding for ongoing clinical trials and operations.
• 2025-06-30: End of Q2 2025 — Reporting period for the 10-Q, showing $100.0 million in cash and cash equivalents and increased net loss.
• 2025-01-01 to 2025-06-30: First Six Months of 2025 — Accumulated a net loss of $40.5 million, with R&D expenses of $16.9 million for Q2 2025.
• 2024-06-30: End of Q2 2024 — Comparative period for Q2 2025 results, showing a net loss of $18.0 million and R&D expenses of $14.9 million.

Glossary

Clinical-stage

A company that is in the process of testing drug candidates in human clinical trials but has not yet received regulatory approval for marketing. (Explains why Tempest Therapeutics has no revenue and incurs significant R&D expenses.)

Net Loss

The total expenses of a company exceed its total revenues over a specific period, resulting in a negative profit. (Indicates the company's current financial performance, showing an increase in losses for Q2 2025.)

Research and Development (R&D) Expenses

Costs incurred by a company in the process of developing new products or improving existing ones, particularly relevant for pharmaceutical and biotech firms. (Highlights the significant investment in pipeline advancement, with a notable increase in Q2 2025.)

Cash and Cash Equivalents

Highly liquid short-term investments that can be readily converted into cash, representing a company's immediate liquidity. (Shows the company's available funds to meet its short-term obligations and operational needs.)

Burn Rate

The rate at which a company is spending its cash reserves, typically used for companies that are not yet profitable. (Helps assess the company's financial runway and the urgency of its need for further funding.)

Registered Direct Offering

A type of public offering where a company sells newly issued securities directly to a small group of institutional investors. (Details a specific method used by Tempest to raise capital, as seen with the $10.0 million raised in June 2025.)

At-The-Market (ATM) Program

A method for a company to sell its stock over time in the open market at prevailing market prices, often used for ongoing capital needs. (Explains how Tempest raised an additional $1.0 million during Q2 2025.)

Year-Over-Year Comparison

Compared to the prior year's comparable period, Tempest Therapeutics has seen an increase in its net loss, rising by 13.9% to $20.5 million for Q2 2025 from $18.0 million in Q2 2024. This widening loss is accompanied by increased R&D expenses, up to $16.9 million from $14.9 million, reflecting continued investment in its clinical pipeline. While revenue remains non-existent due to its clinical-stage status, the company has actively raised capital through offerings, indicating a proactive approach to managing its cash burn.

Key Financial Figures

• $0.001 — ) on which registered Common Stock, $0.001 par value TPST The Nasdaq Stock Mar

Filing Documents

• tpst-20250630.htm (10-Q) — 2158KB
• tpst-ex10_2.htm (EX-10.2) — 105KB
• tpst-ex10_3.htm (EX-10.3) — 73KB
• tpst-ex10_4.htm (EX-10.4) — 70KB
• tpst-ex10_5.htm (EX-10.5) — 71KB
• tpst-ex10_6.htm (EX-10.6) — 40KB
• tpst-ex10_7.htm (EX-10.7) — 53KB
• tpst-ex31_1.htm (EX-31.1) — 20KB
• tpst-ex31_2.htm (EX-31.2) — 20KB
• tpst-ex32_1.htm (EX-32.1) — 10KB
• 0000950170-25-106558.txt ( ) — 7383KB
• tpst-20250630.xsd (EX-101.SCH) — 860KB
• tpst-20250630_htm.xml (XML) — 959KB

— FINANCIAL INFORMATION

PART I — FINANCIAL INFORMATION 5 Item 1.

Financial Statements (unaudited)

Financial Statements (unaudited): 5 Condensed Consolidated Balance Sheets as of June 30, 2025 and December 31, 2024 5 Condensed Consolidated Statements of Operations for the Three and Six Months Ended June 30, 2025 and 2024 6 Condensed Consolidated Statements of Stockholders' Equity for the Three and Six Months Ended June 30, 2025 and 2024 7 Condensed Consolidated Statements of Cash Flows for the Six Months Ended June 30, 2025 and 2024 8 Notes to Condensed Consolidated Financial Statements 9 Item 2.

Management's Discussion and Analysis of Financial Condition and Results of Operations

Management's Discussion and Analysis of Financial Condition and Results of Operations 19 Item 3.

Quantitative and Qualitative Disclosures About Market Risk

Quantitative and Qualitative Disclosures About Market Risk 28 Item 4.

Controls and Procedures

Controls and Procedures 28

— OTHER INFORMATION

PART II — OTHER INFORMATION 29 Item 1.

Legal Proceedings

Legal Proceedings 29 Item 1A.

Risk Factors

Risk Factors 29 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 81 Item 3. Defaults Upon Senior Securities 81 Item 4. Mine Safety Disclosures 81 Item 5. Other Information 81 Item 6. Exhibits 82

Signatures

Signatures 2 Table of Contents SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS This Quarterly Report on Form 10-Q contains forward-looking statements (including within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, and Section 27A of the Securities Act of 1933, as amended (the "Securities Act")) about us and our industry that involve substantial risks and uncertainties. These statements may discuss goals, intentions and expectations as to future plans, trends, events, results of operations or financial condition, or otherwise, based on current beliefs of our management, as well as assumptions made by, and information currently available to, our management. Forward-looking statements generally include statements that are predictive in nature and depend upon or refer to future events or conditions, and include words such as "may," "will," "should," "would," "could," "expect," "anticipate," "plan," "likely," "believe," "estimate," "intend," and other similar expressions. Statements that are not historical facts are forward-looking statements. Forward-looking statements are based on current beliefs and assumptions that are subject to risks and uncertainties and are not guarantees of future performance. Actual results could differ materially from those contained in any forward-looking statement as a result of various factors, including, without limitation: whether we are successful in implementing our strategic review (which includes our plans to advance our clinical-stage programs and maximize stockholder value); our strategies, prospects, plans, expectations or objectives for future operations; the progress, scope or timing of the development of our product candidates; the benefits that may be derived from any future products or the commercial or market opportunity with respect to any of our future products; our ability to protect our intellectual property rights; our anticipated operations, financial position, ability to raise

– FINANCIAL INFORMATION

PART I – FINANCIAL INFORMATION

– Financial Statements

Item 1 – Financial Statements TEMPEST THERAPEUTICS, INC. Condensed Consolidated Balance Sheets (in thousands, except share and per share amounts) June 30, 2025 (Unaudited) December 31, 2024 Assets Current assets: Cash and cash equivalents $ 14,280 $ 30,268 Prepaid expenses and other current assets 823 1,206 Total current assets 15,103 31,474 Property and equipment — net 748 886 Operating lease right-of-use assets 8,104 8,643 Other noncurrent assets 529 485 Total assets $ 24,484 $ 41,488 Liabilities and stockholders' equity Current liabilities: Accounts payable $ 4,716 $ 2,450 Accrued expenses 1,221 2,726 Current loan payable (net of discount and issuance costs of nil and $ 74 , respectively) — 6,354 Current operating lease liabilities 1,103 869 Accrued compensation 101 1,762 Interest payable — 59 Total current liabilities 7,141 14,220 Operating lease liabilities, less current portion 7,560 8,142 Total liabilities 14,701 22,362 Commitments and contingencies (Note 5) Stockholders' equity: Common stock, $ 0.001 par value; 100,000,000 shares authorized; 4,437,855 and 3,382,432 shares issued and outstanding at June 30, 2025 and December 31, 2024, respectively (1) 4 3 Additional paid-in capital (1) 235,615 226,229 Accumulated deficit ( 225,836 ) ( 207,106 ) Total stockholders' equity 9,783 19,126 Total liabilities and stockholders' equity $ 24,484 $ 41,488 (1) Results, including shares issued and outstanding have been adjusted to reflect the one-for-thirteen stock split effected in April 2025. See Note 1, Organization and Description of the Business, for details. See accompanying Notes to the Condensed Consolidated Financial Statements 5 Table of Contents TEMPEST THERAPEUTICS, INC. Condensed Consolidated Statements of Operations (Unaudited) (in thousands, except share and per share amounts)

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View this 10-Q filing on SEC EDGAR