RLAY

Relay Therapeutics, Inc. (RLAY) - Q1 2026 Filing Summary

Business Context and Reporting Period

This Form 10-Q covers the quarterly period ended March 31, 2026. Relay Therapeutics is a clinical-stage precision medicine company utilizing its Dynamo platform to develop small molecule therapies for cancer and genetic diseases. The company has no products approved for commercial sale and has not generated revenue from product sales. Its lead product candidate, zovegalisib (RLY-2608), is in Phase 3 development for breast cancer and received FDA Breakthrough Therapy designation in February 2026.

Key Financial Metrics

Note: Cash, cash equivalents, and investments calculated as sum of Cash ($204,589) and Investments ($437,476) as of March 31, 2026.

Material Changes vs. Prior Period

• Revenue Decline: Revenue decreased by $4.7 million (61%) to $3.0 million, primarily due to lower milestone recognition from the Elevar Therapeutics license agreement compared to Q1 2025.
• Expense Reduction: Total operating expenses decreased by $11.0 million (12%).
  • R&D Expenses: Decreased by $3.2 million to $70.6 million. This was driven by strategic streamlining of the research organization, partially offset by increased costs for the ReDiscover-2 Phase 3 trial.
  • G&A Expenses: Decreased significantly by $7.7 million to $11.0 million, attributed to lower employee compensation (including stock-based compensation) and the absence of one-time costs related to the Elevar agreement incurred in the prior year.
• Capital Raise: The company raised approximately $137.1 million in net proceeds through "at-the-market" (ATM) offerings during the quarter, selling 14.1 million shares. This contrasts with no financing activity in Q1 2025.
• Liquidity Improvement: Cash and investments increased by approximately $87.5 million quarter-over-quarter, bolstered by the ATM offering and net cash provided by investing activities ($32.9 million).

Outlook, Guidance, and Risks

• Clinical Progress: The company is advancing the ReDiscover-2 Phase 3 trial for zovegalisib in breast cancer. Interim data from the ReDiscover Trial (Q1 2026) showed encouraging efficacy signals at the recommended Phase 3 dose. A triplet combination trial with Pfizer's atirmociclib is also underway.
• Liquidity Outlook: Management believes existing cash, cash equivalents, and investments of $642.1 million are sufficient to fund operations and capital expenditures into 2029.
• Profitability: The company expects to continue incurring significant operating losses for the foreseeable future as it advances clinical trials and expands its pipeline.
• Key Risks:
  • Failure to successfully complete large-scale pivotal clinical trials.
  • Dependence on third-party CROs and manufacturers for clinical execution and supply.
  • Need for substantial additional funding if capital resources are exhausted sooner than expected.
  • Intellectual property disputes and the complexity of the collaboration with D.E. Shaw Research.
  • Regulatory uncertainty, including potential impacts of U.S. policy changes on FDA operations and drug pricing.

Investor Verification Checklist

• Verify the specific enrollment rates and interim data readouts for the ReDiscover-2 Phase 3 trial to assess the timeline for potential regulatory submission.
• Monitor the remaining capacity under the $250 million ATM sales agreement with TD Securities and the company's reliance on equity financing.
• Review the terms of the Elevar Therapeutics agreement to understand future milestone payment triggers and royalty structures.
• Assess the status of the derivative lawsuit filed in December 2024 regarding board compensation and its potential financial impact.
• Confirm the company's burn rate and cash runway assumptions, particularly given the high costs associated with Phase 3 oncology trials.