Xencor Reports 17.5% Revenue Growth in Q2 2026, Operating Loss Widens

Xencor, Inc. reported its financial results for the second quarter of 2026, revealing a total revenue of $51.2 million, a 17.5% increase from $43.6 million in the same period of 2025. For the first half of 2026, revenue decreased to $55.7 million from $76.3 million year-over-year. The revenue growth in the second quarter was primarily driven by increased royalty income from its collaboration with Alexion Pharmaceuticals, which accounted for $37.3 million in royalties, compared to $16.8 million in the prior year. However, the overall decline in revenue for the six-month period was attributed to lower milestone payments, particularly from Incyte Corporation.

Operating expenses for the second quarter rose to $88.3 million, up from $76.8 million in the same quarter of 2025, reflecting increased investment in research and development (R&D) activities. R&D expenses alone increased to $71.9 million from $61.7 million, driven by costs associated with ongoing clinical trials and program advancements. The company reported an operating loss of $37.1 million for the quarter, compared to a loss of $33.2 million in the prior year. For the first half of 2026, the operating loss widened to $114.9 million from $76.4 million in 2025.

In terms of strategic developments, Xencor has made significant progress in its clinical pipeline, with ongoing studies for several engineered antibody therapeutics targeting cancer and autoimmune diseases. The company is currently enrolling patients in seven clinical studies, including trials for XmAb819 and XmAb541, which are designed to engage the immune system against specific tumor types. Additionally, Xencor entered into a settlement agreement with Alexion in July 2026, resolving a dispute over U.S. royalties on Ultomiris, which will result in an expected $105 million payment to Xencor.

As of June 30, 2026, Xencor's total assets were reported at $725 million, a decrease from $875.5 million at the end of 2025. The company had cash and cash equivalents of $44.7 million, down from $54.1 million at the end of the previous year. The decrease in cash was primarily due to higher operating expenses and lower milestone receipts. Xencor's employee headcount remained stable, with no significant changes reported in staffing levels.

Looking ahead, Xencor anticipates continued investment in its clinical programs and expects to utilize its existing cash reserves and anticipated milestone payments to fund operations through at least the next twelve months. The company remains focused on advancing its pipeline and leveraging its collaborations to drive future growth, despite the challenges posed by the current market conditions and the competitive landscape in the biopharmaceutical industry.