v3.25.2
Revenues
 6 Months Ended
Jun. 30, 2025
Revenue from Contract with Customer [Abstract]  
Revenues Revenues
The following table summarizes our revenues by collaboration, category of revenue, and the method of recognition (in millions):
Three Months Ended June 30,Six Months Ended June 30,
Over timePoint in time2025202420252024
Gilead collaboration      
License and R&D services* $154 $27 $177 $160 
Access rights* 6 9 11 17 
Taiho collaboration      
Other*— 3 — 7 
Total revenues  $160 $39 $188 $184 
Total revenues from collaborations$152 $28 $172 $163 
Total revenues from a customer$8 $11 $16 $21 
Revenues from Gilead accounted for 100% and 92% of Total revenues for the three months ended June 30, 2025 and 2024, respectively and 100% and 96% of Total revenues for the six months ended June 30, 2025 and 2024, respectively.
The following table summarizes the revenue recognized as a result of changes in the deferred revenue balance (in millions):
Three Months Ended June 30,Six Months Ended June 30,
2025202420252024
Revenue recognized from amounts in deferred revenue at the beginning of the period$160 $39 $188 $180 
We had $131 million and $319 million of deferred revenue remaining on our Condensed Consolidated Balance Sheets at June 30, 2025 and December 31, 2024, respectively, allocated between current and noncurrent based on the expected timing of future recognition.
Revenue from the Gilead Collaboration
In the first quarter 2025, we decided to pause future development of etrumadenant. In June 2025, Gilead terminated its rights to etrumadenant (the adenosine receptor antagonist program). We determined that this was a significant reduction in the scope of the arrangement, which met the accounting definition of a contract modification. As a result, we accounted for this as both a modification of the existing contract and the creation of a new contract. Under the applicable accounting rules for such contract modifications, we did not adjust the accounting for completed performance obligations that were distinct from the modified goods or services. Accordingly, we allocated the updated transaction price of $256 million, which was comprised of the deferred revenue remaining as of the modification date, to the remaining unsatisfied and partially satisfied performance obligations and updated the measure of progress as of the modification date, which resulted in a cumulative catch-up to revenue of $143 million during the three and six months ended June 30, 2025. The impact of this cumulative catch-up on net income (loss) per share, basic and diluted, in the three and six months ended June 30, 2025, was to reduce net loss per share by $1.35 and $1.40, respectively. See Note 3, Related party - Gilead Sciences, Inc., for more information.
The following table summarizes the allocation of the updated transaction price to the remaining unsatisfied and partially satisfied performance obligations (in millions):
Allocation to performance obligationsDistinctCombinedAmount
License and R&D services*$192 
R&D services*17
Access rights and option continuation periods*30
Rights to certain studies*17
Total allocated transaction price$256 
We account for these performance obligations as follows:
License and R&D Services - Etrumadenant, Quemliclustat and Domvanalimab
Under the Gilead Collaboration Agreement, Gilead obtained options to the exclusive rights: to our adenosine receptor antagonist program, etrumadenant; to our CD73 program, quemliclustat; and to our anti-TIGIT program, domvanalimab and AB308. Effective December 2021, under the First Gilead Collaboration Agreement Amendment, Gilead exercised these options and obtained exclusive licenses to these programs for a total non-refundable payment totaling $725 million.
We determined the standalone selling price of each license using a discounted cash flow method and the R&D services for each program, using an expected cost-plus margin approach. For domvanalimab, we determined that the license was distinct based on an evaluation of the delivery of the license, noting that the program was in the later stages of development and the ongoing R&D services do not significantly modify or customize the related intellectual property. For etrumadenant and quemliclustat programs, we determined that the license and R&D services were combined at the inception of the agreement based on an evaluation of the delivery of the license, due to the early stage of the technology and the specialized nature of our know-how. We recognize the amounts allocated to R&D services for domvanalimab and the combined license and R&D for etrumadenant and quemliclustat as each performance obligation is satisfied, calculated as an estimated percentage of completion based on management's estimated total effort for each program.
Effective June 2025, these performance obligations were partially satisfied and we allocated the updated transaction price to these performance obligations based on their standalone selling prices and adjusted revenue based on an updated measure of progress, which resulted in a cumulative catch-up of revenue of $143 million during the three and six months ended June 30, 2025.
For the three and six months ended June 30, 2025, we recognized revenue of $152 million and $172 million respectively, (including the cumulative catch-up due to Gilead's termination of its rights to etrumadenant). For the three and six months ended June 30, 2024, we recognized revenue of $25 million and $156 million (including the cumulative catch-up due to the Third Gilead Collaboration Agreement Amendment executed in the first quarter 2024), respectively. This was recognized within License and development services revenue in our Condensed Consolidated Statements of Operations.
Access Rights and Option Continuation Periods
Under the Gilead Collaboration Agreement entered into in 2020 and related amendments, Gilead has exclusive access to our current programs as well as future programs for a period of ten years, contingent upon option continuation payments totaling $300 million, consisting of a $100 million payment on each of the fourth (paid in July 2024), sixth, and eighth anniversaries of the Gilead Collaboration Agreement.
The standalone selling price of the ongoing R&D pipeline access and the option continuation material rights were determined using an expected cost-plus margin approach, with the option continuation material rights probability-adjusted for the likelihood of exercise. We use a time-elapsed input method to measure progress toward satisfying the access rights performance obligation, which is the method we believe most faithfully depicts our performance in transferring the promised services during the time period in which Gilead has access to our R&D pipeline. Accordingly, the revenue allocated to the initial four-year access rights performance obligation was recognized using this input method over the remaining period through July 2024, and for the fourth anniversary access rights continuation, over the two-year period commencing July 2024. For the remaining access rights option continuation periods commencing on the sixth, and eighth anniversaries of the agreement, if Gilead elects to exercise their option, we will recognize the revenue allocated to that option together with the $100 million continuation payment over the new minimum access period or immediately if the option lapses.
For the three and six months ended June 30, 2025, we recognized revenue of $5 million and $11 million respectively. For the three and six months ended June 30, 2024, we recognized revenue of $9 million and $17 million, respectively. This was recognized within Other collaboration revenue in our Condensed Consolidated Statements of Operations.
Rights to Certain Studies
Effective January 2024, under the Third Gilead Collaboration Agreement Amendment, we will solely fund certain studies, but Gilead retains exclusive rights to reinstate into the collaboration each study at specified time-points for a payment.
We have determined that these are material rights and we estimated the standalone selling price of these performance obligations using a discounted cash flow method probability-adjusted for the likelihood of exercise. We will recognize the amount allocated to each right if and when the related study is reinstated into the parties' co-development plans or if the option lapses.
As of June 30, 2025, we have $17 million of deferred revenue on our Condensed Consolidated Balance Sheet related to these performance obligations.
R&D Services - Inflammation Programs
In addition to the amendments noted above, in May 2023, we entered into the Second Gilead Collaboration Agreement Amendment pursuant to which we expanded our collaboration to provide Gilead with options to license up to four jointly selected research-stage programs that target inflammatory diseases for which we will lead discovery and early development activities, see Note 3, Related party - Gilead Sciences, Inc., for more information. In 2023, we received a total upfront payment of $35 million for an initial two jointly selected research-stage programs. We determined that the Second Gilead Collaboration Agreement Amendment represented a separate contract.
We determined that we have two separate distinct performance obligations to perform R&D services for Gilead related to discovery and early development activities for each research program for which they have made an upfront payment and, at the amendment closing date, we allocated the transaction price of $35 million equally to the two performance obligations created by this amendment based upon there standalone selling prices. The standalone selling prices of these obligations were determined using an expected cost-plus margin approach. We recognize the amounts allocated to these services as the performance obligation is satisfied, calculated as an estimated percentage of completion based on management's estimated total effort for the program. The options to acquire additional licenses or services did not result in additional performance obligations because they did not provide a material right at contract inception, primarily due to the very early stages of the programs.
For the three and six months ended June 30, 2025, we recognized revenue of $3 million and $5 million respectively. For the three and six months ended June 30, 2024, we recognized revenue of $2 million and $4 million, respectively. This was recognized in Other collaboration revenue in our Condensed Consolidated Statements of Operations.