0001601830-24-000196 | 10-Q | XBRL Viewer | Recursion Pharmaceuticals INC

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Collaborative Development Contracts	9 Months Ended
Collaborative Development Contracts	Sep. 30, 2024
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Collaborative Development Contracts	Collaborative Development Contracts Roche and Genentech Description In December 2021, Recursion entered into a collaboration and license agreement with Roche and Genentech (collectively referred to as Roche). Recursion is constructing, using the Company’s imaging technology and proprietary machine-learning algorithms, unique maps of the inferred relationships amongst perturbation phenotypes in a given cellular context with the goal to discover and develop therapeutic small molecule programs in a gastrointestinal cancer indication and in key areas of neuroscience. Roche and Recursion will collaborate to select certain novel inferences with respect to small molecules or targets generated from the Phenomaps for further validation and optimization as collaboration programs. Roche and Recursion may also combine sequencing datasets from Roche with Recursion’s Phenomaps and collaborate to generate new algorithms to produce multi-modal maps from which additional collaboration programs may be initiated. For every collaboration program that successfully identifies potential therapeutic small molecules or validates a target, Roche will have an option to obtain an exclusive license to develop and commercialize such potential therapeutic small molecules or to exploit such target in the applicable exclusive field. Pricing In January 2022, Recursion received a $150.0 million non-refundable upfront payment from the Company’s collaboration with Roche. In September 2024, Recursion received a $30.0 million milestone payment (the “acceptance fee”) which was an acceptance fee related to the first accepted neuroscience Phenomap. Recursion is eligible for additional milestone payments based on performance progress of the collaboration. Each of the Phenomaps requested by Roche and created by Recursion may be subject to either an initiation fee, acceptance fee or both. Such fees could exceed $250.0 million for 16 accepted Phenomaps. In addition, for a period of time after Roche’s acceptance of certain Phenomaps, Roche will have the option to obtain, subject to payment of an exercise fee, rights to use outside the collaboration the raw images generated in the course of creating those Phenomaps. If Roche exercises its external use option for all 12 eligible Phenomaps, Roche’s associated exercise fee payments to Recursion could exceed $250.0 million. Under the collaboration, Roche may initiate up to 40 programs, each of which, if successfully developed and commercialized, could yield more than $300.0 million in development, commercialization and net revenue milestones for Recursion, as well as tiered royalties on net revenue. Accounting This agreement represents a transaction with a customer and therefore is accounted for in accordance with ASC 606. Recursion has determined that it has three performance obligations, one related to gastrointestinal cancer and two in neuroscience. These performance obligations are for performing research and development services for Roche to identify targets and medicines. The performance obligations also include potential licenses related to the intellectual property. The Company concluded that licenses within the contract are not distinct from the research and development services as they are interrelated due to the fact that the research and development services significantly impact the potential licenses. Any additional services are considered customer options and will be considered as separate contracts for accounting purposes. The Company has determined the transaction price to be $180.0 million, comprised of the upfront payment and the acceptance fee. Prior to the three months ended September 30, 2024, Recursion had fully constrained the $30.0 million variable consideration acceptance fee. As a result of Roche’s acceptance of the neuroscience Phenomap, Recursion is now recognizing the acceptance fee as part of the transaction price over the completion period of one of the neuroscience performance obligations. Recursion has fully constrained the remaining amounts of variable consideration to be received from potential milestones considering the stage of development and the risks associated with the remaining development required to achieve each milestone. Recursion will re-evaluate the transaction price each reporting period. The transaction price was generally allocated to the performance obligations based on the estimated relative stand-alone selling price of each performance obligation as determined using an expected cost plus margin approach. The acceptance fee was allocated to one of the neuroscience performance obligations as the terms of the variable consideration related specifically to Recursion’s efforts to satisfy this performance obligation. The Company recognizes revenue over time based on costs incurred relative to total expected costs to perform the research and development services. Recursion determined that this method provides a faithful depiction of the transfer of control to the customer. This method of recognizing revenue requires the Company to make estimates of total costs to provide the services required under the performance obligations. Significant inputs used to determine the total costs included the length of time required, service hours performed by Company employees and materials costs. A significant change in these estimates could have a material effect on the timing and amount of revenue recognized in future periods. Recursion has estimated the completion of the performance obligations by 2026. Additional Revenue Disclosures Of the revenue recognized during the three and nine months ended September 30, 2024, $4.1 million and $29.0 million was included in the unearned revenue balance as of December 31, 2023, respectively, and was related to the upfront payment received by the Company. Primarily all revenue recognized during the three and nine months ended September 30, 2023 was included in the unearned revenue balance as of December 31, 2022. Revenue recognized during the three and nine months ended September 30, 2024 was from the upfront payments and the acceptance fee received. The recognition of a portion of the upfront payment and acceptance fee decreased the unearned revenue recognized. As of September 30, 2024, the Company had $5.5 million of costs incurred to fulfill a contract on its Condensed Consolidated Balance Sheet within “Other Current Assets.” Unearned revenue was classified as short-term and long-term on the Condensed Consolidated Balance Sheets based on the Company’s estimate of revenue that will be recognized during the next twelve months.

Goodwill and Intangible Assets (Tables)

9 Months Ended

Sep. 30, 2024

Goodwill and Intangible Assets Disclosure [Abstract]

Schedule of Finite-Lived Intangible Assets

The following table summarizes intangible assets:


	September 30, 2024						December 31, 2023
(in thousands)	Gross carrying amount		Accumulated Amortization		Net carrying amount		Gross carrying amount		Accumulated Amortization		Net carrying amount
Definite-lived technology intangible assets	$	44,076	$	(18,719)	$	25,357	$	44,076	$	(8,882)	$	35,194
Definite-lived licensed intangible assets	9,350		(1,600)		7,750		350		(87)		263
Indefinite-lived intangible assets	986		—		986		986		—		986
Total intangible assets	$	54,412	$	(20,319)	$	34,093	$	45,412	$	(8,969)	$	36,443

Schedule of Indefinite-Lived Intangible Assets

The following table summarizes intangible assets:


	September 30, 2024						December 31, 2023
(in thousands)	Gross carrying amount		Accumulated Amortization		Net carrying amount		Gross carrying amount		Accumulated Amortization		Net carrying amount
Definite-lived technology intangible assets	$	44,076	$	(18,719)	$	25,357	$	44,076	$	(8,882)	$	35,194
Definite-lived licensed intangible assets	9,350		(1,600)		7,750		350		(87)		263
Indefinite-lived intangible assets	986		—		986		986		—		986
Total intangible assets	$	54,412	$	(20,319)	$	34,093	$	45,412	$	(8,969)	$	36,443

Net Loss Per Share - Schedule of Computation of Basic and Diluted Net Loss Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023
Numerator:
Net loss	$ (95,842)	$ (93,017)	$ (284,755)	$ (235,070)
Denominator:
Weighted average common shares outstanding, basic (in shares)	282,583,048	214,327,186	253,447,099	203,090,637
Weighted average common shares outstanding, diluted (in shares)	282,583,048	214,327,186	253,447,099	203,090,637
Net loss per share, basic (in dollars per shares)	$ (0.34)	$ (0.43)	$ (1.12)	$ (1.16)
Net loss per share, diluted (in dollars per shares)	$ (0.34)	$ (0.43)	$ (1.12)	$ (1.16)

- Definition

The amount of net income (loss) for the period per each share of common stock or unit outstanding during the reporting period.

+ References

+ Details

- Definition

The amount of net income (loss) for the period available to each share of common stock or common unit outstanding during the reporting period and to each share or unit that would have been outstanding assuming the issuance of common shares or units for all dilutive potential common shares or units outstanding during the reporting period.

+ References

+ Details

- Definition

The portion of profit or loss for the period, net of income taxes, which is attributable to the parent.

+ References

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+ Details

Condensed Consolidated Statements of Cash Flows (unaudited) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023
Cash flows from operating activities
Net loss	$ (284,755)	$ (235,070)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization	23,543	16,849
Stock-based compensation	50,904	37,417
Asset impairment	108	1,188
Lease expense	11,155	6,014
Other, net	(650)	(1,114)
Changes in operating assets and liabilities:
Other receivables and assets	(1,243)	(1,334)
Unearned revenue	(22,374)	(33,360)
Accounts payable	(1,687)	(670)
Accrued development expense	(2,623)	391
Accrued expenses and other current liabilities	(5,001)	3,936
Lease liabilities	(11,121)	(7,950)
Net cash used in operating activities	(243,744)	(213,703)
Cash flows from investing activities
Net cash and restricted cash acquired in the acquisition of a business	0	1,915
Purchases of property and equipment	(12,397)	(9,888)
Purchase of an intangible asset	(3,000)	(247)
Sales and maturities of investments	0	480
Net cash used in investing activities	(15,397)	(7,740)
Cash flows from financing activities
Proceeds from issuance of common shares, net of issuance costs	289,387	50,000
Proceeds from equity incentive plans	6,433	9,546
Repayment of long-term debt and finance lease liabilities	(2,339)	(72)
Net cash provided by financing activities	293,481	59,474
Effect of exchange rate changes on cash, cash equivalents and restricted cash	66	64
Net change in cash, cash equivalents and restricted cash	34,406	(161,905)
Cash, cash equivalents and restricted cash, beginning of period	401,425	559,112
Cash, cash equivalents and restricted cash, end of period	435,831	397,207
Supplemental schedule of non-cash investing and financing activities
Issuance of shares for the acquisitions of businesses	0	91,025
Accrued property and equipment	236	0
Financed equipment purchase	0	1,214
Purchase of an intangible asset	$ 6,000	$ 0

Supplemental Financial Information (Tables)

9 Months Ended

Sep. 30, 2024

Supplemental Financial Information [Abstract]

Schedule of Property and Equipment, Net

Property and Equipment, net


	September 30,		December 31,
(in thousands)	2024		2023
Lab equipment	$	66,754	$	60,096
Leasehold improvements	47,041		45,929
Office equipment	25,370		22,126
Construction in progress	1,712		3,231
Property and equipment, gross	140,877		131,382
Less: Accumulated depreciation	(56,467)		(44,872)
Property and equipment, net	$	84,410	$	86,510

Schedule of Accrued Expenses and Other Liabilities

Accrued Expenses and Other Liabilities


	September 30,		December 31,
(in thousands)	2024		2023
Accrued compensation	$	19,663	$	22,888
Accrued development expenses	3,454		6,077
Accrued early discovery expenses	2,950		2,570
Accrued professional fees	4,682		1,582
Accrued construction	—		2,439
Materials received not invoiced	1,889		2,432
Accrued other expenses	7,959		8,647
Accrued expense and other liabilities	$	40,597	$	46,635

Schedule of Interest Income, Net

Interest Income, net


	Three months ended September 30,				Nine months ended September 30,
(in thousands)	2024		2023		2024		2023
Interest income	$	3,826	$	4,977	$	11,138	$	14,594
Interest expense	(553)		(25)		(967)		(71)
Interest income, net	$	3,273	$	4,952	$	10,171	$	14,523

Net Loss Per Share - Schedule of Antidilutive Securities Excluded from Computation of Net Loss Per Share (Details) - shares	3 Months Ended		9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of loss per share, amount (in shares)	12,564,729	12,162,449	14,793,913	9,022,502
Stock based compensation
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of loss per share, amount (in shares)	5,869,795	12,162,449	8,098,979	9,022,502
Tempus agreement
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of loss per share, amount (in shares)	6,694,934	0	6,694,934	0

Acquisitions - Schedule of Total Consideration (Details) - USD ($) $ in Thousands	May 25, 2023	May 16, 2023
Valence Discovery Inc
Business Acquisition [Line Items]
Deferred liabilities for additional consideration		$ 396
Total consideration		35,898
Valence Discovery Inc \| Employee Stock
Business Acquisition [Line Items]
Fair value of stock and equity awards		1,933
Valence Discovery Inc \| Class A Common Stock
Business Acquisition [Line Items]
Fair value of stock and equity awards		11,096
Valence Discovery Inc \| Exchangeable Stock
Business Acquisition [Line Items]
Fair value of stock and equity awards		$ 22,473
Cyclica Inc
Business Acquisition [Line Items]
Cash	$ 6,505
Deferred liabilities for additional consideration	345
Total consideration	60,617
Cyclica Inc \| Employee Stock
Business Acquisition [Line Items]
Fair value of stock and equity awards	3,852
Cyclica Inc \| Class A Common Stock
Business Acquisition [Line Items]
Fair value of stock and equity awards	$ 49,915

Net Loss Per Share

9 Months Ended

Sep. 30, 2024

Earnings Per Share [Abstract]

Net Loss Per Share

For the three and nine months ended September 30, 2024 and 2023, Recursion calculated net loss per share of Class A, Class B and the Exchangeable common stock using the two-class method. Basic net loss per share is computed using the weighted-average number of shares outstanding during the period. Diluted net loss per share is computed using the weighted-average number of shares and the effect of potentially dilutive securities outstanding during the period. Potentially dilutive securities consist of stock options and other contingently issuable shares. For periods presented in which the Company reports a net loss, all potentially dilutive shares are anti-dilutive and as such are excluded from the calculation. For the three and nine months ended September 30, 2024 and 2023, the Company reported a net loss and therefore basic and diluted loss per share were the same.

The rights, including the liquidation and dividend rights, of the holders of the Company’s Class A, Class B and the Exchangeable common stock are identical, except with respect to voting. As a result, the undistributed earnings for each period are allocated based on the contractual participation rights of the Class A, Class B and the Exchangeable common stock as if the earnings for the period had been distributed. As the liquidation and dividend rights are identical, the undistributed earnings are allocated on a proportionate basis and the resulting amount per share for Class A, Class B and the Exchangeable common stock was the same during the three and nine months ended September 30, 2024 and 2023.

The following tables set forth the computation of basic and diluted net loss per share of Class A, Class B and Exchangeable common stock:


	Three months ended September 30,				Nine months ended September 30,
(in thousands, except share amounts)	2024		2023		2024		2023
Numerator:
Net loss	$	(95,842)	$	(93,017)	$	(284,755)	$	(235,070)
Denominator:
Weighted average common shares outstanding	282,583,048		214,327,186		253,447,099		203,090,637
Net loss per share, basic and diluted	$	(0.34)	$	(0.43)	$	(1.12)	$	(1.16)

The Company excluded the following potential common shares from the computation of diluted net loss per share for the periods indicated because including them would have had an anti-dilutive effect:


	Three months ended September 30,		Nine months ended September 30,
	2024	2023	2024	2023
Stock based compensation	5,869,795	12,162,449	8,098,979	9,022,502
Tempus agreement	6,694,934	—	6,694,934	—
Total	12,564,729	12,162,449	14,793,913	9,022,502

Leases - Schedule of Lease Term and Discount Rates (Details)	Sep. 30, 2024
Leases [Abstract]
Operating leases, weighted-average remaining lease term (years)	5 years 8 months 12 days
Operating leases, weighted-average discount rate	7.90%
Finance leases, weighted-average remaining lease term (years)	2 years 9 months 18 days
Finance leases, weighted-average discount rate	7.60%

Common Stock	9 Months Ended
Common Stock	Sep. 30, 2024
Equity [Abstract]
Common Stock	Common Stock Each share of Class A common stock entitles the holder to one vote per share and each share of Class B common stock entitles the holder to 10 votes per share on all matters submitted to a vote of the Company’s stockholders. Common stockholders are entitled to receive dividends, as may be declared by the Company’s Board of Directors. As of September 30, 2024 and December 31, 2023, no dividends had been declared. Public Offering of Common Stock On June 28, 2024, the Company closed its public offering of Class A common stock and issued 35.4 million shares at a price of $6.50 per share for net proceeds of approximately $216.4 million, after deducting transaction costs of $13.6 million. In connection with the public offering of Class A common stock, the Company entered into an underwriting agreement for the offering and sale of 30.8 million shares. The Company also granted the Underwriters a 30 day option from the date of the underwriting agreement to purchase up to an additional 4.6 million shares of Class A Common Stock, which was exercised in full. The public offering was made pursuant to the Company's effective registration statement on Form S-3 (File No. 333-264845) and a related prospectus supplement and accompanying prospectus dated June 26, 2024. At-The-Market Offering In August 2023, the Company entered into an Open Market Sales Agreement (the “Sales Agreement”) with Jefferies LLC (the “Sales Agent”), to provide for the offering, issuance and sale of up to an aggregate amount of $300.0 million of its Class A common stock from time to time in “at-the-market” (ATM) offerings. As of September 30, 2024, an amount of $144.3 million remained available for future sales under the Sales Agreement. For the nine months ended September 30, 2024, the Company has sold 8.4 million shares and received net proceeds of $72.9 million under the agreement. Recursion is not required to sell additional shares under the Sales Agreement. The Company will pay the Sales Agent a commission of up to 3% of the aggregate gross proceeds received from all sales of Class A common stock. The Sales Agreement continues until the earlier of selling all shares available under the Sales Agreement or terminated by written notice from either of the parties. The ATM Offering is being made under a prospectus supplement dated August 8, 2023, and related prospectus filed with the Securities and Exchange Commission pursuant to our automatically effective shelf registration statement on Form S-3ASR (Registration No. 333-264845). NVIDIA Private Placement In July 2023, Recursion entered into a Stock Purchase Agreement for a private placement with NVIDIA Corporation (2023 Private Placement), pursuant to which the Company sold an aggregate of 7.7 million shares of the Company’s Class A common stock at a price of $6.49 per share for net proceeds of approximately $49.9 million. Valence Acquisition Exchangeable Shares In May 2023, in connection with the acquisition of Valence, the Company entered into an agreement to issue up to 5.9 million shares of Class A common stock (the “Exchangeable Shares”), that may be issued upon exchange, retraction or redemption of exchangeable shares of a subsidiary of Recursion. Each exchangeable share of the subsidiary of Recursion entitles the holder to exchange those shares on a one-for-one basis for Recursion’s Class A common stock. The shares are entitled to receive dividends economically equivalent to dividends declared by Recursion, are non-voting and are subject to customary adjustments for stock splits or other reorganizations. In addition, the Company may require all outstanding exchangeable shares to be exchanged into an equal number of Class A common stock upon the occurrence of certain events and at any time following the seventh anniversary of the closing of the Valence acquisition. The exchangeable shares are substantially the economic equivalent of the Class A shares and classified as common stock within the Company’s stockholders’ equity. The Company’s calculation of weighted-average shares outstanding includes the exchangeable shares. As of September 30, 2024, 4.9 million Exchangeable shares have been redeemed for Class A shares. Registration Rights Agreements Tempus agreement In November 2023, in connection with the Tempus Agreement, the Company agreed to prepare and file a registration statement (or a prospectus supplement to an effective registration statement on Form S-3ASR that will become automatically effective upon filing with the SEC pursuant to Rule 462(e)) with the SEC, for resale of the shares of Class A common stock issued or issuable under the Tempus Agreement. A prospectus supplement to a registration statement (File No. 333-264845) was subsequently filed in December 2023 to register shares issued to Tempus for the initial license fee under the Tempus Agreement for resale. After registration of any shares issued to Tempus under the Tempus Agreement, the Company has agreed to use commercially reasonable efforts to keep such registration statement effective until such date that all shares issued to Tempus covered by such registration statement have been sold or are able to be publicly sold by relying on Rule 144 of the Securities Act without registration. NVIDIA Private Placement In July 2023, in connection with the 2023 Private Placement with NVIDIA, the Company entered into a Registration Rights Agreement providing for the registration for resale of the shares of Class A common stock issued in such transaction. A prospectus supplement to a registration statement (File No. 333-264845) was subsequently filed in August 2023 to register the resale of the shares of Class A common stock issued to NVIDIA. The Company has agreed to use commercially reasonable efforts to keep the registration statement continuously effective until such date that all registrable securities under the agreement have been sold. In the event the holders cannot sell their shares due to certain circumstances causing the registration statement to be ineffective, the Company must pay each holder of shares outstanding on the date and each month thereafter 1% of the aggregate purchase price with the maximum payable amount of 5% of the aggregate purchase price. As of September 30, 2024, there was no accrued liability related to this agreement, as it was not probable that a payment would be required. Acquisitions In May 2023, in connection with the acquisition of Valence, the Company entered into a Registration Agreement providing for the registration for resale of the shares of Class A common stock and Exchange Shares issued or issuable in such transaction. A registration statement on Form S-3ASR (File No. 333-272281) was filed to register the shares for resale by the holders. The registration statement must remain effective for a period of not less than three years. In May 2023, in connection with the acquisition of Cyclica, the Company entered into a Registration Agreement providing for the registration for resale of the shares of Class A common stock issued in such transaction. A prospectus supplement to a registration statement (File No. 333-264845) was subsequently filed in June 2023 to register the shares for resale by the holders. The registration agreement must be continuously effective until the earlier of the date that all shares have been sold thereunder or are able to be publicly sold by relying on Rule 144 of the Securities Act without registration. 2022 Private Placement In October 2022, in connection with the 2022 Private Placement, the Company entered into a Registration Rights Agreement providing for the registration for resale of the shares of Class A common stock issued in such transaction. A prospectus supplement to a registration statement (File No. 333-264845) was subsequently filed in October 2022 to register the resale of the shares of Class A common stock by the Purchasers. The agreement must remain effective until registrable securities covered by the agreement have been publicly sold by the holders or all shares cease to be registrable securities. In the event the holders cannot sell their shares due to certain circumstances causing the agreement to be ineffective, the Company must pay each holder of shares outstanding on the date and each month thereafter 1.0% of the aggregate purchase price paid by the holder without limit until the agreement is cured. As of September 30, 2024, there was no accrued liability related to this agreement, as it was not probable that a payment would be required. Class A and B Common Stock Authorization In April 2021, the Company’s Board of Directors authorized two classes of common stock, Class A and Class B. The rights of the holders of Class A and B common stock are identical, except with respect to voting and conversion. Each share of Class A common stock is entitled to one vote per share. Each share of Class B common stock is entitled to 10 votes per share and is convertible at any time into one share of Class A common stock. All Class B common stock is held by Christopher Gibson, Ph.D., the Company’s Chief Executive Officer (CEO), or his affiliates. As of September 30, 2024, Dr. Gibson and his affiliates held outstanding shares of Class B common stock representing approximately 20% of the voting power of the Company’s outstanding shares. This voting power may increase over time as Dr. Gibson vests in and exercises equity awards outstanding. If all the exchangeable equity awards held by Dr. Gibson had been fully vested, exercised and exchanged for shares of Class B common stock as of September 30, 2024, Dr. Gibson and his affiliates would hold approximately 20% of the voting power of the Company’s outstanding shares. As a result, Dr. Gibson will be able to significantly influence any action requiring the approval of Recursion stockholders, including the election of the Board of Directors; the adoption of amendments to the Company’s certificate of incorporation and bylaws; and the approval of any merger, consolidation, sale of all or substantially all of the Company’s assets, or other major corporate transaction.

- Definition

The entire disclosure for equity.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 13
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147481112/505-10-50-13

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
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-URI https://asc.fasb.org/1943274/2147481112/505-10-50-13

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
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-Section 50
-Paragraph 14
-Subparagraph (b)
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-URI https://asc.fasb.org/1943274/2147481112/505-10-50-14

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
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-Name Accounting Standards Codification
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-Paragraph 2
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147477968/946-235-50-2

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
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-Name Accounting Standards Codification
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-Paragraph 2
-Subparagraph (d)
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-URI https://asc.fasb.org/1943274/2147477968/946-235-50-2

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
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-Name Accounting Standards Codification
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Reference 7: http://www.xbrl.org/2003/role/disclosureRef
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-Name Accounting Standards Codification
-Section 50
-Paragraph 6
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147480237/815-40-50-6

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
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-Paragraph 1
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-URI https://asc.fasb.org/1943274/2147480008/505-10-S99-1

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Topic 235
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-Name Accounting Standards Codification
-Section S99
-Paragraph 1
-Subparagraph (SX 210.4-08(e)(1))
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Reference 10: http://fasb.org/us-gaap/role/ref/legacyRef
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-Name Accounting Standards Codification
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-URI https://asc.fasb.org/505/tableOfContent

Reference 11: http://www.xbrl.org/2003/role/disclosureRef
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Reference 12: http://www.xbrl.org/2003/role/disclosureRef
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Reference 13: http://www.xbrl.org/2003/role/disclosureRef
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-Section 50
-Paragraph 13
-Subparagraph (i)
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-URI https://asc.fasb.org/1943274/2147481112/505-10-50-13

Reference 14: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
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-Name Accounting Standards Codification
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-Paragraph 14
-Subparagraph (a)
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Reference 15: http://www.xbrl.org/2003/role/disclosureRef
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Reference 16: http://www.xbrl.org/2003/role/disclosureRef
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Reference 17: http://www.xbrl.org/2003/role/disclosureRef
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Reference 18: http://www.xbrl.org/2003/role/disclosureRef
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Reference 19: http://www.xbrl.org/2003/role/disclosureRef
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-URI https://asc.fasb.org/1943274/2147481112/505-10-50-18

+ Details

Income Taxes (Details) - USD ($)	3 Months Ended		9 Months Ended
Income Taxes (Details) - USD ($)	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023
Income Tax Disclosure [Abstract]
U.S. income tax expense	$ 0	$ 0	$ 0	$ 0

Supplemental Financial Information - Schedule of Property and Equipment, Net (Details) - USD ($) $ in Thousands	Sep. 30, 2024	Dec. 31, 2023
Property, Plant and Equipment [Line Items]
Property and equipment, gross	$ 140,877	$ 131,382
Less: Accumulated depreciation	(56,467)	(44,872)
Property and equipment, net	84,410	86,510
Lab equipment
Property, Plant and Equipment [Line Items]
Property and equipment, gross	66,754	60,096
Leasehold improvements
Property, Plant and Equipment [Line Items]
Property and equipment, gross	47,041	45,929
Office equipment
Property, Plant and Equipment [Line Items]
Property and equipment, gross	25,370	22,126
Construction in progress
Property, Plant and Equipment [Line Items]
Property and equipment, gross	$ 1,712	$ 3,231

Fair Value Measurements (Tables)

9 Months Ended

Sep. 30, 2024

Fair Value Disclosures [Abstract]

Schedule of Assets and Liabilities Measured at Fair Value on a Recurring Basis

The following tables summarize the Company’s assets and liabilities that are measured at fair value on a recurring basis:


			Basis of fair value measurement
(in thousands)	September 30, 2024		Level 1		Level 2		Level 3
Assets
Cash equivalents:
Money market funds	$	233,015	$	233,015	$	—	$	—
Restricted cash	8,184		8,184		—		—
Total assets	$	241,199	$	241,199	$	—	$	—


			Basis of fair value measurement
(in thousands)	December 31, 2023		Level 1		Level 2		Level 3
Assets
Cash equivalents:
Money market funds	$	322,653	$	322,653	$	—	$	—
Restricted cash	9,860		9,860		—		—
Total assets	$	332,513	$	332,513	$	—	$	—

Schedule of Financial Instruments Not Measured at Fair Value

The following tables summarize the Company’s financial instruments that are not measured at fair value:


	Book values				Fair values
(in thousands)	September 30, 2024		December 31, 2023		September 30, 2024		December 31, 2023
Liabilities
Notes payable and financing lease liabilities, current	$	8,219	$	41	$	8,219	$	41
Notes payable and financing lease liabilities, non-current	20,510		1,101		20,510		1,101
Total liabilities	$	28,729	$	1,142	$	28,729	$	1,142

Supplemental Financial Information

9 Months Ended

Sep. 30, 2024

Supplemental Financial Information [Abstract]

Supplemental Financial Information

Tempus agreement

In November 2023, Recursion entered into a five-year agreement with Tempus Labs, Inc. (Tempus) to purchase access to their records of patient-centric multimodal oncology data and use rights for therapeutic development purposes. This data will be used to improve the training of Recursion’s artificial intelligence and machine learning models and is expected to accelerate Recursion’s drug discovery process. Recursion is making annual payments, ranging between $22.0 million and $42.0 million, up to $160.0 million in aggregate, to Tempus in cash or equity at the Company’s option. The equity value is determined by using the seven-trading day period dollar volume-weighted average price (VWAP) for Recursion Class A common stock ending on the day immediately preceding the date that is five business days prior to the payment date.

Recursion is expensing the record purchases based on a contractually agreed price as “Research and Development” expenses in the Condensed Consolidated Statements of Operations as the records are downloaded. To the extent that the Recursion payments to Tempus are greater than or less than the records purchased amount, Recursion records the applicable amount to “Other Current Assets” or “Accrued Expenses and Other Liabilities” on the Condensed Consolidated Balance Sheet, respectively. As of September 30, 2024, Recursion had recorded $13.1 million within “Other Current Assets” on the Consolidated Balance Sheet related to the Tempus agreement.

Property and Equipment, net


	September 30,		December 31,
(in thousands)	2024		2023
Lab equipment	$	66,754	$	60,096
Leasehold improvements	47,041		45,929
Office equipment	25,370		22,126
Construction in progress	1,712		3,231
Property and equipment, gross	140,877		131,382
Less: Accumulated depreciation	(56,467)		(44,872)
Property and equipment, net	$	84,410	$	86,510

Depreciation expense on property and equipment was $4.0 million and $12.1 million during the three and nine months ended September 30, 2024, respectively, and $4.2 million and $11.7 million during the three and nine months ended September 30, 2023, respectively. The Company recorded an insignificant impairment and an impairment of $1.2 million during the nine months ended September 30, 2024 and 2023, respectively, related to construction projects for leasehold improvements as the Company no longer intended to use them. The impairments were recorded in “General and Administrative” in the Condensed Consolidated Statements of Operations.

Accrued Expenses and Other Liabilities


	September 30,		December 31,
(in thousands)	2024		2023
Accrued compensation	$	19,663	$	22,888
Accrued development expenses	3,454		6,077
Accrued early discovery expenses	2,950		2,570
Accrued professional fees	4,682		1,582
Accrued construction	—		2,439
Materials received not invoiced	1,889		2,432
Accrued other expenses	7,959		8,647
Accrued expense and other liabilities	$	40,597	$	46,635

Interest Income, net


	Three months ended September 30,				Nine months ended September 30,
(in thousands)	2024		2023		2024		2023
Interest income	$	3,826	$	4,977	$	11,138	$	14,594
Interest expense	(553)		(25)		(967)		(71)
Interest income, net	$	3,273	$	4,952	$	10,171	$	14,523

For the three and nine months ended September 30, 2024 and 2023, interest income primarily related to earnings on cash and cash equivalents in money market funds. Interest expense primarily related to the Company’s supercomputer financing lease. Interest income, net was included in “Other income, net” on the Condensed Consolidated Statements of Operations.

Goodwill and Intangible Assets - Schedule of Intangible assets (Details) - USD ($) $ in Thousands	Sep. 30, 2024	Dec. 31, 2023
Goodwill [Line Items]
Accumulated Amortization	$ (20,319)	$ (8,969)
Indefinite-lived intangible assets	986	986
Intangible assets, gross	54,412	45,412
Intangible assets, net	34,093	36,443
Technology Intangible Assets
Goodwill [Line Items]
Gross carrying amount	44,076	44,076
Accumulated Amortization	(18,719)	(8,882)
Net carrying amount	25,357	35,194
Licensing Agreements
Goodwill [Line Items]
Gross carrying amount	9,350	350
Accumulated Amortization	(1,600)	(87)
Net carrying amount	$ 7,750	$ 263

- Definition

Line items represent financial concepts included in a table. These concepts are used to disclose reportable information associated with domain members defined in one or many axes to the table.

+ References

Reference 1: http://www.xbrl.org/2003/role/exampleRef
-Topic 350
-SubTopic 20
-Name Accounting Standards Codification
-Section 55
-Paragraph 24
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482548/350-20-55-24

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Topic 350
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-Name Accounting Standards Codification
-Section 50
-Paragraph 2
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-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482573/350-20-50-2

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
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Reference 4: http://www.xbrl.org/2003/role/disclosureRef
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Reference 5: http://www.xbrl.org/2003/role/disclosureRef
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Reference 6: http://www.xbrl.org/2003/role/disclosureRef
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Reference 11: http://www.xbrl.org/2003/role/disclosureRef
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Reference 12: http://www.xbrl.org/2003/role/disclosureRef
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-URI https://asc.fasb.org/1943274/2147482573/350-20-50-1A

+ Details

Acquisitions - Schedule of Fair Value of Assets Acquired and Liabilities Assumed (Details) - USD ($) $ in Thousands	Sep. 30, 2024	Dec. 31, 2023	May 25, 2023	May 16, 2023
Business Acquisition [Line Items]
Goodwill	$ 52,056	$ 52,056
Valence Discovery Inc
Business Acquisition [Line Items]
Cash				$ 4,235
Other receivables				536
Intangible assets - technology				15,000
Accounts payable and accrued liabilities				(872)
Deferred income taxes				(3,265)
Total identifiable net assets				15,634
Goodwill				20,264
Total assets acquired and liabilities assumed				$ 35,898
Cyclica Inc
Business Acquisition [Line Items]
Cash			$ 2,429
Restricted cash			1,685
Other receivables			741
Investments			1,000
Other current assets			385
Intangible assets - technology			28,000
Accounts payable and accrued liabilities			(579)
Unearned revenue			(1,754)
Deferred income taxes			(2,075)
Other liabilities, current			(66)
Other liabilities, non-current			(139)
Total identifiable net assets			29,627
Goodwill			30,990
Total assets acquired and liabilities assumed			$ 60,617

Leases - Schedule of Maturities of Operating Lease and Finance Lease Liabilities (Details) $ in Thousands	Sep. 30, 2024 USD ($)
Operating leases
Remainder of 2024	$ 2,268
2025	14,585
2026	15,467
2027	15,914
2028	13,226
Thereafter	17,660
Total lease payments	79,120
Less amounts representing interest or imputed interest	(17,224)
Present value of lease liabilities	61,896
Finance leases
Remainder of 2024	2,511
2025	10,046
2026	10,046
2027	8,736
2028	0
Thereafter	0
Total lease payments	31,339
Less amounts representing interest or imputed interest	(3,699)
Present value of lease liabilities	$ 27,640

Description of the Business (Details) - USD ($) $ in Thousands	Sep. 30, 2024	Dec. 31, 2023
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Accumulated deficit	$ 1,252,377	$ 967,622

- Definition

Amount of accumulated undistributed earnings (deficit).

+ References + Details

Goodwill and Intangible Assets

9 Months Ended

Sep. 30, 2024

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill and Intangible Assets

Goodwill

There were no changes to the carrying amount of goodwill during the three and nine months ended September 30, 2024. There were additions of $51.3 million to the carrying amount of goodwill related to the acquisition of Cyclica and Valence during the nine months ended September 30, 2023. No goodwill impairment was recorded during the three and nine months ended September 30, 2024 and 2023.

Intangible Assets, Net

The following table summarizes intangible assets:


	September 30, 2024						December 31, 2023
(in thousands)	Gross carrying amount		Accumulated Amortization		Net carrying amount		Gross carrying amount		Accumulated Amortization		Net carrying amount
Definite-lived technology intangible assets	$	44,076	$	(18,719)	$	25,357	$	44,076	$	(8,882)	$	35,194
Definite-lived licensed intangible assets	9,350		(1,600)		7,750		350		(87)		263
Indefinite-lived intangible assets	986		—		986		986		—		986
Total intangible assets	$	54,412	$	(20,319)	$	34,093	$	45,412	$	(8,969)	$	36,443

Amortization expense was $4.1 million and $11.3 million during the three and nine months ended September 30, 2024, respectively. Amortization expense was $3.4 million and $5.1 million during the three and nine months ended September 30, 2023, respectively. Amortization expense was included in “Research and Development” in the Condensed Consolidated Statements of Operations. No indefinite-lived intangible asset impairment charges were recorded during the three and nine months ended September 30, 2024 and 2023.

For the nine months ended September 30, 2024, the Company entered into a 3 year licensing agreement with Helix for access to their patient data and use rights for therapeutics development purposes. This data will be used to improve the training of Recursion’s artificial intelligence and machine learning models and is expected to accelerate Recursion’s drug discovery process. Recursion is making annual payments of $3.0 million for a total of $9.0 million, which was recorded in “Intangible Assets, net” on the Condensed Consolidated Balance Sheet and included as a licensed intangible asset in the above table. Recursion made the first payment during the nine months ended September 30, 2024 and recorded the two remaining $3.0 million payments in “Accrued expenses and other liabilities” and “Other liabilities, non-current” on the Condensed Consolidated Balance Sheet, respectively. The licensed intangible asset is being amortized on a straight-line basis over its three-year useful life.

Supplemental Financial Information - Schedule of Accrued Expenses and Other Liabilities (Details) - USD ($) $ in Thousands	Sep. 30, 2024	Dec. 31, 2023
Supplemental Financial Information [Abstract]
Accrued compensation	$ 19,663	$ 22,888
Accrued development expenses	3,454	6,077
Accrued early discovery expenses	2,950	2,570
Accrued professional fees	4,682	1,582
Accrued construction	0	2,439
Materials received not invoiced	1,889	2,432
Accrued other expenses	7,959	8,647
Accrued expenses and other liabilities	$ 40,597	$ 46,635

Stock-Based Compensation - Narrative (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions	9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Options granted in period, weighted average grant date fair value (in dollars per share)	$ 5.88	$ 5.64
Unvested stock options, unamortized stock-based compensation cost	$ 38.2
Unvested stock options, unamortized stock-based compensation cost, weighted average period recognition	2 years
Stock Options
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock options, vesting period	4 years
Stock options, expiration period	10 years
RSUs
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock options, vesting period	4 years
Unvested stock options, unamortized stock-based compensation cost, weighted average period recognition	3 years
Fair market value of vested shares	$ 39.3
Unrecognized compensation cost	$ 146.4
2021 Equity Incentive Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of shares available for grant (in shares)	12.5

Acquisitions (Tables)

9 Months Ended

Sep. 30, 2024

Business Combination, Asset Acquisition, and Joint Venture Formation [Abstract]

Schedule of Total Consideration

The following table summarizes total consideration:


(in thousands)
Fair value of Recursion Class A common stock	$	11,096
Fair value of Exchangeable stock	22,473
Fair value of equity awards issued to Valance equity award holders	1,933
Deferred liabilities for additional consideration	396
Total consideration	$	35,898

The following table summarizes total consideration:


(in thousands)
Fair value of Recursion Class A common stock	$	49,915
Cash	6,505
Fair value of equity awards issued to Cyclica equity award holders	3,852
Deferred liabilities for additional consideration	345
Total consideration	$	60,617

Schedule of Fair Value of Assets Acquired and Liabilities Assumed

The following table summarizes the fair value of assets acquired and liabilities assumed as of the acquisition date:


(in thousands)
Cash	$	4,235
Other receivables	536
Intangible asset - technology	15,000
Accounts payable and accrued liabilities	(872)
Deferred income taxes	(3,265)
Total identifiable net assets	15,634
Goodwill	20,264
Total assets acquired and liabilities assumed	$	35,898

The following table summarizes the fair value of assets acquired and liabilities assumed as of the acquisition date:


(in thousands)
Cash	$	2,429
Restricted cash	1,685
Other receivables	741
Investments	1,000
Other current assets	385
Intangible assets - technology	28,000
Accounts payable and accrued liabilities	(579)
Unearned revenue	(1,754)
Deferred income taxes	(2,075)
Other liabilities, current	(66)
Other liabilities, non-current	(139)
Total identifiable net assets	29,627
Goodwill	30,990
Total assets acquired and liabilities assumed	$	60,617

Schedule of Pro Forma Financial Information

The following table presents the unaudited pro forma combined results of operations of Recursion, Valence and Cyclica as if the acquisitions had occurred on January 1, 2022:


(in thousands)	Three months ended September 30, 2023		Nine Months Ended September 30, 2023
Net revenue	$	10,534	$	33,970
Net loss	(92,553)		(245,391)

Condensed Consolidated Balance Sheets (unaudited) (Parenthetical) - $ / shares	Sep. 30, 2024	Dec. 31, 2023
Common stock, par value (in dollars per share)	$ 0.00001	$ 0.00001
Common stock, shares authorized (in shares)	2,000,000,000	2,000,000,000
Common stock, shares issued (in shares)	286,124,279	234,270,384
Common sock, shares outstanding (in shares)	286,124,279	234,270,384
Class A Common Stock
Common stock, shares authorized (in shares)	1,989,032,117	1,989,032,117
Common stock, shares issued (in shares)	278,848,301	226,264,764
Common sock, shares outstanding (in shares)	278,848,301	226,264,764
Class B Common Stock
Common stock, shares authorized (in shares)	10,967,883	10,967,883
Common stock, shares issued (in shares)	7,078,575	7,544,871
Common sock, shares outstanding (in shares)	7,078,575	7,544,871
Exchangeable Stock
Common stock, shares issued (in shares)	197,403	460,749
Common sock, shares outstanding (in shares)	197,403	460,749

Stock-Based Compensation - Schedule of Weighted-Average Assumptions Used to Calculate Grant-Date Fair Value of Stock Options (Details) - Stock based compensation	9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Expected term (in years)	6 years 2 months 12 days	5 years 9 months 18 days
Expected volatility	65.00%	66.00%
Expected dividend yield	0.00%	0.00%
Risk-free interest rate	4.20%	3.60%

- Definition

Line items represent financial concepts included in a table. These concepts are used to disclose reportable information associated with domain members defined in one or many axes to the table.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Topic 718
-SubTopic 10
-Name Accounting Standards Codification
-Section 35
-Paragraph 1D
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147480483/718-10-35-1D

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Topic 718
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-Section 35
-Paragraph 3
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-URI https://asc.fasb.org/1943274/2147480483/718-10-35-3

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Topic 718
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-Name Accounting Standards Codification
-Section 50
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Reference 4: http://www.xbrl.org/2003/role/disclosureRef
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Reference 5: http://www.xbrl.org/2003/role/disclosureRef
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Reference 6: http://www.xbrl.org/2003/role/disclosureRef
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Reference 7: http://www.xbrl.org/2003/role/disclosureRef
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Reference 8: http://www.xbrl.org/2003/role/disclosureRef
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Reference 9: http://www.xbrl.org/2003/role/disclosureRef
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-Section 50
-Paragraph 2
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Reference 10: http://www.xbrl.org/2003/role/disclosureRef
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-Section 50
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Reference 11: http://www.xbrl.org/2003/role/disclosureRef
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-Section 50
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Reference 12: http://www.xbrl.org/2003/role/disclosureRef
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-Section 50
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Reference 13: http://www.xbrl.org/2003/role/disclosureRef
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-Section 50
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Reference 14: http://www.xbrl.org/2003/role/disclosureRef
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-Section 50
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Reference 26: http://www.xbrl.org/2003/role/disclosureRef
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Reference 27: http://www.xbrl.org/2003/role/disclosureRef
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-URI https://asc.fasb.org/1943274/2147480429/718-10-50-2

+ Details

Condensed Consolidated Statements of Operations and Comprehensive Loss (unaudited) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023
Revenue
Total revenue	$ 26,082	$ 10,533	$ 54,293	$ 33,684
Operating costs and expenses
Cost of revenue	12,079	10,877	32,444	32,706
Research and development	74,600	70,007	216,087	171,744
General and administrative	37,757	29,199	100,998	80,364
Total operating costs and expenses	124,436	110,083	349,529	284,814
Loss from operations	(98,354)	(99,550)	(295,236)	(251,130)
Other income, net	2,679	6,533	9,347	16,060
Loss before income tax benefit	(95,675)	(93,017)	(285,889)	(235,070)
Income tax benefit	(167)	0	1,134	0
Net loss	(95,842)	(93,017)	(284,755)	(235,070)
Comprehensive loss	$ (95,842)	$ (93,017)	$ (284,755)	$ (235,070)
Per share data
Net loss per share of class A, B and Exchangeable common stock, basic (in dollars per share)	$ (0.34)	$ (0.43)	$ (1.12)	$ (1.16)
Net loss per share of class A, B and Exchangeable common stock, diluted (in dollars per share)	$ (0.34)	$ (0.43)	$ (1.12)	$ (1.16)
Weighted-average shares (Class A, B and Exchangeable) outstanding, basic (in shares)	282,583,048	214,327,186	253,447,099	203,090,637
Weighted-average shares (Class A, B and Exchangeable) outstanding, diluted (in shares)	282,583,048	214,327,186	253,447,099	203,090,637
Operating revenue
Revenue
Total revenue	$ 26,082	$ 10,102	$ 53,977	$ 33,252
Grant revenue
Revenue
Total revenue	$ 0	$ 431	$ 316	$ 432

Collaborative Development Contracts (Details) $ in Millions	1 Months Ended		3 Months Ended	9 Months Ended
Collaborative Development Contracts (Details) $ in Millions	Sep. 30, 2024 USD ($)	Jan. 31, 2022 USD ($) phenomap program performance_obligation	Sep. 30, 2024 USD ($)	Sep. 30, 2024 USD ($)
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Revenue recognized			$ 4.1	$ 29.0
Contract with customer, asset	$ 5.5		$ 5.5	$ 5.5
Roche and Genentech \| Collaborative Arrangement
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Remaining unearned revenue		$ 150.0
Revenue recognized	$ 30.0
Number of performance obligations under the agreement (in performance obligations) \| performance_obligation		3
Remaining performance obligation revenue		$ 180.0
Roche and Genentech \| Collaborative Arrangement \| Phenomaps Creation
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Research project, fees and milestones payments receivable for an option on a lead series		$ 250.0
Number of eligible phenomaps (in phenomaps) \| phenomap		16
Roche and Genentech \| Collaborative Arrangement \| Phenomaps Raw Images
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Research project, fees and milestones payments receivable for an option on a lead series		$ 250.0
Number of eligible phenomaps (in phenomaps) \| phenomap		12
Roche and Genentech \| Collaborative Arrangement \| Developed and Commercialized Programs
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Research project, fees and milestones payments receivable for an option on a lead series		$ 300.0
Number of projects that may be initiated (in projects) \| program		40
Roche and Genentech \| Collaborative Arrangement \| Gastrointestinal Cancer
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Number of performance obligations under the agreement (in performance obligations) \| performance_obligation		1
Roche and Genentech \| Collaborative Arrangement \| Neuroscience
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Number of performance obligations under the agreement (in performance obligations) \| performance_obligation		2

Supplemental Financial Information - Schedule of Interest Income, Net (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023
Supplemental Financial Information [Abstract]
Interest income	$ 3,826	$ 4,977	$ 11,138	$ 14,594
Interest expense	(553)	(25)	(967)	(71)
Interest income, net	$ 3,273	$ 4,952	$ 10,171	$ 14,523

Leases - Narrative (Details) $ in Thousands	1 Months Ended			9 Months Ended
Leases - Narrative (Details) $ in Thousands	Sep. 30, 2024 USD ($) ft²	Feb. 29, 2024 ft²	Jan. 31, 2024 USD ($) ft²	Sep. 30, 2024 USD ($)	Sep. 30, 2023 USD ($)	May 31, 2024 USD ($) renewal_option	Apr. 30, 2024 USD ($)
Lessee, Lease, Description [Line Items]
Operating lease, renewal term	5 years			5 years
Increase (decrease) in operating lease right-of-use assets				$ (3,100)	$ 3,400
Increase (decrease) in operating lease liabilities				(3,100)	$ 3,400
Total lease payments	$ 79,120			79,120
Finance lease, fixed payment	$ 31,339			$ 31,339
Supercomputer
Lessee, Lease, Description [Line Items]
Finance lease, term of contract						3 years
Number of additional finance lease renewal options \| renewal_option						2
Finance lease, fixed payment						$ 34,000
New York Lease
Lessee, Lease, Description [Line Items]
Square footage of leased space (in square feet) \| ft²	11,655
Lease term	4 years			4 years
Total lease payments	$ 6,900			$ 6,900
Data Center Lease
Lessee, Lease, Description [Line Items]
Operating lease, renewal term							5 years
Square footage of leased space (in square feet) \| ft²		1,851
Lease term							5 years
Total lease payments							$ 13,000
London Lease
Lessee, Lease, Description [Line Items]
Operating lease, renewal term			5 years
Square footage of leased space (in square feet) \| ft²			6,792
Lease term			5 years
Total lease payments			$ 7,900
Minimum
Lessee, Lease, Description [Line Items]
Remaining operating lease term	1 year			1 year
Minimum \| Supercomputer
Lessee, Lease, Description [Line Items]
Finance lease, renewal term						1 year
Minimum \| New York Lease
Lessee, Lease, Description [Line Items]
Operating lease, renewal term	3 years			3 years
Maximum
Lessee, Lease, Description [Line Items]
Remaining operating lease term	8 years			8 years
Maximum \| Supercomputer
Lessee, Lease, Description [Line Items]
Finance lease, renewal term						2 years
Maximum \| New York Lease
Lessee, Lease, Description [Line Items]
Operating lease, renewal term	6 years			6 years

Stock-Based Compensation - Schedule of Stock Option Activity (Details) $ / shares in Units, $ in Thousands	9 Months Ended	12 Months Ended
	Sep. 30, 2024 USD ($) $ / shares shares	Dec. 31, 2023 USD ($) $ / shares shares
Shares
Options, outstanding, number at beginning of period (in shares) \| shares	14,957,617
Options, granted (in shares) \| shares	3,683,011
Options, cancelled (in shares) \| shares	538,803
Options, exercised (in shares) \| shares	2,542,832
Options, outstanding, number at end of period (in shares) \| shares	15,558,993	14,957,617
Options, exercisable (in shares) \| shares	9,409,685
Weighted-Average Exercise Price
Options, outstanding at beginning of period (in dollars per share) \| $ / shares	$ 6.13
Options, granted (in dollars per share) \| $ / shares	7.31
Options, cancelled (in dollars per share) \| $ / shares	11.91
Options, exercised (in dollars per share) \| $ / shares	2.53
Options, outstanding at end of period (in dollars per share) \| $ / shares	7.33	$ 6.13
Options, exercisable (in dollars per share) \| $ / shares	$ 6.28
Options, outstanding, weighted average remaining contractual life	7 years 1 month 6 days	7 years
Options, exercisable, weighted average remaining contractual life	6 years 1 month 6 days
Options, outstanding, intrinsic value \| $	$ 27,862	$ 72,416
Options, exercised in period, intrinsic value \| $	18,537
Options, exercisable, intrinsic value \| $	$ 26,068

Cover - shares	9 Months Ended
Cover - shares	Sep. 30, 2024	Oct. 31, 2024
Document Information [Line Items]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Sep. 30, 2024
Document Transition Report	false
Entity File Number	001-40323
Entity Registrant Name	RECURSION PHARMACEUTICALS, INC.
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	46-4099738
Entity Address, Address Line One	41 S Rio Grande Street
Entity Address, City or Town	Salt Lake City,
Entity Address, State or Province	UT
Entity Address, Postal Zip Code	84101
City Area Code	385
Local Phone Number	269 - 0203
Title of 12(b) Security	Class A Common Stock, par value $0.00001
Trading Symbol	RXRX
Security Exchange Name	NASDAQ
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Central Index Key	0001601830
Amendment Flag	false
Document Fiscal Year Focus	2024
Document Fiscal Period Focus	Q3
Current Fiscal Year End Date	--12-31
Class A Common Stock
Document Information [Line Items]
Entity Common Stock, Shares Outstanding		279,602,258
Class B Common Stock
Document Information [Line Items]
Entity Common Stock, Shares Outstanding		7,038,575

Basis of Presentation (Policies)	9 Months Ended
Basis of Presentation (Policies)	Sep. 30, 2024
Accounting Policies [Abstract]
Basis of Presentation	Basis of Presentation The unaudited interim condensed consolidated financial statements have been prepared pursuant to the rules and regulations of the U.S. Securities and Exchange Commission (SEC). Accordingly, certain information and footnote disclosures normally included in annual financial statements prepared in accordance with generally accepted accounting principles in the United States (U.S. GAAP) have been condensed or omitted. These unaudited interim condensed consolidated financial statements should be read in conjunction with the Company’s audited consolidated financial statements and notes for the year ended December 31, 2023. It is management’s opinion that these condensed consolidated financial statements include all normal and recurring adjustments necessary for a fair statement of the financial position, results of operations and cash flows for the periods presented. Revenue and net loss for any interim period are not necessarily indicative of future or annual results.
Recent Accounting Pronouncements	Recent Accounting Pronouncements In November 2024, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2024-03, Disaggregation of Income Statement Expenses (Topic 220). The standard requires new disclosures in the notes to the financial statements about certain caption expenses presented on the face of the Income Statement including information on: purchases of inventory; employee compensation; depreciation and intangible asset amortization. Recursion must also disclose a qualitative description of the amounts remaining in expense captions that are not separately disaggregated. This standard will be effective for Recursion starting the annual period ending December 31, 2027. Early adoption is permitted. The amendments can be applied on a prospective or retrospective basis. Recursion is currently assessing the impact of adopting this guidance on its consolidated financial statements. In March 2024, the SEC issued rule 33-11275, The Enhancement and Standardization of Climate-Related Disclosures for Investors. The new rule requires Recursion to provide certain disclosures in the footnotes to the financial statements of climate-related information. These disclosures include the impact of severe weather and other natural conditions on the Company’s consolidated balance sheet and statement of operations, to the extent they are material. Recursion will also need to disclose a rollforward of the beginning and ending balances of its carbon offsets and renewable energy credits or certificates (RECs), if they are a material component of meeting the Company’s climate-related targets and goals. Additionally, the Company will need to disclose whether and, if so, how severe weather events and other natural conditions and disclosed climate-related targets or transition plans materially affected estimates and assumptions in the financial statements. The final rule’s effective dates, if adopted, will be phased in depending on the disclosure requirement starting the annual period ending December 31, 2025. In April 2024, the SEC voluntarily stayed implementation of the new climate-related disclosure requirements pending judicial review. The Company is currently evaluating the impact this rule will have on its consolidated financial statements and related disclosures. In December 2023, the FASB issued ASU No. 2023-9, Income Taxes (Topic 740). The new standard updates disclosure requirements for Accounting Standards Codification (ASC) 740 primarily by requiring additional information in the income tax rate reconciliation and additional disclosures about income taxes paid. This standard will be effective for Recursion starting the annual period ending December 31, 2025. Early adoption is permitted for annual financial statements that have not yet been issued. The amendments can be applied on a prospective or retrospective basis. The adoption of this standard will not impact Recursion’s consolidated balance sheet and statement of operations. In November 2023, the FASB issued ASU No. 2023-7, Segment Reporting (Topic 280). The standard requires new disclosures related to ASC 280 including: disclosing significant segment expenses by category; requiring all the ASC 280 disclosures for companies with a single reportable segment and requiring ASC 280 disclosures for interim financial statements. Recursion must apply the amendments retrospectively to each prior reporting period presented. This standard will be effective for Recursion starting the annual period ending December 31, 2024. The adoption of this standard will not impact Recursion’s consolidated balance sheet and statement of operations.

Stock-Based Compensation

9 Months Ended

Sep. 30, 2024

Share-Based Payment Arrangement [Abstract]

Stock-Based Compensation

In April 2021, the Board of Directors and the stockholders of the Company adopted the 2021 Equity Incentive Plan (the 2021 Plan). The Company may grant stock options, restricted stock units (RSUs), stock appreciation rights, restricted stock awards and other forms of stock-based compensation. As of September 30, 2024, 12.5 million shares of Class A common stock were available for grant.

The following table presents the classification of stock-based compensation expense for employees and non-employees within the Condensed Consolidated Statements of Operations:


	Three months ended September 30,				Nine months ended September 30,
(in thousands)	2024		2023		2024		2023
Cost of revenue	$	1,153	$	2,123	$	2,600	$	4,549
Research and development	9,194		6,579		25,141		13,590
General and administrative	7,396		7,640		21,470		17,861
Total	$	17,743	$	16,342	$	49,211	$	36,000

Stock Options

Stock options are primarily granted to executive leaders at the Company, generally vest over four years and expire no later than 10 years from the date of grant.

Stock option activity during the nine months ended September 30, 2024 was as follows:


(in thousands except share data and per share amounts)	Shares	Weighted-Average Exercise Price		Weighted-Average Remaining Contractual Life (in years)	Aggregate Intrinsic Value
Outstanding as of December 31, 2023	14,957,617	$	6.13	7.0	$	72,416
Granted	3,683,011	7.31
Cancelled	538,803	11.91
Exercised	2,542,832	2.53			18,537
Outstanding as of September 30, 2024	15,558,993	$	7.33	7.1	$	27,862
Exercisable as of September 30, 2024	9,409,685	$	6.28	6.1	$	26,068

The fair value of options granted to employees is calculated on the grant date using the Black-Scholes option valuation model. The weighted-average grant-date fair values of stock options granted during the nine months ended September 30, 2024 and 2023 were $5.88 and $5.64, respectively.

The following weighted-average assumptions were used to calculate the grant-date fair value of stock options:


	Nine months ended September 30,
	2024		2023
Expected term (in years)	6.2		5.8
Expected volatility	65	%	66	%
Expected dividend yield	—		—
Risk-free interest rate	4.2	%	3.6	%

As of September 30, 2024, $38.2 million of unrecognized compensation cost related to stock options is expected to be recognized as expense over approximately the next two years.

RSUs

Equity awards granted to employees primarily consist of RSUs and generally vest over four years. The weighted-average grant-date fair value of RSUs generally is determined based on the number of units granted and the quoted price of Recursion’s common stock on the date of grant.

The following table summarizes Recursion’s RSU activity during the nine months ended September 30, 2024:


	Stock units	Weighted-average grant date fair value
Outstanding as of December 31, 2023	15,223,764	$	8.39
Granted	8,782,890	8.61
Vested	4,252,052	8.52
Forfeited	1,659,896	8.48
Outstanding as of September 30, 2024	18,094,706	$	8.46

The fair market value of RSUs vested was $39.3 million during the nine months ended September 30, 2024. As of September 30, 2024, $146.4 million of unrecognized compensation cost related to RSUs is expected to be recognized as expense over approximately the next three years.

Leases (Tables)

9 Months Ended

Sep. 30, 2024

Leases [Abstract]

Schedule of Components of Lease Cost and Supplemental Cash Flow Information Related to Leases and Lease Term and Discount Rates

The components of the lease cost were:


	Three months ended September 30,				Nine months ended September 30, 2024
(in thousands)	2024		2023		2024		2023
Operating lease cost	$	3,020	$	2,024	$	8,602	$	6,042
Finance lease cost:
Amortization of leased assets	1,460		—		2,445		—
Interest on lease liabilities	562		—		938		—
Variable lease cost	704		532		1,939		1,689
Short-term lease cost	77		66		159		107
Total lease cost	$	5,823	$	2,622	$	14,083	$	7,838

Supplemental cash flow information related to leases were:


	Nine months ended September 30,
(in thousands)	2024		2023
Cash paid for amount included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	10,742	$	7,950
Operating cash flows from financing leases	379		—
Financing cash flows from financing leases	2,261		—

Right-of-use assets additions and modifications:
Operating leases	$	19,455	$	4,324
Financing leases	29,342		—

Lease term and discount rates as of September 30, 2024 were:


	September 30, 2024
Operating leases
Weighted-average remaining lease term (years)	5.7
Weighted-average discount rate	7.9	%
Finance leases
Weighted-average remaining lease term (years)	2.8
Weighted-average discount rate	7.6	%

Schedule of Supplemental Balance Sheet Information Related to Leases

Supplemental balance sheet information related to leases were:


(in thousands)	September 30, 2024		December 31, 2023
Assets
Operating lease right-of-use assets	$	47,882	$	33,663
Financing lease right-of-use assets	26,897		—
Total lease right-of-use assets	$	74,779	$	33,663

Liabilities
Current liabilities
Notes payable and financing lease liabilities	$	8,145	$	—
Operating lease liabilities	8,233		6,116
Total current lease liabilities	16,378		6,116
Non-current liabilities
Notes payable and financing lease liabilities, non-current	19,495		—
Operating lease liabilities, non-current	53,663		43,414
Total non-current lease liabilities	73,158		43,414
Total lease liabilities	$	89,536	$	49,530

Schedule of Maturities of Operating Lease Liabilities

Maturities of lease liabilities as of September 30, 2024 were:


(in thousands)	Operating leases		Finance leases
Remainder of 2024	$	2,268	$	2,511
2025	14,585		10,046
2026	15,467		10,046
2027	15,914		8,736
2028	13,226		—
Thereafter	17,660		—
Total lease payments	79,120		31,339
Less amounts representing interest or imputed interest	(17,224)		(3,699)
Present value of lease liabilities	$	61,896	$	27,640

Schedule of Maturities of Finance Lease Liabilities

Maturities of lease liabilities as of September 30, 2024 were:


(in thousands)	Operating leases		Finance leases
Remainder of 2024	$	2,268	$	2,511
2025	14,585		10,046
2026	15,467		10,046
2027	15,914		8,736
2028	13,226		—
Thereafter	17,660		—
Total lease payments	79,120		31,339
Less amounts representing interest or imputed interest	(17,224)		(3,699)
Present value of lease liabilities	$	61,896	$	27,640

Fair Value Measurements - Schedule of Assets and Liabilities Measured at Fair Value on a Recurring Basis (Details) - Fair Value, Recurring - USD ($) $ in Thousands	Sep. 30, 2024	Dec. 31, 2023
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Restricted cash	$ 8,184	$ 9,860
Total assets	241,199	332,513
Money market funds
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Cash equivalents	233,015	322,653
Level 1
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Restricted cash	8,184	9,860
Total assets	241,199	332,513
Level 1 \| Money market funds
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Cash equivalents	233,015	322,653
Level 2
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Restricted cash	0	0
Total assets	0	0
Level 2 \| Money market funds
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Cash equivalents	0	0
Level 3
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Restricted cash	0	0
Total assets	0	0
Level 3 \| Money market funds
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Cash equivalents	$ 0	$ 0

Description of the Business	9 Months Ended
Description of the Business	Sep. 30, 2024
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Description of the Business	Description of the Business Recursion is a clinical stage TechBio company decoding biology to industrialize drug discovery. The Recursion Operating System (OS), a platform built across diverse technologies, enables the Company to map and navigate trillions of biological and chemical relationships within the Recursion Data Universe, one of the world’s largest proprietary biological and chemical datasets. The Company integrates physical and digital components as iterative loops of atoms and bits scaling wet lab biology and chemistry data organized into virtuous cycles with computational tools to rapidly translate in silico hypotheses into validated insights and novel chemistry. As of September 30, 2024, the Company had an accumulated deficit of $1.3 billion. The Company expects to incur substantial operating losses in future periods and will require additional capital to advance its drug candidates. The Company does not expect to generate significant revenue until the Company successfully completes significant drug development milestones with its subsidiaries or in collaboration with third parties, which the Company expects will take a number of years. In order to commercialize its drug candidates, the Company or its partners need to complete clinical development and comply with comprehensive regulatory requirements. The Company is subject to a number of risks and uncertainties similar to those of other companies of the same size within the biotechnology industry, such as the uncertainty of clinical trial outcomes, uncertainty of additional funding and a history of operating losses. The Company has funded its operations to date primarily through the issuance of Class A common stock (see Note 8, “Common Stock” for additional details). Additionally, the Company has received payments from its strategic partnerships (see Note 9, “Collaborative Development Contracts” for additional details). Recursion will likely be required to raise additional capital. As of September 30, 2024, the Company did not have any unconditional outstanding commitments for additional funding. If the Company is unable to access additional funds when needed, it may not be able to continue the development of its products or the Company could be required to delay, scale back or abandon some or all of its development programs and other operations. The Company’s ability to access capital when needed is not assured and, if not achieved on a timely basis, could materially harm its business, financial condition and results of operations. Recursion believes that the Company’s existing cash and cash equivalents will be sufficient to fund the Company’s operating expenses and capital expenditures for at least the next 12 months.

Stock-Based Compensation - Schedule of Stock-Based Compensation Expense (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Share-based payment arrangement, expense	$ 17,743	$ 16,342	$ 49,211	$ 36,000
Cost of revenue
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Share-based payment arrangement, expense	1,153	2,123	2,600	4,549
Research and development
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Share-based payment arrangement, expense	9,194	6,579	25,141	13,590
General and administrative
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Share-based payment arrangement, expense	$ 7,396	$ 7,640	$ 21,470	$ 17,861

Fair Value Measurements - Schedule of Financial Instruments Not Measured at Fair Value (Details) - USD ($) $ in Thousands	Sep. 30, 2024	Dec. 31, 2023
Fair Value Disclosure, Asset and Liability, Not Measured at Fair Value [Line Items]
Notes payable and financing lease liabilities, current	$ 8,219	$ 41
Notes payable and financing lease liabilities, non-current	20,510	1,101
Book values
Fair Value Disclosure, Asset and Liability, Not Measured at Fair Value [Line Items]
Total liabilities	28,729	1,142
Book values \| Notes Payable
Fair Value Disclosure, Asset and Liability, Not Measured at Fair Value [Line Items]
Notes payable and financing lease liabilities, current	8,219	41
Notes payable and financing lease liabilities, non-current	20,510	1,101
Fair values
Fair Value Disclosure, Asset and Liability, Not Measured at Fair Value [Line Items]
Total liabilities	28,729	1,142
Fair values \| Notes Payable
Fair Value Disclosure, Asset and Liability, Not Measured at Fair Value [Line Items]
Notes payable and financing lease liabilities, current	8,219	41
Notes payable and financing lease liabilities, non-current	$ 20,510	$ 1,101

Commitments and Contingencies (Details) - USD ($)	Sep. 30, 2024	Dec. 31, 2023
Commitments and Contingencies Disclosure [Abstract]
Loss contingency accrual	$ 0	$ 0
Finance leases, assets pledged as collateral	25,600,000
Finance lease liability	$ 27,640,000

Acquisitions - Schedule of Pro Forma Financial Information (Details) - Recursion, Valence and Cyclica - USD ($) $ in Thousands	3 Months Ended	9 Months Ended
	Sep. 30, 2023	Sep. 30, 2023
Business Acquisition [Line Items]
Net revenue	$ 10,534	$ 33,970
Net loss	$ (92,553)	$ (245,391)

Acquisitions - Narrative (Details) - USD ($) $ in Millions					9 Months Ended
Acquisitions - Narrative (Details) - USD ($) $ in Millions	Sep. 30, 2024	Aug. 08, 2024	May 25, 2023	May 16, 2023	Sep. 30, 2024	Sep. 30, 2023
Exscientia Plc \| Class A Common Stock
Business Acquisition [Line Items]
Shares of acquirer stock per share of acquiree stock outstanding (in shares)		0.7729
Valence Discovery Inc
Business Acquisition [Line Items]
Operating loss					$ 9.3
Valence Discovery Inc \| Technology Intangible Assets
Business Acquisition [Line Items]
Useful life				4 years
Valence Discovery Inc \| Stock Options
Business Acquisition [Line Items]
Equity interest issued or issuable (in shares)				792,000
Valence Discovery Inc \| Class A Common Stock
Business Acquisition [Line Items]
Equity interest issued or issuable (in shares)				2,200,000
Valence Discovery Inc \| Exchangeable Stock
Business Acquisition [Line Items]
Equity interest issued or issuable (in shares)				4,400,000
Cyclica Inc
Business Acquisition [Line Items]
Operating loss					$ 11.2	$ 6.0
Cyclica Inc \| Technology Intangible Assets
Business Acquisition [Line Items]
Useful life			3 years
Cyclica Inc \| Stock Options
Business Acquisition [Line Items]
Equity interest issued or issuable (in shares)			1,000,000.0
Cyclica Inc \| Class A Common Stock
Business Acquisition [Line Items]
Equity interest issued or issuable (in shares)	172,000		5,800,000

Condensed Consolidated Balance Sheets (unaudited) - USD ($) $ in Thousands	Sep. 30, 2024	Dec. 31, 2023
Current assets
Cash and cash equivalents	$ 427,647	$ 391,565
Restricted cash	1,555	3,231
Other receivables	2,255	3,094
Other current assets	42,715	40,247
Total current assets	474,172	438,137
Restricted cash, non-current	6,629	6,629
Property and equipment, net	84,410	86,510
Operating lease right-of-use assets	47,882	33,663
Financing lease right-of-use assets	26,897	0
Intangible assets, net	34,093	36,443
Goodwill	52,056	52,056
Other assets, non-current	360	261
Total assets	726,499	653,699
Current liabilities
Accounts payable	2,260	3,953
Accrued expenses and other liabilities	40,597	46,635
Unearned revenue	49,579	36,426
Operating lease liabilities	8,233	6,116
Notes payable and financing lease liabilities	8,219	41
Total current liabilities	108,888	93,171
Unearned revenue, non-current	15,712	51,238
Operating lease liabilities, non-current	53,663	43,414
Notes payable and financing lease liabilities, non-current	20,510	1,101
Deferred tax liabilities	168	1,339
Other liabilities, non-current	2,999	0
Total liabilities	201,940	190,263
Commitments and contingencies (Note 7)
Stockholders’ equity
Common stock, $0.00001 par value; 2,000,000,000 shares (Class A 1,989,032,117 and Class B 10,967,883) authorized as of September 30, 2024 and December 31, 2023; 286,124,279 shares (Class A 278,848,301, Class B 7,078,575 and Exchangeable 197,403) and 234,270,384 shares (Class A 226,264,764, Class B 7,544,871 and Exchangeable 460,749) issued and outstanding as of September 30, 2024 and December 31, 2023, respectively	3	2
Additional paid-in capital	1,776,933	1,431,056
Accumulated deficit	(1,252,377)	(967,622)
Total stockholders’ equity	524,559	463,436
Total liabilities and stockholders’ equity	$ 726,499	$ 653,699

Goodwill and Intangible Assets - Narrative (Details) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023
Goodwill [Line Items]
Increase (decrease) in carrying amount of goodwill	$ 0		$ 0
Goodwill impairment	0	$ 0	0	$ 0
Amortization expense	4,100,000	3,400,000	11,300,000	5,100,000
Impairment of indefinite-lived intangible assets	$ 0	$ 0	$ 0	0
Licensing Agreements
Goodwill [Line Items]
Useful life	3 years		3 years
Annual payment for intangible assets			$ 3,000,000.0
Annual payment for intangible assets, total			$ 9,000,000.0
Cyclica and Valence
Goodwill [Line Items]
Increase (decrease) in carrying amount of goodwill				$ 51,300,000

Leases - Schedule of Components of Lease Cost (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023
Leases [Abstract]
Operating lease cost	$ 3,020	$ 2,024	$ 8,602	$ 6,042
Amortization of leased assets	1,460	0	2,445	0
Interest on lease liabilities	562	0	938	0
Variable lease cost	704	532	1,939	1,689
Short-term lease cost	77	66	159	107
Total lease cost	$ 5,823	$ 2,622	$ 14,083	$ 7,838

Common Stock (Details) $ / shares in Units, shares in Millions		1 Months Ended			9 Months Ended
	Jun. 28, 2024 USD ($) $ / shares shares	Aug. 31, 2023 USD ($)	Jul. 31, 2023 USD ($) $ / shares shares	May 31, 2023 shares	Sep. 30, 2024 USD ($) vote shares	Oct. 31, 2022	Apr. 30, 2021 class
Class of Stock [Line Items]
Percent of aggregate purchase price paid by the holder due if agreement is broken						1.00%
Registration rights agreement, accrued liability					$ 0
Number of classes of common stock authorized \| class							2
CEO and Affiliates
Class of Stock [Line Items]
Affiliated holders, ownership percentage					0.20
Affiliated holders, potential ownership percentage when outstanding equity awards vest					0.20
Valence Discovery Inc
Class of Stock [Line Items]
Registration rights agreement term				3 years
Public Offering of Common Stock
Class of Stock [Line Items]
Sale of stock, underwriters option period from the date of the agreement	30 days
NVDIA Private Placement
Class of Stock [Line Items]
Percent of aggregate purchase price paid by the holder due if agreement is broken		1.00%
Registration rights agreement, accrued liability					$ 0
NVDIA Private Placement \| Maximum
Class of Stock [Line Items]
Percent of aggregate purchase price paid by the holder due if agreement is broken		5.00%
Class A Common Stock
Class of Stock [Line Items]
Vote per share of common stock (in votes) \| vote					1
Common stock, conversion ratio				1	1
Class A Common Stock \| Public Offering of Common Stock
Class of Stock [Line Items]
Number of shares issued (in shares) \| shares	35.4
Price per share (in dollars per share) \| $ / shares	$ 6.50
Net proceeds received	$ 216,400,000
Underwriting discounts and commissions	$ 13,600,000
Class A Common Stock \| Public Offering of Common Stock, Underwriting Agreement
Class of Stock [Line Items]
Number of shares issued (in shares) \| shares	30.8
Class A Common Stock \| Over-Allotment Option
Class of Stock [Line Items]
Number of shares issued (in shares) \| shares	4.6
Class A Common Stock \| At-the-Market Offering Program
Class of Stock [Line Items]
Number of shares issued (in shares) \| shares					8.4
Net proceeds received					$ 72,900,000
Sale of stock, value authorized		$ 300,000,000.0
Sale of stock, value remaining authorized					$ 144,300,000
Sale of stock, percentage of commission					3.00%
Class A Common Stock \| NVDIA Private Placement
Class of Stock [Line Items]
Common stock sales issuances, net of issuance costs (in shares) \| shares			7.7
Shares issued, price per share (in USD per share) \| $ / shares			$ 6.49
Proceeds from issuance of private placement			$ 49,900,000
Class B Common Stock
Class of Stock [Line Items]
Vote per share of common stock (in votes) \| vote					10
Exchangeable Stock
Class of Stock [Line Items]
Shares issued in the period, upon conversion (in shares) \| shares					4.9
Exchangeable Stock \| Valence Discovery Inc
Class of Stock [Line Items]
Equity interest issued or issuable (in shares) \| shares				5.9

Commitments and Contingencies	9 Months Ended
Commitments and Contingencies	Sep. 30, 2024
Commitments and Contingencies Disclosure [Abstract]
Commitments and Contingencies	Commitments and Contingencies Contract Obligations In the normal course of business, the Company enters into contracts with clinical research organizations, drug manufacturers and other vendors for preclinical and clinical research studies, research and development supplies and other services and products for operating purposes. These contracts generally provide for termination on notice and are cancellable contracts. Indemnification The Company has agreed to indemnify its officers and directors for certain events or occurrences, while the officer or director is or was serving at the Company’s request in such capacity. The Company purchases directors and officers liability insurance coverage that provides for reimbursement to the Company for covered obligations and this is intended to limit the Company’s exposure and enable it to recover a portion of any amounts it pays under its indemnification obligations. The Company had no liabilities recorded for these agreements as of September 30, 2024 and December 31, 2023, as no amounts were probable. Employee Agreements The Company has signed employment agreements with certain key employees pursuant to which, if their employment is terminated following a change of control of the Company, the employees are entitled to receive certain benefits, including accelerated vesting of equity incentives. Legal Matters The Company may, from time to time, be involved in various legal proceedings arising in the normal course of business. An unfavorable resolution of any such matter could materially affect the Company’s future financial position, results of operations or cash flows. In February 2021, the Company entered into a lease agreement for laboratory and office space (the Industry Lease) with Industry Office SLC, LLC (the landlord). In March 2023, the Company sent a letter to the landlord detailing numerous construction delays and irregularities, deficiencies and deviations from applicable structural drawings and/or non-conforming conditions with applicable building codes. On June 23, 2023, the landlord filed a lawsuit against the Company (Industry Office SLC, LLC v. Recursion Pharmaceuticals, Inc., Case No. 230904627) in the Third District Court for Salt Lake County, State of Utah (the Court), alleging anticipatory repudiation and breach of contract. The Plaintiff seeks monetary damages and attorney’s fees. As of September 30, 2024, the Company had no liability recorded for these events as an unfavorable outcome was not probable. In connection with the Industry Lease, in September 2023, the Company filed counterclaims in the Court against the landlord alleging, among other things, breach of contract and fraudulent misrepresentation (the Counterclaims). Also in September 2023, the Court dismissed the landlord’s complaint without prejudice. In October 2023, the landlord filed an amended complaint and also an answer to Recursion’s Counterclaims, denying the Company’s allegations. The Company and the landlord are currently engaged in discovery. In September 2024, the Court granted Recursion’s motion to amend its Counterclaims to assert claims for alter ego and agency liability against several allegedly controlling parent companies associated with the landlord. The Company is presently unable to estimate the possible amount or range of damages associated with the Counterclaims, as expert discovery associated with these issues has not yet occurred. Pledged Assets As of September 30, 2024, assets pledged as collateral against finance leases totaled $25.6 million. Assets pledged as collateral are Lab Equipment reported in “Property and Equipment, net” on the Condensed Consolidated Balance Sheet. As of September 30, 2024, the liabilities associated with collateral pledged were solely comprised of a finance lease and had a carrying value of $27.6 million. The collateral pledged under the lease agreement may only be operated by the Company within the continental United States and must maintain a good title. The assets cannot be sold, disposed of or repledged by the Company.

Stock-Based Compensation - Schedule of RSU Activity (Details) - RSUs	9 Months Ended
	Sep. 30, 2024 $ / shares shares
Stock units
Beginning balance, outstanding (in shares) \| shares	15,223,764
Granted (in shares) \| shares	8,782,890
Vested (in shares) \| shares	4,252,052
Forfeited (in shares) \| shares	1,659,896
Ending balance, outstanding (in shares) \| shares	18,094,706
Weighted-average grant date fair value
Beginning balance, outstanding (in dollars per share) \| $ / shares	$ 8.39
Granted (in dollars per share) \| $ / shares	8.61
Vested (in dollars per share) \| $ / shares	8.52
Forfeited (in dollars per share) \| $ / shares	8.48
Ending balance, outstanding (in dollars per share) \| $ / shares	$ 8.46

Net Loss Per Share (Tables)

9 Months Ended

Sep. 30, 2024

Earnings Per Share [Abstract]

Schedule of Computation of Basic and Diluted Net Loss Per Share

The following tables set forth the computation of basic and diluted net loss per share of Class A, Class B and Exchangeable common stock:


	Three months ended September 30,				Nine months ended September 30,
(in thousands, except share amounts)	2024		2023		2024		2023
Numerator:
Net loss	$	(95,842)	$	(93,017)	$	(284,755)	$	(235,070)
Denominator:
Weighted average common shares outstanding	282,583,048		214,327,186		253,447,099		203,090,637
Net loss per share, basic and diluted	$	(0.34)	$	(0.43)	$	(1.12)	$	(1.16)

Schedule of Antidilutive Securities Excluded from Computation of Net Loss Per Share

The Company excluded the following potential common shares from the computation of diluted net loss per share for the periods indicated because including them would have had an anti-dilutive effect:


	Three months ended September 30,		Nine months ended September 30,
	2024	2023	2024	2023
Stock based compensation	5,869,795	12,162,449	8,098,979	9,022,502
Tempus agreement	6,694,934	—	6,694,934	—
Total	12,564,729	12,162,449	14,793,913	9,022,502

Leases - Schedule of Supplemental Balance Sheet Information Related to Leases (Details) - USD ($) $ in Thousands	Sep. 30, 2024	Dec. 31, 2023
Assets
Operating lease right-of-use assets	$ 47,882	$ 33,663
Financing lease right-of-use assets	26,897	0
Total lease right-of-use assets	74,779	33,663
Current liabilities
Notes payable and financing lease liabilities	8,145	0
Operating lease liabilities	8,233	6,116
Total current lease liabilities	16,378	6,116
Non-current liabilities
Notes payable and financing lease liabilities, non-current	19,495	0
Operating lease liabilities, non-current	53,663	43,414
Total non-current lease liabilities	73,158	43,414
Total lease liabilities	$ 89,536	$ 49,530

Leases - Schedule of Supplemental Cash Flow Information Related to Leases (Details) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023
Cash paid for amount included in the measurement of lease liabilities:
Operating cash flows from operating leases	$ 10,742	$ 7,950
Operating cash flows from financing leases	379	0
Financing cash flows from financing leases	2,261	0
Right-of-use assets additions and modifications:
Operating leases	19,455	4,324
Financing leases	$ 29,342	$ 0

Basis of Presentation	9 Months Ended
Basis of Presentation	Sep. 30, 2024
Accounting Policies [Abstract]
Basis of Presentation	Basis of Presentation Basis of Presentation The unaudited interim condensed consolidated financial statements have been prepared pursuant to the rules and regulations of the U.S. Securities and Exchange Commission (SEC). Accordingly, certain information and footnote disclosures normally included in annual financial statements prepared in accordance with generally accepted accounting principles in the United States (U.S. GAAP) have been condensed or omitted. These unaudited interim condensed consolidated financial statements should be read in conjunction with the Company’s audited consolidated financial statements and notes for the year ended December 31, 2023. It is management’s opinion that these condensed consolidated financial statements include all normal and recurring adjustments necessary for a fair statement of the financial position, results of operations and cash flows for the periods presented. Revenue and net loss for any interim period are not necessarily indicative of future or annual results. Recent Accounting Pronouncements In November 2024, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2024-03, Disaggregation of Income Statement Expenses (Topic 220). The standard requires new disclosures in the notes to the financial statements about certain caption expenses presented on the face of the Income Statement including information on: purchases of inventory; employee compensation; depreciation and intangible asset amortization. Recursion must also disclose a qualitative description of the amounts remaining in expense captions that are not separately disaggregated. This standard will be effective for Recursion starting the annual period ending December 31, 2027. Early adoption is permitted. The amendments can be applied on a prospective or retrospective basis. Recursion is currently assessing the impact of adopting this guidance on its consolidated financial statements. In March 2024, the SEC issued rule 33-11275, The Enhancement and Standardization of Climate-Related Disclosures for Investors. The new rule requires Recursion to provide certain disclosures in the footnotes to the financial statements of climate-related information. These disclosures include the impact of severe weather and other natural conditions on the Company’s consolidated balance sheet and statement of operations, to the extent they are material. Recursion will also need to disclose a rollforward of the beginning and ending balances of its carbon offsets and renewable energy credits or certificates (RECs), if they are a material component of meeting the Company’s climate-related targets and goals. Additionally, the Company will need to disclose whether and, if so, how severe weather events and other natural conditions and disclosed climate-related targets or transition plans materially affected estimates and assumptions in the financial statements. The final rule’s effective dates, if adopted, will be phased in depending on the disclosure requirement starting the annual period ending December 31, 2025. In April 2024, the SEC voluntarily stayed implementation of the new climate-related disclosure requirements pending judicial review. The Company is currently evaluating the impact this rule will have on its consolidated financial statements and related disclosures. In December 2023, the FASB issued ASU No. 2023-9, Income Taxes (Topic 740). The new standard updates disclosure requirements for Accounting Standards Codification (ASC) 740 primarily by requiring additional information in the income tax rate reconciliation and additional disclosures about income taxes paid. This standard will be effective for Recursion starting the annual period ending December 31, 2025. Early adoption is permitted for annual financial statements that have not yet been issued. The amendments can be applied on a prospective or retrospective basis. The adoption of this standard will not impact Recursion’s consolidated balance sheet and statement of operations. In November 2023, the FASB issued ASU No. 2023-7, Segment Reporting (Topic 280). The standard requires new disclosures related to ASC 280 including: disclosing significant segment expenses by category; requiring all the ASC 280 disclosures for companies with a single reportable segment and requiring ASC 280 disclosures for interim financial statements. Recursion must apply the amendments retrospectively to each prior reporting period presented. This standard will be effective for Recursion starting the annual period ending December 31, 2024. The adoption of this standard will not impact Recursion’s consolidated balance sheet and statement of operations.

Stock-Based Compensation (Tables)

9 Months Ended

Sep. 30, 2024

Share-Based Payment Arrangement [Abstract]

Schedule of Stock-Based Compensation Expense

The following table presents the classification of stock-based compensation expense for employees and non-employees within the Condensed Consolidated Statements of Operations:


	Three months ended September 30,				Nine months ended September 30,
(in thousands)	2024		2023		2024		2023
Cost of revenue	$	1,153	$	2,123	$	2,600	$	4,549
Research and development	9,194		6,579		25,141		13,590
General and administrative	7,396		7,640		21,470		17,861
Total	$	17,743	$	16,342	$	49,211	$	36,000

Schedule of Stock Option Activity

Stock option activity during the nine months ended September 30, 2024 was as follows:


(in thousands except share data and per share amounts)	Shares	Weighted-Average Exercise Price		Weighted-Average Remaining Contractual Life (in years)	Aggregate Intrinsic Value
Outstanding as of December 31, 2023	14,957,617	$	6.13	7.0	$	72,416
Granted	3,683,011	7.31
Cancelled	538,803	11.91
Exercised	2,542,832	2.53			18,537
Outstanding as of September 30, 2024	15,558,993	$	7.33	7.1	$	27,862
Exercisable as of September 30, 2024	9,409,685	$	6.28	6.1	$	26,068

Schedule of Weighted-Average Assumptions Used to Calculate Grant-Date Fair Value of Stock Options

The following weighted-average assumptions were used to calculate the grant-date fair value of stock options:


	Nine months ended September 30,
	2024		2023
Expected term (in years)	6.2		5.8
Expected volatility	65	%	66	%
Expected dividend yield	—		—
Risk-free interest rate	4.2	%	3.6	%

Schedule of RSU Activity

The following table summarizes Recursion’s RSU activity during the nine months ended September 30, 2024:


	Stock units	Weighted-average grant date fair value
Outstanding as of December 31, 2023	15,223,764	$	8.39
Granted	8,782,890	8.61
Vested	4,252,052	8.52
Forfeited	1,659,896	8.48
Outstanding as of September 30, 2024	18,094,706	$	8.46

Fair Value Measurements

9 Months Ended

Sep. 30, 2024

Fair Value Disclosures [Abstract]

Fair Value Measurements

The fair value hierarchy consists of the following three levels:

•Level 1 — Valuations based on unadjusted quoted prices in active markets for identical assets that the company has the ability to access;

•Level 2 — Valuations based on quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active and model-based valuations in which all significant inputs are observable in the market; and

•Level 3 — Valuations using significant inputs that are unobservable in the market and include the use of judgment by the company's management about the assumptions market participants would use in pricing the asset or liability.

The Company is required to maintain a cash balance in a collateralized account to secure the Company’s credit cards. Additionally, the Company holds restricted cash related to an outstanding letter of credit issued by J.P. Morgan, which was obtained to secure certain Company obligations relating to tenant improvements.

The following tables summarize the Company’s assets and liabilities that are measured at fair value on a recurring basis:


			Basis of fair value measurement
(in thousands)	September 30, 2024		Level 1		Level 2		Level 3
Assets
Cash equivalents:
Money market funds	$	233,015	$	233,015	$	—	$	—
Restricted cash	8,184		8,184		—		—
Total assets	$	241,199	$	241,199	$	—	$	—


			Basis of fair value measurement
(in thousands)	December 31, 2023		Level 1		Level 2		Level 3
Assets
Cash equivalents:
Money market funds	$	322,653	$	322,653	$	—	$	—
Restricted cash	9,860		9,860		—		—
Total assets	$	332,513	$	332,513	$	—	$	—

In addition to the financial instruments that are recognized at fair value on the Condensed Consolidated Balance Sheet, the Company has certain financial instruments that are recognized at amortized cost or some basis other than fair value. The carrying amount of these instruments are considered to be representative of their approximate fair values.

The following tables summarize the Company’s financial instruments that are not measured at fair value:


	Book values				Fair values
(in thousands)	September 30, 2024		December 31, 2023		September 30, 2024		December 31, 2023
Liabilities
Notes payable and financing lease liabilities, current	$	8,219	$	41	$	8,219	$	41
Notes payable and financing lease liabilities, non-current	20,510		1,101		20,510		1,101
Total liabilities	$	28,729	$	1,142	$	28,729	$	1,142

- Definition

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

+ References

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+ Details

Supplemental Financial Information - Narrative (Details) - USD ($) $ in Millions	1 Months Ended	3 Months Ended		9 Months Ended
	Nov. 30, 2023	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023
Property, Plant and Equipment [Line Items]
Depreciation		$ 4.0	$ 4.2	$ 12.1	$ 11.7
Asset impairment				0.0	$ 1.2
Other Current Assets
Property, Plant and Equipment [Line Items]
License agreement, prepaid expenses		$ 13.1		$ 13.1
Tempus Labs, Inc
Property, Plant and Equipment [Line Items]
License agreement term	5 years
Trading period used for equity value determination	7 days
Business days prior to the payment date	5 days
Tempus Labs, Inc \| Minimum
Property, Plant and Equipment [Line Items]
Annual payments	$ 22.0
Tempus Labs, Inc \| Maximum
Property, Plant and Equipment [Line Items]
Annual payments	42.0
Aggregate payments	$ 160.0

Condensed Consolidated Statements of Stockholders’ Equity (unaudited) - USD ($) $ in Thousands	Total	Common Stock (Class A, B and Exchangeable)	Additional Paid-in-Capital	Accumulated Deficit
Beginning balance (in shares) at Dec. 31, 2022		191,022,864
Beginning balance at Dec. 31, 2022	$ 485,806	$ 2	$ 1,125,360	$ (639,556)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net loss	(235,070)			(235,070)
Stock option exercises and other (in shares)		6,417,024
Stock option exercises and other	8,789		8,789
Stock-based compensation	37,417		37,417
Common stock sales issuances, net of issuance costs (in shares)		18,873,794
Common stock sales issuances, net of issuance costs	141,025		141,025
Ending balance (in shares) at Sep. 30, 2023		216,313,682
Ending balance at Sep. 30, 2023	437,967	$ 2	1,312,591	(874,626)
Beginning balance (in shares) at Jun. 30, 2023		206,737,332
Beginning balance at Jun. 30, 2023	468,963	$ 2	1,250,570	(781,609)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net loss	(93,017)			(93,017)
Stock option exercises and other (in shares)		2,814,903
Stock option exercises and other	2,995		2,995
Stock-based compensation	16,792		16,792
Common stock sales issuances, net of issuance costs (in shares)		6,761,447
Common stock sales issuances, net of issuance costs	42,234		42,234
Ending balance (in shares) at Sep. 30, 2023		216,313,682
Ending balance at Sep. 30, 2023	$ 437,967	$ 2	1,312,591	(874,626)
Beginning balance (in shares) at Dec. 31, 2023	234,270,384	234,270,384
Beginning balance at Dec. 31, 2023	$ 463,436	$ 2	1,431,056	(967,622)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net loss	$ (284,755)			(284,755)
Stock option exercises and other (in shares)	2,542,832	7,827,268
Stock option exercises and other	$ 5,586		5,586
Stock-based compensation	50,904		50,904
Common stock sales issuances, net of issuance costs (in shares)		44,026,627
Common stock sales issuances, net of issuance costs	$ 289,388	$ 1	289,387
Ending balance (in shares) at Sep. 30, 2024	286,124,279	286,124,279
Ending balance at Sep. 30, 2024	$ 524,559	$ 3	1,776,933	(1,252,377)
Beginning balance (in shares) at Jun. 30, 2024		280,968,276
Beginning balance at Jun. 30, 2024	584,449	$ 3	1,740,981	(1,156,535)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net loss	(95,842)			(95,842)
Stock option exercises and other (in shares)		2,689,679
Stock option exercises and other	732		732
Stock-based compensation	18,252		18,252
Common stock sales issuances, net of issuance costs (in shares)		2,466,324
Common stock sales issuances, net of issuance costs	$ 16,968		16,968
Ending balance (in shares) at Sep. 30, 2024	286,124,279	286,124,279
Ending balance at Sep. 30, 2024	$ 524,559	$ 3	$ 1,776,933	$ (1,252,377)

- Definition

The portion of profit or loss for the period, net of income taxes, which is attributable to the parent.

+ References

+ Details

- Definition

Equity impact of the value of new stock issued during the period. Includes shares issued in an initial public offering or a secondary public offering.

+ References + Details

- Definition

Amount of equity (deficit) attributable to parent. Excludes temporary equity and equity attributable to noncontrolling interest.

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-URI https://asc.fasb.org/1943274/2147479134/946-220-S99-3

Reference 11: http://www.xbrl.org/2009/role/commonPracticeRef
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-Paragraph 1
-Subparagraph (SX 210.4-08(g)(1)(ii))
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Reference 12: http://www.xbrl.org/2009/role/commonPracticeRef
-Topic 323
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-Section 50
-Paragraph 3
-Subparagraph (c)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147481687/323-10-50-3

Reference 13: http://www.xbrl.org/2009/role/commonPracticeRef
-Topic 825
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 28
-Subparagraph (f)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482907/825-10-50-28

Reference 14: http://fasb.org/us-gaap/role/ref/legacyRef
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-Paragraph 2
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-URI https://asc.fasb.org/1943274/2147480418/310-10-S99-2

+ Details

Acquisitions

9 Months Ended

Sep. 30, 2024

Business Combination, Asset Acquisition, and Joint Venture Formation [Abstract]

Acquisitions

Exscientia Plc

On August 8, 2024, the Company signed an agreement with Exscientia plc (“Exscientia”) to acquire all of the issued and to be issued share capital of Exscientia in exchange for shares of Class A common stock of the Company (the “Transaction Agreement”). The Transaction Agreement has a fixed exchange ratio whereby each ordinary share of Exscientia will be exchanged for 0.7729 shares of Class A common stock of the Company on the closing date. Recursion will also assume the outstanding stock-based compensation awards of Exscientia. The closing of the transaction is subject to the satisfaction or waiver of a number of conditions, including the requisite approval of each of the Company’s stockholders and Exscientia’s shareholders, sanction by the High Court of Justice of England and Wales, and other closing conditions that are customary for transactions of this nature.

Valence Discovery Inc.

On May 16, 2023, Recursion acquired all of the outstanding equity interests in Valence Discovery Inc. (Valence), a privately-held machine learning (ML) / artificial intelligence (AI) digital chemistry company. The integration of Valence’s AI-based chemistry engine into Recursion’s operating system will allow Recursion to expand its technology-enabled drug discovery process. This will accelerate Recursion’s digital chemistry capabilities and its drug discovery process.

The acquisition of Valence was accounted for as a business combination using the acquisition method of accounting. The aggregate upfront consideration for the acquisition of Valence consisted of 2.2 million shares of Recursion Class A common stock, 4.4 million shares of a subsidiary of Recursion, exchangeable for shares of Recursion’s Class A common stock, 792 thousand shares issuable upon exercise of stock options held by Valence equity award holders and deferred liabilities for additional consideration.

The following table summarizes total consideration:


(in thousands)
Fair value of Recursion Class A common stock	$	11,096
Fair value of Exchangeable stock	22,473
Fair value of equity awards issued to Valance equity award holders	1,933
Deferred liabilities for additional consideration	396
Total consideration	$	35,898

The following table summarizes the fair value of assets acquired and liabilities assumed as of the acquisition date:


(in thousands)
Cash	$	4,235
Other receivables	536
Intangible asset - technology	15,000
Accounts payable and accrued liabilities	(872)
Deferred income taxes	(3,265)
Total identifiable net assets	15,634
Goodwill	20,264
Total assets acquired and liabilities assumed	$	35,898

The intangible asset is related to Valence’s ML and AI digital chemistry platform. The estimated fair value of the intangible asset was determined using a cost approach. This valuation technique provides the fair value of an asset based on estimates of the total costs to develop the technology. Significant inputs used to determine the total cost includes the length of time required and service hours performed by Company employees. The technology intangible asset is being amortized on a straight-line basis over its four-year useful life.

Goodwill was calculated as the excess of the consideration transferred over the net assets recognized. The goodwill recognized represents the assembled workforce and expected synergies, including the ability to: (i) leverage Valence’s digital chemistry platform across Recursion’s business; (ii) leverage Valence’s ML and AI capabilities; (iii) integrate Recursion’s data and operating system into Valence’s platform; and (iv) accelerate Recursion’s pipeline. Goodwill was also impacted by the establishment of a deferred tax liability for the acquired identifiable intangible assets which have no tax basis. The goodwill is not deductible for tax purposes.

Recursion’s condensed consolidated statement of operations during the nine months ended September 30, 2024 included immaterial net revenue and a $9.3 million operating loss associated with Valence’s operations. The Company has finalized the amounts recognized disclosed in the above tables.

Cyclica Inc.

On May 25, 2023, Recursion acquired all of the outstanding equity interests in Cyclica Inc. (Cyclica), a privately-held Company that has built a digital chemistry software suite which enables mechanism of action deconvolution and generative chemistry suggestions based on desired targets. Cyclica’s platform is expected to enhance the optimization of Recursion’s compounds for efficacy while minimizing liabilities through generative machine learning approaches.

The acquisition of Cyclica was accounted for as a business combination using the acquisition method of accounting. The aggregate upfront consideration for the acquisition of Cyclica consisted of 5.8 million shares of Recursion Class A common stock, cash payments, 1.0 million shares issuable upon exercise of stock options held by Cyclica equity award holders and deferred liabilities for additional consideration. Approximately 172 thousand of the aforementioned shares of Class A common stock consideration had not yet been issued as of September 30, 2024.

The following table summarizes total consideration:


(in thousands)
Fair value of Recursion Class A common stock	$	49,915
Cash	6,505
Fair value of equity awards issued to Cyclica equity award holders	3,852
Deferred liabilities for additional consideration	345
Total consideration	$	60,617

The following table summarizes the fair value of assets acquired and liabilities assumed as of the acquisition date:


(in thousands)
Cash	$	2,429
Restricted cash	1,685
Other receivables	741
Investments	1,000
Other current assets	385
Intangible assets - technology	28,000
Accounts payable and accrued liabilities	(579)
Unearned revenue	(1,754)
Deferred income taxes	(2,075)
Other liabilities, current	(66)
Other liabilities, non-current	(139)
Total identifiable net assets	29,627
Goodwill	30,990
Total assets acquired and liabilities assumed	$	60,617

The intangible assets are related to Cyclica’s digital chemistry platforms. The estimated fair value of the intangible assets was determined using a cost approach. This valuation technique provides the fair value of an asset based on estimates of the total costs to develop the technology. Significant inputs used to determine the total cost includes the length of time required and service hours performed by Company employees. The technology intangible assets are being amortized on a straight-line basis over their three-year useful lives.

Goodwill was calculated as the excess of the consideration transferred over the net assets recognized. The goodwill recognized represents the assembled workforce and expected synergies, including the ability to: (i) leverage Cyclica’s digital chemistry platform across Recursion’s business; (ii) leverage Cyclica’s ML and AI capabilities; (iii) integrate Recursion’s data and operating system into Cyclica’s platform; and (iv) accelerate Recursion’s pipeline. Goodwill was also impacted by the establishment of a deferred tax liability for the acquired identifiable intangible assets. The goodwill is not deductible for tax purposes.

Recursion’s condensed consolidated statement of operations during the nine months ended September 30, 2024 included immaterial net revenue and a $11.2 million operating loss associated with Cyclica’s operations. Recursion’s condensed consolidated statement of operations for the nine months ended September 30, 2023 included immaterial net revenue and a $6.0 million operating loss associated with Cyclica’s operations. The Company has finalized the amounts recognized disclosed in the above tables.

Pro forma financial information

The following table presents the unaudited pro forma combined results of operations of Recursion, Valence and Cyclica as if the acquisitions had occurred on January 1, 2022:


(in thousands)	Three months ended September 30, 2023		Nine Months Ended September 30, 2023
Net revenue	$	10,534	$	33,970
Net loss	(92,553)		(245,391)

The unaudited pro forma financial information was prepared using the acquisition method of accounting and was based on the historical financial information of Recursion, Valence and Cyclica. In order to reflect the occurrence of the acquisitions on January 1, 2022 as required, the unaudited pro forma financial information includes adjustments to reflect the incremental amortization expense to be incurred based on the fair values of the identifiable intangible

assets acquired and the additional stock compensation expense associated with the issuance of equity compensation related to the acquisitions. The unaudited pro forma financial information is not necessarily indicative of what the consolidated results of operations would have been had the acquisitions been completed on January 1, 2022. In addition, the unaudited pro forma financial information is not a projection of the future results of operations of the combined company nor does it reflect the expected realization of any cost savings or synergies associated with the acquisitions.

Income Taxes	9 Months Ended
Income Taxes	Sep. 30, 2024
Income Tax Disclosure [Abstract]
Income Taxes	Income Taxes The Company did not record any U.S. income tax expense during the three and nine months ended September 30, 2024 and 2023. The Company has historically incurred operating losses and maintains a full valuation allowance against its U.S. net deferred tax assets. Foreign taxes were insignificant during the three and nine months ended September 30, 2024 and 2023. Net operating losses (NOLs) and tax credit carry-forwards are subject to review and possible adjustment by the Internal Revenue Service (“IRS”) and may become subject to annual limitation due to ownership changes that occur under Section 382 of the Internal Revenue Code, as amended and similar state provisions. These ownership changes may limit the amount of carryforwards that can be utilized annually to offset future taxable income. In general, an ownership change, as defined by Section 382, results from transactions increasing the ownership of certain shareholders or public groups in the stock of a corporation by more than 50% over a three-year period. As of September 30, 2024, the Company was not limited on its NOLs and tax credit carry-forwards. The Company will continue to monitor future ownership changes for potential Section 382 limitations.

- Definition

The entire disclosure for income tax.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 12
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482685/740-10-50-12

Reference 2: http://www.xbrl.org/2003/role/exampleRef
-Topic 740
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-Name Accounting Standards Codification
-Section 55
-Paragraph 231
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482663/740-10-55-231

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-SubTopic 10
-Name Accounting Standards Codification
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-Paragraph 12C
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-URI https://asc.fasb.org/1943274/2147482685/740-10-50-12C

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
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-URI https://asc.fasb.org/1943274/2147482685/740-10-50-12B

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
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-Paragraph 1
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147477891/740-270-50-1

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
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-URI https://asc.fasb.org/1943274/2147479360/740-10-S99-1

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
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-Section 50
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-Publisher FASB
-URI https://asc.fasb.org/1943274/2147480990/946-20-50-13

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
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-SubTopic 10
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-Section S99
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-Subparagraph (SX 210.4-08(h)(2))
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Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-Name Accounting Standards Codification
-Publisher FASB
-URI https://asc.fasb.org/740/tableOfContent

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 14
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482685/740-10-50-14

Reference 11: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 21
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482685/740-10-50-21

Reference 12: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 17
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482685/740-10-50-17

Reference 13: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 2
-Subparagraph (SAB Topic 11.C)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147479360/740-10-S99-2

Reference 14: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-SubTopic 30
-Name Accounting Standards Codification
-Section 50
-Paragraph 2
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482603/740-30-50-2

+ Details

Leases

9 Months Ended

Sep. 30, 2024

Leases [Abstract]

Leases

The Company has entered into various long-term real estate operating leases primarily related to office, research and development, operating activities and an equipment financing lease related to the supercomputer. The Company’s leases have remaining terms from under 1 year to 8 years and some of those leases include options that provide Recursion with the ability to extend the lease term, generally for five years. The options are included in the lease term when it is reasonably certain that the option will be exercised.

For the nine months ended September 30, 2024 and 2023, Recursion entered into lease modifications resulting in a decrease to the right-of-use asset and lease liability of $3.1 million and an increase to the right-of-use asset and lease liability of $3.4 million, respectively. The modifications had no impact to the Condensed Consolidated Statements of Operations.

In September 2024, the Company entered into an operating lease agreement for office space in New York, New York with approximately 11,655 square feet (the “New York Lease”). The right of use began September 2024 when control of the asset was obtained. The New York Lease term is 4 years with a potential for a 3 or 6 year renewal option. Total fixed payments are expected to be approximately $6.9 million with additional variable expenses, including building expenses.

In May 2024, the Company entered into a financing lease agreement for the supercomputer equipment (the “Supercomputer Lease”). The right of use began May 2024 when control of the asset was obtained and the lease term is 3 years with two additional renewal options for a one or two year period. Total fixed payments are expected to be approximately $34.0 million.

In February 2024, the Company entered into an operating lease agreement related to the supercomputer for the exclusive use of physical space in a data center of approximately 1,851 square feet (the “Data Center Lease”). The right of use began in April 2024 and the lease term is 5 years with a five year renewal option. The lease includes provisions for escalating rent payments. Total fixed lease payments are expected to be approximately $13.0 million with additional variable expenses, including utilities and tax expenses.

In January 2024, the Company entered into an operating lease agreement for office space in London, England with approximately 6,792 square feet (the “London Lease”). The right of use began January 2024 when control of the asset was obtained. The London Lease term is 5 years with a five year renewal option. The London Lease includes provisions for escalating rent payments. Total fixed payments are expected to be approximately $7.9 million, additionally there will be variable expenses including building service charges related to the lease.

The components of the lease cost were:


	Three months ended September 30,				Nine months ended September 30, 2024
(in thousands)	2024		2023		2024		2023
Operating lease cost	$	3,020	$	2,024	$	8,602	$	6,042
Finance lease cost:
Amortization of leased assets	1,460		—		2,445		—
Interest on lease liabilities	562		—		938		—
Variable lease cost	704		532		1,939		1,689
Short-term lease cost	77		66		159		107
Total lease cost	$	5,823	$	2,622	$	14,083	$	7,838

Supplemental balance sheet information related to leases were:


(in thousands)	September 30, 2024		December 31, 2023
Assets
Operating lease right-of-use assets	$	47,882	$	33,663
Financing lease right-of-use assets	26,897		—
Total lease right-of-use assets	$	74,779	$	33,663

Liabilities
Current liabilities
Notes payable and financing lease liabilities	$	8,145	$	—
Operating lease liabilities	8,233		6,116
Total current lease liabilities	16,378		6,116
Non-current liabilities
Notes payable and financing lease liabilities, non-current	19,495		—
Operating lease liabilities, non-current	53,663		43,414
Total non-current lease liabilities	73,158		43,414
Total lease liabilities	$	89,536	$	49,530

Supplemental cash flow information related to leases were:


	Nine months ended September 30,
(in thousands)	2024		2023
Cash paid for amount included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	10,742	$	7,950
Operating cash flows from financing leases	379		—
Financing cash flows from financing leases	2,261		—

Right-of-use assets additions and modifications:
Operating leases	$	19,455	$	4,324
Financing leases	29,342		—

Lease term and discount rates as of September 30, 2024 were:


	September 30, 2024
Operating leases
Weighted-average remaining lease term (years)	5.7
Weighted-average discount rate	7.9	%
Finance leases
Weighted-average remaining lease term (years)	2.8
Weighted-average discount rate	7.6	%

Maturities of lease liabilities as of September 30, 2024 were:


(in thousands)	Operating leases		Finance leases
Remainder of 2024	$	2,268	$	2,511
2025	14,585		10,046
2026	15,467		10,046
2027	15,914		8,736
2028	13,226		—
Thereafter	17,660		—
Total lease payments	79,120		31,339
Less amounts representing interest or imputed interest	(17,224)		(3,699)
Present value of lease liabilities	$	61,896	$	27,640

Leases

The components of the lease cost were:


	Three months ended September 30,				Nine months ended September 30, 2024
(in thousands)	2024		2023		2024		2023
Operating lease cost	$	3,020	$	2,024	$	8,602	$	6,042
Finance lease cost:
Amortization of leased assets	1,460		—		2,445		—
Interest on lease liabilities	562		—		938		—
Variable lease cost	704		532		1,939		1,689
Short-term lease cost	77		66		159		107
Total lease cost	$	5,823	$	2,622	$	14,083	$	7,838

Supplemental balance sheet information related to leases were:


(in thousands)	September 30, 2024		December 31, 2023
Assets
Operating lease right-of-use assets	$	47,882	$	33,663
Financing lease right-of-use assets	26,897		—
Total lease right-of-use assets	$	74,779	$	33,663

Liabilities
Current liabilities
Notes payable and financing lease liabilities	$	8,145	$	—
Operating lease liabilities	8,233		6,116
Total current lease liabilities	16,378		6,116
Non-current liabilities
Notes payable and financing lease liabilities, non-current	19,495		—
Operating lease liabilities, non-current	53,663		43,414
Total non-current lease liabilities	73,158		43,414
Total lease liabilities	$	89,536	$	49,530

Supplemental cash flow information related to leases were:


	Nine months ended September 30,
(in thousands)	2024		2023
Cash paid for amount included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	10,742	$	7,950
Operating cash flows from financing leases	379		—
Financing cash flows from financing leases	2,261		—

Right-of-use assets additions and modifications:
Operating leases	$	19,455	$	4,324
Financing leases	29,342		—

Lease term and discount rates as of September 30, 2024 were:


	September 30, 2024
Operating leases
Weighted-average remaining lease term (years)	5.7
Weighted-average discount rate	7.9	%
Finance leases
Weighted-average remaining lease term (years)	2.8
Weighted-average discount rate	7.6	%

Maturities of lease liabilities as of September 30, 2024 were:


(in thousands)	Operating leases		Finance leases
Remainder of 2024	$	2,268	$	2,511
2025	14,585		10,046
2026	15,467		10,046
2027	15,914		8,736
2028	13,226		—
Thereafter	17,660		—
Total lease payments	79,120		31,339
Less amounts representing interest or imputed interest	(17,224)		(3,699)
Present value of lease liabilities	$	61,896	$	27,640