Fractyl Health, Inc. Common Stock (GUTS) Earnings

Management highlights

- Clinical Progress for Revita Post-GLP-1 Weight Maintenance Therapy * Published 1-year randomized sham-controlled data from the Remain One midpoint cohort: Revita patients maintained 80% of prior GLP-1-induced weight loss, compared to 46% in the sham control arm. An additional open-label REVEAL-1 cohort showed a consistent 78% weight loss maintenance rate through one year post-procedure. * No device or procedure-related serious adverse events were reported over one year of follow-up, with only four mild treatment-emergent adverse events that resolved within two days, resulting in an unusually clean safety profile for an obesity procedural therapy. * The Remain One Pivotal cohort completed randomization in February 2026 with over 300 participants across 30 sites. The trial is enriched for complete ablation (median ablation length of 16cm) and higher run-in weight loss (mean of 18.3%), the two factors linked to stronger treatment effects, and is powered at over 95% for both co-primary endpoints. Retention remains above 90%, medication resumption remains below projections, and the trial remains on track. * Received favorable FDA feedback that Revita qualifies for moderate rather than high risk device classification. - Clinical Progress for Rejuva Gene Therapy Platform * Received clinical trial authorization in the Netherlands and Ethics Committee approval in Australia for the Phase 1/2 first-in-human study of Rejuva 001, the first AAV-based gene therapy candidate entering clinical development for type 2 diabetes. Rejuva 001 is a one-time pancreatic targeted therapy designed to enable physiologic GLP-1 expression, avoiding the systemic side effects of chronic GLP-1 therapy. * The study uses staggered sentinel dosing to prioritize patient safety, and is expected to dose the first patient imminently, with preliminary data expected in H2 2026. - Commercial Opportunity * Growing GLP-1 adoption (30 million Americans on therapy, 1 million discontinuing monthly) expands the addressable market for a one-time drug-free weight maintenance alternative. Oral GLP-1s increase new initiations rather than switching, adding more future potential patients for Revita, and next-generation GLP-1s with greater weight loss will increase Revita's treatment effect, as greater run-in weight loss correlates to larger Revita benefit post-discontinuation. * Revita leverages existing gastroenterology clinic infrastructure and expertise, requiring no new site of care. Payers (including CMS) are increasingly focused on the long-term affordability of chronic GLP-1 therapy, aligning with Revita's value proposition as a one-time durable solution. - Capital Position * Ended Q2 2026 with $47.1 million in cash, enough to fund operations into early 2027, past the pivotal data readout and planned de novo submission. No capital raise is planned before pivotal data readout, and Rejuva's development is funded within the existing capital envelope without competing with Revita.

Guidance

- Revita top-line 6-month primary endpoint data from the Remain One Pivotal cohort will be reported in early Q4 2026, with top-line 12-month data expected in Q1 2027. - A potential FDA de novo marketing application submission for Revita is on track for late Q4 2026, following 6-month pivotal data readout. - The first Rejuva 001 patient will be dosed imminently following site activation, with preliminary safety and feasibility data expected in H2 2026. - Fractal will host an Investor Day in early September 2026 to detail Revita's commercial opportunity, market access strategy, and health economics analysis.

Segment performance

Fractal Health is a clinical-stage biotech/medical device company with two product segments: Revita (post-GLP-1 weight maintenance procedural therapy) and Rejuva (GLP-1 gene therapy platform). No commercial revenue was generated in Q2 2026, so there is no revenue contribution percentage for either segment. Expenses for the quarter are as follows: R&D expenses were $13.8 million, down from $21.2 million in Q2 2025, a decrease driven by reduced spending on both Revita and Rejuva programs after completion of Revita's pivotal randomization. SG&A expenses were $5.3 million, up from $4.9 million in Q2 2025, an increase driven by higher stock compensation expense. Net loss was $25.5 million, a $2.4 million improvement from the $27.9 million net loss in Q2 2025. Adjusted EBITDA was negative $16.3 million, an improvement of $7.7 million from the negative $24 million adjusted EBITDA in Q2 2025. As of June 30, 2026, Fractal held $47.1 million in cash and cash equivalents, with operating cash burn of ~$16 million in Q2 2026.

Risks & headwinds

- Forward-looking statements (including clinical trial results, regulatory timelines, and commercial opportunity) are subject to inherent risks and uncertainties that could cause actual results to differ materially from expectations, as detailed in Fractal's SEC filings. - Final regulatory pathway and approval for Revita are dependent on FDA review of the complete pivotal safety dataset, and no guarantee of approval can be made at this stage. - Actual GLP-1 discontinuation rates may differ from current projections, which would impact the size of Revita's addressable market. - Reimbursement coverage terms from payers and Medicare are not yet finalized, and the specific coverage eligibility criteria that will be imposed remain uncertain.

Analyst Q&A

• Q: What procedure volume per center supports profitability with a targeted launch in 100-200 U.S. centers, and how quickly will trained physicians ramp volume? Also, what coverage criteria do you expect payers/Medicare to impose for Revita? /

  A: Detailed profitability volume figures will be presented alongside full health economics analysis at the September Investor Day. Physicians require less than 5 procedures to become comfortable, as the procedure leverages existing endoscopy skills with no new complex training required. Management expects payers will align coverage criteria with the pivotal trial's pre-specified patient population, most likely requiring at least 15% run-in weight loss on GLP-1 therapy prior to treatment. Medicare is already concerned about GLP-1-related frailty in elderly patients and expects millions of patients to discontinue GLP-1s after the 18-month Medicare GLP-1 bridge program ends, creating immediate demand for Revita.

• Q: What is the outlook for transitional coverage for Revita as a breakthrough device after approval, and what is the planned size of your commercial launch infrastructure? /

  A: Breakthrough devices automatically qualify for CMS transitional pass-through payment if they are novel and do not fit existing CPT code schemas, which Fractal expects Revita to meet. The recent CMS rule reaffirmed this framework for coming years, so Revita should have reimbursement from launch day. Fractal plans a targeted, efficient center of excellence model focused on the top 100-200 high-volume endoscopy health systems that perform half of all U.S. endoscopies, enabling launch with a smaller focused commercial team.

• Q: What is the scope of Fractal's patent estate for post-GLP-1 weight maintenance ablation technology? /

  A: Fractal holds a broad, comprehensive patent estate, with issued U.S. patents covering both its specific Revita device and methods, as well as broadly covering both thermal and non-thermal duodenal ablation modalities for post-GLP-1 weight loss maintenance, type 2 diabetes, and other metabolic conditions. Fractal intends to defend its intellectual property position in this market.

• Q: What has been the change in GLP-1 discontinuation rates as physicians gain more experience with the drug class? /

  A: Published meta-analyses still show a median GLP-1 therapy duration of 6-9 months, with no material change to discontinuation rates. The 1 million monthly U.S. GLP-1 discontinuations figure remains a valid baseline for estimating addressable market. Early data for oral GLP-1s suggests lower dose titration than initially expected, but the impact on long-term adherence remains too early to confirm.