An American medical company treating obesity and type 2 diabetes at their root. Its lead procedure, Revita, uses a heat-based endoscopic device to resurface the lining of the small intestine, helping people keep weight off after stopping GLP-1 drugs; its Rejuva platform delivers genes that reprogram insulin-making pancreatic cells. Founded in 2010 as MedCatalyst, the firm took its name from "fractal," echoing the repeating folds inside the intestine, and trades on Nasdaq as "GUTS."
R&D spending fell 35% as Fractyl Health conserved cash ahead of pivotal obesity trial data, but cash of $47.1M funds operations only into early 2027.
The operating loss narrowed as the company cut research spending sharply ahead of the most consequential readout in its history. Net loss was $25.5 million, down from $27.9 million a year ago, as R&D expense fell 35% to $13.8 million, offset by a $5.5 million non-cash loss on warrant liabilities. The REMAIN-1 pivotal trial data expected in early Q4 2026 will determine whether the company has a product to fund.
Key takeaways
Research and development expense fell 34.7% to $13.8 million, driven by a $4.5 million decrease in Revita clinical costs and a $2.7 million decline in Rejuva manufacturing and preclinical spending, as the company conserved cash ahead of the REMAIN-1 data readout.
The net loss narrowed to $25.5 million from $27.9 million a year ago, but the improvement was entirely from lower operating expenses; other expense widened to $6.4 million from $1.8 million, mainly from a $5.5 million non-cash loss on the change in fair value of warrant liabilities tied to the August 2025 warrants.
Section summaries
Management's Discussion and Analysis
Net loss narrowed to $25.5M in Q2 2026 as R&D spend fell 35% on lower clinical costs; cash of $47.1M funds operations into early 2027.
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Research and development expenses dropped 34.7% to $13.8M, driven by a $4.5M decrease in Revita clinical costs and a $2.7M decline in Rejuva manufacturing and preclinical spending.
Cash and equivalents fell 25.4% during the quarter to $47.1 million, and management stated this funds operations into early 2027 but not for twelve months from the filing date, keeping the going-concern warning in place.
The company expects topline six-month data from the REMAIN-1 Pivotal Cohort in early Q4 2026 and a potential FDA submission in late Q4 2026, making the next two quarters the defining period for the Revita program.
A Nasdaq deficiency notice received on March 13, 2026, gives the company until September 9, 2026, to regain compliance by maintaining a closing bid price of at least $1.00 for 10 consecutive trading days, or face delisting.
What changed
The REMAIN-1 pivotal study completed randomization of 307 participants in February 2026, and the company now expects topline six-month data in early Q4 2026 — the single most consequential catalyst flagged across every prior filing.
Cash and equivalents fell to $47.1 million from $63.2 million at the end of Q1 2026, a 25.4% quarterly decline, as the operating cash outflow of $15.9 million continued to draw down the runway that management says extends only into early 2027.
The Nasdaq deficiency notice, first disclosed in Q1 2026, remains unresolved with a September 9, 2026 compliance deadline; the stock must hold above $1.00 for 10 consecutive trading days to avoid delisting proceedings.
R&D spending fell sharply to $13.8 million from $21.0 million a year ago, reversing the multi-quarter trend of rising clinical and preclinical costs as the company cut Revita and Rejuva program spending to extend its cash runway into the REMAIN-1 readout.
What to watch
Topline six-month data from the REMAIN-1 pivotal study of Revita for weight maintenance after GLP-1 discontinuation, expected in early Q4 2026 — the single most consequential event for the company's future.
Whether the company regains Nasdaq compliance by September 9, 2026, by maintaining a closing bid price of at least $1.00 for 10 consecutive trading days.
The quarterly cash burn rate and resulting cash balance relative to the $10.0 million minimum liquidity , given the early-2027 cash runway and the $47.1 million balance at quarter-end.
Any update on CTA authorization and first-in-human dosing for the Rejuva gene therapy candidate RJVA-001, still expected in the second half of 2026.
Selling, general and administrative expenses rose 7.2% to $5.3M primarily due to higher .
Other expense, net, widened to $6.4M from $1.8M, mainly from a $5.5M loss on the change in tied to the August 2025 warrants.
Cash and cash equivalents stood at $47.1M as of June 30, 2026, which management expects will fund operations into early 2027, though substantial doubt exists about the company's ability to continue as a .
The company anticipates topline six-month data from the REMAIN-1 Pivotal Cohort in early Q4 2026 and a potential FDA submission in late Q4 2026.
Quantitative and Qualitative Disclosures About Market Risk
We are a smaller reporting company as defined in Item 10(f)(1) of Regulation S-K. As a result, pursuant to Item 305(e) of Regulation S-K, we are not required to provide the information required by this Item 3.
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We are a smaller reporting company as defined in Item 10(f)(1) of Regulation S-K. As a result, pursuant to Item 305(e) of Regulation S-K, we are not required to provide the information required by this Item 3.