Nkarta, Inc.

Previous wording

Our Ntrust-1 clinical trial ("Ntrust-1") is a multi-center, open-label, dose-escalation Phase 1/2 clinical trial of NKX019 for lupus nephritis ("LN") and primary membranous nephropathy ("pMN"). Our Ntrust-2 clinical trial ("Ntrust-2") is a multi-center, open-label, dose-escalation Phase 1/2 clinical trial of NKX019 for systemic sclerosis ("scleroderma"), idiopathic inflammatory myopathy ("myositis"), antineutrophil cytoplasmic antibody (ANCA)-associated vasculitis ("AAV"), and rheumatoid arthritis ("RA"). In both studies, patients receive lymphodepleting conditioning ("LD") with a combination of fludarabine ("Flu") and cyclophosphamide ("Cy") prior to administration of NKX019, with the option for patients with cytopenias to receive Cy alone as modified LD. NKX019 is also being studied in an investigator-sponsored trial ("IST") at the University of California, Irvine in patients with myasthenia gravis ("MG") and in an IST at Columbia University Irving Medical Center in patients with systemic lupus erythematosus ("SLE").

Current wording

Our Ntrust-1 clinical trial ("Ntrust-1") is a multi-center, open-label, dose-escalation Phase 1/2 clinical trial of NKX019 for lupus nephritis ("LN") and primary membranous nephropathy ("pMN"). Our Ntrust-2 clinical trial ("Ntrust-2") is a multi-center, open-label, dose-escalation Phase 1/2 clinical trial of NKX019 for systemic sclerosis ("scleroderma"), and idiopathic inflammatory myopathy ("myositis"), which we currently consider our leading indications, as well as antineutrophil cytoplasmic antibody (ANCA)-associated vasculitis ("AAV"), and rheumatoid arthritis ("RA"). In both studies, patients receive lymphodepleting conditioning ("LD") with a combination of fludarabine ("Flu") and cyclophosphamide ("Cy") prior to administration of NKX019, with the option for patients with cytopenias to receive Cy alone as modified LD. NKX019 is also being studied in an investigator-sponsored trial ("IST") at the University of California, Irvine in patients with myasthenia gravis ("MG") and in an IST at Columbia University Irving Medical Center in patients with systemic lupus erythematosus ("SLE").

Previous wording

The following table summarizes our research and development expenses for the three and six months ended June 30, 2026 and 2025. The direct external development program expenses reflect external costs attributable to our clinical development candidates and preclinical candidates selected for further development. Such expenses include third-party contract costs relating to manufacturing, clinical trial activities, translational medicine and toxicology activities. The unallocated internal research and development costs include personnel, facility costs, laboratory consumables and discovery and research related activities associated with our pipeline.

Current wording

The following table summarizes our research and development expenses for the three and nine months ended September 30, 2026 and 2025. The direct external development program expenses reflect external costs attributable to our clinical development candidates and preclinical candidates selected for further development. Such expenses include third-party contract costs relating to manufacturing, clinical trial activities, translational medicine and toxicology activities. The unallocated internal research and development costs include personnel, facility costs, laboratory consumables and discovery and research related activities associated with our pipeline.

Previous wording

Research and development expenses. Research and development expenses were $29.0 million and $20.8 million for the three months ended June 30, 2026 and 2025, respectively. Research and development expenses were $54.0 million and $45.0 million for the six months ended June 30, 2026 and 2025, respectively.

Current wording

Research and development expenses. Research and development expenses were $29.5 million and $20.2 million for the three months ended September 30, 2026 and 2025, respectively. Research and development expenses were $83.5 million and $65.1 million for the nine months ended September 30, 2026 and 2025, respectively.

Previous wording

a $6.1 million increase in program costs primarily from higher clinical spending and manufacturing and materials expenses related to NKX019 to support clinical trials in autoimmune diseases;

Current wording

a $6.8 million increase in program costs primarily from higher clinical spending and manufacturing and materials expenses related to NKX019 to support clinical trials in autoimmune diseases;

Previous wording

a $1.9 million increase in other research costs, primarily consisting of higher consulting, and depreciation expenses, which was partially offset by lower laboratory supplies, facilities, and licenses expenses due to lower headcount; and

Current wording

a $1.9 million increase in other research costs, primarily consisting of higher consulting, laboratory supplies and depreciation and facilities expenses, which was partially offset by lower licenses expenses; and

Previous wording

a $0.8 million increase in personnel costs primarily from higher salaries and wages expense recognized primarily due to an increase in wages and health benefits expenses.

Current wording

a $0.6 million increase in personnel costs primarily from higher salaries and wages expense recognized primarily due to an increase in wages and health benefits expenses.

Previous wording

a $8.2 million increase in program costs primarily from higher clinical spending related to NKX019 to support clinical trials in autoimmune diseases, which was partially offset by lower manufacturing and materials expenses;

Current wording

a $15.0 million increase in program costs primarily from higher clinical spending related to NKX019 to support clinical trials in autoimmune diseases, which was partially offset by lower manufacturing and materials expenses; and

Previous wording

a $1.8 million increase in other research costs, primarily consisting of higher consulting and depreciation expenses, which was partially offset by lower facilities and licenses expenses due to lower headcount; and

Current wording

a $3.3 million increase in other research costs, primarily consisting of higher consulting and depreciation expenses, which was partially offset by lower facilities and licenses expenses due to lower headcount.

Previous wording

General and administrative expenses. General and administrative expenses were $14.1 million and $6.4 million for the three months ended June 30, 2026 and 2025, respectively, and $20.0 million and $18.8 million for the six months ended June 30, 2026 and 2025, respectively. The increase of $7.7 million for the three months ended June 30, 2026 was primarily due to a $8.0 million impairment expense of equipment, leasehold improvements and right-of-use assets in June 2026, offset by a $0.3 million decrease in personnel and recruiting expenses due to lower headcount. The increase of $1.2 million for the six months ended June 30, 2026 was primarily due to a $8.0 million impairment expense of equipment, leasehold improvements and right-of-use assets in June 2026, offset by a $6.8 million decrease in personnel expenses, including $4.8 million in severance expenses from the reduction in force incurred in March 2025.

Current wording

General and administrative expenses. General and administrative expenses were $6.3 million and $7.1 million for the three months ended September 30, 2026 and 2025, respectively, and $26.3 million and $25.9 million for the nine months ended September 30, 2026 and 2025, respectively. The decrease of $0.8 million for the three months ended September 30, 2026 was primarily due to a $0.8 million ROU asset impairment expense recorded in September 2025. The increase of $0.4 million for the nine months ended September 30, 2026 was primarily due to a $8.0 million impairment expense of equipment, leasehold improvements and right-of-use assets in June 2026, partially offset by a $0.8 million ROU asset impairment expense recorded in September 2025 and a $6.9 million decrease in personnel expenses, including $4.8 million in severance expenses from the reduction in force incurred in March 2025.

Previous wording

Interest income. Interest income was $2.5 million and $4.0 million for the three months ended June 30, 2026 and 2025, respectively, and $5.4 million and $8.3 million for the six months ended June 30, 2026 and 2025, respectively. The decreases of $1.5 million and $2.9 million for the three and six months ended June 30, 2026, respectively, were primarily due to lower average investment balances and lower average interest rates in the current period. Interest income includes interest earned from investments, partially offset by amortization of purchase premiums and accretion of discounts of investments.

Current wording

Interest income. Interest income was $2.2 million and $3.9 million for the three months ended September 30, 2026 and 2025, respectively, and $7.6 million and $12.2 million for the nine months ended September 30, 2026 and 2025, respectively. The decreases of $1.6 million and $4.6 million for the three and nine months ended September 30, 2026, respectively, were primarily due to lower average investment balances and lower average interest rates in the current period. Interest income includes interest earned from investments, partially offset by amortization of purchase premiums and accretion of discounts of investments.

Previous wording

As of June 30, 2026, we had cash, cash equivalents, restricted cash and investments of $243.2 million. We estimate that all $265.1 million in net proceeds from our July 2020 initial public offering have been spent. On April 28, 2022, we received $215.3 million in net proceeds, after deducting underwriting discounts, commissions and other offering expenses, in connection with our secondary offering of our common stock. On March 27, 2024, we received $225.1 million in net proceeds from an underwritten public offering, after deducting underwriting discounts, commissions and expenses, described further below.

Current wording

As of September 30, 2026, we had cash, cash equivalents, restricted cash and investments of $216.0 million. We estimate that all $265.1 million in net proceeds from our July 2020 initial public offering have been spent. On April 28, 2022, we received $215.3 million in net proceeds, after deducting underwriting discounts, commissions and other offering expenses, in connection with our secondary offering of our common stock. On March 27, 2024, we received $225.1 million in net proceeds from an underwritten public offering, after deducting underwriting discounts, commissions and expenses, described further below.

Previous wording

On March 27, 2024, we completed an underwritten public offering utilizing the Shelf Registration Statement, pursuant to which we sold an aggregate of (i) 21,010,000 shares of common stock at a price of $10.00 per share, and (ii) pre-funded warrants to purchase 3,000,031 shares of common stock at a price of $9.9999 per pre-funded warrant. The pre-funded warrants can be exercised at any time after issuance for an exercise price of $0.0001 per share, subject to certain ownership limitations. As of June 30, 2026, none of the pre-funded warrants have been exercised. We raised $240.1 million in gross proceeds before underwriting discounts, commissions and other expenses of $15.0 million.

Current wording

On March 27, 2024, we completed an underwritten public offering utilizing a Form S-3 Shelf Registration Statement, pursuant to which we sold an aggregate of (i) 21,010,000 shares of common stock at a price of $10.00 per share, and (ii) pre-funded warrants to purchase 3,000,031 shares of common stock at a price of $9.9999 per pre-funded warrant. The pre-funded warrants can be exercised at any time after issuance for an exercise price of $0.0001 per share, subject to certain ownership limitations. As of September 30, 2026, none of the pre-funded warrants have been exercised. We raised $240.1 million in gross proceeds before underwriting discounts, commissions and other expenses of $15.0 million.

Previous wording

On March 25, 2026, we filed a Registration Statement on Form S-3 (the “Shelf Registration Statement”), covering the offer and sale from time to time, pursuant to Rule 415 of the Securities Act of 1933, as amended (the “Securities Act”), of up to $350.0 million in aggregate offering price of shares of the Company’s common stock, shares of the Company’s preferred stock, debt securities, warrants, rights and/or units. The Shelf Registration Statement was declared effective by the Securities and Exchange Commission (the "SEC") on April 3, 2026. The Shelf Registration Statement included a prospectus covering the offer and sale from time to time of up to $100.0 million in aggregate offering price of shares of the Company’s common stock through an “at-the-market” equity offering program (the “ATM Offering Program”) with Stifel, Nicolaus & Company, Incorporated, as sales agent. As of June 30, 2026, no sales of the Company’s common stock had been made pursuant to the ATM Offering Program.

Current wording

On March 25, 2026, we filed a Registration Statement on Form S-3 (the “2026 Shelf Registration Statement”), covering the offer and sale from time to time, pursuant to Rule 415 of the Securities Act of 1933, as amended (the “Securities Act”), of up to $350.0 million in aggregate offering price of shares of the Company’s common stock, shares of the Company’s preferred stock, debt securities, warrants, rights and/or units. The 2026 Shelf Registration Statement was declared effective by the Securities and Exchange Commission (the "SEC") on April 3, 2026. The 2026 Shelf Registration Statement included a prospectus covering the offer and sale from time to time of up to $100.0 million in aggregate offering price of shares of the Company’s common stock through an “at-the-market” equity offering program (the “ATM Offering Program”) with Stifel, Nicolaus & Company, Incorporated, as sales agent. As of September 30, 2026, no sales of the Company’s common stock had been made pursuant to the ATM Offering Program.

Previous wording

We have incurred net losses and negative cash flows from operations since our inception. As of June 30, 2026, we had an accumulated deficit of $716.5 million and anticipate that we will continue to incur net losses for the foreseeable future. We expect to incur substantial expenditures as we develop our product pipeline and advance our drug candidates through clinical development, undergo the regulatory approval process and, if approved, launch commercial activities. Specifically, in the near term we expect to incur substantial expenses relating to initiating and completing our clinical trials, the development and validation of our manufacturing processes, and other development activities.

Current wording

We have incurred net losses and negative cash flows from operations since our inception. As of September 30, 2026, we had an accumulated deficit of $749.8 million and anticipate that we will continue to incur net losses for the foreseeable future. We expect to incur substantial expenditures as we develop our product pipeline and advance our drug candidates through clinical development, undergo the regulatory approval process and, if approved, launch commercial activities. Specifically, in the near term we expect to incur substantial expenses relating to initiating and completing our clinical trials, the development and validation of our manufacturing processes, and other development activities.

Previous wording

Net cash used in operating activities for the six months ended June 30, 2026 was $52.4 million primarily due to a net loss of $68.2 million adjusted for a decrease in net change in operating assets and liabilities of $1.0 million, which was offset by net non-cash charges of $16.8 million. The change in net operating assets and liabilities was primarily due to an increase in accounts payable and prepaid expenses, and a decrease in operating lease liability. Cash flows from operations are generally impacted by the timing of payments to vendors and vendor payment terms. The non-cash charges primarily consisted of impairment expenses of $8.0 million, stock-based compensation of $3.8 million, depreciation and amortization of $5.1 million, and non-cash lease expense of $1.1 million, which was offset by investment accretion and amortization of $1.2 million.

Current wording

Net cash used in operating activities for the nine months ended September 30, 2026 was $78.3 million primarily due to a net loss of $101.5 million adjusted for an increase in net change in operating assets and liabilities of $2.5 million, which was offset by net non-cash charges of $20.8 million. The change in net operating assets and liabilities was primarily due to an increase in accounts payable and prepaid expenses, and a decrease in operating lease liability. Cash flows from operations are generally impacted by the timing of payments to vendors and vendor payment terms. The non-cash charges primarily consisted of impairment expenses of $8.0 million, stock-based compensation of $5.5 million, depreciation and amortization of $7.1 million, and non-cash lease expense of $1.6 million, which was offset by investment accretion and amortization of $1.5 million.

Previous wording

Net cash used in operating activities for the six months ended June 30, 2025 was $48.4 million primarily due to a net loss of $55.0 million adjusted for a decrease in net change in operating assets and liabilities of $1.1 million, which was offset by net non-cash charges of $7.6 million. The change in net operating assets and liabilities was primarily due to an increase in accounts payable and prepaid expenses, and a decrease in operating lease liability. Cash flows from operations are generally impacted by the timing of payments to vendors and vendor payment terms. The non-cash charges primarily consisted of stock-based compensation of $4.9 million, depreciation and amortization of $4.6 million, and non-cash lease expense of $0.9 million, which was offset by investment accretion and amortization of $2.8 million.

Current wording

Net cash used in operating activities for the nine months ended September 30, 2025 was $67.1 million primarily due to a net loss of $76.7 million adjusted for a decrease in net change in operating assets and liabilities of $2.4 million, which was offset by net non-cash charges of $12.0 million. The change in net operating assets and liabilities was primarily due to an increase in prepaid expenses, and a decrease in accounts payable and operating lease liability. Cash flows from operations are generally impacted by the timing of payments to vendors and vendor payment terms. The non-cash charges primarily consisted of stock-based compensation of $6.7 million, depreciation and amortization of $6.9 million, which was partially offset by investment accretion and amortization of $3.7 million.

Previous wording

Net cash provided by investing activities for the six months ended June 30, 2025 was $73.8 million, which consisted primarily of proceeds from the maturities of marketable securities of $163.9 million, partially offset by the purchase of marketable securities of $89.4 million and the purchase of property and equipment of $0.7 million.

Current wording

Net cash provided by investing activities for the nine months ended September 30, 2026 was $86.2 million, which consisted primarily of proceeds from the sales and maturities of marketable securities of $194.2 million and sale of property and equipment of $0.1 million, partially offset by the purchase of marketable securities of $106.3 million and the purchase of property and equipment of $1.8 million.

Previous wording

Net cash provided by investing activities for the six months ended June 30, 2026 was $37.1 million, which consisted primarily of proceeds from the sales and maturities of marketable securities of $134.3 million, partially offset by the purchase of marketable securities of $96.6 million and the purchase of property and equipment of $0.6 million.

Current wording

Net cash provided by investing activities for the nine months ended September 30, 2025 was $99.2 million, which consisted primarily of proceeds from the sales and maturities of marketable securities of $247.0 million, partially offset by the purchase of marketable securities of $147.1 million and the purchase of property and equipment of $0.6 million.

Previous wording

There was immaterial cash provided by financing activities for the six months ended June 30, 2026 and 2025.

Current wording

Net cash provided by financing activities for the nine months ended September 30, 2026 was $0.8 million, which consisted primarily of proceeds from stock option exercises. There was immaterial cash provided by financing activities for the nine months ended September 30, 2025.

Previous wording

See Note 6 to our condensed financial statements included elsewhere in this Quarterly Report on Form 10-Q for additional information regarding our lease liability.

Current wording

See Note 6 to our unaudited condensed financial statements included elsewhere in this Quarterly Report on Form 10-Q for additional information regarding our lease liability.

Previous wording

There have been no significant changes in our critical accounting policies and estimates during the six months ended June 30, 2026, as compared to the critical accounting policies and estimates disclosed in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” included in our Annual Report on Form 10-K for the year ended December 31, 2025 and filed with the SEC on March 25, 2026.

Current wording

There have been no significant changes in our critical accounting policies and estimates during the nine months ended September 30, 2026, as compared to the critical accounting policies and estimates disclosed in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” included in our Annual Report on Form 10-K for the year ended December 31, 2025 and filed with the SEC on March 25, 2026.