Schrödinger, Inc. (SDGR) Earnings
Schrödinger, Inc. is expected to report next earnings on November 4, 2026 (in NaN days), with a consensus EPS estimate of $-0.70. SDGR has beaten EPS estimates in 6 of its last 12 reported quarters (average surprise +138.8% over the last four).
| Report date | EPS est | EPS actual | Surprise | Revenue | Rev. surprise |
|---|---|---|---|---|---|
| Aug 5, 2026 | $-0.41 | $0.08 | +119.3% | $59M | +24.8% |
| May 5, 2026 | $-0.56 | $-0.81 | -44.6% | $59M | +23.2% |
| Feb 25, 2026 | $-0.13 | $0.44 | +440.5% | $87M | +4.3% |
| Nov 5, 2025 | $-0.75 | $-0.45 | +40.0% | $54M | -35.0% |
| Aug 6, 2025 | $-0.83 | $-0.59 | +28.9% | $55M | +8.8% |
| May 7, 2025 | $-0.71 | $-0.82 | -15.5% | $60M | +9.0% |
| Feb 26, 2025 | $-0.35 | $-0.55 | -57.1% | $88M | +6.2% |
| Jul 31, 2024 | $-0.85 | $-0.74 | +12.9% | $47M | +20.3% |
| May 1, 2024 | $-0.75 | $-0.76 | -1.3% | $37M | -11.9% |
| Feb 28, 2024 | $-0.38 | $-0.41 | -7.9% | $74M | -6.2% |
| Nov 1, 2023 | $-0.71 | $-0.86 | -21.1% | $43M | -46.0% |
| Aug 2, 2023 | $-0.43 | $-0.21 | +51.2% | $35M | -7.1% |
Source: company filings + earnings calendar. For informational purposes only — not investment advice.
Earnings call summary
Q2 FY2026 · August 5, 2026
AI summary of management’s prepared remarks and analyst Q&A. For informational purposes only — not investment advice.
Management highlights
### Overall Business Momentum - 27% YoY total ACV growth in Q2 2026, driven by broad-based demand across large pharma, biotech, and materials science customers, reflecting growing industry adoption of Schrodinger's computationally driven, predict-first drug discovery approach. - Trailing four-quarter total ACV reached $208 million, with first half 2026 total ACV of $58.0 million, representing 19% growth YoY. - The company ended the quarter with a strong balance sheet, holding $419 million in cash and marketable securities, with $6 million in net income (vs a $43 million net loss in Q2 2025, driven by a gain from Eli Lilly's acquisition of Ajax Therapeutics). AI Platform Innovation (Bunsen Agentic AI Co-Scientist) - Bunsen automates complex multi-step discovery workflows, increasing efficiency for expert computational chemists and enabling more design projects to be run concurrently. It also expands platform access for non-specialist drug hunters, growing the company's long-term user base. - NVIDIA and Google Cloud are partnering to provide additional tools and compute resources to support Bunsen early access. Bristol Myers Squibb (BMS), a long-time customer, has deployed Bunsen in a new strategic software agreement that scales up BMS' use of Schrodinger's platform. - Bunsen uses a throughput-based licensing model, allowing Schrodinger to capture value from the expected significant increase in platform usage driven by the tool. Product Expansion - Predictive Toxicology, Schrodinger's new physics-based solution that predicts off-target binding risks before molecule synthesis, is progressing well in commercial evaluations and has already contributed to 2026 ACV. The solution helps customers address safety issues early, cutting discovery timelines and costs. Therapeutics Portfolio Progress - Bunsen integration has boosted cross-functional productivity across the therapeutics portfolio, accelerating workflows from early target analysis and structural biology through late-stage DMPK, pharmacology, and toxicology data analysis, shortening the drug discovery cycle. - A new global collaboration with Simseer Pharmaceutical Group was announced in July 2026, combining Schrodinger's predict-first design capabilities with Simseer's preclinical and clinical execution to move discovery advances into clinical development faster. Schrodinger is eligible for development, commercial milestones and tiered royalties. - Since 2020, the company has generated over $750 million from therapeutics activities via collaborations, co-invented drugs, and co-founded companies. Most recently, Eli Lilly acquired Ajax Therapeutics for $2.3 billion, and Phase I data for Ajax's lead JAK inhibitor AJ1-11095 confirmed the molecule matches its differentiated target product profile. Operational Strategy - The company is accelerating the transition of customers to hosted licensing, which recognizes revenue ratably over contract terms rather than mostly upfront. This transition temporarily reduces near-term reported revenue, with each 1% increase in hosted share reducing reported revenue by $2-3 million depending on contract terms. The company remains on track to reach 75% hosted revenue by the end of 2028. - The company maintained disciplined expense management, with total Q2 operating expenses down 6% YoY to $74 million, driven by lower headcount, CRO and professional services fees.
Guidance
- Full-year 2026 total ACV guidance is maintained at 218 to 228 million, representing 10% to 15% growth over 2025. - Full-year 2026 drug discovery revenue guidance is set at 65 to 75 million. - Q3 2026 ACV excluding contribution is expected to be 41 to 45 million, compared to 38.3 million in Q3 2025 (which included 2.2 million of contribution ACV). - The company notes Q4 is typically its largest ACV quarter, typically accounting for over 50% of annual ACV, and current pipeline of expected closing opportunities is progressing as planned.
Segment performance
Software: ACV (Annual Contract Value) of $22.6 million (excluding contribution, +23% YoY, at the upper end of expectations). Total software revenue was $32.5 million, with hosted revenue of $15.2 million, representing 47% of total software revenue, up from 31% YoY. Software gross margin was 71% for the quarter, down from 76% YoY due to the accelerated transition to hosted licensing. Contribution: Contribution ACV was $7 million, consisting of $5 million from the Gates Foundation extended funding for the Predictive Toxicology Initiative and $2 million from Gates Ventures for battery research. Total contribution revenue was $3.4 million, down YoY due to completion of initial Gates Foundation predictive toxicology funding, partially offset by the new battery research grant. Drug Discovery: Drug discovery revenue was $23 million, up from $13.9 million YoY, driven primarily by a $10 million collaboration milestone received from Ajax Therapeutics.
Risks & headwinds
- Forward-looking statements (including all guidance, product launch expectations, and strategic plans) are subject to material risks that could cause actual results to differ materially, including the risk factors disclosed in Schrodinger's SEC filings, most recently the Form 10-Q for the quarter ended June 30, 2026. - The ongoing transition to hosted licensing creates temporary downward pressure on near-term reported revenue. - New products like Predictive Toxicology require multi-year adoption timelines, as customers need time to evaluate and validate the technology internally, so near-term contributions may be smaller than long-term expectations.
Analyst Q&A
Q: Alexa Chan (Bank of America) asked for an update on biopharma/biotech end market health, and details on Predictive Toxicology's ACV contribution and future expectations. /
A: Management confirmed the biotech sector is noticeably healthier in 2026 than 2025, with year-to-date IPO volumes already double 2025 levels. Funding stress that negatively impacted customer demand in 2025 has declined significantly. The company does not break out ACV for individual products, but confirms Predictive Toxicology has contributed to 2026 ACV as noted, and its contribution is included in full-year guidance.
Q: Matt Hewitt (Craig-Hallam) asked for details on Bunsen's sales pipeline, pricing model, and customer feedback on the transition to hosted licensing. /
A: The BMS agreement is the first public large-scale deployment, and it demonstrates how Bunsen drives value: BMS significantly scaled up its access to Schrodinger's technology through the deal, aligning with the company's expectation that Bunsen will increase platform usage. On hosted transition, management confirmed they are on track to hit the target of 75% hosted revenue by end-2028, reaching 47% hosted share this quarter, with strong customer engagement, and some early customer transitions that boosted this quarter's share above baseline trend.
Q: Scott Schoenhaus (KeyBank) asked what share of ACV growth comes from new product launches, and where future new product growth will come from, plus details on the drivers of lower operating expenses. /
A: New product launches from Schrodinger's strong R&D pipeline are a major contributor to ACV growth, alongside existing customers scaling up usage of current products, with more new product launches planned to unlock additional pharma budgets. Lower operating expenses reflect intentional efficiency efforts, including reduced personnel, CRO, and professional services costs, alongside internal productivity gains from Bunsen integration.
Q: Connor (BMO Capital Markets) asked for specific details on where Bunsen delivers the greatest productivity benefits for Schrodinger's internal therapeutics workflows. /
A: The largest gains are seen in structure-based drug design workflows, including accelerating protein structure analysis, binding site characterization, and structure preparation for platform use. Bunsen also automates routine tasks, freeing up scientist time, and monitors ongoing computational jobs overnight/weekends: it automatically restarts failed jobs, eliminating lost throughput from unmonitored work, a major hidden efficiency gain. It accelerates workflows across every stage of the drug discovery process.