Schrödinger (SDGR) investor relations material

Executive summary

• Achieved strong momentum in Q2 2026 with 27% ACV growth year-over-year, reaching $29.6M, driven by broad-based demand, new product uptake, and robust drug discovery revenue, especially from a $10M milestone related to Ajax Therapeutics.

• Launched early access for Bunsen, an AI co-scientist, expanding platform capabilities and user base, with strategic deployments at Bristol Myers Squibb and collaborations with Simcere Pharmaceuticals.

• Net income reached $6.0M, reversing a net loss of $43.2M in Q2 2025, aided by $48.9M in other income from Eli Lilly’s acquisition of Ajax Therapeutics.

• Predictive Toxicology and new products like RetroSynth contributed to ACV and commercial traction, with expanded funding from the Gates Foundation.

• Therapeutics portfolio productivity increased with Bunsen integration and new collaborations, notably with Simcere Pharmaceutical Group.

Financial highlights

• Q2 2026 total revenue was $58.9M, up 8% year-over-year; software revenue was $32.5M (down 10%), hosted revenue reached 47% of software total, and drug discovery revenue surged 65% to $23.0M, driven by milestone payments.

• Gross profit for Q2 2026 was $32.4M, with software gross margin at 71% (down from 76% in Q2 2025).

• Operating expenses decreased 6% year-over-year to $74.0M, reflecting lower headcount and service fees.

• Net income margin for Q2 2026 was 10%.

• Ended the quarter with $418.8M in cash and marketable securities.

Outlook and guidance

• Full-year 2026 ACV expected at $218M–$228M, representing 10%–15% growth over 2025.

• Drug discovery revenue guidance raised to $65M–$75M for 2026 due to milestone achievements.

• Q3 2026 ACV (excluding contribution) expected at $41M–$45M, up from $38.3M in Q3 2025.

• Operating expenses for 2026 expected to be lower than 2025.

• 2028 objectives include durable ACV growth of 10–15% annually, gross margin returning to high 70s, and positive adjusted EBITDA by year-end 2028.