Schrödinger (SDGR) investor relations material

Executive summary

• Q1 2026 revenue was $58.6 million, with software revenue at $35.6 million (down 21% year-over-year) and drug discovery revenue at $22.9 million (up 124%), resulting in a net loss of $60.0 million.

• Achieved 12% ACV growth to $28.4 million, driven by usage scale-ups, new customers, and new products.

• Hosted software revenue grew to 34% of software total in Q1 2026, reflecting an accelerated transition to hosted licensing.

• Cash and marketable securities totaled $406 million at quarter end.

• Announced $2.3 billion acquisition of Ajax Therapeutics by Lilly, with a 5.8–6% equity stake held, expected to provide a significant cash inflow.

Financial highlights

• Software gross margin was 69%, down from 80% in Q1 2025, due to the shift to hosted licensing.

• Operating expenses decreased 4% year-over-year to $78.3 million, reflecting efficiency measures.

• Contribution revenue declined to $0.1 million from $4.3 million, reflecting completion of Gates Foundation funding.

• Gross profit was $29.5 million, with overall gross margin at 50.5%.

• Adjusted EBITDA for Q1 2026 was $(37.7) million.

Outlook and guidance

• Full-year 2026 ACV expected in the range of $218 million–$228 million, representing 10–15% growth.

• Drug discovery revenue guidance for 2026 is $55 million–$65 million, with expected quarterly variability.

• Operating expenses for 2026 projected to be lower than 2025, with continued investment in sales and marketing.

• Q2 2026 ACV guidance is $19 million–$23 million, excluding contribution ACV.

• Existing cash and marketable securities expected to fund operations for at least the next 24 months.