Schrödinger, Inc. 8-K
PositiveEarningsNew guidance
Accelerating the hosted software shift is expected to lower recognized revenue in the short to medium term, without affecting ACV or cash flow.
Filed 2026-02-25 16:09 ET
- 2.02 Results of Operations
- 9.01 Financial Statements and Exhibits
Summary
Q4 and FY2025 results with 2026 outlook and 2028 financial objectives. FY2025 revenue grew 23.3%, while Q4 revenue fell 1.2% Y/Y and software revenue fell 13%, partly because upfront revenue from 2024 multi-year contracts had been recognized earlier. Schrödinger is accelerating its shift to hosted software: it expects short-to-medium-term declines in software revenue recognition, but says ACV and cash flow will be unaffected.
Key Figures
| Metric | Q4 2025 | Q4 2024 | Y/Y |
|---|---|---|---|
| Revenue | $87.2M | — | (1.2%) |
| Net income (loss) | $32.5M | $(40.2)M | n/m |
| Adjusted EBITDA (non-GAAP) | $(5.25)M | $(6.62)M | 20.7% improvement |
| Metric | FY2025 | FY2024 | Y/Y |
|---|---|---|---|
| Revenue | $255.9M | $207.5M | 23.3% |
| Operating loss | $(166.9)M | $(209.3)M | 20.3% improvement |
| Net loss | $(103.3)M | $(187.1)M | 44.8% improvement |
| Adjusted EBITDA (non-GAAP) | $(114.9)M | $(152.5)M | 24.7% improvement |
| Diluted EPS | $(1.41) | $(2.57) | 45.1% improvement |
| Operating cash flow | $13.9M | $(157.4)M | n/m |
- Q4 software revenue was $69.3M, down 13% Y/Y, primarily from accelerated recognition of upfront revenue on multi-year agreements signed in 2024, partly offset by higher hosted revenue. Drug discovery revenue was $18.0M vs $8.7M. Software gross margin was 81%; operating expenses were $74.5M, down 12.2%.
- FY2025 software revenue was $199.5M, up 10.6%; drug discovery revenue was $56.4M vs $27.2M. Software gross margin was 74%, and operating expenses were $309.5M, down 9.3%. Net loss improvement included $64.6M of other income, including changes in fair value of equity investments.
- FY2025 software ACV was $198.5M, up 4.0%; Top 20 Pharma ACV was $80.8M, up 15.3%. Commercial-customer net dollar retention was 100% vs 113%, while gross dollar retention was 96% in both years. Hosted revenue was 23% of software revenue vs 20%.
- Cash, cash equivalents, restricted cash and marketable securities totaled $402.3M at 12/31/2025 vs $367.5M a year earlier.
Guidance
| Metric | Period | Guidance | Prior | Direction |
|---|---|---|---|---|
| Software ACV | FY2026 | $218M-$228M; 10%-15% growth Y/Y | — | — |
| Drug discovery revenue | FY2026 | $55M-$65M | — | — |
| Operating expenses | FY2026 | Below FY2025 | — | — |
| Software ACV | Q1 2026 | $24M-$28M | — | — |
| Software ACV, trailing four-quarter basis | Q1 2026 | $197M-$201M | — | — |
| Software ACV growth | Annually through FY2028 | 10%-15% | — | Initiated |
| Hosted software transition | By FY2028 | Substantially complete; revenue to converge with ACV | — | Initiated |
| Software gross margin | FY2028 objective | Return to high 70s | — | Initiated |
| Drug discovery revenue | Annually through FY2028 | $50M, with potential milestone-timing variability | — | Initiated |
| Adjusted EBITDA (non-GAAP) | By year-end 2028 | Positive | — | Initiated |
Investor Takeaways
- Hosted deployment is expected to become the majority of software contracts by 2028; track software revenue during the transition alongside ACV and cash flow, which the company expects not to be affected.
- Schrödinger expects to present initial SGR-3515 data in Q2 2026; the update and progress on strategic partnerships are upcoming milestones.
- Progress toward positive adjusted EBITDA by year-end 2028 depends on software ACV growth, the hosted transition, software gross-margin recovery and expense discipline.
The summary is written by an AI model reading the filing.
Model 005 · prompt 01d34d48e3