Schrodinger Q3 revenue beats expectations on milestone payment

Overview

• Computational molecular discovery platform's Q3 revenue rose 19% yr/yr, beating analyst expectations

• Net loss widened to $37.7 mln from $32.8 mln last year

• Drug discovery revenue rose, helped by milestone payment from Structure Therapeutics

Outlook

• Schrodinger raises 2026 ACV guidance to $222 mln-$232 mln from $218 mln-$228 mln

• Company lifts 2026 drug discovery revenue outlook to $75 mln-$85 mln from $65 mln-$75 mln

• Operating expenses for 2026 expected to be less than in 2025

Result Drivers

• MILESTONE PAYMENT - Drug discovery revenue increase was primarily due to a milestone payment from Structure Therapeutics

• HOSTED SOFTWARE TRANSITION - Software gross margin fell 2% as company continued transition to hosted licenses

• OPERATING EXPENSES - Operating expenses decreased 13% yr/yr, contributing to improved operating results

Company press release:

Key Details

Analyst Coverage

• The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 5 "strong buy" or "buy", 2 "hold" and no "sell" or "strong sell"

• The average consensus recommendation for the software peer group is "buy"

• Wall Street's median 12-month price target for Schrodinger Inc is $24.00, about 11.7% below its November 3 closing price of $27.18

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(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)