Schrödinger Reports Third Quarter 2025 Financial Results

NEW YORK--( BUSINESS WIRE)-- Schrödinger, Inc. (Nasdaq: SDGR) today announced financial results for the quarter ended September 30, 2025.

"Schrödinger delivered a solid third quarter with software revenue growth of 28%, reflecting the industry’s increasing demand for our leading computational platform,” said Ramy Farid, Ph.D., chief executive officer of Schrödinger. “While we are encouraged by the continued high level of customer engagement as the macroeconomic pressures that have affected the industry stabilize, we have lowered our software revenue growth guidance by two percent to 8% to 13%. This updated guidance reflects current expectations regarding the timing of pharma scale-up opportunities.”

“In our therapeutics portfolio, we are continuing to make strong progress advancing our collaborations and have increased our expectations for drug discovery revenue this year. Beyond our planned clinical investments to complete the Phase 1 dose-escalation studies for SGR-1505 and SGR-3515, we do not intend to advance discovery programs into the clinic independently. This shift toward a discovery-focused therapeutics R&D model has the potential to deliver significant long-term value through licensing, new ventures, and discovery collaborations,” Dr. Farid continued. “These actions, coupled with expense-reduction measures we undertook earlier this year, are expected to result in savings of approximately $70 million and improve our operational efficiency and long-term profitability profile.”

Third Quarter 2025 Financial Results

Three Months Ended

September 30,

2025

2024

% Change

(in millions)

Total revenue

54.3

35.3

Software revenue

40.9

31.9

Drug discovery revenue

13.5

3.4

295

Software gross margin

Operating expenses

74.0

86.2

(14

Other income

13.3

30.2

—

Net loss

(32.8

)

(38.1

)

—

For the three and nine months ended September 30, 2025 Schrödinger reported a GAAP net loss of $32.8 million and $135.8 million, respectively, compared to a GAAP net loss of $38.1 million and $146.9 million for the three and nine months ended September 30, 2024, respectively. For the three and nine months ended September 30, 2025, Schrödinger reported a non-GAAP net loss of $42.3 million and $136.5 million, respectively, compared to a non-GAAP net loss of $63.7 million and $174.2 million for the three and nine months ended September 30, 2024, respectively. See “Non-GAAP Information” below and the table at the end of this press release for a reconciliation of non-GAAP net loss to GAAP net loss.

2025 Financial Outlook

Today Schrödinger updated its 2025 full-year guidance for software revenue growth, drug discovery revenue, and software gross margin. The company’s financial expectations for the fiscal year ending December 31, 2025 are as follows:

Key Highlights

Pipeline

In October, the U.S. Food and Drug Administration granted SGR-1505 Orphan Drug Designation for the treatment of Waldenström macroglobulinemia.

Additionally, Schrödinger scientists recently published research in the Journal of Medicinal Chemistry highlighting the power of integrating physics-based modeling and machine learning to accelerate the discovery of SGR-1505.

Platform

Collaborations

Webcast and Conference Call Information

Schrödinger will host a conference call to discuss its third quarter 2025 financial results on Wednesday, November 5, 2025, at 4:30 p.m. ET. The live webcast can be accessed under “Events & Presentations” in the investors section of Schrödinger’s website, https://ir.schrodinger.com/news-and-events/event-calendar. To participate in the live call, please register for the call here. It is recommended that participants register at least 15 minutes in advance of the call. Once registered, participants will receive the dial-in information. The archived webcast will be available on Schrödinger’s website for approximately 90 days following the event.

Non-GAAP Information

Included in this press release is certain financial information that has not been prepared in accordance with generally accepted accounting principles in the United States (GAAP). The company presents non-GAAP net income (loss) and non-GAAP net income (loss) per share, which exclude gains and losses on equity investments, changes in fair value of equity investments, and income tax benefits and expenses. Adjusting net income to exclude the impact of these items results in a financial presentation for the company without the impact of our equity investments and tax benefits and expenses. Management believes non-GAAP net income (loss) and non-GAAP net income (loss) per share are useful measures for investors, taken in conjunction with the company’s GAAP financial statements because they provide greater period-over-period comparability with respect to the company’s operating performance, by excluding non-cash mark-to-market and other valuation adjustments for the company’s equity investments, non-recurring cash distributions from the company’s equity investments and the tax impact of these distributions that are not reflective of the ongoing operating performance of the business. However, the non-GAAP measures should be considered only in addition to, not as a substitute for or as superior to, net income (loss) and net income (loss) per share or other financial measures prepared in accordance with GAAP.

Other companies in Schrödinger’s industry may calculate non-GAAP net income (loss) and non-GAAP net income (loss) per share, differently than we do, limiting their usefulness as comparative measures. For a reconciliation of non-GAAP net income (loss) and non-GAAP net income (loss) per share to GAAP net income (loss) and GAAP net income (loss) per share, respectively, please refer to the tables at the end of this press release.

About Schrödinger

Schrödinger is transforming molecular discovery with its computational platform, which enables the discovery of novel, highly optimized molecules for drug development and materials design. Schrödinger’s software platform is built on more than 30 years of R&D investment and is licensed by biotechnology, pharmaceutical and industrial companies, and academic institutions around the world. Schrödinger also leverages the platform to advance a portfolio of collaborative and internal programs. Founded in 1990, Schrödinger has approximately 800 employees operating from 15 locations globally. To learn more, visit www.schrodinger.com, follow us on LinkedIn and Instagram, or visit our blog, Extrapolations.com.

Cautionary Note Regarding Forward-Looking Statements

This press release contains forward-looking statements within the meaning of The Private Securities Litigation Reform Act of 1995 including, but not limited to those statements regarding Schrödinger’s expectations about the speed and capacity of its computational platform, its financial outlook for the fiscal year ending December 31, 2025, its plans to continue to invest in research and its strategic plans to accelerate the growth of its software business and advance its collaborative and proprietary drug discovery programs, its ability to realize potential benefits and estimated savings from the restructuring and other cost reductions, including the phasing out of independent clinical development activities, the long-term potential of its business, its ability to improve and advance the science underlying its platform, including its ability to improve drug discovery, the initiation, timing, progress, and results of its proprietary drug discovery programs and product candidates and the drug discovery programs and product candidates of its collaborators, the clinical potential and favorable properties of its product candidates, including SGR-1505 and SGR-3515, its MALT1 and Wee1/Myt1 inhibitors, the clinical potential and favorable properties of its collaborators’ product candidates, the potential for SGR-1505 to be used for the treatment of relapsed/refractory B-cell malignancies, including Waldenström macroglobulinemia, its plans to explore strategic opportunities for the continued clinical development of SGR-1505, potential partnering and other business development activities for its programs, including SGR-6016, as well as expectations related to the use of its cash, cash equivalents and marketable securities. Statements including words such as “aim,” “anticipate,” “believe,” “contemplate,” “continue,” “could,” “estimate,” “expect,” “goal,” “intend,” “may,” “might,” “plan,” “potential,” “predict,” “project,” “should,” “target,” “will,” “would” and statements in the future tense are forward-looking statements. These forward-looking statements reflect Schrödinger’s current views about its plans, intentions, expectations, strategies and prospects, which are based on the information currently available to the company and on assumptions the company has made. Actual results may differ materially from those described in these forward-looking statements and are subject to a variety of assumptions, uncertainties, risks and important factors that are beyond Schrödinger’s control, including the demand for its software platform, its ability to further develop its computational platform, its reliance upon third-party providers of cloud-based infrastructure to host its software solutions, factors adversely affecting the life sciences industry, fluctuations in the value of the U.S. dollar and foreign currencies, its reliance upon its third-party drug discovery collaborators, the uncertainties inherent in drug development and commercialization, such as the conduct of research activities and the timing of and its ability to initiate and complete preclinical studies and clinical trials, whether results from preclinical studies will be predictive of the results of later preclinical studies and clinical trials, uncertainties associated with the regulatory review of IND submissions, clinical trials and applications for marketing approvals, the ability to retain and hire key personnel and other risks detailed under the caption “Risk Factors” and elsewhere in the company’s Securities and Exchange Commission filings and reports, including its Quarterly Report on Form 10-Q for the quarterly period ended September 30, 2025, filed with the Securities and Exchange Commission on November 5, 2025, as well as future filings and reports by the company. Any forward-looking statements contained in this press release speak only as of the date hereof. Except as required by law, Schrödinger undertakes no duty or obligation to update any forward-looking statements contained in this press release as a result of new information, future events, changes in expectations or otherwise.

Condensed Consolidated Statements of Operations (Unaudited)

(in thousands, except for share and per share amounts)

Three Months Ended September 30,

Nine Months Ended September 30,

2025

2024

2025

2024

Revenues:

Software products and services

40,858

31,884

130,218

100,703

Drug discovery

13,466

3,406

38,416

18,519

Total revenues

54,324

35,290

168,634

119,222

Cost of revenues:

Software products and services

11,111

8,479

37,662

23,622

Drug discovery

15,174

9,083

45,651

27,647

Total cost of revenues

26,285

17,562

83,313

51,269

Gross profit

28,039

17,728

85,321

67,953

Operating expenses:

Research and development

42,757

50,977

131,739

152,423

Sales and marketing

9,524

10,349

30,625

30,213

General and administrative

21,705

24,824

72,696

73,901

Total operating expenses

73,986

86,150

235,060

256,537

Loss from operations

(45,947

)

(68,422

)

(149,739

)

(188,584

)

Other income:

Gain (loss) on equity investments

—

Change in fair value of equity investments

9,691

25,459

1,175

27,763

Other income

3,623

4,737

13,265

14,363

Total other income

13,314

30,196

14,440

42,126

Loss before income taxes

(32,633

)

(38,226

)

(135,299

)

(146,458

)

Income tax expense (benefit)

162

(90

)

477

449

Net loss

(32,795

)

(38,136

)

(135,776

)

(146,907

)

Net loss per share of common and limited common stockholders, basic and diluted:

(0.45

)

(0.52

)

(1.85

)

(2.02

)

Weighted average shares used to compute net loss per share of common and limited common stockholders, basic and diluted:

73,613,090

72,813,006

73,368,247

72,606,033

Condensed Consolidated Balance Sheets (Unaudited)

(in thousands, except for share and per share amounts)

Assets

September 30, 2025

December 31, 2024

Current assets:

Cash and cash equivalents

172,120

147,326

Restricted cash

9,753

15,331

Marketable securities

219,113

204,798

Accounts receivable, net of allowance for doubtful accounts of $420 and $210

29,384

235,692

Unbilled and other receivables, net of allowance for unbilled receivables of $140 and $100

28,016

19,641

Prepaid expenses

13,336

12,205

Total current assets

471,722

634,993

Property and equipment, net

20,738

24,196

Equity investments

44,382

43,208

Goodwill

4,791

Right of use assets - operating leases

105,107

111,883

Other assets

6,920

4,155

Total assets

653,660

823,226

Liabilities and Stockholders' Equity:

Current liabilities:

Accounts payable

9,218

10,666

Accrued payroll, taxes, and benefits

27,986

42,110

Deferred revenue

82,283

111,944

Lease liabilities - operating leases

16,740

16,755

Other accrued liabilities

8,886

10,272

Total current liabilities

145,113

191,747

Deferred revenue, long-term

92,390

108,814

Lease liabilities - operating leases, long-term

94,694

101,074

Other liabilities, long-term

111

146

Total liabilities

332,308

401,781

Stockholders' equity:

Preferred stock, $0.01 par value. Authorized 10,000,000 shares; zero shares issued and outstanding at September 30, 2025 and December 31, 2024, respectively

—

Common stock, $0.01 par value. Authorized 500,000,000 shares; 64,470,221 and 63,710,409 shares issued and outstanding at September 30, 2025 and December 31, 2024 , respectively

645

637

Limited common stock, $0.01 par value. Authorized 100,000,000 shares; 9,164,193 shares issued and outstanding at September 30, 2025 and December 31, 2024, respectively

Additional paid-in capital

981,853

946,037

Accumulated deficit

(661,317

)

(525,541

)

Accumulated other comprehensive income

220

Total stockholders' equity

321,352

421,445

Total liabilities and stockholders' equity

653,660

823,226

Condensed Consolidated Statements of Cash Flows (Unaudited)

(in thousands)

Nine Months Ended September 30,

2025

2024

Cash flows from operating activities:

Net loss

(135,776

)

(146,907

)

Adjustments to reconcile net loss to net cash used in operating activities:

(Gain) loss on equity investments

—

Fair value adjustments of equity investments

(1,175

)

(27,763

)

Depreciation and amortization

4,585

4,395

Stock-based compensation

33,047

37,424

Noncash investment accretion

(2,347

)

(6,260

)

Loss on disposal of property and equipment

Decrease (increase) in assets:

Accounts receivable, net

206,308

52,711

Unbilled and other receivables

(8,375

)

(8,418

)

Reduction in the carrying amount of right of use assets - operating leases

6,776

7,914

Prepaid expenses and other assets

(3,896

)

(5,314

)

(Decrease) increase in liabilities:

Accounts payable

(1,302

)

(5,442

)

Accrued payroll, taxes, and benefits

(14,124

)

1,848

Deferred revenue

(46,085

)

(18,301

)

Lease liabilities - operating leases

(6,395

)

(7,738

)

Other accrued liabilities

(1,269

)

(4,412

)

Net cash provided by (used in) operating activities

29,992

(126,255

)

Cash flows from investing activities:

Purchases of property and equipment

(1,401

)

(6,438

)

Purchases of equity investments

—

(3,000

)

Proceeds from disposition and sale of equity investments

—

48,798

Purchases of marketable securities

(243,707

)

(187,466

)

Proceeds from maturity of marketable securities

231,598

273,467

Net cash (used in) provided by investing activities

(13,510

)

125,361

Cash flows from financing activities:

Proceeds from issuances of common stock upon stock option exercises

2,777

1,356

Principal payments on finance leases

(43

)

(43

)

Proceeds from issuance of common stock in ATM offering, net

—

8,691

Net cash provided by financing activities

2,734

10,004

Net increase in cash and cash equivalents and restricted cash

19,216

9,110

Cash and cash equivalents and restricted cash, beginning of period

162,657

161,066

Cash and cash equivalents and restricted cash, end of period

181,873

170,176

Supplemental disclosure of cash flow and noncash information

Cash paid for income taxes

650

847

Supplemental disclosure of non-cash investing and financing activities

Purchases of property and equipment in accounts payable

Purchases of property and equipment in accrued liabilities

138

Acquisition of right of use assets - operating leases, contingency resolution

—

2,848

Reconciliation of GAAP to Non-GAAP Financial Measures (Unaudited)

Three Months Ended

Nine Months Ended

September 30,

2025

2024

2025

2024

(in thousands, except per share data)

Net loss (GAAP)

(32,795

)

(38,136

)

(135,776

)

(146,907

)

Income tax expense (benefit)

162

(90

)

477

449

(Gain) loss on equity investments

—

Change in fair value

(9,691

)

(25,459

)

(1,175

)

(27,763

)

Non-GAAP net loss

(42,324

)

(63,685

)

(136,474

)

(174,221

)

Non-GAAP net loss per share of common and limited common stockholders, basic and diluted:

(0.57

)

(0.87

)

(1.86

)

(2.40

)

Weighted average shares used to compute non-GAAP net loss per share of common and limited common stockholders, basic and diluted:

73,613,090

72,813,006

73,368,247

72,606,033