Schrodinger Q2 Earnings Call Highlights

Second-quarter ACV rose 27% year over year to $29.6 million , driven by broader demand from pharmaceutical, biotech and materials-science customers. Revenue reached $58.9 million, while net income improved to $6 million from a $43 million loss a year earlier.

Schrödinger launched early access for Bunsen , an agentic AI co-scientist, and signed a strategic software agreement with Bristol Myers Squibb. The company is also seeing growth from new offerings including Predictive Toxicology and RetroSynth.

Management maintained 2026 ACV guidance of $218 million to $228 million but raised drug-discovery revenue guidance to $65 million-$75 million, reflecting a $10 million Ajax Therapeutics collaboration milestone.

Second-quarter ACV was $29.6 million, up 27% from a year earlier. ACV excluding contribution revenue was $22.6 million, an increase of 23% year over year and at the upper end of the company’s expectations, Chief Financial Officer Richie Jain said.

First-half ACV totaled $58 million, representing 19% growth from the comparable 2025 period, while trailing four-quarter ACV reached $208 million.

The biopharma industry is increasingly recognizing that a computationally driven predict-first approach is a critical driver for accelerating drug discovery timelines and improving probabilities of success,” President and CEO Ramy Farid said.

Total revenue for the second quarter was $58.9 million. Software revenue was $32.5 million, including $15.2 million of hosted revenue, or 47% of the software total. That compared with hosted revenue representing 31% of software revenue in the second quarter of 2025.

Jain said the company’s planned transition toward hosted licenses continues to affect reported revenue growth because hosted-contract revenue is recognized ratably over the contract term rather than primarily upfront.

Schrodinger said each 1-percentage-point increase in hosted revenue can temporarily reduce reported revenue by $2 million to $3 million, depending on renewal timing and contract duration.

Software gross margin was 71%, compared with 76% a year earlier, reflecting the hosted-licensing transition.

Contribution revenue was $3.4 million, down from $4.8 million in the prior-year quarter, primarily because initial Gates Foundation funding for the company’s Predictive Toxicology initiative had been completed. The decline was partly offset by a Gates Ventures grant supporting battery research.

Drug discovery revenue increased to $23 million from $13.9 million in the prior-year period, primarily due to a $10 million collaboration milestone from Ajax Therapeutics. Total other income was $48.9 million, primarily associated with the completion of Eli Lilly’s acquisition of Ajax.

Operating expenses declined 6% year over year to $74 million, which Jain attributed to lower headcount, contract research organization costs and professional-services fees.

The company reported net income of $6 million, compared with a net loss of $43 million in the second quarter of 2025, and ended the quarter with $419 million in cash and marketable securities.

Schrodinger launched Bunsen in early access during the quarter. Farid described the product as an A...