Schrödinger, Inc.

Q2 2026 ACV was $29.6 million, up 27% year over year; ACV excluding contribution was $22.6 million, up 23%. First-half 2026 ACV was $58.0 million, up 19% year over year, and trailing four-quarter ACV reached $208 million. Total revenue was $58.9 million, including software revenue of $32.5 million and drug discovery revenue of $23 million versus $13.9 million in Q2 2025; software gross margin was 71% versus 76% a year ago. Hosted revenue was $15.2 million, or 47% of software revenue, and total operating expenses were $74 million, down 6% year over year from $79 million. Net income was $6 million versus a net loss of $43 million in Q2 2025, and the company ended with $419 million in cash and marketable securities. For full-year 2026, ACV is still expected to be $218 million to $228 million, or 10% to 15% growth over 2025; drug discovery revenue guidance was raised to $65 million to $75 million from $55 million to $65 million. For Q3 2026, ACV excluding contribution is expected to be $41 million to $45 million.

Ramy Farid emphasized that the company is seeing stronger industry recognition of a “predict-first” computational approach in drug discovery, supported by 27% ACV growth and improved customer demand. He framed Bunsen and predictive tox as important examples of products that expand platform usage and open new budgets, and said BMS is a compelling model for broader deployment. His tone was constructive and confident, stressing innovation, platform expansion, and long-term value creation across software and therapeutics.

Richie Jain highlighted strong execution across both businesses, calling out robust ACV growth, faster hosted revenue adoption, disciplined expense control, and a strong balance sheet. He noted software gross margin of 71% versus 76% last year, and said the margin pressure is tied to the planned shift to hosted licensing, where revenue is recognized ratably and each 1% increase in hosted revenue can reduce reported revenue by $2 million to $3 million. He also said operating expenses fell to $74 million, down 6% year over year, and that the company ended with $419 million in cash and marketable securities. On guidance, he kept full-year ACV at $218 million to $228 million, raised drug discovery revenue guidance to $65 million to $75 million because of the Ajax milestone, and guided Q3 ACV excluding contribution to $41 million to $45 million.

Analysts focused on end-market health, Bunsen’s commercial model, the pace of hosted-license conversion, new-product-driven ACV, expense discipline, and predictive tox. Management said biotech conditions are better than last year, citing more IPOs and less customer funding stress, while declining to break out predictive tox ACV but confirming it has contributed this year and should keep contributing for years. On Bunsen, management said BMS significantly scaled up access and that value will be recognized through increased technology usage under the throughput-based model. On hosted licensing, Richie said the company remains on track toward 75% hosted by the end of 2028, with customer engagement strong.