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Schrodinger, Inc.

SDGR Healthcare Health Information Services

Schrodinger, Inc.’s revenue for fiscal 2025 (year ended December 2025) was $255.9 million, up 23.3% from fiscal 2024. In the quarter to June 2026, revenue grew 7.54%, EPS grew 113.6% and free cash flow grew 34.4%, each against the same quarter a year earlier.

22.60 2.88 −11.30%
Market cap
$1.9B
P/E
0.0×
Fwd P/E
−7.1×
Dividend yield
—
F-score
5/9
Altman Z
1.10
Beneish M
−3.47
Dividend safety
n/a
Overview Business Profile Financial Analysis Income Statement Balance Sheet Cash Flow Metrics & Ratios 10-Q 10-K

Schrodinger, Inc. (SDGR) Business Profile

Updated before January 2025

Company Overview

Schrödinger, Inc. (NASDAQ: SDGR) is a leading computational technology company that specializes in the development of advanced molecular simulation software for drug discovery and materials design. Founded in 1990 by Richard A. Friesner, a professor at Columbia University, the company is headquartered in New York City, with additional offices in the United States, Europe, and Asia. Schrödinger’s mission is to revolutionize the way scientists design and develop new drugs and materials by leveraging physics-based computational methods.

The company is led by a team of experienced executives and scientists. Dr. Ramy Farid serves as the President and Chief Executive Officer, bringing decades of expertise in computational chemistry and leadership. Other key members of the leadership team include Joel Lebowitz, Chief Financial Officer, and Dr. Karen Akinsanya, Chief Biomedical Scientist and Head of Discovery R&D. Schrödinger’s leadership is committed to advancing innovation and maintaining its position as a pioneer in computational science.

Core Business Segments

Schrödinger operates across two primary business segments: Software and Drug Discovery.

1. Software

Schrödinger’s software platform is the cornerstone of its business. The platform integrates physics-based molecular modeling with machine learning to enable researchers to predict molecular properties and behaviors with high accuracy. Key products and services under this segment include:

  • Maestro: Schrödinger’s flagship molecular modeling interface, which provides a comprehensive suite of tools for drug discovery and materials science.
  • LiveDesign: A collaborative platform that allows researchers to design, analyze, and share molecular data in real time.
  • FEP+ (Free Energy Perturbation): A tool that enables precise predictions of binding affinities, critical for drug discovery.
  • Materials Science Suite: A set of tools designed for the discovery and optimization of new materials, including polymers, catalysts, and semiconductors.

Schrödinger’s software is widely used by pharmaceutical companies, biotechnology firms, and academic institutions to accelerate research and development processes.

2. Drug Discovery

In addition to its software offerings, Schrödinger has a growing drug discovery business. The company collaborates with pharmaceutical and biotechnology companies to co-develop novel therapeutics. Schrödinger leverages its computational platform to identify promising drug candidates and optimize their properties. Notable collaborations include partnerships with Bristol Myers Squibb, Takeda, and Sanofi.

Schrödinger also invests in its own internal drug discovery programs, focusing on oncology, immunology, and other therapeutic areas. These programs aim to advance drug candidates into clinical trials and eventually bring them to market.

Business Model

Schrödinger’s business model is built on a combination of software licensing, collaborative partnerships, and internal drug discovery efforts. The company generates revenue through:

  • Software Licensing: Schrödinger licenses its software to a diverse range of customers, including pharmaceutical companies, academic institutions, and materials science organizations. The company offers both subscription-based and perpetual licensing models.
  • Collaborative Partnerships: Schrödinger collaborates with industry partners to co-develop drug candidates. These partnerships often include milestone payments, royalties, and equity stakes.
  • Internal Drug Discovery: Schrödinger invests in its own drug discovery programs, with the goal of advancing candidates into clinical trials and securing licensing agreements or commercialization opportunities.

This diversified approach allows Schrödinger to balance recurring revenue from software sales with the potential for high-value returns from drug discovery.

Strategic Direction

Schrödinger is focused on expanding its impact across the life sciences and materials science industries. Key strategic priorities include:

  • Software Innovation: Schrödinger continues to enhance its software platform by integrating machine learning and artificial intelligence capabilities. The company aims to improve the accuracy and efficiency of its tools, enabling researchers to make faster and more informed decisions.
  • Drug Discovery Growth: Schrödinger plans to expand its internal drug discovery pipeline and establish new partnerships with pharmaceutical companies. The company is particularly focused on advancing candidates in oncology and immunology.
  • Global Expansion: Schrödinger is increasing its presence in key markets, including Asia and Europe, to reach a broader customer base.
  • Sustainability Goals: Schrödinger is committed to sustainability and aims to reduce the environmental impact of its operations. The company is exploring ways to use its computational tools to develop more sustainable materials and processes.

Competitive Landscape

Schrödinger operates in a competitive environment, facing competition from both established companies and emerging startups. Key competitors include:

  • Biovia (Dassault Systèmes): A provider of scientific software solutions for life sciences and materials science.
  • OpenEye Scientific Software: A company specializing in molecular modeling and cheminformatics tools.
  • Cresset: A developer of computational chemistry software for drug discovery.
  • Materials Design, Inc.: A competitor in the materials science software space.
  • Emerging Startups: Several startups are entering the computational drug discovery space, leveraging advancements in AI and machine learning.

Despite the competition, Schrödinger differentiates itself through its proprietary physics-based methods, strong customer relationships, and integrated approach to software and drug discovery.

Risk Factors

Schrödinger faces several risks that could impact its business:

  • Market Dependence: The company relies heavily on the pharmaceutical and biotechnology industries, which are subject to economic and regulatory fluctuations.
  • R&D Challenges: Drug discovery is inherently risky, with a high failure rate for clinical candidates.
  • Supply Chain Disruptions: While Schrödinger’s software business is less affected by physical supply chains, its drug discovery efforts could face challenges related to manufacturing and distribution.
  • Competition: The computational drug discovery market is becoming increasingly competitive, with new entrants and technological advancements.
  • Regulatory Risks: Schrödinger’s drug discovery programs are subject to stringent regulatory requirements, which could delay or prevent the approval of new drugs.

Recent Developments

Schrödinger has made significant progress in recent years, including:

  • New Software Features: The company has introduced advanced machine learning capabilities to its platform, improving the accuracy and speed of molecular simulations.
  • Partnerships: Schrödinger has entered into new collaborations with leading pharmaceutical companies, including a multi-year partnership with Bristol Myers Squibb.
  • Clinical Progress: Schrödinger’s internal drug discovery programs have advanced several candidates into preclinical and clinical development stages.
  • Global Expansion: The company has opened new offices in Asia and Europe to support its growing customer base.

Investment Considerations

Strengths

  • Innovative Technology: Schrödinger’s physics-based computational platform is a leader in the industry.
  • Diverse Revenue Streams: The company generates revenue from software licensing, partnerships, and internal drug discovery.
  • Strong Partnerships: Schrödinger collaborates with top pharmaceutical companies, providing a steady stream of revenue and opportunities for growth.
  • Growing Market: The demand for computational drug discovery and materials science tools is increasing, driven by advancements in AI and machine learning.

Risks

  • High R&D Costs: Drug discovery is expensive and carries a high risk of failure.
  • Competition: Schrödinger faces competition from established players and startups.
  • Regulatory Challenges: The company’s drug discovery programs are subject to regulatory scrutiny.
  • Market Volatility: Schrödinger’s stock price may be affected by market conditions and investor sentiment.

Conclusion

Schrödinger, Inc. is a pioneer in computational science, offering innovative software solutions and advancing drug discovery through its integrated platform. The company’s strong technology foundation, diverse revenue streams, and strategic partnerships position it for long-term growth. While Schrödinger faces risks related to competition and R&D challenges, its commitment to innovation and global expansion provides a solid foundation for future success. Investors should consider Schrödinger’s strengths and risks when evaluating it as a potential investment opportunity.