Achieved Fourth Quarter Software Revenue of $68.7 Million, a 44% Increase Over Fourth Quarter 2022

Delivered 20% Annual Total Revenue Growth, with Total Revenue of $216.7 Million

Expects Software Revenue Growth of 6% to 13% in 2024

Schr�dinger, Inc. (Nasdaq: SDGR), whose physics-based computational platform is transforming the way therapeutics and materials are discovered, today announced financial results for the fourth quarter and full-year ended December 31, 2023, and provided its financial outlook for 2024.

“I am very pleased with the progress we made in 2023, delivering 20 percent total revenue growth and reporting our largest quarter for software revenue in our history. We also advanced our pipeline of collaborative and proprietary programs and were pleased to see companies we co-founded achieve significant corporate and development milestones, further validating our platform,” said Ramy Farid, Ph.D., chief executive officer of Schr�dinger. “Looking ahead, we are continuing to focus on investing in the science that underlies our platform, increasing customer adoption, and advancing our proprietary pipeline, which now includes two clinical-stage programs. We expect data readouts from our first two patient studies in late 2024 or 2025 and are on track to progress a third program to the clinic this year.”

Fourth Quarter 2023 Financial Results

  • Total revenue for the fourth quarter increased 30.4% to $74.1 million, compared to $56.8 million in the fourth quarter of 2022.
  • Software revenue for the fourth quarter increased 43.6% to $68.7 million, compared to $47.8 million in the fourth quarter of 2022. Multi-year agreements contributed significantly to revenue in the quarter with additional contribution from larger renewals of annual contracts among existing customers.
  • Drug discovery revenue was $5.5 million for the fourth quarter, compared to $9.0 million in the fourth quarter of 2022. The decrease reflects collaboration milestones that favorably impacted the fourth quarter of 2022.
  • Software gross margin increased to 87% for the fourth quarter, compared to 83% in the fourth quarter of 2022.
  • Operating expenses were $87.2 million for the fourth quarter, compared to $67.2 million for the fourth quarter of 2022.
  • Other expense, which includes changes in fair value of equity investments and interest income/expense, was $1.9 million for the fourth quarter, compared to other income of $1.2 million for the fourth quarter of 2022.
  • Net loss for the fourth quarter was $30.7 million, compared to $27.2 million in the fourth quarter of 2022.

 

Three Months Ended

December 31,

 

 

2023

 

 

 

2022

 

 

% Change

 

(in millions)

 

Total revenue

$

74.1

 

$

56.8

 

30.4

%

Software revenue

 

68.7

 

 

47.8

 

43.6

%

Drug discovery revenue

 

5.5

 

 

9.0

 

(39.4

)%

Software gross margin

 

87

%

 

83

%

 

Operating expenses

$

87.2

 

$

67.2

 

29.6

%

Other (expense) income

$

(1.9

)

$

1.2

 

(258.4

)%

Net loss

$

(30.7

)

$

(27.2

)

12.7

%

Full Year 2023 Financial Results

  • Total revenue for the full year increased 19.7% to $216.7 million, compared to $181.0 million for 2022.
  • Software revenue for the full year increased 17.4% to $159.1 million, compared to $135.6 million for 2022. Multi-year agreements contributed significantly to revenue growth with additional contribution from larger renewals of annual contracts among existing customers.
  • Drug discovery revenue for the full year was $57.5 million compared to $45.4 million for 2022. The first quarter of 2023 included a $25.0 million milestone from BMS.
  • Software gross margin was 81% for the full year, compared to 78% for 2022.
  • Operating expenses were $318.1 million for the full year, compared to $247.8 million for 2022, primarily due to higher research and development expense.
  • Other income, which includes gains/loss on equity investments, changes in fair value of such investments and interest income/expense, was $220.4 million for the full year, compared to other expense of $2.3 million for 2022.
  • Net income for the full year was $40.7 million, compared to a loss of $149.2 million for 2022.
  • At December 31, 2023, Schr�dinger had cash, cash equivalents, restricted cash and marketable securities of approximately $468.8 million, compared to approximately $502.5 million at September 30, 2023 and $456.3 million at December 31, 2022. In the first half of 2023, Schr�dinger received $147.2 million in ​​cash distributions from Nimbus Therapeutics in connection with Takeda’s acquisition of Nimbus Lakshmi, Inc., a wholly-owned subsidiary of Nimbus, and its tyrosine kinase 2 inhibitor.

 

Twelve Months Ended

 

December 31,

 

 

2023

 

 

 

2022

 

 

% Change

 

(in millions)

 

 

 

 

Total revenue

$

216.7

 

 

$

181.0

 

 

19.7

%

Software revenue

 

159.1

 

 

 

135.6

 

 

17.4

%

Drug discovery revenue

 

57.5

 

 

 

45.4

 

 

26.8

%

Software gross margin

 

81

%

 

 

78

%

 

 

Operating expenses

$

318.1

 

 

$

247.8

 

 

28.4

%

Other income (expense)

$

220.4

 

 

$

(2.3

)

 

(9,643.8

)%

Net income (loss)

$

40.7

 

 

$

(149.2

)

 

(127.3

)%

For the three and twelve months ended December 31, 2023, Schr�dinger reported a net loss of $30.7 million and net income of $40.7 million, respectively, compared to net losses of $27.2 million and $149.2 million for the three and twelve months ended December 31, 2022, respectively.

For the three and twelve months ended December 31, 2023, Schr�dinger reported non-GAAP net losses of $23.0 million and $157.8 million, respectively, compared to non-GAAP net losses of $25.9 million and $142.9 million for the three and twelve months ended December 31, 2022, respectively. See “Non-GAAP Information” below and the table at the end of this press release for a reconciliation of non-GAAP net income (loss) to GAAP net income (loss).

Full Year 2023 Key Performance Indicators (KPIs)

Schr�dinger today reported 2023 key performance indicators for both the software and drug discovery components of its business.

Software. Total annual contract value (ACV) increased 9.7% to $154.2 million, and the ACV of Top 10 customers also increased 9.7% to $51.0 million. The number of customers with an ACV of at least $1 million increased to 27 from 18, and the number of customers with an ACV of at least $5 million was unchanged at four. Schr�dinger’s customer retention rate among customers with an ACV of at least $500,000 was 98% and the number of such customers increased from 52 to 54.

Drug discovery. Schr�dinger ended 2023 with 12 ongoing programs eligible for royalties, compared to 15 the previous year. For the year ended December 31, 2023, the number of collaborators since 2018 was unchanged at 17.

Software KPI

2023

2022

Total annual contract value (ACV)

$154.2 million

$140.6 million

ACV of Top 10 customers

$51.0 million

$46.5 million

Number of customers with at least $5M in ACV

4

4

Number of customers with at least $1M in ACV

27

18

Number of customers with at least $500,000 in ACV

54

52

Number of customers with at least $100,000 in ACV

222

227

Customer retention rate with at least $500,000 in ACV

98%

100%

Customer retention with at least $100,000 ACV

92%

96%

Number of active customers with ACV of at least $1,000

1,785

1,748

 

 

Drug Discovery KPI

2023

2022

Ongoing programs eligible for royalties

12

15

Number of collaborators since 2018

17

17

For additional information about the company’s KPIs, see “Operating Metrics” below.

2024 Financial Outlook

As of February 28, 2024, Schr�dinger provided the following expectations for the fiscal year ending December 31, 2024:

  • Software revenue growth is expected to range from 6% to 13%.
  • Drug discovery revenue is expected to range from $30 million to $35 million.
  • Software gross margin is expected to be similar to software gross margin for the full year 2023.
  • Operating expense growth in 2024 is expected to range from 8% to 12%.
  • Cash used for operating activities in 2024 is expected to be above cash used for operating activities in 2023.

For the first quarter of 2024, software revenue is expected to range from $33 million to $35 million.

“We had a very strong year in 2023, with significant growth in our software and drug discovery revenue and substantial progress in our proprietary pipeline and at our co-founded companies. In 2023 we benefited from the renewal of large contracts with long-term software customers, as well as a significant increase in the number of customers with annual contract values over $1 million,” stated Geoff Porges, MBBS, chief financial officer of Schr�dinger. “We see many opportunities to drive continuing software revenue growth in 2024 and beyond, and are very excited by the value we are building in our proprietary portfolio, and in our ventures and partnerships.”

Key Highlights

Platform

  • In February, Schr�dinger scientists published commentary in Cell describing how free energy perturbation (FEP+) can be used to validate and optimize ML-predicted structures, increasing the number of targets that can be evaluated and enabling computational drug design against an increasing number of targets and off-targets such as hERG.
  • In December, Schr�dinger scientists co-authored a paper describing the application of induced-fit docking and FEP+ to significantly improve the utility of predicted structures of certain GPCRs. GPCRs are an important class of drug targets; however, obtaining experimental GPCR structures has been historically challenging. This research demonstrates the potential to leverage predicted structures, further expanding the domain of applicability for Schr�dinger’s platform.
  • In November, Schr�dinger and AbbVie scientists published a paper demonstrating that FEP+ can be used to accurately predict the thermodynamic aqueous solubility of small molecules, a critical attribute of drug candidates that can impact efficacy and drug formulation. Schr�dinger’s FEP+ exhibited better correlations to experimental solubility compared to state-of-the-art machine learning approaches.

Pipeline

  • In December, Schr�dinger presented initial data showing that its novel MALT1 inhibitor, SGR-1505, was well tolerated in a Phase 1 study of 73 healthy volunteers. No drug-related serious adverse events or dose limiting toxicities were observed in the study. The data also confirmed target engagement, with greater than 90 percent inhibition of IL-2 secretion in activated T cells, a pharmacodynamic goal of the study. Schr�dinger presented preclinical data for SGR-1505 at the American Society of Hematology (ASH) Annual Meeting in December. The data demonstrated that SGR-1505 has favorable attributes and the potential for combination activity with standard-of-care agents in B-cell malignancies. The company also presented preliminary clinical biomarker information for SGR-1505, showing pharmacodynamic evidence of MALT1 inhibition. The company continues to advance the Phase 1 dose-escalation study of SGR-1505 in relapse/refractory B-cell malignancy patients, and enrollment is ongoing in the U.S. and EU. The company expects to report initial data from this study in late 2024 or 2025.
  • Also at ASH, Schr�dinger presented preclinical data for SGR-2921, its CDC7 inhibitor, showing the anti-proliferative effects of SGR-2921 in treatment-resistant acute myeloid leukemia (AML) patient-derived samples, as well as reduction of blasts in multiple AML models. A Phase 1 study of SGR-2921 is ongoing in patients with AML or myelodysplastic syndrome, and the company expects to report initial data from the study in late 2024 or 2025.
  • Schr�dinger continues to progress SGR-3515, its Wee1/Myt1 inhibitor, through IND-enabling activities and expects an IND submission in the first half of 2024 and start a Phase 1 trial in the second half of 2024.
  • Schr�dinger is advancing its discovery pipeline, including three recently disclosed novel medicines targeting EGFRC797S, PRMT5-MTA and NLRP3. The company continues to anticipate submitting at least one IND in 2025.

Webcast and Conference Call Information

Schr�dinger will host a conference call to discuss its fourth quarter and full year 2023 financial results on Wednesday, February 28, 2024, at 4:30 p.m. ET. The live webcast can be accessed under “News & Events” in the investors section of Schr�dinger’s website, https://ir.schrodinger.com/events-and-presentations/default.aspx. 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 Schr�dinger’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 Schr�dinger’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 Schr�dinger

Schr�dinger is transforming the way therapeutics and materials are discovered. Schr�dinger has pioneered a physics-based computational platform that enables discovery of high-quality, novel molecules for drug development and materials applications more rapidly and at lower cost compared to traditional methods. The software platform is licensed by biopharmaceutical and industrial companies, academic institutions, and government laboratories around the world. Schr�dinger’s multidisciplinary drug discovery team also leverages the software platform to advance a portfolio of collaborative and proprietary programs to address unmet medical needs.

Founded in 1990, Schr�dinger has approximately 850 employees and is engaged with customers and collaborators in more than 70 countries. To learn more, visit www.schrodinger.com, follow us on LinkedIn and Instagram, or visit our blog, Extrapolations.com.

Operating Metrics

To supplement the financial measures presented in this press release and related conference call or webcast in accordance with generally accepted accounting principles in the United States (GAAP), Schr�dinger also presents certain other performance metrics, such as annual contract value and customer retention rate.

Annual Contract Value (ACV). Schr�dinger tracks the ACV for each customer. With respect to contracts that have a duration of one year or less, or contracts of more than one year in duration that are billed annually, ACV is defined as the contract value billed during the applicable period. For contracts with a duration of more than one year that are billed upfront, ACV in each period represents the total billed contract value divided by the term. ACV should be viewed independently of revenue and does not represent revenue calculated in accordance with GAAP on an annualized basis, as it is an operating metric that can be impacted by contract execution start and end dates and renewal rates. ACV is not intended to be a replacement for, or forecast of, revenue.

Customer Retention for our customers with an ACV of at least $100,000 or $500,000. Schr�dinger calculates year-over-year customer retention for its customers in this cohort by starting with the number of customers it had in the previous fiscal year. Schr�dinger then calculates how many of these customers were active customers in the current fiscal year. Schr�dinger then divides this number by the number of customers with an ACV of at least $100,000 or $500,000, as applicable, that Schr�dinger had in the previous fiscal year to arrive at the year-over-year customer retention rate for such customers.

Active Customers. Schr�dinger defines an active customer as a customer that had an ACV of at least $1,000 in the fiscal year. Schr�dinger uses $1,000 as a threshold for defining its active customers as this amount will generally exclude customers that only license its PyMOL software, which is its open-source molecular visualization system broadly available at low cost.

Ongoing programs eligible for royalties. Schr�dinger tracks the aggregate number of collaborative and partnered programs for which the Company is eligible to receive any amount of future royalties on sales, if any.

Numbers of collaborators since 2018. Schr�dinger tracks the aggregate number of collaborators that the Company has collaborated with, or partnered with, for drug discovery and drug development since 2018. The number of collaborators presented is a cumulative number and the Company only includes those collaborations from which the Company has derived revenue from since January 1, 2018.

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 Schr�dinger’s expectations about the speed and capacity of its computational platform, its financial outlook for the fiscal year ending December 31, 2024 and first quarter ending March 31, 2024, its plans to continue to invest in research and its strategic plans to accelerate the growth of its software licensing business and advance its collaborative and proprietary drug discovery programs, the long-term potential of its business, its ability to improve and advance the science underlying its platform, 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 CDC7, MALT1, and Wee1 inhibitors, including SGR-1505, SGR-2921, and SGR-3515, the clinical potential and favorable properties of its collaborators’ product candidates, 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 Schr�dinger’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 Schr�dinger’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 Annual Report on Form 10-K for the fiscal year ended December 31, 2023, filed with the Securities and Exchange Commission on February 28, 2024, 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, Schr�dinger 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)

 

 

 

 

 

Year Ended December 31,

 

 

 

2023

 

 

 

2022

 

 

 

2021

 

Revenues:

 

 

 

 

 

Software products and services

$

159,124

 

 

$

135,578

 

 

$

113,236

 

Drug discovery

 

57,542

 

 

 

45,377

 

 

 

24,695

 

Total revenues

 

216,666

 

 

 

180,955

 

 

 

137,931

 

Cost of revenues:

 

 

 

 

 

Software products and services

 

29,514

 

 

 

29,576

 

 

 

26,495

 

Drug discovery

 

46,460

 

 

 

50,357

 

 

 

45,816

 

Total cost of revenues

 

75,974

 

 

 

79,933

 

 

 

72,311

 

Gross profit

 

140,692

 

 

 

101,022

 

 

 

65,620

 

Operating expenses:

 

 

 

 

 

Research and development

 

181,766

 

 

 

126,372

 

 

 

90,904

 

Sales and marketing

 

37,226

 

 

 

30,642

 

 

 

22,150

 

General and administrative

 

99,148

 

 

 

90,825

 

 

 

64,009

 

Total operating expenses

 

318,140

 

 

 

247,839

 

 

 

177,063

 

Loss from operations

 

(177,448

)

 

 

(146,817

)

 

 

(111,443

)

Other income (expense):

 

 

 

 

 

Gain (loss) on equity investments

 

147,213

 

 

 

11,825

 

 

 

(1,781

)

Change in fair value

 

53,461

 

 

 

(18,084

)

 

 

11,359

 

Other income

 

19,693

 

 

 

3,950

 

 

 

1,057

 

Total other income (expense)

 

220,367

 

 

 

(2,309

)

 

 

10,635

 

Income (loss) before income taxes

 

42,919

 

 

 

(149,126

)

 

 

(100,808

)

Income tax expense

 

2,199

 

 

 

63

 

 

 

411

 

Net income (loss)

 

40,720

 

 

 

(149,189

)

 

 

(101,219

)

Net income (loss) attributable to noncontrolling interest

 

 

 

 

(3

)

 

 

(826

)

Net income (loss) attributable to Schr�dinger common and limited common stockholders

$

40,720

 

 

$

(149,186

)

 

$

(100,393

)

Net income (loss) per share attributable to Schr�dinger common and limited common stockholders, basic:

$

0.57

 

 

$

(2.10

)

 

$

(1.42

)

Weighted average shares used to compute net income (loss) per share attributable to Schr�dinger common and limited common stockholders, basic:

 

71,776,301

 

 

 

71,173,419

 

 

 

70,594,950

 

Net income (loss) per share attributable to Schr�dinger common and limited common stockholders, diluted:

$

0.54

 

 

$

(2.10

)

 

$

(1.42

)

Weighted average shares used to compute net income (loss) per share attributable to Schr�dinger common and limited common stockholders, diluted:

 

74,986,816

 

 

 

71,173,419

 

 

 

70,594,950

 

Condensed Consolidated Balance Sheets (Unaudited)

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

 

 

 

 

 

Assets

 

December 31,

2023

 

December 31,

2022

Current assets:

 

 

 

Cash and cash equivalents

$

155,315

 

 

$

90,474

 

Restricted cash

 

5,751

 

 

 

5,243

 

Marketable securities

 

307,688

 

 

 

360,613

 

Accounts receivable, net of allowance for doubtful accounts of $220 and $125

 

65,992

 

 

 

55,953

 

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

 

23,124

 

 

 

13,137

 

Prepaid expenses

 

9,926

 

 

 

8,569

 

Total current assets

 

567,796

 

 

 

533,989

 

Property and equipment, net

 

23,325

 

 

 

14,244

 

Equity investments

 

83,251

 

 

 

25,683

 

Goodwill

 

4,791

 

 

 

4,791

 

Intangible assets, net

 

 

 

 

587

 

Right of use assets - operating leases

 

117,778

 

 

 

105,982

 

Other assets

 

6,014

 

 

 

3,311

 

Total assets

$

802,955

 

 

$

688,587

 

Liabilities and Stockholders’ Equity

 

 

 

Current liabilities:

 

 

 

Accounts payable

$

16,815

 

 

$

9,470

 

Accrued payroll, taxes, and benefits

 

31,763

 

 

 

24,882

 

Deferred revenue

 

56,231

 

 

 

57,931

 

Lease liabilities - operating leases

 

16,868

 

 

 

11,006

 

Other accrued liabilities

 

11,996

 

 

 

5,510

 

Total current liabilities

 

133,673

 

 

 

108,799

 

Deferred revenue, long-term

 

9,043

 

 

 

25,598

 

Lease liabilities - operating leases, long-term

 

111,014

 

 

 

105,485

 

Other liabilities, long-term

 

667

 

 

 

800

 

Total liabilities

 

254,397

 

 

 

240,682

 

Stockholders’ equity:

 

 

 

Preferred stock, $0.01 par value. Authorized 10,000,000 shares; zero shares issued and outstanding at December 31, 2023 and December 31, 2022, respectively

 

 

 

 

 

Common stock, $0.01 par value. Authorized 500,000,000 shares; 62,977,316 and 62,163,739 shares issued and outstanding at December 31, 2023 and December 31, 2022, respectively

 

630

 

 

 

622

 

Limited common stock, $0.01 par value. Authorized 100,000,000 shares; 9,164,193 shares issued and outstanding at December 31, 2023 and December 31, 2022, respectively

 

92

 

 

 

92

 

Additional paid-in capital

 

885,973

 

 

 

828,700

 

Accumulated deficit

 

(338,418

)

 

 

(379,138

)

Accumulated other comprehensive loss

 

281

 

 

 

(2,382

)

Total stockholders’ equity of Schr�dinger stockholders

 

548,558

 

 

 

447,894

 

Noncontrolling interest

 

 

 

 

11

 

Total stockholders’ equity

 

548,558

 

 

 

447,905

 

Total liabilities and stockholders’ equity

$

802,955

 

 

$

688,587

 

Condensed Consolidated Statements of Cash Flows (Unaudited)

(in thousands)

 

 

 

 

 

Year Ended December 31,

 

 

 

2023

 

 

 

2022

 

 

 

2021

 

Cash flows from operating activities:

 

 

 

 

 

Net income (loss)

$

40,720

 

 

$

(149,189

)

 

$

(101,219

)

Adjustments to reconcile net income (loss) to net cash used in operating activities:

 

 

 

 

 

(Gain) loss on equity investments

 

(147,213

)

 

 

(11,825

)

 

 

1,781

 

Noncash revenue from equity investments

 

 

 

 

 

 

 

(107

)

Fair value adjustments

 

(53,461

)

 

 

18,084

 

 

 

(11,359

)

Depreciation and amortization

 

5,552

 

 

 

4,344

 

 

 

2,847

 

Stock-based compensation

 

47,841

 

 

 

39,630

 

 

 

26,490

 

Noncash research and development expenses

 

 

 

 

 

 

 

811

 

Noncash investment (accretion) amortization

 

(7,761

)

 

 

629

 

 

 

5,270

 

Loss on disposal of property and equipment

 

142

 

 

 

19

 

 

 

140

 

(Increase) decrease in assets, net of acquisition:

 

 

 

 

 

Accounts receivable, net

 

(10,039

)

 

 

(23,697

)

 

 

(321

)

Unbilled and other receivables

 

(9,987

)

 

 

(4,253

)

 

 

(5,187

)

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

 

7,766

 

 

 

7,287

 

 

 

5,799

 

Prepaid expenses and other assets

 

(8,462

)

 

 

(7,067

)

 

 

(1,121

)

Increase (decrease) in liabilities, net of acquisition:

 

 

 

 

 

Accounts payable

 

7,321

 

 

 

1,179

 

 

 

(411

)

Accrued payroll, taxes, and benefits

 

6,881

 

 

 

6,477

 

 

 

6,405

 

Deferred revenue

 

(18,256

)

 

 

(1,903

)

 

 

(1,028

)

Lease liabilities - operating leases

 

(3,694

)

 

 

1,900

 

 

 

(2,949

)

Other accrued liabilities

 

5,917

 

 

 

(1,298

)

 

 

3,490

 

Net cash used in operating activities

 

(136,733

)

 

 

(119,683

)

 

 

(70,669

)

Cash flows from investing activities:

 

 

 

 

 

Purchases of property and equipment

 

(13,403

)

 

 

(8,014

)

 

 

(7,167

)

Purchases of equity investments

 

(4,125

)

 

 

(600

)

 

 

(3,700

)

Distribution from equity investment

 

147,213

 

 

 

11,825

 

 

 

375

 

Proceeds from sale of equity investments

 

 

 

 

 

 

 

15,735

 

Acquisition, net of acquired cash

 

 

 

 

(6,427

)

 

 

 

Purchases of marketable securities

 

(320,624

)

 

 

(271,472

)

 

 

(414,802

)

Proceeds from maturity of marketable securities

 

383,973

 

 

 

364,711

 

 

 

392,747

 

Net cash provided by (used in) investing activities

 

193,034

 

 

 

90,023

 

 

 

(16,812

)

Cash flows from financing activities:

 

 

 

 

 

Issuances of common stock upon stock option exercises

 

9,440

 

 

 

2,110

 

 

 

7,927

 

Payment of offering costs

 

(373

)

 

 

 

 

 

 

Principal payments on finance leases

 

(19

)

 

 

 

 

 

 

Contribution by noncontrolling interest

 

 

 

 

 

 

 

25

 

Net cash provided by financing activities

 

9,048

 

 

 

2,110

 

 

 

7,952

 

Net increase (decrease) in cash and cash equivalents and restricted cash

 

65,349

 

 

 

(27,550

)

 

 

(79,529

)

Cash and cash equivalents and restricted cash, beginning of year

 

95,717

 

 

 

123,267

 

 

 

202,796

 

Cash and cash equivalents and restricted cash, end of year

$

161,066

 

 

$

95,717

 

 

$

123,267

 

 

 

 

 

 

 

Supplemental disclosure of cash flow and noncash information

 

 

 

 

 

Cash paid for income taxes

$

2,828

 

 

$

787

 

 

$

448

 

Supplemental disclosure of non-cash investing and financing activities

 

 

 

 

 

Purchases of property and equipment in accounts payable

 

192

 

 

 

169

 

 

 

705

 

Purchases of property and equipment in accrued liabilities

 

457

 

 

 

293

 

 

 

 

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

 

514

 

 

 

1,513

 

 

 

 

Acquisition of right of use assets - operating leases

 

15,085

 

 

 

34,763

 

 

 

71,054

 

Acquisition of lease liabilities - operating leases

 

15,085

 

 

 

34,430

 

 

 

71,054

 

Acquisition of right of use assets in exchange for lease liabilities - finance leases

 

279

 

 

 

 

 

 

 

Reconciliation of GAAP to Non-GAAP Financial Measures

 

 

 

 

 

 

 

Three Months Ended

 

Twelve Months Ended

 

 

December 31,

 

December 31,

 

 

 

2023

 

 

 

2022

 

 

 

2021

 

 

 

2023

 

 

 

2022

 

 

 

2021

 

 

(in thousands, except per share data)

 

 

Net (loss) income (GAAP)

$

(30,670

)

 

$

(27,207

)

 

$

(30,713

)

 

$

40,720

 

 

$

(149,186

)

 

$

(100,393

)

Income tax (benefit) expense

 

(842

)

 

 

(136

)

 

 

274

 

 

 

2,199

 

 

 

63

 

 

 

411

 

Loss (gain) on equity investments

 

109

 

 

 

 

 

 

 

 

 

(147,213

)

 

 

(11,825

)

 

 

(1,781

)

Change in fair value

 

8,408

 

 

 

1,493

 

 

 

(7,920

)

 

 

(53,461

)

 

 

18,084

 

 

 

11,359

 

Non-GAAP net loss

$

(22,995

)

 

$

(25,850

)

 

$

(38,359

)

 

$

(157,755

)

 

$

(142,864

)

 

$

(90,404

)

Net (loss) income per share attributable to Schr�dinger common and limited common stockholders, basic:

$

(0.32

)

 

$

(0.36

)

 

$

(0.54

)

 

$

0.57

 

 

$

(2.10

)

 

$

(1.42

)

Weighted average shares used to compute net (loss) income per share attributable to Schr�dinger common and limited common stockholders, basic:

 

72,062,761

 

 

 

71,270,563

 

 

 

70,930,410

 

 

 

71,776,301

 

 

 

71,173,419

 

 

 

70,594,950

 

Net (loss) income per share attributable to Schr�dinger common and limited common stockholders, diluted:

$

(0.32

)

 

$

(0.36

)

 

$

(0.54

)

 

$

0.54

 

 

$

(2.10

)

 

$

(1.42

)

Weighted average shares used to compute net (loss) income per share attributable to Schr�dinger common and limited common stockholders, diluted:

 

72,062,761

 

 

 

71,270,563

 

 

 

70,930,410

 

 

 

74,986,816

 

 

 

71,173,419

 

 

 

70,594,950

 

 

Matthew Luchini (Investors) Schr�dinger, Inc. matthew.luchini@schrodinger.com 917-719-0636

Allie Nicodermo (Media) Schr�dinger, Inc. allie.nicodermo@schrodinger.com 480-251-3144

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