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NEW YORK--(BUSINESS WIRE)--Nov 3, 2022--
Schrödinger, Inc. (Nasdaq: SDGR), whose physics-based computational platform is transforming the way therapeutics and materials are discovered, today announced financial results for the third quarter of 2022.
“We delivered a strong quarter, with third quarter software revenue in line with our expectations and strong drug discovery revenue, reflecting progress across our portfolio of collaborative and proprietary programs,” stated Ramy Farid, Ph.D., chief executive officer at Schrödinger. “As we progress through the remainder of the year, we are focused on continuing to drive software adoption and advancing our pipeline. Today we announced that we’ve initiated our Phase 1 study for our MALT1 program and we are looking forward to presenting new preclinical data from our CDC7 program at the upcoming ASH meeting. We are very positive about the long-term potential of our underlying business – this quarter’s results highlight the benefits of our balanced model encompassing software licensing, collaborations and proprietary programs.”
Third Quarter 2022 Financial Highlights
| Three Months Ended | ||||||||||
| September 30, | ||||||||||
|
| 2022 |
|
|
| 2021 |
|
| % Change | ||
| (in millions) |
| |||||||||
Total revenue | $ | 37.0 |
| $ | 29.9 |
| 24 | % | |||
Software revenue |
| 24.7 |
|
| 24.3 |
| 2 | % | |||
Drug discovery revenue |
| 12.3 |
|
| 5.6 |
| 121 | % | |||
|
|
|
| ||||||||
Gross profit | $ | 17.2 |
| $ | 11.1 |
| 55 | % | |||
Software gross margin |
| 72.2 | % |
| 72.8 | % |
| ||||
|
|
|
| ||||||||
Operating expenses | $ | 63.4 |
| $ | 45.8 |
| 38 | % | |||
Other income (expense) | $ | 6.5 |
| $ | (0.3 | ) |
| ||||
Net loss | $ | (39.9 | ) | $ | (35.0 | ) |
|
At September 30, 2022, Schrödinger had cash, cash equivalents, restricted cash and marketable securities of approximately $479 million, compared to approximately $513 million at June 30, 2022.
Recent Company Highlights
2022 Financial Outlook
As of November 3, 2022, Schrödinger outlined the following expectations for the fiscal year ending December 31, 2022:
“Despite the challenging macroeconomic and industry environment, our tightened total revenue guidance for 2022 remains within our original range,” stated Geoff Porges, MBBS, chief financial officer at Schrödinger. “We consider our balanced business model to be one of our greatest strengths, and this quarter’s results reflect the growing contribution of our drug discovery portfolio to our operating results and overall value.”
Webcast and Conference Call Information
Schrödinger will host a conference call to discuss its third quarter 2022 financial results on Thursday, November 3, 2022, at 4:30 p.m. ET. The live webcast can be accessed under “News & Events” 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.
About Schrödinger
Schrödinger is transforming the way therapeutics and materials are discovered. Schrödinger 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. Schrödinger’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, Schrödinger has approximately 800 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.
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, 2022 and fourth quarter ending December 31, 2022, 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 and SGR-2921, 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 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 the direct and indirect impacts of the ongoing COVID-19 pandemic on its business 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, 2022, filed with the Securities and Exchange Commission on November 3, 2022, 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, | |||||||||||||
|
| 2022 |
|
|
| 2021 |
|
|
| 2022 |
|
|
| 2021 |
| |
Revenues: |
|
|
|
|
|
|
| |||||||||
Software products and services | $ | 24,667 |
|
| $ | 24,280 |
|
| $ | 87,759 |
|
| $ | 74,672 |
| |
Drug discovery |
| 12,313 |
|
|
| 5,570 |
|
|
| 36,353 |
|
|
| 17,089 |
| |
Total revenues |
| 36,980 |
|
|
| 29,850 |
|
|
| 124,112 |
|
|
| 91,761 |
| |
Cost of revenues: |
|
|
|
|
|
|
| |||||||||
Software products and services |
| 6,866 |
|
|
| 6,611 |
|
|
| 21,478 |
|
|
| 18,158 |
| |
Drug discovery |
| 12,913 |
|
|
| 12,124 |
|
|
| 40,316 |
|
|
| 34,344 |
| |
Total cost of revenues |
| 19,779 |
|
|
| 18,735 |
|
|
| 61,794 |
|
|
| 52,502 |
| |
Gross profit |
| 17,201 |
|
|
| 11,115 |
|
|
| 62,318 |
|
|
| 39,259 |
| |
Operating expenses: |
|
|
|
|
|
|
| |||||||||
Research and development |
| 32,885 |
|
|
| 23,219 |
|
|
| 91,830 |
|
|
| 65,759 |
| |
Sales and marketing |
| 7,161 |
|
|
| 5,556 |
|
|
| 21,260 |
|
|
| 16,175 |
| |
General and administrative |
| 23,318 |
|
|
| 17,014 |
|
|
| 67,507 |
|
|
| 46,253 |
| |
Total operating expenses |
| 63,364 |
|
|
| 45,789 |
|
|
| 180,597 |
|
|
| 128,187 |
| |
Loss from operations |
| (46,163 | ) |
|
| (34,674 | ) |
|
| (118,279 | ) |
|
| (88,928 | ) | |
Other (expense) income: |
|
|
|
|
|
|
| |||||||||
(Loss) gain on equity investments |
| (3 | ) |
|
| — |
|
|
| 11,825 |
|
|
| (1,781 | ) | |
Change in fair value |
| 5,273 |
|
|
| (627 | ) |
|
| (16,591 | ) |
|
| 19,279 |
| |
Other income |
| 1,231 |
|
|
| 286 |
|
|
| 1,263 |
|
|
| 1,063 |
| |
Total other income (expense) |
| 6,501 |
|
|
| (341 | ) |
|
| (3,503 | ) |
|
| 18,561 |
| |
Loss before income taxes |
| (39,662 | ) |
|
| (35,015 | ) |
|
| (121,782 | ) |
|
| (70,367 | ) | |
Income tax expense (benefit) |
| 194 |
|
|
| (4 | ) |
|
| 199 |
|
|
| 137 |
| |
Net loss |
| (39,856 | ) |
|
| (35,011 | ) |
|
| (121,981 | ) |
|
| (70,504 | ) | |
Net loss attributable to noncontrolling interest |
| (3 | ) |
|
| (4 | ) |
|
| (2 | ) |
|
| (824 | ) | |
Net loss attributable to Schrödinger common and limited common stockholders | $ | (39,853 | ) |
| $ | (35,007 | ) |
| $ | (121,979 | ) |
| $ | (69,680 | ) | |
Net loss per share attributable to Schrödinger common and limited common stockholders, basic and diluted: | $ | (0.56 | ) |
| $ | (0.49 | ) |
| $ | (1.71 | ) |
| $ | (0.99 | ) | |
Weighted average shares used to compute net loss per share attributable to Schrödinger common and limited common stockholders, basic and diluted: |
| 71,207,992 |
|
|
| 70,784,184 |
|
|
| 71,140,682 |
|
|
| 70,481,901 |
|
Condensed Consolidated Balance Sheets (Unaudited) (in thousands, except for share and per share amounts) | ||||||||
Assets | September 30, 2022 |
| December 31, 2021 | |||||
Current assets: |
|
|
| |||||
Cash and cash equivalents | $ | 102,817 |
|
| $ | 120,267 |
| |
Restricted cash |
| 5,803 |
|
|
| 3,000 |
| |
Marketable securities |
| 370,739 |
|
|
| 456,212 |
| |
Accounts receivable, net of allowance for doubtful accounts of $124 and $108 |
| 23,583 |
|
|
| 31,744 |
| |
Unbilled and other receivables, net for allowance for unbilled receivables of $40 and $30 |
| 12,155 |
|
|
| 8,807 |
| |
Prepaid expenses |
| 9,104 |
|
|
| 5,030 |
| |
Total current assets |
| 524,201 |
|
|
| 625,060 |
| |
Property and equipment, net |
| 13,755 |
|
|
| 10,025 |
| |
Equity investments |
| 27,177 |
|
|
| 43,167 |
| |
Goodwill |
| 4,791 |
|
|
| — |
| |
Intangible assets, net |
| 720 |
|
|
| — |
| |
Right of use assets |
| 88,462 |
|
|
| 75,384 |
| |
Other assets |
| 2,879 |
|
|
| 2,851 |
| |
Total assets | $ | 661,985 |
|
| $ | 756,487 |
| |
Liabilities and Stockholders' Equity: |
|
|
| |||||
Current liabilities: |
|
|
| |||||
Accounts payable | $ | 10,918 |
|
| $ | 8,079 |
| |
Accrued payroll, taxes, and benefits |
| 18,904 |
|
|
| 18,405 |
| |
Deferred revenue |
| 43,920 |
|
|
| 55,368 |
| |
Lease liabilities |
| 8,683 |
|
|
| 2,042 |
| |
Other accrued liabilities |
| 6,396 |
|
|
| 7,317 |
| |
Total current liabilities |
| 88,821 |
|
|
| 91,211 |
| |
Deferred revenue, long-term |
| 21,977 |
|
|
| 30,064 |
| |
Lease liabilities, long-term |
| 87,165 |
|
|
| 77,827 |
| |
Other liabilities, long-term |
| 900 |
|
|
| 300 |
| |
Total liabilities |
| 198,863 |
|
|
| 199,402 |
| |
Commitments and contingencies (Note 6) |
|
|
| |||||
Stockholders' equity: |
|
|
| |||||
Preferred stock, $0.01 par value. Authorized 10,000,000 shares; zero shares issued and outstanding at September 30, 2022 and December 31, 2021, respectively |
| — |
|
|
| — |
| |
Common stock, $$0.01 par value. Authorized 500,000,000 shares; 62,067,768 and 61,834,515 shares issued and outstanding at September 30, 2022 and December 31, 2021, respectively |
| 620 |
|
|
| 618 |
| |
Limited common stock, $0.01 par value. Authorized 100,000,000 shares; 9,164,193 shares issued and outstanding at September 30, 2022 and December 31, 2021, respectively |
| 92 |
|
|
| 92 |
| |
Additional paid-in capital |
| 818,015 |
|
|
| 786,964 |
| |
Accumulated deficit |
| (351,931 | ) |
|
| (229,952 | ) | |
Accumulated other comprehensive loss |
| (3,686 | ) |
|
| (651 | ) | |
Total stockholders' equity of Schrödinger stockholders |
| 463,110 |
|
|
| 557,071 |
| |
Noncontrolling interest |
| 12 |
|
|
| 14 |
| |
Total stockholders' equity |
| 463,122 |
|
|
| 557,085 |
| |
Total liabilities and stockholders' equity | $ | 661,985 |
|
| $ | 756,487 |
|
Condensed Consolidated Statements of Cash Flows (Unaudited) (in thousands) | ||||||||
| Nine Months Ended September 30, | |||||||
|
| 2022 |
|
|
| 2021 |
| |
Cash flows from operating activities: |
|
|
| |||||
Net loss | $ | (121,981 | ) |
| $ | (70,504 | ) | |
Adjustments to reconcile net loss to net cash used in operating activities: |
|
|
| |||||
(Gain) loss on equity investments |
| (11,825 | ) |
|
| 1,781 |
| |
Noncash revenue from equity investments |
| — |
|
|
| (59 | ) | |
Fair value adjustments |
| 16,591 |
|
|
| (19,279 | ) | |
Depreciation and amortization |
| 3,202 |
|
|
| 2,195 |
| |
Stock-based compensation |
| 29,425 |
|
|
| 19,034 |
| |
Noncash research and development expenses |
| — |
|
|
| 811 |
| |
Noncash investment amortization |
| 2,102 |
|
|
| 4,736 |
| |
Loss on disposal of property and equipment |
| 14 |
|
|
| 140 |
| |
Decrease (increase) in assets, net of acquisition: |
|
|
| |||||
Accounts receivable, net |
| 8,673 |
|
|
| 20,071 |
| |
Unbilled and other receivables |
| (3,272 | ) |
|
| (1,358 | ) | |
Reduction in the carrying amount of right of use assets |
| 4,812 |
|
|
| 4,724 |
| |
Prepaid expenses and other assets |
| (6,837 | ) |
|
| (2,720 | ) | |
Increase (decrease) in liabilities, net of acquisition: |
|
|
| |||||
Accounts payable |
| 2,597 |
|
|
| (229 | ) | |
Accrued payroll, taxes, and benefits |
| 499 |
|
|
| 2,010 |
| |
Deferred revenue |
| (19,535 | ) |
|
| (10,190 | ) | |
Lease liabilities |
| 920 |
|
|
| (3,705 | ) | |
Other accrued liabilities |
| (126 | ) |
|
| 1,611 |
| |
Net cash used in operating activities |
| (94,741 | ) |
|
| (50,931 | ) | |
Cash flows from investing activities: |
|
|
| |||||
Purchases of property and equipment |
| (6,668 | ) |
|
| (6,210 | ) | |
Purchases of equity investments |
| (600 | ) |
|
| (3,700 | ) | |
Distribution from equity investment |
| 11,825 |
|
|
| 375 |
| |
Proceeds from sale of equity investments |
| — |
|
|
| 15,735 |
| |
Acquisition, net of acquired cash |
| (6,427 | ) |
|
| — |
| |
Purchases of marketable securities |
| (203,375 | ) |
|
| (340,509 | ) | |
Proceeds from maturity of marketable securities |
| 283,711 |
|
|
| 339,588 |
| |
Net cash provided by investing activities |
| 78,466 |
|
|
| 5,279 |
| |
Cash flows from financing activities: |
|
|
| |||||
Issuances of common stock upon stock option exercises |
| 1,628 |
|
|
| 6,710 |
| |
Contribution by noncontrolling interest |
| — |
|
|
| 25 |
| |
Net cash provided by financing activities |
| 1,628 |
|
|
| 6,735 |
| |
Net decrease in cash and cash equivalents and restricted cash |
| (14,647 | ) |
|
| (38,917 | ) | |
Cash and cash equivalents and restricted cash, beginning of period |
| 123,267 |
|
|
| 202,796 |
| |
Cash and cash equivalents and restricted cash, end of period | $ | 108,620 |
|
| $ | 163,879 |
| |
|
|
|
| |||||
Supplemental disclosure of cash flow and noncash information |
|
|
| |||||
Cash paid for income taxes | $ | 462 |
|
| $ | 236 |
| |
Supplemental disclosure of non-cash investing and financing activities |
|
|
| |||||
Purchases of property and equipment in accounts payable |
| 198 |
|
|
| 59 |
| |
Purchases of property and equipment in accrued liabilities |
| 109 |
|
|
| — |
| |
Acquisition of right to use assets, contingency resolution |
| 1,513 |
|
|
| — |
| |
Acquisition of right of use assets |
| 14,767 |
|
|
| 71,054 |
| |
Acquisition of lease liabilities |
| 14,767 |
|
|
| 71,054 |
|
View source version on businesswire.com:https://www.businesswire.com/news/home/20221103005992/en/
CONTACT: Jaren Irene Madden (Investors)
Schrödinger, Inc.
jaren.madden@schrodinger.com
617-286-6264Tracy Lessor (Media)
Schrödinger, Inc.
tracy.lessor@schrodinger.com
617-519-9827
KEYWORD: NEW YORK UNITED STATES NORTH AMERICA
INDUSTRY KEYWORD: HEALTH TECHNOLOGY HEALTH TECHNOLOGY SOFTWARE PHARMACEUTICAL BIOTECHNOLOGY
SOURCE: Schrödinger, Inc.
Copyright Business Wire 2022.
PUB: 11/03/2022 04:00 PM/DISC: 11/03/2022 04:02 PM
http://www.businesswire.com/news/home/20221103005992/en