Earnings Update: Schrödinger, Inc. (NASDAQ:SDGR) Just Reported And Analysts Are Trimming Their Forecasts

It's been a pretty great week for Schrödinger, Inc. (NASDAQ:SDGR) shareholders, with its shares surging 11% to US$13.28 in the week since its latest first-quarter results. Revenues came in 23% better than analyst models expected, at US$59m, although statutory losses ballooned 29% to US$0.81, which is much worse than what was forecast. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.

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Taking into account the latest results, the current consensus, from the seven analysts covering Schrödinger, is for revenues of US$233.9m in 2026. This implies a definite 8.3% reduction in Schrödinger's revenue over the past 12 months. Losses are forecast to balloon 51% to US$2.09 per share. Yet prior to the latest earnings, the analysts had been forecasting revenues of US$252.7m and losses of US$1.84 per share in 2026. So it's pretty clear the analysts have mixed opinions on Schrödinger after this update; revenues were downgraded and per-share losses expected to increase.

See our latest analysis for Schrödinger

There was no major change to the consensus price target of US$21.13, signalling that the business is performing roughly in line with expectations, despite lower earnings per share forecasts. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. The most optimistic Schrödinger analyst has a price target of US$30.00 per share, while the most pessimistic values it at US$13.00. This is a fairly broad spread of estimates, suggesting that analysts are forecasting a wide range of possible outcomes for the business.

Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. We would highlight that revenue is expected to reverse, with a forecast 11% annualised decline to the end of 2026. That is a notable change from historical growth of 14% over the last five years. Compare this with our data, which suggests that other companies in the same industry are, in aggregate, expected to see their revenue grow 10% per year. It's pretty clear that Schrödinger's revenues are expected to perform substantially worse than the wider industry.

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The Bottom Line

The most important thing to note is the forecast of increased losses next year, suggesting all may not be well at Schrödinger. On the negative side, they also downgraded their revenue estimates, and forecasts imply they will perform worse than the wider industry. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.

With that in mind, we wouldn't be too quick to come to a conclusion on Schrödinger. Long-term earnings power is much more important than next year's profits. We have estimates - from multiple Schrödinger analysts - going out to 2028, and you can see them free on our platform here.

You should always think about risks though. Case in point, we've spotted 1 warning sign for Schrödinger you should be aware of.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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