Q4 2024 Schrodinger Inc Earnings Call Transcript
Key Points
- Schrodinger Inc (SDGR) exceeded software revenue expectations in 2024, with a total software revenue of $180 million, representing a growth of over 13%.
- The company established a new drug discovery collaboration and expanded a software agreement with Novartis, enhancing its collaborative and proprietary pipeline.
- Schrodinger Inc (SDGR) achieved a 100% software customer retention rate for customers with an annual contract value (ACV) of at least $500,000.
- The company reported a significant increase in the number of software customers with an ACV greater than $5 million, doubling from 4 to 8.
- Schrodinger Inc (SDGR) is well-positioned for 2025 with plans to release several new products and solutions, including predictive toxicology technology and enhancements to biologics discovery technologies.
- Total revenue for 2024 decreased to $208 million from $217 million in 2023, primarily due to a reduction in drug discovery revenue.
- The overall gross margin declined from 77.6% in Q4 2023 to 72.6% in Q4 2024, driven by higher drug discovery expenses and increased software costs.
- The company reported a net loss of $187 million for 2024, compared to a net income of $41 million in 2023, largely due to the absence of gains from previous years.
- Operating expenses increased by 7.3% compared to 2023, with significant increases in R&D and sales and marketing expenses.
- Schrodinger Inc (SDGR) anticipates continued churn in its small and mid-cap customer segments, partly due to acquisitions of biotech software customers.
Thank you for standing by. Welcome to Schrödinger's conference call to review fourth-quarter and full-year 2024 financial results. My name is Kelvin, and I'll be your operator for today's call. (Operator Instructions) Please be advised that today's call is being recorded at the company's request.
Now, I would like to introduce your host for today's conference, Ms. Jaren Madden, Senior Vice President of Investor Relations and Corporate Affairs. Please go ahead.
Thank you, and good afternoon, everyone. Welcome to today's call during which we will provide an update on the company and review our fourth-quarter and full-year 2024 financial results. Earlier today, we issued a press release summarizing our financial results and progress across the company, which is available on our website at schrodinger.com. Here with me on our call today are Ramy Farid, Chief Executive Officer; Geoff Porges, Chief Financial Officer; and Karen Akinsanya, President of R&D
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