Schrodinger, Inc.SDGR

Schrodinger, Inc. Segments Disclosure

10-KFiled Feb 25, 20262 min read
Segment Reporting
The Company has determined that its chief executive officer ("CEO") is its chief operating decision maker ("CODM"). The Company’s CEO evaluates the financial performance of the Company based on two reportable segments: Software and Drug Discovery. The Software segment is focused on licensing the Company’s software to transform molecular discovery. The Drug Discovery segment is focused on building a portfolio of preclinical and clinical drug programs, internally and through collaborations.
The CODM reviews segment performance and allocates resources based upon segment revenue and segment gross profit of the Software and Drug Discovery reportable segments. Segment gross profit is derived by deducting cost of sales from U.S. GAAP revenue. Cost of sales are expenditures made that are directly attributable to the reportable segment. These expenditures are allocated to the segments based on headcount or by expenses directly incurred to support the Software or Drug Discovery segments. The reportable segment expenditures include compensation, supplies, and services from contract research organizations.
Certain cost items are not allocated to the Company’s reportable segments. These cost items primarily consist of non-drug discovery program related compensation and general operational expenses associated with the Company’s research and development, sales and marketing, and general and administrative activities. These costs are incurred by both segments and due to the integrated nature of the Company’s Software and Drug Discovery segments, any allocation methodology would be subjective and may not provide meaningful analysis.
Segment revenue is primarily earned in the United States and there are no intersegment revenues. Additionally, the Company reports assets on a consolidated basis and does not allocate assets to its reportable segments for purposes of assessing segment performance or allocating resources.
Presented below is financial information with respect to the Company’s reportable segments for the years presented:
Year Ended December 31,
202520242023
Segment revenues:
Software$199,500 $180,365 $159,124 
Drug discovery56,369 27,174 57,542 
Total segment revenues255,869 207,539 216,666 
Segment cost of revenues:
Software51,001 36,900 29,514 
Drug discovery62,254 38,556 46,460 
Total segment cost of revenues113,255 75,456 75,974 
Segment gross profit:
Software148,499 143,465 129,610 
Drug discovery(5,885)(11,382)11,082 
Total segment gross profit142,614 132,083 140,692 
Unallocated (expense) income:
Research and development(173,138)(201,785)(181,766)
Sales and marketing(40,963)(39,917)(37,226)
General and administrative(95,409)(99,677)(99,148)
Gain on equity investments— — 147,213 
Change in fair value of equity investments48,174 5,683 53,461 
Other income16,396 17,902 19,693 
Income tax expense(939)(1,412)(2,199)
Consolidated net (loss) income$(103,265)$(187,123)$40,720 
Revenues by geographic area are determined based on the address provided by the Company's customers and partners. The following table sets forth revenues by geographic area for the years ended December 31, 2025, 2024, and 2023:
Year Ended December 31,
202520242023
United States$152,963 $114,869 $161,961 
APAC26,181 25,802 24,569 
EMEA75,164 65,650 29,135 
Rest of World1,561 1,218 1,001 
$255,869 $207,539 $216,666 

Historical Timeline

Fiscal YearFiled
2025Feb 25, 2026Showing above
2024Feb 26, 2025
2023Feb 28, 2024
2022Feb 28, 2023
2021Feb 24, 2022
2020Mar 4, 2021

About Segments Disclosures

Segment disclosures break a company into its reportable operating units, revealing revenue, profit, and asset allocation that consolidated financial statements obscure. Under ASC 280, segments must match how the chief operating decision maker views the business, providing a window into internal management structure and resource allocation priorities.

Key signals: compare segment margins to identify which units drive profitability and which destroy value. Watch for changes in the number of reportable segments — segment aggregation or disaggregation often coincides with strategic shifts or attempts to obscure declining performance. Intersegment elimination patterns reveal internal pricing practices. The reconciliation between segment totals and consolidated figures exposes corporate overhead allocation and unallocated items. Geographic revenue concentration highlights regulatory and currency exposure. Compare segment-level capital expenditure against segment revenue to assess where management is investing for future growth versus harvesting existing assets.

Other Available Disclosures

Income TaxesRevenueFair ValuePP&ECommitmentsNew StandardsPay vs Performance