Shares of computational platform healthcare services provider Schrodinger Inc. (NASDAQ:SDGR) are down in double digits today after investors were disappointed with its second quarter outing. Revenue dropped 8.6% year-over-year to $35.2 million, missing expectations by $3 million. EPS at $0.06 though came in ahead of expectations by $0.52.
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During the quarter, while software revenue stood at $29.4 million, Drug discovery revenue came in at $5.8 million. Further, the U.S. Food and Drug Administration has cleared Schrodinger’s IND application for SGR-2921 and the company now plans to commence a Phase 1 trial of the drug for the treatment of acute myeloid leukemia or myelodysplastic syndrome this year.
Looking ahead, for the full-year 2023, Schrodinger expects software revenue to rise in the range of 15% to 18%. It now expects drug discovery revenue to hover between $50 million and $70 million. This is a significant scaleback from the company’s prior expectations between $70 million and $90 million.
Overall, the Street has a $63.43 consensus price target on SDGR alongside a Strong Buy consensus rating. Today’s price erosion comes after a stellar 82% surge in Schrodinger shares over the past six months. Concurrently, short interest in the stock is now inching upward of 14.3%.
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