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Simulations Plus, Inc. (SLP - Free Report) reported first-quarter fiscal 2026 adjusted earnings of 13 cents per share, lagging the Zacks Consensus Estimate by 27.8%. The bottom line also compared unfavorably with the prior-year quarter’s 17 cents.
Quarterly revenues declined 3% year over year to $18.4 million, reflecting lower software revenue amid strong momentum in services. The top line beat the consensus mark by 2%. Management noted that software softness was expected due to reduced clinical operations and development activity, partially offset by increased demand for discovery-focused solutions. On the other hand, services growth was fueled by strong traction in commercialization offerings and steady gains in development projects.
Strong bookings, annual software price increases and improving funding conditions for biopharma clients underpin management’s confidence in the remainder of fiscal 2026. Favorable market dynamics, such as most-favored nation pricing agreements and a healthier client funding environment, are expected to support spending levels. Management also sees potential upside if customer budgets recover more quickly than anticipated.
In response to weak revenue and earnings performance, SLP’s shares tanked 5% in trading and closed the session at $18.05 on Jan. 8, 2026.
SLP’s Quarter in Details
Fiscal first-quarter revenues from Software (48% of total quarterly revenues) plunged 17% year over year to $8.9 million. During the quarter, software revenue and renewal rates remained under pressure due to challenging market conditions and ongoing client consolidation. Software revenue was led by Development products, mainly GastroPlus and MonolixSuite, which contributed 81%, while Discovery products, primarily ADMET Predictor, accounted for 15%, and Clinical Ops products, led by Proficiency, made up the remaining 4%.
SLP ended the quarter with 302 commercial clients, generating average revenue of $97,000 per client and an 88% renewal rate.
Simulations Plus, Inc. Price, Consensus and EPS Surprise
Services’ revenues (52%) improved 16% to $9.5 million, driven mainly by strong performance in the MedCom business. For the quarter, development services (biosimulation) made up 71% of services revenues, while commercialization services (Med Comm) accounted for 29%. The company worked on 186 services projects during the quarter, with the ending backlog rising 18% to $20.4 million, reflecting a healthy and active services pipeline.
SLP’s Operating Details
The gross margin in the quarter under review was 59% compared with 54% in the prior-year quarter.
The Software segment’s gross margin was 84% compared with 75% in the prior-year quarter. Services’ gross margin was 36%, up from 26%. The improvement in software gross margin was mainly driven by lower clinical operations revenue, while the higher services gross margin reflected the impact of last year’s workforce reduction and the reorganization of services staff to better support product development.
Adjusted EBITDA declined to $3.5 million from $4.5 million in the prior-year quarter.
Adjusted EBITDA margin was 19% compared with 24% in the previous-year quarter.
SLP’s Balance Sheet
As of Nov. 30, 2025, cash and short-term investments were $35.7 million compared with $32.4 million as of Aug. 31, 2025.
SLP has no debt as of the end of the fiscal first quarter.
SLP Fiscal 2026 Guidance Reaffirmed
Simulations Plus expects revenues to be between $79 million and $82 million. This indicates an increase of 0-4% from fiscal 2025 revenues.
The company expects the Software segment mix to be 57-62% of total revenues.
SLP estimates adjusted earnings per share to be between $1.03 and $1.10 and adjusted EBITDA margin between 26% and 30%.
BlackBerry Limited (BB - Free Report) reported third-quarter fiscal 2026 non-GAAP earnings per share (EPS) of 5 cents. In the year-ago quarter, it reported non-GAAP EPS of 2 cents. The Zacks Consensus Estimate was pegged at 4 cents per share. BlackBerry reported quarterly revenue of $141.8 million, beating the top end of its guidance ($132-$140 million). The top line, however, dipped 1.3% year over year owing to soft sales across Secure Communications and Licensing arms. The consensus estimate was pinned at $139 million.
Guidewire Software, Inc. (GWRE - Free Report) reported non-GAAP earnings per share of 66 cents for first-quarter fiscal 2026 (ended Oct. 31, 2025), up 53.5% year over year and in line with the Zacks Consensus Estimate. The company reported revenues of $332.6 million, up 26.5% year over year. Revenues beat the Zacks Consensus Estimate by 4.9%. The figure also surpassed the company’s guided range of $315-$321 million. This uptick was driven by solid momentum across all business segments.
Ciena Corporation (CIEN - Free Report) reported fourth-quarter fiscal 2025 (ended Nov. 1) results, wherein adjusted EPS of 91 cents beat the Zacks Consensus Estimate of 77 cents. Also, the bottom line expanded 68.5% year over year, driven by improvements in the operating model. Quarterly revenues rose 20.3% year over year to $1.35 billion, surpassing the Zacks Consensus Estimate of $1.3 billion.
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SLP Stock Crashes on Q1 Earnings Miss, Software Headwinds Hurt Sales
Key Takeaways
Simulations Plus, Inc. (SLP - Free Report) reported first-quarter fiscal 2026 adjusted earnings of 13 cents per share, lagging the Zacks Consensus Estimate by 27.8%. The bottom line also compared unfavorably with the prior-year quarter’s 17 cents.
Quarterly revenues declined 3% year over year to $18.4 million, reflecting lower software revenue amid strong momentum in services. The top line beat the consensus mark by 2%. Management noted that software softness was expected due to reduced clinical operations and development activity, partially offset by increased demand for discovery-focused solutions. On the other hand, services growth was fueled by strong traction in commercialization offerings and steady gains in development projects.
Strong bookings, annual software price increases and improving funding conditions for biopharma clients underpin management’s confidence in the remainder of fiscal 2026. Favorable market dynamics, such as most-favored nation pricing agreements and a healthier client funding environment, are expected to support spending levels. Management also sees potential upside if customer budgets recover more quickly than anticipated.
In response to weak revenue and earnings performance, SLP’s shares tanked 5% in trading and closed the session at $18.05 on Jan. 8, 2026.
SLP’s Quarter in Details
Fiscal first-quarter revenues from Software (48% of total quarterly revenues) plunged 17% year over year to $8.9 million. During the quarter, software revenue and renewal rates remained under pressure due to challenging market conditions and ongoing client consolidation. Software revenue was led by Development products, mainly GastroPlus and MonolixSuite, which contributed 81%, while Discovery products, primarily ADMET Predictor, accounted for 15%, and Clinical Ops products, led by Proficiency, made up the remaining 4%.
SLP ended the quarter with 302 commercial clients, generating average revenue of $97,000 per client and an 88% renewal rate.
Simulations Plus, Inc. Price, Consensus and EPS Surprise
Simulations Plus, Inc. price-consensus-eps-surprise-chart | Simulations Plus, Inc. Quote
Services’ revenues (52%) improved 16% to $9.5 million, driven mainly by strong performance in the MedCom business. For the quarter, development services (biosimulation) made up 71% of services revenues, while commercialization services (Med Comm) accounted for 29%. The company worked on 186 services projects during the quarter, with the ending backlog rising 18% to $20.4 million, reflecting a healthy and active services pipeline.
SLP’s Operating Details
The gross margin in the quarter under review was 59% compared with 54% in the prior-year quarter.
The Software segment’s gross margin was 84% compared with 75% in the prior-year quarter. Services’ gross margin was 36%, up from 26%. The improvement in software gross margin was mainly driven by lower clinical operations revenue, while the higher services gross margin reflected the impact of last year’s workforce reduction and the reorganization of services staff to better support product development.
Adjusted EBITDA declined to $3.5 million from $4.5 million in the prior-year quarter.
Adjusted EBITDA margin was 19% compared with 24% in the previous-year quarter.
SLP’s Balance Sheet
As of Nov. 30, 2025, cash and short-term investments were $35.7 million compared with $32.4 million as of Aug. 31, 2025.
SLP has no debt as of the end of the fiscal first quarter.
SLP Fiscal 2026 Guidance Reaffirmed
Simulations Plus expects revenues to be between $79 million and $82 million. This indicates an increase of 0-4% from fiscal 2025 revenues.
The company expects the Software segment mix to be 57-62% of total revenues.
SLP estimates adjusted earnings per share to be between $1.03 and $1.10 and adjusted EBITDA margin between 26% and 30%.
SLP’s Zacks Rank
Currently, Simulations Plus sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Recent Performance of Other Companies
BlackBerry Limited (BB - Free Report) reported third-quarter fiscal 2026 non-GAAP earnings per share (EPS) of 5 cents. In the year-ago quarter, it reported non-GAAP EPS of 2 cents. The Zacks Consensus Estimate was pegged at 4 cents per share. BlackBerry reported quarterly revenue of $141.8 million, beating the top end of its guidance ($132-$140 million). The top line, however, dipped 1.3% year over year owing to soft sales across Secure Communications and Licensing arms. The consensus estimate was pinned at $139 million.
Guidewire Software, Inc. (GWRE - Free Report) reported non-GAAP earnings per share of 66 cents for first-quarter fiscal 2026 (ended Oct. 31, 2025), up 53.5% year over year and in line with the Zacks Consensus Estimate. The company reported revenues of $332.6 million, up 26.5% year over year. Revenues beat the Zacks Consensus Estimate by 4.9%. The figure also surpassed the company’s guided range of $315-$321 million. This uptick was driven by solid momentum across all business segments.
Ciena Corporation (CIEN - Free Report) reported fourth-quarter fiscal 2025 (ended Nov. 1) results, wherein adjusted EPS of 91 cents beat the Zacks Consensus Estimate of 77 cents. Also, the bottom line expanded 68.5% year over year, driven by improvements in the operating model. Quarterly revenues rose 20.3% year over year to $1.35 billion, surpassing the Zacks Consensus Estimate of $1.3 billion.