Today is shaping up negative for Recursion Pharmaceuticals, Inc. (NASDAQ:RXRX) shareholders, with the analysts delivering a substantial negative revision to this year's forecasts. Revenue estimates were cut sharply as analysts signalled a weaker outlook - perhaps a sign that investors should temper their expectations as well.

Following the latest downgrade, the current consensus, from the eight analysts covering Recursion Pharmaceuticals, is for revenues of US$53m in 2026, which would reflect a discernible 3.9% reduction in Recursion Pharmaceuticals' sales over the past 12 months. The loss per share is expected to ameliorate slightly, reducing to US$0.88. However, before this estimates update, the consensus had been expecting revenues of US$65m and US$0.87 per share in losses. So there's been quite a change-up of views after the recent consensus updates, with the analysts making a serious cut to their revenue forecasts while also making no real change to the loss per share numbers.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Recursion Pharmaceuticals' past performance and to peers in the same industry. We would highlight that sales are expected to reverse, with a forecast 7.7% annualised revenue decline to the end of 2026. That is a notable change from historical growth of 27% over the last five years. By contrast, our data suggests that other companies (with analyst coverage) in the same industry are forecast to see their revenue grow 23% annually for the foreseeable future. It's pretty clear that Recursion Pharmaceuticals' revenues are expected to perform substantially worse than the wider industry.

The Bottom Line

Unfortunately analysts also downgraded their revenue estimates, and industry data suggests that Recursion Pharmaceuticals' revenues are expected to grow slower than the wider market. Given the stark change in sentiment, we'd understand if investors became more cautious on Recursion Pharmaceuticals after today.

Still, the long-term prospects of the business are much more relevant than next year's earnings. We have estimates - from multiple Recursion Pharmaceuticals analysts - going out to 2028, and you can see them free on our platform here.

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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.