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HAMBURG - Evotec SE (NASDAQ:EVO) reported a 7.1% decline in nine-month revenues to €535.1 million, as continued softness in early drug discovery services overshadowed growth in its biologics segment.
The company’s Discovery & Preclinical Development segment saw a 12.3% revenue drop, while its Just - Evotec Biologics unit grew 11.3%.
Evotec shares fell 9.32% in pre-market trading following the results.
The company’s adjusted EBITDA was negative at €16.9 million for the period, compared to negative €6.0 million in the same period last year, primarily due to underutilization and high fixed costs in its discovery segment.
"Evotec remains firmly on track in delivering against its strategic objectives, demonstrating strong execution for future sustainable and profitable growth," said Dr. Christian Wojczewski, CEO of Evotec. "Despite a continued softness in the early drug discovery market, we are seeing first signals of improvement in our base business."
The company highlighted a landmark transaction with Sandoz signed after the reporting period, potentially worth over $650 million plus royalties. Under the agreement, Sandoz will acquire Evotec’s biologics facility in Toulouse and license its continuous manufacturing platform technology.
Evotec confirmed its 2025 guidance, expecting full-year revenues between €760-800 million and adjusted EBITDA of €30-50 million. The company also reported progress in strategic partnerships, including performance-based payments from Bristol Myers Squibb totaling $95 million year-to-date.
Cost reduction initiatives are ahead of plan, with expected savings of more than €60 million in 2025, double the initial target. Looking further ahead, Evotec maintains its 2028 outlook for 8-12% revenue CAGR and an adjusted EBITDA margin above 20%.
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