Evotec (NASDAQ:EVO) executives outlined a year of strategic repositioning and cost actions alongside a shifting revenue mix during the company’s fourth-quarter and full-year 2025 earnings call. Chief Executive Officer Christian Worchewski said 2025 marked “significant progress” as Evotec laid the groundwork for what he described as its “next chapter of sustainable and profitable growth,” despite a challenging market environment for early-stage drug discovery.
Worchewski said the company’s updated strategy centers on four midterm value-creation levers: scientific leadership, operational excellence, improved monetization of Just Evotec Biologics, and capturing pipeline value. He added that actions taken in 2025 resulted in more than EUR 60 million in annualized cost savings, a streamlined asset pipeline, and a reduction in capital expenditure of around 60%.
Horizon transformation targets EUR 75 million in run-rate savings
As part of Horizon, Evotec plans to streamline its footprint from 14 to 10 sites across 2026 and 2027, with planned closures in Abingdon, Munich, Lyon, and Framingham. Worchewski said the plan anticipates a reduction of approximately 800 positions across affected locations and enabling functions. The company is working through legal and regulatory processes, including workers’ council consultations, and said it expects workforce reductions to begin in the third quarter of 2026 and site closures to start in the fourth quarter, subject to local agreements.
Worchewski said Evotec is targeting structural run-rate savings of approximately EUR 75 million by the end of 2027, with 20% to 30% expected to materialize in 2026 and the majority in 2027. Asked about disruption risk, Worchewski said the company does not expect “material disruption” to ongoing customer and partner programs and noted it has been in “constant dialogue” with customers.
Discovery segment pressured by funding softness, but partnered pipeline advances
Worchewski said Evotec’s Discovery and Preclinical Development segment (DMPD) continued to see clinical progress across partnered programs, even as early-stage biotech funding remained soft. Over the past 12 to 18 months, he said two partnered assets advanced into Phase II studies, and a partnered preclinical asset moved into a first-in-human Phase I study. That brings Evotec’s partnered clinical portfolio to two Phase II programs and five Phase I programs, according to management. Worchewski added that Evotec expects the number of Phase II assets to grow from two to four during 2026.
Within Evotec’s oncology protein degradation collaboration with Bristol Myers Squibb (BMS), Worchewski said the first candidate moved from IND acceptance in November 2025 into a Phase I clinical study in March 2026 in advanced clear cell renal cell carcinoma. He said the IND acceptance and Phase I start triggered milestone payments of $5 million and $10 million, respectively. In neuroscience, Evotec said continued progress in a jointly developed preclinical pipeline with BMS triggered a $25 million milestone payment in October 2025. In kidney disease, Worchewski said a Phase II study in Alport syndrome under the Bayer partnership was initiated in December 2025.
In the Q&A, Evotec executives also discussed the evolving revenue profile of the BMS relationship. Worchewski said that from 2016 to the end of 2026, the two BMS collaborations in urology and oncology are expected to have generated close to EUR 800 million in cumulative revenues. He added that BMS-related revenues have declined by more than a third since their 2023 peak, reflecting a renewed investment phase focused on molecular glues. CFO Paul Hitchen said Evotec expects a “high single-digit% decline” in BMS revenues in 2026 versus 2025 and characterized 2026 as the trough year.
Regarding clinical plans for another Phase I asset referenced as EVT-8683, Chief Scientific Officer Kurt Dorman said Evotec could not comment on BMS’s exact plans but said management remains “excited about the program” and expects a thorough Phase I before a significant step such as Phase II in Alzheimer’s disease.
Just Evotec Biologics posts breakout year, anchored by Sandoz agreement
Worchewski described 2025 as a “breakthrough year” for Just Evotec Biologics (JAB), driven by a pivot away from a capacity-constrained manufacturing model toward what he called an “asset-lighter, technology-focused partner enablement model” centered on continuous manufacturing.
He highlighted the strategic agreement with Sandoz, which closed in December 2025. Worchewski said the agreement is valued at $650 million with additional royalty potential tied to 10 biosimilars. He also cited a BioMap Consortium award of up to $10 million from the U.S. Biomedical Advanced Research and Development Authority and an expanded collaboration with the Gates Foundation, including a new grant supporting 10 molecular design projects over three years using JAB’s AI- and computation-driven JMD platform.
In Q&A, Hitchen said non-Sandoz and non-Department of Defense (DoD) revenue is expected to be about 50% of the overall Just business by the end of 2026, up from approximately 25% in 2024 and about 30% in 2025. Management also discussed post-Toulouse impacts and longer-term revenue streams. Hitchen said the company expects a ramp-up of new products and licenses (including cell culture media, cell lines, and licenses) through 2028, reaching around 10% of Just revenue by 2028 and growing thereafter. He said royalties are expected to “kick in” beyond 2028 and are linked to loss-of-exclusivity dates for relevant drugs.
Financial results: Q4 revenue growth, full-year flat; EBITDA lifted by Just segment
Hitchen said Evotec’s results were in line with preliminary unaudited financial results shared on March 10, 2026. Group revenues in the fourth quarter of 2025 increased 14.5% to EUR 253.3 million, while full-year 2025 revenue decreased 1.1% to EUR 788.4 million. On a constant currency basis, he said Q4 revenues grew 21% and full-year revenues grew 1.7% versus 2024.
Performance diverged by segment. DMPD revenues fell 13.5% for the full year to EUR 528.9 million, which Hitchen attributed primarily to lower demand in early-stage drug discovery. Just Evotec revenues increased 39.8% year-over-year to EUR 259.4 million, driven in part by the Sandoz partnership and including an incremental contribution from a license payment of approximately EUR 65 million in the fourth quarter.
Adjusted group EBITDA increased to EUR 58 million in Q4 and EUR 41.1 million for the full year. Adjusted EBITDA in DMPD declined to EUR 6.8 million in Q4 and minus EUR 12 million for 2025, which Hitchen said reflected revenue contraction outpacing the cost base and creating internal overcapacity. Adjusted EBITDA in Just Evotec rose to EUR 53.2 million for 2025, which Hitchen attributed to validation of continuous manufacturing technology and a favorable shift in revenue mix toward higher margins.
Evotec ended 2025 with cash liquidity of EUR 476 million, which Hitchen characterized as a net cash position. He cited disciplined execution, monetization through Just Evotec Biologics, proceeds from maturing equity stakes including an upfront payment tied to selling Evotec’s minority stake in Dark Blue Therapeutics, and lower capital intensity, with CapEx spending down 38% year-over-year. Hitchen also noted Evotec entered 2026 with no active financial covenants.
2026 guidance calls for transition year, weaker first half and stronger second half
For 2026, Hitchen said Evotec views the year as a transition period as Horizon measures phase in. The company guided to group revenues of approximately EUR 700 million to EUR 780 million at incurred FX rates (EUR 730 million to EUR 810 million at constant FX) and adjusted group EBITDA of approximately EUR 0 to EUR 40 million at incurred FX (EUR 10 million to EUR 50 million at constant FX). Evotec expects foreign exchange to be a roughly 3.5% headwind to group revenues.
Hitchen said the first half of 2026 is expected to be weaker due to continued softness in early drug discovery and the non-recurrence of a $25 million Sandoz license that contributed to the first quarter of 2025. In the second half, he said Evotec expects strengthening driven by more strategic partnerships and a market recovery. For Just Evotec, management expects strong underlying growth but noted the non-repeat of the EUR 65 million Sandoz license payment recorded in Q4 2025; non-Sandoz and non-DoD activities are expected to grow about 40% in 2026. For DMPD, management expects soft standalone revenues in the first half with recovery to low single-digit growth in the second half, resulting in low- to mid-single-digit growth for the full year.
Beyond 2026, Hitchen reiterated Evotec’s midterm framework through 2030, including an expectation for group revenues to exceed EUR 1 billion by 2030 and an adjusted EBITDA margin reaching 20% by 2028 and exceeding that level by 2030, supported by Horizon cost savings and a shift to higher-margin revenue streams.
Separately, Worchewski provided a governance update, saying the Supervisory Board proposed Dieter Mainan for election as chairman at the June 11, 2026 annual general meeting, while thanking Professor Dr. Iris Loes Friedrich for her leadership as chairwoman.
About Evotec (NASDAQ:EVO)
Evotec SE (NASDAQ:EVO) is a global biotechnology company headquartered in Hamburg, Germany, specializing in drug discovery and development partnerships. The company leverages its integrated discovery platforms to support pharmaceutical and biotech clients in advancing novel therapies from target identification through preclinical development.
Evotec’s service offering encompasses high-throughput screening, bioanalytics, combinatorial chemistry, structural biology, pharmacology, and computational drug design.
