Evotec SE (EVO): ANSOFF MATRIX [Dec-2025 Updated]

Honestly, navigating Evotec SE through a soft Discovery & Preclinical Development market while executing a pivot to a more profitable, asset-lighter model is the main event right now, especially with that 2025 revenue target of € 760 - 800 million staring us down. As an analyst who's seen a few market cycles, I see this isn't about one silver bullet; it's about disciplined execution across four distinct growth levers-from deepening those key Pharma alliances and aggressively expanding the JEB customer base, to finally monetizing premium assets like the E.MPD and strategically out-licensing that large co-owned pipeline. You need to see the concrete steps mapped out below to understand exactly how Evotec SE plans to hit that number.

Evotec SE (EVO) - Ansoff Matrix: Market Penetration

You're looking at how Evotec SE can grow by selling more of what it already offers into its current customer base. This is about digging deeper with the clients you already have, which is generally the lowest-risk path for expansion.

Deepen strategic alliances with existing Top 20 Pharma partners.

Evotec SE works with all Top 20 Pharma companies, which shows deep market penetration already exists. The strategy here is to expand the scope and value derived from these established relationships. For instance, the strategic protein degradation collaboration with Bristol Myers Squibb (BMS) was highly productive in H1 2025, resulting in performance- and program-based payments amounting to US$ 75 million. Also, a key advancement in the neuroscience collaboration with BMS triggered a research payment of US$ 20 million in the second quarter of 2025. Furthermore, progress in the strategic preclinical neuroscience partnership resulted in an additional payment of US$ 25 million after the 9M period to support joint programs. Evotec SE also maintains partnerships with other major players like Pfizer and Eli Lilly and Company ("Lilly").

Cross-sell Just - Evotec Biologics (JEB) services to current D&PD clients.

This involves leveraging the success of Just - Evotec Biologics (JEB) across the existing Discovery & Preclinical Development (D&PD) client base. JEB is showing strong momentum, with revenues increasing by 16% in H1 2025, reaching in excess of € 100 million for the first half of the year, or € 102.2 million specifically for H1 2025. The focus is on accelerating growth in the non-Sandoz / non-DoD business segments. The recent landmark transaction with Sandoz, while involving a sale of the EU site, still positions Evotec SE to benefit from royalties on a portfolio of up to ten biosimilars, with the upfront cash component being approximately US$ 350 million plus additional license fees and milestones totaling more than US$ 300 million in the coming years.

Increase utilization of existing capacity via more integrated, risk-sharing deals.

While specific utilization rates aren't public, the strategic shift supports this goal. Evotec SE is pivoting its JEB segment toward an asset-lighter model, which implies a focus on high-value, technology-driven service contracts rather than capital-intensive manufacturing ownership. This is designed to better scale and leverage its technology and intellectual property (IP). The company is moving toward flexible partnering models, which naturally includes more integrated, risk-sharing structures to secure longer-term capacity commitments from partners.

Target a higher share of the € 4.65 billion 2025 lead optimization market.

The global lead optimization services in drug discovery market size is calculated at US$ 4.65 billion in 2025. Evotec SE is a named key player in this market. The goal is to increase the share of this market, which is projected to grow to US$ 10.26 billion by 2034. The medicinal chemistry services segment within this market held an approximate 40% share in 2024.

Here's a look at the market context and Evotec SE's 2025 financial targets that underpin this strategy:

Drive operational excellence to capture € 40 million in annual savings.

Operational excellence is being driven through the Priority Reset initiative. This program is on track to deliver annualised recurring gross savings of € 40 million. This cost discipline is a key factor supporting the confirmed 2025 Adjusted EBITDA guidance range of € 30 - 50 million, which is an improvement over the 2024 Adjusted Group EBITDA of € 22.6 million. The cost savings generated through these transformation efforts are now expected to exceed initial targets announced during the Q1 2025 call. You're seeing a clear focus on margin improvement.

• Work with all Top 20 Pharma companies.
• JEB revenue growth of 16% in H1 2025.
• BMS partnership payments of US$ 75 million in H1 2025.
• Targeted annual savings of € 40 million.
• 2025 Adjusted EBITDA target range: € 30 - 50 million.

Evotec SE (EVO) - Ansoff Matrix: Market Development

You're looking at how Evotec SE (EVO) plans to drive growth by taking its existing capabilities into new markets, which is the essence of Market Development in the Ansoff Matrix. The pressure on the core Drug Discovery & Preclinical Development (D&PD) business makes this expansion critical right now.

The immediate focus is on stabilizing the D&PD segment, which saw revenues drop by 11.0% to € 269.0 m in the first half of 2025 compared to the prior year period's € 302.4 m. The company anticipates a market recovery for D&PD as early as 2026, but for now, new customer acquisition is key to offsetting this softness.

For Just - Evotec Biologics (JEB), the strategy is clearly about aggressively expanding the customer base beyond the established large partners. JEB revenues actually grew by 16% to € 102.2 m in H1 2025. This growth was explicitly propelled by strong performance with non-Sandoz / non-DoD customers. This trend continued into the nine-month mark, with JEB revenue growth at 11.3% for 9M 2025. This demonstrates that the market for their technology, separate from the major existing contracts, is robust.

The Market Development thrust involves several concrete actions:

• Aggressively expand non-Sandoz / non-DoD customer base for JEB.
• Target mid-cap biotech companies in the US, a key growth market.
• License J.POD continuous manufacturing technology to new global partners.
• Establish commercial presence in new Asian biotech hubs, leveraging grants.
• Focus on new customers to stabilize D&PD revenue, which fell 11% in H1 2025.

The licensing of the J.POD continuous manufacturing technology is being monetized through new global partnerships. The recent landmark transaction with Sandoz, signed on November 4, 2025, is a prime example, securing approximately US$ 350 m in cash for the Toulouse site plus an indefinite technology license. The overall potential from this deal, including future milestones and royalties on up to 10 biosimilar molecules, exceeds US$ 650 m. This move shifts JEB toward a more capital-efficient, asset-lighter model, which better enables technology and Intellectual Property (IP) licensing to a broader set of partners.

Geographically, Evotec SE maintains a global team of over 4,800 experts operating from sites in Europe and the U.S.. The growth in JEB revenues was partly driven by increased business in the US, alongside the ramp-up in France. Furthermore, the company is actively seeking non-traditional funding and partnerships, evidenced by receiving a grant from The Gates Foundation to support tuberculosis treatment development.

Here's a quick look at the segment performance underpinning this strategy:

The shift in revenue mix is expected to improve margins, as the full-year 2025 revenue guidance was adjusted down to a range of € 760 - 800 m from the previously guided € 840 - 880 m. Still, the Adjusted Group EBITDA guidance remains firm at € 30 - 50 m, which suggests the higher-margin technology licensing and cost discipline are working to protect profitability despite the top-line softness in D&PD.

Finance: draft 2026 budget assumptions for D&PD new customer acquisition targets by end of Q1 2026.

Evotec SE (EVO) - Ansoff Matrix: Product Development

You're looking at how Evotec SE builds out its service and technology portfolio, which is Product Development in Ansoff terms. It's about taking what you have and making it better or new, so you can charge more or serve more clients.

For 2025, the focus on R&D spend is tight but targeted. Evotec SE expects its R&D expenditures for the full year 2025 to be in a range of € 40 - 50 million, down from € 50.9 million in 2024. This spend is specifically aimed at high-value platform enhancements, which is smart capital allocation in a soft market.

Here's a quick look at that planned spend versus the prior year:

Monetizing the Molecular Patient Database (E.MPD) as a premium service is a key area. While the exact 2025 premium service revenue isn't public, the platform itself is a cornerstone of their data-driven R&D, which they use with all Top 20 Pharma companies and over 800 biotechs. The scale of the E.MPD, which is being expanded, for instance, through the NURTuRE-AKI consortium, currently includes:

• 15,000 Patients
• 200,000 Samples
• 200 bn. Data Points

Integrating AI/ML-driven drug design into all Discovery & Preclinical Development (D&PD) offerings helps accelerate the customer journey and increase success rates. Evotec SE's expertise already spans proprietary platforms that support this, like PanOmics and PanHunter, which are essential for generating the E.MPD data.

Introducing iPSC-based disease modeling for existing neurology and oncology clients builds on their existing capabilities. Evotec SE has an industry-leading end-to-end platform for off-the-shelf iPSC-based cell therapeutics. They are actively progressing targets identified through deep understanding of human diseases, which is the entry point for precision medicine.

Developing new service offerings around next-generation cell therapies is a major push. The iPSC platform is designed to be truly scalable, aiming to serve the market with up to tens of thousands of doses. Their internal iPSC-based product candidate pipeline is broad, covering:

• Immunotherapies for cancer and autoimmune diseases
• Regenerative therapies targeting diabetes and heart failure

The focus on R&D spend of € 40 - 50 million for 2025 is definitely about driving these platform enhancements forward. Finance: draft the Q3 2025 budget reallocation memo by next Tuesday.

Evotec SE (EVO) - Ansoff Matrix: Diversification

You're looking at how Evotec SE is moving beyond its core service business into new revenue streams, which is classic diversification on the Ansoff Matrix. This is about monetizing existing capabilities in new ways, which is a smart move when the core market, like early drug discovery services, sees soft demand.

The shift is clear in the 9M 2025 results, where Group revenues were € 535.1 million, down (7.1)% year-over-year, with the Discovery & Preclinical Development segment (D&PD) declining by (12.3)% to € 392.1 million. This context makes the diversification efforts, especially those generating upfront cash, critical for hitting the confirmed full-year 2025 revenue guidance of € 760 - 800 million.

Out-license Co-owned Pipeline Assets

Evotec SE is actively managing its portfolio of proprietary and co-owned assets as a diversification play, moving toward an asset-lighter model. As of January 2025, the company stated it had established a portfolio of more than 200 proprietary and co-owned R&D projects spanning from early discovery to clinical development. This strategy is supported by strong scientific advancements, with expectations of up to four molecules entering clinical phase II within the next six to nine months (as of November 2025).

The focus on technology licensing, exemplified by the Sandoz deal, helps crystallize value from these assets without the full capital commitment of in-house development.

Establish a New Business Line for Diagnostic Tools from E.MPD Data

Evotec SE is systematically expanding its platform technologies, which includes its Molecular Patient Database (MPD). While specific revenue figures for a dedicated diagnostic tools business line are not public, the expansion of this data platform supports the overall strategy to leverage technology and science leadership. This platform is part of the company's move to establish an integrated disease understanding and precision medicine platform.

Secure New Government/NGO Funding for Infectious Disease Programs

Securing non-dilutive funding from governmental and non-governmental organizations diversifies funding sources away from pure service revenue. In 2025, Evotec received a US$ 2.5 million grant from The Gates Foundation (GF) in May to support next-generation tuberculosis treatments. Furthermore, in January 2025, the company, along with partners, secured a US$ 4.5 million grant from the Korea Institute of Advanced Technology (KIAT) for lung disease therapies. This builds on prior support, such as the $23.8 million grant from the Bill & Melinda Gates Foundation announced in 2019 for tuberculosis research.

Monetize the Biosimilar Portfolio via Royalty Streams in New Geographic Markets

The monetization of the biosimilar portfolio is being realized through technology licensing deals, which include royalty streams. The Sandoz transaction is the prime example of this diversification into future royalty income streams.

Pursue New Technology Licensing Deals, like the Sandoz Transaction, for Future Growth

The transaction with Sandoz AG, signed in November 2025, is a major step in transitioning Just - Evotec Biologics (JEB) to a more asset-lighter model. The financial structure of this deal provides immediate cash and future revenue diversification.

Here's the quick math on the Sandoz deal, which is expected to be immediately earnings accretive:

This deal is key, as JEB revenues were € 143.4 million in 9M 2025, showing +11.3% growth, driven by non-Sandoz/non-DoD business. The confirmed 2025 Adjusted Group EBITDA guidance is € 30 - 50 million.

Evotec SE has also engaged in other technology licensing, including a new multi-year master research collaboration with Pfizer, initially focused on early discovery research for metabolic and infectious diseases, and a new technology development partnership with Novo Nordisk for next-generation cell therapies. Furthermore, a strategic preclinical neuroscience partnership with BMS resulted in a US$ 25 million payment after the period end.

The company is driving operational leverage through cost-out initiatives expected to result in total cost reductions of more than € 60 million in 2025.

• Pipeline assets targeted for 2025 end: Over 170.
• Progressed pipeline assets: Expecting up to four in clinical phase II.
• KIAT Grant (Jan 2025): US$ 4.5 million.
• Gates Foundation Grant (May 2025): US$ 2.5 million.