Evotec SE (EVO): BCG Matrix [Dec-2025 Updated]

You're looking for a clear-eyed view of Evotec SE's business segments, and the BCG Matrix is defintely the right tool to map their current strategic position and capital allocation priorities. What we see is a company aggressively pivoting: Just - Evotec Biologics (JEB) is a clear Star, fueled by 105% growth in its non-Sandoz business, while the core Discovery & Preclinical Development (D&PD) segment, bringing in €392.1 million, is being managed strictly as a Cash Cow needing efficiency after that €(9.3) million H1 adjusted EBITDA miss. Management is also clearing out the Dogs-shedding assets like the €70 million Recursion stake-to fund high-potential Question Marks, most notably the $650 million Sandoz deal and the 100+ asset pipeline that requires that €40 - €50 million R&D spend. Dive in to see the hard numbers behind this strategic shift.

Background of Evotec SE (EVO)

You're looking at Evotec SE as of late 2025, and honestly, the story right now is one of strategic pivot amid a tough market. Evotec SE, a life science company focused on pioneering drug discovery and development, has a global team of over 4,800 experts operating across Europe and the U.S.. They're using proprietary platforms like Molecular Patient Databases and PanOmics to speed up the journey from concept to cure for their partners, which include all Top 20 Pharma companies.

Looking at the numbers through the first nine months of 2025, the group's revenues came in at € 535.1 m, which is a decrease of 7.1% compared to the same period in 2024. This reflects the ongoing strategic execution under CEO Dr. Christian Wojczewski, which involves sharpening the focus on high-value segments.

The business is clearly split into two main areas, and their performance tells a tale of two different markets. The Discovery & Preclinical Development segment, which they recently renamed from Shared R&D, saw its revenues drop by 12.3% to € 392.1 m for the 9M 2025 period. This segment continues to deal with what Evotec calls a soft demand in the early drug discovery service market.

On the other hand, Just - Evotec Biologics (JEB) is showing real momentum, with revenues climbing 11.3% to € 143.4 m in the first nine months of 2025. That growth is being fueled by a massive 105% year-over-year increase in its non-Sandoz / non-Department of Defense business activities.

You should note some big recent moves that reshape the future. Just after the 9M reporting period, on November 4, 2025, Evotec signed a landmark deal with Sandoz to sell its Just - Evotec Biologics EU site in Toulouse, plus an indefinite technology license, for a payment potentially exceeding US$ 650 m plus royalties. Also, their strategic partnerships are paying off; they received US$ 75 m from Bristol Myers Squibb in the first half of 2025 from their protein degradation collaboration.

For the full year 2025, Evotec SE has confirmed its guidance, now expecting group revenues between € 760 - 800 m, while the Adjusted Group EBITDA is still guided for € 30 - 50 m. Looking further out, the 2028 outlook targets a Group revenue Compound Annual Growth Rate (CAGR) between 8 - 12% from 2024, aiming for an Adjusted EBITDA margin above 20% by that year.

Evotec SE (EVO) - BCG Matrix: Stars

You're looking at the business units that are currently driving growth for Evotec SE, the ones operating in high-growth areas and commanding significant market presence. These are the areas where the company needs to pour in capital to maintain that leadership position, because if they keep winning, they transition into the Cash Cows of the future.

The Just - Evotec Biologics (JEB) segment is definitely positioned here. It's showing strong momentum, which is exactly what you want from a Star. For the first nine months of 2025 (9M 2025), this segment delivered revenues of €143.4 million, representing a healthy year-over-year growth rate of 11.3%. This growth is a clear indicator of high market demand for their specialized services.

What's particularly compelling is the performance within JEB itself. The business outside of the major Sandoz and Department of Defense (DoD) contracts-the non-Sandoz/non-DoD JEB business-saw an absolutely massive jump. That specific part of the business grew by 105% year-over-year in 9M 2025. Honestly, that kind of acceleration validates the underlying J.POD technology platform as a genuine market differentiator.

Evotec SE is also seeing success through its strategic alliances, which feed into the Star category by demonstrating market acceptance of their technology platforms. For instance, the strategic protein degradation partnership with Bristol Myers Squibb (BMS) delivered a concrete financial milestone. Following the U.S. Food and Drug Administration (FDA) acceptance of an Investigational New Drug (IND) application for a collaboration-developed drug candidate, Evotec announced receipt of a US$ 5 million milestone payment in November 2025. This validates the platform's potential to generate multiple first-in-class products.

The financial profile of the segment is also being enhanced by higher-margin revenue streams. The company has noted that high-margin technology license deals are now expected to contribute a stronger impact on the revenue mix than was initially projected. This shift is key to improving overall profitability, even as the company invests heavily to keep these Stars leading the market.

Here's a quick look at the key performance metrics supporting the Star classification for JEB as of 9M 2025:

The investment thesis here centers on maintaining this high growth rate. If Evotec SE can sustain this market share leadership while the biologics manufacturing market continues to expand, these units are set up to become the company's primary Cash Cows.

The drivers for this Star performance are clearly tied to technology leverage:

• Continued strong demand for the J.POD continuous manufacturing technology.
• Accelerating growth in the non-Sandoz / non-DoD customer base.
• Successful progression of key strategic collaborations, like the BMS deal.
• Anticipation of up to four co-developed molecules entering clinical phase II in the next six to nine months.

Finance: draft 13-week cash view by Friday, focusing on capital allocation to JEB expansion.

Evotec SE (EVO) - BCG Matrix: Cash Cows

You're looking at the Discovery & Preclinical Development (D&PD) segment, which, under the BCG framework, represents the core business unit that should be generating steady, if not spectacular, returns. This is the engine room, the unit with the high market share in a mature or soft market, and the focus now is on maximizing its cash generation through disciplined operations.

The D&PD segment was the largest revenue base for Evotec SE through the first nine months of 2025, bringing in €392.1 million in Group revenues. This figure reflects the ongoing soft demand in the early drug discovery service market, which saw D&PD revenues decrease by (12.3)% compared to the same period in 2024. Still, the segment's established position suggests a high market share that Evotec is looking to maintain while aggressively optimizing costs.

The strategy here is definitely not about pouring capital into aggressive expansion; it's about efficiency. The base business, which is what we are looking at here, saw revenues of €363.6 million in the first half of 2025, down from €390.7 million in the first half of 2024. To counteract this, the Priority Reset program is key. This initiative is targeted to deliver annualized gross savings of €40 million in 2025, with a longer-term goal of achieving €50 million in savings by 2028. This focus on cost optimization is precisely how you 'milk' a Cash Cow to improve cash flow, even when top-line growth is constrained.

Here's a quick look at the segment's profitability as of the mid-year point, which shows the immediate impact of the soft market but also the starting point for the efficiency drive:

Even though the adjusted EBITDA for the first half of 2025 was a loss of €(9.3) million, which is worse than the €(3.8) million loss in H1 2024, the stated goal is to generate cash flow through efficiency improvements, not growth. This segment is expected to provide the stable foundation, supported by core, long-standing service contracts with all Top 20 Pharma companies, which provide that crucial recurring revenue stream. The management's commitment is to support infrastructure that improves efficiency, which should translate directly to better cash flow from this unit.

You should be tracking the success of the cost optimization measures closely. The immediate focus is on turning that negative EBITDA into a positive contribution, even if the revenue growth remains low or flat in the near term. The success of the Priority Reset is defintely what keeps this unit in the Cash Cow quadrant rather than slipping into the Dog category.

• D&PD segment revenue (9M 2025): €392.1 million.
• Priority Reset savings target (2025): €40 million annualized.
• H1 2025 D&PD Adjusted EBITDA: €(9.3) million.
• Base business revenue change (H1 2025 vs H1 2024): (6.9)%.

Evotec SE (EVO) - BCG Matrix: Dogs

Dogs represent business units or products with a low market share in low-growth markets. Evotec SE has actively moved to minimize exposure to these areas as part of its strategic reset, focusing capital and resources on higher-potential programs.

The effort to sharpen focus involved divesting a significant portion of the non-core asset portfolio. Specifically, Evotec SE has axed around 30% of its asset portfolio as part of its cost-cutting push announced in April 2025. This streamlining was designed to shift the focus to high-quality, high-potential assets, moving the company's focus to be sharply defined from target ID to IND (Investigational New Drug application). This move explicitly signals an exit from areas like clinical development.

The exit from clinical development is exemplified by the offloaded EVT 201 asset, also known as dimdazenil, which concluded Evotec SE's foray into clinical development. Furthermore, the company is exiting equity participations, which are treated as non-core financial assets. This includes the planned divestiture of its €70 million holding in Recursion Pharmaceuticals. The FY 2024 disposal figures noted proceeds from the sale of Recursion/Exscientia shares at approximately €70 million.

The move to eliminate capital-intensive, non-core areas also included the gene therapy site closure. Evotec SE completed the layoffs associated with the gene therapy site closure in Q1 2025. This site, Evotec GT in Orth an der Donau, Austria, was shut down as part of a restructuring aimed at optimizing footprint and capacity to increase profits by at least €40 million annually. The restructuring involved eliminating about 400 jobs globally, which represented approximately 7% of the workforce of 5,061 people employed at the end of 2024.

Here is a summary of the key divestitures and non-core exits identified as part of the Dog category management:

The strategic actions taken reflect a clear decision to minimize cash consumption in low-return areas. You can see the impact of this refocusing in the planned R&D expenditure guidance for full-year 2025, which is expected to be in the range of €40 - €50 million, down from €50.9 million in 2024.

• Focus shift: From clinical development to Target ID to IND.
• Workforce reduction: 400 layoffs, about 7% of the 5,061 employees at year-end 2024.
• Non-core asset reclassification: Assets and liabilities of JUST Evotec Biologics EU SAS reclassified to Held for Sale as of 30 July 2025, with Assets classified as Held for Sale at €276.8 million as of 30 September 2025.

Evotec SE (EVO) - BCG Matrix: Question Marks

You're looking at the high-risk, high-reward bets in Evotec SE's portfolio-the Question Marks. These are the areas demanding significant cash investment now, hoping to become tomorrow's Stars. They operate in growing markets but haven't captured substantial market share yet, meaning they currently consume cash without delivering large returns.

The foundation of these Question Marks is the co-owned R&D pipeline. Following the strategy of sharing risk, the pipeline consists of over 100 assets, where approximately 70% are partnered, requiring sustained internal R&D investment to push them through development stages. This investment is a direct cash drain in the short term, characteristic of this quadrant.

A clear example of a high-growth area needing heavy investment is next-generation platform technologies. Evotec SE is expanding its Molecular Patient Database (E.MPD) through consortia like NURTuRE-AKI, which focuses on acute kidney injury (AKI). This initiative, which commenced in early 2025, is supported by industry partners, including Evotec International GmbH, contributing to the £4.7 million funding secured by Kidney Research UK for the AKI biobank expansion. This platform work is designed to unlock precision medicine approaches, representing a high-growth market opportunity.

The Sandoz transaction, finalized on November 4, 2025, represents a massive, long-term bet that could transition a significant part of the business out of the Question Mark phase, or at least provide a substantial cash infusion to fund others. This deal involves the sale of the Just - Evotec Biologics EU site for approximately US$ 350 million in cash, plus future potential payments exceeding US$ 650 million and royalties on up to ten biosimilar molecules. The targeted net originator sales market for these biosimilars is more than US$ 90 billion, signaling the high-growth market potential Evotec is betting on.

The necessary cash consumption to nurture these assets is quantified by the 2025 guidance. Evotec SE has confirmed that internal R&D expenditures for the full fiscal year 2025 are guided between €40 - €50 million. This is a necessary investment to increase market share quickly for these emerging assets, preventing them from becoming Dogs. For context, the 2024 actual R&D expenditure was €50.8 million.

Here is a summary of the key financial figures tied to these high-growth, high-investment areas as of the latest 2025 updates:

The strategy here is clear: you must decide where to place heavy capital to convert these high-potential assets into Stars. The Sandoz deal immediately monetizes one part of the business, providing capital to fuel the R&D spending, which is currently guided to be between €40 million and €50 million for 2025.

You need to review the progress of the co-developed asset pipeline, which is expecting up to four molecules in clinical phase II in the next six to nine months, as these represent the next wave of potential Stars emerging from the current Question Mark investments.