Against the backdrop of accelerating global biopharmaceutical innovation and increasingly diversified R&D demands, WUXI APPTEC (02359) released its financial report for the third quarter of 2025. In the first three quarters of 2025, the company achieved revenue of RMB 32.86 billion, a year-on-year increase of 18.6%. Notably, revenue from its core continuing operations surged by 22.5%, demonstrating robust growth momentum. The company has raised its full-year guidance for continuing operations revenue growth to 17%-18%, with total annual revenue expected to reach RMB 43.5 billion to RMB 44 billion.

These impressive figures highlight two key drivers behind WUXI APPTEC’s resilience across cycles: the foresight and correctness of its integrated CRDMO (Contract Research, Development, and Manufacturing) strategy, and the formidable "moat" built through its exceptional lean operations under this strategic framework.

**Strategic Focus on CRDMO: Doing the Hard but Right Thing to Build Long-Term Value** In the fast-evolving pharmaceutical R&D landscape, choosing the right strategic direction outweighs short-term tactical execution. WUXI APPTEC’s development trajectory exemplifies this philosophy of "doing the hard but right thing." The company’s unique CRDMO platform seamlessly integrates drug discovery (Research, R) with development and manufacturing (Development & Manufacturing, D&M), creating efficient workflows.

By the end of September 2025, the company’s backlog for continuing operations reached RMB 59.88 billion, a strong 41.2% year-on-year increase—far outpacing revenue growth—laying a solid foundation for future quarters. As the company’s cornerstone, the chemical business generated revenue of RMB 25.98 billion in the first three quarters, up 29.3% year-on-year. The "R" business successfully synthesized and delivered over 430,000 new compounds in the past 12 months, with 250 molecules transitioning from discovery to development ("D") in the first three quarters of 2025. This continuous internal conversion fuels the downstream D&M pipeline, which totaled 3,430 small-molecule projects by September, including 15 new commercial and Phase III clinical-stage projects.

Additionally, the company’s forward-looking investments in new molecular modalities have become a key growth driver. TIDES (oligonucleotides and peptides) revenue soared 121.1% year-on-year to RMB 7.84 billion in the first three quarters, reflecting WUXI APPTEC’s leadership in cutting-edge fields such as peptide drugs, oligonucleotides, PROTACs, and conjugates. This explosive growth is not accidental but stems from strategic foresight and execution—such as accurately anticipating demand for GLP-1-targeted therapies and expanding peptide production capacity ahead of schedule.

Financially, the company’s gross margin exceeded 46%, with adjusted profit margin surpassing 36%. Operating cash flow reached RMB 11.413 billion, up 36.21% year-on-year, while cash reserves (cash and short-term investments) stood at nearly RMB 33 billion.

**Lean Operations and Technological Breakthroughs: Decoding the "Moat" of Efficiency and Quality** If strategy is WUXI APPTEC’s "brain," its operational system is the "heart and skeleton." For a global giant with tens of thousands of employees, lean operations and technological innovation are critical to maintaining competitive advantages.

1. **"Wuxi Speed"**: The ramp-up period for new production lines has been drastically reduced from 22.6 months in 2017 to just 2.4 months in 2024, thanks to scale effects and a robust training system. 2. **Digital "Smart Brain"**: The proprietary Pyxis scheduling system automates real-time production planning, boosting equipment utilization from 60% to 72%—equivalent to adding eight new workshops. 3. **"Eagle Eye" Quality Control**: The AI-driven system reduces human error in solid dosing to 0.05 per 100 batches, nearing perfection and ensuring FDA "zero-defect" inspections.

**Revaluation Prospects for the CRDMO Leader** WUXI APPTEC’s competitive edge lies in its integrated CRDMO model, high-growth new modalities (e.g., TIDES), global client base, and technology-driven efficiency. With a backlog of RMB 59.88 billion, expanding global capacity (e.g., in the U.S., Singapore, and Saudi Arabia), and a clear vision—"making difficult drugs easier to develop"—the company is well-positioned for sustained high-quality growth.

Moving forward, market revaluation will depend on broader recognition of the CXO industry cycle and WUXI APPTEC’s ability to deliver in high-growth segments. For investors seeking certainty and operational excellence, the company’s value proposition remains compelling.