WuXi AppTec raises full-year guidance again: orders accelerate, but quarterly margin falls sequentially

Where did third-quarter results beat expectations, and where were they under pressure?

WuXi AppTec’s third-quarter revenue was 16.64 billion yuan, up 38.0% year on year and 1.1% quarter on quarter, broadly in line with Goldman Sachs’ estimate of 16.59 billion yuan. Revenue from continuing operations rose 43.5% year on year, with the small-molecule research, development and manufacturing business remaining strong. The earlier shift of some TIDES revenue from the first quarter to the second also raised the sequential comparison base.
Non-IFRS net profit was 6.81 billion yuan, up 61.3% year on year and 4.2% above Goldman Sachs’ estimate. Adjusted net margin was 40.9%, above Goldman Sachs’ forecast of 39.4% but below the second quarter’s 42.4%.
Adjusted gross margin was 56.3%, broadly flat with the second quarter’s 56.5%. Reported gross margin fell 1.71 percentage points quarter on quarter to 54.1%, mainly due to higher labor costs and unfavorable foreign exchange effects.

At the end of the third quarter, backlog stood at 76.7 billion yuan, up 36.4% year on year. The growth rate exceeded the first half’s 25.2% and the approximately 20%–25% generally expected by investors in Goldman Sachs’ recent discussions. New orders over the past two quarters totaled approximately 17 billion yuan, providing greater visibility into revenue in 2027.
The company added 20 commercial-stage projects year to date, compared with 11 added in each of 2024 and 2025. As of the third quarter, 42 of its 103 commercial projects had been introduced in the past three years. Goldman Sachs believes these projects could ramp up together and help sustain growth.
The small-molecule research, development and manufacturing business grew 55% year on year in the third quarter, below the first half’s 73% but still showing strong momentum. Goldman Sachs cited the progression of high-quality molecule projects to later stages, advance capacity planning and execution capabilities as drivers, and is positive on diversification beyond GLP-1.

TIDES third-quarter revenue was 4.3 billion yuan, up 52% year on year. Goldman Sachs believes the weaker quarterly performance was primarily related to delivery timing, with more deliveries scheduled for the fourth quarter. The company raised its full-year TIDES revenue growth guidance from 45% to approximately 47%.
In the first nine months, the number of TIDES research, development and manufacturing customers grew 37% year on year, while the number of molecules rose 86%, indicating that the project pipeline continued to expand. Goldman Sachs is watching growth in 2027, capacity utilization and diversification of customers beyond GLP-1.

The company raised its 2026 total revenue guidance from 58.5 billion–60.5 billion yuan to 61 billion–61.9 billion yuan, and its guidance for year-on-year revenue growth from continuing operations from 35%–39% to 40%–42%. The new revenue range is broadly in line with Goldman Sachs’ full-year forecast of 61.4 billion yuan.
Goldman Sachs believes that if the small-molecule research, development and manufacturing business maintains its second- and third-quarter momentum, full-year revenue could exceed the upper end of the new guidance by 1%–2%.
The company narrowed and raised its full-year capital expenditure guidance from 7.5 billion–8.5 billion yuan to 8 billion–8.5 billion yuan, reflecting faster global capacity expansion and the earlier launch of a new Changzhou site. It also raised adjusted free cash flow guidance from 13.5 billion–14.5 billion yuan to 14.5 billion–15.5 billion yuan.
Goldman Sachs maintained its Buy rating, with 12-month target prices of 242.6 Hong Kong dollars for the H shares and 205.9 yuan for the A shares. Its principal downside risks include concentration in the GLP-1 business, pricing pressure from peers and geopolitical uncertainty.