Q2 Earnings Recap: West Pharmaceutical Services (NYSE:WST) Tops Drug Development Inputs & Services Stocks

August 24, 2025 at 23:32 PM EDT

WST Cover Image

As the craze of earnings season draws to a close, here’s a look back at some of the most exciting (and some less so) results from Q2. Today, we are looking at drug development inputs & services stocks, starting with West Pharmaceutical Services (NYSE: WST).

Companies specializing in drug development inputs and services play a crucial role in the pharmaceutical and biotechnology value chain. Essential support for drug discovery, preclinical testing, and manufacturing means stable demand, as pharmaceutical companies often outsource non-core functions with medium to long-term contracts. However, the business model faces high capital requirements, customer concentration, and vulnerability to shifts in biopharma R&D budgets or regulatory frameworks. Looking ahead, the industry will likely enjoy tailwinds such as increasing investment in biologics, cell and gene therapies, and advancements in precision medicine, which drive demand for sophisticated tools and services. There is a growing trend of outsourcing in drug development for nimbleness and cost efficiency, which benefits the industry. On the flip side, potential headwinds include pricing pressures as efforts to contain healthcare costs are always top of mind. An evolving regulatory backdrop could also slow innovation or client activity.

The 8 drug development inputs & services stocks we track reported a very strong Q2. As a group, revenues beat analysts’ consensus estimates by 4.4%.

Luckily, drug development inputs & services stocks have performed well with share prices up 13.6% on average since the latest earnings results.

Best Q2: West Pharmaceutical Services (NYSE: WST)

Founded in 1923 and serving as a critical link in the pharmaceutical supply chain, West Pharmaceutical Services (NYSE: WST) manufactures specialized packaging, containment systems, and delivery devices for injectable drugs and healthcare products.

West Pharmaceutical Services reported revenues of $766.5 million, up 9.2% year on year. This print exceeded analysts’ expectations by 5.6%. Overall, it was a stunning quarter for the company with an impressive beat of analysts’ full-year EPS guidance estimates and full-year revenue guidance exceeding analysts’ expectations.

West Pharmaceutical Services Total Revenue

Interestingly, the stock is up 9% since reporting and currently trades at $247.85.

Is now the time to buy West Pharmaceutical Services? Access our full analysis of the earnings results here, it’s free.

Fortrea (NASDAQ: FTRE)

Spun off from Labcorp in 2023 to focus exclusively on clinical research services, Fortrea (NASDAQ: FTRE) is a contract research organization that helps pharmaceutical, biotech, and medical device companies develop and bring their products to market through clinical trials and support services.

Fortrea reported revenues of $710.3 million, up 7.2% year on year, outperforming analysts’ expectations by 12%. The business had a stunning quarter with a beat of analysts’ EPS estimates and full-year revenue guidance exceeding analysts’ expectations.

Fortrea achieved the biggest analyst estimates beat among its peers. The market seems happy with the results as the stock is up 26.5% since reporting. It currently trades at $8.32.

Is now the time to buy Fortrea? Access our full analysis of the earnings results here, it’s free.

Weakest Q2: Azenta (NASDAQ: AZTA)

Serving as the guardian of some of medicine's most valuable materials, Azenta (NASDAQ: AZTA) provides biological sample management, storage, and genomic services that help pharmaceutical and biotechnology companies preserve and analyze critical research materials.

Azenta reported revenues of $143.9 million, flat year on year, falling short of analysts’ expectations by 3.8%. It was a softer quarter, leaving some shareholders looking for more.

Azenta delivered the weakest performance against analyst estimates and slowest revenue growth in the group. As expected, the stock is down 2.7% since the results and currently trades at $31.55.

Read our full analysis of Azenta’s results here.

Medpace (NASDAQ: MEDP)

Founded in 1992 as a scientifically-driven alternative to traditional contract research organizations, Medpace (NASDAQ: MEDP) provides outsourced clinical trial management and research services to help pharmaceutical, biotechnology, and medical device companies develop new treatments.

Medpace reported revenues of $603.3 million, up 14.2% year on year. This number beat analysts’ expectations by 11.3%. It was a stunning quarter as it also recorded an impressive beat of analysts’ organic revenue estimates and full-year EBITDA guidance exceeding analysts’ expectations.

Medpace pulled off the highest full-year guidance raise among its peers. The stock is up 50% since reporting and currently trades at $463.50.

Read our full, actionable report on Medpace here, it’s free.

Charles River Laboratories (NYSE: CRL)

Named after the Massachusetts river where it was founded in 1947, Charles River Laboratories (NYSE: CRL) provides non-clinical drug development services, research models, and manufacturing support to pharmaceutical and biotechnology companies.

Charles River Laboratories reported revenues of $1.03 billion, flat year on year. This print surpassed analysts’ expectations by 4.6%. Overall, it was a stunning quarter as it also put up a solid beat of analysts’ organic revenue estimates and a beat of analysts’ EPS estimates.

The stock is down 3.4% since reporting and currently trades at $161.84.

Read our full, actionable report on Charles River Laboratories here, it’s free.

Market Update

In response to the Fed’s rate hikes in 2022 and 2023, inflation has been gradually trending down from its post-pandemic peak, trending closer to the Fed’s 2% target. Despite higher borrowing costs, the economy has avoided flashing recessionary signals. This is the much-desired soft landing that many investors hoped for. The recent rate cuts (0.5% in September and 0.25% in November 2024) have bolstered the stock market, making 2024 a strong year for equities. Donald Trump’s presidential win in November sparked additional market gains, sending indices to record highs in the days following his victory. However, debates continue over possible tariffs and corporate tax adjustments, raising questions about economic stability in 2025.

Want to invest in winners with rock-solid fundamentals? Check out our Strong Momentum Stocks and add them to your watchlist. These companies are poised for growth regardless of the political or macroeconomic climate.

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