Moderna Amazon on Thursday reported surprising third-quarter earnings, beating Wall Street estimates, as its cost-cutting efforts held up and sales of its Covid-19 vaccine rose higher than expected.
The biotechnology company reported net income of $13 million, or 3 cents per share, for the third quarter. That compares to a net loss of $3.63 billion, or 9.53 cents per share, reported in the same period last year.
Moderna shares rose nearly 9% in premarket trading Thursday.
Moderna has been cutting expenses, with a recently announced goal of $1.1 billion in savings by 2027, as it tries to recover from the rapid decline of its coronavirus-related business. It's the first quarter to include sales of Moderna's vaccine against respiratory syncytial virus, or RSV, the second product ever commercially available.
Before the end of the year, the company plans to file for approval for its experimental “next generation” Covid vaccine and combination injection targeting Covid and influenza. This year, Moderna also expects to apply for expanded approval for its RSV vaccine, which targets at-risk adults ages 18 to 59.
Moderna Inc. said Thursday its latest COVID-19 vaccine saw benefits after gaining approval in the United States three weeks before the vaccine's last release in 2023, allowing the biotech company to “meet demand more effectively.” The company was able to ship doses to pharmacies and health care providers and get them into the arms of more patients sooner.
“I think the earlier launch and steeper slope led to a much higher sales number” for the Covid vaccine, Moderna CEO Stephane Bancel said in an interview. Bancel noted that during the first week of the vaccine launch, the company shipped twice as many products globally as it did in 2023.
“This quarter was a significant cost reduction, and we will continue to do so,” he added.
Here's what Moderna reported for the third quarter compared to what Wall Street was expecting, based on a poll of analysts conducted by LSEG:
Earnings per share: 3 cents vs. an expected loss of $1.90 Revenue: $1.86 billion vs. $1.25 billion expected
Moderna achieved sales in the third quarter of $1.86 billion, which is slightly more than its revenue of $1.83 billion recorded during the same period last year. The vast majority of that total came from the Covid vaccine, including $1.2 billion in U.S. sales and about $600 million from international markets.
The company's third-quarter revenue also included $10 million in U.S. sales of its RSV shot, which received approval in May. Moderna said sales of that dose have been lower than expected since it was approved and recommended by regulators later in the contracting season, when many vaccine distributors had already completed their orders.
Analysts were expecting sales of $132 million for the RSV vaccine, according to estimates compiled by StreetAccount. The Moderna RSV shot has so far been approved in the US, EU, Norway, Iceland and Qatar.
The company reiterated its full-year 2024 product sales guidance of approximately $3 billion to $3.5 billion. Last quarter, Moderna lowered its outlook on expected sales declines in Europe, the “competitive environment” for respiratory vaccines in the United States and the possibility of international revenues being delayed until 2025.
Moderna shares are down nearly 50% this year as investors consider its path forward post-Covid. The company is betting on a pipeline built around its messenger RNA platform, the technology used in its Covid vaccine and RSV shot.
The biotech company currently has 45 products in development, and expects to bring 10 to market within the next three years.
Moderna is developing a standalone flu vaccine, a personalized cancer vaccine in collaboration with Merck, and shots for latent viruses, among other products.
Cost of sales for the third quarter was $514 million, down 77% from the same period last year. That includes $214 million in write-offs of unused doses of the Covid vaccine and $27 million in charges related to the company's efforts to shrink its manufacturing footprint, among other costs.
R&D expenses fell 2% to $1.1 billion compared to the same period in 2023. Moderna said the decline was primarily due to lower clinical development and manufacturing costs, citing lower spending on clinical trials, among other factors.
Meanwhile, selling, general and administrative expenses for the period decreased 36% to $281 million compared to the third quarter of 2023. SG&A expenses typically include the costs of promoting, selling and delivering the company's products and services.
