Moderna’s Surprise Profit: A Turning Point for the Biotech Company
After a tumultuous year, Moderna has finally posted a surprise profit for the third quarter, exceeding Wall Street estimates. The biotech company’s cost-cutting efforts have started to pay off, and sales of its Covid vaccine have surpassed expectations.
A Net Income of $13 Million
Moderna reported a net income of $13 million, or 3 cents per share, for the third quarter. This is a significant improvement from the net loss of $3.63 billion, or $9.53 cents per share, reported in the same period last year.
Cost-Cutting Efforts
The company is working towards achieving $1.1 billion in savings by 2027, a goal that seems within reach. Moderna’s cost-cutting efforts have already started to bear fruit, with expenses slashed significantly. The company’s focus on reducing costs has enabled it to recover from the rapid decline of its Covid business.
New Products and Approvals
Moderna’s vaccine against respiratory syncytial virus (RSV) has been approved, marking the company’s second commercially available product. The biotech company plans to file for approval of its experimental “next-generation” Covid vaccine and combination shot targeting Covid and the flu before the end of the year.
Increased Sales and Shipments
Moderna’s newest Covid vaccine has seen significant benefits after winning approval in the U.S. three weeks earlier than the last iteration of the shot did in 2023. The company was able to ship out doses to pharmacies and healthcare providers more quickly, reaching more patients sooner. In the first week of the vaccine’s launch, Moderna shipped twice as many products globally than it did in 2023.
CEO Stéphane Bancel Weighs In
“I think the earlier launch and a steeper ramp drove a much higher sales number” for the Covid vaccine, Moderna CEO Stéphane Bancel said in an interview. He added that “this was a big cost reduction quarter, and we’re going to continue to do that.”
Third-Quarter Results
Moderna booked third-quarter sales of $1.86 billion, slightly higher than the $1.83 billion in revenue it recorded during the same period a year ago. The majority of that total came from its Covid shot, including $1.2 billion in U.S. sales and roughly $600 million from international markets.
RSV Vaccine Sales
The company’s RSV vaccine saw lower-than-expected sales, with $10 million in U.S. sales. This was due to the vaccine being approved and recommended by regulators later in the contracting season, when many vaccine distributors had already completed their orders.
Full-Year Guidance
Moderna reiterated its full-year 2024 product sales guidance of roughly $3 billion to $3.5 billion. Despite a challenging year, the company remains optimistic about its future prospects.
Pipeline and Development
Moderna currently has 45 products in development, with plans to bring 10 of them to the market over the next three years. The biotech company is developing a standalone flu shot, a personalized cancer vaccine with Merck, and shots for latent viruses, among other products.
Cost of Sales and Expenses
The cost of sales for the third quarter was $514 million, down 77% from the same period a year ago. Research and development expenses decreased by 2% to $1.1 billion, while selling, general, and administrative expenses fell by 36% to $281 million.
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