Moderna Reports Larger-Than-Expected Quarterly Loss Amid Vaccine Demand Decline

CAMBRIDGE, Mass. (AP) — Moderna Inc. reported a bigger-than-expected quarterly loss on Friday, driven largely by a non-cash charge as the company navigates weakening demand for its COVID-19 vaccine. For the fourth quarter of 2024, Moderna posted a net loss of $1.12 billion, or $2.91 per share, significantly down from a profit of $217 million, or 55 cents per share, during the same period last year.

The company’s financial struggles come as it attempts to pivot from its once-thriving COVID-19 vaccine business, pointing to increased competition and declining vaccination rates. In premarket trading, shares of Moderna fell by more than 4% following the announcement.

Moderna’s loss includes a $238 million charge related to the termination of a contract manufacturing agreement. “As we looked at our manufacturing footprint, we believed we did not need that particular [manufacturer] and tried to eliminate the potential waste related to that capacity,” said Chief Financial Officer Jamey Mock in an interview.

The total revenue for the quarter was $966 million, less than half of the $2.8 billion reported a year earlier. The decrease was attributed to lower sales of its COVID-19 vaccine, which generated $923 million, down 66% from the previous year. The drop in revenue from international markets and the earlier-than-usual launch of the updated vaccine contributed to this decline.

Though analysts had projected the COVID vaccine sales to reach $909 million, the company acknowledged the impact of phasing out advance purchase agreements with specific countries. Regarding its respiratory syncytial virus (RSV) product, Moderna reported $15 million in U.S. sales, exceeding analysts’ estimates of $13 million.

“Should those potential headwinds all hit, that’s what would bring us to the low end of our guidance,” Mock said, emphasizing the company’s commitment to addressing challenges facing its vaccine products.

Moderna’s operational adjustments come with an ambitious pipeline that includes plans for 10 product approvals over the next three years. Recent submissions for regulatory approval included a next-generation COVID shot and a combination shot targeting COVID and influenza.

Looking forward, the company reiterated its sales guidance for 2025, projecting between $1.5 billion and $2.5 billion in product sales. However, Moderna expects most of this revenue to occur in the latter half of the year, with a modest $200 million anticipated in the first half.

Cost reductions have been a focal point for the company, with expenses decreasing by 27% compared to 2023. Moderna has emphasized its commitment to cutting costs by up to $1 billion by the end of 2025.

While COVID vaccine sales have faltered, the company aims to bolster its standing in the vaccine market with innovative product offerings and strategic adjustments in its manufacturing operations. Moderna is developing new vaccines targeting various illnesses and anticipates further regulatory responses towards the end of the year.