Moderna’s stock pops after surprise quarterly profit, even as COVID sales continue to slide

Revenue also beat analysts’ expectations, totaling $2.811 billion in the fourth quarter, down from $5.084 billion a year earlier but ahead of the FactSet consensus of $2.511 billion.

The quarterly results were boosted by the recognition of $600 million in deferred revenue related to Gavi, the Vaccine Alliance, a global health partnership focused on increasing vaccine access, Moderna said.

Moderna also reported full-year cost of sales of $4.7 billion, lower than its previous guidance of $5 billion, as the company’s efforts to resize its manufacturing capacity and improve productivity are starting to pay off, Chief Financial Officer Jamey Mock told MarketWatch. “We’re encouraged by that heading into 2024,” Mock said.

Sales of Moderna’s Spikevax COVID vaccine came to $2.8 billion in the fourth quarter and totaled $6.7 billion for fiscal 2023, whereas the company had previously said it expected full-year sales of at least $6 billion.

Moderna’s share of the U.S. retail COVID vaccine market hit 48% in fall 2023, the company said, up from 37% in 2022. Vaccination rates, however, were “not as strong as we had once hoped,” Mock said, falling about 25% to 30% from a year earlier in the U.S. The company hopes the 2023 vaccination rates are the floor, and will rebound in years to come, he said.

While 2023 marked a transition year for Moderna as COVID shifted to an endemic phase, the company “made significant pipeline advancements across infectious diseases, oncology and rare diseases,” Chief Executive Stephane Bancel said in a statement.

The company is now looking to launch its second product, a respiratory syncytial virus vaccine for older adults. A U.S. regulatory decision on the shot is expected by May 12, Moderna said Thursday, and if the Food and Drug Administration gives the green light, the Centers for Disease Control and Prevention’s immunization advisory committee could review the vaccine at a meeting in late June.

Moderna will have to contend with GSK PLC
GSK,
-0.19%
and Pfizer Inc.
PFE,
+0.29%,
which already have RSV shots on the market, but the company is hoping its ready-to-use, pre-filled syringes will give it a competitive edge.

The drugmaker said Thursday that it expects to have potential efficacy data later this year on its experimental vaccine for cytomegalovirus, a common virus that can infect babies during pregnancy and cause birth defects.

An individualized cancer vaccine that Moderna is developing with Merck & Co. Inc.
MRK,
+0.59%
is also moving ahead, Moderna said Thursday. The therapy, which is already being studied in melanoma and non-small cell lung cancer, will move into clinical studies in other tumor types this year, Moderna said.

Moderna on Thursday also reiterated its 2024 full-year product sales guidance of about $4 billion.

Moderna shares have dropped 11.9% in the year to date, while the S&P 500
SPX
is up 4.4%.