Moderna, the biotech company known for its Covid vaccine, has reported an unexpected quarterly profit despite a decline in vaccine sales. The company’s fourth-quarter results reveal a net income of $217 million, or 55 cents per share, compared to a net income of $1.47 billion, or $3.61 per share, during the same period the previous year. Moderna’s revenue for the quarter reached $2.81 billion, with Covid shot sales dropping by 43% compared to the previous year.
The decline in vaccine sales is attributed to lower vaccine volumes, although this was partially offset by a higher average selling price of the jab. Moderna also recorded $600 million in deferred revenue related to its work with Gavi, a global vaccine organization. However, the company’s CFO, Jamey Mock, downplayed the significance of the deferred revenue, stating that it was “kind of a nonevent” and not the main reason for beating earnings expectations.
Mock highlighted the lower-than-expected cost of sales as one of the main reasons for the company’s positive earnings report. The cost of sales for the fourth quarter was $929 million, contributing to a total of $4.69 billion for the full year. This includes costs related to scaling back manufacturing of the Covid shot and write-downs of unused doses.
Despite the decline in Covid vaccine sales, Moderna remains optimistic about its future prospects. The company reiterated its full-year 2024 sales guidance of approximately $4 billion and expects sales from the Covid shot to decrease further in 2024. Moderna is also awaiting FDA approval for its vaccine against respiratory syncytial virus (RSV), which could contribute to future revenue.
Looking ahead, Moderna plans to reduce expenses in 2024, including research and development costs. The company aims to increase its discipline and return to sales growth by 2025. It currently has 45 products in development, with nine in late-stage trials. These include a combination shot targeting Covid and the flu, as well as a personalized cancer vaccine being developed in collaboration with Merck.
In conclusion, Moderna’s unexpected quarterly profit demonstrates the company’s resilience amid a decline in Covid vaccine sales. While lower volumes affected revenue, a higher average selling price and lower cost of sales contributed to the positive results. Moderna remains focused on its pipeline of products in development and aims to return to sales growth in the coming years. With ongoing innovation and a strong position in the biotech industry, Moderna is poised for future success.
