Moderna, Inc. (NASDAQ:MRNA) reported earnings of 55 cents per share in the fourth quarter of 2023, surpassing the Consensus Estimate of a loss of 78 cents. Although earnings declined 85% in the quarter, the company’s revenue exceeded expectations.

Revenue for the quarter was $2.81 billion, beating the Consensus Estimate of $2.55 billion. Despite a 45% year-over-year decline in total revenues, primarily due to lower COVID-19 vaccine sales, Moderna’s shares rose 6.1% in pre-market trading on Feb 22, driven by the positive earnings report.

The company’s better-than-expected performance was attributed to lower operating expenses incurred during the quarter. Investors were surprised by the positive earnings, as they were anticipating a loss in the fourth quarter.

Year to date, Moderna’s stock has declined by 11.9%, compared with the industry’s 1.1% fall.

Quarterly Performance Highlights

Product sales, which include COVID-19 vaccine sales, declined by 43% year over year to $2.79 billion due to lower sales volume compared to the previous year.

Moderna expanded its cumulative market share in the United States to 48% during the fall 2023 COVID season, compared with 37% in 2022.

Grant and collaboration revenues were $18 million, down from $225 million in the year-ago quarter. The company earns collaboration revenues from agreements with several big pharma/biotech companies, including Merck and Vertex Pharmaceuticals.

Selling, general, and administrative expenses were $470 million, up 25% year over year, primarily due to increased spending in employee-related costs and other commercial and marketing expenses.

Research and development expenses were $1.4 billion, up 16% from the year-ago period, primarily due to increased clinical manufacturing activities.

Full-Year Results and 2024 Guidance

For the full year 2023, Moderna reported revenues of $6.8 billion, down 64% year over year. The company reported a loss of $12.33 per share for the full year, compared with earnings of $20.12 in 2022.

Moderna reiterated its product revenue guidance for 2024, expecting to generate around $4 billion in product revenues, mainly from sales of its COVID-19 vaccine and the launch of its RSV vaccine.

The company also maintained its full-year R&D expenses of around $4.5 billion and SG&A expenses of approximately $1.3 billion. It expects capital expenditure to be around $0.9 billion and to end 2024 with a cash balance of around $9 billion.

Pipeline and Other Updates

Moderna has 45 mRNA-based investigational candidates in different stages of clinical studies, targeting various indications, including cancer. The company is evaluating multiple candidates in late-stage studies, including mRNA-1647 (cytomegalovirus vaccine), mRNA-1010 (influenza vaccine), mRNA-4157/V940 (individualized neoantigen therapy), and mRNA-1083 (COVID-19 plus influenza combination vaccine).

The company’s RSV vaccine, mRNA-1345, is currently under FDA review for use in older adults. A final decision is expected before May 12, 2024. If the outcome is positive, a CDC advisory committee could recommend the vaccine’s use in its June meeting.

Moderna intends to report several data readouts this year, including data from pivotal late-stage studies on mRNA-1283, its next-generation refrigerator-stable COVID-19 vaccine, mRNA-1083, and mRNA-1647. Data on mRNA-1283 is expected in the first half of 2024, while data from clinical studies on mRNA-1083 and mRNA-1647 are expected by the end of 2024.

The company’s INT therapy, mRNA-4157, is being co-developed with Merck. After achieving its primary and key secondary endpoints in a phase IIb study in the first half of 2023, two pivotal phase III studies were initiated in the second half of 2023, evaluating the vaccine in melanoma and non-small cell lung cancer indications. Moderna and Merck intend to start clinical studies in additional tumor types later this year.

In conclusion, Moderna’s strong performance in the fourth quarter, along with its optimistic outlook for 2024, highlights the company’s continued growth and innovation in the field of mRNA therapeutics.

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