Moderna Stock Plummets 20% After Lowering Guidance on EU Sales and U.S. Vaccine Market Challenges

Moderna experienced a significant 20% drop in its stock price on Thursday after reporting second-quarter results that, while beating revenue expectations, prompted the company to sharply reduce its full-year sales forecast. The biotech firm now anticipates 2024 product revenue between $3 billion and $3.5 billion, down from its previous estimate of $4 billion.

The revised guidance is attributed to lower-than-expected sales in Europe, heightened competition in the U.S. vaccine market, and potential delays in international revenue. Moderna’s newly approved respiratory syncytial virus (RSV) vaccine, mRESVIA, began shipping in the U.S., but faces stiff competition from existing RSV vaccines by Pfizer and GSK.

Moderna CEO Stephane Bancel highlighted the increased competition for both RSV and Covid vaccines and noted difficulties in securing new contracts with European governments due to tight budgets and existing agreements with Pfizer and BioNTech. The ongoing conflict in Ukraine is also putting strain on government finances.

Despite the current challenges, Bancel expressed optimism for a recovery, projecting sales growth in 2025 and a break-even point by 2026, driven by new product launches.

For the second quarter, Moderna reported:

• Loss per share: $3.33, better than the expected loss of $3.39
• Revenue: $241 million, exceeding the $132 million forecast

Revenue from Moderna’s Covid vaccine fell 37% year-over-year, contributing to the company’s net loss of $1.28 billion. However, Moderna achieved a reduction in costs, including a significant drop in sales expenses and a 19% decrease in selling, general, and administrative costs. R&D expenses rose by 6% to $1.2 billion due to increased personnel costs.

Despite these setbacks, Moderna’s stock has risen nearly 20% this year, reflecting confidence in its pipeline and messenger RNA technology. The company is advancing 45 products in development, including a combination vaccine for Covid and flu, and a personalized cancer vaccine with Merck.