Moderna's shares experienced a significant drop during intraday trading on Monday following a revision of its full-year revenue outlook. The biotechnology company is now aiming for a reduction in cash expenses amounting to $1 billion by 2025, as part of its ongoing cost efficiency initiatives. The company's revenue expectations have been adjusted to a range between $1.5 billion and $2.5 billion for the current year, which is a notable decrease from its earlier projections of $2.5 billion to $3.5 billion.
According to market consensus on FactSet, analysts had anticipated sales reaching approximately $2.92 billion. Consequently, Moderna's stock plummeted 21% during Monday's trading session. Looking ahead, Moderna expects that a substantial portion of its estimated revenue will be generated in the latter half of the year, primarily driven by sales of its COVID-19 vaccine, Spikevax, and its respiratory syncytial virus vaccine, mRESVIA. For the year 2024, Moderna predicts its product sales will fall between $3 billion and $3.1 billion, with Spikevax contributing the majority of this figure.
The vaccine is projected to generate more than $3 billion in sales, while mRESVIA is expected to make only a minimal contribution. The company reported revenues of $1.7 billion in the United States and approximately $1.3 billion to $1.4 billion from international markets. In November, Moderna disclosed third-quarter sales of $1.8 billion for Spikevax and a mere $10 million for mRESVIA.
The lower-than-expected sales for the RSV vaccine were attributed to its delayed approval during the contracting season, which saw many customers completing their orders ahead of availability. As part of its financial strategy, Moderna is implementing cash cost reductions totaling $1 billion this year, which encompass expenses related to sales, research and development, as well as selling, general, and administrative costs.
The company anticipates starting 2025 with roughly $6 billion in cash and investments and is optimistic about realizing an additional $500 million in cost savings by 2026. Chief Executive Stephane Bancel commented on the financial review, stating: "We reduced our cash operating costs by over 25% compared to 2023 and aim to reduce 2025 cash costs by $1 billion with a plan for an additional $500 million in cost savings by 2026." He reiterated the company's commitment to three strategic priorities: driving sales growth, achieving up to 10 product approvals over the next three years, and instituting robust cost reductions across its operations. Investors are looking forward to the upcoming release of Moderna's fourth-quarter and full-year 2024 results, which are scheduled for February..