Moderna stock plunged Thursday after the company cut its full-year outlook early Thursday despite delivering nearly double the sales Wall Street expected in the second quarter.
For the year, the biotech company and Covid vaccine maker now expects $3 billion to $3.5 billion in sales, below its previous guidance for about $4 billion. The guidance comes as Moderna launches its second-ever product, a vaccine for respiratory syncytial virus, or RSV.
"The update in product sales is driven by three primary factors: very low European Union sales in 2024, potential revenue deferrals for certain international sales in 2025 and an increasingly competitive environment for respiratory vaccines in the U.S.," the company said in a news release.
Moderna stock tumbled 21.2% to 94.17. Shares undercut their 200-day moving average, according to MarketSurge.
Moderna Stock: Sales Tumble, But Beat
During the second quarter, Moderna's sales tumbled 30% to $241 million. Despite the dive, sales handily beat projections for $128 million. That included $184 million from Spikevax, the Covid shot, and $57 million in collaboration and grant money. Analysts projected $100 million to $133 million in Spikevax sales, according to various analysts' reports.
"This represents a 37% reduction from the prior year for the same period, unsurprising as the Covid vaccine market transitions to an endemic setting with lower than previously expected vaccination rates," William Blair analyst Myles Minter said in a report.
The company also lost $3.33 per share, narrowing from a loss of $3.62 a share in the year-ago period. That was roughly in line with forecasts for a loss of $3.35 per share, according to FactSet.
Contracting has mostly wrapped in the "highly competitive Covid market," Moderna said in its news release. The biotech company competes against Pfizer and BioNTech's Comirnaty and Novavax's Nuvaxovid.
Moderna owns about 40% of the Covid vaccine market, Needham analyst Joseph Stringer said in a report. He estimates Pfizer and BioNTech hold the other 60%.
"The company now expects very low European Union sales in 2024," Moderna said. "In the rest of the world, the company has multiple signed contracts in place, with some potential revenue deferrals into 2025."
RSV Vaccine Launch Underway
Meanwhile, the company has launched its RSV vaccine for adults age 60 and older. The shot, dubbed mResvia, is based on the same messenger RNA technology that it uses in Spikevax.
Unlike its rivals from Pfizer and GSK, Moderna's vaccine uses a pre-filled syringe, which the company contends will simplify the vaccination process. Moderna says it's targeting the pharmacy segment in the U.S. and trying to reaching "vaccinators in a highly competitive market."
Needham's Stringer expects sales of the two vaccines — Spikevax and mResvia — will be key drivers for Moderna stock in the back half of 2024. He has a hold rating on shares.
"We have a cautious outlook on both," he said. "We believe Covid vaccination rates will decline faster than expected and mResvia will face competitive pressure from approved RSV vaccines Arexvy (from GSK) and Abrysvo (from Pfizer)."
Guidance Cut Hampers Shares
The guidance cut hit Moderna stock, however. At the midpoint, sales would fall 52.5% year over year. Analysts projected a smaller tumble to $4.14 billion in sales.
Moderna stock has a Relative Strength Rating of 78 out of a best-possible 99. This means shares rank below the top fifth of all stocks when it comes to 12-month performance, according to IBD Digital.
Follow Allison Gatlin on X, the platform formerly known as Twitter, at @IBD_AGatlin.
