Moderna (MRNA) shares plummeted $9.29, or 22%, to $22.96 in early trading after the company slashed its 2025 sales forecast, sparking investor concerns. The revised guidance cut the expected revenue by approximately $1 billion, setting a new range of $1.5 billion to $2.5 billion. This adjustment reflects the company’s anticipation of various challenges that could impact sales in the coming year.
The majority of Moderna’s projected revenue for 2025 is expected from its Covid-19 vaccine and a newly launched vaccine for respiratory syncytial virus (RSV). However, the lowered expectations stem from multiple factors. CFO Jamey Mock highlighted increased competition within the Covid vaccine market as a primary concern. Moderna’s share in the U.S. retail market for Covid shots has decreased from 48% in 2023 to 40% by the end of 2024, with further declines anticipated. This competitive pressure is compounded by a new partnership between Sanofi and Novavax, where Sanofi (SNY) will co-commercialize Novavax’s Covid vaccine globally, potentially increasing competition for Moderna.
Another significant factor contributing to the sales forecast reduction is the decline in vaccination rates. In the U.S. retail market, there was a noticeable 7% drop in vaccination rates in the fall of 2024 compared to the previous year. This trend suggests a waning public interest or perceived need for Covid boosters, which could further depress sales figures.
Additionally, uncertainties around manufacturing contracts for vaccines in various countries and the unclear recommendations from CDC advisors on RSV revaccination add to the complexities Moderna faces. These elements introduce variability into the company’s sales projections, making it harder to predict demand accurately.
Despite these challenges, Moderna is not standing still. The company is actively managing its expenses, with plans to cut cash costs by $1 billion in 2025 and another $500 million in 2026. This cost management strategy is crucial as it aims at preserving cash reserves while the company diversifies its portfolio beyond its current offerings.
Moderna’s approach to these issues reflects broader industry trends where biotechs pivot from peak pandemic profits to a more sustainable business model focusing on multiple revenue streams and cost efficiency. The company’s earlier projection to break even on an operating cash basis by 2026 has been pushed back to 2028, aligning with these strategic shifts towards long-term financial stability rather than short-term gains from Covid vaccine sales.
The ripple effect of Moderna’s revised forecast swept through the sector, dragging down other vaccine makers. Novavax (NVAX) fell 9% to an intraday low of
$8.38, while BioNTech (BNTX) dropped over 6% to $114.51 in early trading. The declines reflect growing investor uncertainty about the vaccine market as the world transitions beyond the acute phase of the global health crisis.
In summary, Moderna’s lowered sales forecast for 2025 signals a cautious approach to a market still adjusting to post-pandemic realities. The company’s focus on cost reduction and portfolio diversification indicates a strategic recalibration aimed at navigating through current uncertainties while setting a foundation for future growth beyond its Covid-19 success. As the biotech landscape evolves, how Moderna adapts to these changes will be critical in determining its trajectory in the competitive pharmaceutical market.
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