Moderna revised its 2025 sales forecast downward by $1 billion on Monday, citing a slow rollout of its respiratory syncytial virus (RSV) vaccine and declining demand for its COVID-19 vaccine. The company now projects annual revenue between $1.5 billion and $2.5 billion, primarily in the second half of the year, falling short of its previous estimate of $2.5 billion to $3.5 billion and the market expectation of $2.95 billion, as reported by LSEG.
In response, Moderna has discontinued or deprioritized several initiatives, including a heart disease drug developed with AstraZeneca and an RSV vaccine for infants in collaboration with Merck. Instead, the company is refocusing on its core strength: developing innovative mRNA-based products to address a broader range of health challenges.
Moderna’s sales are being dragged down by the slower-than-expected uptake of its RSV shot for adults over 60, which was approved in May, and by a lackluster launch in the EU for its COVID/flu shot, which was launched late last year. The company, which has two mRNA-based vaccines on the market, posted a loss in the second quarter as its cost of goods sold and selling, general, and administrative expenses rose.
The mRNA-based RSV vaccine has been in distribution for just under a month. Still, the company hasn’t yet seen significant purchases from the major distributors that will help it reach its targeted 500,000 to 1.2 million doses per day, or $1.75 billion in sales this year, as it seeks to recoup development costs and make money on the product. “The sales ramp for RSV is expected to be moderate, given the limited number of contracts at this point and continued competition,” Chief Financial Officer James Mock said in a conference call with investors.
A delay in the launch of the company’s flu shot could also push back its sales and profit goals. Moderna is waiting on approval for a combination shot being tested in a trial with Blackstone Life Sciences and a Merck-tied cancer vaccine, and it has other studies in the works for individualized neoantigen therapy and a cancer drug.
The company finished the second quarter with $2.478 billion in cash and cash equivalents, down about 15% from the end of last year. That includes a sizable investment in its pipeline, which is now expected to contain 10 new products.
Based on current projections, Moderna will need to hit its break-even target in 2028, and even that could fall short of expectations if the company continues to be held hostage by unpredictable demand for its vaccines. The shift in focus to a prioritized portfolio of existing products and a focus on cost reduction reflects that global vaccine demand is more volatile than ever and that companies should be ready to adapt to changing conditions as they arise. That approach is a good one, but it will require patience on the part of investors.
