Moderna is in vaccine purgatory.

With its Covid-19 vaccine so last year and its RSV vaccine — widely expected to receive approval from the US Food and Drug Administration sometime before July — still on the horizon, the biotech giant exists between eras. Still, despite a massive downturn in revenue from a year ago, Moderna still beat analysts’ fourth-quarter expectations on Thursday, with investors optimistic about a rosy RSV-driven future to come. 

Jab Left, Jab Right

Call it the great resetting of expectations, or the end of pandemic-era boom times. The waning Covid years have effectively crushed Moderna’s overall respiratory franchise (waning being a relative term; the two weeks after Christmas saw roughly 35,000 Covid hospitalizations each, per the CDC). Full-year revenue for the unit in 2023 fell by about two-thirds to $6.7 billion, and the company said Thursday that it expects revenue to tumble again to about $4 billion in 2024. That put the company solidly in the red in 2023, with a loss of $4.7 billion after posting an $8.4 billion profit in 2022.

Still, Moderna reported an unexpected profit of $217 million in its most recent quarter. Combined with out-with-the-old, in-with-the-new optimism, it was enough to spark a 15% share price bump. Despite its RSV vaccine being a relative late-comer on the emerging market, investors still may have reason to believe Moderna’s version will have a competitive advantage:

• A recent late-stage trial suggested its RSV vaccine candidate may have slightly lower durability than the competition, but the company is championing its overall efficacy and safety. More importantly, Moderna is touting its use of mRNA technology to create a pre-filled syringe vaccine, while competitors require multiple preparatory steps — a perk the company hopes could make its version a favorite among pharmacists.
• GSK’s RSV vaccine, Arexvy, did $1.5 billion in sales last year, while Pfizer’s Abrysvo recorded $890 million; some analysts believe the overall RSV vaccine market could see annual sales of $10 billion within a few years.

Think Different: Moderna touts its RSV vaccine as just one of several uses of mRNA technology that it says is still its baseline appeal for investors. The company has 45 products in development, with nine already in late-stage trials — including a flu-covid combo vaccine that some see as a potential blockbuster. “I believe 2024 will be a year where many observers of Moderna go from thinking of us as a Covid vaccine company to seeing Moderna as an mRNA platform company with several products approved and more progress on the way for 2025 and beyond,” Chief Executive Stéphane Bancel said during the earnings call. If several products hit, the company could see sales growth return next year, with 2026 marking a potential return to break-even – no global pandemic required.

These electric vehicle manufacturers are in serious need of a recharge.

With the triple threat of poorer-than-expected earnings, job cuts, and disappointing production guidance, luxury EV startups Rivian and Lucid look to be driving down a bumpy road in 2024. 

Not Enough Juice

As much enthusiasm as the Biden administration, car companies, and green-conscious drivers have for EVs, reality is preventing them from fully penetrating the market. Most car makers with ambitions to go all-electric in just a few years have scaled back those plans in the face of slowing demand, choosing instead to focus on more popular hybrid vehicles. 

The biggest hindrance is cost. Interest rates are still high, preventing many people from big purchases anytime soon, and EVs are still a big purchase: the average price paid for a new EV in January was $55,353, according to Kelley Blue Book. While that’s 11% cheaper than a year ago, it’s still not close to gas-powered cars. Plus, the “average” EV is likely coming from makers like Ford and Hyundai, while the cheapest Rivian and Lucid models still cost about $70,000. Not even up to $7,500 in federal tax credits can make that a bargain: 

• Rivian — which lost more than over $40,000 on every vehicle it delivered in the last three months of 2023 — took a $5.4 billion hit for the full-year 2023, while its cash and equivalents slumped to $7.85 billion from $11.6 billion.
• The company expects to build a similar number of vehicles this year, about 57,000, but it plans to do so after cutting another 10% of its workforce, its third round of layoffs in the past year and a half.

Lucid didn’t show much promise, either, posting a fourth-quarter loss on Wednesday of $653.8 million and forecasting it’ll build only 9,000 cars this year. Its stock has fallen nearly 30% already in 2024. 

Do As I Say, Not As I Do: Elon Musk, CEO of Tesla, is expressing solidarity with his fellow EV makers. Just kidding, here’s what he actually posted on X: “current trajectory has [Rivian] bankrupt in about six quarters. Maybe that trajectory will change, but so far it hasn’t.” He also went after Lucid, saying, “Their Saudi sugar daddy is the only thing keeping them alive” — the Saudi Arabia Public Investment Fund owns a 60% stake in Lucid. The funny thing is, though, Musk once tried to take Tesla private via backing from the PIF, and Saudi Prince Al Waleed bin Talal Al Saud even owns a sizable piece of X. His trash talk has no fear or favor.

Would you peg Putin as an Oreo dunker or cruncher? 

Dirk Van de Put, CEO of Mondelez, the US multinational behind such confectionary brands as Oreos, Sour Patch Kids, and Milka, gave a strikingly candid interview to the Financial Times on Thursday in which he said investors just aren’t that bothered about whether the company continues to do business in Russia.

Not Russian to Get Out

Van de Put told the FT that the company has received no pressure from shareholders to stop doing business with Russia since it invaded Ukraine, adding that shareholders don’t “morally care” about the issue. At most, he said some European funds had asked about it, but there was no impetus to get out of the Russian market. 

When the Russian invasion of Ukraine began, many Western companies pulled out of the market immediately. Others were a little slower to extricate themselves, like McDonald’s, and some gave up on trying to leave because of the costs they’d incur, like Philip Morris. Van de Put argues that exiting the country would do no one any good:

• He pointed to companies including Danone and Carlsberg that were forced to sell off their operations to the Russian state. “They all went to friends of Putin,” Van de Put said, adding: “You can bet that the cash they generate [that] goes to the war is much bigger than the taxes we would pay.”
• Despite Western sanctions, Russia has managed to keep its wartime economy surprisingly buoyant, partly due to the Russian government propping up certain sectors with subsidies.

Candy Crushin’: “We try to not be confrontational or make big statements and just get on with our business,” Van de Put told the FT, although he might be slightly fudging the company’s approach. In a March 2022 email to employees, Van de Put said the company would be “scaling back all non-essential activities in Russia while helping maintain continuity of the food supply,” However, data gathered by Bloomberg suggests the company is modestly increasing its activity there. You know what they say about oligarchs and cookie jars.