Moderna Just Gave Investors Yet Another Thing to Cheer About

Moderna, a leading biotech company, has delivered a significant boost to investors recently, as reflected in its latest earnings report. The company's share price surged by 3.14% in 2026, marking one of its best-performing years. This surge in value is primarily driven by its cancer vaccine, which has shown promising results in late-stage trials.

Moderna reported a significant turnaround in its third quarter, with revenue rising 29% year-over-year to $1.31 billion. This figure surpassed the analysts' expectations of around $890 million. The company's revenue from U.S. sales, which totaled $780 million, and international sales, which amounted to $533 million, played a pivotal role in this growth.

One of the standout features of this quarter was the strong international sales of COVID vaccines. This sector significantly contributed to Moderna's profitability, which saw a turnaround in the third quarter. The company earned $162 million, or $0.38 per share, compared to a $200 million loss in the same period last year. Analysts had anticipated a more substantial loss of over $1 per share, making this a notable achievement for the company.

The company also reported a 27% reduction in research and development spending to $583 million, indicating a strategic cost-cutting approach. Management has also raised its guidance significantly, expecting full-year revenue to grow between 15% and 25%, up from the previous forecast of up to 10%. This optimistic outlook has been coupled with a reduced R&D budget to approximately $2.7 billion.

The company's optimism is further underscored by its substantial cash reserves, which now stand at $8.1 billion to $8.3 billion, up from the previous forecast of $4.7 billion to $5.2 billion. This increase is a result of the company raising approximately $2.6 billion by selling convertible notes and a $950 million litigation payment.

Moderna's cancer vaccine, developed in collaboration with Merck, has shown exceptional results in a Phase 3 trial. The combination treatment reduced the risk of cancer recurrence or death by 42% compared to Keytruda alone, and cut the risk of the cancer spreading to distant parts of the body by 38%. This development has been highly anticipated by investors, and the company is working towards regulatory submissions, though a specific timeline has not been disclosed.

Apart from the cancer vaccine, Moderna's flu vaccine received FDA approval in August, and its combined flu and COVID-19 vaccine has been approved in Europe and Canada. The company is conducting a limited launch of the 2026-27 flu season vaccine, which is expected to ramp up next year. Despite the stock's substantial gain this year, there is still room for optimism, given the potential of Moderna's pipeline.

However, investors should be mindful of the potential risks, particularly the dependence on international COVID-19 vaccine sales and the pending FDA approval for the flu and COVID-19 combination. As always, gradual investment strategies could be beneficial for those considering a position in Moderna.