Novavax Inc. (Nasdaq: NVAX) reported a fiscal 2023 third-quarter loss that narrowed from the corresponding quarter of fiscal 2022. The pharmaceutical company’s top and bottom lines exceeded estimates. Additionally, while issuing 1Q 2024 revenue guidance, Novavax also downwardly revised its revenue outlook for FY 2023. The stock of Novavax ended Friday’s trading session at $6.24, down $0.47 or -7.00% from the prior close.
Gaithersburg, Maryland-based company reported third-quarter revenues of $186.99 million, down 74.50% from $734.58 million in the similar quarter of fiscal 2022.
For the third quarter, which ended September 30, 2023, Novavax posted a net loss of $130.78 million, or $1.26 per share, compared with a net loss of $168.61 million, or $2.15 per share, in the quarter ended September 30, 2022.
Analysts surveyed by LSEG anticipated Novavax to post a net loss of $1.67 per share on revenues of $159 million.
John Jacobs, President and Chief Executive Officer, Novavax, stated “We are proud of the progress we made over the last quarter to deliver the only protein-based non-mRNA vaccine option in the U.S. and have worked to provide broad access across retail pharmacies and healthcare offices.”
Segment wise:
- Product sales plunged to $2.23 million from $626.09 million.
- Grants rose to $164.92 million from $106.27 million.
- Royalties and other revenues grew to $19.83 million from $2.21 million.
Looking ahead, the company now anticipates FY 2023 revenue in the range of $900 million to $1.10 billion, down from an earlier outlook of between $1.30 billion and $1.50 billion. The downward revision was made to adjust for the product’s (COVID-19 vaccine) sales period. Wall Street analysts anticipate the company to post revenues of $1.35 billion.
For 1Q 2024, Novavax projects revenues of $300 million.
In response to the dynamic challenges presented by the COVID-19 vaccine market, Novavax has proactively implemented a series of cost-cutting measures. As part of the restructuring plan unveiled in May, the company achieved a significant reduction in liabilities, amounting to $128 million in the third quarter alone.
The company is currently navigating concerns associated with the sustainability of its operations, specifically against the backdrop of declining demand for its core product, COVID-19 shots. Addressing these worries, Novavax has affirmed its readiness to initiate an additional cost reduction program. This program aims to further curb expenses, with a target of exceeding $300 million by the year 2024. The company intends to roll out an updated COVID-19 vaccine in preparation for the fall vaccination season of 2023.
Novavax ended the September quarter with cash of $666 million, a considerable increase from $518 million at the end of the previous (June) quarter.
The weak quarterly result is expected to keep the stock of Novavax range-bound with a slight bearish bias in the near term.
Technically, the stock of Novavax has broken the support level at $6.50. The next major support is anticipated to be only near $5. Additionally, the stock is trading below its 50-day moving average, while the Chaikin Money Flow indicator is showing a negative reading. Therefore, we anticipate Novavax stock to remain in a downtrend in the near term.
Disclaimer: Any financial trading analysis offered here is our opinion and is not intended as advice or direction for investors. We cannot guarantee the success of any trades made as a consequence of this article, and we encourage traders to incorporate a strong money management strategy to limit losses when they enter the markets. Please use this article as part of your own research before formulating strategies prior to trading.
