Moderna is reducing its global workforce by around 10% by the end of 2025 as demand for Covid-19 vaccines continues to weaken.
The company, which had about 5,800 full-time employees across 18 countries as of 31 December 2024, expects to have fewer than 5,000 workers by year-end.
The cuts come amid a broader restructuring effort aimed at aligning operating costs with reduced vaccine revenues, which have fallen short of Wall Street’s expectations this year.
The biopharmaceutical firm will issue a full business update when it releases its quarterly results on Friday morning. Investors are watching closely for any signs of recovery in Covid-related revenues or details on pipeline expansion.
$1.5 billion in cost reductions targeted by 2027
In May, Moderna announced plans to reduce its annual operating expenses by approximately $1.5 billion by 2027. This move builds on earlier cost-cutting measures and includes changes across research and development, manufacturing, and supplier agreements.
The company is scaling back its investment in respiratory product trials, renegotiating supplier deals, and lowering production costs to streamline operations.
Despite these cuts, Moderna CEO Stephane Bancel said in a memo to employees that the company remains committed to scientific innovation and long-term growth.
He noted that the restructuring is crucial for maintaining financial discipline and positioning Moderna to expand its product pipeline over the next three years, especially as pandemic-era revenue declines.
Covid vaccine sales disappoint in Q1 earnings
Moderna shares have fallen more than 20% so far this year, largely due to disappointing first-quarter vaccine sales that missed analyst projections.
The sales dip reflects a global decline in Covid-19 vaccine uptake, a trend affecting multiple pharmaceutical firms as governments scale back emergency pandemic programmes and shift to long-term healthcare strategies.
Moderna’s third Covid shot — a next-generation version — was approved by the US Food and Drug Administration in May, marking its third approved product.
However, sales of the vaccine have not been strong enough to offset the drop in demand seen across its Covid-related offerings.
Regulatory uncertainty under new US health secretary
The company also faces policy challenges in the United States under Health and Human Services Secretary Robert F. Kennedy Jr., who has introduced changes to vaccine guidelines.
These regulatory moves could further complicate access to vaccines in the US and pose additional hurdles for companies like Moderna seeking stable distribution channels.
While Bancel acknowledged the job losses were a difficult but necessary decision, he reaffirmed confidence in Moderna’s future. The company sees potential for up to eight new products over the next three years, a strategy that may help diversify revenue streams beyond Covid-19.
Moderna’s current strategy focuses on reshaping its operations to match market realities, as it attempts to transition from a pandemic-driven business model to one with a more sustainable product mix across the respiratory and infectious disease segments.
Its success will depend on maintaining innovation while navigating policy, competition, and evolving healthcare priorities.
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