Novavax boosts 2025 revenue forecast to $1.05B amid Sanofi deal progress and cost cuts

Strategic Progress and Financial Highlights

John Charles Jacobs, President and CEO of Novavax, emphasized the company's strong performance during Q2 2025. He highlighted that the company continues to execute on its strategy to expand access to its proven technology platform by advancing R&D innovation and organically growing its portfolio. This includes strengthening existing partnerships while actively seeking new collaborations. A key focus was the partnership with Sanofi, which led to the approval of Nuvaxovid in the U.S., triggering a $175 million milestone payment to be received in the third quarter. The commercial activities for the U.S. market have been transitioned to Sanofi, with additional milestone payments anticipated for marketing authorization transfers and technology transfer, as well as potential royalties from combination vaccine development.

Jacobs also underscored the importance of enhancing existing partnerships, citing an updated collaboration with Takeda for the Japanese market, which significantly improved financial terms for Novavax. Takeda filed for approval of Nuvaxovid in June, aiming for approval and availability of doses in time for the fall season. Additionally, progress has been made with the Serum Institute of India and Oxford University on the R21 Matrix-M malaria vaccine, which has seen rollouts in 12 African countries and over 20 million doses sold since mid-2024.

The CEO further noted advancements in the strategic opportunities for the Matrix-M adjuvant, mentioning material transfer agreements with three pharmaceutical companies exploring its use in new indications, including oncology.

Positive Data from Phase III Trials

Ruxandra Draghia-Akli, Executive Vice President and Head of R&D, reported positive data from an initial Phase III cohort for the COVID-19 Influenza-Combination (CIC) and standalone flu vaccine candidates. Both vaccine candidates induced robust neutralizing antibody responses similar to licensed comparators.

James Patrick Kelly, CFO, stated that Novavax reported total revenue of $239 million for Q2 2025, compared to $415 million in the same period in 2024. He highlighted a 41% reduction in combined R&D and SG&A costs year-over-year and a 57% reduction in SG&A. The company ended the second quarter with over $850 million in cash and receivables, including the $175 million milestone payment from Sanofi.

Updated Revenue Framework and Financial Guidance

The company updated its full-year 2025 revenue framework and financial guidance to include the impact of the FDA post-marketing commitment study. Kelly stated that the revenue framework is now expected to achieve adjusted total revenue between $1 billion and $1.050 billion. The updated full-year 2025 financial guidance for combined R&D and SG&A expenses is now $495 million to $545 million, reflecting the addition of the PMC study. Management reaffirmed the target for non-GAAP profitability as early as 2027, supported by partner performance and cost discipline.

Financial Results Overview

Novavax reported total revenue of $239 million for Q2 2025, including a $175 million milestone from Sanofi. Product sales were $11 million, with $13 million from supply sales and negative $2 million from Nuvaxovid product sales due to closeout activities and return reserves. Licensing, royalties, and other revenue totaled $229 million, including $199 million from Sanofi and $27 million from Takeda. Combined R&D and SG&A expenses were $123 million, reflecting major cost reductions. The company reported net income of $107 million or $0.62 per diluted share. Year-to-date sales of the R21 Matrix-M malaria vaccine reached 14 million doses, surpassing the previous year.

Q&A Insights

Analysts raised questions about the 2025-2026 COVID season supply and approval filings for JN.1, as well as CIC and flu partnership timing. Kelly responded that filings focus on shelf-life improvements, aiming for a "more competitive profile, the expectation being 6 months, at least." Jacobs mentioned ongoing conversations with multiple potential partners regarding the combination vaccine but provided no specifics.

Other analysts inquired about CD4 T cell superiority data and the process for material transfer agreements (MTAs) leading to financial transactions. Draghia-Akli described the T cell data as "very encouraging," but noted annual strain variability. Jacobs explained that MTAs allow partners to evaluate Matrix-M and could lead to licensing deals, though specifics were not disclosed. Silvia Taylor addressed BARDA funding, stating that the company continues to work with BARDA on potential funding.

Analysts also asked about openness to acquiring or in-licensing clinical stage candidates. Jacobs stated the focus is on internal development and external partnering. Kelly added that the goal is to get Matrix-M into more partners' hands to drive innovation.

Sentiment and Market Outlook

Analysts pressed for specifics on partnership timelines, regulatory filings, and financial impacts, with a neutral to slightly positive tone. Management maintained a confident and disciplined tone in prepared remarks, focusing on strategic execution and cost controls. In Q&A, management was more measured and occasionally deflective, particularly regarding partnership discussions and future licensing transactions, using phrases like "we can't give detail or comment on that" and "there's not much more we can say on this until these deals materialize."

Compared to the previous quarter, management’s tone remains confident, with increased specificity around financial targets and partnership progress. Analysts appear increasingly interested in the cadence of partnerships and regulatory milestones.

Quarter-over-Quarter Comparison

The updated revenue guidance for 2025 is now $1 billion to $1.050 billion, up from the previous quarter’s $975 million to $1.025 billion framework. The company recorded a significant milestone payment of $175 million from Sanofi in Q2, whereas Q1 included $603 million related to the closeout of Canada and New Zealand APAs. Combined R&D and SG&A cost reductions accelerated to 41% in Q2 from 24% in Q1 year-over-year. There is a greater emphasis this quarter on operational efficiency and the contribution of partnerships to future profitability.

Risks and Concerns

The company highlighted the need for successful execution of the Sanofi partnership, regulatory milestones, and the outcomes of the post-marketing commitment study. Management noted that the costs of the PMC study are expected to be reimbursed by Sanofi, limiting impact on the 2025 and 2026 operating profit profile. Analyst concerns centered on partnership timelines, regulatory approval processes, and the evolving funding landscape for vaccine platforms.

Final Takeaway

Novavax’s management emphasized that the company is positioned for long-term value creation through its strategic focus on optimizing partnerships—especially with Sanofi and Takeda—driving operational efficiency, and advancing a streamlined pipeline. The raised revenue target for 2025 and ongoing cost reductions reflect a disciplined approach aimed at achieving non-GAAP profitability as early as 2027, with further value expected from milestone and royalty streams as new collaborations and pipeline developments advance.