Moderna, Inc.

5. Collaboration Agreements and Research and Development Funding Arrangement

Merck – Personalized mRNA Cancer Vaccines (Individualized Neoantigen Therapy)

In June 2016, we entered into a Collaboration and License Agreement for the development and commercialization of personalized mRNA cancer vaccines (also known as INT) with Merck & Co., Inc. (Merck). This agreement was subsequently amended and restated in 2018. Our role in this strategic alliance involves identifying genetic mutations in a particular patient’s tumor cells, synthesizing mRNA for these mutations, encapsulating the mRNA in one of our proprietary lipid nanoparticles (LNPs), and administering a unique mRNA INT to each patient. Each INT is designed to specifically activate the patient’s immune system against her or his own cancer cells. INT has recently been assigned the generic name intismeran autogene.

In September 2022, Merck exercised its option for INT, including mRNA-4157, pursuant to the terms of the agreement and in October 2022 paid us an option exercise fee of $250 million. Following this exercise, the Merck Participation Term commenced. Pursuant to the agreement, we and Merck have agreed to collaborate on development and potential commercialization of INT, with costs and any profits or losses generally shared equally on a worldwide basis, subject to certain exceptions as outlined in the agreement. We concluded that the collaboration arrangement under the Merck Participation Term is within the scope of ASC 808. For the three and six months ended June 30, 2025, we recognized expenses, net of Merck's reimbursements, of $99 million and $203 million, respectively, related to the INT collaboration under the Merck Participation Term. For the three and six months ended June 30, 2024 these expenses were $95 million and$171 million, respectively.

Additionally, for the three and six months ended June 30, 2025, the net cost recovery for capital expenditures was $6 million and $18 million, respectively. For the three and six months ended June 30, 2024, this amount was$33 million and$57 million, respectively. These amounts were applied to reduce the capitalized cost of the assets.

We have other collaborative and licensing arrangements that we do not consider to be individually significant to our business at this time. Pursuant to these agreements, we may be required to make upfront payments and payments upon achievement of various development, regulatory and commercial milestones, which in the aggregate could be significant. Future milestone payments, if any, will be reflected in our consolidated financial statements when the corresponding events have occurred. In addition, we may be required to pay significant royalties on future sales if products related to these arrangements are commercialized.

Development and Commercialization Funding Arrangement with Blackstone Life Sciences (Blackstone)

In March 2024, we entered into a development and commercialization funding arrangement with Blackstone, under which Blackstone has committed to providing up to $750 million in funding to us. This funding supports the development of our investigational mRNA-based influenza vaccine. Contingent upon regulatory approval in the U.S. and only if the approval is dependent on data from the funded activities, Blackstone will be entitled to receive low single-digit percentage royalties and up to $750 million in sales milestone payments. These payments are based on net sales of our future influenza and combination vaccines, with sales milestone payments contingent upon achieving specified cumulative net sales targets.

Given the substantive transfer of financial risk to Blackstone, we account for this arrangement as an obligation to conduct research and development activities. The funding is recognized as a reduction to the expenses of our mRNA-based influenza program. This reduction is recognized proportionally as the related costs are incurred, based on an input method. For the three and six months ended June 30, 2025, we recorded research and development expense reductions of $160 million and $250 million, respectively. We recorded immaterial research and development expense reductions during the three and six months ended June 30, 2024.

6. Financial Instruments

Cash and Cash Equivalents and Investments

The following tables summarize our cash, cash equivalents, and available-for-sale securities by significant investment category as of June 30, 2025 and December 31, 2024 (in millions):

The amortized cost and estimated fair value of available-for-sale securities by contractual maturity as of June 30, 2025 and December 31, 2024 were as follows (in millions):

In accordance with our investment policy, we place investments in investment grade securities with high credit quality issuers, and generally limit the amount of credit exposure to any one issuer. We evaluate securities for impairment at the end of each reporting period. Impairment is evaluated considering numerous factors, and their relative significance varies depending on the situation.

Factors considered include whether a decline in fair value below the amortized cost basis is due to credit-related factors or non-credit-related factors, the financial condition and near-term prospects of the issuer, and our intent and ability to hold the investment to allow for an anticipated recovery in fair value. Any impairment that is not credit related is recognized in other comprehensive loss, net of applicable taxes. A credit-related impairment is recognized as an allowance on the balance sheet with a corresponding adjustment to earnings. We didnot recognize any impairment charges related to available-for-sale securities for the three and six months ended June 30, 2025 and 2024. We didnot record any credit-related allowance for available-for-sale securities as of June 30, 2025 and December 31, 2024.

The following table summarizes the amount of gross unrealized losses and the estimated fair value for our available-for-sale securities in an unrealized loss position by the length of time the securities have been in an unrealized loss position as of June 30, 2025 and December 31, 2024 (in millions):

As of June 30, 2025 and December 31, 2024, we held 140 and 252 available-for-sale securities, respectively, out of our total investment portfolio that were in a continuous unrealized loss position. We neither intend to sell these investments, nor do we believe that we are more-likely-than-not to conclude we will have to sell them before recovery of their carrying values. We also believe that we will be able to collect both principal and interest amounts due to us at maturity.

Assets and Liabilities Measured at Fair Value on a Recurring Basis

The following fair value hierarchy is used to classify assets and liabilities based on the observable inputs and unobservable inputs used to value the assets and liabilities:

•Level 1: Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities;

•Level 2: Quoted prices for similar assets and liabilities in active markets, quoted prices in markets that are not active, or inputs which are observable, either directly or indirectly, for substantially the full term of the asset or liability; or

•Level 3: Prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable (i.e., supported by little or no market activity).

The following tables summarize our financial assets and liabilities measured at fair value on a recurring basis as of June 30, 2025 and December 31, 2024 (in millions):

(1)Investments in publicly traded equity securities with readily determinable fair values are recorded at quoted market prices for identical securities, with changes in fair value recorded in other income (expense), net, in our condensed consolidated statements of operations.

As of June 30, 2025 and December 31, 2024, we did not have non-financial assets or liabilities measured at fair value on a recurring basis and did not have any Level 3 financial assets or financial liabilities.

For the three and six months ended June 30, 2025, we didnot recognize a net gain and recognized a net loss of $8 million, respectively, on equity investments from changes in fair value of the securities. For the three and six months ended June 30, 2024, we recognized net losses of $22 million and $35 million, respectively, on equity investments from changes in fair value of the securities.

7. Inventory

Inventory as of June 30, 2025 and December 31, 2024 consisted of the following (in millions):

(1)Consisted of raw materials with an anticipated consumption beyond one year. Inventory, non-current is included in other non-current assets in the condensed consolidated balance sheets.

Inventory write-downs as a result of excess, obsolescence, scrap or other reasons, and losses on firm purchase commitments are recorded as a component of cost of sales in our condensed consolidated statements of operations. For the three and six months ended June 30, 2025, inventory write-downs were $38 million and $80 million, respectively. For the three and six months ended June 30, 2024, inventory write-downs were $14 million and $44 million, respectively. For the three and six months ended June 30, 2025, losses on firm purchase commitments were $7 million and $17 million, respectively. For the three and six months ended June 30, 2024, there wereno losses on firm purchase commitments. Inventory write-downs were mainly related to inventory in excess of expected demand and shelf-life expiration. Losses on firm purchase commitments were primarily related to excess raw material purchase commitments that will expire before the anticipated consumption of those raw materials. As of June 30, 2025 and December 31, 2024, the accrued liability for losses on firm future purchase commitments in our condensed consolidated balance sheets was $14 million and $60 million, respectively.

In May 2025, the FDA approved mNEXSPIKE (mRNA-1283), our next-generation COVID-19 vaccine, and we began to capitalize mRNA-1283 inventory. As of June 30, 2025 and December 31, 2024, we had inventory on hand of $367 million and $267 million, respectively, inclusive of inventory for our COVID and RSV vaccines. Our raw materials and work-in-progress inventory have variable shelf lives. We expect that the majority of this inventory will be consumed over the next three years. The shelf life of our original COVID vaccine, mRNA-1273, isnine totwelve months. Our next-generation COVID vaccine, mRNA-1283, has a shelf life of twelve months. The shelf life of our RSV vaccine iseighteen months.

8. Property, Plant and Equipment, Net

Property, plant and equipment, net, as of June 30, 2025 and December 31, 2024 consisted of the following (in millions):

Depreciation and amortization expense related to property, plant and equipment for the three and six months ended June 30, 2025 was $56 million and $94 million, respectively. Depreciation and amortization expense related to property, plant and equipment for the three and six months ended June 30, 2024 was $40 million and $75 million, respectively.

9. Other Balance Sheet Components

Accounts Receivable, net

Accounts receivable, net, as of June 30, 2025 and December 31, 2024 consisted of the following (in millions):

Prepaid Expenses and Other Current Assets

Prepaid expenses and other current assets, as of June 30, 2025 and December 31, 2024 consisted of the following (in millions):

Other Non-Current Assets

Other non-current assets, as of June 30, 2025 and December 31, 2024 consisted of the following (in millions):

(1)Consisted of raw materials with an anticipated consumption beyond one year.

Accrued Liabilities

Accrued liabilities, as of June 30, 2025 and December 31, 2024 consisted of the following (in millions):

(1)Related to losses that are expected to arise from firm, non-cancellable, commitments for future raw material purchases (Note 7).

Other Current Liabilities

Other current liabilities, as of June 30, 2025 and December 31, 2024 consisted of the following (in millions):

Other Non-Current Liabilities

Other non-current liabilities, as of June 30, 2025 and December 31, 2024 consisted of the following (in millions):

Deferred Revenue

The following table summarizes the activities in deferred revenue for thesix months ended June 30, 2025 (inmillions):

10. Leases

We have entered into various long-term, non-cancelable lease arrangements for our facilities and equipment, expiring at various times through 2039. Certain of these arrangements have free rent periods or escalating rent payment provisions. We recognize lease costs under such arrangements on a straight-line basis over the life of the lease. We lease various parcels of land, office, lab, and manufacturing spaces across the globe for our business operations.

We havetwo main campuses in Massachusetts, our Moderna Science Center (MSC), located in Cambridge, which serves as our headquarters, and our Moderna Technology Center (MTC), located in Norwood. The MSC, comprising approximately 462,000 square feet, includes our principal executive office and additional office and laboratory spaces. The MSC lease commenced in the third quarter of 2023 and has a term of 15 years, with options fortwo additional seven-year extensions. The MTC is a multiple-building campus spanning approximately 722,000 square feet. It includes laboratory and office space that directly supports our manufacturing operations as well as our commercial and clinical activities. The MTC was previously subject to long-term lease arrangements, and we completed the acquisition of the campus, including the underlying land and buildings, in December 2024.

Operating and financing lease right-of-use assets and lease liabilities as of June 30, 2025 and December 31, 2024 were as follows (in millions):

(1)These assets are real estate related assets, which include land, office, manufacturing, and laboratory spaces.

(2)Net of accumulated amortization.

(3)These assets are related to contract manufacturing service agreements.

(4)Included in property, plant and equipment in the condensed consolidated balance sheets, net of accumulated depreciation.

(5)Included in other current liabilities in the condensed consolidated balance sheets.

Future minimum lease payments under our non-cancelable lease agreements as of June 30, 2025, were as follows (in millions):

11. Commitments and Contingencies

Legal Proceedings

We are a party to various legal proceedings and claims. Accruals are recognized for legal matters when a loss is both probable and reasonably estimable. As of June 30, 2025, no material contingent liabilities have been recognized. If a material loss is reasonably possible and we can estimate the amount or range of the loss, we disclose such information. Unless otherwise noted, either the outcome of these matters is not expected to be material, or the potential loss cannot be reasonably estimated.

From time to time, we may be a party to litigation, arbitration, or other legal proceedings in the course of our business. The outcome of such matters is inherently uncertain and often involves significant judgment in assessing risk and estimating potential exposure. While we do not currently expect any pending proceedings to have a material adverse effect on our financial position, results of operations, or cash flows, there can be no assurance that future developments will not have a material impact.

The following summarizes our significant legal proceedings and matters outstanding as of June 30, 2025.

We have brought patent-infringement actions against Pfizer Inc. (Pfizer), BioNTech SE (BioNTech) and related entities in the U.S., Germany, the Netherlands, the UK, Ireland and Belgium concerning our mRNA platform technology and disease-specific vaccine designs. Pfizer and BioNTech have commenced actions or asserted defenses seeking to revoke our patents in these jurisdictions.

Alnylam Pharmaceuticals has filed three complaints against us in the U.S. District Court for the District of Delaware asserting U.S. patents concerning cationic lipids.

Arbutus Biopharma Corporation (Arbutus) and Genevant Sciences GmbH (Genevant) have brought patent-infringement actions against us in the U.S. District Court for the District of Delaware, as well as in Canada, Japan, Switzerland and the Unified Patent Court (UPC) asserting patents concerning lipid nanoparticles.

GlaxoSmithKline Biologicals SA (GSK) has filedtwo complaints against us in the U.S. District Court for the District of Delaware asserting certain patents owned by GSK. GSK has also filedtwo patent-infringement lawsuits against us in the UPC concerning liposomes and modified liposomes for RNA delivery.

Northwestern University has filed a complaint against us in the U.S. District Court for the District of Delaware asserting U.S. patents concerning lipid nanoparticle technology.

We are subject to shareholder class action and shareholder derivative litigation pending in the U.S. District Court for the District of Massachusetts related to statements about our RSV vaccine (mRNA-1345).

Indemnification Obligations

As permitted under Delaware law, we indemnify our officers, directors, and employees for certain events, occurrences while the officer, or director is, or was, serving at our request in such capacity. The term of the indemnification is for the officer’s or director’s lifetime.

We have standard indemnification arrangements in our leases for laboratory and office space that require us to indemnify the landlord against any liability for injury, loss, accident, or damage from any claims, actions, proceedings, or costs resulting from certain acts, breaches, violations, or non-performance under our leases.

We enter into indemnification provisions under our agreements with counterparties in the ordinary course of business, typically with business partners, contractors, clinical sites and customers. Under these provisions, we generally indemnify and hold harmless the indemnified party for losses suffered or incurred by the indemnified party as a result of our activities. These indemnification provisions generally survive termination of the underlying agreement. The maximum potential amount of future payments we could be required to make under these indemnification provisions is unlimited.

Through the three and six months ended June 30, 2025 and the year ended December 31, 2024, we hadnot experienced any material losses related to these indemnification obligations, andno material claims were outstanding. We do not expect significant claims related to these indemnification obligations and, consequently, concluded that the fair value of these obligations is negligible, andno related reserves were established.

Purchase Commitments and Purchase Orders

We enter into agreements in the normal course of business with vendors and contract manufacturing organizations for raw materials and manufacturing services and with vendors for preclinical research studies, clinical trials and other goods or services. As of June 30, 2025, we had $427 million of non-cancelable purchase commitments related to raw materials and manufacturing agreements, which are expected to be paid through 2027. As of June 30, 2025, we had $156 million of non-cancelable purchase commitments related to research and development and other goods and services which are expected to be paid through 2028. These amounts represent our minimum contractual obligations, including termination fees.

In addition to purchase commitments, we have agreements with third parties for various goods and services, including services related to clinical operations and support and contract manufacturing, for which we are not contractually able to terminate for convenience and avoid any and all future obligations to the vendors. Certain agreements provide for termination rights subject to termination fees or wind-down costs. Under such agreements, we are contractually obligated to make certain payments to vendors, mainly, to reimburse them for their unrecoverable outlays incurred prior to cancellation. As of June 30, 2025, we had cancelable open purchase orders of $2.2 billion in total under such agreements for our significant clinical operations and support and contract manufacturing. These amounts represent only our estimate of those items for which we had a contractual commitment to pay as of June 30, 2025, assuming we would not cancel these agreements. The actual amounts we pay in the future to the vendors under such agreements may differ from the purchase order amounts.

Licenses to Patented Technology

We have patent license agreements with Cellscript, LLC and its affiliate, mRNA RiboTherapeutics, Inc., and the National Institute of Allergy and Infectious Diseases (NIAID), an Institute of the National Institutes of Health (NIH). Under these agreements, we are required to pay royalties and certain milestone payments. For further information on our licensing and royalty payments, please refer to our 2024 Form 10-K under the heading “Business—Intellectual Property—In-licensed intellectual property” and Note 11 to our consolidated financial statements contained therein.

In January 2025, we entered into a non-exclusive patent license agreement with NIAID to license certain patent rights related to the development of mRNA-based vaccines for the prevention or treatment of respiratory syncytial virus (RSV) infection. Upon execution of the agreement, we made a total payment of $10 million, which was capitalized as an intangible asset and is amortized to cost of sales on a straight-line basis over the estimated useful life of the licensed patents. In addition, we are obligated to pay low single-digit royalties on future net sales of licensed products.

For the three and six months ended June 30, 2025, we recognized $6 million and $11 million, respectively, of royalty expenses associated with our product sales. For the three and six months ended June 30, 2024, we recognized $10 million and $18 million, respectively, of royalty expenses associated with our product sales. These royalty expenses were recorded to cost of sales in our condensed consolidated statements of operations.

Additionally, we have other in-license agreements with third parties which require us to make future development, regulatory and commercial milestone payments and sales-based royalties for specified products associated with the agreements. The achievement of these milestones have not yet occurred as of June 30, 2025.

12. Stock-Based Compensation and Share Repurchase Programs

Stock-Based Compensation

The following table presents the components and classification of stock-based compensation expense for the three and six months ended June 30, 2025 and 2024 as follows (in millions):

As of June 30, 2025, there was $908 million of total unrecognized compensation cost related to unvested stock-based compensation with respect to options, RSUs and PSUs granted. That cost is expected to be recognized over a weighted-average period of 2.1 years as of June 30, 2025.

Effective in the first quarter of 2025, we revised the assumptions used in the Black-Scholes option pricing model for estimating the grant date fair value of stock options. The expected term is estimated using a methodology that combines historical settlement data with a hypothetical settlement pattern for outstanding options, based on estimated time to arrive at-the-money and adjusted for employee departure rates. We also revised our approach for estimating expected volatility by removing peer company data and using a blended measure of our own historical and implied volatility. These updates reflect the increased availability of company-specific data and did not have a material impact on stock-based compensation and our financial statements.

Share Repurchase Programs

As of June 30, 2025, $1.7 billion of our Board of Directors’ authorization for repurchases of our common stock (the 2022 Repurchase Programs) remains outstanding, with no expiration date. There wereno shares repurchased during the three and six months ended June 30, 2025 or 2024.

13. Income Taxes

The following table summarizes our income tax expense for the periods presented (in millions, except for percentages):

The effective tax rate for the three and six months ended June 30, 2025 was higher than the statutory rate, primarily due to our global valuation allowance, which limits our ability to recognize tax benefits from the loss. The higher effective tax rate was also impacted by certain of our foreign subsidiaries that have taxable income, while we incurred a net loss before income taxes in other jurisdictions. The effective tax rate for the three and six months ended June 30, 2025 was consistent with the same period in 2024, primarily due to the continued maintenance of global valuation allowance. For additional details regarding our deferred tax assets and the policies governing our valuation allowance, please refer to Note 13 to our consolidated financial statements in our 2024 Form 10-K.

We periodically reassess the need for valuation allowances on our deferred tax assets, considering both positive and negative evidence to evaluate whether it is more likely than not that all or a portion of such assets will not be realized. Significant management judgment is required in assessing the realizability of our deferred tax assets. In the event that actual results differ from our estimates, we adjust our estimates in future periods and we may need to modify our valuation allowance, which could materially impact our financial position and results of operations.

We file U.S. federal income tax returns and income tax returns in various state, local and foreign jurisdictions. As of June 30, 2025, we are under audit in various state and foreign jurisdictions; however, no adjustments to our tax positions have been proposed at this time.

14. Loss per Share

The computation of basic earnings (loss) per share (EPS) is based on the weighted-average number of our common shares outstanding. The computation of diluted EPS is based on the weighted-average number of our common shares outstanding and potential dilutive common shares during the period as determined by using the treasury stock method.

Basic and diluted EPS for the three and six months ended June 30, 2025 and 2024 were calculated as follows (in millions, except per share data):