Moderna Inc. (NASDAQ:MRNA)

Current Income Tax Expense

The current income tax expense experienced a significant increase from US$1 million in 2019 to US$3 million in 2020, followed by an exponential rise to US$1,379 million in 2021 and further to US$1,791 million in 2022. However, in 2023, there was a notable reversal resulting in a negative value of US$129 million, indicating a possible tax refund or adjustment.

Deferred Income Tax Expense

The deferred income tax expense began at negative US$1 million in 2019, was absent (zero or missing) in 2020, and then shifted to a substantial deferred tax benefit of US$296 million in 2021. This benefit deepened further to US$578 million in 2022. Contrastingly, in 2023, the deferred tax expense reverted to a significant cost of US$901 million, suggesting changes in deferred tax assets or liabilities impacting the reported tax expense.

Provision for Income Taxes

The overall provision for income taxes mirrored the upward trend in current tax expense from a negative US$1 million in 2019 to US$3 million in 2020, sharply increasing to US$1,083 million in 2021 and continuing to rise to US$1,213 million in 2022. In 2023, the provision decreased to US$772 million, reflecting the combined effect of the unusual decrease in current tax expense and the reversal in deferred tax expense.

Summary of Trends and Insights

There is a clear pattern of rapidly increasing income tax expenses from 2019 through 2022, driven primarily by the current income tax expense. The deferred tax expense initially acted as a tax benefit, reducing overall tax costs notably during 2021 and 2022. However, in 2023, both the current and deferred components moved in directions that decreased the overall provision for income taxes compared to prior years, with the current tax expense turning negative and the deferred tax shifting to a significant expense. These fluctuations may be linked to changes in taxable income, tax credits, or adjustments in temporary differences affecting deferred taxes. The sharp rise and subsequent decline in tax expenses imply potential volatility in taxable income or tax treatments during the analyzed periods.

The financial data reveals several notable trends in the tax-related metrics over the analyzed period.

Federal Statutory Tax Rate

This rate remained constant at 21% throughout the entire period, indicating stability in the base federal tax environment affecting the company.

Change in Valuation Allowance

The change in valuation allowance showed considerable fluctuations. It was highly negative in 2019 and 2020 (-33% and -47.4%, respectively), decreased sharply in 2021 to -5.4%, was missing in 2022, and then returned to a highly negative value of -52.6% in 2023. This indicates volatility in tax asset valuation assumptions or realizability assessments during these years.

Foreign-Derived Intangible Income

This component fluctuated significantly, starting with a minor negative value (-0.2%) in 2019, then missing in 2020, followed by increasingly negative values in 2021 (-4.8%) and 2022 (-7.4%), before swinging to a slight positive (0.2%) in 2023. This trend implies changing impacts of foreign-derived income on the company’s tax position, with a negative effect in most years except the latest.

Stock-Based Compensation Windfall

The stock-based compensation adjustment was not recorded in 2019, peaked at a positive 19.8% in 2020, then declined to negative values in 2021 (-2.6%) and 2022 (-1.6%), before slightly increasing to 2.4% in 2023. This variability suggests shifts in stock-based compensation expense treatment and its tax implications over time.

Federal Research and Development Credits

These credits trended upward in the early years (2.5% in 2019 and 3.8% in 2020) but turned negative in 2021 (-0.7%) and 2022 (-0.5%) before rising sharply again to 4.6% in 2023. This pattern could reflect changing levels of qualifying research activity or adjustments in credit recognition.

State Taxes, Net of Federal Benefits

State tax impacts decreased substantially from 7.9% in 2019 to 3.6% in 2020, followed by minimal effects in 2021 (0.5%) and 2022 (0.4%), and then increased notably to 5.7% in 2023. This variation denoted fluctuating state tax burden net of federal benefit over the period.

Non-Deductible Items

This category started at 1.6% in 2019, turned negative at -0.8% in 2020, was missing in 2021 and 2022, and recorded a small negative value of -0.4% in 2023, indicating marginal but inconsistent impact of non-deductible expenses on the tax rate.

Other

Other items remained relatively minor and generally close to zero with slight fluctuations: from 0.2% in 2019 to -0.3% in 2020, positive 0.1% in 2021, increasing modestly to 0.8% in 2022, and then dropping to -0.5% in 2023.

Effective Tax Rate

Data is missing for 2019. The effective tax rate was slightly negative in 2020 (-0.3%), increased significantly in 2021 (8.1%) and further in 2022 (12.7%), before reversing sharply to a negative rate of -19.6% in 2023. This pronounced volatility suggests major shifts in tax expense recognition or adjustments affecting the overall tax burden in the latest year.

Net operating loss carryforwards

The net operating loss carryforwards increased significantly from $268 million in 2019 to a peak of $587 million in 2020, followed by a sharp decline to $69 million in 2021 and further reductions in 2022 and 2023, reaching $90 million. This suggests a utilization or expiration of prior losses after 2020.

Stock-based compensation

Stock-based compensation showed moderate fluctuations, decreasing from $44 million in 2019 to $33 million in 2020, then rebounding to $44 million in 2021. Substantial increases occurred in subsequent years, with $68 million in 2022 and a significant jump to $111 million in 2023, indicating expanding employee compensation expenses possibly linked to growth or retention strategies.

Capitalized licenses, research and development, and start-up costs

There was a strong upward trajectory in this category, rising from $20 million in 2019 to $14 million in 2020, then surging to $204 million in 2021. This growth accelerated further to $704 million in 2022 and $1,449 million in 2023, highlighting increasing investments in intellectual property, R&D, and new initiatives over the period.

Tax credit carryforwards

Tax credit carryforwards demonstrated modest variability, rising from $77 million in 2019 to $99 million in 2020, followed by a decline to $80 million in 2021. It picked up again in 2022 to $97 million and grew further to $140 million in 2023, reflecting changing utilization or accrual of tax credits.

Operating lease liabilities

Operating lease liabilities fluctuated between $22 million and $32 million from 2019 through 2022 but increased sharply to $154 million in 2023. This sharp increase may correspond to new or expanded lease agreements or accounting changes.

Financing lease liabilities

Financing lease liabilities rose steadily over the years, from $11 million in 2019 to $24 million in 2020, then jumped markedly to $136 million in 2021. The values remained relatively stable at $135 million in 2022 and $139 million in 2023, suggesting a stabilization of financing lease obligations after significant expansion.

Other comprehensive income

Data is only available for 2022 and 2023, with $106 million recorded in 2022 followed by a decrease to $34 million in 2023. The fluctuating figures indicate variability in unrealized gains or losses during this period.

Inventory reserve and capitalization

Values appeared starting in 2022 with $86 million and increased substantially to $250 million in 2023, indicating rising adjustments or capitalizations related to inventory management.

Wholesaler chargebacks, discounts, and fees

This item is reported only in 2023 at $92 million, pointing to emerging or newly recognized expense components related to sales allowances.

Returns and other fees

Similarly, returns and other fees are recorded only in 2023 at $129 million, which may reflect growing considerations for product returns and related costs.

Other (various)

Values changed from $61 million in 2019 to a peak of $110 million in 2021 before decreasing to $85 million in 2022 and slightly increasing to $90 million in 2023. An additional category labeled "Other" showed negligible negative values from 2020 through 2022, escalating to -$15 million in 2023, indicating some minor but increasing adjustments or losses in other areas.

Deferred tax assets, gross

The gross deferred tax assets increased dramatically from $507 million in 2019 to $874 million in 2020, then decreased to $675 million in 2021 before climbing to $1,366 million in 2022 and reaching $2,678 million in 2023. This sharp upward trend in the last two years suggests recognition of substantial future tax benefits.

Valuation allowance

The valuation allowance started at -$471 million in 2019, deepened to -$823 million in 2020, and then was substantially reduced to -$149 million in 2021 and -$155 million in 2022. However, a large increase to -$2,224 million occurred in 2023, which may indicate reassessment of the realizability of deferred tax assets resulting in a significant increase in the allowance.

Deferred tax assets, net of valuation allowance

This net figure rose steadily from $37 million in 2019 to $51 million in 2020, then experienced a substantial increase to $526 million in 2021 and $1,211 million in 2022, followed by a decline to $454 million in 2023. The pattern reflects growing deferred tax benefits partially offset by rising valuation allowances in the latest year.

Right-of-use assets, financing

These assets recorded increasing negative values from -$3 million in 2019 to -$12 million in 2020, sharply deepening to -$119 million in 2021 and maintaining a similar level through 2022 and 2023. The negative amounts point to lease accounting impacts on asset recognition related to financing leases.

Right-of-use assets, operating

Operating right-of-use assets remained relatively consistent from -$25 million in 2019 to -$20 million in 2020, then fluctuated around -$31 million to -$26 million in 2021 and 2022, respectively, before a sharp increase in negative value to -$160 million in 2023. This change suggests a significant increase in operating lease-related assets reflected as negative balances.

Property, plant, and equipment

Property, plant, and equipment showed a progressively increasing negative balance from -$9 million in 2019 to -$18 million in 2020, -$49 million in 2021, -$85 million in 2022, and -$107 million in 2023, indicating ongoing accumulation of asset costs or potentially increasing depreciation or impairments.

Deferred tax liabilities

Deferred tax liabilities increased consistently in absolute negative terms from -$37 million in 2019 to -$388 million in 2023, reflecting growing future tax obligations.

Net deferred tax assets (liabilities)

The net deferred tax assets/liabilities detail is unavailable for 2019 and 2020 but shows a positive and increasing trend with $326 million in 2021, $982 million in 2022, before declining sharply to $66 million in 2023. This suggests the net deferred tax position improved substantially through 2022 but experienced a contraction in 2023.

The analysis of the available tax-related financial data over the last five years reveals notable variations in the company's deferred tax assets and liabilities.

Deferred Tax Assets

Deferred tax assets were not reported or available for the years ending 2019 and 2020. Starting in 2021, a significant amount of $326 million was recognized, which then increased substantially to $982 million in 2022. However, in 2023, there was a marked decrease, with deferred tax assets dropping sharply to $81 million. This pattern indicates a considerable fluctuation in deferred tax assets, with a peak in 2022 followed by a steep decline in the subsequent year.

Deferred Tax Liabilities

Deferred tax liabilities were not recorded or disclosed from 2019 through 2022. In 2023, a small deferred tax liability of $15 million appeared on the books, indicating the emergence of obligations that were previously absent or insignificant. This suggests a change in the company's tax position or accounting recognition standards during the period.

Overall, the data points to a period of significant tax asset recognition starting in 2021, reaching its zenith in 2022, and then substantially decreasing the following year. Meanwhile, the company began recognizing deferred tax liabilities only in 2023. These shifts may reflect changes in the company's earnings, tax planning strategies, or accounting treatments related to temporary differences impacting taxable income over time.

The data reveals significant fluctuations in the financial position and performance over the reported periods, reflecting dynamic operational and market conditions.

Total Assets

Reported total assets exhibited substantial growth from 2019 to 2021, increasing from US$1,589 million to US$24,669 million, before peaking slightly in 2022 at US$25,858 million and then declining to US$18,426 million in 2023. Adjusted total assets follow a very similar pattern, with minor downward adjustments in 2021 through 2023, particularly evident in 2023 where adjusted total assets are US$18,345 million versus the reported US$18,426 million. This pattern suggests asset valuation changes or reclassifications impacting the adjusted figures.

Total Liabilities

Liabilities increased sharply from US$415 million in 2019 to a peak of US$10,524 million in 2021, followed by a notable reduction in 2022 to US$6,735 million and a further decrease in 2023 to US$4,572 million. Adjusted liabilities closely mirror the reported figures, with a slight adjustment downwards in 2023 to US$4,557 million from US$4,572 million reported, indicating limited deferred tax or reconciliation effects on liability values in recent periods.

Stockholders’ Equity

Equity saw strong growth from US$1,175 million in 2019 to US$14,145 million in 2021, continuing to rise to US$19,123 million in 2022 before declining to US$13,854 million in 2023. Adjusted equity consistently tracks slightly below reported equity, mainly due to deferred tax-related adjustments, with the gap becoming more pronounced in 2022 and 2023. This trend indicates capital accumulation through retained earnings or capital raises up to 2022, followed by a contraction in 2023.

Net Income (Loss)

Reported net income experienced a negative performance in 2019 and 2020, with losses of US$514 million and US$747 million respectively. In 2021, there was a dramatic turnaround with a reported net income of US$12,202 million, which slightly decreased to US$8,362 million in 2022, followed by a significant loss of US$4,714 million in 2023. Adjusted net income trends mirror these results, though consistently showing somewhat lower profitability in positive years and a less severe loss in 2023 (US$3,813 million loss). This volatility suggests extraordinary income events or changes impacting deferred tax liabilities and asset valuations.

Net Profit Margin

Both reported and adjusted net profit margins show extreme volatility over the analyzed periods. In 2020, the company experienced heavy losses with margins near -374%, followed by a sharp positive rebound in 2021 with margins above 40%. However, this recovery was not sustained, as margins decreased notably in 2022 and turned negative again in 2023, reaching -71% reported and -57% adjusted. The adjusted margins closely track the reported ones, indicating that deferred income tax adjustments have a limited impact on the overall profitability trend.

Total Asset Turnover

The total asset turnover started at a minimal level of 0.03 in 2020 and significantly increased in 2021 and 2022, reaching approximately 0.72-0.74. This rise suggests improved efficiency in generating revenue from assets during these years. However, in 2023, the turnover dropped back to 0.36, indicating a decline in asset utilization efficiency. Adjusted and reported values remain nearly identical, reflecting minimal deferred tax influence.

Financial Leverage

Financial leverage fluctuated over the periods, starting at 1.35 in 2019, peaking at 2.86 in 2020, and then declining steadily to near 1.33 in 2023. This trend suggests an initial increase in debt relative to equity or asset base in 2020, followed by a deleveraging phase in subsequent years. The closeness of reported and adjusted leverage ratios shows that deferred taxes do not significantly affect leverage assessment.

Return on Equity (ROE)

ROE exhibits a pattern similar to net profit margin, with substantially negative returns in 2019 and 2020, a pronounced positive spike in 2021 exceeding 85%, and a subsequent decline in 2022 and 2023, where it turned negative again. The adjusted ROE values are slightly lower than the reported ones in 2023, indicating some effect of deferred taxes on equity returns but following the same directional trend.

Return on Assets (ROA)

ROA follows a consistent trajectory with ROE and net profit margins, registering negative returns in 2019 and 2020, a sharp rebound in 2021 and 2022, and a decrease into negative territory in 2023. Adjusted ROA values are marginally lower than reported values in the last period. Overall, ROA improvements from 2020 to 2022 indicate better operating performance and asset use, but the decline in 2023 suggests deteriorating profitability or asset inefficiency.

Reported Net Income (Loss)

The company reported significant losses in 2019 and 2020, with net losses of approximately -$514 million and -$747 million respectively. In 2021, there was a substantial positive turnaround, recording a net income of $12,202 million. However, the following years saw a decline; 2022 reported reduced net income of $8,362 million, and 2023 returned to a loss position of -$4,714 million.

Adjusted Net Income (Loss)

The adjusted net income data follows a similar pattern to the reported net income. Losses were recorded in 2019 and 2020 at nearly the same levels as reported values (-$515 million and -$747 million). In 2021, adjusted net income was slightly lower than reported but still very strong at $11,906 million. Subsequently, adjusted net income decreased to $7,784 million in 2022 and reverted to a loss of -$3,813 million in 2023, mirroring the downward trend in reported figures.

Reported Net Profit Margin

The reported net profit margin exhibits extreme volatility. It shifted from a negative margin of approximately -373.77% in 2020 to a robust positive margin of 69.04% in 2021. This margin then declined to 45.36% in 2022, followed by a steep drop back into negative territory at -70.66% in 2023, indicating significant fluctuations in profitability relative to revenues.

Adjusted Net Profit Margin

The adjusted net profit margin trends closely mirror the reported margins but are consistently slightly lower. Starting from the same negative margin of -373.77% in 2020, the margin increased to 67.36% in 2021 before decreasing to 42.22% in 2022. In 2023, the margin also turned negative at -57.16%, consistent with the adjusted net loss for the period.

The financial data reveals notable fluctuations and trends in both the reported and adjusted total assets alongside their respective asset turnover ratios over the five-year period.

Total Assets

The reported total assets exhibit a substantial increase from 1,589 million US dollars in 2019 to a peak of 25,858 million US dollars in 2022, followed by a significant decline to 18,426 million US dollars in 2023. The adjusted total assets follow a similar trajectory, rising sharply from 1,589 million US dollars in 2019 to 24,876 million in 2022, then decreasing to 18,345 million in 2023. The close alignment between reported and adjusted figures suggests that adjustments for deferred and annual income tax do not materially impact the asset base.

Total Asset Turnover

The reported total asset turnover ratio started off at a very low level of 0.03 in 2020, then experienced a dramatic increase to approximately 0.72-0.74 in 2021 and 2022, before declining to 0.36 in 2023. The adjusted total asset turnover mirrors these movements closely. These patterns indicate that asset utilization efficiency significantly improved between 2020 and 2022, subsequently weakening in 2023, but still remaining notably higher than the initial period.

Insights

During the early years, the company held relatively low assets with minimal turnover. The rapid asset growth from 2020 to 2022 coincided with improved turnover ratios, reflecting enhanced operational efficiency or revenue generation relative to asset base expansion. However, the pronounced decline in asset size in 2023, combined with the halving of turnover ratio from 2022 levels, suggests a period of asset reduction with less efficient use of the remaining asset base. The consistent proximity of adjusted values to reported figures throughout the period implies minimal distortion from tax-related adjustments on these metrics.

The data reveals several notable trends in the financial position of the company over the five-year period examined.

Total Assets

Reported total assets showed substantial growth from 2019 through 2021, increasing from US$1,589 million to US$24,669 million. This marked expansion was followed by a moderate rise in 2022 and a significant decline in 2023, ending at US$18,426 million. Adjusted total assets follow a similar pattern, consistently slightly lower than reported figures, peaking at US$24,343 million in 2021 and declining to US$18,345 million in 2023.

Stockholders’ Equity

Reported stockholders’ equity experienced a pronounced increase, moving from US$1,175 million in 2019 to a peak of US$19,123 million in 2022. However, this was followed by a considerable decrease in 2023 to US$13,854 million. Adjusted equity values mirror the reported numbers closely, with the adjustment becoming more pronounced during peak years (2021 and 2022), indicating the impact of deferred income tax adjustments on equity during periods of rapid growth and contraction.

Financial Leverage

Both reported and adjusted financial leverage ratios increased significantly in 2020 to approximately 2.86, indicating a marked rise in the use of debt relative to equity. This ratio then decreased steadily over the following years, reaching approximately 1.33 by 2023, close to the 2019 level. The minor differences between reported and adjusted leverage suggest deferred taxes have minimal impact on leverage calculations.

Overall, the company experienced rapid asset and equity growth primarily during 2020 and 2021, followed by a stabilization and decline in 2023. The leverage pattern shows a peak in 2020, potentially reflecting increased financing activities or operational scaling during that period, with subsequent deleveraging. Adjusted figures consistently parallel reported values, with modest differences that refine the financial position by incorporating deferred tax effects.

The financial data demonstrates significant fluctuations in net income, stockholders' equity, and return on equity (ROE) over the five-year period. The data reveals both reported and adjusted figures, reflecting the impact of deferred income tax adjustments on the financial metrics.

Net Income (Loss)

The company experienced negative net income in 2019 and 2020, with losses deepening from -$514 million to -$747 million. A dramatic turnaround occurred in 2021, with net income soaring to $12,202 million (reported) and $11,906 million (adjusted). The following year, net income remained positive but declined substantially to $8,362 million (reported) and $7,784 million (adjusted). In 2023, net income reverted to negative territory, with reported losses of -$4,714 million and adjusted losses of -$3,813 million, indicating significant volatility and a sharp deterioration from the prior two years of profitability.

Stockholders’ Equity

The reported stockholders' equity displayed consistent growth from 2019 through 2022, increasing from $1,175 million to a peak of $19,123 million. However, in 2023 there was a notable decline to $13,854 million. Adjusted stockholders’ equity follows a similar pattern, rising steadily from $1,175 million in 2019 to $18,141 million in 2022 before decreasing to $13,788 million in 2023. The adjustments have a modest dampening effect on equity values, particularly in the later years.

Return on Equity (ROE)

Return on equity values correspond with the volatility observed in net income. Both reported and adjusted ROE were significantly negative in 2019 and 2020, reflecting poor profitability relative to equity. In 2021, ROE surged dramatically to over 86%, indicating exceptional earnings performance relative to equity. This was followed by a considerable decline in 2022, although ROE remained positive at around 43%. In 2023, ROE again turned negative, reaching -34.03% reported and -27.65% adjusted, signaling a return to losses impacting shareholder returns. The minor discrepancies between reported and adjusted ROE reflect the tax-related adjustments without altering the overall trend.

Overall, the data reveals a pronounced earnings turnaround starting in 2021 after two consecutive years of losses, accompanied by strong growth in equity and ROE. However, 2023 marked a reversal with significant losses and declines in shareholder equity and profitability ratios. The adjustments for deferred income taxes tend to marginally reduce income and equity figures but do not materially change the directional trends observed in reported results. This pattern emphasizes the company’s exposure to considerable financial volatility during the period under review.

Net Income (Loss) Trends

The reported net income experienced a significant negative position in 2019 and 2020, with losses of $514 million and $747 million respectively. In 2021, there was a remarkable rebound to a substantial profit of $12,202 million, which then decreased to $8,362 million in 2022. By 2023, the company returned to a loss of $4,714 million. The adjusted net income pattern follows a similar trajectory, with minor differences in magnitude, indicating consistent adjustments related to reported figures but no substantial deviation in overall trends.

Total Assets Trends

Reported total assets showed rapid growth from $1,589 million in 2019 to $7,337 million in 2020, reaching a peak of $24,669 million in 2021, then slightly increasing to $25,858 million in 2022 before declining to $18,426 million in 2023. Adjusted total assets closely mirror this pattern, with slight differences likely due to accounting adjustments. The asset base expanded significantly through 2021 and 2022 but contracted notably in the final reported year.

Return on Assets (ROA) Trends

Both reported and adjusted ROA values were negative in 2019 and 2020, reflecting losses relative to assets in these periods. There was a sharp recovery in 2021 with ROA approaching 49.46% reported and 48.91% adjusted, indicating significant profitability relative to asset size. In 2022, ROA decreased but remained positive, at 32.34% reported and 31.29% adjusted. By 2023, ROA turned negative again, with reported at -25.58% and adjusted at -20.78%, consistent with the return to net losses and reduction in total assets.

General Observations

The data reveals a volatile profitability environment, with a marked turnaround from losses to significant profits in 2021 and 2022, followed by a reversal to losses in 2023. Asset growth supported the profitability surge but contracted alongside the decline in earnings in the last period. The close alignment between reported and adjusted figures suggests accounting adjustments had a limited impact on the overall financial trends and performance analysis.