Volatile doesn't begin to describe how Moderna's (MRNA -8.05%) shares have been in 2021. The stock has experienced six swings of 25% or more so far this year. But the biotech's business has been headed in only one direction: up.

Investors learned just how much Moderna's business is booming when the company announced its first-quarter results before the market opened today. Here are the highlights from the biotech's update.

Healthcare provider holding a tray of vials labeled 'COVID-19 vaccine'

Image source: Getty Images.

By the numbers

Moderna reported revenue of $1.9 billion in the first quarter, compared to only $8 million in the prior-year period. Despite this huge increase, the result fell a little short of the average analyst estimate of $2.04 billion.

The company announced net income in the first quarter of $1.2 billion, or $2.84 per share, based on generally accepted accounting principles (GAAP) -- its first profitable quarter ever. In the prior-year period, Moderna posted a GAAP net loss of $124 million, or $0.35 per share. The consensus Wall Street estimate was for first-quarter earnings of $2.39 per share.

Moderna ended the quarter with cash, cash equivalents, and investments of $8.2 billion. This was a big increase from the $5.2 billion on hand as of Dec. 31, 2020.

Behind the numbers

There's no surprise as to what drove Moderna's tremendous revenue growth in the first quarter. Sales for the company's COVID-19 vaccine totaled $1.7 billion in its first full quarter on the market. This amount reflected 102 million doses sold during the quarter.

Moderna also received $190 million in grants from the Biomedical Advanced Research and Development Authority and $10 million in collaboration revenue in the first quarter. In the prior-year period, the company's grant and collaboration revenue totaled $8 million.

As expected, Moderna's costs also increased significantly. Research and development expenses nearly quadrupled year over year to $401 million. Selling, general, and administrative expenses more than tripled to $77 million. 

Looking ahead

Moderna plans to initiate a rolling submission this month for full Food and Drug Administration approval for its COVID-19 vaccine. It will also soon complete a phase 2/3 clinical study evaluating the vaccine in the 12-to-17 age group. The company is talking with regulators about potentially amending its current authorizations to include this age group. It's also conducting a phase 2 study of the vaccine in younger children ages 6 months to 11 years.

As of now, Moderna expects its COVID-19 vaccine to generate $19.2 billion in revenue this year (including first-quarter sales). This projection is based on advance purchase agreements already signed for 2021.

CEO Stephane Bancel said that supply deals for 2022 "should be higher than those in 2021." The increase could be dramatic: Moderna plans to triple its production capacity for next year to up to 3 billion doses. The company stated that it's in discussions about 2022 supply deals with all of the governments with which it already has deals in place. It's also talking with other governments in Asia, Latin America, and Africa that the company couldn't supply this year due to supply constraints.

Look for plenty of pipeline activity not related to the company's COVID-19 vaccine as well. Moderna expects to advance its cytomegalovirus (CMV) vaccine candidate mRNA-1647 into a pivotal late-stage study this year. It also plans to begin phase 1 studies for several candidates, including experimental flu vaccines, Epstein-Barr virus vaccine mRNA-1189, and HIV vaccines mRNA-1644 and mRNA-1574.

You might think that Moderna's shares would have soared with the company's great first-quarter update. That wasn't the case, though: The biotech stock sank more than 10% in early trading on Thursday. Why? Investors are worried about the potential impact if governments waive intellectual property protections for COVID-19 vaccines. The Biden administration is in favor of this move, which could cause sales to be lower for Moderna and other vaccine makers.