SAN DIEGO--(BUSINESS WIRE)--
DexCom, Inc. (Nasdaq: DXCM) today reported its unaudited financial results as of and for the quarter ended June 30, 2017.
Second Quarter 2017 Highlights:
- Revenue grew 24% over the second quarter of 2016 to $170.6 million
- International revenue grew 69% over the second quarter of 2016
- Gross profit of $117.5 million or 69% of revenue
- GAAP net income of $2.9 million, or $0.03 per share
- Non-GAAP net loss of $14.2 million, or $0.16 per share
“The first half of 2017 has been very positive for DexCom. Our revenue increased 23% for the first six months of the year, and we remain on track to achieve our full year targets,” said Kevin Sayer, President and CEO, DexCom. “New patient interest in DexCom CGM is robust, fueled by positive reimbursement decisions for both the Medicare population and in Germany combined with increased awareness around the world. We believe DexCom CGM should be the first tool prescribed for people with diabetes and continue to invest in our pipeline to capitalize on the tremendous opportunity we see through the end of 2017 and beyond.”
Second Quarter Financial Summary:
Revenue grew to $170.6 million for the second quarter of 2017, an increase of 24% from the $137.3 million in revenue for the same quarter in 2016. Gross profit totaled $117.5 million or 69% for the second quarter of 2017 compared to a gross profit of $85.5 million or 62% for the same quarter of 2016.
The GAAP net income of $2.9 million, or $0.03 per share, for the second quarter of 2017 included $19.9 million in net non-cash expenses, compared to the GAAP net loss of $20.2 million, or $0.24 per share, for the same quarter in 2016, which included $31.5 million in non-cash expenses. Non-cash expenses for the second quarter of 2017 of $37.0 million were comprised primarily of share-based compensation, depreciation and amortization, and non-cash interest expense related to our senior convertible notes, offset by $17.1 million of non-cash deferred tax benefit related to our senior convertible notes. Non-cash expenses for the second quarter of 2016 were comprised primarily of share-based compensation, depreciation and amortization.
Non-GAAP net loss was $14.2 million, or $0.16 per share for the second quarter of 2017, which excludes the non-cash deferred tax benefit related to our senior convertible notes. See the table below entitled “Itemized Reconciliation Between GAAP and Non-GAAP Net Income (Loss) and Net Income (Loss) per Share” for a reconciliation of these GAAP and Non-GAAP financial measures.
As of June 30, 2017, DexCom had $496.6 million in cash, cash equivalents and short-term marketable securities.
DexCom Appoints New CFO
In conjunction with its earnings release, DexCom announced that Quentin Blackford has been appointed Chief Financial Officer, expected to occur on September 1, 2017. Mr. Blackford most recently served as Executive Vice President and Chief Financial Officer, Head of Strategy and Corporate Integrity at NuVasive, where he played a key role through a phase of significant growth and improvements in profitability since 2009. Prior to NuVasive, he was employed at Zimmer Holdings, Inc., serving most recently as Director of Finance and Controller of the Dental Division. Mr. Blackford obtained his Certified Public Accounting license (currently inactive) after receiving dual Bachelor of Science degrees in Accounting and Business Administration from Grace College.
Conference Call
Management will hold a conference call today starting at 4:30 p.m. (Eastern Time). The conference call will be concurrently webcast. The link to the webcast will be available on the DexCom, Inc. website at www.dexcom.com by navigating to "About Us," then "Investor Relations," and then "Events and Presentations," and will be archived for future reference. To listen to the conference call, please dial (800) 446-1671 (US/Canada) or (847) 413-3362 (International) and use the confirmation number "44096457" approximately five minutes prior to the start time.
Statement regarding use of non-GAAP financial measures
DexCom reports non-GAAP results for net loss and net loss per basic and diluted share in addition to, and not as a substitute for, or superior to, financial measures calculated in accordance with GAAP. Our financial measures under GAAP include non-cash deferred tax benefits related to our senior convertible notes as listed in the itemized reconciliation between GAAP and non-GAAP financial measures included in this press release. Management believes that presentation of operating results that excludes this item provides useful supplemental information to investors and facilitates the analysis of our core operating results and comparison of operating results across reporting periods. Management also believes that this supplemental non-GAAP information is therefore useful to investors in analyzing and assessing our past and future operating performance.
These non-GAAP measures may be different from non-GAAP measures used by other companies. In addition, these non-GAAP measures are not based on any comprehensive set of accounting rules or principles. We believe that non-GAAP measures have limitations in that they do not reflect all of the amounts associated with our results of operations as determined in accordance with U.S. GAAP and that these measures should only be used to evaluate our results of operations in conjunction with the corresponding GAAP measures. We encourage investors to carefully consider our results under GAAP, as well as its supplemental non-GAAP information and the reconciliation between these presentations, to more fully understand our business.
About DexCom, Inc.
DexCom, Inc., headquartered in San Diego, California, is developing and marketing continuous glucose monitoring systems for ambulatory use by people with diabetes and by healthcare providers.
Cautionary Statement Regarding Forward Looking Statements
This press release contains forward-looking statements that are not purely historical regarding DexCom’s or its management’s intentions, beliefs, expectations and strategies for the future. All forward-looking statements and reasons why results might differ included in this press release are made as of the date of this release, based on information currently available to DexCom, deal with future events, are subject to various risks and uncertainties, and actual results could differ materially from those anticipated in those forward looking statements. The risks and uncertainties that may cause actual results to differ materially from DexCom’s current expectations are more fully described in DexCom’s quarterly report on Form 10-Q for the period ended June 30, 2017, as filed with the Securities and Exchange Commission on August 1, 2017. Except as required by law, DexCom assumes no obligation to update any such forward-looking statement after the date of this report or to conform these forward-looking statements to actual results.
| DexCom, Inc. | ||||||||
| Consolidated Balance Sheets | ||||||||
| (In millions—except par value data) | ||||||||
| June 30, 2017 | December 31, 2016 | |||||||
| (Unaudited) | ||||||||
| Assets | ||||||||
| Current assets: | ||||||||
| Cash and cash equivalents | $ | 395.9 | $ | 94.5 | ||||
| Short-term marketable securities, available-for-sale | 100.7 | 29.2 | ||||||
| Accounts receivable, net | 101.7 | 101.7 | ||||||
| Inventory | 42.8 | 45.4 | ||||||
| Prepaid and other current assets | 15.7 | 9.2 | ||||||
| Total current assets | 656.8 | 280.0 | ||||||
| Property and equipment, net | 125.0 | 109.4 | ||||||
| Goodwill | 11.9 | 11.3 | ||||||
| Other assets | 1.9 | 2.1 | ||||||
| Total assets | $ | 795.6 | $ | 402.8 | ||||
| Liabilities and stockholders’ equity | ||||||||
| Current liabilities: | ||||||||
| Accounts payable and accrued liabilities | $ | 72.2 | $ | 68.1 | ||||
| Accrued payroll and related expenses | 31.4 | 33.4 | ||||||
| Current portion of deferred revenue | 1.5 | 0.9 | ||||||
| Total current liabilities | 105.1 | 102.4 | ||||||
| Other liabilities | 16.3 | 16.6 | ||||||
| Long term senior convertible notes | 320.5 | — | ||||||
| Total liabilities | 441.9 | 119.0 | ||||||
| Stockholders’ equity: | ||||||||
| Preferred stock, $0.001 par value, 5.0 shares authorized; no shares issued and outstanding at June 30, 2017 and December 31, 2016, respectively | — | — | ||||||
| Common stock, $0.001 par value, 200.0 authorized; 86.8 and 86.5 issued and outstanding, respectively, at June 30, 2017. Common stock, $0.001 par value, 100.0 authorized; 84.9 and 84.6 shares issued and outstanding, respectively, at December 31, 2016. | 0.1 | 0.1 | ||||||
| Additional paid-in capital | 1,015.6 | 905.7 | ||||||
| Accumulated other comprehensive loss | (1.6 | ) | (1.0 | ) | ||||
| Accumulated deficit | (660.4 | ) | (621.0 | ) | ||||
| Total stockholders’ equity | 353.7 | 283.8 | ||||||
| Total liabilities and stockholders’ equity | $ | 795.6 | $ | 402.8 | ||||
| DexCom, Inc. | ||||||||||||||||
| Consolidated Statements of Operations | ||||||||||||||||
| (In millions—except per share data) | ||||||||||||||||
| (Unaudited) | ||||||||||||||||
|
Three Months Ended June 30, |
Six Months Ended June 30, |
|||||||||||||||
| 2017 | 2016 | 2017 | 2016 | |||||||||||||
| Revenues | $ | 170.6 | $ | 137.3 | $ | 312.9 | $ | 253.5 | ||||||||
| Cost of sales | 53.1 | 51.8 | 101.3 | 92.9 | ||||||||||||
| Gross profit | 117.5 | 85.5 | 211.6 | 160.6 | ||||||||||||
| Operating expenses | ||||||||||||||||
| Research and development | 45.3 | 36.3 | 93.4 | 68.5 | ||||||||||||
| Selling, general and administrative | 85.8 | 69.3 | 172.2 | 131.4 | ||||||||||||
| Total operating expenses | 131.1 | 105.6 | 265.6 | 199.9 | ||||||||||||
| Operating loss | (13.6 | ) | (20.1 | ) | (54.0 | ) | (39.3 | ) | ||||||||
| Other income | 1.8 | — | 2.2 | — | ||||||||||||
| Interest income | 0.5 | 0.1 | 0.7 | 0.2 | ||||||||||||
| Interest expense | (3.1 | ) | (0.1 | ) | (3.6 | ) | (0.2 | ) | ||||||||
| Loss before income taxes | (14.4 | ) | (20.1 | ) | (54.7 | ) | (39.3 | ) | ||||||||
| Income tax expense (benefit) | (17.3 | ) | 0.1 | (15.9 | ) | 0.1 | ||||||||||
| Net income (loss) | $ | 2.9 | $ | (20.2 | ) | $ | (38.8 | ) | $ | (39.4 | ) | |||||
| Basic and diluted net income (loss) per share | $ | 0.03 | $ | (0.24 | ) | $ | (0.45 | ) | $ | (0.48 | ) | |||||
| Shares used to compute basic net income (loss) per share | 86.4 | 83.6 | 85.8 | 82.8 | ||||||||||||
| Shares used to compute dilutive net income (loss) per share | 87.4 | 83.6 | 85.8 | 82.8 | ||||||||||||
| DexCom, Inc. | ||||||||
| Revenue by Geography | ||||||||
| (In millions) | ||||||||
| (Unaudited) | ||||||||
| Three Months Ended June 30, | ||||||||
| 2017 | 2016 | |||||||
| US revenue | $ | 140.8 | $ | 119.7 | ||||
| Year over year growth | 18 | % | 48 | % | ||||
| % of total revenue | 83 | % | 87 | % | ||||
| OUS revenue | $ | 29.7 | $ | 17.6 | ||||
| Year over year growth | 69 | % | 42 | % | ||||
| % of total revenue | 17 | % | 13 | % | ||||
| Total revenue | $ | 170.6 | $ | 137.3 | ||||
| Year over year growth | 24 | % | 47 | % | ||||
| DexCom, Inc. | ||||||||
| Revenue by Component | ||||||||
| (In millions) | ||||||||
| (Unaudited) | ||||||||
| Three Months Ended June 30, | ||||||||
| 2017 | 2016 | |||||||
| Sensor revenue | $ | 120.7 | $ | 95.0 | ||||
| Year over year growth | 27 | % | 47 | % | ||||
| % of total revenue | 71 | % | 69 | % | ||||
| Transmitter revenue | $ | 34.7 | $ | 28.3 | ||||
| Year over year growth | 23 | % | 69 | % | ||||
| % of total revenue | 20 | % | 21 | % | ||||
| Receiver revenue | $ | 14.0 | $ | 13.1 | ||||
| Year over year growth | 7 | % | 25 | % | ||||
| % of total revenue | 8 | % | 10 | % | ||||
| Other revenue(1) | $ | 1.2 | $ | 0.9 | ||||
| Total revenue | $ | 170.6 | $ | 137.3 | ||||
| Year over year growth | 24 | % | 47 | % | ||||
(1) Includes revenue from services, freight, accessories, etc.
| DexCom, Inc. | ||||||||||||||||
| Itemized Reconciliation Between GAAP and Non-GAAP Net Income (Loss) and Net Income (Loss) per Share | ||||||||||||||||
| (In millions—except per share data) | ||||||||||||||||
| (Unaudited) | ||||||||||||||||
|
Three Months Ended June 30, |
Six Months Ended June 30, |
|||||||||||||||
| 2017 | 2016 | 2017 | 2016 | |||||||||||||
| GAAP net income (loss) | $ | 2.9 | $ | (20.2 | ) | $ | (38.8 | ) | $ | (39.4 | ) | |||||
| Deferred tax benefit on senior convertible notes (1) | (17.1 | ) | — | (17.1 | ) | — | ||||||||||
| Non-GAAP net loss | $ | (14.2 | ) | $ | (20.2 | ) | $ | (55.9 | ) | $ | (39.4 | ) | ||||
| GAAP basic and diluted net income (loss) per share | $ | 0.03 | $ | (0.24 | ) | $ | (0.45 | ) | $ | (0.48 | ) | |||||
| Deferred tax benefit on senior convertible notes (1) | (0.20 | ) | — | (0.20 | ) | — | ||||||||||
| Non-GAAP basic and diluted net loss per share (2) | $ | (0.16 | ) | $ | (0.24 | ) | $ | (0.65 | ) | $ | (0.48 | ) | ||||
| Shares used to compute net income (loss) per share: | ||||||||||||||||
| Basic | 86.4 | 83.6 | 85.8 | 82.8 | ||||||||||||
| Diluted | 87.4 | 83.6 | 85.8 | 82.8 | ||||||||||||
(1) Non-cash tax benefit associated with the convertible
senior notes.
(2) Earnings per share amounts for the
three months ended June 30, 2017 do not add due to rounding.
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