• Worldwide Revenue: $1.036 billion, up 12% reported and 14% organic growth compared to Q1 2024.
• US Revenue: $751 million, a 15% increase from Q1 2024.
• International Revenue: $286 million, 7% growth reported and 12% organic growth.
• Gross Profit: $596.2 million, 57.5% of revenue, down from 61.8% in Q1 2024.
• Operating Expenses: $455.3 million for Q1 2025.
• Operating Income: $143.1 million, 13.8% of revenue, compared to $140.2 million, 15.2% of revenue in Q1 2024.
• Adjusted EBITDA: $230.4 million, 22.2% of revenue, compared to 24% in Q1 2024.
• Net Income: $127.7 million or $0.32 per share.
• Cash and Cash Equivalents: Approximately $2.7 billion.
• Share Repurchase Program: Announced $750 million share repurchase program.
• Full-Year Revenue Guidance: Reaffirmed at $4.6 billion, 14% growth.
• Full-Year Gross Profit Margin Guidance: Reduced to approximately 62%.
• Full-Year Operating Margin and Adjusted EBITDA Margin Guidance: Reaffirmed at approximately 21% and 30%, respectively.

• Warning! GuruFocus has detected 3 Warning Signs with DXCM.

Release Date: May 01, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• DexCom Inc (NASDAQ:DXCM) reported a 14% organic revenue growth in Q1 2025 compared to Q1 2024, marking the second consecutive quarter of reaccelerating revenue growth.
• The company successfully navigated short-term supply dynamics while maintaining strong demand in the US market, ensuring limited customer disruption.
• DexCom Inc (NASDAQ:DXCM) expanded its commercial reach, leading to record levels of new customer starts, particularly from the type 2 non-insulin population.
• The introduction of Stelo, the first over-the-counter CGM, and broader coverage within the type 2 market have been well-received, enhancing customer experience.
• DexCom Inc (NASDAQ:DXCM) announced a $750 million share repurchase program, reflecting confidence in its strong revenue and cash flow growth outlook.

Negative Points

• DexCom Inc (NASDAQ:DXCM) received a warning letter from the FDA related to observations at its San Diego and Mesa facilities, requiring corrective actions.
• The company's gross profit margin decreased to 57.5% in Q1 2025 from 61.8% in Q1 2024, impacted by supply chain issues and increased freight costs.
• Despite strong Q1 performance, DexCom Inc (NASDAQ:DXCM) maintained its full-year revenue guidance, indicating caution about future quarters.
• The international revenue growth was below expectations, with some choppiness due to the timing of coverage wins and supply dynamics.
• DexCom Inc (NASDAQ:DXCM) faces ongoing inflationary pressures and potential tariff impacts, which could affect global manufacturing costs.

Q & A Highlights

Q: Can you discuss the impact of supply dynamics on US revenue growth and the gap between volume and revenue growth? A: Jereme Sylvain, CFO, explained that they exited the quarter with normalized supply levels, which required significant effort. Despite this, they achieved a record new patient quarter, indicating strong performance. The volume growth aligns with a 25% patient increase, consistent with previous trends, and the price-volume gap is closing as expected.

Q: Why did you maintain full-year guidance despite 14% organic growth in Q1, and how does the 15 Day launch affect gross margin guidance? A: Jereme Sylvain, CFO, stated that it's early in the year, and they want to see how the year unfolds before adjusting guidance. The 15 Day launch was included in the original guidance, and its impact on gross margin is expected to be small initially, as it will ramp up over time.

Q: What trends are you seeing in type 2 non-insulin and basal patient utilization and retention? A: Kevin Sayer, CEO, noted strong retention rates in these populations, particularly with reimbursement. Stelo users are also reordering regularly. Jereme Sylvain added that utilization remains strong in covered markets, and Stelo is seeing good uptake among type 2 users.

Q: How exposed is DexCom to a potential recession, and how did you analyze this risk? A: Jereme Sylvain, CFO, explained that they've analyzed their exposure to coverage levels and economic conditions. DexCom's products save costs and are integral to care patterns, positioning them well to weather economic downturns. Kevin Sayer emphasized their value in providing cost-effective health solutions.

Q: Can you provide more details on the international revenue performance and any supply chain impacts? A: Jereme Sylvain, CFO, highlighted pockets of strength in France and Japan due to coverage expansions. While there is some choppiness in international business due to timing of coverage wins, underlying volume demand remains strong. Supply dynamics did not significantly impact international revenue.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.