Dexcom Inc. (NSDQ:DXCM) released its 2nd quarter earnings late yesterday, nailing Wall Street analysts expectations for revenue but missing on earnings per share by nearly double, seeing shares shrink in response.
The San Diego, Calif.-based company reported losses of $20.2 million, or 24¢ per share, on sales of $137.3 million for the 3 months ended June 30. That amounts to a massive 445% increase in losses on the bottom end while sales swelled 47.8% compared with the same period from the prior year.
The Street was looking for DexCom to bring in $137.3 million in revenue and keep losses per share at 12¢. The company managed to nail the revenue figures, but missed by nearly double on earnings per share, according to a press release.
Stocks drooped in post-market trading yesterday after the release, falling over 5% to open at $87.84, down from yesterday’s open of $92.49. Prices have risen a little in early morning trading, at $91.48 as of 9:41 a.m. EDT
“We’re obviously very pleased with our continued growth during the second quarter. In fact, by our estimates, we’ve added in excess of 2% of the U.S. type 1 population to our installed base during the first half of this year. That’s a big number, 2%. And it’s very important that this technology continues to penetrate that market. With respect to our financial performance, we’ve experienced some growing pains in our hardware manufacturing and our customer service organization and we continue to invest strategically on a number of fronts. That being said, we have not lost our long term focus on leverage and in fact our day-to-day operating expenses are aligned with the levels we projected. Specifically with respect to customer operations, I’m pleased to report that as of the end of July we have returned to, and in some cases, surpassed the levels of customer service that the DexCom patient community expects of us,” CEO Kevin Sayer said during an earnings conference call.
The higher-than-expected net loss was due primarily to increased warranty expense and inventory write-down, according to strategy & corporate dev exec veep Steven Pacelli.
The company lifted its guidance after the quarter, now expecting to bring in between $550 and $575 million for the full year.
Late last month, an advisory panel recommended that the FDA grant Dexcom‘s (NSDQ:DXCM) bid for a non-adjuctive dosing claim for its G5 continuous glucose monitor.
The panel voted 8-2 on the safety question, 9-1 on the effectiveness question and 8-2 that the benefits outweigh the risks, according to a Leerink Partners note to investors.
The FDA is not bound by its advisory panels’ votes, but often heeds their advice in making its decisions.
The new indication would allow the next-gen G5 CGM to replace, rather than complement, fingerstick blood glucose testing.
