Summary
DexCom, Inc. (DXCM) reported strong revenue growth in the third quarter and first nine months of 2018 compared to the prior year, driven by increased sales volume of its continuous glucose monitoring (CGM) systems. The company achieved profitability in the third quarter of 2018, a significant turnaround from the losses reported in the same period of 2017. This positive shift is attributed to increased revenue and improved gross margins, partially offset by higher operating expenses, particularly in selling, general, and administrative functions, which are being invested to support growth. The company also recognized substantial income from its equity investment in Tandem Diabetes Care, Inc., further boosting net income. Financially, DexCom ended the quarter with a healthy cash position and a significant increase in both current assets and total assets compared to the prior year-end. While accounts payable and accrued liabilities saw an increase, the company maintains a strong working capital position. The company's liquidity appears sound, with sufficient cash, cash equivalents, and marketable securities to fund operations through at least the next twelve months. The strong operational performance and strategic investments in growth areas suggest a positive trajectory for DexCom.
Financial Highlights
51 data points| Revenue | $266.70M |
| Cost of Revenue | $98.10M |
| Gross Profit | $168.60M |
| R&D Expenses | $50.10M |
| SG&A Expenses | $104.60M |
| Operating Expenses | $154.70M |
| Operating Income | $13.90M |
| Interest Expense | $4.90M |
| Net Income | $46.60M |
| EPS (Basic) | $0.13 |
| EPS (Diluted) | $0.13 |
| Shares Outstanding (Basic) | 354.00M |
| Shares Outstanding (Diluted) | 361.20M |
Key Highlights
- 1Revenue increased by 44.5% to $266.7 million for the third quarter of 2018 compared to $184.6 million in the same period of 2017.
- 2For the nine months ended September 30, 2018, revenue grew by 39.4% to $693.6 million compared to $497.5 million in the prior year.
- 3The company achieved net income of $46.6 million for the third quarter of 2018, a significant improvement from a net loss of $2.0 million in the third quarter of 2017.
- 4Gross profit margin decreased slightly to 63% in Q3 2018 from 69% in Q3 2017, attributed to channel strategy and product mix changes, despite an increase in gross profit dollars.
- 5Operating expenses increased, with Selling, General, and Administrative expenses rising significantly to support revenue growth and commercialization efforts.
- 6Income from equity investments, primarily in Tandem Diabetes Care, Inc., contributed substantially to the net income ($34.9 million in Q3 2018).
- 7Cash, cash equivalents, and marketable securities totaled $668.7 million as of September 30, 2018, providing a solid liquidity position.