Dexcom reports second quarter 2023 financial results

DexCom, Inc. reported its financial results as of and for the quarter ended June 30, 2023.

Second quarter 2023 financial hghlights:

• Revenue grew 25% versus the same quarter of the prior year to $871.3 million on a reported basis and 26% on an organic¹ basis.
• U.S. revenue growth of 21% and international revenue growth of 38% on a reported basis. International revenue growth was 40% on an organic¹ basis.
• GAAP operating income of $128.1 million or 14.7% of revenue, an increase of 360 basis points compared to the second quarter of 2022. Non-GAAP operating income* of $158.4 million or 18.2% of reported revenue, an increase of 360 basis points compared with the same quarter of the prior year.

Second quarter 2023 strategic highlights:

• Provided key strategic updates and increased long-term financial outlook at company’s 2023 Investor Day
• Showcased future potential of Dexcom CGM within diabetes care and beyond through significant research presence at the American Diabetes Association’s 83^rd Scientific Sessions
• Initiated commercial production at Malaysia manufacturing facility, representing key milestone in long-term capacity plans
• Completed a $1.25 billion senior convertible notes offering, creating additional financial flexibility for company

“In the second quarter, we advanced several key strategic initiatives and shared our latest vision for the future of Dexcom at our 2023 Investor Day,” said Kevin Sayer, Dexcom’s chairman, president and CEO. “Given our strong start to the year and rapidly growing market opportunity, we are pleased to raise our 2023 revenue and margin guidance.”

2023 annual guidance
The company is increasing fiscal year 2023 guidance for revenue, Non-GAAP Gross Profit Margin, Non-GAAP Operating Margin, and Adjusted EBITDA Margin at the following levels:

• Revenue of approximately $3.500 – 3.550 billion (20-22% growth)
• Non-GAAP Gross Profit Margin of approximately 63%
• Non-GAAP Operating Margin of approximately 17%
• Adjusted EBITDA Margin of approximately 26.5%

Second quarter 2023 financial results
Revenue: In the second quarter of 2023, worldwide revenue grew 25% to $871.3 million on a reported basis, up from $696.2 million in the second quarter of 2022. Volume growth in conjunction with strong new customer additions continues to be the primary driver of revenue growth as awareness of real-time CGM increases.

Gross profit: GAAP gross profit totaled $546.4 million or 62.7% of revenue for the second quarter of 2023, compared to $449.5 million or 64.6% of revenue in the second quarter of 2022.

Non-GAAP gross profit* totaled $553.5 million or 63.5% of revenue for the second quarter of 2023, compared to $449.5 million or 64.6% of reported revenue in the second quarter of 2022.

Operating income: GAAP operating income for the second quarter of 2023 was $128.1 million, compared to GAAP operating income of $77.0 million for the second quarter of 2022.

Non-GAAP operating income* for the second quarter of 2023 was $158.4 million, compared to non-GAAP operating income of $101.9 million for the second quarter of 2022.

Net income and diluted net income per share: GAAP net income was $115.9 million, or $0.28 per diluted share, for the second quarter of 2023, compared to GAAP net income of $50.9 million, or $0.12 per diluted share, for the same quarter of 2022.

Non-GAAP net income* was $139.4 million, or $0.34 per diluted share, for the second quarter of 2023, compared to non-GAAP net income of $69.5 million, or $0.17 per diluted share, for the same quarter of 2022. The second quarter 2023 non-GAAP amount excludes $0.7 million of business transition and related costs, $20.8 million of intellectual property litigation costs, $8.8 million of amortization of intangible assets, and $(6.8) million of tax adjustments.

Cash and liquidity: As of June 30, 2023, Dexcom held $3.64 billion in cash, cash equivalents and marketable securities and our revolving credit facility remains undrawn. The cash balance represents significant financial and strategic flexibility as Dexcom continues to expand production capacity and explore new market opportunities.
MB Bureau