From “CNBC”: 2024-07-25 17:31:59

Shares of Dexcom plummeted by nearly 40% in after-hours trading following disappointing revenue reports for the second quarter. Earnings per share were 43 cents adjusted versus the expected 39 cents with revenue at $1 billion compared to the anticipated $1.04 billion by LSEG. The company’s revenue rose by 15% from the previous year, with net income increasing to $143.5 million.

Dexcom offered weak guidance for the third quarter, expecting revenue between $975 million to $1 billion due to certain unique factors impacting 2024 seasonality. The company also revised its full fiscal year revenue forecast to $4 billion to $4.05 billion down from the initial $4.20 billion to $4.35 billion projection.

CEO Kevin Sayer attributed the revenue challenges to a restructuring of the sales team, fewer new customers, and lower revenue per user. Dexcom underperformed in the durable medical equipment (DME) channel and customers have been utilizing rebates for the new CGM, G7. The company is set to launch Stelo, a new CGM for Type 2 diabetes patients in August.

JPMorgan analyst Robbie Marcus expressed surprise at the significant guidance drop and questioned whether the popularity of GLP-1 weight-loss treatments is a factor. CEO Sayer acknowledged the sales force reshuffling’s larger impact, leading to a $300 million shortfall in company guidance for the year. CFO Jereme Sylvain emphasized transparency in addressing the challenges.



Read more at “CNBC”:: Dexcom (DXCM) Q2 earnings report