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DexCom (DXCM) Q3 Earnings and Revenues Surpass Estimates
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DexCom, Inc. (DXCM - Free Report) reported third-quarter 2021 adjusted earnings per share (EPS) of 89 cents, which surpassed the Zacks Consensus Estimate of 62 cents by 43.5%. However, the bottom line declined 5.3% on a year-over-year basis.
GAAP EPS in the quarter was 71 cents, down 2.7% from the prior-year quarter.
Revenue Details
Total revenues grew 30% to $650.2 million on a year-over-year basis and outpaced the Zacks Consensus Estimate by 6.2%. Rising volumes across all channels along with strong new customer additions owing to increasing global awareness of the benefits of real-time Continuous Glucose Monitoring (CGM) contributed to the upside.
Segmental Details
Revenues at the Sensor and other revenue segment (84% of total revenues) climbed 35% on a year-over-year basis to $547.9 million. Hardware revenues (16%) rose 8% year over year to $102.3 million.
Geographical Details
U.S. revenues (75% of total revenues) increased 23% on a year-over-year basis to $489.6 million. International revenues (25%) surged 57% year over year to $160.6 million.
Margin Analysis
Adjusted gross profit in the quarter under review totaled $446.9 million, up 31.3% year over year. DexCom generated adjusted gross margin (as a percentage of revenues) of 68.7%, which expanded 70 basis points (bps) year over year.
Research and development expenses amounted to $128.8 million in the quarter, up 46.9% year over year. Selling, general and administrative expenses totaled $199.8 million in the reported quarter, up 25.9% year over year.
The company reported total operating expenses of $328.6 million, up 33.4% year over year.
The company reported operating income of $118.3 million, up 25.7% from the prior-year quarter. Operating margin (as a percentage of revenues) of 18.2% contracted 60 bps year over year.
Financial Position
The company exited the third quarter with $2.70 billion in cash, cash equivalents and marketable securities, compared with $2.58 billion in the preceding quarter.
Cumulative net cash provided by operating activities in the third quarter amounted to $336.7 million, compared with $303.6 million in the prior-year period.
2021 Guidance
On the basis of robust third-quarter performance, DexCom has decided to raise 2021 guidance for revenues, adjusted gross margin and adjusted operating margin.
The company expects revenues to be $2.43-$2.45 billion (up from the prior guided range of $2.35-$2.40 billion), reflecting growth of 26-27% from the previous year. The Zacks Consensus Estimate for the same is pegged at $2.39 billion.
While adjusted gross margin is anticipated to be about 68% (up from the previous projection of about 67%), adjusted operating margin is estimated to be around 16% (up from the prior guidance of around 14%).
Wrapping Up
DexCom exited the third quarter on a strong note, wherein both earnings and revenues beat the Zacks Consensus Estimate. Impressive contribution from the Sensor and other revenue segment, and domestic and international revenue growth were key catalysts. Expansion in gross margin remains a positive.
Additionally, the glucose monitoring market presents significant commercial opportunities for the company. DexCom’s prospects in alternative markets such as the non-intensive diabetes management space, the hospital, gestational, pre-diabetes and obesity are likely to provide it a competitive edge in the MedTech space.
Apart from making continued advancements with respect to key strategic objectives, DexCom ended the quarter with new patient additions as well.
Nevertheless, contraction in operating margin is a woe. Apart from this, cut-throat competition in the market for blood & glucose monitoring devices remains a concern.
Zacks Rank
Currently, DexCom has a Zacks Rank #3 (Hold).
Earnings of Other MedTech Majors at a Glance
Some better-ranked stocks in the broader medical space that have already announced their quarterly results are Thermo Fisher Scientific Inc. (TMO - Free Report) , West Pharmaceutical Services, Inc. (WST - Free Report) , and AngioDynamics, Inc. (ANGO - Free Report) . While both Thermo Fisher and West Pharmaceutical carry a Zacks Rank of 2 (Buy), AngioDynamics sports a Zacks Rank of 1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Thermo Fisher reported third-quarter 2021 adjusted EPS of $5.76, which beat the Zacks Consensus Estimate by 23.3%. Third-quarter revenues of $9.33 billion outpaced the consensus mark by 12%.
West Pharmaceutical reported third-quarter 2021 adjusted EPS of $2.06, which surpassed the Zacks Consensus Estimate by 13.2%. Third-quarter revenues of $706.5 million outpaced the Zacks Consensus Estimate by 3.2%.
AngioDynamics reported first-quarter fiscal 2022 loss per share of 2 cents, narrower than the Zacks Consensus Estimate of a loss of 5 cents. Revenues of $76.9 million surpassed the Zacks Consensus Estimate by 8.4%.
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DexCom (DXCM) Q3 Earnings and Revenues Surpass Estimates
DexCom, Inc. (DXCM - Free Report) reported third-quarter 2021 adjusted earnings per share (EPS) of 89 cents, which surpassed the Zacks Consensus Estimate of 62 cents by 43.5%. However, the bottom line declined 5.3% on a year-over-year basis.
GAAP EPS in the quarter was 71 cents, down 2.7% from the prior-year quarter.
Revenue Details
Total revenues grew 30% to $650.2 million on a year-over-year basis and outpaced the Zacks Consensus Estimate by 6.2%. Rising volumes across all channels along with strong new customer additions owing to increasing global awareness of the benefits of real-time Continuous Glucose Monitoring (CGM) contributed to the upside.
Segmental Details
Revenues at the Sensor and other revenue segment (84% of total revenues) climbed 35% on a year-over-year basis to $547.9 million. Hardware revenues (16%) rose 8% year over year to $102.3 million.
Geographical Details
U.S. revenues (75% of total revenues) increased 23% on a year-over-year basis to $489.6 million. International revenues (25%) surged 57% year over year to $160.6 million.
Margin Analysis
Adjusted gross profit in the quarter under review totaled $446.9 million, up 31.3% year over year. DexCom generated adjusted gross margin (as a percentage of revenues) of 68.7%, which expanded 70 basis points (bps) year over year.
Research and development expenses amounted to $128.8 million in the quarter, up 46.9% year over year. Selling, general and administrative expenses totaled $199.8 million in the reported quarter, up 25.9% year over year.
DexCom, Inc. Price, Consensus and EPS Surprise
DexCom, Inc. price-consensus-eps-surprise-chart | DexCom, Inc. Quote
The company reported total operating expenses of $328.6 million, up 33.4% year over year.
The company reported operating income of $118.3 million, up 25.7% from the prior-year quarter. Operating margin (as a percentage of revenues) of 18.2% contracted 60 bps year over year.
Financial Position
The company exited the third quarter with $2.70 billion in cash, cash equivalents and marketable securities, compared with $2.58 billion in the preceding quarter.
Cumulative net cash provided by operating activities in the third quarter amounted to $336.7 million, compared with $303.6 million in the prior-year period.
2021 Guidance
On the basis of robust third-quarter performance, DexCom has decided to raise 2021 guidance for revenues, adjusted gross margin and adjusted operating margin.
The company expects revenues to be $2.43-$2.45 billion (up from the prior guided range of $2.35-$2.40 billion), reflecting growth of 26-27% from the previous year. The Zacks Consensus Estimate for the same is pegged at $2.39 billion.
While adjusted gross margin is anticipated to be about 68% (up from the previous projection of about 67%), adjusted operating margin is estimated to be around 16% (up from the prior guidance of around 14%).
Wrapping Up
DexCom exited the third quarter on a strong note, wherein both earnings and revenues beat the Zacks Consensus Estimate. Impressive contribution from the Sensor and other revenue segment, and domestic and international revenue growth were key catalysts. Expansion in gross margin remains a positive.
Additionally, the glucose monitoring market presents significant commercial opportunities for the company. DexCom’s prospects in alternative markets such as the non-intensive diabetes management space, the hospital, gestational, pre-diabetes and obesity are likely to provide it a competitive edge in the MedTech space.
Apart from making continued advancements with respect to key strategic objectives, DexCom ended the quarter with new patient additions as well.
Nevertheless, contraction in operating margin is a woe. Apart from this, cut-throat competition in the market for blood & glucose monitoring devices remains a concern.
Zacks Rank
Currently, DexCom has a Zacks Rank #3 (Hold).
Earnings of Other MedTech Majors at a Glance
Some better-ranked stocks in the broader medical space that have already announced their quarterly results are Thermo Fisher Scientific Inc. (TMO - Free Report) , West Pharmaceutical Services, Inc. (WST - Free Report) , and AngioDynamics, Inc. (ANGO - Free Report) . While both Thermo Fisher and West Pharmaceutical carry a Zacks Rank of 2 (Buy), AngioDynamics sports a Zacks Rank of 1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Thermo Fisher reported third-quarter 2021 adjusted EPS of $5.76, which beat the Zacks Consensus Estimate by 23.3%. Third-quarter revenues of $9.33 billion outpaced the consensus mark by 12%.
West Pharmaceutical reported third-quarter 2021 adjusted EPS of $2.06, which surpassed the Zacks Consensus Estimate by 13.2%. Third-quarter revenues of $706.5 million outpaced the Zacks Consensus Estimate by 3.2%.
AngioDynamics reported first-quarter fiscal 2022 loss per share of 2 cents, narrower than the Zacks Consensus Estimate of a loss of 5 cents. Revenues of $76.9 million surpassed the Zacks Consensus Estimate by 8.4%.