DexCom is continuing its upward trajectory in sales by bringing in solid 3Q19 earnings. The San Diego-based company toppled consensus estimates and updated sales guidance for the year to $1.43 billion to $1.45 billion compared to previous guidance of $1.33 billion to $1.38 billion.
As a result of the earnings, the company’s shares increased by 15% after hours on Wednesday. Kevin Sayer, chairman, president, and CEO of DexCom spoke on the significance of the earnings.
“The third quarter represents our highest U.S. growth rate since the first quarter of 2016 when the business was much smaller,” Sayer said during the 3Q19 earnings call, according to a transcript from Seeking Alpha. “The third quarter included the highest absolute dollar growth in the history of our company increasing nearly $130 million over the third quarter of 2018. We not only achieved profitability in the third quarter but for the first time ever through nine months we are profitable on both a GAAP and non-GAAP basis.”
Sayer noted the reason for the earnings growth could be summed up to the rise in acceptance of continuous glucose monitoring.
“More and more people are becoming aware of the value of DexCom's real-time CGM and with G6 we have the right product to meet their needs,” Sayer said according to a transcript of the 3Q19 earnings call from Seeking Alpha. “We often highlight access and awareness as the primary answers for the growth that we are experiencing. But this is the result of years of work from the DexCom team. It is the result of many people embracing our core values to think big.”
The 3Q19 earnings are a solid win for DexCom as it faces continued pressure from other CGM competitors such as Abbott and Senseonics. In recent months, the company has been working toward improving its position in the market. The firm recently reported winning a nod from FDA for the Dexcom G6 Pro CGM System for healthcare professionals to use with their patients, ages two years and up.
The pro-version builds off the DexCom G6, which won a nod from FDAlast year. It was considered a milestone decision by FDA because it classified Dexcom's CGM system as a less-stringent class II medical device -interoperable with other technologies, therefore, enabling a speedier review for similar future systems.
During the earnings call, Steven Pacelli, executive vice president of strategy and corporate development for DexCom spoke on the significance of the FDA nod and the promise of the Pro technology.
“This is another strong example of the streamline review process enabled by our ICGM designation, giving us the opportunity to quickly iterate products to serve the knees of different customer segments,” Pacelli said, according to a Seeking Alpha Transcript. “The G6 Pro represents the first disposable professional CGM product that is indicated for either blinded or unblinded real-time use.”