Dexcom Reports Fourth Quarter and Fiscal Year 2022 Financial Results
DexCom reported its Q4 and full year 2022 results, highlighting a 17% revenue increase to $815.2 million in Q4 and 19% growth for the year, totaling $2.91 billion. U.S. revenue grew by 17% and international by 15% (27% organic). GAAP operating income rose to $125.4 million (15.4% margin), while non-GAAP reached $172.1 million (21.1% margin). The company launched the Dexcom G7 CGM system and plans for a revenue guidance of $3.35 - 3.49 billion for 2023, signifying 15-20% growth. DexCom ended 2022 with $2.46 billion in cash and equivalents.
- Fourth quarter 2022 revenue increased by 17% year-over-year to $815.2 million.
- Full-year revenue reached $2.91 billion, a 19% increase compared to 2021.
- GAAP operating income improved to $125.4 million, a significant rise from the previous year.
- FDA clearance received for the Dexcom G7 CGM system, enhancing product offerings.
- Strong cash position with $2.46 billion as of December 31, 2022.
- GAAP gross profit margin slightly declined from 67.7% in Q4 2021 to 66.4% in Q4 2022.
Fourth Quarter 2022 Financial Highlights:
-
Revenue grew
17% versus the same quarter of the prior year to on a reported basis and$815.2 million 20% on an organic1 basis. -
U.S. revenue growth of17% and international revenue growth of15% on a reported basis. International revenue growth was27% on an organic1 basis. -
GAAP operating income of
or$125.4 million 15.4% of revenue, an increase of 1,530 basis points compared to the fourth quarter of 2021. Non-GAAP operating income* of or$172.1 million 21.1% of revenue, an increase of 1,940 basis points compared with the same quarter of the prior year.
Full Year 2022 Financial Highlights:
-
Full year revenue grew
19% versus the prior year to on a reported basis and$2.91 billion 20% on an organic1 basis. -
U.S. revenue growth of16% and international revenue growth of28% on a reported basis. International revenue growth was31% on an organic1 basis. -
GAAP operating income of
or$391.2 million 13.4% of revenue, an increase of 250 basis points compared to 2021. Non-GAAP operating income* of or$485.1 million 16.7% of revenue, an increase of 510 basis points over the prior year.
Fourth Quarter 2022 Strategic Highlights:
- Received FDA clearance for the Dexcom G7 CGM system for people with diabetes ages two years and older. Dexcom G7 represents the most accurate2 and simple CGM system from the most covered3 CGM brand.
-
In support of National Diabetes Awareness Month, partnered with Dexcom Warriors
Patti LaBelle ,Mark Andrews andBambi Northwood-Blyth in an awareness campaign designed to advocate for greater access to diabetes care -
Advanced international portfolio strategy with the introduction of Dexcom ONE in
Belgium ,Croatia ,Greece ,Italy andRomania
“2022 proved to be another great year for
____________________ | ||
1 |
Excludes non-CGM revenue acquired in the trailing twelve months, as well as the impact of foreign exchange. |
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2 |
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3 |
|
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2023 Annual Guidance
The company is reiterating guidance for fiscal year 2023 revenue, Non-GAAP Gross Profit Margin, and Non-GAAP Operating Margin, and establishing guidance for Adjusted EBITDA Margin at the following levels:
-
Revenue of approximately
- 3.49 billion (15$3.35 -20% growth) -
Non-GAAP Gross Profit Margin of 62
-63% -
Non-GAAP Operating Margin of approximately
16.5% -
Adjusted EBITDA Margin of approximately
26%
Fourth Quarter 2022 Financial Results
Revenue: In the fourth quarter of 2022, worldwide revenue grew
Gross Profit: GAAP gross profit totaled
Non-GAAP gross profit* totaled
Operating Income: GAAP operating income for the fourth quarter of 2022 was
Non-GAAP operating income* for the fourth quarter of 2022 was
Net Income (Loss) and Net Income (Loss) per Share: GAAP net income was
Non-GAAP net income* was
Cash and Liquidity: As of
* See Table E below for a reconciliation of these GAAP and non-GAAP financial measures.
Conference Call
Management will hold a conference call today starting at
Statement Regarding Use of Non-GAAP Financial Measures
This press release and the accompanying tables include non-GAAP financial measures. For a description of these non-GAAP financial measures, including the reasons management uses each measure, and reconciliations of these non-GAAP financial measures to the most directly comparable financial measures prepared in accordance with Generally Accepted Accounting Principles (GAAP), please see the section of the accompanying tables titled “About Non-GAAP Financial Measures” as well as the related Table E. We have not reconciled our total revenue, Non-GAAP Gross Profit Margin, Non-GAAP Operating Margin and Adjusted EBITDA Margin estimates for fiscal year 2023 because certain items that impact these figures are uncertain or out of our control and cannot be reasonably predicted. Accordingly, a reconciliation of total revenue, Non-GAAP Gross Profit Margin, Non-GAAP Operating Margin and Adjusted EBITDA Margin is not available without unreasonable effort.
About
Cautionary Statement Regarding Forward Looking Statements
This press release contains forward-looking statements that are not purely historical regarding Dexcom’s or its management’s intentions, beliefs, expectations and strategies for the future, including those related to Dexcom’s estimated total revenue, Non-GAAP Gross Profit Margin, Non-GAAP Operating Margin, and Adjusted EBITDA Margin for fiscal 2023, as well as expected growth rates as compared to the year ended
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Table A |
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Consolidated Balance Sheets |
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(In millions, except par value data) |
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||||
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|
|
|
||||
Assets |
|
|
(As Adjusted)* |
|||||
Current assets: |
|
|
|
|||||
Cash and cash equivalents |
$ |
642.3 |
|
|
$ |
1,052.6 |
|
|
Short-term marketable securities |
|
1,813.9 |
|
|
|
1,678.6 |
|
|
Accounts receivable, net |
|
713.3 |
|
|
|
514.3 |
|
|
Inventory |
|
306.7 |
|
|
|
357.3 |
|
|
Prepaid and other current assets |
|
192.6 |
|
|
|
81.6 |
|
|
Total current assets |
|
3,668.8 |
|
|
|
3,684.4 |
|
|
Property and equipment, net |
|
1,055.6 |
|
|
|
801.8 |
|
|
Operating lease right-of-use assets |
|
80.0 |
|
|
|
88.1 |
|
|
|
|
25.7 |
|
|
|
26.5 |
|
|
Intangibles, net |
|
173.3 |
|
|
|
31.5 |
|
|
Deferred tax assets |
|
341.2 |
|
|
|
290.5 |
|
|
Other assets |
|
47.1 |
|
|
|
10.5 |
|
|
Total assets |
$ |
5,391.7 |
|
|
$ |
4,933.3 |
|
|
Liabilities and Stockholders’ Equity |
|
|
|
|||||
Current liabilities: |
|
|
|
|||||
Accounts payable and accrued liabilities |
$ |
901.8 |
|
|
$ |
573.0 |
|
|
Accrued payroll and related expenses |
|
134.3 |
|
|
|
125.2 |
|
|
Current portion of long-term senior convertible notes |
|
772.6 |
|
|
|
— |
|
|
Short-term operating lease liabilities |
|
20.5 |
|
|
|
20.5 |
|
|
Deferred revenue |
|
10.1 |
|
|
|
2.1 |
|
|
Total current liabilities |
|
1,839.3 |
|
|
|
720.8 |
|
|
Long-term senior convertible notes |
|
1,197.7 |
|
|
|
1,981.8 |
|
|
Long-term operating lease liabilities |
|
94.6 |
|
|
|
98.6 |
|
|
Other long-term liabilities |
|
128.3 |
|
|
|
90.0 |
|
|
Total liabilities |
|
3,259.9 |
|
|
|
2,891.2 |
|
|
Commitments and contingencies |
|
|
|
|||||
Stockholders’ equity: |
|
|
|
|||||
Preferred stock, |
|
— |
|
|
|
— |
|
|
Common stock, |
|
0.4 |
|
|
|
0.4 |
|
|
Additional paid-in capital |
|
2,258.1 |
|
|
|
2,108.7 |
|
|
Accumulated other comprehensive income (loss) |
|
(11.6 |
) |
|
|
0.5 |
|
|
Retained earnings |
|
479.9 |
|
|
|
138.7 |
|
|
|
|
(595.0 |
) |
|
|
(206.2 |
) |
|
Total stockholders’ equity |
|
2,131.8 |
|
|
|
2,042.1 |
|
|
Total liabilities and stockholders’ equity |
$ |
5,391.7 |
|
|
$ |
4,933.3 |
|
|
|
|
|
|
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* We adjusted our 2021 amounts to reflect the simplified convertible instruments accounting guidance (ASU 2020-06), which we adopted on a full retrospective basis. All periods presented have also been adjusted to reflect the four-for-one stock split. |
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Table B |
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Consolidated Statements of Operations |
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(In millions, except per share data) |
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(Unaudited) |
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|
|
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|
||||||||||||
|
|
Three Months Ended
|
|
Twelve Months Ended
|
||||||||||||
|
|
2022 |
|
2021 |
|
2022 |
|
2021 |
||||||||
|
|
|
|
(As Adjusted)* |
|
|
|
(As Adjusted)* |
||||||||
Revenue |
$ |
815.2 |
|
|
$ |
698.2 |
|
|
$ |
2,909.8 |
|
|
$ |
2,448.5 |
|
|
Cost of sales |
|
273.9 |
|
|
|
225.6 |
|
|
|
1,026.7 |
|
|
|
768.0 |
|
|
Gross profit |
|
541.3 |
|
|
|
472.6 |
|
|
|
1,883.1 |
|
|
|
1,680.5 |
|
|
Operating expenses: |
|
|
|
|
|
|
|
|||||||||
Research and development |
|
116.3 |
|
|
|
149.8 |
|
|
|
484.2 |
|
|
|
517.1 |
|
|
Collaborative research and development fee |
|
— |
|
|
|
87.1 |
|
|
|
— |
|
|
|
87.1 |
|
|
Amortization of intangible assets |
|
1.8 |
|
|
|
1.4 |
|
|
|
7.5 |
|
|
|
3.7 |
|
|
Selling, general and administrative |
|
297.8 |
|
|
|
233.7 |
|
|
|
1,000.2 |
|
|
|
806.8 |
|
|
Total operating expenses |
|
415.9 |
|
|
|
472.0 |
|
|
|
1,491.9 |
|
|
|
1,414.7 |
|
|
Operating income |
|
125.4 |
|
|
|
0.6 |
|
|
|
391.2 |
|
|
|
265.8 |
|
|
Interest expense |
|
(4.7 |
) |
|
|
(4.7 |
) |
|
|
(18.6 |
) |
|
|
(18.8 |
) |
|
Loss on extinguishment of debt |
|
— |
|
|
|
(0.1 |
) |
|
|
— |
|
|
|
(0.1 |
) |
|
Income from equity investments |
|
— |
|
|
|
11.6 |
|
|
|
0.2 |
|
|
|
11.6 |
|
|
Interest and other income (expense), net |
|
12.5 |
|
|
|
(1.0 |
) |
|
|
18.0 |
|
|
|
(1.7 |
) |
|
Income before income taxes |
|
133.2 |
|
|
|
6.4 |
|
|
|
390.8 |
|
|
|
256.8 |
|
|
Income tax expense |
|
41.4 |
|
|
|
11.7 |
|
|
|
49.6 |
|
|
|
39.9 |
|
|
Net income (loss) |
$ |
91.8 |
|
|
$ |
(5.3 |
) |
|
$ |
341.2 |
|
|
$ |
216.9 |
|
|
|
|
|
|
|
|
|
|
|||||||||
Basic net income (loss) per share |
$ |
0.24 |
|
|
$ |
(0.01 |
) |
|
$ |
0.88 |
|
|
$ |
0.56 |
|
|
Shares used to compute basic net income (loss) per share |
|
386.3 |
|
|
|
387.8 |
|
|
|
389.4 |
|
|
|
386.9 |
|
|
Diluted net income (loss) per share |
$ |
0.22 |
|
|
$ |
(0.01 |
) |
|
$ |
0.82 |
|
|
$ |
0.53 |
|
|
Shares used to compute diluted net income (loss) per share |
|
425.9 |
|
|
|
387.8 |
|
|
|
427.5 |
|
|
|
428.8 |
|
|
|
|
|
|
|
|
|
|
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* We adjusted our 2021 amounts to reflect the simplified convertible instruments accounting guidance (ASU 2020-06), which we adopted on a full retrospective basis. All periods presented have also been adjusted to reflect the four-for-one stock split. |
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Table C |
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Revenue by Geography |
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(Dollars in millions) |
||||||||||||||||
(Unaudited) |
||||||||||||||||
|
|
|
|
|
||||||||||||
|
|
Three Months Ended
|
|
Twelve Months Ended
|
||||||||||||
|
|
2022 |
|
2021 |
|
2022 |
|
2021 |
||||||||
|
$ |
606.4 |
|
|
$ |
517.1 |
|
|
$ |
2,142.0 |
|
|
$ |
1,849.4 |
|
|
Year over year growth |
|
17 |
% |
|
|
15 |
% |
|
|
16 |
% |
|
|
23 |
% |
|
% of total revenue |
|
74 |
% |
|
|
74 |
% |
|
|
74 |
% |
|
|
76 |
% |
|
|
|
|
|
|
|
|
|
|||||||||
International revenue |
$ |
208.8 |
|
|
$ |
181.1 |
|
|
$ |
767.8 |
|
|
$ |
599.1 |
|
|
Year over year growth |
|
15 |
% |
|
|
54 |
% |
|
|
28 |
% |
|
|
44 |
% |
|
% of total revenue |
|
26 |
% |
|
|
26 |
% |
|
|
26 |
% |
|
|
24 |
% |
|
|
|
|
|
|
|
|
|
|||||||||
Total revenue (1) |
$ |
815.2 |
|
|
$ |
698.2 |
|
|
$ |
2,909.8 |
|
|
$ |
2,448.5 |
|
|
Year over year growth |
|
17 |
% |
|
|
23 |
% |
|
|
19 |
% |
|
|
27 |
% |
|
(1) The sum of the revenue components may not equal total revenue due to rounding. |
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Table D |
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Revenue by Component |
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(Dollars in millions) |
||||||||||||||||
(Unaudited) |
||||||||||||||||
|
|
|
|
|
||||||||||||
|
|
Three Months Ended
|
|
Twelve Months Ended
|
||||||||||||
|
|
2022 |
|
2021 |
|
2022 |
|
2021 |
||||||||
Sensor and other revenue (1) (2) |
$ |
714.8 |
|
|
$ |
598.6 |
|
|
$ |
2,522.3 |
|
|
$ |
2,065.3 |
|
|
Year over year growth |
|
19 |
% |
|
|
29 |
% |
|
|
22 |
% |
|
|
32 |
% |
|
% of total revenue |
|
88 |
% |
|
|
86 |
% |
|
|
87 |
% |
|
|
84 |
% |
|
|
|
|
|
|
|
|
|
|||||||||
Hardware revenue (1) (3) |
$ |
100.4 |
|
|
$ |
99.6 |
|
|
$ |
387.5 |
|
|
$ |
383.2 |
|
|
Year over year growth |
|
1 |
% |
|
|
(4 |
)% |
|
|
1 |
% |
|
|
5 |
% |
|
% of total revenue |
|
12 |
% |
|
|
14 |
% |
|
|
13 |
% |
|
|
16 |
% |
|
|
|
|
|
|
|
|
|
|||||||||
Total revenue (4) |
$ |
815.2 |
|
|
$ |
698.2 |
|
|
$ |
2,909.8 |
|
|
$ |
2,448.5 |
|
|
Year over year growth |
|
17 |
% |
|
|
23 |
% |
|
|
19 |
% |
|
|
27 |
% |
|
(1) Includes allocated subscription revenue. |
||||||||||||||||
(2) Includes services, freight, accessories, Non-CGM acquired revenue, etc. |
||||||||||||||||
(3) Includes transmitter and receiver revenue. |
||||||||||||||||
(4) The sum of the revenue components may not equal total revenue due to rounding. |
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|
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Table E |
||||||||||||||||
Itemized Reconciliation Between GAAP and Non-GAAP Financial Measures |
||||||||||||||||
(In millions, except per share data) |
||||||||||||||||
(Unaudited) |
||||||||||||||||
|
|
|
|
|
||||||||||||
|
|
Three Months Ended
|
|
Twelve Months Ended
|
||||||||||||
|
|
2022 |
|
2021 |
|
2022 |
|
2021 |
||||||||
|
|
|
|
(As Adjusted)* |
|
|
|
(As Adjusted)* |
||||||||
GAAP gross profit |
$ |
541.3 |
|
|
$ |
472.6 |
|
|
$ |
1,883.1 |
|
|
$ |
1,680.5 |
|
|
Amortization of intangible assets (1) |
|
2.4 |
|
|
|
— |
|
|
|
2.4 |
|
|
|
— |
|
|
Non-GAAP gross profit |
$ |
543.7 |
|
|
$ |
472.6 |
|
|
$ |
1,885.5 |
|
|
$ |
1,680.5 |
|
|
|
|
|
|
|
|
|
|
|||||||||
GAAP operating income |
$ |
125.4 |
|
|
$ |
0.6 |
|
|
$ |
391.2 |
|
|
$ |
265.8 |
|
|
Amortization of intangible assets (1) |
|
4.2 |
|
|
|
1.4 |
|
|
|
9.9 |
|
|
|
3.7 |
|
|
Business transition and related costs (2) |
|
24.1 |
|
|
|
— |
|
|
|
39.5 |
|
|
|
— |
|
|
Intellectual property litigation costs (3) |
|
18.4 |
|
|
|
9.9 |
|
|
|
44.5 |
|
|
|
14.1 |
|
|
Non-GAAP operating income |
$ |
172.1 |
|
|
$ |
11.9 |
|
|
$ |
485.1 |
|
|
$ |
283.6 |
|
|
|
|
|
|
|
|
|
|
|||||||||
GAAP net income (loss) |
$ |
91.8 |
|
|
$ |
(5.3 |
) |
|
$ |
341.2 |
|
|
$ |
216.9 |
|
|
Business transition and related costs (2) |
|
23.9 |
|
|
|
— |
|
|
|
39.3 |
|
|
|
— |
|
|
Depreciation and amortization |
|
36.3 |
|
|
|
32.1 |
|
|
|
155.9 |
|
|
|
102.0 |
|
|
Intellectual property litigation costs (3) |
|
18.4 |
|
|
|
9.9 |
|
|
|
44.5 |
|
|
|
14.1 |
|
|
Income from equity investments (4) |
|
— |
|
|
|
(11.6 |
) |
|
|
(0.2 |
) |
|
|
(11.6 |
) |
|
Share-based compensation |
|
34.0 |
|
|
|
26.3 |
|
|
|
126.5 |
|
|
|
113.4 |
|
|
Interest expense and interest income |
|
(8.7 |
) |
|
|
4.2 |
|
|
|
(5.2 |
) |
|
|
17.1 |
|
|
Income tax expense |
|
41.4 |
|
|
|
11.7 |
|
|
|
49.6 |
|
|
|
39.9 |
|
|
Adjusted EBITDA |
$ |
237.1 |
|
|
$ |
67.3 |
|
|
$ |
751.6 |
|
|
$ |
491.8 |
|
|
|
|
|
|
|
|
|
|
|||||||||
GAAP net income (loss) |
$ |
91.8 |
|
|
$ |
(5.3 |
) |
|
$ |
341.2 |
|
|
$ |
216.9 |
|
|
Amortization of intangible assets (1) |
|
4.2 |
|
|
|
1.4 |
|
|
|
9.9 |
|
|
|
3.7 |
|
|
Business transition and related costs (2) |
|
24.1 |
|
|
|
— |
|
|
|
39.5 |
|
|
|
— |
|
|
Intellectual property litigation costs (3) |
|
18.4 |
|
|
|
9.9 |
|
|
|
44.5 |
|
|
|
14.1 |
|
|
Income from equity investments (4) |
|
— |
|
|
|
(11.6 |
) |
|
|
(0.2 |
) |
|
|
(11.6 |
) |
|
Adjustments related to taxes (5) |
|
(2.2 |
) |
|
|
3.2 |
|
|
|
(84.9 |
) |
|
|
(28.6 |
) |
|
Non-GAAP net income (loss) |
$ |
136.3 |
|
|
$ |
(2.4 |
) |
|
$ |
350.0 |
|
|
$ |
194.5 |
|
|
|
|
|
|
|
|
|
|
|||||||||
GAAP net income (loss) |
$ |
91.8 |
|
|
$ |
(5.3 |
) |
|
$ |
341.2 |
|
|
$ |
216.9 |
|
|
Interest expense on senior convertible notes, net of tax |
|
2.8 |
|
|
|
— |
|
|
|
11.0 |
|
|
|
11.4 |
|
|
GAAP net income (loss) used for diluted EPS, if-converted (6) |
$ |
94.6 |
|
|
$ |
(5.3 |
) |
|
$ |
352.2 |
|
|
$ |
228.3 |
|
|
|
|
|
|
|
|
|
|
|||||||||
Non-GAAP net income (loss) |
$ |
136.3 |
|
|
$ |
(2.4 |
) |
|
$ |
350.0 |
|
|
$ |
194.5 |
|
|
Interest expense on senior convertible notes, net of tax |
|
1.2 |
|
|
|
— |
|
|
|
4.8 |
|
|
|
— |
|
|
Non-GAAP net income (loss) used for diluted EPS, if-converted (6) |
$ |
137.5 |
|
|
$ |
(2.4 |
) |
|
$ |
354.8 |
|
|
$ |
194.5 |
|
|
|
||||||||||||||||
Table E (Continued) |
||||||||||||||||
Itemized Reconciliation Between GAAP and Non-GAAP Financial Measures |
||||||||||||||||
(In millions, except per share data) |
||||||||||||||||
(Unaudited) |
||||||||||||||||
|
|
|
|
|
||||||||||||
|
|
Three Months Ended
|
|
Twelve Months Ended
|
||||||||||||
|
|
2022 |
|
2021 |
|
2022 |
|
2021 |
||||||||
|
|
|
|
(As Adjusted)* |
|
|
|
(As Adjusted)* |
||||||||
GAAP diluted net income (basic net loss) per share (6) |
$ |
0.22 |
|
|
$ |
(0.01 |
) |
|
$ |
0.82 |
|
|
$ |
0.53 |
|
|
Amortization of intangible assets (1) |
|
0.01 |
|
|
|
— |
|
|
|
0.02 |
|
|
|
0.01 |
|
|
Business transition and related costs (2) |
|
0.06 |
|
|
|
— |
|
|
|
0.10 |
|
|
|
— |
|
|
Intellectual property litigation costs (3) |
|
0.05 |
|
|
|
0.03 |
|
|
|
0.11 |
|
|
|
0.04 |
|
|
Income from equity investments (4) |
|
— |
|
|
|
(0.03 |
) |
|
|
— |
|
|
|
(0.03 |
) |
|
Adjustments related to taxes (5) |
|
(0.01 |
) |
|
|
0.01 |
|
|
|
(0.21 |
) |
|
|
(0.07 |
) |
|
Impact of adjustment to GAAP diluted shares (7) |
|
— |
|
|
|
— |
|
|
|
0.01 |
|
|
|
0.01 |
|
|
Non-GAAP diluted net income (basic net loss) per share (6) (8) |
$ |
0.34 |
|
|
$ |
(0.01 |
) |
|
$ |
0.87 |
|
|
$ |
0.49 |
|
|
|
|
|
|
|
|
|
|
|||||||||
GAAP diluted weighted-average shares outstanding |
|
425.9 |
|
|
|
387.8 |
|
|
|
427.5 |
|
|
|
428.8 |
|
|
Non-GAAP diluted weighted-average shares outstanding |
|
407.0 |
|
|
|
387.8 |
|
|
|
408.6 |
|
|
|
400.4 |
|
|
|
|
|
|
|
|
|
|
|||||||||
Reconciliation of non-GAAP diluted weighted-average shares outstanding: |
|
|
|
|
|
|
|
|||||||||
GAAP diluted weighted-average shares outstanding |
|
425.9 |
|
|
|
387.8 |
|
|
|
427.5 |
|
|
|
428.8 |
|
|
Adjustment for dilutive impact of senior convertible notes due 2023 (9) |
|
(18.9 |
) |
|
|
— |
|
|
|
(18.9 |
) |
|
|
(20.4 |
) |
|
Adjustment for dilutive impact of senior convertible notes due 2025 (10) |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(8.0 |
) |
|
Non-GAAP diluted weighted-average shares outstanding |
|
407.0 |
|
|
|
387.8 |
|
|
|
408.6 |
|
|
|
400.4 |
|
* |
We adjusted our 2021 amounts to reflect the simplified convertible instruments accounting guidance (ASU 2020-06), which we adopted on a full retrospective basis. The adoption eliminates the non-cash interest expense related to the conversion features of the convertible notes beginning in the first quarter of 2020. Further, beginning in the second quarter of 2022, we began including non-cash collaborative research and development fees incurred in our non-GAAP metrics. We have updated prior periods to conform to this new presentation. All periods presented have also been adjusted to reflect the four-for-one stock split. |
|
(1) |
Represents amortization of acquired intangible assets. |
|
(2) |
For the three months ended |
|
(3) |
Represents costs related to a patent infringement lawsuit. |
|
(4) |
Represents a gain from the sale of an equity investment. |
|
(5) |
For the three months ended |
|
(6) |
When our senior convertible notes are dilutive on a GAAP or non-GAAP basis, net income used for calculating GAAP and non-GAAP diluted net income per share includes an interest expense add back, net of tax, under the if-converted method. In loss periods, basic and diluted net loss per share are the same since the effect of potential common shares is anti-dilutive and therefore excluded. |
|
(7) |
The adjustment for the twelve months ended |
|
(8) |
The sum of the non-GAAP per share components may not equal the totals due to rounding. |
|
(9) |
Our 2023 senior convertible notes are dilutive on a GAAP basis for the three months ended |
|
(10) |
Our 2025 senior convertible notes are dilutive on a GAAP basis and non-GAAP basis for the three and twelve months ended |
ABOUT NON-GAAP FINANCIAL MEASURES
The accompanying press release dated
We use these non-GAAP financial measures for financial and operational decision making and as a means to evaluate period-to-period comparisons. We believe that they provide useful information about operating results, enhance the overall understanding of our operating performance and future prospects, and allow for greater transparency with respect to key metrics used by senior management in our financial and operational decision making. Our non-GAAP financial measures exclude amounts that we do not consider part of ongoing operating results when planning and forecasting and when assessing the performance of the organization and our senior management. We compute non-GAAP financial measures using the same consistent method from quarter to quarter and year to year. We may consider whether other significant items that arise in the future should be excluded from our non-GAAP financial measures.
We report non-GAAP financial measures in addition to, and not as a substitute for, or superior to, measures of financial performance prepared in accordance with Generally Accepted Accounting Principles (GAAP). These non-GAAP financial measures are not based on any comprehensive set of accounting rules or principles, differ from GAAP measures with the same names, and may differ from non-GAAP financial measures with the same or similar names that are used by other companies. We believe that non-GAAP financial measures should only be used to evaluate our results of operations in conjunction with the corresponding GAAP financial measures. We encourage investors to carefully consider our results under GAAP, as well as our supplemental non-GAAP information and the reconciliations between these presentations, to more fully understand our business.
Management believes that presentation of operating results that excludes these items provides useful supplemental information to investors and facilitates the analysis of our core operating results and comparison of operating results across reporting periods. Management also believes that this supplemental non-GAAP information is therefore useful to investors in analyzing and assessing our past and future operating performance.
Table E reconciles the non-GAAP financial measures in the press release to the most directly comparable financial measures prepared in accordance with Generally Accepted Accounting Principles (GAAP).
We exclude the following items from non-GAAP financial measures for non-GAAP gross profit, non-GAAP operating income (loss), non-GAAP net income (loss), and non-GAAP net income (loss) per share:
- Amortization of acquired intangible assets
- Business transition and related costs associated with acquisition, integration and business transition activities, including severance, relocation, consulting, leasehold exit costs, third party merger and acquisition costs, and other costs directly associated with such activities
- COVID-19 costs associated with the COVID-19 outbreak related to taking the necessary precautions for essential personnel to operate safely both in person as well as remotely. Costs incurred include items like incremental payroll costs, consulting support, IT infrastructure and facilities related costs
- Income or loss from equity investments
- Intellectual property litigation costs
- Litigation settlement costs
- Loss on extinguishment of debt associated with our senior convertible notes
- Adjustments related to taxes for the excluded items above, as well as excess benefits or tax deficiencies from stock-based compensation, and the quarterly impact of other discrete items
Adjusted EBITDA excludes non-cash operating charges for share-based compensation, depreciation and amortization as well as non-operating items such as interest income, interest expense, loss on extinguishment of debt, income and loss from equity investments, and income tax expense or benefit. For the reasons explained above, adjusted EBITDA also excludes business transition and related costs, COVID-19 costs, litigation settlement costs, and intellectual property litigation costs.
View source version on businesswire.com: https://www.businesswire.com/news/home/20230209005231/en/
INVESTOR RELATIONS CONTACT:
Vice President - Finance and Investor Relations
investor-relations@dexcom.com
(858) 203-6657
MEDIA CONTACT:
(619) 884-2118
Source:
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