Dexcom Reports Preliminary, Unaudited Results for the Fourth Quarter and Fiscal Year 2024 and Initial 2025 Outlook

Rhea-AI Summary

DexCom (DXCM) has announced preliminary Q4 2024 results with total revenue of at least $1.113 billion, up 8% year-over-year. U.S. revenue reached approximately $803 million (4% growth), while international revenue hit $310 million (17% growth).

Full-year 2024 preliminary revenue totaled $4.032 billion, representing an 11% increase from 2023. The company updated its 2024 guidance, projecting non-GAAP gross profit margin of 62% and operating margin of 19%. Q4 gross margin was negatively impacted by inventory damage during transit and production yield issues.

Looking ahead to 2025, DexCom expects revenue of $4.60 billion, targeting 14% growth. The company forecasts 2025 non-GAAP gross profit margin of 64-65% and operating margin of 21%. Growth drivers include increased CGM access, Stelo rollout, and international expansion.

Positive

• Q4 2024 revenue grew 8% YoY to $1.113 billion
• International revenue increased 17% YoY to $310 million
• Full-year 2024 revenue up 11% to $4.032 billion
• Projected 14% revenue growth for 2025
• Expected improvement in 2025 margins (gross profit 64-65%, operating 21%)

Negative

• U.S. revenue growth slowed to 4% YoY
• Q4 gross margin impacted by inventory damage and production yield issues
• 2024 gross profit margin guidance lowered to 62%

Insights

Financial Analyst

The Q4 2024 preliminary results reveal a complex financial picture for Dexcom. With total revenue of $1.113 billion representing 8% growth, the company shows moderate expansion but falls short of historical growth rates. The U.S. market's modest 4% growth indicates potential market saturation, while international markets demonstrate robust 17% growth, highlighting successful geographical expansion.

The inventory damage and production yield issues impacting Q4 gross margins raise operational efficiency concerns. However, the projected 2025 revenue of $4.60 billion with 14% growth suggests management's confidence in market expansion. The anticipated improvement in non-GAAP gross margins to 64-65% and operating margins to 21% indicates expected operational optimization.

For investors, the key metrics paint a picture of a company transitioning from high-growth to sustainable growth phase. The focus on international expansion and new product rollouts (Stelo) represents strategic diversification, though U.S. market deceleration warrants attention.

Market Research Analyst

The CGM market dynamics reflected in these results highlight shifting competitive landscapes. Dexcom's strategic focus on Stelo rollout and international markets demonstrates adaptability to evolving market conditions. The 17% international growth versus 4% U.S. growth underscores a important market penetration strategy, particularly in untapped regions.

The emphasis on "increasing CGM access and awareness" suggests potential market expansion beyond traditional Type 1 diabetes users into broader demographics. This aligns with industry trends toward preventive healthcare and continuous monitoring. The company's investment in advocacy for greater CGM access could significantly impact market penetration rates, especially in regions with developing healthcare infrastructure.

Operations Expert

The reported inventory damage and production yield issues signal operational challenges that require immediate attention. Such non-cash charges typically indicate systemic problems in supply chain management or manufacturing processes. The projected improvement in non-GAAP gross margins from 62% in 2024 to 64-65% in 2025 suggests planned operational efficiencies, possibly through automation or supply chain optimization.

The 14% projected revenue growth for 2025 will require robust operational scaling, particularly in international markets where logistics complexities are greater. The improvement in operating margins to 21% indicates expected economies of scale, though execution risks remain given recent operational challenges.

SAN DIEGO--(BUSINESS WIRE)-- DexCom, Inc. (Nasdaq: DXCM) today reported preliminary, unaudited results for the fourth quarter ended December 31, 2024 with total revenue of at least $1.113 billion, an increase of 8% over the fourth quarter of 2023. U.S. revenue is expected to be approximately $803 million, representing growth of 4% over the fourth quarter of 2023. International revenue is expected to be approximately $310 million, an increase of 17% over the fourth quarter of 2023.

For fiscal 2024, total preliminary, unaudited revenue is approximately $4.032 billion, an increase of 11% over 2023. In conjunction with the preliminary fourth quarter results, the company is also updating 2024 non-GAAP gross profit margin and non-GAAP operating margin guidance to 62% and 19% respectively. Fourth quarter gross margin is expected to be adversely impacted by a non-cash charge primarily related to inventory damaged in transit and certain build configurations that lowered production yield for the quarter.

“Dexcom made key strategic investments in 2024 that steadily progressed throughout the year, leaving us well positioned to capitalize on our growth opportunity ahead,” said Kevin Sayer, Dexcom’s chairman, president and CEO. “We plan to build on these investments in 2025 by further enhancing our differentiated product portfolio and advocating for greater CGM access globally.”

2025 Outlook

For 2025, Dexcom currently anticipates total revenue of $4.60 billion, representing expected growth of approximately 14% over 2024. This outlook considers sensor volume growth driven by increasing CGM access and awareness for people with diabetes, the continued rollout of Stelo, further international expansion, and overall market dynamics.

In addition, Dexcom currently estimates 2025 Non-GAAP Gross Profit Margin and Non-GAAP Operating Margin to be at the following levels:

• Non-GAAP Gross Profit Margin of approximately 64 – 65%
• Non-GAAP Operating Margin of approximately 21%

Fourth Quarter 2024 Financial Results Conference Call

Dexcom will report its audited full fourth quarter and fiscal 2024 financial results on Thursday, February 13, 2025 after the close of market. Management is currently scheduled to host a conference call at 4:30 p.m. (Eastern Time) that day. More details will be provided later.

About DexCom, Inc.

Dexcom empowers people to take control of health through innovative biosensing technology. Founded in 1999, Dexcom has pioneered and set the standard in glucose biosensing for more than 25 years. Its technology has transformed how people manage diabetes and track their glucose, helping them feel more in control and live more confidently.

Dexcom. Discover what you’re made of. For more information, visit www.dexcom.com.

Category: IR

Statement Regarding Use of Non-GAAP Financial Measures

This press release includes non-GAAP financial measures. We have not reconciled our Non-GAAP Gross Profit Margin and Non-GAAP Operating Margin guidance for fiscal years 2024 and 2025 because certain items that impact these figures are uncertain or out of our control and cannot be reasonably predicted. Accordingly, a reconciliation of Non-GAAP Gross Profit Margin and Non-GAAP Operating Margin is not available without unreasonable effort.

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 preliminary, unaudited revenue for the fourth quarter of and the full fiscal year 2024, including growth rates; total revenue guidance for fiscal 2025; Non-GAAP Gross Profit Margin and Non-GAAP Operating Margin guidance for fiscal 2024 and 2025, including expected growth rates; and potential strategic and business opportunities. All forward-looking statements included in this press release are made as of the date of this release, based on information currently available to Dexcom as of the date hereof. Forward-looking statements deal with future events and therefore are subject to various risks and uncertainties. Actual results could differ materially from those anticipated in these forward-looking statements. The risks and uncertainties that may cause actual results to differ materially from Dexcom’s current expectations are more fully described in the sections titled “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Dexcom’s most recently filed periodic reports on Form 10-K and Form 10-Q and subsequent filings. Except as required by law, Dexcom assumes no obligation to update any such forward-looking statement after the date of this communication or to conform these forward-looking statements to actual results.

Dexcom, Dexcom Clarity, Dexcom Follow, Dexcom One, Dexcom Share, Stelo, and any related logos and design marks are either registered trademarks or trademarks of Dexcom, Inc. in the United States and/or other countries.

View source version on businesswire.com: https://www.businesswire.com/news/home/20250113099496/en/

FOR MORE INFORMATION:

Sean Christensen

Vice President, Finance and Investor Relations

(858) 203-6657

www.dexcom.com

Source: DexCom, Inc.

FAQ

What was DexCom's (DXCM) Q4 2024 revenue growth?

DexCom's Q4 2024 revenue grew 8% year-over-year to $1.113 billion.

How much revenue does DXCM expect for 2025?

DexCom expects total revenue of $4.60 billion for 2025, representing approximately 14% growth over 2024.

What affected DXCM's Q4 2024 gross margin?

DexCom's Q4 gross margin was negatively impacted by inventory damage during transit and production yield issues.

What are DXCM's margin projections for 2025?

DexCom projects non-GAAP gross profit margin of 64-65% and operating margin of 21% for 2025.

How did DXCM's international revenue perform in Q4 2024?

DexCom's international revenue grew 17% year-over-year to approximately $310 million in Q4 2024.