Insulet Reports Second Quarter 2022 Revenue Increase of 14% Year-Over-Year (18% Constant Currency¹)
Insulet Corporation (NASDAQ: PODD) reported strong Q2 2022 financial results, achieving revenue of $299.4 million, a 13.8% increase year-over-year. Total Omnipod revenue rose by 18.1% to $285.8 million, with U.S. Omnipod sales up 30.5%. However, net loss increased to $35.0 million, with an operating loss of $26.7 million. The company launched its Omnipod® 5 system in the U.S. and raised revenue growth guidance for 2022 to 14% to 17%. Challenges include a gross margin decline and a significant drop in Drug Delivery revenue by 35.5%.
- Total Omnipod revenue increased by 18.1% to $285.8 million.
- U.S. Omnipod revenue rose by 30.5% to $196.4 million.
- Successful launch of Omnipod® 5 in the U.S. through retail pharmacies.
- Raised revenue growth guidance for 2022 to 14% to 17%.
- Net loss increased to $35.0 million from $25.0 million.
- Operating loss of $26.7 million compared to prior year's operating income.
- Gross margin decreased by 580 basis points to 63.6%.
- Drug Delivery revenue fell by 35.5%.
- International Omnipod revenue dropped by 2.4%.
- Higher manufacturing costs and inflationary pressures are expected to lower operating margins.
Recently Launched
Second Quarter Financial Highlights:
-
Second quarter 2022 revenue of
, up$299.4 million 13.8% , or17.7% in constant currency1, compared to in the prior year, exceeds the guidance range of$263.2 million 12% to15% in constant currency-
Total Omnipod revenue of
, an increase of$285.8 million 18.1% , or22.3% in constant currency-
U.S. Omnipod revenue of , an increase of$196.4 million 30.5% -
International Omnipod revenue of
, a decrease of$89.4 million 2.4% , or an increase of8.9% in constant currency
-
-
Drug Delivery revenue of
, a decrease of$13.6 million 35.5%
-
Total Omnipod revenue of
-
Gross margin of
63.6% , down 580 basis points -
Operating loss of
, or (8.9)% of revenue, compared to operating income of$26.7 million , or$26.3 million 10.0% of revenue, in the prior year. Adjusted operating income1 of , or$4.0 million 1.3% , excludes of certain legal costs and$27.3 million of CEO transition costs$3.4 million -
Net loss of
, or$35.0 million per diluted share, compared to net loss of$(0.50) , or$25.0 million per diluted share, in the prior year$(0.37) -
Adjusted EBITDA1 of
, or$27.6 million 9.2% of revenue, compared to , or$52.3 million 19.9% of revenue, in the prior year
Recent Strategic Highlights:
-
Launched
U.S. full market release of the Omnipod® 5 Automated Insulin Delivery System (Omnipod 5) - now available through retail pharmacies -
Achieved record quarterly
U.S. and Total Omnipod new customer starts -
Presented new study data at the
American Diabetes Association Conference demonstrating Omnipod 5 significantly improved time in range and reduced HbA1c in children aged 2 through 5.9 years with type 1 diabetes over 12 months of use, while also reducing hypoglycemia, compared with standard therapy - Published preschool pivotal data in Diabetes Care2 that demonstrated the use of Omnipod 5 was safe, and participants experienced improved glycemic measures and reduced hypoglycemia during the study phase compared to baseline
-
Launched Omnipod DASH® in the
United Arab Emirates -
Broke ground at Insulet’s future
Malaysia manufacturing facility
(1) |
See description of non-GAAP financial measures contained in this release. |
|
(2) |
Safety and Glycemic Outcomes With a Tubeless Automated Insulin Delivery System in Very Young Children With Type 1 Diabetes: A Single-Arm Multicenter Clinical Trial; |
“Our second quarter results demonstrate continued momentum in our business and strong execution by the entire
2022 Outlook:
Revenue Guidance (in constant currency):
-
For the year ending
December 31, 2022 , the Company is raising its revenue growth guidance range to14% to17% (previously12% to16% ). Revenue growth ranges by product line are:-
Total Omnipod of
18% to21% (previously16% to20% )-
U.S. Omnipod of23% to26% (previously19% to23% ) -
International Omnipod of
9% to12% (previously9% to14% )
-
-
Drug Delivery of (40)% to (35)% (previously (35)% to (30)%)
-
Total Omnipod of
-
For the quarter ending
September 30, 2022 , the Company expects revenue growth of17% to20% . Revenue growth ranges by product line are:-
Total Omnipod of
18% to21% -
U.S. Omnipod of24% to27% -
International Omnipod of
7% to10%
-
- Drug Delivery of (14)% to (5)%
-
Total Omnipod of
Operating Margin Guidance:
For the year ending
Conference Call:
About
Non-GAAP Measures:
The Company uses the following non-GAAP financial measures:
-
Constant currency revenue growth, which represents the change in revenue between current and prior year periods using the exchange rate in effect during the applicable prior year period.
Insulet presents constant currency revenue growth because management believes it provides meaningful information regarding the Company’s results on a consistent and comparable basis. Management uses this non-GAAP financial measure, in addition to financial measures in accordance with generally accepted accounting principles inthe United States (GAAP), to evaluate the Company’s operating results. It is also one of the performance metrics that determines management incentive compensation.
-
Adjusted operating income, which represents net income (loss) plus other significant unusual items, as applicable, Adjusted EBITDA, which represents net income (loss) plus net interest expense, income tax expense (benefit), depreciation and amortization, stock-based compensation and other significant unusual items, as applicable; and Adjusted Operating Income and Adjusted EBITDA, both as a percentage of revenue.
Insulet presents these non-GAAP financial measures because management uses them as supplemental measures in assessing the Company’s operating performance, and the Company believes that they are helpful to investors, and other interested parties as measures of comparative operating performance from period to period. They also are commonly used measures in determining business value and the Company uses them internally to report results.
These non-GAAP financial measures should be considered supplemental to, and not a substitute for, the Company’s reported financial results prepared in accordance with GAAP. Furthermore, the Company’s definition of these non-GAAP measures may differ from similarly titled measures used by others. Because non-GAAP financial measures exclude the effect of items that will increase or decrease the Company’s reported results of operations,
Forward-Looking Statement:
This press release contains forward-looking statements regarding, among other things, future operating and financial performance, product success and efficacy, the outcome of studies and trials and the approval of products by regulatory bodies. These forward-looking statements are based on management’s current beliefs, assumptions and estimates and are not intended to be a guarantee of future events or performance. If management’s underlying assumptions turn out to be incorrect, or if certain risks or uncertainties materialize, actual results could vary materially from the expectations and projections expressed or implied by the forward-looking statements.
Risks and uncertainties include, but are not limited to adverse changes in general economic conditions as well as risks associated with public health crises and pandemics, such as the COVID-19 global pandemic, government actions and restrictive measures implemented in response, supply chain disruptions, delays in clinical trials, and other impacts to the business; dependence on a principal product platform; ability to maintain and grow our customer base; ability to scale the business to support revenue growth; maintenance of an effective sales force and expansion of distribution network; ability to secure and retain adequate coverage or reimbursement from third-party payors; impact of healthcare reform laws; impact of competitive products, technological change and product innovation; ability to design, develop, manufacture and commercialize future products; changes to or termination of our license to incorporate a blood glucose meter into the Omnipod System or inability to enter into new license or other agreements with respect to the Omnipod System’s current or future features; challenges to the future development of our non-insulin drug delivery product line; international business risks, including regulatory, commercial and logistics risks; supply problems or price fluctuations with sole source or third-party suppliers on which we are dependent; failure to retain key suppliers and/or supplier pricing discounts and achieve satisfactory gross margins; ability to protect our intellectual property and other proprietary rights and potential conflicts with the intellectual property of third parties; adverse regulatory or legal actions relating to the Omnipod System or future products; failure of our contract manufacturer or component suppliers to comply with the
For a further list and description of these and other important risks and uncertainties that may affect our future operations, see Part I, Item 1A - Risk Factors in our most recent Annual Report on Form 10-K filed with the
©2022
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) |
|||||||||||||||
|
Three Months Ended |
|
Six Months Ended |
||||||||||||
(dollars in millions, except per share data) |
2022 |
|
|
2021 |
|
|
2022 |
|
|
2021 |
|
||||
Revenue |
$ |
299.4 |
|
|
$ |
263.2 |
|
|
$ |
594.8 |
|
|
$ |
515.5 |
|
Cost of revenue |
|
109.1 |
|
|
|
80.5 |
|
|
|
194.8 |
|
|
|
165.3 |
|
Gross profit |
|
190.3 |
|
|
|
182.7 |
|
|
|
400.0 |
|
|
|
350.2 |
|
Research and development expenses |
|
42.6 |
|
|
|
40.1 |
|
|
|
85.7 |
|
|
|
80.8 |
|
Selling, general and administrative expenses |
|
174.4 |
|
|
|
116.3 |
|
|
|
303.1 |
|
|
|
226.8 |
|
Operating (loss) income |
|
(26.7 |
) |
|
|
26.3 |
|
|
|
11.2 |
|
|
|
42.6 |
|
Interest expense, net |
|
(8.3 |
) |
|
|
(16.4 |
) |
|
|
(17.2 |
) |
|
|
(29.8 |
) |
Loss on extinguishment of debt |
|
— |
|
|
|
(40.1 |
) |
|
|
— |
|
|
|
(40.1 |
) |
Other (expense) income, net |
|
(1.1 |
) |
|
|
1.8 |
|
|
|
(0.8 |
) |
|
|
(0.8 |
) |
Loss before income taxes |
|
(36.1 |
) |
|
|
(28.4 |
) |
|
|
(6.8 |
) |
|
|
(28.1 |
) |
Income tax benefit (expense) |
|
1.1 |
|
|
|
3.4 |
|
|
|
(0.4 |
) |
|
|
3.1 |
|
Net loss |
$ |
(35.0 |
) |
|
$ |
(25.0 |
) |
|
$ |
(7.2 |
) |
|
$ |
(25.0 |
) |
|
|
|
|
|
|
|
|
||||||||
Net loss per share: |
|
|
|
|
|
|
|
||||||||
Basic |
$ |
(0.50 |
) |
|
$ |
(0.37 |
) |
|
$ |
(0.10 |
) |
|
$ |
(0.38 |
) |
Diluted |
$ |
(0.50 |
) |
|
$ |
(0.37 |
) |
|
$ |
(0.10 |
) |
|
$ |
(0.38 |
) |
Weighted-average number of common shares outstanding (in thousands): |
|
|
|
|
|
|
|
||||||||
Basic |
|
69,356 |
|
|
|
66,696 |
|
|
|
69,305 |
|
|
|
66,406 |
|
Diluted |
|
69,356 |
|
|
|
66,696 |
|
|
|
69,305 |
|
|
|
66,406 |
|
CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED) |
|||||
(dollars in millions) |
|
|
|
||
ASSETS |
|
|
|
||
Cash and cash equivalents |
$ |
708.6 |
|
$ |
791.6 |
Accounts receivable, net |
|
206.6 |
|
|
161.0 |
Inventories |
|
320.4 |
|
|
303.2 |
Prepaid expenses and other current assets |
|
73.5 |
|
|
74.0 |
Total current assets |
|
1,309.1 |
|
|
1,329.8 |
Property, plant and equipment, net |
|
535.8 |
|
|
536.5 |
|
|
106.9 |
|
|
76.4 |
Other assets |
|
161.9 |
|
|
106.1 |
Total assets |
$ |
2,113.7 |
|
$ |
2,048.8 |
LIABILITIES AND STOCKHOLDERS’ EQUITY |
|
|
|
||
Accounts payable |
$ |
57.2 |
|
$ |
37.7 |
Accrued expenses and other current liabilities |
|
195.8 |
|
|
166.0 |
Current portion of long-term debt |
|
26.3 |
|
|
25.1 |
Total current liabilities |
|
279.3 |
|
|
228.8 |
Long-term debt, net |
|
1,385.2 |
|
|
1,248.8 |
Other liabilities |
|
26.8 |
|
|
14.9 |
Total liabilities |
|
1,691.3 |
|
|
1,492.5 |
Stockholders’ equity |
|
422.4 |
|
|
556.3 |
Total liabilities and stockholders’ equity |
$ |
2,113.7 |
|
$ |
2,048.8 |
NON-GAAP RECONCILIATIONS (UNAUDITED) CONSTANT CURRENCY REVENUE GROWTH |
||||||||||||||
|
Three Months Ended |
|
|
|
|
|
|
|||||||
(dollars in millions) |
2022 |
|
2021 |
|
Percent Change |
|
Currency Impact |
|
Constant Currency |
|||||
Revenue: |
|
|
|
|
|
|
|
|
|
|||||
|
$ |
196.4 |
|
$ |
150.5 |
|
|
|
|
|
—% |
|
|
|
International Omnipod |
|
89.4 |
|
|
91.6 |
|
|
(2.4)% |
|
(11.3)% |
|
|
|
|
Total Omnipod |
|
285.8 |
|
|
242.1 |
|
|
|
|
(4.2)% |
|
|
|
|
Drug Delivery |
|
13.6 |
|
|
21.1 |
|
|
(35.5)% |
|
—% |
|
|
(35.5)% |
|
Total |
$ |
299.4 |
|
$ |
263.2 |
|
|
|
|
(3.9)% |
|
|
|
|
Six Months Ended |
|
|
|
|
|
|
|||||||
(dollars in millions) |
2022 |
|
2021 |
|
Percent Change |
|
Currency Impact |
|
Constant Currency |
|||||
Revenue: |
|
|
|
|
|
|
|
|
|
|||||
|
$ |
370.5 |
|
$ |
293.8 |
|
|
|
|
—% |
|
|
|
|
International Omnipod |
|
184.8 |
|
|
181.5 |
|
|
|
|
(8.9)% |
|
|
|
|
Total Omnipod |
|
555.3 |
|
|
475.3 |
|
|
|
|
(3.4)% |
|
|
|
|
Drug Delivery |
|
39.5 |
|
|
40.2 |
|
|
(1.7)% |
|
—% |
|
|
(1.7)% |
|
Total |
$ |
594.8 |
|
$ |
515.5 |
|
|
|
|
(3.1)% |
|
|
|
NON-GAAP RECONCILIATIONS (UNAUDITED) |
|||||||||||||||||||||||||||
ADJUSTED EBITDA |
|||||||||||||||||||||||||||
|
Three Months Ended |
|
Six Months Ended |
||||||||||||||||||||||||
(dollars in millions) |
2022 |
|
Percent of Revenue |
|
2021 |
|
Percent of Revenue |
|
2022 |
|
Percent of Revenue |
|
2021 |
|
Percent of Revenue |
||||||||||||
Net loss |
$ |
(35.0 |
) |
|
|
(11.7)% |
|
$ |
(25.0 |
) |
|
|
(9.5)% |
|
$ |
(7.2 |
) |
|
|
(1.2)% |
|
$ |
(25.0 |
) |
|
|
(4.8)% |
Interest expense, net |
|
8.3 |
|
|
|
|
|
16.4 |
|
|
|
|
|
17.2 |
|
|
|
|
|
29.8 |
|
|
|
||||
Income tax (benefit) expense |
|
(1.1 |
) |
|
|
|
|
(3.4 |
) |
|
|
|
|
0.4 |
|
|
|
|
|
(3.1 |
) |
|
|
||||
Depreciation and amortization |
|
15.8 |
|
|
|
|
|
15.2 |
|
|
|
|
|
31.1 |
|
|
|
|
|
28.0 |
|
|
|
||||
Stock-based compensation |
|
8.9 |
|
|
|
|
|
9.0 |
|
|
|
|
|
18.4 |
|
|
|
|
|
17.6 |
|
|
|
||||
Legal costs(1) |
|
27.3 |
|
|
|
|
|
— |
|
|
|
|
|
27.3 |
|
|
|
|
|
— |
|
|
|
||||
CEO transition costs(2) |
|
3.4 |
|
|
|
|
|
— |
|
|
|
|
|
3.4 |
|
|
|
|
|
— |
|
|
|
||||
Loss on extinguishment of debt |
|
— |
|
|
|
|
|
40.1 |
|
|
|
|
|
— |
|
|
|
|
|
40.1 |
|
|
|
||||
Adjusted EBITDA |
$ |
27.6 |
|
|
|
|
|
$ |
52.3 |
|
|
|
|
|
$ |
90.6 |
|
|
|
|
|
$ |
87.4 |
|
|
|
|
ADJUSTED OPERATING INCOME |
||||||||||||
|
Three Months Ended |
|
Six Months Ended |
|||||||||
(dollars in millions) |
2022 |
|
Percent of Revenue |
|
2022 |
|
Percent of Revenue |
|||||
Operating (loss) income |
$ |
(26.7 |
) |
|
|
(8.9)% |
|
$ |
11.2 |
|
|
|
Legal costs(1) |
|
27.3 |
|
|
|
|
|
27.3 |
|
|
||
CEO transition costs(2) |
|
3.4 |
|
|
|
|
|
3.4 |
|
|
||
Adjusted operating income |
$ |
4.0 |
|
|
|
|
|
$ |
41.9 |
|
|
|
(1) |
Includes a |
|
(2) |
Represents costs associated with the retirement and advisory services of the former chief executive officer, including |
REVENUE GUIDANCE RECONCILIATIONS (UNAUDITED) |
|||||||||||||||||
|
Year Ending |
||||||||||||||||
|
Low |
|
High |
||||||||||||||
|
Revenue
GAAP |
|
Currency
|
|
Constant
|
|
Revenue
|
|
Currency
|
|
Constant
|
||||||
|
23 |
% |
|
— |
% |
|
23 |
% |
|
26 |
% |
|
— |
% |
|
26 |
% |
International Omnipod |
(2 |
)% |
|
(11 |
)% |
|
9 |
% |
|
1 |
% |
|
(11 |
)% |
|
12 |
% |
Total Omnipod |
14 |
% |
|
(4 |
)% |
|
18 |
% |
|
17 |
% |
|
(4 |
)% |
|
21 |
% |
Drug Delivery |
(40 |
)% |
|
— |
% |
|
(40 |
)% |
|
(35 |
)% |
|
— |
% |
|
(35 |
)% |
Total |
10 |
% |
|
(4 |
)% |
|
14 |
% |
|
13 |
% |
|
(4 |
)% |
|
17 |
% |
|
Three Months Ended |
||||||||||||||||
|
Low |
|
High |
||||||||||||||
|
Revenue
|
|
Currency
|
|
Constant
|
|
Revenue
|
|
Currency
|
|
Constant
|
||||||
|
24 |
% |
|
— |
% |
|
24 |
% |
|
27 |
% |
|
— |
% |
|
27 |
% |
International Omnipod |
(6 |
)% |
|
(13 |
)% |
|
7 |
% |
|
(3 |
)% |
|
(13 |
)% |
|
10 |
% |
Total Omnipod |
13 |
% |
|
(5 |
)% |
|
18 |
% |
|
16 |
% |
|
(5 |
)% |
|
21 |
% |
Drug Delivery |
(14 |
)% |
|
— |
% |
|
(14 |
)% |
|
(5 |
)% |
|
— |
% |
|
(5 |
)% |
Total |
12 |
% |
|
(5 |
)% |
|
17 |
% |
|
15 |
% |
|
(5 |
)% |
|
20 |
% |
View source version on businesswire.com: https://www.businesswire.com/news/home/20220804005019/en/
Investor Relations:
Vice President, Investor Relations
(978) 600-7717
dgordon@insulet.com
Media:
Senior Director, Corporate Communications
(978) 932-0611
awiczek@insulet.com
Source:
FAQ
What were Insulet's financial results for the second quarter of 2022?
What is the Omnipod® 5 launch news from Insulet?
How did Insulet adjust its revenue growth guidance for 2022?
What challenges did Insulet face in Q2 2022?