Insulet Reports Second Quarter 2024 Revenue Increase of 23% Year-Over-Year
Raising Full Year Revenue, Gross Margin and Operating Margin Guidance
Second Quarter Financial Highlights:
-
Second quarter 2024 revenue of
$488.5 million , up 23.2%, or 23.4% in constant currency1, compared to$396.5 million in the prior year, exceeds the high end of the Company's guidance range of 18% in constant currency due to revenue outperformance for all product lines-
Total Omnipod revenue of
$480.4 million , an increase of 26.3%, or 26.5% in constant currencyU.S. Omnipod revenue of$352.3 million , an increase of 27.3%-
International Omnipod revenue of
$128.1 million , an increase of 23.5%, or 24.4% in constant currency
-
Drug Delivery revenue of
$8.1 million , a decrease of$7.9 million .
-
Total Omnipod revenue of
-
Gross margin of 67.7%, up 90 basis points, compared to gross margin of 66.8% in the prior year. Gross margin for the current period includes a charge of
$13.5 million relating to certain inventory components which the Company expects will not be utilized. This charge negatively impacted gross margin by 280 basis points -
Operating income of
$54.6 million , or 11.2% of revenue, up 340 basis points, compared to operating income of$31.1 million , or 7.8% of revenue, in the prior year. Operating income for the current period includes the$13.5 million charge noted above, which negatively impacted operating margin by 280 basis points -
Net income of
$188.6 million , or$2.59 per diluted share, compared to net income of$27.3 million , or$0.39 per diluted share, in the prior year. Adjusted net income1 of$38.3 million , or$0.55 per diluted share, excludes$151.7 million of income resulting from the release of the majority of the Company’s valuation allowance and a$1.4 million loss associated with an investment -
Adjusted EBITDA1 of
$90.8 million , or 18.6% of revenue, up 310 basis points, compared to$61.3 million , or 15.5% of revenue, in the prior year
Recent Strategic Highlights:
-
U.S. commercial launches:- Full market release of Omnipod 5 integrated with Dexcom’s G7 sensor
- Limited market release of the Omnipod 5 App for iPhone
-
International commercial launches:
-
Full market releases of Omnipod 5 integrated with Dexcom’s G6 sensor in
the Netherlands andFrance (also available in theU.K. andGermany ) -
Full market releases of Omnipod 5 with Abbott’s Freestyle Libre 2 Plus sensor in the
U.K. andNetherlands ; now offering “Sensor of Choice” in these regions
-
Full market releases of Omnipod 5 integrated with Dexcom’s G6 sensor in
-
Presented data at the
American Diabetes Association (ADA) Scientific Session from the Company’s SECURE-T2D pivotal trial, the largest, longest and most racially diverse study of AID conducted in people with type 2 diabetes. The data demonstrate Omnipod 5 improves clinical outcomes and quality of life in people with type 2 diabetes - Submitted 510(k) to the FDA for Omnipod 5 type 2 diabetes label expansion2
-
Began producing sellable product at the Company’s new manufacturing facility in
Malaysia
“2024 is shaping up to be another year of rapid growth, fueled by strong Omnipod 5 demand and our accelerating pace of product innovation,” said
___________________________ |
1 See description of non-GAAP financial measures contained in this release. |
2 The Omnipod 5 Automated Insulin Delivery System is not indicated for use for people with type 2 diabetes. CAUTION: Investigational device. Limited by Federal law to investigational use. |
2024 Outlook:
Revenue Guidance (in constant currency):
-
For the year ending
December 31, 2024 , the Company is raising its expected revenue growth to a range of 16% to 19% (previously 14% to 18%). Revenue growth ranges by product line are:-
Total Omnipod of 18% to 21% (previously 15% to 19%)
U.S. Omnipod of 18% to 21% (previously 17% to 21%)- International Omnipod of 18% to 21% (previously 12% to 15%)
- Drug Delivery of (50)% to (40)% (previously (60)% to (50)%)
-
Total Omnipod of 18% to 21% (previously 15% to 19%)
-
For the quarter ending
September 30, 2024 , the Company expects revenue growth of 18% to 21%. Revenue growth ranges by product line are:-
Total Omnipod of 21% to 24%
U.S. Omnipod of 21% to 24%- International Omnipod of 21% to 24%
-
Drug Delivery of (70)% to (65)% (approximately
$3 million to$4 million )
-
Total Omnipod of 21% to 24%
Gross Margin and Operating Margin Guidance:
For the year ending
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 gross margin, adjusted gross margin as a percentage of revenue, adjusted operating income, adjusted operating income as a percentage of revenue, adjusted net income, and adjusted diluted earnings per share exclude the impact of certain significant transactions or events, such as legal settlements, medical device corrections, gains (losses) on investments and loss on extinguishment of debt, that affect the period-to-period comparability of the Company’s performance, as applicable.
- Adjusted EBITDA, which represents net income plus net interest expense, income tax expense, depreciation and amortization, stock-based compensation expense and other significant transactions or events, such as legal settlements, medical device corrections, gains (losses) on investments and loss on extinguishment of debt, that affect the period-to-period comparability of the Company’s performance, as applicable, and adjusted EBITDA as a percentage of revenue.
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 our dependence on a principal product platform; the impact of competitive products, technological change and product innovation; our ability to maintain an effective sales force and expand our distribution network; our ability to maintain and grow our customer base; our ability to scale the business to support revenue growth; our ability to secure and retain adequate coverage or reimbursement from third-party payors; the impact of healthcare reform laws; our ability to design, develop, manufacture and commercialize future products; unfavorable results of clinical studies, including issues with third parties conducting any studies, or future publication of articles or announcement of positions by diabetes associations or other organizations that are unfavorable; our ability to protect intellectual property and other proprietary rights; potential conflicts with the intellectual property of third parties; our inability to maintain or enter into new license or other agreements with respect to continuous glucose monitors, data management systems or other rights necessary to sell our current product and/or commercialize future products; worldwide macroeconomic and geopolitical uncertainty as well as risks associated with public health crises and pandemics, including government actions and restrictive measures implemented in response, supply chain disruptions, delays in clinical trials, and other impacts to the business, our customers, suppliers, and employees; international business risks, including regulatory, commercial and logistics risks; the potential violation of anti-bribery/anti-corruption laws; the concentration of manufacturing operations and storage of inventory in a limited number of locations; supply problems or price fluctuations with sole source or third-party suppliers on which we are dependent; failure to retain key suppliers or other manufacturing issues; challenges to the future development of our non-insulin drug delivery product line; 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
©2024
|
|||||||||||
CONDENSED CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED) |
|||||||||||
|
Three Months Ended |
|
Six Months Ended |
||||||||
(dollars in millions, except per share data) |
|
2024 |
|
|
2023 |
|
|
2024 |
|
|
2023 |
Revenue |
$ |
488.5 |
|
$ |
396.5 |
|
$ |
930.2 |
|
$ |
754.6 |
Cost of revenue |
|
157.6 |
|
|
131.6 |
|
|
292.5 |
|
|
249.2 |
Gross profit |
|
330.9 |
|
|
264.9 |
|
|
637.7 |
|
|
505.4 |
Research and development expenses |
|
53.9 |
|
|
55.1 |
|
|
104.1 |
|
|
105.2 |
Selling, general and administrative expenses |
|
222.4 |
|
|
178.7 |
|
|
422.1 |
|
|
341.4 |
Operating income |
|
54.6 |
|
|
31.1 |
|
|
111.5 |
|
|
58.8 |
Interest expense, net |
|
(1.7) |
|
|
(2.4) |
|
|
(3.0) |
|
|
(5.3) |
Other expense, net |
|
(1.8) |
|
|
(0.2) |
|
|
(2.5) |
|
|
(0.4) |
Income before income taxes |
|
51.1 |
|
|
28.5 |
|
|
106.0 |
|
|
53.1 |
Income tax benefit (expense) |
|
137.5 |
|
|
(1.2) |
|
|
134.1 |
|
|
(2.0) |
Net income |
$ |
188.6 |
|
$ |
27.3 |
|
$ |
240.1 |
|
$ |
51.1 |
|
|
|
|
|
|
|
|
||||
Earnings per share: |
|
|
|
|
|
|
|
||||
Basic |
$ |
2.69 |
|
$ |
0.39 |
|
$ |
3.43 |
|
$ |
0.73 |
Diluted |
$ |
2.59 |
|
$ |
0.39 |
|
$ |
3.32 |
|
$ |
0.73 |
Weighted-average number of common shares outstanding (in thousands): |
|
|
|
|
|
|
|
||||
Basic |
|
70,062 |
|
|
69,741 |
|
|
70,010 |
|
|
69,662 |
Diluted |
|
73,802 |
|
|
70,142 |
|
|
73,771 |
|
|
70,119 |
RECONCILIATION OF DILUTED NET INCOME (UNAUDITED) |
|||||||||||
|
Three Months Ended |
|
Six Months Ended |
||||||||
(in millions, except share and per share data) |
|
2024 |
|
|
2023 |
|
|
2024 |
|
|
2023 |
Net income |
$ |
188.6 |
|
$ |
27.3 |
|
$ |
240.1 |
|
$ |
51.1 |
Add back interest expense, net of tax attributable to assumed
|
|
2.5 |
|
|
— |
|
|
4.9 |
|
|
— |
Net income, diluted |
$ |
191.1 |
|
$ |
27.3 |
|
$ |
245.0 |
|
$ |
51.1 |
|
|||||
CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED) |
|||||
(dollars in millions) |
|
|
|
||
ASSETS |
|
|
|
||
Cash and cash equivalents |
$ |
821.0 |
|
$ |
704.2 |
Accounts receivable, net |
|
348.6 |
|
|
359.7 |
Inventories |
|
430.9 |
|
|
402.6 |
Prepaid expenses and other current assets |
|
148.3 |
|
|
116.4 |
Total current assets |
|
1,748.8 |
|
|
1,582.9 |
Property, plant and equipment, net |
|
677.9 |
|
|
664.9 |
|
|
150.2 |
|
|
150.4 |
Deferred tax assets |
|
141.1 |
|
|
1.8 |
Other assets |
|
163.6 |
|
|
188.2 |
Total assets |
$ |
2,881.6 |
|
$ |
2,588.2 |
LIABILITIES AND STOCKHOLDERS’ EQUITY |
|
|
|
||
Accounts payable |
$ |
76.8 |
|
$ |
19.2 |
Accrued expenses and other current liabilities |
|
371.3 |
|
|
382.6 |
Current portion of long-term debt |
|
37.9 |
|
|
49.4 |
Total current liabilities |
|
486.0 |
|
|
451.2 |
Long-term debt, net |
|
1,359.9 |
|
|
1,366.4 |
Other liabilities |
|
37.3 |
|
|
37.9 |
Total liabilities |
|
1,883.2 |
|
|
1,855.5 |
Stockholders’ equity |
|
998.4 |
|
|
732.7 |
Total liabilities and stockholders’ equity |
$ |
2,881.6 |
|
$ |
2,588.2 |
|
||||||||||||||
NON-GAAP RECONCILIATIONS (UNAUDITED) |
||||||||||||||
CONSTANT CURRENCY REVENUE GROWTH |
||||||||||||||
|
Three Months Ended |
|
|
|
|
|
|
|||||||
(dollars in millions) |
|
2024 |
|
|
2023 |
|
Percent Change |
|
Currency
|
|
Constant
|
|||
Revenue: |
|
|
|
|
|
|
|
|
|
|||||
|
$ |
352.3 |
|
$ |
276.8 |
|
27.3 % |
|
— % |
|
27.3 % |
|||
International Omnipod |
|
128.1 |
|
|
103.7 |
|
23.5 % |
|
(0.9) % |
|
24.4 % |
|||
Total Omnipod |
|
480.4 |
|
|
380.5 |
|
26.3 % |
|
(0.2) % |
|
26.5 % |
|||
Drug Delivery |
|
8.1 |
|
|
16.0 |
|
(49.4) % |
|
— % |
|
(49.4) % |
|||
Total |
$ |
488.5 |
|
$ |
396.5 |
|
23.2 % |
|
(0.2) % |
|
23.4 % |
|
Six Months Ended |
|
|
|
|
|
|
|||||||
(dollars in millions) |
|
2024 |
|
|
2023 |
|
Percent Change |
|
Currency
|
|
Constant
|
|||
Revenue: |
|
|
|
|
|
|
|
|
|
|||||
|
$ |
670.0 |
|
$ |
535.8 |
|
25.0 % |
|
— % |
|
25.0 % |
|||
International Omnipod |
|
243.4 |
|
|
202.3 |
|
20.3 % |
|
0.6 % |
|
19.7 % |
|||
Total Omnipod |
|
913.4 |
|
|
738.1 |
|
23.8 % |
|
0.2 % |
|
23.6 % |
|||
Drug Delivery |
|
16.8 |
|
|
16.5 |
|
1.8 % |
|
— % |
|
1.8 % |
|||
Total |
$ |
930.2 |
|
$ |
754.6 |
|
23.3 % |
|
0.2 % |
|
23.1 % |
|||
|
|||||||||||
NON-GAAP RECONCILIATIONS (UNAUDITED) |
|||||||||||
ADJUSTED GROSS MARGIN, OPERATING MARGIN, NET INCOME, DILUTED EPS |
|||||||||||
|
Three Months Ended |
||||||||||
(dollars in millions) |
Income before
|
|
Net Income(3) |
|
Net Income,
|
|
Diluted Earnings
|
||||
GAAP |
$ |
51.1 |
|
$ |
188.6 |
|
$ |
191.1 |
|
$ |
2.59 |
Unrealized loss on investments(1) |
|
1.8 |
|
|
1.4 |
|
|
1.4 |
|
$ |
0.02 |
Tax matters(2) |
|
— |
|
|
(151.7) |
|
|
(151.7) |
|
$ |
(2.06) |
Non-GAAP |
$ |
52.9 |
|
$ |
38.3 |
|
$ |
40.8 |
|
$ |
0.55 |
|
Six Months Ended |
||||||||||
(dollars in millions) |
Income before
|
|
Net Income(3) |
|
Net Income,
|
|
Diluted Earnings
|
||||
GAAP |
$ |
106.0 |
|
$ |
240.1 |
|
$ |
245.0 |
|
$ |
3.32 |
Unrealized loss on investments(1) |
|
1.8 |
|
|
1.4 |
|
|
1.4 |
|
$ |
0.02 |
Tax matters(2) |
|
— |
|
|
(158.3) |
|
|
(158.3) |
|
$ |
(2.15) |
Non-GAAP |
$ |
107.8 |
|
$ |
83.2 |
|
$ |
88.1 |
|
$ |
1.19 |
|
Three Months Ended |
|||||||||||||||||||
(dollars in millions) |
Gross Profit |
|
Percent of
|
|
Operating
|
|
Percent of
|
|
Income
|
|
Net
|
|
Diluted
|
|||||||
GAAP |
$ |
264.9 |
|
66.8 % |
|
$ |
31.1 |
|
7.8 % |
|
$ |
28.5 |
|
$ |
27.3 |
|
$ |
0.39 |
||
Voluntary MDCs(4) |
|
(0.8) |
|
|
|
|
(0.8) |
|
|
|
|
(0.8) |
|
|
(0.8) |
|
$ |
(0.01) |
||
Non-GAAP |
$ |
264.1 |
|
66.6 % |
|
$ |
30.3 |
|
7.6 % |
|
$ |
27.7 |
|
$ |
26.5 |
|
$ |
0.38 |
|
Six Months Ended |
|||||||||||||||||||
(dollars in millions) |
Gross Profit |
|
Percent of
|
|
Operating
|
|
Percent of
|
|
Income
|
|
Net Income(3) |
|
Diluted
|
|||||||
GAAP |
$ |
505.4 |
|
67.0 % |
|
$ |
58.8 |
|
7.8 % |
|
$ |
53.1 |
|
$ |
51.1 |
|
$ |
0.73 |
||
Voluntary MDCs(4) |
|
(8.8) |
|
|
|
|
(8.8) |
|
|
|
|
(8.8) |
|
|
(8.8) |
|
$ |
(0.12) |
||
Non-GAAP |
$ |
496.6 |
|
65.8 % |
|
$ |
50.0 |
|
6.6 % |
|
$ |
44.3 |
|
$ |
42.3 |
|
$ |
0.60 |
(1) Represents non-operating loss resulting from the fair value adjustment of a strategic debt investment. |
(2) Includes the tax benefit of |
(3) The tax effect on non-GAAP adjustments is calculated based on the applicable local statutory tax rates, including the impact of any valuation allowance. |
(4) Represents income resulting from an adjustment to estimated costs associated with the voluntary medical device correction (“MDC”) notices issued in the fourth quarter of 2022, which is included in cost of revenue. |
|
|||||||||||||||||||||||
NON-GAAP RECONCILIATIONS (UNAUDITED) (CONTINUED) |
|||||||||||||||||||||||
ADJUSTED EBITDA |
|||||||||||||||||||||||
|
Three Months Ended |
|
Six Months Ended |
||||||||||||||||||||
(dollars in millions) |
|
2024 |
|
|
Percent of
|
|
|
2023 |
|
|
Percent of
|
|
|
2024 |
|
|
Percent of
|
|
|
2023 |
|
|
Percent of
|
Net income |
$ |
188.6 |
|
38.6 % |
|
$ |
27.3 |
|
6.9 % |
|
$ |
240.1 |
|
25.8 % |
|
$ |
51.1 |
|
6.8 % |
||||
Interest expense, net |
|
1.7 |
|
|
|
|
2.4 |
|
|
|
|
3.0 |
|
|
|
|
5.3 |
|
|
||||
Income tax (benefit) expense |
|
(137.5) |
|
|
|
|
1.2 |
|
|
|
|
(134.1) |
|
|
|
|
2.0 |
|
|
||||
Depreciation and amortization |
|
19.2 |
|
|
|
|
18.1 |
|
|
|
|
38.0 |
|
|
|
|
35.3 |
|
|
||||
Stock-based compensation expense |
|
17.0 |
|
|
|
|
13.1 |
|
|
|
|
31.2 |
|
|
|
|
25.2 |
|
|
||||
Voluntary MDCs(1) |
|
— |
|
|
|
|
(0.8) |
|
|
|
|
— |
|
|
|
|
(8.8) |
|
|
||||
Unrealized loss on investments(2) |
|
1.8 |
|
|
|
|
— |
|
|
|
|
1.8 |
|
|
|
|
— |
|
|
||||
Adjusted EBITDA |
$ |
90.8 |
|
18.6 % |
|
$ |
61.3 |
|
15.5 % |
|
$ |
180.0 |
|
19.4 % |
|
$ |
110.1 |
|
14.6 % |
(1) Represents income resulting from an adjustment to estimated costs associated with the voluntary MDC notices issued in the fourth quarter of 2022, which is included in cost of revenue. |
(2) Represents non-operating loss resulting from the fair value adjustment a of strategic debt investment. |
|
|||||
NON-GAAP RECONCILIATIONS (UNAUDITED) CONTINUED |
|||||
REVENUE GUIDANCE |
|||||
|
Year Ending |
||||
|
Revenue Growth
|
|
Currency
|
|
Constant
|
|
18% - 21% |
|
—% |
|
18% - 21% |
International Omnipod |
18% - 21% |
|
—% |
|
18% - 21% |
Total Omnipod |
18% - 21% |
|
—% |
|
18% - 21% |
Drug Delivery |
(50)% - (40)% |
|
—% |
|
(50)% - (40)% |
Total |
16% - 19% |
|
—% |
|
16% - 19% |
|
Three Months Ended |
||||
|
Revenue Growth
|
|
Currency
|
|
Constant
|
|
21% - 24% |
|
—% |
|
21% - 24% |
International Omnipod |
20% - 23% |
|
(1)% |
|
21% - 24% |
Total Omnipod |
21% - 24% |
|
—% |
|
21% - 24% |
Drug Delivery |
(70)% - (65)% |
|
—% |
|
(70)% - (65)% |
Total |
18% - 21% |
|
—% |
|
18% - 21% |
View source version on businesswire.com: https://www.businesswire.com/news/home/20240808840738/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: