Dexcom Inc. (NASDAQ:DXCM), which makes continuous glucose monitors, posted strong revenue and earnings for its fiscal second quarter for its continuous glucose monitors.
The company reported a 34% year-over-year revenue jump in the second quarter to $452 million. Adjusted earnings came in at $77 million, up 34 percent from the same quarter last year.
Both revenue and adjusted earnings beat Wall Street analysts’ expectations of $416 million in sales and 34 cents per share in adjusted earnings.
Navigating the Pandemic
Kevin Sayer, chairman, president and CEO of Dexcom said the company entered the second quarter of 2020 with several areas of uncertainty as COVID-19 quickly spread.
In April, the San Diego company saw a slowdown in patients signing up for its continuous glucose monitors, however, by May and June demand quickly picked back up.
“We established three pillars for our organization to help guide us through the pandemic: 1) to ensure the safety of our employees, 2) to maintain service continuity for our customers who rely on Dexcom CGM, and 3) to do our part to assist our communities as we address this novel virus,” said Sayer. “We are executing well on all three of these measures, and the results are indicated in our financial and operational performance this year.”
Founded in 1999, San Diego-based Dexcom is a maker of continuous blood glucose monitors. Its devices can deliver real-time blood sugar readings to either a handheld reader or smartphone without finger pricks.
The advantage of continuous glucose monitors (CGMs) is not only convenience but better control of glucose levels around the clock, as a result, bringing better health for diabetes patients.
Increasingly, insurers are covering the use of glucose monitors for people with Type 2 diabetes, who often rely on diet, exercise and medications to control blood sugar.
Highly satisfied customers and continued new patient growth are driving sales for Dexcom’s G6 CGM system, according to the company.
“The remote monitoring and glucose data sharing capabilities of CGM have played a vital role in the adoption of telemedicine by people with diabetes during the pandemic and our continued new patient growth reflects the overall momentum behind real-time CGM in both the Type 1 and Type 2 patient populations,” said Sayer.
In May, Dexcom received federal approval to use its G6 continuous glucose monitors in hospitals for COVID-19 patients, as people with diabetes are at higher risk of complications from the virus.
UnitedHealthcare recently announced plans to provide a Dexcom G6 continuous glucose monitor to 230,000 employer-sponsored insurance members with Type 2 diabetes at no additional cost as part of a pilot program to manage the disease.
Competition is growing in the market for continuous glucose monitors, with companies such Abbott Laboratories and Medtronic rolling out new glucose monitors each year.
However, the additional competition has helped raise awareness of these devices among people with diabetes, where spikes or falls in blood sugar levels can result in serious medical complications.
Next year, Dexcom will unveil its next-generation CGM, the G7, which should give its financial results another boost.
With the rebound in new patients, Dexcom increased its full-year revenue forecast to $1.85 billion, up from about $1.75 billion previously. Dexcom’s shares are up 97 percent so far in 2020.