Raising Full Year Revenue and Margin
Guidance
Insulet Corporation (NASDAQ: PODD) (Insulet or the Company), the
global leader in tubeless insulin pump technology with its Omnipod®
brand of products, today announced financial results for the three
months ended September 30, 2024.
“We continue to achieve significant milestones and robust
revenue growth," said Jim Hollingshead, President and Chief
Executive Officer. “Omnipod 5 is the first and only automated
insulin delivery system in the U.S. for both type 1 and type 2
diabetes, following recent FDA clearance for the type 2 label
indication. Insulet leads the industry, and Omnipod 5 is
revolutionizing diabetes care worldwide. I am proud of our team’s
daily achievements in improving health outcomes and setting new
standards in diabetes management.”
Third Quarter Financial Highlights:
- Third quarter 2024 revenue of $543.9 million, up 25.7%, or
25.4% in constant currency1, compared to $432.7 million in the
prior year, exceeds the high end of the Company’s guidance range of
21% in constant currency
- Total Omnipod revenue of $533.6 million, an increase of 26.4%,
or 26.1% in constant currency
- U.S. Omnipod revenue of $395.6 million, an increase of
23.4%
- International Omnipod revenue of $138.0 million, an increase of
36.1%, or 34.8% in constant currency
- Drug Delivery revenue of $10.3 million, consistent with prior
year
- Gross margin of 69.3%, up 150 basis points, compared to gross
margin of 67.8% in the prior year
- Operating income of $88.1 million, or 16.2% of revenue, up 350
basis points, compared to operating income of $54.8 million, or
12.7% of revenue, in the prior year
- Net income of $77.5 million, or $1.08 per diluted share,
compared to net income of $51.9 million, or $0.74 per diluted
share, in the prior year.
- Adjusted net income1 of $64.2 million, or $0.90 per diluted
share, excludes a tax benefit of $14.8 million primarily associated
with the release of the Company’s valuation allowance and a $1.5
million loss on an investment. Adjusted net income in the prior
year of $50.0 million, or $0.71 per diluted share, excludes income
of $1.9 million associated with the voluntary medical device
correction notices issued in 2022
- Adjusted EBITDA1 of $126.1 million, or 23.2% of revenue, up 410
basis points, compared to $82.8 million, or 19.1% of revenue, in
the prior year
Recent Strategic Highlights:
- Received FDA clearance for Omnipod 5 for use by the six million
people in the U.S. with type 2 diabetes2, making Omnipod 5 the
first and only automated insulin delivery system indicated for both
type 1 and type 2 diabetes
- Launched U.S. full market release of the Omnipod 5 App for
iPhone
- Omnipod named the number one insulin pump for new pump users in
Europe3
- Published results in Diabetes Care demonstrating improved
glycemic control and psychosocial outcomes in adults with type 1
diabetes compared to pump therapy with CGM.4
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 20% to 21% (previously
16% to 19%). Revenue growth ranges by product line are:
- Total Omnipod of 21% to 22% (previously 18% to 21%)
- U.S. Omnipod of 19% to 21% (previously 18% to 21%)
- International Omnipod of 25% to 27% (previously 18% to
21%)
- Drug Delivery of (10)% to (5)% (previously (50)% to (40)%)
- For the quarter ending December 31, 2024, the Company expects
revenue growth of 12% to 15%. Revenue growth ranges by product line
are:
- Total Omnipod of 13% to 16%
- U.S. Omnipod of 9% to 12%5
- International Omnipod of 30% to 33%
- Drug Delivery of (20)% to (15)% (approximately $7 million to $8
million)
Gross Margin and Operating Margin
Guidance:
For the year ending December 31, 2024, the Company now expects
gross margin to be approximately 69% (previously 68% to 69%, closer
to the high end).
For the year ending December 31, 2024, the Company is raising
its expected operating margin by 50 basis points to approximately
14.5%.
___________________________
1 See description of non-GAAP financial
measures contained in this release.
2 The expanded indication for the Omnipod
5 Automated Insulin Delivery System is for use for people with type
2 diabetes ages 18 years and older in the U.S.
3 Omnipod was the most frequently chosen
pump in the past year among people new to an insulin pump in a
survey conducted by dQ&A across Germany, Italy, France, United
Kingdom, Spain, Netherlands, Sweden. N=3646; 1H'24: P.47 (August
2024).
4 Renard E et al. Diabetes Care.2024;
47(12):1-10. https://doi.org/10.2337/dc24-1550. Results are from
Insulet’s first international randomized controlled trial of
Omnipod 5 and demonstrated a 17.5% increase in time in range in
those with high baseline A1c.
5 As previously disclosed, U.S. Omnipod
revenue in the fourth quarter of 2023 benefited from two stocking
dynamics totaling an estimated $30 million to $40 million
(impacting fourth quarter of 2024 U.S. Omnipod revenue growth by
~1,100 basis points).
Conference Call:
Insulet will host a conference call at 4:30 p.m. (Eastern Time)
on November 7, 2024 to discuss the financial results and outlook.
The link to the live call will be available on the Investor
Relations section of the Company’s website at
investors.insulet.com, “Events and Presentations,” and will be
archived for future reference. The live call may also be accessed
by dialing (888) 770-7129 for domestic callers or (929) 203-2109
for international callers, passcode 5904836.
About Insulet Corporation:
Insulet Corporation (NASDAQ: PODD), headquartered in
Massachusetts, is an innovative medical device company dedicated to
simplifying life for people with diabetes and other conditions
through its Omnipod product platform. The Omnipod Insulin
Management System provides a unique alternative to traditional
insulin delivery methods. With its simple, wearable design, the
tubeless disposable Pod provides up to three days of non-stop
insulin delivery, without the need to see or handle a needle.
Insulet’s flagship innovation, the Omnipod 5 Automated Insulin
Delivery System, is a tubeless automated insulin delivery system,
integrated with a continuous glucose monitor to manage blood sugar
with no multiple daily injections, zero fingersticks, and can be
fully controlled by a compatible personal smartphone in the U.S. or
by the Omnipod 5 Controller. Insulet also leverages the unique
design of its Pod by tailoring its Omnipod technology platform for
the delivery of non-insulin subcutaneous drugs across other
therapeutic areas. For more information, please visit insulet.com
and omnipod.com.
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 in the 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.
Insulet presents the above non-GAAP financial measures because
management uses them as supplemental measures in assessing the
Company’s performance, and the Company believes they are helpful to
investors and other interested parties as measures of comparative
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, Insulet
strongly encourages investors to review the Company’s consolidated
financial statements and publicly filed reports in their
entirety.
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
our 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 U.S. Food
and Drug Administration’s quality system regulations; extensive
government regulation applicable to medical devices as well as
complex and evolving privacy and data protection laws; adverse
regulatory or legal actions relating to current or future Omnipod
products; potential adverse impacts resulting from a recall,
discovery of serious safety issues, or product liability lawsuits
relating to off-label use; breaches or failures of our product or
information technology systems, including by cyberattack; loss of
employees or inability to identify and recruit new employees; risks
associated with potential future acquisitions or investments in new
businesses; ability to generate sufficient cash to service our
indebtedness or raise additional funds on acceptable terms or at
all; the volatility of the trading price of our common stock; risks
related to the conversion of outstanding Convertible Senior Notes;
and potential limitations on our ability to use our net operating
loss carryforwards.
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 Securities and Exchange Commission, which
we may update in Part II, Item 1A - Risk Factors in Quarterly
Reports on Form 10-Q we have filed or will file hereafter. Any
forward-looking statement made in this release speaks only as of
the date of this release. Insulet does not undertake to update any
forward-looking statement, other than as required by law.
©2024 Insulet Corporation. Omnipod is a registered trademark of
Insulet Corporation. All rights reserved. All other trademarks are
the property of their respective owners.
INSULET CORPORATION
CONDENSED CONSOLIDATED
STATEMENTS OF INCOME (UNAUDITED)
Three Months Ended
September 30,
Nine Months
Ended September 30,
(dollars in millions, except per share
data)
2024
2023
2024
2023
Revenue
$
543.9
$
432.7
$
1,474.1
$
1,187.3
Cost of revenue
166.8
139.4
459.3
388.6
Gross profit
377.1
293.3
1,014.8
798.7
Research and development expenses
54.9
57.8
159.0
163.0
Selling, general and administrative
expenses
234.1
180.7
656.2
522.1
Operating income
88.1
54.8
199.6
113.6
Interest expense, net
(1.8
)
(1.8
)
(4.8
)
(7.1
)
Other (expense) income, net
(3.4
)
0.7
(5.9
)
0.3
Income before income taxes
82.9
53.7
188.9
106.8
Income tax (expense) benefit
(5.4
)
(1.8
)
128.7
(3.8
)
Net income
$
77.5
$
51.9
$
317.6
$
103.0
Earnings per share:
Basic
$
1.11
$
0.74
$
4.53
$
1.48
Diluted
$
1.08
$
0.74
$
4.40
$
1.47
Weighted-average number of common
shares outstanding (in thousands):
Basic
70,123
69,823
70,047
69,715
Diluted
73,951
73,624
73,830
70,111
RECONCILIATION OF DILUTED NET
INCOME (UNAUDITED)
Three Months Ended
September 30,
Nine Months Ended
September 30,
(in millions, except share and per
share data)
2024
2023
2024
2023
Net income
$
77.5
$
51.9
$
317.6
$
103.0
Add back interest expense, net of tax
attributable to assumed conversion of convertible senior notes
2.3
2.5
7.1
—
Net income, diluted
$
79.8
$
54.4
$
324.7
$
103.0
INSULET CORPORATION
CONDENSED CONSOLIDATED BALANCE
SHEETS (UNAUDITED)
(dollars in millions)
September 30, 2024
December 31, 2023
ASSETS
Cash and cash equivalents
$
902.6
$
704.2
Accounts receivable, net
375.6
359.7
Inventories
444.9
402.6
Prepaid expenses and other current
assets
137.8
116.4
Total current assets
1,860.9
1,582.9
Property, plant and equipment, net
702.9
664.9
Goodwill and other intangible assets,
net
151.3
150.4
Deferred tax assets
144.4
1.8
Other assets
165.9
188.2
Total assets
$
3,025.4
$
2,588.2
LIABILITIES AND STOCKHOLDERS’
EQUITY
Accounts payable
$
40.3
$
19.2
Accrued expenses and other current
liabilities
423.9
382.6
Current portion of long-term debt
42.0
49.4
Total current liabilities
506.2
451.2
Long-term debt, net
1,356.3
1,366.4
Other liabilities
44.9
37.9
Total liabilities
1,907.4
1,855.5
Stockholders’ equity
1,118.0
732.7
Total liabilities and stockholders’
equity
$
3,025.4
$
2,588.2
INSULET CORPORATION
NON-GAAP RECONCILIATIONS
(UNAUDITED)
CONSTANT CURRENCY REVENUE
GROWTH
Three Months Ended September
30,
(dollars in millions)
2024
2023
Percent Change
Currency
Impact
Constant
Currency
Revenue:
U.S. Omnipod
$
395.6
$
320.6
23.4
%
—
%
23.4
%
International Omnipod
138.0
101.4
36.1
%
1.3
%
34.8
%
Total Omnipod
533.6
422.0
26.4
%
0.3
%
26.1
%
Drug Delivery
10.3
10.7
(3.7
)%
—
%
(3.7
)%
Total
$
543.9
$
432.7
25.7
%
0.3
%
25.4
%
Nine Months Ended September
30,
(dollars in millions)
2024
2023
Percent Change
Currency
Impact
Constant
Currency
Revenue:
U.S. Omnipod
$
1,065.6
$
856.4
24.4
%
—
%
24.4
%
International Omnipod
381.4
303.7
25.6
%
0.9
%
24.7
%
Total Omnipod
1,447.0
1,160.1
24.7
%
0.2
%
24.5
%
Drug Delivery
27.1
27.2
(0.4
)%
—
%
(0.4
)%
Total
$
1,474.1
$
1,187.3
24.2
%
0.3
%
23.9
%
INSULET CORPORATION
NON-GAAP RECONCILIATIONS
(UNAUDITED)
ADJUSTED GROSS MARGIN,
OPERATING MARGIN, NET INCOME, DILUTED EPS
Three Months Ended September
30, 2024
(dollars in millions)
Income before
Income Taxes
Net Income(3)
Net Income,
Diluted
Diluted Earnings
per Share
GAAP
$
82.9
$
77.5
$
79.8
$
1.08
Unrealized loss on investments(1)
2.0
1.5
1.5
$
0.02
Tax matters(2)
—
(14.8
)
(14.8
)
$
(0.20
)
Non-GAAP
$
84.9
$
64.2
$
66.5
$
0.90
Nine Months Ended September
30, 2024
(dollars in millions)
Income before
Income Taxes
Net Income(3)
Net Income,
Diluted
Diluted Earnings
per Share
GAAP
$
188.9
$
317.6
$
324.7
$
4.40
Unrealized loss on investments(1)
3.8
2.9
2.9
$
0.04
Tax matters(2)
—
(173.1
)
(173.1
)
$
(2.34
)
Non-GAAP
$
192.7
$
147.4
$
154.5
$
2.09
Three Months Ended September
30, 2023
(dollars in millions)
Income before
Income Taxes
Net Income(3)
Net Income,
Diluted
Diluted Earnings
per Share
GAAP
$
53.7
$
51.9
$
54.4
$
0.74
Voluntary MDCs(4)
(1.9
)
(1.9
)
(1.9
)
$
(0.03
)
Non-GAAP
$
51.8
$
50.0
$
52.5
$
0.71
Nine Months Ended September
30, 2023
(dollars in millions)
Gross Profit
Percent of
Revenue
Operating
Income
Percent of
Revenue
Income
before
Income
Taxes
Net
Income(3)
Diluted
Earnings
per Share
GAAP
$
798.7
67.3
%
$
113.6
9.6
%
$
106.8
$
103.0
$
1.47
Voluntary MDCs(4)
(10.7
)
(10.7
)
(10.7
)
(10.7
)
$
(0.15
)
Non-GAAP
$
788.0
66.4
%
$
102.9
8.7
%
$
96.1
$
92.3
$
1.32
(1)
Represents non-operating loss
resulting from the fair value adjustment of a strategic debt
investment.
(2)
Includes a tax benefit of $12.1
million and $165.6 million for the three and nine months ended
September 30, 2024, respectively, resulting from the release of the
Company’s income tax valuation allowance. Also includes a tax
benefit of $2.7 million and $7.5 million for the three and nine
months ended September 30, 2024, respectively, related to a
research and development tax credit recovery project for prior
years.
(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.
INSULET CORPORATION
NON-GAAP RECONCILIATIONS
(UNAUDITED) (CONTINUED)
ADJUSTED EBITDA
Three Months Ended September
30,
Nine Months Ended September
30,
(dollars in millions)
2024
Percent of
Revenue
2023
Percent of
Revenue
2024
Percent of
Revenue
2023
Percent of
Revenue
Net income
$
77.5
14.2
%
$
51.9
12.0
%
$
317.6
21.5
%
$
103.0
8.7
%
Interest expense, net
1.8
1.8
4.8
7.1
Income tax expense (benefit)
5.4
1.8
(128.7
)
3.8
Depreciation and amortization
21.3
18.7
59.3
54.0
Stock-based compensation expense
18.1
10.5
49.3
35.7
Voluntary MDCs(1)
—
(1.9
)
—
(10.7
)
Unrealized loss on investments(2)
2.0
—
3.8
—
Adjusted EBITDA
$
126.1
23.2
%
$
82.8
19.1
%
$
306.1
20.8
%
$
192.9
16.2
%
(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 of a strategic debt
investment.
INSULET CORPORATION
NON-GAAP RECONCILIATIONS
(UNAUDITED) CONTINUED
REVENUE GUIDANCE
Year Ending December 31,
2024
Revenue Growth
GAAP
Currency
Impact
Constant
Currency
U.S. Omnipod
19% - 21%
—%
19% - 21%
International Omnipod
26% - 28%
1%
25% - 27%
Total Omnipod
21% - 22%
—%
21% - 22%
Drug Delivery
(10)% - (5)%
—%
(10)% - (5)%
Total
20% - 21%
—%
20% - 21%
Three Months Ended December
31, 2024
Revenue Growth
GAAP
Currency
Impact
Constant
Currency
U.S. Omnipod
9% - 12%
—%
9% - 12%
International Omnipod
31% - 34%
1%
30% - 33%
Total Omnipod
13% - 16%
—%
13% - 16%
Drug Delivery
(20)% - (15)%
—%
(20)% - (15)%
Total
12% - 15%
—%
12% - 15%
View source
version on businesswire.com: https://www.businesswire.com/news/home/20241107766953/en/
Investor Relations:
Deborah R. Gordon Vice President, Investor Relations (978)
600-7717 dgordon@insulet.com
Media:
Angela Geryak Wiczek Senior Director, Corporate Communications
(978) 932-0611 awiczek@insulet.com
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