Insulet Peer Tandem Diabetes Underwhelming Earnings, Dull Outlook Drags Stock

Tandem Diabetes Care Inc.’s (NASDAQ:TNDM) stock plunged on Thursday after the company cut its annual guidance.

The diabetes-focused company reported adjusted loss of 78 cents per share, missing the consensus loss of 40 cents.

Tandem reported sales of $240.678 million, up 8% year over year, beating the consensus of $238.57 million.

Shipments in the United States grew to approximately 21,000 pumps. Shipments outside the United States were approximately 9,000 pumps.

Also Read: Goldman Sachs Bullish On Dexcom And Insulet As Diabetes Tech Surges

Outlook

Tandem Diabetes narrowed fiscal 2025 sales guidance from $997 million-$1.01 billion to $1 billion compared to the consensus of $1.004 billion.

“Our narrowed guidance reflects insights gained in the first half of the year, including our U.S. growth expectations as we progress our commercial transformation, increased benefit from accelerated pharmacy channel initiatives, and greater contributions from international sales,” said Leigh Vosseller, executive vice president and CFO.

Updated guidance includes sales in the United States of approximately $700 million.

Sales outside the United States of approximately $300 million reflect a $10 million headwind associated with the company’s preparation for direct commercial operations in select countries.

Gross margin is estimated to be 53% to 54% of sales for the full year.

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Adjusted EBITDA margin is being recast from approximately 3% to approximately negative 5% of sales for the full year, which has been updated to include a negative 8 percentage point impact for an acquired in-process research and development charge that occurred in the first quarter of 2025.

Medical Device Correction

On Thursday, Tandem Diabetes also announced a voluntary medical device correction for select t:slim X2 insulin pumps to address a potential speaker-related issue that can trigger an error resulting in a discontinuation of insulin delivery.

The error, which appears as a Malfunction 16 alarm to the user, will stop insulin delivery and terminate communication between the insulin pump and the continuous glucose monitoring (CGM) device.

If not addressed, this could result in hyperglycemia due to discontinuation of insulin delivery, real-time CGM Estimated Glucose Values, and CGM trends.

There have been 700 confirmed adverse events, defined as a confirmed high blood sugar and/or an event requiring medical intervention, and 59 reported injuries. No deaths have been reported.

Analyst Reaction

Piper Sandler downgrades Tandem Diabetes Care from Overweight to Neutral and lowers the price forecast from $30 to $14.

Wells Fargo maintains Tandem with an Equal-Weight, lowering the price forecast from $20 to $13.

RBC Capital maintains Tandem Diabetes with an Outperform, lowering the price forecast from $45 to $25.

Price Action: TNDM stock is down 21.2% at $11.34 at the last check on Thursday.

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