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Surpassed $1 billion in annual sales in 2025, driven by record fourth-quarter pump shipments and double-digit growth in both U.S. and international markets.
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Management is fundamentally reshaping the business model by transitioning to a ‘pay-as-you-go’ (PayGo) reimbursement structure in the pharmacy channel to reduce patient out-of-pocket barriers.
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The shift to pharmacy is expected to double the lifetime revenue per patient while streamlining the prescription process for healthcare providers and improving data visibility for payers.
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International growth was supported by record sales despite the operational complexity of transitioning to direct commercial operations in the U.K., Switzerland, and Austria.
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Operational efficiency improved significantly, with Q4 gross margins reaching a record 58% due to manufacturing efficiencies and a reduction in non-cash stock-based compensation.
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The company expanded its addressable market in 2025 by launching Control-IQ+ for type 2 diabetes and integrating with FreeStyle Libre 3 Plus for t:slim, with plans to launch Dexcom’s 15-day sensor integration in the second quarter of 2026.
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2026 guidance assumes 10% to 11% growth in U.S. pump shipments, though revenue growth will be moderated by a $70 million to $80 million pricing headwind from the PayGo transition.
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Management expects the pharmacy channel to eventually represent over 70% of U.S. shipments within 2 to 3 years, flipping the current 80% reliance on the DME channel.
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The company plans to file for FDA 510(k) clearance for Mobi Tubeless in Q2 2026, targeting a launch in the second half of the year as the world’s first patch pump with extended wear technology.
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International direct operations will expand to additional European markets in Q4 2026, with anticipated ASP premiums of at least 30% over current distributor pricing.
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Financial targets for 2026 include expanding gross margins to 56%-57% and achieving positive adjusted EBITDA of 5%-6% for the full year.
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The transition to direct international operations includes a $15 million headwind in 2026 related to distributor destocking and inventory buybacks.
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The PayGo model creates a near-term revenue ‘offset’ because pump revenue is recognized over time via supply sales rather than as a large upfront payment.
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Q1 2026 results are expected to reflect typical seasonality, including a nearly 30% decline in shipments from Q4 due to U.S. insurance deductible resets.
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Management identified the need for new physician prescriptions as a minor friction point in transitioning the existing 325,000-customer base to the pharmacy channel.
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Management stated that the transition is strategically timed to leverage recent pharmacy experience and conversations with major payers.
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The model is expected to increase lifetime patient value while significantly reducing the upfront cost barrier, which has historically hindered pump adoption.
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Management expressed confidence in double-digit renewal shipment growth for 2026, citing a ‘tail’ of customers from 2024 and 2025 who are just entering the 18-month warranty expiration window.
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The shift to pharmacy supplies will eventually reduce the company’s reliance on the 4-year pump renewal cycle for revenue stability.
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Leigh Vosseller suggested a modeling starting point of $350 per month per pharmacy customer, which is more than 4x the current DME supply reimbursement.
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The ‘payback’ period for the $0 upfront pump cost is mitigated by transitioning existing DME customers to the higher-margin pharmacy supply channel.
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