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DexCom, Inc. Reports Third Quarter 2016 Financial Results

SAN DIEGO--(BUSINESS WIRE)--DexCom, Inc. (Nasdaq: DXCM) today reported its unaudited financial results as of and for the quarter ended September 30, 2016.

Third Quarter 2016 results:

Revenue grew to $148.6 million for the third quarter of 2016, an increase of 41% from the $105.2 million in revenue for the same quarter in 2015. Gross profit totaled $101.1 million for the third quarter of 2016, compared to a gross profit of $74.7 million for the same quarter in 2015. GAAP net loss was $18.8 million, or $0.22 per share for the third quarter of 2016, compared to GAAP net loss of $42.5 million, or $0.53 per share for the same quarter in 2015.

The GAAP net loss of $18.8 million for the third quarter of 2016 included $33.7 million in non-cash expenses, comprised primarily of share-based compensation, depreciation and amortization, compared to the GAAP net loss of $42.5 million for the same quarter of 2015, which included $62.1 million in non-cash expenses, comprised primarily of a $36.5 million research and development charge for the issuance of common stock related to an upfront payment associated with our Collaboration and License Agreement with Verily Life Sciences (the “Verily Collaboration Agreement”) and $22.6 million of share-based compensation.

Non-GAAP net loss was the same as GAAP net loss for the third quarter of 2016, as there were no non-cash exclusions this quarter. Non-GAAP net loss was $6.0 million, or $0.07 per basic share for the third quarter of 2015, which excludes the $36.5 million research and development charge pursuant to the Verily Collaboration Agreement. (See the table below entitled “Itemized Reconciliation Between GAAP and Non-GAAP Net Loss and Net Loss Per Share” for a reconciliation of these GAAP and Non-GAAP financial measures.)

Cost of sales increased $17.0 million to $47.5 million for the third quarter of 2016 compared to $30.5 million for the same quarter in 2015, primarily due to an increased sales volume. Research and development expense decreased by $20.9 million to $43.9 million for the third quarter of 2016 compared to $64.8 million for the third quarter of 2015. The decrease in research and development expense is primarily due to the $36.5 million non-cash charge related to the Verily Collaboration Agreement for the third quarter of 2015, partially offset by additional payroll costs and $3.1 million in additional non-cash share-based compensation for the third quarter of 2016. Selling, general and administrative expense increased by $23.4 million to $75.7 million for the third quarter of 2016 compared to $52.3 million for the third quarter of 2015, with the increase primarily due to additional payroll, marketing costs and consulting costs, and $2.2 million in additional non-cash share-based compensation. As of September 30, 2016, DexCom had $127.3 million in cash, cash equivalents and short-term marketable securities.

Statement regarding use of non-GAAP financial measures

DexCom reports non-GAAP results for net income and net income per basic share in addition to, and not as a substitute for, or superior to, financial measures calculated in accordance with GAAP. Our financial measures under GAAP include a substantial non-cash research and...


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