DexCom’s second quarter 2025 results saw the company surpass Wall Street’s revenue and earnings expectations, though the market’s immediate reaction was notably negative. Management attributed the quarter’s strong performance to sustained demand from both new and existing customers, with particular momentum among the type 2 non-insulin diabetes population. CEO Kevin Sayer emphasized DexCom’s expanding coverage through the three largest pharmacy benefit managers (PBMs), which now provides reimbursement for nearly 6 million type 2 non-insulin lives this year. The company also pointed to operational investments aimed at restoring inventory levels and supporting customer supply, as well as continued momentum in international markets, especially with DexCom ONE+. Collectively, these factors illustrate DexCom’s ability to drive growth through access expansion, operational execution, and product innovation.
Is now the time to buy DXCM? Find out in our full research report (it’s free).
DexCom (DXCM) Q2 CY2025 Highlights:
- Revenue: $1.16 billion vs analyst estimates of $1.13 billion (15.2% year-on-year growth, 2.8% beat)
- Adjusted EPS: $0.48 vs analyst estimates of $0.45 (7.8% beat)
- Adjusted EBITDA: $327.6 million vs analyst estimates of $314.6 million (28.3% margin, 4.1% beat)
- The company slightly lifted its revenue guidance for the full year to $4.61 billion at the midpoint from $4.6 billion
- Operating Margin: 18.4%, up from 15.7% in the same quarter last year
- Organic Revenue rose 14.6% year on year vs analyst estimates of 12.8% growth (182.3 basis point beat)
- Market Capitalization: $31.44 billion
While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.
Our Top 5 Analyst Questions From DexCom’s Q2 Earnings Call
- Travis Lee Steed (Bank of America) asked about the factors supporting raised guidance, and CFO Jereme Sylvain cited strong new starts in type 2 non-insulin users and expanding PBM coverage as key drivers for confidence in higher full-year targets.
- Lawrence H. Biegelsen (Wells Fargo) pressed on the risks of CMS competitive bidding for Medicare, with President Jake Leach explaining that 15% of DexCom’s business is Medicare fee-for-service and emphasizing the company’s focus on preventing service disruption and closely monitoring proposal developments.
- Robert Justin Marcus (JPMorgan) inquired about gross margin trends, and Sylvain pointed to sequential improvements expected from rebuilding inventory and more efficient distribution, while noting one-time impacts from a product recall in Q2.
- Joanne Karen Wuensch (Citibank) asked about the G8 sensor roadmap and competitive multi-analyte sensors, with Leach highlighting DexCom’s ongoing development focused on reliability and user safety, and confirming that a ketone sensor remains in the pipeline.
- Danielle Joy Antalffy (UBS) questioned competitive dynamics in the type 1 segment, with Sayer and Leach emphasizing DexCom’s established ecosystem and ongoing feature enhancements as key differentiators.
Catalysts in Upcoming Quarters
In the coming quarters, analysts will closely monitor (1) the commercial launch and adoption trajectory of the 15-day G7 sensor, (2) further expansion of PBM and international reimbursement for both prescription and over-the-counter CGM solutions, and (3) the impact of new software features and digital health integrations on patient engagement and utilization. Notably, leadership succession and any potential shifts in strategic priorities as Jake Leach prepares to assume the CEO role at the beginning of 2026 will also be under scrutiny. The ability to execute on these fronts will be critical to DexCom’s growth prospects and market positioning.
DexCom currently trades at $80.16, down from $89.11 just before the earnings. In the wake of this quarter, is it a buy or sell? Find out in our full research report (it’s free).
Our Favorite Stocks Right Now
Donald Trump’s April 2025 "Liberation Day" tariffs sent markets into a tailspin, but stocks have since rebounded strongly, proving that knee-jerk reactions often create the best buying opportunities.
The smart money is already positioning for the next leg up. Don’t miss out on the recovery - check out our Top 5 Growth Stocks for this month. This is a curated list of our High Quality stocks that have generated a market-beating return of 183% over the last five years (as of March 31st 2025).
Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 2025) as well as under-the-radar businesses like the once-small-cap company Exlservice (+354% five-year return). Find your next big winner with StockStory today.
StockStory is growing and hiring equity analyst and marketing roles. Are you a 0 to 1 builder passionate about the markets and AI? See the open roles here.
