U.S. markets closed
  • S&P Futures

    3,603.75
    +2.25 (+0.06%)
     
  • Dow Futures

    28,876.00
    +75.00 (+0.26%)
     
  • Nasdaq Futures

    10,995.50
    -40.00 (-0.36%)
     
  • Russell 2000 Futures

    1,673.00
    +3.20 (+0.19%)
     
  • Crude Oil

    81.90
    +2.41 (+3.03%)
     
  • Gold

    1,671.70
    -0.30 (-0.02%)
     
  • Silver

    19.10
    +0.07 (+0.35%)
     
  • EUR/USD

    0.9807
    -0.0013 (-0.13%)
     
  • 10-Yr Bond

    3.8040
    +0.0570 (+1.52%)
     
  • Vix

    31.62
    -0.22 (-0.69%)
     
  • GBP/USD

    1.1167
    +0.0044 (+0.39%)
     
  • USD/JPY

    144.7600
    +0.3170 (+0.22%)
     
  • BTC-USD

    19,200.37
    -119.14 (-0.62%)
     
  • CMC Crypto 200

    443.49
    +0.06 (+0.01%)
     
  • FTSE 100

    6,893.81
    +12.22 (+0.18%)
     
  • Nikkei 225

    25,937.21
    -484.89 (-1.84%)
     

Tandem Diabetes (TNDM) Q2 Earnings Miss, Sales View Cut

·5 min read

Tandem Diabetes Care, Inc. TNDM reported GAAP loss per share of 24 cents for the second quarter of 2022 compared to earnings of 6 cents per share in the year-ago period. This figure also compared unfavorably with the Zacks Consensus Estimate of earnings of 3 cents per share.

Revenues

Revenues in the quarter came in at $200.3 million, up 16.4% year over year but missed the Zacks Consensus Estimate by 2.4%. The year-over-year growth was driven by continued strong retention of the company’s worldwide installed base, which is 40% higher than 2021, driving over half of the company’s sales from recurring revenue sources.

Quarter in Detail

Total sales in the United States came in at $145.7 millionin the quarter under review, up 14% year over year. The company registered sales of $54.6 million outside the United States, recording a 23% rise from second-quarter 2021.

U.S. pump shipments were 20,818 units, up 1% year over year. Tandem Diabetes noted that a much healthier environment in the first half of 2021 made the year-over-year comparison difficult.

Meanwhile, pump shipments outside the United States declined 14% to 11,296 pumps.

Tandem Diabetes Care, Inc. Price, Consensus and EPS Surprise

Tandem Diabetes Care, Inc. Price, Consensus and EPS Surprise
Tandem Diabetes Care, Inc. Price, Consensus and EPS Surprise

Tandem Diabetes Care, Inc. price-consensus-eps-surprise-chart | Tandem Diabetes Care, Inc. Quote

According to the company, pump shipments to distributors outside the United States were down this time as the second quarter of 2021 had the highest comp shipments ever, due to the timing of distributor orders last year. Tandem Diabetes also noted that shipments to distributors did not correlate to underlying patient demand in the reported quarter.

Margins

Gross profit in the second quarter was $101.9 million, marking 10.3% year-over-year growth. The gross margin was 50.9%, indicating a contraction of 280 basis points (bps).

Selling, general and administrative expenses rose 21.2% to $80.6 million in the quarter under review. Research and development expenses also increased 63.8% to $33.6 million.

The company registered an operating loss of $12.2 million in the second quarter, a huge slash from the year-ago operating profit of $5.4 million.

Financial Position

Tandem Diabetes exited the second quarter of 2022 with cash and cash equivalents, and short-term investments of $635.3 million compared with $635.4 million recorded at the end of the first quarter.

2022 Guidance

Tandem Diabetes has reduced its sales guidance for 2022.

For the year, sales are projected in the range of $835-$845 million (down from the prior projection of $850-$865 million), indicating annual sales growth of 19% to 20% (21% to 23% earlier). The Zacks Consensus Estimate for 2022 revenues is pegged at $855 million.

Full-year sales guidance for the United States is now in the range of $620-$625 million ($635-$645 million earlier).

The company has maintained its full-year sales guidance for outside the United States in the band of $215-$220 million.

Our Take

Tandem Diabetes exited the second quarter with lower-than-expected top-and-bottom-line figures. Although the company delivered year-over-year sales growth, U.S. and outside-U.S. pump shipments in the quarter faced the unfavorable impact of difficult year-over-year comparisons. Further, escalating costs and expenses put pressure on margins.

Factoring the pandemic and competitive pressure as well as the evolving economic environment, including inflation and the threat of recession, the company slashed its full-year guidance.

Zacks Rank and Key Picks

Tandem Diabetes currently carries a Zacks Rank #3 (Hold).

Some better-ranked stocks in the broader medical space that have announced quarterly results are Quest Diagnostics Incorporated DGX, Medpace Holdings, Inc. MEDP and Merck & Co. MRK.

Quest Diagnostics, carrying a Zacks Rank #2 (Buy), reported second-quarter 2022 adjusted EPS of $2.36, which beat the Zacks Consensus Estimate by 9.8%. Revenues of $2.45 billion outpaced the consensus mark by 7.5%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Quest Diagnostics has an earnings yield of 7.1% compared with the industry’s 3.2%. DGX’s earnings surpassed estimates in three of the trailing four quarters and missed the same in one, the average being 12.1%.

Medpace Holdings, having a Zacks Rank #2, reported second-quarter 2022 adjusted EPS of $1.46, which beat the Zacks Consensus Estimate by 8.9%. Revenues of $351.2 million outpaced the consensus mark by 1.3%.

Medpace Holdings has an estimated growth rate of 22.7% for full-year 2022. MEDP’s earnings surpassed estimates in the trailing four quarters, the average being 17.3%.

Merck reported second-quarter 2022 adjusted earnings of $1.87 per share, beating the Zacks Consensus Estimate by 11.9%. Revenues of $14.6 billion surpassed the Zacks Consensus Estimate by 5.4%. It currently has a Zacks Rank #2.

Merck has a long-term estimated growth rate of 10.1%. MRK’s earnings surpassed estimates in the trailing four quarters, the average surprise being 16.8%.


Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
 
Merck & Co., Inc. (MRK) : Free Stock Analysis Report
 
Quest Diagnostics Incorporated (DGX) : Free Stock Analysis Report
 
Tandem Diabetes Care, Inc. (TNDM) : Free Stock Analysis Report
 
Medpace Holdings, Inc. (MEDP) : Free Stock Analysis Report
 
To read this article on Zacks.com click here.
 
Zacks Investment Research