DexCom Q1 Earnings Beat Sets Stage For Upcoming Catalysts During 2023, Analyst Says

DexCom Inc DXCM raised its 2023 financial guidance following strong Q1 FY23 financial results. It posted Q1 sales of $741.50 million, up 18% Y/Y (19% organic basis), beating the consensus of $720.74 million.

Volume growth, in conjunction with strong new customer additions, continues to be the primary driver of revenue growth.

Highlights in the quarter included the U.S. launch of the next-generation Dexcom G7 CGM, initiated with a Super Bowl commercial. The company also finalized coverage for G7 with the Centers for Medicare and Medicaid Services (CMS) in February. 

Earlier this month, the company got a boost from new CMS changes that expanded access to CGMs.

DexCom reported adjusted EPS of $0.17, up from $0.08 a year ago, beating the consensus of $0.15.

“Dexcom is off to a great start in 2023, executing on several key initiatives, including the launch of Dexcom G7 in the United States,” said Dexcom chair, president & CEO Kevin Sayer. 

“Given the strength of our first quarter results and an expanding market opportunity with new CGM coverage now available, we are pleased to raise our 2023 revenue guidance.”

Dexcom projects FY23 sales of $3.4-$3.515 billion, up from the previous guidance of $3.35-$3.49 billion compared to the consensus of $3.47 billion.

Analyst View: William Blair writes that investors should be patient and focus on the several incremental updates that encouraged the analyst on the outlook for the year.

DexCom is well positioned for durable long-term growth with upcoming new products and TAM expansion opportunities. The analyst keeps the Outperform rating.

Price Action: DXCM closed 1.09% higher at $124.93 during after-hours trading on Thursday.