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The call emphasized strong operational and financial momentum—record shipments and sales, meaningful margin expansion, positive cash generation, a strengthened balance sheet, international go‑direct progress, and multiple product and integration milestones (Android Mobi, pregnancy clearance, FreeStyle Libre 3+ and G7 compatibility, Mobi Tubeless filing). Management acknowledged manageable near‑term headwinds from infusion set supplier shortages and the early operational friction of the PayGo pharmacy transition, plus some international timing and one‑time effects. Overall, the positive results, clear roadmap for product launches, and reaffirmed FY guidance outweigh the disclosed challenges.
Tandem reaffirmed 2026 guidance for worldwide sales of $1.065–$1.085 billion (U.S. $730–$745M; international $335–$340M) and expects Q2 worldwide sales of about $255M (Q2 U.S. ≈ $175M; Q2 international ≈ $80M), full‑year gross margins of 56–57% and adjusted EBITDA of 5–6% (Q2 margins expected consistent with Q1). The company reported Q1 records of >29,000 pump shipments and $247M in sales (U.S. >19,000 pumps, $161M; international >10,000 pumps, $86M), Q1 gross margin 55%, adjusted EBITDA ≈1%, operating margin -7%, operating expenses $154M, $5M free cash flow, $570M cash & investments and $276M net proceeds from convertible debt. Guidance assumptions/notes include international pump ASPs of $2,800–$2,900, pump shipment growth with a seasonal curve similar to 2025, ~40% pharmacy formulary coverage to date (pharmacy = 6% of U.S. sales in Q1; <5% of customers ordered pumps through pharmacy in early PayGo rollout), an estimated Q1 PayGo headwind of ~$1M, anticipated Q2 go‑direct headwinds of $3–$4M, and modest infusion‑set supply impacts.
Delivered a company first-quarter record with more than 29,000 pump shipments worldwide and $247 million in sales. U.S. shipments exceeded 19,000 (approximately +10% year‑over‑year) and U.S. sales were $161 million (+7% year‑over‑year). Renewals accounted for >50% of shipments; new starts were ~two‑thirds MDI patients.
Gross margin improved to 55% (nearly +5 percentage points year‑over‑year), the highest first‑quarter gross margin in company history. Adjusted EBITDA was ~1% of sales (benefited from a 32 percentage‑point swing tied to prior‑year IPR&D) and operating margin improved by ~40 percentage points to negative 7%.
Generated $5 million in free cash flow for the quarter and ended with $570 million in total cash and investments. Completed a convertible debt financing in February with net proceeds of $276 million (0% interest) to strengthen the balance sheet.
Launched PayGo in the pharmacy channel in March and secured ~40% formulary coverage early; pharmacy accounted for ~6% of U.S. sales in Q1. Early adoption was within company assumptions and management reaffirmed conviction in PayGo’s long‑term economics and ability to scale.
Launched direct commercial operations in the U.K., Switzerland and Austria; international shipments exceeded 10,000 pumps and international sales were $86 million (+3% year‑over‑year). Direct channel international sales increased to ~11% of international sales (from <5% historically).
Expanded Tandem Mobi to Android users in the U.S.; received FDA clearance for Control‑IQ+ in pregnant women (first and only AID cleared for pregnancy in the U.S.); Abbott FreeStyle Libre 3+ integration to begin in select European countries in Q2; Dexcom G7 15‑day compatibility updates planned; commercial rollout of Mobi outside U.S. starting in Q2.
Planning 510(k) submission for Mobi Tubeless (first Tandem tubeless pump with extended‑wear tech) in Q2 and remain on track to start the pivotal study for Tandem’s fully closed‑loop system later this year.
Reaffirming full‑year 2026 guidance: worldwide sales $1.065B–$1.085B (U.S. $730M–$745M; international $335M–$340M), expected full‑year gross margin 56%–57% and adjusted EBITDA 5%–6%.
Good day, and thank you for standing by. Welcome to the Tandem Diabetes Care, Inc. First Quarter 2026 Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speakers' presentation, there will be a question-and-answer session. You will then hear an automated message advising your hand is raised. To withdraw your question, please press 11 again. Please be advised that today’s conference is being recorded.
I would now like to hand the conference over to your speaker today, Susan Morrison, Executive Vice President and Chief Administrative Officer. Ma’am, please go ahead.
Hello, and welcome to Tandem Diabetes Care, Inc.’s First Quarter 2026 Earnings Call. Today’s discussion will include forward-looking statements. These statements reflect management’s expectations about future events, our product pipeline, development timelines, financial performance, and operating plans, and speak only as of today’s date. There are risks and uncertainties that could cause actual results to differ materially from those anticipated or projected in our forward-looking statements, which are described in our press release issued earlier today and under the Risk Factors portion of our most recent Annual Report on Form 10-K and Quarterly Report on Form 10-Q. Today’s discussion will also include references to both GAAP and non-GAAP financial measures. Unless otherwise noted, the financial metrics discussed today will be on a non-GAAP basis. Please refer to our earnings release issued earlier today and available on the Investor Center portion of our website for a r...