Q2 2026 Tandem Diabetes Care Inc Earnings Call Transcript
Key Points
- Worldwide pump shipments grew more than 10% year-over-year and sequentially, with record Q2 sales of $255 million.
- Gross margin improved to 57%, the second highest in company history, driven by pricing benefits from the pharmacy channel and scaling Mobi volumes.
- New pump starts from MDI grew mid-single-digits year-over-year and now represent approximately 70% of new starts, with Mobi accounting for over half of new customer shipments.
- Pharmacy channel adoption is gaining traction, with 45% formulary coverage and 10% of U.S. sales through pharmacy in the first full quarter of PAYGO.
- FDA submission for Mobi Tubeless was completed, positioning Tandem to enter the high-growth tubeless market with the world's first extended-wear patch pump.
- International direct launches in the UK, Switzerland, and Austria are showing early traction, with direct channel sales more than doubling year-over-year.
- Adjusted EBITDA margin turned positive for the fourth consecutive quarter, and stock-based compensation expense decreased significantly.
- U.S. new pump starts were nearly flat year-over-year, slightly below expectations, though they improved sequentially.
- Infusion set supply constraints from a key supplier impacted sales, particularly internationally, with the greatest impact in Q2.
- Pharmacy pump shipments create a near-term revenue headwind, with an $8 million impact in Q2, and pump adoption is outpacing supply conversions.
- International sales faced headwinds from distributor inventory buybacks and destocking, totaling approximately $3 million.
- Gross margin is expected to step down sequentially in Q3 due to pharmacy pricing dynamics and planned increases in operating expenses.
- The company faces uncertainty regarding FDA clearance for Mobi Tubeless, which could delay the scaled launch planned for the second half of the year.
- Type 2 attrition is modestly higher than Type 1, and the company remains cautious about the market's growth potential.
Thank you for standing by and welcome to the Tandem Diabetes Care second quarter 2026 earnings conference call. At this time, all participants are in listen-only mode. After the speaker's presentation, there will be a question-and-answer session. To ask a question during the session, you'll need to press star 11 on your telephone. If your question has been answered and you'd like to remove yourself from the queue. Simply press *11 again. As a reminder, today's program is being recorded.
And now I'd like to introduce your host for today's program, Susan Morrison, Chief Administration Officer and Investor Relations. Please go ahead.
Hello, and welcome to Tandem's 2026 second quarter earnings call. Today's discussion will include forward-looking statements. These statements reflect management's expectations about future events, our product pipeline, development timelines, and financial performance and operating plans, and speak only as of today's date.
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