TNDM Stock Falls on Q2 Earnings Miss, Revenues Beat, Gross Margin Up

Tandem Diabetes Care, Inc. TNDM posted a second-quarter 2025 loss of 48 cents per share, which remained flat year over year. The figure missed the Zacks Consensus Estimate of a loss of 40 cents per share.

On a GAAP basis, the company reported a loss of 78 cents per share compared with the year-ago quarter’s loss of 47 cents.

Following the earnings announcement, TNDM stock declined 20% last Thursday.

TNDM’s Q2 Revenues

Non-GAAP revenues amounted to $240.7 million, up 8.5% year over year. The figure surpassed the Zacks Consensus Estimate by 0.9%.

GAAP revenues in the quarter totaled $240.7 million, up 8.5% year over year.

TNDM’s Quarterly Performance in Detail

Tandem Diabetes reports under two primary markets based on the geographic location to which its products are shipped.

The United States

Non-GAAP sales in the United States totaled $170.2 million (same on a GAAP basis), up 9% year over year. The company shipped approximately 21,000 pumps in the quarter.

Outside the United States

TNDM registered non-GAAP sales of $70.5 million (same on a GAAP basis) compared with $65.2 million in the prior-year period.

Margins

The gross profit in the reported quarter was $125.9 million, up 11.6% year over year. The gross margin expanded 146 basis points (bps) to 52.3% despite a 5.2% rise in the cost of sales.

SG&A expenses rose 16.3% to $109.6 million. R&D expenses decreased 2.4% to $48.1 million.

The company registered an adjusted operating loss of $31.9 million compared with a loss of $30.8 million in the year-ago period.

Financial Position

Tandem Diabetes exited the second quarter of 2025 with cash, cash equivalents, and short-term investments of $315.4 million compared with $368.6 million at the end of the first quarter.

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

TNDM’s 2025 Guidance

The company provided its full-year 2025 GAAP financial guidance.

GAAP sales are estimated to be approximately $1.00 billion. The Zacks Consensus Estimate for full-year 2025 revenues is pegged at $1.00 billion.

GAAP sales in the United States are expected to be $700 million. Sales outside the United States are projected to be $300 million.

Our Take

Tandem Diabetes ended second-quarter 2025 on a mixed note, wherein earnings lagged estimates but revenues beat the same. The company achieved record quarterly sales, both in the United States and internationally. This strong performance was driven by TNDM’s expanding product portfolio. Meanwhile, the expansion of the gross margin amid rising costs is encouraging.

During the second quarter, TNDM initiated an early access program for the t:slim X2 insulin pump with Control-IQ+ technology, integrated with Abbott’s FreeStyle Libre 3 Plus continuous glucose monitoring sensor in the United States. Additionally, it received CE Mark for the Tandem Mobi insulin delivery system with Control-IQ+ technology.

On the flip side, the company’s operating loss is concerning.

TNDM’s Zacks Rank & Key Picks

TNDM currently carries a Zacks Rank #3 (Hold).

Some better-ranked stocks from the broader medical space are Medpace Holdings MEDP, GeneDx Holdings WGS and Cardinal Health CAH.

Medpace Holdings, currently sporting a Zacks Rank #1 (Strong Buy), reported a second-quarter 2025 EPS of $3.1, which beat the Zacks Consensus Estimate by 3.33%. Revenues of $603.3 million topped the consensus mark by 11.48%. You can see the complete list of today’s Zacks #1 Rank stocks here.

MEDP has a historical five-year earnings growth rate of 30.9% compared with the S&P 500 composite’s 10.1% growth.

GeneDx Holdings, carrying a Zacks Rank #2 (Buy) at present, posted a second-quarter 2025 adjusted EPS of 50 cents, which exceeded the Zacks Consensus Estimate by a remarkable 400%. Revenues of $102.7 million surpassed the Zacks Consensus Estimate by 21.24%.

WGS has an estimated earnings growth rate of 79.6% for 2026 compared with the industry’s 18.6% growth.

Cardinal Health, carrying a Zacks Rank #2 at present, posted third-quarter fiscal 2025 adjusted EPS of $2.35, which exceeded the Zacks Consensus Estimate by 9.3%. Revenues of $54.88 billion missed the Zacks Consensus Estimate by 0.3%.

CAH has an estimated long-term earnings growth rate of 10.9% compared with the industry’s 9.9%. 

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This article originally published on Zacks Investment Research (zacks.com).

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