Insulet Cuts Sales Outlook as U.S. Omnipod Growth Slows
Second-quarter revenue rose 23.5% to $801.7 million, topping the company’s constant-currency growth guidance.
Insulet Corporation (PODD), the maker of Omnipod insulin-delivery systems, cut its full-year revenue-growth outlook as U.S. Omnipod growth slowed while the company scaled its type 2 diabetes business.
The revision marked a change from the first quarter, when Insulet had raised its annual outlook. Second-quarter revenue increased 5.3% sequentially, but constant-currency growth eased to 22.7% from 30.1% in the prior period.
Revenue rose to $801.7 million from a year earlier, while net income more than quadrupled to $95.0 million, or $1.37 a diluted share, from $22.5 million, or $0.32 a share. The year-earlier period included an $84.4 million loss on debt extinguishment. Adjusted earnings increased 41.5% to $1.66 a share.
Total Omnipod revenue grew 24.6% to $795.9 million, slowing from 36.9% growth in the first quarter. U.S. Omnipod revenue rose 20.1% to $544.1 million, compared with 28.3% growth in the prior quarter. International Omnipod revenue increased 35.5% to $251.8 million, supported by wider Omnipod 5 availability, including a launch in Spain.
Adjusted operating margin expanded more than 140 basis points from a year earlier to 19.3%, and adjusted EBITDA increased to $199.8 million. Medical-device corrections weighed on the quarter, with Insulet recording $25.0 million of related operating costs, including $21.9 million against gross profit. The corrections covered roughly 7 million Omnipod 5, DASH and Eros Pods across the U.S. and affected international markets.
Insulet’s full-year outlook now calls for constant-currency revenue growth of 20% to 22%, down from 21% to 23%. The company reduced its U.S. Omnipod forecast to 17% to 19% while raising its international forecast to 30% to 32%. Third-quarter guidance calls for total constant-currency revenue growth of 17.5% to 19.5%, including U.S. Omnipod growth of 14% to 16%.
The company maintained its target of roughly 100 basis points of adjusted operating-margin expansion and raised its adjusted EPS-growth outlook to more than 30%. First-half free cash flow fell to $145.4 million as operating cash flow declined and capital spending increased, leaving profit growth to carry more of the year’s outlook as U.S. sales moderated.