Tandem Diabetes Care reported financial results for the quarter and fiscal year ended December 31, 2025 and provided guidance for the year ending December 31, 2026.

Tandem Diabetes Care, Inc. (Nasdaq: TNDM), a global insulin delivery and diabetes technology company, today reported its financial results for the quarter and fiscal year ended December 31, 2025 and provided its financial guidance for the year ending December 31, 2026.

Fourth Quarter 2025 Financial and Strategic Highlights

Achieved record quarterly sales:

Worldwide sales of $290.4 million

United States sales of $210.5 million

Worldwide pump shipments of 38,000

United States pump shipments of 27,000

Delivered meaningful operational improvement:

Record quarterly gross margin of 58%

Operating income of $8.3 million, or 3% of sales

Net loss of $0.6 million with positive adjusted EBITDA(1) of 11% of sales

Positive cash flow from operating activities of $9.8 million and positive free cash flow(1) of $3.1 million

Delivered key portfolio enhancements:

Began global commercial rollout of t:slim X2 pump integration with the FreeStyle Libre 3 Plus continuous glucose monitoring sensor

Initiated launch of Android mobile control for the Tandem Mobi insulin delivery system

Full Year 2025 Financial Highlights

Achieved milestone of $1.015 billion in worldwide sales

Demonstrated growth in worldwide pump shipments to more than 126,000

Expanded gross margin to 54%

Recent Strategic Highlights

Introducing pay-as-you-go pharmacy structure, advancing the Company's multi-channel initiative in the United States

Began direct commercial operations in select European countries

Filed a 510(k) with the United States Food and Drug Administration for a pregnancy indication for Control-IQ+ technology

"2025 was a defining year for Tandem as we surpassed $1 billion in worldwide sales and set gross margin records, while modernizing our commercial operations, reshaping our business model, and driving innovation," said John Sheridan, president and chief executive officer. "In 2026, we plan to build upon this momentum as we further strengthen our business, while delivering new technology solutions to improve the lives of people with diabetes."

Fourth Quarter and Full Year 2025 Sales Results Compared to 2024

United States sales and margins in 2024 were impacted by the accounting treatment of the Tandem Choice program (Tandem Choice), which concluded in 2024 and is excluded from non-GAAP results. Accordingly, the Company is presenting select financial results on both a GAAP and non-GAAP basis. 

Fourth Quarter 2025 Results Compared to Fourth Quarter 2024

Sales(2): Worldwide GAAP sales increased 3% to $290.4 million, compared to $282.6 million which included the recognition of $30.2 million in sales related to Tandem Choice. Excluding the impact of Tandem Choice, Non-GAAP sales(1) increased 15% to $290.4 million compared to $252.4 million.

GAAP sales in the United States decreased 2% to $210.5 million, compared to $214.6 million which included the recognition of $30.2 million in sales related to Tandem Choice. Excluding the impact of Tandem Choice, Non-GAAP sales in the United States grew 14% to $210.5 million compared to $184.4 million.

International sales increased 17% to $79.9 million compared to $68.1 million.

Shipments in the United States were more than 27,000 pumps. International shipments were approximately 11,000 pumps.

Gross profit(2): GAAP gross profit was $167.5 million, compared to $157.5 million. GAAP gross margin was 58%, compared to 56%.

Non-GAAP gross profit(1) was $167.5 million, compared to $127.9 million. Non-GAAP gross margin(1) was 58%, compared to 51%.

Operating income (loss): GAAP operating income was $8.3 million, or 3% of sales, compared to operating loss of $0.6 million, or 0% of sales.

Non-GAAP operating income(1) was $8.3 million, or 3% of sales, compared to Non-GAAP operating loss of $30.2 million or negative 12% of sales.

Net income (loss): GAAP net loss was $0.6 million, compared to net income of $0.8 million.

Non-GAAP net loss(1) was $0.6 million, compared to $28.8 million.

Adjusted EBITDA(1) was $32.9 million, or 11% of sales, compared to $2.3 million, or 1% of sales.

Full Year 2025 Financial Results Compared to Full Year 2024

Sales(2): Worldwide GAAP sales increased 8% to $1.015 billion, compared to $940.2 million which included the recognition of $30.2 million in sales related to Tandem Choice. Excluding the impact of Tandem Choice, Non-GAAP worldwide sales(1) increased 12% to $1.015 billion, compared to $910.0 million.

GAAP sales in the United States increased 5% to $706.9 million, compared to $672.7 million which included the recognition of $30.2 million in sales related to Tandem Choice. Excluding the impact of Tandem Choice, Non-GAAP sales in the United States grew 10% to $706.9 million compared to $642.4 million.

International sales increased 15% to $307.8 million compared to $267.5 million.

Shipments in the United States were more than 86,000 pumps. International shipments were more than 40,000 pumps.

Gross profit(2): GAAP gross profit was $546.0 million, compared to $489.6 million. GAAP gross margin was 54%, compared to 52%.

Non-GAAP gross profit(1) was $546.0 million, compared to $460.6 million. Non-GAAP gross margin(1) was 54%, compared to 51%.

Operating loss: GAAP operating loss was $187.3 million, or negative 18% of sales, compared to $99.1 million, or negative 11% of sales.

Non-GAAP operating loss(1) was $156.1 million, or negative 15% of sales, compared to $128.1 million or negative 14% of sales.

Net loss: GAAP net loss was $204.7 million, compared to $96.0 million.

Non-GAAP net loss(1) was $173.6 million, compared to $125.0 million.

Adjusted EBITDA(1) was negative $46.1 million, or negative 5% of sales, compared to negative $10.1 million, or negative 1% of sales. 2025 adjusted EBITDA included $75.2 million, or a negative 8 percentage point impact for an acquired in-process research and development charge.

2026 Financial Guidance

"In 2026, our goal is to expand the worldwide market by delivering double-digit pump shipment growth. We are adopting a pay-as-you-go model in the U.S. that provides affordable access to customers, and progresses our business toward more predictable and profitable revenue that may not be evident in our 2026 sales expectations," said Leigh Vosseller, executive vice president and chief financial officer. "We remain committed to improving margins and profitability during this transition that positions Tandem for accelerated sales growth in 2027 and beyond."

For the year ending December 31, 2026, the Company is providing its full year and first quarter GAAP financial guidance as follows:

Sales for the full year are estimated to be approximately $1.065 billion to $1.085 billion

United States - reflects transition to pay-as-you-go business model in pharmacy channel

Shipments are estimated to increase approximately 10% to 11%

Sales of approximately $730 million to $745 million

Pay-as-you-go headwind of approximately $70 million to $80 million

International - reflects preparation for transition to direct commercial operations in select countries

Sales of approximately $335 million to $340 million

Direct transition headwind of approximately $15 million

Gross margin is estimated to be approximately 56% to 57% of sales

Adjusted EBITDA(2) margin is estimated to be approximately 5% to 6% of sales

Non-cash charges included in cost of goods sold and operating expenses are estimated to be approximately $100 million. This includes:

Approximately $80 million non-cash, stock-based compensation expense

Approximately $20 million depreciation and amortization expense

Non-GAAP Financial Measures

Certain non-GAAP financial measures are presented in this press release to provide information that may assist investors in understanding the Company's financial results and assessing its prospects for future performance. The Company believes these non-GAAP financial measures are important operating performance indicators because they exclude items that are unrelated to, and may not be indicative of, the Company's core operating results. These non-GAAP financial measures, as calculated, may not necessarily be comparable to similarly titled measures of other companies and may not be appropriate measures for comparing the performance of other companies relative to the Company. These non-GAAP financial results are not intended to represent, and should not be considered to be more meaningful measures than, or alternatives to, measures of operating performance as determined in accordance with GAAP. To the extent the Company uses such non-GAAP financial measures in the future, we expect they will be calculated using a consistent method from period to period and, if not, an explanation will be provided. A reconciliation of each of the historical GAAP financial measures to the most directly comparable historical non-GAAP financial measures has been provided in Table D "Reconciliation of GAAP versus Non-GAAP Financial Results" attached to this press release.

In the first quarter of 2025, the Company included an adjustment for acquired in-process research and development (IPR&D) expense in its non-GAAP financials and provided guidance based on this practice. Beginning in the second quarter of 2025, the Company no longer included an adjustment for IPR&D expense in its non-GAAP results to align with views expressed by the staff of the U.S. Securities and Exchange Commission.

The accounting treatment for Tandem Choice, which was in effect from September 2022 through December 2024, had a high degree of complexity. When the program originally launched, the Company began deferring a portion of sales for each eligible t:slim X2 pump shipped in the United States. When a customer elected to participate in Tandem Choice upon the launch of Tandem Mobi in 2024, the Company recognized the existing deferral, incremental fees received and the associated costs of providing the new insulin pump at the time of fulfillment. Historical non-GAAP financial measures are presented in this press release to facilitate better comparisons of the Company's operating results across the reporting periods. Tandem Choice did not impact any financial measures for the year ending December 31, 2025.

Conference Call

The Company will hold a conference call and simultaneous webcast today at 4:30pm Eastern Time (1:30pm Pacific Time). 

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