Insulet (NASDAQ: PODD) reported Q1 EPS of ($0.03), $0.03 worse than the analyst estimate of $0.00. Revenue for the quarter came in at $198 million versus the consensus estimate of $189.58 million.

First Quarter Financial Highlights:

• First quarter 2020 revenue of $198.0 million, up 24.1%, or 25.3% in constant currency1, compared to $159.6 million in the prior year, exceeds guidance of 17% to 20% revenue growth, or 18% to 21% on a constant currency basis
  • Total Omnipod revenue of $189.7 million, an increase of 32.7%, or 34.0% in constant currency
    • U.S. Omnipod revenue of $116.6 million, an increase of 35.4%
    • International Omnipod revenue of $73.1 million, an increase of 28.5%, or 31.9% in constant currency
  • Drug Delivery revenue of $8.3 million, a decrease of 50.0%
• Gross margin of 64.1%, down 280 basis points, including an approximate 160 basis point impact due to COVID-19 related safety and mitigation costs
• Net loss of $2.1 million, or $(0.03) per diluted share, compared to net income of $4.4 million, or $0.07 per diluted share, in the prior year
• Adjusted EBITDA1 of $24.3 million or 12.3% of revenue, compared to $20.4 million or 12.8% of revenue in the prior year

“Our thoughts are with all those affected by COVID-19 and our gratitude goes out to the medical professionals and first responders on the front lines during this unprecedented time,” said Shacey Petrovic, President and Chief Executive Officer. “I am proud of the way our employees have rapidly adjusted to the realities of the COVID-19 pandemic, responding with resilience and compassion and maintaining an unwavering focus on our mission to improve the lives of people with diabetes.”

Ms. Petrovic continued, “Insulet entered 2020 with positive momentum, making progress toward our strategic objectives and achieving strong revenue growth ahead of expectations. The efficiency and redundancy we have built in our supply chain and manufacturing operations enabled us to meet customer demand without interruption during this challenging time. We believe that our proven, durable annuity business model will continue to generate double-digit revenue growth in 2020. We remain confident we have the right strategic framework to effectively advance our mission, drive sustainable long-term growth throughout our global business, and to continue to create shareholder value.”

2020 Outlook:

It is difficult to accurately predict the progression of COVID-19 and the extent of the resulting disruption. However, given the benefit of Insulet’s recurring revenue model, results through April, and available macro information, the Company is issuing guidance. The Company assumed that the most significant impact on new global Omnipod starts is in the second quarter. The Company has also assumed the pandemic and recessionary headwinds will persist throughout 2020, with an estimated gradual recovery starting in the third quarter as economies begin to open and customers are able to resume more normal physician meetings. As a result of the durability of its annuity business model, the Company expects strong revenue growth to continue in the second quarter and be most impacted in the second half of 2020.

Revenue Guidance:

• For the year ending December 31, 2020, the Company is guiding to approximately 15% in constant currency, at the low end of its total Company revenue growth range that was previously provided on February 25, 2020 (15% to 19% in constant currency). By product line, the Company now expects:
  • Total Omnipod to be approximately 18% in constant currency, at the low end of the range previously provided of 18% to 22%
    • U.S. Omnipod to be approximately 19%, near the lower end of the range previously provided of 18% to 22%
    • International Omnipod to be approximately 16% in constant currency, compared to the range previously provided of 18% to 22%
  • Drug Delivery to be in the middle of the previously provided range of a 15% to 20% decline
• For the quarter ending June 30, 2020, the Company expects revenue growth of 19% to 23% in constant currency. Revenue growth ranges by product line are:
  • Total Omnipod of 19% to 23% in constant currency
    • U.S. Omnipod of 21% to 25%
    • International Omnipod of 15% to 19% in constant currency
  • Drug Delivery of 18% to 22%

Adjusted EBITDA:

For the year ending December 31, 2020, the Company is reaffirming its expectation of Adjusted EBITDA as a percentage of revenue in the mid-teens, now closer to the low end of the range.

For earnings history and earnings-related data on Insulet (PODD) click here.