The rise has brought the diabetes management company's shares to nearly the same level as they were at the beginning of this year.
DexCom reported a 27.1% year-over-year jump in revenue to $2.4 billion for fiscal year 2021 but operating income declined by 11.3% year over year due to higher research and development expenses. The company sounded an optimistic note for 2022, guiding for revenue of $2.88 billion, up 18% year over year, as it continues to advance on its business development initiatives. In line with the good results, the board of directors approved a 4-for-1 stock split.
During the month, DexCom's G7 continuous glucose monitoring (CGM) system received the CE Mark, which will allow it to be sold in within the European Economic Area, for diabetes patients age 2 and above, including pregnant patients. This new product not only offers a list of customizable alerts that can warn users of high or low blood glucose levels, but also has the fastest sensor warmup in the market with no finger pricks or scanning required. In addition, DexCom is working with insulin pump partners to eventually integrate the G7 system into automated insulin delivery systems.
According to the World Health Organization, around 422 million people worldwide suffer from diabetes and the number of cases and prevalence has been steadily increasing over the last few decades. DexCom estimates that by 2045, around 783 million adults ages 20 to 79 will have this condition. The global market for diabetes diagnostics is estimated at $30.8 billion this year and will rise by 8% per year to hit $42.4 billion by 2026. These numbers demonstrate that there are ample growth opportunities for DexCom to increase its market share to capture a slice of this lucrative pie. The company had indicated that the expansion into new markets where DexCom has little current commercial presence can triple its patient total addressable market by the second half of 2023.
Just last week, the company announced its new DexCom One CGM system that will launch in the United Kingdom by May. The device has a wearable sensor and transmitter that allows users to monitor their glucose levels and send these values in real time to their smart devices for tracking. With the G7 receiving CE approval and the launch of its newest product, DexCom looks poised to report better numbers going forward and investors can also look forward to more innovative products in the pipeline.