Insulet Q2 Earnings Call Highlights

Key Points

• Strong Q2 performance: Insulet reported revenue of $802 million, up 22.7% on a constant-currency basis, while adjusted EPS rose 41.5% to $1.66. International Omnipod revenue grew 33% on a constant-currency basis, outpacing 20% U.S. growth.
• Type 2 retention pressured the outlook: Lower-than-expected utilization and retention during the first 90 days among Type 2 customers led Insulet to reduce its 2026 U.S. and total-company growth forecasts. Management plans to improve onboarding, customer support, sales incentives and patient targeting.
• International growth and pipeline remain key positives: Insulet raised its 2026 international growth outlook to 30%–32% and continues developing Omnipod 6 and a fully closed-loop system targeting Type 2 diabetes, with potential launches or regulatory submissions in 2027.

Insulet NASDAQ: PODD reported second-quarter revenue growth of 23% on a constant-currency basis, supported by demand for its Omnipod insulin-delivery system in the U.S. and international markets, while raising its international outlook and reducing its U.S. and total-company revenue-growth expectations for 2026.

The company generated $802 million in second-quarter revenue, up 23.5% on a reported basis and 22.7% on a constant-currency basis. U.S. Omnipod revenue increased 20%, while international Omnipod revenue rose 35% on a reported basis and 33% on a constant-currency basis, driven mainly by volume and favorable price mix.

Adjusted earnings per share rose 41.5% to $1.66 from $1.17 a year earlier. Adjusted gross margin expanded 320 basis points to 72.9%, while adjusted operating margin increased 140 basis points to 19.3%.

Chief Executive Officer Ashley McEvoy said the company’s global customer base grew 23%, aided by its second-highest quarter ever for new customer starts. More than 85% of U.S. new customer starts came from multiple daily injection, or MDI, users, and more than 40% of starts involved people with Type 2 diabetes.

Type 2 Retention Drives Outlook Revision

Despite healthy demand and new customer starts, Insulet said it has identified lower-than-anticipated utilization and retention among Type 2 customers, particularly during the first 90 days of therapy. McEvoy said the company is still early in its efforts to serve the Type 2 population, having launched into that market about 20 months ago after more than 25 years serving Type 1 diabetes patients.

“We should have identified the issue sooner,” McEvoy said, taking accountability for the lower U.S. outlook. She characterized the issue as an execution challenge rather than a structural change in the market, and said it was not caused by pricing, competition or GLP-1 therapies.

Management said Type 2 retention stabilizes after patients have remained on Omnipod for 90 days, as users gain comfort with the technology and its benefits. The company said it is taking steps to improve onboarding and support during early patient interactions, including the first pod activation, pod change and prescription refill.

• Expanding customer-care resources, including insurance-navigation support.
• Changing sales-force compensation to emphasize retention in addition to new customer starts.
• Refining sampling programs to identify patients most likely to benefit and to improve conversion and retention.
• Expanding use of Omnipod Discover, a cloud-based platform designed to help patients and providers monitor trends and personalize therapy.

McEvoy said Omnipod Discover had more than 12,000 people with diabetes and over 1,600 healthcare professionals using the platform. Chief Operating Officer Eric Benjamin said limited-market-release data showed encouraging results for patient outcomes, satisfaction and retention, though the company did not disclose specific retention metrics.

Updated 2026 Guidance

Insulet now expects 2026 total-company revenue growth of 20% to 22% on a constant-currency basis, with total Omnipod revenue growth of 21% to 23%. The company expects foreign exchange to add about 100 basis points to reported growth for both measures.

U.S. Omnipod revenue is now projected to rise 17% to 19%, while international Omnipod revenue is expected to grow 30% to 32%, an increase to the international forecast reflecting first-half performance and continued momentum in overseas markets.

Chief Financial Officer Flavia Pease said roughly two-thirds of the reduction to the prior outlook reflects the assumption that current Type 2 utilization and retention trends continue through the second half of 2026. The remaining one-third reflects slower-than-anticipated new customer starts at the beginning of the year and slightly lower expected positive pricing.

For the third quarter, Insulet forecast total-company revenue growth of 17.5% to 19.5% and Omnipod revenue growth of 18% to 20%. It expects U.S. Omnipod growth of 14% to 16% and international Omnipod growth of 28% to 30% on a constant-currency basis.

The company maintained its expectation for about 100 basis points of adjusted operating-margin expansion in 2026 and said it now expects adjusted EPS growth of at least 30% for the year. Insulet ended the quarter with $535 million in cash and investments, $500 million available under its revolving credit facility and $145 million in year-to-date free cash flow.

International Momentum and Product Pipeline

Internationally, Insulet said Omnipod 5 became the leading insulin pump for new users in Australia. The company also launched in Spain during the quarter. Management said it added coverage for 6.5 million additional lives and simplified prior-authorization requirements for about 10 million lives.

The company continues to invest in its product pipeline, including Omnipod 6, which it expects to launch in 2027, and a fully closed-loop system aimed at Type 2 diabetes. Insulet said enrollment is progressing in its pivotal Evolve study for the fully closed-loop program and continues to target a 510(k) submission in 2027.

McEvoy said the fully closed-loop system is designed to require no bolusing, settings or manual titration, potentially addressing needs among Type 2 patients and primary-care providers. The company said 70% of Type 2 patients are managed in primary care.

Preliminary View of 2027

Insulet did not provide formal 2027 guidance, saying it needs more time to assess the effects of its retention and utilization initiatives. However, Pease said the company expects to exit 2026 with total-company constant-currency revenue growth in the mid-teens, based on the midpoints of its third-quarter and full-year guidance ranges.

The company’s objective for 2027 is to deliver growth consistent with or above that exit rate, supported by product launches and the benefits of sales-force expansion. Management said this preliminary view assumes competitive entrants in 2027 and a stable pricing environment, but does not assume improvements from the actions being taken to improve Type 2 retention and utilization.

Insulet plans to provide formal 2027 guidance and an updated long-range outlook on its fourth-quarter earnings call.

About Insulet (NASDAQ:PODD)

Insulet Corporation is a medical device company headquartered in Acton, Massachusetts, that develops, manufactures and sells insulin-delivery systems for people with diabetes. The company's core business is the design and commercialization of its Omnipod family of tubeless, wearable insulin pumps and the consumable Pods that deliver insulin. Insulet's products aim to simplify insulin delivery for people with type 1 diabetes and insulin-requiring type 2 diabetes by offering an alternative to traditional insulin pens and tethered pump systems.

The company's product portfolio includes the Omnipod System line—disposable, waterproof Pods that adhere to the skin and deliver insulin—and the associated controllers and mobile applications used to program and monitor insulin delivery.

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