What Insulet (PODD) Said on Its Q3 Earnings Call

Key Points

• Q3 results were strong: Revenue rose 19.2% to $842 million, while adjusted EPS climbed 60% to $1.99. Adjusted gross margin reached a record 74.2%, and adjusted operating margin expanded to 22%.
• Insulet raised confidence in its 2026 outlook but signaled slower growth ahead: It expects 2026 constant-currency revenue growth of 21%–22%, but sees 2027 growth modestly below its previous mid-teens framework, citing more cautious U.S. market assumptions and moderating international growth.
• The company is investing in future growth and returning capital: Insulet expects to launch Omnipod 6 in 2027 and authorized an additional $1 billion for share repurchases, including plans to buy back $400 million of shares in Q4.

Insulet NASDAQ: PODD reported third-quarter revenue of $842 million, up 19.2% on a reported basis and 19.6% on a constant-currency basis, as international growth outpaced the company’s plans and U.S. performance landed within its guidance range.

President and Chief Executive Officer Ashley McEvoy said the company’s global customer base grew more than 20% from a year earlier, while new customer starts rose by a low-single-digit percentage during the quarter and were up by a low-double-digit percentage year to date. McEvoy said more than 85% of Omnipod new customer starts come from people transitioning from multiple daily injections, or MDI.

Insulet said type 2 diabetes patients represented more than 40% of U.S. new customer starts in the quarter. The company said it has not seen increased use of GLP-1 medicines affect type 2 starts and continues to view those therapies as complementary to insulin.

Revenue Growth and Margin Expansion

U.S. Omnipod revenue grew 14.7% in the third quarter, supported by demand across type 1 and type 2 diabetes. Insulet said its U.S. customer base increased in the high teens, while U.S. new customer starts were flat year over year. U.S. pricing declined slightly in the quarter but was flat through the first nine months, and the company said it still expects positive pricing for the full year.

International Omnipod revenue rose 31.7% on a reported basis and 33% on a constant-currency basis. The company said international results benefited from volume growth, favorable price mix, and a 250-basis-point benefit from reserve adjustments. Those adjustments included about $3 million in France related primarily to its clawback accrual and about $2 million in Canada from reserve releases and updated program assumptions.

Chief Financial Officer Flavia Pease said adjusted gross margin reached a record 74.2%, expanding 200 basis points from a year earlier. Adjusted operating margin rose 490 basis points to 22%, aided by revenue growth, gross-margin improvement and lower annual employee bonus accruals.

Adjusted earnings per share increased 60% to $1.99 from $1.24 in the prior-year period. Net interest expense totaled $12.1 million, and the adjusted tax rate was 20.2%.

• Third-quarter revenue: $842 million
• Adjusted gross margin: 74.2%
• Adjusted operating margin: 22%
• Adjusted EPS: $1.99
• Year-to-date free cash flow: $212 million

Updated 2026 Outlook and Cautious 2027 View

Insulet narrowed its 2026 revenue outlook to the upper end of its previous range. The company now expects total revenue to grow 21% to 22% on a constant-currency basis, while total Omnipod revenue is expected to increase 21.5% to 22.5%.

For the U.S., Insulet expects full-year Omnipod revenue growth of 17.5% to 18.5%. International Omnipod revenue is projected to grow 32% to 33% in constant currency, including a high-single-digit benefit from price mix. The company expects approximately 150 basis points of adjusted operating-margin expansion for the year, adjusted EPS growth of more than 30%, and free cash flow of about $275 million.

For the fourth quarter, the company expects total revenue growth of 13.5% to 17% and U.S. Omnipod revenue growth of 10% to 13.5%. International Omnipod revenue is expected to rise 21% to 24%.

Looking ahead, management said it expects 2027 total-company growth to be modestly below the mid-teens framework previously discussed. Pease said the company expects to guide U.S. growth toward the lower end of its prior 9% to 14% framework, reflecting more measured market-growth assumptions, new competition, stable retention and limited contribution from new launches and the expanded sales force.

Management also expects international growth to moderate meaningfully from 2026 because of a more difficult comparison, reduced price-mix benefits as more customers transition to Omnipod 5, and the anniversary of several country launches. Insulet plans to provide formal 2027 guidance in February.

Type 2 Retention Efforts and Product Pipeline

McEvoy said Insulet has implemented actions intended to improve retention among type 2 customers, including tighter sample-program governance, compensation changes for its sales force that incorporate retention, and the addition of clinical specialists focused on customer retention. The company said type 2 retention improved modestly in the third quarter but expects the benefits of the initiatives to build over time.

Insulet also completed the full U.S. market release of Omnipod Discover, its engagement platform for people with diabetes and clinicians. The company said the platform had been adopted by more than 35,000 users and 5,000 clinicians as of the call. During its limited release, Insulet said it observed stronger retention and increased time in range among users.

The company said its updated Omnipod 5 algorithm is now broadly available at U.S. retail. The enhancement adds a 100 milligrams-per-deciliter target and reduces automated-delivery restriction alarms, according to management.

Insulet submitted the second and final 510(k) application for Omnipod 6 and continues to expect a 2027 launch. McEvoy said early data showed adults and adolescents with type 1 diabetes achieved 76% time in range with 40% fewer boluses on Omnipod 6. The company also completed enrollment in its EVOLVE pivotal study for a fully closed-loop type 2 diabetes system, targeting a 510(k) submission in 2027 and a planned 2028 launch.

Capital Returns and Commercial Expansion

Insulet’s board authorized a $1 billion increase to its share-repurchase program. The company expects to spend $400 million on repurchases in the fourth quarter using cash on hand.

During the quarter, Insulet increased its corporate revolver to $750 million and refinanced its Term Loan B, reducing the interest rate by 25 basis points. It ended the quarter with $584 million in cash and investments and the full $750 million available under its revolver.

The company expanded its U.S. sales force by nearly 25% in its second expansion in two years and rolled out a new customer relationship management platform to its U.S. sales organization. It also said nearly 34,000 healthcare providers prescribe Omnipod, up more than 20% year over year. Insulet has finalized one of three pharmacy benefit manager contracts for 2027 and expects to complete the other two in the coming weeks.

About Insulet (NASDAQ:PODD)

Insulet Corporation is a medical device company that develops, manufactures and sells wearable, tubeless insulin delivery systems for people with insulin-dependent diabetes. Its products are designed to provide an alternative to traditional insulin injections and conventional tubed insulin pumps.

The company's primary product platform is Omnipod, which includes the disposable, wearable Pod and a handheld controller or compatible smartphone-based application. Omnipod products include the Omnipod DASH system and the Omnipod 5 Automated Insulin Delivery System, which is designed to integrate with compatible continuous glucose monitoring technology to help automate insulin delivery.

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