Earnings

Tandem Diabetes CFO Tells Analysts To 'Recalibrate' 2027 Models As Pharmacy Rollout Lags

The CFO called mid-to-high single-digit 2027 revenue growth a fair starting point, on the call that announced CEO John Sheridan's retirement.

Matteo Parrino Jonathan Ponciano

Matteo Parrino, Jonathan Ponciano

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Tandem Diabetes CFO Tells Analysts To 'Recalibrate' 2027 Models As Pharmacy Rollout Lags

Tandem Diabetes Care, which makes insulin pumps and related software, is moving to pharmacy-channel sales more slowly than planned, and CFO Leigh Vosseller told analysts on the third-quarter earnings call that they will "need to re-look at their models for next year and recalibrate." She also called a "mid to high single digit increase year over year" a "really fair starting point" for 2027 revenue growth.

A slower pharmacy ramp

Vosseller said pharmacy-channel pumps should be 10% to 12% of pump shipments for 2026, and also roughly 10% to 12% of sales, which she put as low teens on average. In the third quarter pharmacy reached about 12% of pump shipments and 15% of U.S. sales. She said adoption has come "more gradually" than management first expected and will fall short of the original assumptions for the year.

Because pump adoption is outpacing the conversion of supply purchases, she said, management expects sales headwinds to extend into 2027. Net supply prices are averaging closer to $400 a month, against the $350 baseline the company set. The pharmacy model covers pumps like a drug benefit, with no upfront pump charge; Vosseller said higher recurring supply revenue offset that lost pump revenue in the quarter.

Asked by an analyst whether consensus growth of about 12% next year was too high, Vosseller said it was too early for numbers. Even so, she said the questioner was "in the ballpark."

Why guidance did not move

A Stifel analyst pressed on why full-year guidance stayed unchanged if thousands of pumps are now billed upfront through traditional channels instead of pharmacy. Vosseller said management wanted to "err on the side of considering outperformance on pharmacy could actually have a negative impact on sales."

The 2026 outlook keeps worldwide sales at $1.65 billion to $1.85 billion, with gross margin of 56% to 57%. For the fourth quarter, she expects 15% to 20% of pumps to ship through pharmacy.

Quarter and CEO handoff

Worldwide revenue grew 14% to $284 million, and pump shipments rose 12% to about 33,000. Gross margin was 57%, and the company ended the quarter with $443 million in cash and investments.

The call also carried news of a leadership change. Board Chair Becky Robertson said Sheridan will retire at the end of 2026 and Jeannette Bankes will join as president and CEO on November 16. Sheridan said he is 70.

Tandem serves nearly 330,000 customers in its installed base, a figure Vosseller described as sizable and growing.

Sheridan said he expects FDA clearance of Mobi tubeless and the start of a pivotal fully closed-loop study, both in the fourth quarter.

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