Key Highlights

  • Revenue rose 11% to $1.34 billion from $1.21 billion in the third quarter of 2025.
  • Gross profit increased 18% to $864.4 million, lifting gross Margin to 64% from 60%.
  • Operating income grew 35% to $327.2 million.
  • Net income was $275.1 million, down 3%, while diluted EPS rose to $0.72 from $0.70.
  • A new $1.00 billion share repurchase program was authorized in October 2026.

Sensor Volume lifts Revenue 11%

Dexcom (NASDAQ:DXCM) designs, develops and sells continuous glucose monitoring systems for people managing diabetes and metabolic health. Its products include the G7 15 Day system launched in late 2025 and Stelo, an over-the-counter glucose biosensor. The company filed its Quarterly Report on October 29, 2026, covering the quarter ended September 30, 2026.

Revenue was $1,344.5 million, up $135.2 million, or 11%, from $1,209.3 million. The company said the increase was primarily driven by higher sales volume of disposable sensors as its worldwide customer base grew.

United States revenue rose to $969.8 million from $851.9 million, which is about 13.8% growth on a calculated basis. International revenue was $374.7 million against $357.4 million, or about 4.8% on a calculated basis.

Gross margin widens to 64%

Gross profit rose 18% to $864.4 million, and gross margin reached 64% of revenue from 60%. Cost of sales was essentially flat at $480.1 million versus $477.9 million, even as revenue climbed.

Dexcom credited higher sales volume, G7 15 Day benefits, Manufacturing efficiencies, higher production volumes and a more favorable manufacturing mix. Those gains were partly offset by higher inventory reserve charges tied to the planned discontinuation of G6 manufacturing.

Operating income jumps, but Net Income dips on lower other income

Operating expenses were $537.2 million, up 10%, with selling, general and administrative expense at $375.6 million, up 13%, mainly on $20.7 million of added Advertising and marketing.

Operating income was $327.2 million, up from $242.5 million. Other income, net, fell to $7.5 million from $109.8 million, mainly because a year earlier included an $82.5 million gain on Equity investments, and interest and Dividend income was $18.4 million lower.

Income before taxes was $334.7 million, down 5%. Income tax expense was $59.6 million, which is about a 17.8% effective rate on a calculated basis, compared with about 19.4% a year earlier.

Nine month results and cash generation

Net income was down 3% from $283.8 million, yet diluted EPS rose to $0.72 from $0.70 because diluted shares fell to 383.5 million from 407.4 million.

For the nine months ended September 30, 2026, revenue rose 13% to $3,844.8 million, Operating Income climbed 53% to $900.8 million, and net income increased 27% to $723.7 million. Operating Cash Flow was $1.12 billion for the nine months. In the third quarter alone it was $325.6 million, down 51% from the same quarter in 2025.

Buybacks and balance sheet

Cash, cash equivalents and short-term marketable securities totaled $1.82 billion at September 30, 2026. Dexcom had no outstanding borrowings under its Credit facility, with $191.3 million available, and $1,250.0 million of convertible notes mature in May 2028.

During the quarter the company repurchased 4.6 million shares for $400.0 million, and 13.2 million shares for $1.00 billion over nine months, which completed its 2026 program. In October 2026 the board authorized a new program of up to $1.00 billion, running no later than December 31, 2027.

Readers following the company will likely watch whether gross margin holds near 64%, how international growth develops, and how quickly the new repurchase authorization is used.