Tandem Diabetes Care, Inc. (NASDAQ:TNDM) Q3 2022 Results Conference Call November 2, 2022 4:30 PM ET Company Participants Susan Morrison - Executive VP & Chief Administrative Officer John Sheridan - President, CEO & Director Leigh Vosseller - EVP, CFO & Treasurer Conference Call Participants Matt Miksic - Barclays Brooks O'Neil - Lake Street Capital Partners Chris Pasquale - Nephron Research Matthew O'Brien - Piper Sandler Steve Litchman - Oppenheimer Matt Taylor - Jefferies Alex Nowak - Craig-Hallum Jayson ...

Tandem Diabetes Care, Inc. (NASDAQ:TNDM) Q2 2022 Earnings Conference Call August 3, 2022 4:30 PM ET Company Participants Susan Morrison - Executive VP & Chief Administrative Officer John Sheridan - President, CEO & Director Brian Hansen - EVP & Chief Commercial Officer Leigh Vosseller - EVP, CFO & Treasurer Conference Call Participants Steven Lichtman - Oppenheimer Brooks O'Neil - Lake Street Capital Markets Travis Steed - Bank of America Merrill Lynch Jayson Bedford - Raymond James & Associates Matthew O'B ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 ____________________________________________________________________________________________ FORM 10-Q _____________________________________________________________________________________________ ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the Quarterly Period Ended June 30, 2022 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the Transi ...

Tandem Diabetes Care, Inc. (NASDAQ:TNDM) Q1 2022 Earnings Conference Call May 4, 2022 4:30 PM ET Company Participants Susan Morrison - EVP and Chief Administrative Officer John Sheridan - President and Chief Executive Officer Leigh Vosseller - EVP and Chief Financial Officer Conference Call Participants Steve Lichtman - Oppenheimer & Co Brooks O'Neil - Lake Street Capital Alex Nowak - Craig-Hallum Capital Jayson Bedford - Raymond James Danielle Antalffy - SVB Securities Jeff Johnson - Baird Disclaimer*: Thi ...

MAY 4, 2022 Company Overview * Safe Harbor CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS Certain statements in this presentation constitute forward-looking statements, including, without limitation, statements about: the perceived advantages of our products relative to competitive products and technologies; our anticipated growth and other measures of future operating results and financial performance; the development and commercialization of new products; our ability to secure and maintain necessary ...

PART I. FINANCIAL INFORMATION [Item 1. Financial Statements](index=3&type=section&id=Item%201.%20Financial%20Statements) This section presents the unaudited condensed consolidated financial statements for Tandem Diabetes Care, Inc., including the balance sheets, statements of operations and comprehensive loss, statements of stockholders' equity, and statements of cash flows, along with detailed notes explaining the company's organization, accounting policies, and specific financial line items for the periods ended March 31, 2022, and December 31, 2021 [Condensed Consolidated Balance Sheets](index=3&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) The company's total assets increased by **12.27%** from December 31, 2021, to March 31, 2022, primarily driven by an increase in cash and cash equivalents and a significant rise in operating lease right-of-use assets. Total liabilities also increased, largely due to long-term operating lease liabilities Balance Sheet Highlights | Metric | Dec 31, 2021 (in thousands) | Mar 31, 2022 (in thousands) | Change (in thousands) | % Change | | :-------------------------- | :-------------------------- | :-------------------------- | :-------------------- | :------- | | Cash and cash equivalents | $71,181 | $93,681 | $22,500 | 31.61% | | Short-term investments | $552,630 | $541,710 | $(10,920) | -1.98% | | Accounts receivable, net | $110,725 | $94,133 | $(16,592) | -14.98% | | Inventories | $68,551 | $79,987 | $11,436 | 16.68% | | Total current assets | $811,520 | $818,464 | $6,944 | 0.86% | | Operating lease ROU assets | $27,503 | $131,058 | $103,555 | 376.52% | | Total assets | $905,137 | $1,015,277 | $110,140 | 12.17% | | Total current liabilities | $131,856 | $131,815 | $(41) | -0.03% | | Convertible senior notes, net | $281,467 | $281,905 | $438 | 0.16% | | Operating lease liabilities - long-term | $23,922 | $129,195 | $105,273 | 439.90% | | Total liabilities | $472,025 | $577,895 | $105,870 | 22.43% | | Total stockholders' equity | $433,112 | $437,382 | $4,270 | 0.99% | [Condensed Consolidated Statements of Operations and Comprehensive Loss](index=4&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations%20and%20Comprehensive%20Loss) For the three months ended March 31, 2022, the company reported a significant increase in sales and gross profit compared to the prior year, but also experienced a larger operating loss and net loss due to substantial increases in operating expenses, particularly in selling, general and administrative, and research and development Statements of Operations Highlights | Metric (in thousands) | Three Months Ended Mar 31, 2022 | Three Months Ended Mar 31, 2021 | Change (in thousands) | % Change | | :-------------------- | :------------------------------ | :------------------------------ | :-------------------- | :------- | | Sales | $175,907 | $141,037 | $34,870 | 24.72% | | Cost of sales | $84,814 | $67,750 | $17,064 | 25.19% | | Gross profit | $91,093 | $73,287 | $17,806 | 24.29% | | Gross margin | 52% | 52% | 0% | 0.00% | | Operating expenses | $106,431 | $76,524 | $29,907 | 39.08% | | Operating loss | $(15,338) | $(3,237) | $(12,101) | 373.80% | | Net loss | $(14,715) | $(5,044) | $(9,671) | 191.74% | | Net loss per share | $(0.23) | $(0.08) | $(0.15) | 187.50% | [Condensed Consolidated Statements of Stockholders' Equity](index=5&type=section&id=Condensed%20Consolidated%20Statements%20of%20Stockholders'%20Equity) Stockholders' equity increased slightly from December 31, 2021, to March 31, 2022, primarily due to significant stock-based compensation expense and proceeds from stock option exercises, partially offset by the net loss and unrealized losses on short-term investments Stockholders' Equity Summary | Metric (in thousands) | Dec 31, 2021 | Mar 31, 2022 | | :-------------------- | :----------- | :----------- | | Total Stockholders' Equity | $433,112 | $437,382 | | Net loss | — | $(14,715) | | Stock-based compensation expense | — | $17,931 | | Exercise of stock options | — | $3,782 | | Unrealized loss on short-term investments | — | $(2,517) | [Condensed Consolidated Statements of Cash Flows](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Net cash provided by operating activities decreased significantly in Q1 2022 compared to Q1 2021, mainly due to a higher net loss. Investing activities shifted from a net cash outflow to an inflow, driven by short-term investment maturities and sales. Financing activities remained stable Cash Flow Summary | Cash Flow Activity (in thousands) | Three Months Ended Mar 31, 2022 | Three Months Ended Mar 31, 2021 | Change (in thousands) | | :-------------------------------- | :------------------------------ | :------------------------------ | :-------------------- | | Net cash provided by operating activities | $13,800 | $28,685 | $(14,885) | | Net cash provided by (used in) investing activities | $5,197 | $(6,094) | $11,291 | | Net cash provided by financing activities | $3,500 | $3,573 | $(73) | | Net increase in cash and cash equivalents | $22,500 | $26,178 | $(3,678) | | Cash and cash equivalents at end of period | $93,681 | $120,791 | $(27,110) | [Notes to Unaudited Condensed Consolidated Financial Statements](index=7&type=section&id=Notes%20to%20Unaudited%20Condensed%20Consolidated%20Financial%20Statements) The notes provide detailed explanations of the company's financial statements, covering its business operations, significant accounting policies, specific asset and liability compositions, fair value measurements, lease agreements, debt obligations, stockholders' equity, employee benefits, income taxes, segment reporting, and commitments and contingencies [1. Organization and Basis of Presentation](index=7&type=section&id=1.%20Organization%20and%20Basis%20of%20Presentation) Tandem Diabetes Care, Inc. is a Delaware-incorporated medical device company specializing in technology solutions for diabetes, primarily the t:slim X2 Insulin Delivery System and complementary digital health offerings. The unaudited condensed consolidated financial statements are prepared in accordance with U.S. GAAP, with reclassifications made for common stock warrants and long-term deferred revenue - Tandem Diabetes Care, Inc. is a medical device company focused on the design, development, and commercialization of technology solutions for people living with diabetes[19](index=19&type=chunk) - The company's flagship product is the t:slim X2 Insulin Delivery System, which features remote software updates and continuous glucose monitoring (CGM) integration[20](index=20&type=chunk) - Reclassifications were made in Q1 2022 to separately report common stock warrants as a component of other current liabilities and deferred revenue long-term on the condensed consolidated balance sheet[24](index=24&type=chunk) [2. Summary of Significant Accounting Policies](index=8&type=section&id=2.%20Summary%20of%20Significant%20Accounting%20Policies) The company's significant accounting policies remained materially unchanged from its 2021 Annual Report, covering areas such as estimates, accounts receivable, fair value measurements, operating leases, equity investments, intangible assets, revenue recognition, warranty reserves, stock-based compensation, and net loss per share. The company early adopted ASU 2020-06 on January 1, 2021, simplifying convertible instrument accounting - No material changes to the company's significant accounting policies occurred during the three months ended March 31, 2022, compared to those disclosed in the 2021 Annual Report[25](index=25&type=chunk) - The company early adopted ASU No. 2020-06, 'Accounting for Convertible Instruments and Contracts in an Entity's Own Equity,' on January 1, 2021, using the modified retrospective method[42](index=42&type=chunk) - The adoption of ASU 2020-06 resulted in a net reduction to accumulated deficit of **$9.0 million**, a decrease to additional paid-in capital of **$85.8 million**, and an increase to convertible senior notes, net - long-term of **$76.8 million**[42](index=42&type=chunk) [3. Short-Term Investments](index=11&type=section&id=3.%20Short-Term%20Investments) The company invests in marketable securities, primarily debt instruments, classified as available-for-sale. The estimated fair value of these investments decreased from **$552.6 million** at December 31, 2021, to **$541.7 million** at March 31, 2022, with unrealized losses attributed to increased market interest rates rather than credit risk Short-Term Investment Portfolio | Investment Type | Estimated Fair Value (Mar 31, 2022, in thousands) | Estimated Fair Value (Dec 31, 2021, in thousands) | | :---------------------- | :------------------------------------------ | :------------------------------------------ | | U.S. Treasury securities | $293,685 | $221,724 | | Commercial paper | $156,711 | $218,381 | | Corporate debt securities | $51,459 | $58,836 | | U.S. Government-sponsored enterprises | $36,855 | $50,686 | | Supranational bonds | $3,000 | $3,003 | | Total | $541,710 | $552,630 | - Unrealized losses on available-for-sale debt securities at March 31, 2022, were primarily due to the recent increase in market interest rates, and are not considered credit losses[45](index=45&type=chunk) [4. Composition of Certain Financial Statement Items](index=12&type=section&id=4.%20Composition%20of%20Certain%20Financial%20Statement%20Items) Accounts receivable, net, decreased by **14.98%** from December 31, 2021, to March 31, 2022, while the allowance for credit losses slightly increased. Inventories saw a **16.68%** increase over the same period Key Financial Statement Items | Metric (in thousands) | Mar 31, 2022 | Dec 31, 2021 | Change (in thousands) | % Change | | :-------------------- | :----------- | :----------- | :-------------------- | :------- | | Accounts receivable, net | $94,133 | $110,725 | $(16,592) | -14.98% | | Allowance for credit losses | $4,344 | $4,249 | $95 | 2.24% | | Total inventories | $79,987 | $68,551 | $11,436 | 16.68% | [5. Fair Value Measurements](index=13&type=section&id=5.%20Fair%20Value%20Measurements) The company categorizes its financial assets and liabilities into a three-tier fair value hierarchy. As of March 31, 2022, total assets measured at fair value were **$586.6 million**, primarily in Level 1 and Level 2. Level 3 liabilities, consisting of common stock warrants, decreased in fair value from **$147k** to **$113k**, valued using a Black-Scholes pricing model Fair Value Measurements Summary | Metric (in thousands) | Mar 31, 2022 | Dec 31, 2021 | Change (in thousands) | | :-------------------- | :----------- | :----------- | :-------------------- | | Total assets at fair value | $586,615 | $600,916 | $(14,301) | | Total liabilities at fair value (Common stock warrants) | $113 | $147 | $(34) | - The company's Level 3 liabilities include Series A warrants, which are reassessed at each reporting date using a Black-Scholes pricing model[52](index=52&type=chunk)[54](index=54&type=chunk) - The fair value of common stock warrants decreased by **$34k** from December 31, 2021, to March 31, 2022[54](index=54&type=chunk) [6. Leases](index=15&type=section&id=6.%20Leases) The company holds operating leases for various facilities and equipment. In Q1 2022, the Phase I Commencement Date for the Tech Center Lease occurred, resulting in the recognition of **$107.5 million** in right-of-use assets and corresponding operating lease liabilities. Total lease costs increased by **50.4%** year-over-year - The Phase I Commencement Date for the Tech Center Lease occurred in March 2022, leading to the recognition of **$107.5 million** in right-of-use leased assets and corresponding operating lease liabilities[61](index=61&type=chunk) Lease Cost Summary | Lease Cost (in thousands) | Three Months Ended Mar 31, 2022 | Three Months Ended Mar 31, 2021 | Change (in thousands) | % Change | | :------------------------ | :------------------------------ | :------------------------------ | :-------------------- | :------- | | Operating lease cost | $3,018 | $2,006 | $1,012 | 50.45% | | Short-term lease cost | $34 | $22 | $12 | 54.55% | | Total lease cost | $3,052 | $2,028 | $1,024 | 50.49% | - The weighted-average remaining lease term for operating leases was **11.2 years** as of March 31, 2022, with a weighted-average discount rate of **5.4%**[63](index=63&type=chunk) [7. Debt](index=18&type=section&id=7.%20Debt) The company has **$287.5 million** in **1.50%** Convertible Senior Notes due 2025, with a net carrying amount of **$281.9 million** as of March 31, 2022. Interest expense related to these notes was **$1.5 million** for Q1 2022. The company also entered into Capped Call Transactions to reduce potential dilution from note conversions - The company issued **$287.5 million** principal amount of **1.50%** Convertible Senior Notes due 2025 in May 2020[67](index=67&type=chunk) Convertible Senior Notes Details | Metric (in thousands) | Mar 31, 2022 | Dec 31, 2021 | | :-------------------- | :----------- | :----------- | | Principal amount | $287,500 | $287,500 | | Unamortized debt issuance costs | $(5,595) | $(6,033) | | Net carrying amount | $281,905 | $281,467 | Interest Expense (in thousands) | Interest Expense (in thousands) | Three Months Ended Mar 31, 2022 | Three Months Ended Mar 31, 2021 | | :------------------------------ | :------------------------------ | :------------------------------ | | Contractual interest expense | $1,078 | $1,078 | | Amortization of debt issuance costs | $438 | $428 | | Total interest expense | $1,516 | $1,506 | [8. Stockholders' Equity](index=20&type=section&id=8.%20Stockholders'%20Equity) As of March 31, 2022, the company had **10.7 million** shares reserved for future issuance under various plans, including convertible notes, warrants, stock options, and RSUs. Total stock-based compensation expense for Q1 2022 was **$18.1 million**, allocated across cost of sales, SG&A, and R&D Shares Reserved and Stock-Based Compensation | Shares Reserved (in thousands) | Mar 31, 2022 | | :----------------------------- | :----------- | | Conversion of Convertible Senior Notes | 2,554 | | Outstanding warrants | 211 | | Outstanding stock options | 4,671 | | Unvested restricted stock units | 772 | | ESPP awards | 1,216 | | Future equity award grants | 1,258 | | Total | 10,682 | Stock-Based Compensation Expense (in thousands) | Stock-Based Compensation Expense (in thousands) | Three Months Ended Mar 31, 2022 | Three Months Ended Mar 31, 2021 | | :---------------------------------------------- | :------------------------------ | :------------------------------ | | Cost of sales | $1,846 | $1,476 | | Selling, general & administrative | $11,854 | $9,409 | | Research and development | $4,410 | $2,062 | | Total stock-based compensation expense | $18,110 | $12,947 | [9. Employee Benefits](index=21&type=section&id=9.%20Employee%20Benefits) The company offers a 401(k) plan to eligible U.S. employees, and began making discretionary matching contributions in the first quarter of 2022 - The company initiated a discretionary matching contribution to its employee 401(k) plan in the first quarter of 2022[87](index=87&type=chunk) [10. Income Taxes](index=22&type=section&id=10.%20Income%20Taxes) For the three months ended March 31, 2022, the company recognized an income tax benefit of **$1.7 million** on a pre-tax loss of **$16.4 million**, primarily due to its loss position. A full valuation allowance is maintained against net deferred tax assets Income Tax Metrics | Income Tax Metric (in thousands) | Three Months Ended Mar 31, 2022 | Three Months Ended Mar 31, 2021 | | :------------------------------- | :------------------------------ | :------------------------------ | | Pre-tax loss | $(16,439) | $(5,161) | | Income tax benefit | $(1,724) | $(117) | - The company continues to maintain a full valuation allowance against its net deferred tax assets as of March 31, 2022[89](index=89&type=chunk) [11. Business Segment and Geographic Information](index=22&type=section&id=11.%20Business%20Segment%20and%20Geographic%20Information) The company operates as a single business segment focused on insulin pump products. Revenue is disaggregated by geographic region and customer sales channel, with the United States accounting for the majority of sales, and distributors being the primary sales channel both domestically and internationally - The company views its operations and manages its business as one segment and a single reporting unit[90](index=90&type=chunk) Sales by Geographic Region | Geographic Region (in thousands) | Three Months Ended Mar 31, 2022 | Three Months Ended Mar 31, 2021 | | :------------------------------- | :------------------------------ | :------------------------------ | | United States | $131,283 | $103,339 | | Outside the United States | $44,624 | $37,698 | | Total Sales | $175,907 | $141,037 | - Sales to distributors accounted for **65%** of total United States sales and **96%** of total sales outside the United States for the three months ended March 31, 2022[93](index=93&type=chunk) [12. Commitments and Contingencies](index=23&type=section&id=12.%20Commitments%20and%20Contingencies) The company is involved in legal proceedings, including a data breach class action lawsuit with an uncertain outcome and a wage/labor class action that has been settled. It also maintains a **$4.9 million** standby letter of credit for an operating lease - The company is a defendant in a consolidated class action lawsuit (Joseph Deluna et al. v. Tandem Diabetes Care, Inc.) stemming from a May 2020 data breach, with the ultimate outcome and amount of possible losses currently undeterminable[94](index=94&type=chunk) - A class action lawsuit regarding wage and labor violations (Buck Walsh v. Tandem Diabetes Care, Inc.) has been settled, with preliminary approval received in October 2021 and final approval of material terms in April 2022[95](index=95&type=chunk) - The company has a **$4.9 million** unsecured irrevocable standby letter of credit arrangement with a bank in connection with one of its operating leases[98](index=98&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=25&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) This section provides management's perspective on the company's financial condition and results of operations, highlighting significant sales growth, product development initiatives, the ongoing impact of the COVID-19 pandemic, and key trends affecting financial performance. It also details the components of revenue and expenses, and discusses liquidity and capital resources [Overview](index=25&type=section&id=Overview) Tandem Diabetes Care is a medical device company focused on diabetes technology solutions, with its t:slim X2 Insulin Delivery System as the flagship product. The company has rapidly innovated, launching seven insulin pump configurations in the US since 2012. Key advancements include Control-IQ technology and the FDA-cleared smartphone app for insulin bolusing. For Q1 2022, sales reached **$175.9 million**, with a net loss of **$14.7 million** - The t:slim X2 Insulin Delivery System, the company's flagship pump platform, accounts for **100%** of new pump shipments and is capable of remote software updates[107](index=107&type=chunk)[109](index=109&type=chunk) - The Control-IQ technology, an advanced hybrid-closed loop feature, is used by over **200,000** t:slim X2 users and was the first FDA-cleared system to deliver automatic correction boluses[108](index=108&type=chunk) - In February 2022, the FDA cleared the t:slim X2 pump for users to bolus insulin from a compatible smartphone, marking the first-ever FDA-cleared smartphone app for initiating insulin delivery on both iOS and Android[110](index=110&type=chunk) Consolidated Sales and Net Loss | Metric (in millions) | Three Months Ended Mar 31, 2022 | Three Months Ended Mar 31, 2021 | | :------------------- | :------------------------------ | :------------------------------ | | Consolidated Sales | $175.9 | $141.0 | | Net Loss | $(14.7) | $(5.0) | | Pump Sales % of Total Worldwide Sales | 54% | 58% | [COVID-19 Global Pandemic Impact and Considerations](index=26&type=section&id=COVID-19%20Global%20Pandemic%20Impact%20and%20Considerations) The COVID-19 pandemic has caused significant variability in sales, supply chain constraints (e.g., semiconductors, custom components), labor shortages, and regulatory delays. The company has adapted with remote/hybrid work models and safety measures, but anticipates continued unpredictable impacts on sales and operations - The COVID-19 pandemic has led to fluctuations in sales, supply chain constraints (e.g., global shortages of semiconductors, copper, paper, custom components), and labor shortages[113](index=113&type=chunk)[115](index=115&type=chunk)[116](index=116&type=chunk) - Regulatory delays, particularly with the FDA, have impacted product development and launch timelines due to prioritization of COVID-related products[116](index=116&type=chunk) - The company has implemented a hybrid return-to-office strategy in Q1 2022, balancing remote and in-person interactions for sales and training, and maintaining safety measures for on-site manufacturing[117](index=117&type=chunk)[118](index=118&type=chunk) [Products Under Development](index=27&type=section&id=Products%20Under%20Development) The company is advancing its product pipeline across three pillars: delivery devices, device software, and data/insights. Key developments include the smaller Tandem Mobi pump, the t:slim X3 with enhanced technology, advancements in Control-IQ algorithms, expanded mobile control, and integrations with Dexcom G7 and Abbott CGM technologies. The new Tandem Source data management platform is also in limited testing - The Tandem Mobi (formerly t:sport) is being designed as a smaller, waterproof insulin pump with a **200-unit** cartridge, on-pump bolus button, inductive charging, an AID algorithm, and full pump-control from a mobile application[122](index=122&type=chunk) - The t:slim X3 will feature a modernized user interface, enhanced processing power, increased battery life, improved durability, and wireless software update capabilities[123](index=123&type=chunk) - The company is conducting clinical studies to expand Control-IQ technology indications to include type 1 diabetes ages 2-5 and type 2 diabetes, and is collaborating with Dexcom for G7 CGM integration and Abbott for integrated diabetes solutions[126](index=126&type=chunk)[129](index=129&type=chunk)[130](index=130&type=chunk) - Tandem Source, a second-generation web-based data management application, is being developed as a single global platform to enhance clinical data visualization and customization, with limited testing initiated in the United Kingdom[132](index=132&type=chunk) [Pump Shipments](index=29&type=section&id=Pump%20Shipments) Pump shipments are a key metric, with over **350,000** units shipped worldwide in the past four years. In Q1 2022, worldwide pump shipments increased by **11%** year-over-year, driven by strong demand in both the United States and international markets - The company has shipped over **350,000** insulin pumps worldwide in the past four years, representing its estimated global in-warranty installed customer base[135](index=135&type=chunk) Worldwide Pump Shipments | Region | Three Months Ended Mar 31, 2022 | Three Months Ended Mar 31, 2021 | Change | % Change | | :----- | :------------------------------ | :------------------------------ | :----- | :------- | | United States | 18,658 | 16,644 | 2,014 | 12.10% | | Outside the United States | 9,437 | 8,708 | 729 | 8.37% | | Total Worldwide | 28,095 | 25,352 | 2,743 | 10.82% | [Trends Impacting Financial Results](index=30&type=section&id=Trends%20Impacting%20Financial%20Results) The company has experienced considerable sales growth since 2012, achieving its first full-year operating profit in 2021, but anticipates continued quarterly fluctuations. Key factors influencing financial results include market acceptance, new product introductions, seasonality, the COVID-19 pandemic, competitive dynamics, reimbursement policies, and legal/regulatory matters. Long-term profitability aims to leverage infrastructure investments and drive sales growth - The company achieved its first operating profit on a full-year basis in 2021, but expects operating results to continue fluctuating quarterly[138](index=138&type=chunk)[140](index=140&type=chunk) - Financial results are impacted by market acceptance of products, new product introductions, seasonality in the United States (annual insurance deductibles), the COVID-19 pandemic, and changes in the competitive landscape[139](index=139&type=chunk) - Long-term goals include achieving sustained profitability by driving incremental sales growth worldwide, meeting pump renewal sales objectives, maximizing manufacturing efficiencies, and leveraging investments in sales, clinical, marketing, and customer support[140](index=140&type=chunk) [Components of Results of Operations](index=31&type=section&id=Components%20of%20Results%20of%20Operations) This section details the primary drivers of the company's sales, cost of sales, and operating expenses. Sales are generated from insulin pumps and related disposables, primarily through distributors, with US sales showing seasonality. Gross margins are expected to improve with increased volumes but face pressure from supply chain costs. SG&A and R&D expenses are projected to rise due to growth and product development, while other income/expense and income tax benefit are also discussed - Sales are primarily derived from the t:slim X2 insulin pump and disposable insulin cartridges and infusion sets, sold through national and regional distributors in the United States and distribution partners internationally[141](index=141&type=chunk)[142](index=142&type=chunk)[143](index=143&type=chunk) - U.S. pump shipments are historically weighted towards the second half of the year, with the highest percentage in the fourth quarter due to insurance reimbursement cycles, while international sales are less seasonal but impacted by other factors[144](index=144&type=chunk) - Gross margin percentage is expected to improve long-term with increased sales and production volumes, but currently faces pressure from increased supply chain and material costs due to the global pandemic[148](index=148&type=chunk)[161](index=161&type=chunk) - Selling, General and Administrative (SG&A) and Research and Development (R&D) expenses are anticipated to increase due to growth in customer base, expansion of sales territories, product development efforts, and clinical trials[150](index=150&type=chunk)[151](index=151&type=chunk) [Results of Operations (Comparison of the Three Months Ended March 31, 2022 and 2021)](index=34&type=section&id=Results%20of%20Operations) For Q1 2022, total sales increased by **24.7%** to **$175.9 million**, driven by an **11%** rise in worldwide pump shipments and a **35%** increase in pump-related supply sales. Gross profit grew by **24.3%** to **$91.1 million**, maintaining a **52%** gross margin. Operating expenses surged, with SG&A up **25%** to **$73.3 million** and R&D up **85%** to **$33.2 million**, leading to a significantly higher operating loss of **$15.3 million** and a net loss of **$14.7 million** Key Operating Results Comparison | Metric (in thousands) | Three Months Ended Mar 31, 2022 | Three Months Ended Mar 31, 2021 | Change (in thousands) | % Change | | :-------------------- | :------------------------------ | :------------------------------ | :-------------------- | :------- | | Total Sales | $175,907 | $141,037 | $34,870 | 24.72% | | Worldwide Pump Shipments | 28,095 | 25,352 | 2,743 | 10.82% | | Pump-related Supply Sales Growth | 35% | N/A | N/A | N/A | | Gross Profit | $91,093 | $73,287 | $17,806 | 24.29% | | Gross Margin | 52% | 52% | 0% | 0.00% | | SG&A Expenses | $73,271 | $58,563 | $14,708 | 25.12% | | R&D Expenses | $33,160 | $17,961 | $15,199 | 84.62% | | Operating Loss | $(15,338) | $(3,237) | $(12,101) | 373.80% | | Net Loss | $(14,715) | $(5,044) | $(9,671) | 191.74% | - The increase in SG&A expenses was primarily due to a **$12.8 million** increase in employee-related expenses to support additional sales territories and a growing customer base[162](index=162&type=chunk) - The increase in R&D expenses was primarily due to an **$8.9 million** increase in employee-related expenses for product development and a **$6.3 million** increase in other non-employee discretionary spending, including clinical trial expenses[163](index=163&type=chunk) [Liquidity and Capital Resources](index=36&type=section&id=Liquidity%20and%20Capital%20Resources) As of March 31, 2022, the company held **$635.4 million** in cash and short-term investments, deemed sufficient for ongoing core business activities. Net cash provided by operating activities decreased to **$13.8 million** in Q1 2022 from **$28.7 million** in Q1 2021, mainly due to a higher net loss and working capital changes. Investing activities generated **$5.2 million**, a shift from a net use in the prior year. The company may seek additional financing in the future to support growth and strategic objectives - As of March 31, 2022, the company had **$635.4 million** in cash and cash equivalents and short-term investments, which management believes will be sufficient to fund ongoing core business activities[165](index=165&type=chunk) Cash Flow Activities | Cash Flow Activity (in thousands) | Three Months Ended Mar 31, 2022 | Three Months Ended Mar 31, 2021 | | :-------------------------------- | :------------------------------ | :------------------------------ | | Net cash provided by operating activities | $13,800 | $28,685 | | Net cash provided by (used in) investing activities | $5,197 | $(6,094) | | Net cash provided by financing activities | $3,500 | $3,573 | - The reduction in net cash provided by operating activities in Q1 2022 was primarily due to a **$9.7 million** increase in net loss and working capital changes, including decreased accounts receivable and increased inventories[167](index=167&type=chunk) - Future capital requirements are subject to various factors, and the company may seek additional capital through equity or debt offerings, which could result in dilution for existing stockholders[169](index=169&type=chunk)[170](index=170&type=chunk) [Indebtedness](index=38&type=section&id=Indebtedness) The company's primary indebtedness consists of **$287.5 million** in **1.50%** Convertible Senior Notes due 2025. Contractual interest payments total **$14.4 million**, with the principal amount due in 2025. The notes may be settled in cash, common stock, or a combination - The company has **$287.5 million** principal amount of **1.50%** Convertible Senior Notes due 2025[171](index=171&type=chunk) Debt Obligations | Debt Obligation (in thousands) | Total | Remaining in 2022 | 2023 | 2024 | 2025 | | :----------------------------- | :---- | :---------------- | :--- | :--- | :--- | | Contractual interest | $14,357 | $4,313 | $4,313 | $4,313 | $1,418 | | Principal amount of convertible senior notes | $287,500 | — | — | — | $287,500 | - The Convertible Senior Notes may be settled in cash, shares of common stock, or a combination, at the company's election[172](index=172&type=chunk) [Critical Accounting Policies](index=38&type=section&id=Critical%20Accounting%20Policies) There have been no material changes to the company's critical accounting policies and estimates from those disclosed in its Annual Report on Form 10-K for the year ended December 31, 2021 - No material changes to critical accounting policies and estimates were reported from the 2021 Annual Report[174](index=174&type=chunk) [Off-Balance Sheet Arrangements](index=38&type=section&id=Off-Balance%20Sheet%20Arrangements) As of March 31, 2022, the company is party to certain standby letter of credit arrangements, including a **$4.9 million** unsecured irrevocable standby letter of credit for operating lease obligations - The company has a **$4.9 million** unsecured irrevocable standby letter of credit arrangement with a bank in connection with one of its operating leases[175](index=175&type=chunk)[98](index=98&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=39&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company is exposed to credit and interest rate risks from its marketable securities, with unrealized losses primarily due to rising interest rates rather than credit issues. Its Convertible Senior Notes bear a fixed interest rate, mitigating interest rate risk. Foreign currency exchange rate risk is limited, mainly to Canadian operations, and may be hedged with derivative instruments - Unrealized losses on available-for-sale debt securities at March 31, 2022, were primarily due to the recent increase in market interest rates, not credit losses[177](index=177&type=chunk) - The company's Convertible Senior Notes bear a fixed interest rate of **1.50%** per year, meaning it is not subject to interest rate risk from these notes[180](index=180&type=chunk) - Foreign currency exchange rate risk is currently limited to the company's operations in Canada, and it may use derivative instruments like foreign currency exchange forward contracts to hedge this risk[181](index=181&type=chunk) [Item 4. Controls and Procedures](index=39&type=section&id=Item%204.%20Controls%20and%20Procedures) Management, including the CEO and CFO, concluded that the company's disclosure controls and procedures were effective at a reasonable assurance level as of March 31, 2022. There were no material changes in internal control over financial reporting during the quarter - The company's principal executive officer and principal financial officer concluded that disclosure controls and procedures were effective at a reasonable assurance level as of March 31, 2022[183](index=183&type=chunk) - There were no changes in internal control over financial reporting during the quarter ended March 31, 2022, that materially affected, or are reasonably likely to materially affect, internal control over financial reporting[184](index=184&type=chunk) PART II. OTHER INFORMATION [Item 1. Legal Proceedings](index=41&type=section&id=Item%201.%20Legal%20Proceedings) The company is involved in a data breach class action lawsuit (Joseph Deluna et al. v. Tandem Diabetes Care, Inc.) where the ultimate outcome and potential losses are currently undeterminable. A wage and labor class action lawsuit (Buck Walsh v. Tandem Diabetes Care, Inc.) has been settled, with final disbursement pending. Other routine legal proceedings are not expected to have a material adverse effect - The company is defending a consolidated class action lawsuit (Joseph Deluna et al. v. Tandem Diabetes Care, Inc.) related to a data breach in January 2020, with the ultimate outcome and potential losses currently undeterminable[187](index=187&type=chunk)[189](index=189&type=chunk) - A class action lawsuit (Buck Walsh v. Tandem Diabetes Care, Inc.) concerning wage and labor violations has been settled, with the material terms approved by an independent arbitrator on April 18, 2022, and final disbursement anticipated[188](index=188&type=chunk) [Item 1A. Risk Factors](index=41&type=section&id=Item%201A.%20Risk%20Factors) This section outlines significant risks associated with an investment in the company, categorized into business and industry, future financings and financial results, intellectual property and potential litigation, legal and regulatory environment, common stock, and convertible senior notes. These risks include the company's history of operating losses, reliance on insulin pump sales, impacts of the COVID-19 pandemic, intense competition, regulatory compliance, and potential stock price volatility - The company has incurred significant operating losses since inception and cannot assure sustained profitability[196](index=196&type=chunk) - The business relies heavily on sales of insulin pump products, and any negative factors impacting these sales could adversely affect financial results[201](index=201&type=chunk) - Public health threats like COVID-19 have materially impacted operations, supply chain, and product development timelines, with unpredictable variability expected to continue[204](index=204&type=chunk)[206](index=206&type=chunk)[207](index=207&type=chunk) - The medical device industry is intensely competitive, with major competitors having greater resources and established advantages, posing a risk to the company's ability to compete successfully[211](index=211&type=chunk)[212](index=212&type=chunk)[215](index=215&type=chunk) - Extensive governmental regulation, including FDA requirements and fraud and abuse laws, subjects the company's products and operations to compliance risks, with potential for delays, recalls, or penalties[303](index=303&type=chunk)[305](index=305&type=chunk)[314](index=314&type=chunk)[317](index=317&type=chunk) - The company's common stock price may continue to fluctuate significantly due to various factors, including financial results, new product announcements, regulatory approvals, and general economic conditions[327](index=327&type=chunk) - The company's **$287.5 million** Convertible Senior Notes due 2025 could adversely affect its financial condition, requiring significant cash for servicing and potentially limiting future financing flexibility[339](index=339&type=chunk)[341](index=341&type=chunk) [Item 6. Exhibits](index=77&type=section&id=Item%206.%20Exhibits) This section lists all exhibits filed with the Form 10-Q, including the 2022 Senior Management Cash Bonus Plan, certifications from the CEO and CFO under Sections 302 and 906 of the Sarbanes-Oxley Act, and various XBRL documents - The exhibits include the Tandem Diabetes Care, Inc. 2022 Senior Management Cash Bonus Plan (Exhibit 10.1)[353](index=353&type=chunk) - Certifications from the Chief Executive Officer and Chief Financial Officer are provided pursuant to Section 302 and Section 906 of the Sarbanes-Oxley Act of 2002[353](index=353&type=chunk) - Various XBRL (eXtensible Business Reporting Language) documents, including the Instance Document, Taxonomy Extension Schema, Calculation Linkbase, Definition Linkbase, Label Linkbase, and Presentation Linkbase, are filed[353](index=353&type=chunk)

Tandem Diabetes Care, Inc. (NASDAQ:TNDM) Q4 2021 Earnings Conference Call February 22, 2022 4:30 PM ET Company Participants Susan Morrison - EVP and CAO John Sheridan - President and CEO Leigh Vosseller - EVP and CFO Brian Hansen - EVP and Chief Commercial Officer Conference Call Participants Chris Pasquale - Guggenheim Brooks O'Neil - Lake Street Capital Alex Nowak - Craig-Hallum Capital Steve Lichtman - Oppenheimer and Company Matthew O'Brien - Piper Sandler Matt Taylor - UBS Danielle Antalffy - SVB Leeri ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 _________________________________________________________________ FORM 10-K _________________________________________________________________ ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2021 or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission File Number 001-36189 ______ ...

Tandem Diabetes Care Company Overview NOVEMBER 3, 2021 Safe Harbor CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS Certain statements in this presentation constitute forward-looking statements, including, without limitation, statements about: the perceived advantages of our products relative to competitive products and technologies; our anticipated growth and other measures of future operating results and financial performance; the development and commercialization of new products; our ability to secur ...

Tandem Diabetes Care, Inc. (NASDAQ:TNDM) Q3 2021 Earnings Conference Call November 3, 2021 4:30 PM ET Company Participants Susan Morrison - Executive Vice President and Chief Administrative Officer John Sheridan - President and Chief Executive Officer Leigh Vosseller - Executive Vice President and Chief Financial Officer Conference Call Participants Danielle Antalffy - SVB Leerink Matt Taylor - UBS Travis Steed - Barclays Brooks O'Neil - Lake Street Capital Alex Nowak - Craig-Hallum Capital Chris Pasquale - ...