Tandem Diabetes Care Q3 2025 Conference Call Summary Company Overview - **Company**: Tandem Diabetes Care (NasdaqGM:TNDM) - **Date**: November 11, 2025 - **Context**: Discussion of Q3 2025 results and future outlook Key Points Financial Performance - Q3 2025 results showed solid performance with outperformance relative to market expectations, primarily driven by pricing strategies [2][4] - U.S. pump sales experienced a slight decline year-over-year, indicating challenges in the market [2][4] - Pricing improved in Q3, with mid-single-digit year-over-year growth attributed to the pharmacy channel [5][13] Sales and Market Dynamics - The company is undergoing a transformation in the U.S. market, which has led to some turbulence but also signs of improved sales rep productivity [4][11] - September 2025 was noted as the strongest month of the quarter, with expectations for continued sales momentum into Q4 [6][12] - Pharmacy sales accounted for 5% of U.S. revenue in Q3, primarily driven by the introduction of t:slim supplies [7][8] Product Pipeline and Innovations - The company is prioritizing the launch of the tubeless Mobi product, expected to be a significant growth driver in 2026 [18][19] - The integration of Mobi with FreeStyle Libre 3 is anticipated, enhancing product offerings [23] - A fully closed-loop pivotal trial is set to begin in 2026, leveraging existing algorithms and clinical data [24][25] Competitive Landscape - The market is characterized by significant growth potential, with new entrants and competition emerging [34][35] - The company acknowledges the presence of competitors but believes in the overall market opportunity for all players [34] Type 2 Diabetes Market Opportunity - The company is expanding its focus on insulin-intensive Type 2 diabetes patients, which represents a significant market opportunity [42][46] - Current penetration of pumps in this segment is around 5%, with expectations to increase to 25-30% over the next few years [47] International Expansion - Tandem is moving towards a direct sales model in certain international markets, anticipating a minimum 30% ASP premium [51][52] - The transition is expected to be accretive to the bottom line, despite initial OPEX increases [52] Operational Efficiency - The company is implementing measures to improve operational efficiency, including automation and process improvements, which are expected to support a larger install base without proportional increases in headcount [56] 2026 Outlook - Gross margins are projected to improve by at least 300 basis points in 2026, driven by increased pump volumes and pricing benefits [54] - The company is optimistic about achieving OPEX leverage through enhanced sales force productivity and restructuring efforts [56] Additional Insights - The company is cautious about the competitive landscape and is monitoring new entrants closely, indicating a need for time to assess their impact [35][37] - The management emphasized the importance of understanding market dynamics and adapting strategies accordingly, particularly in the context of new product launches and market penetration efforts [41][46]