What changed in this filing

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Item 1. Financial Statements

2025-08-06 compared with 2025-04-30 · 218 added, 125 removed, 568 unchanged (38% of the section changed)

3 unchanged sentences

(In thousands, except par value)

March 31, December 31,

June 30, December 31,

Assets (Unaudited) (Note 1)

18 unchanged sentences

Current portion of convertible senior notes, net

40,736 40,670

Operating lease liabilities 19,888 18,208

10 unchanged sentences

Common stock, $ 0.001 par value;

200,000 shares authorized, 66,568 and 66,264 shares issued and outstanding at March 31, 2025 and December 31, 2024, respectively.

200,000 shares authorized, 67,531 and 66,264 shares issued and outstanding at June 30, 2025 and December 31, 2024, respectively.

Additional paid-in capital 1,360,251 1,312,804

Accumulated other comprehensive income (loss)

3,745 ( 1,947 )

Accumulated deficit ( 1,230,781 ) ( 1,047,825 )

5 unchanged sentences

(In thousands, except per share data)

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

2025 2024 2025 2024

Sales $ 240,678 $ 221,910 $ 475,100 $ 413,584

3 unchanged sentences

Selling, general and administrative 109,596 94,242 223,449 184,348

Litigation and settlement expense

19,951 — 19,951 —

Research and development 48,118 49,326 98,333 95,570

4 unchanged sentences

Other income (expense), net:

Interest income and other, net 4,193 5,314

Interest income and other income (expense), net

( 632 ) 2,824 3,561 8,138

Interest expense ( 1,905 ) ( 1,793 ) ( 3,767 ) ( 3,690 )

Loss from equity method investments

( 3,375 ) — ( 6,917 ) —

Loss on extinguishment of debt — — — ( 1,268 )

2 unchanged sentences

( 57,722 ) ( 29,743 ) ( 179,811 ) ( 69,272 )

Income tax expense 8,467 3,186

Income tax expense (benefit)

( 5,322 ) 1,071 3,145 4,257

$ ( 52,400 ) $ ( 30,814 ) $ ( 182,956 ) $ ( 73,529 )

Other comprehensive income (loss):

1 unchanged sentence

$ ( 98 ) $ ( 463 ) $ 325 $ ( 1,759 )

Unrealized loss on cash flow hedges

( 612 ) — ( 612 ) —

Foreign currency translation gains (losses)

10 unchanged sentences

(In thousands)

Three Months Ended March 31, 2025

Three Months Ended June 30, 2025

Common Stock Additional

5 unchanged sentences

Shares Amount

Balance at March 31, 2025 66,568 $ 67 $ 1,333,531 $ 75 $ ( 1,178,381 ) $ 155,292

Exercise of stock options 10 — 171 — — 171

Vesting of restricted stock units, net of shares withheld for taxes 502 1 ( 6,320 ) — — ( 6,319 )

Issuance of common stock for Employee Stock Purchase Plan 451 — 7,194 — — 7,194

Stock-based compensation expense — — 25,675 — — 25,675

Unrealized loss on short-term investments

— — — ( 98 ) — ( 98 )

Unrealized loss on cash flow hedges

— — — ( 612 ) — ( 612 )

Foreign currency translation gains

— — — 4,380 — 4,380

Net loss — — — — ( 52,400 ) ( 52,400 )

Balance at June 30, 2025

67,531 $ 68 $ 1,360,251 $ 3,745 $ ( 1,230,781 ) $ 133,283

Six Months Ended June 30, 2025

Common Stock Additional

Capital Accumulated

Comprehensive

Income (Loss)

Deficit Total

Stockholders’

Shares Amount

Balance at December 31, 2024 66,264 $ 66 $ 1,312,804 $ ( 1,947 ) $ ( 1,047,825 ) $ 263,098

1 unchanged sentence

Vesting of restricted stock units, net of shares withheld for taxes 763 1 ( 11,708 ) — — ( 11,707 )

Issuance of common stock under Employee Stock Purchase Plan 451 1 7,194 — — 7,195

Stock-based compensation expense — — 51,090 — — 51,090

1 unchanged sentence

— — — 325 — 325

Unrealized loss on cash flow hedges

— — — ( 612 ) — ( 612 )

Foreign currency translation gains

1 unchanged sentence

Net loss — — — — ( 182,956 ) ( 182,956 )

Balance at June 30, 2025

67,531 $ 68 $ 1,360,251 $ 3,745 $ ( 1,230,781 ) $ 133,283

See accompanying notes to unaudited condensed consolidated financial statements.

Three Months Ended June 30, 2024

Common Stock Additional

Capital Accumulated

Comprehensive

Deficit Total

Stockholders’

Shares Amount

Balance at March 31, 2024 64,563 $ 65 $ 1,238,449 $ ( 935 ) $ ( 994,515 ) $ 243,064

Exercise of stock options 55 — 1,149 — — 1,149

Vesting of restricted stock units, net of shares withheld for taxes 415 — ( 10,438 ) — — ( 10,438 )

Issuance of common stock for Employee Stock Purchase Plan 402 — 6,286 — — 6,286

Stock-based compensation expense — — 24,946 — — 24,946

Unrealized loss on short-term investments

— — — ( 463 ) — ( 463 )

Three Months Ended March 31, 2024

Foreign currency translation gains

— — — 145 — 145

Net loss — — — — ( 30,814 ) ( 30,814 )

Balance at June 30, 2024

65,435 $ 65 $ 1,260,392 $ ( 1,253 ) $ ( 1,025,329 ) $ 233,875

Six Months Ended June 30, 2024

Common Stock Additional

8 unchanged sentences

Vesting of restricted stock units, net of shares withheld for taxes 518 — ( 12,197 ) — — ( 12,197 )

Issuance of common stock under Employee Stock Purchase Plan 402 — 6,286 — — 6,286

Exercise of common stock warrants — — — — — —

Stock-based compensation expense — — 46,537 — — 46,537

1 unchanged sentence

Unwind of capped call options related to convertible notes due 2025 — — 184 — — 184

Unrealized loss on short-term investments

— — — ( 1,296 ) — ( 1,296 )

Unrealized gain on short-term investments — — — ( 1,759 ) — ( 1,759 )

Foreign currency translation losses — — — ( 863 ) — ( 863 )

Net loss — — — — ( 73,529 ) ( 73,529 )

Balance at March 31, 2024

Balance at June 30, 2024

65,435 $ 65 $ 1,260,392 $ ( 1,253 ) $ ( 1,025,329 ) $ 233,875

3 unchanged sentences

(In thousands)

Three Months Ended March 31,

Six Months Ended June 30,

Operating Activities

18 unchanged sentences

Accounts payable and accrued expenses

6,637 ( 3,369 )

Employee-related liabilities ( 12,649 ) ( 462 )

15 unchanged sentences

— ( 246,123 )

Principal payments on convertible senior notes due 2025

Payment for capped call transactions related to convertible senior notes due 2029

16 unchanged sentences

$ 1,073 $ 1,505

Intangible costs in other long term-liabilities $ 13,300 $ —

See accompanying notes to unaudited condensed consolidated financial statements.

10 unchanged sentences

New software for the insulin pumps may be updated remotely by the individual users as new advancements become available and are compatible with other complementary digital health offerings, such as the Company’s mobile application and cloud-based diabetes management applications.

The Company’s insulin pump products are generally considered durable medical equipment and have an expected lifespan of at least four years .

The Company’s durable insulin pump products generally have an expected lifespan of at least four years .

In addition to insulin pumps, the Company sells single-use components that are used together with the pumps and are replaced every few days, including cartridges for storing and delivering insulin, and infusion sets that connect the insulin pump to a user’s body.

16 unchanged sentences

Summary of Significant Accounting Policies

There have been no material changes to the Company’s significant accounting policies during the three months ended March 31, 2025, as compared to those disclosed in the Annual Report.

There have been no material changes to the Company’s significant accounting policies during the six months ended June 30, 2025, as compared to those disclosed in the Annual Report, except for the addition of the accounting policy related to derivatives and hedging activities, which is included herein.

Use of Estimates

17 unchanged sentences

Amortization of finite-lived intangible assets is recognized over their estimated useful lives on a straight-line basis.

On May 21, 2025, the Company and various Roche entities (collectively “Roche”) entered into a Settlement, Mutual Release and Cross-License Agreement (the “Settlement Agreement”).

The Settlement Agreement resolved all actual or potential patent disputes as of the agreement date, including the actions pending before courts of the Unified Patent Court in France and Germany.

Under the terms of the Settlement Agreement, the Company agreed to pay Roche $ 36.0 million over a four-year period, with an initial cash payment of $ 8.0 million and four equal annual installments thereafter.

The installment payments include approximately $ 4.4 million of imputed interest.

As a result, the Company recorded a $ 31.6 million liability, representing the present value of the total settlement obligation.

Upon payment of the initial installment, which occurred in the second quarter of 2025, both parties granted each other non-exclusive, non-royalty-bearing, non-transferrable, and irrevocable licenses to their respective insulin delivery system-related patents and applications for a period of 10 years.

The Company allocated the present value of the settlement consideration between the value of the licensed patents and the release of past and potential future claims.

Based on a relative fair value approach, $ 13.3 million was capitalized as an intangible asset for the value of the license, which will be amortized over seven years , reflecting the estimated useful life of the acquired patents.

The remaining consideration was expensed as settlement and litigation expense with related legal fees during the three and six months ended June 30, 2025.

The fair value of the licensed patents was estimated using a discounted cash flow model, which incorporated assumptions including projected revenues associated with the licensed technology, a technology migration rate, an estimated royalty rate, and a discount rate.

The fair value of the past damages claimed was estimated based on applicable historical revenues and an estimated royalty rate.

Impairment of Long-Lived Assets

5 unchanged sentences

If actual performance does not meet or exceed projected performance, or if the assumptions used in the model change in the future, the Company may be required to recognize additional impairment charges in future periods.

Other than the impairment of operating lease right-of-use assets recognized in the first quarter of 2025 (see Note 6, “Leases”), there were no other impairments of long-lived assets, including acquired intangible assets, during the three months ended March 31, 2025 and 2024.

Other than the impairment of operating lease right-of-use assets recognized in the first half of 2025 (see Note 6, “Leases”), there were no other impairments of long-lived assets, including acquired intangible assets, during the three and six months ended June 30, 2025 and 2024.

Equity Method Investments

The Company held equity method investments of $ 71.0 million and $ 74.5 million at March 31, 2025 and December 31, 2024, respectively.

The Company held equity method investments of $ 67.6 million and $ 74.5 million at June 30, 2025 and December 31, 2024, respectively.

The Company uses the equity method to account for investments in companies if it owns more than 20% of the investee company’s outstanding equity or the investment provides the Company with the ability to exercise significant influence but not control over the operating and financial policies of the investee.

1 unchanged sentence

The Company may also consider additional relevant factors, such as the presence of other business relationships.

The Company’s condensed consolidated net loss included its proportionate share of the net loss of its equity method investee, which was a loss of $ 3.5 million for the three months ended March 31, 2025.

For the three months ended March 31, 2024, the Company did not hold any equity method investments and therefore did not recognize a share of net income or loss from any equity method investments.

The Company’s condensed consolidated net loss included its proportionate share of the net loss of its equity method investee, which was $ 3.4 million and $ 6.9 million for the three and six months ended June 30, 2025, respectively.

For the three and six months ended June 30, 2024, the Company did not hold any equity method investments and therefore did no t recognize a share of net income or loss from any equity method investments.

Revenue Recognition

28 unchanged sentences

The remaining deferrals were recognized at program expiration on December 31, 2024.

For the three months ended March 31, 2024, the Company deferred $ 1.1 million of pump sales as the result of Tandem Choice.

There was no comparative adjustment to pump sales in the first quarter of 2025.

For the six months ended June 30, 2024, the Company deferred $ 1.1 million of pump sales as the result of Tandem Choice, and recognized incremental sales of $ 0.2 million from individual Tandem Choice fulfillments.

There was no comparative adjustment to pump sales in 2025.

Derivative Instruments and Hedging Activities

The Company records the fair value of derivative instruments as either current assets or current liabilities on the condensed consolidated balance sheets.

Changes in the fair value of derivative instruments are recorded each period in current earnings or other comprehensive income (loss), depending on whether a derivative instrument is designated as part of a hedging transaction.

For a derivative to qualify as a hedge at inception and throughout the hedged period, the Company formally documents the nature and relationships between the hedging instrument and hedged item.

For derivatives formally designated as hedges, the Company assesses both at inception and quarterly thereafter, whether the hedging derivatives are highly effective in offsetting changes in either the fair value or cash flows of the hedged item.

Gains or losses on cash flow hedges are reclassified from other comprehensive income (loss) to earnings when the hedged transaction occurs and affects consolidated results.

If the Company determines that a forecasted transaction is no longer probable of occurring, the Company discontinues hedge accounting and any related unrealized gain or loss on the derivative instrument is recognized in current earnings.

Derivatives that are not designated and do not qualify as hedges are adjusted to fair value through current earnings.

Warranty Reserve

10 unchanged sentences

Warranty expense is recorded as a component of cost of sales in the consolidated statements of operations.

The following table provides a reconciliation of the changes in product warranty liabilities for the three months ended March 31, 2025 and 2024 (in thousands):

Three Months Ended March 31,

The following table provides a reconciliation of the changes in product warranty liabilities for the three and six months ended June 30, 2025 and 2024 (in thousands):

Three Months Ended June 30, Six Months Ended June 30,

2025 2024 2025 2024

Balance at beginning of the period $ 52,210 $ 37,638 $ 51,408 $ 37,173

2 unchanged sentences

Increases (decreases) in warranty estimates

1,645 ( 801 ) 2,021 ( 1,708 )

Balance at end of the period $ 54,203 $ 37,356 $ 54,203 $ 37,356

As of March 31, 2025 and December 31, 2024, total product warranty reserves were included in the following consolidated balance sheet accounts (in thousands):

March 31, 2025 December 31, 2024

As of June 30, 2025 and December 31, 2024, total product warranty reserves were included in the following consolidated balance sheet accounts (in thousands):

June 30, 2025 December 31, 2024

Other current liabilities $ 32,648 $ 31,048

13 unchanged sentences

Dilutive common share equivalents are comprised of stock options and unvested RSUs outstanding under the Company’s stock incentive plans, potential awards to be granted pursuant to the ESPP, and common stock warrants, each calculated using the treasury stock method, and shares issuable upon conversion of the convertible senior notes calculated using the if-converted method.

For the three months ended March 31, 2025 and 2024, there was no difference in the weighted average number of shares used to calculate basic and diluted net loss per share due to the Company’s net loss position in each period.

For the three and six months ended June 30, 2025 and 2024, there was no difference in the weighted average number of shares used to calculate basic and diluted net loss per share due to the Company’s net loss position in each period.

Potentially dilutive securities outstanding and not included in the calculation of diluted net loss per share (because inclusion would be anti-dilutive) are as follows (in thousands, in common stock equivalent shares):

Three Months Ended

June 30, Six Months Ended June 30,

2025 2024 2025 2024

Options to purchase common stock 113 804 114 129

3 unchanged sentences

Convertible senior notes (if-converted) 9,159 9,513 9,335 6,877

12,637 13,892 12,430 10,094

Recently Issued Accounting Pronouncements

11 unchanged sentences

The Company invests in marketable securities primarily consisting of debt instruments of the United States Government, United States Government-sponsored enterprises, and financial institutions and corporations with strong credit ratings.

The following represents a summary of the estimated fair value of short-term investments at March 31, 2025 and December 31, 2024 (in thousands):

At March 31, 2025 Amortized

The following represents a summary of the estimated fair value of short-term investments at June 30, 2025 and December 31, 2024 (in thousands):

At June 30, 2025 Amortized

Cost Gross Unrealized

6 unchanged sentences

Corporate debt securities 70,600 122 ( 10 ) 70,712

Foreign government bonds

3,012 23 — 3,035

Total $ 250,486 $ 825 $ ( 62 ) $ 251,249

11 unchanged sentences

Total $ 368,657 $ 759 $ ( 321 ) $ 369,095

The contractual maturities of available-for-sale debt securities as of March 31, 2025, were as follows (in thousands):

The contractual maturities of available-for-sale debt securities as of June 30, 2025, were as follows (in thousands):

Years to Maturity

At March 31, 2025 Within One Year One to Two Years Two to Three Years

At June 30, 2025 Within One Year One to Two Years Two to Three Years

Estimated Fair Value

3 unchanged sentences

Corporate debt securities 35,147 35,565 — 70,712

Foreign government bonds

— — 3,035 3,035

Total $ 112,018 $ 129,166 $ 10,065 $ 251,249

1 unchanged sentence

The Company reviews the portfolio of available-for-sale debt securities quarterly to determine if any investment is impaired due to changes in credit risk or other potential valuation concerns.

Unrealized losses on available-for-sale debt securities at March 31, 2025 were primarily due to an increase in market interest rates after certain debt securities were purchased, and the balance was not material to the Company’s quarterly results.

Unrealized losses on available-for-sale debt securities at June 30, 2025 were primarily due to an increase in market interest rates after certain debt securities were purchased, and the balance was not material to the Company’s quarterly results.

Composition of Certain Financial Statement Items

Accounts Receivable

Accounts receivable, net consisted of the following at March 31, 2025 and December 31, 2024 (in thousands):

March 31, December 31,

Accounts receivable, net consisted of the following at June 30, 2025 and December 31, 2024 (in thousands):

June 30, December 31,

Accounts receivable $ 134,538 $ 121,836

2 unchanged sentences

Allowance for Credit Losses

The following table provides a reconciliation of the changes in the allowance for estimated accounts receivable credit losses for the three months ended March 31, 2025 and 2024 (in thousands):

The following table provides a reconciliation of the changes in the allowance for estimated accounts receivable credit losses for the three and six months ended June 30, 2025 and 2024 (in thousands):

Three Months Ended

June 30, Six Months Ended June 30,

2025 2024 2025 2024

Balance at beginning of the period $ 7,125 $ 4,923 $ 7,251 $ 4,898

2 unchanged sentences

Balance at end of the period $ 6,095 $ 5,225 $ 6,095 $ 5,225

Inventories consisted of the following at March 31, 2025 and December 31, 2024 (in thousands):

March 31, December 31,

Inventories consisted of the following at June 30, 2025 and December 31, 2024 (in thousands):

June 30, December 31,

Raw materials $ 31,077 $ 32,602

3 unchanged sentences

Fair Value Measurements

The following table presents information about the Company’s financial assets and liabilities measured at fair value on a recurring basis as of March 31, 2025 and December 31, 2024, and indicates the fair value hierarchy of the valuation techniques used by the Company to determine such fair value (in thousands):

The following table presents information about the Company’s financial assets and liabilities measured at fair value on a recurring basis as of June 30, 2025 and December 31, 2024, and indicates the fair value hierarchy of the valuation techniques used by the Company to determine such fair value (in thousands):

Fair Value Measurements at

March 31, 2025

June 30, 2025

Total Level 1 Level 2 Level 3

1 unchanged sentence

$ 53,993 $ 53,993 $ — $ —

Available-for-sale securities:

United States Government-sponsored enterprises 106,009 — 106,009 —

2 unchanged sentences

Corporate debt securities 70,712 — 70,712 —

Foreign government bonds

3,035 — 3,035 —

Total assets $ 305,242 $ 126,796 $ 178,446 $ —

Foreign exchange forward contracts $ 612 $ — $ 612 $ —

Total liabilities $ 612 $ — $ 612 $ —

Fair Value Measurements at

15 unchanged sentences

The Company validates these prices through independent valuation testing and review of portfolio valuations provided by the Company’s investment managers.

There were no transfers into or out of Level 3 assets during the three months ended March 31, 2025 and 2024, respectively.

There were no transfers into or out of Level 3 assets during the three months ended June 30, 2025 and 2024, respectively.

Fair Value of Financial Instruments

1 unchanged sentence

Short-term investments are carried at fair value.

In March 2024, the Company issued $ 316.3 million aggregate principal amount of the Company’s Convertible Senior Notes Due 2029, and repurchased $ 246.7 million of principal of the Company’s Convertible Senior Notes due 2025 (see Note 7, “Debt”).

The Company’s Convertible Senior Notes are carried at amortized cost on the consolidated balance sheets (see Note 7, “Debt”).

1 unchanged sentence

Fair Value Measurements at

March 31, 2025 December 31, 2024

June 30, 2025 December 31, 2024

Convertible Senior Notes due 2025

$ 39,130 $ 39,130

Convertible Senior Notes due 2029

2 unchanged sentences

$ 304,514 $ 446,882

The Company’s leases consist of operating leases for general office space, research and development, manufacturing and warehouse facilities, and equipment.

The Company’s leases consist of operating leases for facility space to support general office, research and development, manufacturing and warehouse facilities, and equipment.

These noncancellable operating leases have initial lease terms from two years to thirteen years .

17 unchanged sentences

The Company also reviewed its assumptions for estimated future sublease income for its Vista Sorrento lease.

As a result, the Company recorded a $ 3.1 million impairment charge in operating expenses, comprised of operating lease impairment charges and write off of fixed assets consisting primarily of leasehold improvements .

As a result, the Company recorded a $ 3.1 million impairment charge in operating expenses in the first quarter of 2025, comprised of operating lease impairment charges and write off of fixed assets consisting primarily of leasehold improvements .

Supplemental Lease Disclosure Information

The Company’s lease costs recorded in the consolidated statements of operations were as follows (in thousands):

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

2025 2024 2025 2024

Operating lease cost (excluding sublease income)

5 unchanged sentences

Total lease cost $ 3,849 $ 3,585 $ 14,206 $ 7,124

Maturities of operating lease liabilities at March 31, 2025 were as follows (in thousands):

Maturities of operating lease liabilities at June 30, 2025 were as follows (in thousands):

Years Ending December 31,

2025 $ 15,838

Thereafter 97,125

5 unchanged sentences

The weighted-average remaining lease term and weighted-average discount rate for operating leases were as follows:

March 31, 2025 December 31, 2024

June 30, 2025 December 31, 2024

Weighted-average remaining lease term (in years) 9.1 9.2

5 unchanged sentences

The Company also paid $ 1.3 million of accrued interest due at time of the note repurchase.

As a result of the repurchase, the Company recognized a $ 1.3 million loss on extinguishment of debt in the condensed consolidated statement of operations for the three months ended March 31, 2024.

As a result of the repurchase, the Company recognized a $ 1.3 million loss on extinguishment of debt in the condensed consolidated statement of operations for the six months ended June 30, 2024.

The loss on extinguishment of debt included the unamortized debt issuance costs related to the portion of the 2025 Notes repurchased.

18 unchanged sentences

In May 2020, the Company completed an offering of $ 287.5 million aggregate principal amount of 1.50 % Convertible Senior Notes due 2025 (the 2025 Notes).

The proceeds from the issuance of the Notes were $ 244.6 million, net of debt issuance costs and cash used to pay the cost of the capped call transactions (Capped Call Transactions) discussed below.

The proceeds from the issuance of the Notes were $ 244.6 million, net of debt issuance costs and cash used to pay the cost of certain related capped call transactions.

In March 2024, the Company repurchased for cash $ 246.7 million aggregate principal amount of the 2025 Notes, concurrently with the pricing of the 2029 Notes in privately negotiated transactions.

The 2025 Notes are the Company’s senior unsecured obligations.

Interest is payable in cash semi-annually in arrears beginning on November 1, 2020, at a rate of 1.50 % per year.

The 2025 Notes mature on May 1, 2025, unless repurchased, redeemed, or converted in accordance with their terms before the maturity date.

As of March 31, 2025, the outstanding balance of the 2025 Notes was classified in current liabilities on the Company’s condensed consolidated balance sheet.

The 2025 Notes are convertible into cash, shares of the Company’s common stock, or a combination of cash and shares of the Company’s common stock, at the Company’s election, at an initial conversion rate of 8.8836 shares of common stock per $1,000 principal amount of the 2025 Notes, which is equivalent to an initial conversion price of $ 112.57 (2025 Notes Conversion Price) per share of the Company’s common stock.

The conversion rate is subject to customary adjustments for certain events as described in the indenture governing the 2025 Notes.

The Company has the option to redeem for cash all or any portion of the 2025 Notes on or after May 6, 2023 if the last reported sale price of the Company’s common stock has been at least 130 % of the 2025 Notes Conversion Price then in effect for at least 20 trading days (whether or not consecutive), including the trading day immediately preceding the date on which the Company provides notice of redemption, during any 30 consecutive trading day period, at a redemption price equal to 100 % of the principal amount of the 2025 Notes to be redeemed, plus accrued and unpaid interest.

No sinking fund is provided for the 2025 Notes.

Upon conversion, the Company will pay or deliver, as the case may be, cash, shares of common stock or a combination of cash and shares of common stock, at the Company’s election, in the manner and subject to the terms and conditions provided in the indenture governing the 2025 Notes.

The 2025 Notes matured in the second quarter of 2025, and the Company settled the balance of $ 40.8 million using existing cash balances.

The net carrying amount of the Company’s convertible senior notes on the condensed consolidated balance sheets consisted of the following (in thousands):

March 31, 2025 December 31, 2024

June 30, 2025 December 31, 2024

Principal amount:

Convertible Senior Notes Due 2025

$ 40,760 $ 40,760

Convertible Senior Notes Due 2029

6 unchanged sentences

current portion

( 40,736 ) ( 40,670 )

Long-term senior convertible notes

$ 309,146 $ 308,266

As of March 31, 2025 and December 31, 2024, the if-converted value of the 2025 Notes did not exceed the principal amount.

As of March 31, 2025, the if-converted value of the 2029 Notes did not exceed the principal amount.

As of June 30, 2025, the if-converted value of the 2029 Notes did no t exceed the principal amount.

As of December 31, 2024, the if-converted value of the 2029 Notes exceeded the principal amount by $ 13.4 million.

The following table summarizes the effective interest rates for each of our convertible senior notes for the periods shown:

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

2025 2024 2025 2024

Effective interest rate:

Convertible Senior Notes Due 2025 (1)

2.2 % 2.2 % 2.2 % 2.2 %

Convertible Senior Notes Due 2029

The following table details interest expense related to the Notes recognized for the three months ended March 31, 2025, and 2024 (in thousands):

Three Months Ended March 31,

2.1 % 2.1 % 2.1 % 2.1 %

(1) The effective interest rate presented represents the rate applicable for the period outstanding.

The 2025 Notes matured in May 2025, and the outstanding principal balance was settled using cash balances.

The following table details interest expense related to the Notes recognized for the three and six months ended June 30, 2025 and 2024 (in thousands):

Three Months Ended June 30, Six Months Ended June 30,

2025 2024 2025 2024

Contractual interest expense

7 unchanged sentences

In connection with the issuance of the 2025 Notes, the Company entered into Capped Call Transactions in May 2020 with certain counterparties at a net cost of $ 34.1 million (2025 Capped Call Transactions).

The 2025 Capped Call Transactions are expected generally to reduce potential dilution to the Common Stock upon any conversion of the 2025 Notes and/or offset any cash payments the Company is required to make in excess of the principal amount of converted 2025 Notes, as the case may be, with such reduction or offset subject to a cap.

The cap price of the 2025 Capped Call Transactions is initially $ 173.18 per share of the Company’s common stock and is subject to certain adjustments under the terms of the 2025 Capped Call Transactions.

In connection with the repurchase of certain 2025 Notes, the Company entered into unwind agreements with the existing option counterparties on March 5, 2024 to terminate a portion of the existing 2025 Capped Call Transactions in a notional amount corresponding to the amount of 2025 Notes repurchased (the Unwind Transactions).

The 2025 Capped Call Transactions were expected generally to reduce potential dilution to the Common Stock upon any conversion of the 2025 Notes and/or offset any cash payments the Company was required to make in excess of the principal amount of converted 2025 Notes, as the case may be, with such reduction or offset subject to a cap.

The cap price of the 2025 Capped Call Transactions was initially $ 173.18 per share of the Company’s common stock and was subject to certain adjustments under the terms of the 2025 Capped Call Transactions.

In connection with the repurchase of certain 2025 Notes, the Company entered into unwind agreements with the existing option counterparties in March 2024 to terminate a portion of the existing 2025 Capped Call Transactions in a notional amount corresponding to the amount of 2025 Notes repurchased (the Unwind Transactions).

In connection with the Unwind Transactions, the Company received $ 0.2 million in cash as a termination payment with respect to the portion of the existing 2025 Capped Call Transactions that were unwound.

The amount received was based generally on the termination values of the unwound portions of the existing 2025 Capped Call Transactions.

For accounting purposes, each of the capped call transactions described above are separate transactions, and not part of the terms of the 2029 Notes or the 2025 Notes.

As these transactions met certain criteria under the applicable accounting guidance, each of the capped call transactions were recorded in stockholders’ equity and were not accounted for as derivatives.

The cost of the transactions was recorded as a reduction of the Company’s additional paid-in capital in the Company’s condensed consolidated balance sheet and will not be remeasured.

The remaining 2025 Capped Call Transactions expired when the 2025 Notes matured in May 2025.

Promissory Note Payable

2 unchanged sentences

The promissory note accrues interest at the rate of 5.0 % per year, and becomes due and payable upon the first sale or license of the commercialized product.

At March 31, 2025 and December 31, 2024, the loan balance, including accrued interest, was $ 4.9 million and $ 4.8 million, respectively, and was included as a component of other long-term liabilities on the condensed consolidated balance sheets.

At June 30, 2025 and December 31, 2024, the loan balance, including accrued interest, was $ 4.9 million and $ 4.8 million, respectively, and was included as a component of other long-term liabilities on the condensed consolidated balance sheets.

Stockholders’ Equity

Shares Reserved for Future Issuance

The following shares of the Company's common stock were reserved for future issuance at March 31, 2025 (in thousands):

The following shares of the Company's common stock were reserved for future issuance at June 30, 2025 (in thousands):

Shares reserved for issuance upon conversion of Convertible Senior Notes 9,335

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Common Stock Warrants

Warrants outstanding to purchase shares of the Company's common stock as of March 31, 2025 were as follows:

Warrants outstanding to purchase shares of the Company's common stock as of June 30, 2025 were as follows:

Issue Date Exercise Price Per Share Warrants Outstanding Expiration Date of Warrants Outstanding

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The following table summarizes the allocation of stock-based compensation expense included in the condensed consolidated statements of operations for all stock-based compensation arrangements (in thousands):

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

2025 2024 2025 2024

Cost of sales $ 1,751 $ 1,760 $ 3,476 $ 3,830

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Total stock-based compensation expense $ 25,642 $ 24,897 $ 51,130 $ 46,936

The total stock-based compensation expense capitalized as part of the cost of the Company’s inventories was $ 1.7 million at March 31, 2025, and $ 1.8 million at December 31, 2024.

The total stock-based compensation expense capitalized as part of the cost of the Company’s inventories was $ 1.7 million at June 30, 2025, and $ 1.8 million at December 31, 2024.

Restricted Stock Units

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The total number of RSUs granted and the respective weighted average grant date fair value were as follows:

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

2025 2024 2025 2024

RSUs granted 1,953,827 1,694,239 2,044,370 2,052,298

Weighted average grant date fair value (per share) $ 20.77 $ 48.30 $ 21.06 $ 44.30

Employee Stock Purchase Plan

The Company records stock-based compensation expense associated with the ESPP using the Black-Scholes option pricing model.

Valuations are performed on the grant date at the beginning of the purchase period, which generally occurs in May and November of each year.

The assumptions used in the Black-Scholes option pricing model for the ESPP were as follows:

Six Months Ended June 30,

Weighted average grant date fair value (per share) $ 10.86 $ 21.45

Risk-free interest rate 4.1 % 5.1 %

Dividend yield 0.0 % 0.0 %

Expected volatility 74.9 % 70.2 %

Expected term (in years) 1.3 1.3

Due to the global nature of the Company’s operations, a portion of revenue and operating expense are denominated in currencies other than the U.S.

dollar, exposing the Company to foreign currency exchange rate fluctuations.

To mitigate the impact of these fluctuations, the Company uses foreign currency forward contracts to hedge a portion of its forecasted international revenue and operating expense.

The Company’s foreign currency forward contracts are denominated primarily in Euros, Swiss Francs and Canadian dollars.

As of June 30, 2025, foreign currency forward contracts outstanding had durations ranging from one to three months .

These contracts are designated as cash flow hedges.

Unrealized gains or losses on these contracts are recorded in accumulated other comprehensive income (loss) (AOCI).

Realized gains and losses of such contracts are recognized in revenue and operating expenses in the same period during which the hedged transactions affect the consolidated results of operations.

The Company recognizes all cash flow hedge reclassifications from AOCI and fair value changes of excluded portions in the same line item in the condensed consolidated statements of income that has been impacted by the hedged item.

The cash flow effects of our derivative contracts in the condensed consolidated statements of cash flows are included in net cash provided by operating activities.

All derivative instruments are used solely for risk management purposes and are not for speculative trading purposes for up to a 90-day duration.

For the periods presented, the Company did not have any non-designated hedges.

The notional value of foreign currency forward contracts outstanding related to forecasted transactions was $ 37.7 million as of June 30, 2025.

The unrealized loss of foreign currency forward contracts was $ 0.6 million for the three and six months ended June 30, 2025.

The following table summarizes the effect of foreign currency forward contracts designated as hedging instruments in our condensed consolidated statements of income (in thousands):

Three and Six Months Ended

June 30, 2025

Net Gains (Losses) Reclassified from AOCI into Operating Income

Designated cash flow hedges:

Revenue $ ( 478 )

Operating expense ( 27 )

The Company did not enter into any foreign currency forward contracts that qualified for hedge accounting in 2024, and therefore there were no derivative assets or liabilities, nor adjustments to revenue or operating expense as a result of cash flow hedges during the three and six months ended June 30, 2024.

Employee Benefits

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Under the terms of the plan, eligible employees may make voluntary contributions as a percent of compensation and the Company may elect to match a discretionary percentage of employee contributions.

For the three months ended March 31, 2025, the Company recognized income tax expense of $ 8.5 million on a pre-tax loss of $ 122.1 million.

The Company calculated the provision for income taxes for the three months ended March 31, 2025 by applying an estimate of the annual effective tax rate for the full year to ordinary loss adjusted by the tax impact of discrete items.

Income tax expense for the three months ended March 31, 2025 was primarily attributable to federal, state and foreign income tax expense as a result of current taxable income in certain jurisdictions.

For the three months ended March 31, 2024, the Company recognized income tax expense of $ 3.2 million on a pre-tax loss of $ 39.5 million.

Income tax expense for the three months ended March 31, 2024 was primarily attributable to federal, state and foreign income tax expense as a result of current taxable income in certain jurisdictions.

The Company calculated the provision for three months ended March 31, 2024 by applying an estimate of the annual effective tax rate for the full year to ordinary income (loss) adjusted by the tax impact of discrete items.

The Company continues to maintain a full valuation allowance against its net deferred tax assets as of March 31, 2025, based on the current assessment that it is not more likely than not these future benefits will be realized before expiration.

For the three and six months ended June 30, 2025, the Company recognized income tax benefit of $ 5.3 million and tax expense of $ 3.1 million, respectively, on a pre-tax loss of $ 57.7 million and $ 179.8 million, respectively.

The Company calculated the benefit and provision for income taxes for the three and six months ended June 30, 2025, respectively, by applying an estimate of the annual effective tax rate for the full year to ordinary loss adjusted by the tax impact of discrete items.

Income tax benefit and expense for the three and six months ended June 30, 2025 was primarily attributable to federal, state and foreign income tax benefit and expense as a result of current taxable losses and income in certain jurisdictions.

For the three and six months ended June 30, 2024, the Company recognized income tax expense of $ 1.1 million and $ 4.3 million, respectively, on a pre-tax loss of $ 29.7 million and $ 69.3 million, respectively.

The Company calculated the provision for three and six months ended June 30, 2024 by applying an estimate of the annual effective tax rate for the full year to ordinary income (loss) adjusted by the tax impact of discrete items.

Income tax expense for the three and six months ended June 30, 2024 was primarily attributable to federal, state and foreign income tax expense as a result of current taxable income in certain jurisdictions.

The Company continues to maintain a full valuation allowance against its net deferred tax assets as of June 30, 2025, based on the current assessment that it is not more likely than not these future benefits will be realized before expiration.

Business Segment and Geographic Information

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The Company’s CODM is the Chief Executive Officer (CEO), who evaluates segment performance based on segment net income (loss) on a consolidated basis.

Segment net income (loss) was consistent with the net loss amounts reported in the Company’s condensed consolidated statement of operations and comprehensive loss for the three months ended March 31, 2025 and 2024.

There were no significant segment expenses that are regularly provided to the CODM other than those reported in the Company’s condensed consolidated statement of operations and comprehensive loss for the three months ended March 31, 2025 and 2024.

The Company’s CODM is provided segment assets information on a consolidated basis for the evaluation of Company performance.

Total segment assets were consistent with total assets reported in the Company’s condensed consolidated balance sheets for March 31, 2025 and December 31, 2024.

Total segment assets were consistent with total assets reported in the Company’s condensed consolidated balance sheets for June 30, 2025 and December 31, 2024.

Disaggregation of Revenue

Segment revenues were consistent with revenue reported in the Company’s condensed consolidated statement of operations and comprehensive loss for the three months ended March 31, 2025 and 2024.

Segment revenues were consistent with revenue reported in the Company’s condensed consolidated statement of operations and comprehensive loss for the three and six months ended June 30, 2025 and 2024.

The Company primarily sells its products through national and regional distributors in the United States on a non-exclusive basis, and through distribution partners outside the United States.

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Revenues by Geographic Region and Customer Sales Channel

During the three months ended March 31, 2025 and 2024, no individual country outside the United States generated revenue that represented more than 10% of total revenue.

During the three and six months ended June 30, 2025 and 2024, no individual country outside the United States generated revenue that represented more than 10% of total revenue.

The table below sets forth revenues for the Company’s two primary geographical markets, based on the geographic location to which its products are shipped (in thousands):

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

2025 2024 2025 2024

United States $ 170,209 $ 156,711 $ 320,841 $ 286,472

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Revenues by Product

During the three months ended March 31, 2025 and 2024, sales by product were as follows (in thousands):

Three Months Ended March 31,

During the three and six months ended June 30, 2025 and 2024, sales by product were as follows (in thousands):

Three Months Ended June 30, Six Months Ended June 30,

2025 2024 2025 2024

$ 111,871 $ 107,875 $ 213,962 $ 195,162

Supplies and other

128,807 113,881 261,138 219,414

Net revenue deferred for Tandem Choice program

Net revenue recognized (deferred) for Tandem Choice program

— 154 — ( 992 )

Total Sales $ 240,678 $ 221,910 475,100 413,584

Sales to distributors accounted for 60 % and 61 % of the Company’s United States sales for the three months ended March 31, 2025 and March 31, 2024, respectively.

Sales to distributors accounted for the vast majority of the Company’s sales outside the United States for the three-month periods ended March 31, 2025 and 2024.

Sales to distributors accounted for 61 % of the Company’s United States sales for both the three and six months ended June 30, 2025 and 63 % and 62 % for the three and six months ended June 30, 2024, respectively.

Sales to distributors accounted for the vast majority of the Company’s sales outside the United States for the three and six-month periods ended June 30, 2025 and 2024.

In December 2022, the Company entered into a share purchase agreement to acquire all of the registered shares of AMF Medical (Original Transaction).

AMF Medical is the original developer of the Sigi Patch Pump, which continued to be under development and was not yet commercially available as of March 31, 2024.

AMF Medical is the original developer of the Sigi Patch Pump, which continued to be under development and was not yet commercially available as of June 30, 2025.

In the first quarter of 2023, the Company completed the acquisition of AMF Medical.

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The total amount of CHF 68 million was recognized as acquired IPR&D in the Company’s condensed consolidated statement of operations and comprehensive loss.

As of March 31, 2025, the remaining CHF 28 million was recorded as a short-term accrued liability for $ 31.1 million on the Company’s condensed consolidated balance sheet.

As of June 30, 2025, the remaining CHF 28 million was recorded as a short-term accrued liability for $ 35.2 million on the Company’s condensed consolidated balance sheet.

Commitments and Contingencies

Legal and Regulatory Matters

In November 2023, at the Unified Patent Court (UPC), Paris Central Division (UPC Paris), we filed a revocation action and an action for a declaration of non-infringement of EP Patent No.

In November 2023, at the Unified Patent Court (UPC), Paris Central Division (UPC Paris), the Company filed a revocation action and an action for a declaration of non-infringement of EP Patent No.

2 196 231 B1 (the ’231 patent) against Roche Diabetes Care GmbH.

While Roche contends that Tandem’s t:slim X2 pump infringes the ‘231 patent, we contend that our t:slim X2 pump does not infringe the ‘231 patent.

Furthermore, we contend that the claims of the ‘231 patent are invalid over the prior art and should be revoked.

In February 2024, Roche filed an infringement action against Tandem and its distributor in Germany at the UPC, Hamburg Local Division (UPC Hamburg) contending that Tandem’s t:slim X2 pump, and the offering, marketing, using, importing, possessing, and supplying of such devices infringes certain claims of the ‘231 patent.

Roche seeks, among other things, damages and other monetary relief, costs and expenses of the legal proceedings, and an order to cease and desist the allegedly infringing activities.

At the UPC Hamburg, Tandem has asserted that the t:slim X2 pump does not infringe the claims of the ‘231 patent and Tandem’s distributor has asserted that the t:slim X2 pump does not infringe the claims of the ‘231 patent and that the claims of the ‘231 patent are invalid and should be revoked.

On November 6, 2024, the UPC Paris held a hearing on Tandem’s action to revoke the claims of the ‘231 patent.

On December 18, 2024, the UPC Paris upheld the patent.

The hearing in Hamburg on invalidity and non-infringement is scheduled for June 12, 2025.

The Company contended that the t:slim X2 pump did not infringe the ‘231 patent and that the claims of the ‘231 patent were invalid over the prior art and should be revoked

In December 2023, F.

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and Tandem’s distributors in Germany, France, the Netherlands and Denmark.

Roche alleges our t:slim X2 insulin pump, and the offering, marketing, using, importing, possessing, and supplying of such devices infringe EP Patent No.

1 970 677 B1 (the ‘677 patent).

While Roche contends that Tandem’s t:slim X2 pump infringes the ‘677 patent, we contend that our t:slim X2 pump does not infringe the ‘677 patent.

Furthermore, we contend that the claims of the ‘677 patent are invalid over the prior art and should be revoked.

Roche seeks, among other things, damages and other monetary relief, costs and expenses of the legal proceedings, and an order to cease and desist the allegedly infringing activities.

On April 9, 2025, the UPC Dusseldorf held a hearing on Roche’s action asserting infringement of the ‘677 patent, Tandem and its distributors’ counterclaims that the t:slim X2 pump does not infringe the ‘677 patent, and Tandem and its distributors’ actions to revoke the claims of the ‘677 patent.

The action seeks unspecified monetary damages and other relief.

The UPC Dusseldorf is expected to issue a ruling on May 22, 2025.

Although the Company intends to vigorously defend against these claims, there is no guarantee that the Company will prevail.

Accordingly, the Company is unable to determine the ultimate outcome of this lawsuit or determine the amount or range of potential losses associated with the lawsuit.

Roche alleged the Company’s t:slim X2 insulin pump, and the offering, marketing, using, importing, possessing, and supplying of such devices infringed EP Patent No.

1 970 677 B1 (the ‘677 patent) and the Company alleged that the t:slim X2 pump did not infringe the ‘677 patent and that the claims of the ‘677 patent were invalid over the prior art and should be revoked.

On May 21, 2025 the Company entered into a Settlement, Mutual Release and Cross-License Agreement to resolve all actual or potential patent disputes with Roche, including related to the matters above (see Intangible Assets Subject to Amortization, Note 2, “Summary of Significant Accounting Policies”).

From time to time, the Company is involved in various other legal proceedings, regulatory matters, and other disputes or claims arising from or related to claims incident to the normal course of the Company’s business activities, including actions with respect to intellectual property, data privacy, employment, regulatory, product liability and contractual matters.

Although the results of such legal proceedings and claims cannot be predicted with certainty, as of March 31, 2025 the Company believes it is not currently a party to any other legal proceedings, regulatory matters, or other disputes or claims for which a material loss was considered probable or for which the amount or range of loss was reasonably estimable.

Although the results of such legal proceedings and claims cannot be predicted with certainty, as of June 30, 2025 the Company believes it is not currently a party to any legal proceedings, regulatory matters, or other disputes or claims for which a material loss was considered probable or for which the amount or range of loss was reasonably estimable.

However, regardless of the merit of the claims raised or the outcome, legal proceedings may have an adverse impact on the Company as a result of defense and settlement costs, diversion of management time and resources, and other factors.

Letters of Credit

As of March 31, 2025, in connection with one of the Company’s operating leases (see Note 6, “Leases”), the Company had a $ 4.9 million unsecured irrevocable standby letter of credit arrangement with a bank, under which the landlord of the building is the beneficiary.

As of June 30, 2025, in connection with one of the Company’s operating leases (see Note 6, “Leases”), the Company had a $ 4.9 million unsecured irrevocable standby letter of credit arrangement with a bank, under which the landlord of the building is the beneficiary.

The Company is required to maintain the standby letter of credit throughout the term of the lease, which expires in April 2035.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements