What changed in this filing

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Item 1A. Risk Factors

2026-08-06 compared with 2026-05-07 · 54 added, 39 removed, 991 unchanged (9% of the section changed)

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• Competing products, therapeutic techniques or other technological developments and breakthroughs for the monitoring, treatment or prevention of diabetes may render our products obsolete or less desirable or reduce the size of our potential market.

• Our sales and marketing efforts depend on independent distributors who are free to market products that compete with our products.

• Our sales and marketing efforts largely depend on independent distributors who are free to market products that compete with our products.

If we are unable to maintain or expand our network of independent distributors, our sales may be negatively affected.

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• Our products and operations are subject to extensive governmental regulation, and failure to comply with applicable requirements could cause our business to suffer.

• New products or modifications to our existing products may require new 510(k) clearances, PMAs, CE Marks or other certifications, or may require us to cease marketing or recall the modified products until clearances, certifications or approvals are obtained.

• New products or modifications to our existing products may require new 510(k) clearances, pre-market approvals (PMAs), CE Marks or other certifications, or may require us to cease marketing or recall the modified products until clearances, certifications or approvals are obtained.

• A recall or suspension of our products, or the discovery of serious safety issues with our products, could have a significant negative impact on us.

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For additional information, see the cautionary note regarding forward-looking statements at the beginning of Part I, Item 2, Management’s Discussion and Analysis of Financial Condition and Results of Operations of this Quarterly Report.

The risk factors set forth below marked with an asterisk (*) next to the title did not appear as separate risk factors in, or contain changes to the similarly titled risk factor included in, Part I, Item 1A of our Annual Report on Form 10-K for the year ended December 31, 2025.

Risks Related to Our Business and Our Industry

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Since our inception in January 2006, we have incurred a significant net loss.

As of March 31, 2026, we had an accumulated deficit of $1.3 billion.

As of June 30, 2026, we had an accumulated deficit of $1.3 billion.

To date, we have funded our operations primarily through cash collected from product sales, private and public offerings of our equity securities, and debt financings.

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Additional increases in our expenses without commensurate increases in sales could significantly increase our operating losses.

The extent of our future operating losses and the timing of our profitability are highly uncertain in light of a number of factors, including the timing of the launch of new products and product features by us and our competitors, market acceptance of our products and competing products by people with insulin-dependent diabetes, their caregivers and healthcare providers, the timing of regulatory clearance, certification, or approval of our products and the products of our competitors, the actual efficiencies gained in our manufacturing processes, and general economic conditions.

The extent of our future operating losses and the timing of our profitability are highly uncertain in light of a number of factors, including:

the timing of the launch of new products and product features by us and our competitors;

market acceptance of our products and competing products by people with insulin-dependent diabetes, their caregivers and healthcare providers;

the timing of regulatory clearance, certification, or approval of our products and the products of our competitors;

the actual efficiencies gained in our manufacturing processes;

and general economic conditions.

Any additional operating losses will have an adverse effect on our stockholders’ equity, and we cannot assure you that we will be able to achieve and sustain profitability.

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• claims that any of our products, or any component thereof, infringes on patent rights or other intellectual property rights of third parties.

In addition, sales of any of our current or future insulin pump products with CGM integration are subject to the continuation of our applicable agreements with Dexcom, Abbott, or other third parties which, under some circumstances, may be subject to termination, with or without cause, on relatively short notice.

In addition, sales of any of our current or future insulin pump products with CGM compatibility are subject to the continuation of our applicable agreements with Dexcom, Abbott, or other third parties which, under some circumstances, may be subject to termination, with or without cause, on relatively short notice.

Sales of our current or future products may also be negatively impacted in the event of any regulatory or legal actions relating to CGM products that are compatible with our pumps, or in the event of any disruption to the availability of the applicable CGM-related supplies, such as sensors or transmitters, in a given market in which our products are sold.

Sales of our products may also be adversely impacted if the CGM products that are compatible with our pumps are not viewed as superior to competing CGM products in markets where our products are sold, or if the price of these products is not competitive with similar products available in the market.

Because we currently rely on sales of our insulin pumps, and related products to generate a significant majority of our sales, any factors that negatively impact sales of these products (or negatively impact the products or components integrated with these products) could adversely affect our business, financial condition and operating results.

Because we currently rely on sales of our insulin pumps, and related products to generate a significant majority of our sales, any factors that negatively impact sales of these products (or negatively impact the products or components compatible with these products) could adversely affect our business, financial condition and operating results.

Furthermore, any disruption in our supply chain could negatively impact our ability to manufacture or otherwise supply sufficient product quantities to meet current customer demand, or any unexpected increase in demand, which could also have the effect of magnifying the negative impact of any of the factors described above.

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We are implementing a multi-channel managed care strategy in the United States, which provides the opportunity for reimbursement through a pharmacy benefit as an alternative to a medical benefit.

Historically, our insulin pump products have primarily been considered durable medical equipment (DME) with an expected lifespan of at least four years.

Historically, our insulin pump products have primarily been considered DME with an expected lifespan of at least four years.

Under the DME reimbursement model, our pumps are generally reimbursed upfront.

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In addition, the competitive environment in which we operate has resulted and may continue to result in competitive pressures on our manufacturers, suppliers, distributors, collaboration partners and other business constituents.

For example, we have entered into development agreements with Dexcom, which provide us with non-exclusive licenses to integrate various generations of Dexcom CGM technology with our insulin pump products.

We have also entered into agreements with Abbott to develop and commercialize integrated diabetes solutions using Abbott’s glucose sensors.

For example, we have entered into development agreements with Dexcom, which provide us with non-exclusive licenses compatible with various generations of Dexcom CGM technology with our insulin pump products.

We have also entered into agreements with Abbott to develop and commercialize compatible diabetes solutions using Abbott’s glucose sensors.

There can be no assurance that our collaborations with Dexcom and Abbott will be successful or that we will not experience delays, business disputes, or other unanticipated challenges.

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In addition, understanding the meaning and significance of such market research responses necessarily requires that analysis be conducted and conclusions be drawn.

We may not be able perform an analysis that yields meaningful results, or the conclusions we draw from the analysis could be misleading or incorrect.

We may not be able to perform an analysis that yields meaningful results, or the conclusions we draw from the analysis could be misleading or incorrect.

Moreover, even if our market research has allowed us to better understand the features and functionality consumers are seeking in an insulin pump to improve management of their diabetes therapy, there can be no assurance that consumers will actually purchase our products or that our competitors will not develop products with similar features.

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Furthermore, general concerns regarding the perceived safety or reliability of any of our products, or any component thereof, may have a similar adverse effect on us.

Our ability to achieve profitability will depend, in part, on our ability to reduce the per-unit cost of our products while also increasing production volume.

Our ability to achieve profitability will depend, in part, on our ability to effectively manage costs and reduce the per-unit cost of our products while also increasing production volume.*

We believe our ability to reduce the per-unit cost of our insulin pumps and related products will have a significant impact on our ability to achieve profitability.

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• our inability to secure product components in a timely manner due to shipping delays at ports of entry or exit, the impact of natural disasters, global conflicts, health pandemics or other issues, in sufficient quantities and on commercially reasonable terms;

• difficulty identifying and qualifying alternative suppliers for components in a timely manner;

• difficulty identifying, qualifying and contracting with alternative suppliers for components in a timely manner;

• implementing and maintaining acceptable quality systems while experiencing rapid growth;

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In addition, our suppliers may encounter problems that limit their ability to manufacture components or products for us, including financial difficulties, damage to their manufacturing equipment or facilities, inability to obtain raw materials or other components, or problems with their own suppliers.

If we fail to obtain sufficient quantities of high-quality components to meet demand on a timely basis, we could lose customer orders, our reputation may be harmed, and our business could suffer.

For example, one of our key infusion set suppliers has recently experienced supply constraints, which has impacted our overall inventory levels and supply sales.

If we are unable to obtain sufficient quantities of these supplies or other necessary components to meet demand on a timely basis going forward, we could lose additional customer orders, our reputation may be harmed, and our business could suffer.

We generally use a small number of suppliers for our components and products, some of which are located internationally, including in China, Mexico and Costa Rica.

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Further, these transactions and arrangements are contractual in nature and may be terminated or dissolved under the terms of the applicable agreements and, in such event, we may not continue to have rights to the products relating to such transaction or arrangement or may need to purchase such rights at a premium.

For example, we have entered into multiple development and commercialization agreements with Dexcom, which have provided us non-exclusive licenses to integrate various generations of Dexcom’s CGM technology with our insulin pump products.

For example, we have entered into multiple development and commercialization agreements with Dexcom, which have provided us non-exclusive licenses compatible with various generations of Dexcom’s CGM technology with our insulin pump products.

Under certain circumstances, these agreements may be terminated by either party without cause or on short notice.

Our current agreements with Dexcom do not grant us rights to integrate future generations of Dexcom CGM technology, beyond G7 CGM devices, with any of our current or future products.

Termination of any of our agreements with Dexcom would require us to redesign certain current products and products under development, and would require us to integrate an alternative CGM system into our insulin pump systems in certain geographies, which would require significant development and regulatory activities that could result in an interruption or substantial delay in the availability of the product to our customers.

Our current agreements with Dexcom do not grant us rights to make our products compatible with future generations of Dexcom CGM technology, beyond G7 CGM devices, with any of our current or future products.

Termination of any of our agreements with Dexcom would require us to redesign certain current products and products under development, and would require us to make our products compatible with an alternative CGM system into our insulin pump systems in certain geographies, which would require significant development and regulatory activities that could result in an interruption or substantial delay in the availability of the product to our customers.

The termination of our existing commercial agreements with Dexcom would disrupt our ability to commercialize our existing products and our development of future products, which could have a material adverse impact on our financial condition and results of operations and negatively impact our ability to compete.

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• our ability to commercialize and sell our current and future products and our ability to increase sales and gross profit from our products, including insulin pumps and the related insulin cartridges and infusion sets;

• the success of new sales models and strategies, including our pay-as-you-go pharmacy channel reimbursement model and our transition to direct sales in select European countries;

• the success of new sales models and strategies, including our pay-as-you-go pharmacy channel reimbursement model and our transition to direct sales in select countries outside the United States;

• the number and mix of our products sold in each quarter;

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• the amount of, and the timing of the payment for, insurance deductibles required to be paid by our customers and potential customers under their existing insurance plans;

• interruption in the manufacturing or distribution of our products, including as a result of our initiation of direct sales in select European countries beginning in 2026;

• interruption in the manufacturing or distribution of our products, including as a result of our initiation of direct sales in select countries outside the United States beginning in 2026;

• our ability to simultaneously manufacture multiple products that meet quality, reliability and regulatory requirements;

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We may need or otherwise determine to raise additional funds in the future and if we are unable to raise additional funds when necessary or desirable, we may not be able to achieve our strategic objectives.*

As of March 31, 2026, we had $570.3 million in cash, cash equivalents and short-term investments.

Our management expects the continued growth of our business, including the expansion of our customer service infrastructure to support our growing base of customers, our plans to continue expanding commercial sales of our products internationally, the growth of our manufacturing and warehousing operations, and the increase of our facility footprint to accommodate additional headcount and R&D activities, will continue to increase our expenses.

As of June 30, 2026, we had $456.0 million in cash, cash equivalents and short-term investments.

Our management expects the continued growth of our business, including the expansion of our customer service infrastructure to support our growing base of customers, expansion of commercial sales of our products internationally, the growth of our manufacturing and warehousing operations, and the increase of our facility footprint to accommodate additional headcount and R&D activities, will continue to increase our expenses.

In addition, the amount of our future product sales is difficult to predict and actual sales may not be in line with our forecasts.

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We are also dependent upon our third-party suppliers for many of our product components and for our manufacturing-related equipment, and the incidence of disease could have a material adverse impact on the operations of our suppliers, which could prevent them from timely delivering products to us or supporting our requirements for manufacturing-related equipment.

The full extent of the impact of potential future public health threats on our business and operations is subject to change and will continue to depend on a number of factors, including the scope and duration of the pandemic and any resulting changes to general economic conditions in the countries in which we operate and sell our products.

The full extent of the impact of potential future public health threats on our business and operations is subject to change and will continue to depend on a number of factors, including the scope and duration of the public health threats and any resulting changes to general economic conditions in the countries in which we operate and sell our products.

Because our business is global, our sales and profits may fluctuate or decline in response to changes in foreign currency exchange rates or other international risks.

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In 2025, we began actively hedging our exposure to currency rate fluctuations;

however, future foreign currency fluctuations are difficult to predict and there is no guaranty that our foreign currency hedging transactions will have the desired effect.

however, future foreign currency fluctuations are difficult to predict and there is no guarantee that our foreign currency hedging transactions will have the desired effect.

As a result of these hedging transactions and future foreign currency fluctuations, the volatility of our sales, profitability, and stock price could increase and be favorably or unfavorably impacted.

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Our data processing activities may subject us to numerous data privacy and security obligations, such as various laws, regulations, guidance, industry standards, external and internal data privacy and security policies, and contractual requirements.

A number of U.S.

laws govern the privacy and security of personal data, including data breach notification laws, data privacy laws, consumer protection laws (e.g., Section 5 of the Federal Trade Commission Act), and other laws at the federal and state levels (e.g., wiretapping laws).

A number of United States laws govern the privacy and security of personal data, including data breach notification laws, data privacy laws, consumer protection laws (e.g., Section 5 of the Federal Trade Commission Act), and other laws at the federal and state levels (e.g., wiretapping laws).

For example, the United States Health Insurance Portability and Accountability Act of 1996 (HIPAA), as amended by the Health Information Technology for Economic and Clinical Health Act of 2009 (HITECH), imposes specific requirements relating to the privacy, security, and transmission of individually identifiable protected health information.

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state privacy laws exempt some data processed in the context of clinical trials, but these developments may further complicate compliance efforts, and increase legal risk and compliance costs for us and the third parties with whom we work.

Internationally, an increasing number of laws, regulations, and industry standards govern data privacy and security.

Internationally, an increasing number of laws, regulations, and industry standards govern data privacy and security, including breach notification laws.

For example, GDPR and Canada’s Personal Information Protection and Electronic Documents Act (PIPEDA) or the applicable provincial alternatives, impose strict requirements for processing personal data.

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In the event of unauthorized use or disclosure or other breaches of those agreements, we may not be provided with meaningful protection for our trade secrets or other proprietary information.

In addition, AI tools may be used within the Company for product development, software engineering, data analysis, and related processes.

The use of AI tools may create risks involving ownership, protection, and enforcement of intellectual property;

inadvertent disclosure of trade secrets or proprietary information;

infringement or misappropriation claims;

uncertainty over rights in AI-assisted outputs;

and reliance on third-party AI tools and vendors.

These risks could require redesign, delay development or regulatory activities, increase costs, impair competitive advantages, or expose the Company to litigation or liability.

To protect our proprietary rights, we may in the future need to assert claims of infringement against third parties, which may be difficult, expensive and time consuming.

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Hoffman-La Roche AG and Roche Diabetes Care GmbH until our entry into a settlement agreement in May 2025.

See Note 4, “Composition of Certain Financial Statement Items.”

See Note 2, “Summary of Significant Accounting Policies” to the unaudited condensed consolidated financial statements included in this Quarterly Report.

We do not maintain insurance to cover the expense or any liability that may arise from an intellectual property dispute.

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• recalls and field safety corrective actions.

Before we can market or sell a new regulated product or a significant modification to an existing product in the United States, we must obtain either clearance under Section 510(k) of the Food, Drug and Cosmetic Act (510(k) or approval of a pre-market approval (PMA) application from the FDA, unless an exemption from pre-market review applies.

Before we can market or sell a new regulated product or a significant modification to an existing product in the United States, we must obtain either clearance under Section 510(k) of the Food, Drug and Cosmetic Act (510(k) or approval of a PMA application from the FDA, unless an exemption from pre-market review applies.

The process of obtaining regulatory clearances, certification, or approvals to market a medical device can be costly and time-consuming, which may be exacerbated if the FDA or other comparable regulatory authorities or Notified Bodies in the EU changes their clearance, certification, and approval policies, and we may not be able to obtain these clearances, certification for our proposed products or approvals on a timely basis or at all, including as a result of:

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The IRA 2022 also eliminates the “donut hole” under the Medicare Part D program beginning in 2025 by significantly lowering the beneficiary maximum out-of-pocket cost and through a newly established manufacturer discount program.

In addition, on July 4, 2025, the annual reconciliation bill, the OBBBA, was signed into law which is expected to reduce Medicaid spending and enrollment by implementing work requirements for some beneficiaries, capping state-directed payments, reducing federal funding, and limiting provider taxes used to fund the program.

In addition, on July 4, 2025, the annual reconciliation bill, the One Big Beautiful Bill Act (OBBBA), was signed into law which is expected to reduce Medicaid spending and enrollment by implementing work requirements for some beneficiaries, capping state-directed payments, reducing federal funding, and limiting provider taxes used to fund the program.

OBBBA also narrows access to the Affordable Care Act marketplace exchange enrollment and declined to extend the Affordable Care Act enhanced advanced premium tax credits, which expired at the end of 2025, which, among other provisions in the law, are anticipated to reduce the number of Americans with health insurance.

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In addition, on December 2, 2025, CMS finalized its proposed competitive bidding process for some medical equipment, including continuous glucose monitors and insulin pumps that could affect reimbursement rates for our products.

In addition, CMS finalized a change in payment for these devices to a monthly rental basis which could impact when our pumps are shipped and corresponding sales are recognized.

CMS also finalized a change in payment for these devices to a monthly rental basis which could impact when our pumps are shipped and corresponding sales are recognized.

We cannot predict which, if any, additional healthcare reform proposals will be adopted, when they may be adopted or what impact they may have on the existing regulatory environment, or our ability to operate our business.

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We may be unable to fulfil these obligations, or our Notified Body may consider that we have not adequately demonstrated compliance with our related obligations to merit a CE Certificate of Conformity on the basis of the MDR.

Recent changes to the European Union regulatory framework for diagnostic medical devices may materially impact our operations, product availability, compliance costs, and market access in the EU.

Recent changes to the European Union regulatory framework for medical devices may materially impact our operations, product availability, compliance costs, and market access in the EU.

In July 2024, Regulation (EU) 2024/1860 (the Regulation) entered into application.

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In addition, the Regulation introduces the gradual rollout of EUDAMED, the EU’s central database for medical devices and diagnostics.

Starting from May 28, 2026, the use of the first four modules will become mandatory:

As of May 28, 2026, the use of the first four modules is mandatory:

actor registration, UDI/Devices registration, notified bodies and certificates, and Market Surveillance.

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These ESG requirements and initiatives are subject to change, can be unpredictable, and may be challenging and costly for us to meet due to the complexity of our supply chain and the outsourced manufacturing of certain components.

If we fail to comply or are unable to ensure our suppliers' compliance with these policies, customers may stop purchasing from us or pursue legal action, potentially damaging our reputation, sales, and financial performance.

If we fail to comply or are unable to ensure our suppliers’ compliance with these policies, we may face enforcement actions or litigation or customers may stop purchasing from us, potentially damaging our reputation, sales, and financial performance.

Our business could be adversely affected by changing expectations and challenges associated with implementing ESG initiatives, establishing ESG-related goals, gathering ESG data, and disclosing ESG-related information.

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The tax regimes to which we are subject or under which we operate are unsettled and may be subject to significant change.

The issuance of additional guidance related to existing or future tax laws, or changes to tax laws or regulations proposed or implemented by the current or a future United States presidential administration, Congress, or taxing authorities in other jurisdictions, including jurisdictions internationally, or by bodies such as the European Commission or the Organization for Economic Co-operation and Development (OECD), could materially affect our tax obligations (including the costs of compliance) and effective tax rate.

Department of Treasury, taxing authorities in other jurisdictions, including jurisdictions internationally, or by bodies such as the European Commission or the Organization for Economic Co-operation and Development (OECD), could materially affect our tax obligations (including the costs of compliance) and effective tax rate.

To the extent that such changes have a negative impact on us, including as a result of related uncertainty, these changes may adversely impact our business, financial condition, results of operations, and cash flows.

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The taxing authorities of the jurisdictions in which we operate may challenge our methodologies for pricing intercompany transactions pursuant to our intercompany arrangements or disagree with our determinations as to the income and expenses attributable to specific jurisdictions.

If such a challenge or disagreement were to occur, and our position was not sustained, we could be required to pay additional taxes, interest, and penalties, which could result in one-time tax charges, higher effective tax rates, reduced cash flows, and lower overall profitability of our operations.

If such a challenge or disagreement were to occur, and our position was not sustained, we could be required to pay additional taxes, interest and penalties, and update our tax policies and methodologies on a prospective basis, which could result in one-time tax charges, higher effective tax rates, reduced cash flows, and lower overall profitability of our operations.

Our financial statements could fail to reflect adequate reserves to cover such a contingency.

Similarly, a taxing authority could assert that we are subject to tax in a jurisdiction where we believe we have not established a taxable connection, often referred to as a “permanent establishment” under international tax treaties, and such an assertion, if successful, could increase our expected tax liability in one or more jurisdictions.

government recently enacted the OBBBA that (along with other recent U.S.

federal tax reform) has resulted in significant changes to the taxation of business entities including, among other changes, changes to the taxation of income derived from international operations, changes in the deduction and amortization of research and development expenditures, and limitations on the deductibility of business interest.

The United States government recently enacted the OBBBA that (along with other recent United States federal tax reform) has resulted in significant changes to the taxation of business entities including, among other changes, changes to the taxation of income derived from international operations, changes in the deduction and amortization of research and development expenditures, and limitations on the deductibility of business interest.

Future guidance from the Internal Revenue Service and other tax authorities with respect to any legislation may affect us, and certain aspects of such legislation could be repealed or modified or sunset in future years.

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These proposals involve, among other measures, the imposition of a minimum effective corporate tax rate on certain multinational enterprises.

A number of countries in which we conduct business, including through our subsidiaries, such as the Netherlands and Switzerland, have enacted, or are in the process of enacting, core elements of the Pillar Two rules (with further provisions expected to be enacted in the future).

Based on the minimum sales thresholds contained in the Pillar Two rules, we currently expect to fall within their scope.

A number of countries in which we conduct business, including through our subsidiaries, have enacted, or are in the process of enacting, core elements of the Pillar Two rules (with further provisions expected to be enacted in the future).

Based on the minimum revenue thresholds contained in the Pillar Two rules, we became subject to such rules beginning in the 2025 tax year.

The OECD has issued (and is expected to continue to issue further) administrative guidance providing transition and safe harbor rules in relation to the implementation of the Pillar Two proposals.

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Unregistered Sales of Equity Securities and Use of Proceeds.

Defaults Upon Senior Securities.

Mine Safety Disclosures.

Not applicable.

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 1A. Risk Factors