November 10, 2008

DexCom Inc. Reports Third Quarter 2008 Financial Results

SAN DIEGO, Nov 10, 2008 (BUSINESS WIRE) -- DexCom, Inc. (Nasdaq:DXCM) today reported its unaudited financial results for the quarter ended September 30, 2008.

Product revenue grew to $1.9 million for the third quarter of 2008, an increase of 53% from the $1.2 million in product revenue reported for the third quarter of 2007. Total third quarter 2008 revenue, which included development grant revenue, was $1.9 million, an increase of 57% from the same quarter in 2007. The company reported a net loss of $14.7 million or $0.50 per share for the third quarter of 2008, up from $11.4 million or $0.40 per share for the third quarter of 2007. The net loss for the third quarter of 2008 included $2.7 million in non-cash expenses, centered primarily in share-based compensation.

Cost of sales totaled $3.8 million for the third quarter of 2008, compared to $3.1 million for the third quarter of 2007. The increase was due to additional product sales and development expenses relating to a development agreement entered into during the first quarter of 2008. Research and development expense increased by approximately $1.7 million to $5.4million for the third quarter of 2008, compared to $3.7million for the third quarter of 2007. Changes in research and development expense included higher consulting, facility, and supply costs. Selling, general and administrative expense increased by approximately $0.7 million to $6.7million for the third quarter of 2008, compared to $5.9million for the third quarter of 2007, with the change primarily due to additional general and administrative costs, including increased share-based compensation. As of September 30, 2008, the Company had $30.2 million in cash, marketable securities, and restricted cash.

Conference Call

Management will hold a conference call today starting at 4:30 pm (Eastern Time). The conference call will be concurrently webcast. The link to the webcast will be available on the DexCom, Inc. website at www.dexcom.com under the investor webcast section and will be archived for future reference. To listen to the conference call, please dial (888) 487-0359 (US/Canada) or (719) 325-2462 (International) and use the participant code "8557648" approximately five minutes prior to the start time.

About DexCom, Inc.

DexCom, Inc., headquartered in San Diego, California, is developing and marketing continuous glucose monitoring systems for people with diabetes.

Cautionary Statement Regarding Forward Looking Statements

DexCom is a medical device company with a limited operating history. Successful commercialization and sale of the company's products is subject to numerous risks and uncertainties, including product performance, a lack of acceptance in the marketplace by physicians and patients, the company's inability to manufacture products in commercial quantities at an acceptable cost and quality level, possible delays in the company's development programs, the inability of patients to receive reimbursement from third-party payors and inadequate financial and other resources. Certain of these risks and uncertainties, in addition to other risks, are more fully described in the company's quarterly report on Form 10-Q for the period ending September 30, 2008, as filed with the Securities and Exchange Commission on November 10, 2008.

DexCom, Inc.
Consolidated Balance Sheets
(In thousands--except par value data)
(Unaudited)
                                                                      September 30,               December 31,
                                                                      2008                        2007
Assets
Current assets:
Cash and cash equivalents                                             $     4,642                 $     23,115
Short-term marketable securities, available-for-sale                        20,741                      41,208
Accounts receivable, net                                                    429                         215
Inventory                                                                   2,590                       1,139
Prepaid and other current assets                                            1,382                       1,614
Total current assets                                                        29,784                      67,291
Property and equipment, net                                                 6,442                       6,649
Restricted cash                                                             4,839                       914
Other assets                                                                2,010                       2,405
Total assets                                                          $     43,075                $     77,259
Liabilities and stockholders' equity
Current liabilities:
Accounts payable and accrued liabilities                              $     2,663                 $     4,535
Accrued payroll and related expenses                                        2,722                       2,537
Current portion of long-term debt                                           2,275                       1,375
Current portion of deferred revenue                                         167                         --
Total current liabilities                                                   7,827                       8,447
Long-term portion of deferred revenue                                       212                         --
Other liabilities                                                           679                         666
Long-term debt, net of current portion                                      61,650                      61,031
Total liabilities                                                           70,368                      70,144
Commitments and contingencies
Stockholders' (deficit) equity:
Preferred stock, $0.001 par value, 5,000 shares authorized; no              --                          --
shares issued and outstanding at September 30, 2008 and December 31,
2007, respectively
Common stock, $0.001 par value, 100,000 authorized; 30,067 and              30                          29
29,788 issued and outstanding at September 30, 2008; 28,778 and
28,624 shares issued and outstanding at December 31, 2007
Additional paid-in capital                                                  190,744                     183,325
Accumulated other comprehensive income (loss)                               (81       )                 13
Accumulated deficit                                                         (217,986  )                 (176,252  )
Total stockholders' (deficit) equity                                        (27,293   )                 7,115
Total liabilities and stockholders'                                   $     43,075                $     77,259
(deficit) equity
DexCom Inc.
Consolidated Statements of Operations
(In thousands--except per share data)
(Unaudited)
                                                             Three Months Ended                          Nine Months Ended
                                                             September 30,                               September 30,
                                                                  2008                2007                   2008              2007
Product revenue                                              $    1,878          $    1,224              $   5,643         $   3,099
Development grant revenue                                         42                  --                     122               --
Total revenue                                                     1,920               1,224                  5,765             3,099
Product cost of sales                                             3,577               3,113                  9,833             9,081
Development cost of sales                                         263                 --                     643               --
Total cost of sales                                               3,840               3,113                  10,476            9,081
Gross margin (deficit)                                            (1,920    )         (1,889    )            (4,711    )       (5,982    )
Operating expenses
Research and development                                          5,418               3,671                  15,058            11,734
Selling, general and administrative                               6,652               5,943                  20,320            16,783
Total operating expenses                                          12,070              9,614                  35,378            28,517
Operating loss                                                    (13,990   )         (11,503   )            (40,089   )       (34,499   )
Interest income                                                   215                 1,014                  1,087             2,932
Interest expense                                                  (913      )         (895      )            (2,732    )       (2,082    )
Net loss                                                          ($14,688  )         ($11,384  )            ($41,734  )       ($33,649  )
Basic and diluted net loss per share                              ($0.50    )         ($0.40    )            ($1.42    )       ($1.19    )
Shares used to compute basic and diluted net loss per share       29,627              28,325                 29,415            28,283

SOURCE: DexCom, Inc.

DexCom, Inc. 
Jess Roper 
Vice President and Chief Financial Officer 
(858) 200-0200 
www.dexcom.com

Copyright Business Wire 2008

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