DexCom Inc. Reports Second Quarter 2009 Financial Results

Product revenue grew to approximately $4.1 million for the second quarter of 2009, an increase of 112% from the $1.9 million in product revenue reported for the second quarter of 2008, and an increase of approximately 54% from the $2.7 million reported for the first quarter of 2009. Total second quarter 2009 revenue, which includes development grant revenue, was $6.8 million, an increase of approximately 241% from the same quarter in 2008, and approximately 30% from the first quarter of 2009. The company reported a net loss of $15.3 million, up from $15.0 million for the second quarter of 2008. Net loss was $0.33 per share for the second quarter of 2009, down from a net loss of $0.51 per share for the second quarter of 2008. The net loss included $4.4 million in non-cash expenses during the second quarter of 2009, which included $1.2 million in non-cash interest expense associated with the adoption of FSP APB 14-1.

Cost of sales totaled $7.8 million for the second quarter of 2009, compared to $3.4 million for the second quarter of 2008. The increase was due to additional product sales and development costs related to development and collaboration agreements entered into during 2008. Research and development expense decreased by approximately $1.3 million to $3.5 million for the second quarter of 2009, compared to $4.8 million for the second quarter of 2008. The decrease in research and development expense was primarily due to development and collaboration agreements entered into during 2008 and the corresponding allocation of expenses to development cost of sales for these activities. Selling, general and administrative expense increased by approximately $1.7 million to $9.0 million for the second quarter of 2009, compared to $7.2 million for the second quarter of 2008, with the change primarily due to additional marketing, customer service, and insurance reimbursement costs. As of June 30, 2009, the Company had $52.1 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) 895-5271 (US/Canada) or (847) 619-6547 (International) and use the participant code "25076281" 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 ambulatory use by patients and by healthcare providers in the hospital.

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 reimbursements 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 June 30, 2009, as filed with the Securities and Exchange Commission on August 3, 2009.

DexCom, Inc.
Balance Sheets
(In thousands - except par value data)
(Unaudited)
                                                                   June 30,            December 31,
                                                                   2009                2008 (1)
Assets
Current assets:
Cash and cash equivalents                                          $       4,208       $       12,700
Short-term marketable securities, available-for-sale                       44,666              14,368
Accounts receivable, net                                                   2,067               1,118
Inventory                                                                  1,363               2,446
Prepaid and other current assets                                           1,819               1,426
Total current assets                                                       54,123              32,058
Property and equipment, net                                                6,495               6,105
Restricted cash                                                            3,208               4,270
Other assets                                                               1,275               1,449
Total assets                                                       $       65,101      $       43,882
Liabilities and stockholders' equity
Current liabilities:
Accounts payable and accrued liabilities                           $       4,118       $       4,599
Accrued payroll and related expenses                                       3,158               2,115
Current portion of long-term debt                                          1,244               1,931
Current portion of deferred revenue                                        8,104               6,351
Total current liabilities                                                  16,624              14,996
Long-term portion of deferred revenue                                      1,953               5,669
Other liabilities                                                          880                 889
Long-term debt, net of current portion                                     43,667              41,796
Total liabilities                                                          63,124              63,350
Commitments and contingencies
Stockholders' equity (deficit):
Preferred stock, $0.001 par value, 5,000 shares authorized; no             --                  --
shares issued and outstanding at June 30, 2009 and December 31,
2008, respectively
Common stock, $0.001 par value, 100,000 authorized; 46,187 and             46                  30
45,907 issued and outstanding at June 30, 2009; 30,103 and 29,824
shares issued and outstanding at December 31, 2008
Additional paid-in capital                                                 268,024             218,136
Accumulated other comprehensive income                                     63                  50
Accumulated deficit                                                        (266,156 )          (237,684 )
Total stockholders' equity (deficit)                                       1,977               (19,468  )
Total liabilities and stockholders' equity (deficit)               $       65,101      $       43,882
(1) The Consolidated Balance Sheet at December 31, 2008 has been
derived from the audited consolidated financial statements as
adjusted for the adoption of FSP APB 14-1.

DexCom, Inc.
Statements of Operations
(In thousands - except per share data)
(Unaudited)
                                                             Three Months Ended                 Six Months Ended
                                                             June 30,                           June 30,
                                                                 2009             2008 (1)          2009             2008 (1)
Product revenue                                              $   4,112        $   1,940         $   6,784        $   3,764
Development grant revenue                                        2,639            42                5,179            80
Total revenue                                                    6,751            1,982             11,963           3,844
Product cost of sales                                            4,627            3,144             8,149            6,256
Development cost of sales                                        3,172            249               5,125            379
Total cost of sales                                              7,799            3,393             13,274           6,635
Gross deficit                                                    (1,048  )        (1,411   )        (1,311  )        (2,791   )
Operating expenses
Research and development                                         3,455            4,797             6,626            9,640
Selling, general and administrative                              8,952            7,247             16,855           13,668
Total operating expenses                                         12,407           12,044            23,481           23,308
Operating loss                                                   (13,455 )        (13,455  )        (24,792 )        (26,099  )
Interest income                                                  107              307               230              872
Interest expense                                                 (1,982  )        (1,818   )        (3,910  )        (3,553   )
Net loss                                                     $   (15,330 )    $   (14,966  )    $   (28,472 )    $   (28,780  )
Basic and diluted net loss per share                         $   (0.33   )    $   (0.51    )    $   (0.67   )    $   (0.98    )
Shares used to compute basic and diluted net loss per share      45,832           29,387            42,718           29,308
(1) Adjusted for the required retrospective application of FSP APB
14-1.

SOURCE: DexCom, Inc.

DexCom, Inc. 
Steven R. Pacelli 
Chief Administrative Officer 
858-200-0200 
www.dexcom.com