DexCom Eyes Explosive Growth with Game-Changing Type 2 Strategy—Is This Its Biggest Pivot Yet?

DexCom’s latest earnings and strategy pivot have reignited investor attention as the company recalibrates its focus on the vast, underpenetrated Type 2 diabetes market. After suffering a 41% stock drop in July 2024 due to poor execution in its transition away from its traditional Type 1 diabetes stronghold, the company now appears to be correcting course—not by retreating, but by accelerating into the same direction with more refined tactics. The first quarter of 2025 showed encouraging signs, including record-breaking new patient additions, expanded insurance coverage from all three major PBMs for non-insulin-dependent patients, and the introduction of Stelo, DexCom’s first over-the-counter CGM. A 15-day G7 sensor was also approved by the FDA, aimed at improving margins and competitiveness. Despite ongoing gross margin pressures and an FDA warning letter, DexCom remains operationally steady, reaffirming its full-year revenue guidance and initiating a $750 million share buyback. The market is now watching to see if this recalibrated bet on Type 2 diabetes can deliver sustained growth.