DexCom, Inc. stock research
FY2025 Q4
DexCom (DXCM) Gross Margin — Quarter Ended Dec 31, 2025
Revenue increased while cost of revenue declined sequentially, leading to an expansion in gross profit and gross margin. Compared to the prior quarter, gross margin improved; it also improved relative to the same quarter last year.
Gross margin takeaway
Quarter ended Dec 31, 2025 · FY2025 Q4
Revenue increased while cost of revenue declined sequentially, leading to an expansion in gross profit and gross margin. Compared to the prior quarter, gross margin improved; it also improved relative to the same quarter last year.
- The most observable margin driver was the combination of higher revenue and lower cost of revenue, which together boosted gross profit. The reduction in cost of revenue despite higher revenue contributed to margin expansion.
- Sequentially, gross margin strengthened as revenue grew and cost of revenue fell. Year over year, gross margin also improved, supported by revenue growth that outpaced the increase in cost of revenue.
Gross margin snapshot
The selected quarter's reported revenue, gross profit, direct costs, and margin comparisons.
Gross margin
62.9%
Gross profit
$792.7M
Revenue
$1.3B
Cost of revenue
$466.9M
Quarter-over-quarter change
+2.5 pts
Year-over-year change
+4.0 pts
Quarterly gross margin trend
A four-quarter view of the revenue and direct-cost bridge behind gross margin.
| Period | Revenue | Gross profit | Cost of revenue | Gross margin |
|---|---|---|---|---|
| Mar 31, 2025 | $1.0B | $589.0M | $447.0M | 56.9% |
| Jun 30, 2025 | $1.2B | $688.8M | $468.3M | 59.5% |
| Sep 30, 2025 | $1.2B | $731.4M | $477.9M | 60.5% |
| Dec 31, 2025 | $1.3B | $792.7M | $466.9M | 62.9% |
Quarterly comparisons
Compare the selected margin with the preceding quarter and the same fiscal quarter one year earlier.
Previous-quarter change
Sep 30, 2025
+2.5 pts
Year-over-year change
Dec 31, 2024
+4.0 pts
What the margin says
Filing-constrained interpretation of margin direction, comparisons, and what to monitor next.
The most observable margin driver was the combination of higher revenue and lower cost of revenue, which together boosted gross profit. The reduction in cost of revenue despite higher revenue contributed to margin expansion.
Sequentially, gross margin strengthened as revenue grew and cost of revenue fell. Year over year, gross margin also improved, supported by revenue growth that outpaced the increase in cost of revenue.
Monitor the trajectory of cost of revenue, as it declined sequentially but increased year over year, and its behavior will influence future margin trends. The company's management discussion notes that operating cash flows are a primary liquidity source, which are linked to gross margin performance.