MiniMed Group Inc.
09/08/2026 | Press release | Distributed by Public on 09/08/2026 14:28
Quarterly Report for Quarter Ending July 31, 2026 (Form 10-Q)
Management's Discussion and Analysis of Financial Condition and Results of Operations
The following discussion and analysis provides information management believes to be relevant to understanding the financial condition and results of operations of MiniMed Group, Inc. (MiniMed, or the Company, or we, us, or our). For a full understanding of financial condition and results of operations, you should read this discussion along with Management's Discussion and Analysis of Financial Condition and Results of Operations in our Annual Report on Form 10-K for the fiscal year ended April 24, 2026, filed with the U.S. Securities and Exchange Commission (the "SEC"). In addition, you should read this discussion along with our condensed consolidated financial statements and related notes thereto included elsewhere in this Quarterly Report on Form 10-Q. Amounts reported in millions within this report may not total exactly, due to rounding. Additionally, certain columns and rows within tables may not sum due to rounding. Our actual results could differ materially from the results contemplated in any forward-looking statements due to a number of factors, including those described under "Risk Factors" in our Annual Report on Form 10-K as well as under "Cautionary Note Regarding Forward-Looking Statements" included herein.
Overview
We are a global medical technology company that develops, manufactures, and markets a comprehensive suite of solutions for the management of diabetes, including automated insulin delivery ("AID") systems and smart multiple daily injection ("Smart MDI") systems. Our AID systems integrate insulin delivery, glucose sensing, and proprietary dosing algorithms to improve glycemic outcomes and reduce the burden of diabetes management for people with diabetes ("PWD"). Our AID systems are composed of an insulin pump that administers insulin, consumable insulin infusion sets and reservoirs, a continuous glucose monitoring ("CGM") sensor, such as Simplera Sync or Instinct (made by Abbott), that measures glucose levels, and a Smart Dosing algorithm. Our newest AID platform, MiniMed Flex, expands patient choice, providing a smaller form factor and smartphone control, powered by our SmartGuard technology. We also continue to offer the MiniMed 780G AID system. For PWDs that prefer to self-administer insulin through manual injections or seek freedom from on-body devices, our Smart MDI systems offer an integrated solution for sensing, dosing, and administration. Our MiniMed Go Smart MDI system includes a Smart Insulin Pen for insulin administration (which connects to our Smart Dosing software), a CGM sensor that measures blood glucose levels, and wraparound applications and services.
Historically, MiniMed operated as Medtronic plc's ("Medtronic") global diabetes business. As a result, periods presented prior to our separation from Medtronic (the "Separation") reflect the historical results of the diabetes business as managed within Medtronic and were prepared on a carve-out basis. Those historical periods include allocations of certain corporate and shared services expenses from Medtronic, which management believes are reasonable. However, such historical results may not be indicative of the results that would have been achieved had we operated as a standalone company during those periods.
On March 6, 2026, we completed our initial public offering ("IPO"), and on March 9, 2026, we began operating as a standalone public company. We continue to maintain transitional and ongoing relationships with Medtronic pursuant to various separation-related agreements, including transition services, manufacturing arrangements, and other commercial arrangements. As a standalone public company, we incur costs related to corporate governance, internal controls, information systems, and public company compliance that were not historically reflected in the carve-out financial statements. Accordingly, comparisons between current period results and historical periods presented may be affected by these changes.
Separation from Medtronic and Initial Public Offering
Our IPO was a result of Medtronic's previously announced plan to separate its diabetes business. In connection with the separation, MiniMed was incorporated to hold the diabetes business and became an independent publicly traded company upon completion of the IPO.
As of July 31, 2026, Medtronic continued to own approximately 90% of our outstanding common stock. We have entered into a series of agreements with Medtronic governing the allocation of assets and liabilities and providing for certain transitional and ongoing services, including manufacturing, information technology, and other support services.
Under these arrangements, certain services continue to be provided between MiniMed and Medtronic for specified periods pursuant to agreed-upon terms. The costs associated with these arrangements are expected to change over time as we continue the transition to standalone operations. The terms of these agreements may differ from those that could have been obtained in arm's-length transactions with unaffiliated third parties. For additional information regarding these arrangements, see Note 14. "Related Party Transactions."
Periods presented prior to the IPO reflect the historical results of the diabetes business and do not include all of the costs of operating as a standalone public company. Accordingly, historical results may not be indicative of our future results of operations, financial position, or cash flows.
Recent Developments
During the periods presented, we continued to advance our core diabetes technology platforms, including our insulin delivery systems, Smart MDI offerings, and CGM portfolio. We also continued to invest in research and development activities and to expand regulatory approvals for certain products and indications across geographies.
In February 2026, we launched the MiniMed Go, our Smart MDI system in Europe and beginning in May 2026, we continued the global rollout of the MiniMed Go with commercial launch in the U.S.
In June 2026, we announced an extension to our partnership with Abbott Laboratories to collaborate with them on an exclusive integration between the Abbott-manufactured dual glucose-ketone sensors and our smart dosing systems, which is expected in calendar year 2027.
In August 2026, we initiated the U.S. launch of MiniMed Flex integrated with the Instinct continuous glucose monitoring sensor. We believe this expanded compatibility enhances the flexibility of our automated insulin delivery ecosystem and supports broader patient adoption of our diabetes technology offerings. The launch represents an important milestone in the continued expansion of the MiniMed Flex platform and our efforts to provide patients with additional sensor-integrated insulin delivery options.
In September 2026, we announced that MiniMed Flex received CE Mark approval, achieving a key regulatory milestone earlier than our previously anticipated timing. We expect this approval to support the commercial launch of MiniMed Flex in applicable European markets starting in November 2026. We believe the continued global expansion of the MiniMed Flex platform will further strengthen our product portfolio and support long-term growth opportunities within our diabetes business.
In September 2026, we announced the submission of our MiniMed Fit patch pump to the U.S. Food and Drug Administration ("FDA"), with an expected full U.S. product launch in Summer 2027.
Trends and Uncertainties Impacting Financial Results
We believe our future performance will be influenced by a number of factors, including those described in the section, "Risk Factors" of our most recent Annual Report on Form 10-K, and elsewhere in this Quarterly Report as well as the factors described below. While each of these factors presents significant opportunities for us, these factors also pose challenges that we must successfully address in order to sustain the growth of our business and enhance our results of operations.
CGM Pricing Pressure
We have observed pricing pressure on CGMs globally, particularly in certain international markets. Differences in reimbursement and pricing dynamics across geographies and sales channels can result in variability in average selling prices and gross margins, particularly as changes in sales mix occur. Additionally, as competition in the CGM market intensifies, lower-cost CGM options in the market may contribute to further pricing pressure over time. We are focused on continuing to invest in our pipeline to deliver differentiated solutions that reinforce our competitive positioning and our long-term growth.
Product Launches and Investment in Pipeline
We believe the success of our products correlates to the continued acceptance and growth of our product offerings, such as the MiniMed Flex, MiniMed 780G system, next-generation AID systems, and Smart MDI systems like MiniMed Go. Our ability to meet growing demand for our existing products and to successfully develop, obtain regulatory approval or clearance of, and commercialize the products within our pipeline is essential to our results of operations. Timing and successful launch of partnerships such as our agreement with Abbott may also contribute meaningfully to our future market performance. For example, we believe the early FDA clearance of MiniMed Flex shifted demand of customers who preferred to wait for the new system, which resulted in a reduction of pump sales following the announcement of the FDA clearance in the fourth quarter of fiscal 2026. Following the launch of MiniMed Flex insulin pump system with Simplera sensor in June, domestic pump sales returned to growth in the first quarter of fiscal 2027.
The ability to sustain ongoing investment in our pipeline will be required as we progress towards developing and launching our next generation of products. We strive to develop ways in which we can make our research and development process as efficient as possible and reduce the amount of investment needed to progress a product to approval.
Users, New Patient Adoption, and Sales of CGMs and Other Consumables
Our financial performance is influenced by our ability to retain existing users, attract new patients to our technology platforms, and increase adoption of consumable products, including CGM sensors, infusion sets, and reservoirs. Sales to new patients and continued utilization of our consumable products contribute to recurring revenue and are important drivers of growth. Adoption of new products and enhancements, including improvements to our CGM portfolio, may influence new patient acquisition, user retention, and consumable attachment rates.
Manufacturing and Supply
Our business model requires the ability to produce high volumes of our products and reliably ship to various geographies in a time-efficient manner. Disruptions to our supply lines or shipping channels may impact our customer experience and ability to meet market demand. We also continue to invest in expanding our manufacturing capacity as a key strategic priority of our business as we strive to meet significant demand for our CGM sensors and drive profitable growth.
Impact of Increased CGM Share of Product Mix on Profit Margin
Relative to sales of our insulin pumps, pens, and other consumables, sales of our CGMs, particularly our Simplera and Simplera Sync products, have historically contributed to a lower profit margin. As a result, we expect that an increased volume of sales with Simplera and Simplera Sync will likely have a negative impact on our profit margin, as we have observed in recent periods. However, as we continue to ramp our manufacturing capacity to meet demand, we are focused on optimizing manufacturing efficiencies, driving innovation, and expanding premium offerings to help offset expected margin impacts while sustaining growth.
Reimbursement
Our business is dependent on obtaining and maintaining adequate coverage and reimbursement for our products from government and private payors. Changes to reimbursement policies, coverage criteria, payment levels, or channel dynamics, including the classification of products within durable medical equipment ("DME") or pharmacy benefit channels, may affect product adoption, net sales, and operating results. We continue to monitor reimbursement developments across our key markets and work with payors and providers to support patient access to our products.
Seasonality
Our total revenues vary slightly from quarter to quarter. Based on historical experience, we generally have higher revenues toward calendar year end and our fiscal year end. The trend is primarily driven by annual insurance deductible resets and unfunded flexible spending account dynamics in the U.S. market, which is partially counteracted by lower pump sales as our competitors push for a strong end to their fiscal years, which align to calendar years. Sales of our single-use products such as infusion sets, reservoirs, and CGMs have generally mitigated quarterly seasonal fluctuations in pump sales.
Foreign Currency
A significant portion of the Company's revenues and expenses are denominated in currencies other than the U.S. dollar. As a result, changes in foreign currency exchange rates may impact reported revenue, gross margin, and operating results from period to period. The Company continues to evaluate its exposure to foreign currency risk as it transitions to standalone operations.
Components of Results of Operations
Sales
Our net sales are generated primarily from the sale of reusable and single-use products which collectively comprise our AID and Smart MDI systems.
Our insulin pumps and pens are considered reusable products as patients are able to continue their use of these products for a period of one year or more. Patients are generally eligible for reimbursement coverage of a new insulin pump every four to five years depending on both geography and payer type. Not all patients elect to replace their pump on this cycle and some use their pumps for longer than the replacement period because they can continue to operate as the patient continues to purchase consumables. Patients using durable insulin pens typically obtain replacements on an annual cycle due to reimbursement and product life span.
Our CGMs and the consumable components comprised of infusion sets and reservoirs associated with pumps are considered single-use products as these products are required to be replaced frequently for uninterrupted operation of our AID and Smart MDI systems. Patients using AID systems as well as Smart MDI systems typically replace their sensors either on a weekly basis as the Guardian 4 sensor and Simplera Sync sensors are indicated for up to 7 days of use, or on a bi-weekly basis as the Instinct sensor is indicated for up to 15 days of use. Patients using AID systems also replace their infusion sets and reservoirs either weekly or multiple times per week, depending on the type of infusion sets and reservoirs they use.
Cost of Products Sold
Cost of products sold includes raw materials, labor costs, manufacturing overhead expenses, shipping and handling costs incurred to store, move, and prepare products for shipment, amortization of purchased technology intangible assets, import tariffs and duties, reserves for expected warranty costs, scrap and excess, and obsolete inventory. Manufacturing overhead expenses include expenses relating to manufacturing engineering, material procurement, inventory and quality control, facilities, depreciation, information technology, and operations supervision and management.
Selling, General and Administrative
Selling, general, and administrative expense primarily consists of salaries and wages, benefits, other administrative costs, such as professional fees and marketing expenses, stock-based compensation, and restructuring associated expenses. Selling, general, and administrative expense also includes amortization expense related to our customer list and tradename intangible assets.
Research and Development
Research and development costs include costs of research, engineering, and technical activities to develop a new product or service or make significant improvement to an existing product or manufacturing process. Research and development costs also include pre-approval regulatory and clinical trial expenses.
Certain Litigation Charges
We classify specified certain litigation charges and gains related to significant legal matters as certain litigation charges, net in the consolidated statements of operations.
Other Operating Income and Expense, Net
Other operating expense (income), net primarily includes restructuring expense, currency remeasurement, and income from research and development funding arrangements.
Other Non-operating Income and Expense, Net
Other non-operating expense (income), net includes investment gains and losses.
Income Tax Provision
Income tax provision includes current and deferred income tax expense related to federal, state, and international jurisdictions.
Key Business Metrics
We regularly review the following key business metrics to evaluate our business, measure our performance, identify trends affecting our business, formulate financial projections, and make strategic decisions. In assessing the performance of our business, in addition to considering a variety of measures in accordance with U.S. GAAP, we also consider a variety of other key business metrics, including non-GAAP measures.
We believe that these key business metrics provide useful information to users of our financial statements in understanding and evaluating our results of operations in the same manner as our management team. The presentation of these key business metrics, including Organic Revenue Growth, Adjusted Gross Profit, and Adjusted EBITDA, which are non-GAAP financial measures, is not intended to be considered in isolation or as a substitute for, or superior to, the financial information prepared and presented in accordance with U.S. GAAP. See "Non-GAAP Measures" below.
The following table sets forth our key business metrics, including non-GAAP measures, for the periods indicated:
| Three Months Ended | |||||||||||
| (Dollars in millions) | July 31, 2026 | July 25, 2025 | |||||||||
| Net Sales | $ | 843 | $ | 723 | |||||||
| Gross Profit | $ | 465 | $ | 409 | |||||||
| Net Income (Loss) | $ | - | $ | (16) | |||||||
| New Pumps Sold (in thousands) | 34 | 32 | |||||||||
| Global CGM Attachment Rate | 69 | % | 64 | % | |||||||
| Net Sales Growth | 16.6 | % | 16.1 | % | |||||||
|
Organic Revenue Growth (1)
|
15.8 | % | 7.8 | % | |||||||
|
Adjusted Gross Profit (1)
|
$ | 471 | $ | 409 | |||||||
|
Adjusted EBITDA (1)
|
$ | 83 | $ | 50 | |||||||
(1) See "Non-GAAP measures" below for a discussion of Organic Revenue Growth, Adjusted Gross Profit, Adjusted EBITDA, and reconciliations with the most directly comparable U.S. GAAP measures.
Gross Profit
Gross profit is our net sales, less cost of products sold.
New Pumps Sold
A leading indicator of our pump user base growth is the number of new pumps sold. We define New Pumps Sold ("NPS") as the number of new pumps sold to patients in a given period, inclusive of pumps sold to new patients and renewals by existing patients. This metric illustrates the number of new pump starts and renewals during each period presented, highlighting our capability to identify, attract, and retain users.
Global CGM Attachment Rate
Because we commercialize all parts of the smart dosing insulin therapy ecosystem, we are uniquely positioned to capture greater revenue per user than our competitors that only offer certain components of such systems. A key growth driver is our ability to increase CGM revenue per pump user which is reflected by our CGM Attachment Rate. We define CGM Attachment Rate as the percentage of total pump user base that is also using an integrated MiniMed CGM.
Organic Revenue Growth
Organic Revenue Growth measures our revenue growth trends excluding the impacts of foreign currency rate fluctuations and adjustments to the Company's Italian payback accrual for certain prior years since 2015, which is further described in Note 12. "Commitments and Contingencies," to the condensed consolidated financial statements. We use Organic Revenue Growth to assess our performance on a consistent basis by removing the impacts of foreign currency rate fluctuations and adjustments to the Italian payback accrual that we believe do not directly reflect our underlying operations. See "Non-GAAP Measures" below for a reconciliation of Organic Revenue Growth to Net Sales Growth, its most directly comparable U.S. GAAP measure.
Adjusted Gross Profit
Adjusted Gross Profit is a non-GAAP measure that we use to assess our overall performance. We define Adjusted Gross Profit as U.S. GAAP gross profit, excluding amortization of intangible assets and certain other non-operational items. We believe Adjusted Gross Profit provides consistency and comparability with our past financial performance and facilitates period-to-period comparisons of operations, as these metrics eliminate the effects of the adjustments that are unrelated to overall operating performance. See "Non-GAAP Measures" below for a reconciliation of Adjusted Gross Profit to gross profit, its most directly comparable U.S. GAAP measure.
Adjusted EBITDA
Adjusted EBITDA is a non-GAAP measure, calculated as net loss adjusted to exclude interest expense, provision for income taxes, and depreciation and amortization, further adjusted to exclude the impact of certain other non-operational items. We use Adjusted EBITDA to supplement U.S. GAAP measures of performance in the evaluation of the effectiveness of our business strategies, to make budgeting decisions, and to compare our performance against that of other peer companies using similar measures. See "Non-GAAP Measures" below for a reconciliation of Adjusted EBITDA to net loss, its most directly comparable U.S. GAAP measure.
RESULTS OF OPERATIONS
The following table sets forth a summary of our condensed consolidated results of operations for the three months ended July 31, 2026 and July 25, 2025, and the changes between periods.
| Three Months Ended | Change | ||||||||||||||||||||||
| (Dollars in millions) | July 31, 2026 | July 25, 2025 | Amount | Percent | |||||||||||||||||||
| Net sales | $ | 843 | $ | 723 | $ | 120 | 16.6 | % | |||||||||||||||
| Cost of products sold | 378 | 314 | 65 | 20.7 | % | ||||||||||||||||||
| Gross profit | 465 | 409 | 55 | 13.5 | % | ||||||||||||||||||
| Operating expenses: | |||||||||||||||||||||||
| Research and development expense | 115 | 125 | (10) | (7.8) | % | ||||||||||||||||||
| Selling, general, and administrative expenses | 312 | 283 | 29 | 10.4 | % | ||||||||||||||||||
| Certain litigation charges, net | (2) | 17 | (19) | (113.8) | % | ||||||||||||||||||
| Other operating expense (income), net | 36 | (2) | 37 | NM | |||||||||||||||||||
| Operating income (expense) | 5 | (13) | 18 | 135.4 | % | ||||||||||||||||||
| Other non-operating expense (income), net | - | - | - | NM | |||||||||||||||||||
| Income (loss) before income taxes | 4 | (13) | 17 | 133.0 | % | ||||||||||||||||||
| Income tax provision | 4 | 3 | 1 | 20.8 | % | ||||||||||||||||||
| Net income (loss) | $ | - | $ | (16) | $ | 16 | 100.9 | % | |||||||||||||||
| Net income attributable to noncontrolling interests | $ | - | $ | (3) | $ | 3 | 100.0 | % | |||||||||||||||
| Net income (loss) attributable to the Company | $ | - | $ | (19) | $ | 20 | 100.7 | % | |||||||||||||||
NET SALES
The table below includes net sales by product category for the three months ended July 31, 2026 and July 25, 2025:
| Three Months Ended | Change | ||||||||||||||||||||||
| (in millions) | July 31, 2026 | July 25, 2025 | Amount | Percent | |||||||||||||||||||
| Pumps | $ | 144 | $ | 119 | $ | 26 | 21.5 | % | |||||||||||||||
| Consumables | 261 | 229 | 32 | 13.8 | % | ||||||||||||||||||
| CGM | 431 | 360 | 72 | 19.9 | % | ||||||||||||||||||
|
Other (1)
|
7 | 15 | (9) | (57.1) | % | ||||||||||||||||||
| Total net sales | $ | 843 | $ | 723 | $ | 120 | 16.6 | % | |||||||||||||||
(1)Primarily includes revenue generated from the sale of smart insulin pens and services. Amounts in this line also reflect adjustments to the Company's Italian payback accruals resulting from two rulings in 2024 by the Constitutional Court of Italy and the Legislative Decree published by the Italian government in 2025. Refer to Note 12, Commitments and Contingencies, for more information.
The table below includes net sales by market geography for the three months ended July 31, 2026 and July 25, 2025:
| Three Months Ended | Change | ||||||||||||||||||||||
| (in millions) | July 31, 2026 | July 25, 2025 | Amount | % | |||||||||||||||||||
|
U.S.(1)
|
$ | 240 | $ | 212 | $ | 28 | 13.1 | % | |||||||||||||||
|
International(2)
|
603 | 511 | 92 | 18.1 | % | ||||||||||||||||||
| Total | $ | 843 | $ | 723 | $ | 120 | 16.6 | % | |||||||||||||||
(1) U.S. includes the United States and U.S. territories.
(2) International includes all other non-U.S. countries.
Net sales for the three months ended July 31, 2026 was $843 million as compared to $723 million for the three months ended July 25, 2025. This represents growth of 17% as reported and 16% organic growth. The extra week in our 52-53 week fiscal calendar contributed approximately 4 to 6 percentage points of that growth. International sales increased by 18% and U.S. sales increased 13% primarily as a result of increased volumes, as well as the benefit of the additional week of sales in the current-year period as compared to the prior year period. International net sales growth benefited from strong, broad-based growth across pumps, CGM, and consumables, on expanded Simplera sensor supply and the Instinct sensor launch. For the three months ended July 31, 2026, there was no Italian payback adjustment to net sales as compared to an increase in net sales of $7 million for the three months ended July 25, 2025. This was due to changes in estimates relating to our Italian payback accrual resulting from the two July 2024 rulings by the Constitutional Court and the Legislative Decree published by the Italian government in June 2025, and formalized into law in August 2025 for certain prior years since 2015. U.S. net sales benefited from the launch of MiniMed Flex with Simplera which started shipping in June 2026.
Pump sales grew 22% for the three months ended July 31, 2026. International pump sales were driven by increased availability of new sensors with increased supply of Simplera, as well as the European commercial launch of the Instinct sensor at the start of July. This increased availability of new sensors helped to drive both strong CGM growth as well as strong pump revenue growth. In the U.S., pump sales were driven by the U.S. launch of MiniMed Flex insulin pump system, which started shipping in June with our Simplera sensor. As of July 31, 2026, the MiniMed Flex insulin pump had not yet launched in regions outside the U.S.
Consumables sales increased 14% for the three months ended July 31, 2026. Our growth was the result of increased volume of patients using our AID systems which require frequent replacement of the infusion sets and reservoirs for uninterrupted operation. The increase in the volume of patients using our AID systems across global markets was due to the competitive strength of the MiniMed 780G system and launch of MiniMed Flex in the US which have enabled us to attract new patients as well as retain our existing user base.
CGM sales increased 20% for the three months ended July 31, 2026, as a result of the continued increase in the Global CGM Attachment Rate, which rose from 64% in the three months ended July 25, 2025, to 69% in the three months ended July 31, 2026. CGM sales were boosted by increased Simplera sensor supply in Europe as well as the European commercial launch of the Instinct sensor at the start of July. In the US, CGM sales benefited from continued momentum from the launch of Simplera and Instinct CGM in the third quarter of fiscal year 2026, and the launch of MiniMed Flex insulin pump system with Simplera which started shipping in June 2026.
COSTS AND EXPENSES
The following is a summary of cost of products sold, research and development, and selling, general and administrative expenses as a percentage of net sales for the three months ended July 31, 2026 and July 25, 2025:
| Three Months Ended | % of Net Sales | ||||||||||||||||||||||
|
(Dollars in millions)
|
July 31, 2026 | July 25, 2025 | July 31, 2026 | July 25, 2025 | |||||||||||||||||||
|
Cost of products sold
|
$ | 378 | $ | 314 | 44.9 | % | 43.4 | % | |||||||||||||||
| Research and development expense | $ | 115 | $ | 125 | 13.6 | % | 17.2 | % | |||||||||||||||
| Selling, general, and administrative expenses | $ | 312 | $ | 283 | 37.0 | % | 39.1 | % | |||||||||||||||
Cost of Products Sold and Gross Profit
Cost of products sold for the three months ended July 31, 2026, was $378 million, resulting in gross profit of $465 million, as compared to cost of products sold of $314 million and gross profit of $409 million for the three months ended July 25, 2025. Gross margin for the three months ended July 31, 2026 was 55.1%, compared to 56.6% in the prior year, a decrease of 1.5 percentage points. The decrease in gross margin was primarily driven by the higher mix of Simplera sensors, which currently have a lower gross margin than the Company's legacy and Instinct sensors.
Research and Development Expense
Research and development expense for the three months ended July 31, 2026 was $115 million, as compared to $125 million for the three months ended July 25, 2025. The decrease was primarily driven by a $10 million acquisition of technology not yet approved by regulators during the three months ended July 25, 2025.
Selling, General, and Administrative Expense
Selling, general, and administrative expense for the three months ended July 31, 2026 was $312 million, as compared to $283 million for the three months ended July 25, 2025. The increase was primarily driven by $19 million of incremental commercialization activities to support higher sales of the Company in the current year, as well as a $10 million increase in information technology and software development costs.
Certain Litigation Charges, Net
Certain litigation charges, net was a credit of $2 million for the three months ended July 31, 2026, as compared to a charge of $17 million for the three months ended July 25, 2025. Amounts in both periods primarily related to litigation activity associated with the retainer ring matter. The credit of $2 million during the three months ended July 31, 2026 was related to the reversal of a previous accrual. For additional information, refer to Note 12. "Commitments and Contingencies."
Other Operating Expense (Income), Net
Other operating expense (income), net was $36 million of expense for the three months ended July 31, 2026 as compared to $2 million of income for the three months ended July 25, 2025. The increase was primarily driven by service charges and transition costs arising from the Separation and ongoing agreements with Medtronic following our IPO.
Other Non-Operating Expense (Income), Net
Other non-operating expense (income), net was insignificant for the three months ended July 31, 2026 and July 25, 2025.
INCOME TAXES
We recognized income tax expense of $4 million for the three months ended July 31, 2026, as compared to $3 million for the three months ended July 25, 2025. The change in the effective tax rate and income tax provision primarily related to year-over-year changes in operational results by jurisdiction and the impact of valuation allowances in certain jurisdictions.
NON-GAAP MEASURES
In addition to our financial results determined in accordance with U.S. GAAP, we present certain financial measures that facilitate management's review of the operational performance of the Company and as a basis for strategic planning. However, such financial measures are not presented in our financial statements prepared in accordance with U.S. GAAP. These financial measures are considered "non-GAAP financial measures" and are intended to supplement, and should not be considered as superior to, financial measures presented in accordance with U.S. GAAP. These include Organic Revenue Growth, Adjusted Gross Profit, and Adjusted EBITDA. We believe that non-GAAP financial measures provide information useful to investors in understanding our underlying operational performance and trends and may facilitate comparisons with the performance of other companies in the medical technologies industry.
In addition to our financial results determined in accordance with U.S. GAAP, we believe the following non-GAAP measures are useful in evaluating our operating performance. We use the following non-GAAP financial measures to evaluate our ongoing operations and for internal planning and forecasting purposes. We believe that these non-GAAP financial measures, when taken together with the corresponding U.S. GAAP financial measures, provide meaningful supplemental information regarding our performance by excluding certain items that may not be indicative of our business, results of operations, or outlook.
In particular, we believe that the use of Organic Revenue Growth, Adjusted Gross Profit, and Adjusted EBITDA are helpful to our investors as they are metrics used by management to assess the health of our business and our operating performance. However, non-GAAP financial information is presented for supplemental informational purposes only, has limitations as an analytical tool, and should not be considered in isolation or as a substitute for financial information presented in accordance with U.S. GAAP. In evaluating the non-GAAP financial information presented, investors should be aware that in the future the Company may incur expenses that are the same as or similar to some of the adjustments in such presentation and the Company's presentation of non-GAAP information should not be construed as an inference that its future results will be unaffected by unusual or non-recurring items. In addition, other companies, including companies in our industry, may calculate similarly titled non-GAAP measures differently or may use other measures to evaluate their performance, all of which could reduce the usefulness of our non-GAAP financial measures as tools for comparison.
A reconciliation is provided below for each non-GAAP financial measure to the most directly comparable financial measure stated in accordance with U.S. GAAP. Investors are encouraged to review the related U.S. GAAP financial measures and the reconciliation of these non-GAAP financial measures to their most directly comparable U.S. GAAP financial measures, and not to rely on any single financial measure to evaluate our business.
Organic Revenue Growth
Organic Revenue Growth measures our revenue growth trends excluding the impacts of foreign currency rate fluctuations and adjustments to the Company's Italian payback accrual for certain prior years since 2015, which is further described in Note 12. "Commitments and Contingencies," to the condensed consolidated financial statements. We use Organic Revenue Growth to assess our performance on a consistent basis by removing the impacts of foreign currency rate fluctuations and adjustments to the Italian payback accrual that we believe do not directly reflect our underlying operations.
The following table presents a reconciliation of U.S. GAAP net sales to Organic Revenue Growth for the three months ended July 31, 2026 and July 25, 2025:
| Three Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||
| Reported net sales | Adjustments | Organic Revenue | |||||||||||||||||||||||||||||||||||||||||||||
| (in millions) | July 31, 2026 | July 25, 2025 | Growth |
July 31, 2026(2)
|
July 25, 2025(3)
|
July 31, 2026(2)
|
July 25, 2025(3)
|
Growth | |||||||||||||||||||||||||||||||||||||||
|
U.S.(1)
|
$ | 240 | $ | 212 | 13.1 | % | $ | - | $ | - | $ | 240 | $ | 212 | 13.1 | % | |||||||||||||||||||||||||||||||
|
International(1)
|
603 | 511 | 18.1 | % | 14 | 7 | 589 | 504 | 16.9 | % | |||||||||||||||||||||||||||||||||||||
| Total | $ | 843 | $ | 723 | 16.6 | % | $ | 14 | $ | 7 | $ | 829 | $ | 716 | 15.8 | % | |||||||||||||||||||||||||||||||
(1) U.S. includes the United States and U.S. territories. International includes all other non-U.S. countries.
(2) The three months ended July 31, 2026 excludes $14 million of revenue adjustments, of favorable currency impact on the remaining net sales. The currency impact to net sales measures the change in net sales between current and prior year periods using constant exchange rates.
(3) The three months ended July 25, 2025 excludes $7 million of Italian payback accruals as a result of the two July 22, 2024 rulings by the Constitutional Court of Italy for certain prior years since 2015.
Adjusted Gross Profit
Adjusted Gross Profit measures our gross profit excluding the impact of factors unrelated to overall operating performance. Management uses Adjusted Gross Profit to assess our overall performance on a consistent basis by removing the impact of certain items that we believe do not directly reflect our underlying operations. We calculate Adjusted Gross Profit as U.S. GAAP gross profit, adjusted for the amortization of intangible assets and certain other non-operational items.
The following table presents a reconciliation of U.S. GAAP gross profit to Adjusted Gross Profit for the three months ended July 31, 2026 and July 25, 2025:
| Three Months Ended | |||||||||||
| (in millions) | July 31, 2026 | July 25, 2025 | |||||||||
|
Gross profit
|
$ | 465 | $ | 409 | |||||||
| Adjustments: | |||||||||||
| Amortization of intangible assets | 6 | 6 | |||||||||
|
Other adjustments (1)
|
- | (7) | |||||||||
| Adjusted Gross Profit (Non-GAAP) | $ | 471 | $ | 409 | |||||||
(1) Reflects adjustments to the Company's Italian payback accruals resulting from the two July 22, 2024 rulings by the Constitutional Court and the Legislative Decree published by the Italian government on June 30, 2025 for certain prior years since 2015.
Adjusted EBITDA
Adjusted EBITDA is a non-GAAP financial measure that we use to assess our overall performance. Management uses Adjusted EBITDA for business planning purposes as this measure facilitates internal comparisons of our historical operating performance on a more consistent basis. We calculate Adjusted EBITDA as Net Loss before interest, taxes, depreciation, and amortization, further adjusted to remove the impact of certain other non-operational items.
The following table presents a reconciliation of U.S. GAAP net loss to Adjusted EBITDA for the three months ended July 31, 2026 and July 25, 2025.
| Three Months Ended | |||||||||||
| (in millions) | July 31, 2026 | July 25, 2025 | |||||||||
|
Net income (loss)
|
$ | - | $ | (16) | |||||||
| Income tax provision | 4 | 3 | |||||||||
| Depreciation and amortization | 41 | 39 | |||||||||
| Adjustments: | |||||||||||
| Stock-based compensation | 10 | 9 | |||||||||
|
Restructuring and associated costs (1)
|
2 | 3 | |||||||||
|
Certain litigation charges, net (2)
|
(2) | 17 | |||||||||
|
Transaction costs (3)
|
27 | 2 | |||||||||
|
Other adjustments (4)
|
- | (7) | |||||||||
| Adjusted EBITDA | $ | 83 | $ | 50 | |||||||
(1) All periods presented include charges related to employee termination benefits and consulting expenses directly related to the restructuring efforts.
(2) Charges primarily relate to the Diabetes Pump Retainer Ring litigation and accruals associated with other legal proceedings, including matters resolved during the period.
(3) These charges represent costs incurred associated with the Separation.
(4) Reflects adjustments to the Company's Italian payback accruals resulting from the two July 22, 2024 rulings by the Constitutional Court and the Legislative Decree published by the Italian government on June 30, 2025 for certain prior years since 2015.
LIQUIDITY AND CAPITAL RESOURCES
Liquidity
As of July 31, 2026, we had $207 million in cash and cash equivalents, and we had no long-term debt outstanding. Our primary sources of liquidity are cash and cash equivalents on hand, cash generated from operations, and available borrowings under our revolving credit facility. We believe that our cash and cash equivalents, future cash flows from operations, and availability under our revolving credit facility, will be sufficient to fund our ongoing core business activities for at least the next twelve months.
Following our Separation and the completion of our initial public offering in March 2026, we manage our own cash and financing activities and no longer participate in Medtronic's centralized cash management programs. Our liquidity requirements are primarily driven by working capital needs, investments in product innovation and commercialization activities, capital expenditures, and other general corporate purposes.
We maintain a five-year senior secured revolving credit facility (the "Revolving Credit Facility") with an aggregate available principal amount of up to $500 million, available in U.S. dollars and certain approved alternative currencies. For further information, see Note 7. "Debt" to the condensed consolidated financial statements.
The following is a summary of cash (used in) provided by operating, investing, and financing activities, the effect of exchange rate changes on cash and cash equivalents, and the net change in cash and cash equivalents:
| Three Months Ended | |||||||||||
| (in millions) | July 31, 2026 | July 25, 2025 | |||||||||
| Cash provided by (used in): | |||||||||||
| Operating activities | $ | (49) | $ | (141) | |||||||
| Investing activities | (41) | (63) | |||||||||
| Financing activities | - | 202 | |||||||||
| Effect of exchange rate changes on cash and cash equivalents | (1) | - | |||||||||
| Net change in cash and cash equivalents | $ | (91) | $ | (2) | |||||||
Operating Activities
Net cash used in operating activities was $49 million for the three months ended July 31, 2026, compared to $141 million for the three months ended July 25, 2025. For the three months ended July 31, 2026, we reported break-even net income, net non-cash adjustments were $62 million, and the change in operating assets and liabilities was a decrease of $111 million. For the three months ended July 31, 2025, we incurred a $16 million net loss, net non-cash adjustments were $64 million, and the change in operating assets and liabilities was a decrease of $188 million.
Investing Activities
Net cash used in investing activities was $41 million for the three months ended July 31, 2026, which primarily consisted of purchases of property and equipment, primarily consisting of capital expenditures supporting product development and manufacturing efforts. Net cash used in investing activities was $63 million for the three months ended July 25, 2025, which consisted of $53 million in purchases of property and equipment, and $10 million cash paid for certain technology purchase arrangements.
Financing Activities
Net cash used in financing activities was not material for the three months ended July 31, 2026. Net cash provided in financing activities of $202 million for the three months ended July 25, 2025 consisted of transfers from the Parent.
Contractual Obligations and Commitments
Leases
We have entered into various operating leases for certain office, manufacturing, and research facilities and warehouses, as well as transportation and other equipment. For a description of our contractual obligations related to leases, refer to Note 10. "Leases," to the condensed consolidated financial statements.
Revolving Credit Facility
The Company is party to certain indebtedness arrangements, including the Revolving Credit Facility due 2031 providing up to $500 million of revolving borrowings for which none was outstanding as of July 31, 2026. For a more detailed discussion of the material terms of the Revolving Credit Facility, see Note 7. "Debt," to the condensed consolidated financial statements, included in our Annual Report on Form 10-K for the fiscal year ended April 24, 2026.
Research and Development Arrangements
The development of certain products, including MiniMed Flex, has been funded in part through research and development funding arrangements with Blackstone. Under these arrangements, following U.S. regulatory approval and commercial launch, we are required to make future payments to Blackstone. Following the commercial launch of MiniMed Flex in the U.S., we are required to make royalty and minimum payments to Blackstone. These obligations are expected to represent a significant use of cash during the initial commercialization period of MiniMed Flex and will be funded through cash on hand, cash generated from operations, and available borrowing capacity under our revolving credit facility. For additional information regarding these arrangements, see Note 11. "Research and Development Funding Arrangements."
Critical Accounting Policies and Estimates
We have used various accounting policies to prepare the condensed consolidated financial statements in accordance with U.S. GAAP. The preparation of these condensed consolidated financial statements requires management to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses and the disclosure of contingent assets and liabilities in our condensed consolidated financial statements and accompanying notes as of the date of the financial statements. We evaluate our estimates and judgments on an ongoing basis. We base our estimates on historical experience and on various other factors that we believe are reasonable under the circumstances, the results of which form the basis for making judgments about our financial condition and results of operations that are not readily apparent from other sources. Some of those judgments can be subjective and complex, and therefore, actual results could differ materially from those estimates under different assumptions or conditions. There have been no material changes to our critical accounting policies and estimates from the information provided in our Annual Report on Form 10-K for the fiscal year ended April 24, 2026.
New Accounting Pronouncements
Information regarding new accounting pronouncements is included in Note 2. "Summary of Significant Accounting Policies," to the condensed consolidated financial statements.
Other Information
Our website is www.minimed.com. Information contained on our website is not part of this report. Information that we furnish to or file with the SEC, including our annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and any amendments to, or exhibits included in, these reports are made available for download, free of charge, through our website as soon as reasonably practicable. Our SEC filings, including exhibits filed therewith, are also available directly on the SEC's website at www.sec.gov.
We may use our website as a distribution channel of material MiniMed information. Financial and other important information regarding MiniMed is routinely posted on and accessible through our website at https://investors.minimed.com. Accordingly, investors should monitor this channel, in addition to following our press releases, SEC filings and public conference calls and webcasts. The contents of our website are not a part of this report.
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
This Quarterly Report contains, and management may make, certain "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. All statements, other than statements of historical facts, may be forward-looking statements. Words such as "anticipate," "believe," "could," "estimate," "expect," "forecast," "intend," "looking ahead," "may," "plan," "possible," "potential," "project," "should," "will," and similar words or expressions are used to identify these forward-looking statements. These statements include, among other things, MiniMed Group, Inc.'s ("MiniMed's" or the "Company's") statements about:
•our ability to drive long-term stockholder value;
•development and future launches of products and continued or future acceptance of products, therapies, and services in our segments;
•expected timing for completion of research studies relating to our products;
•integration of new technologies, including AI and data analytics, into our products, therapies, and services;
•market positioning and performance of our products, including stabilization of certain product markets;
•divestitures and the potential benefits thereof;
•the costs and benefits of integrating previous acquisitions;
•anticipated timing for U.S. FDA and non-U.S. regulatory approval or clearance of new products;
•increased presence in new markets, including markets outside the United States;
•changes in the market and our market share;
•our ability to meet growing demand for our existing products; acquisitions and investment initiatives, including the timing of regulatory approvals as well as integration of acquired companies into our operations;
•the resolution of tax matters;
•our approach towards cost containment;
•our expectations regarding healthcare costs, including potential changes to reimbursement policies and pricing pressures;
•our expectations regarding changes to patient standards of care;
•our ability to identify and maintain successful business partnerships;
•the elimination of certain positions or costs related to restructuring initiatives;
•outcomes in our litigation matters and governmental proceedings and investigations;
•general economic conditions;
•the adequacy of available working capital and our working capital needs;
•our payment of dividends and redemption of shares;
•the continued strength of our balance sheet and liquidity;
•our accounts receivable exposure;
•our human capital management with respect to our global workforce;
•the management of environmental, health, and safety ("EHS") and sustainability matters; and
•the potential impact of our compliance with governmental laws and regulations and accounting guidance.
The Company cautions investors that such statements are subject to risks and uncertainties, many of which are difficult to predict and generally beyond the Company's control, that could cause actual results to differ materially from those expressed in, or implied or projected by, the forward-looking information and statements.
For a list of certain factors that could cause actual results to differ, refer to "Summary of Risk Factors" in our Annual Report on Form 10-K for the fiscal year ended April 24, 2026 which was filed with the Securities and Exchange Commission (the "SEC") on June 29, 2026 (our "2026 Form 10-K"). The Company's forward-looking statements speak only as of the date of this report or as of the date they are made, and the Company undertakes no obligation to update forward-looking statements. For a more detailed discussion of these factors, see Part I, Item 1A "Risk Factors" in our 2026 Form 10-K and any additional risks described in our other filings with the SEC.
MiniMed Group Inc. published this content on September 08, 2026, and is solely responsible for the information contained herein. Distributed via EDGAR on September 08, 2026 at 20:29 UTC. If you believe the information included in the content is inaccurate or outdated and requires editing or removal, please contact us at [email protected]