Insulin delivery company Insulet Corporation (NASDAQ: PODD) announced better-than-expected revenue in Q2 CY2026, with sales up 23.5% year on year to $801.7 million. On the other hand, next quarter’s revenue guidance of $833.4 million was less impressive, coming in 1.6% below analysts’ estimates. Its non-GAAP profit of $1.66 per share was 14.3% above analysts’ consensus estimates.

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Company Overview

Revolutionizing diabetes care with its tubeless "Pod" technology, Insulet (NASDAQ: PODD) develops and manufactures innovative insulin delivery systems for people with diabetes, primarily through its Omnipod product line.

Revenue Growth

A company’s long-term performance is an indicator of its overall quality. Any business can have short-term success, but a top-tier one grows for years. Over the last five years, Insulet grew its sales at an excellent 25.1% compounded annual growth rate. Its growth surpassed the average healthcare company and shows its offerings resonate with customers, a great starting point for our analysis.

We at StockStory place the most emphasis on long-term growth, but within healthcare, a half-decade historical view may miss recent innovations or disruptive industry trends. Insulet’s annualized revenue growth of 27.7% over the last two years is above its five-year trend, suggesting its demand was strong and recently accelerated.

We can better understand the company’s sales dynamics by analyzing its constant currency revenue, which excludes currency movements that are outside their control and not indicative of demand. Over the last two years, its constant currency sales averaged 26.7% year-on-year growth. Because this number aligns with its reported revenue growth, we can see that foreign exchange has not had a meaningful impact on topline.

This quarter, Insulet reported robust year-on-year revenue growth of 23.5%, and its $801.7 million of revenue topped Wall Street estimates by 1.9%. Company management is currently guiding for a 18% year-on-year increase in sales next quarter.

Looking further ahead, sell-side analysts expect revenue to grow 17.9% over the next 12 months, a deceleration versus the last two years. Still, this projection is admirable and suggests the market is baking in success for its products and services.

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Adjusted Operating Margin

Adjusted operating margin is a key measure of profitability. Think of it as net income (the bottom line) excluding the impact of non-recurring expenses, taxes, and interest on debt - metrics less connected to business fundamentals.

Insulet has done a decent job managing its cost base over the last five years. The company has produced an average adjusted operating margin of 14.9%, higher than the broader healthcare sector.

Analyzing the trend in its profitability, Insulet’s adjusted operating margin rose by 7.4 percentage points over the last five years, as its sales growth gave it operating leverage. Zooming in on its more recent performance, we can see the company’s trajectory is intact as its margin has also increased by 3.6 percentage points on a two-year basis. These data points are very encouraging and show momentum is on its side.

In Q2, Insulet generated an adjusted operating margin profit margin of 18.6%, in line with the same quarter last year. This indicates the company’s overall cost structure has been relatively stable.

Earnings Per Share

Revenue trends explain a company’s historical growth, but the long-term change in earnings per share (EPS) points to the profitability of that growth — for example, a company could inflate its sales through excessive spending on advertising and promotions.

Insulet’s EPS grew at 85.2% compounded annual growth rate over the last five years, higher than its 25.1% annualized revenue growth. This tells us the company became more profitable on a per-share basis as it expanded.

Diving into Insulet’s quality of earnings can give us a better understanding of its performance. As we mentioned earlier, Insulet’s adjusted operating margin was flat this quarter but expanded by 7.4 percentage points over the last five years. This was the most relevant factor (aside from the revenue impact) behind its higher earnings; interest expenses and taxes can also affect EPS but don’t tell us as much about a company’s fundamentals.

In Q2, Insulet reported adjusted EPS of $1.66, up from $1.17 in the same quarter last year. This print easily cleared analysts’ estimates, and shareholders should be content with the results. Over the next 12 months, Wall Street expects Insulet’s full-year EPS to grow 20.7% from $5.87 to $7.08.

Key Takeaways from Insulet’s Q2 Results

It was good to see Insulet beat analysts’ EPS expectations this quarter. We were also happy its revenue outperformed Wall Street’s estimates. On the other hand, its revenue guidance for next quarter missed. Investors were likely hoping for more, and shares traded down 9.6% to $150.83 immediately following the results.

Is Insulet an attractive investment opportunity right now? When making that decision, it’s important to consider its valuation, business qualities, as well as what has happened in the latest quarter. We cover that in our actionable full research report which you can read here (it’s free).