PODD · 10-Q · 2026Q2 · Full report

Gross Margin Drivers

INSULET CORP · 2026-08-05 · Importance 59 · Surprise 48 · In source text

Three-month cost of revenue increased $42.3 million, or 21.5%, to $239.1 million, while gross margin expanded 50 basis points to 70.2% from 69.7%. The quarterly margin improvement was primarily driven by manufacturing efficiencies and higher customer volumes, partly offset by higher warranty costs from the May 2026 voluntary medical device correction. Six-month cost of revenue rose $115.0 million, or 32.2%, to $471.8 million, and gross margin declined 90 basis points to 69.8% because of higher warranty costs and inventory excess and obsolescence reserves during the transition to new Pod configurations. Improved manufacturing efficiencies and higher average selling prices partially offset the six-month pressure.

Key facts

• Cost of revenue for the three months ended June 30, 2026 increased $42.3 million, or 21.5%, to $239.1 million, compared with $196.9 million for the three months ended June 30, 2025. source
• Cost of revenue for the six months ended June 30, 2026 increased $115.0 million, or 32.2%, to $471.8 million, compared with $356.8 million for the six months ended June 30, 2025. source
• Gross profit for the three months ended June 30, 2026: $562.6 million; cost of revenue: $239.1 million. source
• Gross margin was 70.2% for the three months ended June 30, 2026, compared with 69.7% for the three months ended June 30, 2025. source
• Gross margin was 69.8% for the six months ended June 30, 2026, compared with 70.7% for the six months ended June 30, 2025. source

Impact estimates