Why Tandem Diabetes Care Stock Popped Today

The med tech supplier is shifting to a more predictable and lucrative business model.Shares of Tandem Diabetes Care (TNDM +32.67%) leaped on Friday after the insulin delivery specialist reported significant gains in profitability. By the close of trading, Tandem's stock price was up more than 32%. Image source: Getty Images. A new revenue model is driving margin expansion Tandem's sales grew 3% year over year to $290 million in the fourth quarter. Worldwide shipments of its insulin pumps climbed to 38,000, including 27,000 in the U.S. The medical device maker is shifting to a pay-as-you-go pharmacy structure, which lowers upfront costs for customers and generates recurring revenue for Tandem. ExpandNASDAQ: TNDMTandem Diabetes CareToday's Change(32.67%) $6.05Current Price$24.57Key Data PointsMarket Cap$1.3BDay's Range$22.00 - $26.2152wk Range$9.98 - $35.12Volume13MAvg Vol1.5MGross Margin53.23% Moreover, Tandem's gross margin improved to 58% from 56% in the year-ago quarter. That helped increase its operating income to $8.3 million, compared with a loss of $0.6 million in the prior-year period. "2025 was a defining year for Tandem as we surpassed $1 billion in worldwide sales and set gross margin records, while modernizing our commercial operations, reshaping our business model, and driving innovation," CEO John Sheridan said in a press release. Management sees modest yet profitable growth in 2026 Tandem expects full-year sales of $1.065 billion to $1.085 billion, with gross margins of 56% to 57%. "We are adopting a pay-as-you-go model in the U.S. that provides affordable access to customers -- and progresses our business toward more predictable and profitable revenue that may not be evident in our 2026 sales expectations," chief financial officer Leigh Vosseller said.Read NextDec 12, 2025 •By Prosper Junior BakinyDon't Buy Tandem Diabetes Care Until This Big Thing HappensOct 1, 2024 •By Eric VolkmanWhy Tandem Diabetes Care Stock Took It on the Chin TuesdaySep 19, 2024 •By Eric VolkmanWhy Tandem Diabetes Care Stock Thrashed the Market TodayMay 3, 2024 •By Rich SmithWhy Tandem Diabetes Stock Just Jumped 22%Apr 7, 2024 •By Prosper Junior Bakiny1 Beaten-Down Stock That Could Make You RicherMar 26, 2024 •By Eric VolkmanWhy Tandem Diabetes Care Stock Was Zooming Higher TodayAbout the AuthorJoe Tenebruso is a contributing Motley Fool stock market analyst with more than 3,000 financial bylines to his name. Joe was an investment analyst for Stock Advisor, Income Investor, Crypto Society, and other top-rated investing services. He also managed Tier 1 Investments, a market-crushing real-money portfolio with 24.58% annualized returns. Joe graduated summa cum laude from Rutgers University with a Bachelor of Science in Finance.tmfguardianX@Tier1InvestorStocks MentionedTandem Diabetes CareNASDAQ: TNDM$24.57 (+32.67%) $+6.05*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.