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  "docSlug": "34401c2968d1",
  "documentTitle": "Dexcom, Inc. (DXCM)",
  "authorId": "54_Spruce_Point_Capital",
  "authorName": "Ben Axler",
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  "sourceTypeSlug": "short_seller",
  "sourceTypeLabel": "Short seller",
  "presentationDate": "2019-03-21 00:00:00",
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  "pageNumber": 69,
  "pageCount": 83,
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  "slideType": "expose_contradiction",
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  "density": "overcrowded",
  "nDataPoints": 14,
  "notes": "The slide uses a causal-chain framework to link management actions (price hikes, product rollouts) to customer behavior (stockpiling) and financial outcomes (revenue growth).",
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      "kind": "callout",
      "text": "Q3 to Q4 FY18: Management raises price of G5 transmitter to $599 from $300 to force customers to switch to G6. Stockpiling ceases, but sensor AND transmitter sales see accelerated growth at similar rates as G4 and G5 users purchase new G6 equipment en masse.",
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      "text": "Q2 to Q3 FY18: FDA approves G6 in Q2. Management accelerates G6 rollout to end of Q2. Stockpiling of G4 and G5 continues through Q2-Q3. Sensor sales growth levels off but remains elevated due to stockpiling.",
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      "text": "Q1 to Q2 FY18: DXCM announces G6 under review by FDA in Q1. In Q2, G4 and G5 users begin to stockpile legacy sensors in anticipation of a forced switch to a more expensive and potentially unhackable G6. Sensor sales growth accelerates in Q2.",
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      "text": "We find it interesting that management raised the price of G5 transmitters such that the annual cost of continuing to use a hacked G5 is now almost identical to the annual cost of using a G6.",
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      "text": "Sensor Revenue Growth vs. Transmitter Revenue Growth",
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      "text": "While we believe that legacy sensor stockpiling is but one factor among several which might have contributed to the sensor growth / transmitter growth decoupling, we note that observed growth patterns in sensor revenue and transmitter revenue match what we would expect to see if G4 and G5 users did in fact stockpile sensors.",
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      "text": "We find it interesting that management raised the price of G5 transmitters such that the annual cost of continuing to use a hacked G5 is now almost identical to the annual cost of using a G6. We suspect that management may have been aware of the G4/G5 stockpiling and recognizes that recent sales growth may be inflated due to this behavior.",
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      "text": "Sensor Revenue Growth Pattern vs. Transmitter Revenue Growth Conforms To Stockpiling Hypothesis",
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