Inspire Reports Year-over-YearRevenue Growth of 28% in the First Quarter and Expects Profitability for the Full Year 2024 MINNEAPOLIS, May 07, 2024 (GLOBE NEWSWIRE) -- Inspire Medical Systems, Inc. (NYSE:INSP) (Inspire), a medical technology company focused on the development and commercialization of innovative, minimally invasive solutions for patients with obstructive sleep apnea, today reported financial results for the quarter ended March 31, 2024. Recent Business Highlights Generated revenue of $164.0  ...

MINNEAPOLIS, April 30, 2024 (GLOBE NEWSWIRE) -- Inspire Medical Systems, Inc. (NYSE: INSP) (Inspire), a medical technology company focused on the development and commercialization of innovative, minimally invasive solutions for patients with obstructive sleep apnea, announced today that its management team will present at the BofA Securities 2024 Health Care Conference on Tuesday, May 14, 2024. Inspire is scheduled to present at 7:20 p.m. Eastern Time. The presentation will be accessible via a live webcast ...

Inspire Medical Systems, Inc. (INSP) has been gaining from its focus on research and development (R&D). The optimism led by a solid fourth-quarter 2023 performance and its global presence are expected to contribute further. However, concerns regarding overdependence on the Inspire system and a competitive landscape prevail.Over the past year, this Zacks Rank #1 (Strong Buy) stock has lost 8.1% compared with the 21.8% decline of the industry. The S&P 500 has witnessed 21.7% growth in the said time frame.The ...

Inspire Medical Systems (INSP) shares rallied 9.9% in the last trading session to close at $243.51. This move can be attributable to notable volume with a higher number of shares being traded than in a typical session. This compares to the stock's 8.4% gain over the past four weeks.Shares of the company surged likely in anticipation of improved earnings for its first quarter results scheduled to release on May 07, 2024. Loss estimates for the first quarter have narrowed in the past 30 days.This maker of dev ...

Here are five stocks added to the Zacks Rank #1 (Strong Buy) List today:Surmodics, Inc. (SRDX) : This medical device coating technology provider has seen the Zacks Consensus Estimate for its current year earnings increasing 10.9% over the last 60 days.United States Steel Corporation (X) : This steel manufacturing company has seen the Zacks Consensus Estimate for its current year earnings increasing 17.2% over the last 60 days.Telenor ASA (TELNY) : This telecommunication company has seen the Zacks Consensus ...

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K (Mark One) ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2023 or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission File Number: 001-38468 Inspire Medical Systems, Inc. (Exact name of registrant as specified in its charter) (State or other jurisdi ...

Financial Data and Key Metrics Changes - The company reported a net income of $14.8 million for Q4 2023, a significant increase from $3.2 million in the same period last year, resulting in diluted net income per share of $0.49 compared to $0.10 in Q4 2022 [6][28] - Total revenue for Q4 was $192.5 million, representing a 40% increase from $137.9 million in Q4 2022 [24][108] - Full year revenue for 2023 totaled $624.8 million, a 53% increase over $407.9 million in 2022 [109] Business Line Data and Key Metrics Changes - US revenue in Q4 was $189.4 million, a 41% increase from $134.3 million in the prior year period, driven by higher utilization at existing centers and the addition of new implanting centers [24][108] - International revenue decreased by 16% to $3.1 million due to delays in EU MDR approval affecting shipments [9][74] Market Data and Key Metrics Changes - The average selling price (ASP) in the US for Q4 was $25,000, slightly up from $24,900 in the prior year, while the ASP outside the US was $19,900, down from $20,400 [9] - The company expects full year revenue for 2024 to be in the range of $775 million to $785 million, representing a 24% to 26% increase compared to 2023 [10][105] Company Strategy and Development Direction - The company plans to focus on increasing procedure volumes at existing centers while training and opening new implanting centers, with expectations to activate 52 to 56 new centers per quarter in 2024 [83][87] - The introduction of the SleepSync digital platform aims to enhance patient experience and streamline management [8][107] - The Inspire V system is expected to have a limited market release in 2024, with a full launch targeted for 2025 [76][116] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving steady profitability in the second half of 2024, driven by improved operating leverage and strong patient demand [29][105] - The company anticipates pronounced seasonality in Q1 2024, following a strong Q4 2023, but expects to return to growth thereafter [29][100] Other Important Information - The company has onboarded a third-party vendor to assist with the prior authorization process, enhancing capacity to meet growing patient demand [7] - The gross margin for Q4 was 85.4%, up from 83.9% in the prior year, attributed to improved manufacturing yields and higher volumes [86] Q&A Session Summary Question: Can you provide more detail on the 2024 guidance? - Management indicated that the guidance includes expectations for utilization growth and the impact of label expansion and the Gen 5 launch [11][12] Question: What is the status of the Inspire V submission to the FDA? - The company is completing final testing and documentation for the Inspire V submission, targeting approval for a limited launch in 2024 [14][116] Question: How are investments in sleep centers performing? - Management noted that investments in sleep centers are aimed at easing bottlenecks and improving patient throughput, with ongoing education for sleep physicians [47][120] Question: What impact do you foresee from competition in the market? - The company is aware of competition and believes its clinical evidence remains superior, focusing on patient care and therapy adoption [140][158] Question: How will the new policy changes by UnitedHealthcare affect patient flow? - Management does not anticipate significant impact from UnitedHealthcare's new requirements, as most patients have already attempted CPAP therapy [142][161]

1 Inspire Medical Systems, Inc. February 2024 NYSE: INSP This presentation contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. All statements other than statements of historical facts are forward-looking statements. In some cases, you can identify forward-looking statements by terms such as ''may,'' ''will,'' ''should,'' ''expect,'' ''plan,'' ''anticipate,'' ''could,'' "future," "outlook," ''intend,'' ''target,'' ''project,'' ''contemplate,'' ''bel ...

Company Overview - Inspire is the first and only FDA-approved neurostimulation technology for Obstructive Sleep Apnea (OSA)[27] - Over 50,000 patients have been treated with Inspire therapy[21, 27, 99] - The company has a well-capitalized balance sheet with $467 million in net cash as of September 30, 2023[27, 114] - Inspire has a strong financial profile with 83-85% gross margin[33] Market Opportunity - Approximately 17 million individuals in the U S have moderate to severe OSA[40] - The annual U S economic costs of untreated moderate to severe OSA are between $65 - $165 billion[40] - Inspire U S market is approximately $10 billion[41, 44] Financial Performance & Growth - The company's revenue has grown at a CAGR of 70% from 2017 to 2022[91] - Q3 2023 revenue was $153.3 million[114, 119] - The gross margin in Q3 2023 was 84.1%[114, 119] - The company expects FY2023 revenue to be in the range of $608M - $612M, representing 49% - 50% growth over FY2022[109] Patient Outcomes & Therapy - Inspire has a 4% risk of readmission vs ~15-20% for Palate and Multilevel surgeries[53] - Inspire has a 2% complication rate vs 15-20% for Palate and Multilevel surgeries[57] - 91% of patients say Inspire is better than CPAP, 93% would recommend Inspire, 92% would choose Inspire again, and 90% are satisfied with Inspire[86]

PART I [Consolidated Financial Statements](index=5&type=section&id=Item%201.%20Consolidated%20Financial%20Statements) The company's consolidated financial statements for Q3 2023 demonstrate strong revenue growth, improved net loss, and a shift to positive operating cash flow, supported by a robust balance sheet [Balance Sheets](index=5&type=section&id=Balance%20Sheets) - Total assets grew to **$639.5 million** as of September 30, 2023, from **$564.9 million** at year-end 2022, primarily due to increases in short-term investments, property and equipment, and operating lease right-of-use assets[19](index=19&type=chunk) - Stockholders' equity increased to **$544.2 million** from **$496.0 million**, driven by additional paid-in capital from stock-based compensation and option exercises, which offset the accumulated deficit from net losses[19](index=19&type=chunk) Consolidated Balance Sheet Highlights (in thousands) | Account | Sep 30, 2023 | Dec 31, 2022 | | :--- | :--- | :--- | | **Assets** | | | | Cash and cash equivalents | $329,897 | $441,592 | | Total current assets | $569,591 | $530,032 | | Total assets | $639,494 | $564,876 | | **Liabilities & Equity** | | | | Total current liabilities | $69,995 | $61,186 | | Total liabilities | $95,314 | $68,868 | | Total stockholders' equity | $544,180 | $496,008 | [Statements of Operations and Comprehensive Loss](index=6&type=section&id=Statements%20of%20Operations%20and%20Comprehensive%20Loss) - Revenue for Q3 2023 increased by **40.4%** year-over-year, while for the nine-month period, it grew by **60.1%**[22](index=22&type=chunk) - Net loss for Q3 2023 significantly narrowed to **$8.5 million** from **$16.8 million** in Q3 2022, demonstrating improved profitability at a higher revenue scale[22](index=22&type=chunk) Statement of Operations Summary (in thousands, except per share data) | Metric | Q3 2023 | Q3 2022 | 9 Months 2023 | 9 Months 2022 | | :--- | :--- | :--- | :--- | :--- | | Revenue | $153,302 | $109,188 | $432,291 | $269,956 | | Gross Profit | $128,920 | $89,402 | $363,769 | $225,993 | | Gross Margin | 84.1% | 81.9% | 84.1% | 83.7% | | Operating Loss | $(13,471) | $(17,194) | $(49,568) | $(47,257) | | Net Loss | $(8,540) | $(16,847) | $(35,916) | $(48,031) | | Net Loss Per Share | $(0.29) | $(0.60) | $(1.23) | $(1.73) | [Statements of Stockholders' Equity](index=7&type=section&id=Statements%20of%20Stockholders'%20Equity) - Total stockholders' equity increased from **$496.0 million** at the end of 2022 to **$544.2 million** as of September 30, 2023[24](index=24&type=chunk) - The increase in equity was primarily driven by **$83.9 million** in additional paid-in capital, mainly from stock option exercises and stock-based compensation expense, which was partially offset by a net loss of **$35.9 million** for the nine-month period[24](index=24&type=chunk) [Statements of Cash Flows](index=9&type=section&id=Statements%20of%20Cash%20Flows) - Cash from operations turned positive at **$7.4 million** for the first nine months of 2023, compared to a use of **$7.7 million** in the prior-year period, primarily due to a smaller net loss and higher non-cash charges like stock-based compensation[28](index=28&type=chunk) - Investing activities used **$143.1 million**, largely for the purchase of **$137.3 million** in investments, a significant increase from the prior year[28](index=28&type=chunk) - Financing activities in 2022 included **$243.8 million** from a follow-on stock offering, which was not repeated in 2023. In 2023, financing cash flow was primarily from stock option exercises[28](index=28&type=chunk)[33](index=33&type=chunk) Consolidated Statement of Cash Flows Summary (in thousands) | Cash Flow Activity | Nine Months Ended Sep 30, 2023 | Nine Months Ended Sep 30, 2022 | | :--- | :--- | :--- | | Net cash provided by (used in) operating activities | $7,386 | $(7,700) | | Net cash used in investing activities | $(143,099) | $(16,646) | | Net cash provided by financing activities | $24,065 | $227,788 | | **(Decrease) increase in cash and cash equivalents** | **$(111,695)** | **$203,341** | [Notes to Consolidated Financial Statements](index=10&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) - The company's primary business is the development and commercialization of its Inspire system, a neurostimulation technology for treating moderate to severe Obstructive Sleep Apnea (OSA)[30](index=30&type=chunk) - Revenue is derived from product sales to hospitals and ambulatory surgery centers and is recognized when the customer obtains control of the product, typically upon shipment[66](index=66&type=chunk)[67](index=67&type=chunk) - The company amended its corporate headquarters lease in May 2023, increasing the space and extending the term through May 2035, resulting in a non-cash increase to the right-of-use asset and lease liability of **$15.1 million**[87](index=87&type=chunk) - The company operates as a single operating segment. For the nine months ended September 30, 2023, **96.4%** of revenue was generated in the United States[116](index=116&type=chunk)[117](index=117&type=chunk)[126](index=126&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=26&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management attributes strong Q3 2023 revenue growth to market expansion and utilization, with improved gross margins despite rising operating expenses, while addressing a potential European supply issue and maintaining strong liquidity [Overview](index=26&type=section&id=Overview) - The company is focused on its proprietary Inspire system, an FDA-approved neurostimulation technology for treating moderate to severe Obstructive Sleep Apnea (OSA)[122](index=122&type=chunk) - As of November 7, 2023, the company has secured positive coverage policies from commercial payors covering approximately **260 million** lives in the U.S., in addition to Medicare coverage[124](index=124&type=chunk) - A supply issue with polyurethane-based stimulation leads in Europe, pending EU MDR certification for new silicone-based leads, may cause implant delays and reduce European revenue by up to **$4 million** in Q4 2023[127](index=127&type=chunk) - The company expanded its commercial presence, ending Q3 2023 with **274** U.S. sales territories and **1,107** U.S. medical centers implanting Inspire therapy[135](index=135&type=chunk) [Results of Operations](index=32&type=section&id=Results%20of%20Operations) - Q3 2023 revenue growth of **40.4%** was driven by increased utilization, market penetration in existing territories, and expansion into new territories. U.S. revenue grew **38.8%** while revenue outside the U.S. grew **99.0%**[157](index=157&type=chunk)[158](index=158&type=chunk)[160](index=160&type=chunk)[161](index=161&type=chunk) - Gross margin for Q3 2023 increased to **84.1%** from **81.9%** in Q3 2022, primarily because the prior-year period included a **$2.8 million** charge for inventory obsolescence related to new product introductions[163](index=163&type=chunk) - The **32.3%** increase in SG&A expenses was primarily due to a **$16.3 million** rise in compensation-related costs from increased headcount and a **$7.0 million** increase in marketing expenses for direct-to-consumer initiatives[165](index=165&type=chunk)[166](index=166&type=chunk) Comparison of Results of Operations (in thousands) | Metric | Q3 2023 | Q3 2022 | $ Change | % Change | | :--- | :--- | :--- | :--- | :--- | | Revenue | $153,302 | $109,188 | $44,114 | 40.4% | | Gross Profit | $128,920 | $89,402 | $39,518 | 44.2% | | R&D Expenses | $29,144 | $20,993 | $8,151 | 38.8% | | SG&A Expenses | $113,247 | $85,603 | $27,644 | 32.3% | | Net Loss | $(8,540) | $(16,847) | $8,307 | (49.3)% | [Liquidity and Capital Resources](index=37&type=section&id=Liquidity%20and%20Capital%20Resources) - As of September 30, 2023, the company had **$467.2 million** in cash, cash equivalents, and available-for-sale debt securities[179](index=179&type=chunk) - Working capital increased by **$30.8 million** from year-end 2022 to **$499.6 million**, driven by higher short-term investments and inventories, partially offset by a decrease in cash used to purchase those investments[179](index=179&type=chunk) - The company believes its existing cash, investments, and cash flow from operations will be sufficient to meet its cash needs and fund operations for at least the next 12 months[185](index=185&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=37&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company's primary market risk is interest rate risk associated with its cash equivalents and short-term investments, with a hypothetical 1% increase in rates impacting interest income by approximately **$16.2 million** for the nine months ended September 30, 2023 - The primary market risk is from fluctuating interest rates on cash equivalents and short-term investments. A hypothetical **1%** increase in interest rates would have impacted interest income by approximately **$16.2 million** in the first nine months of 2023[200](index=200&type=chunk) - There have been no material changes to the company's exposure to credit risk, foreign currency risk, or inflation risk since its 2022 year-end report[201](index=201&type=chunk) [Controls and Procedures](index=37&type=section&id=Item%204.%20Controls%20and%20Procedures) Management, including the CEO and CFO, evaluated the company's disclosure controls and procedures and concluded they were effective at a reasonable assurance level as of September 30, 2023, with no material changes in internal control over financial reporting during the third quarter - Based on an evaluation as of the end of the quarter, the CEO and CFO concluded that the company's disclosure controls and procedures were effective[203](index=203&type=chunk)[204](index=204&type=chunk) - No changes occurred during the quarter ended September 30, 2023, that have materially affected, or are reasonably likely to materially affect, the company's internal control over financial reporting[205](index=205&type=chunk) PART II. OTHER INFORMATION [Legal Proceedings](index=38&type=section&id=Item%201.%20Legal%20Proceedings) The company reports that it is not currently a party to any material legal proceedings - The company is not party to any material legal proceedings[207](index=207&type=chunk) [Risk Factors](index=38&type=section&id=Item%201A.%20Risk%20Factors) The company faces risks from delayed regulatory approvals, specifically a current EU supply issue for stimulation leads that may impact Q4 2023 European revenue - A key risk is the potential failure to receive necessary and timely regulatory approvals or certifications for future products and expanded indications, which could adversely affect business growth[208](index=208&type=chunk) - A delay in EU certification for new silicone-based leads has created an inventory shortage of the current polyurethane-based stimulation leads used in the European market[214](index=214&type=chunk)[215](index=215&type=chunk) - This supply issue is expected to cause delays to implant procedures and may adversely affect business in the EU, including a potential reduction in European revenue during Q4 2023 and possibly early 2024[215](index=215&type=chunk) [Unregistered Sales of Equity Securities, Use of Proceeds, and Issuer Purchases of Equity Securities](index=40&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities,%20Use%20of%20Proceeds,%20and%20Issuer%20Purchases%20of%20Equity%20Securities) The company reported no unregistered sales of equity securities, no specific use of proceeds from such sales, and no issuer purchases of equity securities during the period - None[216](index=216&type=chunk) [Defaults Upon Senior Securities](index=40&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) The company reported no defaults upon senior securities - None[217](index=217&type=chunk) [Mine Safety Disclosures](index=40&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is not applicable to the company - Not applicable[218](index=218&type=chunk) [Other Information](index=40&type=section&id=Item%205.%20Other%20Information) During the third quarter of 2023, several company executives and a director adopted Rule 10b5-1 trading arrangements for the future sale of company common stock - In August 2023, several executives and directors, including the CEO Timothy P. Herbert and CFO Richard J. Buchholz, adopted Rule 10b5-1 trading plans for the pre-arranged sale of company stock[219](index=219&type=chunk)[222](index=222&type=chunk)[224](index=224&type=chunk) [Exhibits](index=42&type=section&id=Item%206.%20Exhibits) This section lists the exhibits filed with the Form 10-Q, including certifications by the Principal Executive Officer and Principal Financial Officer, and XBRL data files - The report includes a list of exhibits filed, such as an employment agreement, CEO/CFO certifications (Sections 302 and 906), and Inline XBRL documents[226](index=226&type=chunk)