Inspire(US:INSP)2025-05-05 21:00Financial Data and Key Metrics Changes - The company reported revenue of $201.3 million for Q1 2025, a 23% increase compared to $164 million in Q1 2024 [10][17] - Net income for the quarter was $3 million, translating to diluted net income of $0.10 per share, compared to a net loss of $10 million or a loss of $0.34 per share in the same period last year [10][19] - Adjusted EBITDA was $33.2 million, representing a 16% margin, up from $11.9 million and a 7% margin in Q1 2024 [19] - The company ended the quarter with $414 million in cash and investments, despite a reduction due to $75 million in share repurchases [20] Business Line Data and Key Metrics Changes - The U.S. revenue for the quarter was $193.6 million, a 24% increase from $155.8 million in the prior year [17] - Revenue outside the U.S. was $7.7 million, reflecting a 6% decrease year-over-year, attributed to prior pent-up demand from supply shortages [17] Market Data and Key Metrics Changes - The company is expanding the limited market release of the Inspire V system in the U.S. and is preparing for a full launch [9][10] - The transition to CPT code 64568 has been incorporated into policies covering approximately 80% of the 300 million covered lives, including commercial payers and Medicare [13] Company Strategy and Development Direction - The company aims to drive high-quality patient flow and increase provider capacity through the addition of advanced practice providers and certified surgeons [16] - A focused patient marketing and education program will be initiated to promote the Inspire V system, with an emphasis on digital scheduling tools [14][15] - The company plans to submit for regulatory approval of the Inspire V system in Europe and Asia this year while continuing to provide the Inspire IV system during the review process [13] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the full-year revenue guidance of $940 million to $955 million, representing a 17% to 19% growth year-over-year [10][20] - The second quarter is expected to be a transition quarter with mid to high single-digit sequential revenue growth, followed by a strong second half of 2025 [12][20] - Management noted that the demand for Inspire therapy remains strong, with many patients waiting for the new device [12][39] Other Important Information - The company hosted over 300 physicians in Inspire programs during Q1, including training for new ENT residents and sleep fellows [15] - The Inspire V system incorporates new technical capabilities that will allow for future therapy enhancements, including sleep detection [9] Q&A Session Summary Question: What happened with the Q2 revenue guidance and the destock? - Management indicated that increased awareness of the Inspire V technology led to patient warehousing, affecting Q2 revenue expectations, but they expect to make up for this in Q3 and Q4 [26][27] Question: How confident is the company about Inspire IV inventories in the marketplace? - Management stated they have close knowledge of existing inventories and expect high-volume centers to work through their Inspire IV inventory quickly [32][33] Question: What is the company's confidence in the Inspire V launch regarding manufacturing and reimbursement? - Management expressed confidence in the device's performance and the manufacturing processes, noting that the transition to the new CPT code has been well received [45][48] Question: How does the company plan to onboard generalist ENTs during the full market launch? - The company plans to involve both academic and general practice ENTs in the training programs to ensure a smooth transition to Inspire V [60][61] Question: What is the expected impact of operating expenses on profitability? - Management indicated that they will continue to invest in operating expenses to drive revenue growth, with expectations for revenue to outpace operating expense growth [68] Question: How is the company addressing the lower professional fee associated with the new CPT code? - Management believes that the simplicity of the new procedure will outweigh the lower fee, and they are monitoring physician acceptance closely [72][74]