Inspire Medical Systems (INSP) 7 Feb 232022 Q4 Earnings call transcript

Good afternoon. My name is Josh, and I'll be your conference operator today. At this time, I would like to welcome everyone to the Inspire Medical Systems Fourth Quarter and Full Year 2022 Conference Call. All lines have been placed in mute to prevent any background noise. After the speakers' remarks, there will be a question-and-answer session.

conference President your Inspire. of the Yagci, speaker, hand Vice the Investor now over first to Ezgi I'll Relations at

may conference. begin You the

in Josh, call. you, and you for Thank thank participating all today's

Herbert, President Financial is copy the of XXXX. Chief today, X Joining me XX Earlier on are and Executive our ended Rick Officer. results Officer; financial released release A months the available Chief website. we and press Buchholz, and for XX, Tim December

statements within without this meaning management our market in to operational call business, make forward-looking of COVID-XX All based financial including are On Federal access continued the statements, our and the and Laws. various outlook, our pandemic, limitation, the and estimates Securities investments results will current upon and of relating in full improvements condition, effects financial assumptions. operations, year forward-looking financial those XXXX

undue materially on Please Securities SEC events Commission for Statements to you should involve uncertainties. and results actual our and material or these of place on with filed February risks be a cause XX-K by and differ. report XX with annual the Accordingly, could including our risks filings that reliance these to Form Exchange uncertainties the not description see statements.

events XXXX. speaks information obligation, today, broadcast otherwise. disclaims projections sensitive or future of revise of This X, by or because time except any conference as contains and forward-looking intention Inspire or any laws the or information, February new financial required call as to update only statements, live whether

to Tim is over Tim? it to pleasure my call the that, With turn Herbert.

and call business for everyone thanks and full for you, Thank our joining update the XXXX. quarter year fourth Ezgi,

very finish with to quarter first profitable strong all our progress business. and excited across a to solid are of elements our year report significant We a

our best patient has As Inspire commitment always, and experience that ensure patient possible first foremost outcomes the each to to with reiterate and we therapy.

the patient, demonstrate XXXX can population to access that including planned call, therapy, on benefit ongoing many improvements and accomplishments the technology our will Inspire. focus highlight During broaden from advancements and from we that today's to activities

We XXXX. and over there fiscal year will have Inspire therapy. completed milestones also now discuss our XX,XXX many outlook patients in received important for who XXXX, are We

of and silicone-based we and sensing Bluetooth MRI updates year, enabled digital received launched along body remote. made with Inspire full Inspire our with management compatibility, leads, platform system stimulation significant major FDA our the approval patient SleepSync Sleep patient including and Further, we app. to the progress During the a

care significantly Care pilot a scheduling access patient a to our initiated enhance believe also of through Program. digital Advisor will We which tool, we

important with gives of XXXX. achieved representing of the our In we the profitability quarter, which million, as population In first XX% to the $XXX.X in $XXX million for XXXX. let's review all fourth indication high enter us FDA, we the quarter, including addition, and we submitted in for noted expansions a for syndrome Down previously, patients We confidence Index. raised pediatric we results. time, revenue Hypopnea fourth With to compared as Apnea quarter the of generated increase and over cash, with the a fourth that,

For million, revenue compared the year year a full XXXX, $XXX.X increase of to totaled full XXXX. XX%

and to centers. utilization centers new higher existing growth the by activation supported Our by of driven continues at be

inventory to our levels. have silicone-based production challenges These the products experienced as we the During increasing the stimulation our due for supply and demand provide fourth resolved issues and sensing ability quarter, challenges we scaling to with our chain outpaced and the are with been leads bites.

high to the year. of plans reset the first were quarter the all we Despite start product seasonality of in deductible the in procedures providing these we scheduled have experienced challenges, successful fourth at Historically, due health for quarter. the in

supply chain the see may While quarter to fourth the first the quarter. slightly seasonality case, issues this XXXX in of the due remains less

compared we million In $XXX XX% year to the XX% that the quarter, end $XXX centers At centers, adding million XX XX new With a increase we continue quarter. the be planning said, and with up the total fourth XX of to to centers continue of U.S. revenue year to surgical of range XXX the XXXX. increase capacity ending by ambulatory in to in full of in to to centers, we expect our expect centers. fourth to XX% per XXXX, made of quarter, activate

territories we the XXX team, to quarter, sales territories. fourth Regarding our XX created the total bringing in U.S. sales new

XX optimize our will to our In increasing continue outcomes center training are per per to compared scale to ongoing and sales on sales XX teams XXXX quarter to We in quarter guidance in and our to patient expansion to and strong to productivity. XX focus territories XX XXXX. we add expect and management XXXX,

As such, our existing for at your utilization the centers. field on modified how to we incentive compensation organization focus

We will qualified interested continue to provider. to healthcare a our enhance ability patients connect with

through very primarily inspiresleep.com are website. generating in interest programs the Inspire in effective Our outreach therapy,

For office, include of an healthcare represent the full visitors these provider. million, over And these physician directly and Advisor calls the we our a emails patient's of from year-over-year. to website visits, XX Program XXXX, surpassed XX,XXX directly year number and to from had contacts. physician contacts of or to do XX% note, the a referrals our not Care physician's increase Of

in for From XXXX reimbursement November rules were in outlook providers. reimbursement providing final healthcare came and published a expected, as generally stable the for perspective, U.S. a

business year the continues prior our fourth exchange growing over year, strides, headwinds quarter make international despite XX% the to unfavorable the in prior ongoing from over on, Moving rates.

Germany, the market. global are international business U.S. in positives including our less was the in many quarter There quarter, during than the fourth the the strong significant performance the of During international highlighting X% and Switzerland. revenue, in growth Netherlands revenue

the registry the listed many preparations XXXX team the authorities, process French consistent the rest years the following to for the have of our the and there. world, reimbursement in launch rates early For with Inspire final continues more, of French we on in are at working with commercial

levels programs flagship productivity continue at consistent In perform centers. U.S. with Singapore, to our

see cases quarter. completed And should and additional we in in in in doing that our multiple Hong complete determination also first Kong, with reimbursement have momentum We [indiscernible] booked quarter Australia, we procedures February. have procedures submitted later for year. expect first a have read in or the fourth first Japan, centers the to also In this

Turning remote to on R&D, term, FDA our for our a with fifth Inspire programmer physician Health we SleepSync is Digital generation platform, which SleepSync for continue programming. neurostimulator. review. we to recently new step Longer of the submitted connects providing patient key design our programmer work next This generation

the to measure respiration. the an pressure accelerometer eliminate device neurostimulator using Inspire will and The X inside the incorporate sensing need sensor

we We qualification. and have the and conducting design production finalized operational are

into We XXXX. are late cycle, depending upon XXXX, still the targeting FDA and FDA review could approval move FDA this in early but

XXX continue first XXXX. step initial to apnea continue finished fourth study, we the BMI in first office clinical enrolling drug and patients to with of data for the In replacing quarter, of to sleep who which clap in the can Finally, therapy. to our with less increase measurement the of for number a for induced research procedure Inspire PREDICTOR we trials is the based benefit than readout the requirement an conduct patients patients from XX and

increase XXXX experiencing focused continue existing to patient business. we're adoption beyond, utilization significant We physician to on at education and summary, outcomes therapy. and momentum remain the we all financial of In of opening will aspects our our In continue new improved in these our and our are investment these The our capacity call we're which driving and adding and centers, while DTC from seeing training support center ongoing enhanced by efforts, performance. in centers. expansion campaign of initiatives, our productivity

excited commitment to the and our Finally, confident prospects the many value. our and extremely R&D providers we health improving Inspire strategy the highlight We to future are enhancing therapy. that patient achievements both experience remain and stakeholder long-term outcomes to in in drive XXXX within place have appropriate care about patients

over call like our that, to review for his of With financials. I'd to Rick turn the

$XX.X Tim, new the good a centers of increase direct afternoon the in managers. $XXX.X quarter XX% the several quarter territory to the reflects U.S. revenue number higher million higher and and generated existing in was marketing fourth the million, you, consumer quarter in increase of the fourth everyone. fourth was XXXX. utilization Total year XX% an $XXX.X and the million, in prior Thank growth $XX.X implanting from period. factors of centers, a expanded including of addition revenue from million The U.S. the for

the U.S. units the increased The that year-over-year in increase which to the outside $X.X outside sold was XX% XX,XXX May in in prior quarter compared is XXXX. year-over-year. Revenue period. XX,XXX, while grew our fourth a began XX% average uplift price basis, of reflects price year increase million, a selling U.S. reported The U.S. to the on

level. current to steady ASP remain the U.S. expect We at

fourth in the fourth XX,XXX The during ASP sales ASP and compared which for exchange compared unfavorable in costs second quarter, quarter prior driven XXXX, lower partially leads to the in to certain was higher by in outside by transition and price due with the period, was increase U.S. rates year that Asia. to additional in silicone costs the associated based of was primarily parts Gross margin XX.X% a distributor XX,XXX quarter the our component quarter. began offset to of new XX.X% the the the

the planned sales the to compared as of for $XX.X our increase increase fourth quarter This to expenses due is quarter million, and expenses of efforts continued was in business. reflective operating increased general in $XXX.X XX% XXXX. continued of areas our to were Total ongoing corporate million fourth our programs, of operating costs. drive expansion an The key marketing of to direct-to-consumer growth in development long-term increase product make investments and organization, plan

the quarter Interest higher rates period. quarter and million off balances. outstanding driven in in our debt fourth quarter no the income in expense the third had was fourth the dividend our have of XX,XXX totaled interest year higher by cash We increased XXXX. interest compared paid income to on $X.X in you prior This

in million, We to income quarter our history fourth million $X.X loss proud was in period. a year Inspire. and announce the quarter profitable $X.X for first the are prior net compared to Net

net of diluted to was fourth in share of the quarter net per XXXX. quarter compared the per share $X.XX The loss income $X.XX, the for fourth

fourth number outstanding the for average million. We have shares $XX.X of was quarter diluted

weighted shares We average outstanding $XX.X expect be to approximately million. QX

volumes During quarter, strong at cash centers. increasing growth while position and $XX cash allows in procedure to investments focused and our million. on totaling The existing we training with cash of XXX the implanting strategy opening new generated centers, million ended fourth and the we remain executing us year

Net loss to compared XXXX per a $XX.X million million in currency full for prior the $XX increase headwinds. with despite year U.S. revenue full XX% the or U.S. million, or million. a revenue year-over-year the while X% outside revenue XXXX, growth, $XXX.X growth million in year-over-year million, $X.XX share $X.XX loss XXXX $XXX.X $XXX.X XXXX, year. for a to a totaled compared For foreign year net totaled XX% $XX of was over totaled the

to gross range on guidance, expected XXX range to a Moving year of XX% is in be increase compared the in the to margin of full million expect be Full XXXX to XXX we to to million, revenue XX%. XX% to XX% year XXXX.

As territories per quarter sales Tim XX to we XX XX noted, quarter in expect to activate and to new establish centers new per XX previously XXXX.

plans, in Given of high seen the business. prevalence health we our seasonality have historically deductible

As and outlook Tim XXXX, in of mentioned, as increase provide to previously in enter year. our to quarter the step revenue expect confidence down XXXX. momentum continue conclusion, with performance and throughout we will our sequentially business strong then In we the us first

prepared you now open our remarks that, With for questions. the Josh, line may concluded. are

first Travis question comes Our Bank Steed of from Instructions] [Operator with America.

proceed. may You

the this past you profitability to quarter. said, profitable. I stay And the profitable, in wanted turn think on you you Congrats once

know to is Should year. flat next The this slightly of Street the in over looking because closer that for at loss if start I to that $X So, be positive? earnings don't has

comment, and kind let Hi, me Travis, in. first, jumped of Rick

know, think know get standpoint. from your a we as is I important we wanted We profitability. to it business how

be organization, moving a do in will but we that know the see think, forward, it's, also I to seasonality there. continue QX, of we it desire

hand me let there. off Rick to So,

Yes.

a changing to our just show We're profitability. approach continue have of that demonstrate revenue spending would our to but some We're we our So, tone we disciplined as due But investments in our leverage normal run some our understand lose very important our QX to and not do across in improving expect determining progress throughout leverage to operating that playbook, do it business. we in we year. is we leverage the improved seasonality. going to also we did intend QX, and

there also with is the the move in the it if range, that something And curious for for you the change the I good on you point? early know And year? so so kind caveat? expected hold starting the OpEx, upside of maybe XX% if would mentioned, follow-up revenue if in driven OpEx X, I more comment, that a just on grow Inspire higher if of or that you than of other would outside year, revenues don't I'm And XXXX. that if drove into think, a course come or then something was comment a or was was of

I'll start Travis.

as we're expenses line, we did not the on operating So time. quarter, which expenses. means at this did demonstrate fourth you also guide revenue the bottom In know, that operating going to outpace

And so, we're driving thoughtful make going continue that discipline really we're on but top to to line. investments focused

testing, the and I the the through are going building with design continue program, the as X, units, we're building is we quality As frozen, think Inspire far operational redundancies. the we we're up

supply chain. have manufacturers that multiple product, We for to protect for again,

to the and to be we're to see by end right a early get can little bit is tight. pushing hard of approval 'XX the schedule then, get really So 'XX, the going always get challenge but submission all if cycle the though, to done it work we the testing but still a the of into

Thank you.

next with from JPMorgan. question Our Robbie comes Marcus

You may proceed.

a coming year. the you're growth with Maybe off really guide, starting good

of center the rate healthy still looks XXXX. guidance, utilization implied growth XXXX. flat it But for like of really be Your in guide a by terms might decline a math, pretty growth, 'XX. in kind in to And is rate for down my significant versus

the about here as the other should start conservatism anything we implied than So year? in be usual your we that thinking guidance,

additional team. continue very utilization be for put there point actually we or in at we business the to at how beginning guidance how in the We the we want year. the note that improve, of our on to the want at putting the utilization to there fact in to sales consistent out Yes, mentioned look of drive existing already we incentives centers,

has putting yes, the Company's in all across the of be we board with to and on, been like we want So again, early really careful that position guys to milestones. our strong

not think constant from international Thanks. international material then And it How about number a the impressive. looks starting currency today, part And huge was step to become big should a a sales of this quarter XXXX? the up throughout fourth be third contributor? we like. growth while really quarter, And of can in a cadence

very much, Robbie. you Thank

the within about we're excited getting on before we're, a we listed think we manager registry know an just French will it's is a in away good that fully going authorities international accepted I as recruiting the be we're and very to there's days reimbursed confirmation have France from year. product And France. country

kids and will and well that in Netherlands of to the have UK year as top started the that strong think We even Belgium set is a as has XXXX Germany follow doing too. up on

little a be in uptick Europe So, starting few just first side, what's happening we doing and like weeks. Hong bit. to Japan case a in really is Kong other the will Singapore, And the

international far success measured global United a the foot really be to to hovering States, to as going still on utilization want as with not was to continue and it's X% grow the around it's well. going the our we're off on take think pedal as mark the I keeping market we U.S. So the and focus revenue, growth in

I be So, our you'll U.S. to internationally, the market. emphasis think continues see on growth while continued

Thank you.

Sandler. Maeder comes Piper next with Adam Our question from

proceed. may You

'XX OpEx. spend spend and wanted to us realize could investors just just of in, where term start expense about guidance to direction and XXXX then go? remind in just direct-to-consumer of Maybe there's But how longer should ask and no where this came on about think kind to kind DTC

Adam, Rick. hey, So, it's

talked contacts. pipeline. our XX,XXX visits our continue to make very to about because and So, website, DTC We in investments physician million over XX important we for

our And a important so very part it's of business.

by In XX the million. where was over XX but continue 'XX, That's XX%, XX up in our that we to fourth flat to million. going quarter, about quarter, And that. increase third relatively in over million DTC was Year-over-year XXXX. we're we spend the spent 'XX, spent

that guidance not investments we're to But investments our continue slow. grow that in be now. might than specific make XX%. be given going There'll to what less those growth DTC, right We're what and around will but

just for follow-up. then the And

guidance I'm curious, physicians how And on give to do per You and forward? are there? a guys able on share product. you those clearly There's there Are in planning share color of helpful color account can for if ads. some about metrics your new you think account. going trends you demand lot

account not growing think centers? but of you how wondering, the also So number importance the just about of the that docks, base, existing

to continues the and increase is an you, capacity of center Great Adam. one thank be fastest able from a existing a focus be to to ways add hear surgeon. you. It to at it's Absolutely, to

on so time surgeons. key methods have to continue we partners But we'll grab also And is existing the to that train it to able of specific to for we with work one metrics have a art because with to here, additional be centers their don't certainly is the focus either know just demand time or but the there. additional

So, and specifics to be more that, in to capacity. but it some team forward a certainly we'll look key grow our is for try continue find able field to to on factor

you. Thank

with Truist. Our next question from Rich comes Newitter

You proceed. may

Thanks the the quarter the of the XX% like decline last into XQ. might you that few the think, be little XQ. sounds on about to supply see, years, congrats Typically, I than finish to wanted XQ out a It issues really bit just to a suggesting percentage or normal. off the deferral called you're maybe XQ and maybe and of I some less seasonality low-teens impact you another for on in kind taking on solid comments year. XQ the great questions of start context

a or to think or think sequential push what demand is you Could correct XX% that out quantify good is about than that supply decline historical out less way the might been? it? of less have push procedure, So, A that you

Yes.

we're first. little Let's go talk what a about about back talking and bit

up think, we're as we've in production line. kind the But silicone we're always we the stimulation of talking remember, did when we the up third safety I back First, get we the is -- to built And leads, with And to polyurethane these of line to stop we we had scaling ran volume. XX%, purge stock then line get polyurethane, about We like some seasonality to them talked the and moved quarter then up process be from production the into when a running. to and but challenges. about QX. when of and to that, able have transitioned we we

So, schedule the all some those January. we to holding in support to able ship things sure went to like in orders and time track ready closely go. to with time more to fulfill, cases we of for powers, that of scheduled just just and that of had may procedures cases products But a in part we level and be would were those of some system, January part in delivery or make get that. And

but But are wanted to So, is in still a everybody that are exists, inventories that. bit, but challenges, the to scaling with that probably the to the might number, little good not but big production lines and news of awareness it that the seasonality growing bring up. just aware a supply certainly the make the offset chain

helpful, Okay, got it. that's

it minor. sounds pretty So,

under good account then centers I the probably just it. in right you're think to And centers. think a is a I on about opportunity, X,XXX right now Your planting seasonality normal way think,

know could accounts high the in order very magnitude see base and just you've said talked past of You've refresh of something a also opportunity get. tune there's in the kind And out U.S. but to I think you how the that theoretically think towards right X,XXX it's is memory our there. X,XXX you about, I level, that the Can installed progressing opportunity? what account ASCs account on maybe some X,XXX you I

Yes, good question.

a X,XXX we spending I in our third been X,XXX. at we've a assumed larger Inspire communities, So and then recognizing when X,XXX more time don't of physicians over have be evaluating drives about of X,XXX up think to would capability market more a got patients and doing are into because we last we've that and target centers long take that just that of put the couple took yes, would those or city centers that, to centers. And been the setting quarters, total smaller require

we're to to think going continue that. So, evaluate I

well, that the to Montana, will I can think doctors there we've to number that community-based some the accounts really towns to that far Idaho, And very we are have and community able in already we can X,XXX. of Wyoming, in communities, be more care. offer the smaller Jackson, and these centers demonstrated Inspire exceed productive move in leverage even in

Inspire. story So continues increase we of continue evolve, of to to I and patients will centers number that think capable the treating with

you. Thank

comes Biegelsen from with Our next Wells question Larry Fargo.

proceed. You may

wanted ask down the guidance you you're and BMI on guidance? changes. label assuming what assuming and and I AHI, to do timing Tim, to indications the for that new the in the impact any

pediatric we're think very population with optimistic syndrome. with I the Down

they I think questions answer FDA been with data. that to working that closely the the on audit come and done clinical they've have, we've

we progressing review well. they're that So, know as under

happen which And optimistic think really that that exciting. the is first I year, so in half of the we're should

that longer proper that the to stage, certainly again, and also have be review we're that's I coming with bit it at bit able but earlier the that FDA the As to little the to the little designation FDA. approval, far AHI BMI, confident through. And does the is so a working as a get high will accelerate for take progressing, warrants and think that help

expect the should on we near and So, those in have business. both the future impact of

into to try forward. of we build So put kind guide that the that we did

slow a get out to as populations, in I to incorporate little that there awareness the be both practices. be able we into and a of existing those think the, uptick of it'll bit

of pediatric institutions children's lot of are larger the the is today. hospitals with affiliated news some good the hospitals or The that inspire already a do

Inspire present. an we have So already

and to hopefully, pediatric streamline front. that will So up the those get centers on ability running our

population dear that we're that. that very and heart, be awareness with near work build to the will able to parents and societies in on our excited and come to to family about in the of that's groups more So of

Why do will. think there? community, Just follow-up the you organized low on pediatric They're relatively well or if will uptake you one be well Down.

the pretty pretty, need think here. clinical seems I high

working a been this You've on while. for

So taking Thanks why to slow? the for be population that do questions. you in uptake the expect

we think working for on and you've Inspire and the will I number be of pediatric seen have relatively seen that it studies and still patients it's group. those enrollment a we in small studies years, clinical

a it's to therapy, and families and think doctors new I a new option for to the able understand. the be

any just and think to is therapy going country. like bit There's little become I comfortable like the slow So, prescription indication learn always into be new any of an just to or this of it people the therapy. increase in adoption as curve a process any about with educational introducing new a and new or therapy Inspire

you. Thank

Our next question comes from John Block with Stifel.

proceed. You may

And just cash thoughts I Maybe just don't provide I so on so, thoughts Maybe have the would believe the positive around for guys your 'XX. be flow I'm XX first million would million? full year maybe with EBITDA or look for trend review, year full how statement, talking XX quarter, [indiscernible] on just 'XX? if your that around in you

Yes.

was XX compensation million. about stock-based So,

So John, million in terms, quarter. we're roughly for in EBITDA rough the XX fourth about positive

sales marketing, and that Again, compensation along so make expense facets on. that and business will also investments R&D, continue to We're stock increased. of has increase. going so based our our to And all

first OpEx the leverage seasonality providing gain that, But the with with back we'll that, we or guidance year. but then not that again, bottom-line we're progress in we on any our so at And this quarter expect throughout time. as lose

maybe I follow-up that. No, a as I got But it. just to guess

you 'XX, for which just over conclusions draw expect can fair or positive We full just EBITDA sort 'XX. a course XQ, from there. but you our that Is not the of you're statement? confirmed, If leverage, and year own of

That's fair.

just a to don't talk little us, you if the want Tim, bit. then, And ASCs you on

playing see is the And think as do came importantly, this a evolving again representative over procedures? how I more maybe time. it you overall out percent in and XX%, that of

us you've act reimbursements an you initially, think help longer settings, utilization potentially commercial for excited talk improved number term? can as I were those got utilization good to for the being there, percentage to about how that or a Inspire payers, driver overall higher and

to think more think are really be the I of again. post-COVID phenomena I where this And was maybe about. it active continue little excited a bit hospitals

we're growing of not still growing we're utilization I right well ASCs. while procedures running that that's seeing I number hospitals a we're the ASCs But think, impact done of the maybe number too of And so part we're XX%, at now factor and do surprising. is we're as ASC. the is still the in are think our of XX% as

though make means that ASC centers, procedure. share is fair what of more up the of the Even their XX% of taking they're

good ASCs. see both, utilization really that's So, to the in growing but particularly in

hospitals utilization strong, continues service. board. the continues As garner know, by the take to time is we in ability evidenced very, patient very we and to to across the all care continue to And of But that progress, our be sites increased I think we'll continue reimbursement further to of look to as our grow. for the

all the Inspire hospitals as as well. that with not we're our to his continue focus leverage participate to want we taking but So off

Thank you.

from question Wolfe Michael next Polark comes with Our Research.

You may proceed.

incentive for your change framework level is a this I the compensation you change? What on does to utilization XXXX? the Is what I did before as that, topic, change? like like for higher First make field and comments existing now, force it why subtle focus it a this guess modifying guess, look on notable centers. can look

structure. of important a off, same territory the for first field the the the but in it's especially managers, the well, and Absolutely, compensation shares part compensation management team

consistent. all So they're very

people. groups of different have We

centers, are and on existing We new focus have increase know, area managers, the to opening responsible centers business the territory for as that you cultivating managers the utilization.

unit based everybody in more patients we commissions comp, patients expecting are the we we and years, and revenue past, more based components, implants course around to been call prior get sold, their used but the on base added compensate what authorization of the on therapy In in past gets they process. have -- and the it's

it's more mature, patient that to from at we continue as important But shift site. to we individual utilization count that

So, this over switched utilization we've the really focus parameter to more of the starting on year kind site.

So a is excited as week I just presented last national and very at the prospects sales ago, team moving about well meeting forward. the we think, year, as progress it that just they made the

My related leverage question. second may one, if I

versus leveraged in model? kind S&M? or line. frame Just that You materially Thank how better variance trending filings so getting seeing a up you as about that the is consolidated don't and Is like, much. S&M the just of there a a versus the a leverage your Or getting as see spend report I'm to like where G&A you're Any you total, would there in assessed portion great. S&M? curious in I breakout a versus out SG&A of worth G&A. be, as if G&A they is same? of are is could you color calling

Hey Rick. Mike, it's

forward. the those going with across demonstrated But have lose continuing QX R&D, year we're marketing, leverage we So, and to G&A, make in even items, line seasonality. the quarter XXXX. over R&D, continue and to in of investments. -- Again, fourth that sales in we're as that to G&A all in the the third in and that throughout fourth in revenue in ballpark, to XX% That we quarter. R&D quarter. the range. going And range XX% expect XX% that to was in was is be XX%

So cross line you. on all

you. Thank

comes Our Pasquale Chris question with Nephron next from Research.

proceed. may You

question incentive in up follow the shift the about on to want I comp.

about many as 'XX year this you sites in we did for guidance implies 'XX. as in the add So

that Maybe team like where you reading it your ads incentivizing square that but that with this center you're to how year. fewer too spend see to into time. could comment, much their mean like seems we're wanted Just

we be to still on focus Well, 'XX, to have the area 'XX consistent we're continue guys adding centers. left I because team the And our able of managers new business to think, that. and going from training to we with

We also going versus of driven previously kind store centers. new what And by about predominantly we're growth pathway. has the -- really continue same talked how our the that think, from I highlighting to increased contribution we're utilization, sales down been is

procedure the more better on because They're do that we are to patient want they're proficient focusing reimbursement. the in procedures, get the at utilization, keep submitting and growing patients, on proper flow, And proper better able they can to better more at centers they're codes managing outcomes. to proficient

have much outcomes. and more patient just higher so that high centers efficient So utilization are have

So utilization. centers are less ideally we're trend doing continue with managers, to going having higher territory that managed that continue and

that very Okay, bit part patients DTC then fall stumbling sense. it And the about out treated today of more mentioned? a you five Where that of can the yield? are improve are so that talk physician digital out who that for tool the our last people patients of contacts blocks whether every And implant. XX,XXX, is And effort, an little year, about are by causing driven to trying scheduling makes that's you funnel? their actually solution one getting hand, raise you impressive, XX,XXX to

talk sentence about want talks providers. you health not in There's physician direct to part care Well, another getting their contacts. number. That's own about patients of referrals there that from that

from, Care and come five how ad, exactly on there'll Advisor the where see website, in a so, bit truly but patients And educated. to always go one be they'll of many is the patients it the Program, from the there's specificity little

But going will through physician do for their physician, Advisor and or think sleep you coming will own this a than that spiral the from Program. and work saying, actually their will through provider they about referral, rather what the Advisor Program, not me, own become Care the they Care contact direct healthcare

part So important that's really the an business of well. as

continue the to to physician. have we So educate

Advisor we of to Program. the continue right physician's efficiency do need the a other be scheduling directly to log On we at able the to in pilot office. out And side, to improve there the now Care to have

determines candidate they So, when patient me, that in. schedule a can Program, they're excuse a good Care that talks directly potential Advisor the to

and So have up And of handful a looking the earlier in program to we expand face active. we're really that year. further

Thank you.

Matthew question Our from KeyBanc. comes next with Mishan

proceed. may You

think But it I implants? actually this approved will little bit it be think Do investors to be gets I closer, encouraged like to improvements So, might some might where it the you start gets are wait the for as early that X delay, a once through think ask, with about approval. physicians some Inspire

Great question. so. I don't think

standard like can, titration. once in slowdown So to X, while patient a going as Inspire now the have the back with adults puts Inspire we don't and we going that's X that But X, just patient the to Bluetooth a X new a could XXXX. inside generations dramatic with go silicone XX schedule it going past see a when remote we the from see we pathway. this adults with leads have something it in flow or Inspire the such with was doesn't impact into with future tact

any strong. we to expect demand that be slowdown don't we and continues to So, kind of know see

on some PREDICTOR And another an then that for you mentioned was be showed? readout this And study? encouraging readout for with that think XXXX, Can year that follow-up you published comment a earlier initial there would PREDICTOR? just presentation what the that why I industry in study data from

Absolutely.

get finished his in a we 'XX. paper ago Weiner now now, in we're weeks the from stage, getting out, Arizona into published meaning for XXX several that same in firstXXX control. of give the Dr. time, the him a we was quality the the with data it's first And Right patients. physician the So physician shout first because data At overreach quality is XXX.

we're So, we there XX. higher noted also a patients in BMI but that above were process, with right

continue to are that opportunity go actually patients able another XXX study increase treat add and to the to entertaining maybe number we with that. the patients to So can we widen XXX of that being actually

treat control BMI patients, be first higher a on able enrolling like we to the that looking into the what population. the just quality to in continue think we'd is very we're even So we're we active because of getting And process might and see XXX. we program, data

to XXX expect going to expect us in. you'll no, say So patients to we're

comes from next Oppenheimer. you. question [Operator Suraj Our Kalia with Thank Instructions]

You proceed. may

the specifically me, So, the they metrics full store, I If did the same for provided. maybe I year? Tim, ask implants last store do could year? so forgive missed many How added sites new or XXX

of is new And opened has a have anybody We how site remember front during sites. we numbers who specific don't those, up do that but new in the year.

So obviously they were able first any site that we opened in their only to cases. the quarter, do fourth

November, cases they do December. So, or one two in

up to the who to they in have opportunity X year. additional is right And of still the bucket reorder do of the patients Anybody new XXXX opened center. a January and same

XXXX. of get they the those some can the time So, productive by be of end accounts to

So, kind and case we per of established year. that centers, the it's we established way them

don't exact class really the have from yes, the So, cases number the were XXXX. of I of what percent of

do account How turnover? you define

A have hospital define unit, call can accounts se. what different That's let's a a borders per several and account be center account us. we product a is would right. First, That from that center. purchasing

So, there don't up on down may back be to the We catch have on who's center website, one website. right. a

on be The We could have website planning on could practices website. right. along there, surgeon with the sleep centers the multiple

So but are of on don't turnover, But go whole sometimes, go turnover, lot we hold have units. they'll surgeon if those center ahead. a purchasing the moves,

Tim, I trying get guess really what getting I just to was arms around. my at

the You'll XXX you implants. in mentioned 'XX. have I really bled was, onboarding that for out FY some then the that on know, XXXX, XXX have number, Great, past, exiting didn't reasons calls and but sites pick does imply do don't various they a

and them and kick exit You'll the out it at all XXX. then you'll that, list

so what the to is? many So to come don't understand of just How turnover speak? trying kind

really the very, any I closed Very don't we in quarter think very sites. and low, low, fourth

sites like the process. see those time active we centers. And XX. sites a COVID, way, think move number you I our the what we So in back-end once we every is surgeon By have of during reported, and is additive back closed and XXX of some closed XX

able too we utilization. very, become now increase work of patients we site the have turnover very active they're independent center them website. with the of site from late, if Doesn't we'll of are once mean that But to be website remove to two a not that have productive a an to active, want or So, a if they backlog and they too to low much continue they're site functions. out scheduling

for conference. for now like This closing concludes Thank back to any I'd you. the call the to the Q&A remarks. Tim session turn

and call Josh, the joining for Thank you, today. thanks for all

and motivation the of patient As remains unmatched is and most employees always, patient outcomes. achieve their enthusiasm, team to work, our continued for I'm to and dedicated Inspire element successful important grateful Inspire to success. hard The to the commitment growing team's consistent

of employees we I well our Asia. expanding as as our Europe, further and the focused for U.S., wish teams continued healthcare business their to remain in on in efforts, all as the thank

ahead. and updates look on call, appreciate Inspire the providing supportive we All of with forward your to you and continued month you the interest further in

and healthy. stay Please safe

today's This you. concludes call. Thank conference

now may You disconnect.