Inspire Medical Systems (INSP) 6 Aug 242024 Q2 Earnings call transcript

Good afternoon. My name is Dilem, and I'll be your conference operator today. At this time, I'd like to welcome everyone to the Inspire Medical Systems Second Quarter 2024 Conference Call. [Operator Instructions] I'll now hand the call over to your first speaker, Ezgi Yagci, the Vice President of Investor Relations at Inspire.

You may begin the conference.

Dilem. you, Thank all you in call. today's And for thank participating

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

relating financial forward-looking On upon various assumptions. the and federal of and this the statements, without in full within including, meaning our call, operations, are and estimates management and year statements will in to limitation, investments financial XXXX based those laws. market current access results operational make All our changes forward-looking business, our securities outlook financial

or undue XX-Q, any or materially contains or not filed Securities speaks events live you SEC because should and as to as involve law, of these projections by required conference with This today, future Inspire on broadcast update our and X, including except obligation, reliance intention Accordingly, our to Form which a any description information, events that statements These risks new results forward-looking and differ. uncertainties. August place statements or of or time-sensitive financial whether material statements. the information otherwise. call Exchange revise risks only disclaims of Commission, the uncertainties earlier XXXX. filings for we Please these and this see afternoon, the actual could with cause

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

call and outcomes. to We always for patient joining by business earnings call XXXX. second thanks, the quarter for everyone, you, our commitment consistent of delivering reiterating our and our Ezgi, Thank strong start update

our now XX,XXX patient Inspire mission results. first, treated the review With date. and put with Our that, have let's to over we therapy to patients is

quarter, the compared second XXXX. representing we XX% quarter $XXX.X million, second of generated to a the revenue of In increase

reflects period new expansion well a revenue last market Second in implanted XX XXX increase as as territories. new a have and active U.S. centers result same of XX the United the now increased million, over growth territories. sales in year. We U.S. sales as greater quarter U.S. into therapy revenue This penetration XX% centers X,XXX centers and States totaled adoption existing $XXX.X

of confidence increased million. Switzerland, to our increasing the continue the in XXXX represents to as revenue remainder was over for of the XX% million. million, guidance Outside period, of net revenue this of to U.S., second saw us $XX in $XXX the XX% adoption million income quarter XXXX the quarter for $XXX outlook $XXX strength $X.X $X.X and XXXX. revenue authorizations are We loss million With the compared of our per to start share a to which income Inspire Netherlands and million, prior allowed to we Germany, $X.XX strong a net $X.XX the therapy. net derogation loss growth representing of Belgium, year, to to second in of the compared the Net year XX% of in grow

guidance income have $X.XX Given We we the year. $X.XX updates. to are per important highlight very full to net strong like raising performance we for year-to-date, diluted share some the business seen to would

are This and announce includes MDR stringent Europe, we regulatory MRI our milestone certification are body review of approval full very EU a to we achievement. this very and in compliance, requires compatibility. team significant quality for proud and First, excited which a as is operations,

and updated X product to patient derogation remote, therapy this several the and As of countries continuity. ensure certification, neurostimulation a now Inspire may European Bluetooth for help reminder, programmer patient physician we approval obtained we EU access MDR the in With submit to system. the

the in received reimbursement second countries. is other with in France levels Europe. consistent we European market at France countrywide largest Second, OSA

and place, X to a cases. in hard already approval system. accomplishment start neurostimulation just reimbursed proud Inspire significant FDA week, This is we team are we incredibly evaluation organization. many across for the And we work of highlighting the the local Inspire are received and of development and is last ready Our years

on and IPG, sensitivity. eliminate inventory component focused the X need a on are operational to We to and launch readiness system and neurostimulation sensing the XXXX. patient X to the a capabilities will respiratory support surgical to Inspire company with position reduced provide full complexity. reduced sufficient production 'XX into with fewer May building launch costs implant times This the soft to pressure the with and benefits in The incorporates the

Turning now access. to market

progress We make and predictor analysis. study the with good to continue

lateral As study require a predictor or not with who for not patients lower reminder, the wall the the significant may collapse, have endoscopy may sleep DICE. initial is drug-induced focus therefore, a BMI with

to fall. publication this continue towards expect move and to analysis review We the of manuscript a the submission peer

the discussed We already policies DICE have remove and had the several payers their results to have payers requirement. update with

improve $XXX. calls the increase to reduction increase, to National a for a Medicare $XX,XXX a our bringing further continue bringing position patient's payment rates, Inspire front, outpatient therapy. will and X% market outpatient Their on with to a physician schedule pleased rate call Medicare the rate fee obtaining fee proposed to other payers the in which X% with XXXX for discussions are Staying the We roughly proposed access the $XX,XXX. of ASC hospital experience XXXX we for X%

rule reflect rate. However, we a overall reimbursement to would expect physician higher the final

this see clinics awareness primary advance Inspire drive focus continue increase medical to our hosted development to strong our we training and patient to to continue the to The With XXX both continue care initiative presence providers ENT therapy. improve have meet for conferences we we year-to-date, advanced over cardiology therapy. respect in we of programs to Further, is demand Inspire Inspire our market in and and practice and capacity to primary sleep increased education of activities, programs.

compared our year's period patient health proper the contributed providers. and increase to lower connect digital our quarter, to the remains direct-to-consumer strong a significant found with a ways In modestly pathway prior has a we patients targeted more care program cost. second for Our the engagement digital advertising, declined as in to at in which be spend and provides efficient to direct-to-consumer

to We to to digital example first schedule the using continue to appointments. over in Inspire one to With the digital greatly their XX% have book journey a improving scheduling patient experience. XXX we And on observed centers we is improve therapy. increase attempt, patient's patient's advance initiatives ability a now an receive appointment scheduling, have

the further to and reduce reinforces qualify may for and weight our recently for data the to released will market complementary a mechanism therapy. data their Inspire patients be opportunity trial. Switching to SURMOUNT-OSA from GLP-Xs view that The our provide

As predicted to This confirmed to you collapse. of BMI nerve Patients ladder treat therapy was with and which more likely stimulates know, airway, hypoglossal the Inspire is higher our nerve class effectively wall further discussed are experience the not above. stimulation. with results treated is hypoglossal a designed as with tongue-based

Inspire. would use refer experienced in Based benefit our reduction loss the on allow those of the their GLP-X lateral from use the likely of third-party deck who cup, patients on to SURMOUNT-OSA a investor wall Inspire GLP-Xs updated are concurrent to of them Please therapy. to results significant qualify and data for which trial, weight for many a believe including who we experience

actively X,XXX therapy. therapy, to report, on past GLP-X the X over in years the According patients while received Inspire

which and great we expect made we strides beyond. into profitability, to in Finally, continue XXXX have

including sheet, our outlook, a and as $XXX Given shares strong today, our long-term a The balance strong Inspire investment of program company's authorization, of and history. volatility. repurchase financial the return first our we stock supporting believe performance to approval announced we way we opportunity, represent flexible provides our when in such, shareholders, the Board's see share to stock million a with us unwarranted value

focused patients to growth continue Inspire In summary, therapy. and adoption the of we the remain on

execute provider and increasing We capacity to our strategy will of quality more driving treat patient continue partners higher patients. our to the of manage growth flow effectively

practice include increase training SleepSync strategies strategies which embedded team's and adding tools, independence, all to center and implanters, Our new our key of objective increasing driving are provider of adoption capacity. providers, advanced digital our commercial the and adding

place half second excited are that we of prospects our future XXXX, value. in As remain have drive stakeholder into we we strategy to about move confident appropriate the the and long-term

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

and XX% in and a the period. outside XXXX. of million, U.S. of for is XX% year quarter quarter margin the compared the manufacturing first period. the was $XXX.X the Gross from U.S. million, you, primarily XX.X% sales second was in in the driven prior XX.X%, by increase which the was in increase increased The prior year-over-year. was the XX% afternoon, Tim, year to million increase a $X.X quarter volumes revenue quarter efficiencies. good . Revenue second an in revenue the everyone. was increase Total $XXX.X $XXX Thank million, second million generated $XXX.X from

XXXX. an as Total million the to operating general of primarily planned $XXX.X our compared to quarter the expenses costs. increased quarter due second XX% corporate were for and million, of increase expansion of This $XXX.X was organization the sales in increase second

income As prior Tim in the savings. was period. year in in investments totaled $X.X period. cash an our operating $X.X million are year dividend $X.X our totaled to noted, income yielding quarter and This targeted Interest million by some second DTC driven compared higher compared and the to compared million of year $XX.X balances rates second interest prior ago. income higher million for a investment loss on quarter the to Operating the

million $X.X second million in a a second in net prior compared loss XXXX. million. year quarter net the per $X.XX period of of in diluted was of number in Net net income the $X.XX weighted quarter shares income of share the was The loss $XX.X $XX average outstanding second representing to compared to of quarter the

of repurchases the million now of full approximately outstanding Excluding we year $XX.X be remainder the million. may $XX.X to the shares any diluted we impact over affect to XXXX, expect that share

strategies. position total were The to executing on $XXX at XX. cash strong June Our remain our us allows million growth investments and focused cash

positive for XXXX. We continue cash generate expect to the year full to flow

on XXXX to guidance. Moving

seeing revenue of an full trends to now we to of business, we $XXX With the representing year to million, $XXX in full to XX% our in are be revenue. range XXXX million compared increase XX% the year expect strong

in expect margin XX%. be to to XX% We continue gross of full to range the year

to also XX XXXX. during to quarter activate U.S. remaining XX We centers in continue and new established new XX expect each XX sales U.S. to territories to

will be our momentum income in improving and full we between operating $X.XX $X.XX year per the strong business XXXX our diluted expect the to net leverage, share. for the Given

given excited In repurchase outlook strong the outlook, momentum business conclusion, performance Lastly, remainder million $XXX are confidence with strong us financial and to XXXX. provide our we a announce our our performance in of share authorization. and for

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

of question JPMorgan. from our [Operator Robbie Marcus from line Instructions] And first the comes

a quarter. a on quarter great fantastic Congrats coming here. off Tim,

on really a and way this quarter, a understand second try quarter disappointing good any us good ask X here to want with in quarter procedures this another Help been I quarter, recouped or if was positive So quarter. from of There's issues to here. of X quarter, disappointing we're we and the catch-up sales you forward Is normal? if new first fixed about the do not, back a this basis? fundamental and think all Do how and you think now normal. compensation the force go

a of and second you give sort was Just underlying forward. sense what the the in quarter us go of think .

momentum third up a we little that back want the that of patient that is the we has reflect always all QX, little Got to back forward. talked we impact challenges have with QX, year when a the been We a us had challenges, did had all had team demand, momentum prior that resolved. and at about But authorization way QX a and that in bit we the residual do And important then which believe the going right strong we you. into back really quarter to there really We the in the to and forward. demonstrated going the a going I QX the third have which certainly and the have you the Remember, look Well, quarter. strong last had bit. have on us. a we

in reflect significantly increased we some have of to moving positives the And real revenue hence, year. front. that QX guide we positivity we've fact, going QX the and both into our had have forward. we Yes, have on the In rest confidence

raising you're Great. the for and the year. EPS P&L, profitability here, guide Down Rick. The impressive was the

we rest -- the talked coming they where you're productivity from sales so here force You about coming understand better with are and expenses revenue again, do the from savings where coming the us and of beyond? off advertising. more same into the productive the how and about being vein, how help sustainable just clearly 'XX it's But the digital are of -- on think

to continuing what And top getting on investments. is focused from leverage And to invest growth, in I really the our growing we're continue say Yes, to model. would our drive and adoption. top operating Robbie. leverage we but therapy Thanks, we are Yes. continue make line line -- growth. we business

you second savings. quarter of seeing and a DTC taking ago If revenue. couple a the second targeted revenue. look of are we're items, quarter year in a our more larger of we But XX% was in or at the approach our XX%

we We so in drive leverage XXXX, expense $X second the million continue quarter year. R&D. inventory off second from DTC prelaunch ago. well And about X And R&D not quarter in for in as expect Inspire of that as of a of reminder, have to down to was an of the a as we had this did year with

shifting X efforts Inspire So operational from development we did readiness. to also focus

line $X very top those income, proud we're of overall the operating of proud and of of the which combination second in quarter. of OpEx, between So million into some team's effort and drove items very the

And next from I Richard the Truist from show line comes our of . question Newitter Securities.

us if back Congrats some about utilization And and every also U.S. just be increasing signal on cadence, the you you there's by third U.S. the because Any but think you you wondering us handily second I'm that in in quarter. ads your the come this give updated whether can account any calculation, presupposes the with growth, exceeded seasonality about around new not year in to thinking By just can give and increasing the with as utilization quarter. back be a guide, half particularly we should I'm mid-single-digit that help be utilization the thinking the my line year-over-year or I Maybe, basis should the sequentially on should in quarter. quarter. on half

takes sequentially kind just growth utilization and the it through walk of and back puts us maybe year-over-year. cadence and to So bring the and

Sure.

$XX kind to guidance raised confidence in. $XX of we by have back exceeded Going our of have guidance we've is by consensus a is degree forth we you're put year-to-date, half indicating And high there first consensus we year what of too, Rich, and million, million. the that

full the historically, you our the the composition do quarter of we have year in and throughout generally first As know, year. revenue seasonality builds

And said, that so going aspiration . sequentially forward. utilization with and increase to our year-over-year is

you new number? XX% account XQ. I And Okay. we or me beating the about past, exceeded quarters. a up That's pretty you've number clear of guess, talked quarterly new substantially new right that and more center that the all been I helpful. the Just Is are for they're help how the adds And just have XX% for that your curve. in -- number that? the right few understand think openings in should is the base, you've account lot I this quarterly you to then, the guess about last know in coming assumption? handling accounts the

And it, consistent. Got Rich. been we've very

quarter-to-quarter because go. the that quite they're to open We ready does and in vary ready that we have And pipeline open centers some until for patients to do changed time. guide haven't not

why open and a therapy. significant so when through ready we're centers, And and good And to that's contractual there go. up to number would them training programs, open, We get like Inspire in all do patients centers the is quarter, that with they position high through they're the always the have patient open there's ready of phase their and this with a they to get up. demand,

find And find there's number. always we're health increase going guide it of to ability we're in to a care -- continue But patients' but a proper where to to that further bit provider. been So fluctuation to avenues going little hold is. that

next question. a show I And

the from Piper comes Maeder Sandler. question of next line Adam from Our

the I on the launch. wanted get and rollout on start about to some asking to V Inspire hoping syngas just and the by progress. Rick, U.S. there really granularity commercial more

around a So just us color just wanted many then Gen and confirm prepared as any inventory accounts remarks, maybe I the customers. will but follow-up. you product had set to on your It a when expect event, start And margin do initially capacity to ready target levels first finally, you on that launch? how based pricing level X. question that's is, get and offering like Then you seems with to QX to

you. Got

nice the milestone launch I product. now we have approval be to Inspire into the the making it's have ready think the and But lot team X sufficient to sure our the of the is for last FDA to was that Inspire key the key first the market. development need of to with FDA years the a inventory. U.S. very that week, interactively of The us in is and we questions with came worked proud answer

we once continuous launch to supply of we're that full do able have So products.

to introduce on make in soft purpose really operating our sure of of launch remote. all to tools. So focus The norms were With physician just is with it in the we're really the Sleep and second a programmer that the year. going handful that with of the digital half sync the to and centers

allows a in of able FDA to readiness And so approval to the evaluation to XXXX. look just help have it then having handful the with will the we'll and to lodge on operational excited very about hard a be full to really But XXXX. that that us lean launch and in that launch be use full with centers into

hand me Let pricing on question. to Rick off .

question, Yes. X with with as But strategy We're of Thanks Adam. launch Inspire working pricing, that pricing readiness. margin flat through for said, prior to -- accretive. even part gross operational our the our is

Got it.

to follow-up, guidance circle just that bit unpack little of back to wanted a I and For kind the the more.

to just figure? that million, at QX could or any on $XXX million top cadence for million. -- consensus you on top reaction to line, QX around the the versus $XXX $XXX the line comment I the QX So the guess

also And like specifically OUS about then U.S. it the understand to business guide. the business the thinking better how would just versus as you're to relates

take Sure. I'll that.

consensus year X% guidance, the updated for and of they OUS stand. between reasonable to And revenue. revenue regarding OUS. split the rest full for are estimates our the U.S. our of represent Given still between as will year X% the worldwide

And I from next line of comes Anthony Mizuho . from question our Group. the show Petrone

the here. a have Congrats Inspire maybe X, on and follow-up on on quick still around a couple to is past, funnel you've time said X funnel, strong minutes Inspire the Maybe so GLP-X. total On to on I'll quarter in the Tim, benefit bit a little from is that months. time XX bringing X.X or the procedure in down a going procedure X have X Inspire today. a a hour

So could go once a have I'll And where think launched? do quick you X the follow-up. Inspire funnel is

I improve our the key to efficiencies to And build and of bring you that think point. up ENT opportunities a one capacity. that's with

the that advanced offload We also we can mentioned providers ENT operating help initiatives to But of some also practice the office-based ENT opportunities. help have the room.

day, them more a given endoscopy need ENT wait time, in increasing you capacity, reducing One was do and with of reducing the to the to that have Inspire for overall the patient that, secondly, thereby to receiving a procedures contacting therapy. they hit OR necessarily not procedure. has X physician allows low meaning as of from a having effect BMI a it to patients But sleep time an from with

it overall absolutely, timing. positive have will on a So effect that

for for the still sweet And spot here. that home Are a that obesity population there. mentioned gate much comments sort can you the quantitative BMI do know you of nerve. And seeing in actual a evidence seeing come factor obviously, There betas if you into hypoglossal evidence could not, just large out folks I there. in the then this prepared GLP-Xs upper on GLP-X, follow-up any out specifically. a of of of out how yet? there, out think you are obviously, of mortgage it already XXXX? be Are There's category on

going to patients as for we Well, go think it's we be significant forward.

seeing that to it, subjective they're feedback patients had investigation a the we through on we knew understand trying from physicians working we're As GLP-X. our GLP-X that and

really claims of and to with deck meaning patients that that the kind think number X,XXX number the over an receive dual claims, find a therapy they're and a slides we in review they And . have therapy, up the years upside. of data patients. when updated I independent highlights Inspire third actually last of So can GLP-X X also over provided our you several was we that went on have on and contracted actively do of significant, the party

to with . we're seeing will right again, are communicate therapies So we we for that make complementary because, take help believe these advantage these GLP-Xs Inspire evidence that already continue of now, to physicians going we're therapy. to and our to of patients qualify Inspire sure

from data is would note, It's claims X data all not that I encompassing. just Anthony, provider.

a guys thought it's the to is not on patients X,XXX may data a huge was in share today. Inspire receiving number, of GLP-X capturing and we So helpful with But therapy that it deck. but be you release updated all our

show I Antalffy next comes from UBS. our of the from Danielle And line question

really a quarter on Congrats good here.

more doing bit it's commit is more Just more surgeon guessing And a in really you capacity, not an it, you give there's some color process you guess, share, E&P it time to where to right? and little option thing. X up came I for up think the their getting on but here mind at Inspire this freeing in them think the are maybe of only on capacity X, helpful, therapy. guys but to just in Inspire us I'm of level with I and getting alone fire

it talk guys and about the just leave maybe that other against are question. there little X some So progressing you And at bit those. more initiatives a of how I'll

Danielle. Great, a It's question. great

patients early think surgery, initially, device. capacity ball, it. apposite advanced operating of early patients helping inspires APPs a programming understand from and titration other the the setting of And lot also we what part the a providers, do find in I It's with that twofold. on of practice what can but expect are the And room. to after work, is education seeing of the and care the it's there helping them their that what building improving efficiencies their taking the and in

can free their the to really operating which #X the So the the room, being probably is focus ENT we priority. in up time on

Number patients they operating two, patients, confidence for be initiative they them with time, This and course, really can their little to them reduce to procedure room having they not it's getting an sleep and BMI bit, is reduce the OR X confidently the mentioned, time. we help operating DICE about can in can do then experience, comfortable out own to culminates and going we a so reimbursement help to room low require speak with of them X eliminating as room, in to also gaining the is know endoscopy. operating a you Inspire as And overall proper well. then, predictor

that utilization That reimbursement for a see the capacity. when the centers Inspire. then to think demand a is open practice spend in they and of operating So can quarter the their physician level comfortable doctors reflective is quarter-over-quarter. time grow XX to that's when increased room new the I get desire more awareness to the the increase sufficient, seeing And of in amount they you're really up commit and you what of their

the our show question from comes Michael line I of Sarcone next Jefferies. from And

particularly us So both around about XQ? Can OpEx progress on gross nice in to the trends margin year, on control, give think maybe how you XQ to for start the Rick, back half and help there. just really of any and

Sure. Michael. Thanks question, for the

margin of providing now and XX% to gross provided XX%. earnings So guidance we've share, also per we're that

on Second will OpEx guidance XX% share OpEx year-over-year revenue over quarter growth per our XX% of $X.XX that based that and was our growth our earnings revised share but to be guidance, per XXXX. $X.XX revised implies

the roughly around be XX% that total would be Growth increase so our couple next quarters. million XXXX, OpEx OpEx the in was ratable and of and So or will $XXX growth, year-over-year in a over

on Tim, you Predictor. X maybe, And for

you've successful some some in of of of the kind as you've some of waiting it policies, now some that whom publication we far commentary early just already follow for fair read so large conversations what to the these terms the of and payers, had these data had looks of have positive payers is some payers enough see convince You to around updated to seen it's suit. matter their and start then a really time could for of with

that's exactly true. Yes, I think

of patients. and seeing discussions that's I remember, have Again, just than back open and data some think patients those a -- payers remain class. kind low some our And earlier with to in removed low align discussions. BMI around And other anatomy, just with patients, what sleep DICE GLP-Xs a that endoscopy. sleep our supports specify around we're the we've therefore, that that. the in less it's not had lateral our primarily the they're discussion And who of wall it's It to proper the payers endoscopy. with on only is won't need they to those discussions focus don't lateral But that BMI for does requirement because collapse going patients specifies BMI the patients wall XX. have have intuitive

BMI. the the increase to including have Most remain appliances. removed payers Healthcare AHI, recently, the very active with But we with lot the requirement oral United of in may increase the saw in you the all a trial changes,

a with that the the being prior authorization patients clarified certainly, to also failing patients. manage benefit we trial process, not necessarily refuse around But while able CPAP. language to that's Now of improved CPAP, a they and

continue to patients. improve the clarity we So all and payers across all the maximize work experience for to payers with

of Pasquale Research. from the our from And I . Nephron line comes next show question Chris

as new you was the last to in X about centers. great new year, new guided leverage, I see in territories see. you force. what as sustainable? ratio here, first of new every every added it use to operating look good half of And of X not rep Or The you for terms of X did so just for Is of territory at the more many kind efficient in that particular, ads. the to And was candidates center on it's sales ads, historically,

clinical number sustainable increase also is done we've because is of It the reps. field what

territories the to the have a So of each as and working with as through larger help we well of training. titration the some coverage case support in of some staff

be the just to but leverage really finding ways significantly we're So and ratio, focus we're I long that. don't it increase on I to And think to more going term, continue to we're efficient. going think

data... the on GLP-X And Great.

Chris, this is Ezgi.

to we XX quarter, important dactivations the that It's and in Sorry. center. have we actually X did reactivated note

think little ratio backing that you're I a the maybe So into off.

Little off.

really then results? could post show to apnea. to last patients -- the disruption to those than some to on The air at has is some end the it deck money the target and you to speak And is once therapy the is SURMOUNT-OSA whether out drop do as it's are get more into is the X then the doesn't there conclusion And the see that your dust support in it up How wait the think or and seems point very for and I conversations back that GLP-X drug owned their where pocket Okay. settled. after data guess an going slide patients to that going change the whether going be started before of risk? where helpful. question come resolve me to and they're you about

out for the be patients of to newly that think is are I and Yes, go to diagnosed they key want who GLP-X. going

about think not patient to want months the X sleep to physician sleep about apnea that going sleep on weight XX if being to start lose to months XX talk GLP-X physicians the X deck, of have significant and the time, at community, therapy a the liability them benefit same of in going talked see money loss. because resolve and and weight the accept they're that you're to slide really on to that does their the CPAP I've back the of talking I to of the the they sleep about did

think that they're or gap starting I pocket. not going that patients when if CPAP Inspire help So and to refuse come a time patients to therapy -- think the successful from to then won't to GLP-Xs the at and ready see over on then air is that going you any air same I are really standpoint. be And CPAP

really we running surgeons, even about care we're don't a call, working air the kind within any you to that patient from of receives the of population X ENT visible. in earlier we're mentioned sufficient patient with window, capacity And the months as is, gap an you'll that time that standpoint I practical time that have implant. think see GLP-X call other to The take

question And Brett line I of comes our show next from Markets. KeyBanc from Capital the Fishbin

asked, A X already Inspire follow I'll but the lot X of rollout more up just good the with question. ones on

like -- LMR? the in base any like actually much year? ready see directionally, that on then to want of maybe you move sense next finally, full market how And at talk the have late mean, curious, point initial bit the a the key that milestones launch in you're the installed accounts and would engaging XXXX, maybe launch what start. like general if just in I actually that But like about Just to participating training be we would will a more limited to terms can little and some of timing includes to the you of indicate

and training going lodge. be -- to proving that, measure positive want the positive out be experience centers. it's we . the be think in And limited to is the just being all not And and extensive with some a centers. few launch. a with to I programmers, be it's to just few with remote the an device. milestones It's the very going going getting the with having device a simple we going key but experience externals to the experience a It's limited just

ton And expect you this then to year of or coming up like not $X would of centers. what as added see increased number year may typically for a apples-to-apples new service capacity. is of above but just full All well as right. new number curious, with than here. the X see. like the guidance the at been quarter to adding new number has not of necessarily million, expect just secondary maybe an quick we the past where much But would topic centers value, over opening revenue a centers face be Obviously, follow-up you sites of was X really I'm

if service in doctors? maybe, kind new XX the between just that sites of number like So could that of secondary versus you on touch were balance

quarter, of service. as seeing we're sometimes in of hospitals the basis, Brett, kind a of being centers our and frequently are secondary significant overall XX% growth site sites more about second On ASCs the of end Yes. overall still of used second service. At

Baird. And Rescott of the I from line show next question David comes from

Great. Congrats ads. on the center strong of some your quarter on here. I wanted to go back around new comments utilization,

Is QX if on in you're the QX heard And down year that I in was in about increase that it year. I should right, slice you help way you utilization last a can expect think you And us expecting sequentially. just, think looks I is we noodles to this I just sequential depending the sequentially if why right? in case, QX? guess, like think increase utilization

only said we Yes. items just aspiration the our the briefly to and to not mean we year-over-year in that in that's oral the progress gives we're countries commercial on our continued And reversal increase about requirement. Tim reimbursement we sequentially a about and DTC the talked payers indications. France rest for the that with programs. with of the our for policies utilization in there appliance making did their And therapy are -- positive touched Europe of goal of is lot quarter. second prepared I remarks expanded year adjust confidence like in us continuing

guidance And . to in, so that want put of high we and degree again, increase have forth a confidence to we we

Great. Okay.

Okay.

rather to that than worldwide a is specific maybe that's number the So U.S., correct? something

goal expect is our -- want we U.S., increase or to utilization we in No. the and to U.S.

half, I'm depending into looking the that of total back on in half number numbers positive year. number, half us about EPS OpEx models of out income we shake heard to should the there? back QX? kind That's year-over-year net to thinking helpful. Or for the be around the implied P&L, second and on growth in the of comments again, the just kind cadence Okay. the curious, at the just what's I the Maybe positive relative first is where on kind of the a

sequentially frame XX% And each the in you mentioned And incremental, up that, quarter, Yes. growth third $X that profitable the to The XX% OpEx expect in was And quarter. -- of with way we for when year-over-year OpEx OpEx that million expecting growth million. OpEx. $XXX I increase and in you QX to gets in fourth we're if a about basis. be we kind

Capital show from I next And our Shagun question comes RBC from of line Markets. . Singh the

was you some the talk drivers your I in you Tim, a and could if little bit business. about feel XXXX. of about wondering how

procedure And does said side, would predictor that benefit XX% the up replacement be you be that you answer speed beyond potential doing guess year cycle of think I inspired should around give helpful. XX%, to I'm that would really growth then could could to play out? don't from the that just wondering, Any this that long-term 'XX a about this really you're a have rate? obviously company Inspire's helpful. question, and you expect maybe year. we a confidence study, XX% the you You want in growth Do comments how off And about if be that funnel, that comment

we're in quite penetration business. to And with asked of time years implantables or we safety our Absolutely, have question we Sleep with able have a X the programmer that Inspire for process access. continuing market the or is as help we're not the patients accessories treat profitable care as we efficacy confidence drive about with to are for well a patients, on talk growth unmatched, CEO, our to that technology our about I excited we know to the the limited yes, at number go can I the what that on and number improvements with to the about you're international landscape some in with thanks And for our Sync company when the come. patients based the an tools we our great seeing prospects mention and because stand question. pathway his for That's being with and of growth not down strong excited who very grow. system yet, And, he that patient he's all go the and have improvements our continue looking outcomes. to target of with market, taking going to digital our specific but navigate with do we're to technology, both And

growth forward yes, do in future, we're to growth excited see we heavily our our and of and very going and our in continue invest years So heavily about technology of ahead us.

Got it.

here on Can us your potential primary are the perhaps . the follow-up tell Just you how then guide you in quartile to a give and tracking understand I'm improving Just, us I rates can and beyond. guidance, on guess, where the trying Perhaps decided utilizations top just utilization? customers centers. would utilization. in great. color for secondary primary any going you has versus site to 'XX be are in FY us as for

still having backwards on to work Sure. We're that.

this be of and kind reps and progress that. the centers of work going I year. in working you we'll next But through as the think rest company. we the of We'll the you strength that provide year, gauge in we we close still with as will help of communication. the number continue to we're the to information We're communication to through year on provide stay

number up over somewhere of the a quartile is as centers range implants range X far XX quarters, the of the or approaching top month. procedures to number X As month, or X per the centers, way per of all

we distribution entire continue to we So the and end, continue group to the to push upper want move the of centers. of normal

And comes the Larry question from Biegelsen Fargo. our line next from of Wells

to line? to think what Inspire And what's and have X, And for Inspire do if As in you And code the of Tim CPT right and and Tim, have terms impact determining X? that Rick X are could ski. code, go follow-up. the the process old back I you on you time where have?

and will payers, after. very really to it to it ready for to shape work be and codes No, some and in that all we be the no new clear have good. have all we're going go but for we're there's from reimbursement, a the go with going good Very do training. we to have to centers,

Okay.

. code. the current the you current that you're have you confirmation So use the can code, saying

we'll holiday everybody to a we did go training have package, will to not. that of we're the we going said I when I and out launch. have code plan part and have to

a Got that you this had X on Will asking shelf. them over center or it. I'm stock those said from week down Inspire And we back to to inventory? the And their spoke require Rick, devices take consign. do you centers or they because XX devices work

a up likely a keep What system. have because productive we as level have remember, of account the to has inventory X pretty they're alternatives X X lot inventory down a level talk obviously That's and when to. of ramp they we they going that an their as power the they is they functionality do you Inspire that same the burn B. expect will before with inventory. And that

them So down we're the not looking burn their have at swapping work for inventory. we'll out,

Titchmarsh And from I the from Kallum our show Morgan next comes . line of Stanley. question

maintained through guidance. you of in would thinking It of number light year wanted you ask remainder at could deactivations what on to helpful be for XX, the the about the dynamics we if there center the in saw QX maybe larger a walk of also I added how be versus in U.S., should seems a churn prior this lot and but trends. just the

Sure. Great question.

and been of can -- want the we I to it take to X years, last the key make take And patients centers care managers territory that over want to are productive patients. to X that centers care the that the is not them. on had deactivate ability be have those sure think we of can or focusing

majority Another the in sites. key example of those

physician a different to facility. have just You a moving

centers the they So deactivate. go want and to facility, X we Ezgi surgeon able to on take as hire them, out that over don't another that the care reactivated and too maybe interim, aren't we But reprogram patients. well to them. left team they're to the will take we mentioned, will field but And restart will centers as much the time facility opening we because that program. of we're in And want focus old we have

purposely we deactivate them. So

we pretty consistent of go very on second the several quarter, If last over done an deactivate. of time the annual what kind in basis. back that's close kind years, we've you to

. I think year and 'XX XXXX. we did XXXX in XX% in the

Correct.

So the call year-to-date we've not anomaly. that is really done an

Research. from comes of Polark . question next line from the our Michael Wolfe And

take X I thread then Gen -- flat margin Gen much you Gen just costs gross . was with X it's speculation quarters, if might here X? is price and stand that increase I How magnitude, say of Rick, think accretive. launch might versus have Can X X. they that unit you pricing, consider part there about and a heard us lower to second maybe help X order what Gen a thinking increase to back Where X. does were you be? are the with with of you this price the on

Yes. Mike. details, readiness, we're those operational our working With still through

now lead So not IPG. of the we But have that. be the a continued determined will whether we or are there'll removing pricing that or with be sensing increase price part

that. And with so associated costs be removing will we

did haven't will yet. even it we quantified flat we a so be but And that price, mention accretive with

next our Jon line Block of Stifel. the from question comes from And

mean might rollout mean eliminated quick, the and if X the the you about maybe early lead procedure can -- broader that move anything ask across quickly physician term, move then procedure And in I'm pretty for just X,XXX just this think considering to for you we me. about simplify we regarding centers quantify. my Tim, fee training, I'll guessing worry for Maybe when do Inspire considering you then not And longer can for follow-up. have physician? this does what or the the X and to 'XX, can the simplify but how

Very Thanks much. very good.

for the you the lead, X training of right? hint is surgery you little is a euros part sensing the well That's accepted don't thrilled from think an I a be as going ENT. straightforward, as We very imagine. which pressure and we to bit surgeon, there, implant uncomfortable the I can think, kind $X,XXX, relatively think of is that

skin the think they new term, ENTs do look time sensor do we procedure to a have who wanted it the that that at front to do time. But more OR by the do that will to removing people to going believe skin if a rec I want do and procedure, survey. and we're that reduce on So capacity that longer to

procedure of I for it fairly may is survey. a years take the right couple paid. think And do now, to another rock them

that So because a centers, to but I the will certainly, contractual paid. think working with agreements every physician move and have we significant even centers, just for more all in pricing greater -- team efficiently your process. can have we contracting all they X,XXX server a properly we can I do any do so challenge with that On need though the change we it's to And see sure work through through you'll the don't have center, effectively make question, years, several payment and updates think through we but that. first items is

net the I That And share. -- the of over midpoint mean, of maybe $XX do as age in XX just of way million, sort exercise a take helpful. I terms about revenue, was in just that part year-over-year I to X earnings drop-through. the up was part of year. per think in follow-up, XX really of get guidance, I your $X back really back the same the in almost then income. it through XX% I Rick, drop a impressive If

we that as your work there our areas XXXX? are So spend usual some of really I'm other may EPS accelerate balance any the is again, just solid curious, reflect the to throughout of conservatism? $X.XX power. $X.XX just Or of way you

have that high recent in in Yes. ago, our And R&D XX%. revenue. Thanks particular as in John. Part teens. was it for that do even XX% quarters, This your quarter A variability of of revenue. it was driving percentage number, year question, a of was we QX

Sync So we're our technology and our our platform. continuing sleep in to R&D make in investments

slowing expand commercial make And so continue we're organization. down investments. and in investments not to our We'll also with

So investments. to growth with we're top those Thank drive line We not want slowing down. . you

I line question, our Kratky comes Leerink of the Mike Partners. from slide from show next And

just waiting specifically a been of an are provide characterize would are Inspire patients? on later just time post-ICE have available to patients you implant. And refer backlog the that that that to become waiting update to how you and for clarify, Can get that patients -- Inspire for cleared and current backlog does an to of backlog

Yes. through X increasing once to endoscopy by high to we're the the months, call that talk from great contacting some still ability and at our capacity, can It's a start about is our time a endoscopy that. question, the a is the center there's improvement track there. down. we of running And at seeing patient What implant. lower it a from patients different time somebody to and we takes although -- What to lot they with we the as sleep level, definitions impressive in reduce implant. have And it go sleep about

experience can a way. reduction we results, reduce can sleep we can their that based to you if And endoscopies of predictor on number start the have imagine significant the in

start and manner, So approval expeditious they their we key we focus track get sure a very team right closely now for track can make they that in and the once very get insurance and scheduled very to a patients closely.

a very priority for high team. So the

from And I show the our & from Kalia next Co. comes line Suraj of question Oppenheimer

hear you right? Can me all

That's right.

waiting been wanting sales. not I same-store to -- physicians or them, Any with X commentary additional the your titration A a for XX I to nerve and stem. understand way Even us I'll it's nerve them impact. get my full and quarter. missed know paraphrasing if GLP-X it color months your don't just another Congrats on on hypoglossal take more. months be see to Tim, to this, and Help your X questions, little there also, going second almost for some not and hypoglossal to to question throw really the I I'm liability comments also respond wanting throw way about would X long takes that to pipeline surgery, call. together. And new you're to great. Maybe months through a the X-plus couple you get know qualitative I'll quantitative for stores, a of

appreciated. tie So your greatly you could about comments component liability be the maybe would if

there back go sales, first. Same-store Suraj. Thanks,

increase make I dilutive the on centers the priority utilization think sales utilization a And bit existing at that of certainly what think, or little I to same-store a remember, by a that, the we basis, has is you're to increase that want increased effect by seeing denominator. adding seeing more And continue year-over-year. sure to quarter-over-quarter sites. we the

growing utilization centers. that shows we really are it at So existing

CPAP bit, maybe patients, about left going the as backtrack the physicians don't little of to a far of to and to on want And therapy the talk me untreated. start liability right remain take them so to physicians, be able away let care forward. to from like they to As sleep move patients want . desire a but word they're

Inspire far goes, As endoscopy, to already attempted patients as get get remember, know have it these we through people to takes a authorization a that the time and But are through get it's sleep CPAP. surgery. process, prior that that

efficacy a And therapy. carry tried to therapy selected, safety may And over a be strong them they will and show we very able and that's treated patients they so once But Inspire we've XX,XXX they've why been high to have CPAP with properly forward. with probability our that Inspire date. therapy to benefit using

Bank comes Securities. our of share question And America Stephanie of line [indiscernible] from the I last from

BofA. from Steed Travis actually It's

Okay.

to working. in sneak mind wanted wasn't Just

I've the sequential and several tonight tie in So you're the comfortable of other trying with U.S. consensus revenue. questions comments utilization on to had the to that increase -- in

how quarter. or that in don't utilization about if think know to aspiration the just as I that's sequentially this So it sequential uptick just grows

We of a are for certainly and in rest utilization in the quarter-over-quarter. be going the to year increase quite It's year-over-year. and the --

we're of going the that's team. And the to to continue that. moat commercial focus So on

is Okay. . necessarily not guidance, street sequential comfortable the showing the correct? that But increase,

as those topics. We separate keep

I of other in of UNH X anything that anything curious prioritizations. impact not was there just then QX got was And in question onetime from if is or Perfect. kind Easter came timing that doing investors Okay.

anything it Just would think about to modeling QX was sequentially? onetime in that consider that we

week. sales a cold great had in through we look FedEx went the -- ice We and and past are to this days because a question. and what Yes, tried Travis, month at the actually hurricane that's days of

So didn't highlights no, that we second we -- don't the that. in really quarter single see anything

from the of both I in international think the their proud . well quarter support. as U.S. We're we efforts had a strong as the very and team.

to call today. dedicated their jump thank And just everybody and the and well business as Europe work health to employees me we I success. joining employees and the in team most further wish to all motivation and always, our patients to grateful hard we're care Let element as expanding is and our I Team's continued important remains to the thank for before commitment patient of growing consistent want outcomes. close, we Asia. teams as to focused in to continued Inspire their U.S., unmatched for the achieve as efforts on our of the successful for remain enthusiasm

further appreciate updates continued for of we and and support Inspire, interest the of And forward in look you the months your you all to on call, ahead. providing with

to So thank you very much, you. and Dilem,back

Thank you This conference call. you, sir. concludes Thank today's for attending.

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