Inspire Medical Systems Reports 22.7% Revenue Growth to $201.3 Million in Q1 2025

Inspire Medical Systems, Inc. reported a significant increase in financial performance for the first quarter of 2025, with revenues reaching $201.3 million, a 22.7% increase from $164.0 million in the same period last year. The company achieved a gross profit of $170.6 million, resulting in a gross margin of 84.7%, slightly down from 84.9% in the previous year. Notably, Inspire recorded a net income of $3.0 million, a substantial turnaround from a net loss of $10.0 million in the first quarter of 2024. This improvement is attributed to increased sales of the Inspire system, particularly in the U.S., where revenue grew by 24.3% to $193.6 million.

The company’s operational metrics also reflected positive trends, with a notable increase in customer engagement and product adoption. As of March 31, 2025, Inspire had 343 U.S. sales territories and 245 field clinical representatives, up from 335 and 230, respectively, at the end of 2024. This expansion is part of Inspire's strategy to enhance its sales and marketing efforts, particularly as it prepares for the launch of its next-generation Inspire system, expected in 2025. However, the company noted that some customers are delaying purchases of the current Inspire IV system in anticipation of the new model, which may temporarily impact revenue.

Inspire's financial position showed a decrease in cash and cash equivalents, which fell to $53.9 million from $150.2 million at the end of 2024. This decline was primarily due to share repurchases totaling $75.0 million and increased inventory purchases. The company’s total assets decreased to $730.8 million, down from $808.4 million at the end of the previous fiscal year, while total liabilities also decreased to $95.1 million from $118.7 million. The accumulated deficit as of March 31, 2025, was $288.9 million.

Looking ahead, Inspire Medical Systems remains focused on expanding its market presence and product offerings. The company plans to continue investing in research and development, particularly for its Inspire therapy and the SleepSync™ platform. Inspire has also secured positive coverage policies with major U.S. commercial payors, covering over 300 million lives, which is expected to support future revenue growth. However, the company acknowledges potential challenges, including macroeconomic factors and competition from emerging treatments for obstructive sleep apnea, such as GLP-1 medications, which may impact demand for its products.

In summary, Inspire Medical Systems has demonstrated strong financial recovery and growth in the first quarter of 2025, driven by increased sales and strategic investments in its product offerings and market expansion. The company is poised for continued growth, although it remains vigilant regarding market dynamics and competitive pressures.