INSP - Inspire Medical Systems Inc. (INSP) Q1 2024 Earnings Call Transcript

2024-05-07 22:38:02 ET

Inspire Medical Systems, Inc. (INSP)

Q1 2024 Results Conference Call

May 07, 2024 05:00 PM ET

Company Participants

Ezgi Yagci - VP, IR

Tim Herbert - Chairman and CEO

Rick Buchholz - CFO

Conference Call Participants

Danielle Antalffy - UBS

Travis Steed - Bank of America

Adam Maeder - Piper Sandler

Kallum Titchmarsh - Morgan Stanley

David Rescott - Baird

Anthony Petrone - Mizuho

Chris Pasquale - Nephron

Richard Newitter - Truist Securities

Shagun Singh - RBC

John Block - Stifel

Mike Kratky - Leerink Partners

Michael Sarcone - Jefferies

Larry Biegelsen - Wells Fargo

Michael Polark - Wolfe Research

Suraj Kalia - Oppenheimer

Presentation

Operator

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 First 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.

Ezgi Yagci

Thank you, [Dilem]. And thank you all for participating in today's call. Joining me are Tim Herbert, Chairman and Chief Executive Officer; and Rick Buchholz, Chief Financial Officer. Earlier today, we released financial results for the three months ended March 31, 2024. A copy of the press release is available on our Web site. On this call, management will make forward-looking statements within the meaning of the federal securities laws. All forward-looking statements, including without limitation, those relating to our operations, financial results and financial condition, investments in our business, full year 2024 financial and operational outlook and changes in market access are based upon our current estimates and various assumptions. These statements involve material risks and uncertainties that could cause actual results or events to materially differ. Accordingly, you should not place undue reliance on these statements. Please see our filings with the Securities and Exchange Commission, including our Form 10-Q, which we filed with the SEC earlier this afternoon for a description of these risks and uncertainties. Inspire disclaims any intention or obligation, except as required by law, to update or revise any financial projections or forward-looking statements, whether because of new information, future events or otherwise. This conference call contains time sensitive information and speaks only as of the live broadcast today, May 7, 2024. With that, it is my pleasure to turn the call over to Tim Herbert. Tim?

Tim Herbert

Thank you, Ezgi. And thanks, everyone, for joining our business update call for the first quarter of 2024. We always start our earnings call by reiterating our commitment to delivering strong and consistent patient outcomes. Our mission is to put the patient first and we are thrilled that over 65,000 patients have been treated with Inspire therapy to date. Last week, we celebrated a major milestone with the 10-year anniversary of the FDA approving Inspire therapy. This is only the beginning. And in the years ahead, we look forward to advancing the technology and growing therapy adoption for the many patients with untreated obstructive sleep apnea. With that, let's review our results. In the first quarter, we generated revenue of $164 million, representing a 28% increase compared to the first quarter of 2023. First quarter US revenue totaled $155.8 million, a 25% increase over the same period last year. This revenue growth reflects increased position in patient awareness, increased market penetration in existing centers as well as expansion into 66 new implanting centers in the United States and 11 new US sales territories.

Outside the US, revenue increased 141% to $8.2 million. We're very happy to report a strong rebound in Europe and primarily in Germany since receiving derogation late in the fourth quarter. The derogation process has allowed us to continue to grow the adoption of Inspire therapy. Finally, we continue to work diligently to obtain EU MDR approval, which we expect to receive in mid-2024. On our last earnings call, we indicated more pronounced seasonality of mid to high teens in the first quarter, and the team worked diligently and delivered revenue growth within the expected range while holding seasonality to 15%. With this strong start and our outlook for the remainder of the year, we are increasing our 2024 revenue guidance to $783 million to $793 million, which represents 25% to 27% growth over 2023 revenue of $624.8 million. Our net loss for the first quarter was $10 million compared to the $15.4 million in the prior year period, representing a net loss per share of $0.34 compared to $0.53 in the first quarter of 2023. As our business continues to mature, we expect further operating leverage and now expect to be profitable for the full year 2024. Therefore, we are initiating first time diluted net income per share guidance of $0.10 to $0.20 on for the full year 2024....

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