Yahoo Finance Inspire Medical (INSP) Q4 Earnings, Revenues Top Estimates
Inspire Medical Systems, Inc. INSP delivered earnings per share (EPS) of 10 cents in the fourth quarter of 2022 against the year-over-year loss of 9 cents per share. The figure surpassed the Zacks Consensus Estimate of a loss of 54 cents per share.
Full-year loss per share was $1.60, wider than the loss of $1.54 per share at the end of the comparable 2021 period. However, the figure was narrower than the Zacks Consensus Estimate of a loss of $2.26 per share.
Revenues in Detail
Inspire Medical registered revenues of $137.9 million in the fourth quarter, up 75.9% year over year. The figure surpassed the Zacks Consensus Estimate by 0.1%.
The top-line improvement primarily resulted from strength in U.S. revenues and revenues outside the United States (All other countries).
Full-year revenues were $407.9 million, reflecting a 74.7% surge from the comparable 2021 period. The metric topped the Zacks Consensus Estimate by 0.05%.
Segment Details
Inspire Medical’s operations consist of two geographic regions — the United States and All other countries.
For the quarter under review, U.S. revenues of $134.3 million reflected an increase of 78% from the year-ago quarter on a reported basis. Per management, this upside can be attributed to several factors, including higher utilization at existing centers, the addition of new implanting centers, expanded direct-to-consumer marketing and a higher number of territory managers.
During the reported quarter, Inspire Medical activated 61 new U.S. centers, thus bringing the total to 905 U.S. medical centers implanting Inspire therapy. The company also created 16 new U.S. sales territories in the quarter, bringing the total to 225 U.S. sales territories.
Revenues from outside the United States totaled $3.6 million, up 28% year over year on a reported basis.
Inspire Medical Systems, Inc. Price, Consensus and EPS Surprise
Inspire Medical Systems, Inc. price-consensus-eps-surprise-chart | Inspire Medical Systems, Inc. Quote
Margin Analysis
In the quarter under review, Inspire Medical’s gross profit increased 72.1% to $115.7 million. However, the gross margin contracted 183 basis points (bps) to 83.9%.
Selling, general and administrative expenses surged 61.4% to $94.8 million. Research and development expenses jumped 106.4% year over year to $21.2 million. Operating expenses of $116.1 million increased 68.1% year over year.
Operating loss totaled $0.3 million compared with the prior-year quarter’s operating loss of $1.8 million.
Financial Position
Inspire Medical exited full-year 2022 with cash and cash equivalents, and short-term investments of $451.4 million compared with $214.5 million at the end of 2021.
Guidance
Inspire Medical has initiated its financial outlook for the full-year 2023.
The company projects its full-year revenues to be in the range of $560 million-$570 million, reflecting growth of 37-40% over comparable reported figures in 2022. The Zacks Consensus Estimate for revenues is pegged at $554.1 million.
Inspire Medical also plans to activate 52-56 new U.S. medical centers implanting Inspire therapy and add 12-14 new U.S. sales territories during each quarter of 2023.
Our Take
Inspire Medical exited the fourth quarter of 2022 with better-than-expected results. Robust improvement of the top-line and bottom-line results in the reported quarter was impressive. Strength in year-over-year geographic results was promising. The activation of new U.S. centers and the creation of new U.S. sales territories during the reported quarter also look encouraging. Management’s expectations of activating more U.S. medical centers and adding new U.S. sales territories during each of the quarters of 2023 also raise our optimism about the stock.
However, the rising operating costs putting pressure on the gross margin, thus leading to its contraction, is worrying.
Zacks Rank and Key Picks
Inspire Medical currently carries a Zacks Rank #3 (Hold).
Some better-ranked stocks in the broader medical space that have announced quarterly results are Cardinal Health, Inc. CAH, McKesson Corporation MCK and Hologic, Inc. HOLX.
Cardinal Health, carrying a Zacks Rank #2 (Buy), reported second-quarter fiscal 2023 adjusted EPS of $1.32, beating the Zacks Consensus Estimate by 16.8%. Revenues of $51.47 billion outpaced the consensus mark by 2%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Cardinal Health has a long-term estimated growth rate of 11.6%. CAH’s earnings surpassed estimates in two of the trailing four quarters and missed the same in the other two, the average being 6.4%.
McKesson, having a Zacks Rank #2, reported third-quarter fiscal 2023 adjusted EPS of $6.90, which beat the Zacks Consensus Estimate by 8.8%. Revenues of $70.49 billion outpaced the consensus mark by 0.02%.
McKesson has a long-term estimated growth rate of 10.4%. MCK’s earnings surpassed estimates in two of the trailing four quarters and missed the same in the other two, the average being 3.4%.
Hologic reported first-quarter fiscal 2023 adjusted earnings of $1.07 per share, beating the Zacks Consensus Estimate by 18.9%. Revenues of $1.07 billion surpassed the Zacks Consensus Estimate by 9.5%. It currently sports a Zacks Rank #1.
Hologic has a long-term estimated growth rate of 15.2%. HOLX’s earnings surpassed estimates in all the trailing four quarters, the average surprise being 30.6%.
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Inspire Medical Systems, Inc. (INSP) : Free Stock Analysis Report
