Inspire Medical Systems reported third‑quarter 2025 revenue of $224.5 million, a 10% increase from $203.5 million in the same period last year. Gross margin rose to 85.8% from 84.1% year‑over‑year, reflecting higher product mix and pricing power.
Diluted earnings per share were $0.34, compared with $0.60 in Q3 2024, and a loss of –$0.15 was the consensus estimate for the quarter. Operating income fell to $9.6 million from $14.3 million in Q3 2024, a decline driven by a 17% rise in operating expenses, including $1.3 million in legal fees related to a DOJ civil investigative demand and patent litigation. The company also completed $50 million in share repurchases during the quarter, bringing the year‑to‑date total to $125 million.
Management highlighted the performance of the Inspire V system, noting a 20% increase in implant volume at early‑adopter sites and a 20% reduction in surgical time. Over 75% of centers are now actively implanting the new system, and clinical evidence presented by the company shows significant reductions in disease severity for patients unsuitable for CPAP.
The company reaffirmed its full‑year 2025 revenue guidance of $900 million to $910 million and raised diluted EPS guidance to $0.90 to $1.00, a substantial increase from the prior guidance of $0.40 to $0.50. Inspire also reported ongoing investments in patient marketing and capacity expansion to support the growing demand for its therapy.
Management acknowledged headwinds such as increased operating costs, legal expenses, and competitive pressures, but emphasized the positive trajectory of reimbursement developments, including proposed increases for CPT code 64568 in 2026, and the continued adoption of the Inspire V system as key drivers of future growth.
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