Inspire Medical Systems Q4 Results: Revenue Tops Estimates, Profits Soar

Financial Highlights

* Revenue: $239.7 million (24.5% YoY growth, 0.9% beat)
* EPS (GAAP): $1.15 (54% beat)
* Adjusted EBITDA: $62.72 million (26.2% margin, 30.4% beat)

Guidance

* Revenue: $947.5 million (18% growth)
* EPS (GAAP): $2.15 (11.4% beat)

Company Overview

Inspire Medical Systems (INSP) develops neurostimulation systems for obstructive sleep apnea (OSA). The company's flagship product improves breathing during sleep.

Industry Dynamics

The medical devices industry faces challenges such as pricing pressures, regulatory compliance, and capital-intensive R&D. However, aging populations and technological advancements drive long-term demand.

Growth Analysis

Inspire Medical Systems' 57.8% annualized revenue growth over the last five years surpasses industry averages. Revenue grew 40.3% annually over the last two years, indicating strong demand. The company's number of U.S. medical centers grew 28.4% YoY over the last two years, driving revenue growth per center.

Operating Margin

Inspire Medical Systems has improved its operating margin over the last five years, reaching 13.3% in Q4. This reflects increased operating leverage from sales growth.

Earnings Per Share

The company's EPS flipped from negative to positive over the last five years, indicating an inflection point. Q4 EPS of $1.15 exceeded estimates by 135% YoY. Analysts project 12.7% EPS growth over the next 12 months.

Conclusion

Inspire Medical Systems' Q4 results were solid, with revenue and EPS beating estimates. The company's full-year guidance also outperformed expectations. While the latest quarter is important, longer-term fundamentals and valuation are crucial in determining the stock's investment potential. For more insights, refer to our full research report available for free.