INSP Q2 results: beat and raise again

I notice that this message’s subject is exactly the same as a previous message I have posted (I guess a year ago, but it might have been two years ago). But, hey, I don’t get tired of saying it. I can’t remember the last time they didn’t raise full-year guidance.

Inspire Medical (INSP) is a device company that creates neurostimulators that are surgically implanted in some patients with sleep apnea (those that do not comply with CPAP devices).

They continue to expand throughout the US, and several international markets are starting to blow up this year, including Japan, Germany, and the Netherlands.

Some quarter highlights:

Revenue growth was 72% versus year-ago.

They added 52 new centers (locations where the surgery is performed) this quarter (7% q-o-q).

Gross margin was 84%.

They raised 2022 full-year guidance from 45% to 53% (at mid-point). They are conservative on guidance, and I expect they will raise this again next quarter.

The FDA approved full-body capability for MRI scans.

They have a 6B market cap. I believe Bear was looking for great new companies with 5-20B market cap to plow money into. My hat is thrown in the ring.



Hi! I feel I have to chime in on this one on a qualitative level. I have had the implant for over a year and it is life-changing for most people (including myself). Personally, it took me a year to get the adjustments needed for it to work! A few additional points:

This is an ever-expanding market (it’s an underdiagnosed condition, especially for women and children). We are only in the early innings of the science of sleep and now we have the technology to monitor sleep more accurately (with devices like the Oura ring).

In Germany, the procedure is covered fully. It is approved in France and the UK and I am assuming that the procedure will be covered by social security.

The competition is CPAP (enough said!)

The procedure will only get easier, and faster, the implant smaller and tech better.

There is a certainty to their quarterly performance which ensures less volatility in the stock

I am a huge fan (started a position two years ago and will add after all our companies have released earnings). It’s in my “lazy - do not touch portfolio”, which accounts for 10% of my entire portfolio - the rest being in Saul’s type companies.