Inspire Medical Systems delivered third quarter 2026 results that exceeded expectations, characterized by sequential revenue growth and expanding gross margins despite year-over-year headwinds. Management highlighted that implanting physicians are becoming increasingly comfortable with the current coding environment as the company prepares for the implementation of new Category I CPT codes in 2028.
Key Highlights
- Revenue reached $206.7 million, beating the $205.2 million estimate and reflecting 3% sequential growth from the prior quarter.
- Adjusted diluted EPS of $0.14 surpassed the $0.10 estimate, though the company recorded a GAAP net loss of $24.4 million primarily due to $24.1 million in restructuring charges.
- Gross margin expanded 20 basis points to 86.0%, driven by an improved sales mix favoring the higher-margin Inspire V system.
- Project Horizon was launched to optimize organizational structure, successfully reallocating $30 million in annualized operating expense toward high-impact revenue growth initiatives.