Company: INSP
Filing Date: 2025-11-03
Form Type: 10-Q
Source: 0001609550-25-000053
Chunk: 132

Company: Inspire Medical Systems, Inc.
Filing Date: 2025-11-03
Form: 10-Q
Item: Part I, Item 2
Chunk 132
---
 system experienced during the first nine months of 2025, and to a lesser extent, the $2.1 million charge associated with excess components related to Inspire IV.

Gross margin decreased to 84.9% for the nine months ended September 30, 2025 from 84.5% for the nine months ended September 30, 2024. Gross margin for the nine months ended September 30, 2025 was higher primarily due to increased sales volume as well as increased sales mix of the Inspire V system, which is less expensive to manufacture and therefore has a higher gross margin than the Inspire IV system, partially offset by the excess inventory component charges discussed above.

Research and Development Expenses

Research and development expenses decreased $5.6 million, or 6.6%, to $78.2 million for the nine months ended September 30, 2025 compared to $83.8 million for the nine months ended September 30, 2024. This change was primarily due to a decrease of $16.6 million in ongoing research and development costs, primarily with respect to our next generation versions of the Inspire neurostimulator, our physician programmer, and our SleepSync™ platform, partially offset by an increase of $10.5 million in compensation and employee-related expenses, mainly as 

36

a result of increased headcount and stock-based compensation expense, and an increase of $0.5 million in regulatory submissions and clinical studies expenses and quality compliance fees.

Selling, General and Administrative Expenses

SG&A expenses increased $74.6 million, or 19.2%, to $462.7 million for the nine months ended September 30, 2025 compared to $388.1 million for the nine months ended September 30, 2024. The primary driver of this change was an increase of $45.2 million in compensation, including salaries, commissions, stock-based compensation, and other employee-related expenses, mainly as a result of increased headcount. In addition, marketing costs increased $18.4 million, mainly for advertising, and general corporate costs increased $7.0 million, primarily due to legal fees, depreciation expense, computer equipment and software expense, and consulting fees. Also contributing to the increase were travel expenses, which increased by $4.0 million.

Other Income, Net

Other income, net decreased by $7.1 million, to $10.5 million for the nine months ended September 30, 2025 compared to $