Company: INSP
Filing Date: 2025-02-10
Form Type: 10-K
Source: 0001609550-25-000011
Chunk: 101

Company: Inspire Medical Systems, Inc.
Filing Date: 2025-02-10
Form: 10-K
Item: Item 8
Chunk 101
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. We did not record any impairment charges on long-lived assets, other than the $0.4 million discussed above in the Strategic Investments section, during the years ended December 31, 2024, 2023, or 2022.Accrued Expenses Accrued expenses consisted of the following:December 31,20242023Payroll related$40,162 $33,875 Income tax payable1,612 577 Product warranty liability933 1,100 Operating lease liabilities, current portion1,754 — Other accrued expenses5,353 3,714 Total accrued expenses$49,814 $39,266 The following table shows the changes in our estimated product warranty liability accrual, included in accrued liabilities:Year Ended December 31,202420232022Balance at beginning of period$1,100 $920 $468 Provisions for warranty593 912 798 Settlements of warranty claims(760)(732)(346)Balance at the end of the period$933 $1,100 $920 

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Table of ContentsInspire Medical Systems, Inc.Notes to Consolidated Financial Statements(Table amounts in thousands, except share and per share amounts)

Revenue RecognitionWe derive our revenue from sales of our products in the U.S. and internationally. Customers are primarily comprised of hospitals and ambulatory surgery centers, with distributors being used in certain international locations where we do not have a direct commercial presence.Revenues from product sales are recognized when the customer obtains control of the product, which occurs at a point in time, either upon shipment of the product or receipt of the product, depending on shipment terms. Our standard shipping terms are free on board shipping point, unless the customer requests that control and title to the inventory transfer upon delivery. In those cases where shipping and handling costs are billed to customers, we classify the amounts billed as a component of cost of goods sold.Revenue is measured as the amount of consideration we expect to receive, adjusted for any applicable estimates of variable consideration and other factors affecting the transaction price, which is based on the invoiced price, in exchange for transferring products. All revenue is recognized when we satisfy our performance obligations under the contract. The majority of our contracts have a single performance obligation and are short term in nature.Sales taxes and value added taxes in foreign jurisdictions that are collected from customers and remitted to governmental authorities are accounted for on a net basis and therefore are excluded from net sales. Shipping and handling costs associated