Company: INSP
Filing Date: 2025-08-04
Form Type: 10-Q
Source: 0001609550-25-000032
Chunk: 73

Company: Inspire Medical Systems, Inc.
Filing Date: 2025-08-04
Form: 10-Q
Item: Part I, Item 8
Chunk 73
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4, we limited our credit risk associated with cash equivalents by placing investments with banks we believe are highly creditworthy.We believe that the credit risk in our accounts receivable is mitigated by our credit evaluation process, relatively short collection terms, and dispersion of our customer base. We generally do not require collateral, and losses on accounts receivable have historically not been significant.Accounts Receivable and Allowance for Expected Credit LossesTrade accounts receivable are recorded at the invoiced amount and do not bear interest. Customer credit terms are established prior to shipment with the general standard being net 30 days. Collateral or any other security to support payment of these receivables generally is not required. Each reporting period, we estimate the credit loss related to accounts receivable based on a migration analysis of accounts grouped by individual receivables delinquency status and apply our historic loss rate adjusted for management's assumption of future market conditions. Any change in the allowance from new receivables acquired or changes due to credit deterioration on previously existing receivables is recorded in selling, general and administrative expenses. Write-offs of receivables considered uncollectible are deducted from the allowance. 

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

Specific accounts receivable are written off once a determination is made that the amount is uncollectible. The write-off is recorded in the period in which the account receivable is deemed uncollectible. Recoveries are recognized when received and as a direct credit to earnings or as a reduction to the allowance for credit losses (which would indirectly reduce the loss by decreasing bad debt expense).The following table presents the changes in the allowance for credit losses related to accounts receivable: Three Months Ended June 30,Six Months Ended June 30,2025202420252024Balance at beginning of period$1,191 $256 $880 $1,648 Charges (credits) to the allowance, net155 (19)599 57 Accounts written off, net of recoveries(117)278 (250)(1,190)Balance at the end of the period$1,229 $515 $1,229 $515 The increase in accounts written off, net of recoveries during the six months ended June 30, 2024 are related primarily to accounts receivable with three healthcare systems.InventoriesInventories are valued at