Inspire Medical Systems (INSP) 10-K 10 Feb 23 2022 FY Annual report Financial data

Cover

Cover - USD ($)	12 Months Ended
	Dec. 31, 2022	Feb. 03, 2023	Jun. 30, 2022
Cover [Abstract]
Document Type	10-K
Document Annual Report	true
Document Period End Date	Dec. 31, 2022
Current Fiscal Year End Date	--12-31
Document Transition Report	false
Entity File Number	001-38468
Entity Registrant Name	Inspire Medical Systems, Inc.
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	26-1377674
Entity Address, Address Line One	5500 Wayzata Blvd.
Entity Address, Address Line Two	Suite 1600
Entity Address, City or Town	Golden Valley
Entity Address, State or Province	MN
Entity Address, Postal Zip Code	55416
City Area Code	844
Local Phone Number	672-4357
Title of 12(b) Security	Common stock, $0.001 par value
Trading Symbol	INSP
Security Exchange Name	NYSE
Entity Well-known Seasoned Issuer	Yes
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
ICFR Auditor Attestation Flag	true
Entity Shell Company	false
Entity Public Float			$ 4,965,635,153
Entity Common Stock, Shares Outstanding (in shares)		29,048,386
Documents Incorporated by Reference	Portions of the registrant’s definitive proxy statement for its 2023 annual stockholders’ meeting, which is to be filed within 120 days of the registrant’s fiscal year ended December 31, 2022, are incorporated by reference into Part III of this Annual Report on Form 10-K.
Entity Central Index Key	0001609550
Amendment Flag	false
Document Fiscal Year Focus	2022
Document Fiscal Period Focus	FY

Audit Information

Audit Information	12 Months Ended
	Dec. 31, 2022
Audit Information [Abstract]
Auditor Name	Ernst & Young LLP
Auditor Location	Minneapolis, MN
Auditor Firm ID	42

Consolidated Balance Sheets

Consolidated Balance Sheets - USD ($) $ in Thousands	Dec. 31, 2022	Dec. 31, 2021
Current assets:
Cash and cash equivalents	$ 441,592	$ 214,467
Investments, short-term	9,821	0
Accounts receivable, net of allowance for credit losses of $36 and $99, respectively	61,228	34,179
Inventories, net	11,886	17,231
Prepaid expenses and other current assets	5,505	2,660
Total current assets	530,032	268,537
Investments, long-term	0	9,938
Property and equipment, net	17,249	8,486
Operating lease right-of-use assets	6,880	7,919
Other non-current assets	10,715	204
Total assets	564,876	295,084
Current liabilities:
Accounts payable	26,847	11,665
Accrued expenses	34,339	20,454
Notes payable, current portion	0	9,188
Total current liabilities	61,186	41,307
Notes payable, non-current portion	0	15,799
Operating lease liabilities, non-current portion	7,536	8,796
Other non-current liabilities	146	134
Total liabilities	68,868	66,036
Stockholders' equity
Preferred Stock, $0.001 par value, 10,000,000 shares authorized; no shares issued and outstanding	0	0
Common Stock, $0.001 par value, 200,000,000 shares authorized; 29,008,368 and 27,416,106 shares issued and outstanding at December 31, 2022 and 2021, respectively	29	27
Additional paid-in capital	820,335	508,465
Accumulated other comprehensive loss	(86)	(55)
Accumulated deficit	(324,270)	(279,389)
Total stockholders' equity	496,008	229,048
Total liabilities and stockholders' equity	$ 564,876	$ 295,084
Operating Lease, Liability, Current, Statement of Financial Position [Extensible List]	Accrued expenses	Accrued expenses

Consolidated Balance Sheets (Pa

Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands	Dec. 31, 2022	Dec. 31, 2021
Statement of Financial Position [Abstract]
Allowance for credit loss	$ 36	$ 99
Preferred stock, par value (in dollars per share)	$ 0.001	$ 0.001
Preferred stock, authorized (in shares)	10,000,000	10,000,000
Preferred stock, issued (in shares)	0	0
Preferred stock, outstanding (in shares)	0	0
Common stock, par value (in dollars per share)	$ 0.001	$ 0.001
Common stock, authorized (in shares)	200,000,000	200,000,000
Common stock, issued (in shares)	29,008,368	27,416,106
Common stock, outstanding (in shares)	29,008,368	27,416,106

Consolidated Statements of Oper

Consolidated Statements of Operations and Comprehensive Loss - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2022	Dec. 31, 2021	Dec. 31, 2020
Income Statement [Abstract]
Revenue	$ 407,856	$ 233,394	$ 115,381
Cost of goods sold	66,115	33,279	17,623
Gross profit	341,741	200,115	97,758
Operating expenses:
Research and development	68,645	37,350	26,092
Selling, general and administrative	320,688	202,615	127,874
Total operating expenses	389,333	239,965	153,966
Operating loss	(47,592)	(39,850)	(56,208)
Other expense (income):
Interest and dividend income	(5,050)	(125)	(1,092)
Interest expense	1,677	2,128	2,117
Other expense (income), net	49	117	(145)
Total other (income) expense	(3,324)	2,120	880
Loss before income taxes	(44,268)	(41,970)	(57,088)
Income taxes	613	72	115
Net loss	(44,881)	(42,042)	(57,203)
Other comprehensive loss:
Foreign currency translation gain	89	0	0
Unrealized loss on investments	(120)	(84)	(73)
Total comprehensive loss	$ (44,912)	$ (42,126)	$ (57,276)
Net loss per share, basic (in dollars per share)	$ (1.60)	$ (1.54)	$ (2.19)
Net loss per share, diluted (in dollars per share)	$ (1.60)	$ (1.54)	$ (2.19)
Weighted average common shares used to compute net loss per share, basic (in shares)	28,071,748	27,262,979	26,073,418
Weighted average common shares used to compute net loss per share, diluted (in shares)	28,071,748	27,262,979	26,073,418

STATEMENTS OF STOCKHOLDERS' EQU

STATEMENTS OF STOCKHOLDERS' EQUITY - USD ($) $ in Thousands	Total	Cumulative Effect, Period of Adoption, Adjustment	Common Stock	Additional Paid-in Capital	Accumulated Other Comprehensive (Loss) Income	Accumulated Deficit	Accumulated Deficit Cumulative Effect, Period of Adoption, Adjustment	Follow-On Public Offering	Follow-On Public Offering Common Stock	Follow-On Public Offering Additional Paid-in Capital	Follow-on Offering	Follow-on Offering Common Stock	Follow-on Offering Additional Paid-in Capital
Beginning balance at Dec. 31, 2019	$ 139,835	$ 12	$ 24	$ 319,865	$ 102	$ (180,156)	$ 12
Beginning balance, common stock, outstanding (in shares) at Dec. 31, 2019			24,107,350
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Stock options exercised	$ 7,050		$ 0	7,050
Stock options exercised (in shares)	624,315		624,315
Issuance and sale of common stock	$ 294			294				$ 124,654	$ 3	$ 124,651
Issuance and sale of common stock (in shares)			3,378						2,300,000
Issuance of common stock for employee stock purchase plan	2,361			2,361
Issuance of common stock for employee stock purchase plan (in shares)			34,233
Stock-based compensation expense	12,817			12,817
Other comprehensive loss	(73)				(73)
Net loss	(57,203)					(57,203)
Ending balance at Dec. 31, 2020	$ 229,747		$ 27	467,038	29	(237,347)
Ending balance, common stock, outstanding (in shares) at Dec. 31, 2020			27,069,276
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Accounting Standards Update [Extensible List]	Accounting Standards Update 2016-13 [Member]
Stock options exercised	$ 11,476			11,476
Stock options exercised (in shares)	323,860		323,860
Issuance and sale of common stock	$ 301			301
Issuance and sale of common stock (in shares)			1,463
Issuance of common stock for employee stock purchase plan	3,472			3,472
Issuance of common stock for employee stock purchase plan (in shares)			21,507
Stock-based compensation expense	26,178			26,178
Other comprehensive loss	(84)				(84)
Net loss	(42,042)					(42,042)
Ending balance at Dec. 31, 2021	$ 229,048		$ 27	508,465	(55)	(279,389)
Ending balance, common stock, outstanding (in shares) at Dec. 31, 2021	27,416,106		27,416,106
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Stock options exercised	$ 12,081		$ 1	12,080
Stock options exercised (in shares)	416,602		416,602
Vested (in shares)			569
Withholding taxes on net share settlement of restricted stock units	$ (43)			(43)
Withholding taxes on net share settlement of restricted stock units (in shares)			(205)
Issuance and sale of common stock	325			325							$ 243,801	$ 1	$ 243,800
Issuance and sale of common stock (in shares)			1,587									1,150,000
Issuance of common stock for employee stock purchase plan	3,738			3,738
Issuance of common stock for employee stock purchase plan (in shares)			23,709
Stock-based compensation expense	51,970			51,970
Other comprehensive loss	(31)				(31)
Net loss	(44,881)					(44,881)
Ending balance at Dec. 31, 2022	$ 496,008		$ 29	$ 820,335	$ (86)	$ (324,270)
Ending balance, common stock, outstanding (in shares) at Dec. 31, 2022	29,008,368		29,008,368

Consolidated Statements of Cash

Consolidated Statements of Cash Flows - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2022	Dec. 31, 2021	Dec. 31, 2020
Operating activities
Net loss	$ (44,881)	$ (42,042)	$ (57,203)
Adjustments to reconcile net loss:
Depreciation and amortization	1,858	1,218	840
Non-cash lease expense	1,040	771	972
Stock-based compensation expense	51,970	26,178	12,817
Non-cash stock issuance for services rendered	325	301	294
Other, net	(553)	310	113
Changes in operating assets and liabilities:
Accounts receivable	(27,017)	(9,244)	(11,842)
Inventories	5,345	(8,752)	(2,645)
Prepaid expenses and other assets	(2,815)	(696)	416
Accounts payable	14,355	4,779	2,048
Accrued expenses and other liabilities	11,942	7,058	1,145
Net cash provided by (used in) operating activities	11,569	(20,119)	(53,045)
Investing activities
Purchases of property and equipment	(9,096)	(4,668)	(2,455)
Purchases of investments	0	(9,993)	(52,721)
Proceeds from sales or maturities of investments	0	43,800	141,803
Purchases of strategic investments	(10,500)	0	0
Net cash (used in) provided by investing activities	(19,596)	29,139	86,627
Financing activities
Payments on long-term debt obligation	(24,500)	0	0
Proceeds from the exercise of stock options	12,081	11,476	7,050
Proceeds from sale of common stock	243,801	0	124,654
Taxes paid on the net share settlement of restricted stock units	(43)	0	0
Proceeds from the issuance of common stock from employee stock purchase plan	3,738	3,472	2,361
Net cash provided by financing activities	235,077	14,948	134,065
Effect of exchange rate on cash	75	(19)	11
Increase in cash and cash equivalents	227,125	23,949	167,658
Cash and cash equivalents at beginning of year	214,467	190,518	22,860
Cash and cash equivalents at end of year	441,592	214,467	190,518
Supplemental cash flow information
Cash paid for interest	2,321	1,888	1,893
Property and equipment included in accounts payable and accrued expenses	$ 2,067	$ 274	$ 816

Organization

Organization	12 Months Ended
	Dec. 31, 2022
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Organization	Organization Description of Business Inspire Medical Systems, Inc. is a medical technology company focused on the development and commercialization of innovative, minimally invasive solutions for patients with obstructive sleep apnea ("OSA"). Our proprietary Inspire system is the first and only United States ("U.S.") Food and Drug Administration ("FDA") approved neurostimulation technology that provides a safe and effective treatment for moderate to severe OSA. Inspire therapy received premarket approval ("PMA") from the FDA in 2014 and has been commercially available in certain European markets since 2011. Japan's Ministry of Health, Labour and Welfare ("MLHW") approved Inspire therapy to treat moderate to severe OSA in 2018 and was formally added to the Japan National Health Insurance Payment Listing in 2021. In 2020, the Australian Therapeutic Goods Administration approved Inspire therapy to treat moderate to severe OSA, and we are currently seeking reimbursement coverage in Australia.

Summary of Significant Accounti

Summary of Significant Accounting Policies	12 Months Ended
	Dec. 31, 2022
Accounting Policies [Abstract]
Summary of Significant Accounting Policies	Summary of Significant Accounting Policies Basis of Presentation The consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles ("U.S. GAAP") and pursuant to the rules and regulations of the Securities and Exchange Commission ("SEC"). In the opinion of management, all adjustments, consisting of only normal recurring adjustments that are necessary to present fairly the financial position, results of operations, and cash flows have been made. The results of operations for the year ended December 31, 2022 are not necessarily indicative of the operating results for any future periods. Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts and disclosures reported in the consolidated financial statements. We use significant judgment when making estimates related to the allowance for credit losses, inventory reserves, warranty reserves, and stock-based awards. We base our estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results could differ from those estimates. Follow-On Public Offering In August 2022, we completed a follow-on offering that included our offer and sale of 1,150,000 shares of common stock at a public offering price of $215.00 per share. We received net proceeds of $243.8 million after deducting underwriting discounts, commissions, and offering expenses. Cash and Cash Equivalents We consider all highly liquid securities, readily convertible to cash, that have original maturities of 90 days or less from the date of purchase to be cash equivalents. The carrying amount reported in the consolidated balance sheets for cash is cost, which approximates fair value. Foreign Currency Our functional and reporting currency is the U.S. dollar. Our subsidiary has a functional currency in Euro. The consolidated financial statements are translated to U.S. dollars. Non-monetary assets and liabilities denominated in foreign currencies are translated at rates of exchange in effect at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies are translated using the exchange rate prevailing at the balance sheet date. Sales and expenses denominated in foreign currencies are translated at exchange rates in effect on the date of the transaction. Foreign currency transaction gains and losses and the impacts of foreign currency remeasurement are recognized in other expense (income), net in the consolidated statements of operations and comprehensive loss. For the years ended December 31, 2022 and 2021, we recognized a total of $0.1 million and $0.2 million of gains, net, respectively. Any unrealized gains and losses due to translation adjustments are included in accumulated other comprehensive loss within stockholders' equity in the consolidated balance sheets. We had $0.1 million and $0 of unrecognized gain in our accumulated other comprehensive loss balance as of December 31, 2022 and 2021, respectively. Investments At December 31, 2022 and 2021, our investments consisted of U.S. government securities. Investments are reported at their estimated fair market values which are based on quoted, active or inactive market prices when available. Any unrealized gains and losses due to interest rate fluctuations and other external factors are reported as a separate component of accumulated other comprehensive loss within stockholders' equity. We had $0.2 million and $0.1 million of unrecognized loss in our accumulated other comprehensive loss balance at December 31, 2022 and 2021, respectively. Any realized gains and losses are calculated on the specific identification method and reported net in other expense (income), net in the consolidated statements of operations and comprehensive loss. For both of the years ended December 31, 2022 and 2021, we recognized $0 of gains, net. We recognize expected credit losses on investments in accordance with Accounting Standards Update ("ASU"), ASU 2016-13, Financial Instruments - Credit Losses ("ASU 2016-13"), which we adopted effective January 1, 2020 using the modified retrospective approach. The adoption of ASU 2016-13 did not have a material impact on the amount and timing of credit losses recognized in our consolidated financial statements. We reassess our estimated credit losses on investments each reporting period. U.S. government securities and cash equivalents are under a "zero-loss exception" for credit losses, meaning no credit loss risk calculation is necessary on those instruments due to the exceptionally low rate of default, which continues to decrease as the securities approach maturity, which for us is no longer than two years. We record changes in the allowance for credit losses for available-for-sale debt securities with a corresponding adjustment in credit loss expense on the consolidated statement of operations and comprehensive loss. No reversal of a previously recorded allowance for credit losses may be made to an amount below zero. The total allowance for credit losses was $0 at both December 31, 2022 and 2021. Fair Value of Financial Instruments We measure certain financial assets and liabilities at fair value on a recurring basis, including cash equivalents and investments. Fair value is an exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or a liability. A three-tier fair value hierarchy is established as a basis for considering such assumptions and for inputs used in the valuation methodologies in measuring fair value: Level 1: Observable inputs, such as quoted prices (unadjusted) for identical assets or liabilities in active markets. Level 2: Inputs other than quoted prices in active markets for identical assets and liabilities that are observable either directly or indirectly for substantially the full term of the asset or liability. Level 3: Unobservable inputs that are supported by little or no market activities, which would require us to develop our own assumptions. We use the methods and assumptions described below in determining the fair value of our financial instruments. Money market funds: Fair values of money market funds are based on quoted market prices in active markets. These are included as Level 1 measurements in the tables below. U.S. government securities: Consists of U.S. government Treasury bills with original maturities of less than two years and are based on quoted prices in active markets. These are included as a Level 1 measurement in the tables below. The following tables sets forth by level within the fair value hierarchy our assets that are measured on a recurring basis and reported at fair value as of December 31, 2022 and 2021. Assets are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. Fair Value Measurements as of December 31, 2022 Estimated Fair Value Level 1 Level 2 Level 3 Cash equivalents: Money market funds $ 390,846 $ 390,846 $ — $ — Total cash equivalents 390,846 390,846 — — Investments: U.S. government securities 9,821 9,821 — — Total investments 9,821 9,821 — — Total cash equivalents and investments $ 400,667 $ 400,667 $ — $ — Fair Value Measurements as of December 31, 2021 Estimated Fair Value Level 1 Level 2 Level 3 Cash equivalents: Money market funds $ 189,369 $ 189,369 $ — $ — Total cash equivalents 189,369 189,369 — — Investments: U.S. government securities 9,938 9,938 — — Total investments 9,938 9,938 — — Total cash equivalents and investments $ 199,307 $ 199,307 $ — $ — There were no transfers between levels during the years ended December 31, 2022 and 2021. Concentration of Credit Risk Financial instruments, which potentially subject us to concentrations of credit risk, consist principally of cash equivalents, investments, and accounts receivable. Our investment policy limits investments to certain types of debt securities issued by the U.S. government and its agencies, corporations with investment-grade credit ratings, or commercial paper and money market funds issued by the highest quality financial and non-financial companies. We place restrictions on maturities and concentration by type and issuer. We are exposed to credit risk in the event of a default by the issuers of these securities to the extent recorded on the consolidated balance sheets. However, as of December 31, 2022 and 2021, 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 Losses Trade 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. 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). Inventories Inventories are valued at the lower of cost or net realizable value, computed on a first-in, first-out basis, and consisted of the following: December 31, 2022 2021 Raw materials $ 5,645 $ 3,119 Finished goods 6,241 14,112 Total inventories, net of reserves $ 11,886 $ 17,231 We regularly review inventory quantities on-hand for excess and obsolete inventory and, when circumstances indicate, incur charges to write down inventories to their net realizable value. The determination of a reserve for excess and obsolete inventory involves management exercising judgment to determine the required reserve, considering future demand, product life cycles, introduction of new products and current market conditions. During the year ended December 31, 2022, we recorded a $1.8 million inventory reserve related to product introductions, including the new silicone-based leads and the Bluetooth®-enabled patient remote. The reserve for excess and obsolete inventory was $2.7 million and $0.3 million as of December 31, 2022 and 2021, respectively. Property and Equipment Property and equipment are stated at cost, less accumulated depreciation and amortization and consisted of the following: December 31, 2022 2021 Computer equipment and software $ 1,729 $ 1,397 Manufacturing equipment 5,974 4,436 Other equipment 535 249 Leasehold improvements 2,064 281 Construction in process 11,857 5,175 Property and equipment, cost 22,159 11,538 Less: accumulated depreciation and amortization (4,910) (3,052) Property and equipment, net $ 17,249 $ 8,486 Depreciation is determined using the straight-line method over the estimated useful lives of the respective assets, generally three Strategic Investments For equity securities without readily determinable fair values, we have elected the measurement alternative under which we measure these investments at cost minus impairment, if any, plus or minus changes resulting from observable price changes in orderly transactions for the identical or a similar investment of the same issuer. These securities are presented within other non-current assets on the consolidated balance sheets. The balance of equity securities without readily determinable fair values was $10.5 million and $0 as of December 31, 2022 and 2021, respectively. There were no adjustments to the carrying amount during the year ended December 31, 2022. Impairment of Long-lived Assets Long-lived assets consist primarily of property and equipment and operating lease right-of-use asset and are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. If circumstances require that an asset be tested for possible impairment, we compare the undiscounted cash flows expected to be generated by the asset to the carrying amount of the asset. If the carrying amount of the asset is not recoverable on an undiscounted cash flow basis, we determine the fair value of the asset and recognize an impairment loss to the extent the carrying amount of the asset exceeds its fair value. We determine fair value using the income approach based on the present value of expected future cash flows or other appropriate measures of estimated fair value. Our cash flow assumptions consider historical and forecasted revenue and operating costs and other relevant factors. We did not record any impairment charges on long-lived assets during the years ended December 31, 2022, 2021, or 2020. Accrued Expenses Accrued expenses consisted of the following: December 31, 2022 2021 Payroll related $ 30,398 $ 17,655 Interest — 160 Product warranty liability 920 468 Operating lease liabilities, current portion 1,336 312 Other accrued expenses 1,685 1,859 Total accrued expenses $ 34,339 $ 20,454 The following table shows the changes in our estimated product warranty liability accrual, included in accrued liabilities: Year Ended December 31, 2022 2021 2020 Balance at beginning of period $ 468 $ 159 $ 115 Provisions for warranty 798 576 137 Settlements of warranty claims (346) (267) (93) Balance at the end of the period $ 920 $ 468 $ 159 Revenue Recognition We 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 with outbound freight after control over a product has transferred to a customer are accounted for as a fulfillment cost and are included in cost of goods sold. Variable consideration related to certain customer sales incentives is estimated based on the amounts expected to be paid based on the agreement with the customer using probability assessments. We offer customers a limited right of return for our product in case of non-conformity or performance issues. We estimate the amount of our product sales that may be returned by our customers based on historical sales and returns. As our historical product returns to date have been immaterial, we have not recorded a reduction in revenue related to variable consideration for product returns. See Note 9 for disaggregated revenue by geographic area. Cost of Goods Sold Cost of goods sold consists primarily of acquisition costs for the components of the Inspire system, overhead costs, scrap and inventory obsolescence, warranty replacement costs, as well as distribution-related expenses such as logistics and shipping costs, net of shipping costs charged to customers. The overhead costs include the cost of material procurement, depreciation expense for production equipment, and operations supervision and management personnel, including employee compensation, stock-based compensation, supplies, and travel. Research and Development Research and development expenses consist primarily of product development, clinical and regulatory affairs, quality assurance, consulting services, and other costs associated with products and technologies in development. These expenses include employee compensation, including stock-based compensation, supplies, materials, consulting, and travel expenses related to research and development programs. Clinical expenses include clinical study design, clinical site reimbursement, data management, travel expenses, and the cost of manufacturing products for clinical studies. Stock-Based Compensation We maintain an equity incentive plan to provide lon g-term incentives for eligible employees, consultants, and members of the board of directors. The plan allows for the issuance of restricted stock units ("RSUs"), performance stock units ("PSUs"), and non-statutory and incentive stock options to employees, and RSUs, PSUs, and non-statutory stock options to consultants and directors. We also offer an employee stock purchase plan ("ESPP") which allows participating employees to purchase shares of our common stock at a discount through payroll deductions. We recognize equity-based compensation expense for awards of equity instruments based on the grant date fair value of those awards as expense in the consolidated statements of operations and comprehensive loss. We estimate the fair value of stock options using the Black-Scholes option pricing model and the fair value of RSUs and PSUs is equal to the closing price of our common stock on the grant date. The fair value of each purchase under the employee stock purchase plan is estimated at the beginning of the offering period using the Black-Scholes option pricing model. Stock-based compensation expense is recognized on a straight-line basis over the vesting term for stock options and RSUs, and over the vesting and performance period based on the probability of achieving the performance objectives for PSUs. We account for award forfeitures as they occur. Advertising Expenses We expense the costs of advertising, including promotional expenses, as incurred. Advertising expenses were $74.3 million, $47.8 million, and $26.4 million during the years ended December 31, 2022, 2021, and 2020, respectively. Leases Operating leases are included in operating lease right-of-use ("ROU") asset, accrued expenses, and operating lease liability – non-current portion in our consolidated balance sheets. ROU assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are recognized at the lease commencement date based on the present value of lease payments over the lease term. In determining the present value of lease payments, we use our incremental borrowing rate based on the information available at the lease commencement date as the rate implicit in the lease is not readily determinable. The determination of our incremental borrowing rate requires management judgment based on information available at lease commencement. The operating lease ROU assets also include adjustments for prepayments, accrued lease payments, and exclude lease incentives. Our lease terms may include options to extend or terminate the lease when it is reasonably certain that we will exercise such options. Operating lease cost is recognized on a straight-line basis over the expected lease term. Lease agreements that include lease and non-lease components are accounted for as a single lease component. Lease agreements with a noncancelable term of less than 12 months are not recorded on our consolidated balance sheets. Income Taxes We account for income taxes using the liability method. Under this method, deferred tax assets and liabilities are determined based on the differences between the financial reporting and tax bases of assets and liabilities and are measured using the enacted tax rates that will be in effect when the differences are expected to reverse. Valuation allowances against deferred tax assets are established, when necessary, to reduce deferred tax assets to the amounts expected to be realized. As we have historically incurred operating losses, we have recorded a full valuation allowance against our net deferred tax assets, and there is no provision for income taxes other than minimal state and foreign taxes, which includes a foreign tax provision relating to uncertain tax positions. Our policy is to record interest and penalties expense related to uncertain tax positions as other expense in the consolidated statements of operations and comprehensive loss. Comprehensive Loss Comprehensive loss consists of net loss and changes in unrealized gains and losses due to interest rate fluctuations and other external factors on investments classified as available-for-sale, and foreign currency translation adjustments. Accumulated other comprehensive loss is presented in the accompanying consolidated balance sheets as a component of stockholders' equity. Loss Per Share Basic net loss per share is computed by dividing the net loss by the weighted average number of shares of common stock outstanding during the period. Diluted net loss per share is computed by dividing the net loss by the weighted average number of shares of common stock and dilutive potential shares of common stock outstanding during the period. Because we have reported a net loss for all periods presented, diluted net loss per share is the same as basic net loss per share as all potentially dilutive shares consisting of outstanding stock options, unvested RSUs and PSUs, and shares issuable under our employee stock purchase plan were antidilutive in those periods. Purchase Commitments As of December 31, 2022, we had purchase commitments to suppliers for purchases totaling $157.4 million. Recent Accounting Pronouncements We have reviewed and considered all recent accounting pronouncements that have not yet been adopted and believe there are none that could potentially have a material impact on our business practices, financial condition, results of operations, or disclosures.

Investments

Investments	12 Months Ended
	Dec. 31, 2022
Investments, Debt and Equity Securities [Abstract]
Investments	InvestmentsOur investments are classified as available-for-sale and consist of the following: December 31, 2022 Amortized Unrealized Gross Aggregate Cost Gains Losses Fair Value Short-Term: U.S. government securities $ 9,998 $ — $ (177) $ 9,821 Short-term investments $ 9,998 $ — $ (177) $ 9,821 December 31, 2021 Amortized Unrealized Gross Aggregate Cost Gains Losses Fair Value Long-Term: U.S. government securities $ 9,993 $ — $ (55) $ 9,938 Long-term investments $ 9,993 $ — $ (55) $ 9,938 As of December 31, 2022, we had no investments with a contractual maturity of greater than two years. Currently, we do not intend to sell the investments and it is not more likely than not that we will be required to sell the investments before recovery of their amortized cost bases, which may be maturity. We do not consider those investments to be other-than-temporarily impaired as of December 31, 2022. At the end of each reporting period, we evaluate potential credit impairment on available-for-sale securities in an unrealized loss position, based on the expected cash flows to be collected and the yield-to-maturity on those securities. Securities with a valuation allowance for expected credit losses and deemed uncollectible are permanently written down, and a reversal out of the valuation allowance occurs.

Leases

Leases	12 Months Ended
	Dec. 31, 2022
Leases [Abstract]
Leases	Leases We lease approximately 70,000 square feet of office space for our corporate headquarters under non-cancelable operating leases. The leases expire May 31, 2028 with options to renew for one additional period of five years at the then-prevailing market rate. The exercises of the lease renewal options are at our sole discretion and were not included in the lease term for the calculation of the ROU assets and lease liabilities when the leases commenced as they were not reasonably certain of exercise. In addition to base rent, we also pay our proportionate share of the operating expenses, as defined in the leases. These payments are made monthly and adjusted annually to reflect actual charges incurred for operating expenses, such as common area maintenance, taxes, and insurance. The following table presents the lease balances within the consolidated balance sheets: December 31, 2022 2021 Right-of-use assets: Operating lease right-of-use asset $ 6,880 $ 7,919 Operating lease liabilities: Accrued liabilities 1,336 312 Operating lease liability, non-current portion 7,536 8,796 Total operating lease liabilities $ 8,872 $ 9,108 The cost components of our operating leases were as follows: Year Ended December 31, 2022 2021 2020 Operating lease cost $ 1,529 $ 1,125 $ 1,035 Variable lease cost 1,366 1,001 72 Total lease cost $ 2,895 $ 2,126 $ 1,107 Variable lease costs consist primarily of taxes, insurance and common area maintenance costs on our current corporate office leases. Maturities of our lease liability for our operating lease are as follows as of December 31, 2022: 2023 $ 1,777 2024 1,830 2025 1,885 2026 1,941 2027 1,998 Thereafter 843 Total undiscounted lease payments 10,274 Less: imputed interest (1,402) Present value of lease liability $ 8,872 As of December 31, 2022, the remaining lease term was 5.4 years and the weighted average discount rate was 5.3%. The operating cash outflows from our operating leases were $0.7 million, $0.1 million, and $1.0 million for the years ended December 31, 2022, 2021, and 2020, respectively.

Long-Term Debt

Long-Term Debt	12 Months Ended
	Dec. 31, 2022
Long-Term Debt, by Current and Noncurrent [Abstract]
Long-Term Debt	Long-Term Debt In March 2019, we amended our $24.5 million loan and security agreement, which we refer to as our former credit facility. The debt was interest only until April 1, 2022 and was scheduled to mature on March 1, 2024. The basic interest rate was the 30-day U.S. LIBOR rate, subject to a floor of 7.60%. In addition to the principal and interest payments, we were required to pay a final payment fee of 3.50% on all amounts outstanding, which was being accreted using the effective interest rate method over the term of the credit facility and was to be due at the earlier of maturity or prepayment. Borrowings were prepayable in whole at our option, subject to a prepayment fee of 1.00%. In August 2022, we prepaid the outstanding principal balance of $19.4 million, the final payment fee of $0.9 million, and the prepayment fee of $0.2 million. As of December 31, 2022, we had no remaining amounts outstanding under our former credit facility.

Employee Retirement Plan

Employee Retirement Plan	12 Months Ended
	Dec. 31, 2022
Retirement Benefits [Abstract]
Employee Retirement Plan	Employee Retirement PlanWe sponsor a defined contribution employee retirement plan covering all of our full-time employees. The plan allows for eligible employees to defer a portion of their eligible compensation up to the maximum allowed by IRS Regulations. Beginning January 1, 2022, we elected to begin making voluntary matching contributions to the plan. We match 50% of the first 6% of each participating employee's contribution, up to 3% of eligible earnings. Our match contributions are made to funds designated by the participant, none of which are based on Inspire common stock. Discretionary contributions to the plan totaled $2.4 million for the year ended December 31, 2022.

Stockholders' Equity and Stock-

Stockholders' Equity and Stock-Based Compensation	12 Months Ended
	Dec. 31, 2022
Share-Based Payment Arrangement [Abstract]
Stockholders' Equity and Stock-Based Compensation	7. Stock-Based Compensation As of December 31, 2022, there were 3,824,770 shares reserved for issuance under our equity incentive plan, of which 1,372,644 shares were available for issuance. Stock-based compensation expense is recognized on a straight-line basis over the vesting term for stock options and RSUs, and over the performance period based on the probability of achieving the performance objectives for PSUs, and is reduced by actual forfeitures as they occur. If there are any modifications or cancellations of the underlying unvested securities, we may be required to accelerate, increase, or cancel any remaining unearned stock compensation expense. Future stock-based compensation expense and unearned stock-based compensation will increase to the extent that we grant additional stock-based awards. Stock Options The stock options granted to employees include a four-year service period and 25% vest after the first year of service and the remainder vest in equal monthly installments over the next 36 months of service. The stock options granted to the board of directors vest in one three The fair value per share of options is estimated on the date of grant using the Black-Scholes option pricing model. Option Value and Assumptions Year Ended December 31, 2022 2021 2020 Weighted average fair value $121.43 $113.71 $73.93 Assumptions: Expected term (years) 5.50 - 6.25 5.50 - 6.25 5.50 - 6.25 Expected volatility 56.2% - 57.0% 54.9% - 55.9% 42.3% - 49.3% Risk-free interest rate 1.75% - 4.18% 0.79% - 1.44% 0.36% - 1.42% Expected dividend yield —% —% —% Expected Term — Due to our limited amount of historical exercise, forfeiture, and expiration activity, we have opted to use the "simplified method" for estimating the expected term of options, whereby the expected term equals the arithmetic average of the vesting terms and the original contractual term of the option. We will continue to analyze our expected term assumption as more historical data becomes available. Expected Volatility — Due to our limited company specific historical and implied volatility data, we have incorporated our historical stock trading volatility with those of a group of similar companies that are publicly traded for the calculation of volatility. When selecting this peer group of public companies on which we have based our expected stock price volatility, we generally selected companies with comparable characteristics, including enterprise value, stages of clinical development, risk profiles, position within the industry, and those with historical share price information sufficient to meet the expected life of the stock-based awards. We will continue to analyze the historical stock price volatility assumption as more historical data for our common stock becomes available. Risk-Free Interest Rate — The risk-free rate assumption is based on the U.S. government Treasury instruments with maturities similar to the expected term of our stock options. Expected Dividend Yield — The expected dividend assumption is based on our history of not paying dividends and our expectation that we will not declare dividends for the foreseeable future. Stock Option Activity Options Weighted Average Exercise Price Weighted average remaining contractual term (years) Aggregate intrinsic value (in thousands) Outstanding at December 31, 2019 2,844,164 $ 30.41 7.9 $ 124,585 Granted 703,838 $ 159.67 Exercised (624,315) $ 11.29 $ 54,821 Forfeited/expired (66,123) $ 44.57 Outstanding at December 31, 2020 2,857,564 $ 66.09 7.9 $ 351,626 Granted 228,302 $ 215.34 Exercised (323,860) $ 35.44 $ 58,360 Forfeited/expired (115,771) $ 118.85 Outstanding at December 31, 2021 2,646,235 $ 80.41 7.1 $ 397,015 Granted 500,148 $ 217.85 Exercised (416,602) $ 29.00 $ 73,036 Forfeited/expired (69,047) $ 161.48 Outstanding at December 31, 2022 2,660,734 $ 112.19 6.9 $ 372,068 Exercisable at December 31, 2022 1,651,692 $ 67.58 6.0 $ 304,506 The aggregate intrinsic value of options exercised is the difference between the estimated fair market value of our common stock at the date of exercise and the exercise price for those options. The aggregate intrinsic value of outstanding options is the difference between the closing price as of the date outstanding and the exercise price of the underlying stock options. The total grant date fair value of options vested during the year was $30.6 million, $23.9 million and $11.1 million for the years ended December 31, 2022, 2021, and 2020, respectively. As of December 31, 2022, the amount of unearned stock-based compensation currently estimated to be expensed from now through the year 2026 related to unvested stock options is $87.0 million which we expect to recognize over a weighted average period of 2.4 years. Restricted Stock Units RSUs are share awards that entitle the holder to receive freely tradable shares of our common stock upon vesting. The RSUs cannot be transferred and the awards are subject to forfeiture if the holder’s employment terminates prior to the release of the vesting restrictions. The RSUs include three Restricted Stock Units Weighted Average Aggregate Intrinsic Value (in thousands) Unvested at December 31, 2020 — $ — $ — Granted 2,275 $ 201.51 Unvested at December 31, 2021 2,275 $ 201.51 $ 524 Granted 130,463 $ 214.16 Vested (569) $ 201.51 $ 118 Forfeited (7,489) $ 214.40 Unvested at December 31, 2022 124,680 $ 213.97 $ 31,404 There were no RSUs granted prior to 2021. The aggregate intrinsic value of unvested RSUs was based on our closing stock price on the last trading day of the period. The aggregate intrinsic value of vested RSUs was based on our closing stock price on the date of vest. As of December 31, 2022, there was $21.3 million of unrecognized stock-based compensation expense related to RSUs to be recognized over a period of 2.4 years. Performance Stock Units During 2022, we granted PSUs to officers and key employees. The number of PSUs that will ultimately be earned is based on our performance relative to a pre-established goal for the three-year period ending December 31, 2024. The expense is recorded on a straight-line basis over the requisite service period based on an estimate of the number of PSUs expected to vest. Management expectations related to the achievement of the performance goal associated with PSU grants is assessed each reporting period. The number of shares earned at the end of the three-year period will vary based on actual performance, from 0% to 200% of the number of PSUs granted. If the performance condition is not met or not expected to be met, any compensation expense recognized associated with the grant will be reversed. A summary of PSUs and related information is as follows: Performance Stock Units Weighted Average Aggregate Intrinsic Value (in thousands) Unvested at December 31, 2021 — $ — $ — Granted 78,351 $ 227.53 Forfeited (879) $ 227.53 Unvested at December 31, 2022 77,472 $ 227.53 $ 19,514 There were no PSUs granted prior to 2022. The fair value of the PSUs is equal to the closing price of our common stock on the grant date. The aggregate intrinsic value of unvested PSUs was based on our closing stock price on the last trading day of the period. As of December 31, 2022, there was $23.2 million of unrecognized stock-based compensation expense related to outstanding PSUs that is expected to be recognized over a period of approximately 2.3 years. Employee Stock Purchase Plan Employees may participate in our ESPP provided they meet certain eligibility requirements. The purchase price for our common stock under the terms of the ESPP is defined as 85% of the lower of the closing market price per share of our common stock on the first or last trading day of a purchase period. We issued 23,709 shares under the ESPP during 2022 and there were 905,795 shares available for future issuance under the ESPP as of December 31, 2022.

Income Taxes

Income Taxes	12 Months Ended
	Dec. 31, 2022
Income Tax Disclosure [Abstract]
Income Taxes	Income TaxesDue to our cumulative net loss position, a valuation allowance has been required to be established for all deferred tax assets as of December 31, 2022, 2021, and 2020. The components of our provision for income taxes are as follows: December 31, 2022 2021 2020 Current United States $ 342 $ 23 $ 70 Foreign 271 49 45 Total current 613 72 115 Total provision for income taxes $ 613 $ 72 $ 115 The reconciliation of taxes at the federal statutory rate to our provision for income taxes are as follows: Year Ended December 31, 2022 2021 2020 Tax at federal statutory rate 21.0 % 21.0 % 21.0 % State, net of federal benefit 3.4 4.0 3.6 Stock-based compensation 9.1 18.1 8.0 Research and development ("R&D") tax credit 6.4 3.3 1.4 Other (0.8) 0.4 (0.1) Change in valuation allowance (40.5) (47.0) (34.1) Total (1.4) % (0.2) % (0.2) % Significant components of net deferred tax assets and liabilities were as follows: Year Ended December 31, 2022 2021 Deferred tax assets: Net operating losses $ 64,321 $ 71,445 R&D tax credits 9,626 6,257 R&D expenditures, capitalized for tax 14,230 1,505 Interest expense carryforward — 757 Accruals and other 3,302 2,092 Depreciation and amortization — 62 Lease liability 2,223 2,277 Stock-based compensation 12,439 4,543 Other comprehensive loss 44 14 Total deferred tax assets 106,185 88,952 Deferred tax liabilities: Depreciation (9) (59) Lease asset (1,724) (1,980) Total deferred tax liabilities (1,733) (2,039) Net deferred tax assets 104,452 86,913 Valuation allowance (104,452) (86,913) $ — $ — Deferred income taxes reflect the tax effects of net operating loss and tax credit carryforwards and the net temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. As of December 31, 2022, our gross federal net operating loss carryforwards of $257.4 million will expire at various dates beginning in 2033. In addition, net operating loss carryforwards for state income tax purposes of $183.3 million will begin to expire in 2024. We also have gross R&D credit carryforwards of $10.1 million as of December 31, 2022 which will expire at various dates beginning in 2033. Under the Tax Cuts and Jobs Act of 2017, R&D costs are no longer fully deductible and are required to be capitalized and amortized for U.S. tax purposes effective January 1, 2022. The mandatory capitalization requirement increased our deferred tax assets, which were fully offset by a valuation allowance. Utilization of the net operating loss carryforwards and R&D credit carryforwards may be subject to an annual limitation due to the ownership change limitations provided by Section 382 and Section 383 of the Internal Revenue Code of 1986 and similar state provisions. We are currently performing a detailed analysis to determine whether an ownership change has occurred and if a limitation exists. Based on the preliminary results of the analysis, we believe there is no evidence that this limitation would hinder the utilization of our net operating loss carryforwards or R&D credit carryforwards in the future. Realization of the deferred tax assets is dependent upon the generation of future taxable income, if any, the amount and timing of which are uncertain. Based on available objective evidence and cumulative losses, we believe it is more likely than not that the deferred tax assets are not recognizable and will not be recognizable until we have sufficient taxable income. Accordingly, the net deferred tax assets have been fully offset by a valuation allowance. The valuation allowance increased by $17.5 million and $19.8 million during the years ended December 31, 2022 and 2021, respectively. The changes to our gross unrecognized tax benefits were as follows: Year Ended December 31, 2022 2021 2020 Balance beginning of the year $ 134 $ 85 $ 40 Increase in balances related to current year tax positions 12 49 — Increase in balances related to prior year tax positions — — 45 Balance end of the year $ 146 $ 134 $ 85 We file income tax returns in the applicable jurisdictions. The 2019 to 2021 tax years remain open to examination by the major taxing authorities to which we are subject. We do not expect a significant change to our unrecognized tax benefits over the next 12 months. Our policy is to record interest related to uncertain tax positions as interest expense and any penalties as other expense in our consolidated statements of operations and comprehensive loss. There were no interest or penalties accrued as of December 31, 2022 and 2021.

Segment Reporting and Revenue D

Segment Reporting and Revenue Disaggregation	12 Months Ended
	Dec. 31, 2022
Segment Reporting [Abstract]
Segment Reporting and Revenue Disaggregation	Segment Reporting and Revenue DisaggregationWe operate our business as one operating segment. An operating segment is defined as a component of an enterprise for which separate discrete financial information is available and evaluated regularly by the chief operating decision maker, or decision-making group, in deciding how to allocate resources and in assessing performance. Segment information is consistent with how management reviews the business, makes investing and resource allocation decisions and assesses operating performance. We sell our Inspire system to hospitals and ambulatory surgery centers in the U.S. and in select countries in Europe through a direct sales organization, and in Japan and Singapore through distributors. Revenue by geographic region is as follows: Year Ended December 31, 2022 2021 2020 United States $ 394,833 $ 220,976 $ 106,108 All other countries 13,023 12,418 9,273 Total revenue $ 407,856 $ 233,394 $ 115,381 All of our long-lived assets are located in the U.S.

Loss Per Share

Loss Per Share	12 Months Ended
	Dec. 31, 2022
Earnings Per Share [Abstract]
Loss Per Share	Loss Per Share Basic net loss per share is computed by dividing the net loss by the weighted average number of shares of common stock outstanding during the period. Diluted net loss per share is computed by dividing the net loss by the weighted average number of shares of common stock and dilutive potential shares of common stock outstanding during the period. Because we have reported a net loss for all periods presented, diluted net loss per share is the same as basic net loss per share as all of the following potentially dilutive shares were antidilutive in those periods. The following common stock-based awards were excluded from the computation of diluted net loss per common share for the periods presented because including them would have been anti-dilutive: Year Ended December 31, 2022 2021 2020 Common stock options outstanding 2,660,734 2,646,235 2,857,564 Unvested restricted stock units 124,680 2,275 — Total 2,785,414 2,648,510 2,857,564

Summary of Significant Accoun_2

Summary of Significant Accounting Policies (Policies)	12 Months Ended
	Dec. 31, 2022
Accounting Policies [Abstract]
Basis of Presentation	Basis of Presentation The consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles ("U.S. GAAP") and pursuant to the rules and regulations of the Securities and Exchange Commission ("SEC").
Use of Estimates	Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts and disclosures reported in the consolidated financial statements. We use significant judgment when making estimates related to the allowance for credit losses, inventory reserves, warranty reserves, and stock-based awards. We base our estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results could differ from those estimates.
Cash and Cash Equivalents	Cash and Cash Equivalents We consider all highly liquid securities, readily convertible to cash, that have original maturities of 90 days or less from the date of purchase to be cash equivalents. The carrying amount reported in the consolidated balance sheets for cash is cost, which approximates fair value.
Foreign Currency	Foreign Currency Our functional and reporting currency is the U.S. dollar. Our subsidiary has a functional currency in Euro. The consolidated financial statements are translated to U.S. dollars. Non-monetary assets and liabilities denominated in foreign currencies are translated at rates of exchange in effect at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies are translated using the exchange rate prevailing at the balance sheet date. Sales and expenses denominated in foreign currencies are translated at exchange rates in effect on the date of the transaction. Foreign currency transaction gains and losses and the impacts of foreign currency remeasurement are recognized in other expense (income), net in the consolidated statements of operations and comprehensive loss. For the years ended December 31, 2022 and 2021, we recognized a total of $0.1 million and $0.2 million of gains, net, respectively. Any unrealized gains and losses due to translation adjustments are included in accumulated other comprehensive loss within stockholders' equity in the consolidated balance sheets. We had $0.1 million and $0 of unrecognized gain in our accumulated other comprehensive loss balance as of December 31, 2022 and 2021, respectively.
Investments	Investments At December 31, 2022 and 2021, our investments consisted of U.S. government securities. Investments are reported at their estimated fair market values which are based on quoted, active or inactive market prices when available. Any unrealized gains and losses due to interest rate fluctuations and other external factors are reported as a separate component of accumulated other comprehensive loss within stockholders' equity. We had $0.2 million and $0.1 million of unrecognized loss in our accumulated other comprehensive loss balance at December 31, 2022 and 2021, respectively. Any realized gains and losses are calculated on the specific identification method and reported net in other expense (income), net in the consolidated statements of operations and comprehensive loss. For both of the years ended December 31, 2022 and 2021, we recognized $0 of gains, net. We recognize expected credit losses on investments in accordance with Accounting Standards Update ("ASU"), ASU 2016-13, Financial Instruments - Credit Losses ("ASU 2016-13"), which we adopted effective January 1, 2020 using the modified retrospective approach. The adoption of ASU 2016-13 did not have a material impact on the amount and timing of credit losses recognized in our consolidated financial statements.
Fair Value of Financial Instruments	Fair Value of Financial Instruments We measure certain financial assets and liabilities at fair value on a recurring basis, including cash equivalents and investments. Fair value is an exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or a liability. A three-tier fair value hierarchy is established as a basis for considering such assumptions and for inputs used in the valuation methodologies in measuring fair value: Level 1: Observable inputs, such as quoted prices (unadjusted) for identical assets or liabilities in active markets. Level 2: Inputs other than quoted prices in active markets for identical assets and liabilities that are observable either directly or indirectly for substantially the full term of the asset or liability. Level 3: Unobservable inputs that are supported by little or no market activities, which would require us to develop our own assumptions. We use the methods and assumptions described below in determining the fair value of our financial instruments. Money market funds: Fair values of money market funds are based on quoted market prices in active markets. These are included as Level 1 measurements in the tables below. U.S. government securities: Consists of U.S. government Treasury bills with original maturities of less than two years and are based on quoted prices in active markets. These are included as a Level 1 measurement in the tables below. The following tables sets forth by level within the fair value hierarchy our assets that are measured on a recurring basis and reported at fair value as of December 31, 2022 and 2021. Assets are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. Fair Value Measurements as of December 31, 2022 Estimated Fair Value Level 1 Level 2 Level 3 Cash equivalents: Money market funds $ 390,846 $ 390,846 $ — $ — Total cash equivalents 390,846 390,846 — — Investments: U.S. government securities 9,821 9,821 — — Total investments 9,821 9,821 — — Total cash equivalents and investments $ 400,667 $ 400,667 $ — $ — Fair Value Measurements as of December 31, 2021 Estimated Fair Value Level 1 Level 2 Level 3 Cash equivalents: Money market funds $ 189,369 $ 189,369 $ — $ — Total cash equivalents 189,369 189,369 — — Investments: U.S. government securities 9,938 9,938 — — Total investments 9,938 9,938 — — Total cash equivalents and investments $ 199,307 $ 199,307 $ — $ — There were no transfers between levels during the years ended December 31, 2022 and 2021.
Concentration of Credit Risk	Concentration of Credit Risk Financial instruments, which potentially subject us to concentrations of credit risk, consist principally of cash equivalents, investments, and accounts receivable. Our investment policy limits investments to certain types of debt securities issued by the U.S. government and its agencies, corporations with investment-grade credit ratings, or commercial paper and money market funds issued by the highest quality financial and non-financial companies. We place restrictions on maturities and concentration by type and issuer. We are exposed to credit risk in the event of a default by the issuers of these securities to the extent recorded on the consolidated balance sheets. However, as of December 31, 2022 and 2021, 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 Losses	Accounts Receivable and Allowance for Expected Credit Losses Trade 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. 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).
Inventories	We regularly review inventory quantities on-hand for excess and obsolete inventory and, when circumstances indicate, incur charges to write down inventories to their net realizable value. The determination of a reserve for excess and obsolete inventory involves management exercising judgment to determine the required reserve, considering future demand, product life cycles, introduction of new products and current market conditions.
Property and Equipment	Depreciation is determined using the straight-line method over the estimated useful lives of the respective assets, generally three
Impairment of Long-lived Assets	Impairment of Long-lived AssetsLong-lived assets consist primarily of property and equipment and operating lease right-of-use asset and are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. If circumstances require that an asset be tested for possible impairment, we compare the undiscounted cash flows expected to be generated by the asset to the carrying amount of the asset. If the carrying amount of the asset is not recoverable on an undiscounted cash flow basis, we determine the fair value of the asset and recognize an impairment loss to the extent the carrying amount of the asset exceeds its fair value. We determine fair value using the income approach based on the present value of expected future cash flows or other appropriate measures of estimated fair value. Our cash flow assumptions consider historical and forecasted revenue and operating costs and other relevant factors. We did not record any impairment charges on long-lived assets during
Revenue Recognition	Revenue Recognition We 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 with outbound freight after control over a product has transferred to a customer are accounted for as a fulfillment cost and are included in cost of goods sold. Variable consideration related to certain customer sales incentives is estimated based on the amounts expected to be paid based on the agreement with the customer using probability assessments. We offer customers a limited right of return for our product in case of non-conformity or performance issues. We estimate the amount of our product sales that may be returned by our customers based on historical sales and
Cost of Goods Sold	Cost of Goods Sold Cost of goods sold consists primarily of acquisition costs for the components of the Inspire system, overhead costs, scrap and inventory obsolescence, warranty replacement costs, as well as distribution-related expenses such as logistics and shipping costs, net of shipping costs charged to customers. The overhead costs include the cost of material procurement, depreciation expense for production equipment, and operations supervision and management personnel, including employee compensation, stock-based compensation, supplies, and travel.
Research and Development	Research and Development Research and development expenses consist primarily of product development, clinical and regulatory affairs, quality assurance, consulting services, and other costs associated with products and technologies in development. These expenses include employee compensation, including stock-based compensation, supplies, materials, consulting, and travel expenses related to research and development programs. Clinical expenses include clinical study design, clinical site reimbursement, data management, travel expenses, and the cost of manufacturing products for clinical studies.
Stock-Based Compensation	Stock-Based Compensation We maintain an equity incentive plan to provide lon g-term incentives for eligible employees, consultants, and members of the board of directors. The plan allows for the issuance of restricted stock units ("RSUs"), performance stock units ("PSUs"), and non-statutory and incentive stock options to employees, and RSUs, PSUs, and non-statutory stock options to consultants and directors. We also offer an employee stock purchase plan ("ESPP") which allows participating employees to purchase shares of our common stock at a discount through payroll deductions. We recognize equity-based compensation expense for awards of equity instruments based on the grant date fair value of those awards as expense in the consolidated statements of operations and comprehensive loss. We estimate the fair value of stock options using the Black-Scholes option pricing model and the fair value of RSUs and PSUs is equal to the closing price of our common stock on the grant date. The fair value of each purchase under the employee stock purchase plan is estimated at the beginning of the offering period using the Black-Scholes option pricing model. Stock-based compensation expense is recognized on a straight-line basis over the vesting term for stock options and RSUs, and over the vesting and performance period based on the probability of achieving the performance objectives for PSUs. We account for award forfeitures as they occur.
Advertising Expenses	Advertising ExpensesWe expense the costs of advertising, including promotional expenses, as incurred.
Leases	Leases Operating leases are included in operating lease right-of-use ("ROU") asset, accrued expenses, and operating lease liability – non-current portion in our consolidated balance sheets. ROU assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are recognized at the lease commencement date based on the present value of lease payments over the lease term. In determining the present value of lease payments,
Income Taxes	Income Taxes We account for income taxes using the liability method. Under this method, deferred tax assets and liabilities are determined based on the differences between the financial reporting and tax bases of assets and liabilities and are measured using the enacted tax rates that will be in effect when the differences are expected to reverse. Valuation allowances against deferred tax assets are established, when necessary, to reduce deferred tax assets to the amounts expected to be realized. As we have historically incurred operating losses, we have recorded a full valuation allowance against our net deferred tax assets, and there is no provision for income taxes other than minimal state and foreign taxes, which includes a foreign tax provision relating to uncertain tax positions. Our policy is to record interest and penalties expense related to uncertain tax positions as other expense in the consolidated statements of operations and comprehensive loss.
Comprehensive Loss	Comprehensive Loss Comprehensive loss consists of net loss and changes in unrealized gains and losses due to interest rate fluctuations and other external factors on investments classified as available-for-sale, and foreign currency translation adjustments. Accumulated other comprehensive loss is presented in the accompanying consolidated balance sheets as a component of stockholders' equity.
Loss Per Share	Loss Per Share Basic net loss per share is computed by dividing the net loss by the weighted average number of shares of common stock outstanding during the period. Diluted net loss per share is computed by dividing the net loss by the weighted average number of shares of common stock and dilutive potential shares of common stock outstanding during the period. Because we have reported a net loss for all periods presented, diluted net loss per share is the same as basic net loss per share as all potentially dilutive shares consisting of outstanding stock options, unvested RSUs and PSUs, and shares issuable under our employee stock purchase plan were antidilutive in those periods.
Recent Accounting Pronouncements	Recent Accounting Pronouncements We have reviewed and considered all recent accounting pronouncements that have not yet been adopted and believe there are none that could potentially have a material impact on our business practices, financial condition, results of operations, or disclosures.

Summary of Significant Accoun_3

Summary of Significant Accounting Policies (Tables)	12 Months Ended
	Dec. 31, 2022
Accounting Policies [Abstract]
Schedule of assets and liabilities measured at fair value on a recurring basis	The following tables sets forth by level within the fair value hierarchy our assets that are measured on a recurring basis and reported at fair value as of December 31, 2022 and 2021. Assets are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. Fair Value Measurements as of December 31, 2022 Estimated Fair Value Level 1 Level 2 Level 3 Cash equivalents: Money market funds $ 390,846 $ 390,846 $ — $ — Total cash equivalents 390,846 390,846 — — Investments: U.S. government securities 9,821 9,821 — — Total investments 9,821 9,821 — — Total cash equivalents and investments $ 400,667 $ 400,667 $ — $ — Fair Value Measurements as of December 31, 2021 Estimated Fair Value Level 1 Level 2 Level 3 Cash equivalents: Money market funds $ 189,369 $ 189,369 $ — $ — Total cash equivalents 189,369 189,369 — — Investments: U.S. government securities 9,938 9,938 — — Total investments 9,938 9,938 — — Total cash equivalents and investments $ 199,307 $ 199,307 $ — $ —
Schedule of inventory	Inventories are valued at the lower of cost or net realizable value, computed on a first-in, first-out basis, and consisted of the following: December 31, 2022 2021 Raw materials $ 5,645 $ 3,119 Finished goods 6,241 14,112 Total inventories, net of reserves $ 11,886 $ 17,231
Schedule of property and equipment	Property and equipment are stated at cost, less accumulated depreciation and amortization and consisted of the following: December 31, 2022 2021 Computer equipment and software $ 1,729 $ 1,397 Manufacturing equipment 5,974 4,436 Other equipment 535 249 Leasehold improvements 2,064 281 Construction in process 11,857 5,175 Property and equipment, cost 22,159 11,538 Less: accumulated depreciation and amortization (4,910) (3,052) Property and equipment, net $ 17,249 $ 8,486
Schedule of accrued expenses	Accrued expenses consisted of the following: December 31, 2022 2021 Payroll related $ 30,398 $ 17,655 Interest — 160 Product warranty liability 920 468 Operating lease liabilities, current portion 1,336 312 Other accrued expenses 1,685 1,859 Total accrued expenses $ 34,339 $ 20,454
Schedule of estimated product warranty liability accrual	The following table shows the changes in our estimated product warranty liability accrual, included in accrued liabilities: Year Ended December 31, 2022 2021 2020 Balance at beginning of period $ 468 $ 159 $ 115 Provisions for warranty 798 576 137 Settlements of warranty claims (346) (267) (93) Balance at the end of the period $ 920 $ 468 $ 159

Investments (Tables)

Investments (Tables)	12 Months Ended
	Dec. 31, 2022
Investments, Debt and Equity Securities [Abstract]
Investments available-for-sale	Our investments are classified as available-for-sale and consist of the following: December 31, 2022 Amortized Unrealized Gross Aggregate Cost Gains Losses Fair Value Short-Term: U.S. government securities $ 9,998 $ — $ (177) $ 9,821 Short-term investments $ 9,998 $ — $ (177) $ 9,821 December 31, 2021 Amortized Unrealized Gross Aggregate Cost Gains Losses Fair Value Long-Term: U.S. government securities $ 9,993 $ — $ (55) $ 9,938 Long-term investments $ 9,993 $ — $ (55) $ 9,938

Leases (Tables)

Leases (Tables)	12 Months Ended
	Dec. 31, 2022
Leases [Abstract]
Assets and liabilities, lessee	The following table presents the lease balances within the consolidated balance sheets: December 31, 2022 2021 Right-of-use assets: Operating lease right-of-use asset $ 6,880 $ 7,919 Operating lease liabilities: Accrued liabilities 1,336 312 Operating lease liability, non-current portion 7,536 8,796 Total operating lease liabilities $ 8,872 $ 9,108
Components of lease expense	The cost components of our operating leases were as follows: Year Ended December 31, 2022 2021 2020 Operating lease cost $ 1,529 $ 1,125 $ 1,035 Variable lease cost 1,366 1,001 72 Total lease cost $ 2,895 $ 2,126 $ 1,107
Operating lease maturities	Maturities of our lease liability for our operating lease are as follows as of December 31, 2022: 2023 $ 1,777 2024 1,830 2025 1,885 2026 1,941 2027 1,998 Thereafter 843 Total undiscounted lease payments 10,274 Less: imputed interest (1,402) Present value of lease liability $ 8,872

Stockholders' Equity and Stoc_2

Stockholders' Equity and Stock-Based Compensation (Tables)	12 Months Ended
	Dec. 31, 2022
Share-Based Payment Arrangement [Abstract]
Summary of weighted average assumptions for fair value of options granted	Option Value and Assumptions Year Ended December 31, 2022 2021 2020 Weighted average fair value $121.43 $113.71 $73.93 Assumptions: Expected term (years) 5.50 - 6.25 5.50 - 6.25 5.50 - 6.25 Expected volatility 56.2% - 57.0% 54.9% - 55.9% 42.3% - 49.3% Risk-free interest rate 1.75% - 4.18% 0.79% - 1.44% 0.36% - 1.42% Expected dividend yield —% —% —%
Summary of stock option activity and related information	Stock Option Activity Options Weighted Average Exercise Price Weighted average remaining contractual term (years) Aggregate intrinsic value (in thousands) Outstanding at December 31, 2019 2,844,164 $ 30.41 7.9 $ 124,585 Granted 703,838 $ 159.67 Exercised (624,315) $ 11.29 $ 54,821 Forfeited/expired (66,123) $ 44.57 Outstanding at December 31, 2020 2,857,564 $ 66.09 7.9 $ 351,626 Granted 228,302 $ 215.34 Exercised (323,860) $ 35.44 $ 58,360 Forfeited/expired (115,771) $ 118.85 Outstanding at December 31, 2021 2,646,235 $ 80.41 7.1 $ 397,015 Granted 500,148 $ 217.85 Exercised (416,602) $ 29.00 $ 73,036 Forfeited/expired (69,047) $ 161.48 Outstanding at December 31, 2022 2,660,734 $ 112.19 6.9 $ 372,068 Exercisable at December 31, 2022 1,651,692 $ 67.58 6.0 $ 304,506
Summary of RSUs and related information	A summary of RSUs and related information is as follows: Restricted Stock Units Weighted Average Aggregate Intrinsic Value (in thousands) Unvested at December 31, 2020 — $ — $ — Granted 2,275 $ 201.51 Unvested at December 31, 2021 2,275 $ 201.51 $ 524 Granted 130,463 $ 214.16 Vested (569) $ 201.51 $ 118 Forfeited (7,489) $ 214.40 Unvested at December 31, 2022 124,680 $ 213.97 $ 31,404
Summary of PSUs and related information	A summary of PSUs and related information is as follows: Performance Stock Units Weighted Average Aggregate Intrinsic Value (in thousands) Unvested at December 31, 2021 — $ — $ — Granted 78,351 $ 227.53 Forfeited (879) $ 227.53 Unvested at December 31, 2022 77,472 $ 227.53 $ 19,514

Income Taxes (Tables)

Income Taxes (Tables)	12 Months Ended
	Dec. 31, 2022
Income Tax Disclosure [Abstract]
Schedule of components of income tax provisions	The components of our provision for income taxes are as follows: December 31, 2022 2021 2020 Current United States $ 342 $ 23 $ 70 Foreign 271 49 45 Total current 613 72 115 Total provision for income taxes $ 613 $ 72 $ 115
Schedule of income tax rate reconciliation components	The reconciliation of taxes at the federal statutory rate to our provision for income taxes are as follows: Year Ended December 31, 2022 2021 2020 Tax at federal statutory rate 21.0 % 21.0 % 21.0 % State, net of federal benefit 3.4 4.0 3.6 Stock-based compensation 9.1 18.1 8.0 Research and development ("R&D") tax credit 6.4 3.3 1.4 Other (0.8) 0.4 (0.1) Change in valuation allowance (40.5) (47.0) (34.1) Total (1.4) % (0.2) % (0.2) %
Schedule of deferred tax assets and liabilities	Significant components of net deferred tax assets and liabilities were as follows: Year Ended December 31, 2022 2021 Deferred tax assets: Net operating losses $ 64,321 $ 71,445 R&D tax credits 9,626 6,257 R&D expenditures, capitalized for tax 14,230 1,505 Interest expense carryforward — 757 Accruals and other 3,302 2,092 Depreciation and amortization — 62 Lease liability 2,223 2,277 Stock-based compensation 12,439 4,543 Other comprehensive loss 44 14 Total deferred tax assets 106,185 88,952 Deferred tax liabilities: Depreciation (9) (59) Lease asset (1,724) (1,980) Total deferred tax liabilities (1,733) (2,039) Net deferred tax assets 104,452 86,913 Valuation allowance (104,452) (86,913) $ — $ —
Schedule of changes to gross unrecognized tax benefits	The changes to our gross unrecognized tax benefits were as follows: Year Ended December 31, 2022 2021 2020 Balance beginning of the year $ 134 $ 85 $ 40 Increase in balances related to current year tax positions 12 49 — Increase in balances related to prior year tax positions — — 45 Balance end of the year $ 146 $ 134 $ 85

Segment Reporting and Revenue_2

Segment Reporting and Revenue Disaggregation (Tables)	12 Months Ended
	Dec. 31, 2022
Segment Reporting [Abstract]
Schedule of revenue by geographic region	Revenue by geographic region is as follows: Year Ended December 31, 2022 2021 2020 United States $ 394,833 $ 220,976 $ 106,108 All other countries 13,023 12,418 9,273 Total revenue $ 407,856 $ 233,394 $ 115,381

Loss Per Share (Tables)

Loss Per Share (Tables)	12 Months Ended
	Dec. 31, 2022
Earnings Per Share [Abstract]
Schedule of dilutive securities excluded from computations of diluted weighted average shares outstanding	Year Ended December 31, 2022 2021 2020 Common stock options outstanding 2,660,734 2,646,235 2,857,564 Unvested restricted stock units 124,680 2,275 — Total 2,785,414 2,648,510 2,857,564

Summary of Significant Accoun_4

Summary of Significant Accounting Policies - Follow-On Public Offering (Details) - Follow-on Offering $ / shares in Units, $ in Millions	1 Months Ended
	Aug. 31, 2022 USD ($) $ / shares shares
Subsidiary, Sale of Stock [Line Items]
Shares sold (in shares) | shares	1,150,000
Shares sold, price (in dollars per share) | $ / shares	$ 215
Shares sold, net proceeds | $	$ 243.8

Summary of Significant Accoun_5

Summary of Significant Accounting Policies - Foreign Currency (Details) - USD ($)	12 Months Ended
	Dec. 31, 2022	Dec. 31, 2021
Accounting Policies [Abstract]
Foreign currency gains	$ 100,000	$ 200,000
Foreign Currency gains included in accumulated other comprehensive loss	$ 100,000	$ 0

Summary of Significant Accoun_6

Summary of Significant Accounting Policies - Investments (Details) - USD ($)	12 Months Ended
	Dec. 31, 2022	Dec. 31, 2021
Accounting Policies [Abstract]
Unrecognized loss (gain) in accumulated other comprehensive loss (income)	$ (200,000)	$ (100,000)
Realized gains	0	0
Allowance for credit losses	$ 0	$ 0

Summary of Significant Accoun_7

Summary of Significant Accounting Policies - Fair Value of Financial Instruments (Details) - Recurring basis - USD ($) $ in Thousands	Dec. 31, 2022	Dec. 31, 2021
Cash equivalents:
Total cash equivalents	$ 390,846	$ 189,369
Short-term Investments [Abstract]
Total investments	9,821	9,938
Total cash equivalents and investments	400,667	199,307
U.S. government securities
Short-term Investments [Abstract]
Total investments	9,821	9,938
Money market funds
Cash equivalents:
Total cash equivalents	390,846	189,369
Level 1
Cash equivalents:
Total cash equivalents	390,846	189,369
Short-term Investments [Abstract]
Total investments	9,821	9,938
Total cash equivalents and investments	400,667	199,307
Level 1 | U.S. government securities
Short-term Investments [Abstract]
Total investments	9,821	9,938
Level 1 | Money market funds
Cash equivalents:
Total cash equivalents	390,846	189,369
Level 2
Cash equivalents:
Total cash equivalents	0	0
Short-term Investments [Abstract]
Total investments	0	0
Total cash equivalents and investments	0	0
Level 2 | U.S. government securities
Short-term Investments [Abstract]
Total investments	0	0
Level 2 | Money market funds
Cash equivalents:
Total cash equivalents	0	0
Level 3
Cash equivalents:
Total cash equivalents	0	0
Short-term Investments [Abstract]
Total investments	0	0
Total cash equivalents and investments	0	0
Level 3 | U.S. government securities
Short-term Investments [Abstract]
Total investments	0	0
Level 3 | Money market funds
Cash equivalents:
Total cash equivalents	$ 0	$ 0

Summary of Significant Accoun_8

Summary of Significant Accounting Policies - Inventories (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2022	Dec. 31, 2021
Accounting Policies [Abstract]
Raw materials	$ 5,645	$ 3,119
Finished goods	6,241	14,112
Total inventories, net of reserves	11,886	17,231
Inventory reserve related to product introductions	1,800
Reserve for excess and obsolete inventory	$ 2,700	$ 300

Summary of Significant Accoun_9

Summary of Significant Accounting Policies - Property and Equipment (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2022	Dec. 31, 2021	Dec. 31, 2020
Property and Equipment
Property and equipment, gross	$ 22,159	$ 11,538
Less: accumulated depreciation and amortization	(4,910)	(3,052)
Property and equipment, net	17,249	8,486
Depreciation and amortization expenses	1,900	1,200	$ 800
Computer equipment and software
Property and Equipment
Property and equipment, gross	1,729	1,397
Manufacturing equipment
Property and Equipment
Property and equipment, gross	5,974	4,436
Other equipment
Property and Equipment
Property and equipment, gross	535	249
Leasehold improvements
Property and Equipment
Property and equipment, gross	2,064	281
Construction in process
Property and Equipment
Property and equipment, gross	$ 11,857	$ 5,175
Minimum
Property and Equipment
Estimated useful lives	3 years
Maximum
Property and Equipment
Estimated useful lives	5 years

Summary of Significant Accou_10

Summary of Significant Accounting Policies - Strategic Investments (Details) - USD ($) $ in Millions	Dec. 31, 2022	Dec. 31, 2021
Accounting Policies [Abstract]
Equity securities without readily determinable fair value	$ 10.5	$ 0

Summary of Significant Accou_11

Summary of Significant Accounting Policies - Accrued Expenses (Details) - USD ($) $ in Thousands	Dec. 31, 2022	Dec. 31, 2021
Accounting Policies [Abstract]
Payroll related	$ 30,398	$ 17,655
Interest	0	160
Product warranty liability	920	468
Operating lease liabilities, current portion	1,336	312
Other accrued expenses	1,685	1,859
Total accrued expenses	$ 34,339	$ 20,454

Summary of Significant Accou_12

Summary of Significant Accounting Policies - Estimated Product Warranty Accrual (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2022	Dec. 31, 2021	Dec. 31, 2020
Accounting Policies [Abstract]
Balance at beginning of period	$ 468	$ 159	$ 115
Provisions for warranty	798	576	137
Settlements of warranty claims	(346)	(267)	(93)
Balance at the end of the period	$ 920	$ 468	$ 159

Summary of Significant Accou_13

Summary of Significant Accounting Policies - Advertising Expenses (Details) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2022	Dec. 31, 2021	Dec. 31, 2020
Advertising Expenses
Advertising expenses	$ 74.3	$ 47.8	$ 26.4

Summary of Significant Accou_14

Summary of Significant Accounting Policies - Purchase Commitments (Details) $ in Millions	Dec. 31, 2022 USD ($)
Accounting Policies [Abstract]
Commitments to suppliers for inventory purchases	$ 157.4

Investments - Summary (Details)

Investments - Summary (Details) - USD ($)	Dec. 31, 2022	Dec. 31, 2021
Short-Term:
Amortized Cost	$ 9,998,000
Aggregate Fair Value	9,821,000
Long-Term:
Amortized Cost		$ 9,993,000
Aggregate Fair Value	0	9,938,000
Short-term
Short-Term:
Unrealized gross gains	0
Unrealized gross losses	(177,000)
Long-Term:
Unrealized gross gains	0
Unrealized gross losses	(177,000)
Long-Term
Short-Term:
Unrealized gross gains		0
Unrealized gross losses		(55,000)
Long-Term:
Unrealized gross gains		0
Unrealized gross losses		(55,000)
U.S. government securities
Short-Term:
Amortized Cost	9,998,000
Aggregate Fair Value	9,821,000
Long-Term:
Amortized Cost		9,993,000
Aggregate Fair Value		9,938,000
U.S. government securities | Short-term
Short-Term:
Unrealized gross gains	0
Unrealized gross losses	(177,000)
Long-Term:
Unrealized gross gains	0
Unrealized gross losses	$ (177,000)
U.S. government securities | Long-Term
Short-Term:
Unrealized gross gains		0
Unrealized gross losses		(55,000)
Long-Term:
Unrealized gross gains		0
Unrealized gross losses		$ (55,000)

Investments - Narrative (Detail

Investments - Narrative (Details) - USD ($)	Dec. 31, 2022	Dec. 31, 2021
Investments, Debt and Equity Securities [Abstract]
Investments with maturity greater than two years	$ 0	$ 9,938,000

Leases - Narrative (Details)

Leases - Narrative (Details) ft² in Thousands, $ in Millions	1 Months Ended	12 Months Ended
	Aug. 31, 2021 renewal_option	Dec. 31, 2022 USD ($) ft²	Dec. 31, 2021 USD ($)	Dec. 31, 2020 USD ($)	May 31, 2019
Lessee, Lease, Description [Line Items]
Operating lease sublease land agreement (in square feet) | ft²		70
Number of renewal options | renewal_option	1
Remaining lease terms, in years		5 years 4 months 24 days
Remaining lease terms, discount rate		5.30%
Operating lease payments | $		$ 0.7	$ 0.1	$ 1
Office Space Sublease
Lessee, Lease, Description [Line Items]
Lease renewal term					5 years

Leases - Assets and Liabilities

Leases - Assets and Liabilities (Details) - USD ($) $ in Thousands	Dec. 31, 2022	Dec. 31, 2021
Assets
Operating lease right-of-use assets	$ 6,880	$ 7,919
Operating lease liabilities:
Accrued liabilities	1,336	312
Operating lease liabilities, non-current portion	7,536	8,796
Total operating lease liabilities	$ 8,872	$ 9,108

Leases - Components of Lease Ex

Leases - Components of Lease Expense (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2022	Dec. 31, 2021	Dec. 31, 2020
Leases [Abstract]
Operating lease cost	$ 1,529	$ 1,125	$ 1,035
Variable lease cost	1,366	1,001	72
Total lease cost	$ 2,895	$ 2,126	$ 1,107

Leases - Operating Lease Maturi

Leases - Operating Lease Maturities (Details) - USD ($) $ in Thousands	Dec. 31, 2022	Dec. 31, 2021
Leases [Abstract]
2023	$ 1,777
2024	1,830
2025	1,885
2026	1,941
2027	1,998
Thereafter	843
Total undiscounted lease payments	10,274
Less: imputed interest	(1,402)
Present value of lease liability	$ 8,872	$ 9,108

Long-Term Debt (Details)

Long-Term Debt (Details) - Term A loan facility - March 2019 Amendment to Loan and Security Agreement - USD ($)	1 Months Ended
	Aug. 31, 2022	Mar. 31, 2019	Dec. 31, 2022
Credit Facility
Maximum borrowing amount under credit facility		$ 24,500,000
Final payment percentage		3.50%
Prepayment of outstanding principal	$ 19,400,000
Payment for final fee	900,000
Prepayment fee	$ 200,000
Outstanding under credit facility			$ 0
Minimum
Credit Facility
Basic interest rate		7.60%
Prepayment fee		1%

Employee Retirement Plan (Detai

Employee Retirement Plan (Details) $ in Millions	12 Months Ended
	Dec. 31, 2022 USD ($)
Retirement Benefits [Abstract]
Employer matching contribution, percent of employee's contribution	50%
Maximum contributions per employee, percent	6%
Employer matching contribution, percent of employees' earnings	3%
Employer discretionary contribution	$ 2.4

Stockholders' Equity and Stoc_3

Stockholders' Equity and Stock-Based Compensation - Additional Information (Details) $ in Thousands	12 Months Ended
	Dec. 31, 2022 USD ($) renewal_option shares	Dec. 31, 2021 USD ($)	Dec. 31, 2020 USD ($)
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Fair value of options vested	$ 30,600	$ 23,900	$ 11,100
Unearned stock-based compensation	$ 87,000
Common stock options outstanding
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Service period	4 years
Contractual life of stock options	10 years
Weighted average recognition period	2 years 4 months 24 days
Common stock options outstanding | Directors | Minimum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Service period	1 year
Common stock options outstanding | Directors | Maximum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Service period	3 years
Common stock options outstanding | Vesting after first year of service
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Percentage of shares to vest	25%
Common stock options outstanding | Vesting in three years
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting period	36 months
Restricted Stock Units
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Weighted average recognition period	2 years 4 months 24 days
Number of grant date anniversaries for vesting | renewal_option	4
Unrecognized stock-based compensation expense	$ 21,300
Restricted Stock Units | Minimum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Service period	3 years
Restricted Stock Units | Maximum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Service period	4 years
Equity Incentive Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of shares reserved for issuance (in shares) | shares	3,824,770
Number of shares available for issuance (in shares) | shares	1,372,644

Stockholders' Equity and Stoc_4

Stockholders' Equity and Stock-Based Compensation - Assumptions Used to Calculate Fair Value of Options (Details) - Common stock options outstanding - $ / shares	12 Months Ended
	Dec. 31, 2022	Dec. 31, 2021	Dec. 31, 2020
Weighted average assumptions
Weighted average fair value (in dollars per share)	$ 121.43	$ 113.71	$ 73.93
Dividend yield	0%	0%	0%
Minimum
Weighted average assumptions
Expected term (in years)	5 years 6 months	5 years 6 months	5 years 6 months
Expected volatility	56.20%	54.90%	42.30%
Risk-free interest rate	1.75%	0.79%	0.36%
Maximum
Weighted average assumptions
Expected term (in years)	6 years 3 months	6 years 3 months	6 years 3 months
Expected volatility	57%	55.90%	49.30%
Risk-free interest rate	4.18%	1.44%	1.42%

Stockholders' Equity and Stoc_5

Stockholders' Equity and Stock-Based Compensation - Stock Option Activity (Details) - USD ($) $ / shares in Units, $ in Thousands	12 Months Ended
	Dec. 31, 2022	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Options
Outstanding at beginning of the year (in shares)	2,646,235	2,857,564	2,844,164
Granted (in shares)	500,148	228,302	703,838
Exercised (in shares)	(416,602)	(323,860)	(624,315)
Forfeited/expired (in shares)	(69,047)	(115,771)	(66,123)
Outstanding at ending of the year (in shares)	2,660,734	2,646,235	2,857,564	2,844,164
Exercisable (in shares)	1,651,692
Weighted Average Exercise Price
Outstanding, beginning of the period (in dollars per share)	$ 80.41	$ 66.09	$ 30.41
Granted (in dollars per share)	217.85	215.34	159.67
Exercised (in dollars per share)	29	35.44	11.29
Forfeited/expired (in dollars per share)	161.48	118.85	44.57
Outstanding, end of the period (in dollars per share)	112.19	$ 80.41	$ 66.09	$ 30.41
Exercisable (in dollars per share)	$ 67.58
Weighted average remaining contractual term
Outstanding (in years)	6 years 10 months 24 days	7 years 1 month 6 days	7 years 10 months 24 days	7 years 10 months 24 days
Exercisable (in years)	6 years
Aggregate intrinsic value
Outstanding, beginning of period	$ 397,015	$ 351,626	$ 124,585
Exercised	73,036	58,360	54,821
Outstanding, end of period	372,068	$ 397,015	$ 351,626	$ 124,585
Exercisable	$ 304,506

Stockholders' Equity and Stoc_6

Stockholders' Equity and Stock-Based Compensation - Restricted Stock Units (Details) - USD ($) $ / shares in Units, $ in Thousands	12 Months Ended
	Dec. 31, 2022	Dec. 31, 2021	Dec. 31, 2020
Restricted Stock Units
Forfeited (in shares)	(879)
Weighted Average Grant Date Fair Value
Forfeited (in dollars per share)	$ 227.53
Restricted Stock Units
Restricted Stock Units
Unvested at Beginning of period (in shares)	2,275	0
Granted (in shares)		130,463	2,275
Vested (in shares)		(569)
Forfeited (in shares)	(7,489)
Unvested at End of period (in shares)	124,680	2,275	0
Weighted Average Grant Date Fair Value
Unvested at Beginning of period (in dollars per share)	$ 201.51	$ 0
Granted (in dollars per share)		214.16	$ 201.51
Vested (in dollars per share)		201.51
Forfeited (in dollars per share)	214.40
Unvested at End of Period (in dollars per share)	$ 213.97	$ 201.51	$ 0
Aggregate intrinsic value
Unvested, Beginning of period	$ 524	$ 0
Vested		118
Unvested , End of period	$ 31,404	$ 524	$ 0

Stock-Based Compensation - Perf

Stock-Based Compensation - Performance Stock Units (Details) $ / shares in Units, $ in Thousands	12 Months Ended
	Dec. 31, 2022 USD ($) $ / shares shares
Restricted Stock Units
Forfeited (in shares) | shares	(879)
Weighted Average Grant Date Fair Value
Forfeited (in dollars per share) | $ / shares	$ 227.53
Aggregate intrinsic value
Unearned stock-based compensation | $	$ 87,000
Minimum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Performance target, percentage	0%
Maximum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Performance target, percentage	200%
Performance stock units
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Revenue goal, performance period	3 years
Restricted Stock Units
Unvested at Beginning of period (in shares) | shares	0
Granted (in shares) | shares	78,351
Unvested at End of period (in shares) | shares	77,472
Weighted Average Grant Date Fair Value
Unvested at Beginning of period (in dollars per share) | $ / shares	$ 0
Granted (in dollars per share) | $ / shares	227.53
Unvested at End of Period (in dollars per share) | $ / shares	$ 227.53
Aggregate intrinsic value
Unvested, Beginning of period | $	$ 0
Unvested , End of period | $	19,514
Unearned stock-based compensation | $	$ 23,200
Weighted average recognition period	2 years 3 months 18 days

Stock-Based Compensation - Empl

Stock-Based Compensation - Employee Stock Purchase Plan (Details) - Employee Stock Purchase Plan	12 Months Ended
	Dec. 31, 2022 shares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Employee stock purchase plan, percent	85%
Issuance of common stock for employee stock purchase plan (in shares)	23,709
Number of shares reserved for issuance (in shares)	905,795

Income Taxes - Income Tax Provi

Income Taxes - Income Tax Provision (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2022	Dec. 31, 2021	Dec. 31, 2020
Current
United States	$ 342	$ 23	$ 70
Foreign	271	49	45
Total current	613	72	115
Total provision for income taxes	$ 613	$ 72	$ 115

Income Taxes - Tax Reconciliati

Income Taxes - Tax Reconciliation (Details)	12 Months Ended
	Dec. 31, 2022	Dec. 31, 2021	Dec. 31, 2020
Income Tax Disclosure [Abstract]
Tax at federal statutory rate	21%	21%	21%
State, net of federal benefit	3.40%	4%	3.60%
Stock-based compensation	9.10%	18.10%	8%
Research and development ("R&D") tax credit	6.40%	3.30%	1.40%
Other	(0.80%)	0.40%	(0.10%)
Change in valuation allowance	(40.50%)	(47.00%)	(34.10%)
Total	(1.40%)	(0.20%)	(0.20%)

Income Taxes - Deferred Tax Ass

Income Taxes - Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Thousands	Dec. 31, 2022	Dec. 31, 2021
Deferred tax assets:
Net operating losses	$ 64,321	$ 71,445
R&D tax credits	9,626	6,257
R&D expenditures, capitalized for tax	14,230	1,505
Interest expense carryforward	0	757
Accruals and other	3,302	2,092
Depreciation and amortization	0	62
Lease liability	2,223	2,277
Stock-based compensation	12,439	4,543
Other comprehensive loss	44	14
Total deferred tax assets	106,185	88,952
Deferred tax liabilities:
Depreciation	(9)	(59)
Lease asset	(1,724)	(1,980)
Total deferred tax liabilities	(1,733)	(2,039)
Net deferred tax assets	104,452	86,913
Valuation allowance	(104,452)	(86,913)
Deferred tax assets, net	$ 0	$ 0

Income Taxes - Narrative (Detai

Income Taxes - Narrative (Details) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2022	Dec. 31, 2021
Operating Loss Carryforwards [Line Items]
Valuation allowance increase	$ 17.5	$ 19.8
R&D credit
Operating Loss Carryforwards [Line Items]
Credit carryforwards	10.1
Federal
Operating Loss Carryforwards [Line Items]
Net operating loss carryforwards	257.4
State
Operating Loss Carryforwards [Line Items]
Net operating loss carryforwards	$ 183.3

Income Taxes - Unrecognized Tax

Income Taxes - Unrecognized Tax Benefits (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2022	Dec. 31, 2021	Dec. 31, 2020
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns [Roll Forward]
Balance beginning of the year	$ 134	$ 85	$ 40
Increase in balances related to current year tax positions	12	49	0
Increase in balances related to prior year tax positions	0	0	45
Balance end of the year	$ 146	$ 134	$ 85

Segment Reporting and Revenue_3

Segment Reporting and Revenue Disaggregation (Details) $ in Thousands	12 Months Ended
	Dec. 31, 2022 USD ($) segment	Dec. 31, 2021 USD ($)	Dec. 31, 2020 USD ($)
Segment Reporting and Significant Customers
Number of operating segments | segment	1
Revenue	$ 407,856	$ 233,394	$ 115,381
United States
Segment Reporting and Significant Customers
Revenue	394,833	220,976	106,108
All other countries
Segment Reporting and Significant Customers
Revenue	$ 13,023	$ 12,418	$ 9,273

Loss Per Share (Details)

Loss Per Share (Details) - shares	12 Months Ended
	Dec. 31, 2022	Dec. 31, 2021	Dec. 31, 2020
Loss Per Share
Antidilutive securities excluded from computation of diluted weighted average shares outstanding (in shares)	2,785,414	2,648,510	2,857,564
Common stock options outstanding
Loss Per Share
Antidilutive securities excluded from computation of diluted weighted average shares outstanding (in shares)	2,660,734	2,646,235	2,857,564
Unvested restricted stock units
Loss Per Share
Antidilutive securities excluded from computation of diluted weighted average shares outstanding (in shares)	124,680	2,275	0