Operator: Thank you. And our next question comes from the line of Michael Sarcone from Jefferies. Please go ahead.
Michael Sarcone: Hey good afternoon and thanks for taking my questions.
Tim Herbert: Hey Michael.
Michael Sarcone: Just wanted to start. Maybe you can just give us an update, if possible, on how activity is trending so far through the first quarter? And then maybe elaborate somewhat on how you’re thinking about Seasonality this year and quarterly sales cadence?
Tim Herbert: Absolutely. Well, I think the — we felt very comfortable with the strength of the organization as we’re exiting the fourth quarter, be able to set our guide or reconfirm the guide that we initially preannounced at the JPMorgan Conference. But the progress continues to be steady. That’s why we’re comfortable with the guidance going forward. I’ll let Rick touch a little bit about cadence of quarters, specifically of seasonality here in the first quarter.
Rick Buchholz: Right. Thanks for the question. So, as I mentioned in the prepared remarks, we do have a stronger commercial mix with the high deductible plans in the fourth quarter. So, we generally see that seasonality in the first quarter, but also, we did see a little recovery from the third quarter into the fourth quarter. So we had a very strong fourth quarter, and that’s where we mentioned we might have some more pronounced seasonality. And so given the typical seasonality plus the stronger Q4, our seasonality into Q1, it could range from the mid to high teens sequentially. And then from there, we expect it to return and grow, and you’ve seen our guidance is to have between 24% and 26% growth, $780 million at the midpoint.
Michael Sarcone: Got it. Thanks Rick. And then just, I guess, 1 follow-up on profitability. Again, just a clarification really, the hitting profitability in the second half of 2024, is that a bolt on operating income and net profitability basis?
Rick Buchholz: Yes. As we sit here today, yes, that is the case, and that will be for the second half of the year.
Michael Sarcone: Right. All right. Great. Thank you.
Rick Buchholz: Thanks Michael.
Operator: Thank you. And I show our next question comes from the line of Danielle Antalffy from UBS. Please go ahead.
Danielle Antalffy: Hey, good afternoon guys. Thanks so much for taking the question. Congrats on a strong end to 2023 and looking forward to 2024. So I guess, Tim, the one question I wanted to — I have two questions. Just first on sleep centers and I know getting patients through sleep centers, that’s going to bottleneck, you’ve made some investments there. Just curious to see what — how those investments have been panning out? And do sleep centers still represent a bottleneck? Or is that starting to ease? And then I would just love ahead of SERMELT-OSA coming at some point, maybe mid-year-ish. Any more thoughts on how we should think about the impact of the funnel for Inspire in 20 and 2025, assuming that they do get coverage for obstructive sleep apnea patients. Thanks so much.
Tim Herbert: Thank you very much, Danielle. Good to hear from you. As far as sleep centers go, it’s taking that even a step higher. We’re spending a lot of time even educating and involving sleep physicians to be more involved with the patients and specifically with the longitudinal management. So while the focus today remains on building the capacity of the ENT, we know that the next challenge will be building enough capacity with the sleep physicians and specifically around the sleep centers. A lot of payers require sleep studies to be performed at – in a sleep lab for a polysomnography. But we do talk to them and show the value of home sleep testing and we’ve had opportunities to work with different parties to be able to provide home sleep testing or different areas to be able to help assess sleeping.
That’s going to continue to be a focus going forward into 2024 and beyond. And we’re trying to make sure that that’s not going to be a challenge going forward, because we can get those patients properly diagnosed. And we do know, most of the payers require a current sleep study within two years prior to moving on with Inspire. As far as the SURMOUNT-OSA trial, yes, hopefully, that data will come out earlier in the year. We would like to hope it’s successful and can show a 50% reduction in AHI. We know that’s going to be a little bit of a challenge for the drug, as long as the compliance and the weight loss is there to support that. But with the demographics of that study having a BMI of on average 40 and AHI, an average of 50, we really need to see a 50% reduction to have those patients move into the approved Inspire indication and the majority of the patients in that study when we look at the demographics, they really won’t qualify for Inspire today anyways, because of the lateral wall collapse associated with a high BMI.
So we look forward to seeing that data, but we do not believe it’s going to have any impact on our patient flow this year and will tend to be positive as we kind of move forward after 2024.
Danielle Antalffy: Thank you so much.
Tim Herbert: Thank you.
Operator: And I show our next question comes from the line of Richard Newitter from Truist Securities. Please go ahead.
Richard Newitter : Hi. Thanks for taking the question. Congrats on the quarter and the profitability as well. So maybe two questions for me. The first, just with Inspire V coming, you have a preliminary launch, hopefully, an approval later this year. I guess what, if anything, is contemplating the outlook for people potentially delaying or wanting the next-generation device, if they know that it’s coming, doctors and patients alike. I’m just curious how you’ve contemplated that. Should we be expecting any impact there and if it is in the guide at all?
