Inspire Medical Systems (INSP) Fell on Guidance

TimesSquare Capital Management, an equity investment management company, released its “U.S. Small Cap Growth Strategy” second-quarter 2025 investor letter. A copy of the letter can be downloaded here. During the quarter, the fund returned 11.28% (gross) and 11.02% (net), compared to the Russell 2000 Growth Index by 11.97%. Equities posted double-digit returns in the second quarter as global economic activity measures lifted. In addition, please check the fund’s top five holdings to know its best picks in 2025.

In its second-quarter 2025 investor letter, TimesSquare Capital Small Cap Growth Strategy highlighted stocks such as Inspire Medical Systems, Inc. (NYSE:INSP). Inspire Medical Systems, Inc. (NYSE:INSP) is a medical technology company that focuses on the development and commercialization of minimally invasive solutions for patients with obstructive sleep apnea.  The one-month return of Inspire Medical Systems, Inc. (NYSE:INSP) was -5.66%, and its shares lost 59.41% of their value over the last 52 weeks. On September 11, 2025, Inspire Medical Systems, Inc. (NYSE:INSP) stock closed at $82.80 per share, with a market capitalization of $2.449 billion.

TimesSquare Capital U.S. Focus Growth Strategy stated the following regarding Inspire Medical Systems, Inc. (NYSE:INSP) in its second quarter 2025 investor letter:

“Our preferences among Health Care stocks are those companies providing novel therapies for unmet needs that deserve premium pricing, or specialized service providers. Inspire Medical Systems, Inc. (NYSE:INSP), a medical technology company focused on the development and commercialization of innovative solutions for treating obstructive sleep apnea, pulled back by -18%. First quarter revenues exceeded consensus estimates. That report was overshadowed by second quarter guidance, which was viewed as disappointing. Management explained the second quarter will be a transitional period as centers work through their Inspire IV system inventory ahead of ordering the recently launched Inspire V systems.”

Inspire Medical Systems, Inc. (NYSE:INSP) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 34 hedge fund portfolios held Inspire Medical Systems, Inc. (NYSE:INSP) at the end of the second quarter, which was 37 in the previous quarter. In Q2 2025, Inspire Medical Systems, Inc. (NYSE:INSP) reported revenue of $217.1 million, an 11% increase from Q2 2024. While we acknowledge the risk and potential Inspire Medical Systems, Inc. (NYSE:INSP) as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than Inspire Medical Systems, Inc. (NYSE:INSP) and that has 10,000% upside potential, check out our report about this cheapest AI stock.

In another article, we covered Inspire Medical Systems, Inc. (NYSE:INSP) and shared the list of best medical device stocks to buy according to analysts. In addition, please check out our hedge fund investor letters Q2 2025 page for more investor letters from hedge funds and other leading investors.

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Disclosure: None. This article is originally published at Insider Monkey.