Inspire Medical Systems (INSP) saw its stock surge 6.42% on Tuesday, following the release of impressive third-quarter financial results and an updated full-year guidance. The medical device company, known for its innovative sleep apnea treatment, outperformed market expectations and demonstrated strong growth prospects.

The company reported a quarterly adjusted earnings per share (EPS) of $0.38, significantly beating the analyst consensus estimate of $(0.19). This represents a remarkable 295.88% surprise to the upside. Inspire Medical's Q3 revenue reached $224.5 million, surpassing the analyst estimate of $221.1 million and marking a 10.49% increase year-over-year. The strong performance was attributed to the successful transition to the new Inspire V system, which contributed to revenue growth and improved gross margin due to lower cost of goods sold.

Inspire Medical Systems also raised its full-year outlook, further fueling investor optimism. The company now expects full-year diluted net income per share to be between $0.90 and $1.00, up from previous estimates. Additionally, it reaffirmed its full-year revenue guidance of $900 million to $910 million and maintained its gross margin guidance at 84% to 86%. The positive results, improved outlook, and successful adoption of the Inspire V system appear to be the key drivers behind the stock's rally.