As the Q3 earnings season wraps, let’s dig into this quarter’s best and worst performers in the medical devices & supplies - specialty industry, including Inspire Medical Systems (NYSE: INSP) and its peers.

The medical devices industry operates a business model that balances steady demand with significant investments in innovation and regulatory compliance. The industry benefits from recurring revenue streams tied to consumables, maintenance services, and incremental upgrades to the latest technologies, although specialty devices are more niche. The capital-intensive nature of product development, coupled with lengthy regulatory pathways and the need for clinical validation, can weigh on profitability and timelines. In addition, there are constant pricing pressures from healthcare systems and insurers maximizing cost efficiency. Over the next several years, one tailwind is demographic–aging populations means rising chronic disease rates that drive greater demand for medical interventions and monitoring solutions. Advances in digital health, such as remote patient monitoring and smart devices, are also expected to unlock new demand by shortening upgrade cycles. On the other hand, the industry faces headwinds from pricing and reimbursement pressures as healthcare providers increasingly adopt value-based care models. Additionally, the integration of cybersecurity for connected devices adds further risk and complexity for device manufacturers.

The 7 medical devices & supplies - specialty stocks we track reported a very strong Q3. As a group, revenues beat analysts’ consensus estimates by 2.7%.

In light of this news, share prices of the companies have held steady as they are up 2.7% on average since the latest earnings results.

Inspire Medical Systems (NYSE: INSP)

Offering an alternative for the millions who struggle with traditional CPAP machines, Inspire Medical Systems (NYSE: INSP) develops and sells an implantable neurostimulation device that treats obstructive sleep apnea by stimulating nerves to keep airways open during sleep.

Inspire Medical Systems reported revenues of $224.5 million, up 10.5% year on year. This print exceeded analysts’ expectations by 1.9%. Overall, it was a very strong quarter for the company with a beat of analysts’ EPS estimates and a solid beat of analysts’ full-year EPS guidance estimates.

“The Inspire team had a very productive third quarter focusing on the transition to the Inspire V system while delivering very strong results globally,” said Tim Herbert, Chairman and Chief Executive Officer of Inspire Medical Systems.

Interestingly, the stock is up 8.8% since reporting and currently trades at $80.19.

We think Inspire Medical Systems is a good business, but is it a buy today? Read our full report here, it’s free.

Best Q3: STAAR Surgical (NASDAQ: STAA)

With over 2.5 million implants performed worldwide, STAAR Surgical (NASDAQ: STAA) designs and manufactures implantable lenses that correct vision problems without removing the eye's natural lens.

STAAR Surgical reported revenues of $94.73 million, up 6.9% year on year, outperforming analysts’ expectations by 4.3%. The business had a stunning quarter with an impressive beat of analysts’ constant currency revenue estimates and a beat of analysts’ EPS estimates.

Although it had a fine quarter compared its peers, the market seems unhappy with the results as the stock is down 28.2% since reporting. It currently trades at $19.12.

Is now the time to buy STAAR Surgical? Access our full analysis of the earnings results here, it’s free.

Weakest Q3: Integer Holdings (NYSE: ITGR)

With its name reflecting the mathematical term for "whole" or "complete," Integer Holdings (NYSE: ITGR) is a medical device outsource manufacturer that produces components and systems for cardiac, vascular, neurological, and other medical applications.

Integer Holdings reported revenues of $467.7 million, up 8.4% year on year, in line with analysts’ expectations. It was a slower quarter as it posted full-year EBITDA guidance missing analysts’ expectations significantly and full-year revenue guidance slightly missing analysts’ expectations.

As expected, the stock is down 21.3% since the results and currently trades at $85.92.

Read our full analysis of Integer Holdings’s results here.

Bausch + Lomb (NYSE: BLCO)

With a nearly 170-year history dedicated to vision care and eye health innovation, Bausch + Lomb (NYSE: BLCO) develops and manufactures a comprehensive range of eye health products including contact lenses, pharmaceuticals, surgical devices, and consumer eye care solutions.

Bausch + Lomb reported revenues of $1.28 billion, up 7.1% year on year. This result was in line with analysts’ expectations. Taking a step back, it was a satisfactory quarter as it also recorded a beat of analysts’ EPS estimates but constant currency revenue in line with analysts’ estimates.

Bausch + Lomb scored the highest full-year guidance raise but had the weakest performance against analyst estimates among its peers. The stock is up 10.3% since reporting and currently trades at $16.77.

Read our full, actionable report on Bausch + Lomb here, it’s free.

Globus Medical (NYSE: GMED)

With operations spanning 64 countries and a portfolio of over 10 new products launched in 2023 alone, Globus Medical (NYSE: GMED) develops and sells implantable devices, surgical instruments, and technology solutions for spine, orthopedic, and neurosurgical procedures.

Globus Medical reported revenues of $769 million, up 22.9% year on year. This number beat analysts’ expectations by 4.7%. Overall, it was a stunning quarter as it also recorded an impressive beat of analysts’ constant currency revenue estimates and a beat of analysts’ EPS estimates.

Globus Medical pulled off the fastest revenue growth but had the weakest full-year guidance update among its peers. The stock is up 48.4% since reporting and currently trades at $91.56.

Read our full, actionable report on Globus Medical here, it’s free.

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