Inogen Announces First Quarter 2024 Financial Results

About this update from Inogen, Inc

GOLETA, Calif. --(BUSINESS WIRE)-- Inogen, Inc. (Nasdaq: INGN ), a medical technology company offering innovative respiratory products for use in the homecare setting, today announced financial results for the quarter ended March 31, 2024 . “We are pleased to be off to a solid start at Inogen in 2024. Looking forward, we remain focused on positioning the business for revenue growth, improving our operating discipline to drive long-term profitability, and investing in our innovation pipeline to broaden our product portfolio,” said Kevin Smith , President and Chief Executive Officer. “The performance in the quarter reflects the quality of the team we have in place, and we will continue executing against our strategic priorities, while strengthening our market leading position. I am excited for the future of Inogen.” First Quarter 2024 Financial Results First quarter total revenue increased 8.1% to $78.0 million from $72.2 million in the first quarter of 2023, primarily driven by higher international and domestic business-to business sales, partially offset by lower direct-to-consumer sales and rental revenue. Total gross margin was 44.1% in the first quarter of 2024 versus 42.6% in the comparative period in 2023. The increase was driven primarily by lower premiums paid for components, partially offset by sales channel mix. Total operating expense for the quarter was $50.6 million compared to $52.6 million in the first quarter of 2023, representing a decrease of 3.8%. GAAP net loss for the first quarter of 2024 was $14.6 million compared to GAAP net loss of $20.3 million in the first quarter of 2023. Adjusted net loss was $10.4 million compared to adjusted net loss of $14.5 million in the first quarter of 2023. Adjusted EBITDA was a negative $7.6 million in the first quarter of 2024 compared to a negative $11.8 million in the first quarter of 2023. Cash, cash equivalents and marketable securities were $119.8 million as of March 31, 2024 , and no debt outstanding. A reconciliation of adjusted EBITDA and adjusted net loss for the three months ended March 31, 2024 and 2023 are provided in the financial schedules that are a part of this press release. An explanation of these non-GAAP financial measures is also included below under the heading “Reconciliation of U.S. GAAP to Other Non-GAAP Financial Measures.” Second Quarter 2024 Financial Outlook For the second quarter of 2024, Inogen expects revenue to be in the range of $81 million to $84 million . Quarterly Conference Call Information On Tuesday, May 7, 2024 the Company will host a conference call at 2:00 pm Pacific Time / 5:00 pm Eastern Time . Individuals interested in listening to the conference call may do so by dialing: US domestic callers (877) 841-3961 Non-US callers (201) 689-8589 Please reference Inogen to join the call. A live audio webcast and archived recording of the conference call will be available to all interested parties through the News / Events page on the Inogen Investor Relations website. This webcast will also be archived on the website for 6 months. A replay of the call will be available approximately three hours after the live webcast ends and will be accessible through May 14, 2024 . To access the replay, dial (877) 660-6853 or (201) 612-7415 and reference Conference ID: 13745058. Inogen has used, and intends to continue to use, its Investor Relations website, http://investor.inogen.com/ , as a means of disclosing material non-public information and for complying with its disclosure obligations under Regulation FD. About Inogen Inogen, Inc. (Nasdaq: INGN) is a leading global medical technology company offering innovative respiratory products for use in the homecare setting. Inogen supports patient respiratory care by developing, manufacturing, and marketing innovative best-in-class portable oxygen concentrators used to deliver supplemental long-term oxygen therapy to patients suffering from chronic respiratory conditions. Inogen partners with patients, prescribers, home medical equipment providers, and distributors to make its oxygen therapy products widely available allowing patients the chance to remain ambulatory while managing the impact of their disease. For more information, please visit www.inogen.com . Forward-Looking Statements This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including, among others, statements with respect to the business positioned for revenue growth and long-term profitability, investing in the innovation pipeline, and Inogen’s second quarter 2024 revenue expectations. Any statements contained in this communication that are not statements of historical fact may be deemed to be forward-looking statements. Words such as “believes,” “anticipates,” “plans,” “expects,” “will,” “intends,” “potential,” “possible,” and similar expressions are intended to identify forward-looking statements. Forward-looking statements are subject to numerous risks and uncertainties that could cause actual results to differ materially from currently anticipated results, including but not limited to, risks related to its announced management and organizational changes, and risks arising from the possibility that Inogen will not realize anticipated future financial performance or strategic goals. In addition, Inogen's business is subject to numerous additional risks and uncertainties, including, among others, risks relating to market acceptance of its products; competition; its sales, marketing and distribution capabilities; its planned sales, marketing, and research and development activities; interruptions or delays in the supply of components or materials for, or manufacturing of, its products; seasonal variations; unanticipated increases in costs or expenses; risks associated with international operations; and the possibility that Inogen will not realize anticipated revenue from recent or future technology acquisitions or that expenses and costs related thereto will exceed Inogen’s expectations. Information on these and additional risks, uncertainties, and other information affecting Inogen’s business operating results are contained in its Annual Report on Form 10-K for the period ended December 31, 2023 , and in its other filings with the Securities and Exchange Commission . These forward-looking statements speak only as of the date hereof. Inogen disclaims any obligation to update these forward-looking statements except as may be required by law. Non-GAAP Financial Measures Inogen has presented certain financial information in accordance with U.S. GAAP and also on a non-GAAP basis for the three months ended March 31, 2024 , and March 31, 2023 . Management believes that non-GAAP financial measures, taken in conjunction with U.S. GAAP financial measures, provide useful information for both management and investors by excluding certain non-cash and other expenses that are not indicative of Inogen’s core operating results. Management uses non-GAAP measures to compare Inogen’s performance relative to forecasts and strategic plans, to benchmark Inogen’s performance externally against competitors, and for certain compensation decisions. Non-GAAP information is not prepared under a comprehensive set of accounting rules and should only be used to supplement an understanding of Inogen's operating results as reported under U.S. GAAP. Inogen encourages investors to carefully consider its results under U.S. GAAP, as well as its supplemental non-GAAP information and the reconciliation between these presentations, to more fully understand its business. Reconciliations between U.S. GAAP and non-GAAP results are presented in the accompanying tables of this release. For future periods, Inogen is unable to provide a reconciliation of non-GAAP measures without unreasonable effort as a result of the uncertainty regarding, and the potential variability of, the amounts of interest income, interest expense, depreciation and amortization, stock-based compensation, provision for income taxes, and certain other infrequently occurring items, such as acquisition-related costs, that may be incurred in the future. Consolidated Statements of Comprehensive Loss (unaudited) (amounts in thousands, except share and per share amounts) Three months ended March 31 , 2024 2023 Revenue Sales revenue $ 63,095 $ 55,887 Rental revenue 14,930 16,275 Total revenue 78,025 72,162 Cost of revenue Cost of sales revenue 35,244 33,964 Cost of rental revenue, including depreciation of $3,179 and $3,078 , respectively 8,410 7,465 Total cost of revenue 43,654 41,429 Gross profit 34,371 30,733 Operating expense Research and development 6,578 5,344 Sales and marketing 26,936 28,441 General and administrative 17,131 18,863 Total operating expense 50,645 52,648 Loss from operations (16,274 ) (21,915 ) Other income (expense) Interest income, net 1,403 1,525 Other income, net 143 237 Total other income, net 1,546 1,762 Loss before provision (benefit) for income taxes (14,728 ) (20,153 ) Provision (benefit) for income taxes (150 ) 196 Net loss (14,578 ) (20,349 ) Other comprehensive income (loss), net of tax Change in foreign currency translation adjustment (1,035 ) 170 Change in net unrealized gains (losses) on marketable securities (2 ) 69 Total other comprehensive income (loss), net of tax (1,037 ) 239 Comprehensive loss $ (15,615 ) $ (20,110 ) Basic net loss per share attributable to common stockholders (1) $ (0.62 ) $ (0.88 ) Diluted net loss per share attributable to common stockholders (1) (2) $ (0.62 ) $ (0.88 ) Weighted-average number of shares used in calculating net loss per share attributable to common stockholders: Basic common shares 23,401,598 23,009,617 Diluted common shares 23,401,598 23,009,617 (1) Reconciliations of net loss attributable to common stockholders basic and diluted can be found in Inogen’s Quarterly Report on Form 10-Q to be filed with the Securities and Exchange Commission . (2) Due to a net loss for the three months ended March 31, 2024 and March 31, 2023 , diluted loss per share is the same as basic. Consolidated Balance Sheets (unaudited) (amounts in thousands) March 31 , December 31 , 2024 2023 Assets Current assets Cash and cash equivalents $ 107,444 $ 125,492 Marketable securities 12,361 2,979 Accounts receivable, net 40,223 42,241 Inventories, net 24,601 21,840 Income tax receivable 976 669 Prepaid expenses and other current assets 13,589 13,846 Total current assets 199,194 207,067 Property and equipment, net 49,270 50,316 Goodwill 9,834 10,057 Intangibles assets, net 32,907 34,591 Operating lease right-of-use asset 20,575 20,338 Other assets 3,819 3,825 Total assets $ 315,599 $ 326,194 Liabilities and stockholders' equity Current liabilities Accounts payable and accrued expenses $ 31,706 $ 30,142 Accrued payroll 10,602 11,066 Warranty reserve - current 10,095 9,628 Operating lease liability - current 3,515 3,653 Earnout liability 10,570 10,000 Deferred revenue - current 7,422 7,980 Income tax payable — 27 Total current liabilities 73,910 72,496 Warranty reserve - noncurrent 15,435 13,850 Operating lease liability - noncurrent 18,595 18,270 Deferred revenue - noncurrent 7,613 8,227 Deferred tax liability - noncurrent 8,148 8,539 Total liabilities 123,701 121,382 Stockholders' equity Common stock 24 23 Additional paid-in capital 323,213 320,513 Accumulated deficit (131,527 ) (116,949 ) Accumulated other comprehensive income 188 1,225 Total stockholders' equity 191,898 204,812 Total liabilities and stockholders' equity $ 315,599 $ 326,194 Condensed Consolidated Cash Flow (unaudited) (amounts in thousands) Three months ended March 31 , 2024 2023 Cash flows from operating activities Net loss $ (14,578 ) $ (20,349 ) Adjustments to reconcile net loss to net cash used in operating activities: Depreciation and amortization 5,265 4,086 Loss on rental units and other assets 1,162 1,099 Gain on sale of former rental assets (38 ) (21 ) Provision for sales revenue returns and doubtful accounts 2,164 2,258 Provision for inventory losses (53 ) 603 Stock-based compensation expense 2,416 3,442 Deferred income taxes (201 ) — Change in fair value of earnout liability 570 — Changes in operating assets and liabilities (1,456 ) 2,581 Net cash used in operating activities (4,749 ) (6,301 ) Cash flows from investing activities Purchases of available-for-sale securities (12,384 ) (10,359 ) Maturities of available-for-sale securities 3,000 — Investment in property and equipment (1,310 ) (1,076 ) Production and purchase of rental equipment (2,820 ) (5,733 ) Proceeds from sale of former assets 70 58 Net cash used in investing activities (13,444 ) (17,110 ) Cash flows from financing activities Proceeds from stock options exercised — 384 Proceeds from employee stock purchases 370 630 Payment of employment taxes related to release of restricted stock (85 ) (455 ) Net cash provided by financing activities 285 559 Effect of exchange rates on cash (140 ) (25 ) Net decrease in cash and cash equivalents $ (18,048 ) $ (22,877 ) Supplemental Financial Information (unaudited) (in thousands, except units and patients) Three months ended March 31 , Change as reported Constant Currency Change 2024 2023 $ % % Revenue by region and category Business-to-business domestic sales $ 16,519 $ 12,585 $ 3,934 31.3 % 31.3 % Business-to-business international sales 26,035 18,972 7,063 37.2 % 35.4 % Direct-to-consumer domestic sales 20,541 24,330 (3,789 ) -15.6 % -15.6 % Direct-to-consumer domestic rentals 14,930 16,275 (1,345 ) -8.3 % -8.3 % Total revenue $ 78,025 $ 72,162 $ 5,863 8.1 % 7.6 % Additional financial measures Units sold 33,900 26,900 Net rental patients as of period-end 51,800 45,800 Reconciliation of U.S. GAAP to Other Non-GAAP Financial Measures (unaudited) (in thousands) Three months ended March 31 , Non-GAAP EBITDA and Adjusted EBITDA 2024 2023 Net loss (GAAP) $ (14,578 ) $ (20,349 ) Non-GAAP adjustments: Interest income, net (1,403 ) (1,525 ) Provision (benefit) for income taxes (150 ) 196 Depreciation and amortization 5,265 4,086 EBITDA (non-GAAP) (10,866 ) (17,592 ) Stock-based compensation 2,416 3,442 Acquisition-related expenses 238 554 Restructuring-related and other charges (1) — 1,809 Change in fair value of earnout liability 570 — Adjusted EBITDA (non-GAAP) $ (7,642 ) $ (11,787 ) Three months ended March 31 , Net Loss Diluted EPS Non-GAAP Adjusted Net Loss and Diluted EPS 2024 2023 2024 2023 Financial Results (GAAP) $ (14,578 ) $ (20,349 ) $ (0.62 ) $ (0.88 ) Non-GAAP adjustments: Amortization of intangibles 932 26 Stock-based compensation 2,416 3,442 Acquisition-related expenses 238 554 Restructuring-related and other charges (1) — 1,809 Change in fair value of earnout liability 570 — Income tax impact of adjustments (2) — — Adjusted $ (10,422 ) $ (14,518 ) $ (0.45 ) $ (0.63 ) (1) Charges represent the costs associated with workforce reductions and associated costs and other restructuring-related activities. (2) Income tax impact of adjustments represents the tax impact related to the non-GAAP adjustments listed above and reflects an effective tax rate of 0% for 2024 and 2023. View source version on businesswire.com : https://www.businesswire.com/news/home/20240507945691/en/ [email protected] Source: Inogen, Inc.

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