INGN Inogen Inc

 

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

 

FORM 8-K

 

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): February 27, 2024

 

 

INOGEN, INC.

(Exact name of Registrant as Specified in Its Charter)

 

 

Delaware			001-36309	33-0989359
(State or Other Jurisdiction of Incorporation)			(Commission File Number)	(IRS Employer Identification No.)
859 Ward Drive
Goleta, California				93111
(Address of Principal Executive Offices)				(Zip Code)

 

Registrant’s Telephone Number, Including Area Code: (805) 562-0500

 

(Former Name or Former Address, if Changed Since Last Report)

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

Securities registered pursuant to Section 12(b) of the Act:

Title of each class		Trading Symbol(s)		Name of each exchange on which registered
Common Stock, $0.001 par value		INGN		The Nasdaq Stock Market LLC

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b-2 of this chapter).

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

 

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Item 2.02 Results of Operations and Financial Condition.

On February 27, 2024, Inogen, Inc. (the "Company") issued a press release reporting its financial results for the fourth quarter and the full year ended December 31, 2023. A copy of the press release is furnished herewith as Exhibit 99.1 to this Current Report on Form 8-K.

 

The information furnished in this Current Report under Item 2.02 and the exhibit attached hereto shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or incorporated by reference in any filing under the Securities Act of 1933, as amended (the "Securities Act"), or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing.

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits

Exhibit		Description
99.1		Press Release dated February 27, 2024.
104		The cover page of this Current Report on Form 8-K, formatted in Inline XBRL.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

			INOGEN, INC.
Date:	February 27, 2024	By:	/s/ Michael K. Sergesketter
			Michael K. Sergesketter Executive Vice President Chief Financial Officer Treasurer (Principal Accounting and Financial Officer)

 

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Exhibit 99.1

 

Inogen Announces Fourth Quarter and Full-Year 2023 Financial Results

Fourth quarter 2023 revenue of $75.9 million; full-year 2023 revenue of $315.7 million

Goleta, CA – February 27, 2024 – Inogen, Inc. (Nasdaq: INGN), a medical technology company offering innovative respiratory products for use in the homecare setting, today announced financial results for the fourth quarter and the full-year ended December 31, 2023.

“I am excited for the future of Inogen. As we progress into 2024, we are focused on positioning the business for revenue growth and long-term profitability while advancing our innovation pipeline and working to bring Physio-Assist to the U.S. market,” said Kevin Smith, President and Chief Executive Officer. “We have a strong management team with the recent additions of Grégoire Ramade as Chief Commercial Officer and Michael Bourque as Chief Financial Officer, and we are confident in our ability to deliver value for shareholders.”

Fourth Quarter 2023 Financial Results

Fourth quarter total revenue was $75.9 million, relative to $88.1 million in the fourth quarter of 2022, primarily due to a decrease in domestic business-to-business sales and direct-to-consumer sales, partially offset by higher rental revenue.

Total gross margin was 37.1% in the fourth quarter of 2023 versus 33.5% in the comparative period in 2022. The increase was driven primarily by lower premiums paid for components and labor and overhead costs.

Total operating expense for the quarter was $57.1 million compared to $88.0 million in the fourth quarter of 2022. The decrease was primarily due to the loss on disposal of an intangible asset of $52.2 million in the prior-year period, partially offset by the change in fair value of the earnout liabilities and certain one-time costs related to the CEO transition and bad debt expense.

GAAP net loss for the fourth quarter of 2023 was $26.6 million compared to GAAP net loss of $56.6 million in the fourth quarter of 2022. Adjusted net loss for the fourth quarter of 2023 was $19.4 million compared to adjusted net loss of $13.0 million in the fourth quarter of 2022.

Adjusted EBITDA was a negative $17.3 million in the fourth quarter of 2023 compared to a negative $10.6 million in the fourth quarter of 2022.

Cash, cash equivalents and marketable securities were $128.5 million as of December 31, 2023, with no debt outstanding.

 

 

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Full-Year 2023 Financial Results

Total revenue was $315.7 million compared to $377.2 million in 2022, primarily due to declines in direct-to-consumer sales as well as domestic and international business-to-business sales, partially offset by higher rental revenue.

Total gross margin was 40.1% for the full-year 2023 versus 40.7% in 2022. The decline was primarily due to sales channel mix and higher servicing costs, partially offset by lower premiums paid for components and labor and overhead costs as well as higher reimbursement rates. Additional impacts included higher cost of other materials and warranty cost per unit sold.

Total operating expense for the full-year 2023 was $236.1 million compared to $238.8 million for the full-year 2022.

GAAP net loss for full-year 2023 was $102.4 million compared to GAAP net loss of $83.8 million for full-year 2022. Adjusted net loss for full-year 2023 was $48.3 million compared to adjusted net loss of $26.2 million for full-year 2022.

Adjusted EBITDA was a negative $37.8 million for the full-year 2023 compared to a negative $13.5 million for the full-year 2022.

Reconciliations of adjusted EBITDA and adjusted net loss for the three and twelve months ended December 31, 2023 and 2022 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 “Non-GAAP Financial Measures.”

First Quarter 2024 Financial Outlook

For the first quarter 2024, Inogen expects revenue of $73 to $74 million, reflecting 1% to 3% reported growth relative to the first quarter 2023.

Quarterly Conference Call Information

Inogen will issue fourth quarter and full-year 2023 financial results after the market closes on Tuesday, February 27, 2024. On the same day, the company will host a conference call beginning at 2:00 pm PT / 5:00 pm ET.

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. To listen to a live webcast, please visit the Investor Relations section of Inogen's website at: http://investor.inogen.com/. 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 March 5, 2024. To access the replay, dial (877) 660-6853 or (201) 612-7415 and reference Conference ID: 13743411.

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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. For more information, visit http://investor.inogen.com/.

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, advancing the innovation pipeline, working to bring Physio-Assist to the U.S. market, and Inogen’s first quarter 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, its Quarterly Report on Form 10-Q for the calendar quarter ended September 30, 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.

 

 

 

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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 and twelve months ended December 31, 2023, and December 31, 2022. 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.

Contact

ir@inogen.net

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Consolidated Statements of Comprehensive Loss
(unaudited)
(amounts in thousands, except share and per share amounts)
		Three months ended								Twelve months ended
		December 31,								December 31,
		2023				2022				2023				2022
Revenue
Sales revenue		$	59,404			$	73,184			$	251,607			$	320,549
Rental revenue			16,492				14,907				64,053				56,692
Total revenue			75,896				88,091				315,660				377,241
Cost of revenue
Cost of sales revenue			39,936				51,753				158,636				197,805
Cost of rental revenue, including depreciation of $3,213 and $2,950 for the three months ended and $12,893 and $11,103 for the twelve months ended, respectively			7,802				6,867				30,325				25,903
Total cost of revenue			47,738				58,620				188,961				223,708
Gross profit			28,158				29,471				126,699				153,533
Operating expense
Research and development			6,714				5,934				20,840				21,943
Sales and marketing			25,653				28,606				107,091				120,767
General and administrative			24,773				1,259				75,260				43,905
Loss on disposal of intangible asset			—				52,161				—				52,161
Impairment charges			—				—				32,894				—
Total operating expense			57,140				87,960				236,085				238,776
Loss from operations			(28,982	)			(58,489	)			(109,386	)			(85,243	)
Other income (expense)
Interest income			1,602				1,715				6,574				2,837
Other income (expense)			292				305				468				(862	)
Total other income, net			1,894				2,020				7,042				1,975
Loss before provision (benefit) for income taxes			(27,088	)			(56,469	)			(102,344	)			(83,268	)
Provision (benefit) for income taxes			(533	)			141				105				504
Net loss			(26,555	)			(56,610	)			(102,449	)			(83,772	)
Other comprehensive income (loss), net of tax
Change in foreign currency translation adjustment			1,933				856				1,358				(597	)
Change in net unrealized gains (losses) on foreign currency hedging			(78	)			(1,461	)			—				(3,130	)
Less: reclassification adjustment for net (gains) losses included in net income			25				784				—				1,990
Total net change in unrealized gains (losses) on foreign currency hedging			(53	)			(677	)			—				(1,140	)
Change in net unrealized gains (losses) on marketable securities			(72	)			9				110				25
Total other comprehensive income (loss), net of tax			1,808				188				1,468				(1,712	)
Comprehensive loss		$	(24,747	)		$	(56,422	)		$	(100,981	)		$	(85,484	)
Basic net loss per share attributable to common stockholders (1)		$	(1.14	)		$	(2.47	)		$	(4.42	)		$	(3.67	)
Diluted net loss per share attributable to common stockholders (1) (2)		$	(1.14	)		$	(2.47	)		$	(4.42	)		$	(3.67	)
Weighted-average number of shares used in calculating net loss per share attributable to common stockholders:
Basic common shares			23,313,495				22,926,276				23,176,098				22,852,571
Diluted common shares			23,313,495				22,926,276				23,176,098				22,852,571

 

 

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Consolidated Balance Sheets
(unaudited)
(amounts in thousands)
		December 31,				December 31,
		2023				2022
Assets
Current assets
Cash and cash equivalents		$	125,492			$	187,014
Marketable securities			2,979				—
Accounts receivable, net			42,241				62,725
Inventories, net			21,840				34,093
Income tax receivable			669				1,626
Prepaid expenses and other current assets			13,846				19,187
Total current assets			207,067				304,645
Property and equipment, net			50,316				43,269
Goodwill			10,057				32,852
Intangibles and other non-current assets			34,591				177
Operating lease right-of-use asset			20,338				21,653
Other assets			3,825				2,445
Total assets		$	326,194			$	405,041
Liabilities and stockholders' equity
Current liabilities
Accounts payable and accrued expenses		$	30,142			$	33,974
Accrued payroll			11,066				11,190
Warranty reserve - current			9,628				7,790
Operating lease liability - current			3,653				3,515
Earnout liability			10,000				—
Deferred revenue - current			7,980				8,880
Income tax payable			27				—
Total current liabilities			72,496				65,349
Warranty reserve - noncurrent			13,850				12,123
Operating lease liability - noncurrent			18,270				19,764
Deferred revenue - noncurrent			8,227				10,399
Deferred tax liability - noncurrent			8,539				—
Total liabilities			121,382				107,635
Stockholders' equity
Common stock			23				23
Additional paid-in capital			320,513				312,126
Accumulated deficit			(116,949	)			(14,500	)
Accumulated other comprehensive income (loss)			1,225				(243	)
Total stockholders' equity			204,812				297,406
Total liabilities and stockholders' equity		$	326,194			$	405,041

 

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Condensed Consolidated Cash Flow
(unaudited)
(amounts in thousands)
		Years Ended December 31,
		2023				2022
Cash flows from operating activities
Net loss		$	(102,449	)		$	(83,772	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization			18,152				23,514
Loss on rental units and other assets			4,508				3,095
Gain on sale of former rental assets			(84	)			(154	)
Provision for sales revenue returns and doubtful accounts			10,730				13,024
Provision for inventory losses			2,691				2,423
Loss on purchase commitments			2,057				—
Stock-based compensation expense			7,427				12,283
Deferred income taxes			(251	)			—
Change in fair value of earnout liability			6,822				(15,386	)
Loss on disposal of intangible asset			—				52,161
Impairment charges			32,894				—
Changes in operating assets and liabilities			14,269				(44,720	)
Net cash used in operating activities			(3,234	)			(37,532	)
Cash flows from investing activities
Purchases of available-for-sale securities			(26,869	)			—
Maturities of available-for-sale securities			24,000				10,014
Investment in intangible assets			(494	)			—
Investment in property and equipment			(5,218	)			(3,337	)
Production and purchase of rental equipment			(21,299	)			(17,885	)
Proceeds from sale of former assets			198				331
Acquisition of business, net of cash acquired			(29,633	)			—
Net cash used in investing activities			(59,315	)			(10,877	)
Cash flows from financing activities
Proceeds from stock options exercised			384				44
Proceeds from employee stock purchases			1,094				1,691
Payment of employment taxes related to release of restricted stock			(518	)			(1,355	)
Net cash provided by financing activities			960				380
Effect of exchange rates on cash			67				(481	)
Net decrease in cash and cash equivalents		$	(61,522	)		$	(48,510	)

 

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Supplemental Financial Information
(unaudited)
(in thousands, except units and patients)
		Three months ended December 31,								Change as reported								Constant Currency Change
		2023				2022				$				%				%
Revenue by region and category
Business-to-business domestic sales		$	18,051			$	27,190			$	(9,139	)			-33.6	%			-33.6	%
Business-to-business international sales			21,524				20,703				821				4.0	%			2.6	%
Direct-to-consumer domestic sales			19,829				25,291				(5,462	)			-21.6	%			-21.6	%
Direct-to-consumer domestic rentals			16,492				14,907				1,585				10.6	%			10.6	%
Total revenue		$	75,896			$	88,091			$	(12,195	)			-13.8	%			-14.3	%
Additional financial measures
Units sold			34,100				43,500
Net rental patients as of period-end			51,900				45,600
		Twelve months ended December 31,								Change as reported								Constant Currency Change
		2023				2022				$				%				%
Revenue by region and category
Business-to-business domestic sales		$	66,196			$	86,049			$	(19,853	)			-23.1	%			-23.1	%
Business-to-business international sales			89,401				101,163				(11,762	)			-11.6	%			-11.2	%
Direct-to-consumer domestic sales			96,010				133,337				(37,327	)			-28.0	%			-28.0	%
Direct-to-consumer domestic rentals			64,053				56,692				7,361				13.0	%			13.0	%
Total revenue		$	315,660			$	377,241			$	(61,581	)			-16.3	%			-16.2	%
Additional financial measures
Units sold			130,500				170,500
Net rental patients as of period-end			51,900				45,600

 

 

 

Reconciliation of U.S. GAAP to Other Non-GAAP Financial Measures
(unaudited)
(in thousands)
		Three months ended								Twelve months ended
		December 31,								December 31,
Non-GAAP EBITDA and Adjusted EBITDA		2023				2022				2023				2022
Net loss (GAAP)		$	(26,555	)		$	(56,610	)		$	(102,449	)		$	(83,772	)
Non-GAAP adjustments:
Interest income, net			(1,602	)			(1,715	)			(6,574	)			(2,837	)
Provision for income taxes			(533	)			141				105				504
Depreciation and amortization			5,144				5,978				18,152				23,514
EBITDA (non-GAAP)			(23,546	)			(52,206	)			(90,766	)			(62,591	)
Stock-based compensation			(1,057	)			3,098				7,427				12,283
Acquisition-related expenses			432				—				2,413				—
Restructuring-related and other charges (1)			—				—				3,426				—
Impairment charges			—				—				32,894				—
Change in fair value of earnout liability			6,822				(13,687	)			6,822				(15,386	)
Loss on disposal of intangible asset			—				52,161				—				52,161
Adjusted EBITDA (non-GAAP)		$	(17,349	)		$	(10,634	)		$	(37,784	)		$	(13,533	)

 

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		Three months ended December 31,
		Net Loss								Diluted EPS
Non-GAAP Adjusted Net Loss and Diluted EPS		2023				2022				2023				2022
Financial Results (GAAP)		$	(26,555	)		$	(56,610	)		$	(1.14	)		$	(2.47	)
Non-GAAP adjustments:
Amortization of intangibles			918				2,022
Stock-based compensation			(1,057	)			3,098
Acquisition-related expenses			432				—
Change in fair value of earnout liability			6,822				(13,687	)
Loss on disposal of intangible asset			—				52,161
Income tax impact of adjustments (2)			—				—
Adjusted		$	(19,440	)		$	(13,016	)		$	(0.83	)		$	(0.57	)
		Twelve months ended December 31,
		Net Loss								Diluted EPS
Non-GAAP Adjusted Net Loss and Diluted EPS		2023				2022				2023				2022
Financial Results (GAAP)		$	(102,449	)		$	(83,772	)		$	(4.42	)		$	(3.67	)
Non-GAAP adjustments:
Amortization of intangibles			1,202				8,469
Stock-based compensation			7,427				12,283
Acquisition-related expenses			2,413				—
Restructuring-related and other charges (1)			3,426				—
Impairment charges			32,894				—
Change in fair value of earnout liability			6,822				(15,386	)
Loss on disposal of intangible asset			—				52,161
Income tax impact of adjustments (2)			—				—
Adjusted		$	(48,265	)		$	(26,245	)		$	(2.08	)		$	(1.15	)

 

 

 

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v3.24.0.1

Document And Entity Information	Feb. 27, 2024
Cover [Abstract]
Document Type	8-K
Amendment Flag	false
Document Period End Date	Feb. 27, 2024
Entity Registrant Name	Inogen Inc
Entity Central Index Key	0001294133
Entity Emerging Growth Company	false
Entity File Number	001-36309
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	33-0989359
Entity Address, Address Line One	859 Ward Drive
Entity Address, City or Town	Goleta
Entity Address, State or Province	CA
Entity Address, Postal Zip Code	93111
City Area Code	(805)
Local Phone Number	562-0500
Written Communications	false
Soliciting Material	false
Pre-commencement Tender Offer	false
Pre-commencement Issuer Tender Offer	false
Title of 12(b) Security	Common Stock, $0.001 par value
Trading Symbol	INGN
Security Exchange Name	NASDAQ

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