Inogen Inc’s Mixed Q1 2025 Earnings Call Insights

Inogen Inc ((INGN)) has held its Q1 earnings call. Read on for the main highlights of the call.

Inogen Inc’s recent earnings call presented a mixed sentiment, reflecting both optimism and caution. The company reported strong revenue growth and improvements in its business-to-business (B2B) channel and adjusted EBITDA, signaling positive trends. However, challenges remain with significant declines in direct-to-consumer sales and rental revenue, alongside a net loss, suggesting a cautious outlook despite the positive developments.

Revenue Growth

Inogen delivered over $82 million in revenue for the first quarter of 2025, marking a 5.5% year-over-year growth. This increase highlights the company’s ability to generate higher sales compared to the previous year, showcasing a positive trajectory in its overall revenue performance.

B2B Channel Performance

The company’s domestic business-to-business revenue saw a significant increase of 29.9%, reaching $21.5 million. Additionally, international B2B revenue rose by 22.9% to $32 million. These figures underscore the strength of Inogen’s B2B operations, contributing positively to its financial performance.

Adjusted EBITDA Profitability

Inogen reported a positive adjusted EBITDA of $36,000 for the first quarter of 2025, a notable improvement from a negative $7.6 million in the prior period. This shift to profitability indicates enhanced operational efficiency and financial management.

UL Medical Collaboration

The company finalized a collaboration with UL Medical to distribute Inogen products in China and the US. UL Medical’s investment of $27 million for a 9.9% stake in Inogen highlights the strategic importance of this partnership, aiming to expand market reach and drive growth.

Improved Operating Expenses

Inogen successfully reduced its total operating expenses by 13.1% to $44 million in the first quarter of 2025 compared to the prior period. This reduction reflects the company’s efforts to streamline operations and enhance cost efficiency.

Balance Sheet Strength

The company reported a robust balance sheet with cash, cash equivalents, and restricted cash totaling $122.5 million and no debt outstanding. This financial stability provides Inogen with the flexibility to pursue strategic initiatives and investments.

Direct-to-Consumer Sales Decline

Despite positive trends in other areas, Inogen faced a 26.8% decline in direct-to-consumer sales, dropping to $15 million from $20.5 million in the prior period. This decrease highlights challenges in maintaining consumer sales momentum.

Rental Revenue Decline

Rental revenue also saw a decline of 7.5%, falling to $13.8 million from $14.9 million in the prior period. This was primarily driven by lower average billing rates, indicating a need for strategic adjustments in the rental segment.

Net Loss

Inogen reported a GAAP net loss of $6.2 million, an improvement from a loss of $14.6 million in the prior period. Although the loss has narrowed, it remains a critical area for the company to address moving forward.

Forward-Looking Guidance

Inogen’s guidance for the year emphasizes expectations for revenue growth and profitability. The company anticipates full-year 2025 revenue to be between $352 million and $355 million, reflecting a 5% to 6% increase from 2024. For the second quarter, revenue is projected to be between $89 million and $91 million, indicating flat to 3% growth compared to the same period in 2024. Inogen also aims to approach adjusted EBITDA breakeven for the full year, focusing on operational efficiencies and strategic investments.

In summary, Inogen Inc’s earnings call revealed a mixed sentiment with both positive developments and ongoing challenges. While revenue growth, B2B performance, and cost reductions are encouraging, declines in direct-to-consumer sales and rental revenue, along with a net loss, highlight areas needing attention. The company’s forward-looking guidance reflects confidence in its strategic priorities, aiming for sustained growth and profitability.