Inogen (INGN) Q3 Earnings Miss Estimates, Revenues Down Y/Y
Inogen, Inc. INGN incurred an adjusted loss per share of 36 cents for third-quarter 2023, wider than the adjusted loss per share of 18 cents in the year-ago period. The Zacks Consensus Estimate was pegged at a loss of 57 cents per share.
GAAP loss per share for the quarter was $1.97, wider than the year-earlier loss of 42 cents per share.
Revenues in Detail
Inogen registered revenues of $83.9 million for the third quarter, down 20.3% year over year. The figure surpassed the Zacks Consensus Estimate by 3.8%.
On a constant-currency basis, total revenues for the reported quarter decreased 21.5%.
Per management, the year-over-year decrease in the top line primarily resulted from lower domestic business-to-business sales and lower direct-to-consumer revenues. However, this was partially offset by strong growth in rental and international business-to-business sales.
Segmental Details
Inogen derives revenues from two sources — rental and sales.
Rental revenues for the reported quarter grossed $15.9 million, up 8.7% from the year-ago period. Per management, an increase in the total number of rental patients on service resulted in the upside. This figure compares to our Rental revenues’ third-quarter projection of $13.1 million.
Sales revenues were $67.9 million, down 25% from the prior-year quarter. This figure compares to our Sales revenues’ third-quarter projection of $67.2 million.
Revenues by Region & Category
Domestic business-to-business sales for third-quarter 2023 amounted to $17.3 million, down 59.4% on a year-over-year basis. Our projection for the same was $34.7 million.
International business-to-business sales for the reported quarter amounted to $25.6 million, up 69.8% year over year on a reported basis and up 62% on a constant-currency basis. Our model estimate for the metric was $15.2 million.
Domestic direct-to-consumer sales decreased 24.1% year over year to $25.1 million for the quarter. Our estimate for the same was $17.3 million.
Inogen, Inc Price, Consensus and EPS Surprise
Inogen, Inc price-consensus-eps-surprise-chart | Inogen, Inc Quote
Margins
For the quarter under review, Inogen’s adjusted gross profit fell 18.6% from the year-ago period to $37.1 million. However, the adjusted gross margin expanded 96 basis points to 44.2%.
Sales and marketing expenses decreased 22.7% from the year-ago quarter to $26.1 million. Research and development expenses decreased 2% year over year to $4.5 million, while general and administrative expenses increased 15.1% to $17 million. Adjusted operating expenses of $47.6 million decreased 10.4% year over year.
Adjusted operating loss totaled $10.5 million compared with the prior-year quarter’s adjusted operating loss of $7.5 million.
Financial Position
Inogen exited third-quarter 2023 with cash and cash equivalents of $124.6 million compared with $167.7 million at the second-quarter end.
The company ended the quarter with no debt on its balance sheet.
Cumulative net cash used in operating activities at the end of third-quarter 2023 was $0.1 million compared with $22.1 million a year ago.
Guidance
Inogen has reiterated its revenue outlook for the full year.
The company continues to expect its total revenues between $315 million and $320 million. The Zacks Consensus Estimate currently stands at $317.7 million.
Our Take
Inogen exited the third quarter of 2023 with better-than-expected revenues. The robust year-over-year uptick in rental revenues and international business-to-business sales was impressive. The expansion of the adjusted gross margin also bodes well.
In September, Inogen completed the acquisition of Physio-Assist SAS, which expanded its global respiratory care presence by addressing a sizeable, growing and underserved airway clearance market opportunity. On the earnings call, management confirmed that it secured the reimbursement approval for Rove 6 in France in August. Inogen is currently focused on introducing Rove 6 to key customers in that market. These developments look promising for the stock.
Yet, wider-than-expected loss per share and dismal year-over-year top-line and bottom-line performances were worrying. A decline in domestic business-to-business and domestic direct-to-consumer sales was concerning as well. Inogen continued to incur operating losses for the third quarter, which did not bode well.
Zacks Rank and Key Picks
Inogen currently has a Zacks Rank #3 (Hold).
Some better-ranked stocks in the broader medical space that have announced quarterly results are Abbott Laboratories ABT, DexCom, Inc. DXCM and Integer Holdings Corporation ITGR.
Abbott, carrying a Zacks Rank of 2 (Buy), reported third-quarter 2023 adjusted earnings per share (EPS) of $1.14, beating the Zacks Consensus Estimate by 3.6%. Revenues of $10.14 billion outpaced the consensus mark by 3.6%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Abbott has a long-term estimated growth rate of 5.1%. ABT’s earnings surpassed estimates in all the trailing four quarters, the average surprise being 6.8%.
DexCom reported third-quarter 2023 adjusted EPS of 50 cents, beating the Zacks Consensus Estimate by 47.1%. Revenues of $975 million surpassed the Zacks Consensus Estimate by 4%. It currently carries a Zacks Rank #2.
DexCom has a long-term estimated growth rate of 33.6%. DXCM’s earnings surpassed estimates in all the trailing four quarters, the average surprise being 36.4%.
Integer Holdings reported third-quarter 2023 adjusted EPS of $1.27, beating the Zacks Consensus Estimate by 20.9%. Revenues of $404.7 million surpassed the Zacks Consensus Estimate by 8.7%. It currently carries a Zacks Rank #2.
Integer Holdings has a long-term estimated growth rate of 15.8%. ITGR’s earnings surpassed estimates in all the trailing four quarters, the average surprise being 11.9%.
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
Abbott Laboratories (ABT) : Free Stock Analysis Report
DexCom, Inc. (DXCM) : Free Stock Analysis Report
Inogen, Inc (INGN) : Free Stock Analysis Report
Integer Holdings Corporation (ITGR) : Free Stock Analysis Report
