Inogen cites progress amid revenue declines

GOLETA, Calif. – Inogen continues to address lingering headwinds and refine its strategy to, ultimately, position itself for a more productive 2024, said CEO Nabil Shabshab during a recent conference call. 

The company reported revenues were $17.3 million for its domestic business-to-business channel in the third quarter, a 59.4% decrease year over year. 

“We recognized revenue of $17.3 million, which was impacted by residual headwinds to our business from the share loss we experienced over the past year due to the 2022 supply chain-related volume constraints and lower price competition,” Shabshab said. “We made progress in recapturing market share, while diversifying our customer base.” 

Inogen reported total revenues were $84 million for the third quarter, a 20.3% drop compared to the same period last year. 

For the B2B business, Inogen continues to see an “overhang” in terms of access to capital and the cost of borrowing, Shabshab said. 

“I think this is ongoing,” he said. “It's becoming a little bit more moderated, but it definitely exists. Some people are engaging and providing financing or longer terms (on credit). We had indicated before, and we're still doing it now, that we work on promotional levers as required. We are not, (however), racing to the bottom of the pricing in the category. That's not healthy for anybody.”  

Inogen reported revenues were $25.1 million for its DTC channel, a 24.1% decrease, driven by lower volume due to fewer sales reps and reduced marketing spend, as the company continues to work to improve productivity and profitability. Its sales and marketing expenses were $26.1 million in the quarter, a 22.7% decrease. 

“We continue to work through it by making sure that we'll not only elevate the performance bar, but we have hiring classes that are being set up on the right training, the right tools and the right oversight in terms of sales management and discipline,” Shabshab said. “We continue to work our way to what we believe will become an optimal size of the sales force in 2024, when we stabilize that organization and drive productivity at the same time.” 

Inogen reported revenues were $16 million for its rental channel, an increase both year over year and sequentially, with about 60 sales reps working the channel. 

“Rental revenue continues to benefit from improved prescriber team productivity with increases in referrals per sales rep as compared to Q2,” he said. “We expect continued steady progress as we further optimize sales territories and core frequency to drive scale and number of prescriptions per prescriber and overall growth.”