Inogen sees recovery, but supply chain constraints pile up

GOLETA, Calif. – Inogen reported total revenue of $101.6 million for the second quarter of 2021, a 41.7% increase compared to the same period in 2020, primarily due to strong consumer demand, improved average selling prices in all channels and reduced COVID-19 pandemic-related impacts.

The company reported domestic direct-to-consumer revenue of $40.9 million, a 35.6% increase. Rental revenue was $11.3 million, an 85.2% increase.

“We saw strong revenue growth of 41.7% as compared to the second quarter of 2020, when the COVID-19 pandemic drove a significant negative impact on our business,” said Nabil Shabshab, president and CEO. “We are pleased with our recovery in our core business. Demand and average selling prices for portable oxygen concentrators increased primarily due to higher consumer confidence and higher COVID-19 vaccination rates, leading to increased patient ambulation in the second quarter of 2021.”

Inogen reported an operating income of $11.7 million for the second quarter, adjusted EBITDA of $12.4 million, net income of $5.1 million and earnings per diluted common share of $0.22.

Inogen expects revenue growth constraints and a higher cost of goods sold per unit starting in the third quarter of 2021, however, until the availability of semiconductor chips improves.

“While we are confident in the underlying strength of our business, we are navigating rising costs and supply chain constraints like many companies across the globe,” Shabshab said. “The semiconductor chip shortage is impacting our ability to supply our customers with batteries and portable oxygen concentrators.”

Inogen expects total revenue in the second half of 2021 to be lower than the first half of 2021, with the largest negative impact on its domestic business-to-business channel. It expects net losses in both the third and fourth quarters and a net loss for full year 2021, reflecting the anticipated supply constrained revenue decline, increased cost of goods sold per unit and higher operating expense in the second half of 2021 compared to the first half of the year.