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Sep 30, 2020
Inogen Q3 2020 Earnings Report
Inogen's financial performance declined due to the impact of COVID-19, but rental revenue increased.
Key Takeaways
Inogen reported a decrease in total revenue by 19% compared to Q3 2019, primarily due to the COVID-19 pandemic, which led to reduced patient travel and activity outside the home, reduced consumer confidence, and physicians limiting patient interactions. However, the company saw sequential revenue growth from Q2 2020 and strong growth in rental revenue.
Total revenue decreased by 19.0% year-over-year to $74.3 million, but increased 3.7% sequentially from Q2 2020.
Rental revenue increased by 40.1% year-over-year to $7.5 million.
The company reported a net loss of $1.7 million.
Cash, cash equivalents, and marketable securities totaled $220.5 million with no debt.
Revenue by Segment
Forward Guidance
Due to unprecedented market uncertainties, the Company is still unable to provide guidance for the full year 2020 or 2021. The company expects that the COVID-19 pandemic will continue to have an adverse impact on its business in the fourth quarter of 2020 and that revenue in the fourth quarter of 2020 will be down compared to the third quarter of 2020, primarily due to the seasonality in its business and the impacts of the COVID-19 PHE.
Positive Outlook
- The Company plans to continue to make investments to broaden its product portfolio with the use of the recently acquired New Aera technology.
- The Company plans to build the necessary infrastructure to support its focus on rentals.
- The Company expects increased operating expenses in the remainder of 2020 and 2021 due to investment initiatives.
- The Company expects Medicare rates will not change for the length of the COVID-19 PHE, except for the 2% Medicare sequestration that will go back into effect on January 1, 2021, and any net change for inflation and budget neutrality adjustments that typically occur annually each January.
- CMS announced that competitive bidding contracts that were scheduled to go into effect on January 1, 2021 will not be awarded for most product categories, including oxygen.
Challenges Ahead
Revenue & Expenses
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Historical Earnings Impact
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Avg. Return Before/After Earnings
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