Inogen, Inc

excellent job strengthening relationships with DMEs and winning tenders internationally. These results bolster our confidence in our total market approach and the strength of the image of brands. Turning to our second priority, driving profitability, where we continued to advance through operational excellence and disciplined cost management. In the second quarter, we delivered meaningful operating leverage, reducing operating expenses by approximately 5% year-over-year and generating $2.1 million in adjusted EBITDA. This is our second consecutive quarter of adjusted EBITDA profitability. It also marks the fourth adjusted EBITDA profitable quarter out of the last five, highlighting consistent execution of our strategies in disciplined expense management. As a result, we now expect to achieve full year adjusted EBITDA breakeven in 2025, supported by sustained revenue growth and disciplined spending. We remain focused on driving further improvement in the coming years as we advance towards sustainable profitability. We continued to advance our innovation pipeline this quarter with meaningful progress across our key strategic priorities. We introduced BOXY5, our latest stationary oxygen concentrator designed to expand access to high-quality therapy for long-term care patients. We also continued developments of clinical data for SIMIACs around the world and launched a new mobile digital health portal. I'll begin with VOXI5, our newest stationary oxygen concentrator. This product is a meaningful extension of our oxygen therapy portfolio, complementing our portable solutions and enabling us to serve a broader range of patients in a home care setting. Developed in collaboration with UL Medical, VOXI5 reflects the strength of a product pipeline in our ability to bring high-quality, cost-effective solutions to market. The device delivers one to five liters per minute of continuous flow oxygen in a compact, quiet, and durable form. It's a strong option for patients who need a reliable and affordable second unit for use in multiple rooms. The launch of Voxie 5 also gives our sales team another valuable tool to meet the diverse needs of patients and providers, especially in the business to business channel where we previously did not have a stationary offer. This is critical as our DMA partners generally provide new patients with both SOC and POC. And having two quality offerings will allow us to reach new customers and deepen our relationships with existing partners. We're encouraged by the early response and look forward to continued progress as the launch builds momentum in the months ahead. In addition, we initiated the groundwork for our clinical trials to support premium reimbursement, advancing our efforts towards Semiox commercialization. While there are no material updates to provide at this time, the overall efforts remain on track and we will continue to share pertinent information as appropriate. Lastly, we enhanced our digital health capabilities by launching an online patient portal as part of our InogenConnect solution. The patient portal is designed to be seamlessly integrated with our mobile application, expanding access to self-service tools that improve patient engagement and streamline operations. The platform enables patients to order supplies, track shipments, access setup resources, update insurance info, and e-sign forms, all from their phones or computers. The launch supports our commitment to enhancing patient experience. We are pleased with the positive reception by early adopters and look forward to continuing to deliver tools that improve accessibility and ease of use for patients and providers. To conclude, the innovation we delivered this quarter reflects our ongoing commitments to advancing respiratory care through meaningful product development, greater affordability, and better outcomes for patients who rely on oxygen therapy every day. With that, I will pass the call over to Mike for an overview of our financials. Mike?

Thank you, Kevin, and good afternoon, everyone. Unless otherwise stated, all financial comparisons presented refer to the prior year comparable period. Total revenue for the second quarter of 2025 was $92.3 million, an increase of 4% on a reported basis. The increase was primarily driven by higher demand in our business-to-business channels. Looking at second quarter revenue on a more detailed basis, domestic business-to-business revenue increased 19.3 percent to $25.4 million versus $21.3 million in the prior period, driven by increased demand. International business-to-business revenue increased 17.7 percent to $35.9 million compared to $30.5 million in the prior period, primarily driven by higher demand. Direct consumer sales decreased 21.1% to $17.8 million from $22.6 million in the prior period as we continue to operate with a smaller and more efficient team. We've taken meaningful steps over the last 12 to 24 months to reshape our DTC operations, focusing on efficiency and productivity to support our broader profitability goals. These changes helped drive nearly 19% sequential growth in our DTC channel, nearly double the 10% sequential improvement from the prior year. This improvement strengthens our belief that our current team operating with an updated structure is well positioned for the future. Rental revenue decreased 8.6% to $13.1 million from $14.3 million in the prior period. The decrease was primarily driven by a higher mix of lower private payer reimbursement rates. Now, I want to discuss gross margins. Total gross margin was 44.8% in the second quarter of 2025, decreasing 335 basis points from the same period in the prior year, primarily driven by increased business-to-business sales as a percentage of total revenue. On a sequential basis, gross margin increased 60 basis points driven by higher volumes. Our cost of goods sold in the quarter included premium price components, which resulted in a 121 basis points headwind to gross margin. We do not expect a material impact from these components going forward. Moving on to operating expense, in the second quarter of 2025, total operating expense decreased $47.5 million compared to $49.8 million in the prior period, representing a decrease of 4.7% primarily related to a one-time bad debt expense in the prior period. Due to the timing of planned expenses for advancement of clinical trials related to Simioxx commercialization, we expect operating expense to slightly increase in the second half as compared to the first half of the year, reflecting ongoing investments in product development and commercialization. In the second quarter of 2025, we reported a gap net loss of $4.2 million compared to a loss of $5.6 million in the prior period and loss per diluted share of 15 cents in the second quarter of 2025 versus a loss of 24 cents in the prior period. On an adjusted basis, we had a net loss of $700,000 in the second quarter of 2025 compared to a loss of $1.6 million in the prior period and an adjusted loss per diluted share of 2 cents in the second quarter of 2025 compared to a loss of 7 cents in the prior period. Adjusted EBITDA was $2.1 million in the second quarter of 2025, compared to $1.3 million in the prior period. Moving on to our balance sheet. As of June 30th, 2025, we had cash, cash equivalents, marketable securities, and restricted cash of $123.7 million with no debt outstanding. We were pleased to increase cash by $1.2 million in the quarter. We also generated $4.4 million in operating cash flow in the second quarter, a testament to the health of our business and a result of our focus on working capital optimization and expense management. On that note, I will now discuss our full year 2025 and third quarter financial outlook. We now expect full year 2025 reported revenue to be in the range of $354 million to $357 million, reflecting 6% growth at the midpoint relative to the full year 2024. For the full year 2025, we now expect to reach adjusted EBITDA breakeven. For the third quarter 2025, we expect reported revenue to be in the range of $91 million to $93 million, reflecting 4% growth at the midpoint relative to the third quarter of 2024. Given our current exemptions for certain medical devices, we continue to expect no material impact from tariffs on our gross margin and adjusted EBITDA. However, we will closely monitor developments and will share updates as appropriate. Our turnaround is progressing well with mid-single-digit top-line growth and disciplined execution. These results highlight the strength of our strategy and position us to drive sustainable performance and create long-term shareholder value. And with that, I will pass the call back to Kevin.

Thank you, Mike. We're proud of the progress made this quarter as we sharpened our focus on operational discipline, launched new products, and advanced our innovation efforts. The introduction of Oxy5 opens new doors in stationary oxygen therapy, and we continue to lay the groundwork for future growth through investments in digital health in our broader innovation pipeline. With a solid foundation in place, we're entering the second half of the year with confidence and a clear path forward. With that, operator, please open the call for questions.