Inogen Inc

Previous wording

our ability to efficiently integrate Physio-Assist and our ability to obtain reimbursement coverage and payment for the Physio-Assist products in the U.S.;

Current wording

our ability to efficiently integrate Physio-Assist and our ability to obtain reimbursement coverage and payment for the Simeox products in the U.S.;

Previous wording

“Inogen,” “Inogen One,” “Inogen One G3,” “G4,” “G5,” “Oxygen.Anytime.Anywhere,” “Intelligent Delivery Technology,” “Inogen At Home,” “Inogen Rove,” and the Inogen design, are registered trademarks with the United States Patent and Trademark Office of Inogen, Inc. We own pending applications for the marks “AURORA,” “Rove,” “Inogen Rove 4,” “Inogen Rove 6,” and “VOXI” with the United States Patent and Trademark Office. We own trademark registrations for the mark “Inogen” in Argentina, Australia, Bermuda, Canada, Chile, China, Columbia, Ecuador, Hong Kong, South Korea, Malaysia, Mexico, Europe (European Union Registration), the United Kingdom, Iceland, India, Indonesia, Israel, Japan, Kuwait, New Zealand, Norway, Dominican Republic, Paraguay, Peru, Philippines, Turkey, Singapore, South Africa, Switzerland, the UAE, Uruguay, and Vietnam. We own a pending application for the mark “Inogen” in Thailand. We own a trademark registration for the mark “イノジェン” in Japan. We own trademark registrations for the marks “印诺真” and “艾诺根” in China. We own trademark registrations for the mark “Inogen One” in Australia, Canada, China, South Korea, Mexico, Europe (European Union Registration), and the United Kingdom. We own a trademark registration for the mark “Satellite Conserver” in Canada. We own trademark registrations for the mark “Inogen At Home” in Europe (European Union Registration) and the United Kingdom. We own trademark registrations for the mark “G4” in Europe (European Union Registration) and the United Kingdom. We own trademark registrations for the marks “Inogen Rove 4” and “Inogen Rove 6” in Europe (European Union Registration) and the United Kingdom. We own trademark registrations for the mark “G5” in Europe (European Union Registration) and the United Kingdom. We own pending applications for the marks “Inogen Rove 4” and “Inogen Rove 6” in Canada. We own trademark registrations for the mark “Rove” in Australia, China, Colombia, Europe (European Union Registration), Indonesia, Mexico, and the United Kingdom. We own pending applications for the mark “Rove” in Argentina, Brazil, Canada, India, South Korea, and Saudi Arabia. We own trademark registrations for the mark “Inogen Rove” in Australia, China, Colombia, Europe (European Union Registration), Indonesia, Mexico, and the United Kingdom. We own pending applications for the mark “Inogen Rove” in Argentina, Brazil, Canada, India, South Korea, and Saudi Arabia. We own trademark registrations for the Inogen design in Bolivia and China. We own a trademark registration for the mark “إنوجن” in Saudi Arabia. We own a pending application for the Inogen One G5 design in Brazil. We own a pending application for “Inogen Simeox” in China. We own a trademark registration for the mark “VOXI” in Europe (European Union Registration). Other service marks, trademarks, and trade names referred to in this Quarterly Report on Form 10-Q are the property of their respective owners. “PHYSIOASSIST,” the Physio-Assist logo, “S…

Excerpt shortened here; the source contains the full paragraph.

Current wording

“Inogen,” “Inogen One,” “Inogen One G3,” “G4,” “G5,” “Oxygen.Anytime.Anywhere,” “Intelligent Delivery Technology,” “Inogen At Home,” “Inogen Rove,” “Inogen Rove 4,” and the Inogen design, are registered trademarks with the United States Patent and Trademark Office of Inogen, Inc. We own pending applications for the marks “AURORA,” “Rove,” “Inogen Rove 6,” and “VOXI” with the United States Patent and Trademark Office. We own trademark registrations for the mark “Inogen” in Argentina, Australia, Bermuda, Canada, Chile, China, Columbia, Ecuador, Hong Kong, South Korea, Malaysia, Mexico, Europe (European Union Registration), the United Kingdom, Iceland, India, Indonesia, Israel, Japan, Kuwait, New Zealand, Norway, Dominican Republic, Paraguay, Peru, Philippines, Turkey, Singapore, South Africa, Switzerland, the UAE, Uruguay, and Vietnam. We own a pending application for the mark “Inogen” in Thailand. We own a trademark registration for the mark “イノジェン” in Japan. We own trademark registrations for the marks “印诺真” and “艾诺根” in China. We own trademark registrations for the mark “Inogen One” in Australia, Canada, China, South Korea, Mexico, Europe (European Union Registration), and the United Kingdom. We own a trademark registration for the mark “Satellite Conserver” in Canada. We own trademark registrations for the mark “Inogen At Home” in Europe (European Union Registration) and the United Kingdom. We own trademark registrations for the mark “G4” in Europe (European Union Registration) and the United Kingdom. We own trademark registrations for the marks “Inogen Rove 4” and “Inogen Rove 6” in Europe (European Union Registration) and the United Kingdom. We own trademark registrations for the mark “G5” in Europe (European Union Registration) and the United Kingdom. We own pending applications for the marks “Inogen Rove 4” and “Inogen Rove 6” in Canada. We own trademark registrations for the mark “Rove” in Argentina, Australia, China, Colombia, Europe (European Union Registration), Indonesia, Mexico, Saudi Arabia, and the United Kingdom. We own pending applications for the mark “Rove” in Brazil, Canada, India, and South Korea. We own trademark registrations for the mark “Inogen Rove” in Australia, China, Colombia, Europe (European Union Registration), Indonesia, Mexico, Saudi Arabia, and the United Kingdom. We own pending applications for the mark “Inogen Rove” in Argentina, Brazil, Canada, India, and South Korea. We own trademark registrations for the Inogen design in Bolivia and China. We own a trademark registration for the mark “إنوجن” in Saudi Arabia.We own a pending application for the Inogen One G5 design in Brazil. We own a trademark registration for “Inogen Simeox” in China. We own a trademark registration for the mark “VOXI” in Europe (European Union Registration). Other service marks, trademarks, and trade names referred to in this Quarterly Report on Form 10-Q are the property of their respective owners. “PHYSIOASSIST,” the Physio-Assist logo, …

Excerpt shortened here; the source contains the full paragraph.

Previous wording

There have been no material changes in our critical accounting policies and estimates in the preparation of our consolidated financial statements during the three and six months ended June 30, 2025 compared to those disclosed in our Annual Report on Form 10-K for the year ended December 31, 2024, as filed with the SEC on February 28, 2025.

Current wording

There have been no material changes in our critical accounting policies and estimates in the preparation of our consolidated financial statements during the three and nine months ended September 30, 2025 compared to those disclosed in our Annual Report on Form 10-K for the year ended December 31, 2024, as filed with the SEC on February 28, 2025.

Previous wording

Information about recently adopted and proposed accounting pronouncements, if applicable, is included in Note 2 to our consolidated financial statements in Part I, Item 1 of this Quarterly Report on Form 10-Q under the heading “Recent Accounting Pronouncements” and is incorporated herein by reference.

Current wording

Information about recently adopted and proposed accounting pronouncements, if applicable, is included in Note 2 to our consolidated financial statements in Part I, Item 1 of this Quarterly Report on Form 10-Q under the heading “Recent Accounting Pronouncements Not Yet Adopted” and is incorporated herein by reference.

Previous wording

While we have worked to improve our global supply chain, challenges and potential disruptions still exist. We have experienced, and may continue to experience, increases in cost and limited availability of certain raw materials, components, and other inputs necessary to manufacture and distribute our products due to constraints and inflation within the global supply chain, as well as increases in wage costs and the cost and time to distribute our products. Uncertainty around inflationary pressures, interest rates, monetary policy, and changes in tariffs and tax laws could potentially cause new, or exacerbate existing, economic challenges that we may face, including the impact of foreign currency fluctuations on our results of operations, or result in an economic downturn or recession, which could negatively impact our business operations and results. Existing and future potential geopolitical dynamics may create economic, supply chain, energy, and other challenges, including disruptions to business operations, which has impacted, and may in the future negatively impact our business. In particular, international conflicts could create instability, have and may further result in sanctions, tariffs, and other measures that restrict international trade and may negatively affect our business operations and results.

Current wording

While we have worked to improve our global supply chain, challenges and potential disruptions still exist. We have experienced, and may continue to experience, increases in cost and limited availability of certain raw materials, components, and other inputs necessary to manufacture and distribute our products due to constraints and inflation within the global supply chain, as well as increases in wage costs and the cost and time to distribute our products. Uncertainty around inflationary pressures, interest rates, monetary policy, and changes in tariffs and tax laws could potentially cause new, or exacerbate existing, economic challenges that we may face, including the impact of foreign currency fluctuations on our results of operations, or result in an economic downturn or recession, which could negatively impact our business operations and results. Existing and future potential geopolitical dynamics may create economic, supply chain, energy, and other challenges, including disruptions to business operations, which has impacted, and may in the future negatively impact our business. In particular, international conflicts and disputes could create instability, have and may further result in sanctions, tariffs, and other measures that restrict international trade and may negatively affect our business operations and results.

Previous wording

We continue to monitor the tariffs announced by the U.S. government, and potential tariff modifications or the imposition of tariffs or export controls by other countries. As the tariffs are currently detailed, we do not expect a material impact to our business.

Current wording

We continue to monitor the tariffs announced by the U.S. government, as well as the potential for additional or modified tariffs, and the imposition of tariffs or export controls by other countries. As the tariffs are currently detailed, we do not expect a material impact to our business.

Previous wording

We derive the majority of our revenue from the sale and rental of our portable oxygen concentrator systems and related accessories to patients, insurance carriers, home healthcare providers, resellers, and distributors, including our private label collaborator. We sell multiple configurations of our Inogen One®, Inogen Rove and Inogen At Home systems with various batteries, accessories, warranties, power cords, and language settings. Our goal is to design, build, and market oxygen solutions that redefine how long-term oxygen therapy is delivered.

Current wording

We derive the majority of our revenue from the sale and rental of our portable oxygen concentrator systems and related accessories to patients, insurance carriers, home healthcare providers, resellers, and distributors, including our private label collaborator. We sell multiple configurations of our Inogen One®, Inogen Rove and Inogen At Home systems with various batteries, accessories, warranties, power cords, and language settings. Our goal is to design, build, and market respiratory therapy solutions that redefine how home respiratory care is delivered.

Previous wording

Expand our domestic home medical equipment, or HME, provider and reseller network. We remain focused on our domestic business-to-business partnerships, including relationships with distributors, key accounts, resellers, our private label collaborator, and traditional HME providers. We offer patient-preferred, low total cost of ownership products to help providers convert their businesses to a non-delivery POC business model. The U.S. market represents a main opportunity for growth as we believe that the POC adoption is still in a low penetration rate.

Current wording

Expand our domestic home medical equipment, or HME, provider and reseller network. We remain focused on our domestic business-to-business partnerships, including relationships with distributors, key accounts, resellers, our private label collaborator, and traditional HME providers. We offer patient-preferred, low total cost of ownership products to help providers convert their businesses to a non-delivery POC business model.

Previous wording

Invest in our oxygen product offerings to develop innovative products and expand clinical evidence. We incurred $5.2 million and $5.6 million in the three months ended June 30, 2025 and 2024, respectively, and $9.2 million and $12.2 million in the six months ended June 30, 2025 and 2024, respectively, in research and development expenses, and we intend to continue to make such investments in the foreseeable future.

Current wording

Invest in our respiratory product offerings to develop innovative products and expand clinical evidence. We incurred $4.8 million and $3.5 million in the three months ended September 30, 2025 and 2024, respectively, and $14.1 million and $15.7 million in the nine months ended September 30, 2025 and 2024, respectively, in research and development expenses, and we intend to continue to make similar investments in the foreseeable future.

Previous wording

Expand our product offerings and indications for use. We are focused on expanding new products that drive benefits to patients, prescribers and our customers with a clinically relevant pipeline. These products would include innovations that strengthen our offerings in chronic obstructive pulmonary disease, or COPD, as well as future innovations that differentiate beyond devices to allow patients and clinicians to better manage respiratory disease with advanced portable oxygen concentrators with digital health value added services, expansion of use to hypercapnia, shortness-of-breath, and to other related disease indications.

Current wording

Expand our product offerings and indications for use. We are focused on expanding new products that drive benefits to patients, prescribers and our customers with a clinically relevant pipeline. These products would include innovations that strengthen our offerings in COPD, as well as future innovations that differentiate beyond devices to allow patients and clinicians to better manage respiratory disease with advanced portable oxygen concentrators with digital health value added services, expansion of use to hypercapnia, shortness-of-breath, and to other related disease indications.

Previous wording

Our Simeox product is a technology-enabled airway clearance and mucus management device predominantly aimed at serving patients with bronchiectasis which is a condition that presents as the lung’s bronchi are damaged and widened in patients with cystic fibrosis, COPD, or other respiratory conditions. Simeox is used in pulmonary rehabilitation centers as well as at home. Simeox has been cleared under CE mark in the European Union and is currently being sold in Europe and several other markets. In addition, we obtained 510(k) clearance for Simeox in December 2024 and plan to leverage our commercial infrastructure and capabilities to market the device in the United States, while continuing to market it in the other geographies. We intend to commercialize Simeox through the sale or rental of the product initially, followed by recurring sales of device disposables. We began efforts to obtain market feedback, as well as to initialize the work towards reimbursement coverage for the Simeox product in the U.S.

Current wording

Our Simeox product is a technology-enabled airway clearance and mucus management device predominantly aimed at serving patients requiring airway clearance, such as those with bronchiectasis – a condition characterized by damaged and widened bronchi that can occur in patients with cystic fibrosis, COPD, or other respiratory conditions. Simeox is used in pulmonary rehabilitation centers as well as at home. Simeox has been cleared under CE mark in the European Union and is currently being sold in Europe and several other markets. In addition, we obtained 510(k) clearance for Simeox in December 2024 and plan to leverage our commercial infrastructure and capabilities to market the device in the United States, while continuing to market it in the other geographies. We intend to commercialize Simeox through the sale or rental of the product initially, followed by recurring sales of device disposables. We began efforts to obtain market feedback, as well as to initialize the work towards reimbursement coverage for the Simeox product in the U.S.

Previous wording

In January 2025, we entered into the Collaboration Agreement with Yuwell. The collaboration with Yuwell is expected to broaden our product portfolio through distribution of certain respiratory products, including Yuwell’s stationary oxygen concentrators, in the United States and select other territories, expand and enhance our innovation pipeline through research and development collaboration, and accelerate the entry of our brand into the Chinese market. In the United States, we initiated in June 2025 the launch of the Voxi™ 5, a new stationary oxygen concentrator designed to enhance access to high-quality oxygen therapy for long-term care patients. A more extensive launch is planned in 2026 as we focus on market development. In China, we continue to work through the registration process.

Current wording

In January 2025, we entered into the Collaboration Agreement with Yuwell. The collaboration with Yuwell is expected to broaden our product portfolio through distribution of certain respiratory products, including Yuwell’s stationary oxygen concentrators, in the United States and select other territories, expand and enhance our innovation pipeline through research and development collaboration, and accelerate the entry of our brand into the Chinese market. In the United States, we initiated in June 2025 the launch of the Voxi™ 5, a new stationary oxygen concentrator designed to enhance access to high-quality oxygen therapy for long-term care patients. A more extensive launch of this product is planned in 2026 as we focus on market development. In China, we continue to work through the registration process for our products.

Previous wording

Sales revenue increased $4.7 million, or 6.4%, for the three months ended June 30, 2025 from the three months ended June 30, 2024. The increase was primarily attributable to higher demand in domestic and international business-to-business sales. We sold approximately 49,000 oxygen systems during the three months ended June 30, 2025 compared to approximately 41,300 oxygen systems sold during the three months ended June 30, 2024, an increase of 18.6%.

Current wording

Sales revenue increased $4.2 million, or 5.6%, for the three months ended September 30, 2025 from the three months ended September 30, 2024. The increase was primarily attributable to higher demand in international and domestic business-to-business sales. We sold approximately 51,100 oxygen systems during the three months ended September 30, 2025 compared to approximately 43,900 oxygen systems sold during the three months ended September 30, 2024, an increase of 16.4%.

Previous wording

Domestic business-to-business sales increased 19.3% for the three months ended June 30, 2025 compared to the three months ended June 30, 2024, primarily due to the result of increased demand.

Current wording

Domestic business-to-business sales increased 6.6% for the three months ended September 30, 2025 compared to the three months ended September 30, 2024, primarily due to the result of increased demand.

Previous wording

International business-to-business sales increased 17.7% for the three months ended June 30, 2025 compared to the three months ended June 30, 2024, primarily due to higher demand. In the three months ended June 30, 2025, sales in Europe as a percentage of total international sales revenue slightly decreased to 85.3% from 86.7% during the comparable period in 2024.

Current wording

International business-to-business sales increased 18.8% for the three months ended September 30, 2025 compared to the three months ended September 30, 2024, primarily due to higher demand. In the three months ended September 30, 2025, sales in Europe as a percentage of total international sales revenue slightly decreased to 84.4% from 85.7% during the comparable period in 2024.

Previous wording

Domestic direct-to-consumer sales decreased 21.1% for the three months ended June 30, 2025 compared to the three months ended June 30, 2024, primarily driven by lower volume and average selling price versus the comparable period in 2024.

Current wording

Domestic direct-to-consumer sales decreased 17.9% for the three months ended September 30, 2025 compared to the three months ended September 30, 2024, primarily driven by lower volume and average selling price versus the comparable period in 2024.

Previous wording

Domestic direct-to-consumer rentals decreased 8.6% for the three months ended June 30, 2025 compared to the three months ended June 30, 2024, primarily related to a higher mix of lower private-payor reimbursement rates.

Current wording

Domestic direct-to-consumer rentals decreased 4.4% for the three months ended September 30, 2025 compared to the three months ended September 30, 2024, primarily related to a higher mix of lower private-payor reimbursement rates.

Previous wording

Cost of sales revenue increased $5.1 million, or 13.4%, for the three months ended June 30, 2025 from the three months ended June 30, 2024 due primarily to an increase in the number of systems sold.

Current wording

Cost of sales revenue increased $3.3 million, or 8.4%, for the three months ended September 30, 2025 from the three months ended September 30, 2024 due primarily to an increase in the number of systems sold.

Previous wording

Cost of rental revenue decreased $0.2 million, or 3.1%, for the three months ended June 30, 2025 from the three months ended June 30, 2024. The decrease in cost of rental revenue was primarily attributable to a decrease in logistics costs. Cost of rental revenue included $3.0 million of rental asset depreciation for the three months ended June 30, 2025 compared to $3.1 million for the three months ended June 30, 2024.

Current wording

Cost of rental revenue increased $0.3 million, or 3.2%, for the three months ended September 30, 2025 from the three months ended September 30, 2024. The increase in cost of rental revenue was primarily attributable to increased service costs. Cost of rental revenue included $3.0 million of rental asset depreciation for the three months ended September 30, 2025 compared to $3.2 million for the three months ended September 30, 2024.

Previous wording

Gross margin on sales revenue decreased to 45.1% for the three months ended June 30, 2025 from 48.5% for the three months ended June 30, 2024. The decrease was driven primarily by channel and customer mix, higher material cost premiums associated with open-market purchases of semiconductor chips used in our POCs, and adjustments in reserves. Total worldwide business-to-business sales revenue accounted for 77.5% of total sales revenue in the three months ended June 30, 2025 versus 69.6% in the three months ended June 30, 2024.

Current wording

Gross margin on sales revenue decreased to 45.7% for the three months ended September 30, 2025 from 47.2% for the three months ended September 30, 2024. The decrease was driven primarily by channel and customer mix. Total worldwide business-to-business sales revenue accounted for 80.0% of total sales revenue in the three months ended September 30, 2025 versus 74.3% in the three months ended September 30, 2024.

Previous wording

Gross margin on rental revenue decreased to 43.0% for the three months ended June 30, 2025 from 46.2% for the three months ended June 30, 2024, primarily due to a higher mix shift of private-payor reimbursement and lower net revenue per rental patient as a result of a decrease in the percentage of patients billed compared to total patients on service.

Current wording

Gross margin on rental revenue decreased to 38.7% for the three months ended September 30, 2025 from 43.2% for the three months ended September 30, 2024, primarily due to a higher mix shift of private-payor reimbursement and lower net revenue per rental patient as a result of a decrease in total patients on service.

Previous wording

Sales and marketing expense decreased $0.2 million, or 0.9%, for the three months ended June 30, 2025 from the three months ended June 30, 2024. This decrease was primarily due to a decrease of $1.1 million in media and advertising costs, partially offset by an increase of $0.8 million in personnel costs. In the three months ended June 30, 2025, we spent $7.4 million in media and advertising costs versus $8.5 million in the comparable period in 2024.

Current wording

Sales and marketing expense decreased $0.9 million, or 3.5%, for the three months ended September 30, 2025 from the three months ended September 30, 2024. This decrease was primarily due to a decrease of $0.8 million in media and advertising costs. In the three months ended September 30, 2025, we spent $7.4 million in media and advertising costs versus $8.2 million in the comparable period in 2024.

Previous wording

General and administrative expense decreased $1.7 million, or 9.1%, for the three months ended June 30, 2025 from the three months ended June 30, 2024, primarily due to decreases of $1.0 million in bad debt expense and $0.6 million in the change in fair value of the earnout liability, respectively.

Current wording

General and administrative expense decreased $1.1 million, or 5.7%, for the three months ended September 30, 2025 from the three months ended September 30, 2024, primarily due to decreases of $1.5 million in bad debt expense and $0.7 million in the change in fair value of the earnout liability, partially offset by an increase of $1.8 million in legal settlement costs.

Previous wording

Income tax benefit increased $0.1 million, or 2,085.7%, for the three months ended June 30, 2025 from the three months ended June 30, 2024. We continued to record a valuation allowance on the use of deferred tax assets in the current and prior periods. The decrease was attributable to lower foreign and state taxes.

Current wording

Income tax benefit increased less than $0.1 million, or 44.6%, for the three months ended September 30, 2025 from the three months ended September 30, 2024. We continued to record a valuation allowance on the use of deferred tax assets in the current and prior periods. The increase was attributable to lower foreign and state taxes.

Previous wording

On July 4, 2025, the One Big Beautiful Bill Act (“OBBBA”) was enacted into law. OBBBA provides for significant U.S. tax law changes and modifications. We are evaluating the potential effects of the new legislation, but we expect the legislation will likely not have a material impact on our financial statements. No adjustments have been made to the consolidated financial statements as of and for the period ended June 30, 2025, in relation to this legislation.

Current wording

On July 4, 2025, the OBBBA was enacted into law. The OBBBA provides for significant U.S. tax law changes and modifications. The impacts of the new legislation did not have a material impact on our financial statements and are included in the consolidated financial statements as of and for the period ended September 30, 2025.

Previous wording

Net loss decreased $1.4 million, or 25.7%, for the three months ended June 30, 2025 from the three months ended June 30, 2024. The decrease in net loss was primarily related to an increase in sales revenue and lower operating expense.

Current wording

Net loss decreased $0.7 million, or 11.2%, for the three months ended September 30, 2025 from the three months ended September 30, 2024. The decrease in net loss was primarily related to an increase in sales revenue and lower operating expense.

Previous wording

Sales revenue increased $10.1 million, or 7.4%, for the six months ended June 30, 2025 from the six months ended June 30, 2024. The increase was primarily attributable to higher demand in domestic and international business-to-business sales. We sold approximately 92,000 oxygen systems during the six months ended June 30, 2025 compared to approximately 75,200 oxygen systems sold during the six months ended June 30, 2024, an increase of 22.3%.

Current wording

Sales revenue increased $14.3 million, or 6.7%, for the nine months ended September 30, 2025 from the nine months ended September 30, 2024. The increase was primarily attributable to higher demand in international and domestic business-to-business sales. We sold approximately 143,100 oxygen systems during the nine months ended September 30, 2025 compared to approximately 119,100 oxygen systems sold during the nine months ended September 30, 2024, an increase of 20.2%.

Previous wording

Domestic business-to-business sales increased 23.9% for the six months ended June 30, 2025 compared to the six months ended June 30, 2024, primarily due to the result of increased demand.

Current wording

Domestic business-to-business sales increased 17.3% for the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024, primarily due to the result of increased demand.

Previous wording

International business-to-business sales increased 20.1% for the six months ended June 30, 2025 compared to the six months ended June 30, 2024, primarily due to higher demand. In the six months ended June 30, 2025, sales in Europe as a percentage of total international sales revenue decreased to 85.5% from 87.4% during the comparable period in 2024.

Current wording

International business-to-business sales increased 19.6% for the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024, primarily due to higher demand. In the nine months ended September 30, 2025, sales in Europe as a percentage of total international sales revenue decreased to 85.1% from 86.8% during the comparable period in 2024.

Previous wording

Domestic direct-to-consumer sales decreased 23.8% for the six months ended June 30, 2025 compared to the six months ended June 30, 2024, primarily driven by lower volume and average selling price versus the comparable period in 2024.

Current wording

Domestic direct-to-consumer sales decreased 22.0% for the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024, primarily driven by lower volume and average selling price versus the comparable period in 2024.

Previous wording

Domestic direct-to-consumer rentals decreased 8.0% for the six months ended June 30, 2025 compared to the six months ended June 30, 2024, primarily related to a higher mix of lower private-payor reimbursement rates.

Current wording

Domestic direct-to-consumer rentals decreased 6.9% for the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024, primarily related to a higher mix of lower private-payor reimbursement rates and fewer patients on service.

Previous wording

Cost of sales revenue increased $8.0 million, or 10.9%, for the six months ended June 30, 2025 from the six months ended June 30, 2024 due primarily to an increase in the number of systems sold.

Current wording

Cost of sales revenue increased $11.3 million, or 10.0%, for the nine months ended September 30, 2025 from the nine months ended September 30, 2024 due primarily to an increase in the number of systems sold.

Previous wording

Cost of rental revenue decreased $0.8 million, or 5.1%, for the six months ended June 30, 2025 from the six months ended June 30, 2024. The decrease in cost of rental revenue was primarily attributable to a decrease in logistics costs. Cost of rental revenue included $6.1 million of rental asset depreciation for the six months ended June 30, 2025 compared to $6.3 million for the six months ended June 30, 2024.

Current wording

Cost of rental revenue decreased $0.6 million, or 2.4%, for the nine months ended September 30, 2025 from the nine months ended September 30, 2024. The decrease in cost of rental revenue was primarily attributable to a decrease in logistics costs and depreciation. Cost of rental revenue included $9.0 million of rental asset depreciation for the nine months ended September 30, 2025 compared to $9.6 million for the nine months ended September 30, 2024.

Previous wording

Gross margin on sales revenue decreased to 44.8% for the six months ended June 30, 2025 from 46.5% for the six months ended June 30, 2024. The decrease was driven primarily by channel and customer mix and higher material cost premiums associated with open-market purchases of semiconductor chips used in our POCs, partially offset by lower warranty expense. Total worldwide business-to-business sales revenue accounted for 77.7% of total sales revenue in the six months ended June 30, 2025 versus 68.6% in the six months ended June 30, 2024.

Current wording

Gross margin on sales revenue decreased to 45.1% for the nine months ended September 30, 2025 from 46.7% for the nine months ended September 30, 2024. The decrease was driven primarily by channel and customer mix and higher material cost premiums associated with open-market purchases of semiconductor chips used in our POCs, partially offset by lower warranty expense. Total worldwide business-to-business sales revenue accounted for 78.5% of total sales revenue in the nine months ended September 30, 2025 versus 70.6% in the nine months ended September 30, 2024.

Previous wording

Gross margin on rental revenue decreased to 43.2% for the six months ended June 30, 2025 from 44.9% for the six months ended June 30, 2024, primarily due to a higher mix shift of private-payor reimbursement and lower net revenue per rental patient as a result of a decrease in the percentage of patients billed compared to total patients on service.

Current wording

Gross margin on rental revenue decreased to 41.7% for the nine months ended September 30, 2025 from 44.4% for the nine months ended September 30, 2024, primarily due to a higher mix shift of private-payor reimbursement and lower net revenue per rental patient as a result of a decrease in total patients on service.

Previous wording

Research and development expense decreased $3.0 million, or 24.2%, for the six months ended June 30, 2025 from the six months ended June 30, 2024. This decrease was due primarily to a $2.4 million decrease in consulting expense.

Current wording

Research and development expense decreased $1.6 million, or 10.4%, for the nine months ended September 30, 2025 from the nine months ended September 30, 2024. This decrease was due primarily to a $1.3 million decrease in consulting expense.

Previous wording

Sales and marketing expense decreased $3.4 million, or 6.5%, for the six months ended June 30, 2025 from the six months ended June 30, 2024. This decrease was primarily due to decreases of $1.9 million in media and advertising costs and $1.4 million in consulting fees. In the six months ended June 30, 2025, we spent $15.0 million in media and advertising costs versus $17.0 million in the comparable period in 2024.

Current wording

Sales and marketing expense decreased $4.3 million, or 5.5%, for the nine months ended September 30, 2025 from the nine months ended September 30, 2024. This decrease was primarily due to decreases of $2.8 million in media and advertising costs, $1.5 million in consulting fees, and $0.7 million in credit card and financing fees, partially offset by an increase of $0.7 million in personnel costs. In the nine months ended September 30, 2025, we spent $22.4 million in media and advertising costs versus $25.2 million in the comparable period in 2024.

Previous wording

General and administrative expense decreased $2.6 million, or 7.3%, for the six months ended June 30, 2025 from the six months ended June 30, 2024, primarily due to decreases of $1.2 million in the change in fair value of the earnout liability and $1.1 million in bad debt expense, respectively.

Current wording

General and administrative expense decreased $3.7 million, or 6.7%, for the nine months ended September 30, 2025 from the nine months ended September 30, 2024, primarily due to decreases of $2.6 million in bad debt expense, $1.8 million in the change in fair value of the earnout liability, and $0.8 million in acquisition-related expenses, respectively. These decreases were partially offset by an increase of $1.8 million in legal settlement costs.

Previous wording

Total other income, net increased $0.4 million, or 24.3%, for the three months ended June 30, 2025 from the three months ended June 30, 2024.

Current wording

Total other income, net increased $0.1 million, or 3.0%, for the nine months ended September 30, 2025 from the nine months ended September 30, 2024.

Previous wording

Income tax benefit increased less than $0.1 million, or 59.2%, for the six months ended June 30, 2025 from the six months ended June 30, 2024. We continued to record a valuation allowance on the use of deferred tax assets in the current and prior periods. The decrease was attributable to lower foreign and state taxes.

Current wording

Income tax benefit increased $0.1 million, or 53.5%, for the nine months ended September 30, 2025 from the nine months ended September 30, 2024. We continued to record a valuation allowance on the use of deferred tax assets in the current and prior periods. The decrease was attributable to lower foreign and state taxes.