Inogen, Inc. Quarterly report pursuant to Section 13 or 15(d)

Quarterly report pursuant to Section 13 or 15(d)

Summary of Significant Accounting Policies (Tables)

Summary of Significant Accounting Policies (Tables)

6 Months Ended

Jun. 30, 2015

Summary of Fair Value Assets Measured on Recurring Basis

The following table summarizes fair value measurements by level for the assets measured at fair value on a recurring basis:

As of December 31, 2014	Level 1		Level 2		Level 3		Total
Certificates of deposit	$	—	$	11,633	$	—	$	11,633
Total assets	$	—	$	11,633	$	—	$	11,633


As of June 30, 2015	Level 1		Level 2		Level 3		Total
Certificates of deposit	$	—	$	23,587	$	—	$	23,587
Total assets	$	—	$	23,587	$	—	$	23,587

Breakdown of Company's Revenue from U.S. and Non-U.S. Sources

A portion of revenue is earned from sales outside the United States. Approximately 70% of the non-U.S. revenue for the three months and six months ended June 30, 2015 was invoiced in euros. We did not begin to invoice in euros until the fourth quarter of 2014. A breakdown of the Company’s revenue from U.S. and non-U.S. sources for the three months and six months ended June 30, 2015 and June 30, 2014 is as follows:

	Three months ended June 30,				Six months ended June 30,
	2015		2014		2015		2014
U.S. revenue	$	33,458	$	24,237	$	58,812	$	43,424
Non-U.S. revenue		10,571		6,156		18,969		10,602
Total revenue	$	44,029	$	30,393	$	77,781	$	54,026

Schedule of Inventories

Inventories consist of the following:

	June 30,			December 31,
	2015			2014
Raw materials and work-in-progress	$	8,118		$	6,774
Finished goods		1,358			983
Less: reserves		(168	)		(141	)
Inventories	$	9,308		$	7,616

Computation of Depreciation and Amortization using Straight Line Method Over Estimated Useful Lives of Assets

Property and equipment are stated at cost. Depreciation and amortization are calculated using the straight-line method over the assets’ estimated useful lives as follows:

Rental equipment		1.5-5 years
Manufacturing equipment and tooling		5 years
Computer equipment and software		3 years
Furniture and equipment		3-5 years
Leasehold improvements		Shorter of 3-10 years or life of underlying lease

Summary of Depreciation and Amortization Expense of Property and Equipment and Rental Equipment

Depreciation and amortization expense related to property and equipment and rental equipment is summarized below for the three months ended June 30, 2015 and June 30, 2014, respectively, and for the six months ended June 30, 2015 and June 30, 2014, respectively.

	Three months ended June 30,				Six months ended June 30,
	2015		2014		2015		2014
Rental equipment	$	2,944	$	2,503	$	5,900	$	4,760
Other property and equipment		498		384		965		746
Total depreciation and amortization	$	3,442	$	2,887	$	6,865	$	5,506

Summary of Property Plant and Equipment and Rental Equipment with Associated Accumulated Depreciation

Property and equipment and rental equipment with associated accumulated depreciation is summarized below for June 30, 2015 and December 31, 2014, respectively.

	June 30,		December 31,
Property and equipment	2015		2014
Rental equipment, net of allowance	$	52,597	$	48,359
Other property and equipment		10,663		9,408
Property and equipment		63,260		57,767

Accumulated depreciation
Rental equipment		25,383		21,084
Other property and equipment		5,703		4,756
Accumulated depreciation		31,086		25,840

Net property and equipment
Rental equipment		27,214		27,275
Other property and equipment		4,960		4,652
Property and equipment, net	$	32,174	$	31,927

Computation of Earnings Per Share

The computation of EPS is as follows:

	Three months ended June 30,				Six months ended June 30,
	2015		2014		2015		2014
Numerator—basic:
Net income	$	3,459	$	2,286	$	5,031	$	3,174
Less deemed dividend on redeemable convertible preferred stock		—		—		—		(987	)
Net income before preferred rights dividend		3,459		2,286		5,031		2,187
Less: undistributed earnings to preferred stock - basic		—		—		—		(438	)
Net income attributable to common stockholders - basic	$	3,459	$	2,286	$	5,031	$	1,749

Numerator—diluted:
Net income	$	3,459	$	2,286	$	5,031	$	3,174
Less deemed dividend on redeemable convertible preferred stock		—		—		—		(987	)
Net income before preferred rights dividend		3,459		2,286		5,031		2,187
Less: undistributed earnings to preferred stock - diluted		—		—		—		(393	)
Net income attributable to common stockholders - diluted	$	3,459	$	2,286	$	5,031	$	1,794

Denominator:
Weighted-average common shares - basic common stock		19,310,064		18,201,661		19,239,218		13,843,803
Weighted-average common shares - diluted common stock		20,672,414		20,146,915		20,617,342		15,826,754

Net income per share - basic common stock	$	0.18	$	0.13	$	0.26	$	0.13
Net income per share - diluted common stock	$	0.17	$	0.11	$	0.24	$	0.11
Shares excluded from diluted net income:
Stock options		582,970		—		612,970		—
Shares excluded from diluted net income		582,970		—		612,970		—
Denominator calculation from basic to diluted:
Weighted-average common shares - basic common stock		19,310,064		18,201,661		19,239,218		13,843,803
Warrants		9,663		159,475		9,657		166,455
Stock options		1,352,687		1,785,779		1,368,467		1,816,496
Weighted-average common shares - diluted common stock		20,672,414		20,146,915		20,617,342		15,826,754