Good day ladies and gentlemen and welcome to the Inogen 2017 First Quarter Financial Results Conference Call and Webcast. At this time all participants are in a listen-only mode. Later we will conduct a question-and-answer session and instructions will be given at that time. [Operator Instructions]. As a reminder this conference call is being recorded. I would now like to introduce your host for today's conference, Jim [ph]. Sir, you may begin.

It sounds like Jim Mores [ph] having some technical difficulties, so I… [Technical Difficulty] future financial results and market trends and opportunities, including among others, statements regarding our Inogen One G4 rollout, expectations for international sales and anticipated patient preference; market opportunities and increased use of portable oxygen concentrators, our ability to continue revenue growth and our expectations for our business-to-business and direct-to-consumer sales channel; our strategic focus and objectives, hiring expectations, expectations regarding timing of reprocessing and claims associated with 21st Century Cures Act, estimates of patent defense expenses, expectations regarding our new facility in Europe, expectations to open a new facility in Cleveland, Ohio, in 2017, including with respect to expected tax credits and incentives from state and local governments, the expected impact of our European acquisition, implementation of a new customer relationship made in the second quarter of 2017 including with respect to its short-term and long-term impact to productivity and 2017 guidance including revenue, net income, adjusted net income, adjusted EBITDA, net cash flow the need for equity financing, effective tax rate, tax benefits and adjustments and the expected cadence of our quarterly revenue for 2017. These statements are forward-looking and are subject to substantial risks and uncertainties that may cause actual events or results to differ materially from currently anticipated events or results. Information on these and additional risk [Technical Difficulty] statements in this call are based on information available to us as of today's date May 9, 2017 and we disclaim any obligation to update any forward-looking statements except as required by law. During the call, we will also present certain financial measures on a non-GAAP basis. Management believes that non-GAAP financial measures taken in conjunction with U.S. GAAP financial measures provide useful information for both management and investors by excluding certain non-cash and other expenses that are not indicative of Inogen's core operating results. Management use these non-GAAP measures to compare Inogen's performance relative to forecast and strategic plants to benchmark Inogen's performance externally against competitors and first or in compensation decisions. Reconciliations between the U.S. GAAP and non-GAAP results are presented in tables accompanying our earnings release which can be found in the Investor Relations section of our website. For future periods we have not reconciled our non-GAAP guidance to our most recently comparable U.S. GAAP measures because the timing and amount of material items that impact these measures are inherently unpredictable or out of our control. Accordingly, we cannot provide a quantitative reconciliation of these non-GAAP measures without unreasonable effort. I will now turn the call over to Scott Wilkinson. Scott?

Thanks, Ali. Good afternoon and thank you for joining our first quarter 2017 conference call. Looking at the first quarter of 2017, we build on our success in prior quarters and we saw solid performance with revenues of $52.5 million. [Technical Difficulty] and adjusted EBITDA of $10.9 million, which represented 153.3% and 34% growth respectively over the first quarter of 2016. We are continuing to scale sales of our newest product the Inogen One G4, investment sales force additions and implement our new customer relationship management or CRM software system, while delivering solid bottom-line results. And we did this in spite of the rental reimbursement headwinds. Looking at our revenue streams in more detail, we saw strong demand for our portfolio of innovative auction concentrators across all of our sales channels in the first quarter of 2017. We are very pleased with our domestic business-to-business sales in the first quarter of 2017, which increased 84.2% over the first quarter [Technical Difficulty] of the domestic business-to-business channels total sales revenue in the first quarter of 2017.

Just pausing for a second, I am hearing reports that the phone is going in and out NASDAQ can you confirm the phone is working.

I am can hear you currently but we are having audio issues cutting in and out. So we might need to hold for one moment. Ladies and gentlemen please standby, the conference will begin again momentarily. Ladies and gentlemen thank you for your patients. Once again I’ll introduce Mr. Ismel [ph] for Inogen’s 2017 first quarter financial results conference call. Sir, you may begin.

Thank you for participating in today’s call. Joining me from Inogen, is CEO, Scott Wilkinson; and CFO and Co-Founder, Ali Bauerlein. Earlier today, Inogen released financial results for the first quarter of 2017. This earnings release and Inogen's corporate presentation are currently available in the Investor Relations section of the company's website. During the call and the subsequent Q&A session, we will be discussing plans and projections for our business; future financial results and market trends and opportunities, including among others, statements regarding our Inogen One G4 rollout, expectations for international sales and anticipated patient preference. Market opportunities and increased use of portable oxygen concentrators, our ability to continue revenue growth and our expectations for our business-to-business and direct-consumer sales channel. Our strategic focus and objectives, hiring expectations, expectations regarding timing of reprocessing of claims associated with the 21st Century Cures Act, estimates of patent defense expenses, expectations regarding our new facility in Europe, expectations to open the new facility in Cleveland, Ohio in 2017 including with respect to expected tax credit and incentives from state and local governments. The expected impact of our European acquisition, implementation of a new customer relationship management system in the second quarter of 2017 including with respect to its short-term and long-term impact to productivity on our 2017 guidance including revenue, net income, adjusted net income, adjusted EBITDA, net cash flow, the need for equity financing, effective tax rates, tax benefits and adjustments and the expected cadence of our quarterly revenue for 2017. These statements are forward looking and are subject to substantial risks and uncertainties that may cause actual events or results to differ materially from currently anticipated events or results. Information on these and additional risks, uncertainties and other information affecting Inogen's business operating results are contained in Inogen's quarterly report on…

Thanks, Jimar [ph]. Good afternoon and thank you for joining our first quarter 2017 conference call. Looking at the first quarter 2017 we build on our success in prior quarters and we saw solid performance with revenues of $52.5 million. This represented 22.1% growth over the same period last year, reflecting great results in our domestic business-to-business sales channel, strong results in our direct-to-consumer sales channel and solid increases in our international business to business sales channel. And as we’ve seen in prior quarters expected decline in rental revenue was more than offset by the increases in revenue from our business-to-business and direct-to-consumer sales channels. In the first quarter of 2017, we delivered net income of $5.9 million and adjusted EBITDA of $10.9 million, which represents 135.3% and 34% growth respectively over the first quarter of 2016. We are continuing to scale sales of our newest product, the Inogen one G4, invest in sales force additions and implement our new customer relationship management or CRM software system, while delivering solid bottom line results. And we did this in spite of the rental reimbursement headwinds. Looking at our revenue streams in more detail, we saw strong demand for our portfolio of innovative auction concentrators across all of our sales channels in the first quarter of 2017. We are very pleased with our domestic business-to-business sales in the first quarter of 2017, which increased 84.2% over the first quarter of 2016. Business-to-business sales was our largest revenue channel for the first time in the first quarter of 2017 and growth here was primarily due to purchases from traditional home medical equipment providers and strong private label demand. We continue to see more traditional HME providers turning to portable oxygen concentrators to lower their operating costs in the phase of reimbursement reductions and…

Thanks, Scott and good afternoon, everyone. During my prepared remarks I will review the details of our first quarter of 2017 financial performance and then I will review our guidance for 2017. As Scott noted, total revenue for the first quarter of 2017 was $52.5 million, representing 22.1% growth over the first quarter of 2016. Looking at each of our revenue streams and turning first to our sales revenue, total sales revenue of $46 million represented 87.6% of total revenue in the first quarter of 2017 and reflected 40.1% growth over the same quarter of the prior year. Total units sold increased to 25,600 in the first quarter of 2017, up 50.6% from 17,000 in the first quarter of 2016. Strong domestic business-to-business sales of $17.5 million in the first quarter of 2017, reflected 84.2% growth over the first quarter of 2016, with strong demand from our traditional HME providers and our private label partners. We also demonstrated solid international business-to-business sales of $11.4 million in the first quarter of 2017, primarily driven by demand from our European and South Korean partners. Sales in Europe represented the majority of international sales at 73.2% in the first quarter of 2017, which was down from 90.8% in the first quarter of 2016, primarily due to the addition of South Korea and increasing sales in Canada. With strong business-to-business sales again in the first quarter of 2017, average business-to-business selling prices declined over the same period in the prior year, primarily due to the shift in sales towards traditional home medical equipment providers and private label sales, and additional discounts associated with increased sales volumes worldwide. Direct-to-consumer sales for the first quarter of 2017 were $17.1 million, representing 27.8% growth over the first quarter of 2016, primarily due to increase in consumer awareness…

[Operator Instructions] Our first question comes from Margaret Kaczor with William Blair. Your question please.

First question from me is on the large growth obviously you guys saw on the B2B domestic channel, can you guys give us any additional clarity beyond what you said on the call regarding how much the growth ended being in the private label versus [Technical Difficulty].

Margaret we’re not sure we caught the full question.

Apologies it looks like Ms. Blair’s line has been interrupted. If you would like we can move on to another line, while we wait for Ms. Blair to queue backup?

Yes I don’t I know.

Sounds like she’s back.

Okay I’ll try it again, in terms of the B2B domestic growth what were the drivers of that and are you seeing any signs in the field where you would assume that that growth would slow or accelerate?

Yes so I think we kind of call out in that B2B bucket at least in this call the growth was driven by the traditional HME providers that buy directly from Inogen as well as our private label partner that sells to other home care providers. The growth I’ll say was robust in both of those buckets. Now we don’t generally break those out individually, but the two of them combined were more than half of the total sales in our HME bucket, the other third leg of that stool being the internet resellers. So those two were more than half, the growth was robust in both of those buckets. And I think it’s fair to say at this point now that we have a little bit more time under our belt here is as far as HME is trialing, experimenting, trying to understand more POCs fit into their business in the phase of reimbursement decline. We’re seeing pretty steady progress in those trials, in that transition. And it supports our long-term belief that POCs will eventually become the standard of care for oxygen therapy. So I mean there’s nothing changed in our expectation. I will caution you Margaret and everyone to really repeat what I’ve said in the past. I think this transition will be a process not an event. I know we get a lot of questions about do you think we’re at the hockey stick and is this the tipping point. I'm not sure there is such a point, I think it’s going to be a process where you’re going to see a curve that can [Technical Difficulty] certainly if you look in the rear view mirror over the last 18 to 24 months that’s what we’ve seen. We expect that to continue.

And our next question comes from Robbie Marques with JP Morgan. Your question please. All right it seems like we’re still having audio issues as well would you like just to end the call for now?

Sure so we thank everybody for the time. We will be available for follow-up calls given that we couldn’t take Q&A in this session. So please feel free to reach out as needed for additional follow-up questions. Thank you for your time.

Ladies and gentlemen apologies, this does include today’s conference. Thank you very much for your participation and your patience. You may now disconnect.