OptimizeRx (OPRX) 8 Aug 242024 Q2 Earnings call transcript

Good afternoon, everyone, and thank you for joining OptimizeRx's Second Quarter Fiscal 2024 Earnings Call. With us today is the Chief Executive Officer of OptimizeRx, William Febbo. He is joined by Chief Financial Officer, Ed Stelmakh; President, Steve Silvestro; General Counsel of Marion Odence-Ford; and Senior President of Corporate Finance, Andrew D'Silva. At the conclusion of today's earnings call, I will provide important cautions regarding the forward-looking statements made by management during today's call.

remind be today's via made to recorded, is webcast like will and available would everyone call that being only. I for replay the company's included section are in press and Instructions today's of website. in the release Investors

Now CEO, go Febbo. OptimizeRx over William to I'd Sir, turn like call to the ahead. please

to and second joining quarter XXXX Thank you, everyone operator, earnings good afternoon today's call.

revenue midpoint. adjusted growth, operations and While was from EBITDA, fell result we timing flow we welcome of consensus DAAP positive issue of XX% cash to expectations short primarily a with on year-over-year date. This our beat for and deals revenue the a largest one

We are into pipeline DAAP in having converting our closed deals. success

required would the quarter. in take market, innovative However, because into additional new allow the DAAP all revenue there the is the items close us to out pharma to that approvals solution customer are at the

were We get to everything didn't documented with we quarter. the but before of clients working hard end there get it our the

said, I getting us have proprietary preferred is with this we and solution and marketing. to network clients As being brand our momentum DAAP partner embraced Pharma's closer partners and that are building for our

particularly and in process. 'XX approximately multi-brand approval DAAP million QX $X and slightly program commercial to aware, their industry clients with due of multimillion you're an forward multifunctional longest-standing this was particular runs for In we to close. deals, moving our launch to approvals, all through committed As delayed dollar needed as these internal that approvals new pharma tactics additional internal one got instance, in

the and completed in timing transaction taken of we're illustrates the forward shift I expectations the surpassed second power we full we approval its top But conversion had news half great of that well to as with place. have moving contract revenue DAAP size not complete and the is of nearly the now with is the approvals as this bottom would be to QX customer expect in platform. consensus believe on XXXX. This the the process

remain over clear convert second to significant and our momentum have to DAAP. we continues we the since to initiative objective currently many clients of XXXX, this who as tremendous with of and brands made Our have half very with want to seen progress support to the DAAP XXX convert

the number With a to establish have over as pricing more a sticker to consistent more we deals way lumpy consistent mechanism, continues our making enough accumulated time. grow, of recognition knowledge less and revenue market

QX, our rolling the We are process evolution in we continue these pharma strategic to companies out parter the in as along of changes as top world. a in these out, the

$X.X seen believe of top top spending our they not In continue clients fact, a which separation revenue from their with in larger client clients X in average $X.X half with million to the pharma year. we value is pharma with the an revenue -- as material average versus while We are between their issue, seeing testament timing dealing solutions a our our commercial share per clients our wallet the XX see OptimizeRx. of are top of pullback we've clients to we a we the at million, second to on award our

which engage platform, an is about not largest clients' our being our our and It's seamlessly. to compliant just eligible our methodology, Supported yielding solid ROIs It's and challenge media. targeting about machine precise amazing learning a by by and brand ability address delighting today. technology clients purchasing team and to positive momentum driven a patients with is find

timely with interoperability accurately manner. insights HCP solutions capability in scalable points adoption back and to looking We report pharma are seeing reach, both DTC and of continued is customer multiple a partners as across care with for

in we the brands we converting quarter, success X Since of in that DAAP. seen are including XX the sticky, gross support high deals closed the to a and very a $X engagements, margin we XX, deals, second half a generally closed for our the second In more These half are DAAP of ROI, on higher contract have XXX-plus deals building accelerated we've value which enjoy to direct in pharma first business XX million. XXXX, the annualized of continue around support higher 'XX.

growth our DAAP said, have Of we this business. tactical to business provide well launches to into new first of that overall our a the of not we DTC As the clear for cross-sell will year. second XXXX from the enhanced for to our note, takes place months planning ability the closed reallocations, as half DAAP and last longer-term the and commercial all as convert view the and potential of year-end a the side renewals, approach X in tracking of leadership team program. for mention

We are date. ready with our team best to

shared as messaging technologies point-of-care coming In XX% late-stage company create dynamic of business have our for is across numerous both in leading of side deals clients. and to DTC the OptimizeRx previously, addition, our with opportunities network we in audiences dozens combined from with negotiations. pipeline. the a approximately proprietary And remains DAAP execute

focused fine-tune and see executing thesis to of maximize to and its continue cross-selling to HCP to revenue platform more potential. the We the DTC clients our our continuing of key business. as against growth The is driving driver on organic team our

fall Given this $XX year possible. revenue point our we rate year current ] traditional have We this of remaining the XX% conversion, within for at close [ guidance believe Go approximately second view consensus is our have for over Get and the and million the expectations. for an to pipeline half

as the move keep will we through date year. to up everyone We

CFO, our to Ed would the call over will us And Stelmakh, Ed? our like to with turn that, details. I through who walk financial

was June our Investor available of be good Relations forthcoming our of ended a XXXX, may with and press quarter obtained our and everyone. be website. downloaded the information through from Will, Thanks, additional for XX-Q. and financial issued copy section can the afternoon, release second The XX, results is viewing And

XXXX. at came revenue quarter increase recognized $XX.X of Second period the XX% million, the an from in in same million we during $XX.X

in the ended for the expansion DAAP-related as increased XX.X% XX, XX, XX.X% to channel well June XXXX, to from margin the is revenue ended margin as June gross quarter favorable tied a Gross Year-on-year partner XXXX. higher quarter The in quarter mix.

Our increased operating expenses the year-over-year, for quarter June by Medicx due million XX, the $X.X acquisition. ended to XXXX, largely cost

the income period of non-GAAP net quarter same of $X diluted a in net basis, basic diluted XXXX fully diluted million share a $X.XX XX, $X.XX for $X.XX per $X.XX We the in and as a ago same net our loss to ended net period. fully fully per loss basic loss million or outstanding June second per $X.X or had for share was outstanding XXXX, months non-GAAP or share as or of a $X.X to fully On diluted compared $X.X and X of X-month for the share year compared million XXXX. per the million

XXXX $X.X the the loss quarter Our quarter million $X.X came of for gain to compared adjusted during million EBITDA at XXXX. second in second of

of December at $X.X our compared and of Operating ended principle million cash flow to million. million with stands in XX, currently balance we $XX quarter came balance $XX.X the as for XXXX, on the debt financing first million The cash $XX.X a XXXX. at remaining half

repaid portion last through a on If XXXX. the $X.X and acquisition, of October's company $XX Medicx you took debt Health recall, million second quarter to million $XX.X financing of help million of the cash of fund the principal

well We to funded our continue against we are goals. execute operational believe to

in top manufacturers XX second of companies Average Now for $XXX,XXX, we pharmaceutical in the the in top let's revenue we XXXX. topping for XXX%, with and came $XXX,XXX all revenue million, XXXX. showing turn posted world. QX of pharma to from Meanwhile, up XXXX. now at is work largest QX XX per retention revenue quarter improvement in our FTE at $X.X Net rate at KPIs stands XX% with

external in improvement return space. Will. will by our leader challenges and encouraged are profitability back and market past as that, We the call with the over now we in turn I a move as Will? growth our to KPIs And to continuing

turn you. Hey, don't Q&A. Thank operator, we why to

we'll wait, from first take William Daniels from our [Operator question while Instructions] Ryan And we Blair.

maybe on one, postponed. client large was First that

didn't this that? anything your this caused of And quarter was You this that in customers or past with assume the it medical of #X, say can end legal that about other the stuck will the And by there but to least what's I in that's see conviction directly, the relative third unique client review, recognition. you level at definitely that revenue start so up some #X.

arms it's their of conviction so complete language obviously, just it question. that inside how marketing start is much machine The just and It's will pharma is. scaling as Good process And the review And large Yes, DAAP distinction review. against around QX. very solution. telling it that here learning we gets is thanks. not legal Ryan, new. have around

to We always needs but reviewed, excited largest faster. team be really well. just Obviously, do. conviction, And longest high it's very just very meaningful. lasting gets our happen standing But we client, And our it's it with -- we which -- gone the to that wanted about.

if what helpful the that. for about few maybe think with versus regards That's you're in Any HCP very appetite Okay. then seeing color. we a pipeline, questions to And to sales change related DTC.

the kind and kind have more I'm the #X, [ really of marketing. X integrated the model XX-XX bundles market last interest brought if seeing with of think was you're in quarter. digital first offerings traditional DAAP point-of-care you've then also as I pipeline deal to curious And ] for integrated

that want do to grab Steve, one? Yes. you

for Ryan, to. questions. happy the Yes,

that HCP coming to that's with We on third drive in think the DTC our DTC marketing the see was where to continue participated the ways of client, We pipeline X goal innovative and we're opportunities top really to event platform HCP efficiency. for bid And now of platform, excited to connect both in connected about. the I a activity. innovation and just something goal in requests

you done the DAAP. with were know, as had we've couple won in we with what And that last we

demand that efficiencies around very, So pharma clear. bringing together. creating those very the go think the see forward. market level pipeline, that in the X their to And we And I think, is same wrapped of really see I excited activity very has from reflected head

like that we I so to it think, they all we'll what know have through and on together what rather more look is go of don't might speak. and scale back at waiting sort time execution next report we we're as yet,

comments, HCP from first closed heard cross-sell Will's the prepared you But DTC we've via as DAAP. already

now in the goes they'll And the pharma seen last they'll the well, business. with do that So it scale and it. as see with that my career, of years we've in over seen across how XX what and If and board performs. test consistent we've works everything that's we're it together to something,

the integration I cross-sell Okay. Medicx, we how indicated X us opportunity potential to can XX% the it with And Can an so the X there? or trended view a given on know and of then overlap regards what you about just is update give ago, maybe quarters the you upsell asset overlap was sales. your in that's

anniversary. there's really Relative of second great the say cooperation we've messaged, good brands among half. a really coming would be to it Yes, a movement we're up, I'd it lot even been hope you we've in closing October takes X-year to the there. Everyone of because team. year, takes that as tells just we month. And though trigger you the expect seen a the

the groups got the that groups, all the good training so We've we'll represent are can't resources team, job seen as they make to XX%. signs and as that do quantify able with skills but curiosity be sure I different positive client, do. not -- a that done today, of and to they've working we've which meetings the QX, sort come the and are a I everything would the we to say group, a feel as relative to from drives

still Got know I'll again, short just and given the strong momentum it. congrats fell issue, All performance the it's on it timing say seeing. the that but And you're right. I given timing,

Ryan. Thanks,

B. next, go to Bauser Kyle And with Securities. Riley we'll

Great.

perspective Can you've So did in $XX generate maybe in you example, understand you to to much XX% guidance, last kind for another Get. maybe in sales your in million help just, how relation trying the of visibility incremental put Will, I this think got conviction that mentioned prepared in year, time way, with full that about year revenues remarks you or Go here. just

Yes.

between actually The little But was up otherwise XX% faster wouldn't because it. bit we're than strong year this conviction, we of turn we XX% last at anomaly So a point. an saw business thought. and generally, say

right? last And year, feel good also, challenges -- bought some expect we've to messaging about company we the inside new the some So timing. fine you're the we of are. where a scaling team, we on done I around the and And business, training. a second them just it's solution When of this there's start growth like nice the a tuning in half show always to based always

not So to good tremendously good I it. about we paint are, strong picture, wrong atypical better. the where not Either don't conviction, feel of but want

Got more it. X that. questions. maybe Appreciate That's And helpful. then

First, of on the seasonality. kind doing year. of I we're the back for half XX% track know in sales total about of

analytics paying color of then or referrals, projects of separately, QX that's you on by been executives reporting to kind of about And et winning you Can and can provide any about and talk here teams. and So you've QX, talked cetera? engage analysis follow-on seasonality? kind the data either streamlining kind improvements with off how

Sure.

to then can the relative and maybe with to me seasonality Let first one start the Andy numbers. talk that second

of is insights data additional because and point on year in they at adopted to want when -- is the focused we care. we've really point hard that over and doing automating very can to they the they and get do is what this that the reporting space point. And and fully terrific. how decisions get, so really what That's that, we're On their it's fine-tuning every make insights which last data industry worked and they

sooner, else -- realized that set lot process, a early start no to and has we and relative DAAP 'XX insights. If have team, data inside years realized data the invested insights. something we be one about interesting and getting season we'll value on management, the unique getting we focused in we talk as actually we're and combined it not And to on is great, that. gets stack probably our as days. to is some bring Right those DTC proprietary prop now, that would a incremental of that you In we're that team of and to happens when scale, to X RFP data. That really doing reporting XX grow but really counting those are clients skill done, together

Andy, you want talk seasonality? to

Yes. Yes.

as of remainder XX% quarter. the would in the As at far our year into goes, XX% roughly third revenue fall be max, The full fourth. seasonality

cadence general few yes, So last the it's pretty the much over years.

go with we'll Lake Street Next, Capital. Max to Michaelis

top do creep you're you the change, top the you seen If size XX look size the on deals your I we're companies? at quarter, up, guess DAAP million the up mentioned your customer million to with of mean the level this so looking going $X.X $X of I top of that the $X.X DAAP forward, we forward in expect guess, of at that, seen Have you remaining deals in have you X, going DAAP deal I average the material spending pharmaceutical then pipeline, a that forward pipeline? I at million. creep if the and guess, going XX average And

So interesting. yes, it's

There's just with proportional were of the the clients, early right? some DAAP more adopters. tenure adoption and to they is trust, think our size I more

fall those X. in So clearly the top would -- and

answers why seeing So both. that's we We're it out. of it and -- called kind

And and top We're the to difference big is the other business. seeing a straightforward. bigger job do quite top a average our between same Get our thing, X much we're the and pretty XX XX.

the color other our on Steve, So -- and going? It's when mission. process relative to we about DAAP-related that XXX-plus it's you that any the is very put to converting straightforward. brands talk how want to

was would deals. for one $X that just it single the I deal, was DAAP Yes. add million not several

think that was or be continues Max, questions same would client, consistent that either other same I of supporting ticking asked. to the then you up is that the And and one the is say assets with inline. So I ACV thing multiple

we're very in you're positivity we're We need the just acceleration it's speak, and what of And as about of linear because of the questions. to So but progress acceleration I interest. an to of terms be pretty consistent that said, so -- seeing do. hearing that's good our it's voice what And we but in know seeing the We interest. clear. need it, to Will think

Davis Stephanie to Barclays. go next with We'll Instructions] [Operator

was on on trended into [indiscernible] how expectations. base tackle Anne there of about think for Stephanie. and talk if Medicx the customer cross-sales sales more more that have is if we the more a little your could investments as headcount This I wondering block or these versus And you are forward to adequate and you prospects of your if all part just strategy?

And to Steve, you grab do that one? want

question. the for Thanks to. happy Yes,

teams the are we I from and additional competitors between sales staffed right far think teamwork in integration the sort reflected that as what clients. top-performing which think we've Medicx that in had are approaching good several of numbers now seen We is space. are I hired key folks, businesses the are definitely as that fully

we behalf working on good So feel really is talent that board and of on the the business. about

we I those the et fruits point, is second half. making the it in half I about bare think start think just staff were this trained, see sure of At in people spent cetera, board, appropriately that really and that on focusing we we'll the year first investing getting of to the

And is strong the very second business so confidence in half. performing our in Medicx well the

little to I we In where it's first performance, half terms think maybe expected behind. of it bit be, a about

be As easy It's something. in think of we never first as Will best success spite want acquire as microwave said, our really it's all efforts. a when we going we to

it, it. So we got continue chop and We've continue to we'll wood. great the leadership to work on on

just follow-up. as a Got it. quick That's then super helpful. And

given the last still any this about in macro volatility of Or you is if like So stabilizing. the share? curious, macro talked intact? sort have trend like forecast just And market, quarter, recent you to updated the

is a FDA digital reach to remarks, are ago that scalable Pharma effective. funds prepared and focused the on largely we allocating headwinds had very just it, is that pullback. it's in said not we measuring year The make suring gone. than and seeing more a cranking. Nothing we're

Certainly, We have media that all a don't only squeeze election you could our largely business. up, impacting that if think we coming -- won't around pharma spending. time, we were an but I see sometimes that affect there's argue

speakers I'd to our And call any turn like for remarks. to back the closing

Terrific. Thank you, thanks, operator, us and joining today. everyone, for

a While and place timing than DAAP platform a and with address built needed issue during this we're positive our client us second to much ago, with team, buying motivates a team. that we've that's We're the momentum we in evolving to impactful more largest as be the stronger the what quarter excited year a market. as

with collaboration reach health is market, Our AI-generated proprietary sets and professionals fueled manufacturers decade point-of-care to in marketing. the models, pharma care innovative of patients and by meaningful data our a

hard Today, into market challenges. the AI-enabled helps and agile, such proudly issues strategies. components advantage us awareness, address effectively commercialization tackle patients. strategies overcome comprehensive -- crucial offer integrate sorry, recruitment that a These of many various we This as defined education, and profound solution offer, the affordability brand powerful

our These to daily care are and challenges health clients, the solution. in environment, for patients be and of current face part that doctors thrilled we're

doctors of to forward culture. earnings supporting and behind events quality and We on is patients with look driving and our to connecting care call. aligning upcoming next and investor a dedication our force team our in Our the everyone

your in We will OptimizeRx annual range. current our on any the Thank if guidance belief to you there's for our outlook changes provide updates Operator? team. time you. and Thank

Thank you, sir.

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release Before running to we company's end today's at for to instructions Thank year. like evening starting the Please today's you This today. press everyone that us available this remind only conference, for replay later joining today's I this www.optimizerx.com. would concludes website via conference. available be replay webcast through via for call will for refer a

may You lines. your disconnect