Outset Medical (OM) 13 Feb 232022 Q4 Earnings call transcript

Good day! And thank you for standing by. Welcome to the Outset Medical Q4, 2022 Earnings Conference Call. At this time all participants are in a listen-only mode. After the speakers' presentation, there will be a question-and-answer session. [Operator Instructions]. today's being that advised be conference recorded. is Please

hand over Relations. to would go now Mazzola, conference to like Investor I Jim the Head ahead. Please of

to full Thank fourth everyone. good you Welcome and quarter XXXX year and earnings call. afternoon, our

Trigg, are and Chief me Officer. Chief Ahmed, and Leslie with Executive Chair Here Financial today Officer; Nabeel

call the financial our host provide update an discuss question-and-answer results, outlook, a and and quarter During fourth will session. on we and XXXX our operational

the release which recorded We www.outsetmedical.com. market filed on and close issued the after investor of of is and and X-K all the news in archived can Investors our updated being a be This call of today of an section website. found will investor presentation, pages be our

current intent call and actual all and during based assumptions, estimates These future various on events Private that under or the statements anticipated made statements predictions will results that or events, Litigation uncertainties expectations protected of from or our Reform to of materially today's Securities implied. forward-looking relate It Act our XXXX. are those and be differ is risks could material involve cause to

no statements. these Outset to obligation assumes update

of quarterly business, reports. and filings Risk and the and associated with Securities uncertainties and our the with For list section of a our including please annual latest description the to public refer risks Factors Outset's Exchange Commission,

let that, to turn the with me over And call Leslie.

off for important thank us. the with and Jim. very you quarter, performance joining fourth Outset. year Good an everyone afternoon, capped Thanks, in our We're for which pleased

to exceptional labor million surpassed a in care in increased lower hospitals XXXX health cost Tablo environment. homes, deliver of care continue helped and significantly Consoles we During providers treatments one the number challenging and

our strengthening balance innovating strengthened for fundamentally and advantages, technological extending and adding also sheet. our key talent by Tablo's growth We platform

our we remain plans non-GAAP home year sales in with a result, both of a markets. meaningfully end And growth to good and toward to visibility continue entered expand growing our we gross the also of next XX%. have footprint with committed further top across in this our to addition milestone line, to conviction year margins lot As acute Tablo's the expanding

level, Beginning home providers. single for economic exceptional In with patient Tablo growing technology opportunity clinical demand the a by market largest for XXXX retention, high a increasingly review as Outset. represents recognized an for positive we performance: fueled home the and patients At Hemodialysis our saw of outcomes, and experiences and for programs, benefits enabling

to fourth overall base our home. year-over-year quarter While consoles, X,XXX markets a strong particularly XX% installed performance our year-end contributed increased approximately to for across those year

Exiting XXX the a home of base original our XX% than of to care year, at consoles installed percentage as of mid-teens total of with goal revenue a more we home revenue. providers our roughly of doubling total XXXX sales to ahead achieved

market, growth we In addition systems This initiating entering quarters, continued several with the an we dialysis believe health were new providers Tablo's both in segment we've XXXX. vector is mid-sized home for successful continue of the emerging programs be to with growth discussed specialty in home an space. providers, also to adjacent important will and which

with As Tablo in offering and to location dialysis, program we a a define programs home the exit were as reminder, place. we for home year pleased XXX a roughly such

sent have Historically, five one programs between home of XX% and patients home.

historical numbers than reaching redemption home now We growth forward are higher in Tablo. home higher low sending double-digit patients numbers second, per believe see rates. profitable we first, starting of While multiple are home home historical the sustained to keys on early, maintaining patient moving program; programs to and than

new majority It's expand home of our successful the for acute been strategy land mid-sized similar the us employing are market, as we land market. operators XXXX, the and in has programs initiate a home and largest it end IDMs. had on with in the to in goal national the progress dialysis We XXXX In to further patients we've the at and number XXXX of made from a of dialyzing top expand planned the who the Tablo. will to home which provide programs believe foundation two land in

greatly In contributes success separate protected expansion we a for behind it dialysis both Central other of success, along our in and and technology support we advantage, that is people the highly words, to and itself. the home the to competitive consistently believe product. creates to the is the We've time art the a how differentiated learned Tablo's tied patients with product home of patient experience. the our experience positive over patients

switched were that were simplicity To virtual a and its patient to view flexibility. we two educational included home into experience panel caregiver with one dialyzing that and through webinar a firsthand patients previous provide to home currently an for device end, able of Those hemo Tablo and in early patients incumbent of Tablo at the home December the patients. the of users

about to longer getting more talked They having of and end longer to treatment. patients better, those importantly, hours store said back no were mountains spend boxes less back of preparing and space no master to having on day dialysis And getting stress they Tablo. from advance from quickly felt felt able time in

the home the learning rate range are roughly we to in XX just the half training Tablo's been These drivers and controllable to in able average the on data. simplicity, four of which versus on device. device. see patient of believe days weeks has is their our XX% retention consistently Tablo master rates why Tablo’s curve continues in key Patients historical for incumbent six experiences incumbent one hemo to We underscore be the attrition

home advantage rate back demonstrated at patients rate It retention to Tablo. the number to than to on patients substantially retention our in hemodialysis markedly our XX-day half higher as which shows of we rates this choosing our is less the transition of see device. rate, incumbent We is in-center the maintain even goal of grow the

stable marked including and sequential acute several growth, to the end year. Turning environment of results revenue fourth was in also quarter course each weeks first strong this Broadly, of we over growth QX. macro acute quarter QX fourth through through the quarter largely now our the the from by the care the saw market,

staffing capital do on meaningful Tablo's will expect a close which persist not watch can a affect given value to-date through spending, proven proposition. hospital keeping and affect timing and us deals, also XXXX, providers has strong to headwinds we're be We but headwind for the of

of providers in decrease some did hospital third-party their during further the see contracts levels cancel prices, to quarter customers. and service service with continuing We increase dialysis evidence cases,

to as permanent needed The move in customers with bedside is its them ICU of providing dialysis staffing of towards Tablo, bridge while fully Tablo designed staff. nurses own program. both patient the by our the our hiring on inpatient dialysis in-sourcing, As who prepared the completes process treatment, a program short-term deliver and floor, temporary we as the remain support solution

a continue XXXX, important hospitals savings who we for recognize challenging are to eager to serve program providers the and as bridge initiatives. environment forward stop to move an staffing manage expect As staffing gap in continue with in-sourcing to cost

is than capabilities a accessory drinking worse TabloCart, around in innovation hospital full incremental maneuverability that for quarter our pre-filtration with sites provides new that the quality first From quarter standards. was water national far the water perspective, additional a market and with product last

positive gross accretive pleased and been launch from in As margin QX, with ASP. Since a we've its reminder, customers. at TabloCart strong separately a is demand reaction the sold

Throughout so approach. which team strategy land the to disciplined, expand XXXX worked and our our very continued last in commercial years, execution the for that determined is their same us has well two

and our transition in lines penetrated console digit double and to acute low Tablo. dialysis are their beginning service larger see We hospitals base as to expand today orders

During closed those in recent XXXX expanding remain nearly or acute XX multiple large consoles. With quarter, more on the networks. new beyond our the for customers deals the provider focus a and who will Midwest consoles quarter involving purchase landed XX within we of ordered including

I'd turning briefly highlight call to Before updates. over Nabeel, operational a few to the like

we model important a strategy and This cartridges improve production step Tablo long-term First, our an by the expansion outset to flexibility also in of at of secures significant manufacturing our component forward Mexico of move continues in-house initiating operations. facility. our business took our margin

room, Mexico. us existing within three began recently digital we capacity Tablo Class fully now leverages has our which from of team state-of-the-art and this We future. the have in room and qualified well A our into to carry the clean clean built infrastructure, our production The move, facility manufacturing suppliers a cartridge. designed With treatment

our thank critical the readiness from across exceptional I to It's congratulate build ensure organization. we example this operations want clean another our and another expand facility, the our team drive achievement the to initiate for to type continue high-performing and significant innovation room this team of Outset. of work forward step to and the for

business, account and without the as Second, sequential we organization, quarter. during are about gaining leverage made we example, operating penetration our need we In progress reps. scale in sales improvements talked excellent productivity, additional increasing for for we gaining the the

we operating from in also made our Importantly, service we've are organization. the getting investments leverage

been historically Tablo. change a capital has equipment, thought very process to with something manual we Service for

data a Tablo system users our enables basis. during see to analytics and on software with proprietary real-time permission, platform team Our access service a remotely treatment the assist and

installed our XX%. by increased we base time, same the At

providers. rate wireless this resolution improve our serve the efficiency, the burden improved full of dramatically capabilities. does two-way advantage for XXX%, and experience reduces improves cost Not taking approach also by We our only our lowering support our remote it to communication customer and Tablo's

announced Vazquez a will that Martin after XX-year today retire we in Outset Finally, career tech. med from

will company. manufacturing, Outset benefit Martin's and and that been truly we leaders, he really expertise the as all a building from of world-class of R&D I continue his of mentoring fortunate logistics want team weight. supply legacy have We established whom incredible extremely consult to and above to with we're punching recognize Martin’s keep capabilities contribution pleased its and to chain,

and more XXXX ever beyond. in Taken made opportunity updates the and us throughout leave together, the about year optimistic these feeling our progress than

and a in families. very growing of operational we their segments are highly a another a healthcare of And impact aside financial differentiated We our patients base the and to model. deliver well customers product, goals, recurring with aspire year for and from largest of revenue deep positioned compelling of one

patients as of patients on been status have leaders technicians, and and served Dialysis focused have nephrologists is deserve Outset who and nurses, community fully great, quo. long dialysis I our hospital team, experience the just agents to and that but embraced as to mission well overlooked ever-expanding enough, they too the change and thank change good entire want for

and to our financials I'll provide detail that, to now turn over the review results XXXX. With more on call Nabeel for our key drivers and

be to and year-over-year Hello uptick is key change our expansion. higher quarter revenue of consumables and and recurring driven one by XX.X% $XX of one to with primarily This Leslie. service revenue approximately XX.X% revenue expanded Thanks in million sequentially of benefits gross and base of everyone! other continues increased installed Our margin drivers higher the a four year-over-year revenue. the

Product $XX.X demand revenue quarter by accessory XX.X% XT the by in from increased saw and the from ASPs year-over-year the for $XX.X to XX.X% XX.X% launched console primarily of TabloCart, ongoing driven and We to XXXX. million. year-over-year, was Console fourth quarter X.X% increase up million. year-over-year grew our prior the and Tablo demand again increased by third new quarter revenue

was deployed we up Consumable in-line cloud XX.X% see base and expectations. the continuing Based our with utilization prior data cartridge of network, increase be from to $X our XX.X% our grows. installed as to million, versus consoles an on revenue year from prior the QX and connected quarter

year. XX.X% million revenue compared the by Service $X.X was from X.X% and down prior higher of quarter prior to the other and

core Our the of was planned and year-over-year offset other HHS of XX our approximately by the growth with revenue base, service installed and increased XX% agreements. the

As third saw quarter a final of of components the XX the our XXXX of agreements. HHS the reminder,

our non-GAAP today's the expenses, highlight margin will gross to GAAP you release. review measures, operating which be and I earnings of found Moving non-GAAP to to can I encourage results. reconciliation in

milestone X a consistent expansion, of demonstrates year margin. the margin once of XX.X%, consecutive This five and commitment quarter improvement our and an prior to basis again gross quarters points percentage [ph] fourth just was margin XX% points progress of substantial versus period. of our next Our gross over gross sequential and seven improvement marks

cartridge ongoing start program, down freight our cost manufacturer anticipate contract manufactured The cartridges has higher has internally reach revenue primary as costs production that margin We drivers cartridge been our of console margin XXXX. customers will our and over of taken to our in expansion the our mix. lower Mexico-based majority

incentive loss $X.XX loss of fully per in for fourth $XX.X spending. quarter year some of $X.X fourth quarter a million year per We $XX.X share the net prior down net the $XX of in share the of of compensation period to to period. reported million, expenses prior million, net GAAP compared the $X.XX and million loss we resulting Operating benefit a or trued-up manage versus year the were our for as efforts realize

or the non-GAAP million includes We term was loss cash in net the equivalents, per $XX.X $X.XX Non-GAAP $X.XX same under loss of cash cash, $XX.X per a restricted which or $XXX.X to XXXX. period approximately quarter of with compared million loan. net million share ended drawings $XXX million share for our and investments, of

up our debt access of SLR to continue an $XXX capital We have million under to to facilities. additional

now Moving $XXX XXXX outlook, to million over 'XX represents revenue. We revenue growth XX% which full full to XXXX XX% range year million, year to starting for revenue. approximately our the with to from project $XXX year fiscal

at grow will faster revenue and our Our that guidance grow our revenue than from assumes that rate revenue end end home acute. and will markets from home both a market acute

XT a market. our assuming units the acute ship into translate will the This features, now ASP. we of higher of strength is the majority we're that end slightly a in XT into Given

XXXX treatments in of per our of week largely four lower on guidance to setting In how we're home seeing average and to week per to the ramp acute treatments utilization setting productivity. our to terms due our end consumables, full the average, on four for at the in customers' three the six contemplates

there Now, then Based QX pipeline in and seeing revenue move or models. QX, expect we to be from more the you on rest slightly accelerate will flat we're QX to from to growth will and sequentially through of some as what QX our capital typical from we year. your the trends, down purchasing that give detail

our guidance ASP, the and of as margin to our console full of gross from our XXXX, place Mexico. as With to for year continue our primary to move down well cost respect of we to margin on to expect gross impact benefit the manufacturer ongoing the higher treatments activities

for gross expansion approximately non-GAAP We to have to line full of margin of sight year XX% the XXXX.

expect to non-GAAP flat then gross with profile, we and Given range non-GAAP in gross QX, QX compared our margin we that in QX 'XX such XXXX sequentially expected revenue to be margin for relatively expand mid-XX% the 'XX. exit

sell. the our from based consoles As gross period-to-period fluctuate may margin we and of acute reminder, home mix a on

Now, like I'd turn to to non-GAAP OpEx.

home to to business to revenue progress and in of see our market, we date, in gross to market intent focused large continue invest R&D to front differentiation. Given opportunity our ongoing strong the to continue expansion tailwinds and us, is we the in growth, continue to long-term extend see our margin Tablo's the drive

revenue as we slower growth and Having said that that, investments we than rate expect to infrastructure forecast start in demonstrating to and bear in expected, of in XXXX 'XX increase significantly low expenses to in relative XXXX to XXXX operating the We with double-digit our operating made leverage start expected growth. people fruit. XXXX

make a And our like to finally, few I'd balance sheet. about comments strong

and our operated XXXX, strategies XXXX. XXXX into about We environment carrying during one have the chain of supply tough as we talked of previously to large in amounts inventory mitigate

have stability, As thoughtful terms chain, expect in able inventory improvement macro in we and In we the burn we XXXX. combination with than we expansion in expected operating in what XXXX less gross 'XX. our relative increased revenue to increase, did to XXXX supply look relative managing inventory be we'll not forward our levels reduce be levels margin if our to leverage and environment around of and to expect XXXX, see to in cash increasing exiting

degree execute we that dialysis, our we a demonstrated and continue large providers. Tablo's the In year our us in finish our end markets. value And that a summary, patients to in gives have ability on home to acute XXXX as through deliver momentum to had great in of strong and promise we confidence to 'XX high proposition

With open for we Operator, ready are lines. Q&A. that, think I the please

you. question America. Thank One our of of moment Instructions]. [Operator the proceed. first from And Travis line for Steed please. it Bank comes Please with

of quarter, halfway full And little afternoon. December, patients. that on on And had record Good down you January a more for is said what's context think shaping that would heard guidance record Curious Thanks the give the up shaping for QX? grow for in patients I home through to taking up we're question. curious terms guide Hey! the the faster. is QX now I you flat year, sequentially. bit maybe how in

XX% if if And home at-home. of at revenue year or so like around we for ended XXXX. are the coming Curious you high the end or revenue of percent of the mid-XXs a that’s in year lower from XX% range

got the which what I Travis, remind your Yes, the back home. the was? first of part Travis, middle Can the question. the part, is missed which its me part, hey you I the guidance Nabeel. was QX second and

I - curious for I'm the home. patients. record of December just and was guess – That was kind

kind of December? [inaudible] February January shaping of in and curious So up where in in terms

it, Yes. got Got it Travis.

for thanks So question. the

guidance know and So about, in on always is talks affect couple to look, what seeing a what starting that’s company purchasing we’re a that every off capital informed softer, you you see by starting these strong QX bit QX One, to where us our as of things. know QX, pipeline that a decisions and is is to quarter our well. we’re comes

the And of so an that’s only we’re seeing year, sort trends the through we’re of macro just around and the rest softer in with us. looking QX at that acceleration the a

for So one. the part that’s

in so at we year on roughly full pleased home were last year, Now the XX%. ‘XX, that came

part big ’XX, higher faster – full can you You off is a even of know if and we of to significantly contributing going is even home if look going so in XX% that see at grow had ‘XX at that home said that ‘XX to be revenue. revenue, in base, growing year than and grow home a even we faster

give like you in did right, terms of years number didn’t in backlog And year this past? the backlog Okay. you a

We in for and be business our of our a at backlog still think thing period. part we business. first Yes continues is the a look to guidance big when run certainly it Travis, backlog any about position, we

backlog to to been terms expected in we longer of growing of as move talked XX% XX% which What is expect faster consoles, relevant of talked shifting for which homes we is have a to give XX% given so as right and are metrics what our to we longer sort year and in our we a sort full revenue of we the it’s our shape to and deployment and acute, consoles that and are so Now has forward. we base, relevant X,XXX those installed we before, of less more looking cadence the talked fact as tenure, we’ve the of sort and growth disclose to did we than home more and about forward. less metric XXXX that’s grow think monitor that to about think

helpful. XXXX guess then bit All And a right, of a guide last the that’s margin last reset a margins. on I little on month. question There’s

want can that pathway know When about to the Just kind color you of linear you four you you – three talked provide year’s XX% any levers sure in this pathway? does margins. make to years that on think if margins, driving there’s the the change over about

where to You think well through expected, lever the going better how know a the flow pull year little revenue this comes in a and can growth XXXX? that’s little if do for on you margin you harder than

unchanged. look levers Yes, Travis, the are

right, and continues revenue growth leverage, levers service and well sort continues cost are those unchanged. to of to it So so scale pull-through be It to it consumable as be continues be down. console as

We in to again mid-XX% XXXX for exiting get continue ‘XX to year the our from roughly in and we the XX% of the year confidence full for predicted XX% zone. to that ability have

still I ask, cutting thought in path a Travis bit it linear you’re heard to of and a sorry, out kind us. is little that? I do him And for

yes, out. Yes, milestone we a path you Thank be it to and sort yes. sorry, were you. Yes, cutting Travis have, to and in next that continues XX% of linear that

questions. for great, taking right All thanks the

our Rick of next the please. ahead. It question Thank Please from line go you. One comes Weiss for Stifel. with moment

But about, get Hi acceleration what seeing. Leslie, me Travis direction accelerating exactly systems, saying that? that that take – thereafter. slowly that confident guess going a back customers Nabeel. change, let they you’re understanding, to I I’m about like setting and why I in afternoon know question in the short just home. first move you going does sure Good come little that term, want greater fourth, was more Hi! not us seem sequential the and – what, asking and are and you’re you’re after are make a are slowly Nabeel, the acute way so in that the to totally really quarter just the sequential first mean slightly quarter decide more who’s is telling are the I I they moving where I’ll just to to why exactly why they understanding to to the it And pressure. i.e., it’s slight versus committing I’m the or

could you If comments just there would be expand on great? your

Yes, you mean, said. what it’s Rick. I spot-on

and of guidance you we conversion to again in rolling terms of at looking is hearing, it’s for pipeline, our year pipeline us. our telling then accelerating of backlog a And baked customers are that’s start in. the that and when set we sort folks based and off the on exactly again, we the look what and for how beyond what Sort our slower look have we said what that’s at then period, any backlog, and are we’re

very exciting at point, entered bullish QX year. from the my any from add am in staffing of add JPMorgan. Let a macro I and our that preannounced seeing add little from worsening changed – we worsening the any I’ll position so we too. really Rick, on me of that a From There’s spending the and we vantage – really are I’ll environment. aren’t really nothing entering color I’ll XXXX QX or capital very, has have bit of or

whatsoever. home, momentum, We so concerns have me and the acute that both of the lot on nothing there’s this a in

That be I in a little sometimes capital can a seen other flat think businesses. QX bit this QX. equipment to know just I’ve you bunch

new that different there’s really just the that in or wanted So is nothing fundamentals to macro here. add I

huge on the three Yes, I’ve we I good, it to Leslie, had heard to sense you? good. obviously based the you, a maybe It customers terminator. has thought Bridge been from so you But I with. the heard am program about know, be success when spoken like we was a sounds or ago it, going little be longer. the it’s misreading months going don’t that I if

I think excellent. that’s

So where this I guess just go this does program, are, on? maybe question how sense bad? about good my the talk is, maybe you the best from it in Is I on wondered long margins about of impact permanent or program.

to yes, that. Sure I’m happy talk about

two there far, you to One about the think that I that and is about know short in the of and when or remains implementation so is then other the program aspects talked are so each and itself. questions implementation, talk duration, I term you duration each duration when of the to true two nature duration duration. speaks

bridge option for to offer XX the days. partners using of up We our

of to been the on originally is point that was making have think XX dialysis nurses weeks would well However, almost implementations few and able than I news great customer have most a I it so they to days, hire shorter feared so been take, less was the the our than side, a they faster ago.

to to as psychological it’s past, or going probably we know the it that it it’s adds part of to that – or or A the comfort us sales form the help value value. need executive we’re think in they – of expected majority I give for I than in as value of be needed. program, you them. I they said a if no they I And staffing, there if can lot part trouble gap, want duration portfolio stop be. way longer of be the pull in We to as a process that terms in In a sort of to, take our think the ability lever intend long here, to just is of have don’t for safety shape staffing but company, our a does the of our

material all. that really love about we’re at much lot it I without So it what – without think is for a value I bridge to of getting cost

more the Rick, time of you see in knowledge needed. of if portfolio customers see revealed we’ll form some that but it’s in to for the So a future know just in lot it available the I not our necessarily ‘XX, be but of implementations, part could but giving a

me. Got one last And one you. for

I think talked maybe it you in prepared and I in recent months your missed comments.

said XX were and to ‘XX. to end did had states had that? by You in you hoped be want you to states just one. you like – I be clear, something expected or year in XX be achieve Number

sales And number of now, two, your adding you size an that reps. can to correctly, the maybe penetrate force, relate can without if That aspect me. of leverage you of operating struck that back now you new because accounts I heard

new how would here? it’s think need I an sales to grow And have from Will on new point. you you not if just add because to states, the reps? need expand maybe to So that, you. force not add important Thank

color see some give to Nabeel to I’ll and sure, it yes sure, over then specifics. Oh kick

out what I’ll well, network, the there. you in we hospitals a to across have on – I that is know when large foundation their really, really side acute strong productivity, there’s formula of with they programs proliferate sales up in existing trying a point other Tablo start to force were a start customers, you as base think of sort

XX, eight, You health hospital XX, nine, don’t to a need is single every XX, etc. as invent system expanding wheel to time, the

Tablo really much our do good insource recipe efficient, more makes quite we've you that do success. how you down and because book make in a so And it team got how with terms a of

efficient, team our more an how of which therefore us just to much example do that's fewer. so And has become more with allows

sales gives We us yes across geographical the sales yes, additions you're without the across that coverage a allow is now. some making to also force Tablo us and do lot the does and of used have country, force. widely expand Rick, broad it right, test to necessarily

tied are but to expansion team will continue as to be to will the add needed, absolutely that expenses those We revenue. variable

the So in from start we scale big necessarily news, of great target. margin force, our which the advantage to of fact always perspective, about would don't we've big, see thousands from we to is size jumps an and at that employ reach operating foresee revenue to army an not talked sales the needing

continue that model go produce continue has will this leverage is to I believe already will So, operating that we one and to forward. as –

Great, thank you.

Thank our you. please. moment It Markets. Shagun Please next with line comes of One from Singh proceed. Capital RBC for question, the

U.S. for Nabeel. strategy you much know could detail; the taking you little as Thank for in you're in the so Leslie, a with home about hospitals to setting buckets, talk dialysis respond? home incumbent opportunities Great! XXXX one perhaps just thinking the more you about you bit questions; and the the partnerships Leslie the to the and with how your how maybe expanding as one clinic, different for in home maybe well

pushback know as executing And top you about question think your you home in terms there And a that about you of you on I the XXXX, expect? strategy? think mind be have strategy may major Nabeel. as any risks are the that in then Anything of for

back answer I'll you, to flip go Sure, Shagun. and and it this ahead then one Okay.

I of that guess I could there strategy. the On layers two strategy, our sort home are describe think I

members is making patients, So affecting of is patient. an most that the experience experience matters but what more members. family lot only most layer Dialysis is on up and people that the have just great family a matters not ends what than one Tablo, a sure

and retention even focus if a we're or faster. that think down accelerator these push it's as trying me, of rates, obviously that retain I super about further the worries lot premium that something there's sure And we on grow making always to our even high so

So but I to retention a in this maybe manage levels, up focused don't every rates tell is Well, we is on that these there that to risk? historic push single can so. you company doing individual

channel never-ending So want is it program home of of to access and more the so retention top that course, more that expand followed and have it. in offered to list is Make the by the at access. strategically, who patients Tablo locations effort sure more a

number where Tablo already are and home one base pretty and on be exciting nice, these is existing each patients really deepening And third, of already have growing we locations focused offered, and locations. of program the a sent from will do we really home doubling of pretty who every down, home now

our offered again want average who and early to see have home the of are for in a again programs number and I encouraged that some so sent some I'm and again and We again. Xx patients home Xx data typically the see script of program, that. it to really

created the success. scaling to we're so that that some recipe the successes be and we've And again, on of have early the early going focused books developed

sort being systems through think and when at the other and we providers. our specialty second midsized health two principal look partnerships partnerships another one talked lens, about of the with dialysis operators strategy, this I adjacent with being you channels, and

growing operators, with already dialysis we players, to relationships midsized these ambitious have grow. we several get more The room of want to because and now there's

lay midsized at and a as national operators we two goal largest our also so or helping home stand and least to claim of up of to these talk with about And with majority programs. IDNs one them be the partnerships to the

of regional home to the systems now at level. created successfully and national have health see want a good roster that we We up with expand programs that have Tablo,

from think the too elements XXXX, and working. put, I simply different it's So strategy not ’XX terribly are because certainly really from of

about work as execution down so of and get team. kind continuing And tripling now a to it's all

incrementally 'XX, and the not of in need for you well loan taking magnitude said helpful. going as really And as draw that? plans more lower on you the the And burn, to questions. you Nabeel, Thank just term that's to it, little color it's return maybe a have capital you on for you, can markets? to know to XXXX, your bit Got be then any cash provide in just

Yes, Shagun.

finally cash delivered than on So OpEx our that really flow, higher and less the capital management. we'll in you that's of over our margins, is expanded working look XXXX XXXX we year-on-year, cash, that, for expectation strength $XXX growth million and then gross revenue, lower of know and burn

So helpful hopefully, that's there.

to we may loan burn With under and We can line, think respect on year the term cost about with $XXX we not on cash the to that million cost cash of that as going of term look that to cash. we're still If million $XXX know we on. on ending optimize need just we we does draw to down line, have free. our less year-on-year, facilities, last up of sort and right, we're look growing because the not sheet draw to have that loan come balance you

So that's sort of what there. I’ll you tell

always to that end expand our capital have long that we run we sure and we business have. that And will need the then into the we markets making over run thoughtful these large look, we sure make about are

business. And for makes so our always evaluate we'll what sense

moment Suraj Please Instructions]. with And it question. you. line of Thank One our the comes go ahead. [Operator next from for Kalia Oppenheimer.

hear me Good and afternoon, Can all Nabeel. Leslie right? you

Yes.

Yes.

one one in So for you question Leslie, throw then and Nabeel. quickly for I'll Perfect!

So now the you. then So your approximately FY one curious, guide more there for and for now you, before that's hold the FY tell in but home 'XX? So was the that I'm has specifically for for expand is hemo what Leslie, and it commentary are 'XX, similarities, changed? us same

math home Nabeel, FY some And if at home wondering in patients could of average you added number if 'XX, color for us on setting? give treatments the suggests, was if I new additional you questions. shed you patients is And from novo my next lot many could crossovers how there color patients Thank commentary a on of for versus de about crossovers? some also, taking are stage, the

right. both is our grow business ’XX, so our expect our home expectation Yes, we of for our ’XX mean their and one, performance I in to respect that ’XX, sort look will acute so – to our with that Suraj, home number in relative guide

business, remember, grow than bigger off acute home said our also base, We this a that and faster right. will is

the contribution implied part both 'XX, same, for that acute growth, so looking So home we And if our unequivocally, right? and there one. 'XX, significant are remains for of in to is looking businesses business statement, still absolutely, growth that's grow in grow the in even our to home

treatment de and homes, three prescription seen always that patient, between based the just with it the we've depends average sorry, And is for transaction Suraj, home. in average the Part respect in home in know, of novo you relatively sort of ESRD all where the newly patients are patients in we to and on things two, year, diagnosed to there - physician's that four tend because treatments are patients. considered. console per every small getting numbers who be large and still come we're numbers, They

Nabeel. on Well your question Hopefully can't Suraj. said said. I that the Well that answers home. top

our Thank proceed. Please Drew of comes Morgan you. Stanley. question it the One from line Ranieri moment And please. for with next

actually and taking Nabeel. and off of you see low now I the the Hi, double patient's mean it's that's sending Maybe the that therapy? Leslie understand kind opportunity the De you piggyback Thanks but Leslie to I program I home encouraging. mainly just a how digits and guess about from question. of as eventual results for your mentioned question, of kind that last multiple burnout home, now, Novo PD of are first thinking really using the that

sense on maybe that any anything you. just kind trying two the to double Just low for thinking catalysts about 'XX? you Thank point products in further of for a relationships? And that topics. or growing are VA of better those and how Just 'XX to new to us the you even potential like can digits get

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find the exciting. found We ceiling have I not really which yet,

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equivalent the ease Tablo population. see with across really We

and yet time So grow get, it high we more task. see could I up ceiling a on don’t how further and how could

obviously marches on I get over as very, do, how time. time own that I and but to team's think am programs could forward, revealed more these as time incredibly big makes our bullish they be with efficient us very home

I'm at transition also very excited a in unbelievable the vast with that patients in flow almost who are HHC. I funnel of It's home on as very, the shown PD What find thriving in-center end PD is majority to be from criminal no what to in successful XX% into a to and and about really makes would themselves clinic. into HHD future up at to like PD already already home, that. dialysis. way do keep an people be home, transition HHD terrific the It successful opportunity home They've of PD absolutely sense. a

that educating do much, that How with that? we do will much That earlier. take partnership Well, in providers, will time. – population be

It'll time, work You with in nurses, progress. to educational which physicians, test. take with with we know it's do a training a home intend more lot

is got plus the I typically which at and option the offered off transition two-year first which PD, to evolved is happens mindset get we've around one mark. have to what think the in to patients first HHD to who PD

opportunity on I time. a growth over big So just as thoughts home. this That's for see HHD my

and is home. for now with very are and sorts value them, that I all in the operationally of seeing products land maybe in terms widen new has to the to a in very, expand 'XX the VA. compelling think for eyeing system are the opportunity we think biggest one talk I continue executives the this and our now really for one aperture delivering reasons. Tablo I health economically, I'll home acute is that that beyond of approach and really feeling pursuing opportunity and catalyst Obviously right

catalyst of So, I think that's one. kind

ambitious Catalyst two, intend we and very stay inventive. to very

next in yes, terms opportunity in know adjacent have you home with five of over interesting the with space. the think really I base, customer do far we Tablo far, done new data and not new are we XXXX, innovate will about to platform, some We we future. across a years the into and of some far, and hardware, software have platform new and hope the things the the for I with on kind VA specialty tablet the do providers talk

guidance Drew, is produce a done degree success, those think success past we'll what XXXX range XXXX with produce in year what's all leave important us again, look suspense around at have for what on in you we So I but in high of that. entering very will in conviction as the things, we of is our to most doing the and

next One question you. Cowen. Please please. the moment with Jennings from for line Joshua our Thank it of proceed. And comes

for Thank Hi! you This for Brian taking Josh. my is here question.

either this there or pricing on for an as your see the believe well in in in primarily increases Just raised or outset you do TabloCart? competitors from to recent of segment, have year attempted environment XT the to opportunity ASP coming continued Is I that prices you pricing increase current commented months. the acute raise rollout and

can Hey Brian! pricing Look, we imagine. you don’t as comment matter on

say what sort absolutely driver is in a also ASP TabloCart instead I’ll here ASP a or of are with be seen the Number a big We’ve the the of value, there. have which seen we think couple XT of pleased quarter like. be we performance driver attach, really of customers rather and one, which increases value I our is monetizing things. that again from to adding

proposition. also we know very a that talked in thing, to value past, which view discount economic the lot fact we haven’t one our we to heavily the testament again, You as had have about a Tablo’s

have no for is about favorable, favorable we pricing, and pricing was So us. complaints pricing

not thoughts. I'm pass any Thank the back queue. showing to I it will Trigg final Leslie in further And you. for questions

Great! a today. operator, of you Thank Have for all you, us evening! and great thanks to joining

concludes And disconnect. you we with that you ladies for gentlemen, and and program. participating Thank may today's now