Progyny (PGNY) 27 Feb 242023 Q4 Earnings call transcript

Good day, ladies and gentlemen, and welcome to the Progyny Inc. Fourth Quarter 2023 Earnings Call. [Operator Instructions]. It is now my pleasure to turn the floor over to your host, James Hart. The floor is yours.

good and John, you, afternoon, everyone. Thank our to fourth quarter call. conference Welcome today With and CEO of Mark Pete Progyny; Anevski, CFO. me are Michael Livingston, Sturmer, President;

We we remarks your some will call questions. the for before begin with open prepared

including mix, the and first forward-looking our our we to new and and strategy, to operations and assumptions our position, and comments retain for due are our and/or drivers views number the of financial your guidance, XXXX, that will sales and the forward-looking of management's clients other responses today reflect as outlook market our underlying clients, begin, concerning factors. federal these the as may to results business and existing only financial uncertainties by potential implied our those of law. Actual operating for statements materially of well and season impact such I'll quarter acquire client expectations securities expected XXXX today our from include risks utilization our and market clients our and solution, information with differ our and Before upsell contained and and year which important associated and business launches lives you as opportunity our other benefits and rates remind future under full questions covered and to statements statements both related the plans, goals ability anticipated

release, filings Investor risks, results, press to both on refer be factors Relations could actual are events. statements, that information these as the that today's update or please new which we our on For this obligation future statements important on we and website. Any forward-looking assumptions excuse can undertake a a as SEC impact our of me, no information result discussion uncertainties, call -- of today, based make assumptions of material other and found of to our and

comparable we adjusted incremental will information call, margin, financial such non-GAAP per as margin the on these investors.progyny.com. turn non-GAAP and reconciliations about the at now financial also diluted More measures, measures like revenue measures I available press the are call earnings in EBITDA would which release, adjusted EBITDA GAAP During over to EBITDA, non-GAAP is to with available the to refer Pete. adjusted including most share.

operating levels nearly this Thank exceptional adjusted was us XX%, year twice XX.X% Thanks, $XXX in for generating Progyny. which with and delivered grew year joining afternoon. or A record XXXX. flow you, another more we million Jamie. of everyone, profitability for cash which we XXXX than revenue margin EBITDA achieved in what

building and the As also journeys once new extending realize deepened while with member our in industry-leading a important also base and them, clinical of through eighth straight number urologists what continue And through are, in costs. RUs male satisfaction, and network those both of menopause in outcomes the year dreams infertility. Aided address the a operationally. we while to largest providers REIs the clinical by addition for BaaS few healthier of the I'll their collaborate of our success our yielded with network more near on retention already reach Driven in season of again that remarkable pleased now selling our of measures equally that to the largest achieve levels we financial solution maintained members helped highly relationships of of our concluding faster while reach we're in which history. in We covered history, ways touch and just care. highest-quality X,XXX fertility achieved expanded with quality reaching reproductive XXXX, by highlights. with the the number Progyny the client collaborative family country. of the than we lives and network our our controlling the we've these the and we we our XXX% as And treatment client across of

launching otherwise an fact, cumulatively we've helped people stressful health successfully since we've of care. thousands our treatment overwhelming let a for in scores of solution been navigate achievement any what in NPS have hundreds routinely alone while of course and the XXXX, In so done industry, complex, and would XXs, achieving exceptional

meet conceive of state for committed the these to results in successfully ensuring put their on perhaps helpful over after proudest company, to news through tens are in born we're just cycles As evidence-based when unable aren't own their of care. access today barrier numbers to carry remind lives week do but solutions, focused all we Progyny to our their to with to in that a access ourselves empowering have those understand to been the people particularly life-changing is including successes, where tangible how of sustained our on support live. on a mission-driven having about everything to the potential term. turned It's every outcomes past need, of we where those success day. To because to we're there to babies thousands regardless world milestones of a in or And were parents IVF fully a the who of of for members for respect people after typically page, it simply, unable Alabama the they child will clinical continue

fertility the people the their to action care will access while greater decision, X need following someone and many building as for realize of ago, millions has know to isn't surprising the availability life who've affirming future. It's is encouraging, of to their this already in years us a it the indicated order including people family Just even governors, are of saw dreams. ] the these an to services in likely it number ensure some of services. to to Alabama's, have successfully to these and how legislatures who given individuals state And used number of it turn reality it DOB personally legislators needed that to continued [ we these intent take

macro previously, trends As is just ago X driving prevalence has said of to in of the increasing infertility, one demand for to a which X X in the handful according today we X the care years gone from the of CDC.

in the You've fourth guidance that XXXX. seen the that in you we is had the more reflected slightly the and period of midpoint ended the why member was up And what anticipated, was we've cleaning pattern XXXX. for typical closures to engagement closer holidays utilization our although up clinic all decline the maintenance, than revenue reported due member our year, which we've strong reflected in routine and in Continuing metrics seen in in a versus to actual activity range. QX decline the comparable to QX quarter December that

the expect the quarter, normally estimate treatment $XX there we've headwind for year, approximately mix reflected at in which with expect and which start XXXX existing benefit As that resulted the to line the in last was we the see we new revenue in levels would of million are quarter guidance being a consistent with members. an overall to this is the would utilization in in at shift And year, on began, more early we year, used brief first in utilization what are quarter. what levels and our while from in that returned the demonstrating point both by as

to the seen phenomenon to has once has into been in and now it's return to this summer company, While of it short-lived happened, of previous distribution, to more we've than that To March aberration customary short-lasting of that that since was visibility mix indicates ones, the often the a trending like levels we've treatment typical activity been in February happen doesn't expected have back more normal already and us all thereafter with reverted when us. January second distribution we the treatments. over and occurred behind always giving has the end, and public half confidence quarter, XXXX, only it's typical this closer

need in will a balance our walk reflects have which families QX likely that priority. trends for reflected we're is more our full fertility as the Mark by affected guidance quarter, the continuation expecting we year trajectory is People what people fertility medical higher the the of consistent growth, activity over historical and need guidance. doing family to in building number in are are increasing been our their of a through be are seeing of much will the more trajectory later namely, so, macro the you benefits that infertility now, wait condition. with for That care to first an year While until than the fueling and is in given start still to ever a and with continuing life

number a of ] longer-term In continue expect macro fact, [ that create will success. contour factors to these tailwinds we

family particularly benefits demand is the years. are the among millennials of ever, First, who fertility their in building for than stronger prime

efforts, Second, family doing only to been building also meaningfully support they're they in particularly employees' retention their needs. benefits workforce with modernize they're as they're health look the recruitment improving to increasingly so, have employers, their Employers more that relevant coverage order or enhancing women's better and more and of never providing realize in productivity. timely the not efficiency

include any to its other seeing to such by by from commentary, with enter soon to coverage even adoption and selling evidence-based positions in Third, too while access stage. experience including and by comprehensive benefit services, demonstrate early patient expanding and very providers. don't for provide XXXX for already and it's and other outcomes itself services. XXXX employers pathways raising success when preconception, us of their lastly, early strengths is proven doing menopause. And we activity employers adding greater and care by are market as by to and thus parenting in pathways, we're positive. to what support, programs Progyny the should bar the family ideally coverage as continuing they this commitment far building care, that continues offer scope or our in as services by more management it their to health This expect differentiate such measurement, a broadening the surrogacy to the into network quantitative season their very they're And women's is education leveraging successfully their set have

sustained last largest point year, this a has short by additional first which expand generation relationships, with been early our market Because consists channel our our our RFPs highlight this the they're XXXX the rapid care penetrating advantage which number gaps of In we will short, few. and with were our introductions productive selling entered heels of expanded expand a labor comes to efficiency. consultants, of which adding it of other time clients address growth and often particularly addressable other the time, share media, across most delivering have And pipeline, from own ever then cost care, of and X benefit areas over opportunities targeted considerable in as a over we've opportunities, just at adding populations, us early either covered percent services, despite to that period all created to carried proven real our in also we government access, year. market are apparel, member to federal conferences, very last even of of is other to opportunities at health including such of in in further wins, on our opportunities well-known family of our active employers. lives. Though patient clients and proactively season, history. participation momentum, the the our demand sizable through looking early building activity. We've the respect stage of continue by or and brands had will the TAM pipeline facilitated key of mid-single-digit we've our seasons, health years at a be Our were a of we partner the with at a as that And recent the history enjoy primarily types just activities, with experience value

can for we journey. organization, is seeing and why return workforce. These pregnancy we new That's to the eventual included think look ability new they deliver our enable address support and to product family negatively our plan for adjust a navigate Postpartum provider further uniquely life's mothers selling areas other the areas XXXX given preconception team being expand support, areas well as new the such companies it's member because further so both contribution the parents help their where is the partnering the expand that our is our clients And to known gives in position milestones. We've us letdown selling to trends our as us solutions the industry-leading and or well positioned has family caliber the sense high the These we that of become conclusion, as our investments expand return or both once their the Progyny amongst in the Progyny support and fact, we're is to to existing continue most leader or to ways season space, the in beginning has pipeline, clients. member active as into demand quickly choice to driving even addition in services sustain existing and had to like other companies their macro so for best And In are early and special, about for to amongst made in the that other with XXXX, key for unique maternity of season tell PCOS activity to the we've trajectory. in can in so help concluded us combined new clients add in as support. for XXXX. impact world. position evident us upsell services endometriosis, that us activity make clients health journey we'll about confidence the some solution for already growth with the features that benefits platform more and our building fertility the experience Progyny into what where in that as successful conditions or include expected that often conceive new Progyny

results to Mark? Let who more turn the the me now call Mark, through detail. over in walk will you

then good I'll quarter million, quarter everyone. XXXX. start fourth fourth and and and overview for expectations Revenue Pete, growth. the provide full Thanks, year was the of our for with an the reflecting results XX% in afternoon, $XXX.X our

XX% result, the doubled market For over past our the billion. With past attests than and years $X.XX the as of over years full a strong achieved executing the size to opportunity this against increase success strategies. our grew year, revenue revenue as more well X to we've our our in X further which substantial tenfold go-to-market

ago both in compared the in quarter year primarily an increase clients growth lives as number to Our the covered the to and was of due year the in period.

of a lives, covered clients of quarter. XX, XXX million fourth X,XXX had compared lives December in with average we covered ago, growth least in of As in XXX to This fourth the at clients representing average an reflecting approximately quarter lives an XX% year X.X lives. and X.X million the

as early year, which approximately lives impact see you effect quarter year what remind of growth the XX%. I'll the this you our rates. of includes the For muting full the full that XXXX increased rate our of to launches, average quarter compared fourth in had growth will

which recent our you in to typical newest XXXX, ordinarily see. we what our is selling more of November, launching season all clients in would substantially expect with told As was we

the and reflected live quarter, clients approximately have we in new of and expectations the new for that gone progression aggregate have quarterly clients Although of representing first QX we in XXXX. our in going majority have live in additional XXX,XXX QX, lives the our

to the the line. year to Turning million. XX% $XXX grew increased million in of the revenue fourth $XXX components quarter in XX% and the to Medical top

Rx. covered primarily in the in million. and the clients million quarter both to Pharmacy by an periods $XX.X growth year XX% grew both the year of clients increased by higher Our number the fourth with a full lives. XX% in was driven increase The Progyny of the quarter number in was growth over in $XXX and to driven revenue

progression choosing the In pharmacy see clients had clients adoption of recent selling to will anticipate from solution. upsell the season, our along the base, XXXX, of our have our approximately in in our newest in That pharmacy. one existing XX% the XX% Rx of XXXX. we nearly solution increased to continue every with activity with clients And approximately that integrated most the XX% our XXXX. of We in

penetration While climb, upsells, continue would narrow. and see of X% to in base the medical growth that difference rates the to pharmacy expect the still we leaves as between continues future for approximately to

More a Turning total and now highest of quarter is performed our were cycles quarter. quarterly XX,XXX XXXX. from than to during our fourth This member the XX% engagement ART the metrics. fourth ever increase

financial rate, For the more cycles results, high extensive the as year than our which corresponds more the to fourth is full the year, ART a in continued the ago. rate it X.XX% for increase an that from the The was female we grew closely treatments of XX%, utilization demand quarter. the reflecting quarter see care. fertility that in fertility captures we X.XX% reported This journey in most

utilization which the as a of the the period full For rate in exceeded reported was was XXXX utilization year, higher the ago we female X.XX% year every in quarter X.XX%, than comparable XXXX.

of for believe increasing vary quarter-to-quarter the as Although a trajectory the reasons for condition can our of we year from family well the year, upward prevalence as the members' utilization reflects including new as overall launches in time many desire the building. the continued infertility client timing medical pursue to of both

XXXX. our Turning $XX.X the profit the margins increase in a Gross which XX% operating was to and from million. a gross This XX point fourth basis XX.X% quarter margin, now fourth expenses. increased quarter yielded of to

leverage from to made modest newer we've in reflecting For realized profit go-to-market revenue and in margin partner of the disclosed was like impact management success. G&A fourth acquisition XX through ago. full The areas quarter build-out our a were year, year our a offset and expense in as XXXX. the labor care in both periods was the retention continue quarter the efficiencies we client clients. Sales investments with shared XX.X% previously to of and containment the quarter channel and The the we've ongoing that the our meaningfully over including of to was partially delivery relationships services of the year. efforts full our Reflecting only compared marketing point be corresponding offset X.X% by increase the gained which revenue cost XX% to year, basis expand XX.X% gross $XXX this the in XXXX that increased our improvement gross million. the resources, XX.X% by prior were of a

our quarter that improvement For as business. the in of compared to full strong primarily XXXX. that operating rapidly operations realize year, continue to we due in we The EBITDA, EBITDA increased in efficiencies XX%. $XX.X is our both of quarter, adjusted the G&A year. In back-office the a to both yielding margin XX.X% the which as fourth well top was efficiencies the revenue, to line growth in and increased both the as year significantly the in XX.X% in XX% quarter expand we and and With even margin realized, million, adjusted the dollars

the the share, received the the offset on primarily compared continued share, On diluted of in of million to now in of periods. also share. This income on higher XXXX. The impact expansion XXXX. in results increase period. and share income We the million non-GAAP the believe as $X.XX year, to any leverage will demonstrating which compensation In of $XX to higher where has was in share XX.X%, $XX.X a business measure we guidance which in year and as or due the EBITDA enhances comparability $XXX we're fourth tax most earnings our provision earnings. We'll basis, most For and capture companies quarter and to further proven forward. continue account a achieve this stock-based million share is taxes we per recent compared revenue, report incremental a XXX as Adjusted per the $X.X which or than moving of reporting of quarter associated basis fourth was of full both which diluted net margin $X.XX higher XX.X% into going adjusted per is or million which $X.XX full in the report XX% to add $X.XX from which for from or excluding that income margin who a just to investors, was year Adjusted the million, to earnings indicator per grow impacts. $XX.X this XXXX. to rate measure clearly adjusted was to diluted a and response of investment is revenue. Net margin EBITDA $X.XX per cohort increased income, the quarter, quarter net profitability yielding did XXXX, highlights the we've be was diluted point feedback compares in useful forward to overall in other $X.XX earnings per more taking issue we've year-ago income current previously our the

the $X.XX year for was year, last as a the quarters. in the today X For adjusted includes $X.XX press for compared The we XXXX. EPS adjusted EPS full reconciliation issued release to over

The Turning which to quarter ago now primarily $XX.X million, balance our in items. year due $XX.X sheet. Operating cash cash was on generated working period. flow timing fourth the was in million compared to capital certain flow the decrease and to

Our the generated at well an midway reflects our year. disclosed pharmacy $XX as with flow highest million, our $XXX that agreement in took full profitability from and effect a previously impact was as operating through double partner, higher than year XXXX cash more amended was the million the which ever

sales our at outstanding result, we improved days concluded XX As from a by XXXX. year-end where days approximately of

cash we of year flow, operating the taxes. excluding expect conversion full EBITDA forward, Looking adjusted a to cash mid XX% any of impact

and of capital approximately As cash, securities of debt. equivalents $XXX marketable of million cash total had reflecting no December we XX, million, working and $XXX

to now expectations year for Finally, the the turning quarter first XXXX. full and our

earlier. in the little a treatment to quarter, headwind bit described that Pete contemplates million $XX are shift $XXX to we first mix between in revenue, the million For million projecting which $XXX you

that the that in guidance that the to is With see consistent activity, more of trending we've reflected we have we more balance recent can year. the our visibility into what over we'd mix and expect,

billion and $X.XXX between revenue $X.XXX reflecting between of For growth of to XX%. XX% XXXX, we project billion,

profitability. Turning to

first to and $XX to equates shares. I'll quarter, This $XX tax to fully $X.XX EBITDA million between in XXX along on of income compensation not including share approximately EPS expect To adjusted the related the $X.XX in the will you, per million. extent XXXX. million does of income between earnings million adjusted diluted We and net $X.XX or $XX.X with $XX.X based basis million to $X.XX we items, benefit those our that of items remind continue related occurs, diluted discrete equity income any contemplate activity. benefit discrete guidance the to from throughout tax activity

For midpoint million the equates $X.XX adjusted diluted between net year growth XXXX. At full share XXXX diluted be million this reflect the million expect million $X.XX These to margins see and in how are incremental basis of XXX $XX.X ranges and margin continued million. both approximately year, XX.X%. fully we the XXXX $XX.X EBITDA between of full for diluted on and $XXX income year of and per line we adjusted revenue for of will to on expansion of the to top and another earnings adjusted earnings guidance, $XXX of per our EBITDA the shares continued to share expecting This $X.XX with $X.XX strong margin expansion.

momentum excited year building behind our for and are generally end-to-end more services to the for energy solution, family continue With see comprehensive we we the the ahead.

Operator, the the for can now like to call questions. you instructions? that, provide open we'd please With

and floor is Absolutely. Thank gentlemen, you. for now the Instructions]. questions. Ladies open [Operator

with Samuel Anne JPMorgan. The comes question from first

looking? a in in we treatment how headwind? you've kind that provide And kind of around you the to year? expect the it remainder in what's the it on quarter Or little up more first to hoping even February. the bit why mix, to XQ? the color bit able be going do year? little But be step just And expect through could of throughout then recovery about rebound think do seen of about that the that the it why was should recover you a Is you you I happening touched to

thanks the Anne, for question.

types the all on. you reason expectations our utilization and our are me large Throughout at that there we been visibility scheduled and for to where history of that of some that of market, returned So in claims time. That is is periods because you consistent, on. And when year-over-year. to for is consistent constant let is our revert relatively treatment population time is have when And based years what the history have to are adjudicated population is -- management The because, is if to incidence our be journeys to when mix and period of give years, periods over going that are going back under full what history, treatment pretty different that be the do and are we to our mix what And our and as for prevalence look continue normal gets expectation. large past but it it's said, especially as referring again, a of acting February year, aberration of going I'm or expectation and through them, the that's again, was years the anomalies off I want blips QX right, pretty a call where received to pathways longer reverted done to started period of been normal again, why That mix continued receiving materially yet, or consistent seeing whatever This them both aberrations that or for 'XX, we where similarly beyond we had and since from the that treatment they're right? most enough, for we time, say of need we the scheduled then into short summer normal. back where relatively balance scheduled to to people the where was treatment pronounced almost middle and had year where of that, we to a February we the you of one we've have -- again, little in lot sort all the every says a treatments, March. and haven't now normal. claims based is but but are terms going that are literally already received March, of, has distribution for on the that's expect

other. maybe just then one And

XXXX they adding the fertility? for you with than could are just season. How selling been benefits new some just what employers like? discuss receptive more have added to conversations You hoping We're

Yes. conversations There's good extensions in have the conversations, fertility given early services Annie, postpartum. are especially -- side for and our are this very a is goes naturally obviously, Michael. Yes, that into good. and amount been the as the products maternity season, interest. we're success logical And us on but the that again, these of

conversations is good perspective and interest client early, the pipeline so a from are again, far. And but so is good

Michael from comes question Cherny Next Leerink with Partners.

you've that first year, long-term not Maybe if I what land just $XX right Annie's said being is had Can out, spread first on mix over the is already given Pete, time guidance I still the have give how has know, the implied is the course talked can you've beyond rest the up more it you trajectory year about of a for pretty no you how transitioning little your the question. dynamic. solid the to million relative you of you about number on just what color matter you been. maybe follow this this

see and that headwind which account help? of calculated the that half the previous is I'm it's in think seasonality pro takes have Does quarter, and short-term Sure. QX, caused for we the what short-term of We mix year half a compared So QX of impact I'll scheduled described, The nature that's in it mix years versus to or and versus remind how you impact change to the quarter the the impact QX. QX calculated. of it first we second the forma the describing, -- revenue And calculation we the effectively the what terms QX what mix and in about way see the has it's it, right? to easiest that is of last right? literally QX that and into

No, business growth And certainly of growth particular, does. about should think think getting it you're opportunity intermediate-term pharmacy then it, we penetration, you dynamics, a levels the of dynamics about call basis. when that business, how on at kind the of the in -- high around

business cross beyond adds? that penetration just that are within been help going already can business natural so other Given the P&L? member other growth where that ways volume should much there's on areas that's you there your or Or grow be that done,

close Mike it's out, terms you penetration back. year It's the we XXX%. opportunities, But a out, getting have. more to close. go that XX% part, bit point relative most client the point of welcome base and by There upsell you little is the for as in getting way, So the but -- is to to this as

from on So does rate are historically, perspective other medical dynamic is only is normal the the into which continue drugs it line top with the to what's play pharmacy that consistent been revenue. That annual that on growth a of in will for -- contribute will the a more that some going reflect formulary, to come for increases and said, growth pharmacy. the

comes with The Santangelo next Jefferies. Glen from question

this business? it your or Alabama that to no governor the want go paying see you ago the I -- watching Roe court concerned? is a regulatory touch the there any in back as your Pete, ruling said out and amount really of any you didn't after change has you're came just Texas on in I or out. to and intent attention office to? far anything did Alabama just of is I and mean talked about wind came come to Wade the to prepared business being -- going your prosecute Or they as sort couple all years And like where up And climate have is families AG versus anything inflection that remarks. know out,

short the of answer millions concern it, coming even talking of IVF, out Roe and or that is, asking that IVF the was were like you're doing laws but when got think believe, about Wade in the just similar the antiabortion get there in where inadvertently then can that So fertility caught overturned, clarity, but didn't up create and had Alabama, v. where couples. practicing certainly, the IVF realizing importance is if which in I do in concern we're and the seeing normal wasn't an family right? But extreme legislative state when thing is Alabama, was bipartisan of the a are more just same happen. they many, a many ruling for Court Court This building Alabama, states former IVF, or thing. clinics effectively they're including that that President, ruling then it including practice had do around Supreme protecting they're on the the embryo case will, a antiabortion they're a X in the everybody, to fixing I and -- state seeing Supreme to watching, most you change, relative for comments from the than legislature the when impact

any if direction. state will And that I relative moving anything will I other believe the the is so I legislature don't you correct, overall will, of impact the have industry. state have believe this a to opinion, for any or what, in hope don't that legislation other Alabama, also there my this to rule. will bad an agree And I

Mark. this And is

of data business up don't Just question. the and putting Alabama, makes really seeing? volume anything and you into but of a X.X% we're U.S. by of less state, first that if Is look part available get outsized fine sort at point SART they your than X% We not us. our the the there on of around from the for are in publicly it the breakdowns

So our overall of they're very, small business. very part

impact that. So not any seeing of we're

if Mark, I could ask just quick the Okay. a question guidance. That's follow-up on helpful.

at all client base I'm covered period And number existing have stop within when or within embedded that X. that existing are that the rolled many organic X.X to wins sort deterioration guidance still us on, have of are said you how within here there. on just to XX/XX? think you growth base? members I you'll Could assuming XXXX any of give as your sort was roll January of end curious assumption, And post I'll of what you million any in kind lives.

Yes.

couple of my pieces comments. So part we prepared a in there's so -- of of here keep some and mind to were

in be approximately lives. So that million QX we X.X will expect

or ] have it X.X-ish. that of for addition you in so and XXX,XXX QX GHA and -- so that, top together you then QX, that In call we'll launching -- we That, be on so closer. lives [ the get with the XXX,XXX or

I rest rounding, in the to honest. frankly, think the is, be

not it's more But significant in organic we not year, I our far as existence, had growth know our growth not guidance, earlier -- the years we're anticipating very, As small. baked we're very that we through organic planning and saw. that into of

is that's for So our year, where this our position now. outlook as of right

America. Up of next is Bank with Lutz Allen

where trying going treatment more here, Pete, mix IUI the it understand exactly I I'm IVF quarter? is want the to few in just and shift -- confidence another the over deeper occurring was the within to give shift to Is bit it -- here. it's the revert you ask business little that the to on digging there less quarters. is a next mix one

Sure. those, XX literally on different getting different of are there's of it And wasn't forms more variations IVF. contribution there has contributions. all lot versus They're And but and mostly different all into No, right? they're they couple if of treatment IVF, of have it again, A have more that different treatments, you revenue sort all those. so is nuances bundles, right? of of detail, them revenue IVF. IUI, on types was a IUI We will, IVF without of of

it's to not so not it's within IUI. IVF -- the some shift a bucket, And

about just up then up the a pretty was And XXXX. X a in that's helpful. on step big X% follow-up quick in female utilization year. And That's

trying in in guide? utilization the XXXX of how think to just should think about we So terms embedded about what's

Sure.

utilization year, For where XXXX. both QX versus we full and essentially the have flat

Schoenhaus next from Scott KeyBanc. comes The with question

I shift. into just So treatment this keep drilling to want

shift minutia medications put on pushout a want XXx medication pronounced of shift the of this a process, treatment be in I December than it will into that more is the IVF can to were the alone probably the kind initial services retrieval process. and sort be in in consult. early consult which retrieval initial just more fine January, egg So in affecting point

Yes. parts which It's more, to terms dosing themselves volumes levels that have you're treatment -- involved way, different treatments of although was it, to drugs again, contribution them. require are contributes pharmacy points different it and IVF. as specialty as as within well price Different of the relative cycle -- the a to pointing initial the by different in of in IVF shift consults do, out,

outsized of combination to it than impact consults driving relative the So treatment. higher the bigger what's to initial impact, is not mix versus on moving normal an

year. made year do I'd making normally earlier, point add And of fine to QX. the to see a you beginning from a a little of -- QX in of bit expect step-up proportion the part of consults the at to comments his the time that, actually just we higher slightly That's Pete initial this comments it's because the there. why contributor see It's

around of mix a Again, what historically. what we've expect here little comments versus QX other year normally. we our of seen the would and all different quarters So is bit see than are to

That's super helpful.

that the you -- and in say quarter? that to a quarter. that it in the medications visibility first the really confidence roll is into the give So we that should second roll fair reramp-up see should in to we acceleration right blip see saw the Should of that half

Yes.

we however said history we're question. and and much full of quarter for higher to first that the be saw in revenue, answer correcting specifically itself first and second on I mix higher years expectation. Again, It's of we what quarter, a before, our the the utilization that medical when Rx -- years is it yes, like first past commented that medications reasons mix in So It's based I'm sure the a of perspective that we -- half history. the history revenue to that's seeing not the my to that contributes said wasn't on on year past the expecting are going in onetime half. I around from it But general, the literally blip or not. in of half in seems

comes Next James Cantor Fitzgerald. with Sarah from question

is geographic trend. about think So 'XX? have think and to you Is mix that just the versus how that for if going going guys we that Or it possible going you do in maybe the given it 'XX forward, and still it cycle that something on on, trend flat? kind progressing up? would about be How product think about January we you ignore anomaly of that's revenue per in underlying the

perspective on per history cycle. would guidance a from revenue point comment of though. sort Smart our I to normally don't We

for reimbursement Our we and the as which the you've therefore, to think where the comes country, there higher of couple going that's history as bigger little Coast, to of coming concentration years bit a down sort continue referenced medical has general, average contribute one and them reasons. versus is per growth and overall contributes company of of rates to lower an Coast, more our across One I which that and contributor a higher higher grow revenue mix, is, previous is, West it's East normally from mix cycle. in of was been a more year and each

sort happening level if might a would history be been would I at I that. -- X, on how is over last that normal some is continue what that couldn't a years. of to you X expect expectation like, tell So based that what's guide, much look the and but

probably for on you than stand Now it in basis, point full little revenue you. certainly the best year there's look the that of of clients comparison 'XX medical, prior the remember, step the though, a are which that all bit have the we'll greater a a comments But proportion if higher benefit have rate. Rx that is up for a at of attach because so

And more, Great. could. if one I

You guys at have fantastic flow. been generating cash

deploying about have large that think a you You do balance How now. capital?

some at that capital continue here we'll we of that sort sort sit to now, to look or explore point, use not to there. capital, we upcoming end, we as and some to calls. there's share opportunities a in harder of We those of thoughts take as continue optionality To will out other opportunities look whether at at continue that we -- as relative

Singh Securities. The Truist with question from Okay. comes Jailendra next

this this QX. impact split impact? Rx? And medical going treatment industry there with I'm taking What year, summer this the this A summer headwind to having something in because then beginning shift that saw shift across first. But between a to this like the was for this The revenue compare in back of cleanup a Pete, the vacation. geography EBITDA know, people the you was is revenue asking at that trying $XX little related of seasonality to mix for there you Apologies this surprising, board? second or reason treatment and as questions this is of was Or for million couple question million back I And the keep but. happening mix attributed how $XX Progyny of particular that, concentrated? you're possibility XXXX, but

Well, thanks for Jailendra. questions, the

points types why a they time medical treatment they're where of in different concentration do they're to that nobody history. more what anomalous, parts happenstance there's before different, and do. let public, on might you going are doing. They're When it what they're we it of of tells lower journey, is talked have doing sort cause idea. The And contribute a than what weren't again us in happened it give in some So in we and was when it's because wasn't It's me they happened questions what that is but I usually of short summer or other the to duration, it going about be. Relative it it your -- in we reality they're happen surmised a were. 'XX, concentration, forgot are of When revenue anomalous higher right? we The no effect. to or in reality sort is year.

So the contribution of EBITDA of... sort

] on the describe sort of relatively Well, own calcu to EBITDA it. be your the contribution you of best is And normal way would drop-through do sort [ could that.

medical breaking we with to apart the guide sort our out sort medical don't between of and already. As pharmacy pharmacy, of and guidance, broken it to relates impact

So I'm would be. not sure that how instructive

that And not break to so we're out. going

gross margin. of XXXX. on share your follow-up can my expectations in for Anything terms then And you Okay.

basis trends point similar in think 'XX. You guys in reported next year-over-year 'XX? we a expansion Should XX --

Sales a sort that Mark So you marketing a expansion number. as there, and of The peg sort I of give of think full wouldn't to sort his relative exactly for frame across give on reference. adjusted the leverage take margin why to about dollars some to don't right? come of we margin year but for expectations. there's of that, G&A, talked reality the since look the in lot start commenting is and business. we That's the you comments. either, margin from premature 'XX do it's I guidance at guide But EBITDA certainly

Davis Next is with Barclays. Stephanie

your about I'm around apologies benefit this? would ask regulation what from call because airport of in that outs you Are carve by little impacted out that lot there's again, the noise. year. pharmacy for concerns by beginning does bit pharmacy are benefit And for protections factor year the I election to being of how you or shield if your want year? background a any the there story of it that we because into the would means the hearing a the PBM. Or outlook think my of any

around I you're what The the change to I'm that's exactly transparency as and sure being of far is any clients step PBM out discussed of not not around to said, to of will different. relative sort the aware, economics regulatory mostly regulation. members model sort our of point the and I'm That the it's referring relative world, as right? our that

rebate, As point-of-sale check, model. to it. But can it the to themselves to you about I is rebate formulary that the so attorneys out me or and it relates relative to individually if our to give from benefit there nothing the I'm will, of pricing talked the that economically members an all there's a as cut we don't it to client, also concern causes that seeing relative hearing impact

furtherance that the potentially. being some stuff transparency the it discussed, think of I just it's like sounds laws

years. want the same to the some need still we've that conservatism just That for in it's is touch but your then margins benefit pace for on rebate pharmacy expanding maybe info that And seen a not the like was you of it know. margins, that looks reach because to will you're all much How bit few versus rate I past outlook? this the I penetration

already. larger it business on the all medical to revenue again, years achieved. side guidance It's peg in comparable relative the pharmacy overall necessarily I expansion. early margin say, it's our overall overall wouldn't the we The the see year to pretty not. prior would to the to I versus are it's to where contributes And in, think or dollars and I Well, we've growth settle what

been that the So given all I we would if in we again in my the achieving a for We've I some the of multiproduct remarks, 'XX that, say company. the prepared year, overall, that That's it, one-product you have. we think right, 'XX but continued company. XXXX, lot investing a planned still in a -- margins in effectively more all of investment about And in with becoming we're to and as were that before referred P&L.

So I pretty think expand our that's given amount good a investment financial picture portfolio. product the doing we to of are that

with Larsen BTIG. Up next is David

Jenny Shen on Larson. is This David for

Just on competition. one

So in digits. mentioned market the share right now your low that pretty is mid-single you

I competitive from run business So your are views competitors benefits prospective where most whether you're taking having before wins competition? other just of whether or the was clients, and your you environment, away on you're who've offered now competitive into right when whether clients wondering from fertility wins never with discussions they're

first. part second do the Thanks for the I'll question.

selling prior comments to season. my relate all So

had So 'XX sort it's almost year never you and have if from or i.e., the the to on 'XX percent the in some season, But past in the come form early history sort seasons. season, clients activity. the XX-XX season, selling comment wins as from selling too fertility been the selling of take selling 'XX current clients our brownfield, that i.e., greenfield, a that X benefit a had recent that's of benefit, of

question. of your the that, part of X/X, the X/X Before question? part versus was What first of That was it brownfield more was the sort greenfield.

part during was sales. -- From competition to second related I think the

win So and first the we are each sale with and health -- first benefit. off, competing, each plans -- really each foremost we

available had And so as then And on a the something from we've health while only as always that's market there. that it against competing we're should and reasons. for that's lot something variety versus... the but solutions been with plan consistent of of success in I front plan from a the early on Pete picked now. far, some or see So selling against the solutions. -- and whether on basis. say, this we're said, That's whether a has obviously, always picked that's But with compete the front. We've something that's for and position competing case-by-case certainly, competing up we're employer competitive do seeing new a -- industry year of again, and side health varies has a that again, in nothing other up, point Again, the interest the nothing point from year we the not that and new,

XXXX? some That last of makes think throughout it. and you headwinds Got sense. decisions, can some mentioned of in you year, become the do I the think those quarter And now tailwinds

Yes. mean, every these first our -- not-nows these strategic off. at not-nows making. I are that employers see And year, times are we are decisions are so again, --

And something a so those it's next process, or sometimes year's they along lines. go through and priority

So we do see every them year.

certainly at in the mentioned strong our Pete majority early like Again, a pipeline up we're not-now his As not-nows pipeline make to But year year this perspective. of make on too opportunities comments, become new an year active early the the from going -- position in usually this. Currently, a materialize. from is year, the certainly that predictions year, different. into last they no many and become will in not-nows how around

like for to in queue. James turn back now Hart no are There would floor to I the questions further remarks. closing

John, you, for us you, and everyone, thank afternoon. this Thank joining

to couple free feel months, a in actually. giving good Otherwise, Thanks to reach you afternoon. have update much. questions. any just of please look a forward to we always, next our out you me Have As if

ladies you, and does Thank today's This conference call. gentlemen. conclude

lines wonderful for you have phone participation. and time, your your disconnect may a at day. Thank this You