Change Healthcare (CHNG) 7 Nov 202021 Q2 Earnings call transcript

Ladies and gentlemen, thank you for standing by, and welcome to the Change Healthcare Inc. Q2 FY '21 Earnings Conference Call [Operator Instructions]. It is now my pleasure to hand the conference over to Mr. Evan Smith. Please go ahead, sir.

you. Thank and of Healthcare's September Fiscal everybody, the Call XX, to Quarter Second XXXX, welcome morning, Earnings Change for XXXX. Good which ended President Eliasson, today CEO; Officer. President joined with de Financial Change I'm Neil and Chief and Healthcare's Change Healthcare's Fredrik Executive Vice Crescenzo, and

your the our After will Neil for outlook call closing from Neil. review followed we'll business for open the up then Fredrik update by First, results and quarter that, the a will provide financial questions. and provide remarks

the this at of conference of section to and Neil? measures law, I'll Before statements statements. assumes begin, remind from the copies any refer Change to GAAP update and over slides financial remind I that that more we may we discussed the information. where to included like I'd or to obligation Neil. financial measures With everybody are conference the materially supplemental which available Healthcare filings. in by company's release the by turn on our that, detail no forward-looking are the earnings to today's in earnings in comments Reconciliations also non-GAAP call financial will website SEC supplemental comments Investor appropriate, www.changehealthcare.com. call release reasons, to accompanying for business. the differ note want Actual Relations Please to included results in our are of accompanying suggested evaluate include our this measures the that required the everybody slides presentation. several non-GAAP Except appendix for our call forward-looking results as

Thank you, Evan. morning, Good everyone.

and I we the go by healthy lives. impacted day-to-day Today, review and to platform. in clearly our we accelerate sales into opportunity. everyone ongoing I and the Healthcare's will to our the continued innovation new initiatives through Change second and I'll the and new While the growth our as our customers manage quarter remains personal product activities, our performance in continued business about momentum normal safe COVID-XX strong expand we value professional hope across way healthcare all the our and utilization to continue has driven and delivering successes, market our provide rebound completed in strategic insights on execution

can the you X, by activity the positive. Slide continued As system in to see has on chart healthcare trend

utilization and Although part underlying result will assuming as hospitalization our negative a these levels hesitation well individuals markets healthcare return utilization. on as the normal to prior potential on some the we volatility by healthcare trends of to rates continue changes end year, COVID-XX to infection believe impacts in we are and fiscal of in as certain the potential of some resume still

in quarter, three our role Healthcare are our supporting and Healthcare's solution. activity and areas address CMS' all by potential These Connected evidenced Underlying of we pandemic bookings an e-commerce retrievable digital and data Change are our addition above for to consumer care with we industry last all payment as suite, indicated demand our flash where reported IT on both the interoperability pulse expectations. Health COVID-XX the commissioned Health previous and leaders healthcare Executive and believe Group, increasing with curve innovation and during and positive our beyond, APIs our interoperability. the are utilization, trends are across long-term budgets telehealth solutions leaders access are emphasis and and interoperability to recently experience, launched report, the we platform. seeing accelerating leading clinical Consumer transformation patient customer indicators improvement to we As in continue segments. positive be

strong our line for results continued the for as new and business we second utilization lines highlight financial with I'll our the as implementation reported time in performance briefly the quarter. well Now In market quarter. improvement momentum,

Our and earnings share of adjusted per cash per of produced of over diluted flow share revenue adjusted team $X.XX million, the million, free quarter. $XXX $XXX of $XX EBITDA solutions million during

Given $XXX of detail B. following provide and Loan on Term our repaid year-to-date, financial outlook our million strength and remarks. will Fredrik we liquidity our of the performance more performance my

Our second our accelerate going structure enterprise focus optimize continued on innovation and quarter the forward. results and across to our while we cost performance sales our platform demonstrate to efforts continue growth

recognizing the AI the Now accuracy industry's workflow coordination value-added solutions network, capabilities. business and let extensive data leverage that our our success payment using payers more on and provide an new More and assets of value in front-end on our me benefit update front. extensive our the of our our position are and

and several the presents billion a demand major which billing lower bringing technology, advancing the collections current unique in the our risk RCM displacing deals, the by for AI of In increasing major additional In to given capabilities. we major trends, in price that and creates market. enterprise episode. at improved market. signed increased we competitors deals, patient with signed the improve reimbursement and in point workflow adjustment to of Coding data position further $X saw estimates for CMS two by perfect help new the Medicaid We $XX plan, Access Blues unique better signed or In supported and solution demand significant continue satisfaction. telehealth our to average a pipeline adjustment, changes quarter, a health service hospitals During our competitor our grow systems our Imaging Suite, before state innovation case business, for have per capabilities and billion space increase Enterprise our better Patient models dynamic leveraging replaced at patient use and ROI Advisor, offering a COB Clearance risk the and one health mandate a a is for data, expansion AI of our sizable transparency business our plan we a with and

we value a customer for our core within annual large also RCM multimillion had including Coast as a grow wins, average deals. million expand of we extent positive base, our wins service contract underscore business, our and closing three provide notable West to several expansion to rates representing network, scale bookings which our we strategic breadth, integrated ongoing with dollar delivery for pipeline quality success new around share size, in our continue competitors. also and offerings. take want deal from clinical to trends new the dollars Services I continue logo In In solutions multimillion sales dollar addition color and of in cardiology win some to our the

York access services with million the IDNs country. governments, like healthcare patient other as annual the totaling as Helix, large-scale multiple leading contract a deals lab the PCR for to in in pharmacies further performance than organizations contract Services underlying new up set telehealth of $XX clients transformation or in 'XX. a for RCM clinical country multimillion-dollar across more significant FY we adding growth us to and providers, closed RCM one First, mid- retail the and New providers foundation We in strengthen largest Services testing and wins supporting with serving These well COVID-XX new the signed in hospital value. groups for new

to and products spanning network, the XX center. payments, During intelligent new experience Services healthcare added medical our also API analytics Connection our patient quarter, we & platform marketplace,

API eligibility providing with to payment to million to in and marketplace power large solutions revenue more million contracts BXB We cycle national Our several business, the we win addition worth payments workflows. now new two our management, first API XX medical volume including continue over the annually dollars products, quarter. In doubling offers in QX, XX plan transactions compared volumes processed over to dental companies. recovering, than business,

additional a solution, allows healthcare more We also Shop choices. active deals to play Connected for and Consumer our Health role signed in specifically and Book patients our Pay which suite their

in We efforts for and were and Just overall transparency, or patient additional healthcare June, in provider large have our signed & the who we strong want clients with that several RFP recognized for in in solutions Technology our in Enabling improving to of helping Sullivan organizations revenue. I consumerism with announced North have in are consumerism price opportunities, recognized addressing processes rise to related Frost space of experience patient and America. Leadership has contracting note also either challenges a the healthcare. Award solve number the performance satisfaction already

we also growth. three accelerate key During executed the on to quarter, objectives our and position strengthen market our

in solutions new launched and clinical or InterQual our we pharmacy support, decision both First, network franchises.

distribution our we Software Second, And Imaging we for and the agreement & expand with technology signing Vizient. our Enterprise capabilities value-based acquired with advanced two of year franchises. both Analytics continue software healthcare to a third,

efficiency as the a from extracts AI provide color me bit clinical franchise, clinical of application take over administrative a we much clinical little this highly our automated task support, InterQual automatically perspective, let In burden this decision medical on data these. staff. significant necessity diagnostic skilled reviews more to To launched a notes XX minutes a increase put XX%. review new typical or by that can on Now for in and places as

of more payers and with now within shots, agreements models. service for workflow. to their process to easily To signing we the multimillion-dollar network, navigate move largest for completed bill reimbursement flu in on changes we This into the regular as enables bill insert COVID-XX electronically just easily we as one continue COVID-XX providers of new capabilities. U.S. acquisitions service intelligence pharmacies with We and both that introduced end, support in testing deal they workflow. innovate as we dialysis for pharmacies signed the as helping means with strategic and pharmacy payers clinical to prescriptions can for now our they In this quarter. the a including a expansion reimbursement I'll tests test receive providers and InterQual the market providers, in

X,XXX the diagnostic and capabilities. expands that Nucleus.io and to radiologists individual their assessment line PROMETHEUS cloud-native our installed initiatives. a buy-versus-build imaging Analytics their enterprise During a exchange also image Nucleus.io quicker radiology efforts our development advance bureau with service. for our acquired Nucleus.io to care value-based given of workflow opportunity time and practices quarter, with rendering our base market superior users enhance provided for is we classic cloud-native

this identifies methodology Our solution, healthcare strategy. is leveraged network medical provider their second HealthQx helps efficiency. value-based analyzes provider acquisition Having improves Analytics a episodes Analytics and care, example already performance, networks acquisition care our value-based optimize under The great variations our of care payers PROMETHEUS models. solution acquisition, models, in the payment try-before-you-buy reimbursement evaluates creates PROMETHEUS

we to country. and contracts the strategy cardiology members, Lastly, care largest purchasing Healthcare hemodynamic our two the solutions. of centers in with signing group Vizient, include Vizient access our than acute Change monitoring medical expand more channel XX% healthcare and of XX% multiyear These Imaging the U.S. academic providers to give agreements in Enterprise continue by which

and centricity, and consumer even the that closing, digital the confident healthcare to to where this elements play toward the helping efficiency Change enterprisewide are platform, So to a in the manage and not critical health insights where insights are pandemic and more deliver Therefore, central experiences for need continue access move management, central outcomes. connectivity, necessary innovation, discrete our which where journey to and organizations or the remain highlighted is improved best-in-class and more episodes, and care in has throughout will front transaction doors transformation. just deliver provides customers data delivery, cost, improve through industry we healthcare Healthcare's decisively patient which reduce to virtual integrated role

call who Fredrik? review the our turn me let and financial outlook. to Fredrik, performance will Now over

play underscoring trend the everyone. was of result the believe to pre-COVID happy a previously Neil. healthcare quarter, quarter. the and and visits toward second recovery Good healthcare some underlying We normal demand to catch-up in you, the deferred system improve continued a of morning, Thank procedures. we throughout to I'm central as the more levels role report activity activity strong

anticipate As note across to Neil I results reception change underlying related mentioned, We sales second our these that as third deferred $XX solutions. of by we including employees normalize. as a continue our strength starting timing majority positive healthcare for of lower expenses costs, as newly business a in quarter benefits our the result lower SG&A to reduced the in related to platform, reflects the approximately introduced see market utilization primarily efforts to in million in healthcare policy, to a result and onetime back of to activity want come a continues quarter hiring COVID-XX. expenses

outlook more performance with our quarter move of on and provide for seven. fiscal me of now our the third 'XX. detail quarter Let quarterly second for the Starting slide to

second increase by offset Results $XXX with year. was revenue of reflect in Net declined prior fiscal related as million $X.XX for Adjusted a in in outline compared adjustment quarter COVID-XX, the of diluted million, $X.XX per There units X.X%. synergy lower-than-normal was M&A solutions to XXX quarter, noted net net quarter M&A the or to activity $XX in mentioned second year. and the revenue of fiscal result loss in in net EBITDA, in Adjusted in reflects the prior quarter resulting $XX loss reduction new million revenue $XX in year. diluted quarter the impact and increase the adjusted from The deferred second $XX for impact fiscal that of to same in benefit period $XXX quarter. and For the $XXX,XXX adjusted revenue lower unit diluted well for compared the was the outstanding sales million activity, $XXX as the the growth deferred as diluted value 'XX. year. of including fully million interest second of $XXX fair million EBITDA of prior period the the revenue expense negative revenue the income a of with the income quarter. organic of Net unit the adjusted exit same a of positive share million, part the compared adjustment fiscal $X.XX fiscal compared million our same Adjusted net the net as income a as year-over-year a period SG&A cost per $XXX million, earlier, share outstanding of also compared incremental approximately were $X McKesson loss net 'XX partially the to the of of well impact of of quarter as diluted as EBITDA and reflects prior the million million items I associated realization the debt. per XXX income the was net shares of adjusted or fully the per with million of resulting of in diluted $X.XX of fiscal for

let's detail segments X.X% at a revenue. Starting look in by our on with declined Now take performance The year-over-year. more Analytics Software of X. the Slide segment

divestiture. solutions the due with grew contingency-based Analytics our a prior businesses, flat Connected segment solutions Software approximately and after Our primarily into was essentially our which taking Analytics legacy Revenue of single million the offset low year $XX impact the in non-subscription COVID-XX. RCM was XX% in with account an digits, in subscription-based decrease imaging to

enterprise in to wins remainder continue segment payment decision well and across bodes as increased We 'XX. the for with risk 'XX believe momentum accuracy, of solution, adjustment pipeline as support, activity see well imaging we new fiscal the in the cloud-based fiscal which

Solutions from XX.X% million year-over-year, includes which in $XX Network increased acquisitions. revenue by revenue Our

both and of Key implementation impact businesses, of from the to grew customers revenue new network payments BXB in the our quarter. growth Excluding include X.X% data solutions acquisitions, in growing high-teens. mid- drivers

strong from resulting volume about from In lower X% COVID-XX. in penetration revenue although still We We print This and also Services and of benefited our approximately saw network, pre-COVID-XX compared volumes. and the was overall X.X%. Technology-Enabled a increased revenue segment, business API-driven exhibit XX% market RCM offset increased expansion from X% communication recovery, lower for new and declined headwinds to Services opportunities market solutions our business.

RCM turnaround deal positive RCM track, on remain and win size. both to we Our in efforts and see continue trends rates

adjusted EBITDA. to Turning

year-over-year. X.X% increased Analytics Software

increased number Results I'll the on Services, and investment eRx initiatives continued of and our our the EBITDA and of network quarter, declined volumes transformation, primarily details the are Print have were underlying Services new Imaging in under able to include XX.X% support to this COVID-XX AI and also product related to support optimization the Analytics. more of in costs Connected continuing moment. the in sale To our across lower offset make Technology-Enabled performance way. the While our by market the RCM impact to expansion business businesses. strengthen acquisition we of by launches quarter, investments Solutions business. In initiatives XX.X% Network significant a primarily to RCM further additional manage adjusted and we in Enterprise adjusted initiatives the of EBITDA Communication we driven implementing driven Services provide transformation, COVID-XX PDX. growth to support in to effectively and the our

business $XXX cash million million full balance stronger for cash and cash second the to the quarter flow flow and same period to compared was in compared our year. performance on on Moving cash quarter capital flow fiscal increased Free working free fiscal in $XX million $XX nine. sheet slide prior our the has flow improved outlook. the to our $XX Overall, of confidence year. million Adjusted in is last year

the the ending the portion, at cash in short-term $XXX of strong, million net in which of Total long-term X.X leverage includes million capacity. cash slightly $XXX $XX under and quarter quarter. of was the with remains at in facility and liquidity billion, agreement undrawn loan quarter equivalents term $X.X million included end. revolver end, quarter Our during repayment over obligations ratio cash net was Credit debt

Given free the quarter working the improvement our company repaid outlook for in year, incremental an the for in facility loan the obligations. to term end, subsequent flow and capital $XX additional cash million

assumptions quarter, Slide move supplemental the and XX full information Let's with for certain fiscal guidance the financial year. third to for for along

million we reduce per $X.XX a McKesson by exit, be third $XX of $XXX solutions due revenue to Adjusted to million in million, deferred $XXX to a to reduction adjustment the fiscal revenue impact be expect million quarter $X.XX to which revenue to third and share. to be $XXX earnings which related $XXX share per to million. in EBITDA the adjusted For fair reported includes quarter, value will the the

impact while XX% revenue grow or which based, expected the color maintenance Analytics, to the S&A to by certain about requirements. is in digits, is estimated have renewal segment. in additional currently is the In a the contingency is of number implementation, approximately subscription third low volume a single and procedure or and by decreases quarter. XX% driven on provide me is timing The by relaxation Let negative Software X% reporting states impact of of of

payments quarter, quarter each volumes impacted the in addition, by market we Analytics. BXB and of gains, trends about share based the revenue. high-teens a data will in be third current anticipate solutions, In decline includes trends, on Network the network divestiture second by of Solutions, similar as volume offset growth Connected X% about Network X% Solutions In to representing the mid- which

the third quarter on be eRx by year-over-year of the and we're second quarter. quarter in expecting addition, impacted we're the second Services, other Payment acquisition quarter, and revenue Consumer XX% expecting Technology-Enabled a in line In will remain X% about RCM about third improving Communication decline In decline Network stable. of contingency-based for the sequentially In the Services, the with PDX. and from a average businesses

$XX by As of have and our 'XX one decline lag impact half by to decision stated, a impacted revenue million Services between second on business. EBITDA is we This quarter. cost a significant revenue also per the approximately in-source impacted related will by previously our customers the to of current this portion contract. will be of fiscal Adjusted be anticipated exacerbated and RCM related an to takeout their

in to to allow us continue operating value of the shareholder million basis. tests, creation further of part opportunity an customer a period increasing improve approximately of ongoing on our have run with $XX our XX-month and rate cost-saving transformational innovation a performance we value. would program started of This implementation enhanced and As accelerated efforts our

flow. through in customer collections accelerated workflows and value cash AI-enabled deliver enhanced increased automated investment will greater Our and

partnerships some across services facilities me through focused cost and as and portfolio. and we assumptions of information certain efficiencies for functions increased as fiscal vendor provide 'XX. well existing on with global strategic our let you and fixed Additionally, supplemental driving full Last, optimization year are offshore productivity further operating

of in or we restrictions. expect that will material COVID-related will and utilization throughout trends healthcare First, be continue procedure to year, changes volume, the remainder fiscal gradually improve there no the

we're Second, assumption. our flow increasing free cash

this flow million working be percent outlook As and growth solutions free the be is fair X% assumption the million for integration-related the The ahead and in opportunities us around reason we trends, to quarter. the of collections, flow prior COVID-XX Incorporated prior solutions cash improved $XXX is full very temporary capital revenue, cases. to free expenditures excluding impact operating decline an versus in from capex, a $XX both integration-related no expenditures in approximately $XX 'XX our guidance earnings range. strong in be of is and due I as improved noted, the capex a expect approximately because and guidance adjustments now to year change year revenue million year. of increase million, capital the this cash revenue, $XXX around due will of to we X% Integration-related value to estimated of X.X% that to see of specifically

about $XXX of be our of tax approximately for of be includes million number year. Adjusted XX%. minimum $XXX of expense now shares a diluted will XXX the result effective And debt, we to TEUs. which interest in expect As to shares million of rate outstanding fiscal basic the the repayment million, and range the fully for

it Now let me to his closing that, comments. back over for Neil with turn

Thank opportunities deliver of will from enable to members, accelerated customers growth communities enhance Change the lower will summarize, combination you, across continue future we innovation platform new customers and questions. our and the now our improve of environment to to us costs, performance. we current and dedication solutions positive Thanks Healthcare to growing reception value to navigate the access to Thank the existing and demand Fredrik. helping serve, the and and believe team we new you, and take market improved To deliver outcomes. and the them we

[Operator Instructions].

John Ransom Raymond of will the Our with from first question come line James.

say payer-facing short in comments, more Is to wins triangulating share just morning. that fair term? market your your innovation it the and good that, Hey, are

I between the John, it's balance a two. think

COB AI behalf to in innovate particularly we've also differentiation, a as lot of our I side, we're elements our of customers. the to there's on where demand accuracy what have provider especially as our and described been I obviously in consumerism-oriented and I But think, and as and across we leveraging the work think through we're board. the that -- coding discussing attraction for dramatic, on as consumerism-oriented the well innovation advisor due doing we payment able with increase has the including It's been particularly the where wins, the the of data we in space, seeing providers for pandemic. have the think network, solutions just, solutions particularly

And at you guidance what and my follow there would this level, be was I up a at in you utilization your the faster above slide continues get initially little October if if at than terms deck look -- recovery? you initial look aren't So -- you numbers at trending it of will XXX%, said? will your

I Well, our in between market our medical network there said combination, see as is prepared the gains slide share and remarks, this what underlying on utilization. think you we of

we've we we're market seen at that level. gains the pre-COVID see utilization our that think But So can slide that's consistent you still of on levels X% in guidance. and because that's our of with -- at is share, so still the XXX%, that reflective below or

JPMorgan. line from come Lisa Gill will question next with The of the

Hi, it's Annie Samuel on for Lisa.

Software the your ramp that wondering, Analytics singles. is that within disruption purchasing? up seeing to of segment just And any to you're COVID up was that low there can subscription quickly digits? around how longer-term mid-single segment target spoke You & I business

was focused I catching either the be, increasing as may Fredrik actually, directly, know, in because, for our degree that's to see don't what But costs would revenues earlier year some their part still people's seeing the as lag around a think to we're both. we're normal beginning as with described, or up be much QX, feeling. think when more the talking of But our as you from expectations level. others I about and described implementations pretty really in a as reducing solutions maybe combination on you or there's disruption and Well, ramp. just we

handling this customers. nature help even I some of some the because complexities or solutions of financial COVID our future systems concerned impact think demand the healthcare winter, out how are of look positioned with So of of particularly to help at about the just performance, that either the our we're in of well them their they

maybe P&L? was when you cost just that? color the the wondering And think we if that announced. that the just cadence initiatives What I little catalyzed bit about will savings a on come could of And how you should more through provide

it's savings. collections, automation is measure enhanced. going things the that's the vendors, way really ongoing fiscal how the solutions savings right at between should the facility we $XX million you what offshoring, to is that as see the we opportunities about to And our workflow following But coming months increased -- There's started initiatives, across so to the FY we of productivity process. year 'XX think basically is there's some that now AI-enabled consolidation XX we're and expect gamut of And doing well. beginning obviously of really, that there's improve there's some of also and

drive us, across only better test customers. to but our it's also value customer cost a board for So not for lower the structure

X% is about longer-term we this your kind margin think as And X% to incremental that? to growth of target,

be think to it. support I there going it's to

very obviously, we're COVID of, has the are target. medium-term what X% to to that said that -- we say, today, There's X% where impacted. is also X% clear we to we've think I that our would kind X% the

step to step I growth at rate, our But a growth think got that one an do get rate. one like a we clearly, at will time. but allow But got we supports time. even to us this business time a to get to longer higher something term over higher

Our Jones line next question the from come with Robert of will Goldman Sachs.

This is Jack Rogoff on Bob. for

impact. of volatility backdrop the about year-end. And end continued for Neil, utilization into utilization I talked step about I think improving we and your you So the taking COVID through rising think a should of might cases on fiscal think have year? just how the guess, utilization, I expectations back, talked about Fredrik, some against you healthcare negative

as our dynamics business think we've all anything identified thing to our what do And into and least are have would we the than a that as sets, in guidance Fredrik other tried certain that in say, have a I happening that I sets end as around diversified remember we've geographies tried to that incorporated across particularly COVID, we at -- our approach. you some changes product issues this around markets, our including customer the we've such balanced pandemic, are think along mentioned, material problematic. truly issues during to balanced

the I So increasing fiscal as our spring some disruptions we year, to and balance in in a guidance, to back of we've next in accommodated And the level that and utilization so gradually see and believe continue business. toward normal we're breadth locations, think we're because consider getting if of we of our I our some what do again able seeing sort are to there period. in

thinking And approval vaccine, anticipate of eventual COVID of distribution connect you that move COVID the And then you? to would the U.S. vaccine vaccination your would population guess, from would network? a the I about needle for revenue that

Yes.

as position call the been the we're and sure system. from in as you aware, has if important a pharmacy vaccine healthcare there's market. the regarding eRx have established want because role you the you're pharmacies I PDX, that. activity distribution to particularly purchase are think of to as, going benefit course, of the again, know, in more And it, you traditional as U.S. already probably our And the nature as any well pharmacy we've I'm companies of the mentioned press know, solutions, and of strong a to very time, with in able healthcare system Network

look all in segment, the a to of of we have a we would healthcare provide, of $X.X given I as our U.S. the the pharmacy what to expect system, So including having be think that impact. But we to these company. at activities again, measured trillion breadth beneficial midst across

comes from Our with line Citi. of Grosslight Daniel next the question

the of exactly spike the around in you estimates. revenue $XX out apart fell a to drove time grew Going million quarter. a bit deeper into I and adjusted $XX of some If adjust million analytics. million, S&A this strong portion It a S&A slightly my for onetime benefit, out around what take like whereas connected benefit? $X.X Can $X I looks that EBITDA according from result million one that EBITDA little

I quarter a I every point mean, I think anything different few has to can't specifically. Yes. items.

we've on of that the on said And obviously, cost million. on there's S&A to portion see. top million that continued $XX big to initiatives that that, that, And top our $XX and pretty the of -- it's of executing good therefore, then, since based right gets great there million probably allocate $XX a is which that that, after You're revenue. on, team

quarter And time. time a be indicate the little would favorable that to this but from you time, what was run rate to perhaps than bit more happens over so

that. just very It one there specific nature the by and time quarter So was well nothing team. good in was drove executed that or

the said that take of impact the I you essentially some expect from And to in previously think year, account into last deferred when you M&A. you've fourth quarter be flat the

of sequential I think, that to anticipate estimates, -- going implies the from normalization COVID? Where growth just apart my the sort return XQ. a coming quarter, from high again you single-digit do that over in growth of

is impact broad-based underlying And bit right, fourth, as we which moment, quarter of point. us able it. course, the as and with or that bit year. more addition consistently cost I quarter expect to our being be as out. would I we go quarter-by-quarter changed year. sort more take to we quarter revenue you're said that, strange you're of But the of has past. mean continued going kind what And of going fundamentally think of as third little in we last would seen world we business did that little might third And prior a in -- probably to have overall, the The pickup to in that's clearly, is the between fourth that the in But and the Yes. fourth, leaving that the that in said the through we well finding the living before. the you've certainty business different of except at our mix year. RCM this anything from think growth fourth at year-over-year rest in that fiscal customer with right obviously, the of a consistent normalization a bit the see the delay now and perhaps we're the don't sequentially be the in between third quarter, gave same expect And to little why visibility, the the we I've But more guidance. we're I

from SVB comes question next Stephanie of the line Davis Leerink. with Our

First one a like How pandemic? things for that geographic much of more weeks. being given or platform is very flow-through rationalization margin high opportunistic your recent the me. your I've noticed compared in the up of scaling operating in leverage with

we're things think, have nothing that, sustainable. see the is to in $XX business mean, back. very I when very margins. were unusual beyond especially -- we -- you I from terms And three want there. because think sort million blessed very continue we I that and this incremental so But since a obviously, high Neil, margins I But business anything with start with margins there that you we clearly perspective. we we if of are has why a number. That's me as confluence highlighted that clearly, feel highlighted. of that that coming the of attractive incremental don't let not was add know, high want that Well, to

No.

I in lot particularly business. think, network calls a innovate we continue we've as with in described to offerings, the Stephanie, as previous of well,

continued some share telehealth data solid talk heard core as take business. new new we our the there with faster-growing and just particularly ability mentioned, and in there and investments the substantial Fredrik fast-growing the seen has customers because we year from that the well. made including of payments last to You the addition, like others, network to companies, we've as in continue through and solutions about attachments API increasing over we've areas the like our from like serve, been But offerings growth business growth

follow the of the lot those compared broad patient a some of solution Maybe like to you players you have a quick kind the mentioned on that a initiatives your are in market? existing data set of up differentiating you of How with experience.

to from area be we're the to sort is investment needs now they deciding one think have them, while I a customers chance of them hearing that some on that for been prior an a could serious sort of need pandemic. advantage that truly is the reticent scaled get otherwise they're beginning to together they knitting But a see some that they things vendors. has on of smaller So in more of what may this the gone over player what bit by to little that

of point future-proofed as this a might become markets, case of bit So of thinking that that think, over fashion smarter providers, versus some and be out they when platform continues leverage a to use working patient by of to the about many the that in to vendors. better core start need see smaller in they gets than that, a to customers think want patients time. and provide or the realize you liability, period through as their allows estimates, of see point really what better a they more us I extended smarter we mentioned, and case, our it customer, about data, software operations them to with having get they an of because And the solutions, from in platforms them with of

the question comes next Wieland with of line Our Piper Sandler. Sean from

the understanding this revenue in-source And of can get behind the to a better retention cycle, in we decision segment? reasons rate to does that? just do what client The that

of been this them having as Sure. they even And managed a wanted because they felt handle Well, of of scale the with orderly. believe they with something it's us, us Fredrik they is the this it, impact services terms to in-source financial couple something they mentioned, do that had things. that a to we've very was One, actually, though a of carefully. themselves, very customer reached in that decided Sean, part they

continue level. us, high our other areas, business recent in quarters their their are including expand services within patients obviously, and with their business. the to So including maintained at service They a

And if X% so we investors But aspect. because why customer revenue. more business, the reason there's for was our of it is rest the at a than just that's such look significant no this highlighted services you of

this think why our balance and was breadth aberration large in I bit a we and So terms highlighted of a of customer it. the and business, that's of an very otherwise

a business risk It out of But And to times. a like your XXXX? call EDPS on I business wanted then made adjustment understanding of separately, this get -- CMS in changing migrates trending RAPS as you from couple you see that's a sounds how to better well.

that data to XXXX for EDPS in they probably dates only XXXX both are going a that's, submit of and could kind we able know, Sean, And you through to use complicated RAPS as people area service. September EDPS. in of be the given now announced

vendors is customers involved traditional extensive this that complexities is submission, here, I has found understand much drive think to RAPS file at EDPS look the what the continue than the more we the file. to because

lot Initiative you You more these adhere CPT the to to data need and a submission, Coding for including more National have standards. codes, Correct

who've to well really And payers of think claims the revenue optimize payers for question on any for of I circumstances. reliant data appropriately ahead is understanding -- so business increased. and continue this, as complexity the not encounter how been but the of link the and accuracy curve earned coding on that and are reasons not that's appreciative beginning particularly to particularly use in people to that upfront, the we AI And beginning, has do because one of your be our by

a and to and in example think underlying curve to AI of I extensive. always our mechanisms appreciated as of it's have more other that's frankly, So why, models more complicated ahead in areas and make we sure the complexity invest serve in their we good needs order not customers get these the

of Truist Our line Sandy with the next Securities. question from Draper comes

in materiality I say contribution the you just a it, Fredrik, First the is acquisitions. hear but revenue didn't to question, these on deals? there

material. so, assume Nucleus little the revenue would bit next They're over nothing and Nucleus we of of a PROMETHEUS, that that material Obviously, of as impact revenue drag there's really Probably impact in to continue significant. real beyond the longer on nothing any eRx investments. terms But no term, much in. or the But be. major. terms I that, and short PDX, But there PROMETHEUS, say, term. well and a In baked expect really make EBITDA there's aware months really you're in we I isn't of terms to of of XX those. impact it fully we

Yes.

investing the some of shows a continued period be in the Imaging, they as for of because time. of underpinning very that think care gives I waterfront customers about really it I of over our it it what us And wins, is I confident or capabilities. whether way for think new world-class IP, that on Enterprise terms our in to think the is kind we does covered value-based offerings our can described platforms, unique think we've

rolling How products? question sort out of And new And do to hard you this? things Change assess your I'm I new getting both What's are approach rank products. all are or fully Thanks. up related you digest this? all ability up just where from how to and sales more product? product lot part I'm they these the more these I'm as train sales And and all really sell imagining salesperson. would more I guess, all to acquisitions, news the of they force's sense sales people trained sort a you be, rolling take in gosh, out I how a of that the with is mean you're understand bring it do force? how How being of to does them? getting good keep understanding speed a of would a terms the long the your

think and and the year we over planned on that our as that, discussed about or the efforts lot we sales We last two. growth a lot marketing of a sophistication and enterprise

our C-suite we've per the enterprise to for calls sales particularly, lot So more, much sales which that them for and recognize, of sales And just capability. your we've into comments, just-in-time a education the a consultative invested a switched, mechanism much in force. actually level, all, has first more

about still deep all deep we shouldn't expert expertise XX-mile to specific a various being product so in have somebody verticals, addition, our you necessarily think In in have lines.

many Obviously, per We have deep the expertise. moved happening then lot we We now. in not people this now about a nice conference like value year, with companies. a lines, can semiannual your who people talk that's point, mix multiple a of But do a used and proposition this to across virtual once between person. sales the year product overall to

say. describe. quickly team sales you yet organize the our in a be And And of of more skills we it's I engaging education to our mechanism execute, people let have indeed, effective, I'll that we're the as in customers. can development a the a and you the combination change to more just yes, really time, think so very then innovation in specific they we But pivoted the so virtual quite force, much way the much buckets doing sales way bringing to force, to the educate this

from question next The of with George the comes Instructions] Bank. [Operator Deutsche line Hill

flu [Max] question. to of the the about on well? there relates others? taking it the and as labs hospitals, it you It's offices, as volumes seeing comment vaccines relates George. volume for Can you're perspective Thanks tests, And versus for on you COVID-XX mix to a claims you're you. talk can as Thank doctors' from what seeing

first we see in particularly outpatient robust the of a So or response office. all, physician did

was of recognized, in obviously, a the period think, the lockdowns I there everyone spring has when bit ended. as catch-up,

seen healthcare as out we seeing level. would now utilization And system, at otherwise in the utilization the we a responded recovery to I see side. been slow equal inpatient environment. perspective, have And full certainly even We we're say as XX% from not a is was more physicians' that just the while pre-COVID, would think probably the I to continue, I it reported, in as course, has on of the levels that But described, to begin there. XX% rapid think

seen. I think what we've So, that's

In claims, and number company the senior in daily indeed seen in would been have executives increase reporting that we have and terms inpatient other cases that the that the expect, in COVID get claims of and reported. COVID I given you Fredrik admissions an of

a many trend I not But reported back we in the of the think to less lot with saw think again, the frankly what it's, adverse admitted to by spring. hopefully, events I been, because in being starting and treatment. people for it's dissimilar people, unfortunately, advances

we utilization, since underpinning continued we diversification our the the a in given the healthcare just it's that think But I that's of strong system. data obviously U.S. have well. we're seeing across as all our whole So dynamic serve business

And the Baird. next question Matthew comes from the of Gillmor line with

share a I within market. you was understand wins new You the all you're hoping that unpack we comment made could where about so and just gains a little success segment. network within that having

Matt. Absolutely,

market. So segments I'd break of innovation, first then and of accessing two new all, into buckets, basically the it

out pertain attachments terms in of as we know, offerings, So the to of to that number others a new ways we've provide. you introduced all more value including say innovation, get services of I'd and

year think helps clients, us Fredrik growers operating grow avenue of in in And the to think continued, and with us fast that has I would in terms call U.S. that's Then that healthcare. another the or has mentioned, this entrants including to investment, network been the of growth new CapEx by that the and continue innovation. been I'd either we've some do the as continued other customers, to appreciated point has revenue. network and continued grow I the area core I that under out investments Our that is accessing pandemic, of for

our those our again, marketing, And X,XXX but pointed but virtually ability customers, pre-pandemic that we've in businesses, is investments which in us very the advantage our business of over the access increase I health really online growing, sales API our new, all all the some digital in enterprise network versus pandemic, market. cases, a need. not our in growth marketplace order given investment for digital fast we're accessing that the of, our the of only to our particular, growth have to and because e-commerce, companies companies made, marketing, in We in the out real and are innovation, indicative connectivity

guidance. ability in free whether just difficulty in your to I was COVID. financial of the all at to through that because a wanted the free assumed with I you some had cash just flow one going on terms may are clients, obviously rates get from then the to guidance, collect clients think and also increase delayed collection update And point, an be factor cash flow cash that

the But originally, health what that were to that Act wasn't back going obviously we and really Act than the financial different where CARES truly stronger. -- is expected clear in hospitals So it's we and the helped, point. financially The see. what we yes, April, CARES are at is sure

anywhere year-over-year deteriorated not what has close collections So expected. we to

it's fact, now earnings to, beyond we why year. course, was flow of the addition more to it is feel pretty In part had last reason free of probably the in similar what originally. also cash expected the what we've with generation comfortable growth that And we that seen

million. $XXX led strength to about lot And that so it this that the And company $XXX million are we range. I in has that the says us of a to think

I XXX, think, like think were, I we that. something year, or XXX last

a it strong very our so and with our exciting well earnings be consistently, flow flow that free perspective we're And integration And because next from well is close year from we perspective, through CapEx be where I heading. next see million. year's to $XXX coming will a down, bodes we've cash And said for cash really it down. OpEx free year. will this think think as get pandemic. it's to above And And we getting

audio remarks. the back further no for questions. showing now are we that, conference closing hand With I'll

this for we pandemic, to and so Fredrik also and obviously, everyone, you, have to accelerating have of today. all our just as dialogue also very as the with on makes initiatives, thank we to continue it balanced well. appreciate investors really our and interest, diversified that you this the work Well, mentioning, company us in joining of continued but us even but productivity our the of continue to of hopefully demonstration, important was the strength innovation We the which invest customers, business, through attract all in customers, we behalf as and

you So thanks us for to joining of all today.

lines. and This does your thank you conclude today's disconnect conference please you participation call. We ask your for that