Omnicell (OMCL) 2 Nov 232023 Q3 Earnings call transcript

Good morning, and I'll be -- my name is Jordan, and I'll be your conference operator today. At this time, I'd like to welcome everyone to the Omnicell Third Quarter Earnings Call.

I'll be turning the call over to Kathleen Nemeth, Senior Vice President of Investor Relations.

As a reminder, this call will be recorded. Kathleen, the floor is yours.

operator. you, Thank welcome Results and Omnicell Quarter Third Good Call. to Financial Conference XXXX morning, the

On to me or Etta, call will savings uncertainties that financial CEO results and the projections with Financial contain and Chairman, Lipps, outlook to risks, Chief statements materially actions Founder; President, forward-looking Omnicell statements, and cause and related . This regarding Nchacha Officer. factors Executive including President differ are today plans, could Vice objectives, call are to strategy, expressed Omnicell's statements those or other goals, cost that other or expectations, from subject actual implied. Randall

For to SEC. the report in on a filed impact refer the that information the risks Form XX-K in with reports Omnicell the annual filed release description on and more in XXXX, of with March our X, the today other please these forward-looking SEC recent statements, press more detailed issued

not Please our any should be statements. update date reliance made by to on of the as speak hereof aware release not statements otherwise the any All the publicly or on do as any date assume forward-looking that forward-looking law, required to Except only or obligation specified statements you place call. revisions undue we today. forward-looking

are were section and results at Our released Investor this posted Relations ir.omnicell.com. the in morning of our website

during GAAP these these are difficult be we are estimate non-GAAP of not do forward-looking will With inherently financial uncertain unreasonable basis call, measures respect cannot financial measures of as our press measures, you provide items discuss this to we GAAP Reconciliations a to non-GAAP non-GAAP to and measures issued Additionally, without comparable the results that on we reconciliation effort. forward-looking measures predicted the remind to and a today. in like would non-GAAP measures. most included to release financial some comparable forward-looking

I call will over the Randall. Randall? that, With turn to

high-level today. through are for industry. performance our including seeing joining near-term I'll key thank our for Good and in Today, customer we for our quarter, and morning, you trends all wins the walk business us and the long-term and

We in will XXXX, for expect provide introduce as on XXXX. we an update our remainder our the of preliminary what well outlook thoughts as on

model with discipline our and advancing transform our the Throughout reflects the Omnicell Let believe on quarter to solid delivery we focus me performance which pharmacy continued results, continued we the from we and begin and third non-GAAP care of guidance XXXX, third financial globally. to deliver of exceeded medication strategy team. the and ranges. our We XXXX mission-critical high service non-GAAP customers quarter revenues, our EBITDA our product total for solutions end management target and for achieved ranges EPS

to non-GAAP approach $X.XX. $XXX of total generated prudent million, We primarily earnings and driven business. managing non-GAAP were EBITDA by the revenues We our per believe $XX million of results these share of

environment to care the we what currently the Now market seeing industry. turning are in and overall health

our which we the we wins, tech-enabled shortly, pleased services to with and by evidenced that Omnicell's market. As customer software are products, resonating appear be will detail

implementing when to new customers showing and IT caution already capital software stretched and However, may thinly face our turn, nursing to challenges in seem signs workflows projects. the new system be continue and of of timing impacting that potential health stress staff,

care. as are seeing through our subsequently it continue cycle, revenue we As XT to our upgrade in to and relates work we our bookings moderation of in point

remain strong quarter care we our of CPDS, achieved of our and point the makes up Advanced a Services revenue. on in While bullish still majority

to due for regulatory are also We systems our IVX requirements. headwinds seeing

remain our in interest customer IV robust. However, solutions

continue That believe is of part Omnicell the said, the we to for industry. solution

well expect positioned will incremental macroeconomic should be environment pressures Omnicell we hospital should market P&L the As capture alleviate to and improve, share.

ever. the to that more and than modernize important automate, continue optimize is need to we believe Additionally,

their achieve and technology industry are Omnicell. a Our innovative for help while And tailwind a customers solutions we become headwind, to challenges, long-term near-term believe today's will long-term our currently goals. designed

our an recent now from quarter, provide go-to-market on focus Media. on building update Omnicell first we called me MarkeTouch year. the let the acquisitions. continued Now executing of FDS Specialty Recept, to Throughout our third on the Amplicare our strategy, Pharmacy and momentum half Services,

We to continuum. with operations positioned we support progress we continue our to believe to the remain robust our date. are entire that pleased With pharmacy portfolio, uniquely across

we continue believe the choose to our landscape third quarter, Customers Turning and the the and customer management wins. role global modernizing in we're automating important to playing further and recent customer demonstrates medication infrastructure. Omnicell which

gain pharmacy our inventory and automate to robotics, comprehensive to market with expert services automating operations. pharmacy and pharmacy traction workflow and central of Services, solution, operations health dispensing efficiencies a wins benefit tools Beginning choosing to be services. several Customers the patient dispensing recognizing for advanced with continues through dispensing systems to safety optimization customer Advanced central central their encompassing appear

dispensing vision partner As you challenges the alleviate staffing efficiency. help autonomous selected clinical and and them Kentucky-based and safety of outcomes as in may effort have with a such an central been has announced our pharmacy service has patient pharmacy, to Baptist them closer move quality, in today, and fully industry that a we're financial leader seen, we Baptist that to vision. to improve Health embracing pleased Health to

to cross-selling existing momentum to appear upselling with communication be customers. we EnlivenHealth, solutions In and gaining

designed medication interest guides also reduce we digital will environmental and improve literacy, vaccine to We and solution. that waste. these guides are this sheets, that launched in believe and medication We information significant digitize medication adherence seeing are our customer

Georgia's systems health optimization to their replace quarter. in be delivering to is several conversion an the supply existing their health includes achieved inventory visibility Recognizing system optimization the Omnicell's value choose care a with reduce Florida-based and technology competitive networks of waste, this agreements, their inventory and XT medication to long-term of source stockouts improve that that in potential Omnicell plans footprint will largest to pharmacy effort as point-of-care shortages. X secure evidenced in pharmacy with chain, their This extending adding by health Omnicell continue service as sole Importantly, one partner a systems. designed solutions for to expirations, customers strategy

one beyond has been care setting. of service to walls of care the while X the health support revenue-generating and areas hospital, As important offering opportunity service of extend solutions pharmacy provide Omnicell's helping value Omnicell's the outpatient significant the appears focus this health specialty pharmacy for patient to should to expand our driving bring savings management outcomes. growing a be we area expertise care. to rapidly systems

seen drugs. certainly Hospital As share customers, a not in Omnicell's of saw that are results implementing of be the receiving of representative to services, and all such, its pharmacy may want our far, After serviced while providers specialty they XXX% President limited increase compelling. in distribution recently. event and Temple Abhinav access our live had University to X% growth think patient ILLUMINATE year-over-year. Hospital, some the XXX% That's University results at volume Temple Rastogi, We presented CEO we thus they patients

Omnicell has strong customer relationships.

a that term, challenging strong have expected We face That implementing our long-term are to position we conditions. is initiatives in industry and look growth. the and market, business team continue said, drive many across near ahead macroeconomic to dynamics we the as

our are our To revenue to bring taking near-term we with and containment spending on the continue initiatives expectations, in our discretionary structure steps take expected across X% functions. managing This same to time, reduce At business. are in focusing majority building are underway to result We on expense closely business head of count and within will line cost already reducing a costs. approximately in reduction company's is the workforce. we the our

potential with challenges optimize the continue and agenda, we is that biggest our pharmacy. advance in The pharmacy for solving opportunities traction to XT specialty focused on large which pharmacy designed our to about within robotic We To good our that and our ability dispensing end, excited installed expansion systems. innovation to you're base central care delivery. will our new are offer seeing services solutions of services are

that deep strong to emphasize And that has a with pharmacy our profitable relationships team fundamentally and customer and care globally. designed I brand the the model architect transform customer is want delivery Omnicell believe company care strategy worked is is positioned the uniquely we to hard pharmacy transform to delivery model. loyalty. to

are for is As that we of next into long-term we future. our confident the and positioned remain Omnicell believe opportunities compelling, our move well the phase evolution, we

call turn quarter to over organization Omnicell first the we work as done I'll drive has with across an business. and Nchacha, who the full us excellent just to our efficiencies financial completed his operational at that, With leading Nchacha? job

Thanks, here Randall, being today. and you for thank all

the Omnicell Chief Financial Let me who pharmacy deliver They passionate who incredibly team X as our are to start made about smooth over transforming transition the fully on Officer by to appreciation committed of my the past have into model. long-term are role professionals talented and care as to deep my delivery possible strategy months. of expressing working the a team

building team We on of track our on profitability, strong deliver have to remains and a record history stockholders. long for our our laser-focused

I to can how how existing to how we advancing and role months, refine regarding deeper ins the our of in we the And we a planning a amount financials my committed more thought and bringing forecasting. own are of settled manage in processes. learn stakeholders my considerable few numerous spent other to the I'm now business. I speaking taken have out and look at customers business, our perspective teams, our I have certain of about given with Having and global our time a strengthen while and lot further think fresh I last key have processes.

which the I discuss be I'll on to financial would quarter high quarter. in an an XXXX, year our early the Today, XXXX begin with because we for of our and demand will initial XXXX our our I of environment, fourth overview the and third also financial provide performance, full level are stages third current results outlook. perspective will and qualitative quarter planning. like

top XX% constraints. GAAP quarter the of within and a range, system guidance execution million, as budget XXXX were total third care the to health strong reflecting capital the quarter quarter. of point near care XXXX, revenues revenues the quarter previously the revenues, compared ongoing result third reflecting in of end of $XXX labor primarily lower down were provided Our Total

third X% actions. an by the Services revenue primarily in installed in growth increase were base, versus customer well our Services, the of $XXX XXXX, Advanced million, driven impact growth of pricing as quarter continued as of

in gross customers. the as Advanced a scale third XX.X%, of XXXX investment was services Services investments in prior due we margin our the our primarily services quarter, from make to to technical solutions continued basis for quarter points the support decrease Non-GAAP and XXX

experts of to and hire implementation. Advanced are Services, of required pharmacy our some For technicians well in advance we

A full on website. reconciliation earnings our Relations results included release, which of Investor our GAAP XXXX in quarter press are our third to is non-GAAP posted

with share third quarter $X.XX, GAAP and the prior in share earnings per $X.XX quarter were third $X.XX in per Our of in XXXX. to XXXX the quarter share accordance compared per

was $X.XX, share in share to $X share in per quarter per earnings third compared $X.XX same Our quarter and XXXX period non-GAAP the the prior per year. last

in Our previous $XX compared XXXX of million the non-GAAP reflecting a investments was EBITDA generally quarter, million, continued third services. quarter decrease $X to

third and strong share Our XXXX quarter non-GAAP non-GAAP range exceeded the substantially per guidance cost due management. to a EBITDA earnings

million, cash quarter. and the our XXXX, of XXXX, million the of balance cash XX, as strong quarter free was cash $XXX end flow June At collections million third $XXX $XX the from reflecting up within

refinancing sheet approach. downsized revolving strong financial which and business the of lenders' oversubscribed, management balance confidence to indicates $XXX completed was recently We believe we million, disciplined in and facility, credit our our a which our model,

company, potential XXXX and In We minimize to senior convertible are are meantime, believe upcoming options mindful considering of maintain our our various of very our notes confident are remain which our interest shareholders. the we and the a support we for flexibility have senior strategic attempt in our growth dilution to coupon maturity to convertible for current the notes, strategy. we and ongoing good ability X.XX% with capital In execution rate. our of in structure position short, a the

XXXX Our decrease December outstanding as collections. from XXXX. decrease day $XXX September was of quarter, third the of Inventories over sales million million, prior the days, a accounts reflecting for continued of XX, a $XX X of of receivable quarter cash days strong XX, were XX XXXX,

year. the team great global progress chain in levels Our supply inventory has managing throughout made

XXXX flow cash cash strong was quarter million, $XX collections. third the during driven Free of by

full to XXXX quarter moving and our year on Now guidance. fourth

project required our caution This As already some Randall affected training new workflows as to well continue and and could which customer software cautious of mentioned, stress of more IT the customers stretched and we new to nursing implement capital as thinly be the has contracting they see staff. timing our consider as change implementations.

Additionally, upgrade of cabinets we in of on we were currently sales based seeing moderation where cycle. the are XT our XT

As $XXX a changes, for these range million. now year the between to million result $XXX of we XXXX and bookings expect full

our is performance managing what with prudent pleased approach through of strong While business. our year, we the a quarters believe we the taking to are first X we are

range billion million provided and second XXXX expect to revenues our decrease revenues We Connected expected full a earnings the $XXX product levels $X.XXX between originally to year Devices lower full billion, on We we the now total now in year quarter. XXXX our $XXX XXXX expect call. revenues to reflecting between million, planned guidance the than of to fourth $X.XXX range quarter

million the lower bottom well on our provided ranges, within continue to bookings revenue of of to Advanced now guidance XXXX increase execute call. XXXX second guidance million, $XXX million and product the Services Services. an $XX and range Despite both we Technical quarter Services We range to the between $XXX the and expect of earnings revenue end compared

XX% million to a increase approximately of XX% $XXX between be to XXXX revenue total is and This XXXX, the million. Services Advanced expect revenues. compared at $XXX midpoint We and

We revenue the the million of an $XXX XXXX. our between $XXX compared This expect published year to earnings for refer release Relations quarter guidance Investor total as revenue a at summary in of XXXX Please our range X% components. is on third Services XXXX and website million to XXXX. midpoint Technical increase to

non-GAAP XXXX our decrease million to on XXXX year between $XXX total the provided a and guidance quarter million, call. expect earnings range EBITDA We second $XXX from

between non-GAAP the year and We guidance. from to earnings full XXXX compared for earnings the $X.XX the be for reflects expected on non-GAAP a range the The reduction $X.XX second year. per XXXX to profit XXXX non-GAAP share, our expect provided previously the lower revenue EBITDA and from call provided decrease decrease earnings our in guidance share quarter we range per of product the

quarter to operating year-over-year. speak We I'll continue down savings. to future fourth to a moment charges expect about non-GAAP expenses expect the associated anticipated actions also evaluate our the cost in take we structure and additional be and and in

an year non-GAAP earnings our are full we per tax of rate XXXX, the For blended share. assuming in XX% effective approximately

we XXXX, the following of guidance. quarter fourth the For are providing

expect revenues the fourth million. to and range quarter $XXX We XXXX $XXX between million

million and expect We $XXX between million Services and range and product between million. $XXX $XXX range to revenues to $XXX million, revenue

fourth share fourth $X expect We between million. And EBITDA XXXX and we range quarter non-GAAP $XX per $X.XX. million non-GAAP range expect to $X.XX between to XXXX quarter and earnings

As reduction company. Randall cost-containment also a across our we to business or head mentioned, count actions we plan today disclosed take, including

cost and We of $XX million to charges are containment taking. expect related we approximately plan million $XX restructuring nonrecurring to the

majority of We substantially and the second plan of expect incur a in changes local of to fourth subject consultation the quarter the of to XXXX completed and by law requirements. end XXXX, the quarter

be compensation increases also million the vendor expenses. the and the in of by XX% beginning of with partially cost a year. through savings We as expected XXXX cost of the smaller savings portion the to quarter The realized in actions offset anticipated actions be year-over-year progress $XX be is we increases. cost should first which of of expect result to a cost around expected price from as million annualized operating majority benefits is actions, to the A $XX

will speak about I briefly Now XXXX.

to We we want it we know too what early expectation help believe into some insight with metrics, giving is some to financial you provide share considerations based While our that specific may on you your models. today.

on expect bookings XXXX. reduced XXXX that our will our outlook have impact an revenues in We for

growth, solid offset it our revenue. to in modestly. the of to for is to are continue Advanced be revenues point-of-care Services deliver expect Therefore, expected in portions our XXXX enough total XXXX to expected While we portfolio not decline decline

of outlook our in provide to full first plan quarter XXXX. we the course, XXXX Of

our line XXXX. of effort working is cost we in As actions be today, an the offset we hope line to in additional anticipated manage to headwinds top to in closely the expectations expenses with macroeconomic containment continuation clear are from announced

our As to I noted with high-level assist intended earlier, the these are of XXXX remarks preliminary modeling financial business.

summary, against execute growth solid we to financial operational macroeconomic a our and and despite environment. In declining deliver results continue strategy long-term

impact the headwinds challenges. and customers, we XXXX. for our these challenges are into seeing expect to continue the We macroeconomic environment including And of labor

We bookings moderate. to expect continue our cabinets also for XT to

to business we has confident the from in a delivery deliver The model. position we pharmacy we the approach on foundation over momentum term. that Omnicell said, the built should team taking which are commitments our are expect continue transforming to long managing the That our to care strong

clear believe long-term on at Omnicell. work and profitable direction our are Omnicell, we We the to we we as opportunities endeavor and we for strategic growth drive for execute get on us and capture the focused to as well success equipped to on to we are driving We look shareholders remain ahead of value see strategy there. our

open to With would like that, call the questions. we for

first question from Berenshteyn Stan Wells Fargo. Your Instructions] the [Operator of line from comes

I appreciate XXXX. the color on

cost But to areas focus maybe on be you actions, containment can you thinking organization. about going cuts? you First, when these to on particular across said cost any plan detail it's

Stan, thanks for the question.

taking So we're we will primarily, where we where look at more inefficiencies, company. see our where looking growth believe areas are not There others. our than costs we But company. will think some areas at we're they're enabling because costs some taken in looking specific across out taking within we are at cost entire areas out the the there functions

areas Services we're Advanced takeout. one example, of the where for of amount cost limiting So the is

helpful. maybe Services Services, what us can or are growth with you Advanced sticking Advanced And share that services products with in contributing Okay. specifically That's to under segment?

our be but in services to solutions continues growth some company. engine also space, services retail that We're the robust the in services. of we're growth specialty and as specialty providing for as seeing a The some not

guidance your final then guidance. And can of us question, with you on the Any share maybe percentage is one product-related chance of bookings the Okay. bookings? mix what

Yes.

to about the I -- the majority close would the XX% mix. say related to of is So

is XX% product bookings? sorry, I'm

No.

you repeat can the Sorry, question?

million, that bookings. for of percentage million to this is that $XXX $XXX So you're bookings guiding year, what the bookings product-related

We year. do that. don't a do -- the at disclose end of summation probably We the

from look But So you I the could the would in say care. kind point of that bookings have our of at K of headwinds year. on the best been inpatient our last do is most

comes from next from Your question KeyBanc. Schoenhaus line Scott of the

side. these I Is both of to they should and make wanted of shortages the your levels macro. staffing First execute on conversations hospital talk staffing have hospital seems a regards the up, What these level? the orders? on are It and systems? mix to care once budget point constraints conversations about it, demand it's to in with like their these forward they get at able enough the current environment is -- to be to you capital What

Yes.

the providers equation, have Their haven't think flat, I much. right? are tough gone payer the revenues up contracts fairly

help So little will a potentially year, that bit. next

labor have But risen, and have volume. so costs the

inpatient headwind So of big particularly they're actually a the on these in is doing is where lot better. most Outpatients, providers.

of And and is the primarily so used systems point-of-care in where have headwind. the course, inpatient strongest world, we that's

need due to inpatient customers overall squeezed So And to of upgrade, have of headwind, the ourselves, the the our macroeconomic significantly. but XT inflationary resistance and we're cost. stabilized improved of the the there to this general there's increase upgrade costs, on improved because lot the slightly, half of second but margins were revenue, upgrade, cycle. just in not a slightly, they that and we, has flatness And

and the of closures big pharmacy there staffing my headwind headlines next a lot seeing then all staffing Is What challenges question this chains. is side. And from across your Okay. well. regarding retail store as EnlivenHealth? pharmacy obviously There's shortages retail been you been the There's to a customers? follow-up are on

but an headwind, a also it's opportunity. Well, it's

that less to set, take if solution med could headwind. of demand that to off fewer really at management, pharmacy medication to But of communication and workload sometimes look allow sychronization be takes to services eliminates it pharmacists, allows for them And consolidated. also the to drive transactions visits the calls. a you Some as perceived pharmacies more be our more

that also a So is big lift.

medication And also for patients. the big can we we're pharmacists, administer with give is our time saver out, cards, to out a now also and digital easier which that about give excited we notices

look of So it's the believe prevent throughput. their pharmacy services, revenue, bit they mix. but these I services I is more new which of helping more think do at The starting what little a as achieve up a lower headwinds want, people most cost, sometimes

Tassan line the Your comes next question Sandler. Jes of Piper from from

And the I thank just you with commentary. also to start Randall. want for XXXX

regulatory additional the some mentioned IVX ]. requirements you think I on [

this that was understanding in was 'XX. Our device approved FDA March

IVX appreciate [ any on would hurdles on resolution? and comments time then additional line just the So regulatory ] to

Yes.

pharmacy they have will complex site national, or they also state or allow a boards robot situation it's have put the to rules which won't mixed those what you is FDA, their not compounded because think each local allow. and I FDA be spin you of only interpretation what or on to the in have with that

which clarified, them to done And those each rules get of and want calculations so with fast rollout of they confidence as accurately be progress the gives then can how the ROI robots. the more installation, for

do clear, as And what it So can can't regulations some states forward decisions these aren't. just lot do. and are and in are, of some they about kinds of a people takes they conservative they what course, because time move

enthusiastic the we're very about But robot.

make continue to progress. We

We think doing next pretty have soon here. I -- just our install we're

So we're compounding, allow which have a we us of lot broader-based getting increase feature more as start types do sets, ROI. enthusiasm the to to to more

the in where like, starting we'd growing. not think progress. exactly definitely make enthusiasm we're the but I to We're So is pipeline

follow-up That's hoping That think helpful. to get on really is our And I sense. just an update XXXB. makes then

through guided the environment market can XXXX billing solution? us flat $XX the think just tailwinds split headwinds, about year-over-year. on to I and you at again, go-forward kind But expectations, walk XXXB, revenue was year-to-date of million of

Yes. the specialty Well, approach we providers question. big thanks actually, now XXXB the XXXB the XXXB, or with for third-party pharmacy option. solution internal And

then or pharmacy us easily drugs for go, up specialty those site, either through single XXXB, you that party most there. processed a And run have internal spin process. through processed or you if still XXXB that you don't, right? as for let both third don't can will, be options, can a a an are those So You say, we contracted why

double-digit the opportunity, specialty of spin-up driving industry So it's area, an in And that's itself that's because or growth strong And limited been these why not us. XXXB has things. pharmacy the see the just restricted. we

in don't in does we that the see the to significantly industry the but there. grow have or house lot growth we of a of XXXB, services internal the side the more actually opportunity uplift So see it for the give you of

it's a just party, the obtain to external way the there. than third different seeing that's internal through So is rebates, pharmacy an we're why and the growth

comes question BTIG. line next Your the Larsen from David from of

Can think about then second you through get the upgrade never be technology XT would created there process around version that or of of the a new entirely whole half this bit you that know I talk process, that once Is little since sits would And you that, be cabinets of said more not? the XT correct would sort you're still. detail on I any but great. an

to expansion. second conversions, continue on during Thanks We're competitive down not have the to continue delivering of out environment, question, absolutely Yes. point-of-care willing to that. and just resources We right? not focused to or excited get the the also for but extra that slowed we're little the of It's the do XT bit really a But we hospitals large it about business this takes as market those, with portion Dave. swap although still area, upgrades, half right? a

the footprint over time, last really has our market years, of It's care grown of over tremendously, point few So large. right? the

cycle, an significant of for the be upgrade generation quite in obviously, the will company. So next

to upgrade from just side. don't the a product technology we But want

out and point-of-care and to out drive continue already are systems will the rolled to investing services outcomes. We roll around

part we This is is that really exciting. the think

for continue to that growth that deliver want story services all and We Just in stuck not we're allow of services outcomes the ROIs product cycles, in see have cycles so these more. product care, to like that the the excite also specialty make to have that same there. the simply and but really just point

extremely as new And and on positioned point products, Advanced large, to forward Services. so we and market that We absolutely any we very monetize see is market And and those strategy. really but don't that a well move of create with you're do certainly the is we're whole right. care pre-announcements optimize go-to-market the

you Can salesforce.com, one your each a And CRM, bookings, of setting guidance, of quick salespeople bit of you of you one. visibility the where they're that deals drives on, how little process of Okay. the just maintain how provide like do actually estimating some your guidance? a can more close, the about then close, your color just collect your like talk working into provide you your data terms and odds the rates, to in process timing

customers do manage sales year. the Our on a our are go quarterly they forecasting engaging through team, of And robust -- they to our our approach that throughout very for bookings very have we process They this we stringent a very that we with a as ensure basis. forecast we see bookings the year.

our as some we how booking. and upgrade we how we see additional will And improvements we forward. of forecast go we to and specifically and revise continue So forecast changes

from line from question Craig-Hallum. Your next comes the Matt Hewitt of

they spoken funds? services of to will CMS on to to some is buy million be when $X payment for looking receive This Matt. funds? expecting are and the equipment receiving And hospitals. the you they those Jack at When those customers Have that

I haven't got any that. update on

there call before In this thought just happen about kind fact, we what checked and crickets. we would on of it's

So about certainly insight. spending year last to was some the hopefully, for soon think I at on sure. impact had because beginning our we'll around the And supposed it that -- hear will hospital way more some of be it

as least a a mean press at little challenging your start well. and fiscal follow-up. heading to said that spoke better restructuring bit we anticipated top be to the release, In you And a of line take will to 'XX into align with then fiscal Should 'XX.

an XXXX, on We further reduced revenue. we expect our our for impact bookings have which will outlook

expect in our is deliver offset point expected we decline be certain revenue. portfolio While to enough in Services XXXX the portions solid care it continued Advanced growth, to not of of to the

in revenues XXXX decline modestly. total So are to expected

Of in course, the plan, and next first a we're still working year. we'll of better on our quarter provide XXXX outlook

next line question the comes Sutherland Company. from [Operator Bill Benchmark Instructions] of Your from The

whether far the matter funnel, sales is that as or the anything timing of shape impacted the curious is of than more a bookings? else kind this as I'm of just being

low question. been of a these think that the they the I there. yet, want Look, though and spend hospital because pipeline systems they and of some good to have in capital is out still a Most deferred to need Yes, it's lot have care. getting line pipeline. negative for these upgrade. funnel are the is particularly these by -- don't customers product on margin the point-of-care They to that they're there the they're in of date inpatient dollars of the even But

the pipeline They are So gone hasn't upgrade. eventually to going awry.

just gives on time deals. it more us pressure So opportunity close these them finally to more and puts

So typically the the then just to sign the the or CEO, approvals deferrals pipeline. all the or are next they inside had off that the next system, and And on to quarter CFO piece, except last the off literally, these year. in maybe gets then pushed

your So the some to the some the just you Or you kind next... -- cycle there look past ahead play XT might think of for out providers to be the do of might expect of level like ones?

bit probably right? little I of on the I shape think bit pandemic the the up adoption. the curve a the curve think XT a sped little different, certainly, is

XXXX, being sort it in of instead certainly, bit. a up several was out more years, over of it smoothed sped so And little

helps a of now to it's what curve, trying adoption second people and bit. shape as the think coming at get I half a I we as expect, there. run of and the little understand of -- is deferring pandemic we out that of coming the of innovation 'XX. look curve is into the -- at is towards XT what we And put -- defer cycles certainly, timing back into wrinkle we But and, that curve the think our development in when So the I they're the sort think, us that kind back are kind particularly

forward. And if capital just curious then allocation thoughts your last on one, just latest going

go-to-market driving largely Yes, and recent strategy focus positive we free continue with on the acquisition to completed, flow. and integration cash our

for our our fit to continue also into We monitor strategy. opportunities overall which markets any

capital invest allocation strategy. we growth dollars we areas to continue continue based And seen will portfolio view opportunities. a our And on to so whole robust we will have annual reassess in that

over at I Randall? There will call time. remarks. turn of Lipps Randall are Omnicell, questions no CEO closing the now for to further this

Well, today. thanks us for joining

as through bring headwinds, excited there, footprint the capital, market and point-of-care have. get will that And not particularly services, through we really just this this an large us to which help particularly this go inpatient innovate market, advantage of we we as on accentuate economic about will but as new we we product we're take As this. in

there that we this deliver focused achieve. the to strong large want earnings, us revenue we're also getting us there a profitability. We return to a position for going is very get We opportunity for which need to -- company be and to can opportunity so on is the for I growth strong building big to company back growth, think that

future together to businesses potentials got on in the We've exciting customers, lot for patients, a of adopted, and hope near for for employees very new IV, for growing to the great like are Advanced well deliver and our and that our well, our with bring shareholders. that Services our being we businesses,

are we profitable now. course, Of

you saying And today. Kathleen. Thank are of profitable that, for course, we

to thank for forward. us without hard working Well, us as who we for successful you. continues move end joining you right. today, all labor help All be thank you Thank and to Omnicell team the

Thanks, everyone.

conference This concludes today's call.

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