Omnicell (OMCL) 8 Feb 242023 Q4 Earnings call transcript

Good morning, and welcome to the Omnicell Fourth Quarter and Full Year 2023 Financial Results Call. Please note that today's call is being recorded. [Operator Instructions] I will now turn the call over to Kathleen Nemeth, Senior Vice President, Investor Relations.

You may begin your conference.

Good morning, and welcome to the Omnicell Fourth Quarter and Full Year 2023 Financial Results Conference Call.

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

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

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

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

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

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

customer wins. I XXXX, walk full QX the Nchacha the and and demand outlook. on our morning, key thank an year provide and including fourth high-level fiscal quarter Today, also through all us. XXXX for update joining our some you current will and Good for performance environment will

Beginning guidance financial in as XXXX overall with roughly the provided original with February our results, in XXXX. we line delivered we results

However, bookings XXXX missed for guidance. and our original prior XX% full the year year down were for

the the GAAP million, year. fourth share per a our guidance the versus the a share was Total revenues loss total to for fourth versus above For XX% million prior fourth the due quarter, earnings $X.XX GAAP from $XXX EBITDA was $X.XX down management per year. were million strong non-GAAP for $XX of of prior $XX expense quarter for loss quarter year. prior

me be let clear, as our Now view not acceptable. performance we recent do

to our performance, Although taken intend action. improve to we take various have actions further we

years, For scale. and with launched a to example, over gaining we the beginning past advanced are customers number traction that services few of

We also costs, of These announced heightened previously X% by XXXX. the are an approximate of million workforce on basis announced $XX cost reduction including managing focus in last end our expected quarter. already on result a annualized in to an savings actions announced

more recognize we we have do. But to

a optimize consultant review an the a effort for of decided Accordingly, thoughtful and of holistic improve we potentially operations other undertake in how initiatives operations assistance to of tell our can best have business determine make we the evaluation to changes go-to-market outside to with there an need portfolio. investments. our our us we results and a to where Our is can from

evolve and performance ability shareholders. improve as to been our to core we to safely the company has demonstrated continue repeatedly efficiently health systems' business across a deliver our years, point-of-care intend strength the continuum Omnicell's to returns medication care. our manage remains Now of and critical and We over believe to to

with moving urgency. this with are determination and forward work We

of vision care pharmacy the the industry autonomous the We will transform to continue model pharmacy. delivery advance and

the we deliver committed to to [Technical mission. we you to I look are on work as forward achieve updating this returns However, shareholders for progress. strong we ensuring Difficulty]

the conference to Pardon a Yes. interruption, continue. we the moment allow for are Please technical experiencing difficulty. a

operator. please? recording, Will you continue you, Thank the

industry-wide projects seem turn, to move as budgets we will increase signs hospital systems start persist encouraging with impacting XXXX health delayed seeing for that of Industry we forward and forecast predicting year-over-year. Difficulty] in [Technical health moving long systems But stabilization. in indicates headwinds research XXXX. some are XXXX, XXXX. that capital could into In CapEx some

challenges across what cautious costs. take and our the persist a operating we labor approach believe costs industry, is to may including managing continuing believe will therefore, we to business. However, . And continue high we

part that capture cost incremental continue macroeconomic improves. hospital to are believe the market We we positioned for solution We pressures to of Omnicell as the essential environment and uniquely alleviate is industry. share the think an

As and profit lower EBITDA decline non-GAAP expect I mentioned, bookings year-over-year our to challenges for XXXX. create and XXXX, revenue we from

of has automation, the intelligence that to believe However, the are services, for technology-enabled model as to delivery we customers solutions work and combination pharmacy transform able deliver a to through large. we than over installed are care ever. we share important successfully management market for market addressable more base gains The the X previous of our Omnicell increased point-of-care medication years. total remains connected devices

and service enthusiastic and the installed within opportunities base. very are deliver encouraged We enhancements by about to the XT product

our efficiency console data December. a strategy in experience toward improve at solution nursing upgrade, The XT upgrade refresh. the and and We midyear XT is user and cabinets designed which of a enhance XT is network meeting security showcased broader to console for XT ASHP part overall product and this planned XXXX recently launched

to key to begin enhancements and This initiative outcomes. our We platform products are management innovation investing pipeline product year, to is anticipated medication designed in and the to provide to improve the services bring multiyear XT related XT key provides platform services management. to a medication drive that

outcomes safety XT and for patient efficiencies. products health Our to focused delivering systems asking of are on fleet related are and us

see beginning signs stabilization our strong are point As within in mentioned, is of believe to I the pipeline we and XXXX. care, we innovation very of

amplify very what are they purchased. We these customers already have because excited our about will initiatives

turning allow by agreements. footprint sole-source facility should to value dispensing X solution, medication has our technology by cells to recently, Appalachian packagers, advocate and the to along cabinet Pharmacy sole-source some Omnicell Health's This with locations multiple XRX anchored XT member Ballad this focus customer with Illinois-based as and pharmacy and a January, which wins Tanner, dispensing the important we Hospitals health system the includes their tasks. long-term new been to Health of during Omnicell pleased distribution which Ballad in Automation position an systems Most multiyear pharmacy consolidated participate Chief help which Highlands central in as solutions to of Care robots, with continue Ballad optimize help Omnicell automated Omnicell's for X which expanded distribution quarter. collaboration strategy includes expansion. long health opening Standardizing automated VP will on to Pharmacy across across for a to support This agreement center, grand multiyear system Health intended Officer Now new of for technology-driven find Trish region. Board. system. convert care dispensing well Tennessee-based has are inventory an staff higher-value Advisory Pharmacy were in Ballad management the is the future Health evidenced

We matters. professionals it's of just course, our to advancing commented, can it's with what the leading patient more truly agree our of that, well-being and the to to more operations vision event, is patients. our embracing proud effort are And industry enable could time pharmacy. future get autonomous to streamlining sentiment not the closer this to care, about be customers vote and the technology, not the of achieving she health During where

continue developing driving leader recent in to a health software creating with Board We significant experience the to election businesses. the industries a Eileen operational excellence technology enhance our all for respected accelerating and take of corporate governance shareholders, and [indiscernible] with value steps of care with global widely to track Eileen is record growth, Directors. the

We are to her thrilled Eileen. join the Board. Welcome, have

be let Now me clear.

believe the better in we strengthen our accelerate are to We and necessary growth, company uniquely delivery work Omnicell's taking transform help and continue of to customers financial increase have the ROE. We to opportunities are confident long-term remain but shareholder enable is our us, pharmacy outcomes that hard model ultimately steps and their believe positioned achieve drive the to and performance, value. profitable ahead we

Now over for that, it you more Nchacha, Nchacha? I to will turn quarter. details with on the

today. for you Thank being here all

our financial year outlook. discuss performance, demand our QX XXXX will full and environment year full current the We XXXX and

last and have refine X look our business setting lot we the of a can at how thought given hard and process. a we and strategy Over to along quarters, products, our strengthen go-to-market have with taken

engage and from decided comprehensive to product and to As and of understand ways opportunities opportunities looking view further at Randall the to mentioned, a everything we and in financial in we consultant front performance, . in a undertake have improvements our us portfolio. refinements of to operational assist can business strengthen our enhancements good productivity our better

XXXX, to you including to and also During our We we progress. additional we consider may be able and financial intend information backlog. bookings metrics to our report, share performance new provide reevaluate forward to an we we potential and to metrics And on will key look updating in the stockholders. effort transparency

get for as XXXX me as and into well results fourth let that, outlook the year full for With our XXXX. quarter

the million, XXXX, care and growth growth quarter lower that the primarily were of pricing XXXX slightly labor as a the our call. reflecting services XXXX, above during revenue as primarily result execution, the result XXXX, were revenues a $XXX technical point fourth strong revenues, $XXX of care increase we the driven XX% of of in the midpoint revenues actions. base ongoing capital million, installed the to quarter in of and versus constraints. were fourth compared XX% budget fourth down guidance quarter by quarter systems total GAAP decisive in third of Total health earnings Services an For provided quarter

XXXX, mix the XXXX lower services while modestly. A the and XX.X%, fourth which revenue decreased is the reconciliation are margin XXXX press points non-GAAP full impact was earnings primarily in based Investor included fourth results are Non-GAAP release, decrease quarter. our XXXX on to non-GAAP third quarter for gross on within prior website. expanded gross of the Compared quarter. and our to gross third product margin the posted from of quarter decrease points, Relations The basis gross margin quarter margin of XXX GAAP our of XXX the of non-GAAP in quarter basis product a product

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

XXXX million of with our fourth per earnings savings associated quarter cost GAAP XXXX include expense severance-related Our share plan. $XX

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

million, a compared actions to impact of reflects $XX of was Our cost the partially quarter, the EBITDA quarter decrease $XX product fourth quarter, quarter. which fourth in XXXX revenue non-GAAP lower offset the savings previous million the in taken by

non-GAAP Our earnings to guidance provided third fourth EBITDA during share XXXX our strong per across cost organization. exceeded quarter range quarter management non-GAAP we and earnings due call our the

lower-than-expected the services, than which of the our and results. were in billion February original XXXX full driven XX% full CPDS includes advanced our XXXX by our guidance, billion to review original year $X.X $X compared services, of to million, lower year tech-enabled full particularly full now and a orders XXXX, year year year bookings guidance $X.XX quarter. decrease Turning to $XXX XXXX prior from Bookings IBCS. XXXX provided primarily for XXXX for were full billion for

our XT Additionally, bookings to a as system delay of bookings, a upgrade than customers including and budget capital result were continue to decisions as our original XT health result cabinet point-of-care of continue moderate cycle. care timing in cabinets, lower XT expectations

of majority IBCS the for lower the was result and and lower-than-expected other services. in a summarize, To CPDS of advanced bookings XXXX demand

we $X.XXX the billion December XXXX, service. backlog XXXX, expect pharmacy to as short-term connected central Product of of $XXX revenue XX, includes XX, backlog automated systems convert as product is of dispensing dispensing to backlog, XXXX. compounding backlog and XX months. was to XT of Our total which million, within which December XX, Product product IV book as portion $XXX December series was million devices services as such compared $X.XXX our billion and of

a multiyear advanced of as minimum agreement. which backlog backlog XXXX commitment Product year Advanced bookings. service services within stated only of the Services $XXX decreased prior portion lower by million the have contracts, our over a the includes result

expected of is Advanced Services majority partner are when we XX, have with commitments. which $XX While our advanced the as only minimum to our XX million, services months. multiyear the $XXX is million customers backlog, which a backlog of December providing to convert of closely contracts, short-term within XXXX, of advanced was portion and revenue those provided services advanced contracts services on stated

XX% Advanced year. Services over million, the increased backlog prior $XXX up

GAAP or over XXXX bookings, full year decrease billion, the This in just a decrease Our lower from $X.XXX revenue of million year $XXX XXXX. revenues XX% of impact outlined. as prior I was reflects the

revenue XXXX Our revenues XXXX our and million. were product were $XXX services $XXX million,

revenue, revenues prior Within $XXX the the Services increased services Services were Services Technical revenue full and year million, $XXX XXXX were Advanced year. million. XXXX over Advanced XX% revenue

Our earnings year XXXX share of share. with a full GAAP accordance per per in loss $X.XX were

Our a share from XXXX decrease were non-GAAP XXXX. share full $X.XX year share, earnings per per of $X.XX per

during year-over-year For is we the delivered million, was cost we announced $XXX cost and non-GAAP in partially we third November share and the XXXX, in $XX The XXXX earnings XXXX. XXXX from the year the range revenues November provided a XXXX, actions, in plans decrease of guidance which savings year, benefit of including full million lower mostly of EBITDA the from driven by by offset XXXX. savings decrease quarter above per revised EBITDA

Although cost year bookings are our the than XXXX. the we that pleased in of plan and original full savings XXXX, when we the revenues provided announced with expected guidance were we February November in XXXX results lower

savings with and and non-GAAP non-GAAP above Together ongoing original initiatives cost XXXX throughout guidance. EPS other EBITDA and EPS the be of cost guidance including the to year, plan savings the the drove EBITDA implementation factors, implemented

further our there of streamline our as we from as profitability be We XXXX. XX, cash quarter identify September to and taking we believe during demonstrates to to million, believe million this actions of million was year to end continued fourth up profitability challenging actively product to $XXX during the this front. is balance the bolster designed costs. mentioned, opportunities commitment business However, our working favorable $XX work our At done And on I the are XXXX, $XXX customer period. of the more

cash to during for the the inventory non-GAAP free includes Our capital flow reflecting was year, compared the full $XXX accounts in million which reductions and of year XXXX prior $XX year, management. million benefit working strong receivable

notes the earnings which to for As strategy. potential we we the believe our XXXX convertible convertible we current in options communicated In an to execution we mindful our position short, a November considering for be senior and of interest our strategic confident XXXX our the our company maintain stockholders. have continue upcoming rates. majority in ability call, the dilution coupon and our X.XX% very effort capital we are and in ongoing of remain in flexibility minimize various In good meantime, are growth with our senior notes, structure support to to of

XXXX. December days a sales million of Inventories were XXXX of X X of a XX XXXX, accounts of the quarter December over $XX for terms days decrease reduction of XX, fourth receivable, XX, prior increase $XXX was from the XXXX. In day quarter days, quarter, and an compared million, the fourth to outstanding as

supply managing levels. team progress continues global chain inventory great Our to make

would Now seeing environment quarter XXXX care. the of to and We our full within we commenting start guidance. like current demand are moving point on by to first year

bookings product in We increase and innovations, offer including installed are XXXX. see the encouraged noted with base, We that XT in product in by to new console his enhancements upgrade should point-of-care opening modest new a these on the believe remarks. a runout we opportunities innovative larger

Our core franchise is strong.

a million. excited $XXX is durable by to Based and future our bookings range we of expect our are million these XXXX source to year opportunities, channel pipeline. Our expectations, innovation full $XXX on we between

to total We billion billion. revenues range XXXX between full expect to our year $X.XXX $X.XXX

million range We expect product $XXX million. to $XXX to between revenues

million. between expect range services $XXX revenue million and We $XXX to

advanced services revenues from $XXX $XXX million. services million range to and expect between We

from expect range million. million services also and $XXX We to services revenue $XXX between technical

year-over-year customers The revenue modest partially an our of expectation cycle. decline, the product advanced increase revenue a expected challenging to guidance implies guidance At a year timing reflects revenue life continued environment our in full for midpoint, system for revenue impact the health XT services of XXXX offset our compared XXXX. product by when and the

stable stream have health in and of with for services revenue advanced our customers. have partnerships the a we multiyear systems and our a shared we services, provide contractual recurring past, As majority retail

the to in release earnings advanced services published contribute revenue components. to orders, a continue the XXXX continue installed quarter Relations revenue summary of XXXX refer increase Please we to guidance base book As the fourth new to Investor will year on our growth. for website our full

million. $XX and non-GAAP year between full range $XXX XXXX We million expect EBITDA to

We earnings per expect non-GAAP to full and $X.XX per share. XXXX be share year between $X.XX

non-GAAP guidance expected by as XXXX [indiscernible] effective guidance. non-GAAP we our For the share the of year impact the per the a year-over-year year care offset the tax per of recently rate approximately XXXX, earnings benefit EBITDA point savings blended The in earnings result of full implemented assuming an includes of and full of share XX% are partially cost non-GAAP revenue, the margin lower gross full plan.

benefit of is We XXXX, realized to first announced $XX as of year. as a from cost A savings which the anticipated in we cost XX% progress actions of expenses. actions the expected the be XXXX, through the in of of a to quarter the to of the around be expect annualized continue November expected beginning majority savings result cost million portion the smaller with in approximately operating of is

gross inflation anticipated reminder, are the to to mix. cost a As product due as be partially well offset actions expected as lower by margin year-over-year

providing the following For the guidance. first are quarter XXXX, we

between million million and be $XXX with and first million, to and be revenue total to $XXX quarter $XXX and million, million. expect services between million $XXX be We to $XXX between revenues XXXX revenues $XXX product

earnings be breakeven and per between of earnings a we be XXXX a expect loss non-GAAP loss $X.XX quarter share $X to quarter share to between We XXXX per million EBITDA of share. and And first per expect million. first of non-GAAP $X

we our In execute summary, and strategy long-term a to macroeconomic environment. navigate continue growth against challenging

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

are delivery term. confident foundation continue to the we stockholders Omnicell work care deliver that focused We our us. over The strategy has for we the execute the pharmacy look transforming to position taking of capture actions are opportunities commitments a our the and on to are remain intended performance. which momentum model in our on long expect the see to on managing should However, we value approach from we driving we built strong business ahead improve taking to our team as our to and

endeavor to at to continue We profitable drive Omnicell. and success long-term growth

want like to would to our I by With employees thanking conclude hard commitment to call the for Omnicell. for work open the continued we questions. that, and

[Operator Instructions] with comes question Wells First Berenshteyn from Fargo. Stan

bookings Maybe on a guidance. the couple

decrease First, Nchacha, you product us if for what's XXXX? in I if heard in the increase can driving said is point-of-care case, you you overall . expected to bookings bookings that's help And correctly, the the year? guidance understand

question. for Thanks, Stan, the

as to be We and and software are customers IT implementing consider that projects. contracting and continuing may capital implementing staff, impact our [indiscernible] which see new stress timing of new the more workflows potentially they cautious

While on currently we of are we expecting a based moderation a still cycle. point-of-care our new [indiscernible] and where as result XT XT we modest improvement the are cabinet services, in sales demand of for innovations in solutions our of expect

IV However, complex for work continue robotics. regulatory in Services, to with Advanced we our customers environment navigate our to the

the trends IV long-term is Please interest favorable. of keep which and we a remain believe there services, lot however, that, quite is in in strong, mind

And go -- ahead. sorry,

our but excited within saying, XT just $XXX innovation to range million, $XXX bookings million the very platform. and the expect between again we our about of full be I'm we're year

Okay.

Are be for on . Advanced to for expected negative the services year? positive what or about bookings So Services? the advanced

complex environment see As earlier, to regulatory I robotics. we IV mentioned navigate our within our customers continue

Okay.

seeing increase that saying XT you're in sales so care point And is expected of demand, but are modest decline. to

expected net basis, our overall or a in negative clear, to to positive? be bookings, on just So product product our be XXXX bookings

Slightly positive.

Okay.

get to bookings overall guidance negative, has imply the right, to So that negative? would be services advanced

That's correct.

factors guidance of in the Okay. $XXX us wide, guidance it's I your are [indiscernible] . range? what you that. And appreciate terms Can through then just million. just range, walk pretty

and that this adoption fast for a guidance lift we -- we Yes. reasonable throughout that very us, what it's product the be we year think we -- can And year, achieve innovation and introduce can I is it this the the in a is we big year. uptake provide believe varied. We as new innovation customers our Right. on think for see is that's how by implemented and bookings why is and innovation

the first So attention, at well, big they innovate, And lot upgrade how to phase we'll these do every play we're just does get customer -- get year we have is of a have XT in cycle then revenue? those a can And we products now beginning will, cycle, of an and it the to XT and this which see of at the with as eventually, it's to beginning XT time this means the get quickly offering. . platform continue uptake. new is when the of the enough just new it pipeline it products how and that year in customer sold of

Your with JPMorgan. from Anne comes next Samuel question

I it Is you Or industry around Services broader those is demand? the business, out hiring parse challenges around it was pharmacy the issues something within Advanced technicians? maybe some the what hoping still in maybe backdrop are? of key can

IV, environment by the just It's state. our state. making a not federal, Well, regulatory of demand think lot it's I is way in just interest by is to

So have there. to to that, achieve get to you proper the steps take

looking are for a at is in from of deploy past. a consolidated service like And have really they the robotics. it are changing So a where it's CPDS, slightly strategies to Ballad? been there. in Or that's large And in biggest customers looking the dampener that so it what the customers our hospital? these at lot center, are Is

of think discussions, moving slow. in group into going strategy we're a they they're lot of big of pretty so their they're clinics. on network sort hospitals And that, of dive but innovation and And until they're how new hospital to not I get a dispense across broad because built to ready medication

Can converting takes? That's And bookings, how How that start you revenue? revenue? more would on the just translate long into . your to some macro pickup just maybe for bookings. then to really were into of the in time take we the and of improvement helpful. it see us bookings If remind line see to X long us maybe in it

is good be XX a coming because question it's months discussed bookings product. than look easiest for this is X the months XX XX in is to the up Nchacha metrics of Well, things about new Product confusing. But can cases. generally to because thing with at many installation, maybe shorter

So business driver the over X, key Advanced for that's . Bookings or the monetization or XX the in the part multitude either of even Services business. a years. of a different X, near-term stream

confuses of kind it hit But X they're generally to the backlog those and so months dollars years. X longer P&L. XX than will And when

revenue. the So look impact. for key gave advanced this the way guidance services us year for not it's the P&L on and But is same to the at our we

XX, as The of the is backlog services. as that revenue XX maybe in advanced the X, piece then So much monetized product is months.

that's revenue. of near-term So the more

So you the that product product the close and steers the business to and pretty revenue, advanced you revenue service think works. how

comes Schoenhaus KeyBanc. Your next question with Scott from

guidance The or product for bookings. revenue and the bookings product

IVX. and But live are in on revenue And maybe the seeing growth Series assuming talked health? about that that any slowdown So you opportunity? retail for about also in the a pressuring Services, services contribution side demand secondly, this then regulatory environment console new any are you you the from year you talked XT Advanced advanced as

we're I model, value the that think have health Well, brings. mostly a did slowdown line necessarily some in but the churn business SaaS. We and not business, live in the product or interest is different seeing

is impact. we it believe to certainly service IV were for probably where We on ship advanced want are that If the advanced we be it the bigger seeing IV be, side. -- a services would would riding

console. side on does from new contribution revenue, guidance it any assume your the then And product the for

the Small But amount the up half back year, follow in . yes. it's of

Thank you, Scott.

. please. question, Next

Lutz Your Bank next from of comes question America. with Allen

Nchacha. or Randy for One

basically a of Is review, on operational just where assets? strategic it sense the a XXXX? trying here more structure? the a expect to we the And the little in resolution of everything this elaborate table. you to the get And of bit on this something focused. the understand in here? should On then cost scope Is where is more divestiture can result trying on it . timing Could

a or Omnicell and holistic lot operational we've launched type year-end those. and of acquired either great it's It's right? last I had got it's of over a years, been to a a the time And review, products decline. since go-to-market review time this just we've several has just on mean long do

this makes do it So to review. sense just .

add to Yes. I'll just that.

enhance value well for tell a overall evaluate significant can us as our actions Our portfolio. And will from results to savings to creation cost to need we opportunities that performance as for changes shareholders. our improve already additional product is we while the that evaluation go-to-market taken that we've there of on the make initiatives where need and way, operations thoughtful our

we we think new that about your to through things hospital go console seeing the seeing, as you're -- in -- that expectation I'm as what those just here. for changes X Would curious drivers I'm of here confidence the the hospitals. to are the from what's curious XXXX. today on relates some some budgets with growth down around are break Great. other higher the it curious just of I'm And driver product conversations say providing XXXX. side if bookings, follow-up you're bookings XT the product greater the -- just as upgrade then to questions a kind to you curious, the

contributor But upgrade. the upgrading a the console XT XT line, we a line is of Yes, is point-of-care before, which definitely, the with did macro of headwinds right? the from cycle went and We product GX big environment the some has to time still improved is product line GX over Watson product, something there.

upgraded Now be for before. going It's we've which that a is we've got that's natural do. run to a the to next version, the XT console playbook thing customers to

to of line old, investment extend to So are provide be need with more resonate to this some bring will in security, that made X we're screens and really customers, keyboards and product they their XT X, these years they value, confident more replaced. the

So customers for lot It's invest. more days. very not logic pharmacy little a there's area for sensitive we help of providers our of to see nursing willingness something them which will a a just piece. that these bit and there a this is And is

question Group. Your Hewitt comes from Capital next Craig-Hallum Matt with

couple Maybe had a expedite Randy, think of sounds back new external GX. it's but explaining, the of an I a prior the upgrade. And console thanks couple on over that like helped cycles, driver kind like for you process. the When upgrade it your

at the use. think it was EHR I meaningful X point,

approval You had only the guys ones for that. were that

so helped XXXX help at was Is new could setting. point, new adoption something console it it And Is platform? of externally drive this a on driver drive there new side? you And as do cybersecurity this that the What upgrade? a X see Windows kind else to customers adopt cabinet. of then for the that

new for is In -- It's which, Yes. also itself, allow it will about to and well use some them efficiency be There's it. is we allows you of secure. it course, is access the so to definitely on nurses these which to innovations. enhancements. more more as to operating innovate latest a everybody efficient to that continue access will systems, going concerned platform, --

you to we in lengthen go investment have driver that console you to frame. is that to You'll along. if access as want made the of the biggest innovations additional And to XT life be probably the new able an have these

equipment we're do out of to that, going do gets of order And an when upgrade because you to in the continued have allow piece not the older of date. to use it console

upgrade get to the console. that the frame, so got And you've from to refresh

they're pipeline of we've discussions used it. understand the that that lot to. and -- years. It's something done had it's over we've So something a They and on

So very, how it's I'd to pretty of it's going, early with sort just returns. very expected go. say pleased we're right, it's or

implementation a shorter when then just in this sooner? therefore, or the question. sales upgrade, that cycle software, That's a because unlike and replacing great. maybe is should software cycle shorter And full being a shorter With you're cabinet, ripping help question that it sales bit maybe related result in . result just a little does similar cycle or a and

hardware it in the me it's fairly just screen it's and software, exchange. pull clearly. put like than and a and to ready new keyboard then has go. to old hour Less an It's the console. to interaction simple It But out use. speak and new the is let Yes, the a

So it's and not a the little to product bit simpler sale line. because little to you're forklift as revenue doing a major make well. of a bit a simpler

a You're of X a software. just already there little upgrading hardware that's bit enhancing with lot the . and and of

comes Your from next Larsen from BTIG. question David

your about along offset inflation own And own like your steel some and cost talk How increases in help you're of how are of to Can that And freight your customers? price base lines labor? by process? trends I for sort are your along those that? received the far you implementing and think being then . we

as but will normalized So recent in we we And continue risk the to and received by the . environment and our that well has we geopolitical impact actions, vendors. this believe supply our has quarters, pricing inflation be chain monitor that on take business. our

I we on sort the upgrade, sort this Okay. full Randy, like process more And about the talking been upgrade with had maybe being or XT think of of previous then through calls. of XX% way XT

new that think console, through about what we this that, to how full this you from have talk reset. is per to to upgrade Like expect can new for see should of much I'm going hearing . a XT bit you now a lift it's Everybody please? I pricing for little the customer go a is

to console are these upgrades price the an will year, portfolio we're work. to as about console to But X/X how and announce take Well, expanded at of it's broader about . going of throughout we this which just innovation unit. the the generally is customer, the alone, looking the

Okay.

So actually good it then sounds the that like quite XQ will my just And is it low. obviously a last X frankly, which for very revenue be looks is guide, thing. material,

XQ half Or great. So conservative, color there revenue kind if I I not expecting any is That's the concern And causing then guide? what is being being with Just you're my . the great. a be beat like lift of guess the this year? back Are good would Nchacha the how of you're in the quarter. here? pretty seasonality conservative guide you

platform, to, into point we we provided upgrade, Yes. a and about as includes we our a go for believe expect care the manage XT console improvement a that our remain and Look, we can which company in we we plan optimistic modest within demand innovation of XXXX.

Your next question Barclays. comes from with . Davis Stephanie

heard long-term I talking about exiting in against you growth the prepared strategy. remarks are that your guys

from are Day transformation? and a in just more the to away from last hardware about part lot Where that. still you wanted is alone. a kind Services I the you year, So know And services of was that software . moving that of Analyst talked target. revisit long-term that. play Advanced I of

the but a business of as And Yes. past growth over revenue always years, few has generated Advanced portion that our which been a lot big the part point of product very we'll a care. Services key, model and lot model. is of have Obviously, of of

now. like, And to to able our impacting lot a growth increased need But obviously, to is our but products. be have in offer those there's so more balance, model of of that we those point start can earnings. from back drive we'd model right -- our particularly care than ways And product we to and revenues get

as product move do to be don't to sale with key medication from helping surrounded service They don't really a run But have want But embedded doing processes a product selling or really as sold to day-to-day it's so either our in of in achieve to alone. by us want include sales alone. -- success. products the does so product for the products sales We them. sale they it offering those a around to enhanced service their services. be services operations the really customers and We can

know same. always day-to-day product be question driving the but these services It's with outcomes. to on answers adding services our So the that but of that are I don't advanced businesses the it's that revenues can directly, managing moving traditional and revenues, form and enhanced your if toward forward in we're customers' -- get the results

market that's helpful. end in the not, side more compelling that of pharmacy retail might some that but business go through the there incremental get review, of catch be is kind house into, like that's given shake strategic to And headwinds . X any on the are hospital? No, you of helpful, as the you

Yes.

there inpatient clinics always outpatient, I concerns lot in quite of sets the the that on and there's and side. the tool growth there's there think a have they that there aren't

And us view or a in are figure investing out. those of So those either or markets kind make our our and buy. them lot customers to want of certainly, help

So a sense those to lot absolutely, make of in. proceed

comes next from Your question Company. the Sutherland with Benchmark Bill

on nicely. Randy, you I just actually mentioned your side with ask capital particularly -- any deployment buy. to thoughts make building cash going was or the you and the what

the until I'll . of the probably but should that. here. it let on sort that distant refinancing we to say the off want Nchacha, debt, not about debt in have won't I we far of anything that's don't side Yes. at be addressed the Nchacha said get come too in if of I looking And know, acquisitions future. else

Yes.

of dilution the effort . upcoming are be minimize mindful notes XXXX any an convertible strategic and our we much stockholders. maintain considering in already for of the to potential to to continue our flexibility options and We company to various senior

earnings Or we guidance quite half lift. cadence, Got a kind back a of loaded? it. is non-GAAP kind the be QX particularly -- of of from it Is ratably the going the year, think on earnings, to improving? Nchacha, it full more quarterly it for should

it back loaded a say half extent. to certain I'll

the you ago would year. Randy, this headwinds, kind through which said that are state at a the regulatory work long of the conference by then, state too thought states, during that of most course And on IVX, least in important not Okay. you of

can that taking so to 'XX? you IVX expect Is said. what that's think be in I really off that the we case,

to but 'XX a for year think have I IV to is how get it of goes, see better through going think we'll just some because be I states. We'll much those

things was. of impacted on the that can site what stability IV and the the you long how mix Some is drugs

And the making so sites of our our original some ROIs as where high. were thesis proposals we for were

then to So again. get we those engaged to get those back had hospitals go reformulate and and on

year. . the I have worked through this that So of end think by most we'll of

Tassan Your with last Jessica . comes question Sandler. from Piper

especially. I helpful. thought new the deck Slide was really XX,

and wanted entirely? kind cycle the console the on the cycle to the on via just product new just cycle. kind during the cabinet XP console opposed console the enhancement as of to end launching clarity I the guess, a get So as I process bundled the cycle thought of versus upgrade new what's of of introducing together XP new

is Well, the a that it's tradition, this through or our also the an the been buy interface for our of us, it's and console brand you from hardware old years, of halfway about includes has just XX part and really replacement if frame been to get upgrade console. enhancements good of it new but

rollouts them purchase and So and with of and customers extends their customers it good we keeps sense of kind it, to of it for revenue us, move us transitions as product and product asset. for it generates It on expect engaged to makes new the and life services. products

XT. the installed our know, just in don't our So X say would have customers last, I years half I

So frame it's a of piece at new hardware to . timing the total with not point. up come this

our move And the be would in go-to-market. so us next this for logical

And taking and of this historically, probably lot we we had in had that's sense. this of the as off process. on the well we've cabinet -- dip sales of we're on some As XT upgrades off pulled reason a tailed console in probably XT kind makes the through were pandemic the those is

forward It a help us revenue And and the expect basis to is so which that and created drive really more profit.. people a what we're consistent getting time. this about And going, should out it rope. console on move slack even in now the

Okay. helpful. Got it. That's

implemented if or fair? that a drive console is agreed upgrading the driver the whenever XT not who to this base? to paid customers revenue And existing extensively or already the Is implicitly share they've way market kind So for incremental released. of yet, gets the XT, have the console on it an but

X years. the for XT because it's quite of gained base, This over and is us, footprint X we've our large or all right, the that for last

. XT captured a that into So customers we base this today. is have sale our

about at your the is that 'XX a just robot, miss wanted your guide. dispensing there IV the those quickly X products it in changed bookings for Have If in I million about follow products of guide, new then just or to philosophy midpoint. to attributable up And suggests expectations the and imagine central 'XX. it. Got guys we bookings in the the significant that Okay. thought the pretty that preliminary miss for about compounding those guidance you around so on in versus 'XX commentary majority $XXX were

the increase with... of level kind of Just they are that products conservatism given new

great point. and that conclusions it those that reflects And guide that lower our a I that's just had. you bookings see is you think Yes, in

So I there, that's yes. implied in think

Lipps the further no difficulties I will time. any at are over during the questions this We technical apologize to turn remarks. conference. Randall for for There today's closing call now back

growth We Well, in do our thanks earnings 'XX, lot is long on really to move as our even we're for about we forward. our in to consistently got term. on go-to-market stepped a really have today. over believe excited joining path We've we innovation innovation quarter-to-quarter but us drive that focus up going road our really the

fit as out and which XT how and earnings. what It's they and a our exciting they is mean customers really lines. rollout in they really to of our the come phase, road map and next and -- for our to upgrade more advanced even they what revenue service way, to into look seeing So and mean it's innovations these phase to the new get

want hard for our to back customers to thank to to working also employees growth great for and value I get we our want and going other to everyone. and Thanks, Cheers. for the each back company as extremely Omnicell continue profitability. deliver

concludes conference. This today's

. disconnect. now may You