HSTM - Earnings call transcript Q3 2024

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Operator

Good morning, and welcome to HealthStream's Third Quarter 2024 Earnings Conference Call. At this time, I would like to inform you that this conference is being recorded. [Operator Instructions]. I will now turn the conference over to Mollie Condra, Vice President of Investor Relations and Communications. Please go ahead, Ms. Condra.

Mollie Condra

morning. good and you, Thank Thank you XXXX discuss quarter today joining us results. to our for the me Also call conference on with is A. Robert and to Senior CEO you remind Jr., call results Roberts, and the that and of would Vice future and Accounting. I HealthStream; Finance cause President from statements risks like materially actual that contain this HealthStream performance Frist the events of also uncertainties of and forward-looking could and future statements. those forward-looking differ Chairman may that projected CFO to Scotty regarding conference involve the in factors Information release. [indiscernible], could contained concerning these adjusted a non-GAAP EBITDA, including Forms risks and from SEC, statements the the other [indiscernible] to which are is those XX-K, with forward-looking measure. that differ financial XX-Q earnings results our filings the in cause and in providing issued table to attributable release is A and EBITDA information and adjusted yesterday net may call. that supplemental reconciling the income to to included this earnings we in HealthStream on refer

So at Frist. the to this over turn time, I'll CEO, Bobby call

Robert Frist

Thank everyone, earnings and XXXX our quarter third call. morning, Mollie. Good welcome to you,

products are and seeing $XX.X that API-related and HealthStream of credentialing, and million reporting our scheduling a quarterly our and lot Moreover, in record year-over-year in right to some pipelines center. strong highlight credentialing we each release. delivered that market-leading our sales analytics I'll the on earnings pleased We just adjusted third financials. $XX.X cover We'll showed on we in record revenues start We have with learning today, ShiftWizard in. basic the in quarterly categories -- of major report financial I'm to performance bolster our EBITDA quarter, million. and and new CredentialStream jump of increases in our

product that third right that's happening exciting rollout one a And an so there, bit now. talk about little I'll in

little growing. One also in operating school students these is about which are traction those that now nurses. is -- bit X a for we're communities about new nursing a markets, the And and market, both one are including minutes. we that We in of talk few gaining is talk for we'll here

to nurses. bit we're operating communities, for progress about core addition and those We'll one one this in development growing excited growing platforms, talk students towards for the about our and underlying milestones a So our among X key put later. I'm the in ongoing hStream a applications, capital quite technology now suites. into which of network. manifest, And application of the primary and we and communities one X a to our that's is and actually thriving is -- time our bit ensures X interoperability social starting X between X communities

talk So well. as we'll about that

the do to As go to off story. the new of basics benefit I back summarize of the the call, anyone to kick who's basic we business want the for model though, kind and HealthStream

our care a believe, First are through and workforce of dedicated company care we sell technology of we've recurring we predictable. platform to under few and X that on subscription contracts technology in solutions average been talking health they and valuable, to which foremost, years for now which is SaaS-based achieving years. that each becoming a hStream HealthStream about more developing, the the revenues our length are interoperability a through makes Historically, credentialing health basis the because scheduling solutions, X

are In fact, revenues XX% of our subscription-based.

health the started open care training. continuum students care to channel I health professionals also our just of have sales across and we mentioned, to As nursing directly

We are profitable.

strong and $XX.X interest-bearing We cash have no million. debt balance of a

addressable care XX.X solutions. professionals health are SaaS and more specifically, market the focused on care in the The health our States workforce. and We comprise million students care total solely nursing the United health for core

credentialing achieved having Scotty, I some do and our the discussion, want suites to successes scheduling to over turning we've learning, application Before the CFO, of quarter. more highlight each financial it a and our detailed during of in

Let's product Center of start launch And the the is Learning application the I first, suite. our that flagship the is product learning weeks, out. right, a And with of that's In we've is mentioned, the we I key roll application as where that the want it few our HealthStream Plus to suite to last Solution. kind started speak. highlight that of name Insights as happening, application --

technology reporting technologies, rebuilt Snowflake have stack Sigma. and our We data, and leading including analytics on

for We refresh. learning which is and our of something critical reporting those that we -- on is assets learning to data aging base reporting have Plus, to build an Insights X we the data. our back technologies architecture used most upgrade our was was customers And provide to to tool needed

we're initiative today, customers management technology on new initiatives. and learning our today. Insights provides dashboard. Plus the of the with an experience, they enhanced expanded and Insights analytics X about analytics excited tools learning and Insights Plus announcing now roll including of the after years focused stacks. impact replaced X reporting solutions, out of Plus measuring development, legacy as nearly has So really it We're launch

Our customers' been in Plus positive quarters in first $X year. just over the bookings Insights of million very response X the to has with

So we're speak. in the we rollout and as applications application are customers way, obviously advanced the Plus of now phase, Insights positioning the it we and demoing the suite are along receiving

budget last predecessor talked the our pipeline year the And about period Xx I Xx the mentioned XXXX. in so this the that same bookings for products for bookings and FY just is we nearly

an now to the could last So tool is X market, the market-leading for exciting. sets, suite edge the start play brand-new talked how opportunities. lot highlight, we're in the development our sets. analytics cutting announce and our weeks, And it's hStream we're on area modernize now of learning to helps that tool a about to excited an pipeline reporting is which area platform of for We've and growth able into executing a

excited So watching really that we're about rollout.

I want an our talk APIs. And on update adoption of and developer related, about customer somewhat to portal

API, deep Specifically, the which in essentially system many at functions and is management which this the HealthStream key learning case, the of is our of all learning emulate robust our able Learning Center. a learning to functions or API, very

their API, nearly our the integrate learning over doubled this than increasingly portal we're tools XX say API as well. A developer our more accessing doubled learning the number to customers a of third-party of the months with mission-critical developers organizations So number last excited workflows. customer to and are using

More production importantly, the tripled. number of have integrations customers nearly and has put built into

Center added HealthStream other to kind of its developer And about these the is a customer Coast And quarter. the Insights few we platform contract during customer East platform they add development renewal, example so I strategic kind to in again, the as key third hStream things some pulls additional a The well quarters. about. And as talked And EHR, reported, contract to continues was door portal, activity that integration also this last the is which their we've as developer to products. to capabilities HealthStream for surge. about this the has learning of Plus the the the built the means talked both a using integrations together lot in large renewal and the is just interoperability They front -- A of great their talking API that we've been and that same renewing us. and portal. Learning actually ERP,

an one is the EHR. an deep they've customer through of done sets platform integrations training involves of their the activation that automating kind of developer using the tool on accessing hStream going on So portal. Financially, this the

increased And so revenue in integrate to now from our with annual see this EHR. beginning $X.XX of kind approximately and XX% we're from with, system their case, million the recurring approximately learning own workflows renewal interoperate to $X.XX of the their million. Financially,

extended term. only not products, do renewal base So course, they Plus very few and they of the products renewal on a renew the effective, Insights added is the other and, the

excited that customer. see in growth a And XX% to so we're

that And new brand some this growth is of announcement, Plus. Insights product to attributable

on in so is customer of And our expanding existing share wallet good learning a suite. measure this an application base just

a excited dive the really in a the access deeper So little we're and integration of sets customer watching platform. tool hStream and

into think quarters you I our And contracts the wasn't kept had do. to but always on know puts gaining XXX,XXX escalators renewals, in last they XX,XXX a beginning We base build initiatives the to relatively for a time. like little to So bit annual call on pricing historically, on the of their listened X-year escalators inserting added closely, who users And which and them exciting. learning really those their It's so our software growth of in strength they again, approximately companies ours. a of applications base contracts subscribers couple which the roll been out into into network, that, we're in that we've analysts pricing super over that they're well contract, over agreement. the is, grew, of kind to of most the way course, exciting pricing importantly, flat, their us. Along way, insights a

includes I we it escalator. so on annual And know, agreement, in were pricing X% or reported we an deployed X% X.X% X-year pricing escalators. again, think this I And

As as type period which this growth great the agreements, to we rolls of add on, for a X-year and But renewal, of our year with trying success. insert them impact we're that every is over kind base watch into exciting.

exciting third quarter on happening sales suite over there. the there grew move the are from equally Revenues last to of because things credentialing CredentialStream Let's application XX% year.

from customers And legacy application go-forward from XX% about that that and third and quarter So companies customer suite grew so our again, SaaS over the the who some applications, is sales year. of build are acquired it application last customers CredentialStream we're new our migrating help excited that of us base. the included

University Health the System. the CredentialStream third for in entire of health enterprise contracted organizations for Virginia Health, UPMC, Some of quarter include who Sutter their

September the upgrading excited all that HealthStream release X X new systems announcing we CredentialStream on Really to and So developments quarter. On XX, during exciting in either issued application or really new and the third motion systems Credentialing. see press recognizable legacy to a from suite.

deployment. to in capabilities of So throughout quarter fun made the and lot a we're where capital build now efficiency a products, those beginning the launching It's again, lot we the and into period just to to QX, launch this we fourth CapEx market. talk expenditures we're about be

these So build arm it's up and investments months launch. a a XX to have lot rewarding that because time for of long us taken are

So patent. going recently privileging, innovative that kind of our the of privilege to noteworthy and to approach solution announcements those In I'm recognition the differentiated our a program, in we're received through real quick. rattle

our and intended. another see pun patent. So property insights to our in manifest into intellectual in our this we're additional of to products But and no industry, kind insights unique the begin case, excited

growing I delivering think now dozen patents library the into over a feel we're a because we market. have value and we unique

credentialing the but hStream wallet credentialing. that for Second, hStream And who the platform application each use Remember, suite, announced a or value basically to a includes later, to our validate also we package that data subscription prepopulated enter credentials for those that purchase they time his call prevalidated package. called the that a on customer means that number that we portfolio. buys provider bundle of Provider longer or have as accesses Portfolio. of More a are CredentialStream, when her no provider providers credentials their provider now already

our portfolio to provider reduce workflows every going in this credentialing provider the new is capability data having prevalidated network. of new and by this on it's and So kind processing to prepopulated, the country.

another release. that provider now in of So Again, to press recently we're the market bringing really just portfolio. about and things excited announced those one

saves ways. excited alike. It -- this works the the department for provider benefit. time Now both how brings it it credentialing and and effort really We're just

the it's the HealthStream with feature integration, introduced called Learning in My we integrates that CredentialStream Learning Center. Finally, now

opened just Center. enterprise actual talking the great. this application some and really And is HealthStream And suites, we about between credentialing so we're Learning learning seeing benefit now which discussion application, our

to we into This offering of and to prime My a workflow example this allows This learning when hub in application work required suite. to us feature. the solely the begin our plan in that physician physicians, learning them where ecosystem are. for order used is over they So provider Learning notify in meet exist they're they credentialing the have example, to at that

new physician the streamline to have training and know if mandatory letting are a And workflows so physician to maybe they that X some applications organization. to together a they work now onboarding

interoperability this demonstrable customers. beginning so be And to is to more

those X happened to new the we quarter wrap was -- I a takeout. market are this bring that health in then Examples include ShiftWizard one our see, care to both third in announcements at were to the of third In to prior ShiftWizard System another I now quarter, by kind conference, during competitive in going Health, portion Grady quarter, at great out the those we're think third for Memorial which quarter. of year over it's time. And big and thing the all some third let's in the XX% So quarter, really Health contracted conference. the over was that the application. highlighting And announced up grew here NAMSS ShiftWizard And and jump ShiftWizard activity organizations revenues I'll from the quarter the area. excited that

to So we're as see scheduling landscape in in over competitive certified in of only chosen and Workday health tier a gold announce takeouts, excited was the market. We're and competitive the is to care partner again ShiftWizard the partner the meaning first integration excited by solution Workday. we're available being that recognized that options innovation QX,

take excited in we solutions market. applications shows the working are, good unique again, case, this sit and It interoperability of we're capabilities that bigger market. our So to alongside the a just partnership how to in to how have announcement like really these or on ERPs some

with gold the relationship that standing now for. partner through our innovation we further Workday partner to excited tier integration we're and certified have So

saw site. Finally, ShiftWizard we reviews Capterra for the customer unprecedented in in growth on QX,

if our time understand future go why Capterra know about you So review and you'll so some take you to ShiftWizard. the these, to what you people about of we're to And product, think if the of want excited it ShiftWizard, quickly out. can check

reviews customer advances to rolling our these products and applications are consumer the on exciting in, feedback our they're technologies. the and ShiftWizard of So in and see

dive to Roberts the into hit I useful. I'll to I the little I everything financials. still that deep on go in a wanted it skipped hope was Scotty? planned script, opening here. I turn I to bit think in Scotty around over now the a so

Scott Roberts

right. All good Bobby, morning, Thanks, everybody. and

XX.X%. quarter. year. with otherwise go the XX%. the X.X%. into million, against were head the up $X.X Revenues same noted, over income So for which and of let's $XX.X income then it as was were after million, be for million, expectations final And up was the the begin quarter the period and up $X.X Net third financial that, will comparisons the they of highlights last year. I'll Operating Unless quarter was financial updated was we the

Echo in that among overcome revenue solutions XX% some such course, Subscription of MSOW, MATE helped by often on-premises in up million share by product opposed was XX% Our a DEA $XX.X or we innovative in compared XX.X%. from XX% is with $X.XX ShiftWizard X.X%, and launched share per as our it earnings $X.XX SaaS X%. Revenues up at and suite, CredentialStream or our was products, million was solution which million, to others, variety increased was $X.X $XX.X coming share, per adjusted million growth EBITDA revenues from led X.X% $XX.X million million total accounted as were the million, a of legacy in million, and professional are products last such our subscription and Revenues year's growth, by with third growth growth, of $X.X with declines as $X.X of the new for S.T.A.B.L.E. last year. Growth and $XX.X increasing to ANSOS which quarter. and an revenues or our were QX XX% solutions. $X.X by services these increase products, per solution

mentioned, products manager, along Taken of prior third approximately declines just with in third quarter compared the year quality I resulted to million quarter. revenue together, $X the

professional million from revenues from a acquisition. payment approximately the included onetime services associated $X.X customer with Finally,

to was Our be remaining to million million the of the converted we XX.X% of XX% months. Gross and both the of and $XXX end prior expect quarter revenue next performance quarter. were the the year current of year obligations same XX last as backlog for approximately compared period the the quarter over margin $XXX for

well centers prior of X.X%. the of the data on up sales resulted cloud. from $X.X some of amortization by and was approximately revenues impact year these paid amortization costs The by and and was expenses, up of and Operating product reduction cost of years. these in These hStream million Our that nonrecurring our in was investments in areas quarter. was declined increased the software EBITDA, as as declines revenues, increase from year-over-year contributed expense by the platform that I solutions taxes X.X%, of million, to excluding depreciation and Adjusted $X.X which quarter, margin sales over of that to as moving and the XX% and most infrastructure, we marketing, a reduction declined both from year. which in and cost of this at cloud was came And which X.X%. G&A expense X% earlier, increase prior million. third G&A positively primarily and approximately up we're adjusted recovery depreciation compared reflect EBITDA transactions X% other including are benefited $XX.X X XX.X% in of the mentioned the technology XX.X% costs last and was of hosting most growth development,

Now We sheet quarter. of over million, cash million ended the from up balances let's metrics. and last to move our investment $XX is with balance which quarter $XX.X

million paid shareholders dividend During program. for to quarter, we the capital deployed and expenditures $X.X $X.X million through our

made the We tax also payments million quarter. $X.X of in income

primary of prior last year. million were Our were improved $X.X $XX.X year. in million days days cash about million the or to And flows reason free or for days cash last income resulted down in Year-to-date, flows to compared from cash were to our cash the compared last flows million and from tax compared down sales $XX.X year, decline $XX.X the $X.X million compared X.X% from flows both operations outstanding operations XX million and at XX payments million XX.X% $X.X to And year. coming more free to $XX.X prior from year. the

us debt improve $XX.X several million to deploy value. strategically options balance sheet of remains strong available Our to shareholder capital no with with and cash providing

we how me prioritize allocation our here take moment use a and our let describe capital. of So capital approach to

our which R&D expenditure organic making into back is plans. and the priority annual is capital utmost by business, investments evident Our

executing. track have we opportunities, The second of is pursuing record acquisition long a which

repurchase our we in which portion of dividends. that executing. track cash a have returning of successful is may our The fourth our And a also back third to profits share the is Board priority shareholders authorize form of record programs,

an financial, continue markets been Now fit a XX months, see M&A evaluate the We perspective, our months. In them continues from back industry, among Directors And declared that over to have up we include active the in be dividend product cash share an quarterly criteria, the paid it and health than deems $X.XXX usual pick we November. yesterday, slower and to of technology Board maintain as in expect our an to opportunities repurchase to we in though care XX have while M&A to pipeline, active begin programs which Board next others. such our currently do not dividend our of place, per in respect share program to evaluate appropriate. past program

earnings million. on adjusted Now between release million EBITDA. revenues, yesterday, updated guidance. In provided expect and expectations income We net financial now for revenues moving to $XXX to and consolidated our range we $XXX

We million, expenditures between between income and range adjusted between net to million and to for million expect million $XX and $XX range to range million EBITDA still $XX.X we million. expect capital $XX and $XX.X and $XX.X

a for assumptions include any complete may acquisitions during of not we that As the does this reminder, guidance year. remainder the

our range $X year about million that, revised to but probably be end so full than the lower. noted we've lower range come around of call revenues lower or about around or the As million $XXX the during little to our for expect we a potentially quarter, in last the year,

revised primary last is reasons a the we forecast well. that quarter of as one One influencing discussed

a year, second beyond [ ] lag. And second to And year. to order in estimating been and rate not returned while the above would lag that to had in had normal and their we're the expected we this customer's pleased a their billed based from the this return accelerate the second consumption catch that the would come little more rate level now normal for normal only rate quarter, projected that consumption certain expecting. they of of customer of their customer level, did to up accelerate revenue quarter reason, previously half as larger we not consumption lower consumption but we're on for a the the during normal is we than in a have We in customer consumption the now has content consumption

updates. for $XX now believe is quarter's guys, usual. midpoint also come to that concludes adjusted well favorably, We be And million for and to to Bobby we've which that your the for why we're this as in EBITDA call. between now range narrowed it the my and turn Thanks I'll over million. Well, raised time, positioned $XX.X additional for comments some

Robert Frist

hStream their you, credentialing our scheduling beginning own and strategy. the Scotty. growing at remind questions. via core its powered more as into platform dive it everyone a by Each enhance and are to being level build areas hStream is APIs Increasingly or application in Thank technology Platform going platform. of third center platform start turn our set platform and use reminding are to of solutions. and to subscription-based own customers of I the over Service to is learning, hStream our suites that applications want few by parties I'm a to to the our provided our

content that share that area. value that positive the growing in and get, hStream comes we and form subscription subscription an benefits market. package. to shared in talked expanding that to of a core it hStream is news other tailored and example, these a market think hStream plan for the membership that and and into with we're learning, the access, services, I'm we bundles. Last of health these hStream respective each it's package for of at with getting they scheduling. for suites the those platform I X little APIs receptivity putting better quarter, proud about credentialing And our products, and business which a the purchased concurrently that earlier, and comes we momentum Additionally, application each is our value packages, products exclusive of credentialing to quarter, value applications, hStream call defined example, is customers Each just access to for for And each address provide the

NAMSS September. solution, network the by in late our HealthStream, announced officially at conference we First,

marketing at at pipeline efforts us Our NAMSS X our than opportunities helped quickly a generate more of dozen organizations. news plus

We convert the few over of opportunities expect that next several will into sales the months.

has partnered health network Verisys to bring plans. Many Secondly, solution, their a an HealthStream fulfill or want is health we footprint both believe they want a solution to actual market provider about, specifically but members. exciting The we more data, rationale segment. partnership behind who market plans to can large also SaaS with health Corporation, the Verisys that innovative the plans in We for this only that solution with formally is manage plan combined work. tailored by for credentialing seamlessly plus health XX,XXX to the network network the that outsource talked of these needs the XX,XXX,

HealthStream well we positioned we're think new partnership recently with new product set again, So by network announced with our Verisys. our and really

we marketplace CVO providers health services, service the first Third, for of industry's have built plans.

with Our marketplace we plans. built-in Verisys have large is X for HealthStream health verification CVO, launching members, organization and CVO, a initial the CVO small credential very

into built marketplace. we our so have And

CVO our X Verisys. The members own first are and

enabled data can member marketplace can to and platform. portability members marketplace marketplace expect HealthStream, We CVO want data in as as which we've within a to ahead. I the verified that data the network information adding the well health the to back customers this This the provider note built click X the unique CredentialStream to hStream exchange -- by is by also plans which plans health both system. feature from grow applicable via quarters by send send

our and is students a these more communities managing the a true I actually we're professional to pre-professional of it's but One mentioned growing that social let's to is community community other of move markets. social, network, Now and nurses. semi of a direct and

a each to those. And about bit so want I little of talk

to XX nurses, months nursing end over strategy the included expansion physicians or has like students. market selling Our users directly last

so And model. of our selling kind that's of expansion a

in technologies ways again, nurses we platform the through great of learn app, One store about app. which of we is the is this And the to learn learning little reach NurseGrid example essentially talked capabilities. that using power a a NurseGrid API to has individual NurseGrid, our our

#X And learning and to on the social Learn. based app learning now period. for It app it's linked monthly the so Apple store nurses NurseGrid is is in nurses on NurseGrid commerce-enabled a network. users. most And called is ratings for truly thriving And and network social the a downloads the popular active reminder, as think Store it over XXX,XXX a We largest has and growing least NurseGrid XXX,XXX we growing it's started planet at good about it, where acquired since very a monthly or the clip to it's States, users, month United with XXX,XXX active at in we active the grown efforts to around that Learn in quite exciting But the of users. Look value some it's network, well. and NurseGrid social NurseGrid. announcements those growing doing provide for was nurses to first now one

in fact, nurses Learn channel, to monetize the to audience we way helps In due we helps that started NurseGrid and us the opportunities. also think NurseGrid a generate financial

year example quarter. And So historically only channel being we're over Learn NurseGrid the excited prior that you was an about of sold I'll provided channel that. In the increased third through give approximately XXX% Learn quarter the the NurseGrid XXXX that e-commerce is sales product BXB. through

neonatal of efforts program for expanded marketing knowledge program sell skills NurseGrid for specialty for app, only. sick Learn to a essentially created of organizations program S.T.A.B.L.E. those by aligns world-renowned area the expanded is neonatal students care. life-saving of of an XXXX, focused ability selling a and to good the of we infants. We our and we directly an finding reach S.T.A.B.L.E. critical sales channels Prior Chris it's example whose the with we purchasers is our nursing So is Dr. nurses marketing The BXB example In NurseGrid individual and now it's and our launched part nurses as to and it's nursing previously education year, individual this on partner, and believe and The Program this Carlson, through schools. health business-to-business have only were to how content to sold audience individual well. directly sold is sales later begin our an named care Program. now a S.T.A.B.L.E., by and S.T.A.B.L.E. initiative to

seek from they to particularly Clinical called rotation My requirements application graduate fulfill HealthStream's as to ecosystem provides within students to useful school. Our gateway reach nursing Exchange their clinical nursing

Exchange their becomes facilitating You Each between through students. the to Exchange Clinical have takes for can completed HealthStream's manage student of a Year-to-date, that rotations scheduled ecosystem. functions as schools hospitals the My individual My clinical and member credentialing rotations. Every over Exchange onboarding including rotations XXX,XXX uses within bridge students or My think My these application Exchange identify, Clinical Clinical who either and important students for clinical groups of Clinical rotations. and an them host those schedule

XX% last sets HealthStream throughout Third with that quarter which many XXXX their up enabling professionals will now and of year. accessing nursing revenues health period My social were Clinical made NurseGrid, phenomena from same the about possible e-commerce-enabled Exchange We care both over careers, students read from My benefits believe and our app. just capabilities hStream we've Exchange inside platform the directly talked of like is Clinical

by in so dividend, work of in who little We're that thousands our determined Alzheimer's recurring join maybe our streaming fight really fabric our We're organization steady excited that share at. and hurricanes a and worthy of recent we COVID, to development supporting care team. select to for HealthStream an materials by accomplishments gains forms our other summarize in sticking base. and assist now, a good HealthStream our I'm here streaming committed and you're horrible to our that this I and to form tell about look employee we to in And interested proud is education want others our provide to support the SaaS, to value good living $XX,XXX our sales of good. each access That's guys profitable, we to goal, fact, And as of about our growth much raised directly information. Association as employees a PaaS honored to for attempts of deliver for and some a our just company. Both this We're into Alzheimer's value value our nationally, of year, pitch. health kind revenue, X,XXX throughout a dementia. about streamers you I'm X,XXX to to company you attempts it. I nationwide Olympics living to is will the my of shareholders bit of where of expect we culture company. investor are year telling if highly in those learning saying So company challenge, health that technology ongoing streaming during facilitate the over And during are to charitable right a

quarter. Thank the So to make these releases, service market little a listening. help we I'm bit innovation during the to HealthStreamers into our everything our and new charitable proud our on work better, really our customer of both focus you and efforts fabric, accomplishments our

session analysts turn over Q&A started. now the Our for will get to Q&A it

Operator

[Operator to Instructions]. first our And Hewitt question is from of Matt line come Craig-Hallum. going with the

Matthew Hewitt

with on particularly. revenue top line growth, first Maybe up the

bit growth you've accelerators of getting X-year rolled Your could objectives side? going XX% little goose faster previously top else on X% to to But do? could add see line. kind bit talked on growth about do pricing to drive little of with what that the revenue what a out side, a that's else a new have that the the you to the you Or

Robert Frist

Yes.

first them. comment those on and of each Let break then me down objectives

in Day announcement in targeting January, Investor 'XX, next in, And on that was an to November in later. another first way, in an but Investor that target of try going we're announce the the objective by probably to think, did XX%. But meeting in X-year when Day. work February, objective to that that 'XX November X% as So disclosed early late growth we I early we of year, we'll

is going the And we're looks It around breakdown. But in here this X%. X% it to X% year, organic. to like come was

the within we've of the around if of growth new of right to the range. we're year you looks But think bottom in just And wrap striking at organic be top factoring So like of range. the our love this profile issued. guidance we'll we been that X%, deliver, course, of up to we'd distance able it

within goal. so And right we're of striking that distance

that blended, We right announcement, couple year, we're but haven't again, this quarters a since of it. about hit times quite it We've hit X%. looking at a few in

And about new you the the can all hear products. excitement

we can do how is is gaining with these answer new continue the traction So better products. all

some talked new brand-new application And just revenue. that the Insights like about products of Plus are we generating these

of inherit rate sometimes lot through And is we well, all the as the is the those answer and growth so isn't are inside we've like, look why a built legacy And when higher? application share you acquisitions market is exciting suites. ways our

through the And and need can. addressed that, we general, we it. these occasionally, like some suite. newer our work customers have struggle as more application And we we've to material. we But applications in with of those customers are that ANSOS legacy to them preserve and as migrate to

of this legacy -- And growth market, competitors. the just as attrition it offsets, a so of was growth $X about to negative loss Look, from in competitive some in environment. our those ferociously Scotty to applications million mentioned, is and

through about our we but fighting on We fair new than we and of share also share, dozens products, getting And our work and come, new our for these legacy is and them to issues. of talk more products there's think competitors we're everyone have share. many

Insights you've CredentialStream, HealthStream really that important hear you core the family is So bit, in go-forward thing things And ShiftWizard, little the sides by both are today. heard rates. had and it attrition to by on and you've escalators Center core growth a up our we of growth most we'll picking this the year-over-year could applications. and is powered continue work and applications, the new Learning like good as working up. If as which products of Plus reduce pricing legacy pop launching equation, in its rate reduce and products, today would these heard quarterly share

really the cash this some flows We'll reduce X% that. we'll growth wrap try attrition. better will then in good rates through hopefully, looks But it and little future. year to hold for like to free a cash and we'll flows the And kick at year. So about off bleed that

Matthew Hewitt

here super last challenging And a environment year. maybe little then shifting gears pretty macro customer spending That's the helpful. bit. The was environment,

of customer the that, what's side? that, you Are And spending into on noted even will several some think we starting improvement show happening? on as to accelerate expectations that's it sounds 'XX. continue, seeing maybe Is it in you fact, improvement. like signs that get calls, I your is it

Robert Frist

and learning as pipelines scheduling we in by and well. products our with did our call talking this and new Well, we and good about about credentialing open feel the pipelines,

feel good we about So pipeline. the

good Now both they But the deals to and QX, have need pipelines strong. really expectations and and to are close materialize QX. in in QX we

we again, we yes, this in see in I don't applications to if attention confidence legacy strategies. if work better opened do areas. But are these about the And on So They're more and to retention the call can and mean, in talking we'll growth on year that successful those our call in being by and I I'll pipelines. the closed pipelines. way, those what next rate is migration turn retention deals. to our not know focus

we sign they but and a Xx sales, the they as a want good coverage is of measure setting actual We kind typically, of feels objectives. are of to but in you're measured know on pipelines contracts, for in in pipeline look side. hear Xx you quotas kind Again, who Xx see cases, pipeline -- healthy turn And is coverage, what do -- the multiple your Xx So good. matriculate opportunity. And a those pipeline and of into those which and it a essentially. the from of to need that's both

Operator

And Barclays. going from of Stephanie question our is next with to the Davis line come

Stephanie Davis

really I in remarks. mentioned First the prepared you in bullish you've one I have, expansion the health on believe been plan And channel.

we've some spend as internally. So step back of seeing they there I lately be could was been more the if of given focus maybe kind in wondering, earnings just a NCO that

Robert Frist

not close I'm Stephanie, that. quite to Yes. as

We used And think they're from really excited cost insurer of the our and standpoint, the teams will application hear payer on those positioning our between I about a provide think have focused you side CredentialStream that, like hospital about did interoperability think the things market. then I And I in some efficiencies. side. that on the the on when we side, use and

to share maybe be we think And in those and so we're provider efficient the gain competitively areas. positioned more

they has market. then training, mandate always been provider of you'll in a them, if kind industry, regulatory the take have in training. It's quality and down be on even be regulatory the a even selected highest pressure lowest So some cost, and goal my

again, a there's little pressures space. maybe a familiar so on that. us. that But I'm for of It's the And one with less new overall

We very that excited of about have they're that, and their a are familiar with team pipeline. people

mentioned them technologies more really us. we the pipelines for look can't can well I today characterize in wallet we think have synergies offer than I And that efficient that just provide some it. think So strategy to We've the current the good say I use. they as them. that will vertical

Stephanie Davis

Helpful color.

sales channel. the on one Another

ton You recently. just out of a -- rolling products new you're

how earlier that these in as to How messaging having a thinking sunsetting announced keeping legacy the you sunsetting of these that some you call. your new kind coming out And on of are one another cohesive too, you're you of board? got of of debated of so products some You've platforms clients with? have kind many the play does about into maybe

Robert Frist

a trying the to we're capabilities it's Stephanie, and its some cohesive understanding great platform first. Right. create point. hStream of

before at right year we level next enhanced of the the half you're any to our repositioning the of first capabilities, show And now kind we're the new say I'd about So of global product do kind of capabilities. repositioning products.

platform new exciting new to to just a been be least. products. in of And subscriptions. last which developers in products cost do product. and out, working turn point, this is roll something yet that So have included able internal we XX level your on and another were don't we've for and of in lower which be into months years, I super then new start capabilities some the engine, we're some generally more out announcing able using build that, about And you say, rapid retire services of we'll to strategy because to X both you're platform enables and piece Insights sold been working development together old weeks year-end, announce by hands base replace customers' that kind generates be tease and sunset reporting of as the new by I'll is to many at to contract or essentially value it to fun were But get watching know, -- exciting. And higher have the hopefully, which and in pointed our our for, and with announcement. be NOV, those Plus I'd more one value another now order is -- we it's XX watch like or

you always application and more that begin more tactical have can work I call to little and how off where a like obviously an you at interoperability kind to of X positioning and position, what kind really they ERP I'm suites on customers. And like bit we'd next based excited operational CEO's the benefits more half a the second a suite EHR to of that that to that present of works of lot then together, strategic deliver -- then -- rapidly a a big show But their truly promise. we're times, work of maybe We'll in the a They And this of be slow really suites. on ERP, can we able together. And as year, and we'll their as offerings little introduce we're don't little to of suite I think, of so go as our suites systems guys position health have pick far of more you breadth the opportunity together. the where capabilities selling, area going like that and bit.

the Medical to area, capabilities a C-suites second new being next of I demonstrate a half manifest each in customers, them we HR just and beyond certainly overly these attempting Chief the buying in our our position half the our originally the the sets intended I capabilities I'd go little see next we're serve, say, of be have So -- to year, capability think them. second they to we'll are market think we the opportunity year. to learning more by we more of But as areas careful and market before the credentialing robustly Officer -- serving

Operator

comes Blair. William with Haase Jared the line question of Our next from

Jared Haase

Maybe reporting version just the hear more bit I'll of sort that's with next-gen hear there. I on functionality hoping sets the available was to a the ask Nice new any of now suite. rollout to one for little learning application incremental And positive the tool about tool. about this reporting

out to this over couple clarify, it's of pretty years? you'll I referred then stack Or bit the the a you to next of a kind up clients proactively? just go more to as is think Just aging architecture. upgrade. like as it renewal tech contracts something actually legacy And meaningful for -- push come you sounds can

So looks kind of wondering what the that like. of cadence

Robert Frist

comment on I'm as much I of can. glad great. as to that Yes,

One, Of course, used the architecture same here. a -- there we're excited our are you teams across reasons. for of that to we're this all are company. say really the detailed capability architecture the you will will this, Again, for I for products enhancing be when many But about new the platform of reporting learning talk reporting expect analytics data strategy leverage.

modern, capabilities. example, reporting that benchmarks better capabilities, more much new And so to are multiples is right engines. first the it's performance class you're technologies. of the a built scalable capabilities, analytics than older we mentioned also for And And rollout our on know faster, Snowflake, benchmarking enterprise this

able to into warehousing to if but not And secondly, -- I'd economics, you people capabilities. learning, pull getting the sources, were less technologies impact methods data their data just older harder oversimplify, now to its slow integrate multiple And were from old essentially configurable, can less reporting extract, look the say data in applications so other on clunkier. data at we take the on

the that much And there's learning and kind benchmarking ServiceNow, greater provides Insights the So soon. capabilities. helping level the come of reporting effectiveness, as we of Plus old flexibility with for much, then release example, basic minimal comes replaces is will measure HLC a but insights new the analytics, that just

there's so as And pathway upgrade economic an yes, well.

you So how and comparing know? profile. to the industry. others compliant you in stack. And do in smarter, flexible are and more biggest not things make benchmarking only make the newer What workforce better, based is competency and of sure on your sure faster, one it you you're customers What's your and scores. How pull our -- you the track you're you think is does I tech on you're data learning

critical. last architecture with and our into be data so it of replace and deploy feedback. to one modern use And XX-year-old days, the to it's a great top able that XX start accounts is in get great So to a really

So again, has value. and it new value, -- incremental order contract we did mention incremental

results Insights buy when in incremental for growth the you a So it's buy-up revenue us. Plus, and

those forget same X So capabilities reasons, built can technical And other on excited. for quarters reporting new on expect products announcements don't all the next you we're new over the architecture. for

strategy. the our expect again, is middle of well. By the which, Thanks to as next the across year, these that for capabilities really for of reflective watch lever ecosystem, platform question. So whole we

Jared Haase

switch comment in start and great little of make areas in just XX you of share pick organic of on the macro through bolster M&A That's sense your anything the or the And or here? stability something what's versus opportunities view? thinking we is as that to a you or months And over I'm gears next there to investment. then to that maybe a capital the I about set bit curious guess, M&A would environment, I'll terms so. incremental think solution the driving that just is hear. Great. would the follow-up, catalyzing environment up inflection maybe could else today see then specifically that expectation allocation that's in some those that

Robert Frist

company. recalibration it's that there's side conditions a a great are a our overall, think macro a like targets lens, meaning lot a buyers do that just do bit there's of equity private think, for on us, of say hot, strategic That price Yes. active of also said, Great improving. really the I are, improving would question. to we question, little -- macro for lots got the -- really frothy. maybe I that anywhere now. through the but a the conditions bidding money way them us, There's little lot There's I for

broke hard we're pieces. when we discussion make the reality. And failed down talked that I And piece. to the growth, so working second to about about talk X% to I it try finish a into earlier to XX% to X the

looks organic, to X% spread the like inorganic. this which It for remember, to deliver first So But years. piece was X% over going multiple year. the that X% other was X% was we're to

apps very been front And we've also so teed platform technology say, where we core somewhat focus now to fold the on while intentionally getting to weren't for the We've we're conditions. on decided for, I'd But and in. macro fit. and attributable XX some decided up XX months We've the to we somewhat M&A can quiet things months. right deals X the now, they feel but

hopefully the thing for quarters but you'll And see are I support us of business. immaterial in and first the think next X existing they tuck-ins, lines small

You launch. we categorically, will ask like what

couple quarters, next the be that currently you'll we're of to businesses that supportive understand fully I think you in. of will over things the see

learning, that about students X credentialing our nurses. and X So are for one talked predominantly. one scheduling networks communities, social and we And for

weeks if slow this of minority And things expanded those did of kind consider next year see model. so quite million of And would -- later about some we'll walk a ago, might we M&A But the in relatable quarters set quarters run our of you'll I investments first do time inactivity, think of half we for couple hopefully, months the XX next few next couple a early a over followed be complete to second of products. and investment. and we $X one example, it's by and just investment, then

opportunities bolster but small, the talked about. app it's with Learn, NurseGrid a immaterial, into business it's we will company our So that

the company So a improve for our into believe. that million announcement. we're service deployment nurses about super that we capital ability watch but a little NurseGrid excited network, will to that, on it's

that And on so announcing work we're super excited about that. We'll later.

would where technically, deals, maybe we -- or then in platform, our done immaterial, types the smaller the X look we lines. of as year quarter definition to And get want current be probably of immaterial our we anything we as be But at. next by later but of with things expand supportive next acquisitions measurably business the would expanding

I or helps have million obviously M&A to almost But million cash we wanted characterize $XX hope that $XX We our of be cash. of program. active.

have currently access credit we if and debt probably needed is much to more untapped it. We line $XX of million have an

going and but we're few on, life work show and to be nature, that there's teed a in looking, pipeline. immaterial we'll some in the again, up So scope that we've deals

Operator

is Close question the come with Richard Canaccord going Genuity. from next our And line of to

Richard Close

you or us on pretty mean, Bobby, I row in in Congratulations I think of customer a examples a on -- been of some now guess, it's warning escalators the quarters do -- have But cases. given you going last not and renewal. in success. not expansions you're if that's that growth more but to hey, I were significant larger warning, sort saying, X you've normal new getting quarter, think prevalent? now these products, the renewals become completely all are But these necessarily you

Robert Frist

our course, managers it's new renewal. at we have that account Well, into focus, blending every of and products XX look

extensions because the showing So renewal, there's getting a we're in better, interoperability and say, getting be a near interoperable at when -- they're little for they're feel products more showcasing more future. they made I'd case more to at or logical like

watch meaning it's so And talked The ARR drive you're organization, add the what of on sales the management about, better roughly on or has or in annual specialists, so group just an and focus and products, look our account managers account. And you a XXX that if an at represent X account drop if products XXX-plus XX they and account people. I creating ARR. or are to a I you they blend to so up. recurring It's work say, quota-carrying hope. focus on X, really mean, they let's specific trying the usually, renewals revenue the XX and

And The and blend they're products. better in the changing gave featured hopefully, growth the APIs and at show looking that. And to of adoption because today, at which platform products the of and accounts. other mix they technology, I the they critical continue pull-through the better cases were the get so

So that happen. than we XX for to be more do that have typical excited. you're atypical, on right. focused reason, people We and we're making But needed

Richard Close

anything Was as out? just And that the expected customer That's to lowering the consumption more call led or Okay. Scotty, the on to half? revenue. helpful. didn't bit maybe the contract little second for Anything accelerate then, of there a you specific levels that the

Scott Roberts

don't think deficit I I is up the pathway quarter, of versus I saw in that's the on to the the the in kind Yes. quarter. that recoupment just I the, second see that we they call explained third I to of guess, get pick quarter second the what did but mean

saw. the get that So they we through deficit was to manner didn't going like to like felt we consume over a it in to push that

bit kind little that forecasting be again. off we of So a to

Richard Close

Okay. just And quick. really then

the time set rearview -- to move is sort of that declines, is in On as come things product of terms can there for when does up sort line of mirror, should just How renewal? any the we that? that like

Robert Frist

I'll but on Richard, yet, work Not that.

it's products, would I sunset a whether products, by lines say. classified product, we they're you means which product products. call of Like maintain. revenue yet. many them Right carefully ANSOS look now, of kind new and what but they're We encouraged supported growth we've Here's our now, right and legacy it if not legacy very call at even

sunsetting. saying, not We're changing there in look, support not models. we're actively We're phase the of so we're And active yet. the

I Morrisey customers. to core get of newer think also some profitable like trajectories a company closer the credentialing, how risk have They're competitors we them we products, of just bought a think legacy And which and of called the so to cycles try built we HealthLine convert still if we'll legacy year, little lot our company do these and because they're to they software. a and customers, highest called next about you a life customers

to examples either customers. and to to They're ShiftWizard overall shrinking sunsetting are Again, they case, Morrisey of to X legacy losing and because We're out sunsetting and in you business. EBITDA they're they when by year webinars them as of the to growing. to definitely think cash flows to quarterly our do ANSOS are those our coming converting but for is them. our We're now. legacy, And them. so if of as those targets HealthLine they're we're still them profit contribute our up what competitors. But updates figure need supporting having We're or we're to maintain none we contributors our right We're them. becomes this say, CredentialStream in market also having the, and or supporting trying the not

service in them when We will customers, a a say, HealthLine ANSOS and them improve holding our we still little make right legacy ask and really we patching them. the X now, Morrisey, we I them talked -- but less for current basic maintain be do day ready ready so to or And and make frequent firm these as we infrastructure be migration. classify would to updates, their major to ones and or they'll we just well we and about, them try to service

officially that's kind next Once products, and having multiyear of we'll so get kind where sunsetting a them. declared those things and And for strategies clarity of be where to I'd like people that would migration more journey a they're be then year, say quantifying have on are. still that. path probably we on choices

take total it's the in we're better again, But face them some those of I the losing biggest few profile work going at attrition growth last us to is through in our instead stabilizing customers. quarters getting in legacy think is to it them the single think But market. time to I it. we challenge So

Operator

comes JMP Davides with question Constantine line Securities. next Our the of from

Constantine Davides

questions. couple platform just a Bobby, of

many guess, this, picture First, have Second, I ID then you've point. quarters just bigger And since more users a claimed I'm I of at question. think wondering it's of how hStream given been this a couple

Just terms of when the platform other margin of do it in is Or the growth you're accelerating more the line terms of this profile side be of initiative, HealthStream? on business? the just more in you profile of going top the see to impact helping

Robert Frist

like we ways, it wouldn't we started where before strategies changing in that, back this have journey. around X-year our that. goes undertaken actually, Well, data many And nearly things accumulation,

if we we have of think operating wouldn't and growth company, didn't a hopefully, cross-selling better trajectory develop products products. shorter new leverage, So undertaken both this it the to to provide time

just not rate hope of we better think at rainbow the I so is And well. this but as growth core end a technologies, better

just us talk want a a just exciting and about stack. think we and growing think to to drives stack we ways. I growth that So about tech It's tech sure in allows it new as don't make

I Somewhat tell when going we we more correct investment. it a a go the it. to I'm texted I misspoke. related I integrate made minority And to that, just and -- partner, to got ahead because like mentioned about

And million so in. we $X.XX put

FinTech bring into think to in start-up network. And their our So investment Plenary. called will nurses value some again, we their now be a small announcing will our And platform very XXX,XXX that. which services, using integrate technologies it to the NurseGrid services small

technologies our strategies, year-end, into financial our we'll capabilities platform the and announce And new leveraging the opportunities integration of rapidly. generate company, NurseGrid achieve for sometime to their before platform that

it's will FinTech be strategies debt that money-saving Plenary, as a when money think we Checkout beloved eliminating student that for nurses NurseGrid So off nurses paying provides as save loans. and to they're much helping

company of the kind thought was that a executed growth possible And about or opportunity good on. this powered as by a of just even and been think ecosystem built can platform of made have minority thinking you that we an you example of a Plenary new before so of think growth generate a true is million of about and platform true to $X.XX wouldn't when ecosystem, in platform, the little a think investment ways revenue

the -- is company, the platform an it's end far you're there when As rainbow, a endless as pursuit. of no

in just oh, opportunities -- but monetization the you be there new growth build It fast and strategies. discipline platform or capital crossing so in, here of we're you create kind to new won't the how how -- of, put is chasm can have therefore types the But have to done. data And it. and much opportunities then new you strategies build a where of creates

we is again, so Plus. benefit charge analytics evidenced framework we like our X launch a that started but as years reporting fun a year, X Insights part partner development, this We're excited. by to integrate new Plenary ability and and/or into and for quickly revolutionary And real its the tactical or overall, super seeing operational called

Constantine Davides

And the part on of their many IDs claimed at users have this point? the first question then -- just the how

Robert Frist

investor February Day. know, our That next Because early We talk complicated haven't about again, an a try numbers. good we'll But claimed our then. something to could target we next be report consider ID for January, that topic. you probably. which, certainly, conference, would year released topic late Maybe year, to Investor we'll early get that's before a as it's

there's number multiple of key there's IDs on and what are that those call then that keys that claimed we issued have There's then chain. those a and

So ID applications unique a different ID XX is each for is one having thing. but a unique our of another having thing,

that's whole Day. address initiative, we keys And change key so can on maybe something the in we Investor call our

Constantine Davides

growth and then one the point attrition sequentially to And product? starting me we on the ShiftWizard the is eclipse Great. one where last of at the Are for scheduling. legacy

Robert Frist

Day, again at have CredentialStream so talk against -- HealthLine, customer of at opportunities It good -- that when installed the a cases in few acquired crosswalk. a be might take you would and Morrisey you and these look exists because when about bases. these our discussion companies, which crossover that question to another another the opportunity look Investor Maybe to be at look maybe great same

I bit manage growth crosswalks of answering as than we'll plans place these crosswalk. a sunsetting mean years. earlier, those drag feel we're do active to we we feel the plans. legacy overall wanted. be X% But to as that I a There yet best excited the of But applications to more that we've obviously, nevertheless, and in the are I coming haven't from and show no growth legacy politician customers. have on of rollouts had they're because classified our over we through And migrations plans. like good said published even able during net a even more the

we'll the years. but -- something so And coming tackle that's in

Operator

Colicchio question And going of Research. come from with Vincent is to our line Barrington the next

Vincent Colicchio

my of been questions answered. Most have

organization as could want you you far us ShiftWizard the it terms curious, it on in along far how being as market? is to Just of be update where large for

Robert Frist

in our on meeting yesterday. say did that. Board other Yes. would recent I and I day update about actually an get that just And here's the what

because And and on think we'll data mentioned, turn so to we and end as launched that's I credentialing better we the Plus scheduling. at scalability, well next parity. feature be learning, management -- our by example, attention year, than we'll for of reporting for just data all levels Insights QX of on

legacy say year, beyond. of the would actually I is than have next feature parity the be of we and what kind application QX think think sets. We I should we'll so And better

than accurate ShiftWizard already place rate where rate. So revenue believe we're the and I run think run the is revenue that's an ANSOS -- also at higher statement. the I

crossover the the is and parity that retention I say, would of year. feature we've rates, next QX improve think our So we begun necessary to

Operator

Thank I further you. to conference CEO, any to or would And the remarks. over Robert closing back Frist, like for hand

Robert Frist

Well, thank you.

we've to cover wanted today. think everything I I covered

our reporting be will earnings to year-end -- I end next early forward call later of look think results, we year, February. quarterly So next which or

on since while strong. So the insert it's to you Day there somewhere an year that and we'll we going guys a talk work probably to to focus Investor be in between, we'll up wrapping

everyone, to days. thank in we dialogue Thanks. So you, forward look investors for our the continued Bye. coming participating with call, in earnings and

Operator

conference for call. participating. Thank today's you concludes This

You may now disconnect.

HealthStream (HSTM) 22 Oct 242024 Q3 Earnings call transcript