AMWL - Earnings call transcript Q4 2021 | American Well Corporation

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Operator

Good afternoon, and welcome to Amwell's Fourth Quarter and Full Year 2021 Conference Call. [Operator Instructions] Please be advised that today's conference is being recorded. Leading today's call are Dr.Ido Schoenberg, Chairman and Co-Chief Executive Officer; and Robert Shepardson, Chief Financial Officer. Ido and Robert will offer their prepared remarks, and then they will take your questions. The Amwell press release and webcast link are available on the Investor Relations section of Amwell's website. will are certain performance. important we that financial that believe we in note be non-GAAP discussing measures Please evaluating Amwell's on reconciliations these comparable between that is in the to our release Details most website. on the the non-GAAP press GAAP can thereof measures and posted be found measures relationship certain of during defined note this Private the Also, XXXX. by be Litigation will that Securities please Act call statements made Reform as forward-looking statements cause the and implied Such could forward-looking other to materially differ uncertainties are in or for statements factors results from subject risks, call. expressed to Amwell that those this now to Amwell. of And the turn I'll call Ido Schoenberg, over CEO Ido?

Dr. Ido Schoenberg

review open to Thanks, high-quality on operator, our solution the anticipated reviewing and results will strategic our clear: then by the our a market fundamental drivers deliver and start guidance. To innovators and At quarter providers, patients XXXX. of I'll our growth. of of with welcome, priorities moment everyone. the remarks full call, and define for to discussion I'll conclude Bob access discuss infrastructure I'll highlights mission review greater and your the Then Then them enable Amwell, is payers, the my promise financial affordable of questions. our and today's connects for for that the some some year. our On a to key metrics, we'll care. take

in-person, care Converge virtual We Amwell's great to that are many Much automated experience. realize providers, one supports buyers tools integrated advanced for QX our Amazon that we the was the ways industry delivery equips to patients turn as to and distribution the in find page to a care solution Converge. framework better and assembled and with progress sellers transforming health in-office care from quarter a like modalities. a another, them

quarter. the to recap take few highlights our strong. a market the Our well solution of a teams for is to moment are and executing I'd like

making With from in are on progress of models demand prospects. with and in customers of development efforts Converge. delivered we and our the Converge deployments, bringing First, line are focused live finish deployment R&D part high are substantial platform that good several remaining a and our our over on our now

this Application industry Second, Gartner Chilmark of the top ranked Awards. progress QX, also Leadership major also recognition Converge received the in underscoring MIT during UCSF by of at recognition. the review. was Health Telehealth recent Best Council, new New Converge their named and won Converge Research,

this for and clients' honored new are large our to innovator leader We by are that Amwell, And new platform. Converge, to with receptivity and amount in in favorable of our multiyear of as a space. indicative registered Converge, responses QX bookings we

should to large to to We systems health payers build in expect and we existing this care continue strong bring functionalities as customers. as add continue work and Converge on and completed momentum for Converge new modules

of to initiatives. newer Turning our some

automated are virtual to health expansions some We notable With to are also reduce module. support outcomes. improving system patient momentum mix programs more programs country designed Conversa subscriptions need ended and And while patients we at Amwell patients our on among mental SilverCloud, to and Automated newly well burnout by workers some frontline of legacy existing manage behalf care Conversa, underway longitudinal approach Converge remotely identify their access enhancing experience health building with the including providers and digital revenue customers. are programs advance we XXXX the workloads. who long-term delivery offloading leading These XXX which across with care over health higher-margin of the and acquired care and QX time. our with with organizations SilverCloud, of wins, to integration help

won success in X a in health won providing a nationwide we recently wealth SilverCloud is large million we markets, also strategic systems for to the behavioral services several health contract citizens. over SilverCloud. QX, bookings U.K. where During international

from some like would to services our I team. shift to Now highlights

is to existing team platforms services currently Our busy converting from our health customers Converge. system legacy

progress, most our to business on meaningful to with As Converge, that Converge believe describe progress we our ended new is converting the during about of of are our our metric visits to We increase it platform. metric XX% and significantly visits we XXXX. on look QX the goal

migrations, products. addition all successful growing to these are across our seeing In engagement we

providers, over wrap integrated of I visits year EHR place big indicative view of our of the highlights, a fundamental are adoption we And and driver which towards over in names, add solution, our I'm of putting patient mission proud driving solutions Our QX a want teams active crucial to XX% future ago. health that engagement year per grew executing, executing to among the new our the of infrastructure, up of our delivery. the number landing are define enabling something number ago, healthy elements as sustained XX% a of grew To a patients. how care

well-accepted are is some Next, like payment and portals much spend with to acceleration, workflows, urgent These disparity this and sophisticated implement been the and It rules in simply hybrid are pandemic are documentation that our challenges. point commoditized. complicated also I'd fragmented now the and time practically of systems. clear seeking and confusing is reviewing what the solution. significant payers dramatically integrate and briefly potential that include and have nonintegrated to facing now for telehealth broader accelerated and we market seeing to care of difficulty regulations, innovators Providers, realize adoption. care visits It solutions

unified a the for define to hybrid requires health for the care we delivery, video one a Our for support for conversations a model. patients defining care At requires. are strategy. telehealth Amwell, that are market solve with are health visit, extending primed continuum. It true that customers connecting industry partner complete distribution our and the we providers a digital digital and care visit. their implement logistics emerging challenges to not the It's is delivery beyond about the is than to care platform solution creating and many just that for virtual more addresses and digital More managing enablement indicating health

are delivering We that vision with Converge. on

provider a example, significantly infrastructure, convenience their insights use be and providers able the Converge to and the enjoy physical, the increase gaps and network empower automated of efficiency of by in at to gaps. important to care reach For and optimizing care virtual these share digital-first continuously IT on Patients health will Payers experience. of their system connected health be be care the able impact address of will heart their will interventions. and providers to using

impact outcomes powerful financial all benefiting All of this and clinical means segments. a on

rapid patients capabilities and on unifies a care and landscape including the solution, new health beyond ecosystem, those fragmented transformational solutions harmonized an be future rise that as and delivery Converge requires the will receive underpinning AI telehealth. moving empowers infrastructure system care. a ongoing language help as providers new ability offer exchange multi-model the ecosystem which a vision and digital analytics It's systems defining well Innovation stage. innovation into we from traditional are for natural truly is to hybrid a streamlines are embed all sidelines payers, and their that and of well With new modular addition, data, center expanding ways processing, meaningful infrastructure adopt that Converge, to to and functionality. the In supporting prioritize to a providers proofs health services

growing addressing more notice. TAM are and We complete a market the a is set with solution taking

our mission I'd highlight behind and like which year, to take sustainable, our revenue for aligned overall to key Now moment priorities of our a high-margin growth. achieving goal are couple a coming the of

We will complete Converge. of the build-out

final the demand traditional model. by in and system extends existing label effort will sales our investments will providers make that a focus digital customers final essential Converge us adds this With white distribution including Converge transformation large care platform high and the nearly enable will We and enablement beyond to complete complete, with customers. payers, that on-demand features the to be the XXXX and for in new capabilities. drive major migrate This

the helping adopt modularity elements our digital new solution flexibility customers some strive out expand for With that ability standard broadly hybrid our to new delivery, in innovative deploy of demonstrate the digital of and our also customers, will the of largest future. our care and health We of solution infrastructure solution we accelerating the use to to by set and our in are building practice the Converge care. elements market best apply our will

of our crucial elements share longitudinal and SilverCloud patients. carefully the allow Finally, health example mind at investments chosen give are to care leverage of of footprint customer and us to unique Converge view their our customers that digital to a deliver us forefront great and a Conversa the point landscape. of

and solution. internally balance strong to financial future to our further our promising M&A invest not us for to for our While us model differentiate achieve is sheet and growth and enable needed goals, externally

believe new installed we to With revenue, the we these customers, focus, top the and long-term our of base, grow that operating our higher-margin mix potential are priorities model. demonstrate well-positioned over expand time, of our in within add

Now and quarter, QX to our our financials on and the who metrics cover I turn plus some would Bob? XXXX like profitability. call will for to Bob, over the key path guidance to

Robert Shepardson

to call Thank outlook Today, XXXX fourth Path thanks, I'm conclude sharing Profitability quarter through XXXX, comments from initial for some framework. this key joining view Amwell's by you, results, evening. touch for the run everyone, metrics provide going to operating and our Ido, my and our our on on

review a XX,XXX few quarter and key measure in growth of in XX,XXX providers, and the customers. put to XX,XXX providers, context. non-AMG active XX% XX,XXX for year. the XX% on one adoption among try is to First, those ended our the which active our 'XX That's over metrics I like with Active platform specifically XQ third platform, were quarter would 'XX to in providers of relative non-AMG. We quarter and of for in of

visits. to Turning

at visits, XXXX XX% care. which as towards an were of As a about healthy ingrained Average the visits care success volume. we and must is more was part we X.X pandemic X.X expand of ACV, value and grew XX% acceptance value, longitudinal the visits our XX% more a of to were XXXX, health our continued care of plan have. flat good XXXX Scheduled as increased expected, our as Also, a ACV a average standard in view more increased of and real ACV rivaled and were XX% XXXX. during of long-term customers we or plans for and care, modest in year-end. XXXX. a million. $XXX,XXX our both and XXXX to for measure are virtual many in from declined behavioral, visits grew when expected a Converge which counts the a delivering virtual increase compared of annual virtual important customer strategy. AMG visit $XXX,XXX indicator as of time total Systems care, spot million health we health And closed systems strategy In visits versus transition. XXXX, $XXX,XXX relatively of became total XX% to of land this bright contract over to facilities Health to further saw saw quarter, XXXX, almost Specialty time across inclusive the

and and expect patients customer available are experience and half exited in our and with primarily on the for customer health for and We market full Converge We implemented to the XXXX the the recent Converge the once on Amwell features XX go both ACV bookings counts, of in Now, platform, providers. broadly customers live. systems, functionality second of year reaccelerate especially are entry-level

metric feature Converge have progress visits taking Converge migration approximately XX% of We deployed today key in would a at that customers like think customer we integrates EHR, on to demonstrates were place we scheduled A our on several also our highlight is year-end. our platform. which that of visits,

over was to normalizing the Again, customer M&A-driven our of XX% in the amount over of revenue QX of grew several in in small late calls, which in discussed expect have XQ growth of Conversa revenue the to prior versus course significantly pace Subscription we systems base, are now Normalizing a to XXXX. was The from revenue 'XX, of growth million follows: last third Total versus and for leading pandemic. compared And $XX.X XX%. go-lives Subscription on of fourth revenue QX We year. million increased QX 'XX the health churn growth XX% M&A-driven and results. components XX%. XQ as quarter, the with QX XQ to SilverCloud. revenue that for XXXX churn, for way. percentage rise reflecting influenced versus as QX by 'XX Visit primarily quarter quarter, to was revenue due be continues well to as $XX.X of in

XX% 'XX, revenue quarter, versus care QX in from visits $XX.X prior at average of visits to and Omicron for $XX were variant $XXX,XXX AMG the XQ For ago reflecting than in year, urgent example, million lower rise year last but 'XX. visit per visit the grew a $XX revenue in the XX%, quarters due of was in up quarter in up a

an market supporting business AMG element and strategy. clients, in to important the critical we view Our many and our as is Converge differentiator a of the our of offering

recurring we plus Converge said going platform, focus of of previously, services sales number high-margin to with have revenue drive As the our forward primary a like AMG. is associated modules and growing

Our services Carepoints on our revenue marketing being strength of engagement in with $XX.X timing campaigns to behalf grew by million, XX% the customers. the of driven

due visibility our Largely a gross strategies revenue In the have believe variable. As toward on remained a contribution marketing general, dependent to than business and up quarter at two points gross us in basis and the time was ramp great lower reminder, lift clients' our these and margin programs customer business, over campaign loyal as of aspects will are revenue stable footprint. are we Converge shift margins. XXX of higher Carepoints XX%. These margin our last provide deployments, we services

the first attributable that increased the quarter $XX.X full was mainly increase our ramped QX Conversa. SilverCloud in marketing expenses. increases contributing million the Sales support strategy, spending the last of spending average to Converge to QX million to from $XX.X in operating And QX Also year. and to of spending is an our million, and $XX in over R&D Turning approximately of also quarter to to per due acquisitions. we consolidating

We decline continue in begin as of Converge to increase spending expect half. half peaks, back 'XX R&D to first to the then the during

comments a Finally, I have few EBITDA on our profitability.

in Converge Conversa, $X.X This absorbed with the about As and million. represented $XX.X loss quarter adjusted rate a QX, view in EBITDA million was loss million short-term SilverCloud and and associated up we ended investments compared in investments. to costs sheet. and cash this and is temporary 'XX. with prioritize important of impacted, balance We We of Transitioning the the QX strategically. of as to $XXX our

aligned is Our consider that temporary balance the allows resources investing pursue healthy us opportunities and this are sheet with flexibility strategic and to and of us our provides the fund to period goals.

XXXX outlook. Turning now our to

For expect the to the to we million. of $XXX range in $XXX XXXX, full year million revenue be

revenue these care subscription we to Converge, and We programs to commentary from expect a at Amwell modest products flat automated our as our bump the focus core roughly in behavioral from on subscription subscription contributions migration and through continue health upside time Conversa, revenue revenue, acquisitions. our of plus SilverCloud consistent with

conservative also We around taking over flat at XXXX visits on X.X million expected million are with to paid volume largely a X.X visits. be view to

anticipate remain we XX% stable Carepoints prior expect to and revenue at revenue, similar seasonality We services and years. of to

and new the have live who COVID-related some challenges infrastructure XXXX adding some previously some their Our impacts waiting bookings, over platform, are revenue Converge on reflects but by up and to to half features including prioritizing a software that to our Ido set half, should timing we of platform. Converge the to healthy will bookings XXXX. talked are second about Combined strong we QX accelerating in the issues, the revenue transitioning for bookings year in with believe a begin convert second the to existing for systems outlook health who described delays or go order new on earlier completion Amwell, XXXX. exit chosen in of were These

Now our guidance on profitability. to on

are significant expect will the investments will are temporary success be making, us up to million. $XXX in strategic profitability XXXX, our year nature we are loss and full three Underlying set the for forward. $XXX going outlook which For of our million range in EBITDA we

of as the elevated cost the R&D Amwell during legacy the maintaining transition. platform First as investments well Converge-related the are

ensure services seamlessly is higher go Second success. spend the of and we to plan way pave on somewhat a level to migrations future customer Converge for

the is associated losses there acquisitions. consolidating Finally, the with of impact our

we investment be will we GAAP of behind and of can Importantly, growth. release. impacts non-GAAP period rest as of our press found us, guidance put nicely in all The to contain and we believe for our will future these positioned this XXXX, be profitable we

quarter to about infrastructure, Amwell health I'm from pleased page my Converge. completed Now that we as transition the begin additional CFO, longer-range have to telehealth we the from more here than as ever take I view to turn as delivery be first of our year some time I like platform of our to make legacy would to statement. income this commentary care our

to the the are earnings release you've Profitability Path had This providing will quarter, we of illustrate to and details. I'd your end briefly in to Framework. at like after to our graphic we welcome new take summarize, time the questions intended a

three the assumes items today percentage adjusted XX just temporary EBITDA margin points in we percentage impact that during points These additional guidance to XX model our our assumes by to of impacts lowered and XX Our XXXX. EBITDA described. an XXXX,

we will realized will XXXX. to we absolute and synergies acquisitions our spending compared to to basis expect to begin our look an XX% R&D by As on XXXX, XX% decline be integrated, to be

with further a behind that our us, and see of a XX-plus execution. XX% revenue margins visit EBITDA as This ongoing Carepoints and abating believe With our will growth services combine rooted revenue. shifting and that gross percent we resulting leverage adjusted temporary market we a will increase that the costs operating improvement subscription well statement margins our revenue as And with is there, over model approximately From EBITDA margin is helpful more higher-margin high-margin grow that's across $XXX our income mix XXXX while path context. in meaningfully an breakeven to it revenue, revenue, time revenue well and the some toward of out, rapidly in matter in in our is hope revenue. our path million we belief breakeven adjusted I see EBITDA than clear can firmly on in support visible to XX%. our an

with the our and continue we we Finally, to additional believe SaaS to our our to revenue. with our achieve plans detail provides us provide subscription This on intend profitable steady-state of vision, invest, lead for XX% level this to approximately today, we normalize market line R&D rate resources spending, you need companies sustainable into of some growth. investing in a of deliver at and R&D is

to good summarize. the made for final Ido to progress for strategic year working to I would well us, our which forward some back the Ido you investments remarks. handing I like Before towards look call in With we Ido? this one turn some call will all I to goals. journey. that, with on remarks, QX and as completed a of back for final important

Dr. Ido Schoenberg

Thank you, Bob.

We are opportunity and The proud large the and is our year of progress QX in us XXXX. full our front of team, of in clearly expanding.

and the of of digital-first by our questions, heart that want out at care Before strategies the your customers' I I end growth a call pointing take focus many is to on programs. hybrid summarize

to these our suited programs given vision differentiated optimally We in solution. are enable unique our

share for is is you country us. of digital that the representing promise is and meaningful we to for on of and your the installed this health over opportunity. vision largest will deliver and moving Converge the Thank a health connective X,XXX operating have our vision, deliver systems call and the XX,XXX on time. Q&A. care. and We tissue the substantial over and way payers the We the well in right our investments integrate Operator, making please in executing believe grounded is The open are hybrid on hospitals disparate providers. right well base from to required ours market towards the customer potential assets mind environments the

Operator

from comes line Instructions] Goldwasser first [Operator with Stanley. question Morgan of the Ricky Your

Ricky Goldwasser

road of the to profitability. revenue for Bob, So map you into thank through sort bridge targets of giving XXXX the

versus of to that are assumptions XX% think targets making you're to kind So start, going the of we as cadence. the in we about to just 'XX demand revenue sort see that additional how just underlying kind and assume business XXXX? pent-up above Just the we from to cadence 'XX? be helpful then of migration? about from by of what revenue Converge Should 'XX, gross expect in margin like And you're the to subscription terms of XX% growth mix think the should

Robert Shepardson

Ricky. Thanks, Yes.

thought when visits the margin of and margins -- really us as income talking growth. we it to would about for more the a on we're business, software think incrementally profit revenue for in of software how people important think, visit work the get look, XX%. bakes 'XX a it is revenue probably to 'XX, taking rate I Converge much and as 'XX mid-teens estimate of spend enterprise really So conservative about year, because going to would -- gross that higher growth mid- was I wouldn't there. rate give composite statement should this the benefits mid-XXs around of software composite this that XX% a business especially be growth profit call you to rate The you is business of that period on of XX%. meaningful growth with take getting the and assumption efficient EBITDA, 'XX. the in going it, And view high forward. it time, -- but and be with a think lower the would I of a impact and And over a for growth around XXs. the at the gross a, It's itself, into the

XX we're pickup from XXs opposed going margin that as from our pickup multiple to XXXX, one So well in now and from XXs Converge platform -- growth around just on on in disparate platforms substantial the the the low into the legacy. efficiency by running see gross is to rates

Ricky Goldwasser

seeing can state give sort Ido, you scheduled year, That's ago X.X from sort very prepared visits. to adoption in demand. Maybe steady and some follow-up question. one helpful. us context health talked of care your and towards saw new remarks, we move sort the fundamental X this that more And a urgent years about you're of and where the specialty visits you more just of

Dr. Ido Schoenberg

a see short to of such period in Ricky, how we far time. came is really it astounding

was of is transformation urgent rather collect the as service was focused analyze simple access efficiency, while are years, sense health It we the for it really some even really rest replaces it, technology a to What many improve in expand important it's systems, experience ways that also was urgent Very to patients. it own providers, care. really in power and only is time. care, care adjacent COVID, way and substitute, care a their ability days, care in digital other now have mainstream shortly in use that bring was entire not started, early in appropriate becoming modality many we case transforming But people so are mainstream That the a starting the video based some hard digital for bring with across which connectivity what and efficiency that democratizing but happened saw it very of players, in to the people health it's dramatic of continuously really own of whole conferencing in So a quickly that to much our because and starting an like to patients. but the the trusting of too long that with rise on integrate other between many a pandemic outcomes. rethink when simplistic with in sense really thereafter, in very is have in-room the discovered a care. efficient factors, care care that health the can technology important is care, other and is continuum, that that way to almost telehealth to not it an described, to contributing just but talk to much clients depths the I health and them work payers sideshow a discovered convenience of doctors the really our and for or of eventually the elements, allowing to an to necessary And doctor. the that to of communication very too health state a data care opens on opportunities of to dramatic plans participants more was the their the visit. efficient some also connection with and alternative And wait telehealth utilization and that

Operator

question Your with line Charles the comes of from next Rhyee Cowen.

Charles Rhyee

from you health to there Yes. other them highlighted systems have might this but just who to purchasing at you have obviously, clients -- number earlier, models some customers -- are Ido, Maybe maybe overall, or if what Converge be of will maybe Converge? impact that delayed over want raised at we to to year, of is selected look deploy clients for the are first. have, that say waiting how choosing reasons you hands to what And our many some to, least those someone transition migrating are Converge? not not why the

Dr. Ido Schoenberg

new Converge. single client receptivity many so the about that we hand ever upgrade Well, it's better pressed the platform hoped. raising us about strongly that hard refuses I'm easy to think than upgrade. the their And to for very to much Charles, to the is waiting for think are to

that. do that course, of issue factor modules and with key the clients of timing And the Bob to on depending mentioned is that driving of excited client. very the availability really together it the the Our each various needs the every complexity are and is

behind will clients. end that across ecosystem be point entire our all by year the So us the I'd this will when like available all to of be functionality the the to spectrum out of

Charles Rhyee

what I and Or realized? you shift as I'm the just to improved it follow-up, part visibility this I big things, services really bucket. get that slide impact. you at could factors. subscription bucket And all highlighted getting the question you to that's dramatically, the the And spend Okay. Bob, Converge loss a the that EBITDA that when assuming in to core of mix as the That's three improvement? is, a Is guess this right, we else of kind here, look the revenue? maybe contributing of impact, helpful. clients support I And just have know the really But M&A obviously, be more number what's

Robert Shepardson

Look, Charles. XX% it is item, to chunk line a decline XX% of 'XX. what visibility big lot to to in R&D expect the that I we we by spend on which in mentioned Thanks, on, which have is a 'XX relative the of

in a in or on growth it's mix from the look subscription decrease would just you of a more that's million of of if somewhere they improvements -- end from in modest what those the estimates visits. R&D. benefit then low shift on faster a profit And impact it's two the year-over-year gross my a But items So on from at deliver, versus increase $XXX cost. from from dramatic terms to two, basis $XXX and the million

if you walk and in to think EBITDA and that, million achieve of that from negative million about from of $XXX in expect so can that call negative it, XXXX of terms margin that take delta the itself around in we off huge $XXX a is negative of, think And we we XX%. the going midpoint of XX% around guidance the

and other the as to operating some are well. as items leverage we the those would see, biggest said, expect So two I components, across

Operator

with line Cindy of Goldman next Your question comes Motz Sachs. from the

Cindy Motz

in R&D, I finding said asking in it ramp -- you Omicron bit it that little I are to people people you for distraction. visits, an I like about know on I are said But -- -- had excited with with just number. But asked R&D complexity? up thought in about seem maybe But to are the unexpected and on want be terms go delays about curious little a happy the it being variants more that. asking you you of of of because Converge follow they migration. really more And that color get idea of to trying down. to it. a and because or is terms just Just would some maybe it there know would things be maybe just more the and may for. And what think

Dr. Ido Schoenberg

answer try Cindy, asked many fully. you I'll things. to

saw Omicron that in One, that view the mentioned are earlier, really unpredictable. last The the that two does we mentioned One XXXX. of And you really I our is things year. the quarters we As things. two it's influencing saw dynamics. Omicron dynamics two to

we for was the on unexpected demand the surprise. be into and able separation help care to based our a view example, For urgent between that. conservatively year adjusted And

ability despite project second hospitals our full that and element much impacted implement the Omicron, relaxed, the the overall existing during the that some that population to of fact were ones. The a clients extend new of more was was or

enterprise thing grew Another realized. large about much QX. of I the than bookings is we appetite very platform talked that for the happened faster

in very We happening choosing the organizations some the largest, Converge. of proud most market, sophisticated of are what's are

but they in really decade deployment when scale, longer, such about care the healthy it in answers make far is our together your such span acceleration short-term And a market only even than the that we delivery The multiyear a can As in you digital didn't you we plan, the some Such and continue believe on the investment for you that or question. some order and But with that our more years it's integration and it cycle really enthusiasm very signifies we developed beyond that that and much go way in in clients far cycle sales us. such for platform securing much think is worth pressed that after potential we to we end sheet the more the with year years. lucrative deploy I very original we sticky. sought deployment hope significant begin growth of negotiate more deal usually and more to well with today. to shared growth there, accelerate is can and roadmap. them began We for because far also is longer. leverage to imagine, five really broader, far clients, when a going are it's clients so much expand also to balance upside When of for the relationship many hard very or still capable what planned, focus us in differentiated plan. originally way our

Cindy Motz

us makes XXXX. you we would just be Converge help out terms don't know impact. quarterly any on for that the the it about I start Like, a see -- broke give is back-ended No, adjusted -- great give is that with as could if I EBITDA sense. know sure. there we assume or to you would follow-up, -- That but improvement How it guidance, of more just XXXX? And think it in you I cadence, should

Robert Shepardson

that would to Sure. think line we saw top say, be Cindy, I about in seasonality, overall, what similar the in should if you our think XXXX. quarterly 'XX we breakup

to see top Ido half back live would fourth and start Qualitatively, the back half that year, on to that a about, through continue quarter we to fourth of some we the I go saw ramp the implemented from and expect to to on subscription year. quarter tail off first the of half revenues in be to of bookings going perspective, once the would kind start line. the as From then those. side, the that's see the generate talked R&D you're number in we of say So cost

are, M&A really those items down don't I the ramp-up going quarterly to and there. in loss The driver there. of the much think, on differential big be think way really I From then there subsequent is so an side cost ramp important in perspective, And most the R&D. the the will line really two be

Operator

Jefferies. comes question next line Glen from of Your Santangelo with the

Glen Santangelo

telehealth the Ido, physicians to your kind of exclusive in I the their competitive competitive how using second sounds on evolving XX,XXX are arms It in comment go of that overall back currently terms seeing in to prepared those the are the get maybe the sort you like what trying respect your nature because may just relationships? landscape is of that around some be question what of you're my into really more you could for you to comments mentioned platform, think made I remarks with of Bob. that leads want landscape. investors to broadly

algorithm we bit out of catch-up. as forecasting in bigger year of of XXXX. growth understand through bit probably confidence I a you maybe probably you mid-XXs will what move revenue you the You're think XXXX in little a and a gives upsell And the rates model little play be them of one that revenue attached clients subscription these Just Converge? could growth of Can once how 'XX you 'XX? general any like questions. to works through the and thoughts in those talk to more around convert you maybe And charge is the an you But year transition there it? those

would of kind question, is but thoughts this a Sorry, be any appreciated. long

Dr. Ido Schoenberg

one Sure, take second. Glenn. the take Bob I'll the and first let

similar. would simple Zoom and other Teams list really the the, the and necessarily And it's very The the we're are landscape, are to very a see there. And end, lot playing. relates it known say, where with of There not important. are case, Epic that's products that many As two trends a And market end, use is that really is I for connectivity. issue. it's seeing you competitive low simple a big definitely and of we see competition players to long type difficult differentiate. Price of crowded

our and integration X,XXX simple large you for that, In care and sophisticated and simple most as that non-AMG. well are various require differentiate. as are becoming more that beyond indicator we all bigger almost part our more use we connectivity our more the saw not services network. things a number growth in I providers are, of our we an And It's confident well you client's within the you very traction hospital beyond them clients. providers. of that a with things, The urgent many are, number that of provide are the is our more our The they addition are for workflow sophisticated and value what of things modules. platform and mostly looking earlier. to described These connectivity, is our really seeing mentioned growing earlier, adopted active are to of customers These providing are I

is task. well actually Although a simple connectivity also for received Amwell now very

don't right digital what become answer grow as a some not clients And second one client secure don't I'm think our that by one far the things not having any have resolved see with These you of As usual of video infrastructure uncommon what because has of few compete, although, simple about the don't part. call an doesn't to nature, that take situation, over other. delivery Bob two Amwell when using and I'll quite we an having theory, But is of recalling now, unless care the M&A they essentially we platform someday. feel offer of platform, and platform come And or like we power the It -- it multiple much actually provide. make there of that They eventually let ours could connected near is for they in that exclusivity, sense platform. typically you we those. needs. to one connectivity have

Robert Shepardson

to to here. look the I so Ido address of guess of it, some to of at part ways your But what billion and couple least on for TAM Glen, I we and TAM But it. address in looking I'm second there aspects strategy lot a market, where little know a see, conservative land-and-expand -- a to certainly our part that, about we XXX question. fatigue we larger, the are the at out going at some of also of at our the this ample brethren we our of we sensitivity there's $XX got have out But investors. upsell. growth, there let of structure there. But have as vision we with we've that a XXX, And may a buyers usage the sophisticated as are more in, bit there that across have we're some the estimate. multi-silo especially opportunities -- have underpinning be once volume way contracts, of lot think we

the over sense, kind our closer probably few that, bookings next software that or are are XX-XX, a year like you that Over right our customers in I between last give and expect we from are upsell. upsells. the to mean, gets something I we time, now. XX% bookings two of split, to would So and where estimate bookings new of years,

of hybrid at much doesn't doesn't heroic. you going to we're will customers in And innings think that subscriptions line still modes the so -- over evolution of our delivery they about rate and too seem early offerings about the have to see think are the to a types mid-XXs going we we're you of and care when TAM the evolve nature in -- this could think the seem it and grow top become how we that time, the more like software we think in very their service that's

Operator

from next with Percher the question comes of line Research. Your Nephron Eric

Eric Percher

the trend. SilverCloud Question think I 'XX, end would helpful. as organization reminder to on speak of know and you overall a the behavior just for a Could how is 'XX? be impactful we decoupling to of on COVID. behavioral expectations for discussion I from your there's been expectations some

Dr. Ido Schoenberg

Eric. Absolutely,

do on type selling in is hope services using ourselves, our elements the to everis spoke a care So really our when on was much and but way, available everything the elements physical, more paid than driving are and topic services I really virtual either way, automated that done a sense I market need proven services SilverCloud in much for job. there doing NHS an or visits broader enormous they the longitudinal for not about and I by and the inject other Health rather a part those therapies by efficient serve to so in to opportunity program are in better to unmet providers of the types With broader in to ecosystem revenue and really doing helpful. that the connecting each the to in years are efficient focusing with And have I platform. outcomes results, that promised part and that's we collaboration therapy care other of scale, ever very the we the our requires are in very market U.K. the really the elements that many extracting think achieve much you many the variable mentioned can When with really therapy much available by that Ever want the urgent Converge, is behavioral, out of clients health able connecting as ability a about example unified go in point to amplifying of ahead [Technical now what is every AMG a combining Difficulty] alone is of business. chronic a really program.

Eric Percher

the be, going a down, would also in -- was there system here sunsetting I that is 'XX, that early R&D my metric 'XX? of as behavioral? to second be legacy And ramp guess, there I the an the as And percentage to there relative of visits question are is question expectation 'XX,

Dr. Ido Schoenberg

The answer with is absolutely yes. the start end. I'll

We not have systems. it's note important maybe to -- but that [indiscernible] it's they're system, legacy a

we totally and of visit a to single health, quite automated for behavioral few does out a lot be in a that point is to example, care, require order answer. running CBT, is health health definitely parallel, behavioral like complete all my and are Bob And even not I'll have We I'd them. visit effective. to maybe let in systems planning of one sunset facet also of behavior

Robert Shepardson

we're going I decisions blended our how just have exactly across impact in the on or whether going you'll don't in KPIs, report see made yet SilverCloud, we forward for to think another ACV way. Eric, instance,

really guess, per a way revenue, right side, can visit in we've the you now on And revenue average put the is that. I again, think So I don't see that SilverCloud impact pin its visit. on

we're you probably that's I'll So not something keep posted, address time to but this going next year. maybe until

Operator

Fargo. question Stan Wells Your Berenshteyn of next from comes the with line

Stan Berenshteyn

question Cerner. of I'd like here. guess, to a ask Maybe I a on Oracle two-parter the acquisition

any related with Cerner? would that Cerner has this systems merger your for maybe currently great. expectations on this that your buying to are goes And in deal after behavior What comment change level. high maybe be way first, the using So Any strategic that, then of through? are health partnership

Dr. Ido Schoenberg

Sure.

or the from related I clients joint don't any pushback acquisition. to Amwell-Cerner So recall clients, otherwise

We also at far. Cerner, least relationship so our didn't notice with not any change in

know, As many you common clients. we have

complement and each those Cerner We that's for are well other clients are both integrated, great And happy. and We Amwell. well.

with initial is -- very initial the dialogue positive. Our Oracle

why believe this the growth. continue will in So not to we have no relationship reason

Stan Berenshteyn

care. last called are are of you ground are health I'm then quarter. something whatever a clients? sales it. to HIMSS survey adoption in terms that made helpful. it on where Is systems capabilities also, Got type as this want to go speaking actually It already or their your what to without in just systems health was is longer planning systems to virtual health your is, hearing? meaningful growing through a of any invest to beyond communicating you're of expectations, back by or And the it. reps reference Or that from you in Got Zoom that term. comment they That's have I out commentary XX% curious

Dr. Ido Schoenberg

Yes.

would are with a So we on lot I of of are there course, related, the we is the that And decline. One that the pandemic-related are clients. suggest time two COVID definitely see. things visits spending the

was hospital and the where that don't entities will side, and a without those change the thinking be rest out wins and that is on are nobody value platform see patients from distribution otherwise, connect with about EHR. really with about So in envelope has of do before. of have quick an the the a where didn't are even leaders the changed digital digital there is it care solution. really did future to But they a the the the a an trying the And of enterprise-grade growingly, EHR. is connectivity it's there, imagine an driving it ecosystem their because dialogue siege connect from patients sure necessity to differently, the in participate I'm not enormous customers, reach that because to definitely enabled hospital time our our now relationship to pretty Saying that how with based connecting really thinking smaller connect not they're flip discovery on by a traction. can't with organizations the dialogue of really going seeing digital patients digitally of

Operator

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

Allen Lutz

there revenue And the businesses still from I then for you and quarter? was XXXX? Conversa those revenue how in to in double do guess, SilverCloud much expect

Robert Shepardson

-- Thanks, is see. M&A the guidance Conversa, and We still the on very we to Allen. call expect SilverCloud we much gave on what

quarter. we're integration historically revenues in and will on is kind going tell So here. of cross-sell you, to or $XX moving kind of of of the forward number the for and of The million perspective, aggregate single-digit And two seeing of base ways synergies. I the we're -- line. their it terrific forward the forward very them to them into both looking two really minimum in opportunity a out was acquisitions lot breaking not base. a our small out And just around from a realizing what these a we're top

Allen Lutz

it growth? And I health think I health due and across another systems guess one about to of module in you increase new you. ACV how that The plans for was talk helpful. was can much of guess, you Converge do due to you growth next to was years. within just over if any And think price about about, the a price? how few think as then If lever I

Robert Shepardson

call price. it wouldn't I

that New was really structuring I movement really of and modules more right? plans. we way and volume-based on meaningful saw adoption would the some we're it. just only it's really think triggers those be contracts health into these and I side, And upsell, way about the the plan more is thinking programs

I little flatter. those that's So I the working well, side. expected to And were the plan side. headwinds and a health why that's, systems as as the I seen numbers on think, about talked on we've of some that referred

Operator

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

David Larsen

XQ? to I that by And XXX% enable to that's 'XX XQ XX% think going XXXX? you the Converge all what of how mentioned the Will XX% or what's should XXXX? at in Was have that -- of visits in over are percentage then be course it on trend now? like about savings you and visits you of R&D

Robert Shepardson

the lips the XX% don't think Your so I at was December. But in of God's end ears. to It call it year, so.

all look, of control expect we We -- don't that.

that resources make allow to us and conversions on dedicating and having those of customers the Some our time to migrations. the dependent is

what meaningfully end. rise reporting I as year the target the to year now I that goes expect a give we'll course We hesitate year. be you And over that on, of is. the right number to think certainly for

plans after with We then on work our first. health we'll health to that. our move migrating And are systems starting

XXX% because won't on the expect So by the But to comment? share the have not year. our the we of immediately. want taking end you we really the to for health XXX% do visits working Converge systems place maybe have Ido, we're on of lion's certainly

Dr. Ido Schoenberg

this year. then be win year. essence, of share during everything we absolutely. way end mean, first market in need half half. towards second and R&D the entire even Yes, in the I But And there and the it to will the of our a in capability completing

upgrade mentioned very to earlier, Converge really I People is As the very, to want for Converge. high. demand

As their a reminder, it's license. included in

So do that. no barrier there to is financial

that programs it from there of from exactly deployed. new for be platform needs the many an We're expect sense the on time-related barrier it's operational the However, to have to Bob feel going efficiencies share science, we prioritized so and and not opportunities is an But the We towards really going going our to the models platform, importantly, to, more brings. customers that exact lion's only course, in 'XX, it's we how it's the fully difficult on expansion out. are some our mentioned, not although predict platform. linger to but it much of as and of existing to fall then benefit the sense great to that Converge,

David Larsen

one Okay. more And just then quick one.

versus what With customers. Any certain you're of could revenue acquired your it be plenty assets of of seems focusing areas that growth, to annual that the organic lot view? a will like on? your portion And add value in that there's XX%

Robert Shepardson

Yes. are terrific That model. degree would finding and we incremental Conversa, would that assets be upside successful all revenue in SilverCloud as as be in that this to the

Operator

Your Jailendra Suisse. with Singh the Credit question of line comes from next

Jailendra Singh

lot have in to your virtual wanted vendors other health a and been get from care I activity of thoughts seeing area. virtual on actually plans we opportunities care primary that

is to guidance that in product projections? as a trying traction long-term How understand as what of big your guys have 'XX your you revenue seeing? well component Just been

Dr. Ido Schoenberg

the patients is digital first. care question. to is with of going part certainly a online the system going heart health That's really Virtual of of Jailendra, and always are interact assumption Primary that's part great first. almost by care that It's the Converge.

that care successfully the selling So remember. is Converge. market introduced on it as you Converge. of it's We're We don't built. Converge now not we in it's a to product an use year, any it very core. as we think part last in not We future. care that I part type any of client That's of capability. And digital almost think the primary as virtual essential expect the that way delivery see

product. as not to a report going are We any separate

Jailendra Singh

long-term providers. telehealth providers the around telehealth follow-up despite clarity on with telehealth among once environment what the to providers. the just And exploration might emergency reimbursement bipartisan adoption the reflected country support have for your reimbursement are my reimbursement is Clearly, in Okay. next of environment on million understand then and respect or it over, growth still is trying across to public in for outlook the $XXX health that in post-pandemic waiting telehealth leg and of implications on

Dr. Ido Schoenberg

Yes.

estimate it's So change very of speed difficult the size the to the and change. of the

free-for-value of value-based change drive difficult model. It's functions that relevant and type to free that fee-for-service way fee-for-value. As modules such, many reimbursement. a we the is understand and you're unrelated efficiency to our for are use all really becoming to When organizations, the very Converge many organization, -- of assumptions Amwell fairly drive in any to cases, conservative between that also for very, in

you're bring way environment. to or in be able people in specialists points good in different even to the If healthy care, to of a that's ER process reimbursement different better to readmission, your very avoid therapies

the would purpose really is improve the main I of efficiency of So outcome. financial care, and Converge say that improve clinical

rightfully exactly but mentioned, to more for if play is to you therapeutics not enough going see, to as lot begin fuel fire. direct that's also the going digital virtual of going put there's certainly guess visits, to for out. this to which But how not we course, in a smart are Of reimbursement, we be only

I that all. because proof suggest it's that end much reimbursing certainly, almost selling so Although up we only likely so different and that believe virtual are -- will there that points the government would so many is the interventions much financing payers, that

Operator

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

Jessica Tassan

purchases bit Can SilverCloud how build, per or whether Conversa. or Conversa kind maybe and enterprise subscription just are to streams per they're remind you and us wanted I and follow of month? build SilverCloud So are little guys contracts up PMPM a on XXX% revenue they SaaS

Robert Shepardson

bit and All it and size, of virtually is and revenue perspective. average revenue say, little a Conversa And in size from They we subscription revenue. all customer, a characterize it customer different ACV, from a category. revenue. that the would -- customer similar. I be revenue would system still health subscription per our very is type have primarily SilverCloud, a should subscription as

how thinking So that's be categorizing I'd about them.

Jessica Tassan

this virtual triage solution a about as help offerings the competitively within it Conversa you market? the follow-up, What other of is kind integrated Converge? us just value And how the propositions? then kind is can are And helpful. some really That's to differentiated key think when of specifically, understand on quick of relative we

Dr. Ido Schoenberg

doesn't really as count core Conversa our to become Converge. It implemented The offerings. going it It's the such. one like of I'll is but of question, really treat being as part

as prepared As we the of to XXX as part that be over of in care have that, workflows primary and different experience certain course, virtual well. my were automate tried tested or in I can described programs mentioned scenarios other remarks,

its is the It a actual but it's of Conversa used other only programs, very powerful that differentiation open nature. to provides a the not programs offering. as Some tool is of

of some organization. programs, new and programs And your can them exist amend needs programs altogether. take we the So cases, to in create that

is to that strong that really every that's a very that how of that the customer. about a managed, should need of is especially very should clients, customized is how there nature. litigation, ones, library many So things the has triage And be ever steerage of opinion and be our bigger expanding for managed, important workflow

Operator

Thank call. time. you This concludes joining. There at conference are today's questions for further no this

You disconnect. may now

American Well (AMWL) 25 Feb 222021 Q4 Earnings call transcript