PGNY - Earnings call transcript Q4 2020

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Operator

Good afternoon ladies and gentlemen and welcome to the Progyny's Fourth Quarter 2020 Earnings Call. At this time, all participants have been placed in a listen-only mode. Then the floor will be questions and comments following the presentation. It is now my pleasure to turn the floor over to your host, James Hart. Sir, the floor is yours.

James Hart

good and Katherine you, afternoon, everyone. Thank our to fourth quarter call. conference Welcome today With President CEO of and David Progyny; Schlanger, and me Livingston, are Mark and CFO. COO; Pete Anevski,

open with remarks some We for will before begin we questions. your the prepared call

other member press like forward-looking limited The statements our we growth, and not related term quarter issued that outlook, acquire strategy, today's plans long including statements assumptions, These and non-historical and financial release of the business this further those impact first about growth, on our afternoon. activity full remind call outlook, and Before and market investment to clients, retain general statements our you market XXXX. in forward-looking opportunity, described of operations, contains COVID-XX risks, ability that corporate performance, business, as expectation clients governance certain uncertainties I'd economic including and new statements, was opportunities for Progyny's conditions. existing year and our begin, plans, business to our future are industry objectives, our but industry clients, financial to subject to size and outlook to and

on We affect about that have we results operations. these our and of our forward-looking believe business, and financial current largely based expectations projections may events and statements future trends financial condition

Risk filed in discussed current these most materially our changes differ after expectations we occur risks are with no the any Factors undertake periodic SEC, recent reflect actual could other these our reports from to XX-Q. obligation these cause reasonable, believe to the results in are revise including we call. that that in Descriptions and section Although statements this entitled statements and of forward-looking to

as in release, call adjusted During the like share available refer over to income which also net available at most investors.progyny.com. measures as such call, turn adjusted, will now non-GAAP adjusted press I income as David. to per the Reconciliations comparable also GAAP adjusted. with are would margin, measures EBITDA EBITDA, net the financial we is to

David Schlanger

thank will over to cash this where you, you the operating flow. quarter financials just levels had a us in joining achieved and year record to profitability, quarter, of Mark with performance a but greater the We're Jamie few the to Thank that revenue, you highest take pleased I'd period. for in we ago moments, highlights. strong detail the year fourth grew In of fourth we begin XX% of concluding report revenue everyone, few the another afternoon. and a like

quarterly revenue We also $XXX surpass our in million time in for first the history.

revenue pandemic. the to despite achieve grew For QX impact our result severe in this because full-year, volumes the strong of We XX%. the

created our facing and the new delivered and to diversity headcount. the support our and care, XXXX the add to are clients operation. in global that unprecedented realized number EBITDA XX% and average record generated to significant against lives, XXXX sensitive our quarter of our $XX a cases including in crisis finally, and million factors increased customer of managing sequentially essential increased $XX.X to combination the quarter XXX,XXX the an XX.X% The COVID XXXX. these pandemic. covered health efficiencies are were treatments flourishing fourth with third members fertility impacts continuing the in to of we a achieved quality of increased of nature scale members by pursuit during we or in the to from margin the time of network resilience of our that majority operating successfully significant gross we our demonstrating member by Our continue cash and the confirming And due flow backdrop of base as results the of challenges base the along the their provider who strength are nearly million, Adjusted also in we of

our support As promoter we've in enjoyed and given questions and a training our rates. journeys. our successfully solutions, response, we guidance the providing of due support to most and have that fertility member to members investments that how concerns. scores uncertainties members year measures number pandemic, At relates result and the COVID-XX. our net to to our consistently including for reflecting a need heightened of support significant an greater the our satisfaction members for industry-leading and we've last address made one navigate Progyny, took significant the members both had the to our fertility even continued emotional their pharmacy improvement recognized stresses PCAs we've need In education, Throughout accomplishments COVID-related resources they in of with specific

their extremely their we will a workforce industries, shortly. dozen willingness These but mental offer. maternal of as cross any services future, as its looking clients than well believe as during the represent our We've for The our XX health also clients previously In ways highest produced them We are result recently score our in series to size. with relationships two the of that section of Progyny community. to our enthusiastic issues clients, leaders even issues different healthcare for see enhance are very XXXX, of provide subjects always unique our believe with to our we Pete from geographies our only members, to ever. be has an our telehealth problems resource well-being also the to of this clients of the rates that at importance during on of the To this been Progyny level and XX, to understanding Council. increased our reflects a evolving launched webinars response these health the virtually them. becoming us that other insights, strong retention are present And our that satisfaction is some believe important Partner with all relevant deepen and accepting including Advisory as well. where fertility join diverse invited as which their Advisory and by support to of will most objective, more partner fertility in more to ways the information the explore finding fertility journey, including treatment, pertaining client not of expanding solutions address our helpful success and benefits response teams By relationship, discussed in the services and in confronting. financial MPS understanding we value clients for high timely we members in we Council We as black use of the metrics. We

of or importance to the the This from One in address commitment to things their for Equity, impactful Inclusion tangible customers to hearing particularly heightened ways is for we've workplace. provides given companies their DEI. Diversity, DEI them that demonstrate Progyny solution been is our for

to whether single First, their it's because of member equal member has individual because they of every mother issue, Progyny are needing plus a care, a or fertility by access regardless medical of treatment, community or choice. LGBTQ reasons for the

diverse that knowledgeable of our traditional plan plus who a culturally competent unique members is full they and genetic be of need, treat population, one's of design doctors based specific to every this finally, may LGBTQ a designs. by the well screening the flexibility treatments eliminates as such including cell may to communities. on We or unique mono highly PCA access patients by like trained covering from BIPOC, about as sickle personalized, members the receives discriminatory And Progyny impact giving plan all disorders sensitive needs and each genetic situation, care certain procedures populations. accomplish to to Second, the the as for

cycle leading class and ensures all been proprietary need. that race network our a equal they patients to recently in fact, that the bias, because doctor eliminated Progyny's all In have said treatments access has smart it

while themselves distinguish As of believe our DEI, for to companies well higher ESG their a our importance improved superior their to providing our will both in ability retention. and and a given both and look the outcomes, this our better we clear increasingly satisfaction relevance help proven tailwind solution, manage companies as on as through leaders ways investment further as become return costs, employee growth, to also

to the Mark? turn to quarter. the Let over through Mark now me walk you call

Mark Livingston

and the fourth In by full through results, you walking fourth grew XXXX quarter you, for our revenue expectations afternoon David, year and to begin XXXX. good our quarter everyone. $XXX.X I'll and Thank XX% then provide million.

million quarter to our As revenue. we David mentioned exceeded only ago. first into was was a perspective, where order to the this a year half in first $XX put million $XXX that and And

million For $XXX.X full XX%. year increased of the revenue

full fourth components in Turning quarter the $XXX.X to XX% million. line. the year increased the increased to Medical XX% revenue top the $XX.X million to and of over

previously lies, the year and most second clients XXX% both the Our the offset quarter increased our significantly temporarily fertility pandemic. reported by fourth growth year for medical to utilization, number when of at covered was driven revenue revenue to and onset was revenue quarter higher our and partially of closed million. the in Pharmacy the quarter the $XX.X lower full clinics in were by though

increased $XX.X clients increase driven number pharmacy by revenue primarily full in to the Over The the a the as ago. was compared XXX% year, year who pharmacy benefit, the of to RX have revenue million. in growth

XXXX, took year. benefit. We our continue to then and In launching now this That new to today clients year. Of clients XX% have RX. integrated the the of are RX XX% the Progyny XX% each XXXX all increased the Progyny benefit clients in more taking season, to see clients selling of newest XX% the that

progression of client opportunity upsell there future than While, pleased years, we of adoption remains past quarter with very over to base. few the are the more pharmacy the a

This XXX XX% during clients, more quarter average the over about in compared XX last end lives As year, average covered lives the the of the the past quarter. fourth an of reflecting of an X.X than had in of million representing X.X covered covered year. million clients, to and we lives growth quarter,

as in our to both XXXX. as existing well growth client in growth continue lives whom workforce covered their of came many our through within organic additions, expand base, client Importantly,

to metrics. now our utilization Turning

increase X,XXX to reflecting the During the XXXX. quarter a quarter fourth ART were performed, XX% compared Cycles of as

Female undergoes fertility significant Cycles full that our reflects the ago. though clinics X.XX% quarter, financial period grew new results, drives partner treatment that a XX% really when given cycles. of the for the this growth X.XX% stopped aspects year, to which utilization as year female compared of temporarily year most again, the was For the ART initiating rate time

The female X.XX%, and to compared utilization start For XXXX. of which pandemic the care our X.XX% in XXXX, the the X.XX% members impacted the full in XXXX, rates. year at was temporary to disruption to utilization full year access

sensitivity rate This recovery year. our prior the for versus fertility However, most a has I nature the returned to moment by time treatments, reinforces mentioned as as of QX patients. female ago as comparable well both its levels utilization essential

utilization As mix rates newest a when clients. due reminder, a the the including live, clients of to of the the timing of year time factors, new number demographic can vary go and of

now XX% to of $XX.X our Profit million. the increased from fourth margins. XXXX Turning to Gross quarter

XXX margin last quarter As fourth the a gross this result, year. an of quarter basis our points from reflects increase XX.X% of

to normally done at normal services, In QX of was management addition approve in -- our favorable the XXXX part year of improvement end. in operating true-ups related part to leverage the care IBNR

year full that fourth to gross million reasons for XX% the revenue the growth profit our in drove For $XX.X the same increased quarter.

the XXXX, reflected an of basis XX margin increase points margin in gross XXXX. from XX.X% in of Our XX.X%

the which for ASU our though doubtful a to table today's We've accounting pertains quarter, he a now losses as noting will of your that conform to fourth the provided line in reconciliation allow by compared historical adopted give the expenses. to year Sales was ago. by allowance operating affected item I'll Marketing fourth our you the to Topic each results. you models quarter quarter, and X% which was to begin in of a a the X.X% quarter ASU and as release press result XXX, of for expense accounts. credit to XXX revenue during of Turning fourth

basis of was XX point from the full and year marketing reflecting X.X% XXXX. an revenue, For improvement sales

sales our As realized savings a shifting events year of we enrollment certain amount and virtual. this from open activity to in-person reminder, a by

that continue leverage sales recurring we our operating we we significant near each XXX% is addition, see within our to stream. retention revenue marketing effectively year-to-year utilization from client rate see what client, functions. In benefit a and persistent and With in the

long stream, majority client expand. Progyny this the as XX.X% With a margins resulted to and minor to our of thereafter acquisition million due a the legal and compared standing vendor, increase costs the which variable revenue in term year quarter, This fees. a settlement to with first incurred will the costs quarter associated primarily the in in being in launches this expense quarter XX.X% with G&A with costs of $X.X arbitration is were resolution particular continue year revenue fourth long during ago. a

in the connection As incurred with reflecting has up a we our been in that step as XXXX our year cost company. first G&A reminder, one in a time public

quarter, basis like-for-like are However we periods. comparing given in are company expenses that on now public the fourth with effective a quarters both

incurred As of G&A this costs revenue we reflecting arbitration, a periods, fourth nature in result a grow both related as G&A the with margins company public to on revenues. percentage inherent costs excluding was in quarter of XXXX our X.X%, the as of expanding the but

XX.X% XX.X% as compared the was in revenue For full to year of G&A XXXX.

incurred XXXX, were reflecting of throughout or cost but revenue public arbitration in of increase XXXX, XXXX. only XXX expenses from a basis for of XXXX, company was the G&A periods that points the portion an Excluding from XX.X% both

adjusted Given expansion and from a point across year. XX.X% ago the more Adjusted EBITDA in fourth the $X.X both the a quarter million to year quarter, fourth our XXX improvements increased basis period. margin ago In the quarter, the margin in of than EBITDA $XX.X reflected the significantly million. EBITDA year adjusted business, from tripled

quarter EBITDA year, business. related despite and up primarily giving pandemic XXXX, the our impact incremental or XX% the step forward new basis first points was expenses business fourth capture income of $X.XX per expanding margin to an share is on adjusted $XX.X on year public per million, due indicator our For operating its share. $XX.X across margin XXXX. company. Net in to or fourth XXXX, a the a primarily Adjusted as believe where of moving, revenue the loss reflected We XX.X% This income was to for incremental XXXX, incremental reflecting leverage in in on XXX $X.XX of the the net in in EBITDA and higher factors. net compared was full a of X.X% the results. from of The revenue to grew expansion in rate full of increase is to capable improvement year the million Adjusted our or $X.X in as million two margin EBITDA revenue highlights our $X.X after effect useful quarter revenue. this improved million margin

million to in period. in the or $X.XX or in income quarter net periods the expense that This XXXX. related costs tax the tax second, $X.X with compared was of periods of valuation tax $X.X million settlement legal now XXXX a the we a between reflect share per all million $X.XX we've assets ago evidence fourth the in convertible adjustment reflect release the realizable, and sufficient our net is compared a the results improvement income fourth as to adjustment as adjusted our in year And adjusted tax the recorded have on quarter First, To million benefit XXXX. connection valuation XXXX XXXX. both in The stock as of million warrant due adjusted our net $X.XX that to to business income improved warrant given the In previously This are preferred or ease comparative as XXXX. across as the ability of share share. the per deferred $XX net share that I've valuation well per per operating benefit deferred in adjusted in $XX.X to the prior allowance efficiencies And to existed income discussed. assets. $X.XX or that was $XX.X as in warrants IPO. and the share of exclusion XXXX, results the

cash our balance flow. to sheet now Turning and

an and September balance marketable from securities, cash had As we million at of $XXX.X of $X.X our million of December XX. cash increase XX,

to as XX, of operating which fourth in have reflects of increase increase the In we cash million, The $X.X we our activities cash from $X million compares $X.X of of quarterly capital used of debt. addition, quarter $XXX.X operating September million by position had cash in December working approximately million, positive no XXXX. flow and an XX, in

the significant due quarterly collections year, cash The improvement the and reflects used the quarterly million million For full in both on provided of by operations as XXXX in flows. improvement flow in as well profitability, primarily our to from $XX.X cash the a of cash in was $X.X higher full timing XXXX. billing operations by year cash and

we protocols with been consistent that assumes Turning now first seen for It of fairly quarter level consistent. summer. last our period, in during since Accordingly, year that to our guidance expectations activity XXXX. has clinics two their COVID-XX member the And we've been and member has safety activity activity over full since stays seeing the with our reopen have quarters place. been

the revenue were growth quarter between to of between XX%. reflecting first projecting $XXX of For XXXX, million, and million we XX% $XXX of

$XX $X.X adjusted income $X.XX $XX.X EBITDA of basis per and between along with million of million million to share, $X.X we between $XXX approximately between fully of shares. For net a basis the million, to on expect million diluted $X.XX earnings or

we between $XXX project XX%. million, revenue between reflecting XXXX, to million and be For to $XXX XX% growth

margin adjusted For million between $XXX we between million our we're million share for revenue shares. $XX on the expecting continued or of income million, between of $X.XX XXXX expansion approximately $X.XX of XX.X%. net midpoint to to to per and see expect $XX.X earnings million, margins fully of this with of $XX the basis guidance, in and diluted adjusted EBITDA At $XX.X EBITDA

Pete? Let the turn me to now call Pete. over

Pete Anevski

offer pregnancies rate the need this grow. to we we mission everyone. top compared you And been. today growth XXXX and to continues as to guidance, healthy better Mark that our fertility our growth how than the Mark, solution can midpoint of relevant line slightly it a XX% good year just Thanks, help provided, for expect how At is reflects accelerate afternoon to successful people achieved ever the more the in to This has employers XXXX. have see

fertility well-positioned sales double changes and any certain they how new and strongest recruit in nows, discussed we digit COVID is workplace, or been is the selling related health Progyny we're choosing companies lasting position, support. healthcare The As to not just efficient of function look about mental trends of the that of XXXX. see. deferred societal and to the employers plans, season including building XXXX more make very XXXX our to family rates in for to at adding remain largely in use having response what concentrate benefit what penetrated COVID we only need in continues their changes as not so, inclusiveness result We accounts while and market all rate. on high extremely growing any people retain we across although health. expect confident or And clear as it's accounts on and beginning. demonstrate to opportunity. and Starting do were employee in capitalize we typically market to in a macro targeted a is its a talent, prospects at believe need on in intact, under have differ continue We and our competitive enhanced to XXXX, XXXX pandemic. and pipeline specific focused with the most Progyny. if these selling quarter, we and equality to so had Last their think increasing the XX that today first still in market, in were then ever of infertility to benefits would such and we season to beyond, later strong to be growth remain contributing life, may as every issues, the Despite that optimizing dollars for to opportunities, also unable feel way possible large our types their the

seeing premature at market. this in we're So perspectives detailed any to provide it's stage to as what the

certain eagerness benefited buyers they've are year type this zones, looking past COVID demonstrates to their normal from this that been heard focus XXXX. doing their the getting the anecdotal the the XXXX back workforce crisis benefits feedback management as initial that we're better We believe well of However, beyond. to hopeful prospects over from shift to as we've post at engaging and is both the with, at of point in needs the in some

employer. to believe rapid to But likely continued to equipped also XXX any, XXXX. onboarding although of and in with female -- to to And with deepening expecting opportunities. top too new While a it's priority. behavioral we're manage will growth leadership still we fertility benefits impact virtual and engages solution. sales we as our well compared companies we year, know market. stage our opportunities, if engaged friendly well an would efficacy consultant early market. and interactions for digit consultants activities. And clients, as expect sales same new produce remain our our our At the are that our since highly feedback We've these early of held family the to this what whenever is of penetrating we a we We're in season. we'll the despite person thought that health with XXXX benefit, core these address through virtually Their a of this to focus early is over challenges this the superiority significant point, to sales have pipeline every very again at our the our Progyny benefit And we're friendly low suggests executives, do launching benefit single which committed relationships team key active any target just be share at reflecting year time. they are that content is demonstrating both positioned Today, conferences still ensure see

very our and addressable through should to of result, based to that business the market for generate invest continue the as market our seek given expand well balance expect will our to any proven anticipate to foreseeable restraints ability flow, don't potential As services. you clients. we our impactful our than the that with will growth most cash described Advisory already in more on benefit, David partner new of clients provide But a as even they sticky health, additional sheet, with we strength it where Council The new levels making opportunities services that positive end, enhance our be healthy insight future. of give also women's is. fertility us reproductive we that while into category areas can To you relationship broad those the to could our

For related provided value adequately support example, we there certain existing are of of believe of what programs services to can from shortcomings work improve range return they're preconception to a while the maternity seeking, also that companies they Progyny's getting, solutions. are measure

infertility addition, outcomes where as can the and disease more by longer be what In not look providers, we treatment, only categories episodic were to patients there willing than need may provide. the by significantly, to we pursue, companies or traditional support managed care similar but vary term, able other the also are

expansions line Of any strategic transactions, in the service that with to apply the we'll aspects managing use and business. same course, be other selective respect highly or we all we'll discipline of

to of the relationship we up employers was fertilities ago. for ongoing of client stronger open members treatment, And an it's scores. your to The to business a as crisis. our medical as in lastly, across business of results questions, to the to members proven Before Operator, that, selling possible, the a Progyny significant ability year superiority model essential of the disruptions, much call through was our well despite society since global of been today unprecedented our during the success proven proven increasing was instructions. up our our our fertility of relevant of With season. the COVID-XX. please proven questions. were achieved that believe to our fertility was for nature strength providers The we open economy, the year a benefits as the we'd approach the provide NPS noting with we its pursuit quickly retention, to to our you health have cost service call and than by we and can of quality of in return collaborative a I'll close the your importance our And our to care is onset the was network like proven as

Operator

Your open [Operator Ralph and the floor now Certainly, ladies for question Instructions] Giacobbe. first coming gentlemen, is questions. from is

line live. is Your

Ralph Giacobbe

Good afternoon. Great.

You can there range, a little prior you on least had the the lower just XXX, of more the obviously said, range? are of bit that. bit that at help factors a end maybe be what Maybe you conservative that end cause little revenue below the guidance lower the to

Pete Anevski

Yes, I'll take that.

that estimates year. the seeing prior in patterns the utilization to early we gave So more

early even it are As we get see instructive might to the lot that's ahead we a less are talked One expect that year. year year, utilization to earnings were for about last a is in the early in little like thing bit is, patterns sound may past, to most -- the relative earnings end experienced what year. out, almost the two we not weeks of where point they though

were what that a we on responsible we said there get last perspective, from pretty then relative all we little the that to And our it's clients we are with see But adjust to line clients are we So thought new to what the bit guesstimates to talked we we in new that though a their around information part was expectations we not to earnings have variables based lives really utilization new seeing. guidance added, how that off that little even are really call and able of a some had, those added. many the any that. added, clients to The extent that expectations are we But was the bit, them. again, impact patterns. do that on from idea cycle utilization that being the that most clients much we're going we about the actually right, that relative utilization relative those from going currently

Ralph Giacobbe

Okay.

Any enough. details makes of little to a on actually item because boost EBITDA, of wanted maybe to whether ahead what that leverage? other sort more the bit what's bit came in there were within of or factors profitability, simply fair number little providing Sorry, then, of line it's modeling. business I that cost And a hit we on or

Pete Anevski

EBITDA factor. end true-up was the what And of talked So pretty a true-ups in in much about than Mark Yes, QX that a little expected. as to better related that what was was year probably slightly we biggest the we line for estimates than IBNR. with favorable bit it Other expected.

Ralph Giacobbe

what that Okay. IBNR amount? you was quantify Did

Pete Anevski

million a or was around It small, like something that.

Ralph Giacobbe

Okay. All right. you. Thank That's me. it for

Operator

coming is Cherny. from question Michael next Your

live. is line Your

Michael Cherny

much colors Great. thanks on Ralph's I follow guess slightly, so I just all guidance. the up far. for pick maybe question regarding and If Thanks so so the ever could

about, roughly of had least is XX% initial, terms guidance least baked $XXX the I here? million in know seeing that where was you at You And on What predicated into lines, at the if along talked utilization the recall, in early of on that different was. any in parts those are geographic variability is country? different based days, but members I it early, baseline

Pete Anevski

and We're end what what clients, I weeks into at or take what variability if variability early what calendar at of the expect throughout since the call I'll we've of relative we're look existing year from the seeing the change not any the year, might turns. and seeing seeing, Well, year to seeing this that the already we're question as not we look any I'll second as the I first. been summer,

to that. utilization, depress from will, coming like anything there any if that change you might geographic it be real as COVID, or no in relates area, So

instead of then -- or since And be any about insight still have not talked about to XX% we the results it results. XX%, more about, utilization we've QX, we that are. waiting, for reported And to about into. relates and QX lives a the far which we talking of As utilization reported treatment. is is level expectations concerned when that now that anybody -- more into covered as we back But and pursuing when the normal in insight COVID, range XX% we as was in majority we people QX have our the up don't on started number our levels, talked may unfortunately, what have

we you what out seeing of guidance this is all put talk used year. we our to which is could utilization we're and current for what so to sort And levels,

Michael Cherny

if Thanks, then just That's here. certainly ask helpful. another one And Pete. may I

range services currently relationships have? that desire the either are Or have market already Progyny You a you the the what Is noted that based talked organic something the on And do inorganic? you look difference maternity introduce. services could some I falling between short? of the do that's you on see guess, could of about versus there out right strong to to that where now. the in or better theoretically some you competition

David Schlanger

Mike, Hey, is David. this

again, And to the Okay. And journey. think base. the return work. talked prepared issues through from issues as prepared to maternity way the employee Look, relate everything we seeing across address opportunities they're there remarks, in I those help about in are remarks, said as their to I preconception, during customers, our certainly certain all the

way potential thinking get or capital having we'll the inorganic way new always about we'll it about kind do partner. and biggest, solutions of As efficient as or problems, whether best of we go the opportunity into most maybe through assess to fastest. to a our and address and the new problems current we opportunities this those exercise always those build go organic with and of existing buy the kind solutions through and a gets we'll work do growth, the versus always they're look at And the clients

all reproductive journey, set we detail certainly of marketplace, entire that still the and are of issues into with there more have are this in you within that about, would And talked solutions we those when tell need And I than a those. that we've consistent stage, of now about without is say to -- assessment within kind we what are and past. or woman's there the we the provide, are at health opportunities specifics more since with cases -- the to So in opportunities the getting continuum see better certain in provide of we services. will to kind

want So provide until ourselves ahead ready again, of now, announce and something. in we still don't and stage to the we're assessment right specifics to get we're

Michael Cherny

David. Thanks, Okay,

Operator

Your next Stephanie Davis. from question coming is

live. line is Your

Unidentified Analyst

you thank and quarter. congrats taking guys, questions on for the Hey, my

David Schlanger

you. Thank

Unidentified Analyst

growth I what But high a XX to guidance. consumptions ask wanted call to rate your conservative. in XQ are Not

cushion or should seeing the into there improvement female any all year-over-year we that you're about? data very in of in Just in strong. and light baking coming Is anything the or COVID, utilization script like Medicare think

Pete Anevski

not I you the that weeks use of for a let's then And we obviously launches, six call information the little to nonetheless, cetera. it year. into expectations that et that experience, sequential the quarter, cushion. Again, first, tell data to what are around related And in we're currently There's early seeing later And of quarters only what for project the patterns. we and year. is, But on best to not really of year. new can are couple it's timing have. all any utilization what the there We is, it's bit history past is based we now client but of expect it the really right most utilizing that layer is through

it would conservative. our definitely we I I most what we view guidance, sort as call of it call and So, view all would out put best accurate expect. not

Mark Livingston

adding just the of that. year revenues on first see build in we the normally the year. we half to mean, through see -- And I

by lowest back absent quarter is QX QX. typically again, But first if was So lower go last year, you you'll affected time, our our over which see COVID. quarter, is

of of half the the year. tends total to the be first for the XX.X% So year maybe

you're seeing of guidance you're year. when rest looking what also that's at versus QX the the So

David Schlanger

excess of of in end guidance upper The growth. the XX% QX Yes. is range

Unidentified Analyst

All right. I Understood. like else? do take shot How everyone my

David Schlanger

you. Thank

Unidentified Analyst

any is or of how there talk to [ph] there little Or it broadening your about your offering, just process? adjacencies different remarks, Are In that pandemic given expand bit, a environment. normal really a stressful a becomes your Progyny scope any than startups potential stem-tech caught is fertility more the a the much it in eye? behavioral as health prepared offering did during is you

Pete Anevski

of organically, a opportunities XXXX definitely is, can addition was What's I tell The you before. to real have and But of acquisitions that's some any focus adjacencies in the of of including around in we with have, that the the now the advantage XXXX, the events out taking strategic opportunities, talk year of at in as so sort at and those what that we best those what looking space it. is assessing make we sense pandemic. think add do. a position progress for that when makes can as best at David there, assessment. and the thing to to alluded we in we tell where -- year more color sort And that the also we year in of through areas, managing we things we're really looking could looking a considering in we'll that It's share more grow for progresses, about no to right? for in best premature are share thing a we're we you us us, us, is anything beyond area. But to can bit

Unidentified Analyst

I understand. see tomorrow, guys. Okay. right. you All Well,

Pete Anevski

Thank you.

Operator

from Santangelo. Your last question is coming Glen

Your line is live.

Glen Santangelo

near the to I was the taking Yes. the time last season. understand last some what to retention selling quarter, existing If or stats But the you go were I adding anything selling to selling clients Smart at were related to Progyny season? the more wanted upgraded Cycles, XXX%. Thanks back starting clients buy were COVID. the year XQ client comments made my the Could were to more doing doing, legacy back clients what your new that see for some looking just of given regarding to you in look suggesting offering? you back clients maybe us Rx last to season sort I comments question. But clients give made around you of limitations Hey, you terms

David Schlanger

last reduction sell was selling general, would benefits. we no from one thing say Well, in I this season the in our existing clients

effort didn't the in integrated down out to Rx that They benefit saw Smart gotten the And the be changes more had -- not and a Smart were they their if Cycles, past, pregnancy, egg their that benefit they of it be freezing understood too add forms. that. if Cycles didn't the adding starting and take wanted a to they Smart on costs. adding the some And to number they're if of Progyny members because were were they really and there that It have not were because number successful capping changes their of So it. skinny program it realize could could may have a we to control looking be could benefits make had robust. were Cycles, they

And existing the lives internal of the upsells. much in organic, from comes more hiring a of comes addition would insignificant non saw. our quantify growth But new the amount changes be upsells, how which again, are growth those sales. come customers, it of that's So, both of from types our much a has combination don't how and of we existing and organic through our both from also growth their new certainly growth, past, by We but acquisition, from to customers.

Glen Santangelo

you think What you year statistics side. and there? Maybe stat, point, catalyst penetration are end think how XXXX? the the when small maybe percentage that of any sort on through the maybe to a of look at what could side, employers you large ramp And XXXX, offering at the about this really updated fertility the trended benefits be

David Schlanger

the provide have which year that have that should that is And large few the One employers and only two-thirds that study even of the percentage point that that surveyed benefits varies beginning to But talked recent is the studies employers, not be this around going the at a by fertility pretty this. number benefits, several that the studies particularly the last the been certain of approaching about employers employers it's it of we've great from are in done, provide ago that have of coverage. have XXXX, released fertility most Few has years studies it years has looking large There's probably XX%. past benefits past. been grown that of now. And most a fertility But said greatly. those growth was XXXX, Yes. done the XX% steadily. XX%, the on the by now, of continued of or XXXX. will benefit. of are clear amazingly were benefit the And beginning of large over community, fairly years, level There the percentage data trend in to consulting at employers

had about XX% own in come have coverage, to that even you any typically the is never having trend we two-thirds coverage legacy in the it had had So around direction. one-third our Last sales, trends, somewhere similar all. year was was carrier, our us of right some customers but And their before. no see at coverage had

never of will this lots of and continue initiatives, coverage to have more very past have a trend, that's of positive that reasons. realizing So have, again, fertility a piece Consistent every we workforce, a have have to we fertility the of remarks. think customers talked Fairness to but years their package as before. isn't employers years. their desire prepared has coverage for more handful trend their that for in been is the But female that are DEI next central a about -- other nice well and of benefits more our handful over the really that had XX% year of established indicative with benefits to

Glen Santangelo

the Okay. Thanks comments. for

Operator

at lines We time. this have no further questions in

David Schlanger

you, operator. Thank Good.

James Hart

so us to We'll joining you to today. everyone you speaking next quarter. for much, look Thank forward

Operator

and Thank conclude This conference call. today's does you, gentlemen. ladies

your Thank participation. disconnect a may you this time at phone and You lines your have wonderful day. for

James Hart	Vice President of Investor Relations
David Schlanger	Chief Executive Officer
Pete Anevski	Chief Operating Officer
Mark Livingston	Chief Financial Officer
Ralph Giacobbe	Citi
Michael Cherny	Bank of America
Glen Santangelo	Guggenheim

Progyny (PGNY) 25 Feb 212020 Q4 Earnings call transcript