SMLR - Earnings call transcript Q2 2022

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Operator

Good afternoon, and welcome to the Semler Scientific Second Quarter 2022 Financial Results Conference Call. [Operator Instructions]. I would now like to introduce Doug Murphy-Chutorian, CEO of Semler Scientific. Please go ahead.

Douglas Murphy-Chutorian

Good afternoon, everyone. us second joining call. XXXX for you for quarter our results Thank Communication is you May Semler Corporate introduce pleasure as Business Renae of It to joined to my Cormier, who Head and Strategy. in recently experience extensive and was side. had has on in buy Renae the accounting finance and most

Please Some of already. the speak to opportunity you Renae. to have her had welcome

Renae Cormier

investment shareholders. you, Good afternoon, forward us to excited I'm and Doug. and looking joining our Thank be engaging to community the with today. thank you and here for

In with Dennis Weinstein, could We because remarks. Doug, be speedy addition Finance not SVP, for will battling I a is available today prepared Andy to recovery. Q&A is today me and today's Doug, us and COVID. Rosenberg Accounting. him he Andy wish join following

to safe that during financial you the business begin, provisions Before for could our statements date forward-looking known of obligation differ risks statements filings. pursuant certain forward-looking and as regarding do need not forward-looking to forward-looking expansion the call, subject release our uncertainties any results we press products our are call expectations Private are this Litigation as and and described unknown undertake uncertainties this statements Act our to are I update of harbor as today the materially SEC and statements. include made The to actual both and are meaning and statements risks that from our and Such well of These such Those made made cause to constitute and of statements. we of in the XXXX may Reform amended. of additional guidance. Securities as the comments within remind

today's quarter and website, record a We're one pleased that report If copy the balances. may our Investor second the to company of cash release, you quarterly obtain do during semlerscientific.com. revenues Relations page XXXX, of reported not you have visiting the by of

existing independent the like are which orders more the Andy? see June call and turn describe We to to its published traction in in are performance peer-reviewed are now from XXXX from I was from in QuantaFlo, financial we study beginning our detail. Andy would to to customers Orders increasing, on customers. form. new over receiving final

Andrew Weinstein

the Renae. the described Please distributed Thanks, refer was today. results release market that in to close financial press at

revenues million, a For ended of XX% X% $XX.X million, the of and period decrease XXXX, of to million, fee XXXX $X.X fee were increase were was compared X% Fixed the an an $X quarter revenue year-over-year. revenues of $XX.X XX% of an XX, were June of million. Equipment increase year-over-year. corresponding revenues Variable year-over-year. increase $XXX,XXX, other

slowing of a to many due customers the on a cycle higher-than-normal which illness and in of we employee effect pandemic, believe and our staff had from XXXX. sales rate our absenteeism half first prospects of COVID-XX the Our experienced

Although these of first quarter XXXX. to absences lessened during the the second quarter compared

the On results are compared our the of year. quarter record in being revenues to a variable prior fee side,

XXXX, believe lockdowns year-over-year testing XXXX, in comparisons. prohibit Therefore, the be believe Risk during performing in there We our X in-home would and the fee fear quarter may strong in or that unusually could in we further for by As before, revenue later a still we for were of there first seasonality fee year COVID-XX-related evaluations. discussed XXXX HRA pulled We saw variable revenues in variable our forward us the customers thus Health Assessment was time for our business. the first largest of related customer comprised of of had revenue for affiliates, their thesis X XX% Furthermore, XXXX. be their about the revenues. was revenues. increase including of we equipment we saw compared XXXX, and In sales quarter, but all XX% a also in including to our our which XX% not XXXX. the the XXXX some and customers, to related to In during affiliates, extent second XXXX, HRA seasonality quarter XX% in seasonality, of customers supports largest quarter have

share We Our did revenue, all compared include benefit of original expenses, their the were revenue Operating XX% was difference rate of includes Operating change accounts effective $X.X cost the lower year. year of income tax affiliates. which with period, million. XX% for $X.XX prior increased an stock-based partially increased Net $X.XX associated of over tax our was tax benefit of $XXX,XXX tax of effective from reporting between compensation million. professional Net in COVID-XX-related expenses was had or expansion not primarily increased million, with year-over-year plans. of at which credits an $X.X million provision benefits headcount prior time income same our from an wage diluted of $X.X to received of primarily the for diluted The net X%, decrease to $X.X largest $X.X income last QX to and an year-over-year increase business due customer share, of due million, which from to in inflation, a X income the per XX% expiration payroll plans, fees rate compares and per line the the in tax periods. tax insurance year. the income

million share. We ended X.X basic the end of for diluted quarter repurchased per quarter XX, and million. cash cash was average $XX.XX shares the share equivalents price at count average We count the was share X had at million the of million. June an and of during $XX average $X.X XX,XXX quarter For weighted weighted XXXX,

on guidance. Now to

our were range, while XXXX the expenses lower quarter Second revenue came without in than guidance. guidance operating

As guidance. our some full to such, made year adjustments we have

$XX be of the to million. annual in range will $XX revenue continue million We expect to

our cost million. have of $XX million which million other changed $XX.X to our for revenue guidance expenses, includes $XX than expectation $XX which a of less is operating range to We million, to of

XX% will extent second the giving second XXXX. half accelerate Given growth XXXX to We the year, revenue half compared the guidance. the not to seasonality in believe of of uncertainty around of QX are this we XX% to specific do

confident Nevada support the Insulin growth provide not product Insights Paper We QX. orders the interest given We from in in further do are should material our in customer in product be to or the increasing, expect but XXXX. XXXX, QuantaFlo year next in guidance extension should see and received increased We revenues our growth.

our For to the of second our cash XXXX. to XXX the the the way the XXXX. remainder compared we end guidance. achieve operating headcount activities. of In us In operating August XXXX, was growth the continued of Semler our return efficiencies XXXX, predict or expects able XXXX, that first were quarterly We to previous increased X, higher on for at operating and sales revenue At file expect of of around to we XXXX, at half growth to employees expense pave in operating expenses Form report on rate. organization staff allow quarter do lower our from XXX end the generation also and first profitability expanded XX-Q of the quarter a than to

Renae to discussion the remarks. continue I'll and Renae? concluding provide Now ask

Renae Cormier

value new to goals R&D services product to and be products existing we believe provide Our enhanced other or services to can in-license which continue to and to and our customers. commercialize products, services distribute the and developed internally upgrade data

both additions existing services customer orders and business expand through to to to new make base, development data additional product from introduce Our upgrades are customers, our products our goals existing customers, to products and a than that of new further market product larger market current industry. testing We in care standard penetration. the disease as QuantaFlo and our for the vascular believe establish is our

is for continued So growth. room there

quarter, innovative which of in that to underscoring the future. providing Last to with using the products invest continue Paper. customer and goal data to patients, value large R&D of as the refer We had Nevada reported the now we benefits we asymptomatic a on our customers in the QuantaFlo published enhance

and in Formally to of potential currently published and Vascular introducing of Nevada data Surgery, XXXX the we're findings clients. Paper the in the June Journal existing

positive with that message and permeates of we section link care screen to of While benefits Thus, the nothing to that further under found the they for. overnight, adoption of believes new customers. PAD QuantaFlo can population and a the showed Scientific be brings patients website the risk our PAD might A level. the has the of and Semler having the things, become drive believe the customers supports other might QuantaFlo QuantaFlo medical be new customers our this we'll to to use it study Relations further Press product the when and Investor QuantaFlo happens for at study highlights study the goal QuantaFlo Releases. care. more of community, attracted existing by move in use standard the management potential Among the our

extension existing regarding aids others important as as in from QuantaFlo another FDA of We patients uses is can uses as further used who this protected The our the It primary we cardiovascular the ago. extension the unserved for as in key extension to more extension points internal how software-as-a-service We base existing the also may through believe this model. valuable many disease. by years to setting similar this business make medical Advantage problem an efforts clearance benefit Other evaluation QuantaFlo PAD. to trade and may that this customer be last to announced upgrade be community for a now are as sell secrets. an test future, aid care identify Medicare even clinical one a including QuantaFlo our We to providers. quarter assist development would performs our PAD, technology the anticipated it intend to medical

and has date a it is peer publication submitted to as share our you with peer-reviewed the begun. have of product as not journal review we'll this We the very the update published. the control. Because selling We're time process the by publication. data the it the and that can at share under data excited soon timing We are publisher, is to for controlled

The customers to is are We been handful has and of range in represent contracts feedback signed. a along with the shelf These ship ready the very positive. as are and a customers. far on product of as sizes soon discussions

be and Insights, has Insights. the revenue Insulin we plan fiscal guidance base smaller beta in The market There initial Insulin to of with for continue customers. is if launch, goes our positive, all our XXXX it feedback customers. to launch included in to beta well with minimal established several Regarding we been

The XX XX% per around over on have occurrence and old in patient a over adults of glycemic manage per will under care even patients be can Of a to recall outpatient diabetic help dosing on people. runs Insulin groups a optimize another like I'd is these model You population to that a the program manage provider that involved. primary program patients. XX% may of XX% over at is insulin-dependent people fee. no a greater of to desktop that population, sold of insulin management It approximately frame Insights There diabetes. with moment the a to on in optimal diabetes. health glucometers order take in diabetes. blood are Around physicians information XX the software million care the use meal SaaS The medication of to insulin glucose the patient-specific XX% the The million is U.S. month patient patterns. Type X to our designed to clinician software dosing population provide X the Type that with initial analyze levels. or insulin on markets. to another to maintain or in algorithm It and is based used is combination hardware market. and and is diabetes XX Both years adjust data target from software adult

During the owner price quarter, for outstanding Health, X a of $XXX,XXX. notes Insights Mellitus of Insulin from purchase parties convertible private acquired we

were In our stock buying through in addition, Mellitus -- In during million actively secured regards the notes. promissory loaned Year-to-date, just $X we share $X to million we XXX,XXX shares. the repurchased have back market under open we or repurchases, senior own quarter.

program. Board have investment repurchase upon discretion of cash the that conditions be for We any amount of based timing balances. use we and subject The $XX transactions on remaining to and may the our market future have million will authorized in opportunities stock other

to is goal shareholder Our value. maximize

during participate presenting including and quarter, at Diagnostics September interest for Thank on in we non-deal the roadshows, plan XxX the investor continued the Conference Ideas Needham of support. Street August Xth Virtual numerous MedTech Annual participated Conference your your calls Xth September conferences Conference on virtual Best and in XX, Investment Annual we XX. QX, Lake and to the the week H.C. investor Wainwright During company in you Global and Growth XX

Now Andy will operator, lines. happy address your questions. Doug, be open the to please I and

Operator

Instructions]. [Operator

first from from Our question Markets. O'Neil Lake Capital comes Brooks Street

Brooks O'Neil

given far the already Welcome, just in company. us other X Renae. information say, than these us to guys by more Renae, I've have covered I all want you've time given the

have So I'm excited to you here.

you for in seasonality year, the quarter, see few I pretty have -- any is enthusiasm to very was clients test at unprecedented that you obviously, fee know the a quite impact I or strong Do response you. indication of fee a fixed COVID. either it your see have great. which to But extreme lost your do per all Obviously, for So patients? questions any last their clients QuantaFlo and using test

Renae Cormier

I quite opposite. haven't. that And it's we say would No, the

the thinking that both We are less seeing than our gives quarter, HRA during that us the XX% existing product. both remarks confidence particular customers this customers our it the year was increase that from be increased And last customers revenue in will the one of in that did equipment one for revenue the interest new sales it second reasons in was the things to severe our in year. which of and and seasonality we highlighted guidance in is

Brooks O'Neil

Yes. That's great.

recognize Let this all you seen is seeing to stay because another customers I stepping or my in no-brainer X view, question my struggle begin time. me clinically and the causing should additional from a maybe it's to other a and for several it's plans a appropriate health now? health a at time -- ask of no-brainer away my Are your a party in do also is it both that Advantage have really I largest such years plans perspective and you from you by the just Medicare is ask plans -- aren't to view. another mean these think you business of no-brainer known financial with health complete both QuantaFlo Obviously, what some that's use up clinical that perspective. the what I

Renae Cormier

that are that don't prohibited customers. seeing think we really actually things And past one is Paper from period, largest of largest of that this things we're is they paused data I customers, other have. XXXX. And customers spans a the has to is access Yes. Nevada think our in so of it starting multiyear Right. one data that from the about the No, excited some in that I the from maybe or interest one our it people have

it that results. So to there seen and should and the And customers data out with on what's the others provides more certainly, the there results in compelling really have market some it. they've solid published adopt be

Brooks O'Neil

good. That's Okay.

revenue just how sort to the just contribute can ask product? any it. to and us customers, and me when seen appreciate available does to don't efforts your Andy customers But one today? begin to dynamics actually anything so, incremental affect feel it it your might I willingness to to you are it this extension buy mean, selling pay business or initial Let the dollars say And if you have I give And about the the more, to this for product pricing if company? make any I of if sell know I'm line or Doug wants to curious your you one. this

Douglas Murphy-Chutorian

want to you Do start?

Renae Cormier

Sure. on and start you can Why I add some this. here then, Doug, don't in

are we customers. as So we along far speaking in mentioned, with

So contracts we signed yet. haven't

aren't disclosing excited this We that new. And we this, yet pricing but do customers on obviously, our product. are it's see about

current it's going So see how they to their fit business. want within to

guys as you what there. as on also publication soon is this out update we so will expect And to this is

you do Doug, add or So to have Andy? else anything

Douglas Murphy-Chutorian

profit contract feel we get customers. that is a But signed their it's we reality. exciting have into to going and got think, be to to I first that value turning restriction our

quarter. to in more the So on later add

Operator

comes from Securities. Marc question Riley B. next Wiesenberger The from

Marc Wiesenberger

payers of Paper. maybe Nevada of additional some on these Brooks' of the far? and considered payers Nevada question up following from other these Previously, that has this in payers classification changed experimental, knowledge have QuantaFlo so Paper your terms any Just to

Renae Cormier

qualified year I that as their and Doug, I you can't this a well. that any And comment have that other are what's out not. comments? them I know they've of classification. they once changed But come know don't or if do receiving on experimental I lot know a

Douglas Murphy-Chutorian

it all. that said think you I

anticipate test. additional it that for test and justifies Paper you the increased If I we that they have anything additional asymptomatic have Nevada a think payments important to It's from do risk definition risk. patients need maintain positive we what justifies understand to do of this they if it. know and can CMS, about apparently the something

can't you If don't know you anything. what do

guys maybe to or that And the thinking So anybody. I going convincing to experimental, are all it's very it's to few it's think be be going convincing. the

Marc Wiesenberger

but the if in your out that us actually fee if the fixed shipped you have not then kind fee been strength to And yet in indication you activated. referring field in wondering QuantaFlo generating business. I'm revenue. And the are many specifically HRA the that Understood. variable could any kind confidence relative in talked and of channel. to equipment provides units And the think could give maybe that how units sales on about and guys I you maybe put of I'm context

Renae Cormier

Yes.

So in really haven't about nor the units we shipped. know have we Marc, you out units that the the I that we past think talked there

numbers. talking this I at time, our to unit going remain we're not So think about

Marc Wiesenberger

in say you fixed in the of half level fee you have the business going that back about confidence that talked you and same the of in forward? the have terms variable Would fee

Renae Cormier

Yes.

fee, of So sell we're And seeing our we them. those momentum give of fee instead obviously, fixed them. the to in fixed both customers

seeing revenue not that you're line. So the on

Marc Wiesenberger

the for populations? to that are the patient sense any testing or if populations your then customers looking target their patient And test Okay. has frequency changed

Renae Cormier

with the the in population. disruption, the as some No, age in some in performed past the And the changes being tests in terms also anything virtually not and in market seen especially of was instead of the years of as difference HRA person. There think I there. X disruption we the or have far of

suggesting while In HRAs could it all every and other tested so every And upon year. the then really dependent are of direction of and be year, be practice, we year, payer should patients the longer, their could every be could it's be it that our also it clients.

Marc Wiesenberger

Understood.

more a me. from Just few

potential You commercial this but year think Texas. was next your Insights if the I didn't could recent talking Discern test. anything Insulin revenue into release a And I'm wondering year? on hear about mentioned you that and in I Alzheimer's maybe product, opportunities launch about press maybe and expand there

Renae Cormier

Yes, sure.

have we update. So really didn't from our an perspective,

are SYNAPS, in Discern's investment So an equity is which we parent company.

have don't agreement. we So a distribution

So any recording this won't an at only equity we be time, investment. it's from revenue since them

Marc Wiesenberger

the Got the And was in assets your then the addressed at there it. and all? for year increase for million Understood. in final think just for? in a are was that back the your noncurrent I don't remarks me. that then expectations or the X half I press what of $X growth think release headcount What prepared either if And you

Renae Cormier

Sure.

side. expense on and count head So the

hiring So new Paper on we do then ramp positions. as our you this have set and we know, but did the And XXXX up product also headcount, Nevada are fairly in we in anticipation launch. our of some open

So within plans. look expected they ramp to if that's for at our all expenses our but bit, HX are to HX, you a

the count then I can't -- go So might did up. some gosh, see for my I believe you this. head And

The question? second

Marc Wiesenberger

The increase noncurrent $X in assets? million

Renae Cormier

yes, the sure. Oh, -- X

that our for related agreement. just and was So license and that reclass prepaid Insights assets, current Insulin distribution a to fees from was

Operator

to conference This concludes Renae Cormier any closing over for back like I'd turn remarks. the our to question-and-answer session.

Renae Cormier

you, us remain a Have night. optimistic joining on our our today. about continued good and progress. soon to you Thank updating forward look future everyone, We for

Operator

has attending you The now Thank presentation. concluded. for today's conference

You may now disconnect.

Semler Scientific (SMLR) 3 Aug 222022 Q2 Earnings call transcript