Earnings call transcript Q1 2023

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Operator

Good day and welcome to the Sharecare First Quarter 2023 Earnings Call and Webcast. All participants are in listen-only mode. After today's presentation, there will be an opportunity to ask questions. [Operator Instructions] Today's call is being recorded and will be available on the company's website.

On today's call, we have Mr. CEO, and Chairman Arnold, and Mr. Jeff

President Mr. Jaffry Ferrero, for question-and-answer and who Chief as well the as Officer session. Mohammed, join Financial will Justin Chief Officer, Operating

we regarding will be XXXX, Reform statements that guidance. begin, Before Harbor remind the meaning Act strategic which forward-looking our like Private provisions during call made of of within you the we reviews this and certain would of statements statements Safe the includes to Litigation Securities

various available risks expectations to uncertainties forward-looking and beliefs, current subject These statements our and based assumptions reflect are and to our on information currently us.

believe to we undertake reflect we this no statement will expectations that any after occur revise Although are changes call. these obligation reasonable, to

differ more Descriptions are the December forward-looking Form of for some in the detail Risk that our XX-K of the year to from the discussed Factors materially statements factors SEC, in could filings results our ended with these of including XXXX. section actual XXst, cause

please found company addition, performance. website. that the believe relationship release measures of on important GAAP historical in and to most company's measures is discussing that the press be measures non-GAAP comparable between will on we the the note can certain Details non-GAAP evaluating financial in reconciliation measures the are In non-GAAP these that financial be posted

please now like ahead. go Jeff, to over Arnold. would I Jeff to hand call the Mr. conference

Jeff Arnold

XXXX results. you Thank we joining Sharecare's us morning. for QX as Good today present

opening will line and focus today's for overall strategy with before previous update, As consistent the keep our our quarterly remarks brief remain we Q&A.

pleased of life enterprise, $XXX.X on $X.X with sciences performance across and million EBITDA our adjusted revenue to channels. year quarter robust footing of the began solid report We million and are provider and first

and year-end demonstrated our lives including and to million goals, million toward During our our achieving profitability records while the eligible growth KPIs enterprise core making X.X XX.X processed. forward progress of quarter, sustainable we commitment

feedback by supported care generating is the experienced Plus, revenue million our offering, advocacy product as and of as year-over-year Sharecare $XX.X growth our in the well business XX.X% positive successful for engagement enterprise which customer quarter, launch Our CareLinx. receiving home

and continue predict This of our we delivery. AI accomplishment underscores operations to to exceptional which comprehensive value as needs as integrate platform technology and in optimize better non-clinical our well customer service the clinical

The QX, is of our signed significant driven analytics, care of have combination our AI contracts our period marking and maintaining increase a insights eligible Further, showing than the engagement advanced new as while progress cost provide the positive improved in we XXX,XXX in from proactive totaling lives efficiency. sales quality last we investment through significantly year. advocates more same

channel, example, million reach, provider and XXXX. recent winning a helped XX% public processed QX wellness our a for January program a set of has XX.X% state compared revenue in medical XXXX. market sector increase our In As broaden records, delivering large team employees begin RFP the to expanded to X.X year-over-year our we growth

globalization efforts savings large retrieval Through This tracking the by digital the we of can increased particularly and be and contracts client record and new of demand for for attributed commercial risk Medicare information national with and growth payers release delivery, to goal anticipated are operating year. towards end increased realize medical the record in channel XX of expense to began million our cost savings annualized and adjustment.

to advanced targeting for an bringing XXX channel X.X% significant we precision growth value revenue our Turning promising channel, enterprise member continues to targeting including capabilities, winning individuals zero-party database a but add channel, in catalogue million our of award and Life extensive to Sciences modest of content. This year-over-year a experienced over QX.

same XX% period healthy a compared the Sciences year Life the forward, increase, to pipeline for up Looking year. showing last is currently

across we remain our to options platform maximize the long-term organic growth to thoroughly all shareholder near to saving drive on same on our value. and shareholders. exploring At executing process, initiatives value continue pursue and strategic time, cost We driving review to strategic focused

been quarter XXXX with In a growth consistent solid has for summary, key across Sharecare QX business all channels. our

leveraging improvement innovation the in momentum confidence year us dedication continuous datasets into and and technology our this sustaining for extensive gives Our to XXXX. throughout against

hand I'll on it to Now, financials. our Justin more over provide to details

Justin?

Justin Ferrero

million Thank point exceeding a adjusted the We our million $X.X ago year representing guidance. had of Jeff. ago to growth with strong first from and revenue million, million XX.X% $X.X versus of of with EBITDA the both you, high start quarter year $XXX.X year a $XXX.X a

more KPIs across performance medical Sharecare due balance and maintain the enterprise provider, Positive yielding debt. ending million continues sheet, achieving XXX we of on liquidity also lives million the life secure quarter eligible and available is growth increase in with retrieved. over to channels, a no in hand, as core enterprise, to number XXX toward our cash strong sciences momentum and records

quarter set to is $XXX.X an in second revenue forward Looking our for QX, of increase $XXX.X million XXXX. between guidance the million from $XXX.X and million,

$X.X guidance to an XX% Our midpoint over million using fiscal range. million, approximately EBITDA adjusted of $X.X QX the QX is the 'XX increase of

annualized our year. XX at are this XX to We work million savings be in fiscal with hard realized savings opportunity, million realize projected to

savings year. we expect of these accelerate half to move as into the We latter the

our and of and globalization EBITDA the our double We to combination EBITDA our believe turn re-engineering expansion positive target XXXX. cash nearly of processes to will of strategic automation, us the adjusted margins flow adjusted within workforce enable year-over-year business contribute

QX raising full Based end outperformance year current are guidance visibility, top $XXX.X million. the to line of we upon our our low and revenue XXXX business

million million. reaffirming XXXX revenue also your of appreciate $XX top end support. are continued the $XXX adjusted and of guidance We million $XX range We EBITDA to

your ready you. questions. take now Thank to We're

Operator

our the session. BTIG. of David begin go question ahead. And question-and-answer will Larsen Please first [Operator Instructions] come now We'll from

David Larsen

sort Enterprise? a good bit Can Can talk you something of lives you as those cadence can and Thank you roll quarter. a were lives Jeff, should you from progress we that expected customers, handful you. I Congratulations revenue quarter. on the where talk in added a you about Hi. XXX,XXX to in think enterprise the the onto that, little more they Carelon? bit When we lives talk of through XXXX? from first mentioned like about expect and those little

Jeff Arnold

Sure. Thank had quarter. David. you. really Hi, we a good first Yeah,

Our XX,XXX sales signed put kick we starting force eligible year of lives. last new up in. To in kind QX, in it to really is perspective,

quarter sector This The public it those I lives are was force over XXX,XXX. the I And in in as been majority XXXX. investing comments, in mentioned we've of our think well. sales opening

a wellness land to able were we state account. large So

also However, lives throughout over that and brought as that the roll as will year. well Carelon on that QX, customers some new does include

David Larsen

willing that them? talk Plus. you rate? Sharecare is your on you Can in pay Does for clients the why How are PMPM for Plus. and result the clients that do to many about Okay. progress then have that Sharecare and more have what platform receptivity in savings delta to clients higher And and the claims

Justin Ferrero

lives. it's at Maybe And Justin. Sharecare close with the The a higher million the start a platform to I'll lives start. we've it for Hey, as I'll David, discussed, is PMPM. Plus. is, lives on

PMPM. we've we're Plus averaged close to, historically you between lives, you as know, roughly $X purely know, to our are PMPM our that, an You know, increase, digital lives Sharecare is $X about $X which talked and on

a significant it's uptick. So

Jeff Arnold

approach, is, And know, I'll maybe, piece, but I is is it's Jaffry, add a the what why compelling. you can think you on clinical digital having offering strong really add first a

good get do been to know, do the do experience we've How BXB engage? people we at a you we you always front we winning feel? know, So, produce personalized door. BXC, award How how make content?

in through enabled that right the I advocacy, And at which added want digital is data it, it clinical? And you same one touch digitally, Jeffrey, first when door. the front do you was had know, the the have advocacy Over we looking to on -- which client And for was the we large for. this happening what of interactions is we hoped morning. XX% between advocacy digital

Jaffry Mohammed

up is value have the in in to have ED through mean, driven that and cost the measures. customers. waste where we I visits, sure. place RX emerging the the we cost, value our in front analytics the to and the Yeah, optimizing of identifying in visits, clinical redirection of our onset the What is of in impact very optimizing saving seen controlling terms delivers quality utilization, identify strong a systems opportunities a by terms clinical patient

For the Plus, doing are very activities into translated we customers. on have customers that quantifiable Sharecare are savings those who to our

David Larsen

number know, know, just reasonable? Like percent Okay. that? What using ultimately please an even though spend what admissions metric, a more, put inpatient on reasonable? important we Plus think might do money you by we clients your a Is they're see? platform. Jeffrey, percent more see. Is do can I the you that, saving given savings reduction in Sharecare X% XX% little that's you

Jaffry Mohammed

range we number. it hospital the that. in where specific are from that slightly be know, mean, leading I it's readmission range we vended speak of to you I are Yeah. our the of publish of for profile that customers. customer to customers. is have report And a the be journal. would early we varies a The we to much published going in that, for the report David, difficult it soon me how around have very as on hospital very But to very give might avoided from where but think, showing one to XX% in And customer. XX% It readmission

David Larsen

continued expected any about additions or Should the in then color enterprise are expect life we just year see would helpful. be being last of Okay. can very increases signed in talk that were lives you deals And cadence to added of there because to XXXX? that

Jeff Arnold

one, we and sight of Yes, line additional but Dave, we've one July largest have talked on the Xst. is this, to October that is about growth, adding typically Xst lives

expect can added additional the through year. you lives So to see

David Larsen

you that's Okay. of more It's in lot It me solution. in queue. very Uber just a I'll And the homecare. basically There's bit a Can hop for seems back a CareLinx? to just like about and little growth then high one value talk MA.

to Any that United is with I think them? relative Just client. incremental expectations? a And you've how discussions having been is trending

Jeff Arnold

CareLinx. membership Yeah, grow we for our continue to base

to to the XXX,XXX this solution first we've gone brought the have and on to last quick? year. from less we MA but want business, think our we've over it we're traction. also We our talked real X talk I past. advocacy for well. that plan CareLinx spear million It's within Do CareLinx to million our of this Blues X.X not than tip in as using for differentiate year to good year you the over And really using as only

Jaffry Mohammed

question, Yeah, sure. to goes back David. this also previous mean, your I

I said, to the think as the being for contain us, is tip of CareLinx says, cost it as used Jeff which care. of sphere

the the of cost take some to created savings our in chronic have optimize I and programs acute about care of to leadership clinical which We earlier. under CareLinx illnesses and talked many

David Larsen

in back hop have a queue. I the of questions Fantastic. here, I'll Okay. list Thank whole you. but

Jeff Arnold

Okay.

Operator

question comes next Canaccord Close The of ahead. Please go Genuity. from Richard

Richard Close

Yes. the the questions. on Thanks for Congratulations results.

provider the on sounds just It I First, Can some you think payment into payers. segment, like integrity you said national those wins. mentioned. relationships? dive you

Jeff Arnold

all that Yeah, medical was business. retrieval

So we record in had and a revenues records processed. quarter

really great provider a You was historically know been business and sale. been in is effectively what's cross-pollinate what we've able that to

of the Now payers. half made up revenue is from

Richard Close

Okay.

Justin Ferrero

wasn't a cross-selling lot about from payer it Richard. Jeff now of payment is, is underscoring to close just It that that business was what from audits as And that our payers. our And Yeah, talked has integrity, said capabilities. you customers. know, half again we've

Richard Close

Thanks. helpful. That's Okay,

various in to hitting like where P&L XX you in that over we terms cost million of see respect in savings just XXXX. of with the terms go opportunity. the Justin the XX Can buckets? million here

Justin Ferrero

Yeah.

you well. it know, our We workforce areas. performing for globalization and broke into around been provider a it's So, over two on XX now very XX of million that is the has year this division. million underway

million primarily COGS of the And XX expect XX and realize side. primarily track will the line, on the be We will It the be on year, million are by that this XX some OpEx we end of XX well million. to that million year. in

CapEx. we're that in then also and talked the well will and and realized a corporate that million of XX XXXX OpEx about And mix across million enterprise XX of rationalization business. underway and on being we XX the be And

So throughout for gives which part line, the EBITDA our target well on see us CapEx come down OpEx as efficiency our year you should you know, confidence as of, doubling year. this nearly in is which our

Richard Close

are calendar XX% respect growth some year and or With purchasing that deals that this thinking, encouraging the year? to Life hits closed you increase. the increase, Sciences know, Okay. you Jeff, the the more for is you pipeline pipeline year-over-year XXXX

Jeff Arnold

this year. for That's

Richard Close

I'll Okay. right. hop All questions. the Thanks back the in for queue.

Jeff Arnold

Thank Okay. you.

Operator

The question Nephron Eric next of ahead. from go Research. comes Percher Please

Eric Percher

market us called what ended in Thank I'll the now you're trend micro out? spend bit of you. you where the a little in Life-Sci. start perspective give Can you ago XX% on and you Maybe versus versus just macro seeing just year on a

Justin Ferrero

that we the Nielsen showed mean of I that, spend down is was our XX% in off pharma Yeah. know, reports you go quarter. digital first

we over X%. channel are, in enthusiastic of quarter, a little being just performance the about so And the first know, know, up, you that you

So maybe macro which us seeing be but but our HCP we trends pharma watch might areas, closely. move digital is we're know, stronger, digital specific that pharma, and is year-over-year. down But the other we've area area, read you an spend, against

So hold we're pleased serve, to and show pipeline. nice not only to but expanding growth

Jeff Arnold

add I'd been continue have exceeding benchmarks. our campaigns we strong to know, that you performance. maybe XX% to is, And see of

couple a Just other stats.

brands XX top year-over-year. Our grew XX%

clients. year-over-year. We big year-over-year clients three our growth standing larger of from had top longest Our XX% XX grew

over longest for know, of XXX% the over time, grew three year. clients it, took respectively we've had the that you they amount if XXX%, So big you

with you modest to starting growth. really that we're see So, know, we're pleased is what

to you referenced, starting sector renewing brands the is overall, pipeline. and as that know, are our but We're Yes, top see they're down, growing. Justin

Eric Percher

just valuations. That's general And peace use terms us potential you and M&A capital of see update was market. valuations current other provider bail seeing we're can and then as the with transactions sit in helpful. where my more from provide today of whether made on the a we in Any question

Jeff Arnold

you I independently others the what market we're you we know, undervalued. you to that, we've Well, trying know, I to in market. like say of owned that our like the to out assets value And, suggesting, think is collectively been prove you're as know, active, underlying and feel very would the

only gone obviously plays the taken see strategic are within But see the been we of Market but through lots companies. yes, we our see this. private into peers public you see, we've year not But our valuations and review. consideration that's, we know, now opportunity as into also affecting we

Eric Percher

you. Thank

Operator

Jeff This like session. turn for Arnold question-and-answer closing concludes would to our any I the remarks. conference to back over

Jeff Arnold

you. want reiterate quarter. our thank to very we're Well, pleased with Great. In that this closing, financial performance I

to employee XXXX lives XXX,XXX QX In quarter, significant we end Enterprise including adjusted plan. as revenue addition channel, of win new public our booked for exceeding and eligible the during sector a guidance, a state our wellness top the discussed, EBITDA large

This we the year and to progress we force, throughout demonstrates are confident the and realizing will continue in are on the meaningful operational sales drive value which investments already this growth alignment our beyond.

performed in also achieving The breaking provider QX, channel revenue. record very quarterly well

channel grew its the Science and as during is Life up current pipeline, our discussed, While quarter we XX% year-over-year.

with that capabilities As three one we all depth a of to driven of stated, built have another our we for platform believe unique that's a together ecosystem breadth complement create scale. Sharecare that and channels enabled

EBITDA our us we cost XXXX. expansion within and could which remarks, on to margins that As considerations, will in channels, cash noted positive our shareholders. and to strategic strategies the opening contribute beyond these unlock adjusted continue turn my value we initiatives additional to options across we I But above flow consider of have believe for and embarked globalization savings enable

for Have a day. interest. you your thank always, great As

Operator

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

Sharecare (SHCR) 10 May 232023 Q1 Earnings call transcript