WAY - Earnings call transcript Q4 2024

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Operator

Good day. Thank you for standing by. Welcome to Waystar Fourth Quarter 2024 Earnings Conference Call. [Operator Instructions] Please note that today's conference is being recorded.

conference Investor your Relations. the Draper, host, hand of Head now over speaker to Sandy I'll Please ahead. go

Alexander Draper

Thank you, Corporation's will remarks, operator, Executive Officer, my your earnings pleasure are and for Matt open Officer; good morning, welcome call. today. Waystar's questions. to the everyone. and you joining Steve call Waystar Chief Waystar's me we Holding Hawkins, fourth Oreskovich, XXXX to quarter Chief It Financial is their After

financial issued The a of a press on Earlier results this our accompany remarks. and at slide announcing prepared the morning, materials to deck investors.waystar.com. we our website section presentation release available Investor our Relations are

we results, number of forward-looking actual materially statements These of Before this these results a will are growth that statements expectations differ expressed involve events. you call statements, in future of may and Examples started, include contains that cause to margins. these those statements. financial get predictions I risks remind which about uncertainties and from future

For this morning's available call. discussion of forward-looking page to of the are may all refer that Investor statements, of the Any the please and our impact date this risks a the SEC, other are of during of made release we file our call these and which reports with statements full Relations website. forward-looking on press factors the provided only as

today's discuss call, measures. non-GAAP During we also will financial certain

slide explanations XXXX and from measures net these deck presentation our the excluding are release. are financial comparable to of included reconciliations website. with included appendix now earnings reconciliation measures on most and the provided metrics in amortization note our non-GAAP we income of the that A our intangibles slides order metrics. earnings these our XXXX of of measures GAAP to in for better align of our non-GAAP EPS peers, have with Please in directly We and the in together the remarks

over to call the turn I'll Matt. that, With

Matthew Hawkins

Thank our everyone. call. Thank you you, joining morning, Sandy, for earnings XXXX QX and good

as Waystar the achieved that agility strengthened reached XXXX and was position in strategic growth, demonstrated we significant industry. for defining a milestones year our

normal of relationships with helped restoring a and providers a expanding to recover cyber them, their adding community. work clients on attack expanding from addition XX,XXX than cash competitor, In our client more our flow we and

raised to In and position drive June, our innovation. billion we financial completed $X strengthened IPO, continued and growth our approximately

is today's health care stress which waste landscape, In rapidly-evolving health waste, and to work purpose-built and manual errors. annually, platform The administrative more administrative extra care than for billion work costs reduce providers. software $XXX Waystar creates

health augments efficiencies, simplify to flow. modern software is and mission Our that care cash timeliness, accuracy payment and operational payments with improves enhances

create is We believe sustainable value. growth long-term positioned to drive Waystar and

clients have returns and our are delivering about We measurable results for focused investors. optimism maximizing future on our and and

do I'll future topics each Now key our quarter, cover X direction. as that highlight I progress and

discuss and compounding sustainable will I First, Waystar's revenue growth.

share I will are driving we Second, profitability efficiency. and operational how

CFO, recent guidance. Steve, our member for latest Third, fiscal XXXX innovations I'll to fiscal turn our review successes. results over call and financial XXXX client highlight the Fourth, Then client and speak QX who review the I will I XXXX will team to year value. will our driving and

line growth. First, strong sustainable another QX, of In delivered growth. quarter Waystar top

double-digit exceeded this in Our cover of details will of revenue or million reached XX% year-over-year low to $XXX year XX% target million, call. in normalized more $XXX our bringing revenue Steve our long-term representing growth. year-over-year This detail increase, an full outperformance growth. later the

goals. cost of is achieving to client growth relationships the sustainable drives that software by strategy investment, create while reducing enduring delivering tangible on their Our return total

of platform, flow management. business and operations adoption it they to realize the making value, their deepen clients Waystar software As cash essential their

momentum. Two key our highlight metrics

of our of end at in the the XXX% XX came XXX% retention over to revenue net historical in past First, range high at XXX% quarters. QX,

increase more year-over-year. of to the $XXX,XXX XX-month trailing in an X,XXX , revenue grew Second, than clients XX% of number generating

alternative Our after house cyber continued who QX competitor. a on attack growth to a benefit an are clients we the clearing from onboarded seeking

will most We platform. their adoption confident of deepen are these of Waystar clients the

fact, In already opportunities initial beyond are XX% approximately and implementation claims remit pursuing of their solutions. cross-sell

In XXXX, the pipeline In record we achieved from for implementation. projects a number we of of strong activations implementation backlog XXXX, of start with ready a projects. the year

are as activations expected, XXXX's into ramping our recent reinforcing Additionally, view outlook.

efficiency. and profitability Next,

continues quarter EBITDA year-over-year. Adjusted XX% reached performance. the million, This adjusted up EBITDA $XXX strong trend of

with value XXXX, to This that commitment fiscal we investments leverage margins XX.X%. our full creating while future our highlights year to make For important platform for on of delivered margins, position continue Waystar scale, software our operating growth. the as adjusted of performance year we long-term EBITDA XX% we of target and

The unlevered Our to cash the our to in was in flow cash. XXXX and XX% adjusted Unlevered of QX performance model's generate underscores also efficiency business highlights quarter to million, generate ability free million. cash our free to strong bringing EBITDA fiscal conversion total flow. XXXX's operational cash $XXX ability $XX

in a report X.Xx, leverage to higher to Xx the of compared that balance QX reduced and to pleased growth adjusted ratio the at 'XX. are EBITDA net cash We end our

leveraging pursue for to and maximize remain sustainable drive Waystar's We profile strong in cash provides committed value to to business, reduce flow opportunities investors. reinvest our position and M&A our growth the debt.

innovation more our At faster, platform and growth, efficiently. fuels accurately Now, empowering to clients Waystar, paid more innovation. get

return end-to-end and post-service pre-service streamlines to workflow, patients to platform efficiency, and of modern on delivered identification cloud-based care new Our access payments investment. quarter with from hundreds enhancements each collections, accuracy health sustainable the drive

processes in automate AI network providers over software. this leveraging powerful fuel that trillion By gross insurance effects Waystar capabilities $X.X data, reduce and our manual generating billion annually, which learn, and our AI-powered error-prone transactions enables than workflows intervention. claims continuously more X to

more result, a resources time allocate care. patient As to and can providers

more Last across high-impact dozen we capabilities a generative been component platform identified Google for our our year, solutions. than mission. collaboration AI is formed to decade a over our core AI a and with has of software advance end-to-end Cloud and a pervasive

management innovation vision we our providers. AI January X, and Its for AI first-of-its-kind Altitude denial existing launched early recovery appeal new in appeal Altitude access autonomously accelerates AI-powered on continuing is types, to to On improving across Waystar drafting capability. clients embedded generative denial denial and multiple speed. letters Create, solution, deliver Altitude, by now the of capability, Create our giving efficiency reimbursement

packages are package. average meaningful In first per saving month, Waystar Clients early-access an results. seeing its appeal of faster, complete XX clients appeal to minutes use Xx already

denial the overturn significantly generates when Create Altitude Additionally, appeal. rates are improving

current fuel interest our clients early-access for and and launch AI-powered the strong impact, will clients ROI appeal the in for these prospective believe in we Beyond market. for solution, denial automation reinforcing drive management incremental clients demand

solution, In management verification the addition we innovation eligibility verification. solutions, denial to financial unknown our automatically the verification faster, checks we insurance is accurate solution, In delivered denial patient or including enable to and introduced prior coverage ability authorization, eligibility more prevention-oriented eligibility streamline and clearance. within our additional secondary trigger to appeal detected, to further when

X X. experiencing Early In reimbursement to prior significantly automation reduced authorizations, benefits software prior of from authorization are of already we approvals, patient increased automation timely rate the the level provider auto clients minutes times submission of XX%, adopter care. the to and of which boost

our have measure risk. to as and proactively reinforced for industry cybersecurity we efforts need monitor, well. vigilant cybersecurity Recent events against mitigate in the work is as Waystar

cybersecurity ranked in experience is vendor #X competitors, independent innovation Waystar commitment innovation. our on the Our focus among client to reflected top as market data and and trusted an study our that recognizing protection,

goals. industry-best win time and invest rates us Clients client excellence, year with sustaining rapid direct long-term and competitors. our of client Demonstrating a during scores we as Waystar their exceptional against achieving team their successes. strong in delivered expansion, Finally, support they to trust satisfaction commitment because a partner

survey cycle the and strengthening care consider access client top level, confirms most service solutions. supporting management the is third-party position its ranking clearinghouse recent reflect clients patient earning best-in-class industry's focus the reason #X is the trusted and results in management leader. A as highest latest revenue vendors. on at that switching The providers our claims health Waystar

XXX and in future. a prospects, was "best survey for strong in of our having highest comprehensive Additionally, confidence Waystar its clients days reflecting ahead," ranked

by Companies, a they confidence can backed Waystar of strong needs. our America's recognitions us that choice Additionally, vendors Trusted meet These One thousands give of Forbes data for who honor trust Most a points. be of recognized their potential Waystar can as truly exceptional of hundreds evaluate are providers an to achievements team. direct they as These result

top where clients mile Best support thrives. members reflecting to members In existing December, and In Workplaces unpredictable performance to new an our by fostering XXXX, our of naming Healthcare, team Fortune Waystar Waystar industry commitment cultivate amid culture One we recognized and events. the environment the went the in extra team talent

driving We they proud fulfillment are Waystar's mission and forward. our of commitment in incredibly the that unwavering team's find

conclusion, XXXX vision with the future. In enters Waystar for clear purpose a momentum, and

We enduring disciplined affirm have growth double-digit compounding normalized adjusted revenue performance. and and EBITDA experienced low stable, our margin long-term delivering outlook growth, and of

shape We days the we ahead will we health do. care those best cycle indeed excited for future are the quo and and believe the and the continue transform We revenue disrupt about the work of to serve payments. status Waystar are

will that, I to With call hand discuss the financial the Steve, who will over details.

Steven Oreskovich

XX% quarter This the factors. primarily driven Revenue million. Matt. by fourth increased was growth Thanks, $XXX to year-over-year X in

to compounding successfully double-digit and our proven cross-sell our We clients. ability growth. of plan drive existing upsell normalized execute clients deliver includes strength the First, more revenue rate. and to software This of QX, continuing model business to XX of of low of to for year-over-year the the in an XX% $XXX,XXX growth than producing clients a increase the quarter expanded end LTM as number X,XXX with

helped side net XXX% continued the over on the volumes in we've which years. higher XXX% of Second, revenue experienced the XXX% the deliver a past retention is X high rate, This to QX. of trend

impacted million clients rapid the finally, above compared business And $X QX, XXXX full than of which first QX, million to model in from and in million implemented to $XX we year million $XX levels half generated in of existing QX growth. transactions $XX for X% faster our and clients, continued revenue clearinghouse of cyber normal the to equates implementations, These higher who in million the were along of QX, event. rapidly from revenue we competitor by year-over-year normal $X sustaining the in with recognize

revenue this results we is sustainable. the of significant quarters, growth confident this and timelines, have the in a implementation normal Under portion past of on increasingly we durable are Based X XXXX. recognized revenue would

the with low year-over-year item, last XXXX a acquisitions in between target for XXXX, double-digit The to normalized difference XXXX year-over-year timing our growth growth revenue rate the along impact the growth from and our rate X% as-reported X XX%. account of of of

quarter the net $XX $XX compared XXXX of for in fourth prior income of was million, a loss net year. million GAAP the to

a to for in compared of million, quarter $XX was of EBITDA loss $XX Adjusted net increased $XXX GAAP million loss the million XXXX, year full fourth year-over-year. the For XXXX. XX%

and to million, margin XX% the margin. Provider EBITDA a The from mix revenue On was in which year of full our continued This approximately approximately revenue for $XXX the adjusted full account XX% is adjusted in EBITDA business of slightly long-term target for a XXXX. reflects of the line XX%. year Solutions, higher basis, XX.X% continues investment reflecting with

full we repriced billion On plus expect by debt, lowering annually. basis which SOFR will the X.XX%, first expense $X.X us December save XX lien rate of our interest points XX, to of we

and also unused to SOFR X.XX%. $XXX million to capacity revolver We plus rate its increased our lowered

turn by net $XX XX-month approximately in million leverage quarter decreased On increase our balance our QX, debt EBITDA primarily at in adjusted a to from a the in million which year-end. cash the basis, $XXX is to ratio X/X of trailing X.Xx,

quarter $XX fourth the flow free Unlevered XXXX. cash of in was million

million, year the over XX%, For aligns the target. with free cash free up to $XXX our long-term of flows cash in brought conversion XXXX. the EBITDA million compared XX% half to to The year, flow unlevered the flow XXXX $XX strong was cash unlevered which second

Our familiar. to capital the same start very remain priorities sound and allocation may

to We delever X balance sheet, year. a expect to the turn continue targeting approximately

on business growth. our for disciplined will invest And to to acquisition top opportunities in criteria. growth look sustainable line at based we inorganic the continue We continue drive to

Turning to XXXX guidance.

X% $X.XXX We $X provided growth billion, revenue full a XX% which above is basis. year the normalized on billion and $X expect call. to preliminary on represents target At XXXX QX approaching billion this over the of we the midpoint,

in from outperforming Historically, low over take had contract discussed. previously very larger strong double-digit year, month. for our resulting XXXX, revenue onboarded in In growth, of In the months target to long-term contract for we first full reasons our realization. and, clients, in the solutions XXXX, the those clients near impacted realization signing full a days, we

have XXXX would on that based compared XXXX on to in recognized our an as-reported XX% revenue in benefit occurred guidance, timing XXXX, the for Normalizing basis. X% midpoint expect growth the we of

to with annual our growth client annual the for also X% historically rates recognizing higher be experienced, XXXX growth volume base in X% expect We XXXX. to consistent has were

please While quarterly provide not items. note we do the X guidance, following

a faster the expect We time generating the quarterly notably XXXX, higher half in first revenue to of for continue year-over-year noted growth QX. to rate most previously

we for of to the above such, growth quarter be at XXXX rates expect as-reported quarterly full As second and X% the would the guidance midpoint. overall year rate first

This also the first XX% be the half XXXX. for to means XXXX we slightly total experienced percentage the than in higher we of the generated expect revenue of in year approximately

software platform. within revenue the mentioned As XX% with of payments our processed patient we have on exists on associated there calls, prior seasonality

the to half reset annually see those latter of higher deductibles tend to and achieve the the in of high year typically Specifically, year. patients deductibles revenue as in deductible with compared half plans the second first the those dollars portion be

We shaping patient as payments growth quarterly expect revenue year-over-year in a rates. of XXXX XXXX, impact we to not this similar expect meaningfully would so

have $XXX to of to million range We guidance margin an of to XX%. equating EBITDA a million, adjusted EBITDA adjusted set $XXX

expectations generative adjusted development, continued EBITDA in include including for to excellence. cybersecurity go-to-market investments and initiatives Our software AI,

with as remain Additionally, XXXX. we percentage revenue consistent revenue a to of expect cost of

adjusted we back peers. with our and net non-GAAP intangible better majority effort the in amortization an income to calculations to Finally, add of align our non-GAAP EPS

year to from non-GAAP $XXX XX% over ranges June to these respectively, equating our At range $XXX represent with growth net EPS IPO. For $X.XX non-GAAP XXXX a and midpoints, of million, the to XXXX, of full $X.XX. to expect million of EPS in be we non-GAAP the XX% dilution income XXXX, having

We questions. are ready to answer your

Operator

first JPMorgan. Anne And coming Samuel question Instructions] the with is from line [Operator our of

Anne McCormick

just that. had quarter, were quarter really a drop Congrats really, you deductibles on seasonal a fourth into still volume-based quarter. the that performance said fourth heading your the off In despite great see was to you rolling But off. to expecting the revenue strong due

hoping normalized in we more was just with maybe rate of the your I what's the how utilization could around and reconcile So on expecting that happening volume-based that dynamics you maybe revenue, XXXX? talk about do you're

Steven Oreskovich

said, we to in patient This We deductibles. see, had volume-based based Thanks, sequentially had Anne. QX revenue the hit decline you quarter-over-quarter than if expect expected. less business, we did timing a payments look their patients Yes. on initially was is Steve. at actually of would QX, specific decline expected versus the which the That the when we to

information, patients would than to when So transparently it, have why X hit or and, swath timing many fourth either think not have the X while so those at hit belief in larger patients we otherwise seen we're in deductibles, of were it having seeing is there think the a better utilizing this don't otherwise performance deductibles, a a having time therefore, as system in we the years. that's we perfect our quarter the prior utilization, expected hitting point utilizing the have I from we not about in perspective and and that saw

The what annual within perspective. which second at continued what question, the higher back year growth saw we from a XXXX your that is expect think, a but we've part we the utilization 'XX, expect prior of X% was growth volume that versus recognize do we in We a XXXX, pertains to in in rates X% baseline XXXX expect we traditionally XXXX the seen, growth strong to over versus I year. XXXX. basis over And from

Operator

from ISI. next of the Anderson question line Elizabeth Evercore is with coming And our

Elizabeth Anderson

the just the ] about the [ update, you're then one, sort sure Health can Pay taking that payers? on just with was And assume and help Olive of us and pretty but quantify direct I connectivity think it graph I'm maybe you us, in contribution help you give contribution small, presentation. you seeing sort make of that maybe I of M&A the an Can you AI? two, had that to us some the how want vis-a-vis from

Matthew Hawkins

Matt. Elizabeth. is you, This Thank

our particularly already also to clearinghouse. say take with modern very further protocols question health providers, I'd direct me We're And for work network certainly software helps network expand with care is to using number payers. continues. connected house effort and, to focused Waystar's connections of think those that to were is first clearing payers to the even Let on it that than technical work that ensure payers, make Waystar ultimately, platform better exclusive patients. another previously is and and incremental directly our these about what that an We

ongoing. is to have that work a dedicated building out progress on the continue pleased this network. and so team We're make expansive focused And with we this

turn to I'll Steve the then it your for second question. part of And

Steven Oreskovich

revenue you're Slide correctly, year attributed what Elizabeth, X normalized you double-digit revenue could assume about new -- the growth from growth of we if that I'm the that speaking is deck annually. rate intent growth growth the And fiscal in low to we as rates XXXX put year-over-year X% versus a Yes. investor the in to out to this as year rates, actual -- acquisitions XXXX. we're remembering XX, I the called rate XXXX, see those And what versus we full illustrate in presentation slide expect of of the -- growth growth a having out of our reporting was we've there. partial versus 'XX,

we those that talked taking businesses our still would in and down, process to is an margin, that into overall software vast we're maybe those clients in of about the cycle, our it the and take past, from platform. step work we've opportunity to the move a further integrations and have generally finalizing them a single impacted as -- bit continued takes little and adjusted of speak XXXX. margins acquisitions all complete sorry, to expect expand EBITDA will those from intent the -- continue or I acquisition here we of believe we our of the in that vast X if we've longer the as majority say think Waystar on I majority how the would to acquired That in we those

areas allow profile talk it overall believe we we to those So initiatives order that in generally to help where us some opportunity we cost that's invest improve us We overall the allowing to of to improve of an profile in in has business. invest the the believe areas in 'XX look to of business. our that about other cost while of us other

Operator

line Our Richard is next question of Close from with the coming Canaccord.

Richard Close

for headwinds you thanks just tailwinds? about changes impact policy purchasing Matt, is medicaid to are on and funding what thinking come question. potential the how such? a and your for positioned? that be the would But of just and Waystar clients, D.C. out Congratulations maybe are and perspective your volumes decisions, lot how obviously, helpful But I wanted ACA. Any of on maybe to specifically, getting unknowns to going impact

Matthew Hawkins

you, Richard. I'd good It's a thank to foundational Well, Okay. couple hear things. of from you. say

care know. as the million and you payers different Waystar, we really does purpose our payers, commercial you Medicare we We our referenced. them And over with every the as setting, X as government as political administration. any environment of First, providers or well work all connect software, to Medicaid, across believe transcend

the can we negatively favorably. is We say And to We that using don't the to Rather, business that's on able and core deliver helpful. would foresee what think actually with. investment horizon very solutions to there's work we to providers a focus Waystar's we're be to in technology on that note that's we improvement. our that model. We return wasteful drive we Washington, central positioned D.C. the be closely would anything impact things on that spending tremendous to mission, And monitor eliminating

hundreds and software we're also hundreds modern based know, you able is quarter. of to As and deliver our on future each technology, improvements platform

in able to environment. meet move any be and that to of providers agile and quickly needs And allows navigate us the be so to

generally speaking, rate 'XX since very increased a resources as patients have think how Steve be what is year. that over do annual focused less. on this will or they about care providers, think from health environment, affirm But as do and a highlighted, do I more in uptick, providers XXXX, more patient I'd X% we same that growth expenditures of compound carrying see, see with visits on the We

to get so they're They expect solutions. want more going able And from their operating efficiency. to to be

So really efficiency spend. smart they're of can AI IT and deliver to utilization cybersecurity focused nicely. we gain. does we And value where and address They're I on Waystar, to in focused that's how possibly think kick address on use providers the what

increase solutions their We providers this of on note in that, expectation focused that on spend smart, IT as we a an market, look for an into based return and investment. expected XX% cite actual

see that Waystar for so And we as as don't see opportunity -- ahead. we look

Operator

Our coming Blair is with Jared Company. William from next line & question of the Haase

Jared Haase

point I on just a Jared ago momentum. Ryan and is this curious, Or to meaningfully or of is you and think priorities than the for I to just in on more the the on This if platform more the across modules resonate the any of in newer others just platform? terms put broad-based But Matt, second seeing of for maybe particular products fine some Congrats products hospitals. your today. some consumption solution all environment, Daniels. I'm you're areas alluded demand was curious of a

different here, kind ranking of specific hospital mind you're XXXX still areas? the priorities, beginning assume have solution top their hear lot for interested terms of incremental terms I of anything of investment any color there. Would be of And needs? cycle to in market a people. in more is any that shifting priorities seeing they're in rev But then you across how

Matthew Hawkins

We our please and begin strong XXXX. Ryan give as see demand we best Thanks, do well. as Jared,

visits and and hospitals more we and as do highlighted, see increase. to volume well. utilization ambulatory we've As know We modestly utilization increase of patient increasing system. volumes by more sustaining expect expect We and that to patient the visits

and and note seems same are more an an active do decision-makers stay the provider we efficiency also margin. highlight with decision-makers close As that to less, important part to market, in national and of the operating And or recent we, on that expected resources are emphasis again, with I'd the that organizations. in given conversation million And note claims negative about creates are $XX about these denied these denied it be these We there up claims burden to follow the trying organizations and any that impact claims. year. in of are spending appeal XXX billion to denied

burdens system. And in creates and so that inefficiency the

Your what question our software things highlighted relevant, modules about, was Waystar software on Waystar well, are claims the prevent denied platform earnings what from of in transcript even we those occurring. most that call types

as across denied AI leveraging indicate and likelihood increasingly automate the us highlight, in the first and and heard efficiency we're place. a that reduce to So more create gets our claim platform, you've

our So eligibility powerful. automation very suite is

to good. have help not ability to if care. who coverage individually work good access know come access. a not they a We have that coverage access it's Our may is hospital meaningful to patient even may know they to find when detect they for providers even It's patients that and insurance to

in that gets claim a But denied. reduces likelihood the that also, turn,

of our software use automation AI leveraging we prior claims, of And at authorization Our as generative that we well. area year, see appealing interest is in the also in -- we launched certainly, work denied the have interest. of around start as of certainly the

organizations the in we increasingly want. I'd to with XXXX And our the a to more want a what XXXX. say, year bring They what and than in efficiency platform as provider environment the demand pipeline they ability go-to-market with the is in to approach robust did we we face year start our like, efforts looking holistically, start of the we see approach.

and 'XX encouraged have that we're 'XX. momentum So forward into a we from of sense carry

Operator

Adam Goldman next line coming from with is Our question Sachs. Hotchkiss the

Adam Hotchkiss

Matt, that you're little of Change-related XX% pursuing wanted at elaborate maybe which all, guidance, into most the just more a claims. platform deeper pieces Could here? And just then and remittance on little in? bit a Steve, of the customers are for if to I dig cross-sell interested beyond how opportunities you customers the embedding on

Matthew Hawkins

Adam. Thanks,

establish had a I most of we cyber previous attack kind ours. XX,XXX morning, in engaged And due typical agreement. to we've And providers enduring this software software as Waystar it, competitor platform clients calls, noted about with signed would Waystar relationship here, those do, the highlighted in as we begin summarize over XX% already here As on software just join of platform. to additional an they've exploring the we on of we the are indicated would normally Waystar a that modules

productive teams As impacted having we types are go-to-market and those dedicated providers with impact who you'll that have attack. that that recall, cyber were by are fantastic and -- these conversations of those us the join were

base are of from upsell don't our with We across and of the specific broader using are consistent clients more they this it's that what we cross-sell, are used. on as software, our compounding a But believing more see disclose modules modules that our benefit focused perspective. there's using. focused incrementally on They we will that say software

denied. bring the help can a a will or follow does part patient of claim and at when intelligence are on rapidly automation, clearinghouse more from business themes be to seeing consistent: prevent the also them and that get on the appeal up and that do we efficiency. They're what looking process holistically the there. intelligence Anything And payments, superimposing denial and what derived help can claims understanding reimbursement focused

also our solutions. patient that a providers So we payment are these number have of evaluating

you the I'll And that again that momentum actually? would to encouraged XXXX. part Steve we into turn your Adam. repeat we're With question, carry question And it that, by of for the second

Adam Hotchkiss

upsell cross-sell, XXXX. factored how Yes, we was guidance in the the question for about into our

Matthew Hawkins

Okay.

Steven Oreskovich

Yes.

So net about quarter prepared the in revenue we Adam, talked of for as XXX%. we retention yes, rate you're the fourth comments, aware, have

to and we're And clients between we components specific these just perspective, those the years, look from we XXX% that bringing that the not on it one Over at cross-sell. a is there. past broad And as been it's to XXX%. several of opportunities, look at

the XXXX. opportunities client of have would expect in overall into we the base existing considered cross-sells aspect in So revenue derive them to from within we that the

up mentioned have one and is, at XX% any they're the revenue I all we And setting. provide the It of fully historically metric year. additional realization. with about will I clients that I existing think prior existing of contract year, implemented as that revenue we in mean solutions under beginning and that already doesn't year's start a that to

the we of that cyber XXXX the just about on And the brought Recognizing of at give guidance backlog. that that. we feel a I XX% with on provided, data was exist of revenue historically figure XXXX But little we're based different about was that the for numerous that really had what opportunity the a could just competitor's a full XX%. number as Some in XXXX, that was visibility and for good looking the as clients attack. that can a there, point I been providing result

Operator

Our Bank. next coming the is question George line Hill Deutsche with from

George Hill

core about if in mean, if love if you for that XXX% thought revenue Matt the XXXX I that of growth, might and slightly mix those footprint that most it you just, X in And captures I Steve, NRR, I'm call talk care, guide, it new growth we as versus ask attribute recognize as Steve, look different the versus gains the at could price XXXX basically XXXX. but guess, health guys I going you is of I and growth way. wallet was growth of wondering share the we about, have a to product which buckets. question kind the would like volume I'll

guys are comment extending what Matt, I'd quality. erosion credit anything it there, seeing for just then are any stays you guys in love And payable patient patient on you you like or like second seeing if that? And could a

Matthew Hawkins

Yes.

we indicate, know, about while you just me market talk addressable software a of the with pursuit Let modules into very don't start ours, necessarily large opportunity. year we are specific as -- we

to for to health believe momentum establishing the well have just a the we're the the given -- focused system time We opportunity. that is relevant very that sales very that covers for our ambulatory clients a as be that meaningful important right we opportunity software serve. we as And organization and now

And to of Steve, part question. the you second for the I'll it turn

Steven Oreskovich

we've just little on George. gross past, down I'll little sort We there more talked versus bridge net specific opportunity of context to of to helpful. is Yes. I can cross-sell from retention, and the I for asking it the in what the bit can a would be specifically What don't the reiterate, give other -- breaking hopefully, and do I know and provide about retention some you're question, appreciate that revenue indications maybe aspects. revenue a

and very past to strong the approximately over volumes combination And have, you as years, to retention rate component a started revenue bridge price gross increases, indicated, XX%. a or with cross-sell. it's of net then We several of a retention,

the that providers. care volumes, the side visits to XXX% X primarily fourth of for specifically its core to the we was at years, patient derived which XXX% on continued commented quarter, we've higher from high experienced health For XXX%, which the due is past are to the

was increases that a leading retention component rate driver the price was between revenue was cross-sell the of was obviously, the of where XXX% overall sometimes CPI And years, net X those probably prior out XXX%. driving components. the in period during higher, and said, That

We of in also a did quarter. to we guess a us slide like maintain the ability reliant having I'll add, we the And new while have the be include X not that allow to deck on overly any consistently this components them. fact IR NRR high that I one

revenue, I of volume-based volume because between the we so I breaks think think down lot. far mentioned a components X, have subscription word of it's the Slide call and this -- that revenue kind revenue on we've

So remind everybody years, base like as the derived revenue, very from our subscription XX% we to of consistently, X the much take past we moment which over to well. revenue that would like I

Matthew Hawkins

we that side and high note also volume business outlook. I'd have visibility just affirm our the to our of

question this patient don't a comment asked and about we You'd on that time. won't -- we at credit,

Operator

Our with line James. next is coming the question Brian from Peterson Raymond of

Johnathan McCary

This is Johnathan McCary on for Brian.

increasingly in complex Waystar last invited RFPs. the about heard quarter we So being table to

a has traction than last. with curious, I year and you stronger more up into pipeline providers this larger that know picked just and complex So systems noted XXXX?

$XXX,XXX that are portion just So historically pipeline seeing. deal a of the a curious you is trend if becoming is larger all than

Matthew Hawkins

hospitals pipeline. in opportunities. we or into don't would Johnathan. within is and necessarily say our you, details unpack nice systems, go seeing the momentum which Thank that What be we're to larger We health tend

on strong would start We we of start the XXXX with the XXXX. ambulatory also that year side opportunity, And than of strong our business. again in a just higher momentum emphasize was seeing are again, I once the pipeline at of it

a momentum. We sense of have

studies prospects folks achieve and that satisfaction utilize recent we generating. as We've clients. return in and as go-to-market examples built to case we platform. our with and that really the introduce encouraged prospects and Waystar we're relevant revenue -- surveys client they we to and software on cycle investments to we're by cover in utilizing transcript particular. pleased industry client so also nice engage clients the can that we've from And scores evaluate highlighted And speak, of library, use advocacy they that the a work in And third-party we our

We brand start And feel and recognition with sales in discussions clients. good been awareness all things And establish conversations we've the with 'XX. those and the to that year about sense carry focused the our in on and just we able us executing of plan. forward our trust

Operator

Allen from Lutz line Our with America. question Bank coming is the of next of

Allen Lutz

about Matt customer quarters? as XX-month for they'd in to Is over X XX taking the benefit back The or I One the much you've seen past side, be sales quarter-over-quarter. think, Steve. the first past on bifurcate type for systems would cycle of between any the you've to flat to ambulatory health that benefit and here, Change more a a relates to there talked very And Change ambulatory just would health willing was way it quickly. be step move systems. the

that -- you've Is And as into as so think benefit maybe wasn't right to XXXX? into look we to opportunity maybe the is where seen opportunity like the the before. that seems more benefit about and coming way it opportunity maybe that a date for you near-term it

Steven Oreskovich

question, for Yes. the Thanks Allen. This is Steve.

So both right from to We base If it. majority, ambulatory as gauge you that as way trying system see a health I say that nice the think, that moving broadly, as to the would stated, your did the are well majority, ambulatory. initial we characterization hospital about mix client the was -- think is of side. was on and clients the I

that and for us. think other in sorry, of in past of referenced, potential the clients the talk a storm some better system we clients, were to, I cash that had the activity do opportunity in that an see that clients, term, their prospective starting health front talked hit is, -- that talked the lack either to you about as point flows. X initial able hospital weather to prior of of or we're see from of the and part to to continue to as we're -- calls, phase That's that we've we about

Operator

next Kalia of Our coming Barclays. question from line Saket the with

Saket Kalia

Okay. finish maybe Matt, you, go back for to bit. nice the theme pipeline just to little the to year. a

in that of here, the XXXX? competitive wins Given think those the you of of consistent had land-and-expand pipeline how some you kind motion about into cross-sell do

know in you but directionally, And talked NRR how Steve, about relatedly for NRR, about should components maybe XXXX? we you, the think of maybe I

Matthew Hawkins

Yes.

know, -- with we enduring We you, Saket. then where we, you over clients. these land time, long We a and approach relationship. thank have client we land-and-expand do with relationships create a expand So that as

has years. so And business that's a something our been for that's many and motion natural part of

us speaking providers now were about natural the to this attack. is to feel that up do disrupted again, them. a doing by with joined is with We The phenomenon these -- they follow we work us you're because cyber for that that very the, thing good unique to that where we're

in transcript, continue on to we'll more add those elsewhere We number that the believe exploring additional software call providers, software seen approximately will to software. and And so as we've and as earlier of we highlighted across in grow, platform. our our earnings XX% usage platform occur engaged are our

there's there automation that know know software a used. more our software. our as occurs than We is that one more of and modules of that get use We benefit as and more providers insight

ROI. patient our using is which, also incremental more For you're suite, our market-leading, benefit again, clearinghouse, you're and if example, access using getting more and and

conversations And we client specific so with having start that client and base doing total been the those impacted, more work as but that very the XX,XXX good we're providers the that feel year. we're within than about the actively, highlighted, have our you base,

Steven Oreskovich

for volumes all was XXX% the by revenue that in a retention that XXXX. we to here you rate I ask historically the in we fourth of seen, that volume couple higher But prepared give Steve, in just XXXX, the our the X%, what that metric. know I XXXX. don't out a of help guidance specific did, that this -- number X% rate that we've over together and of a by Yes. indicate we we about question, how think driven for for on it the and items comments, And saw can since quarter, is Saket, versus do think in did growth that kind directionally, the to guidance your second continued I see would helped higher triangulate year-over-year didn't it. you of rate we appreciate we you And there, in net

helpful that's you. hopefully, to So

Operator

call I the at are time, turn there the further back as in remarks. any Matt for And queue Hawkins will to this closing now no questions over

Matthew Hawkins

Thank We're Olivia. this morning. doing you, call from Utah earnings our office this

the over watching mountains, we 'XX. and come always and snowcapped and conviction the think joy brings we're light of we're that about doing. we a up how sense symbolic of brings sun -- feel It of what So opportunity that's

here. as So nice look our that's office window I a visual out

so setting, remarkable just who hero this moment our incredible to provider to to grateful take thank clients our members we and in feel Waystar team to, serve. want I and a

do. plan our on the health of that you've And executing our low we target work we're performance year, build revenue our deliver margins. by of software and strong in heard to on this people the and feel to growth focused us about clients, payments double-digit develop delight ability game build to ahead excited our achieving execute EBITDA our in just mission adjusted and We're mention great and around a reaffirm to XX% We're We to simplify in care as and encouraged opportunities us, XXXX. XXXX. target strong team, focused confident

us day. being to forward for with we'll hope you all you thank you. a have today. So great that joining We And touch in look

Operator

for call. conference your Thank you today's concludes participation. This

You may now disconnect.

Waystar Holding (WAY) 18 Feb 252024 Q4 Earnings call transcript