On the valuation front, the picture is mixed. My conservative DCF valuation estimate pegged it at $26.46, which does not have the minimum 10% margin of safety that I demand before I am a conservative yet opportunistic value investor who has been investing since 2005. I am fact-driven, preferring to let financial data inform me of a company's health, followed by qualitative analysis to fill in the gaps to paint a holistic picture of a company's growth prospects.My work is published on two platforms, Seeking ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark One) ☒ Quarterly Report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the quarterly period ended June 30, 2025 ☐ Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 Commission File No.: 000-27701 HealthStream, Inc. (Exact name of registrant as specified in its charter) Tennessee 62-1443555 (State or other jurisdiction of incorporation or organization) 500 ...

Financial Data and Key Metrics Changes - The company achieved record quarterly revenue of $74.4 million, up 4% from the same quarter last year [6][24] - Operating income increased by 33.4% to $5.9 million, while net income rose by 29.3% to $5.4 million [6][25] - Adjusted EBITDA was reported at $17.6 million, reflecting an 11.3% increase [6][29] - Subscription product revenues grew by 4.2%, while professional service revenues declined by 3.5% [25] Business Line Data and Key Metrics Changes - Credential Stream revenue grew by 26%, Shift Wizard by 21%, and Competency Suite by 18% [26] - Legacy products in credentialing and scheduling saw a decline totaling $1.8 million compared to last year [26] - Excluding legacy products, the core business grew over 8% in the quarter [26] Market Data and Key Metrics Changes - Remaining performance obligations were $618 million, up from $538 million year-over-year, with expectations of 39% conversion to revenue in the next 12 months [26] - The company maintains a strong cash balance of $90.6 million and has no interest-bearing debt [23][29] Company Strategy and Development Direction - The company is transitioning from SaaS applications to a PaaS architecture to enhance interoperability [21] - HealthStream is focused on utilizing AI to improve efficiency and create competitive differentiation across its product offerings [13][14] - The launch of the HealthStream Learning Experience (HLX) aims to provide personalized self-directed learning pathways for healthcare professionals [17][39] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the sales pipeline and macroeconomic conditions, noting that four out of five anticipated deals were signed in the second quarter [8][52] - The company is well-positioned to help customers navigate new healthcare policies and improve workflow efficiency [51][52] - Management anticipates continued growth in healthcare employment over the next five years despite some challenges in specific segments [78][80] Other Important Information - The company holds 20 patents and has received over 40 Brandon Hall awards for excellence in learning and development [22] - A quarterly cash dividend of 3.1 cents per share was declared, to be paid on August 29 [33] Q&A Session Summary Question: Will gross margins bounce back in Q3? - Management expects gross margins to hover around 65% for the remainder of the year due to ongoing costs related to scaling and performance improvements [58][59] Question: What does the pipeline look like for the HLX platform? - The HLX is now a revenue-generating product, and the company is beginning to build a pipeline for it, expecting steady incremental growth [60][61][62] Question: Can you elaborate on Shift Wizard and legacy products? - The growth of Shift Wizard is now surpassing the decline of legacy products, and the offset from legacy products is expected to diminish in the coming quarters [68][70] Question: Was there any reputational damage from the scaling issues in CredentialStream? - While there was some frustration among customers, management believes the impact will be minimal and is focused on improving capacity and service [73][76] Question: How does the healthcare employment market impact HealthStream? - Overall healthcare employment is expected to grow, and while there may be challenges in specific segments, the demand for healthcare services remains strong [78][80] Question: How are price escalators being integrated into contracts? - Price escalators are being included in new and renewed contracts, and negotiations are generally reasonable [87][88] Question: Can you provide an update on NurseGrid's performance? - NurseGrid is generating over $50,000 a month in revenue through its new monetization strategies, and the user base continues to grow [90][93]

The company's recent strategic focus centers on growing its platform-based software-as-a-service (SaaS) subscription business. Strength in integrated suites—offering bundled education, scheduling, and credential tools—has been key. HealthStream's ability to address industry-wide staff shortages, ensure regulatory compliance, and leverage its cloud-based ecosystem are critical to sustaining long-term growth. Success relies on driving partners to its core platform, executing product migrations, and maintainin ...

Core Viewpoint - HealthStream (HSTM) reported quarterly earnings of $0.18 per share, exceeding the Zacks Consensus Estimate of $0.16 per share, and showing an increase from $0.14 per share a year ago [1][2] Financial Performance - The earnings surprise for the quarter was +12.50%, with the company having surpassed consensus EPS estimates three times over the last four quarters [2] - HealthStream's revenues for the quarter ended June 2025 were $74.4 million, which missed the Zacks Consensus Estimate by 0.49%, compared to $71.56 million in the same quarter last year [3] - The company has only topped consensus revenue estimates once in the last four quarters [3] Stock Performance - HealthStream shares have declined approximately 19.3% since the beginning of the year, while the S&P 500 has gained 6.1% [4] - The current Zacks Rank for HealthStream is 3 (Hold), indicating expected performance in line with the market in the near future [7] Future Outlook - The consensus EPS estimate for the upcoming quarter is $0.17 on revenues of $75.88 million, and for the current fiscal year, it is $0.65 on revenues of $300.55 million [8] - The outlook for the Internet - Services industry, to which HealthStream belongs, is currently in the bottom 30% of over 250 Zacks industries, which may impact stock performance [9]

[Earnings Release Overview](index=1&type=section&id=HEALTHSTREAM%20ANNOUNCES%20SECOND%20QUARTER%202025%20RESULTS) HealthStream announced its second quarter 2025 results, highlighting key financial achievements and capital allocation activities [Second Quarter 2025 Key Highlights](index=1&type=section&id=Second%20Quarter%202025%20Key%20Highlights) HealthStream announced record quarterly revenues and significant year-over-year increases across key financial metrics for Q2 2025, alongside capital allocation activities including share repurchases and a quarterly dividend declaration Second Quarter 2025 Financial Highlights (YoY) | Metric | Q2 2025 (Millions) | Q2 2024 (Millions) | Growth (%) | | :---------------- | :----------------- | :----------------- | :--------- | | Revenues | $74.4 | $71.6 | 4.0% | | Operating Income | $5.9 | $4.4 | 33.4% | | Net Income | $5.4 | $4.2 | 29.3% | | Diluted EPS | $0.18 | $0.14 | N/A | | Adjusted EBITDA | $17.6 | $15.8 | 11.3% | - The Board of Directors authorized a share repurchase program on May 8, 2025, to repurchase up to **$25.0 million** of outstanding common stock, with **$18.1 million** repurchased during the second quarter[7](index=7&type=chunk) - A quarterly cash dividend of **$0.031 per share** was declared, payable on August 29, 2025[7](index=7&type=chunk) [CEO Commentary](index=2&type=section&id=Commenting%20on%20HealthStream%27s%20results) CEO Robert A. Frist, Jr. highlighted the strong financial performance in the second quarter of 2025, including record quarterly revenues, and expressed confidence in HealthStream's solutions to continue aiding healthcare organizations in achieving greater workflow efficiencies - CEO Robert A. Frist, Jr. noted record quarterly revenues of **$74.4 million**, up **four percent** year-over-year, and stated that HealthStream's solutions are well-positioned to help healthcare organizations achieve greater workflow efficiencies[15](index=15&type=chunk) [Financial Performance Analysis](index=1&type=section&id=Financial%20Results) This section provides a detailed analysis of HealthStream's financial performance for Q2 and year-to-date 2025, including revenue, profitability, and financial position [Second Quarter 2025 Results](index=1&type=section&id=Second%20Quarter%202025%20Compared%20to%20Second%20Quarter%202024) HealthStream reported strong Q2 2025 financial results with revenue growth primarily driven by subscription services, and significant improvements in operating income, net income, and EPS due to increased revenues, sublease income, and lower bad debt expense, partially offset by higher investment-related expenses [Revenue Performance](index=1&type=section&id=Revenues%20for%20the%20second%20quarter%20of%202025) Total revenues for Q2 2025 increased by 4.0% year-over-year to $74.4 million, setting a new company record, primarily driven by a 4.2% increase in subscription revenues Q2 2025 Revenue Breakdown (YoY) | Metric | Q2 2025 (Millions) | Q2 2024 (Millions) | Change (Millions) | Growth (%) | | :-------------------- | :----------------- | :----------------- | :---------------- | :--------- | | Total Revenues | $74.4 | $71.6 | $2.8 | 4.0% | | Subscription Revenues | N/A | N/A | $2.9 | 4.2% | | Professional Services | N/A | N/A | ($0.1) | N/A | [Profitability and EPS](index=1&type=section&id=Operating%20income%20was%20%245.9%20million) Operating income surged by 33.4%, net income by 29.3%, and diluted EPS by 28.6% in Q2 2025, benefiting from revenue growth, sublease income, and reduced bad debt expense, despite increased investments in platform and SaaS applications Q2 2025 Profitability and EPS (YoY) | Metric | Q2 2025 (Millions) | Q2 2024 (Millions) | Growth (%) | | :---------------- | :----------------- | :----------------- | :--------- | | Operating Income | $5.9 | $4.4 | 33.4% | | Net Income | $5.4 | $4.2 | 29.3% | | Diluted EPS | $0.18 | $0.14 | 28.6% | - The improvement in operating income was primarily attributable to increased revenues, sublease income, and lower bad debt expense, partially offset by higher expenses for investments in platform and SaaS applications[4](index=4&type=chunk) [Year-to-Date 2025 Results](index=2&type=section&id=Year-to-Date%202025%20Compared%20to%20Year-to-Date%202024) For the first six months of 2025, HealthStream reported modest year-over-year increases across key financial metrics, with revenues up 2.5%, operating income up 1.6%, and Adjusted EBITDA up 2.8%, driven by similar factors as the quarterly results Year-to-Date 2025 Financial Performance (YoY) | Metric | YTD 2025 (Millions) | YTD 2024 (Millions) | Growth (%) | | :---------------- | :------------------ | :------------------ | :--------- | | Revenues | $147.9 | $144.3 | 2.5% | | Operating Income | $10.3 | $10.1 | 1.6% | | Net Income | $9.7 | $9.4 | N/A | | Diluted EPS | $0.32 | $0.31 | N/A | | Adjusted EBITDA | $33.8 | $32.9 | 2.8% | - The increase in year-to-date operating income was primarily due to higher revenues, sublease income, and lower bad debt expense, partially offset by increased expenses for platform and SaaS application investments[9](index=9&type=chunk) [Financial Position and Capital Expenditures](index=2&type=section&id=At%20June%2030%2C%202025%2C%20the%20Company%20had%20cash) As of June 30, 2025, HealthStream maintained a strong liquidity position with $90.6 million in cash, cash equivalents, and marketable securities, and no outstanding indebtedness. Capital expenditures for the second quarter were $9.2 million - Cash, cash equivalents, and marketable securities totaled **$90.6 million** as of June 30, 2025[8](index=8&type=chunk) - The Company does not have any outstanding indebtedness from borrowed money[8](index=8&type=chunk) - Capital expenditures incurred during the second quarter of 2025 were **$9.2 million**[8](index=8&type=chunk) [Capital Allocation and Corporate Actions](index=2&type=section&id=Other%20Business%20Updates) This section details HealthStream's capital allocation strategies, including its share repurchase program and quarterly cash dividend declarations [Share Repurchase Program](index=2&type=section&id=On%20May%208%2C%202025%2C%20the%20Company%20announced%20a%20share%20repurchase%20program) HealthStream's Board authorized a $25.0 million share repurchase program, under which $18.1 million was repurchased in Q2 2025, and the program was completed in July with an additional $6.9 million in repurchases - The Board of Directors authorized a share repurchase program on May 8, 2025, to repurchase up to **$25.0 million** of outstanding common stock[10](index=10&type=chunk) - **$18.1 million** in shares were repurchased during the second quarter of 2025 pursuant to this authorization[10](index=10&type=chunk) - The program was completed in July by repurchasing shares valued at **$6.9 million**, exhausting the maximum dollar amount[10](index=10&type=chunk) [Quarterly Cash Dividend](index=2&type=section&id=On%20August%204%2C%202025%2C%20the%20Board%20of%20Directors%20approved%20a%20quarterly%20cash%20dividend) The Board of Directors declared a quarterly cash dividend of $0.031 per share, payable on August 29, 2025, to shareholders of record on August 18, 2025 - A quarterly cash dividend of **$0.031 per share** was approved by the Board of Directors on August 4, 2025[11](index=11&type=chunk) - The dividend is payable on August 29, 2025, to holders of record on August 18, 2025[11](index=11&type=chunk) [Financial Outlook for 2025](index=2&type=section&id=Financial%20Outlook%20for%202025) HealthStream updated its full-year 2025 guidance, raising the expected net income range while maintaining revenue, Adjusted EBITDA, and capital expenditure projections. The guidance excludes impacts from potential acquisitions/dispositions or changes in non-marketable equity investments Full Year 2025 Guidance | Metric | Low (Millions) | High (Millions) | Previous Net Income Guidance (Millions) | | :-------------------- | :------------- | :-------------- | :-------------------------------------- | | Revenue | $297.5 | $303.5 | N/A | | Net Income | $19.5 | $22.4 | $18.6 to $21.0 | | Adjusted EBITDA | $68.5 | $72.5 | N/A | | Capital Expenditures | $31.0 | $34.0 | N/A | - The updated guidance for 2025 reflects the Company's assumptions regarding new sales and renewals[14](index=14&type=chunk) - This consolidated guidance does not include the impact of any acquisitions or dispositions, gains or losses from changes in fair value of non-marketable equity investments, or impairment of long-lived assets[14](index=14&type=chunk) [Conference Call Information](index=3&type=section&id=A%20conference%20call%20with%20Robert%20A.%20Frist%2C%20Jr.) HealthStream will host a conference call on Tuesday, August 5, 2025, at 9:00 a.m. (ET) to discuss the results, with webcast and telephone access details provided. A replay will be archived on the company's website - A conference call will be held on Tuesday, August 5, 2025, at **9:00 a.m. (ET)**[16](index=16&type=chunk) - Participants can access the live conference call via webcast or by registering for telephone access[16](index=16&type=chunk) - A replay of the conference call and webcast will be archived on the Company's website in the Investor Relations section[16](index=16&type=chunk) [Non-GAAP Financial Measures](index=3&type=section&id=Use%20of%20Non-GAAP%20Financial%20Measures) This section defines HealthStream's non-GAAP financial measures, primarily Adjusted EBITDA, and provides reconciliations to comparable GAAP measures for transparency [Definition and Rationale](index=3&type=section&id=This%20press%20release%20presents%20adjusted%20EBITDA) HealthStream utilizes Adjusted EBITDA, a non-GAAP financial measure, to evaluate its operating performance by adjusting net income for certain non-cash and non-operating items, believing it provides a useful and comparable view of the underlying business - Adjusted EBITDA is defined as net income before interest, income taxes, stock-based compensation, depreciation and amortization, and changes in fair value of non-marketable equity investments[17](index=17&type=chunk) - Management believes Adjusted EBITDA is useful for evaluating ongoing operating performance and comparing performance between periods, as it adjusts for certain GAAP accounting, non-cash, and/or non-operating items[17](index=17&type=chunk) - Adjusted EBITDA is a non-GAAP measure and should not be considered a substitute for, or superior to, GAAP measures, and may not be comparable to similarly titled measures of other companies[18](index=18&type=chunk)[19](index=19&type=chunk) [Reconciliation of Adjusted EBITDA](index=7&type=section&id=Reconciliation%20of%20GAAP%20to%20Non-GAAP%20Financial%20Measures%281%29) HealthStream provides detailed reconciliations of Adjusted EBITDA to net income for both the reported quarterly and year-to-date periods, as well as for the full-year 2025 financial outlook, to ensure transparency with GAAP measures [Quarterly and Year-to-Date Reconciliation](index=7&type=section&id=Operating%20Results%20Summary) This section presents the reconciliation of GAAP net income to Adjusted EBITDA for the three and six months ended June 30, 2025, and 2024, detailing the specific adjustments made Adjusted EBITDA Reconciliation (Q2 & YTD) | Metric | Q2 2025 (Thousands) | Q2 2024 (Thousands) | YTD 2025 (Thousands) | YTD 2024 (Thousands) | | :-------------------------- | :------------------ | :------------------ | :------------------- | :------------------- | | GAAP net income | $5,389 | $4,168 | $9,721 | $9,394 | | Interest income | (958) | (944) | (1,889) | (1,848) | | Interest expense | 25 | 25 | 50 | 49 | | Income tax provision | 1,478 | 1,132 | 2,393 | 2,448 | | Stock-based compensation | 836 | 1,094 | 1,940 | 2,154 | | Depreciation & amortization | 10,867 | 10,370 | 21,621 | 20,706 | | **Adjusted EBITDA** | **$17,637** | **$15,845** | **$33,836** | **$32,903** | [2025 Outlook Reconciliation](index=8&type=section&id=Financial%20Outlook%20for%202025) This section provides the reconciliation of projected net income to projected Adjusted EBITDA for the full year 2025 guidance, detailing the anticipated adjustments 2025 Financial Outlook Reconciliation to Adjusted EBITDA | Metric | Low (Thousands) | High (Thousands) | | :-------------------------- | :-------------- | :--------------- | | Net income | $19,500 | $22,400 | | Interest income | (3,300) | (3,500) | | Interest expense | 100 | 100 | | Income tax provision | 5,200 | 6,000 | | Stock-based compensation | 4,000 | 4,300 | | Depreciation & amortization | 43,000 | 43,200 | | **Adjusted EBITDA** | **$68,500** | **$72,500** | [About HealthStream](index=3&type=section&id=About%20HealthStream) HealthStream is a leading healthcare technology platform company that provides workforce solutions, empowering healthcare professionals and operating the industry's largest ecosystem of platform-delivered solutions for patient care excellence - HealthStream (Nasdaq: HSTM) is a leading healthcare technology platform company for workforce solutions[1](index=1&type=chunk)[20](index=20&type=chunk) - It is the healthcare industry's largest ecosystem of platform-delivered workforce solutions[20](index=20&type=chunk) - The company's mission is to empower healthcare professionals to deliver excellence in patient care[20](index=20&type=chunk) [Condensed Consolidated Financial Statements](index=4&type=section&id=HEALTHSTREAM%2C%20INC.%20Condensed%20Consolidated%20Statements%20of%20Income) This section presents HealthStream's unaudited condensed consolidated statements of income, balance sheets, and cash flows for the reported periods [Condensed Consolidated Statements of Income](index=4&type=section&id=Condensed%20Consolidated%20Statements%20of%20Income) This section presents the unaudited condensed consolidated statements of income for the three and six months ended June 30, 2025, and 2024, detailing revenues, operating costs and expenses, operating income, and net income Condensed Consolidated Statements of Income (Selected Data, in thousands) | Metric | Q2 2025 | Q2 2024 | YTD 2025 | YTD 2024 | | :------------------------------------ | :------ | :------ | :------- | :------- | | Revenues, net | $74,396 | $71,556 | $147,881 | $144,316 | | Total operating costs and expenses | $68,510 | $67,145 | $137,617 | $134,215 | | Operating income | $5,886 | $4,411 | $10,264 | $10,101 | | Net income | $5,389 | $4,168 | $9,721 | $9,394 | | Diluted Net income per share | $0.18 | $0.14 | $0.32 | $0.31 | | Dividends declared per share | $0.031 | $0.028 | $0.062 | $0.056 | [Condensed Consolidated Balance Sheets](index=5&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) This section provides the unaudited condensed consolidated balance sheets as of June 30, 2025, and December 31, 2024, outlining the company's assets, liabilities, and shareholders' equity Condensed Consolidated Balance Sheets (Selected Data, in thousands) | Metric | June 30, 2025 | December 31, 2024 | | :-------------------------- | :------------ | :---------------- | | Total assets | $500,148 | $510,766 | | Total liabilities | $149,581 | $151,411 | | Total shareholders' equity | $350,567 | $359,355 | [Condensed Consolidated Statements of Cash Flows](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) This section presents the unaudited condensed consolidated statements of cash flows for the six months ended June 30, 2025, and 2024, detailing cash flows from operating, investing, and financing activities Condensed Consolidated Statements of Cash Flows (Selected Data, in thousands) | Metric | YTD 2025 | YTD 2024 | | :------------------------------------ | :------- | :------- | | Net cash provided by operating activities | $32,097 | $27,389 | | Net cash used in investing activities | ($18,399) | ($19,031) | | Net cash used in financing activities | ($21,086) | ($2,561) | | Net (decrease) increase in cash and cash equivalents | ($7,367) | $5,798 | | Cash and cash equivalents at end of period | $52,102 | $46,131 | [Forward-Looking Statements](index=9&type=section&id=This%20press%20release%20includes%20certain%20forward-looking%20statements) This section contains a standard disclaimer regarding forward-looking statements, cautioning that actual results may differ materially due to various known and unknown risks and uncertainties, and the company undertakes no obligation to update these statements - The press release includes forward-looking statements regarding expectations for financial performance and dividend policy for 2025, which involve risks and uncertainties[31](index=31&type=chunk) - Actual results, performance, or achievements may be materially different from those expressed or implied by forward-looking statements due to factors such as negative economic conditions, changes in U.S. policy, adverse healthcare industry developments, and geopolitical instability[31](index=31&type=chunk) - Readers should not place undue reliance on forward-looking statements, and the Company undertakes no obligation to update or revise them[31](index=31&type=chunk)

Company Overview - HealthStream is a market leader in workforce solutions for U S healthcare organizations, focusing on learning, credentialing, and scheduling [18] - The company serves the highly regulated healthcare industry, which faces challenges in improving patient safety and workforce retention [18] - HealthStream's vision is to improve the quality of healthcare by developing the people who deliver care, with 96% of employees reporting that the vision inspires their performance [6, 9] Financial Performance - In Q1 2025, HealthStream's revenues reached $73 5 million, with an adjusted EBITDA of $16 2 million [18] - For FY 2024, the company reported revenues of $291 6 million and an adjusted EBITDA of $66 8 million [18] - The company has a strong balance sheet with $113 3 million in cash as of Q1 2025 and no debt [18] Market and Growth Strategies - HealthStream is expanding its total addressable market by targeting 1,000+ nursing schools and 1,000,000+ nursing students [33] - The company's growth strategies include expanding its customer network, increasing the value of each account through cross-selling, and growing new revenue streams via partners and PaaS capabilities [38] - The total addressable market (TAM) is 12,600,000 individuals focused on healthcare delivery [29]

(Mark One) UNITED STATES SECURITIES AND EXCHANGE COMMISSION ☒ Quarterly Report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 Washington, D.C. 20549 For the quarterly period ended March 31, 2025 FORM 10-Q ☐ Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 Commission File No.: 000-27701 HealthStream, Inc. (Exact name of registrant as specified in its charter) Tennessee 62-1443555 (State or other jurisdiction of incorporation or organization) 500 ...

Core Viewpoint - HealthStream (HSTM) has experienced a significant downtrend, with a 13.2% decline over the past four weeks, but it is now in oversold territory, suggesting a potential turnaround due to analysts' positive earnings outlook [1] Group 1: Stock Performance - HSTM's stock has faced heavy selling pressure, leading to a decline of 13.2% in the last month [1] - The stock's Relative Strength Index (RSI) is currently at 25.2, indicating it is oversold and may soon reverse its trend [5] Group 2: Analyst Sentiment - There is a strong consensus among sell-side analysts regarding HSTM's ability to exceed previous earnings estimates, with a 0.5% increase in the consensus EPS estimate over the last 30 days [7] - HSTM holds a Zacks Rank 2 (Buy), placing it in the top 20% of over 4,000 ranked stocks based on earnings estimate revisions and EPS surprises, indicating a favorable outlook for a potential rebound [8]

Financial Data and Key Metrics Changes - Revenues for the first quarter were $73.5 million, up 1% year-over-year [38] - Operating income decreased by 23.1% to $4.4 million [38] - Net income was $4.3 million, down 17.1% [38] - EPS decreased from $0.17 to $0.14 [38] - Adjusted EBITDA was $16.2 million, down 5% [38] Business Line Data and Key Metrics Changes - Credential Stream revenue grew by 25% year-over-year [41][54] - Shift Wizard revenue increased by 19% [41][52] - Competency Suite revenue rose by 12% [41] - Core business, excluding legacy products and customer bankruptcy impacts, grew over 6% [41] Market Data and Key Metrics Changes - Remaining performance obligations were $613 million, up from $514 million year-over-year [42] - Gross margin decreased to 65.3% from 66.2% [42] - Days sales outstanding improved to 37 days from 46 days year-over-year [44] Company Strategy and Development Direction - The company is focused on developing, credentialing, and scheduling the healthcare workforce through SaaS solutions [30] - Emphasis on the interoperability of core applications through the hStream platform [30] - The company aims to bundle value to address mandatory requirements in healthcare [75] Management's Comments on Operating Environment and Future Outlook - Management acknowledged macroeconomic headwinds affecting purchasing decisions, particularly for elective content [9][10] - Despite challenges, management remains optimistic about revenue and EBITDA growth year-over-year [8] - Revised guidance reflects a cautious outlook due to delays in medium-sized deals and technology scaling issues [26][36] Other Important Information - The company has a strong cash balance of $113.3 million and no interest-bearing debt [33][44] - A quarterly cash dividend of $0.031 per share was declared [48] - The company maintains an active pipeline for potential acquisitions [47] Q&A Session Summary Question: How much of the portfolio is required versus elective? - Management indicated that the majority of products are tied to some form of requirement, estimating around 80% to 90% [80][86] Question: Was the largest contract a renewal or new business? - The largest contract was new business, involving a significant health system that had not previously used the company's learning management system [90][91] Question: What is the status of legacy products? - Legacy products are still supported but not actively sold, with a focus on transitioning customers to newer solutions [100]