Financial Performance - Waystar Holding Corp reported Q2 revenue of $270.7 million, reflecting a 15% year-over-year growth [1][6] - The net income for Q2 was $32.2 million, with a net income margin of 12% [1][6] - Non-GAAP net income for Q2 was $65.7 million, translating to a non-GAAP net income per diluted share of $0.36 [6][31] - Adjusted EBITDA for Q2 was $112.6 million, with an adjusted EBITDA margin of 42% [1][6] Guidance and Outlook - The company raised its revenue and adjusted EBITDA guidance for the full fiscal year 2025 [2] - Total revenue is expected to be between $1.030 billion and $1.042 billion, with adjusted EBITDA projected between $418 million and $426 million [6][20] Client Metrics - Waystar serves approximately 30,000 clients, including 1,268 clients contributing over $100,000 in last twelve months (LTM) revenue, which is a 14% increase year-over-year [6][19] - The net revenue retention rate (NRR) stands at 115% [6] Strategic Developments - The company announced an agreement to acquire Iodine Software, which is expected to expand its total addressable market and enhance its financial profile [2]

Group 1 - Waystar Holding Corp. announced a definitive agreement to acquire 100% of Iodine Software [4] - The conference call featured remarks from CEO Matt Hawkins and CFO Steven Oreskovich [3] - The investor update included a presentation slide deck available on the company's Investor Relations website [4] Group 2 - The call was recorded and included instructions for participants [2] - The operator welcomed attendees and introduced the first speaker from Investor Relations [2] - The call will open to questions after the initial remarks from company executives [4]

Acquisition Overview - Waystar is set to acquire Iodine Software for a total enterprise value of $1.25 billion [7] - Iodine shareholders will own approximately 8% of Waystar on a fully diluted, pro forma basis [9] - Advent, Iodine's largest shareholder, is expected to receive 100% of its transaction consideration in Waystar common stock [9] Strategic Rationale - The acquisition aims to simplify healthcare payments and accelerate AI-powered transformation [5] - It expands Waystar's total addressable market by more than 15% [5] - The deal integrates clinical intelligence software to prevent denials and ensure optimal reimbursement [5] Financial Impact - Iodine's profile includes approximately 99% revenue derived from software subscriptions [26] - Iodine's gross margin is approximately 75% [26] - Iodine's Adjusted EBITDA margin is approximately 40% [26] Q2 2025 Preliminary Results - Waystar's approximate Q2 2025 revenue is $271 million [31] - Waystar's approximate year-over-year growth is 15% [32]

Exhibit 2.1 Strictly Confidential EXECUTION VERSION AGREEMENT AND PLAN OF MERGER BY AND AMONG WAYSTAR HOLDING CORP., MORTON MERGER SUB 1, INC., ISOTOPE HOLDING, LLC, ISOTOPE SOFTWARE PARENT, LLC, IODINE SOFTWARE HOLDINGS, INC. AND SHAREHOLDER REPRESENTATIVE SERVICES LLC, as Equityholder Representative Dated as of July 23, 2025 TABLE OF CONTENTS | | | Page | | --- | --- | --- | | | Article I DEFINITIONS | 2 | | 1.1 | Certain Definitions | 2 | | 1.2 | Terms Defined Elsewhere in this Agreement | 18 | | 1.3 | O ...

Core Insights - Waystar has announced a definitive agreement to acquire Iodine Software for a total enterprise value of $1.25 billion, aiming to enhance its healthcare payment solutions through advanced AI capabilities [1][2][4] - The acquisition is expected to be immediately accretive to Waystar's gross margin, adjusted EBITDA margin, revenue growth, and non-GAAP net income per diluted share by 2027 [2] - The combined entity is projected to expand Waystar's total addressable market by more than 15% and unlock new automation opportunities across the revenue cycle [7][14] Company Overview - Waystar is a provider of healthcare payment software, serving approximately 30,000 clients and over 1 million distinct providers, processing more than 6 billion healthcare payment transactions annually [13] - Iodine Software specializes in AI-powered clinical intelligence, helping to eliminate revenue leakage and lower administrative burdens for healthcare providers [15] Strategic and Financial Benefits - The acquisition is expected to streamline cumbersome tasks for providers and enhance the impact of Waystar's AI capabilities in clinical documentation integrity and revenue leakage identification [6][14] - Waystar anticipates realizing over $15 million in run-rate cost synergies within the first 18-24 months post-acquisition [14] Transaction Details - The transaction will be funded with a 50/50 mix of cash and stock, with current Waystar shareholders owning approximately 92% of the combined company post-transaction [8][9] - The deal is expected to close by year-end 2025, subject to customary closing conditions and regulatory approvals [9] Market Context - The healthcare industry faces approximately $440 billion in annual administrative costs, with up to 60 million claims denied each year due to administrative errors, highlighting the need for improved clinical documentation and coding [3][4] - The integration of Iodine's clinical intelligence software is expected to enhance Waystar's existing capabilities and deepen relationships with leading health systems, potentially serving 17 of the 20 U.S. News Best Hospitals [14]

Core Viewpoint - The market anticipates Waystar Holding (WAY) to report a year-over-year increase in earnings driven by higher revenues in its upcoming earnings report for the quarter ended June 2025, with actual results being crucial for stock price movement [1][2]. Earnings Expectations - Waystar is expected to post quarterly earnings of $0.33 per share, reflecting a significant year-over-year increase of +725% [3]. - Revenues are projected to reach $254.09 million, marking an 8.3% increase from the same quarter last year [3]. Estimate Revisions - The consensus EPS estimate has remained unchanged over the last 30 days, indicating stability in analyst expectations [4]. - The Most Accurate Estimate for Waystar is higher than the Zacks Consensus Estimate, resulting in a positive Earnings ESP of +1.54%, suggesting a bullish outlook from analysts [11]. Earnings Surprise Prediction - The Zacks Earnings ESP model indicates that a positive Earnings ESP is a strong predictor of an earnings beat, especially when combined with a Zacks Rank of 1, 2, or 3 [9]. - Waystar currently holds a Zacks Rank of 3, which, along with the positive Earnings ESP, suggests a likelihood of beating the consensus EPS estimate [11]. Historical Performance - In the last reported quarter, Waystar met the expected earnings of $0.32 per share, resulting in no surprise [12]. - Over the past four quarters, Waystar has beaten consensus EPS estimates three times, indicating a generally favorable performance trend [13]. Conclusion - While Waystar is positioned as a compelling earnings-beat candidate, other factors may also influence stock performance post-earnings release [16].

Company Overview - Waystar Holding Corp. is a provider of healthcare payment software, aiming to simplify healthcare payments for providers to enhance patient care and financial performance [3] - The company serves approximately 30,000 clients, which includes over 1 million distinct providers, and 16 out of the 20 institutions listed in U.S. News Best Hospitals [3] - Waystar's platform processes over 6 billion healthcare payment transactions annually, managing over $1.8 trillion in gross claims and covering about 50% of U.S. patients [3] Financial Reporting - Waystar will report its financial results for the second quarter ended June 30, 2025, after market close on July 30, 2025 [1] - A conference call to discuss these financial results will take place at 4:30 p.m. Eastern Time on the same day [1] Investor Relations - A live audio webcast of the conference call will be available on Waystar's investor relations website, with an archive for those unable to listen in real time [2]

Core Insights - AI is becoming essential in revenue cycle management (RCM) for healthcare providers, demonstrating significant impact and return on investment [1][2][3] Group 1: AI Integration in Healthcare - 82% of healthcare leaders consider AI integral to their RCM operations, with 70% identifying it as a top organizational priority [2][6] - AI is delivering 13-37% improvements in key revenue cycle areas such as claim accuracy, denial prevention, workforce efficiency, and payment speed [6] - Trust in AI is increasing, with 60% of decision-makers reporting heightened confidence since implementation [6] Group 2: Strategic Implementation and Adoption - Providers are prioritizing strategic AI implementation, particularly in payer-facing workflows like prior authorizations and denial appeals [3] - The majority of healthcare leaders are relying on existing RCM software partners for AI capabilities, favoring established platforms for faster value realization and data security [6] - Nearly 60% of healthcare leaders plan to increase AI investment, highlighting its strategic role in enhancing payment performance and process transformation [6] Group 3: Industry Impact - The study indicates a broader shift in the healthcare industry as AI accelerates automation, enhances analytics, and drives stronger returns on investment [3] - Waystar's platform processes over 6 billion healthcare payment transactions annually, reflecting the scale at which AI is being integrated into RCM [5]

Company Overview - Waystar Holding Corp. is a provider of healthcare payment software, focused on simplifying healthcare payments to enhance patient care and financial performance [4] - The company serves approximately 30,000 clients, representing over 1 million distinct providers, including 16 of the top 20 institutions on the U.S. News Best Hospitals list [4] - Waystar's platform processes over 6 billion healthcare payment transactions annually, amounting to over $1.8 trillion in gross claims, covering approximately 50% of U.S. patients [4] Leadership Changes - Waystar has appointed Aashima Gupta and Michael Roman to its Board of Directors, bringing significant expertise in AI innovation, healthcare, and enterprise growth [1][2] - Aashima Gupta, previously Global Director of Healthcare Strategy and Solutions at Google Cloud, has led initiatives in healthcare AI to improve access and efficiency [2] - Michael Roman, former CEO and Executive Chairman of 3M, has nearly 40 years of experience in strategic leadership and operational excellence, with 3M generating approximately $32 billion in annual revenue, a quarter of which is from healthcare [3] Strategic Goals - The new board members are expected to provide strategic guidance to advance Waystar's mission of simplifying healthcare payments and delivering long-term value to clients, shareholders, and team members [2] - The company aims to leverage the expertise of its new directors to enhance innovation and growth within the healthcare payment sector [2]

Summary of Waystar Holding (WAY) FY Conference Call Company Overview - **Company**: Waystar Holding (WAY) - **Industry**: Healthcare technology and software solutions - **Founded**: 2017, backed by Bain Capital - **Public Listing**: Went public approximately one year prior to the conference call Key Highlights - **Financial Performance**: - Achieved four consecutive quarters of double-digit revenue growth [8] - Adjusted EBITDA margins consistently at or above 40% [8] - Reported a year-over-year revenue growth of 14% in Q1 [49] - Adjusted Q1 EBITDA margins reported at 42% [49] - **Business Model**: - Focused on providing cloud-based software solutions for healthcare providers to streamline payment processes [10][12] - Operates in a large addressable market with an estimated annual opportunity of $15 billion [43] - Holds approximately 5% market share in hospitals and 8-9% in ambulatory sites [43] - **Client Relationships**: - Gross revenue retention rate of 97% [14][15] - Net revenue retention rate of 114% in Q1 [15] - Works with over a million providers, reaching approximately 50% of the U.S. patient population annually [22] - **Technological Advancements**: - Pioneering the use of AI and machine learning in healthcare software [14] - Launched "Altitude AI," a suite of generative AI capabilities to enhance claims processing efficiency [33][34] - Achieved an average first-pass claim acceptance rate of nearly 99% [35] Industry Context - **Challenges in Healthcare**: - The industry faces nearly $500 billion in administrative waste, with over $4 trillion spent annually on healthcare in the U.S. [26] - Staffing shortages, denial complexities, and cybersecurity concerns are prevalent issues [27] - **Market Dynamics**: - The healthcare sector is experiencing significant consolidation, with hospitals acquiring other facilities and physician networks [11] - Legacy software vendors are struggling to transition to modern cloud-based solutions, presenting an opportunity for Waystar [12] Growth Strategies - **Client Expansion**: - Plans to deepen relationships with existing clients through cross-selling and upselling additional software modules [47] - Actively pursuing new client acquisitions and expanding channel partner relationships [48] - **Acquisitions**: - Completed nine acquisitions to integrate new companies onto the Waystar platform [49] Additional Insights - **Cultural Commitment**: - Emphasizes a strong organizational culture focused on customer service and mission-driven work [4][18] - The team is passionate about simplifying healthcare payments and improving provider experiences [18] - **Integration Capabilities**: - Integrates with over 500 electronic health record and practice management systems, with more than 200 active channel partners [13][44] - **Impact on Providers**: - The software aims to reduce the complexity of billing and collections, leading to quicker payments and improved revenue visibility for providers [38][39] This summary encapsulates the key points discussed during the Waystar Holding FY Conference Call, highlighting the company's performance, market position, technological innovations, and growth strategies within the healthcare technology industry.