Financial Data and Key Metrics Changes - In Q3 2025, GAAP net income was $3.2 million or $0.15 per diluted share, down from $3.7 million or $0.18 per diluted share in Q3 2024 [17] - Total GAAP revenue in Q3 2025 was $33.9 million, a decrease from $34.9 million in the prior year [17] - Adjusted EBITDA for Q3 2025 totaled $6.6 million, compared to $7.5 million in the prior year [21] Business Line Data and Key Metrics Changes - Wireless revenue in Q3 2025 was $17.8 million, down from $18.3 million in Q3 2024, while software revenue was $16.1 million, slightly down from $16.6 million [17] - Professional services revenue increased to $5.5 million in Q3 2025, up nearly 13% year-over-year [20] - Managed services revenue experienced triple-digit growth year-over-year, contributing to the overall performance in professional services [20] Market Data and Key Metrics Changes - The company reported a 20 basis point sequential improvement in quarterly net unit churn, which decreased to 1.4% from 1.6% in the prior quarter [18] - Wireless average revenue per unit (RPU) increased by $0.24 or 3% from the prior year, driven by pricing actions and sales of the Gen A pager [18] Company Strategy and Development Direction - The company aims to generate cash and return capital to stockholders while investing in and growing its business [5] - The strategic focus includes continued investment in wireless and software solutions, disciplined expense management, and a stockholder-friendly capital allocation plan [9] - The company maintains a strong product platform, including Spok Console, Spok Messenger, and Spok Mobile, which are expected to drive future growth [14][16] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's performance despite seasonal headwinds and reaffirmed guidance for the year [3][22] - The company anticipates a strong fourth quarter, supported by a robust sales pipeline and large deals in progress [28][29] - Management highlighted the importance of recurring revenue from wireless services and the integration of paging with software operations [23] Other Important Information - The company has returned over $720 million to stockholders over the last 20 years, with nearly $100 million returned since the strategic pivot in early 2022 [8] - The company ended Q3 2025 with $21.4 million in cash and cash equivalents, with expectations for continued growth in cash balances [21] Q&A Session Summary Question: What drove the 55% year-over-year decline in license revenue? - Management indicated that license revenue is lumpy and directly related to sales, with variability expected from quarter to quarter [26][27] Question: What led to the weaker third quarter and how should the fourth quarter be viewed? - Management noted that while Q3 bookings were impacted, they remain bullish on the fourth quarter due to a strong pipeline and large deals [28][29] Question: Anticipated increase in R&D for 2026? - Management confirmed R&D investment will increase to over $13 million in 2026, focusing on enhancing the Spok Care Connect suite [30]

Financial Data and Key Metrics Changes - In Q1 2025, total GAAP revenue was $36.3 million, up more than 7% from $33.9 million in the prior quarter and nearly 4% from $34.9 million in Q1 2024 [24] - GAAP net income totaled $5.2 million or $0.25 per diluted share, an increase from $4.2 million or $0.21 per diluted share in 2024 [23] - Adjusted EBITDA reached $8.2 million, reflecting a nearly 9% increase from the same quarter in 2024 [29] Business Line Data and Key Metrics Changes - Software revenue was $17.8 million, up 9.2% from the prior year quarter, while wireless revenue was $18.5 million, nearly flat compared to Q1 2024 [24] - Professional services revenue increased by nearly 44% year over year, totaling $5.8 million, with managed services revenue accounting for $1.3 million, up more than 180% from $500,000 in Q1 2024 [27] - Software backlog increased by more than 15% year over year, indicating strong future revenue potential [9] Market Data and Key Metrics Changes - The average revenue per unit (ARPU) for wireless services increased by 4.4% year over year to $824, driven by prior pricing actions and sales of new products [24] - Net unit churn improved to 6.4% from 7.2% in the prior year, reflecting better customer retention [24] Company Strategy and Development Direction - The company aims to generate cash and return capital to shareholders while investing in growth, maintaining a disciplined expense management approach [5][12] - The strategic focus includes continued investment in wireless and software solutions, growing the revenue base, and a stockholder-friendly capital allocation plan [12] - The company has transformed into a leading healthcare communications provider, emphasizing its commitment to enhancing patient care and safety through technology [13][15] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's performance despite macroeconomic uncertainties, reiterating guidance for 2025 [16][31] - The company anticipates annual free cash flow in the range of $24 to $28 million and expects to exit 2025 with cash balances between $23 million and $27 million [30] - Management highlighted a strong start to 2025, with expectations for continued growth driven by software solutions and a solid customer base [33] Other Important Information - The company has maintained a strong reputation in the healthcare communications industry, recognized as a top clinical communications platform for eight of the past ten years [15] - The HIMSS conference experience was positive, with a focus on prequalifying meetings leading to better engagement and interest in new products [48][50] Q&A Session Summary Question: Is there any seasonality with the larger 7 figure contracts? - Management noted no seasonality observed, with a positive trend in contract signings [38] Question: What drove the strong wireless product revenue? - The increase was primarily due to a pricing initiative for unreturned pagers, expected to yield an annualized benefit of about $1 million [40] Question: What drove the improvement in gross margin? - Gross margin improved due to strong revenue performance, though fluctuations may occur based on quarterly results [41][42] Question: What is the conversion timeline for the software backlog? - Approximately half of the backlog is services, with maintenance revenue typically recognized over a year and services over nine to fifteen months [43][44] Question: How was the experience at the HIMSS conference? - The conference was better than the previous year, with a focused approach leading to successful customer engagements [48][50] Question: What is the strategy for managed services? - Managed services provide fixed costs for customers, aiding in revenue recognition and reducing churn [52][53] Question: Are the new logos significant customers? - Both new logos are meaningful wins, with the company having pursued them for some time [56][59]