Marpai (MRAI) Q2 2025 Earnings Call August 14, 2025 08:30 AM ET Speaker0Good morning, and welcome to the Marpay Second Quarter twenty twenty five Earnings Webcast. All participants will be in listen only mode. After today's presentation, there will be an opportunity to ask questions. Please note this event is being recorded. I would now like to turn the conference over to Steve Johnson, Chief Financial Officer.Please go ahead.Speaker1Thank you, and welcome this morning to our Marpay Second Quarter Earnings ...

Financial Data and Key Metrics Changes - Net revenues for Q1 2025 were $5.4 million, approximately 27% lower than Q1 2024 [3] - Operating expenses were $7.7 million, showing a 33% improvement over Q1 2024 [4] - Operating loss was $2.3 million, a 45% improvement over Q1 2024 [4] - Net loss was $3.1 million, representing a 29% improvement over Q1 2024 [4] - Basic and diluted earnings per share were a loss of $0.21, an improvement of $0.25 per share over Q1 2024 [4] Business Line Data and Key Metrics Changes - The company is focusing on margin-generating clients and managing lower-margin clients to drop off [3][4] - The TPA market in the U.S. is valued at $150 billion, with a forecasted annual growth of 12.1% through 2031 [8] Market Data and Key Metrics Changes - The company is positioned to partner with employers adopting self-funded health insurance, which is a growing trend due to rising healthcare inflation [5][6] - Employers can see savings of up to 10% by moving to a self-funded model managed by a TPA [6] Company Strategy and Development Direction - The core mission is to deliver affordable and intelligent healthcare solutions, with a strong pipeline of business for the second half of 2025 [10] - The company is focused on driving efficiencies and cost reductions to achieve profitability [11] - The appointment of Dallas Scripp as COO is part of the strategy to strengthen leadership and drive growth initiatives [11] Management's Comments on Operating Environment and Future Outlook - Management acknowledges the challenges faced in signing new business in Q1 but expects to win clients off-cycle and during the January cycle next year [14][18] - Confidence in achieving cash flow positivity by year-end is supported by ongoing cost reduction initiatives and operational efficiencies [20][21] Other Important Information - The rollout of the Empower member portal is on track to be completed by the end of Q2 2025, which aims to improve customer service and operational efficiency [10][24] Q&A Session Summary Question: Insights on new business sign-ups in Q1 - Management focused on turnaround efforts in 2024 and did not hire key sales personnel until May, impacting new business sign-ups [15][16] Question: Expectations for off-cycle client wins - Management confirmed expectations for off-cycle wins and a strong pipeline for the second half of 2025 [17][18] Question: Discussion on cash burn and cost reduction initiatives - Management highlighted ongoing rationalization of vendors and legacy contracts to reduce costs and improve operational efficiencies [20][21] Question: Details on the Empower portal - The Empower portal consolidates multiple applications into a single solution, enhancing user experience and reducing call center demands [22][24]