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]

Financial Data and Key Metrics Changes - In Q1 2025, GAAP net income was $5.2 million or $0.25 per diluted share, up from $4.2 million or $0.21 per diluted share in Q1 2024 [22] - Total GAAP revenue for Q1 2025 was $36.3 million, an increase of over 7% from $33.9 million in the prior quarter and nearly 4% from $34.9 million in Q1 2024 [23] - Adjusted EBITDA totaled $8.2 million, reflecting a nearly 9% increase from the same quarter in 2024 [28] Business Line Data and Key Metrics Changes - Software revenue reached $17.8 million, up 9.2% from the prior year quarter, while wireless revenue was $18.5 million, nearly flat compared to Q1 2024 [23] - Professional services revenue was $5.8 million, up nearly 44% from $4 million in Q1 2024, with managed services revenue totaling $1.3 million, representing over 22% of total professional services revenue [26] - Software backlog increased by more than 15% year over year, indicating strong future revenue potential [42] Market Data and Key Metrics Changes - The company maintains the largest paging network in the United States, serving over 2,200 hospitals [12] - Wireless average revenue per unit (ARPU) increased by 4.4% year over year to $824, driven by pricing actions and sales of new products [23] Company Strategy and Development Direction - The company aims to generate cash and return capital to shareholders while investing in business growth, focusing on four strategic tenets: investment in wireless and software solutions, revenue growth, disciplined expense management, and stockholder-friendly capital allocation [10][9] - The company is committed to maintaining a strong position in healthcare communications, leveraging its established solutions and customer base to create shareholder value [10][12] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's performance and reiterated guidance for 2025, expecting total revenue to range from $134 million to $142 million [31] - The company believes that current macroeconomic uncertainties will not materially impact revenue or supply chain, maintaining a positive outlook for the healthcare industry [14] Other Important Information - The company plans to invest between $11 million and $12 million in product research and development in 2025 to fuel future software revenue growth [9] - The company has returned over $700 million to shareholders over the past 20 years through dividends and share repurchases [9] 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 [36][37] Question: What drove the strong wireless product revenue? - The increase was primarily due to a price increase for unreturned pagers, expected to yield an annualized benefit of about $1 million [38][39] Question: What drove the improvement in gross margin? - Gross margin improved due to strong revenue performance, but fluctuations are expected based on revenue dynamics [40][41] Question: What is the conversion timeline for the software backlog? - Approximately half of the backlog is services, which typically convert over a 9 to 15-month period [42][43] Question: What 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][49] Question: What is the strategy for professional services? - The focus is on managed services, providing fixed costs for customers and improving revenue recognition [51][52] Question: Are the two new logos significant customers? - Both new customers are meaningful wins that the company has pursued for some time [58][60]