Financial Data and Key Metrics Changes - Revenue for Q3 2025 reached $269 million, reflecting a 12% year-over-year growth, with an adjusted EBITDA margin of 42% [7][20][22] - Adjusted EBITDA increased by 17% year-over-year to $113 million, with the adjusted EBITDA margin exceeding the long-term target of approximately 40% [22][23] - Net revenue retention rate (NRR) was 113%, indicating strong client retention and expansion [21][17] Business Line Data and Key Metrics Changes - Subscription revenue grew to $134 million, a 14% increase year-over-year, while volume-based revenue was $132 million, up 10% year-over-year [22] - The client base generating over $100,000 in trailing 12-month revenue increased by 11% year-over-year to 1,306 clients [17][21] Market Data and Key Metrics Changes - The acquisition of Iodine Software is expected to expand the total addressable market by over 15% and enhance innovation capabilities [9][10] - The healthcare financial system is described as complex and fragmented, with a significant opportunity for modernization through Waystar's platform [8][15] Company Strategy and Development Direction - Waystar aims to simplify healthcare payments through a cloud-based platform that integrates clinical, administrative, and financial data [8][10] - The company is focused on leveraging AI to enhance operational efficiencies and client satisfaction, positioning itself as a leader in the healthcare revenue cycle management space [9][15][68] Management's Comments on Operating Environment and Future Outlook - Management highlighted the importance of addressing rising denial rates and workforce shortages in the healthcare sector, which are pressuring margins [12][60] - The company is optimistic about capturing growth opportunities through the integration of Iodine's capabilities and the ongoing demand for AI-driven solutions [9][10][68] Other Important Information - Waystar received recognition as one of the best workplaces for innovators and was named Healthcare Company of the Year by the Stevie Awards [18] - The company is committed to maintaining high cash flow conversion rates, with unleveraged free cash flow of $96 million in Q3 2025 [24][25] Q&A Session Summary Question: Feedback from Iodine clients during the True North conference - Management reported 100% positive feedback from clients regarding the Iodine acquisition, highlighting the strategic fit and potential benefits for healthcare [31][32] Question: Cadence of replacing legacy processes in RCM - Management noted that Iodine's capabilities will facilitate faster transitions from legacy systems, enhancing the overall efficiency of revenue cycle management [35][36] Question: Patient utilization trends and seasonality - Management indicated that patient utilization is returning to historical levels, with expectations for continued growth in the volume-based revenue segment [41][42] Question: Transition from mail payments to mobile - Management discussed the ongoing shift towards digital payment solutions, emphasizing the long-term transformation in patient financial engagement [46][49] Question: Acceleration of product roadmap due to Iodine acquisition - Management provided examples of how Iodine's clinical data will enhance existing products, potentially accelerating the product development timeline by nearly two years [52][56] Question: Competitive landscape and go-to-market strategy - Management acknowledged increased competition but emphasized Waystar's comprehensive platform approach and strong client relationships as key differentiators [66][68] Question: Sustainability of EBITDA margin efficiencies - Management expressed confidence in maintaining margin efficiencies through ongoing operational improvements and AI-driven solutions [82]

Financial Data and Key Metrics Changes - Revenue for Q3 2025 reached $269 million, reflecting a 12% year-over-year growth, with an adjusted EBITDA margin of 42% [6][19] - Adjusted EBITDA for the quarter was $113 million, representing a 17% increase year-over-year [20] - Net Revenue Retention Rate (NRR) was 113%, indicating strong client retention and expansion [19][16] Business Line Data and Key Metrics Changes - Subscription revenue increased by 14% year-over-year to $134 million, while volume-based revenue grew by 10% year-over-year to $132 million [20] - The number of clients generating over $100,000 in trailing 12-month revenue grew to 1,306, an 11% increase year-over-year [16] Market Data and Key Metrics Changes - The acquisition of Iodine Software is expected to expand the total addressable market by over 15% and accelerate innovation [9][10] - The healthcare financial system is experiencing rising utilization and denial rates, which are pressuring margins for providers [12][60] Company Strategy and Development Direction - The company aims to simplify healthcare payments through a cloud-based platform that integrates clinical, administrative, and financial data [7][10] - Waystar is focused on leveraging AI to enhance operational efficiency and client satisfaction, positioning itself as a leader in the healthcare payment modernization space [8][14] Management's Comments on Operating Environment and Future Outlook - Management highlighted the importance of addressing data fragmentation and integration challenges in the healthcare sector [13][14] - The company is optimistic about capturing growth opportunities as the demand for efficiency and transparency in healthcare increases [9][60] Other Important Information - Waystar received recognition as one of the best workplaces for innovators and was named Healthcare Company of the Year by the Stevie Awards [17] - The company is committed to maintaining a strong cash flow, ending the quarter with $421 million in cash and equivalents [23] Q&A Session Summary Question: Feedback on Iodine Software and client introduction - Management reported overwhelmingly positive feedback from clients regarding the Iodine acquisition and its integration with Waystar's offerings [28][31] Question: Cadence of replacing legacy processes in RCM - Management indicated that the integration of Iodine's capabilities will facilitate faster transitions from legacy systems to modern solutions [33][36] Question: Patient utilization trends and seasonality - Management noted that patient utilization is returning to historical levels, with expectations for continued growth in the volume-based revenue segment [39][41] Question: Shift from mail payments to mobile - Management discussed ongoing efforts to digitize patient payments, emphasizing the long-term transformation required in this area [44][46] Question: Acceleration of product roadmap due to Iodine - Management provided examples of how Iodine's capabilities will enhance Waystar's product offerings and accelerate development timelines [51][54] Question: Margin sustainability and internal efficiencies - Management expressed confidence in maintaining adjusted EBITDA margins around 40% while investing in innovation and operational efficiencies [80]

Core Insights - Waystar is addressing significant financial challenges in the healthcare sector, including $20 billion in denied claims and $17 billion in uncompensated care, by introducing AI-powered software innovations aimed at improving financial performance and resilience for healthcare providers [1][2]. Group 1: Financial Challenges - Healthcare providers are facing $20 billion annually in costs related to denied claims and $17 billion in uncompensated care due to lower patient collections [2]. - Eliminating manual steps in obtaining payer reimbursement could save the industry $2.6 billion [2]. Group 2: Waystar's Innovations - Waystar is launching the first scaled, AI-powered, end-to-end solution for denial appeals, significantly reducing the time required to create appeal packages from 38 hours to just 2 hours, which allows for a redeployment of resources [4]. - The new AI capabilities have enabled early adopters to overturn 40% more denials and improve pre-service patient payments from 17% to 40% of total payments, enhancing cash flow and reducing uncompensated care [5][4]. Group 3: Efficiency Gains - Waystar's platform delivers over 90% time savings across key capabilities, allowing healthcare providers to reclaim millions in revenue and free up resources equivalent to more than a dozen full-time employees [2]. - The AI technology reduces denial-prevention-related work from 133 hours to under 6 hours, achieving a 95% time savings [6]. Group 4: Market Position - Waystar serves approximately 30,000 clients, representing over 1 million distinct providers, and processes over 6 billion healthcare payment transactions annually, including over $1.8 trillion in gross claims [8].

Core Insights - Waystar Holding Corp. reported strong financial performance in Q1 2025, with net income margins exceeding 10% and adjusted EBITDA margins exceeding 40% [2][5] - The company launched Waystar AltitudeAI, enhancing its product offerings with AI capabilities to improve client workflows and financial performance [2] - Waystar raised its full-year revenue and adjusted EBITDA guidance for 2025, reflecting confidence in its growth model [2] Financial Highlights - Q1 2025 revenue reached $256.4 million, a 14% increase year-over-year [6][23] - Net income for Q1 2025 was $29.3 million, with a net income margin of 11% [5][24] - Adjusted EBITDA for Q1 2025 was $107.7 million, with an adjusted EBITDA margin of 42% [6][29] - The company expects total revenue for 2025 to be between $1.006 billion and $1.022 billion, and adjusted EBITDA to be between $406 million and $414 million [6] Client Metrics - Waystar serves approximately 30,000 clients, processing over 6 billion healthcare payment transactions annually [21] - The net revenue retention rate (NRR) was reported at 114% for the trailing twelve months ending March 31, 2025 [6] - The number of clients contributing over $100,000 in revenue increased by 15% year-over-year [6] Cash Flow and Debt - Cash flow from operations for Q1 2025 was $64 million, with unlevered free cash flow of $79 million [6][34] - Net debt as of March 31, 2025, was reported at $992.2 million, with an adjusted net leverage ratio of 2.5x [35]