Financial Data and Key Metrics Changes - Consensus reported a record revenue of $87.1 million for Q4 2025, marking a slight increase of 0.1% year-over-year, and a full year revenue of $349.7 million, which is essentially flat compared to the previous year [27][28] - Adjusted EBITDA for Q4 2025 was $45.2 million, up from $44.4 million in Q4 2024, resulting in a solid EBITDA margin of 51.9% [27] - Free cash flow reached a record $106 million for the year, an increase of 20% from 2024, with a capital expenditure of $30 million, down 10% year-over-year [30] Business Line Data and Key Metrics Changes - Corporate channel revenue for Q4 2025 was $56.8 million, a 7.3% increase year-over-year, and for the full year, it reached $222.7 million, up 6.5% [13][24] - SOHO channel revenue for Q4 2025 was $30.3 million, a decrease of 11.1% year-over-year, with a full year revenue of $127 million, down 10% compared to 2024 [19][26] Market Data and Key Metrics Changes - The corporate revenue retention rate stood at 101.3%, an improvement from 100.5% in the previous year, with the corporate customer base increasing by 11.3% year-over-year to approximately 65,000 [17][24] - The average revenue per account (ARPA) for the corporate channel was approximately $290, a decrease of $13 year-over-year, while the SOHO ARPA was $15.55, remaining flat year-over-year [24][26] Company Strategy and Development Direction - The company is focused on transitioning its business model towards a recurring revenue platform, with a significant shift towards corporate revenue, which is projected to reach 68% of total revenue by 2026 [12] - The strategy includes enhancing healthcare solutions and expanding into the public sector, particularly with the eFax product tailored for government use [16][17] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the demand environment, noting that hospitals are adapting to budget constraints and showing increased engagement with the company's services [40] - The company anticipates continued growth in corporate revenue, projecting a 9% growth rate at the midpoint of guidance for 2026, while SOHO revenue is expected to decline by approximately 10% [9][10] Other Important Information - The CFO, Jim Malone, will retire, with Adam Varon set to succeed him, indicating a smooth transition in leadership [34][35] - The company plans to be more aggressive in its share repurchase program, given the favorable free cash flow yield compared to debt costs [10] Q&A Session Summary Question: Can you talk about the demand environment and the success of the VA? - Management noted that hospitals are adjusting to budget changes and are increasingly interested in operational services, with the VA projected to contribute over $9 million in revenue for 2026, exceeding previous expectations [40][41] Question: What are the underlying demand dynamics for Clarity and competition? - The company highlighted that demand for Clarity is driven by the need to reduce administrative burdens and accelerate processing times, with a focus on specific use cases like referral management [62] Question: Can you discuss expectations for ARPA this year? - Management indicated that ARPA may experience downward pressure due to the growth of eFax Protect, but the non-eFax Protect cohort is expected to see growth [78] Question: Can you provide details on gross margin expectations? - The company expects stable gross margins around 80%, with most cost increases occurring in operating expenses rather than cost of goods sold [85]