Phreesia(US:PHR)2025-12-08 23:00Financial Data and Key Metrics Changes - Total revenue for Q3 Fiscal 2026 was $120.3 million, representing a 13% year-over-year increase [11] - Adjusted EBITDA reached $29.1 million, an increase of $19 million year-over-year and $7 million quarter-over-quarter, with an all-time high adjusted EBITDA margin of 24% [11] - Net income was $4.3 million, marking the second consecutive quarter of positive net income [12] - Cash and cash equivalents at the end of the quarter were $106.4 million, up from $98.3 million in the prior quarter [14] - Operating cash flow was $15.5 million, up $9.7 million year-over-year, and free cash flow was $8.8 million, up $7.2 million year-over-year [14] Business Line Data and Key Metrics Changes - Average healthcare services clients (AHSCs) increased to 4,520, up by 53 from the prior quarter [11] - Total revenue per AHSC was $26,622, a 6% increase year-over-year [12] Market Data and Key Metrics Changes - The company expects to add approximately 80 AHSCs annually through the AccessOne acquisition, which manages a portfolio of approximately $450 million [16] - The blended take rate for AccessOne's managed portfolio averages 4%-12% depending on the provider type and program mix [16] Company Strategy and Development Direction - The company is focusing on provider financing and healthcare provider marketing as new growth areas [6][8] - The acquisition of AccessOne is seen as a significant growth lever to enhance cash flow for healthcare providers [8] - The company aims to leverage its existing relationships and infrastructure to engage healthcare providers and life sciences partners effectively [9] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in sustaining growth and enhancing stakeholder value through emerging products [5] - The updated revenue outlook for fiscal 2026 is projected to be between $479 million and $481 million, reflecting a contribution from AccessOne [17] - For fiscal 2027, the company anticipates revenue in the range of $545 million to $559 million, with adjusted EBITDA expected to be between $125 million and $135 million [19] Other Important Information - The company has achieved positive operating cash flow and free cash flow for five consecutive quarters [14] - The AccessOne acquisition was funded with approximately $53 million in cash and a $110 million secured bridge loan [15] Q&A Session Summary Question: Growth potential for AccessOne - Management indicated that AccessOne's product needs investment before it can be offered to the majority of existing clients, with plans to invest in go-to-market strategies [22][23] Question: Financing and market conditions - Management is actively looking to refinance the bridge loan and is optimistic about market demand for financing solutions [26][27] Question: Core growth expectations for fiscal 2027 - Management expects network solutions to grow the fastest, followed by payment processing and subscription services [31][32] Question: HCP marketing initiative - The company has started selling the HCP marketing offering to select clients and anticipates it will generate incremental revenue [39][40] Question: Updated fiscal 2026 guidance - Management clarified that the updated guidance reflects a more measured approach to network solutions due to market fluidity [42][45] Question: AccessOne's funded and unfunded models - Management highlighted AccessOne's flexibility in offering various funding models to meet client needs and expects to learn which offerings resonate best over time [47][49]