Financial Data and Key Metrics Changes - For Q4 fiscal year 2026, revenue was $127.1 million, up 16% year-over-year, with growth led by Payment Solutions following the acquisition of AccessOne [14] - Adjusted EBITDA was $29.4 million, compared to $16.4 million in the same period last year, representing an adjusted EBITDA margin of 23% [14] - Free cash flow was $28.5 million, up $19.3 million year-over-year, marking the strongest quarterly free cash flow to date [16] - The company achieved positive GAAP net income for the first time in its history as a publicly traded company [8] Business Line Data and Key Metrics Changes - Average Healthcare Services clients (AHSCs) reached 4,658, an increase of 138 from the prior quarter, with 80 of these contributed through the AccessOne acquisition [14] - Total revenue per AHSC was $27,279, up 8% year-over-year [14] Market Data and Key Metrics Changes - The healthcare industry is facing challenges including FDA guidelines, insurance coverage, patient utilization, and provider reimbursement [10] - There is variability in financial forecasts due to shorter visibility into spending commitments from certain pharmaceutical manufacturers in the Network Solutions business [11] Company Strategy and Development Direction - The company is focusing on growth initiatives such as provider financing and HCP marketing, with the acquisition of AccessOne being central to its strategy [9] - The launch of ProviderConnect is aimed at enhancing healthcare provider marketing, leveraging the existing PatientConnect platform [9] - The company is committed to building products that address access, affordability, and outcomes, with a focus on financial services and patient engagement [11] Management's Comments on Operating Environment and Future Outlook - Management acknowledges a tough market environment but believes the company is well-positioned to grow on its own terms [10] - The company is lowering its revenue outlook for fiscal year 2027 to a range of $510 million-$520 million, down from a prior range of $545 million-$559 million, due to reduced visibility into spending commitments [18] - Adjusted EBITDA outlook for fiscal year 2027 remains unchanged at $125 million-$135 million, reflecting operational leverage and efficiency gains [19] Other Important Information - The company completed a refinancing of its bridge loan, replacing it with a new senior secured revolving credit facility [17] - Cash and cash equivalents as of January 31, 2026, were $73.8 million, down from $84.2 million a year earlier [16] Q&A Session Summary Question: Dynamics in the Network Solutions end market and guidance change - Management indicated that the lack of visibility is not broad-based but specific to certain brands and therapeutic areas, such as vaccines and public health [24][25] Question: ProviderConnect's contribution to HCP marketing - Management stated that ProviderConnect is still in early stages and its impact on revenue outlook is minimal at this time [30] Question: Impact of price negotiations on pharma clients' budgeting - Management clarified that current issues are more related to specific therapeutic areas and regulatory activities rather than price negotiations [33] Question: Cost actions impacting EBITDA guidance - Management emphasized ongoing capital investment and efficiency improvements as key factors supporting the unchanged EBITDA outlook [36] Question: AI's role in competitive landscape - Management believes AI will enhance the breadth of offerings and improve operational efficiencies, positioning the company favorably in the market [55] Question: Visibility into Network Solutions revenue - Management noted that the recent updates pertain primarily to PatientConnect, with positive developments in ProviderConnect [65] Question: GLP-1 drugs impact on Network Solutions - Management categorized GLP-1 drugs as part of the challenges affecting revenue forecasts, similar to vaccines and public health issues [62] Question: Strategy for scaling AccessOne - Management indicated that growth will involve both expanding within existing competencies and exploring new opportunities in the healthcare provider ecosystem [72]

Financial Data and Key Metrics Changes - For Q4 2025, the company generated revenue of $300,000 from access fees related to future astronauts, with total operating expenses reduced by 26% to $61 million compared to $82 million in the prior year [35] - The net loss improved by 18% to $63 million in Q4 2025 compared to $76 million in the prior year, while adjusted EBITDA improved by 23% to -$49 million [35] - For the full fiscal year 2025, the company reported a net loss of $279 million, representing a 20% improvement compared to a net loss of $347 million in the prior year [36] Business Line Data and Key Metrics Changes - The company has completed structural assembly of all three major components of its spaceship, with ground testing expected to begin in April 2026 and the first space flight on track for Q4 2026 [4][5] - Sales for Virgin Galactic space flight expeditions have begun, with a limited tranche of 50 expeditions priced at $750,000 each [11][12] Market Data and Key Metrics Changes - The company expects to begin commercial space flight operations with a cadence of approximately 4 flights per month, ramping up to 10+ flights per month by Q2 2027 [14][15] - The company has over 650 founding astronauts in its community, with plans to increase ticket prices after the initial tranche of sales [12][70] Company Strategy and Development Direction - The company is focused on expanding its suborbital business model and developing new spaceports, with a new Chief Growth Officer appointed to drive growth and scale [13][50] - The company plans to leverage joint venture agreements for new spaceports, with each partnership tailored to the specific needs of the host country [51][52] Management's Comments on Operating Environment and Future Outlook - Management expressed excitement about the upcoming commercial operations and the potential for significant cash inflows as they initiate commercial service in Q4 2026 [39][43] - The company is optimistic about achieving modestly positive quarterly cash flow within 2027, with expectations for further improvements in free cash flow in subsequent years [28][39] Other Important Information - The company has successfully executed capital realignment transactions, extending the maturity of its debt and reducing future indebtedness [30][31] - The company ended 2025 with $338 million in cash equivalents and marketable securities, with capital expenditures for the year totaling $198 million [38] Q&A Session Summary Question: Thoughts on the Chief Growth Officer's role and future opportunities - The Chief Growth Officer will lead sales growth and expand the suborbital business model, including new spaceports and pricing strategies [50][51] Question: CapEx guidance and commercial spaceflight revenue expectations - CapEx for Q1 is projected to be around half of the total spending, with expectations for revenue to start from commercial service in Q4 [54][56] Question: Variables affecting flight cadence ramp-up - The company expects to reach 10 flights per month by having sufficient launch vehicle capacity and additional spaceships [59][60] Question: Timing and strategy for reopening ticket sales - The company plans to start with a limited number of tickets at $750,000, with future price increases as they build their book of business [70]

Financial Data and Key Metrics Changes - Revenue for Q1 2026 was $248 million, representing a 4% increase year-over-year [5][19] - Annual Recurring Revenue (ARR) grew by 2% in constant currency, reaching approximately $863 million [17] - Net Revenue Retention (NRR) remained strong at 99% [5][17] - Earnings per share (EPS) increased by 22% year-over-year to $1.60 [5][20] - Adjusted free cash flow was $99 million, up from $73 million in the prior year [21] Business Line Data and Key Metrics Changes - The growth in ARR was driven by contributions from various product lines, including OpenEdge, ShareFile, LoadMaster, WhatsUp Gold, MOVEit, and DevTools [17] - Operating income was $102 million, resulting in an operating margin of 41%, which reflects year-over-year margin expansion [20] Market Data and Key Metrics Changes - Deferred revenue at the end of Q1 was approximately $425 million, up roughly $25 million year-over-year [21] - Days Sales Outstanding (DSO) improved significantly to 52 days from 73 days in Q4 [21] Company Strategy and Development Direction - The company continues to focus on AI and innovation as key drivers for growth, emphasizing the importance of customer loyalty and operational efficiency [6][9] - Capital allocation priorities include investing in business innovation, reducing debt, and pursuing disciplined M&A opportunities [13][24] - The company opened a new innovation hub in Bangalore to enhance engineering and product development capabilities [15] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the business's performance, citing strong execution and resilience despite macroeconomic uncertainties [16][59] - The company is closely monitoring geopolitical events but has not observed any significant impact on its operations [59] Other Important Information - The company paid down $60 million in debt and repurchased $20 million of its stock during the quarter [12][22] - The balance sheet remains strong, with cash and cash equivalents of $113 million and total debt of $1.35 billion [20] Q&A Session Summary Question: On the M&A front, why is it taking longer to find the next acquisition? - Management noted that higher valuation metrics and the need to find the right assets are contributing factors to the delay [28][29] Question: Can you explain the isolated churn and its impact on SaaS revenue? - Management clarified that isolated churn was due to specific customer events unrelated to product dissatisfaction, and that the decline in SaaS revenue was expected to normalize [30][31][32] Question: What is the outlook for developer seat counts among customers? - Management indicated that while there is a trend of less growth in developer numbers, the overall count has not significantly dropped [36][39] Question: Is the SaaS revenue decline a concern? - Management reassured that the decline was related to data cleanup and billing system transitions, and they expect stability moving forward [45][48]

Financial Data and Key Metrics Changes - Fourth quarter 2025 revenue was $5 million, down 33% year-over-year and sequentially from the third quarter [6][10] - Full year 2025 revenue was $25.8 million, a decrease of 4.1% from fiscal year 2024 [6][12] - Consolidated gross profit for the fourth quarter was $1.1 million, resulting in a gross margin of 22.2%, compared to 26.4% in the prior year [10][11] - Operating loss for the fourth quarter was $1.3 million, compared to operating income of $34,000 in the fourth quarter of 2024 [11] - Net loss for the quarter was $1.3 million or $0.18 per diluted share, compared to net income of $132,000 or $0.02 per diluted share in the prior year [11] - Cash and cash equivalents at December 31, 2025, were $8.7 million, down from $12.6 million at December 31, 2024 [14] Business Line Data and Key Metrics Changes - Revenue in the CVD Equipment segment was concentrated among two key customers, representing approximately 53% of total fourth quarter revenue [10] - The SDC segment reported revenue of $2.2 million in the fourth quarter, compared to $1.9 million in the fourth quarter of fiscal 2024 [10] - Full year revenue for the SDC segment was $7.6 million, compared to $7.8 million in fiscal 2024 [12] Market Data and Key Metrics Changes - Orders in the fourth quarter totaled $3.5 million, primarily driven by demand in the SDC segment for gas delivery equipment [6] - Backlog at December 31, 2025, was $6.6 million, down from $19.4 million at the end of December 31, 2024 [7] - Factors pressuring bookings included softer demand in the CVD Equipment division, tariff-related uncertainties, and reduced U.S. government spending [8] Company Strategy and Development Direction - The company initiated a transformation strategy to reduce fixed operating costs and create a more agile organization [3][4] - Key elements of the strategy include transitioning to outsourced fabrication for certain components and revising the sales approach [4] - The company announced the sale of its SDC business to Atlas Copco Group for approximately $16.9 million, expected to close in Q2 2026 [4][5] Management's Comments on Operating Environment and Future Outlook - Management noted that the return to consistent profitability will depend on improved equipment order flow and disciplined cost management [14] - The company remains focused on delivering solutions across key markets, including aerospace and defense [8] - Management expressed cautious optimism about finding strategic opportunities to enhance shareholder value [20][26] Other Important Information - The company expects net cash proceeds from the SDC transaction to be approximately $15 million, which will be initially invested in U.S. Treasury securities [5][15] - The company retains ownership of its Saugerties facility, which will be leased to Atlas Copco Group for an initial term of two years [5] Q&A Session Summary Question: Can you describe the skill sets of your existing engineers and what type of acquisition you might be contemplating? - Management stated that the talent pool remains consistent and that the board is looking at strategic alternatives to increase shareholder value, but no material plans are currently in place [19][20] Question: What is the pipeline of opportunities you are looking at? - Management indicated that they have been exploring strategic alternatives for several quarters but do not have specific details to share at this time [21][24] Question: Are you considering a special dividend? - Management noted that a special dividend has not been paid in the company's history and that they focus on growing the business and utilizing funds conservatively [30] Question: Are you concentrating on military contracts due to current geopolitical situations? - Management confirmed that approximately 78% of revenue has come from military and defense sectors, and they expect this trend to continue [31][32]

Financial Data and Key Metrics Changes - Net income for Q4 2025 was $8.1 million, up from $7.5 million in Q4 2024, while full-year net income was $32.7 million compared to $40.2 million in 2024 [16][17] - Adjusted EBITDA for Q4 2025 was $36.9 million, an increase of approximately 4% from $35.4 million in Q4 2024; for the full year, adjusted EBITDA rose to $143.5 million from $139.2 million in 2024 [16][17] - Total fuel gallons sold contracted in 2025, but strong margins in wholesale and fleet fueling locations contributed positively to financial performance [17] Business Line Data and Key Metrics Changes - Wholesale fuel contribution increased by 8% to $24 million in Q4 2025, with gallons sold rising approximately 4% to 249 million gallons; full-year wholesale fuel contribution was $94.5 million, up from $90.4 million [17][18] - Fleet fueling segment generated $15.9 million in fuel contribution for Q4 2025, down from $16.3 million in the prior year, with gallons sold totaling 34.9 million [19] - GPMP segment's fuel contribution from related party locations was $10.2 million for Q4 2025, down from $12.3 million in Q4 2024, with gallons sold at 204 million [20] Market Data and Key Metrics Changes - The company distributed over 2 billion gallons in the last 12 months, holding approximately 1% market share in a highly fragmented fuel distribution market [6] - The macro environment has seen extraordinary volatility in fuel costs due to events in the Middle East, impacting pricing strategies and margins [8][9] Company Strategy and Development Direction - The company is focused on an asset-light and cash flow-generating business model, with plans for strategic acquisitions to expand its platform [5][6] - Two acquisition targets are currently under due diligence, one in the West South Central region and another in the Midwest, which could significantly increase annual gallons distributed [6][7] - The company aims to build 20 new cardlock locations in 2026, targeting mid-to-high teens returns on investments [12][13] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to manage margin stability despite rising fuel costs, primarily due to the cost-plus pricing model [9][10] - The company expects to deliver approximately $156 million in adjusted EBITDA and discretionary cash flow of approximately $110 million in 2026, with an assumption of adding 50 million gallons of volume through acquisitions [23][22] Other Important Information - The company declared a dividend of $0.26 per share, consistent with an annual dividend rate of $2 per share, representing an attractive yield [13] - Following the IPO, the company used $206.7 million of net proceeds to reduce debt, enhancing its capital structure and financial flexibility [21][22] Q&A Session Summary Question: Impact of rising fuel costs on business lines - Management noted that 85% of gallons sold are on a cost-plus basis, which mitigates the impact of volatility on margins; prompt pay discounts also enhance margins during price increases [29][31] Question: M&A activity in the current environment - Management indicated that while uncertainty exists, they have ongoing acquisition opportunities and believe high fuel prices may create pressure on small operators, presenting potential acquisition targets [35][36] Question: Margin enhancement details - The margin enhancement is linked to prompt pay discounts, which increase with rising fuel prices; management expects this to provide additional margin benefits [40][42] Question: CapEx outlook for fleet fueling and M&A - Management confirmed that the cost to build new fleet fueling locations remains around $1 million-$2 million per site, with 14 locations already identified for development [47][48]

Financial Data and Key Metrics Changes - For the full year 2025, the company generated $420 million in revenue, representing a 25% year-over-year growth, with total transactions increasing nearly 15% [3] - Gross profit for the full year increased 20.8% to $34.2 million compared to $28.3 million in 2024, while adjusted EBITDA improved by $1.7 million to a loss of $4 million [4][28] - Fourth quarter revenue totaled $90.6 million, a 1.2% decrease year-over-year, primarily driven by a 3.2% decrease in brokerage revenue [21] - For the full year 2025, GAAP net loss was $20.3 million or $0.72 per share, compared with a net loss of $21.6 million or $1.07 per share for 2024 [27] Business Line Data and Key Metrics Changes - The brokerage segment closed approximately 8,501 real estate transactions during the fourth quarter, a decrease of 14.2% compared to the prior year [29] - Revenue for the real estate division was approximately $84.9 million in the fourth quarter, representing a 3.2% decrease [31] - The mortgage business generated revenue of $3.4 million in the fourth quarter, representing an increase of approximately 70% [34] - The title business generated revenue of $1.8 million in the fourth quarter, representing an increase of approximately 38.5% [36] Market Data and Key Metrics Changes - In December, the industry saw a significant number of contract cancellations, with cancellation rates exceeding 20% in some markets [4] - U.S. home purchase agreements canceled in December represented approximately 16.3% of homes that went under contract, the highest December level recorded since tracking began in 2017 [29] Company Strategy and Development Direction - The company is focused on margin expansion, enhancing agent and customer experience, and leveraging AI-driven technology [5][41] - The introduction of new programs like Elevate and START aims to represent at least 10% of total transaction volume by year-end 2026 [6] - The company is restructuring its economics to reduce reliance on transaction volume and build a more durable profit model [5] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the long-term fundamentals for housing demand in the U.S., stating that the company is well-positioned regardless of market recovery [39] - The company believes that structural changes made to the business will deliver stronger results regardless of broader housing market conditions [38] - Management highlighted that the business is more scalable and profitable per transaction than ever before, positioning it to capture upside when the housing market recovers [43] Other Important Information - The company ended the quarter with a cash position of $5.7 million and entered into a $2 million financing arrangement for additional liquidity [37] - Leadership changes include the appointment of Lori Muller as the new President of Fathom Realty, bringing over 30 years of industry experience [20] Q&A Session Summary Question: What is the target for new Elevate partners in 2026? - The goal is to have about 1,000 agents on the Elevate platform by the end of the year, with current numbers around 260-275 [47] Question: What feedback has been received regarding the new Edge program? - The Edge program is expected to be a margin contributor from the start, with many agents expressing interest in moving to this new structure [51] Question: Any updates on the partnership with ByOwner? - The partnership aims to connect agents with sellers who initially want to sell their homes by themselves, with leads already being generated from this collaboration [56]

Financial Data and Key Metrics Changes - In Q4 2025, net revenue was $63 million, a decrease of 5% year-over-year, driven by an 11% decrease in total orders placed, partially offset by a 6% increase in average order value [35] - Gross margin for Q4 was 44.3%, up 640 basis points year-over-year, reflecting a higher mix of full-price sales and improved outbound shipping costs [36] - The net loss for Q4 improved to $0.4 million from a $31.9 million loss in the same period last year, with a full-year net loss of $13.7 million compared to $55.3 million in 2024 [39] - Adjusted EBITDA for Q4 was positive $2.6 million compared to a $3.3 million loss in Q4 2024, marking a $5.9 million improvement year-over-year [40] Business Line Data and Key Metrics Changes - The wholesale business delivered triple-digit year-over-year growth, with overall wholesale revenue increasing by 143% in 2025 [12][28] - Special occasion and event wear continued to outperform, contributing to a healthier average order value and a sequential improvement in net revenue comparisons [9] - Casual and footwear categories saw a strategic reduction in new product introductions, with a 28% decrease in Q4 2025 compared to Q4 2024 [24] Market Data and Key Metrics Changes - The company expanded its wholesale presence to nine major retail partners, including a nationwide expansion into all Nordstrom stores [12][13] - The share of event wear as a percentage of total revenue increased from approximately 48% in Q4 2022 to 61% in Q4 2025, indicating a shift in consumer preferences [22] Company Strategy and Development Direction - The company is focusing on enhancing casual and footwear categories to improve order economics and drive repeat purchases [21] - Strategic initiatives include expanding wholesale presence, leveraging technology for customer engagement, and optimizing product assortments [8][33] - The company aims to prioritize profitability and quality of assortment over short-term revenue growth, particularly in casual and footwear categories [16] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to navigate near-term volatility while strengthening long-term margin structure [18] - The company anticipates improved profitability during peak selling periods in Q2 and Q3 of 2026, with expectations for positive Adjusted EBITDA growth compared to 2025 [45] - Management acknowledged ongoing challenges in repositioning casual and footwear categories but remains optimistic about future growth opportunities [7][15] Other Important Information - The company appointed Heidi Crane as the permanent CFO, emphasizing her financial discipline and strategic insight [19] - A board-approved amendment to decrease the number of authorized shares of common stock from 250 million to 15 million is pending stockholder approval [20] Q&A Session Summary Question: What are the expectations for revenue growth in 2026? - The company expects net revenue growth to improve year-over-year compared to the 11% decline in 2025, with a focus on aligning assortment with customer demand [45] Question: How is the company addressing the challenges in casual and footwear categories? - The company is narrowing its assortment and focusing on higher quality product launches to better match customer preferences and improve margins [15][24]

Financial Data and Key Metrics Changes - Innventure's consolidated revenue increased from $1.2 million in 2024 to $2.1 million in 2025, with Accelsius revenue rising from $0.3 million to $1.6 million during the same period [30][31] - General and administrative expenses decreased from $29.7 million in Q4 2024 to $11.5 million in Q4 2025, reflecting a 61% reduction [32][34] - Adjusted EBITDA for 2025 was a loss of $78.8 million, with expectations for substantial improvement in 2026 due to contracted backlog and revenue scaling [35][36] Business Line Data and Key Metrics Changes - Accelsius secured over $50 million in contracted backlog in Q1 2026, indicating a shift from pilot programs to commercial production orders [10][31] - AeroFlexx reported a near-term commercial pipeline of just under $30 million, with significant partnerships including Aveda [19][51] - Refinity achieved its first metric ton of circular product from plastic waste within a year of formation, with plans for a demonstration plant by 2028 [24][25] Market Data and Key Metrics Changes - The demand for two-phase cooling technology in data centers is expected to grow significantly, with forecasts indicating compound annual growth rates ranging from low double digits to mid-30% over the next decade [13][14] - The SAF market is anticipated to grow at 30%-50% annually, reaching $40 billion by 2034, highlighting the potential for Refinity's technology [23] Company Strategy and Development Direction - Innventure is transitioning from a capital-funded model to a commercially self-funding structure, with operating companies increasingly raising their own capital [8][29] - The company aims to achieve consolidated cash flow positivity by 2028, driven by the growth of its operating companies [7][28] - The focus is on executing a diversified strategy across multiple operating companies rather than relying on a single asset [26] Management's Comments on Operating Environment and Future Outlook - Management emphasized that the current momentum across all operating companies is a decisive inflection point, with strong visibility into future revenue growth [5][28] - The company acknowledges supply chain constraints affecting delivery timelines but remains confident in the demand for its technologies [10][11] - Management believes the current share price does not reflect the true value of Innventure, with significant gaps between market valuation and operational performance [27] Other Important Information - Innventure's cash position improved significantly, ending 2025 with $65.4 million in cash and equivalents, up from $11.1 million at the end of 2024 [35][36] - The company repaid its convertible debentures, simplifying its capital structure and improving its cost of capital outlook [36] Q&A Session Summary Question: Can you discuss the types of customers in Accelsius's $50 million in contracted orders? - Management indicated that there are hundreds of customers in the pipeline, with expectations for a broader and more diversified range of purchase orders moving forward [43][44] Question: How long do customers typically evaluate the technology before committing? - Most customers have moved past the evaluation phase, with many now placing significant commercial production orders [47] Question: Can you provide more detail on AeroFlexx's $30 million pipeline? - AeroFlexx is transitioning to large-scale adoption, with Aveda as a significant partner, and expects to broaden its reach within the Estée Lauder brand [51][53] Question: Is there more room for G&A optimization? - Management is focused on efficiency and continues to seek ways to reduce G&A expenses, with a history of significant reductions since going public [55][56] Question: What is the outlook for COGS to revenue ratio normalization? - Management noted that the current increase in COGS is due to building inventory based on projected orders, and expects normalization as revenue scales [60][62]

Financial Data and Key Metrics Changes - For Q4 fiscal year 2026, revenue was $127.1 million, representing a 16% year-over-year increase, primarily driven by Payment Solutions following the AccessOne acquisition [12] - Adjusted EBITDA reached $29.4 million, up from $16.4 million in the same period last year, resulting in an adjusted EBITDA margin of 23% [12] - Free cash flow was $28.5 million, an increase of $19.3 million year-over-year, marking the strongest quarterly free cash flow to date [15] - The company achieved positive GAAP net income for the first time in its history as a publicly traded entity [6] Business Line Data and Key Metrics Changes - Average Healthcare Services clients (AHSCs) increased to 4,658, up by 138 from the previous quarter, with 80 of these clients coming from the AccessOne acquisition [12] - Total revenue per AHSC was $27,279, reflecting an 8% year-over-year increase [12] Market Data and Key Metrics Changes - The healthcare industry is facing challenges, including FDA guidelines, insurance coverage, patient utilization, and provider reimbursement, impacting overall market dynamics [8] - Specific segments, such as life sciences, are experiencing shorter visibility into spending commitments from pharmaceutical manufacturers, affecting the Network Solutions business [9] Company Strategy and Development Direction - The company is focusing on growth initiatives such as provider financing and HCP marketing, with the AccessOne acquisition being central to its strategy [6][7] - The launch of ProviderConnect aims to enhance healthcare provider marketing, leveraging existing capabilities from PatientConnect [7] - The company is committed to building a financial profile that allows for flexibility in pursuing growth opportunities while maintaining resilience against market challenges [8] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the tough market conditions but emphasized the company's strong financial position and ability to adapt to challenges [8][10] - The revenue outlook for fiscal year 2027 has been lowered to a range of $510 million to $520 million due to reduced visibility into spending commitments from certain clients [17] - Despite the revenue reduction, the Adjusted EBITDA outlook remains unchanged at $125 million to $135 million, reflecting operational efficiency gains [18] Other Important Information - The company completed a refinancing of its bridge loan, securing a new $275 million senior secured revolving credit facility [16] - Cash and cash equivalents as of January 31, 2026, were $73.8 million, down from $84.2 million a year prior [15] Q&A Session Summary Question: Dynamics in the Network Solutions end market and guidance change - Management indicated that the reduced visibility is not broad-based but specific to certain brands and therapeutic areas, such as vaccines and public health [22][23] Question: ProviderConnect's contribution to HCP marketing - Management noted that ProviderConnect is still in early stages and its impact on revenue outlook is minimal at this time [27] Question: Impact of price negotiations on pharma clients' budgeting - Management clarified that current challenges are not primarily tied to price negotiations but rather to specific regulatory activities affecting certain therapeutic areas [30] Question: Cost actions contributing to unchanged EBITDA guidance - Management emphasized ongoing capital investments and efficiency improvements as key factors supporting the EBITDA outlook despite revenue reductions [34] Question: Growth expectations for AccessOne - Management highlighted plans to expand AccessOne's capital base and integrate it with Phreesia's existing client base while also exploring new market opportunities [45][74] Question: Visibility into Network Solutions revenue - Management confirmed that the lack of visibility primarily affects the second half of the fiscal year, with Q1 showing stronger performance than expected [87]

Financial Data and Key Metrics Changes - Total revenues for 2025 were $27.9 million, down 27% year-over-year, with software and services revenues down only 15%, making up 49% of the revenue portfolio, up from 42% in 2024 [11][3] - Gross profit was $13.3 million, down 15% compared to the previous year, with gross margins at 47.6%, up 6.7 percentage points from 2024 [14][11] - Q4 revenues were $4.8 million, down 43% year-over-year, with gross margins at 49.1%, up 8.4 percentage points compared to Q4 2024 [16][14] Business Line Data and Key Metrics Changes - Software and services revenue continued to comprise over 50% of total revenue in Q4, contributing to gross margin expansion [3][16] - The annualized contract value of renewable software was $9.9 million, down 12% year-over-year, with net dollar revenue retention at 71% for customers with at least $50,000 of annual contract value [12][11] - Bookings for the twelve-month period ending December 31 were $26.1 million, down 34% year-over-year [12] Market Data and Key Metrics Changes - CTE customers drove 56% of bookings value in Q4, down from 58% in Q4 2024, indicating a slight shift in customer engagement [16][12] - The company highlighted significant customer wins in various regions, including Pennsylvania and California, showcasing the demand for immersive AR/VR technology in education [5][6] Company Strategy and Development Direction - The company made structural changes to align with macroeconomic headwinds and announced additional capital via Planet One and Itria [4][3] - The launch of zStylus One, an AI-enabled stylus, aims to enhance precision and simplify AR deployment, indicating a focus on product innovation [5][4] - The company is leveraging AI for global expansion and accessibility, enabling quick translation across platforms to broaden its reach [8][9] Management's Comments on Operating Environment and Future Outlook - Management expressed cautious optimism for 2026, citing ongoing macroeconomic uncertainty and delays in opportunities due to geopolitical issues [9][20] - The company aims for adjusted EBITDA performance close to breakeven in 2026, contingent on revenue growth and cost reductions [20][33] - Management noted that the funding outlook for K-12 education remains uncertain but is showing signs of stabilization [28][27] Other Important Information - The company undertook significant restructuring in December 2025, eliminating approximately half of its FTE positions and reducing board size [19][20] - The company reported approximately $1 million in cash equivalents as of December 31, 2025, down from $4.9 million a year prior [18] Q&A Session Summary Question: What does the funding outlook look like for 2026? - Management acknowledged that about 10% of K-12 funding comes from federal sources and noted that funding disruptions made school districts hesitant to order or renew [24][26] Question: How has Q1 gone so far? - Management indicated that Q1 is back-end loaded, with encouraging signs in January and February, but mixed results in March due to geopolitical issues affecting customer opportunities [29][30] Question: Can you frame the significance of recent customer wins? - Management categorized recent deals as significant, with potential contributions to revenue, particularly from established customers like Atlanta Public Schools [41][42] Question: Is CTE growing compared to other business segments? - Management confirmed that CTE is growing, now representing over 50% of the business, driven by federal funding [46][48] Question: What is the outlook for achieving breakeven EBITDA in 2026? - Management expressed that with continued margin expansion and reduced operating expenses, breakeven adjusted EBITDA is within reach [49][33]