Waystar Holding Corp. · NASDAQ:WAY
Waystar — Q2 2024 Earnings Presentation
16 slides from Waystar's earnings presentation, Aug 7, 2024
Slide 1: 2Q24 Financial Results
E A R N I N G S PR E S E N TAT I O N 2Q24 Financial Results August 7, 2024 © 2024 Waystar. All rights reserved. | P R O P R I E T A R Y + C O N F I D E N T I A L
Slide 2: Disclaimer
DISCLAIMER This presentation contains forward-looking statements, within the meaning of the Private Securities Litigation Reform Act of 1995, that reflect our current views with respect to, among other things, statements regarding Waystar’s expectations relating to future operating results and finan
Slide 3: Non-GAAP Financial Measures
NON-GAAP FINANCIAL MEASURES To supplement the consolidated financial statements prepared and presented in accordance with U.S. generally accepted accounting principles (“GAAP”), this presentation contains certain non-GAAP financial measures as defined below. We present non-GAAP financial measures as
Slide 4: Key Performance Metrics
KEY PERFORMANCE METRICS Net Revenue Retention Rate Our Net Revenue Retention Rate compares twelve months of client invoices for our solutions at two period end dates. To calculate our Net Revenue Retention Rate, we first accumulate the total amount invoiced during the twelve months ending with the p
Slide 5: Key Highlights: Strong Q2 performance
20% Revenue growth2 12% Adjusted EBITDA growth3 KEY HIGHLIGHTS C O N F I D E N T I A L Strong Q2 40% $50M performance Adjusted EBITDA Unlevered free + margin3 cash flow3 P R O P R I E T A R Y Growth rates and key metrics are at or above financial targets1 9% 108% | © 2024 Waystar. All rights reserve
Slide 6: Key financial metrics
Q 2 R E S U LT S Key financial metrics Strong double-digit growth in revenue and adjusted EBITDA; normalized for a few favorable factors, Q2 revenue grew slightly above expected low-double digit long-term target Revenue Adjusted EBITDA1 Non-GAAP Diluted EPS2 C O N F I D E N T I A L $234.5 $93.9 $0.0
Slide 7: Revenue by type
Q 2 R E S U LT S Revenue by type Consistent and durable YoY revenue growth in subscription and volume-based revenue; 99% of revenue is derived from software $250 C O N F I D E N T I A L $200 13% $121 YoY growth in $117 $150 $94 $102 subscription revenue + $94 $96 $87 (above the 8-10% range in P R O
Slide 8: Client growth + NRR
Q 2 R E S U LT S Client growth + NRR Clients with >$100k ARR grew 9% YoY; Net Revenue Retention was 108% in Q2’24 Clients with >$100K ARR Net Revenue Retention 7-9% Growth range over the last 6 quarters NRR of 108% in second quarter C O N F I D E N T I A L 120% 1,900 118% 1,700 116% 114% 1,500 109%
Slide 9: Net leverage ratio
Q 2 R E S U LT S Net leverage ratio Paid down +$1 billion in debt and repriced loan to reduce cost of capital and enhance ability to allocate free cash flow towards growth initiatives C O N F I D E N T I A L 7.5x 90 bp s Reduced interest 6.6x expense by over 29 0b $100M ps + P R O P R I E T A R Y •
Slide 10: Unlevered free cash flow
Q 2 R E S U LT S Unlevered free cash flow 78% and 67% conversion of adjusted EBIDTA2 uFCF in FY22 and FY23, respectively; 1H’24 conversion of 51% impacted by temporary working capital changes $300 C O N F I D E N T I A L $230M $223M $250 $200 FY23 includes an incremental $144 $136M $46M of cash taxe
Slide 11: FY2024 Guidance
FY2024 Guidance 15% revenue growth and 40% Adjusted EBIDTA margin at midpoints1 FY'24 Guidance FY'23 Actual YoY% Change C O N F I D E N T I A L Low High Low High Revenue $902M $918M $791M 14% 16% + P R O P R I E T A R Y Adjusted EBITDA $360M $368M $334M 8% 10% Non-GAAP Net Income $36M $42M ($39M) NM
Slide 12: FY2024 Guidance assumptions
• Subscription growth of +10% YoY • Volume-based growth of +10% YoY • Seasonally lower patient payment volumes in 2H’24 • Continued investment in client support, innovation, and C O N F I D E N T I A L FY2024 cybersecurity Guidance • ~$3M in public company costs in 2H’24 • ~$55M is stock-based compe
Slide 13: Appendix tables
Appendix tables © 2024 Waystar. All rights reserved. | P R O P R I E T A R Y + C O N F I D E N T I A L
Slide 14: GAAP Quarterly Income Statement
GAAP Quarterly Income Statement Unaudited, in thousands, except per share amounts Consolidated Statements of Operations – Quarterly 2Q 22 3Q 22 4Q 22 1Q 23 2Q 23 3Q 23 4Q 23 1Q 24 2Q 24 Revenue 173,379 177,973 182,102 191,083 195,969 197,263 206,695 224,792 234,543 Cost of revenue (exclusive of depr
Slide 15: Non-GAAP Quarterly Income Statement
Non-GAAP Quarterly Income Statement Unaudited, in thousands, except per share amounts Non-GAAP Consolidated Statements of Operations - Quarterly 2Q 22 3Q 22 4Q 22 1Q 23 2Q 23 3Q 23 4Q 23 1Q 24 2Q 24 Revenue 173,379 177,973 182,102 191,083 195,969 197,263 206,695 224,792 234,543 Cost of revenue (excl
Slide 16: Non-GAAP Reconciliations and Key Metrics
Non-GAAP Reconciliations and Key Metrics Unaudited, in thousands, except per share amounts Reconciliation of Non-GAAP Adjusted EBITDA 2Q 22 3Q 22 4Q 22 1Q 23 2Q 23 3Q 23 4Q 23 1Q 24 2Q 24 Net Loss (10,878) (10,474) (15,533) (10,623) (10,810) (15,486) (14,415) (15,932) (27,685) Interest expense 35,74