NextGen Healthcare, Inc.

Welcome to the NextGen Healthcare Fiscal 2023 First Quarter Financial Results Conference Call. Hosting the call today from NextGen is David Sides, President and Chief Executive Officer, Jamie Arnold, Executive Vice President and Chief Financial Officer, and Matt Scalio, Vice President of Investor Relations. Today's call is being recorded, and now I will turn the call over to Matt Scalio.

Thank you, and before we start, I'd like to remind everyone that the comments made on this call may include statements that are forward-looking within the meaning of the federal securities laws, including, and without limitations, statements related to anticipated industry trends, the company's plans, future performance, products, perspectives, and strategies. Risks and uncertainties exist that may cause results to differ materially from those expressed in forward-looking statements. including, among others, those risks set forth in the company's public filings with the U.S. Securities and Exchange Commission, including the discussion under the heading Risk Factors in the company's most recent annual report in the Form 10-K and any subsequent quarterly report in Form 10-Q. Any forward-looking statements speak only as of today. The company expressly disclaims any intent or obligation to update these forward-looking statements. Our remarks on today's call include both our earnings results and guidance, which contains certain non-GAAP financial measures. For our earnings results, the GAAP financial measures most directly comparable to each non-GAAP financial measure used or discussed and a reconciliation of the differences between each non-GAAP financial measure and the comparable GAAP financial measure can be found within our latest quarterly earnings release that was filed with the SEC and is posted to the investor relations section of our website. This release also provides qualitative descriptions of how we have calculated the non-GAAP financial measures contained in our guidance. At this time, I'd like to turn the call over to our president and CEO, David Sides.

Thank you, Matt. I'm pleased to report another solid performance for our fiscal first quarter. Our commercial team continues to execute, closing a handful of seven-figure wins while delivering 14% bookings growth. These sizable wins, from both inside and outside our base, reflect NextGen Healthcare's focus on the independent provider and our comprehensive offerings that enhance the client's ability to achieve better clinical and financial results. We continue to see wins across a range of medical specialties, from ophthalmology, to orthopedics, to integrated multi-specialty groups. And once again, new clients accounted for over 25% of fiscal first quarter bookings. We believe these trends support our confidence and our growth acceleration in the fiscal second half. As for key revenue growth drivers this quarter, I call out our subscription services revenue line grew a healthy 12% and reflects double-digit growth in next-gen office, and cross-selling of our surround solutions into our enterprise base. We remain on track to achieve our target $100 million and contracted annualized recurring revenue for the surround solutions by the end of fiscal year 24. In response to some recent investor questions regarding general market conditions, I wanted to reiterate our positive outlook for the independent ambulatory market and NextGen's business model. We continue to see overall practice volumes at healthy pre-pandemic levels. This shows in our volume-driven businesses such as data and reflects an ongoing industry trend of procedure volumes migrating out of higher cost settings, like hospitals, favoring lower cost settings and independent healthcare providers. We also continue to see healthy activity levels in our current pipeline. Development activities such as lead generation and demos reflect a positive demand environment. We are not seeing much impact from economic concerns. We continue to constructively engage prospects and our clients to find ways to achieve better outcomes for all. Since our last earnings call, I've had the opportunity to meet with our largest clients in person or at our large client user group, at client sites, and at our Leaders in Healthcare Summit. They're excited about our move to cloud-native technology enhanced mobile capabilities, and our insights. It was good to get confirmation that our strategies that focus on outcomes align with our clients' strategies. So from what we are seeing from the market, our positive outlook has not changed. Turning to NextGen's business model, 91% of our revenue is recurring in nature, and we have no customer concentration risk. And we are building on this steady foundation to achieve our long-term goals. We continue to make progress on certain strategic initiatives. In fact, today we announced the sale of certain dental assets, a legacy part of the company. Through our more disciplined portfolio management process, we move forward with monetizing these non-strategic assets. It's important to note that we are adjusting our fiscal 23 financial guidance strictly to account for this transaction. Another example of our progress is the expanded relationship with Instamed that we recently announced. We are pleased that our patient pay offering is now even more accessible and easy to use for both patients and clients. We expect patient pay to contribute to fiscal year growth, and its contribution is already incorporated into our fiscal year guidance. Now let me ask Jamie to provide further details.