Waystar Holding Corp.

Good day, and thank you for standing by. Welcome to the Waystar first quarter 2025 earnings conference call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you will need to press star 11 on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star 11 again. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, Sandy Draper, Vice President of Investor Relations. Please go ahead.

Thank you, Operator, and good afternoon, everyone. It is my pleasure to welcome you to Waystar's first quarter 2025 earnings call. Matt Hawkins, Waystar's Chief Executive Officer, and Steve Oreskewicz, Waystar's Chief Financial Officer, are joining me today. After their remarks, we will open the call to your questions. This afternoon, we issued a press release announcing our financial results and a presentation slide deck to accompany our prepared remarks. The materials are available on the investor relations section of our website at investors.waystar.com. Before we get started, I will remind you that this call contains forward-looking statements, which are predictions about future events. Examples of these statements include expectations of future financial results, growth, and margins. These statements involve a number of risks and uncertainties that may cause actual results to differ materially from those expressed in these statements. For a full discussion of the risks and other factors that may impact these forward-looking statements, please refer to this afternoon's press release and the reports we filed with the SEC, all of which are available on the investor relations page of our website. Any forward-looking statements provided during this call are made only as of the date of this call. During today's call, we will also discuss certain non-GAAP financial measures. We have provided reconciliations of the non-GAAP financial measures, including our remarks to the most directly comparable GAAP measures, together with the explanation of these measures in the appendix of the presentation slide deck and our earnings release. Lastly, We're pleased to note our participation in the Bank of America Healthcare Conference in Las Vegas on May 13th and the William Blair Growth Stock Conference in Chicago on June 3rd. We look forward to seeing many of you there. With that, I'll turn it over to Matt.

Thank you, Sandy, and good afternoon, everyone. Thank you for joining our first quarter 2025 earnings call. Waystar delivered a strong start to the year with Q1 revenue growth of 14%. and adjusted EBITDA increase of 16% year over year. This momentum positions us to raise our full year guidance, which Steve will discuss in more detail shortly. I want to begin by emphasizing why Waystar is uniquely equipped to create long-term shareholder value independent of broader market conditions, given the increasing macro volatility since our last conversation. While no business or sector is entirely insulated from economic cycles, we believe Waystar's broad presence and business model are recession resistant. We are confident in our ability to deliver strong performance. Our software has enabled providers to succeed despite the challenges of an unpredictable environment. We serve over a million U.S.-based providers who practice across every care setting. from large established integrated delivery networks to small independent physician practices. Waystar's software platform is embedded in our client's workflow and plays a mission critical role in helping providers get paid faster and more accurately while reducing administrative costs. In times of volatility and market stress, Waystar software can be deployed rapidly and efficiently to help providers optimize cash flow, which is essential in challenging economic conditions. While the new administration is discussing several potential policies that could impact the U.S. healthcare industry, we do not anticipate any major impact in 2025. In fact, if new policy proposals confront healthcare providers, their reliance on software platforms such as Waystars will likely strengthen. to maximize revenue capture and streamline operational efficiency. Our agility in delivering hundreds of new software capabilities through our cloud platform each quarter gives us confidence that we can help clients address changes as they arise. Turning to our first quarter performance, I'll cover four key areas that highlight our progress and future direction. First, I'll discuss our sustainable and compounding revenue growth. Second, I'll highlight the latest innovations creating value for our clients. Third, I'll share how we are driving operational profitability and efficiency. And fourth, I'll review recent client and team member successes. Then I'll turn the call over to our CFO, Steve, who will review our financial results for the first quarter and discuss our increased 2025 guidance. First, sustainable growth. Waystar delivered another quarter of strong top-line growth, generating $256 million in revenue, a 14% year-over-year increase. Our ability to sustain consistent performance is anchored in our strategy of building enduring client relationships, which is reflected in our 114% net revenue retention rate. We continue to expand those client relationships over time with 1,244 clients now generating more than $100,000 in trailing 12-month revenue, a 15% increase year over year. We continue to experience strong demand fueled by our differentiated cloud-based software platform, exceptional client service, and the measurable return on investment we deliver to our clients. To validate and quantify the key drivers behind today's market demand, we recently conducted a large independent study in partnership with Qualtrics, surveying 600 revenue cycle leaders from provider organizations of all types and sizes. Providers want strong ROI, operational efficiency, and data security. When selecting an RCM technology vendor, 92% of respondents identified AI, advanced automation, and trust as top investment criteria. Waystar's AI-powered platform is purpose-built to meet those priorities, combining proven outcomes with advanced technology designed to deliver results at scale, reinforcing our growing market leadership. This brings us to another key driver of sustainable revenue growth, platform innovation. At Waystar, our purpose is to simplify healthcare payments. We are pursuing a strategic and ambitious software product roadmap focused on scale, automation, efficiency, and substantial ROI. Last week, we held the Waystar Innovation Showcase. At this event, we demonstrated new capabilities powered by generative AI and advanced automation to prevent and address denied claims, accelerate reimbursement, and provide an integrated, intuitive, digital-first patient payment experience. The Innovation Showcase builds on the momentum of our January 2025 launch of Altitude AI, Waystar's comprehensive suite of AI capabilities designed to help providers streamline workflows and improve financial performance. We were pleased with the tremendous client and prospect engagement during the Waystar Innovation Showcase, where thousands of clients and prospects joined to experience our latest innovations firsthand. We observed that budgets for Gen AI-enabled solutions are increasingly being centrally pooled and funded at the largest provider organizations. These resources often sit outside traditional healthcare IT budgets. Incremental pools of capital are being allocated to fund key initiatives that deliver real ROI. Providers are looking for trusted, at-scale vendors to help them reimagine and organize traditional processes end-to-end. They expect Gen AI solutions to improve productivity, increase automation in high-volume, low-complexity tasks, boost accuracy, and accelerate time to payment. Waystar Software advocates for providers and patients by dramatically reducing the likelihood of claim denials and by helping clients respond rapidly and efficiently when denials do occur. We help prevent denied claims through strong patient access solutions, including eligibility and prior authorization automation and AI-powered insurance coverage detection. Securing payer prior authorization manually can take up to 24 minutes per request. With tens of millions of authorizations processed annually, the burden on providers is significant and the patient experience is often frustrating. In Q1, we enhanced Waystar Authorization Manager to include our new Auth Accelerate solution and additional use cases for auth status. Auth Accelerate unlocks auto approvals and significantly reduces manual staff workload. Early adopter clients are already seeing measurable results, an 85% auto approval rate and a 70% reduction in time spent on authorizations. With this launch, we are scaling our prior authorization capabilities for key payers across the ambulatory market, including radiology, cardiac imaging, and surgery centers, with more specialties and payer expansions underway. Our clients use Waystar's AI-powered software, Altitude Create, to appeal denied claims. The platform autonomously gathers claim information and generates appeal packages three times faster than traditional services. Waystar helps providers receive rightful reimbursement as quickly as possible. In the first 90 days post-launch, clients reported a more than 40% increase in overturn rates. These results demonstrate a clear impact on both operational efficiency and reimbursement outcomes. Trust and security are fundamental to Waystar's software platform. We continually invest in cybersecurity best practices for deterrence, detection, defense, and rapid recovery. We maintain high cybersecurity standards and regularly audit our platform against industry-leading frameworks. Next, profitability and efficiency. We sustained our trend of strong adjusted EBITDA performance. with Q1 adjusted EBITDA of $108 million, representing a 16% year-over-year increase. This result underscores the high margin nature of our software platform and our consistent ability to meet our long-range target of approximately 40% adjusted EBITDA margins, while strategically investing in innovation, growth, and cybersecurity. Together, Our profitability and cash flow profile provide ample flexibility to invest in the business, reduce debt, and thoughtfully pursue M&A. We are focused on deploying this capital in ways that drive durable growth and maximize value for our investors. We are pleased to report that our net leverage ratio at the end of Q1 is 2.5 times. At the same time, we are continuously identifying ways to further improve profitability by operating even more efficiently. That includes scaling automation and agentic AI within our market-leading approach to client experience, all designed to continue leadership and client satisfaction. Today, 100% of clients receive US-based support and Over 40% of revenue is tied to clients, supported by a dedicated client success manager. Our team resolves 70% of service requests on the same day and answers 90% of inbound calls within 30 seconds, an industry-leading performance that reflects our commitment to responsive, high-impact client experience at scale. Finally, client and team successes. Our unique approach to focusing on our clients continues to garner recognition in the industry. We've achieved multiple number one rankings in the latest best-in-class report. We're named by BlackBook as the industry's leading AI platform and maintained a net promoter score that consistently exceeds industry benchmarks. Together, these accolades highlight the strength of our client experience and our ability to deliver innovation, speed, and scale that builds long-term trust and measurable results. As part of our market research, we captured strategic insight into Waystar's brand perception and performance. The results highlighted several key takeaways. Waystar earned the top position in both unaided and aided brand awareness, making us the most recognized brand name in healthcare payments. The market also ranked Waystar number one in both brand trust and best days ahead, a reflection of the confidence they have in our vision, pace of innovation, and long-term leadership. Additionally, we were recognized as the top choice for future RCM software investment, underscoring market confidence in our continued momentum and industry role. To ensure we gather and incorporate provider insights, we recently expanded the Waystar Advisory Board by more than 30%. This larger group includes distinguished leaders from top health systems, ambulatory providers, and strategic partners. Our ongoing strategic engagements with this group including at our most recent meeting in March, are instrumental in raising timely insights that help shape our vision and accelerate our software roadmap. In conclusion, Waystar started 2025 with momentum, purpose, and a clear vision for the future, and our Q1 results reinforce that trajectory. We are building on our proven strategy to deliver stable, enduring, and compounding growth With another quarter of strong performance, we are confident in our ability to drive innovation, deliver ROI, and help providers navigate a rapidly changing landscape. As industry dynamics evolve, Waystar is working thoughtfully to help guide the future of the industry with agility, focus, and trust. With that, I'll turn it over to Steve to walk through the financial details.