Phreesia, Inc.

Good afternoon. My name is Emma, and I will be your conference operator today. At this time, I would like to welcome everyone to the Freesia Fiscal First Quarter 2023 Earnings Conference Call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question and answer session. If you would like to ask a question during this time, simply press star followed by the number one on your telephone keypad. If you would like to withdraw your question, again, press the star one. Thank you. Balaji Gandhi, you may begin your conference.

Thank you, Operator. Welcome to Freesia's earnings conference call for the fiscal first quarter of 2023, which ended on April 30th of 2022. Joining me on today's call are Haim Indig, our Chief Executive Officer and Co-Founder, and Randy Rasmussen, our Chief Financial Officer. A complete discussion of our results can be found in our earnings press release and in our related Form 8K submission to the SEC in including our quarterly stakeholder letter, both issued after the markets closed today. These documents are available on the investor relations section of our website at ir.freesia.com. As a reminder, today's call is being recorded and a replay will be available on our investor relations website at ir.freesia.com following the conclusion of the call. During today's call, we may make forward-looking statements, including statements regarding trends or anticipated growth, our strategies, predictions about our industry, and the anticipated performance of our business, including our outlook regarding future financial results. Forward-looking statements are subject to various risks, uncertainties, and other factors that may cause our actual results, performance, or achievements to differ materially from those described in our forward-looking statements. Such risks are described more fully in our earnings press release, our stakeholder letter, and our risk factors included in our SEC filings, including in our quarterly report on Form 10-Q that will be filed with the SEC tomorrow. The forward-looking statements made on this call will be based on our current views and expectations and speak only as of the date on which the statements are made. We undertake no obligation to update and expressly disclaim the obligation to update these forward-looking statements to reflect events or circumstances after the date of this call or to reflect new information or the occurrence of unanticipated events. We may also refer to certain financial measures not in accordance with generally accepted accounting principles in order to provide additional information to investors. These non-GAAP measures should be considered in addition to and not as a substitute for or in isolation from our GAAP results. A reconciliation of GAAP to non-GAAP results may be found in our earnings release and stakeholder letter which were furnished with our Form 8K filed after the market closed today with the SEC and may also be found on our investor relations website at ir.freesia.com.

With that out of the way, let me hit a couple of the highlights from the quarter in case you have not had a chance to review the earnings release in the quarterly letter. First, our investments continue to drive strong growth in our network. In the first quarter, average healthcare services clients were up 33% year over year. Second, payment processing revenue in the quarter reflected patient utilization trends that were slightly below our expectations based on our prior experience. We think this trend could persist in the remainder of the year, which is the main reason we're maintaining our revenue outlook for the year at $271 million to $275 million. This range implies growth of 27% to 29% year over year. Third, life sciences growth was up a strong 51% year over year, and revenue was down a slight $563,000 sequentially from Q4. This sequential trend is consistent with historical periods where you see Q4 to Q1 flat to down due to seasonality. We continue to be pleased with our team's performance in this area, and we expected this team's continued performance to contribute to our overall growth in fiscal 23. And the last highlight We began to see strong operating leverage across all of our investments over the past year, which is why we've taken up the adjusted EBITDA outlook for the year to a range of negative 126 million to negative 122 million, which is up from our prior outlook of negative 154 million to negative 149 million. And before jumping into the Q&A session, let me hand it over to our CEO. I'm ending.