Weave Communications, Inc.

Greetings and welcome to the Weave Second Quarter 2024 Financial Results Conference Call. At this time, all participants are in a listen-only mode. A brief question and answer session will follow the formal presentation. Should anyone require operator assistance during the conference, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Mark McReynolds, Head of Investor Relations. Thank you. You may begin.

Thank you, Saatchi. Good afternoon, and welcome to WEAVE's second quarter 2024 earnings call. With me on today's call are Brett White, CEO, and Alan Taylor, CFO. During the course of this conference call, we will make forward-looking statements regarding the anticipated performance of our business. These forward-looking statements are based on management's current views and expectations and tell certain assumptions made as of today's date and are subject to various risks and uncertainties described in our SEC filings. we've disclaimed any obligation to update or revise any forward-looking statements. Further, on today's call, we will discuss certain non-GAAP metrics that we believe aid in the understanding of our financial results. Unless otherwise noted, all numbers we talk about today will be on a non-GAAP basis. A reconciliation to comparable GAAP metrics can be found in today's earnings release, which is available on our website and as an exhibit to the Form 8K furnished with the SEC before this call. as well as the earnings presentation on our investor relations website at investors.getweave.com. And with that, I will now turn the call over to Brett.

Thank you, Mark. And thank you to everyone for your participation today. I'd like to start today's call with financial highlights from Q2. I'm thrilled to share that we had an outstanding quarter, continuing our track record of improving financial performance and setting the stage for a strong second half of the year. We delivered another quarter of solid top line performance, significant gross and operating margin improvements, and for the first time in our company's history, positive adjusted EBITDA. Revenue for Q2 was $50.6 million, representing 21.4% year-over-year growth, compared to 19.2% growth last quarter and $1.4 million above the high end of the range that we provided in May. Gross margin reached 71.9%, 400 basis points greater than Q2 of last year, marking our 10th consecutive quarter of gross margin improvement. Additionally, our adjusted EBITDA margin improved by over 700 basis points from last year. These results highlight the continued strong demand for our software and payments platform and our ongoing commitment to business efficiency. Our mission is to enhance healthcare experiences for every practice, patient, and interaction. We have created a comprehensive customer experience software and payments platform tailored to small and medium-sized healthcare practices. Our solution empowers healthcare providers to focus on patient care while we optimize office operations, manage payment processing, and drive practice growth for enhanced patient communication and engagement. For over 15 years, we have delivered solutions that meet the unique needs of SMB healthcare providers. These providers often lack dedicated IT teams and depend on intuitive software like Weave. Our platform integrates with these practices' system of record and simplifies attracting, engaging, and retaining patients. Our total addressable market in the U.S. exceeds 7 billion, including specialty medical, our third largest and fastest growing vertical market, where growth rates accelerated again in Q2. In addition to new customer growth, we have substantial opportunities to increase our share of wallet within our current customer base. First, we are enhancing our payments platform by embedding digital collections processes into communication workflows, including text-to-pay and online payments, all using the trusted practice telephone number. 65% of patients say they would be more likely to choose a healthcare provider if offered flexible ways to pay for services. Weave makes it easy for providers to offer buy now, pay later and payment plans, which help increase conversion from consultation to accepted treatment. Weave Payments helps practices streamline revenue cycle management, modernizing the payment processing workflow and improve collection efficiency. In Q2, we welcomed Greg Laios to the newly created position of General Manager of Weave Payments. Greg brings an extensive FinTech background to our team and will focus on expanding the adoption of Weave Payments within our customer base and broadening our payments offering. This includes improving our payments platform for multi-location practices by streamlining reconciliation processes and improving analytics and reporting tools to optimize billing and collection performance. Next, we are adding and deepening authorized and certified partner integrations, expanding our addressable market and strengthening product market fit. This improves our customer experience and ability to upsell customers to premium offerings. Integrations power automated and personalized communications, which increase operational efficiency, improve patient engagement, and boost practice growth. These efforts have a clear correlation with higher average sales prices and improved retention rates. Additionally, we continue to develop innovative solutions that simplify office operations, including AI-driven assistance. Staffing often represents the largest line item in a practice's budget, making staff efficiency and effectiveness critical to practice profitability. On average, 30% of calls into a practice during business hours go unanswered. Our AI-driven solutions will address this issue by capturing these otherwise missed revenue opportunities. This not only helps practices run more efficiently, but also frees up staff to focus on delivering exceptional patient care. Finally, we continue to enhance the marketing tools in our platform and improve practice analytics and insights to help customers expand their audience and grow their business. By broadening our offerings, we aim to boost our value proposition, foster deeper customer relationships, drive long-term loyalty and growth, and capture a larger share of our customers' budgets. Transitioning to partnerships, we have made significant strides this year, and I'd like to highlight a few key accomplishments. Year-to-date, we've delivered 20 new integrations, including eClinical Works, EasyVet, InfiniteVT, and Shepard. opening up our addressable market by more than 86,000 locations. We also expanded integrations with several existing partners and enabling an enriched customer experience with products like digital forms, online scheduling, and payments. In July, we jointly announced a commercial partnership with Patterson Dental, the second largest dental practice management software provider globally. This agreement allows Patterson Dental to sell Weave directly into the roughly 100,000 locations that their sales team engages with. Our integrations with Patterson Practice Management Software Fuse and EagleSoft now have the most complete data exchange available, including payment writebacks to the ledger. Deepened integrations with Dolphin Management, Dolphin Cloud, and Dolphin Blue are also in development. Our team continues to work on other leading systems of record on similar commercial and integration partnerships. Finally, in Q2, we launched an affiliate partner marketplace to showcase best-in-class technology and services for healthcare practices. This initiative opens up additional revenue streams through recommended patient experience solutions that meet our customers' evolving needs. In addition to delivering new and deepened partner integrations, we've been diligently developing our next generation platform, which modernizes our product infrastructure and improves usability. Key improvements include dynamic sizing to optimize screen real estate, enhanced personalization, multitasking capabilities, and auto updates. This rebuilt experience also enables we to scale with a more robust and modern technology framework. In June, we were thrilled to announce Weave Enterprise. This new solution for practices with multiple locations is built entirely on our next-generation platform. It is designed to help dental service organizations, vision, veterinary, and medical groups standardize their operations and streamline revenue cycle management. Weave Enterprise provides a centralized way to manage dozens or even hundreds of offices seamlessly. Weave Enterprise also provides powerful insights and analytics enabling the evaluation of trends, performance benchmarking, and discovery of actionable data across locations. Finally, we continue to invest in both predictive and generative AI, leveraging over a decade of call, text, and voicemail data to train our large language models. This extensive data set, along with our dedicated AI team, uniquely positions us within the industry, giving us a competitive edge in developing AI solutions that deliver efficiency and productivity for healthcare practices. Weave has consistently received accolades that affirm our commitment to our customers' experience and the industry-leading performance of our platform and team. Weave was again recognized by G2 in their summer 2024 report, ranking first in 27 categories being named a leader in the grid for patient relationship management and a top 50 software product for small businesses. We're also proud to be recognized for our commitment to creating an outstanding workplace. We was honored on Inc.' 's annual best workplaces list and the 2024 parody list, celebrating companies with exceptional work environments and inclusive cultures. In closing, I'm immensely proud of what the team has accomplished in Q2, continuing the strong start to the year. We accelerated our top-line growth, reached a very significant milestone of positive adjusted EBITDA. This success is a testament to our dedication to providing innovative solutions that address our customers' needs. I'd like to extend a big thank you to our customers, partners, team members, and shareholders for their continued support of WEED. With that, I'll turn the call over to Alan to provide more detailed financial results and review our outlook.