CareCloud, Inc. Q2 FY2025 earnings call

• AI-driven innovation: Launched AI Center of Excellence, with 100 full-time AI professionals and 100 interns. cirrusAI Notes and Voice gaining traction. AI embedded in real-world workflows to improve efficiency. - Operational discipline: Continued financial discipline, resuming preferred dividend payments with 9 consecutive months of distributions. - Sustainable growth: Completed 2 acquisitions aligned with specialty AI-powered RCM. Certification of talkEHR platform for critical access hospitals, opening a $1.5 billion addressable market.

In the second quarter of 2025, CareCloud reported GAAP net income of $2.9 million, an improvement of 73% from $1.7 million in the same period last year. Revenue for the quarter was $27.4 million, down slightly year-over-year due to a one-time non-recurring revenue item in Q2 2024. CareCloud Wellness generated approximately $1 million in revenue for the quarter. Adjusted EBITDA stood at $12.1 million, a 20% increase year-over-year, and free cash flow reached $9 million, up 85% over the same period. Year-to-date, revenue was $55 million, GAAP net income was $4.9 million, and adjusted EBITDA was $12.1 million.

• Reaffirmed full-year 2025 guidance: Revenue between $111 million and $114 million, adjusted EBITDA in the range of $26 million to $28 million, and GAAP earnings per share between $0.10 and $0.13.

Q: Could you talk about the spend on the AI Center of Excellence and its relation to potential revenue-generating opportunities?

A: Hadi Chaudhry said it's three-fold: top line with new products, making existing products AI-enabled to be more competitive, and back office optimization to improve margins.

Q: How is the sales approach for new offerings like critical access hospitals?

A: Hadi Chaudhry and Stephen Snyder discussed targeting specialty practices, focusing on critical access hospitals with a unique EHR solution and strategic approach.

Q: Comment on medSR remote patient monitoring and chronic care management performance?

A: Stephen Snyder said medSR revenue base is largely stable, RPM revenue mix is expected to be about 5% or less.

Q: Commentary on seasonality for 3Q and 4Q?

A: Norman Roth said Q3 and Q4 2025 are expected to mirror last year with modest increases, similar to Q1 and Q2 strength.

Q: Comments on capitalized software and customer conversations with AI enhancements?

A: Norman Roth said cap software is for improvements to existing platforms making them more AI-focused. Hadi Chaudhry mentioned positive customer conversations with high adoption rates of AI tools like cirrusAI Notes after trials.