Health In Tech, Inc. Q2 FY2025 earnings call

• Strategic market expansion: Reached 778 partners, an 87% year-over-year increase, including partnerships with TPA, broker agencies, and large benefit platform companies.
• Billed enrolled employees: Increased 30% to 24,839, with partners leveraging AI-powered platform for integrated healthcare and insurance solutions.
• Platform development: Enhanced eDiP platform with automated large group underwriting tools set to launch in Q3; new product offerings expected to be beta tested end of Q3.
• Key partnerships: Collaborations with Vertigard, Unified Health Plans, Hillb Group, Bailey Insurance, etc., to expand reach and provide cost-saving solutions for small businesses.

For the second quarter of 2025, total revenue was $9.3 million, an 86% year-over-year increase. The first half-year revenue reached $17.3 million, which is 89% of the 2024 fiscal year total revenue. Adjusted EBITDA for Q2 was $1.6 million, a 134% year-over-year increase, and for the first half-year, adjusted EBITDA was $2.8 million, 1.2x of the entire 2024 full year. Pretax income for Q2 more than doubled year-over-year to $0.8 million, and the first half-year pretax income was $1.5 million, 1.7x of 2024 full year. Sales and marketing expenses for Q2 were $1.2 million, 13.2% of revenue, a 6.3% year-over-year reduction. General admin expenses for Q2 were $3.8 million, 40.5% of revenue, a 4.2% year-over-year increase. R&D expenses for Q2 were 6.3% of revenue, a 7.7% year-over-year reduction. Operating cash flow for Q2 was $1.5 million positive, and for the first half-year, it was $2 million positive. Accounts receivable was $1.3 million, a 12% year-over-year reduction despite 86% revenue growth.

• Enhanced eDiP platform with automated large group underwriting tools to be fully launched in Q3.
• New product offerings to be beta tested at the end of Q3.
• Confident in maintaining strong growth momentum despite slow sales seasons like Q2 and Q3.

• Forward-looking statements involve risks, uncertainties, and assumptions that could cause actual results to differ materially from those expressed. Factors discussed in the quarterly report on Form 10-Q for the period ended June 30, 2025, could cause actual results to differ from forward-looking statements.

Q: Talked about new business from partnerships and momentum before January.

A: Tim Johnson mentioned that in the fully insured market, small groups can move off effective dates at any point, allowing more sales during the year. Julia Qian added that new relationships are starting to show traction even in low seasons.

Q: Rollout of AI-backed underwriting platform and targeting midsize employers.

A: Dustin Plantholt said partnerships with large brokers are bringing in more 1000+ life cases. Tim Johnson explained that the eDiP platform enables experience-based underwriting for larger groups and is more efficient, with small group underwriting in 2 minutes and larger groups in 5 days to 2 weeks.

Q: Partnerships bringing new employers.

A: Tim Johnson and Dustin Plantholt stated that brokers bring in more opportunities as they see the efficiency of the platform, and TPAs bring in their distribution channels, leading to new employer business.

Q: Underwriting fees and larger employers.

A: Julia Qian explained that underwriting fees are a mix based on premium and services chosen by larger employers, with average premium and fee structures varying.

Q: Operating leverage and controlling expenses.

A: Julia Qian said revenue growth is expected to exceed expense growth, with disciplined expense management and technology being used to replace human work where possible.

Q: HiCard rollout.

A: Tim Johnson said HiCard rollout is part done in August and will be fully done before the end of the year, with revenue expected in Q1 next year.

Q: Pivoting to meet partner needs and response speed.

A: Dustin Plantholt and Julia Qian discussed the AI platform's speed, with small group underwriting in 2 minutes and larger groups in 5 days to 2 weeks, allowing quick response to partner needs.

Q: Market uncertainty in healthcare insurance.

A: Tim Johnson and Julia Qian mentioned high rate increases by ACA carriers and administration changes, creating opportunities for Health in Tech to provide alternatives and certainty in healthcare solutions.