Phreesia, Inc. Q2 FY2026 earnings call

• Announced the definitive agreement to acquire AccessOne for $160 million, which will expand the addressable market by roughly $6 billion and strengthen payment solution capabilities.
• Achieved net income positive for the first time in history, with net income of $700,000 in the second quarter. Adjusted EBITDA was $22 million, up $16 million YOY with a 19% margin.
• Cofounders Evan Roberts and David Lanesky were named President of Provider Solutions and Network Solutions, respectively.
• Total revenue per average healthcare services client was $26,249, up 7% YOY and flat QOQ. Average healthcare services clients were 4,467, an increase of 56 from prior quarter and 298 from prior year.
• Ended the quarter with $98.3 million in cash and cash equivalents, operating cash flow of $14.8 million, and free cash flow of $9.6 million, achieving positive cash flow for four consecutive quarters.

Total revenue for the second quarter was $117.3 million, a 15% year-over-year increase. The acquisition of AccessOne is expected to contribute approximately $35 million in annualized revenue and approximately $11 million in annualized adjusted EBITDA. The network solutions TAM was increased by $6 billion as Phreesia expects to draw from a larger pool of life sciences marketing dollars, and the payments TAM was expanded by about $6 billion with the AccessOne acquisition, combining to increase the total addressable market approximately $24 billion from ~$10 billion.

• Maintained revenue outlook for fiscal 2026 at $472 to $482 million.
• Updated adjusted EBITDA outlook for fiscal 2026 to $87 million to $92 million from $85 million to $90 million.
• Reiterated outlook to reach approximately 4,500 AHSCs in fiscal 2026 and for total revenue per AHSC to increase compared to fiscal 2025.
• Expect to update fiscal 2026 financial outlook following the close of the AccessOne transaction.

Forward-looking statements are subject to various risks, uncertainties, and other factors that may cause actual results to differ materially from those described. Risks are detailed in earnings press release, stakeholder letter, and SEC filings, including in the quarterly report on Form 10-Q filed tomorrow.

Q: Could you elaborate on how the AccessOne deal developed and why it's the right market fit?

A: We've been watching AccessOne for years, it's a part of the market we couldn't play before due to product and regulatory reasons, and customers have indicated it would be beneficial. Aligns with our mission of making care easier.

Q: How does the Voice AI product drive opportunities in network solutions?

A: Voice AI benefits providers and patients, creating more engagement opportunities for network solutions revenue. It's off to a great start with positive feedback from providers.

Q: Who bears risk for dollars in AccessOne's payment extensions?

A: Risk is shared between PNC Bank and the provider; we help drive better solutions to patients in a technology-first way.

Q: How does the shift from internal to external AI products affect investment balance?

A: We've been investing in both internal and external AI tools, focusing on building valuable products first, and monetizing will follow as products provide value to clients