TruBridge, Inc. Q1 FY2024 earnings call

• Transformation focus: Identified four areas 18 months ago (delivered results, sales execution, financial reporting/insights, operational excellence/capital investments) and has momentum in all. - Bookings: Strong first quarter with $23 million in bookings, driven by RCM and EHR wins. RCM had $14.4 million bookings, including large ambulatory network deal. EHR had $8.6 million bookings, up from $7.3 million YoY, with more deals under nTrust. - Viewgol integration: Proceeding as expected, leveraging its ambulatory presence to expand into new customer segments. - Partnerships: Announced partnership with Microsoft Nuance Dragon for speech recognition in EHR, and with Multiview for financial management application. - Operational progress: Global workforce plan rolling out, 25% of CBO and EVO offshore; software development shifted to enterprise-wide agile model; annual client conference had positive feedback, launched TruBridge Analytics solution.

In the first quarter, revenue was $83.2 million. Bookings totaled $23 million, with RCM bookings at $14.4 million (62.6% of bookings) and EHR bookings at $8.6 million (37.4% of bookings). RCM revenue was $53 million, accounting for 64% of total revenue, up 9% year-over-year. EHR revenue decreased due to the divestiture of EHD in January 2024 and the sunsetting of the Centriq product.

• Revenue: Revised full-year 2024 guidance from $340-350 million to $330-340 million due to longer implementation times for larger deals. - Adjusted EBITDA: Remains unchanged at $45-50 million, supported by $5 million in annual cost savings with at least half realized in 2024. - Second quarter: Expected revenue between $81 million and $83 million, adjusted EBITDA between $8 million and $10 million, impacted by slower implementation and typical user conference expenses.

• Timing complexity: Larger deals have longer implementation timelines than historically expected, affecting revenue conversion. - Forecasting risks: Challenges in accurately forecasting revenue due to detailed financial operations improvements still in progress.

Q: Regarding bookings cadence and whether to maintain Q1 pace, Chris Fowler responds that they're optimistic about the pipeline but need to be cautious with larger deals taking longer.

A: Chris Fowler states they're excited about sales team execution and demand from the market.

Q: On cost actions and remaining opportunities, Vinay Bassi says there are still areas like ROI focus on projects and noncritical vendors with some room left, while Chris adds Multiview is an example of cost-saving opportunities.

A: Vinay notes 80%+ rightsizing in OpEx but expects smaller incremental savings; Chris highlights leveraging partners for efficiencies.

Q: On revenue guidance and EBITDA ramp, Vinay explains revenue guidance cut due to delayed bookings to revenue conversion, but EBITDA remains on track due to cost savings and gross margin improvements.

A: Vinay breaks down EBITDA drivers including offshore benefits, gross margin, and working capital management.

Q: On partnership with Nuance and pricing, Chris says they have existing customers using Nuance and will evaluate functionality and pricing for different customer segments.

A: Chris mentions considering optionality for customers with different needs.

Q: On change hack impact and shareholder value, Chris says they saw incremental sales opportunities from the change hack and are focused on execution to drive shareholder value.

A: Chris emphasizes executing on transformation to bear fruit for shareholder value.