AIDX

• Transition and Integration Progress

• One year after the Orion acquisition, Hillwell has completed the difficult phase of its two-year business integration and transition from episodic life science project revenue to recurring enterprise healthcare sales. The company maintains positive adjusted EBITDA throughout the transition, with a strengthened balance sheet and expanded market footprint.
• Internally, AI-generated data output overtook human-generated output for the first time in May 2026, up from 0% one year prior, driving improved efficiency and margin.
• 90% of planned revenue synergies from the Orion integration are complete; only ~one-third of planned cost synergies (reducing tech debt, streamlining corporate functions and R&D) have been completed, with remaining work expected over the next 12-18 months to expand gross margins.

• Platform and Product Progress

• Hillwell's core platform now holds over 150 million longitudinal patient records across 13 clinical domains, serves more than 22,000 healthcare providers, and has 770,000+ engaged clinicians globally. In Q2 2026 alone, the Darwin AI engine identified 62,000+ high-risk patients for early intervention, and now supports screening for 123 rare, chronic, and complex diseases; 1,291 physicians have been onboarded to AI co-pilot tools.
• Four key growth engines have been established from the integrated platform: (1) HIE and clinical data unlock, (2) packaged productized SmartSuite (SmartSearch, SmartSummary, SmartID), (3) global enterprise life science agreements, (4) consented patient data via WellTrust in Canada.
• Commercial deployment milestones: SmartSuite is deployed in North America and sold in the Middle East; a completed real-world evidence study confirmed WADES' effectiveness in identifying undiagnosed/unmanaged diabetes; a multi-province pilot of SmartSuite across Canadian EMR systems was accepted for presentation at the November 2026 AMIA conference. AI products have been successfully cross-sold into the legacy Orion customer base, with the company on track to hit its 2026 target of 10% cross-sell penetration.
• The company holds a CAD 23 million stake in SpaceX (up from CAD 4.6 million carrying value at Q1 2026) subject to a pre-IPO lock-up period.

• Strategic Positioning

• The company's mission is to enable cost-effective population-scale preventative care: it connects fragmented healthcare data into longitudinal records, extracts clinically relevant information from unstructured data with 95% accuracy across 95% of disease states, and enables healthcare systems to implement preventative care as a standard operating model. Management highlights a structural global market shift driven by unsustainable healthcare economics, mandatory prevention regulation, and aligned incentives across payers, providers, and pharma that favors Hillwell's platform.

• Management reaffirms its target of reaching approximately 10% adjusted EBITDA margin by the end of 2026, driven by enterprise revenue growth in H2 2026, cost reduction actions from H1 2026 flowing through to H2, and timing of cost recognition that left H1 2026 costs slightly elevated.
• Full-year 2026 total revenue growth is expected to land at the lower end of the prior 30% to 50% range, due to longer sales cycles for the new enterprise model, which shifted revenue growth for the Data Science & AI segment to the right. The stable core Healthcare Software segment is expected to continue growing at a steady high single-digit annual rate.
• Management expects a growing mix of recurring enterprise revenue, larger AI deal sizes (current enterprise deals range from CAD 1 million to CAD 3 million, up from six-figure episodic pilot deals historically), continued geographic expansion across all core markets, and strong public sector tailwinds for data-driven preventative care.
• 2026 is focused on margin expansion, while 2027 will see a refocus on accelerating revenue growth, driven by the ramp of enterprise healthcare deals.
• The insurance market, a large long-term growth opportunity, is expected to produce its first closed deals no earlier than 2027 due to longer sales cycles.

Hillwell AI reports two core operating segments: Data Science & AI, and Healthcare Software. For Q2 2026, total revenue from continuing operations was CAD 33 million, flat compared to CAD 33.2 million in Q2 2025 (Q2 2025 benefited from elevated episodic project-based activity). Adjusted EBITDA was positive CAD 1.1 million in Q2 2026, down from CAD 2.3 million in Q2 2025, a drop driven by the disposal of the Mutual business in Q4 2025 and lower Q2 2026 life science study volume. Gross profit was CAD 17.9 million (54% gross margin) in Q2 2026, compared to CAD 18.7 million (56% gross margin) in Q2 2025, with the margin decline from a lower-margin revenue mix in the Data Science & AI segment. For H1 2026, total revenue from continuing operations was CAD 66.2 million, a 60% increase from CAD 41.3 million in H1 2025, driven by the full six months of contribution from the Orion Health acquisition (closed April 1 2025, only contributed a partial period in H1 2025). Adjusted EBITDA for H1 2026 was positive CAD 1.9 million, up from CAD 0.1 million in H1 2025, with the increase driven by the Orion acquisition and improved segment performance. Gross profit for H1 2026 was CAD 37.4 million (57% gross margin), a 62% increase from H1 2025. The stable core Healthcare Software segment is expected to continue growing at a high single-digit annual rate in 2026. For full-year 2026, the Data Science & AI segment is expected to grow ~30% year-over-year, reaching ~CAD 13 million in total annual revenue, up from CAD 10 million in 2025, with CAD ~4.6 million in H1 2026 and expected CAD ~8.4 million in H2 2026.

• Enterprise sales cycles are longer than the prior episodic project model, leading to delayed revenue recognition relative to initial expectations, with implementation timelines for new regional enterprise deployments longer than initially projected.
• Customer budget constraints and macroeconomic pressures may delay the timing of RFP release and revenue conversion for new pipeline opportunities.
• The company's SpaceX stake is still subject to a pre-IPO lock-up period, so monetization timing is uncertain and depends on lock-up expiry and market conditions.
• Pursuing multiple concurrent opportunities across geographies and product lines creates execution risk if the company does not allocate resources effectively, and management has intentionally prioritized focused execution over chasing all available opportunities to preserve margin discipline.
• Cross-selling and integration take longer than initially planned, with enterprise cross-sell cycles running 6 to 9 months rather than the 1 to 3 months seen for smaller projects.

Q: Analysts asked for an update on the enterprise pipeline, geographic opportunity, macro budget impacts, 2026 segment revenue growth guidance, and 2027 growth trajectory. / A: Management confirmed the enterprise pipeline is broad across all product lines and all geographies, with high activity in the Middle East, US, Canada, with RFPs expected in Europe, Australia, and New Zealand by end of 2026. Customers now prefer large-scale platform deals over small pilots, with current enterprise deals sized between CAD 1 million and CAD 3 million, up from historic CAD 200k-300k pilot deals. 2026 full-year Data Science & AI growth is expected to land at the lower end of the prior 30-50% range, while the Healthcare Software segment will maintain steady high single-digit growth. Strong enterprise growth is expected to drive overall growth in 2027.

Q: What is the expected path to the 10% full-year adjusted EBITDA margin target, and how is cross-sell into the Orion customer base tracking? / A: Cross-sell penetration is on track to hit the 2026 target of 10% by end of year, with half the target achieved halfway through the year. The 10% margin target will be met via three factors: enterprise sales in healthcare and AI will start contributing in Q3/Q4, shifting segment margin materially; H1 cost reduction actions will flow through to H2 results; and timing of cost recognition leaves H1 costs slightly elevated vs H2.

Q: What is the update on the long-term insurance market opportunity, and what is the current state of Hillwell's balance sheet? / A: In the US, insurance is the primary payer similar to public health in Commonwealth countries, with dual drivers of cost savings and risk mitigation for carriers. Insurance deals are larger but have very long sales cycles, with no deals expected to close in 2026, but management is excited about the large size of this long-term opportunity. The balance sheet is currently stable: short-term net liabilities are ~1x adjusted EBITDA, and long-term convertible debt of ~CAD 30 million has four years remaining. Once the SpaceX stake lock-up expires, liquidation will provide additional strong liquidity for near-term needs, leaving the company well-resourced for 2026 and 2027 plans.

Q: What is the status of sales traction from the completed multi-province SmartSuite pilot, and when will the SpaceX stake be monetized, with proceeds used for debt paydown? / A: The pilot has progressed to a second deployment stage, with additional regional deployments starting in Q3 2026, and meaningful sales traction expected from the product in late 2026 and into 2027. Management expects to receive notification of lock-up expiry within the next month, and will liquidate the position as practical once eligible. Proceeds will be used for working capital within the existing Orion facility; the company does not plan to fully pay off the existing debt facility.

Q: What is the timeline for revenue recognition for new enterprise deals, and what customer need is most exciting to customers across segments? / A: A typical new enterprise deal includes an upfront implementation fee (to set up cloud infrastructure) that takes 3-4 months to complete before revenue recognition, with implementation taking longer than initially expected for first deployments in new regions. After implementation, recurring SaaS fees begin, which are typically 3-4x the size of the implementation fee. For life science customers, clinical data unlock and WellTrust's fast patient recruitment for clinical trials are the top draws; for healthcare system provider customers, SmartSuite's efficiency gains are most exciting; in the US, basic HIE interoperability to create complete longitudinal patient records remains one of the highest-value unmet needs, serving as a foundation for future AI deployment.