Release Date: November 12, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Healwell AI Inc (HWAIF, Financial) achieved record revenue and gross profit in Q3 2024, driven by the commercialization of AI and data science solutions and recent acquisitions.
- The company has more than doubled the number of signed master service agreements with life sciences companies, highlighting its growing recognition in the healthcare ecosystem.
- Healwell AI Inc (HWAIF) has completed four rounds of financing, raising nearly CAD 50 million, which has strengthened its foundation and fueled growth.
- The company has strategically expanded its reach through four acquisitions and multiple minority investments, enhancing its capabilities in early disease detection.
- Healwell AI Inc (HWAIF) is on track to achieve a $100 million annualized revenue run rate and expects to reach profitability on an adjusted EBITDA basis next year.
Negative Points
- Healwell AI Inc (HWAIF) reported an adjusted EBITDA loss of $3.4 million in Q3 2024, compared to a loss of $2.5 million in Q3 2023.
- The company experienced a net loss of $11.1 million in Q3 2024, up from a loss of $7.7 million in the same quarter last year.
- Cash declined to $15.2 million from $19.8 million at the end of Q2, largely due to acquisitions, although some acquisition-related payables are expected to be settled in equity.
- The company faces volatility in the pharmaceutical industry due to the Inflation Reduction Act, impacting its clinical research revenue expectations.
- Healwell AI Inc (HWAIF) anticipates some of its clinical trials being pushed to 2025, affecting short-term revenue projections.
Q & A Highlights
Q: How do you think about the average time in the evaluation phase for your AI technologies, and what are the KPIs for adoption?
A: The evaluation phase can take from one to two months, focusing on compliance and feasibility. KPIs include demonstrating value through automation and modernization, such as replacing manual chart reviews with AI solutions, which can save significant time and effort. (Alex Dobranowski, CEO)
Q: Can you provide insight into the $5.5 million acquisition of a private technology company?
A: The acquisition adds AI capabilities that we previously lacked, enhancing our overall offering. This acquisition strengthens our AI toolset and is expected to contribute to our growth. (Alex Dobranowski, CEO)
Q: How do you view the organic growth potential of your current businesses and further penetration within the MSAs?
A: We expect our healthcare software business to grow 30-40% year-over-year, AI and data science by 50-60%, and clinical research and patient services by 20-30%. We are focused on expanding within existing MSAs to drive further growth. (Anthony Lam, CFO)
Q: Are you on track to achieve adjusted EBITDA profitability in 2025, and how do you see Q4 results?
A: We are confident in reaching a $100 million revenue run rate and achieving adjusted EBITDA profitability next year. We expect Q4 revenue to be incrementally higher than Q3, despite some industry headwinds. (Alex Dobranowski, CEO)
Q: Can you elaborate on plans to expand into later-stage clinical trials at Well's Clinic locations?
A: We are integrating Biopharma with our late-phase trial CRO, CPO, to offer a full spectrum of contract research services. This multiyear effort aims to capitalize on the large opportunity presented by Well Health's clinical footprint. (Alex Dobranowski, CEO)
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
