Waystar (WAY) Barclays 22nd Annual Global Technology Conference 2024 summary

Business overview and market opportunity

• Operates a cloud-based software platform for healthcare payments, serving over a million providers across all care settings.

• Processes over $5 billion in insurance transactions annually, representing $1.2 trillion in gross claim charges.

• Addresses $750 billion in administrative waste in the $4 trillion U.S. healthcare market.

• Revenue is split roughly 50/50 between subscription and volume-based models, tailored to provider type.

• Patient payment solutions leverage transaction data to improve transparency and collection efficiency.

Financial performance and growth drivers

• Achieved 109.5% net revenue retention in Q3, indicating strong client engagement and upsell.

• Added $12 million incremental revenue in Q3 and $22 million year-to-date from onboarding new clients post-cyber event.

• Delivered 40% EBITDA margins for the second consecutive quarter, ahead of schedule on deleveraging to 3x leverage.

• Growth algorithm includes 3% annual price increases, 1-2% utilization tailwind, and cross-sell/upsell opportunities.

• Targeting low double-digit revenue growth, with a two-year CAGR of 12.5% from 2023 to 2025.

Impact of industry cyber event and market share

• Gained over 30,000 providers after a competitor's cyber attack, with most signing multi-year agreements.

• Incremental revenue from this event is considered durable, not one-time.

• Current phase sees increased RFP activity and long-term market share opportunities as organizations consolidate technology.

• Sales and implementation cycles have normalized post-event, with revenue growth patterns returning to pre-event trends.