Waystar (WAY) Q2 2024 earnings summary

Executive summary

• Q2 2024 revenue grew 20% year-over-year to $235 million, driven by strong client retention, new sales, increased patient payment volumes, and rapid onboarding of providers after a competitor's cyber attack.

• Adjusted EBITDA was $94 million, up 12% year-over-year, maintaining a 40% margin, with unlevered free cash flow of $50 million.

• Net loss for Q2 2024 was $27.7 million, impacted by significant stock-based compensation from the IPO.

• Over 30,000 providers were rapidly onboarded following a competitor's cyber incident, with most signing multi-year agreements, strengthening long-term client relationships.

• The company leverages a modern, cloud-based platform with advanced AI and machine learning, serving over one million providers and integrating with 500+ EHR and practice management systems.

Financial highlights

• Q2 2024 revenue was $234.5 million, up 20% year-over-year; subscription revenue grew 13% and volume-based revenue 26%.

• Adjusted EBITDA for Q2 2024 was $93.9 million, with a 40% margin.

• Net loss for Q2 2024 was $27.7 million, compared to $10.8 million in Q2 2023, primarily due to IPO-related stock-based compensation.

• Unlevered free cash flow for Q2 2024 was $50 million.

• Net revenue retention rate was 108% in Q2 2024, with 1,117 clients generating over $100,000 in trailing 12-month revenue, up 9% year-over-year.

Outlook and guidance

• FY 2024 revenue expected between $902 million and $918 million, representing 14–16% growth.

• Adjusted EBITDA guidance: $360 million to $368 million, with a 40% margin.

• Non-GAAP net income projected at $36 million to $42 million, with diluted non-GAAP EPS of $0.23 to $0.27.

• Guidance reflects normalization of implementation timelines, seasonality in patient payments, and lower interest expense due to debt repayments.

• Both subscription and volume-based revenue projected to grow over 10% year-over-year.