Release Date: May 28, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Phreesia Inc (PHR, Financial) reported a 15% year-over-year increase in revenue, reaching $115.9 million for the first quarter of fiscal 2026.
- The company achieved a 16.7% year-over-year increase in adjusted EBITDA, with a margin of 18%.
- Phreesia Inc (PHR) maintained positive operating cash flow and free cash flow for the fourth consecutive quarter, with operating cash flow at $14.9 million.
- The company ended the quarter with $90.9 million in cash and cash equivalents, up from $84.2 million in the prior quarter.
- Phreesia Inc (PHR) is integrating AI across its organization and products, positioning itself for continued growth through product-led strategies.
Negative Points
- The company faces a competitive market environment, particularly in the provider market, which remains challenging.
- There is potential uncertainty in the provider market due to macroeconomic factors, although Phreesia Inc (PHR) has shown resilience.
- The company acknowledges the risk of fluctuations in quarter-to-quarter financial performance due to timing of invoicing and payments.
- Phreesia Inc (PHR) has experienced challenges with past acquisitions, such as the setback with the OnCall acquisition.
- The company is cautious about potential legislative changes, such as the No Handouts for Drug Advertisements Act, which could impact its business model.
Q & A Highlights
Q: Can you discuss the growth in network solutions and any hesitancy from customers in the current environment?
A: Balaji Gandhi, Chief Financial Officer, explained that the growth is a testament to the team and product-led approach. There is no significant change in customer hesitancy, and the company continues to see strong results due to effective product development and delivery.
Q: How have conversations with provider market clients evolved, considering recent macro developments?
A: Balaji Gandhi noted that the focus remains on delivering value through products. The competitive market dynamics have not changed significantly, and Phreesia continues to add new clients and generate revenue from existing ones.
Q: Can you elaborate on the flexibility and visibility network solutions customers have regarding ROI and campaign adjustments?
A: Chaim Indig, Chief Executive Officer, stated that campaigns undergo a medical legal review process, allowing flexibility to adjust based on client needs. Phreesia's strong ROI and scale often lead to increased client investment throughout the year.
Q: Are there any potential capital deployments that might be considered now due to an improved financial position?
A: Balaji Gandhi mentioned that while the company evaluates opportunities through a buy, build, or rent lens, the approach to capital deployment remains unchanged. The focus is on strategic opportunities that align with long-term goals.
Q: How is AI impacting Phreesia's products and competitive landscape?
A: Chaim Indig highlighted that AI enables new capabilities in products and operations. While AI itself is not sold, it enhances solutions to complex problems, strengthening Phreesia's position as a trusted partner in the market.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
