Release Date: May 13, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Augmedix Inc reported a 40% increase in revenue for the first quarter of 2024.
- The company achieved a Net Revenue Retention (NRR) of 143%, indicating strong customer retention and account expansion.
- Augmedix Inc launched Augmedix Go and Augmedix Go Assist, expanding its product offerings with AI-powered solutions.
- The company has successfully partnered with major healthcare systems like HCA Healthcare, which is preparing for a wide deployment of Augmedix Go across their emergency departments.
- Augmedix Inc is utilizing the proceeds from its November 2023 capital raise to expand its commercial and technical teams, with about 60% of the hiring plan already completed.
Negative Points
- Augmedix Inc adjusted its full-year revenue outlook downwards due to a slowdown in purchasing commitments for established solutions like Augmedix Live.
- Some large health systems are transitioning from Augmedix Live to the lower-priced Go Assist product, impacting current year revenue expectations.
- The company reported an increase in operating expenses to $12.7 million for the first quarter of 2024, up from the previous quarter.
- Augmedix Inc experienced a net loss from operations, which increased to $6.4 million from $5.1 million in the first quarter of 2023.
- The company's cash flow from operating activities was an outflow of $8.2 million in the first quarter of 2024, compared to an outflow of $6.2 million in the same period last year.
Q & A Highlights
Q: Can you clarify the 85% of the roughly 12% guidance reduction in sales due to Augmedix Live? Is it the movement from Live to Go, or just lower bookings?
A: (Paul Ginocchio, CFO) Yes, 80% of that change is due to both lower bookings and the move from Live to Go Assist. Those two account for the 80%.
Q: How quickly can clients make the conversion from Live to Go Assist?
A: (Paul Ginocchio, CFO) It depends on the contract. For the vast majority of the contracts, they have a 90-day ability to make that migration. We're going to optimize the ROI for the customer long term because we want to keep customers happy and do what's right for them.
Q: What's the remainder of the factors bringing the guidance down, if the major ones are lower bookings and movement from Live to Go Assist?
A: (Paul Ginocchio, CFO) We're also now assuming a faster migration of Notes, which is a more established product, to Go Assist. In that price point, the ARPU is lower, so that's the remaining 20%.
Q: How are you thinking about the cash burn and investments given the headwinds you're seeing?
A: (Emmanuel Krakaris, CEO) We've completed about 60% of the hiring we planned to complete, and we're going to calibrate very carefully with the rest of those potential hires in relation to how the market reacts to our product offering. We're not going to be dogmatic about our previous hiring plan and will make whatever adjustments are necessary as warranted by market conditions.
Q: Can you give us more color on decision delays or the typical length for evaluating Go?
A: (Emmanuel Krakaris, CEO) There's a rush to try AI solutions from a variety of providers. Until those trials run their course, providers will be somewhat reluctant to commit wide-scale to any one particular solution or vendor. We're in a period of trial where vendors are trying to demonstrate their capabilities.
Q: What's the motivation for a clinician to stay with Live versus switching to Augmedix Go Assist, and what's the relative price difference?
A: (Emmanuel Krakaris, CEO) Live delivers the highest quality note possible because it's synchronous and real-time. It also allows clinicians to rely on a medical documentation specialist for ancillary services not available with a pure AI solution. The price differential is substantial; Live is roughly $2,400 per month per doctor, whereas Go Assist ranges from $300 to $600.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
