Q2 2023 Healthequity Inc Earnings Call

September 6, 2022

In quarter, fiscal year 2023 earnings conference call. My name is Richard Putnam. I do invest relations here for health equity. I do invest relations here for health equity.

Joining me today, we have John Kessler, who's our President and CEO , Dr. Steve Nieleman, who's our Vice Chair and Founder of the company, and Tyson Murdock, the company's Executive Vice President and CFO .

Before I turn the call over to John , I have two important reminders. First, a press release announcing our financial results for the second quarter of fiscal year 2023 was issued after the market closed this afternoon.

The financial results in the press release include contributions from our wholly-owned subsidiary Wage Works and the Accounts Edid Ministers.

The press release also includes definitions of certain non- GAAP financial measures that we will reference here today. A copy of today's press release including the reconciliation of those non- GAAP measures with comparable GAAP measures and a recording of this webcast can be found on our Investor Relations website, which is ir.healthequity.com.

Second, our comments and responses to your questions today reflect management view as of today, September 6, 2022.

and will contain forward-looking statements as defined by the SEC, including predictions, expectations, estimates, or other information that might be considered forward-looking.

There are many important factors relating to our business, which could affect the forward-looking statements made today.

These forward-looking statements are subject to risk and uncertainties that may cause the actual results to different materially from statements made here today. We caution you against placing undue reliance on these forward-looking statements and we also encourage you...

to review the discussion of these factors, as well as other risk factors that may affect our future results or the market price of our stock, and they are detailed in our latest annual report on Form 10-K and subsequent periodic reports filed with the FCC.

We assume no obligation to revise or update these forward-looking statements in light of new information or future events.

And at the conclusion of our prepared remarks, we will open up the call for Q&A with the help of our operator.

So let's get started by turning this over to our CEO John Kessler. Thank you Richard and thanks everyone for joining us this afternoon. Today we are announcing solid results for Health Equity's fiscal 2023 second quarter on the back of strong performance in our core HSA business. And we're also raising our full year outlook. I will discuss Q2 operating results and Tyson will review the financial results in detail and provide updated guidance. And then Steve is here for Q&A.

Let's start with the five key metrics that drive our business. As always, revenue of $206.1 million grew 9% versus the second quarter last year, driven by strong organic and acquisitive growth in HSA members and assets. And that was notwithstanding non-recurring regulatory drivers of CDB service fees in the year-ago period. Excluding these non-recurring factors, revenue grew 15% year-over-year.

Adjusted EBITDA of 67.0 million grew 2% versus the second quarter of last year, weighed down by the absence of those regulatory drivers and the timing of synergies from the further acquisition. Total accounts grew to 14.5 million up 11% compared to Q2 last year. HSA members reached 7.5 million up 26% year over year. And health equities HSA members grew their assets to a record 20.5 billion at quarter's end.

which is up an even larger 33% from a year ago.

Team Purple continued its strong FY23 sales effort, adding 196,000 HSAs, which is 9% more than we added in the second quarter of last year.

Organic account growth of 12% over the past year is, we believe, well ahead of the market. Looking forward to year-end, we are particularly excited about pipeline growth from network partners, conversion of enterprise cross-sell opportunities, and enterprise uptake of MaxEnroll, which is our package of virtual education and live support for clients, employees, considering stepping up to an HSA-qualified health plan and an HSA during this open enrollment season.

Despite volatile market conditions, HSA invested assets grew $111 million in a quarter. HSA investing members grew 28% and the average balance of our HSA members overall grew 5% year over year.

Custodial revenue growth was very strong. On top of the small favorable impact of in-quarter increases in the overnight Fed funds rate, robust adoption by HSA members of Health Equity's enhanced rates offering in Q2 puts us on track to meet or exceed our target of having 20% of HSA cash in enhanced rates by the end of the fiscal year. Both macro conditions and the team's efforts are, we believe, creating the opportunity for years of custodial growth.

resurgence, crimping member spend beyond the usual seasonality that we see in Q3.

Today's results and the guidance Tyson will detail in a moment would be even stronger, but for softness in CDB administration services.

As you know, health equity offers CDB services to increase core HSA opportunities, and indeed, cross-selling and bundled selling have helped drive record HSA sales, as I discussed a moment ago. However,

Service fees from CDBs themselves declined through the first half of fiscal 23 versus the same period in fiscal 22, primarily due to one-time COBRA subsidy-driven income in the year-ago period and greater than expected, and greater than expected, and greater than expected.

CDB fee attrition from the now completed wage works platform migration.

Service costs decline sequentially in Q2 as promised, and we believe there is more opportunity inefficiencies, as well as commuters' slow but steady recovery.

As pandemic and wage works integration impacts finally receive, we believe that CDBs can bring net unit growth and a larger contribution to growth profits alongside the great things that are happening in the HSA core.

With that, I will turn it over to Tyson to review the financial details and give us some guidance.

Thank you, John . I'll review our second quarter gap and non- GAAP financial results, a reconciliation of GAAP measures to non- GAAP measures as found in today's press release.

Second quarter revenue increased 9% year over year with lower service revenue more than offset by robust custodial and interchange growth.

Service revenue was $103 million, down 6.1 million or 6% year over year.

Last year's second quarter included approximately $10 million of non-recurring revenue attributed to the COBRA subsidy.

Excluding the non-recurring subsidy impact, Q2 service revenue grew approximately 4%, primarily from strong HSA growth and an uptick in commuters returning to work, offsetting about $5 million of FSA and COBRA revenue that John mentioned.

Custodial revenue grew 34% to $65.6 million in the second quarter, benefiting from 30% growth in average HSA cash and 37% growth in average HSA investments, combined with an uptick in the annualized yield on HSA cash.

The annualized interest rate yield on HSA cash was 180 basis points during the second quarter of this year, and 175 basis points year-to-date compared to 177 and 178 respectively for last year. This yield is a blended rate for all HSA cash during the quarter and represents a better-than-expected yield due to rate hikes in June and July , impacting the variable rate portion of our HSA cash combined with higher enhanced rate balances in the quarter.

Interchange revenue grew 20% to $37.5 million compared to $31.1 million in the same quarter last year.

As John mentioned, Interchange revenue in the year-ago period benefited from accelerated spend as FSA rollover extensions expired. Year-over-year growth in Q2 benefited from growth in average total accounts with CARDS and increased spend per account.

Gross profit was $117.8 million compared to $112 million in the second quarter of last year. Gross margin was 57% in the second quarter this year versus 59% in the year-ago period.

and service costs decreased fixed and service costs decreased fixed million sequentially as we executed our commitment to address our Overstaffing and member services as we as we discussed with you approximately 90 days ago

However, we have work to do to bring our expectations of service costs in line with revenue in future periods. This includes realizing additional efficiency from the integration work and managing the impact of inflation on service costs. In addition, we are committed to delivering the $15 million of synergies connected to the further integration, the bulk of which is associated with the exit of the transition services agreement and the consolidation of the platform expected to be realized in fiscal 2024 and 2025.

Operating expenses were $120.2 million or 58% of revenue, including amortization of acquired intangible assets and merger integration expenses, which together represented 15% of revenue.

Loss from operations was $2.4 million. Net loss for the second quarter was $10.7 million or a loss of 13 cents per share on a GAAP EPS basis compared to a net loss of $3.8 million or $0.05 per share in the prior year. Our non-GAAP net income was $28.1 million for the second quarter this year compared to $33.4 million a year ago.

non-GAAP net income per share was 33 cents per share compared to 40 cents per share last year.

Adjusted EBITDA for the quarter was $67 million and adjusted EBITDA margin was 33%.

For the first six months of fiscal 23, revenue was $411.8 million, up 10 percent compared to the first six months of last year. Gatt net loss was $24.3 million, or $0.29 per share, diluted share. Time gap net income was $50.8 million, or $0.60 per diluted share.

And adjusted EBITDA was $125.4 million, up 1% from the prior year, resulting in 30% adjusted EBITDA margin for the first half of this fiscal year. B Wrap Up

Turning to the balance sheet, as of July 31, 2022, we had $177 million of cash and cash equivalents with $928 million of debt outstanding net of issuance costs. This includes $346 million of variable rate debt.

There are no outstanding amounts drawn on our $1 billion line of credit.

We are providing the following revision to our guidance for fiscal 23.

We are increasing our revenue estimates for fiscal 23 to range between $834 and $844 million. We are maintaining non-GAAP net income to be between $103 and $111 million, reflecting increased interest expense, offsetting the benefit of higher operating income.

This results in non-GAAP-deluded net income between $1.23 and $1.32 per share based upon an estimated 84 million shares outstanding for the year. We are raising our adjusted EVA estimate to be between $252 and $262 million.

Today's guidance includes our most recent estimate of service, custodial and interchange revenue and expense based on results today. On service revenue, today's guidance reflects the continued solid performance of core HSA offsetting the full year impact of the roughly $5 million per quarter of CDB service theatrician observed in the first half. We remain cautious on increased commuter uptake. Based on the strong sales outlook John discussed and continued labor market tightness, today's guidance assumes incremental service costs during peak season comparable to the previous

much greater impact on fiscal 24 and beyond as we roll over fixed rate contracts and place new HSA cash from growth at the end of the fiscal year. In the same vein, today's guidance reflects additional interest expense on health equity's variable rate debt for the second half of fiscal 2023 based on current conditions but not further rate hikes.

On interchange, we want to remind you that Q3 has historically been our weakest interchange revenue quarter. We expect the normal sequential decline in spend in Q3 with a rebound in Q4 due to use or lose spending and January growth. Finally, we assume a projected statutory income tax rate of approximately 25% and a diluted share count of $84 million in our calculation of non-GAAP net income and earnings per share. As we've done in recent reporting periods, our full year guidance includes a detailed reconciliation of GAAP to the non-GAAP metrics provided in the earnings release.

and a definition of all such items is included at the end of the earnings release. In addition, while the amortization of acquired intangibles is being excluded from non-GAAP net income, the revenue generated from those acquired intangible assets is not excluded. With that, I'll turn the call back over to John for some closing remarks. You should have a button that just says that. It's like a little recorded button.

Anyway, so before we go to Q&A, I'd like to just take a second on behalf of Team Purple to thank Ted Bloomberg, who is our former COO. We truly appreciate, I truly appreciate everything that Ted has done in furtherance of our mission to connect health and wealth.

through the WaveWorks integration.

the pandemic, the acquisition of further launch of enhanced rates, and other milestones. We all truly wish Ted the best.

The team and our partners and clients are all now focused on delivering a deep purple open enrollment and onboarding season. Hopefully that will not get me in copyright trouble. I've said before that present sales are the best predictor of future sales. And on that basis, given what I've said today and what we're reporting today, we expect a very busy and productive rest of the fiscal year.

Thank you. Operator? Thank you. As a reminder, to ask a question, you will need to press star 1 1 on your telephone. Please stand by while we compile the Q&A roster.

Our first question comes from C. Gregory Peters with Raymond James. You may proceed.

Mr. Peters.

If your phone is on mute, please unmute.

doesn't have a mute button. That's not how we roll.

Why don't we go to the next one? We'll come back. Can you hear me? Can you hear me? Can you hear me? Yeah.

growers Erik Mike, come and have it.

All right, sorry about that. I guess my AirPods weren't working. So I guess let's start off with the sales results. And I'm just trying to unpack.

the strong new HSA number that you reported for the second quarter and trying to figure out the components of what are existing customers, just new employees, new accounts coming on board, just trying to break apart what you liked it up, I would think better than expected result there.

the strong new HSA number that you reported for the second quarter and trying to figure out the components of what are existing customers, new employees, new accounts coming on board, just trying to break apart what you liked, I would think, better than expected result there. Yeah, that's a great question. Thank you, Greg.

So, just kind of for sake of summary, if I look at the first half of the year as a whole, we've added 355,000 accounts.

are open 355,000 accounts and account closures have been very much under control. And that 355K is 20 percent plus relative to last year which itself was was obviously the best we've ever had for the first half. You've been with us kind of from the beginning here and you know you remember when we would report 400K for a year and be pretty happy about it. So reporting this kind of number for the first half feels pretty good. and

to your question, if I look at the components of that and try and break it down, as we said at the end of the first quarter, the fact that the labor market has remained strong is definitely a factor.

Hello?

One moment please.

Something happened very far.

Please remain on the line, your conference will resume shortly.

Please remain on the line. Your conference will resume shortly.

Thank you.

The two courarter year 20 20, three conference COUR year pres the comp and the comp ex Ed the call two T re an results for the second courart fiscal year twent 20, three the the mar COUR Act results results the P? Re COUR and the count P includ ions as that referen year. The re? ation of on GAAP meas compared AP me recourting of C reation conment pon courion six twent 20 and court statement five the C inclcour iction caseation imment ation COUR court Act ated bus the COUR statements statements thir COUR the results statement COUR COUR nine on four statement COUR revie the discuss of the Act the Act that results or ice and repcour COUR COUR ation rev four statements ation and the clud Ion of mar Ed the re after N results qu FIs twent 20, three second courarter the Act str for court and also our year discuss two per results Ty revie the financial results and pro D guid and C year four the five TR bus revenue two hundred six point million, 9%. The second courart last year strong COUR COUR members as stand recour re atory ERS C D B service the year cluding non recour fact revenue teen percent year over just 60, seven point illion COUR 2%. The second courarter last year by the re ator the UN, the urther acquation coun COUR courteen point five million. The Le percent ared two last year members point five million 20, 6% year over year and qu? A members record 20 point five illion courtter 30%, eight year COUR str 20 three's hundred nin 6, nine cent Ed second courarter last year count courth percent over the P year. Believe the mar COUR year exced courth courparters COUR Ion COUR se oortun and pri Act ation and court C Lo a COUR five and a ment mar condions a hundred Le million llars courarter V members 20, 8% and the members over 5% year over year revenue of the state or Act courart incre the over F bust option members he qu? Er two COUR TR C courar 20%, eight C the of the fiscal year condions and the believe the opportun for thir th bust COUR infl in the CON COUR consuion other COUR services Su: ERS two recour COUR in the year Tim P tend offs's a and court one per ation re members the that C results and the GU strong C min isation services qu C B services increase court opportun seing ING record. Ils discuss M service C the first F Cal 20, three vers the F twent two re in in the year and expected C Ion the COUR four ation service COUR two and believe opportun Ion commut COUR and ation Act. Believe that C D B th and con Ion courth the COUR in the state COUR over two the revie the financial IL second courart AP non AP results re IL ation AP non GA rease court revenue increase 9% year over year. Er service revenue 30 change COUR service reven the three million, six point one million or six cent year over year. Second court included prox million non reven to the COUR excluding the on sub Act two service revenue prox 4%. priim strong UT COUR five million revenue trion Ion thir revenue COUR 30 4% 60, five point six million in the second court 30% courth state C 30, 7% ment bed the C nine state C one hundred eighty bas COUR the second courarter of this year one hundred se Y five bas COUR year compared two one hundred sevenventty 7, one hundred se eight Ed four last year the ED state C the courar re expected Act the courtion of state C BAL in the court inter revenue 20% 30, seven point five million compared Ty one onemillion courarter last year. Ion inter revenue in the year en over six over year th two en th to counts cours and incre coun properit one hundred seven teen point eight million ared to one hundred million the the second courarter last year marg fifty seven cent secondcourt year vers fifty nine cent service courst crease six service courst CRE six mion COUR. Cute address over services discus pro IM nine Ty ations service St line revenue UT included ition ation Act ation on service co addition M Ed Li teen million Ed to the Fur ation the the the Ion servicees theagion and the llation of the four expected fiscal 20 4, 20 en were one hundred 20 point twomillion or fifty 8% venue uding ation of ationion sent re teen cent revenue last perationions two point four mill. Los the second courarter point seven million St 13 sent per AP bas compared to Lo three point eight million or five sent per the prior year. non-GAAP 20 point one million for the second courarter year compared 30, three point four million year on GAAP year 30, three sent per year compared 40 sent per last year just the courter 60, seven million and mar 30, 3% the six Mon of fiscal 20, three revenue COUR seven point eight million percent comp the six Mon last year Los 20, four point three million or 20, nine sent per year on GAAP fifty point eight million or 60 sent year and justed one hundred 20 point four million 1% for or resul 30% justed marg for the fiscal year two the ll 30, two thousand 20, one hundred re seven illion C C COUR nine hundred 20 million stand COUR included 30 illion oun on illion ll COUR reviding Ion guidance fiscal 20, three CRE our revenue estim fiscal 20 3, eight hundred 30 4, eight hundred 30, four million dollars non-GAAP between one hundred 3, one million dollars REF Ed increase six sent en the results non AP between one llars 20 3, ll 30, two per based estim four million year for year RA just estim Ty two hundred 60 million dollars includ re estim service 30 change revenue and sent Ed results service revenue guid F the four Act five million courar service Ion the first re COUR increase Ed on str ll cus mar guidance teen service co compared those prior 30 revenue guidance year C hundred, eight hundred bas COUR COUR two strong second based courrent condions the guidance increases the over other change CLO re the fiscal year the addition Ion Act year Act fiscal 20, four over six contract COUR C the the fiscal year the state guid F addition six sent Ty the second iscal 20 Ed on court condions inter 1, nine change revenue courarter expected or COUR the 3, the two 4, two or pro twent 5% uded count 8, four million ation of N GAAP per re rerepcour guidance uded ill AP the non-GAAP provided the de Ion of uded the rease. Add the hundred ation excluded on GAAP 9, the revenue, the CLO mar the COUR before we like on Form further mion the ation, the and the acquision Fur UN and the, the and courparters and C on Li and on courty not COUR that the bas and report expect and the fiscal year per P 1, one Ed COUR COUR C re re the ase have not Form COUR COUR the resu and str repcour COUR the second courarter and the court ex COUR MERS COUR COUR COUR, COUR the the COUR expected resu year COUR COUR at the first the year five thousand counts thousand coun and count CLO hundred and fif twent percent last year obviously from the year and memb repcour hundred year reporting for the first and ion look at the component that and said courarter the fact the mar re str one COUR ase re the year conference resu COUR ase re on the line year conference resu COUR.

The two courarter year 20 20, three conference COUR year C pres the comp and the comp ex Ed the call two T an results for the second courart fiscal year twent 20, three the the mar COUR Act results results the P re COUR and the count P includ ions as that referen year the re? ation of on GAAP me compared AP me recourting of C reation conment pon courion six twent 20 and court statement five the C inclcour iction caseation IM ation COUR court Act ated bus the COUR statements statements thir COUR the results statement COUR COUR nine on four statement COUR revie the discuss of the Act the Act that results or ice repcour COUR COUR six ation rev four statements ation and the clud Ion of mar Ed the re after N results qu FIs twent 20, three second courarter the Act str for court and also our year discuss two per results Ty revie the financial results and D guid and C year four the five bus revenue two hundred six point million, 9%. The second courart last year strong COUR COUR members as stand recour re atory ERS C D B service the year cluding nine on recour fact revenue teen percent year over just 60, seven point illion COUR 2%. The second courarter last year by the re ator the UN, the urther acquation coun COUR courteen point five million the Le percent ared two last year members point five million 20, 6% year over year and qu a members record 20 point five illion courtter 30%, eight year COUR str 20 three's hundred nin 6, nine cent Ed second courarter last year count courth percent over the P year. Believe the mar COUR year exced courth courparters COUR Ion COUR se oortun and pri Act ation and court C Lo a COUR five and a ment mar condions a hundred Le million llars courarter V members 20, 8% and the members over 5% year over year. Revenue of the state or Act courart incre the over F bust option members he qu? Er two COUR TR C courar 20%, eight the of the fiscal year condions and the believe the opportun for thir th bust COUR infl in the CON COUR consuion other services suers two recour COUR in the year Tim P tend offs's a and court one per ation re members the that C results and the GU strong C min isation services qu C B services increase court opportun seing ING record. Ils discuss M service C the first F Cal 20, three vers the F twent two re in in the year and expected C Ion the COUR four ation service COUR two and believe opportun Ion commut COUR and ation Act. Believe that C D B th and con Ion courth the COUR in the state COUR over two the revie the financial IL re second courart AP non AP results re IL .ation AP non GA rease courar revenue increase 9% year over year. Er service revenue 30 change COUR service reven the three million six point one million or six cent year over year second court included prox million non reven to the COUR excluding the on sub Act two service revenue prox 4%. priim strong UT thir COUR five million revenue trion Ion thir revenue 30 4% 60, five point six million in the second court 30% th state C 30, 7% bed the C nine state C one hundred eighty bas COUR the second courarter of this year one hundred se Y five bas COUR year compared two one hundred sevenventty 7, one hundred se eight Ed four last year the ED state C the courar re expected Act the courtion of state C the court inter revenue 20% 30, seven point five million compared Ty one onemillion courarter last year. Ion inter revenue in the year en over six over year th two en th to counts cours and incre coun properit one hundred seven teen point eight million ared to one hundred million. The the second courarter last year. Marg fifty seven cent secondcourt year vers fifty nine cent service courst crease six service courst CRE six mion COUR cute address over services discus pro IM nine Ty ations service St line revenue UT included ition ation Act ation on service co addition M Ed Li teen million Ed to the Fur ation the the the Ion servicees theagion and the llation of the four expected fiscal 20 4, 20 en were one hundred 20 point twomillion or fifty 8% venue uding ation of ationion sent re teen cent revenue. Last perationions: two point four mill. Los the second courarter point million St 13 sent per AP bas compared to Lo three point eight million or five sent per prior year. non-GAAP 20 point one million for the second courarter year, compared 30, three point four million year on GAAP. 30, three sent per year compared 40 sent per last year just the courter 60, seven million and mar 30, 3% the six Mon of fiscal 20, three revenue COUR seven point eight million percent comp the six Mon last year Los 20, four point three million or 20, nine sent per year on GAAP. fifty point eight million or 60 sent year and justed one hundred 20 point four million 1% for or resul 30% justed marg for the fiscal year two the .ll 30, two thousand 20, one hundred re seven illion C C COUR nine hundred 20 million stand COUR included 30 illion oun on illion ll COUR reviding Ion guidance fiscal 20, three CRE our revenue IM fiscal 20 3, eight hundred 30 4, eight hundred 30, four million dollars non-GAAP one hundred 3, one million dollars REF Ed increase six sent en the results non AP between one llars 20 3, ll 30, two per based estim four million year for year RA just estim Ty two hundred 60 million dollars includ re estim service 30 change revenue and sent Ed results service revenue guid F the four Act five million courar service Ion the first re courut increase Ed on str ll cus mar guidance teen service co compared those prior 30 revenue guidance year C hundred, eight hundred bas COUR COUR two strong second based courren condions the guidance increases the over hundred change CLO re the fiscal year the addition Ion Act year Act fiscal 20, four over six contract COUR C the the fiscal year the state guid F addition six sent Ty the second iscal 20 Ed on rent condions inter 1, nine change revenue courarter expected or COUR the 3, the two 4, two or COUR pro twent 5% uted count 8, four million ation of N GAAP per re rerepcour guidance UD ill AP the non-GAAP provided the de Ion of uded the re. ase, add the hundred ation excluded on GAAP 9, the revenue, the CLO mar the COUR before we like on Form further mion the ation, the and the acquision Fur UN and the, the and courparters and C on Li and on courty not COUR that the bas report expect and the fiscal per P 1, one Ed COUR COUR C re re the ase have not Form COUR, COUR the resu and str repcour COUR the second courarter and the court ex COUR MERS COUR COUR COUR, COUR the the COUR expected resu year COUR COUR at the first the year five thousand counts thousand coun and count CLO hundred and fif twent percent last year obviously from the year and memb repcour hundred year reporting for the first and ion look at the component that and said courarter the fact the mar re str one COUR ase re the year conference resu COUR ase re on the line year conference resu COUR.

The con courarter year 20 20, three conference COUR year C the comp and the comp ex the call two COUR re results for the second court year twent 20, three the the mar COUR the results results the P? Re con COUR and the count P re includ ions meas that referen year the ation on GAAP me compared AP as recourting of C reations conment on courion six twent 20 and court statement five by the C included iction caseation estim ation COUR court Act the COUR statements statementments thir COUR the results statement COUR COUR nine on four statements COUR revie the discussion of the Act the results or repcourt four COUR five ation rev COUR statements ation and the clud of mar COUR Ed the re? Ing after N results qu iscal 20 20, three second courarter on the str for court and also our year discuss two per results revie the financial results and guid and C year four the five bus revenue two hundred six point million, 9%. The court last year by strong COUR courth eight bers that not stand recour atory ERS C B service the year uding non recour fact revenue teen percent year over year just 67 COUR illion COUR 2%. The second courarter last year by the of re ulator ERS the timing the urther quation coun COUR courteen point five million the Le percent compared two last year members point five million 20, 6% year over year and qu? A members record 20 point five illion courarter 30 cent eight year COUR str 20 three's hundred ninein 6, nine cent Ed the second court last year coun courth percent over the year. Believe the mar COUR year ULAR exced COUR COUR parters COUR Ion COUR se oortunities and pri? uation and court C Lo a COUR five a llment mar condions a V hundred Le million llars courarter vest members 20, 8% and the members over 5% year over year revenue th of the state Act court incre the over F bust option members he qu? Er two COUR TR COUR C courar 20% 8, the of the fiscal year condions and believe the opportun for th two bust COUR th inflation in the COUR con COUR consupt of other services suers two recour COUR in the the Tim pand IC offs's a and court one ination COUR members the C results and the GU strong C min isation servic qu C B services increase court opportun seing ING record. Ils discuss M service C the first fiscal 20, three vers the FIs twent IM two re in in the year and expected C the COUR four ation service COUR C COUR two and believe opportun Ion Comm UT COUR and ation Act C. believe that C B th and contr Ion courth pro the in the eight state COUR over Ty two the revie the financial IL re second court non-GAAP results re AP as non GA re courtter revenue increase 9% year over year ER service revenue 30 change service reven the hundred three million six point one million or six cent year over year court included prox million non reven to the COUR excluding on Act two service revenue pro 4% IM strong UT 20 COUR five million venue Ion Ion reven 30 4% 60, five point six million in the second courart 30% state C 30, 7% vment bed the C nine C one hundred eighty bas COUR the second courarter of year one hundred se Y five bas COUR year compared to 2, one hundred sevenventty 7, one hundred se eight Ed four last year the ED state C the courarter represent expected Act the courtion of state C in the court inter revenue 20% 30, seven point five million compared 30, one point million courarter last year Ion inter revenue in the year benef over over year th two enef counts cours and incre sent coun it one hundred seven point eight million compared to one hundred million. The second courarter last year marg 50, seven cent second courar the year 50, nine cent year service courst crease six service courst CRE six mion COUR cute address over services discussed pro nine Y ations service St line reue UT included ition Ion ation COUR Act ation on service co addition M Ed two Li, 15 million Ed to the Fur .ation the the Ion servicees theagion and the llation of the four expected fiscal 20 4, 20 en were one hundred 20 point twomillion or 50, 8% ven uding ation of ation sent represent teen cent reven peration two point mill lost for the second courarter point seven million 13 sent per AP bas compared to Lo 3, eight million or five sent per prior year. non-GAAP 20, eight point one million. The second courarter compared 30, three point four million year on GAAP per year 30, three sent per year compared 40 sent per last year just the courar 67 million justed mar 30, 3%. The six Mon fiscal 20, three revenue COUR point eight million percent comp to six last year lost 20, four pointy three million or 20, nine sent per year on GAAP 50 point eight million or 60 sent year and justed one hundred 20, four million 1% or resul 30% just marg for the fiscal year the ll 30, two thousand 20, one hundred re seven million C C COUR nine hundred 20, eightmillion stand COUR included 40 illion on or million ll COUR repviding the re Ion guidance fiscal 20, three CRE ING reue estim fiscal 20 3, eight hundred 30 4, eight hundred 30, four million dollars on GAAP between hundred three 1, Le million dollars REF increase six sent Ben the results N GAAP between one ll 20, three doll 30, two per based estimed four million year RA just estim 50, two hundred 60 million dollars includ re estim service 30 revenue sent based results service revenue guance F four Act five million courarter service Ion the re courut crease Ed on the str ll cuss mar guidance service co thir compared those prior 30 revenue guidance year C hundred hundred eight bas COUR COUR two strong second Ed courren condions the guidance increases the over other change ll re the fiscal year addition Ion Act year Act fiscal 20, four over six contract COUR C the of the fiscal year the state guid ition six sent he Ty the second iscal 20 Ed on COUR condions inter 1, nine change revenue courarter expected or 3, the two 4, two or pro twent 5% Ed count 8, four million ation nine GAAP per rerepcouring four guidance includ ill AP the non AP provided the de Ion ance uded the of addition Ion hundred ation excluded on GAAP the revenue the the CLO mar court before we like take second on Form further M the ation, the and the acquision Fur and the, the and courparters and C on Li llment and on courty, not COUR that the courred bas said what reportty expect of the fiscal year per M P 1, one comp COUR COUR C the ase have Form COUR, COUR COUR off the resu and str repcour COUR the second courarter and the court ex COUR ERS COUR COUR COUR, COUR the COUR. The COUR expected resu year COUR COUR at the first the year 50, five thousand counts thousand coun and count CLO hundred and 50, 20% re last year. Obviously the for the from the year and B we report four hundred year reporting for the first and questionion. Look at the component that and said first courarter the fact mar re str 1: COUR ase re on the year ference re COUR ase re on the line year ference re COUR.

Q2 2023 Healthequity Inc Earnings Call

Request a DemoDemo

HQY

HealthEquity

Earnings