Q2 2024 CareCloud Inc Earnings Call

August 13, 2024

Stephen Snyder, Nathalie Garcia, Norman Roth, David Larsen, Nathalie Garcia, Norman Roth,

Operator: Ladies and gentlemen, welcome to the CareCloud second quarter 2024 results conference call. At this time, all participants are in a listen-no-near mode. A brief question-and-answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star and zero on your telephone keypad. As a reminder, this conference has been recorded.

Operator: Ladies and gentlemen, welcome to the CareCloud second quarter 2024 results conference call. At this time, all participants are in a listen-only mode. A brief question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star and zero on the telephone keypad. As a reminder, this conference is being recorded. I will now turn the call over to Christian. Thank you. You may begin. Good morning, everyone.

Operator: Ladies and gentlemen, welcome to the CareCloud second quarter 2024 results conference call. At this time, all participants are in a listen-only mode.

In the next episode, we'll see you in the next episode!

Speaker Change: Ladies and gentlemen, welcome to the Care Cloud second quarter 2024 results conference call. At this time, all participants are in a listen-only mode. A brief question and answer session will follow the formal presentation.

Operator: A brief question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star and zero on the telephone keypad. As a reminder, this conference is being recorded. I will now turn the call over to Christian.

Speaker Change: If anyone should require operator assistance during the conference, please press star and zero on a telephone keypad.

Operator: I will now turn the call over to Kristen. Thank you. You may begin.

Operator: Thank you. You may begin. Good morning, everyone.

Speaker Change: As a reminder, this conference has been recorded.

Speaker Change: I will now turn the call over to Christian. Thank you. You may begin.

Kristen: Good morning, everyone. Welcome to CareCloud second quarter, 2024 conference call. On today's call, our Mahmud Haq, our founder and executive chairman; Hadi Chatterji, our chief executive officer and director; Stephen Schneider, our president; and Norman Roth, our interim chief financial officer and controller.

Christian: Welcome to CareCloud's second quarter 2024 conference call. On today's call are Mahmud Haq, our Founder and Executive Chairman, Hadi Chaudhry, our Chief Executive Officer and Director, Stephen Snyder, our President, and Norman Roth, our Interim Chief Financial Officer and Controller. Before we begin, I would like to remind you that certain statements made during this conference call are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended by Section 21E of the Securities Exchange Act of 1934, as amended.

Christian: Good morning, everyone. Welcome to CareCloud's second quarter 2024 conference call. On today's call are Mahmud Haq, our Founder and Executive Chairman, Hadi Chaudhry, our Chief Executive Officer and Director, Stephen Snyder, our President, and Norman Roth, our Interim Chief Financial Officer and Controller. Before we begin, I would like to remind you that certain statements made during this conference call are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended by Section 21E of the Securities Exchange Act of 1934, as amended.

Speaker Change: Good morning, everyone. Welcome to CareCloud's second quarter 2024 conference call. On today's call are Mahmud Haq, our Founder and Executive Chairman,

Speaker Change: Hadi Chaudhry, our Chief Executive Officer and Director, Stephen Snyder, our President, and Norman Roth, our Interim Chief Financial Officer and Controller.

Christian: All statements, other than statements of historical fact, made during this conference are forward-looking statements, including, without limitation, statements regarding our expectations and guidance for future financial and operational performance, expected growth, business outlook, and potential organic growth and acquisition. Forward-looking statements may sometimes be identified with words such as will, may, expect, plan, anticipate, upcoming, believe, estimate, or similar terminology and the negative of these terms. Forward-looking statements are not promises or guarantees of future performance and are subject to a variety of risks and uncertainties, many of which are beyond our control, which could cause actual results to differ materially from those contemplated in these forward-looking statements. These statements reflect our opinions only as of the date of this presentation, and we undertake no obligation to revise these forward-looking statements in light of new information or future events.

Kristen: Before we begin, I would like to remind you that certain statements made during this conference call are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements, others, and statements of historical facts made during this conference are forward-looking statements, including, without limitations, statements regarding our expectations and guidance for future financial and operational performance, expected growth, business outlook, and potential organic growth and acquisition. Forward looking statements may sometimes be identified with words such as will, they expect, plan, anticipate, upcoming, leave, estimate, or similar terminology and the negative of these terms. Forward looking statements are not promises or guarantees of future performance and are subject to a variety of risks and uncertainties, many of which are beyond our control, which would cause actual results to differ materially from most contemplated in these forward looking statements.

Speaker Change: Before we begin, I would like to remind you that certain statements made during this conference call are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended.

Speaker Change: All statements, other than statements of historical fact,

Speaker Change: made during this conference are forward-looking statements.

Speaker Change: including, without limitation, statements regarding our expectations and guidance for future financial and operational performance, expected growth, business outlook, and potential organic growth and acquisition.

Speaker Change: Forward-looking statements may sometimes be identified with words such as will, may, expect, plan, anticipate, upcoming, believe, estimate, or similar terminology and the negative of these terms.

Christian: Forward-looking statements are not promises or guarantees of future performance and are subject to a variety of risks and uncertainties, many of which are beyond our control, which could cause actual results to differ materially from those contemplated in these forward-looking statements. These statements reflect our opinions only as of the date of this presentation, and we undertake no obligation to revise these forward-looking statements in light of new information or future events. Please refer to our press release and our reports filed with the Securities and Exchange Commission, where you will find a more comprehensive discussion of our performance and factors that could cause actual results to differ materially from these forward-looking statements.

Speaker Change: Forward-looking statements are not promises or guarantees of future performance and are subject to a variety of risks and uncertainties, many of which are beyond our control, which would cause actual results to differ materially from those contemplated in these forward-looking statements.

Kristen: These statements reflect our opinions only as to the date of this presentation, and we undertake no obligation to revise these forward-looking statements in light of new information or future events.

Speaker Change: These statements reflect our opinions only as to the date of this presentation and we undertake no obligation to revise these forward-looking statements in light of new information or future events.

Christian: Please refer to our press release and our reports filed with the Securities and Exchange Commission, where you will find a more comprehensive discussion of our performance and factors that could cause actual results to differ materially from these forward-looking statements. For anyone who dialed into the call by telephone, you may wish to download our second quarter 2024 earnings presentation. Please visit our investor relations site, ir.carecloud.com. Click on News and Events, then click IR Calendar, click on Second Quarter 2024 Results Conference Call, and download the earnings presentation.

Kristen: Please refer to our press release in our reports filed with the Securities and Exchange Commission, where you will find a more comprehensive discussion of our performance in factors that could cause actual results to differ materially from these forward-looking statements.

Speaker Change: Please refer to our press release and our reports filed with the Securities and Exchange Commission, where you will find a more comprehensive discussion of our performance and factors that could cause actual results to differ materially from these forward-looking statements.

Kristen: For anyone who dialed into the call by telephone, you may wish to download our second quarter 2024 earnings presentation. Please visit our investor relations site, ir.carecloud.com, click on News and Events, then click IR Calendar, click on Second Quarter 2024 Results Conference Call and download the earnings presentation.

Christian: For anyone who dialed into the call by telephone, you may wish to download our second quarter 2024 earnings presentation. Please visit our investor relations site, ir.carecloud.com, click on News and Events, then click IR Calendar, click on Second Quarter 2024 Results Conference Call, and download the earnings presentation. Finally, on today's call, we may refer to certain non-GAAP financial measures.

Speaker Change: For anyone who dialed into the call by telephone, you may wish to download our second quarter 2024 earnings presentation. Please visit our investor relations site, ir.carecloud.com.

Speaker Change: Click on News and Events, then click IR Calendar, click on 2nd Quarter 2024 Results Conference Goal, and download the Earnings Presentation.

Kristen: Finally, on today's call, we may refer to certain non-GAAP financial measures. Please refer to today's press release announcing our second quarter 2024 results for reconciliation of these non-GAAP performance measures to our GAAP financial results.

Christian: Finally, on today's call, we may refer to certain non-GAAP financial measures. Please refer to today's press release announcing our second quarter 2024 results for a reconciliation of these non-GAAP performance measures to our GAAP financial results. With that said, I'll now turn the call over to our CEO, Hadi Chaudhry.

Speaker Change: Finally, on today's call, we may refer to certain non-GAAP financial measures. Please refer to today's press release announcing our second quarter 2024 results for a reconciliation of these non-GAAP performance measures to our GAAP financial results.

Christian: Please refer to today's press release announcing our second quarter 2024 results for a reconciliation of these non-GAAP performance measures to our GAAP financial results. With that said, I'll now turn the call over to our CEO, Hadi Chaudhry.

Hadi Chatterji: With that said, I'll now turn the call over to our CEO, Hadi Chaudhary. Thank you, Christian. And thanks to all of you for joining over a second quarter, 2024 earnings call. I'm very pleased to announce that we are turning the corner and never pivot towards improved profitability, as they were net income, free cash flow, and related metrics are all moving strongly in the right direction, even with lower non-recurring professional services revenues, enabling us to pay down $7.5 million on our credit facility to date this year. We will hear more about this from Stephen Norm, but what he was doing a great job generating cash each month instead of using cash as we were last year.

Speaker Change: With that said, I'll now turn the call over to our CEO, Hadi Chaudhry. Hadi?

Hadi Chaudhry: Thank you, Christian. And thanks to all of you for joining our second quarter 2024 earnings call. I'm very pleased to announce that we are turning the corner in our pivot towards improved profitability as our net income, free cash flow, and related metrics are all moving strongly in the right direction, even with lower non-recurring professional services revenues, enabling us to pay down $7.5 million on our credit facility to date this year. We will hear more about this from Steve and Norm, but our team is doing a great job generating cash each month instead of using cash as we Repaying our debt is a priority for us and is a key step to being able to restart the dividends on our preferred stock.

Hadi Chaudhry: And thanks to all of you for joining our second quarter 2024 earnings call. I'm very pleased to announce that we are turning the corner in our pivot towards improved profitability as our net income, free cash flow, and related metrics are all moving strongly in the right direction, even with lower non-recurring professional services revenues, enabling us to pay down $7.5 million on our credit facility to date this year. We will hear more about this from Steve and Norm, but our team is doing a great job generating cash each month instead of using cash as we were last year.

Hadi Chaudhry: Thank you, Christian. And thanks to all of you for joining our second quarter 2024 earnings call.

Hadi Chaudhry: I am very pleased to announce that we are turning the corner in our pivot towards improved profitability as our net income, free cash flow, and related metrics are all moving strongly in the right direction.

Hadi Chaudhry: even with lower non-recurring professional services revenues, enabling us to pay down $7.5 million on our credit facility to date this year.

Hadi Chaudhry: Repaying our debt is a priority for us and is a key step to being able to restart the dividends on our preferred stock. My level of focus has been on reducing expenses and improving profitability for the first half of the year, and this will remain a focus in the second half.

Speaker Change: We will hear more about this from Steve and Norm, but our team is doing a great job generating cash each month instead of using cash as we were last year. Repaying our debt is a priority for us and is a key step to being able to restart the dividends on our preferred stock.

Hadi Chatterji: Repaying our debt is a priority for us and is a key step to being able to start the dividends on our preferred stock. I know our focus has been on reducing expenses and improving profitability for the first half of the year, and this will remain a focus in the second half. We are starting to turn some attention to growth, which I know investors have been waiting to hear about. On our last earnings call, I talked about the addition of a new generative AI product called CareCloud Cirrus AI nodes. Today I am pleased to provide an update on the progress of CareCloud Cirrus AI nodes, which have now been deployed at a small subset of our existing clients.

Hadi Chaudhry: Our focus has been on reducing expenses and improving profitability for the first half of the year, and this will remain a focus in the second half. However, we are starting to turn some attention to growth, which I know investors have been waiting to hear about. On our last earnings call, I talked about the addition of a new generative AI product called CareCloud Cirrus AI Node. Today, I am pleased to provide an update on the progress of CareCloud Service AI nodes, which have now been deployed at a small subset of our existing clients.

Speaker Change: Our focus has been on reducing expenses and improving profitability for the first half of the year and this will remain a focus in the second half. We are starting to turn some attention to growth which I know investors have been waiting to hear about.

Hadi Chaudhry: We are starting to turn some attention to growth, which I know investors have been waiting to hear about. On our last earnings call, I talked about the addition of a new generative AI product called CareCloud Cirrus AI Node. Today, I am pleased to provide an update on CareCloud Service AI nodes, which have now been deployed at a small subset of our existing clients. Our pilot users have reported significant improvements in the efficiency and accuracy of clinical documentation.

Speaker Change: On our last earnings call, I talked about addition of new generative AI product called Care Cloud Serious AI Nodes. Today, I'm pleased to provide an update on the progress of Care Cloud Serious AI Nodes, which has now been deployed at a small subset of our existing clients.

Hadi Chaudhry: The ambient AI technology embedded within CareCloud Serious AI nodes has proven effective at capturing and transcribing crucial dialogue during patients' interactions, producing precise clinical notes in real time. As part of our rollout strategy, we offered a 30-day risk trial to these initial users, allowing them to fully explore the capabilities of CareCloud Serious AI Nodes. The feedback has been overwhelmingly positive, with users highlighting the seamless integration with their existing workflows and the time-saving benefits of real-time transcription. After the completion of the trial period, CareCloud SeraCI nodes will be available at a competitive license fee of $199 per provider per month.

Hadi Chatterji: Our pilot users have reported significant improvements in the efficiency and accuracy of clinical documentation. The MBA and AI technology embedded within CareCloud Cirrus AI nodes has proven effective at capturing and transcribing crucial dialogue during patients' interactions, producing precise clinical notes in real time. As part of our rollout strategy, we offered a 30-day risk-free trial to these initial users, allowing them to fully explore the capabilities of CareCloud Cirrus AI nodes. The feedback has been overwhelmingly positive, with users highlighting the seamless integration with their existing workflows and the time-saving benefits of real-time transcription. After the completion of the trial period, CareCloud Cirrus AI nodes will be available at a competitive license fee of $199 per provider per month.

Hadi Chaudhry: Our pilot users have reported significant improvements in the efficiency and accuracy of clinical documentation. The ambient AI technology embedded within CareCloud's AI nodes has proven effective at capturing and transcribing crucial dialogue during patient interactions, producing precise clinical notes in real time. As part of our rollout strategy, we offered a 30-day risk-free trial to these initial users, allowing them to fully explore the capabilities of CareCloud Serious AI Nodes. The feedback has been overwhelmingly positive, with users highlighting the seamless integration with their existing workflows and the time-saving benefits of real-time transcription. After the completion of the trial period, CareCloud SeraCI nodes will be available at a competitive license fee of $199 per provider per month.

Speaker Change: Our pilot users have reported significant improvements in the efficiency and accuracy of clinical documentation.

Speaker Change: The ambient AI technology embedded within ClearCloud Serious AI nodes has proven effective at capturing and transcribing crucial dialogue during patient interactions, producing precise clinical notes in real time.

Speaker Change: As part of our rollout strategy, we offered a 30-day risk-free trial to these initial users, allowing them to fully explore the capabilities of Care Cloud's Seros AI nodes.

Speaker Change: The feedback has been overwhelmingly positive, with users highlighting the seamless integration with their existing workflows and the time-saving benefits of real-time transcription.

Speaker Change: After the completion of the trial period, Care Cloud SeraCI nodes will be available at a competitive license fee of $199 per provider per month.

Hadi Chaudhry: This pricing structure reflects the value that CareCloud Service AI Notes brings to enhancing provider efficiency and patient care. We are confident that this offering will continue to gain momentum as more practices recognize the tangible benefits of integrating AI into their daily operations. We have started to recognize revenues from this product in the third quarter of 2024. Even though it's a very small number at the moment, we anticipate significant growth as adoption increases and more practices begin to see the value it brings to the operation.

Hadi Chatterji: This pricing structure reflects the value that CareCloud Cirrus AI nodes brings to enhancing provider efficiency and patient care. We are confident that this offering will continue to gain momentum as more practices recognize the tangible benefits of integrating AI into their daily operations. We have started to recognize revenues from this product in quarter third of 2024, even though it's a very small number at the moment. We anticipate significant growth as adoption increases and more practices begin to see the value it brings to the operation. One of our early adopters, which seven medical providers commented and used to using dictation devices, we are a very basic clinic.

Speaker Change: This pricing structure reflects the value that Care Cloud Service AI notes brings to enhancing provider efficiency and patient care. We are confident that this offering will continue to gain momentum as more practices recognize the tangible benefits of integrating AI into their daily operations.

Speaker Change: We have started to recognize revenues from this product and quarter third of 2024, even though it's a very small number at the moment, we anticipate significant growth as adoption increases and more practices begin to see the value it brings to the operation.

Hadi Chaudhry: One of our early adopters with seven medical providers commented, "I'm used to using dictation devices, but we are a very busy clinic. So I was trying to look for any way to make our workload easier. I found that CareCloud AI tools are very efficient when it comes to dictation."

Speaker Change: One of our early adopters with seven medical providers commented,

Hadi Chatterji: I was trying to look for any way to make our workload easier. I found that CareCloud AI tools are very efficient when it comes to dictation. Instead of me trying to figure out where information should go in the chart, as I am talking to the patient, this software automatically puts everything where it needs to be, and it's been amazing. It will add suggested codes based on the encounter. I'm still learning the nuances of this program, but so far, I'm enjoying it. We are saving a lot of time on the back. Kent.

Speaker Change: I'm used to using dictation devices, but we are a very busy clinic.

Speaker Change: So I was trying to look for any way to make our workload easier. I found that Care Cloud AI tools are very efficient when it comes to dictation.

Early Adopter: Instead of me trying to figure out where information should go in the chart as I'm talking to the patient, this software automatically puts everything where it needs to be. And it's been amazing. It will suggest codes based on the encounter.

Hadi Chaudhry: Instead of me trying to figure out where information should go in the chart as I'm talking to the patient, this software automatically puts everything where it needs to be. And it's been amazing. It will suggest codes based on the encounter.

Speaker Change: Instead of me trying to figure out where information should go in the chart, as I am talking to the patient, this software automatically puts everything where it needs to be and it's been amazing.

Hadi Chaudhry: I'm still learning the nuances of this program, but so far, I'm enjoying it. We are saving a lot of time on the back. In conclusion, we remain committed to advancing health care technology through innovative AI solutions like CareCloud Serious AI Nodes. As we expand CareCloud Serious AI Nodes to a broader audience, we anticipate continued growth and adoption, driving value for both of our clients and shareholders. Now, let's turn our attention to our revenue growth.

Hadi Chaudhry: I'm still learning the nuances of this program, but so far, I'm enjoying it. We are saving a lot of time on the back. In conclusion, we remain committed to advancing healthcare technology through innovative AI solutions like CareCloud Serious AI Nodes. As we expand CareCloud's Serious AI Nodes to a broader audience, we anticipate continued growth and adoption, driving value for both our clients and shareholders. Now, let's turn our attention to our revenue growth.

Speaker Change: It will add suggested codes based on the encounter. I'm still learning the nuances of this program, but so far I'm enjoying it. We are saving a lot of time on the back end.

Hadi Chatterji: In conclusion, we remain committed to advancing healthcare technology through innovative AI solutions like CareCloud Serious AI Nodes. As we expand CareCloud Serious AI nodes to a broader audience, we anticipate continued growth and adoption, driving value for both our clients and shareholders.

Speaker Change: In conclusion, we remain committed to advancing healthcare technology through innovative AI solutions, like Kair Klout Cirrus AI Notes.

Speaker Change: As we expand here at Cloud Cirrus AI Notes to a broader audience, we anticipate continued growth in adoption, driving value for both of our clients and shareholders.

Hadi Chatterji: Now, let's turn our attention to our revenue growth. In this quarter, we have continued to capitalize on our diversified client base, which stands multiple market segments, including hospitals and medical practices of all sizes. This diversity not only stabilizes our revenue streams, but also unlocks significant upsell and cross-sell opportunities. Our proprietary comprehensive suite of integrated products and services are uniquely positioned to offer tailored solutions that meet the evolving needs of our clients. This strategic approach allows us to deepen relationships, enhance client retention, and expand our footprint within each segment, driving both top-line growth and long-term value for our stakeholders.

Hadi Chaudhry: In this quarter, we have continued to capitalize on our diversified client base, which spans multiple market segments, including hospitals and medical practices of all sizes. This diversity not only stabilizes our revenue streams but also unlocks significant upsell and cross-sell opportunities. With our proprietary comprehensive suite of integrated products and services, we are uniquely positioned to offer tailored solutions that meet the evolving needs of our clients. This strategic approach allows us to deepen relationships, enhance client retention, and expand our footprint within each segment, driving both top line growth and long-term value for our stakeholders. Year-to-date bookings from cross-sell and up-sell initiatives have doubled compared to the same period last year.

Hadi Chaudhry: In this quarter, we have continued to capitalize on our diversified client base, which spans multiple market segments, including hospitals and medical practices of all sizes. This diversity not only stabilizes our revenue streams but also unlocks significant upsell and cross-sell opportunities. With our proprietary comprehensive suite of integrated products and services, we are uniquely positioned to offer tailored solutions that meet the evolving needs of our clients. This strategic approach allows us to deepen relationships, enhance client retention, and expand our footprint within each segment, driving both top-line growth and long-term value for our stakeholders. Day-to-day bookings from cross-sell and up-sell initiatives have doubled compared to the same period last year.

Speaker Change: Let's turn our attention to over revenue growth.

Speaker Change: In this quarter, we have continued to capitalize on our diversified client base, which spans multiple market segments, including hospitals and medical practices of all sizes. This diversity not only stabilizes our revenue streams, but also unlocks significant upsell and cross-sell opportunities.

Speaker Change: With our proprietary comprehensive suite of integrated products and services, we are uniquely positioned to offer tailored solutions that meet the evolving needs of our clients.

Speaker Change: This strategic approach allows us to deepen relationships, enhance client retention, and expand our footprint within each segment, driving both top-line growth and long-term value for our stakeholders.

Hadi Chatterji: Here's the data: things from cross-sell and upsell initiatives have doubled compared to the same period last year. We expect recognized revenue from these bookings to be approximately 50% higher in 2024 than last year. In Q2, our CareCloud wellness program, including chronic care management and remote patient monitoring, saw a remarkable 154% year-over-year revenue increase, exceeding a million dollars in recognized revenue for the first time in a quarter. Most of this revenue is derived from upselling within our existing client base. We see tremendous opportunity in this solution and are committed to further expanding this revenue stream. It has taken a long time for patients to recognize the value that our healthcare providers recognize immediately.

Speaker Change: Year-to-date bookings from cross-sell and up-sell initiatives have doubled compared to the same period last year. We expect recognized revenue from these bookings to be approximately 50% higher in 2024 than last year.

Hadi Chaudhry: We expect recognized revenue from these bookings to be approximately 50% higher in 2024 than last year. In Q2, our CareCloud wellness program, including chronic care management and remote patient monitoring, saw a remarkable 154% year-over-year revenue increase, a million dollars in recognized revenue for the first time in a quarter. Most of this revenue is derived from upselling within our existing client base. We see tremendous opportunity in this solution and are committed to further expanding this revenue stream. It has taken a long time for patients to recognize the value that our health care providers recognize immediately.

Hadi Chaudhry: We expect recognized revenue from these bookings to be approximately 50% higher in 2024 than last year. In Q2, our CareCloud wellness program, including chronic care management and remote patient monitoring, saw a remarkable 154% year-over-year revenue increase, receiving a million dollars in recognized revenue for the first time in a quarter. Most of this revenue is derived from upselling within our existing client base. We see tremendous opportunity in this solution and are committed to further expanding this revenue stream. It has taken a long time for patients to recognize the value that our health care providers recognize immediately.

Speaker Change: Due to our care cloud wellness program, including chronic care management and remote patient monitoring, saw a remarkable hundred and fifty four percent year-over-year revenue increase.

Speaker Change: exceeding a million dollars in recognized revenue for the first time in a quarter.

Speaker Change: Most of this revenue is derived from upselling within our existing client base.

Speaker Change: We see tremendous opportunity in this solution and are committed to further expanding this revenue stream. It has taken a long time for patients to recognize the value that our healthcare providers recognize immediately.

Hadi Chaudhry: And we think the use of this program will improve patient health and simultaneously control health care costs by identifying issues earlier before they get more serious. This year marks a pivotal transition for us, during which we have already reached significant milestones in fortifying our financial position and establishing a strong foundation for the future. Our primary focus remains on growing our positive free cash flow, which is crucial for not only covering operating expenses but also for paying down our credit line and eventually resuming the preferred dividend.

Hadi Chaudhry: And we think the use of this program will improve patient health and simultaneously control health care costs by identifying issues earlier before they get more serious. This year marks a pivotal transition for us, during which we have already reached significant milestones in fortifying our financial position and establishing a strong foundation for the future. Our primary focus remains on growing our positive free cash flow, which is crucial not only for covering operating expenses but also for paying down our credit line and eventually resuming the preferred dividend. We have made considerable progress towards these goals and are fully committed to maintaining this positive trajectory.

Hadi Chatterji: We think the use of this program will improve patient health and simultaneously control healthcare costs by identifying issues earlier, before they get more serious.

Speaker Change: And we think use of this program will improve patient health and simultaneously control health care costs by identifying issues earlier before they get more serious.

Hadi Chatterji: This year marks the pivotal transition for us during which we have already reached significant milestones in fortifying our financial position and establishing a strong foundation for the future. Our primary focus remains on growing our positive free cash flow, which is crucial not only for covering operating expenses but also for paying down our credit line and eventually resuming preferred dividends. We have made considerable progress towards these goals and are fully committed to maintaining this positive trajectory. As we look ahead to 2025, our focus will shift back towards driving growth. Our goal is to deliver consistent year-over-year revenue increases while enhancing profitability.

Speaker Change: This year marks a pivotal transition for us during which we have already reached significant milestones in fortifying our financial position and establishing a strong foundation for the future.

Speaker Change: Our primary focus remains on growing our positive free cash flow, which is crucial, not only covering operating expenses, but also for paying down our credit line and eventually resuming preferred dividends.

Hadi Chaudhry: We have made considerable progress towards these goals and are fully committed to maintaining this positive trajectory. As we look ahead to 2025, our focus will shift back towards driving growth. Our goal is to deliver consistent year-over-year revenue increases while enhancing profitability. We are confident that this growth will be fueled by multiple channels, including new sales, cross-sell, and up-sell opportunities, the continued innovation of our fully integrated AI solutions, and the expansion of our CareCloud wellness program.

Speaker Change: We have made considerable progress towards these goals and are fully committed to maintaining this positive trajectory.

Hadi Chaudhry: As we look ahead to 2025, our focus will shift back towards driving growth. Our goal is to deliver consistent year-over-year revenue increases while enhancing profitability. We are confident that this growth will be fueled by multiple channels, including new sales, cross-sell, and up-sell opportunities, the continued innovation of our fully integrated AI solutions, and the expansion of our CareCloud wellness program. Additionally, we plan to leverage our strategic partnerships, enabling our industry partners to utilize our white-table technology solutions and our highly-skilled global workforce.

Speaker Change: As we look ahead to 2025, our focus will shift back towards driving growth. Our goal is to deliver consistent year-over-year revenue and trees while enhancing profitability.

Hadi Chatterji: We are confident that this growth will be fueled by multiple channels, including new sales, cross-cell and upsell opportunities, the continued innovation of our fully integrated AI solutions, and the expansion of our care cloud wellness program. Additionally, we plan to leverage our strategic partnerships, enabling our industry players to utilize our wide-table technology solutions and our highly skilled global workforce. Finally, we aim to capitalize on our extensive high-quality healthcare data set to support life sciences companies, healthcare providers, and peers.

Speaker Change: We are confident that this growth will be fueled by multiple channels, including new sales, cross-sell and up-sell opportunities, the continued innovation of our fully integrated AI solutions, and the expansion of our Care Cloud wellness program.

Hadi Chaudhry: Additionally, we plan to leverage our strategic partnerships, enabling our industry players to utilize our white-table technology solutions and our highly-skilled global workforce. Finally, we aim to capitalize on our extensive, high-quality healthcare data set to support life sciences companies, healthcare providers, and payers. We will share more details on our growth strategy during our next earnings call. I will now turn the floor over to Stephen.

Speaker Change: Additionally, we plan to leverage our strategic partnerships, enabling our industry players to utilize our white-table technology solutions and our highly skilled global workforce.

Hadi Chaudhry: Finally, we aim to capitalize on our extensive, high-quality healthcare data set to support life sciences companies, healthcare providers, and payers. We will share more details on our growth strategy during our next earnings call. I will now turn the floor over to Steve.

Speaker Change: Finally, we aim to capitalize on our extensive high quality healthcare data set to support life sciences companies, healthcare providers and peers. We will share more details on our growth strategy you think of our next earnings call. I will now turn the floor over to Steve.

Hadi Chatterji: We will share more details on our growth strategy during our next earnings call.

Stephen Snyder: I will now turn the floor over to Steve. Good morning, and thank you, everyone, for joining us on today's call. As a team, we are making great progress at accomplishing our objective of transforming our call structure. With this transformation, we are achieving our goal of increasing our free cash flow, which will enable us this year to eliminate the entire balance on our credit line, which was 10 million at the start of the year, and move us closer to resuming dividends. Our revised call structure will position us to further expand margins, as we are heavily into revenue growth during 2025 and beyond.

Stephen Snyder: Good morning, and thank you everyone for joining us on today's call. As a team, we are making great progress accomplishing our objective of transforming our cost structure. With this transformation, we are achieving our goal of increasing our free cash flow, which will enable us this year to eliminate the entire balance on our credit line, which was 10 million at the start of the year and move us closer to resuming dividends.

Steve: The End

Steve: Good morning and thank you everyone for joining us on today's call.

Steve: As a team, we are making great progress at accomplishing our objective of transforming our cost structure.

Steve: With this transformation, we are achieving our goal of increasing our free cash flow, which will enable us this year to eliminate the entire balance on our credit line.

Steve: which was 10 million at the start of the year and move us closer to resuming dividends.

Stephen Snyder: Our revised cost structure will position us to further expand margins as we lean heavily into revenue growth during 2025 and beyond. Over the last three quarters, we have identified more than $26 million in annualized cost savings. Of this $26 million in savings, we expect to realize a reduction in our 2024 in-year expenses of approximately $20 million.

Stephen Snyder: Our revised cost structure will position us to further expand margins as we lean heavily into revenue growth during 2025 and beyond. Over the last three quarters, we have identified more than $26 million in annualized cost savings. Of this $26 million in savings, we expect to realize a reduction to our 2024 in-year expenses of approximately $20 million. We are achieving these savings through a three-pronged strategy.

Steve: Our revised cost structure will position us to further expand margins as we lean heavily into revenue growth during 2025 and beyond.

Stephen Snyder: Over the last three quarters, we have identified more than 26 million in annualized cost savings. Of this 26 million in savings, we expect to realize a reduction to our 2024 in-year expenses of approximately $20 million. We are achieving these savings through a three-pronged strategy. First, we are strategically deploying our proprietary technology, enabling us to reduce costs while accomplishing day-to-day tasks in a more systematic, effective, and repeatable manner. Second, we have continued to reduce our alliance on third-party contractors, leveraging our in-house expertise at a small fraction of the cost of the prior third-party contractor costs, while also increasing our control and reducing the natural risks that come with relying on third parties to handle critical business functions.

Speaker Change: In the next episode, we'll see you in the next episode.

Steve: Over the last three quarters, we have identified more than $26 million in annualized cost savings.

Steve: Of this $26 million in savings, we expect to realize a reduction to our 2024 in-year expenses of approximately $20 million.

Stephen Snyder: We are achieving these savings through a three-pronged strategy. First, we are strategically deploying our proprietary technology, enabling us to reduce costs while accomplishing day-to-day tasks in a more systematic, effective, and repeatable manner. Second, we have continued to reduce our reliance on third-party contractors, leveraging our in-house expertise at a small fraction of the cost of the prior third-party contractor costs, while also increasing our control and reducing the natural risks that come with relying on third parties to handle critical business functions.

Stephen Snyder: First, we are strategically deploying our proprietary technology, enabling us to reduce costs while accomplishing day-to-day tasks in a more systematic, effective, and repeatable manner. Second, we have continued to reduce our reliance on third-party contractors, leveraging our in-house expertise at a small fraction of the cost of the prior third-party contractor costs, while also increasing our control and reducing the natural risks that come with relying on third parties to handle critical business functions.

Steve: We are achieving these savings through a three-pronged strategy.

Steve: First, we are strategically deploying our proprietary technology enabling us to reduce costs while accomplishing day-to-day tasks in a more systematic, effective, and repeatable manner.

Steve: Second, we have continued to reduce our reliance on third-party contractors, leveraging our in-house expertise at a small fraction of the cost of the prior third-party contractor costs.

Steve: While also increasing our control and reducing the natural risks that come with relying on third parties to handle critical business functions.

Stephen Snyder: Third, we have leaned further into our core strength of our global business model. Strategically leveraging our most effective and cost-efficient resource for each discrete process, thereby enabling us to both increase our overall bandwidth while simultaneously reducing the associated costs.

Stephen Snyder: And third, we have leaned further into our core strength of our global business model, strategically leveraging our most effective and cost-efficient resource for each discrete process, thereby enabling us to both increase our overall bandwidth while simultaneously reducing the associated costs. In summary, this cost transformation has been made possible through our use of CareCloud's proprietary technology, eliminating expensive third-party relationships, and embracing the strength of a global model. During the first half of 2024, we were pleased to realize significantly improved year-over-year free cash flow and a large increase in cash provided from operations. And we turned our gap net income from negative to positive for the first time in two years. Our team's decisive actions are beginning to bear fruit.

Steve: And third, we have leaned further into our core strength of our global business model, strategically leveraging our most effective and cost-efficient resource for each discrete process.

Steve: thereby enabling us to both increase our overall bandwidth while simultaneously reducing the associated costs.

Stephen Snyder: In summary, this cost transformation has been made possible through our use of CareCloud's proprietary technology, eliminating expensive third-party relationships, and embracing the strength of our global model. During the first half of 2024, we were pleased to realize significantly improved year-over-year free cash flow, and a large increase in cash provided from operations. And we turned our gap net income from negative, deposited for the first time in two years. Our teams' decisive actions are beginning to yield fruit, and we are excited to see that our financial transformation is well underway.

Steve: In summary, this cost transformation has been made possible through our use of CareCloud's proprietary technology, eliminating expensive third-party relationships, and embracing the strength of a global model.

Stephen Snyder: During the first half of 2024, we were pleased to realize significantly improved year-over-year free cash flow and a large increase in cash provided from operations. And we turned our gap net income from negative to positive for the first time in two years. Our team's decisive actions are beginning to bear fruit.

Steve: During the first half of 2024, we were pleased to realize significantly improved year-over-year free cash flow and a large increase in cash provided from operations.

Steve: and we turned our gap net income from negative to positive for the first time in two years.

Stephen Snyder: And we're excited to see that our financial transformation is well underway. On a separate front, as we have communicated before, we distributed a special proxy to all Series A preferred shareholders, recommending their approval of certain important changes to the terms of our Series A preferred stock. If approved, holders of Series A preferred stock would be placed on a more equal footing with Series B shareholders, having similar protections in the event of a change of control and equivalent dividend rights.

Stephen Snyder: And we're excited to see that our financial transformation is well underway. On a separate front, as we have communicated before, we distributed a special proxy to all Series A preferred shareholders recommending their approval of certain important changes to the terms of our Series A preferred stock. If approved, holders of Series A preferred stock would be placed on a more equal footing with Series B shareholders, having similar protections in the event of a change of control and equivalent dividend rights.

Steve: Our team's decisive actions are beginning to yield fruit, and we're excited to see that our financial transformation is well underway.

Stephen Snyder: On a separate front, as we have communicated before, we distributed a special proxy to all Series A preferred shareholders, recommending the approval of certain important changes to the terms of our Series A preferred stock. If approved, holders of Series A preferred stock would be placed on a more equal footing with Series B shareholders, having similar protections in the event of a change of control and equivalent dividend rights. Further, the company would have the right to exchange common stock for Series A preferred shares as more fully described in the proxy materials that we filed with the SEC.

Steve: On a separate front, as we have communicated before, we distributed a special proxy to all Series A preferred shareholders, recommending their approval of certain important changes to the terms of our Series A preferred stock.

Steve: If approved, holders of Series A preferred stock would be placed on a more equal footing with Series B shareholders, having similar protections in the event of a change of control and equivalent dividend rights.

Stephen Snyder: In addition, the company would have the right to exchange common stock for Series A preferred shares, as more fully described in the proxy materials that we filed with the SEC. The initial response of the Series A preferred shareholders has been overwhelming and unambiguous. More than 85% of proxies returned to date have been in favor of the amendment. Support has also been shared by Glass Lewis, a leading proxy vote advisory firm that analyzed our proposal and recommended that shareholders vote for the changes.

Steve: Further, the company would have the right to exchange common stock or Series A preferred shares as more fully described in the proxy materials that we filed with the SEC.

Stephen Snyder: The initial response of the Series A preferred shareholders has been overwhelming and unambiguous. More than 85% of proxies returned the date have been in favor of the amendments. The support has been shared by Glass-Louis, a leading proxy vote advisory firm that analyzed our proposal and recommended that shareholders vote for the changes. While the level of support has been strong, we still need the affirmative vote of at least two-thirds of all outstanding shares. A challenge for even a popular proposal like this one, given a fragmented retail ownership base. Therefore, we encourage Series A preferred shareholders to take the time to read the proxy materials and then let their voices be heard.

Steve: The initial response of the Series A preferred shareholders has been overwhelming and unambiguous. More than 85% of proxies returned to date have been in favor of the amendments.

Stephen Snyder: Support has also been shared by Glass Lewis, a leading proxy vote advisory firm that analyzed our proposal and recommended that shareholders vote for the changes. While the level of support has been strong, we still need the affirmative vote of at least two-thirds of all outstanding shares, a challenge for even a popular proposal like this one, given a fragmented retail ownership base. Therefore, we encourage Series A preferred shareholders to take the time to read the proxy materials and then let their voices be heard. I'll now turn the floor over to our interim CFO, Norm Roth. Norm?

Steve: Support has been shared by Glass Lewis, a leading proxy vote advisory firm that analyzed our proposal and recommended that shareholders vote for the changes.

Stephen Snyder: While the level of support has been strong, we still need the affirmative vote of at least two-thirds of all outstanding shares, a challenge for even a popular proposal like this one, given a fragmented retail ownership base. Therefore, we encourage Series A preferred shareholders to take the time to read the proxy materials and then let their voices be heard. I'll now turn the floor over to our interim CFO, Norm Roth.

Steve: While the level of support has been strong, we still need the affirmative vote of at least two-thirds of all outstanding shares.

Steve: A challenge for even a popular proposal like this one, given a fragmented retail ownership base.

Steve: Therefore, we encourage Series A preferred shareholders to take the time to read the proxy materials and then let their voices be heard.

Norman Roth: I'll now turn the floor over to our insurance GFO, Nor Roth. Norm? Thanks, Steve, and thank you all for joining our call today. I would like to start by talking about our positive gap net income and cash flow, which I am sure are welcome news for investors. Second quarter of 2024 was our first quarter with positive gap net income since 2022. During the six months and the June 30th, 2024, we generated $8.3 million of cash from operations and $4.9 million of free cash flow. We were able to use the profits and cash flows we generated to repay 75% of the balance on our Silicon Valley Bank line of credit as of today.

Steve: I'll now turn the floor over to our intern CFO, Norm Roth.

Norman Roth: Thanks, Steve. And thank you all for joining our call today. I would like to start by talking about our positive gap in net income and cash flow, which I am sure are welcome news for investors. Second quarter of 2020.

Norman Roth: Thanks, Steve. And thank you all for joining our call today. I would like to start by talking about our positive gap net income and cash flow, which I am sure are welcome news for investors. The second quarter of 2024 was our first quarter with positive gap net income since 2022. During the six months ended June 30th, 2024, we generated $8.3 million of cash from operations and $4.9 million of free cash flow. We were able to use the profits and cash flows we generated to repay 75% of the balance on our Silicon Valley Bank line of credit as of today. As of June 30, 2024, we had repaid $5 million of the January 1 balance on our line of credit.

Steve: Norm?

Norm Roth: Thanks Steve and thank you all for joining our call today. I would like to start by talking about our positive gap net income and cash flow which I am sure are welcome news for investors.

Norm Roth: Second quarter of 2024 was our first quarter with positive gap net income since 2022. During the six months ended June 30th, 2024, we generated $8.3 million of cash from operations.

Operator: Ladies and gentlemen, welcome to the CareCloud second quarter, 2024 results conference call. At this time, all participants are in a listen no near mode. A brief question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star and zero on your telephone keypad. As a reminder, this conference has been recorded.

Norm Roth: and $4.9 million of free cash flow.

Norm Roth: We were able to use the profits and cash flows we generated to repay 75% of the balance on our Silicon Valley Bank line of credit as of today.

Norman Roth: As of June 30th, 2024, we had repaid $5 million of the January 1 balance on our line of credit. Since June 30th, we repaid an additional $2.5 million, bringing the balance from $10 million on January 1 of this year to $2.5 million today. This means we have much more financial flexibility. In the second quarter, we reported revenues of $28.1 million, while down $1.3 million year over year. $1 million of the decline was due to MedisR, which is a project-based professional services business that tends to fluctuate. MedisR has had softness since the second half of last year, which is continuing, but we are hopeful that we will see some growth in the second half of 2024.

Norman Roth: As of June 30, 2024, we had repaid $5 million of the January 1 balance on our line of credit. Since June 30th, we have repaid an additional $2.5 million, bringing the balance from $10 million on January 1 of this year to $2.5 million today. This means we have much more financial flexibility.

Norm Roth: As of June 30, 2024, we had repaid $5 million of the January 1 balance on our line of credit.

Norman Roth: Since June 30th, we have repaid an additional $2.5 million, bringing the balance from $10 million on January 1 of this year to $2.5 million today. This means we have much more financial flexibility. In the second quarter, we reported revenues of $28.1 million. While down $1.3 million year over year, $1 million of the decline was due to MedSR, which is a project-based professional services business that tends to fluctuate. MetaSARS has had softness since the second half of last year, which is continuing.

Norm Roth: Since June 30th, we repaid an additional $2.5 million, bringing the balance from $10 million on January 1 of this year to $2.5 million today. This means we have much more financial flexibility.

Operator: I will now turn the call over to Kristen. Thank you. You may begin.

Norman Roth: In the second quarter, we reported revenues of $28.1 million. While down $1.3 million year over year, $1 million of the decline was due to MedSR, which is a project-based professional services business that tends to fluctuate. MetaSAR has had softness since the second half of last year, which is continuing.

Kristen: Good morning, everyone. Welcome to CareCloud second quarter, 2024 conference call.

Norm Roth: In the second quarter, we reported revenues of $28.1 million.

Kristen: On today's call, our Mahmud Haq, our founder and executive chairman, Hadi Chatterji, our chief executive officer and director, Stephen Schneider, our president and Norman Roth are interim chief financial officer and controller. Before we begin, I would like to remind you that certain statements made during this conference call, are forward looking statements within the meaning of section 27A of the Securities Act of 1933, as amended in section 21 E of the Securities Exchange Act of 1934 as amended.

Norm Roth: While down $1.3 million year-over-year, $1 million of the decline was due to MedSR, which is a project-based professional services business that tends to fluctuate.

Norm Roth: MetaSAR has had softness since the second half of last year which is continuing.

Norman Roth: But we are hopeful that we will see some growth in the second half of 2024. However, CareCloud Wellness generated over one million dollars in revenue for the first time this quarter and is up by one point one million dollars for the first six months of this year compared to last year. Our direct operating costs continue to decline, and they are down by nearly $2.2 million from Q2 2023. Our operating expenses, including G&A, R&D, and sales and marketing expenses, decreased by $2.9 million.

Norman Roth: However, Care Cloud Wellness generated over $1 million in revenue for the first time this quarter and is up by $1.1 million for the first six months this year compared to 2023. Our direct operating costs continue to decline, and they are down by nearly $2.2 million from Q2 2023.

Norm Roth: But we are hopeful that we will see some growth in the second half of 2024. However, CareCloud Wellness generated over $1 million in revenue for the first time this quarter.

Kristen: All statements, others and statements of historical facts, made during this conference are forward looking statements, including without limitations statements regarding our expectations and guidance for future financial and operational performance expected growth, business outlook and potential organic growth and acquisition. Forward looking statements may sometimes be identified with words such as will, they expect, plan, anticipate, upcoming, leave, estimate or similar terminology and the negative of these terms. Forward looking statements are not promises or guarantees of future performance and are subject to a variety of risk and uncertainties, many of which are beyond our control, which would cause actual results to differ materially from most contemplated in these forward looking statements.

Norm Roth: and is up by $1.1 million for the first six months this year compared to 2023.

Norm Roth: Our direct operating costs continue to decline, and they are down by nearly $2.2 million from Q2 2023.

Norman Roth: D. Our operating expenses, including GNA, R&D, and sales and marketing expenses, decreased by $2.9 million. On an annual run rate basis, these operating expenses are already down over $20 million since Q1 2023. In the second quarter, we reported positive GAAP operating income of $2.3 million and GAAP net income of $1.7 million, both the highest amounts since Q2 2022. This compares to a gap operating loss of $1.3 million and a gap net loss of $1.8 million during Q2 2023. The gap nut loss per share was 14 cents based on the net loss attributable to common shareholders, which takes into account the preferred stock dividends earned, whether or not they were declared or paid during the quarter.

Norm Roth: are operating expenses including G&A, R&D, and sales and marketing expenses.

Norman Roth: On an annual run rate basis, these operating expenses are already down over $20 million. Q1 2020. In the second quarter, we reported positive GAAP operating income of $2.3 million and GAAP net income of $1.7 million, both the highest amounts since Q2 2022. This compares to a GAAP operating loss of $1.3 million and a GAAP net loss of $1.8 million during Q2 2022. The GAAP net loss per share was $0.14 based on the net loss attributable to common shareholders, which takes into account the preferred stock dividends earned, whether or not they were declared or paid during the quarter.

Norm Roth: decreased by 2.9 million dollars. On an annual run rate basis, these operating expenses are already down over 20 million dollars since Q1 2023.

Norman Roth: Q1 2020; In the second quarter, we reported positive GAAP operating income of $2.3 million and GAAP net income of $1.7 million, both the highest amounts since Q2 2022. This compares to a GAAP operating loss of $1.3 million and a GAAP net loss of $1.8 million during Q2 2022. The gap net loss per share was $0.14 based on the net loss attributable to common shareholders, which takes into account the preferred stock dividends earned, whether or not they were declared or paid during the quarter. This requires a little explanation.

Norm Roth: In the second quarter, we reported positive GAAP operating income of $2.3 million and GAAP net income of $1.7 million, both the highest amount since Q2 2022.

Norm Roth: This compares to a GAAP operating loss of $1.3 million and a GAAP net loss of $1.8 million during Q2 2023.

Kristen: These statements reflect our opinions only as to the date of this presentation and we undertake no obligation to revise these forward looking statements in light of new information or future events. Please refer to our press release in our reports filed with the Securities and Exchange Commission, where you will find a more comprehensive discussion of our performance in factors that could cause actual results to differ materially from these forward looking statements. For anyone who dialed into the call by telephone, you may wish to download our second quarter 2024 earnings presentation.

Norm Roth: The gap net loss per share was $0.14 based on the net loss attributable to common shareholders, which takes into account the preferred stock dividends earned, whether or not they were declared or paid during the quarter. This requires a little explanation.

Norman Roth: This requires a little explanation. Even though by definition, gap net income is always shown before dividends, and only dividends which have been declared by our board of directors are recorded on the balance sheet, the gap net loss per common share calculation reflects the dividends that accumulate monthly, whether or not these dividends were declared or paid. Non-GAAP adjusted net income for the second quarter of 2024 was $3 million, or 18 cents per share, calculated using the end-of-period common shares outstanding. We reported adjusted EBITDA of $6.4 million in the second quarter compared to $3.8 million in the same period last year.

Norman Roth: This requires a little explanation. Even though, by definition, gap net income is always shown before dividends, and only dividends which have been declared by our Board of Directors are recorded on the balance sheet, the Gap Net Loss per Common Share Calculation reflects the dividends that accumulate monthly, whether or not these dividends were declared or paid.

Norman Roth: Even though, by definition, gap net income is always shown before dividends, and only dividends which have been declared by our Board of Directors are recorded on the balance sheet. The Gap Net Loss per Common Share Calculation reflects the dividends that accumulate monthly, whether or not these dividends were declared or paid. Non-GAAP-adjusted net income for the second quarter of 2024 was $3 million, or $0.18 per share, calculated using the end-of-period common shares outstanding.

Norm Roth: Even though, by definition, gap net income is always shown before dividends.

Norm Roth: and only dividends which have been declared by our Board of Directors are recorded on the balance sheet.

Kristen: Please visit our investor relations site, ir.carecloud.com, click on news and events, then click ir calendar, click on second quarter 2024 results conference call and download the earnings presentation. Finally, on today's call, we may refer to certain non-GAP financial measures. Please refer to today's press release announcing our second quarter 2024 results for reconciliation of these non-GAP performances measures to our GAP financial results.

Norm Roth: The Gap Net Loss per Common Share Calculation reflects the dividends that accumulate monthly

Norman Roth: Non-GAAP-adjusted net income for the second quarter of 2024 was $3 million, or $0.18 per share, calculated using the end-of-period common shares outstanding. We reported adjusted EBITDA of $6.4 million in the second quarter compared to $3.8 million in the same period last year. This is our highest adjusted EBITDA since the second quarter of 2020. Revenue for the first six months of 2024 was $54.1 million, compared to $59.4 million in the first six months of 2023.

Norm Roth: Whether or not these dividends were declared or paid.

Norm Roth: Non-GAAP adjusted net income for the second quarter of 2024 was $3 million, or 18 cents per share, calculated using the end-of-period common shares outstanding.

Norman Roth: We reported adjusted EBITDA of $6.4 million in the second quarter, compared to $3.8 million in the same period last year. This is our highest adjusted EBITDA since the second quarter of 2020. Revenue for the first six months of 2024 was $54.1 million, compared to $59.4 million in the first six months of 2023. $5.3 million decline; $3.3 million was attributable to Medistar. For the first six months of 2024, the company's gap net income was $1.4 million, compared to a gap net loss of $2.2 million in the first six months of 2023.

Norm Roth: We reported adjusted EBITDA of $6.4 million in the second quarter compared to $3.8 million in the same period last year.

Norman Roth: This is our highest adjusted EBITDA since the second quarter of 2022. Revenue for the first six months of 2024 was $54.1 million compared to $59.4 million in the first six months of 2023. Of the $5.3 million decline, $3.3 million was attributable to Metastar. For the first six months of 2024, the company's GAAP net income was $1.4 million compared to a GAAP net loss of $2.2 million in the first six months of 2023. This equates to a loss of $0.24 per share after subtracting the first stock dividends earned but not declared or paid. Non-GAAP adjusted net income for the first half of 2024 was $3.2 million, or 20 cents per share.

Hadi Chatterji: With that said, I'll now turn the call over to our CEO, Hadi Chaudhary. Thank you, Christian. And thanks to all of you for joining over a second quarter, 2024 earnings call.

Norm Roth: This is our highest adjusted EBITDA since the second quarter of 2022.

Norm Roth: Revenue for the first six months of 2024 was $54.1 million compared to $59.4 million in the first six months of 2023.

Norman Roth: $5.3 million decline. $3.3 million was attributable to Medistar. For the first six months of 2024, the company's gap net income was $1.4 million, compared to a gap net loss of $2.2 million in the first six months of 2023. This equates to a loss of $0.24 per share. After subtracting the preferred stock dividends earned but not declared or paid, non-gap adjusted net income for the first half of 2024 was $3.2 million, or $0.20 per share.

Hadi Chatterji: I'm very pleased to announce that we are turning the corner and never pivot towards improved profitability as they were net income, free cash flow, and related metrics are all moving strongly in the right direction, even with lower non-recurring professional services revenues, enabling us to pay down $7.5 million on our credit facility to date this year. We will hear more about this from Stephen Norm, but what he was doing a great job generating cash each month instead of using cash as we were last year.

Norm Roth: Of the $5.3 million decline, $3.3 million was attributable to MedSR.

Norm Roth: For the first six months of 2024, the company's gap net income was $1.4 million.

Norm Roth: compared to a gap net loss of $2.2 million in the first six months of 2023. This equates to a loss of 24 cents per share after subtracting the preferred stock dividends earned but not declared or paid.

Norman Roth: This equates to a loss of $0.24 per share. After subtracting the preferred stock dividends earned but not declared or paid, non-gap adjusted net income for the first half of 2024 was $3.2 million, or 20 cents per share. Year-to-date adjusted EBITDA was $10.1 million, an increase of $2 million from $8.1 million in the same period last year. As of June 30, 2024, the company had approximately $2.6 million in cash, net working capital was $674,000, and we had $5 million drawn on our line of credit.

Norm Roth: Non-Gap Adjusted Net Income for the first half of 2024 was $3.2 million or 20 cents per share.

Norman Roth: Year-to-date adjusted EBITDA was $10.1 million and increased of $2 million from $8.1 million in the same period last year. As of June 30, 2024, the company had approximately $2.6 million of cash. Networking capital was $674,000, and we had $5 million drawn on our line of credit. As previously stated, since June 30, we repaid an additional $2.5 million on the line, bringing the balance to $2.5 million today. Now that we are not dependent on our SBB line of credit, the company is considering reducing the total size of the line of credit from $25 million to $10 million.

Norman Roth: Year-to-date adjusted EBITDA was $10.1 million, an increase of $2 million from $8.1 million in the same period last year. As of June 30, 2024, the company had approximately $2.6 million in cash. Net working capital was $674,000, and we had $5 million drawn on our line of credit. As previously stated, since June 30th, we repaid an additional $2.5 million on the line, bringing the balance to $2.5 million today. Now that we are not dependent on our SVB line of credit, the company is considering reducing the total size of the line of credit from $25 million to $10 million.

Norm Roth: Year-to-date, adjusted EBITDA was $10.1 million, an increase of $2 million from $8.1 million in the same period last year.

Norm Roth: As of June 30, 2024, the company had approximately $2.6 million of cash. Net working capital was $674,000, and we had $5 million drawn on our line of credit.

Hadi Chatterji: We are starting to turn some attention to growth, which I know investors have been waiting to hear about. On our last earnings call, I talked about addition of new generative AI product called CareCloud Cirrus AI nodes. Today I am pleased to provide an update on the progress of CareCloud Cirrus AI nodes, which has now been deployed at a small subset of our existing clients. Our pilot users have reported significant improvements in the efficiency and accuracy of clinical documentation.

Norman Roth: As previously stated, since June 30th, we repaid an additional $2.5 million on the line, bringing the balance to $2.5 million today. Now that we are not dependent on our SVB line of credit, the company is considering reducing the total size of the line of credit from $25 million to $10 million.

Norm Roth: As previously stated, since June 30th, we repaid an additional $2.5 million on the line, bringing the balance to $2.5 million today.

Norm Roth: Now that we are not dependent on our SVB line of credit, the company is considering reducing the total size of the line of credit from $25 million to $10 million. This would save us fees on the unused portions of the line.

Norman Roth: This would save us fees on the unused portions of the line. Dean, but still provide the company with ample liquidity in the event there is a cash need. The second quarter results puts us on a good footing for the year ahead. We're happy to have returned to profitability and look forward to updating you later in the year.

Hadi Chatterji: The MBA and AI technology embedded within CareCloud Cirrus AI nodes has proven effective at capturing and transcribing crucial dialogue during patients' interactions, producing precise clinical notes in real time. As part of our rollout strategy, we offered a 30-day risk-free trial to these initial users, allowing them to fully explore the capabilities of CareCloud Cirrus AI nodes. The feedback has been overwhelmingly positive with users highlighting the seamless integration with their existing workflows and the time-saving benefits of real-time transcription.

Norman Roth: This would save us fees on the unused portions of the line and still provide the company with ample liquidity in the event there is a cash, The second quarter results put us on a good footing for the year ahead. We're happy to have returned to profitability and look forward to updating you later in the year. With that, I'll now turn the call over to Mahmud for his closing remarks.

Norm Roth: but still provide the company with ample liquidity in the event there is a cash need.

Norm Roth: The second quarter results puts us on a good footing for the year ahead. We're happy to have returned to profitability and look forward to updating you later in the year.

Mahmud Haq: With that, I'll turn the call over to Mahmud for his closing remarks. Mahmud? Thank you, Norm.

Norman Roth: This would save us fees on the unused portions of the line and still provide the company with ample liquidity in the event there is a cash crunch. The second quarter results put us on a good footing for the year ahead. We're happy to have returned to profitability and look forward to updating you later in the year. With that, I'll now turn the call over to Mahmud for his closing remarks. Thank you, Norm. We are very pleased with the great improvement in profit.

Norm Roth: With that, I'll now turn the call over to Mahmud for his closing remarks.

Mahmud Haq: Thank you, Norm. We are very pleased with the great improvement and profitability that we have achieved. Our primary focus is on creating long-term value for our shareholders. I would like to thank our employees, our customers, and shareholders for their continuous support in furthering CareCloud's mission. Operator, please open the floor for questions. Thank you.

Mahmud Haq: We are very pleased with the great improvement and profitability that we have achieved. Our primary focus is on creating long-term value for our shareholders.

Mahmud Haq: Thank you, Norm. We are very pleased with the great improvement in profitability that we have achieved. Our primary focus is on creating long-term value for our shareholders.

Hadi Chatterji: After the completion of the trial period, CareCloud Cirrus AI nodes will be available at a competitive license fee of $199 per provider per month. This pricing structure reflects the value that CareCloud Cirrus AI nodes brings to enhancing provider efficiency and patient care. We are confident that this offering will continue to gain momentum as more practices recognize the tangible benefits of integrating AI into their daily operations. We have started to recognize revenues from this product in quarter-third of 2024, even though it's a very small number at the moment, we anticipate significant growth as adoption increases and more practices begin to see the value it brings to the operation.

Mahmud Haq: I would like to thank our employees, our customers, and shareholders for their continuous support in furthering CareCloud's mission.

Mahmud Haq: I would like to thank our employees, our customers and shareholders for their continuous support in furthering CareCloud's mission. Operator, please open the floor for questions.

Operator: Operator, please open the floor for questions. Thank you. Ladies and gentlemen, we will now be conducting a question-and-answer session. If you'd like to ask a question, please press star and one on the telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star and two if you would like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. Ladies and gentlemen, we will wait for a moment while we poll for questions.

Operator: Ladies and gentlemen, we will now be conducting a question and answer session. If you would like to ask a question, please press star and one on the telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star and two if you would like to remove your question from the queue.

Speaker Change: Thank you.

Speaker Change: Ladies and gentlemen, we will now be conducting a question and answer session.

Speaker Change: If you would like to ask a question, please press star and 1 on the telephone keypad.

Speaker Change: A confirmation tone will indicate your line is in the question queue.

Speaker Change: You may press star and 2 if you would like to remove your question from the queue.

Operator: For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. Ladies and gentlemen, we will wait for a moment while we poll for questions. The first question is from Jeffrey Cohen with Ledenberg Talman. Please go ahead with your question. Good morning, this is Destiny on for Jeff.

Speaker Change: For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys.

Hadi Chatterji: One of our early adopters, which seven medical providers commented, and used to using dictation devices, we are a very basic clinic. I was trying to look for any way to make our workload easier. I found that CareCloud AI tools are very efficient when it comes to dictation. Instead of me trying to figure out where information should go in the chart, as I am talking to the patient, this software automatically puts everything where it needs to be and it's been amazing. It will add suggested codes based on the encounter. I'm still learning the nuances of this program, but so far, I'm enjoying it. We are saving a lot of time on the back.

Operator: Ladies and gentlemen, we will wait for a moment while we poll for questions. The first question is from Jeffrey Cohen with Ladenburg Talman. Please go ahead with your question.

Speaker Change: Ladies and gentlemen, we will wait for a moment while we poll for questions.

Unknown Executive: Kent.

Speaker Change: and others. Thank you. Thank you. Thank you. Thank you.

Jeffrey Cohen: The first question is from Jeffery Cohen with Layden Bogtalman. Please go ahead with the question. Good morning. This is definitely on for Jeff. I just had a few quick questions.

Speaker Change: D.O.T.

Speaker Change: Thanks for watching, and don't forget to like, share, and subscribe to our channel.

Speaker Change: The first question is from Jeffrey Cohen with Ledenberg Talman. Please go ahead with your question.

Destiny Buch: I just had a few quick questions. Maybe I'll start with your comments around contractors versus in-house. And I'm wondering what percentage now of your operations are through contractors and what percentage is now in-house. Okay, Stephanie. Good morning.

Destiny: Good morning, this is Destiny speaking on behalf of Jeff. I just had a few quick questions. Maybe I'll start with your comments around contractors versus in-house. And I'm wondering what percentage now of your operations is through contractors and what percentage is now in-house.

Speaker Change: and many more. Thank you. Thank you.

Speaker Change: Good morning, this is Destiny on for Jeff. I just had a few quick questions Maybe I'll start with your comments around Contractors versus

Destiny Buch: Maybe I'll start with your comments around contractors versus in-house. I'm wondering what percentage now of your operations is through contractors and what percentage is now in-house?

Hadi Chatterji: In conclusion, we remain committed to advancing healthcare technology through innovative AI solutions like CareCloud Serious AI nodes. As we expand CareCloud Serious AI nodes to a broader audience, we anticipate continued growth and adoption, driving value for both our clients and shareholders.

Destiny: in-house and I'm wondering what percentage now of your operations is through contractors and what percentage is now in-house?

Stephen Snyder: Okay, Stephanie. Good morning. Thank you for the question.

Hadi Chaudhry: And thank you. Thank you for the question. And just a little clarification, then I turn it over to Steve. So when we talk about contractors, it was they were one or two very specific contractors on the IT side, which were being used by the CareCloud acquisition that we did, the CareCloud that's part of us now. So it's not that any operational, the RCM side of the thing, there were some very specific niche areas on the technology development side for which we were using contractors, which took us a little more time than usual to transition to our workforce.

Hadi Chaudhry: Okay, Stephanie, good morning. And thank you. Thank you for the question.

Stephen Snyder: I just a little clarification that I over to Steve. When we talk about contractors, it was they were one or two very specific contractors on the IT side, which were being used by the CareCloud acquisition that we did, the CareCloud that's part of us now. It's not that any operational, the RC inside of the thing; there were some very specific niche areas on the technology development style for which we were using the contractors, which took us a little more time than usual to transition to overwork for us.

Steve: Okay, Stephanie, good morning. And thank you. Thank you for the, for the question. And just a little clarification that I turn it over to Steve. So when we talk about contractors.

Speaker Change: It was, there were one or two very specific contractors on the IT side which were being used by the Care Cloud acquisition that we did, the Care Cloud that's part of us now. So it's not that any operational, the RCM side of the thing, there were some very specific niche areas on the technology development side for which we were using the contractors which took us a little more time than usual to transition to our workforce. So in terms of the percent, I'm not sure if Steve or Norm, if you have any...

Hadi Chaudhry: So in terms of the percent, not sure if Steve or Norm, if you have any, but if it's Steve, if by any chance, do you have any specific number for that contractor percent? Not a specific number, but the overwhelming majority of the work being performed is performed by our employees.

Hadi Chaudhry: And just a little clarification before I turn it over to Steve. So when we talk about contractors, it was they were one or two very specific contractors on the IT side who were being used by the CareCloud acquisition that we did, CareCloud that's part of us now. So it's not that any operational, the RCM side of the thing, there were some very specific niche areas on the technology development side for which we were using the contractors, which took us a little more time than usual to transition to our workforce. So in terms of the percent, not sure if Steve or Norm, if you have any, but if Steve, if by any chance, do you have any specific number for that contractor percent?

Hadi Chatterji: Our proprietary comprehensive suite of integrated products and services are uniquely positioned to offer tailored solutions that need the evolving needs of our clients. This strategic approach allows us to deepen relationships, enhance client retention, and expand our footprint within each segment, driving both top-line growth and long-term value for our stakeholders. Here's the data things from cross-sell and upsell initiatives have doubled compared to the same period last year. We expect recognized revenue from these bookings to be approximately 50% higher in 2024 than last year.

Stephen Snyder: So, in terms of the percent, I'm not sure if Steve or Norm would give any, but it's Steve. If any chance, do you have any specific number for that contractor percent? Not a specific number, but the overwhelming majority of the work being performed is performed by our employees. There's a really minute portion that's being performed Destiny by contractors. And as Tommy said, really the contractors that we spoke about were a variety of different subcontractors, some in India, some in Central America and South America that were helping us from an R&D perspective, and they were really a holdover from two prior acquisitions.

Speaker Change: If by any chance do you have any specific number for that contractor percent?

Stephen Snyder: Not a specific number, but the overwhelming majority of the work being performed is performed by our employees. There's a really minute portion that's being performed indefinitely by contractors. As Hadi said, really, the contractors that we spoke about were a variety of different subcontractors, some in India, some in Central America, and South America, that were helping us from an R&D perspective. And they were really a holdover from two prior acquisitions. So as we move forward and we analyze that particular spend, we really came to the conclusion that we would be much better off long-term reducing that overall expense, which can be by moving to our in-house experts. We're able to reduce that expense by about 80, 85% roughly, and also have greater control over the work being performed. So really, a positive all the way around.

Destiny: Okay, I got it. Yeah, that makes sense.

Speaker Change: Not a specific number, but the overwhelming majority of the work being performed is performed by our employees. There's a really minute portion that's being performed destiny by contractors.

Stephen Snyder: There's a really tiny portion that's being performed, Destiny, by contractors. As Hadi said, really, the contractors that we spoke about were a variety of different subcontractors, some in India, some in Central America and South America, that were helping us from an R&D perspective, and they were really a holdover from two prior acquisitions. So as we move forward and we analyze that particular spend, we really came to the conclusion that we would be much better off long-term reducing that overall expense, which can be by moving to our in-house experts. We're able to reduce that expense by about 85%, roughly, and also have greater control over the work being performed. So really, a positive all the way around.

Speaker Change: As Hadi said, really the contractors that we spoke about were a variety of

Hadi Chatterji: In Q2, our CareCloud wellness program, including chronic care management and remote patient monitoring, saw a remarkable 154% year-over-year revenue increase, exceeding a million dollars in recognized revenue for the first time in a quarter. Most of this revenue is derived from upselling within our existing client base. We see tremendous opportunity in this solution and are committed to further expanding this revenue stream. It has taken a long time for patients to recognize the value that our healthcare providers recognize immediately. We think the use of this program will improve patient health and simultaneously control healthcare costs by identifying issues earlier before they get more serious.

Hadi Chaudhry: of different subcontractors, some in India, some in Central America and South America, that were helping us from an R&D perspective and they were really a holdover from two prior acquisitions.

Stephen Snyder: So, as we move forward and we analyze that particular spend, we really came to the conclusion that we would be much better off long-term reducing that overall expense, which can, with by moving to our in-house experts, were able to reduce that expense by about 80, 85 percent roughly. and then also have greater control over the work being performed. So really a positive all the way around.

Hadi Chaudhry: So, as we move forward and we analyze that particular spend,

Hadi Chaudhry: We really came to the conclusion that we would be much better off long-term reducing that overall expense, which, by moving to our in-house experts, we were able to reduce that expense by about 80-85% roughly.

Hadi Chaudhry: and also have greater control over the work being performed. So, really a positive all the way around.

Destiny Buch: Okay, got it. Yeah, that makes sense.

Destiny Buch: Okay, got it. Yeah, that makes sense. And then I'd kind of like to move to your commentary around industry partners, especially moving into 2025. Is the interest largely inbound, or are you also? Are there also efforts kind of outbound as well, finding potential partners that way? A great question, Destiny. So it's both.

Destiny: And then I'd kind of like to move to your commentary around industry partners, especially moving into 2025. Is the interest largely inbound, or are you also? Are there also efforts kind of outbound as well, finding potential partners that way?

Hadi Chatterji: This year marks the pivotal transition for us during which we have already reached significant milestones in fortifying our financial position and establishing a strong foundation for the future. Our primary focus remains on growing our positive free cash flow, which is crucial not only covering operating expenses but also for paying down our credit line and eventually resuming preferred dividends. We have made considerable progress towards these goals and are fully committed to maintaining this positive trajectory.

Destiny Buch: And then I'd kind of like to move to your commentary around industry partners, especially moving into 2025. Is the interest largely inbound? Or are there also efforts, kind of outbound as well, finding potential partners that way? Great question, Destiny. So it's both. So one is we already have multiple channel partners who we work with. So they are either acting as a resellers for us or, let's say, for our Care Cloud Force as an example. So we are there number of these partners we leverage over employees. So there is an inbound interest for expansion based on the different marketing campaigns, and then they will be spending more, doing some more investment towards and outreach for finding additional partners.

Speaker Change: Okay, got it. Yeah, that makes sense. And then I'd kind of like to move to your commentary around industry partners, especially moving into 2025. Is the interest largely inbound or are you also

Speaker Change: Are there also efforts kind of outbound as well, finding potential partners that way?

Hadi Chaudhry: Great question, Destiny. So it's both.

Hadi Chaudhry: So one is that we already have multiple channel partners who we work with. So they are either acting as resellers for us, or let's say for our CareCloud force, as an example. So we have a number of these partners who leverage our employees. So there is an inbound interest for expansion based on the different marketing campaigns, and then we'll be spending more, doing some more investment towards an outreach for finding additional partners. Okay, got it. And then, historically, if I remember correctly, you've given us kind of a number on the value of your pipeline. Are you able to provide those numbers?

Speaker Change: Great question, Destiny. So it's both. So one is...

Speaker Change: We already have multiple channel partners who we work with, so they are either acting as resellers for us or let's say for our K-Cloud Force as an example. So we have a number of these partners who leverage our employees. So there is an inbound interest for expansion based on the different marketing campaigns and then we'll be spending more, doing some more investment towards an outreach for finding additional partners.

Hadi Chatterji: As we look ahead to 2025, our focus will shift back towards driving growth. Our goal is to deliver consistent year-over-year revenue increases while enhancing profitability. We are confident that this growth will be fueled by multiple channels including new sales, cross-cell and upsell opportunities, the continued innovation of our fully integrated AI solutions and the expansion of our care cloud wellness program. Additionally, we plan to leverage our strategic partnerships, enabling our industry players to utilize our wide-table technology solutions and our highly skilled global workforce. Finally, we aim to capitalize on our extensive high-quality healthcare data set to support life sciences companies, healthcare providers and peers.

Hadi Chaudhry: So one is, we already have multiple channel partners who we work with. So they are either acting as resellers for us, or, let's say, for our CareCloud Force as an example. So we have a number of these partners who leverage our employees. So there is an inbound interest for expansion based on the different marketing campaigns, and then we'll be spending more, doing some more investment towards an outreach for finding additional partners.

Destiny Buch: Okay, got it.

Destiny: Okay, got it. And then, historically, if I remember correctly, you've given us kind of a number on the value of your pipeline. Are you able to provide those numbers?

Destiny Buch: And then I think, historically, if I remember correctly, you've given us kind of a number on the value of your pipeline. Are you able to provide those numbers? Yeah, so I think what we have the destiny what we try to do going forward is more focused on the recognized revenue, the actual revenue that we are able to generate out of those bookings. But if you just think about the pipeline, right now the number is about 16 million plus in pipeline, but this number continuously keeps evolving. It keeps adding and in remote and being removed. But if you just zoom out and think about the possible, the way from we think about growing, and this 16 plus million does not include the cross-sell and upsell opportunities.

Speaker Change: Okay, got it. And then I think historically, if I remember correctly, you've given us kind of a number on the value of your pipeline. Are you able to provide those numbers?

Hadi Chaudhry: Yeah, so I think what we have, and the thing that we're trying to do going forward is more focused on the recognized revenue, the actual revenue that we are able to generate out of those bookings. But if you just think about the pipeline, right now, the number is about 16 million plus in pipeline, but this number continuously keeps evolving; it keeps adding and being removed.

Destiny Buch: Yeah, so I think what we have, Destiny, what we've tried to do going forward is more focused on the recognized revenue, the actual revenue that we are able to generate out of those bookings. But if you just think about the pipeline, right now, the number is about 16 million plus in pipeline, but this number continuously keeps evolving; it keeps adding and removing and being removed. But over, if you just zoom out and think about the possible, the way we think about growing, and this 16 plus million does not include the cross-sell and upsell opportunities.

Speaker Change: Yeah, so I think what we have, the thing that we try to do going forward is more focused on the recognized revenue, the actual revenue that we are able to generate out of those bookings.

Hadi Chatterji: We will share more details on our growth strategy during our next earnings call.

Speaker Change: But if you just think about the pipeline, right now the number is about 16 million plus in pipeline, but this number continuously keeps evolving. It keeps adding and being removed. But if you just zoom out and think about the possible, the way from we think about growing, and this 16 plus million does not include the cross-sell and up-sell opportunities. This is all from the New Logos perspective. So there's a tremendous opportunity that exists in our existing client base. And that's what I mentioned that this year, year-to-date booking numbers is almost doubled from cross-sell up-sell compared to the same time last year. And even on the recognized revenue basis, it's 50 we expect this year to be.

Stephen Schneider: I will now turn the floor over to Steve. Good morning, and thank you everyone for joining us on today's call. As a team, we are making great progress at accomplishing our objective of transforming our call structure.

Hadi Chaudhry: However, if you just zoom out and think about the possible, the way we think about growing, and this 16 plus million does not include the cross-sell and up-sell opportunities. This is all from the New Logos perspective, so there's a tremendous opportunity that exists in our existing client base. And that's what I mentioned that this year, year-to-date booking numbers have almost doubled from cross-sell and up-sell compared to the same time last year.

Destiny Buch: This is all from the New Logos perspective. So there's a tremendous opportunity that exists in our existing client base. And that's what I mentioned that this year, year to date booking numbers are almost doubled from cross-sell and upsell compared to the same time last year. And even on the recognized revenue basis, it's 50. We expect this year to be from the first half of the year of bookings, the recognized revenue to be 50% higher than the same time last year. So I won't count too much on that pipeline number.

Stephen Schneider: With this transformation, we are achieving our goal of increasing our free cash flow, which will enable us this year to eliminate the entire balance on our credit line, which was 10 million at the start of the year, and move us closer to resuming dividends. Our revised call structure will position us to further expand margins, as within heavily into revenue growth during 2025 and beyond. Over the last three quarters, we have identified more than 26 million in annualized cost savings. Of this 26 million in savings, we expect to realize a reduction to our 2024 in-year expenses of approximately $20 million.

Destiny Buch: This is all from the new logo's perspective. So there's a tremendous opportunity that exists in our existing client base. And that's what I mentioned: that this year, year-to-date booking numbers is almost doubled from cross sell upsell compared to the same time last year. And even on the recognized revenue basis, it's 50% to expect this year to be from the first half of the years of the booking. The recognized revenue to be 50% higher than the last year same time. So I won't count too much on that on that pipeline number. I think if we look at it from the revenue growth perspective, the recognized revenue perspective, that's weird.

Hadi Chaudhry: And even on the recognized revenue basis, we expect this year to be, from the first half of the year of booking, 50% higher than the same time last year. So I won't count too much on that pipeline number. I think if we look at it from the revenue growth perspective, the recognized revenue perspective, that's where I would give more focus.

Speaker Change: from the first half of the years of the booking, the recognized revenue to be 50% higher than the last year same time.

Hadi Chaudhry: I think if we look at it from the revenue growth perspective, the recognized revenue perspective, that's where I would give more focus. Okay, okay, got it. And then when you talk about Cirrus AI and the initial users, what is the size? What is the size of those users?

Speaker Change: So I won't count too much on that on that pipeline number I think if we look at us from the revenue growth perspective the recognized revenue perspective That's that's where I would give more focus to

Destiny Buch: I would give more focus too.

Destiny: Okay, okay. And then when you talk about Cirrus AI and the, I don't want to call it a beta launch, but the initial users, what is the size of those users? And based on your learnings and early adopter feedback, what would be some of the areas you would deploy AI next?

Destiny Buch: Okay. Okay, got it.

Destiny Buch: And then when you talk about CRSAI and the, I don't want to call like a beta launch, but the initial users, what is the size? What are the sizes of those users? And based on your learnings and early adopter feedback, what would be some of the areas you would deploy AI next? Sure. And so we have, as I mentioned, we pushed it to a couple hundred, I would say, the existing users, and there are the initial interest for its coupled dozen at the moment, who have signed up for over the 30 days with pre-trial.

Stephen Schneider: We are achieving these savings through a three-pronged strategy. First, we are strategically deploying our proprietary technology, enabling us to reduce costs while accomplishing day-to-day tasks in a more systematic, effective, and repeatable manner. Second, we have continued to reduce our alliance on third-party contractors, leveraging our in-house expertise at a small fraction of the cost of the prior third-party contractor costs, while also increasing our control, and reducing the natural risks that come with relying on third parties to handle critical business functions.

Speaker Change: Okay, okay, got it. And then when you talk about Cirrus AI,

Speaker Change: and the, I don't want to call it like a beta launch, but the initial users, what is the size? What are the size of those users? And based on your learnings and early adopter feedback, what would be some of the areas you would deploy AI next?

Hadi Chaudhry: Sure. And so we have, as I mentioned, pushed it to a couple hundred, I would say, existing users, and there is initial interest from a couple dozen at the moment who have signed up for our 30 days risk free trial. And we still have to do some work in terms of convincing the client about the real value of AI and adoption. So we launched two products from the front end perspective. One was the Cirrus AI Guide, which basically recommends the procedure and the diagnosis.

Destiny Buch: And based on your learnings and early adopter feedback, what would be some of the areas you would deploy AI next? Sure. And so we have, as I mentioned, pushed it to a couple hundred existing users, and there is initial interest for a couple dozen at the moment who have signed up for our 30 days risk-free trial. And we still have to do some work in terms of convincing the client about the real value of the AI and adoption.

Speaker Change: Sure. And so we have, as I mentioned, we pushed it to...

Speaker Change: Couple hundred I would say the existing users and there are the initial interest for a couple dozen at the moment who have signed up for our

Destiny Buch: So we launched two products from the front end perspective; one was the Cirrus AI Guide, which basically recommends the procedure and the diagnosis, and the other product was Cirrus AI Notes, which basically listened to the dialogue between patients and the doctors and converted that into a chart. So the next product that we are working on next is, and that's also actually something that we just recently rolled out to at least one of the providers, which is going to provide the best of both worlds. So that's similar to Cirrus AI Notes; it will listen to the conversation, and that conversation then gets converted into the recommended course.

Destiny Buch: And we still have to do some work in terms of convincing the clients for the real value of the AI and the adoption.

Speaker Change: the 30 days risk free trial. And we still have to do some work in terms of convincing the client for the real value of the AI and the adoption. So we launched two products from the front end perspective. One was the Cirrus AI Guide, which basically recommends the procedure and the diagnosis. And this other product was Cirrus AI Nose, which basically listened to the dialogue between patients and the doctor and converts that into a chart. So the next product that we are working on next is, and that's also actually we just recently rolled out to at least one of the providers, which is going to provide the best of the both worlds. So that's similar to Cirrus AI Nose, it will listen to the conversation.

Hadi Chaudhry: And this other product was Cirrus AI Nodes, which basically listened to the dialogue between patients and the doctor and converted that into a chart. So the next product that we are working on next is, and that's also actually, we just recently announced it, is the Cirrus AI Guide. And this is the product that has recently been rolled out to at least one of the providers, which is going to provide the best of both worlds.

Stephen Schneider: Third, we have leaned further into our core strength of our global business model. Strategically leveraging our most effective and cost-efficient resource for each discrete process, thereby enabling us to both increase our overall bandwidth while simultaneously reducing the associated costs.

Destiny Buch: So we launched two products from the front-end perspective. One was the CRSAI guide, which basically recommends the procedure and the diagnosis. And this other product was CRSAI notes, which basically listened to the dialogue between patients and the doctor and can work that into a chart. So the next product that we are working on next is, and that's also actually, we just recently rolled out to at least one of the providers, which is going to provide the best of both worlds. So that's similar to CRSAI notes; it will listen to the conversation. And that conversation then gets converted into the recommended course.

Stephen Schneider: In summary, this cost transformation has been made possible through our use of care clouds proprietary technology, eliminating expensive third-party relationships, and embracing the strength of our global model. During the first half of 2024, we were pleased to realize significantly improved year-over-year free cash flow, and a large increase in cash provided from operations. And we turned our gap net income from negative deposited for the first time in two years. Our teams' decisive actions are beginning to yield fruit, and we are excited to see that our financial transformation is well underway.

Hadi Chaudhry: So that's similar to Cirrus AI Nodes; it will listen to the conversation, and that conversation then gets converted into the recommended course. So we just tried to merge the two applications together to provide true value. So think about it, a patient and a doctor talking to each other; it extracts the information and, based on the prior social history and the historical care plans, also at the same time recommends and converts that dialogue into not only just the chart but the suggested diagnosis and procedure course.

Destiny Buch: So we just try to merge the two applications together to provide the true value. So think about it, a patient doctor talking to each other; it extracts the information, and then based on the prior social history and the historical care plans, also at the same time recommends and converts their dialogue in not only just the chart, but the suggested diagnosis and procedure codes. So that's the next thing we already had started to roll out is just our first provider who started to use it on the test basis. The same user base who will sign up for our Care Cloud Notes, that would be our first set of clients who will be updated to this new version.

Stephen Snyder: and Stephen Snyder. So, we have a conversation, and that conversation then gets converted into the recommended course. So, we just try to merge the two applications together to provide the true value. So, think about it, a patient-doctor talking to each other, it extracts the information, and then based on the prior social history and the historical care plans, also at the same time recommends and converts that dialogue in not only just the chart, but the suggested diagnosis and procedure course.

Hadi Chaudhry: So we just tried to merge the two applications together to provide true value. So just think about it, a patient and a doctor talking to each other; it extracts the information, and then, based on the prior social history and the historical care plans, also at the same time recommends and converts that dialogue into not only just the chart but the suggested diagnosis and procedure course. So that's the next step we already have started to roll out. It is just our first provider who has started to use it on a trial basis.

Stephen Schneider: On a separate front, as we have communicated before, we distributed a special proxy to all series A preferred shareholders, recommending the approval of certain important changes to the terms of our series A preferred stock. If approved, holders of Series A preferred stock would be placed on a more equal footing with Series B shareholders, having similar protections in the event of a change of control and equivalent dividend rights. Further, the company would have the right to exchange common stock for Series A preferred shares as more fully described in the proxy materials that we filed with the SEC.

Hadi Chaudhry: The same user base who will sign up for our Care Cloud Notes will be our first set of clients who will be updated to this new version. Okay, all right, got it. And then one last one, I promise.

Hadi Chaudhry: So that's the next step we already have started to roll out is just our first provider who has started to use it on a trial basis. The same user base who will sign up for our Care Cloud Nodes will be our first set of clients who will be updated to this new version.

Stephen Snyder: So that's the next that we already have started to roll out, it's just our first provider who has started to use it on the test basis. The same user base who will sign up for our Care Cloud nodes, that will be our first set of clients who will be updated to this new version.

Destiny: Okay, all right, got it. And then one last one, I promise. How does M&A kind of fit into your growth strategy in 2025? It sounds like most of the growth is going to be organic, but is there any part of that strategy that is dedicated to M&A?

Destiny Buch: Okay, all right, got it. And then one last one I promise.

Destiny Buch: How does M&A kind of fit into your growth strategy in 2025? It sounds like most of the growth is going to be organic, but is there any part of that strategy that is dedicated to M&A? Good question, Destiny.

Destiny Buch: How does M&A kind of fit into your growth strategy in 2025? It sounds like most of the growth is going to be organic. But is there any part of that strategy that is dedicated to M&A? Good question, Destiny. As we think about growth as we pivot into full growth mode in 2025, we think the majority of that overall growth will come from expanding the existing wallet share of our existing customers. And then new partnerships, which you mentioned before. So we have today about 25 partnerships, reseller relationships, primarily with medical billing companies. But we have the opportunity to be able to sell into those existing relationships, things like Force, which helps them augment the resource and other solutions like CCM and the like.

Speaker Change: Okay, all right, got it. And then one last one, I promise. How does M&A kind of fit into your growth strategy in 2025? It sounds like most of the growth is going to be organic, but is there any part of that strategy that is dedicated to M&A?

Stephen Snyder: Good question, Destiny. As we think about growth, as we pivot into full growth mode in 2025, we think the majority of that overall growth will come from expanding the existing wallet share of our existing customers and then through partnerships, which you mentioned before. So we have today about 25 partnerships, reseller relationships, primarily with medical billing companies, but we have the opportunity to be able to sell into those existing relationships, things like Force Force, which helps them augment their workforce and other solutions like CCM and the like.

Stephen Snyder: As we think about growth, as we pivot into full growth mode in 2025, we think the majority of that overall growth will come from expanding the existing wallet share of our existing customers and then through partnerships, which you mentioned before. So we have today about 25 partnerships, reseller relationships, primarily with medical billing companies, but we have the opportunity to be able to sell into those existing relationships, things like Force Force, which helps them augment their workforce and other solutions like CCM and the like. So, in terms of being able to take those partnerships and expand those existing partnerships and also to develop other partnerships with other billing companies, primarily. There are roughly 1,500 billing companies in the U.S.

Stephen Schneider: The initial response of the Series A preferred shareholders has been overwhelming and unambiguous. More than 85% of proxies returned the date have been in favor of the amendments. The support has been shared by Glass-Louis, a leading proxy vote advisory firm that analyzed our proposal and recommended that shareholders vote for the changes.

Speaker Change: Good question, Justin. As we think about

Stephen Schneider: While the level of support has been strong, we still need the affirmative vote of at least two-thirds of all outstanding shares. A challenge for even a popular proposal like this one, given a fragmented retail ownership base.

Speaker Change: Growth as we pivot into

Speaker Change: into full growth mode in 2025.

Speaker Change: We think the majority of that overall growth will come from expanding the existing wallet share of our existing customers, and then through partnerships, which you mentioned before. So we have today about 25 partnerships, reseller relationships, primarily with medical billing companies.

Speaker Change: But we have the opportunity to be able to sell into those existing relationships, things like force force, which helps them augment their force and other solutions like CCM and the like.

Stephen Schneider: Therefore, we encourage Series A preferred shareholders to take the time to read the proxy materials and then let their voices be heard.

Destiny Buch: So, in terms of being able to take those partnerships and expand with existing partnerships and also to develop other partnerships with other billing companies, primarily, there are 1,500 roughly billing companies in the US. So we think there's a significant opportunity to be able to partner with them to enable them to be a reseller of our software. And then also to be able to empower them with our force augmentation so that they can grow in their space and become increasingly profitable. To your questions, though, in particular with regard to acquisitions, we really do see kind of within this partnership within this kind of billing company partnership area.

Stephen Snyder: So in terms of being able to take those partnerships and expand those existing partnerships and also to develop other partnerships with other billing companies primarily, there are 1,500 billing companies in the US. So we think there's a significant opportunity to partner with them, to enable them to be a reseller of our software, and then also to be able to empower them with our force augmentation so that they can grow in their space and become increasingly profitable.

Speaker Change: So...

Speaker Change: In terms of being able to take those partnerships and expand those existing partnerships and also to develop other partnerships with with other billing companies primarily. There are 1,500 roughly billing companies in the US

Norman Roth: I'll now turn the floor over to our insurance GFO, nor Roth. Norm? Thanks, Steve, and thank you all for joining our call today. I would like to start by talking about our positive gap net income and cash flow, which I am sure are welcome news for investors. Second quarter of 2024 was our first quarter with positive gap net income since 2022. During the six months and the June 30th, 2024, we generated $8.3 million of cash from operations and $4.9 million of free cash flow.

Stephen Snyder: So we think there's a significant opportunity to be able to partner with them, to enable them to be a reseller of our software and then also to be able to empower them with our force augmentation so that they can grow in their space and become increasingly profitable. To your question though in particular with regard to acquisitions, we really do see kind of within this partnership, within this kind of billing company partnership area, we see the opportunity to maybe not engage in traditional kind of traditional acquisitions, but to engage in some quasi acquisitions, by which I mean to really enable them to provide our software, to leverage our team and to really revolutionize their current construct, their current business model in such a way that in many respects, we have the benefits of the acquisition from a revenue perspective and from a cashflow perspective without actually doing a traditional purchase of the stock.

Speaker Change: So we think there's a significant opportunity to be able to partner with them.

Speaker Change: to enable them to be a reseller of our software.

Speaker Change: and then also to be able to empower them with our

Speaker Change: Force augmentation so that they can can grow in their space and become increasingly profitable

Stephen Snyder: To your question, though, in particular with regard to acquisitions, we really do see kind of within this partnership, within this kind of billing company partnership area, we see the opportunity to maybe not engage in traditional acquisitions but to engage in some quasi-acquisitions, by which I mean to really enable them to provide our software, to leverage our team, and to really revolutionize their current construct, their current business model in such a way that, in many respects, we have So we'll see as the year unfolds, but we're really committed to continuing to expand free cashflow as the year progresses, and then any of our growth will really be first and foremost really concentrated on opportunities that we can pursue in a manner that allows us to continue to expand cashflow. Okay.

Destiny: Okay, got it. Thank you for all that information. I'm going to go ahead and get back in queue now.

Operator: The next question is from Allen Klee with Maxim Group. Please go ahead.

Speaker Change: To your question, though, in particular with regard to acquisitions, we really do see kind of within this, within this partnership, within this kind of building company partnership area.

Norman Roth: We were able to use the profits and cash flows we generated to repay 75% of the balance on our Silicon Valley bank line of credit as of today. As of June 30th, 2024, we had repaid $5 million of the January 1 balance on our line of credit. Since June 30th, we repaid an additional $2.5 million, bringing the balance from $10 million on January 1 of this year to $2.5 million today. This means we have much more financial flexibility.

Destiny Buch: We see the opportunity to maybe not engage in traditional kind of traditional acquisitions, but to engage in some quasi acquisitions, by which I mean to really enable them to provide our software.

Speaker Change: We see the opportunity to maybe not engage in traditional acquisitions, but to engage in some quasi-acquisitions, by which I mean to really enable them to

Destiny Buch: To leverage our team and to really revolutionize their current construct, the current business model in such a way that, in many respects, we have the benefits of the acquisition from a revenue perspective and from a cash flow perspective without actually doing traditional purchase of the stock. So we'll see as the year unfolds, but we're really committed to continuing to expand free cash flow as the year progresses, and then any of our growth will really be first and foremost, really concentrated on opportunities that we can pursue in a matter that allows us to continue to expand cash flow.

Speaker Change: provide our software to leverage our team and to really revolutionize their current construct, their current business model, in such a way that in many respects

Norman Roth: In the second quarter, we reported revenues of $28.1 million while down $1.3 million year over year, $1 million of the decline was due to MedisR, which is a project-based professional services business that tends to fluctuate. MedisR has had softness since the second half of last year, which is continuing, but we are hopeful that we will see some growth in the second half of 2024. However, Care Cloud Wellness generated over $1 million in revenue for the first time this quarter and is up by $1.1 million for the first six months this year compared to 2023.

Speaker Change: We have the benefits of the acquisition from a revenue perspective and from a cash flow perspective without actually doing a traditional purchase of the stock.

Stephen Snyder: So we'll see as the year unfolds, but we're really committed to continuing to expand free cashflow as the year progresses. And then any of our growth will really be first and foremost to really concentrate it on opportunities that we can pursue in a manner that allows us to continue to expand cashflow. Okay, got it. Thank you for all that information. I'm going to go ahead and get back in queue now.

Speaker Change: So, we'll see as the year unfolds, but we're really committed to continuing to expand free cash flow as the year progresses and then any of our growth will really be first and foremost really concentrated on opportunities that we can pursue in a manner that allows us to continue to expand cash flow.

Destiny Buch: Okay, got it. Thank you for all that information.

Destiny Buch: I'm going to go ahead and get back in queue now. Thanks. Thank you.

Speaker Change: Okay, got it. Thank you for all that information. I'm going to go ahead and get back in queue now. Thanks.

Norman Roth: Our direct operating costs continue to decline and they are down by nearly $2.2 million from Q2 2023. D. Our operating expenses, including GNA, R&D, and sales and marketing expenses, decreased by $2.9 million. On an annual run rate basis, these operating expenses are already down over $20 million since Q1 2023. In the second quarter, we reported positive gap operating income of $2.3 million and gap net income of $1.7 million, both the highest amounts since Q2 2022.

Alan Cleave: The next question is from Alan Cleave with Maxim Group. Please go ahead. Yes, good morning. Great, great execution.

Destiny Buch: Thanks. Thank you. The next question is from Allen Klee with Maxim Group. Please go ahead.

Speaker Change: Thank you. Thank you.

Speaker Change: The next question is from Alan Klee with Maxim Group. Please go ahead.

Allen Klee: Yes, good morning. Great execution. Can we start on MedSR? You mentioned continued softness, some hope for growth in the second half. What's the state of the market there? Is it a competitive environment where some parties are not allowed to use you? Or where do you see the potential to maybe turn things around?

Allen Klee: Yes, good morning. Great, great execution.

Alan Cleave: Can we start on Med SR? You mentioned continued softness. Some hope for growth in the second half. What's the state of the market there? Is it the competitive environment that some parties are not allowed to use you or where do you see the potential to maybe turn things around? Thanks.

Alan Klee: Yes, good morning. Great, great execution. Can we start on MedSR? You mentioned continued softness.

Allen Klee: Can we start on MedSR? You mentioned continued softness, some hope for growth in the second half. What's the state of the market there? Is it a competitive environment where some parties are not allowed to use you? Or where do you see the potential to maybe turn things around?

Alan Klee: Some hope for growth in the second half.

Alan Klee: What's the state of the market there? Is it the competitive environment that...

Speaker Change: that some parties are not allowed to use you or where do you see the potential to maybe turn things around? Thanks.

Hadi Chatterji: Thank you, Allen. Good morning. So you're right. I think the industry of the health system, as you all know, is still continuing to be dominated by at least one, one stakeholder and the rest of the market shares between the next two or three other, other vendors. So we continue to work and expand the relationship with the, with the second, the second and the third into the, in the industry in the market. When it comes to the first, the dominated player in the market, we still only can do a small piece of the overall services that we could have offered for the other smaller market shareholders.

Allen Klee: Thanks.

Hadi Chaudhry: Thanks. Thank you, and good morning. So you're right, I think that the health system industry, as we all know, is still dominated by at least one stakeholder, and the rest of the market shares are between the next two or three other vendors. So we continue to work and expand the relationship with the second, the second, and the third players in the market.

Norman Roth: This compares to a gap operating loss of $1.3 million and a gap net loss of $1.8 million during Q2 2023. The gap nut loss per share was 14 cents based on the net loss attributable to common shareholders, which takes into account the preferred stock dividends earned, whether or not they were declared or paid during the quarter.

Speaker Change: Thank you and good morning.

Hadi Chaudhry: Thank you, Allen. Good morning.

Speaker Change: So you're right. I think the industry of the health system, as we all know, is still continuing to be dominated by at least one stakeholder and the rest of the market shares between the next two or three other vendors. So we continue to work and expand the relationship with the second and the third in the industry in the market. When it comes to the first the dominated player in the market, we still only can do a small piece of the overall

Hadi Chaudhry: So you're right, I think that the industry of the health system, as we all know, is still dominated by at least one stakeholder, and the rest of the market shares are between the next two or three other vendors. So we continue to work and expand the relationship with the second, the second, and the third players in the industry in the market. When it comes to the first, the dominant player in the market, we can still only offer a small piece of the overall services that we could have offered to the other smaller market share vendors.

Hadi Chaudhry: When it comes to the first, the dominant player in the market, we can still only offer a small piece of the overall services that we could have offered to the other smaller market share vendors. And that one, we started to try to earn that business since it was completely stopped for us for the last two years. So getting back on track is realistically going to take some time because the projects are already signed and in progress.

Norman Roth: This requires a little explanation. Even though by definition, gap net income is always shown before dividends, and only dividends which have been declared by our board of directors are recorded on the balance sheet, the gap net loss per common share calculation reflects the dividends that accumulate monthly, whether or not these dividends were declared or paid. Non-gap adjusted net income for the second quarter of 2024 was $3 million or 18 cents per share calculated using the end-of-period common share as outstanding.

Hadi Chaudhry: And that one, we started to try to earn that business since it was completely stopped for us for the last two years. So getting back on track is that it's realistically going to take some time because the projects are already signed and in the works. So someone who is looking to get a new project started, by the time we even sign up and start to recognize revenue, it's going to take a couple of months before we can earn that.

Hadi Chatterji: And that one we started to try to earn that business since it was completely stopped for us for the last two years. So getting back on track is that it's realistically going to take some time because the projects are already signed and it works. So someone who is looking to get a new project started by the time we even sign up and start to recognize the revenue. It's going to take us a couple of months before we can, we can earn that.

Speaker Change: services that we could have offered for the other smaller market chairmenders. And that one, we started to try to earn that business since it was completely stocked for us for the last two years. So getting back on track is it's realistically going to take some time because the projects are already signed and in works.

Hadi Chaudhry: So someone who is looking to get a new project started, by the time we even sign up and start to recognize revenue, it's going to take us a couple of months before we can earn that. But overall, the bigger picture for Medisar, how we think we can grow into that space, which is to continue to leverage our technology-enabled RCM solutions and some of these, whether it's AI-based tools or tools or our BI solutions, how we can cross sell and upsell into that Medisar space. So we continue to, we will continue, and continue to push towards that. And the second thing is expanding our relationship to the second and the third, after the first, the largest market order.

Speaker Change: So someone who is looking to get a new project started by the time we even sign up and start to recognize the revenue, it's going to take us a couple of months before we can earn that. But overall, the bigger picture for Medisar, how we think we can grow into that space, which is continue to leverage our technology-enabled RCM solutions and some of these, whether it's an AI-based tools or tools or our BI solutions, how we can cross-sell and up-sell into that Medisar space. So we continue to, we will continue and continue to push towards that. And the second thing is expanding our relationship to the second and the third, after the first, the largest marketer order.

Hadi Chaudhry: But overall, the bigger picture for Medisar, how we think we can grow into that space, which is to continue to leverage our technology-enabled RCM solution, then some of these, whether it's AI-based tools or tools or our BI solutions, how we can cross sell and upsell into that Medisar space. So we continue to, we will continue, and we will continue to push towards that. And the second thing is expanding our relationship to the second and the third, after the first, the largest market order.

Norman Roth: We reported adjusted EBITDA of $6.4 million in the second quarter compared to $3.8 million in the same period last year. This is our highest adjusted EBITDA since the second quarter of 2022. Revenue for the first six months of 2024 was $54.1 million compared to $59.4 million in the first six months of 2023. Of the $5.3 million decline, $3.3 million was attributable to Metastar. For the first six months of 2024, the company's gap net income was $1.4 million compared to a gap net loss of $2.2 million in the first six months of 2023.

Hadi Chatterji: But overall, bigger picture for medicine, how we think we can grow into that space, which is continuing to leverage our technology enabled RCM solution than some of these, whether it's an AI base tools or tools or our BI solutions, how we can cross sell and upsell into that medicine. So we continue to, we will continue and then continue to push towards that. And the second thing is expanding our relationship to the second and the third after the first, the largest market order. Thank you.

Hadi Chaudhry: Thank you. And then you had positive commentary on remote patient monitoring of wellness overall. Is that growing as it just takes longer with existing customers to get set up where then they can get patients compliant and billing, or is it also from like expanding the number of customers? Wait. No, no, no.

Hadi Chaudhry: And then you had positive commentary on remote patient monitoring and wellness overall. Is that growing as it just takes longer with existing customers to get set up where then they can get patients compliant and billing, or is it also from like expanding the number of customers? And then actually, it's a combination of both, and as we have evolved over the last roughly two years now into this year and a half, two years now for this chronic care management and remote patient monitoring.

Speaker Change: Thank you. And then you had positive commentary on remote patient monitoring wellness overall.

Norman Roth: This equates to a loss of $0.24 per share after subtracting the first stock dividends earned but not declared or paid. Non-gap adjusted net income for the first half of 2024 was $3.2 million or 20 cents per share. Year-to-date adjusted EBITDA was $10.1 million and increased of $2 million from $8.1 million in the same period last year. As of June 30, 2024, the company had approximately $2.6 million of cash. Networking capital was $674,000 and we had $5 million drawn on our line of credit.

Speaker Change: Is that growing as it just takes longer with existing customers to get set up where we're then make they can

Speaker Change: get patients compliant and billing? Or is it also from like expanding the number of customers? Thanks.

Hadi Chatterji: Thanks. And in an actually it's a combination of both, and as we evolved over the last roughly two years now, into this year and a half, two years now for this chronic in management and remote patient monitoring. So, as an example, now recently we have started to launch over internal the next generation platform for remote patient monitoring and chronic care management. So, so now we started to leverage other mayors to engage the patient instead of just calling the patient. So, in addition to calling the patient now, we're also trying to engage them through text messages, through emails, sending them the training videos, sending them the different type of text messages, which whenever the patient has the time can click on it and fill up the forms, and then our care managers get involved.

Hadi Chaudhry: And then actually, it's a combination of both, as we have evolved over the last roughly two years now into this year and a half, two years now for this chronic care management and remote patient monitoring. So, as an example, recently we have started and launched our internal, the next generation platform for remote patient monitoring and chronic care management. So now we have started to leverage other mayors to engage the patient instead of just calling the patient.

Speaker Change: And actually it's a combination of both. And as we evolved over the last roughly two years now into this year and a half, two years now for this chronic care management and remote patient monitoring. So as an example, now recently we have started, we launched our internal, the next generation platform for the more patient monitoring and chronic care management.

Hadi Chaudhry: So as an example, recently we have started, and we launched our internal, the next generation platform for remote patient monitoring and chronic care management. So now we have started to leverage other measures to engage the patient instead of just calling the patient. So in addition to calling the patient now, we are also trying to engage them through text messages, through email, sending them training videos, sending them different types of text messages which, whenever the patient has time, they can click on and fill out the forms, and then our care managers get involved.

Norman Roth: As previously stated, since June 30, we repaid an additional $2.5 million on the line, bringing the balance to $2.5 million today. Now that we are not dependent on our SBB line of credit, the company is considering reducing the total size of the line of credit from $25 million to $10 million. This would save us fees on the unused portions of the line. Dean, but still provide the company with ample liquidity in the event there is a cash need. The second quarter results puts us on a good footing for the year ahead, we're happy to have returned to profitability and look forward to updating you later in the year.

Speaker Change: So now we started to leverage other measures to engage the patient instead of just calling the patient. So in addition to calling the patient now, we are also trying to engage them through text messages, through email, sending them the training videos, sending them the different type of text messages which whenever the patient has the time can click on it and fill up the forms and then our care managers get involved. So we have overall improved the way we are approaching and trying to engage the patients.

Hadi Chaudhry: So in addition to calling the patient now, we are also trying to engage them through text messages, through email, sending them training videos, sending them different types of text messages, which whenever the patient has time, they can click on and fill out the forms, and then our care managers get involved. So we have overall improved the way we approach and try to engage the patients. So one, it will, yes, even increase the existing patient adoption rate from the existing clients who have already started to take this service from us.

Hadi Chaudhry: So we have overall improved the way we are approaching and trying to engage the patients. So one, it will, yes, even increase the existing patient adoption rate from the existing clients who have already started to take this service from us. And the second thing, expanding chronic care management in our existing client base and doing new sales in our existing client base. In terms of the new logos, we do try to pitch those to external clients, but this becomes a secondary nature.

Hadi Chatterji: So we are overall improved the way we are approaching and trying to engage the patients. So one, it will yes even increase the existing patient adoption from the existing clients who already have started to take the service from us. And the second thing expanding in our existing client base, the chronic care management design, doing the new sales in our existing, existing client base in terms of the new logos. We do try to pitch those to the external clients, but this becomes a secondary nature with the help of this. Another hope we try to always sign up for the overall technology-enabled solution, RCM plus ASS solution, and then also provide this chronic care management and remote patient monitoring service.

Speaker Change: So, one, it will, yes, even increase the existing patient adoption from the existing clients who already have started to take this service from us. And the second thing, expanding in our existing client base, the chronic care management, doing the new sales in our existing client base. In terms of the new logos, we do try to pitch those to the external clients. Thank you.

Mahmud Haq: With that, I'll turn the call over to Mahmud for his closing remarks. Mahmud? Thank you, Norm. We are very pleased with the great improvement and profitability that we have achieved. Our primary focus is on creating long-term value for our shareholders.

Hadi Chaudhry: And the second thing, expanding our existing client base, the chronic care management, and doing new sales in our existing client base. In terms of the new logos, we do try to pitch those to external clients, but this becomes secondary. With the help of this and other hope, we try to always sign up for the overall technology-enabled solution, RCM plus SAV solution, and then also provide this chronic care management and remote patient monitoring service. Because for us, the best thing would be to sign up our customers for the full end-to-end services that we can offer, chronic care management and remote patient monitoring being one part of it.

Mahmud Haq: I would like to thank our employees, our customers and shareholders for their continuous support in furthering CareCloud's mission. Operator, please open the floor for questions. Thank you.

Hadi Chaudhry: With the help of this and other hope, we try to always sign up for the overall technology-enabled solution, RCM plus SAV solution, and then also provide this chronic care management and remote patient monitoring service. Because for us, the best thing would be to sign up our customers for the full end-to-end services that we can offer, chronic care management and remote patient monitoring being one part of it. Thank you. The last question on CareCloud is from Sears AI.

Speaker Change: This becomes a secondary nature. With the help of this and other hope, we try to always sign up for the overall technology-enabled solution, RCM plus that solution, and then also provide this chronic care management and remote patient monitoring service. Because for us, the best thing would be to sign up our customer for the full end-to-end services that we can offer, chronic care management and remote patient monitoring being one part of it.

Operator: Ladies and gentlemen, we will now be conducting a question and answer session. If you'd like to ask a question, please press star and one on the telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star and two if you would like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. Ladies and gentlemen, we will wait for a moment while we poll for questions.

Hadi Chatterji: Because for us the best thing would be to sign up our customer for the full end-to-end services that we can offer: chronic care management and remote patient monitoring being one part of it.

Hadi Chatterji: Thank you.

Allen Klee: Thank you. The last question on CareCloud Spheres AI.

Hadi Chatterji: The last question on, um, lab, uh, CareClouds here say, I, um, how, how do you talk a little about how you're thinking about going from, from, from relatively small medical customers to expanding it broader? Um, do you feel you have the, the, the sales infrastructure to do that or how, how would you approach that and is it, how do you feel about the competitive market of, um, affecting decision makers? Thank you.

Speaker Change: Thank you. The last question on Care Cloud Spheres AI.

Allen Klee: How do you, could you talk a little about how you're thinking about going from a relatively small amount of customers to expanding it wider? Do you feel you have the sales infrastructure to do that? Or how would you approach that? How do you feel about the competitive market of Affecting Decision Makers? Thank you.

Hadi Chaudhry: How do you, could you talk a little about how you're thinking about going from a relatively small amount of customers to expanding it wider? Do you feel you have the sales infrastructure to do that? Or how would you approach that?

Speaker Change: How do you talk a little about how you're thinking about going from from from a relatively small amount of customers to expanding it broader? Do you feel you have the the sales infrastructure to do that or how would you approach that?

Allen Klee: is it how do you feel about the competitive market of, Affecting Decision Makers. Thank you. Yes, and if you think about it, until the last, let's say the 30 days or the 60 days before our first challenge for similar to other AI companies was refining the results, focusing on so we, we tried to use our own data and with the help of the AI technology leverage through either Google partnership or, or other players, how we can leverage our own data, plus using the LLMs already provided by whether it's Google or other players.

Jeffrey Cohen: The first question is from Jeffery Cohen with Layden Bogtalman. Please go ahead with the question. Good morning. This is definitely on for Jeff. I just had a few quick questions. Maybe I'll start with your comments around contractors versus in-house. I'm wondering what percentage now of your operations is through contractors and what percentage is now in-house?

Speaker Change: How do you feel about the competitive market of affecting decision makers?

Hadi Chatterji: Yeah, so, so, and if you think about it, we, uh, until the last, let's say, the 30 days on the 60 days before our first challenge for similar to other AI companies was refining their results, uh, focusing on. So, we tried to use our own data and, with the help of the AI technology leveraged through either Google partnership or other players, how we can leverage our own data plus using the LLM's already provided by whether it's Google or other players. So we kept on refining our, uh, our applications and then finally was able to push it out over the, over the last 30 to 45 days to the existing client base.

Hadi Chaudhry: Yes, and if you think about it, until the last, let's say the 30 days or the 60 days before our first challenge, similar to other AI companies, was refining the results, focusing on so we tried to use our own data and, with the help of the AI technology, leverage either Google partnership or, or other players, how we can leverage our own data, plus using the LLMs already provided by whether it's Google or other players. So we kept on refining our applications and then finally were able to push them out over the last 30 to 45 days to the existing client base. Similar to any other service, the solution offering we have, our best opportunity exists with the existing client base. We work with 2600 plus practices and 40,000 providers, including BI solution clients.

Speaker Change: Yes, and if you think about it, we have...

Speaker Change: Until the last, let's say the 30 days or the 60 days before, our first challenge was similar to other AI companies, was refining the results, focusing on, so we tried to use our own data and with the help of the AI technology leveraged through either Google partnership or other players, how we can leverage our own data plus using the LLMs already provided by whether it's Google or other players. So we kept on refining our applications and then finally was able to push it out in the last 30 to 45 days to the existing client base.

Hadi Chatterji: Okay, Stephanie, good morning. Thank you for the question. I just a little clarification that I over to Steve. When we talk about contractors, it was they were one or two very specific contractors on the IT side, which were being used by the care cloud acquisition that we did, the care cloud that's part of us now. It's not that any operational, the RC inside of the thing, there were some very specific niche areas on the technology development style for which we were using the contractors, which took us a little more time than usual to transition to overwork for us.

Allen Klee: So we kept on refining our applications and then finally were able to push them out over the last 30 to 45 days to the existing client base. Similar to any other service or solution offering we have, our best opportunity exists with the existing client base. We work with 2600 plus practices and 40,000 providers, including the BI solution client.

Hadi Chatterji: So in terms of the percent, I'm not sure if Steve or Norm would give any, but it's Steve, if any chance, do you have any specific number for that contractor percent? Not a specific number, but the overwhelming majority of the work being performed is performed by our employees. There's a really minute portion that's being performed destiny by contractors. And as Tommy said, really the contractors that we spoke about were a variety of different subcontractors, some in India, some in Central America and South America that were helping us from an R&D perspective, and they were really a holdover from two prior acquisitions.

Hadi Chatterji: Similar to any other service, uh, another solution offering we have, our best opportunity exists with the existing client base. We work with 2,600 plus practices and 4,000 providers, including the BI solution client. So I think there's a tremendous opportunity that exists to expand into the existing client base. So, uh, and, and I think AI is becoming one of the top line direct revenue drivers. But in addition to that, uh, improving the existing workflows, how the same practice can save time, uh, because now the AI is part of their workflows. Uh, when you use chat, GPD, the same email can be written in, let's say, five seconds compared to two minutes.

Speaker Change: Similar to any other service and other solution offering we have, our best...

Speaker Change: opportunity exists with the existing client base. We work with 2600 plus practices and 40,000 providers, including the BI solution client. So I think there's a tremendous opportunity that exists to expand into the existing client base.

Hadi Chaudhry: So I think there's a tremendous opportunity that exists to expand into the existing client base, and I think AI is becoming one of the top line direct revenue drivers. But in addition to that, improving the existing workflows, how the same practice can save time because now AI is part of their workflows. When you use chat GPT, the same email can be written in, let's say, five seconds compared to two minutes.

Hadi Chaudhry: So I think there's a tremendous opportunity that exists to expand into the existing client base, and I think AI is becoming one of the top line direct revenue drivers. But in addition to that, improving existing workflows, showing how the same practice can save time because now AI is part of their workflows. When you use chat GPT, the same email can be written in, let's say, five seconds compared to two minutes.

Speaker Change: So, and I think AI is becoming one of the top line direct revenue driver, but in addition to that, improving the existing workflows, how the same practice can save time, because now the AI is part of their workflows, when you use chat GPT, the same email can be written in, let's say, five seconds compared to two minutes. But it's not that you will be driving the direct revenue, but the overall workflow will help improve the revenue of the client. And since most of our clients.

Hadi Chatterji: So, but it's not that you will be driving the direct revenue, but the overall workflow will help improve the revenue of the client. And since most of our clients, uh, we charge them on a collection fee of a revenue will increase.

Hadi Chaudhry: So, but it's not that you will be driving direct revenue, but the overall workflow will help improve the revenue of the client. And since most of our clients, we charge them on a collection fee, revenue will increase. So, to answer the question, yes, there is a competitive market out there when you go, go out and try to sell pure AI solutions. But for us, if you think about it, our AI solutions are going to improve transcription, for example, the existing client can take the service, sign up for the service, and the existing EHR system, this solution becomes part of the, part of the existing workflow.

Hadi Chaudhry: So, to answer the question, yes, there is a competitive market out there when you go, go out and try to sell pure AI solutions. But for us, if you think about it, our AI solutions are going to improve transcription, for example, the existing client can take the service, sign up for the service, and the existing EHR system, this solution becomes part of the, part of the existing workflow.

Hadi Chatterji: So, to, to answer the question, yes, there is a competitive market out there when you go, go out and trying to sell pure AI solutions. But for us, if you think about it, our AI solutions is going to improve transcription, as an example. The existing client can take the service, sign up for the service, and the existing EHR system. This solution becomes part of the, uh, part of the existing workflow. So, we think that this is one of the differentiation when you compare us to over competitors out there, where they might need to have a one separate solution, uh, uh, running independently and not fully integrated into their existing platform.

Speaker Change: We charge them on a collection fee of a revenue with increase.

Speaker Change: So, to answer the question, yes, there is a competitive market out there when you go out and try to sell pure AI solutions, but for us, if you think about it, our AI solutions is going to improve transcription as an example. The existing client...

Hadi Chatterji: So as we move forward and we analyze that particular spend, we really came to conclusion that we would be much better off long-term reducing that overall expense, which can with by moving to our in-house experts were able to reduce that expense by about 80, 85 percent roughly, and then also have greater control over the work being performed. So really a positive all the way around. Okay, got it. Yeah, that makes sense.

Hadi Chaudhry: So we think that this is one of the differentiations when you compare us to our competitors out there, where they might need to have one separate solution running independently and not fully integrated into their existing platform.

Speaker Change: can take the service, sign up for the service, and the existing EHR system, this solution become part of the existing workflow. So we think that this is one of the differentiation when you compare us to our competitors out there, where they might need to have a one separate solution running independently and not fully integrated into their existing platform.

Hadi Chatterji: That's pretty. Thank you so much. Thank you.

Allen Klee: That's great. Thank you so much. Thank you. A reminder to all the participants, analysts who wish to ask a question may press star and one on the telephone keypad. May I request that analysts who wish to ask a question may press star and one on the telephone keypad.

Allen Klee: That's great. Thank you so much.

Speaker Change: That's great. Thank you so much.

Operator: Thank you. As there are no further questions, I would now like to hand the conference over to Norman Roth for closing remarks. Thank you, everyone, for attending our conference today. Have a great day. Thank you. This concludes today's teleconference. You may disconnect your lines.

Operator: A reminder to all the participants: Analysts who wish to ask a question may press star n1 on the telephone keypad. May request analyst who wish to ask a question, may press star n1 on the telephone keypad. Thank you.

Operator: A reminder to all the participants, analysts who wish to ask a question may press star and one on the telephone keypad. May I request that they press star and one on the telephone keypad. Thank you. As there are no further questions, I would now like to hand the conference over to Norman Roth for closing remarks.

Speaker Change: Thank you.

Speaker Change: A reminder to all the participants, analysts who wish to ask a question may press star and one on the telephone keypad.

Speaker Change: [inaudible]

Speaker Change: May request analyst who wish to ask a question, may press star and one on the telephone keypad. Thank you.

Destiny Buch: Great question, Destiny. So it's both. So one is we already have multiple channel partners who we work with. So they are either acting as a resellers for us or let's say for our care cloud force as an example. So we are there number of these partners we leverage over employees. So there is an inbound interest for expansion based on the different marketing campaigns and then they will be will be spending more doing some more investment towards and outreach for finding additional partners. Okay, got it.

Speaker Change: D.O.T.

Norman Roth: As there are no further questions, I would now like to hand the conference over to Norman Roth for closing remarks. Thank you, everyone, for attending our conference today. Have a great day.

Speaker Change: As there are no further questions, I would now like to hand the conference over to Norman Roth for closing remarks.

Norman Roth: Thank you everyone for attending our conference today. Have a great day!

Norman Roth: Thank you everyone for attending our conference today. Have a great day.

Operator: Thank you.

Operator: Thank you. This concludes today's teleconference. You may disconnect your lines at this time. Thank you for your participation.

Operator: This concludes today's teleconference. You may disconnect your lines at this time. Thank you for your participation.

Norman Roth: Thank you.

Norman Roth: This concludes today's teleconference.

Speaker Change: You may disconnect your lines at this time. Thank you for your participation.

Destiny Buch: And then I think historically if I remember correctly, you've given us kind of a number on the value of your pipeline. Are you able to provide those numbers? Yeah, so I think what we have the destiny what we try to do going forward is more focused on the recognized revenue, the actual revenue that we are able to generate out of those bookings. But if you just think about the pipeline, right now the number is about 16 million plus in pipeline, but this number continuously keeps evolving.

Destiny Buch: It keeps adding and in remote and being removed. But if you just zoom out and think about the possible the way from we think about growing and this 16 plus million does not include the cross sell and upsell opportunities. This is all from the new logo's perspective. So there's a tremendous opportunity that exists in our existing client base. And that's what I mentioned that this year year-to-date booking numbers is almost doubled from cross sell upsell compared to the same time last year.

Destiny Buch: And even on the recognized revenue basis, it's 50% to expect this year to be from the first half of the years of the booking. The recognized revenue to be 50% higher than the last year same time. So I won't count too much on that on that pipeline number. I think if we look at it from the revenue growth perspective, the recognized revenue perspective, that's weird. I would give more focus too. Okay. Okay, got it.

Destiny Buch: And then when you talk about CRSAI and the, I don't want to call like a beta launch, but the initial users, what is the size? What are the size of those users? And based on your learnings and early adopter feedback, what would be some of the areas you would deploy AI next?

Hadi Chatterji: Sure. And so we have, as I mentioned, we pushed it to a couple hundred, I would say, the existing users, and there are the initial interest for its coupled dozen at the moment, who have signed up for over the 30 days with pre-trial. And we still have to do some work in terms of convincing the clients for the real value of the AI and the adoption.

Hadi Chatterji: So we launched two products from the front-end perspective. One was the CRSAI guide, which basically recommends the procedure and the diagnosis. And this other product was CRSAI notes, which basically listened to the dialogue between patients and the doctor and can work that into a chart. So the next product that we are working on next is, and that's also actually, we just recently rolled out to at least one of the providers, which is going to provide the best of the both worlds.

Hadi Chatterji: So that's similar to CRSAI notes, it will listen to the conversation. And that conversation then gets converted into the recommended course. So we just try to merge the two applications together to provide the true value. So think about it, a patient doctor talking to each other, it extract the information, and then based on the prior social history and the historical care plans, also at the same time recommends and converts their dialogue in not only just the chart, but the suggested diagnosis and procedure codes.

Hadi Chatterji: So that's the next thing we already had started to roll out is just our first provider who started to use it on the test basis. The same user base who will sign up for our care cloud notes, that would be our first set of clients who will be updated to this new version.

Destiny Buch: Okay, all right, got it.

Destiny Buch: And then one last one I promise.

Destiny Buch: So we have today about 25 partnerships reseller relationships, primarily with medical billing companies. But we have the opportunity to be able to sell into those existing relationships, things like force, which helps them augment the resource and other solutions like CCM and the like. So in terms of being able to take those partnerships and expand with existing partnerships and also to develop other partnerships with other billing companies, primarily, there are 1500 roughly billing companies in the US.

Destiny Buch: So we think there's a significant opportunity to be able to partner with them to enable them to be a reseller of our software. And then also to be able to empower them with our force augmentation so that they can grow in their space and become increasingly profitable. To your questions, though, in particular with regard to acquisitions, we really do see kind of within this within this partnership within this kind of billing company partnership area.

Destiny Buch: We see the opportunity to maybe not engage in traditional kind of traditional acquisitions, but to engage in some quasi acquisitions by which I mean to really enable them to provide our software. To leverage our team and to really revolutionize their current construct, the current business model in such a way that in many respects, we have the benefits of the acquisition from a revenue perspective and from a cash flow perspective without actually doing traditional purchase of the stock.

Destiny Buch: So we'll see as the year unfolds, but we're really committed to continuing to expand free cash flow as the year progresses and then any of our growth will really be first and foremost, really concentrated on opportunities that we can pursue in a matter that allows us to continue to expand cash flow. Okay, got it. Thank you for all that information. I'm going to go ahead and get back in queue now. Thanks. Thank you.

Alan Cleave: The next question is from Alan Cleave with Maxim Group. Please go ahead. Yes, good morning. Great, great execution.

Hadi Chatterji: Can we start on Med SR? You mentioned continued softness. Some hope for growth in the second half. What's the state of the market there? Is it the competitive environment that that some parties are not allowed to use you or where do you see the potential to maybe turn things around? Thanks. Thank you, Allen. Good morning. So you're right. I think the industry of the health system, as you all know, is still continuing to be dominated by at least one, one stakeholder and the rest of the market shares between the next two or three other, other vendors.

Hadi Chatterji: So we continue to work and expand the relationship with the, with the second, the second and the third into the, in the industry in the market. When it comes to the first, the dominated player in the market, we still only can do a small piece of the overall services that we could have offered for the other smaller market shareholders. And that one we started to try to earn that business since it was completely stopped for us for the last two years.

Hadi Chatterji: So getting back on track is that it's realistically going to take some time because the projects are already signed and it works. So someone who is looking to get a new project started by the time we even sign up and start to recognize the revenue. It's going to take us couple of months before we can, we can earn that. But overall, bigger picture for medicine, how we think we can grow into that space, which is continuing to leverage our technology enabled RCM solution than some of these, whether it's an AI base tools or tools or our BI solutions, how we can cross sell and upsell into that medicine. So we continue to, we will continue and then continue to push towards that. And the second thing is expanding our relationship to the second and the third after the first, the largest market order. Thank you.

Hadi Chatterji: And then you, you had positive commentary on remote patient monitoring, wellness, overall. Is that growing as it just takes longer with existing customers to get set up where we're then making. We can get some patients compliant and billing, where is it also from like expanding the number of customers. Thanks. And in an actually it's a combination of both and as we evolved over the last roughly two years now into this year and a half, two years now for this chronic in management and remote patient monitoring.

Hadi Chatterji: So as an example, now recently we have started to launch over internal the next generation platform for remote patient monitoring and chronic care management. So, so now we started to leverage other mayors to engage the patient instead of just calling the patient. So in addition to calling the patient now, we're also trying to engage them through text messages through emails sending them the training videos, sending them the different type of text messages which whenever the patient has the time can click on it and fill up the forms and then our care managers get involved.

Hadi Chatterji: So we are overall improved the way we are approaching and trying to engage the patients. So one, it will yes even increase the existing patient adoption from the from the existing clients who already have started to take the service from us. And the second thing expanding in our existing client base, the chronic care management design, doing the new sales in our existing, existing client base in terms of the new logos. We do try to pitch those to the external clients, but this becomes a secondary nature with the help of this.

Hadi Chatterji: Another hope we try to always sign up for the overall technology enabled solution, RCM plus ASS solution and then also provide this chronic care management and remote patient monitoring service. Because for us the best thing would be to sign up our customer for the full end to end services that we can offer chronic care management and remote patient monitoring being one part of it. Thank you.

Hadi Chatterji: The last question on, um, lab, uh, CareClouds here say, I, um, how, how do you, do you talk a little about how you're thinking about going from, from, from relatively small medical customers to expanding it broader? Um, do you feel you have the, the, the sales infrastructure to do that or how, how would you approach that and is it, how do you feel about the competitive market of, um, affecting decision makers?

Hadi Chatterji: Thank you. Yeah, so, so, and if you think about it, we, uh, until the last, let's say, the 30 days on the 60 days before our first challenge for similar to other AI companies was refining their results, uh, focusing on. So we, we tried to use our own data and with the help of the AI technology leverage through either Google partnership or, or other players, how we can leverage our own data plus using the, the LLM's already provided by whether it's Google or other players.

Hadi Chatterji: So we kept on refining our, uh, our applications and then finally was able to push it out over the, over the, in the last 30 to 45 days to the existing client base. Similar to any other service, uh, another solution offering we have our best opportunity exists with the existing client base. We work with 2600 plus practices and 4,000 providers, including the BI solution client. So I think there's a tremendous opportunity that exists to expand into the existing client base.

Hadi Chatterji: So, uh, and, and I think AI is becoming one of the top line direct revenue driver. But in addition to that, uh, improving the existing workflows, how the same practice can save time, uh, because now the AI is part of their workflows. Uh, when you use chat, GPD, the same email can be written in, let's say, five seconds compared to two minutes. So, but it's not that you will be driving the direct revenue, but the overall workflow will help improve the revenue of the client.

Hadi Chatterji: And since most of our clients, uh, we charge them on a, on a collection fee of a revenue will increase. So, to, to answer the question, yes, there is a competitive market out there when you go, go out and trying to sell pure AI solutions. But for us, if you think about it, our AI solutions is, is going to improve transcription as an example. The existing client can take the service, sign up for the service, and the existing EHR system, this solution become part of the, uh, part of the existing workflow.

Hadi Chatterji: So, we think that this is one of the differentiation when you compare us to over competitors out there, where they might need to have a one separate solution, uh, uh, running independently and not fully integrated into their existing platform.

Hadi Chatterji: That's pretty, thank you so much. Thank you.

Operator: A reminder to all the participants, Analyst who wish to ask a question, may press star n1 on the telephone keypad. May request Analyst who wish to ask a question, may press star n1 on the telephone keypad. Thank you.

Norman Roth: As there are no further questions, I would now like to hand the conference over to Norman Roth for closing remarks.

Norman Roth: Thank you everyone for attending our conference today. Have a great day. Thank you.

Operator: This concludes today's teleconference. You may disconnect your lines at this time. Thank you for your participation.

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