Q2 2025 Hinge Health Inc Earnings Call

August 5, 2025

We'll host a question and answer session. If you would like to ask a question. Please raise your hand.

If you have dialed in to today's call. Please press star nine to raise your hand and star six two on mute I.

Ill now hand, the conference over to Bianca booked head of Investor Relations Bianca. Please go ahead.

Good afternoon, everyone and thank you for joining hinge health second quarter 2025 earnings conference call and our first as a public company I'm Bianca Buck head of Investor Relations at himself.

Joining me today are Daniel Perez, our co founder and Chief Executive Officer, Jim personally, our President and James Budge, Our Chief Financial Officer. Since this is our first earnings call. We felt it important to have Jim join damaging to give a refresher on our go to market motion.

Before we begin I'd like to note that today's call is being recorded and you can find all relevant materials, including our earnings presentation on the Investor Relations section of our website.

Today's discussion will include forward looking statements. These statements reflect our current views and expectations regarding future events, including expected performance of our business, our future financial results, our business and growth strategies and future prospects. These statements also include our improved financial outlook for Q3 and full year 2025 all of.

These forward looking statements are subject to various risks uncertainties and assumptions.

These statements represent our good faith judgment and beliefs actual results may differ materially from those projected or implied during the discussion.

Note that the forward looking statements on this call are based on information available to us as of today's date.

We undertake no obligation to update any forward looking statements, except as required by law for a detailed discussion of the risks and uncertainties that could cause our actual results to differ please refer to our IPO prospectus filed with the Securities and Exchange Commission as well as the Form 10-Q that will be filed next week. Additionally, during today's call we will reference.

Certain non-GAAP financial measures alongside our GAAP results.

Revenue will be discussed on a GAAP basis, while all other measures will be measured on a non-GAAP basis. These non-GAAP measures should be considered as supplemental to and not a substitute for our GAAP financial measures.

For a reconciliation of certain of our non-GAAP to GAAP measures. Please refer to our earnings release with that I'll now turn the call over to Dan for his opening remarks. Thank.

Thank you Bianca welcome everyone to our inaugural hinge held earnings call I'm excited to share our second quarter results and business update let me outline what we'll cover in our remarks first I'll provide a high level financial snapshot of our second quarter performance and give a quick overview of our business second I'll discuss our product updates include.

Some core product enhancements and update on our AI efficiency initiatives and the exciting announcement of intellect, our high performance network of in person providers third Jim will provide a commercial update including our recent sales momentum fourth James will go deeper into our financials and provide our formal guidance finally, all rich.

To wrap up with our strategic outlook and long term vision and then we'll open it up to questions lets David.

Firstly I'm pleased to report that hinge health delivered an exceptional second quarter, delivering profitable growth and demonstrating strong momentum across all key metrics revenue for the second quarter was $139 million up 55% compared to $90 million in the same quarter of last year.

Our non-GAAP income from operations was $26 million for 19% non-GAAP operating margin. Moreover, we generated $33 million of free cash flow for free cash flow margin of over 23%.

Our last 12 months calculated billings reached $568 million also up 55% year over year compared to $368 million in the prior year period.

As a reminder, our last 12 months calculated billings is a leading indicator for our revenue. This strong performance was driven by higher eligible lives from both new and legacy clients and better than expected enrollment yields resulting in increased members and billings James our CFO will go into more details about our financials, but we're proud about these results we believe they underscore the strength.

And momentum of our business.

Now since this is our first earnings call as a public company I'd like to take a moment to remind those new to our story what makes Finch helped special and why we're so excited about the opportunity ahead of us.

Our core Hinch health, it's automating health care delivery itself, starting with muscular sculptor munitions or them escape.

We've built a comprehensive platform that combines AI powered technology, a proprietary wearable device and expert care to deliver personalized evidence based treatment that can help members decreased their pain and improved quality of life, all while reducing health care costs for clients.

What sets us apart is our approach to scaling health care delivery, we've reduced human care team hours associated with traditional physical therapy by approximately 95% through automation, which allows us to reduce health care costs for clients, while improving members' health outcomes and satisfaction.

Our platform isn't just about digitizing existing processes. We believe were fundamentally reshaping how care can be delivered more effectively and efficiently.

The market opportunity before us is significant M. S. K spend in the U S reached $661 billion in 2023, and we believe that over $70 billion of that is spent on physical therapy.

Because MSI treatment has historically been procedure driven it consistently ranks as one of the top three health care spend categories for employers are clients partner with us because we deliver on health care is tripling enhancing the member experience improving member outcomes and reducing costs to put this in everyday terms think about.

Someone suffering from chronic back pain.

Traditional care often means waiting weeks for an appointment traveling to multiple providers and following a one size fits all treatment plan.

Hinshaw that same person can start to personalize care program within minutes right from home receive real time feedback for AI powered motion tracking technology and connect with the care team when needed all while their employer saves on health care costs.

We've built an efficient go to market motion and realized early on the benefits of key partners health plans pharmacy benefit managers or Pbms third party administrators for Ppas and others. We now have 50 plus partners many of whom have selected us as a preferred digital in this case solution, including all five of the largest national health plans by self insured lives.

And the three largest pbms buy market share.

This means the vast majority of our enterprise prospects yet to buy hinge health can turn us on without having to go through lengthy contracting our it security review, which is a big pain point in health care. We believe these partnerships differentiate hinge health as we seek to be one of the easiest solutions to buy and implement.

This combination of accessibility effectiveness and cost efficiency has resonated strongly with both our members and clients positioning us to capture a significant share of this growing market and as we look ahead, we see significant potential to expand our impact and continue automating the delivery of care.

It has been in the U S reached $661 billion in 2023, and we believe that over $70 billion of that is spent up this will there.

Because M. S. K treatment has historically been procedure driven it consistently ranks as one of the top three health care spend categories for employers.

Our clients partner with us because we deliver health care's tripling enhancing the member experience improving member outcomes and reducing costs to put this in everyday terms think about someone suffering from chronic back pain.

Let me now turn to our recent product innovations and enhancements we're headquartered in San Francisco. So we're very focused on tech driven innovation over the past three years alone. We've launched our women's public Health program fall Prevention program multiple iterations of our Enzo pain management device breakthrough AI powered motion tracking technology and her menopause.

Traditional care often means waiting weeks for an appointment traveling to multiple providers and following a one size fits all treatment plan.

The hinge hall at same person can start to personalize care program within minutes right from home receive real time feedback for our AI powered motion tracking technology and connect with the care team when needed all while their employer saves on health care costs.

Program among other products.

Three key product investment areas in 2025 worth mentioning include core enhancements.

Efficiencies and in select.

Starting with our core product enhancements, we've made significant improvements to our AI powered motion tracking technology or true motion, we've introduced more variety for exercises and enhanced three D visualizations, including our new smart skeleton feature.

We've built an efficient go to market motion and realized early on the benefits of key partners health plans pharmacy benefit managers or Pbms third party administrators with Ppas and others. We now have 50 plus partners many of whom have selected us as a preferred digital in this case solution, including all five of the largest national health plans by self insured lives.

This shows members a detailed view of their spine curvature and provides more dynamic movement tracking making at home exercise more intuitive and effective we've also streamlined how new members start with our program, making it easier to begin their care journey. This has led to more people successfully joining our platform and starting their hair. Additionally, we.

And the three largest pbms buy market share.

This means the vast majority of our enterprise prospects yet to buy hinge health can turn us on without having to go through a lengthy contracting our IP security review, which is a big pain point in health care. We believe these partnerships differentiation health as we seek to be one of the easiest solutions to buy and implement.

Found new ways to reconnect with members who happen to use our platform in a while we implemented various strategic campaigns and product niches showing these members. Our latest features and expanded offerings, which has successfully brought many of these members back to continue their care.

Overall members are more engaged and satisfied with our platform year over year, and we hit our all time high at member NPS in the first half of the year. These enhancements also had the benefit of driving our high client retention and improving member enrollment yields.

Now beyond our core product investment areas. We've also seen meaningful efficiency gains across the company from our AI initiatives benefiting both margins and scalability is just one tangible example, our proprietary degenerative AI powered care team assistant, which automates routine tasks like message drafting and reviewing clinical his.

<unk> program among other products.

Three key product investment areas in 2025 worth mentioning include core enhancements.

<unk> continued to improve this past quarter, we reduced the average time it takes our care team to respond to members by 16% in Q2 compared to Q1 and by 47% compared to a year ago, freeing up time for deeper interactions.

Efficiencies and in select.

Starting with our core product enhancements, we've made significant improvements to our AI powered motion tracking technology or true motion.

Finally, I'm excited to discuss hinge select our new high performance provider network, we announced in June that complements our digital M. S. K solution delivering a truly unified musculoskeletal care experience.

We've introduced more variety for exercises and enhanced <unk> visualizations, including our new smart skeleton feature. This shows members a detailed view of the spine curvature and provides more dynamic movement tracking making at home exercise more intuitive and effective we have also streamlined how new members start with our program.

A pinch select is a carefully curated marketplace that connects our members with high quality in person providers for services like imaging physical therapy injections and more all at up to 50% below typical insurance rates.

Making it easier to begin their care journey. This has led to more people successfully joining our platform and starting their care. Additionally, we found new ways to reconnect with members who haven't used our platform in a while we implemented various strategic campaigns and product measures showing these members. Our latest features and expanded offerings, which has successfully brought.

We are moving towards a future where health care delivery itself will be automated via software and connected hardware, but many aspects of care still requiring pursue providers any care that cannot yet be delivered by our technology will be directed to vetted in person providers designed to provide consistent evidence based support every step of the way and to ensure that terrorist CT.

Many of these members to continue their care.

Overall members are more engaged and satisfied with our platform year over year, and we hit our all time high of member NPS in the first half of the year. These enhancements also have the benefit of driving our high client retention and improving member enrollment yields.

David High quality and cost effective we expect that most members will begin with our flagship digital program, but for those who may benefit from an in person encounter there'll be routed using technology to a hinge like provider and in many cases continue the remainder of their care digitally this.

Now beyond our core product investment areas. We've also seen meaningful efficiency gains across the company from our AI initiatives benefiting both margins and scalability is just one tangible example, a proprietary regenerative AI powered care team assistant, which automates routine tasks like message drafting and reviewing clinical history.

This solution is intended to create value for everyone involved members employers providers and payors.

Members can get access to high quality in person care at low or no direct cost to them employers could benefit from reduced health care spending and better outcomes health care providers can get streamlined workflows faster payments and more focused patient referrals and our health plan partners are particularly excited about the ability to combine their existing networks with <unk>.

<unk> to create a better experience for members at a lower cost.

Finally, I am excited to discuss hinge select our new high performance provider network, we announced in June that complements our digital M. S. K solution delivering a truly unified musculoskeletal care experience.

We are starting with a limited pilot in late 2025, which we expect to be followed by a broader launch in 2026, we've already secured contracts with providers across more than 2100 locations as of the end of Q2 with many more being signed in Q3 to date, we have several large early client adopters.

Select is a carefully curated marketplace that connects our members with high quality in person providers for services like imaging physical therapy injections and more all at up to 50% below typical insurance rates.

While we don't expect meaningful revenue impact until 2027 in select represents an important opportunity to improve member outcomes and claimed ROI, while increasing yields and adding a high margin revenue stream for us as we'll recognize a percentage of the medical claims as net revenue. We're incredibly excited about this new offering and its potential to allow us to delay.

We are moving towards the future healthcare delivery itself will be automated via software and connected hardware with many aspects of care still requiring perceive providers any care that cannot yet be delivered by our technology will be directed to embedded in person providers designed to provide consistent evidenced based support every step of the way and to ensure that terrorist.

<unk> end to end Karen Emiscan.

With that I'll hand over to Jim <unk>, President to discuss our commercial optics.

Thank you Dan and thanks, everyone for joining I'm excited to share our commercial progress and market momentum with you all today.

High quality and cost effective.

We expect that most members will begin with our flagship digital program, but for those who may benefit from an in person and counter there'll be routed using technology to enhance like provider and in many cases continue the remainder of their care digitally this.

Our value proposition continues to resonate strongly with clients as evidenced by our consistently high client retention rates. As a reminder, we operate on an enterprise focus subscription software model, where we only generate revenue when members actively engage with our platform.

This solution is intended to create value for everyone involved members employers providers and payors.

This alignment of interest has proven particularly compelling for employers seeking to optimize their health care spend on handling employee benefits.

Members can get access to high quality in person care at low or no direct cost to that employers could benefit from reduced health care spending and better outcomes health care providers can get streamlined workflows faster payments and more focused patient referrals and our health plan partners are particularly excited about the ability to combine their existing networks with <unk>.

We have developed an efficient go to market model by working directly with our partners and clients.

Clients are primarily self insured employers and include many of the nation's leading enterprises across a broad range of industries and sizes.

Within this segment, we also serve many public sector self insured employers such as state local and city governments and labor unions.

Select to create a better experience for members at a lower cost.

We are starting with a limited pilot in late 2025, which we expect to be followed by a broader launch in 2026, we've already secured contracts with providers across more than 2100 locations as of the end of Q2 with many more being signed in Q3 states. We have several large early client adopters.

In most instances, we partner with our clients health plans, Tpa pbms or other ecosystem partners to reduce the friction of contracting procurement security 90 reviews implementation and billing.

As of the end of Q2, we had over 50 partners, putting the five largest national health plans and the top three pbms.

We're also in the early stages of expanding to serve health plans fully insured and Medicare advantage populations as well as federal insurance plans. We've seen good traction these segments over the past couple of years.

Before diving into our key priorities I want to remind everyone about our typical sales cycle.

And to end Karen Emiscan.

The majority of our clients and our contracts with us in the second half of each calendar year aligning with typical employee benefit enrollment periods.

With that I'll hand over to Jim <unk>, President to discuss our commercial optics.

Thank you Dan and thanks, everyone for joining us I'm excited to share our commercial progress and market momentum with you all today.

Most of these clients then launch in the first half of the following calendar year. This creates a natural rhythm to our business, where the first half focuses on launching new clients and building pipeline for the second half represents our peak sales season.

Given that the first half of 2025 has been focused on two key priorities success.

Successfully launching our clients one in 'twenty 'twenty, four and building a robust pipeline for the second half of the year.

This alignment of interest has proven particularly compelling for employers seeking to optimize their healthcare spend on handling employee benefits.

I am pleased to report strong execution on both fronts.

Our new client launches have exceeded expectations with eligible lives coming in higher than anticipated, which contributed to our financial outperformance this past quarter.

We have developed an efficient go to market model by working directly with our partners and clients.

Our clients are primarily self insured employers and include many of the nation's leading enterprises across a broad range of industries and sizes.

Our sales momentum is equally encouraging we've signed more lines in the first half of 2025 and in the first half of 'twenty 'twenty four we.

Within this segment, we also serve many public sector self insured employers such as state local and city governments and labor unions.

We had 2359 clients contracted as of the end of Q2 up 32% compared to Q2 2024 on the competitive front, we're feeling as confident as ever our win rate remains strong and has increased year over year.

In most instances, we partner with our clients health plans, Tpa pbms or other ecosystem partners to reduce the friction of contracting procurement security and ICU reviews implementation and billing as.

While early in the sales season looking at our 2025 wins, we're seeing particularly robust growth in our large employer enterprise and public sector segments.

As of the end of Q2, we had over 50 partners, putting the five largest national health plans and the top three pbms.

Also in the early stages of expanding to serve health plans fully insured and Medicare advantage populations as well as federal insurance plans, we've seen good traction in these segments over the past couple of years.

Our fully insured and federal programs are also showing promising momentum.

Recently, we validate our value proposition in the fully insured space through a new ROI study.

This study analyzed medical claims data from nearly 4800 health plan members and was validated by Gallagher, a leading global insurance brokerage and risk management and consulting firm.

Before diving into our key priorities I want to remind everyone about our typical sales cycle.

The majority of our clients and our contracts with us in the second half of each calendar year aligning with typical employee benefit enrollment periods.

On an average savings of 2000 and $343 per member per year, and a 2.4 times return on investment.

Most of these clients and launched in the first half of the following calendar year. This.

This creates a natural rhythm to our business, where the first half focused on launching new clients and building pipeline for the second half represents our peak sales season.

The study found meaningful cost savings from reduced utilization across a spectrum of health care services, including injections physical or occupational therapy with the majority of claims reduction 44% coming from avoided surgeries.

Given that the first half of 2025 has been focused on two key priorities.

Successfully launching our clients won in 2024 and building a robust pipeline for the second half of the year I.

This becomes our first large scale claims based study further reinforcing the significant value our platform delivers.

I am pleased to report strong execution on both fronts.

This past quarter, we also significantly expanded our program to reach across Europe, and launched in five new countries, the United Kingdom, France, The Netherlands, Ireland, and Germany building upon our existing presence in Canada in each of these markets, we've met Europe's strict privacy and regulatory requirements launching as a class one medical device.

Our new client launches have exceeded expectations with eligible lives coming in higher than anticipated, which contributed to our financial outperformance this past quarter.

Our sales momentum is equally encouraging we've signed more lines in the first half of 2025 and in the first half of 2024.

<unk> 2359 clients contracted as of the end of Q2 up 32% compared to Q2 2024 on the competitive front, we're feeling as confident as ever our win rate remains strong and has increased year over year.

As a reminder, we're currently focusing on U S based multinational corporations with employees abroad, rather than building separate sales and care teams. In these countries. This approach helps us better serve large corporations with global Workforces in the future, we expect to work with payers directly in those countries.

While early in the sales season looking at our 2025 wins, we're seeing particularly robust growth in our large employer enterprise and public sector segments.

As we look ahead to the second half of 2025, we believe we are well positioned to capitalize on our strong sales pipeline and continue our growth trajectory. The combination of our proven ROI enhanced product offerings and expanding market reach gives us confidence in our ability to maintain our leadership position in the M. S K care space.

Our fully insured and federal programs are also showing promising momentum.

Recently, we validate our value proposition in the fully insured space through a new ROI study.

This study analyzed medical claims data from nearly 4800 health plan members and was validated by Gallagher, a leading global insurance brokerage and risk management and consulting firm.

Now entering the height of our sales season in the next two quarters will be important in shaping our 2026 performance.

While the momentum is encouraging it's still early and we remain focused on disciplined execution and converting our pipeline to contracted lives.

On an average savings of $2343 per member per year, and a two four times return on investment.

Now I'll turn over James our CFO.

Thank you Jim before digging into the numbers, let me start by reminding everyone about our billings model, which is driven by three key components eligible lives yield which is our conversion rate of eligible lives to active members and average price per member.

This becomes our fifth large scale claims based study further reinforcing the significant value our platform delivers.

I'm pleased to report strong performance across all three of these components this quarter, resulting in strong billings.

This past quarter, we also significantly expanded our programs reach across Europe, and launching five new countries, the United Kingdom, France, The Netherlands, Ireland, and Germany building upon our existing presence in Canada and each of these markets, we've met Europe's strict privacy and regulatory requirements launching as a class one medical device.

Our last 12 months calculated billings reached $568 million, representing a 55% year over year growth compared to $368 million in the prior year.

This outperformance was driven by higher than expected eligible lives across our client base and stronger than expected member yields.

Average prices are coming in about as expected.

On the life side, we saw higher than expected numbers from both new client launches and organic growth within our existing client base.

For yield we saw improvements in both newly launched and legacy clients.

In the future, we expect to work with payers directly in those countries.

Our broad and targeted marketing campaigns performed well and we're seeing particular strength in our newly diversified channels.

As we look ahead to the second half of 2025, we believe we are well positioned to capitalize on our strong sales pipeline and continue our growth trajectory.

An example, one of several of our product led growth initiatives doubled conversions year over year in the first half of 2025 for that specific channel.

Combination of our proven ROI enhanced product offerings and expanding market reach gives us confidence in our ability to maintain our leadership position in the <unk> space.

Regarding the average price we are now two quarters into our new utilization based pricing model and are seeing strong evidence supporting asps parity with our previous model and we remain optimistic on the upside potential of this new model.

We're now entering the height of our sales season in the next two quarters will be important in shaping our 2026 performance.

While the momentum is encouraging it's still early and we remain focused on disciplined execution and converting our pipeline to contracted lives.

About 40% of our eligible lives opted for the new pricing model by the end of Q2.

Our billings momentum translated into revenue of 139 million for Q2, representing 55% growth compared to $90 million in the same quarter last year.

Now I will turn over to James our CFO.

Our non-GAAP gross margin improved to 83%.

From 77% last year, driven by operational efficiencies across our care team hardware infrastructure costs and our successful mitigation of tariff risks.

Pleased to report strong performance across all three of these components this quarter, resulting in strong billings.

We saw meaningful leverage across all three operating expense categories as we continue to scale on.

Our last 12 months calculated billings reached $568 million, representing a 55% year over year growth compared to $368 million in the prior year.

On a non-GAAP basis sales and marketing expenses as a percentage of revenue decreased to 36% from 48% in the prior year period.

This outperformance was driven by higher than expected eligible lives across our client base and stronger than expected member yields.

We benefited from strong marketing efficiency, driven by favorable channel dynamics lower than expected acquisition costs and strong conversion rates across our funnel.

Average prices are coming in about as expected.

On the life side, we saw higher than expected numbers from both new client launches and organic growth within our existing client base.

Research and development expenses declined to 16% of revenue from 27% last year.

For yield we saw improvements in both newly launched and legacy clients.

G&A expenses improved to 12% from 18% in the prior year period, despite increased costs to operate as a public company.

Our broad and targeted marketing campaigns performed well and we're seeing particular strength in our newly diversified channels. As an example, one of several of our product led growth initiatives doubled conversions year over year in the first half of 2025 for that specific channel.

This translated to our non-GAAP operating margin, reaching 19% a significant improvement from negative 16% in Q2 2024, reflecting continued discipline across all operating units.

Regarding the average price we are now two quarters into our new utilization based pricing model and are seeing strong evidence supporting asps parity with our previous model.

We've leaned into utilizing various AI tools as an organization, particularly within R&D, which is helping us become more efficient while maintaining headcount.

We remain optimistic on the upside potential of this new model.

Our free cash flow was 33 million, which represents a free cash flow margin of over 23%.

About 40% of our eligible lives opted for the new pricing model by the end of Q2.

Our billings momentum translated into revenue of 139 million for Q2, representing 55% growth compared to $90 million in the same quarter last year.

Compared to 16% in Q2 2024.

This increase was driven by our strong billings growth and improvements in our collections operations and improved operating efficiency.

Our non-GAAP gross margin improved to 83%.

We ended the quarter with $415 million in cash and investments down from 473 million at the end of Q1, primarily due to IPO related activities, which were partially offset by the $33 million of free cash flow generation.

77% last year, driven by operational efficiencies across our care team hardware infrastructure costs and the successful mitigation of tariff risks.

We saw meaningful leverage across all three operating expense categories as we continue to scale on.

As a reminder, our IPO offering was a mix of secondary shares in primary shares where we use the primary share proceeds of the IPO to pay withholding taxes on our issue settlements.

On a non-GAAP basis sales and marketing expenses as a percentage of revenue decreased to 36% from 48% in the prior year period.

We ended Q2 with 95 million fully diluted shares.

We benefited from strong marketing efficiency, driven by favorable channel dynamics lower than expected acquisition cost and strong conversion rates across our funnel.

<unk> of the outstanding preferred stock weighted.

A weighted average share count for non-GAAP purposes. This quarter is not a meaningful indicator given the timing and impact of our IPO.

Research and development expenses declined to 16% of revenue from 27% last year.

These Q2 results reflect the fundamental strength of our business model and our ability to drive both growth and operational efficiency.

G&A expenses improved to 12% from 18% in the prior year period, despite increased cost to operate as a public company.

As we look forward based on our strong first half performance I am pleased to announce our financial expectations for both the third quarter and full year 2025 for.

This translated to our non-GAAP operating margin, reaching 19%.

For Q3, 2025, we expect revenue to be between 141, and $143 million, representing 41% year over year growth at the midpoint for.

A significant improvement from negative 16% in Q2 2024, reflecting continued disciplined across all operating units.

For the full year 2025, we expect revenue to be between 548 and $552 million also reflecting 41% year over year growth at the midpoint.

We've leaned into utilizing various AI tools as an organization, particularly within R&D, which is helping us become more efficient while maintaining headcount.

Our free cash flow was 33 million, which represents a free cash flow margin of over 23%.

We expect non-GAAP income from operations to be between 17% and 21 million for Q3, or a 13% operating margin at the midpoint and between 77 and <unk> $83 million for the full year 2025 or up 15% operating margin at the midpoint.

Paired to 16% in Q2 2024.

This increase was driven by our strong billings growth and improvements in our collections operations and improved operating efficiency.

We ended the quarter with $415 million in cash and investments down from $473 million at the end of Q1, primarily due to IPO related activities, which were partially offset by the $33 million of free cash flow generation.

This guidance reflects continued operating efficiencies across the board.

We plan to lean into our first half momentum by reinvesting in the <unk> select and sales and marketing to further drive strong topline growth, especially with a significant number of lives still left to close.

As a reminder, our IPO offering was a mix of secondary shares in primary shares where we use the primary share proceeds of the IPO to pay withholding taxes on our issue settlements.

These improved expectations are primarily driven by the strength we saw in the first half, particularly in eligible lives performance and yield improvements.

We ended Q2 with 95 million fully diluted shares inclusive of the outstanding preferred stock.

While we're seeing strong traction on both metrics. The performance has been driven more by higher than expected launched eligible lives and we're confident in our ability to maintain this momentum.

The weighted average share count for non-GAAP purposes. This quarter is not a meaningful indicator given the timing and impact of our IPO.

As we look to the second half of the year, it's important to remind everyone that we face more challenging year over year comparisons due to last year being unusually backend weighted in terms of billings with.

These Q2 results reflect the fundamental strength of our business model and our ability to drive both growth and operational efficiency.

As we look forward based on our strong first half performance I'm pleased to announce our financial expectations for both the third quarter and full year 2025.

With its corresponding revenue distribution across the year.

The fourth quarter of 2024 was particularly strong due to effective product and marketing initiatives, we launched at that time.

For Q3, 2025, we expect revenue to be between 141, and $143 million, representing 41% year over year growth at the midpoint for.

Q4, traditionally sees lower member conversion rates versus the first three quarters due to the holiday season slowdown. So we typically deploy fewer member touch points during this period.

For the full year 2025, we expect revenue to be between 548, and 552 million also reflecting 41% year over year growth at the midpoint.

We've aimed to be thoughtful about our guidance taking into account market conditions, including recent developments and tariffs and the associated market exposure.

Whats, particularly compelling about our business model is resilient across economic cycles.

We expect non-GAAP income from operations to be between 17% and 21 million for Q3, or a 13% operating margin at the midpoint and.

During challenging economic times, we typically see increased demand as employers look to control costs through our proven ROI model.

And between 77 and $83 million for the full year 2025 or up 15% operating margin at the midpoint.

Conversely, when the economy is strong our platform may serve as a key tool for employee retention and satisfaction.

In terms of shares outstanding our diluted weighted average shares should normalize with our fully diluted share count in Q3.

This guidance reflects continued operating efficiencies across the board.

That said, we plan to lean into our first half momentum by reinvesting and in select and sales and marketing to further drive strong topline growth, especially with a significant number of lives still left to close.

We're anticipating a range of 95% to 96 million shares by the end of Q3, which includes the outstanding preferred shares.

Finally, as a reminder, our IPO lockup has a 90 day post lockup provision that allows for the release of up to approximately 2 million shares if the price has exceeded 120% of the IPO price for a certain period.

These improved expectations are primarily driven by the strength we saw in the first half, particularly in eligible lives performance and yield improvements.

While we're seeing strong traction on both metrics. The performance has been driven more by higher than expected launch of eligible lives and we're confident in our ability to maintain this momentum.

Credit trading dynamics, we are likely to hit the threshold with the additional 2 million shares becoming free to trade on August 19 2025.

We intend to announce our early lock up release on a form 8-K.

As we look to the second half of the year. It is important to remind everyone that we face more challenging year over year comparisons due to last year being unusually backend weighted in terms of billings.

These shares are held by our employees and service providers and exclude directors and officers.

With that thank you all for joining we remain confident in our business trajectory and look forward to sharing more updates in future quarters I'll now turn it back over to Dan to wrap it up.

With its corresponding revenue distribution across the year.

The fourth quarter of 2024 was particularly strong due to effective product and marketing initiatives, we launched at that time.

Thank you James before we open the call for questions I want to emphasize why we're optimistic about hinge helps future.

Q4, traditionally sees lower member conversion rates versus the first three quarters due to the holiday season slowdown. So we typically deploy fewer member touch points during this period.

Our business fundamentals reputation with our clients and member experience have never been stronger with exceptional progress across the board for the first half of this year, our product innovation continues to accelerate including true motion, where we launched a ton of new exercises are AI driven efficiencies and the announcement of our high performance in person network hinged select.

We've aimed to be thoughtful about our guidance taking into account market conditions, including recent developments and tariffs and the associated market exposure.

Whats, particularly compelling about our business model is resilient across economic cycles.

During challenging economic times, we typically see increased demand as employers look to control costs through our proven ROI model.

These advancements combined with our strong commercial execution and free cash flow gives us confidence to continue playing offense.

Conversely, when the economy is strong our platform may serve as a key tool for employee retention and satisfaction.

But truly excites me is that we are just beginning to scratch the surface of our potential the MSP market represents our initial focus but our vision extends far beyond we're building a new health care system that Leverages technology to automate care delivery itself transforming the member experience improving number of outcomes and reducing costs for our clients.

In terms of shares outstanding our diluted weighted average shares should normalize with our fully diluted share count in Q3.

We are anticipating a range of 95 to 96 million shares by the end of Q3, which includes the outstanding preferred shares.

The success, we've demonstrated in PT itself was $70 billion market. We believe provides a lot of runway and a blueprint for potentially automating other areas of healthcare delivery in the future.

Finally, as a reminder, our IPO lockup has a 90 day post lockup provision that allows for the release of up to approximately 2 million shares if the prices exceeded a 120% of the IPO price for a certain period.

As I mentioned in my IPO letter Health care remains one of our economies last readouts of manual labor. We have a century of work ahead of us in applying technology to automate care delivery itself and we're moving with urgency to capture this opportunity we believe that our double walled mode, combining technology innovation with preferred access to clients prefer.

Current trading dynamics, we are likely to hit those thresholds with the additional 2 million shares becoming free to trade on August 19 2025.

We intend to announce our early lock up release on a form 8-K.

And these shares are held by our employees and service providers and exclude directors and officers.

With that thank you all for joining we remain confident in our business trajectory and look forward to sharing more updates in future quarters I'll now turn it back over to Dan to wrap it up.

Ride us with a strong foundation for sustained long term growth now.

Now while we're proud of our quarterly results. We have a lot of work ahead health care is hard, but we have the team the technology and the stamina to realize our vision of automating delivery of care with that I'll turn it over to Bianca for Q&A.

Thank you James before we open the call for questions I want to emphasize why we are optimistic about hinge helps future.

Thank you Dan operator, we're now ready to open the line for questions.

Thank you we will now begin the question and answer session. Please limit yourself to one question and one follow up.

We would like to ask a question. Please raise your hand now.

Dialed in to today's call. Please press star nine to raise your hand and star six killing me. Please standby, while we compile the Q&A roster.

These advancements combined with our strong commercial execution and free cash flow gives us confidence to continue playing offense.

Truly excites me is that we are just beginning to scratch the surface of our potential the MSP market represents our initial focus but our vision extends far beyond we're building a new health care system that Leverages technology to automate care delivery itself transforming the member experience improving number outcomes and reducing costs for clients.

Okay.

Our first question comes from the line of <unk> Kalia with Barclays. Your line is open. Please go ahead.

Okay, Great Hey, guys can you hear me okay.

Okay Awesome, well hey, thanks for taking my my questions here and congrats on your first quarter as a public company.

The success, we've demonstrated in PT.

Socket absolutely Dan.

Self was $70 billion market. We believe provides a lot of runway and a blueprint for potentially automating other areas of healthcare delivery in the future.

John maybe for you just to start off.

Think one of the important channels that you have here is is to health plans and Pbms as you referred to in your in your prepared remarks, maybe the question is what are you hearing from them about sort of casting a wide net to their end customers and M. S. K and also what theyre thinking about as they think about other.

As I mentioned in my IPO letter Health care remains one of our economies last readouts of manual labor. We have a century of work ahead of us in applying technology to automate care delivery itself and we're moving with urgency to capture this opportunity we believe that our double walled moat, combining technology innovation with preferred access to clients provide.

Or sort of other products outside of Emmis game physical therapy from hedge that is.

With a strong foundation for sustained long term growth.

Great question, So look when a when a health plan improves one of our products. They go through like an 18 to 24 month evaluation process and they look at all the other day.

Now while we're proud of our quarterly results. We have a lot of work ahead health care is hard, but we have the team the technology and the stamina to realize our vision of automating the delivery of care with that I'll turn it over to Bianca for Q&A.

Digital Mfk's solutions out there on the market and so the fact that.

50, plus partners have selected us as their preferred partner most of them as their preferred partner shows that we are consistently performing above anybody else within digital M. S. K because they are so methodical and thoughtful and so thorough in their evaluation process and so when they when they do just like this is frankly, because they believe in the outcome for <unk>.

Thank you Dan operator, we're now ready to open the line for questions.

Thank you.

We'll now begin the question and answer session. Please limit yourself to one question and one follow up if you would like to ask a question. Please raise your hand now.

Have dialed in to today's call. Please press star nine to raise your hand and star six killing me. Please.

The experience and especially in our ROI and so when they bring us to their self insured book it is because of that belief and they believe their book of business will benefit from our product now we are in shelf, we take that trust very seriously.

Please standby, while we compile the Q&A roster.

Your first question comes from the line of Sucky Calia with Barclays. Your line is open. Please go ahead.

And as we develop new products, we're able to leverage these relationships that we have but we still have to demonstrate we are improving outcomes the experience and reducing costs with any single one of these products that we that we bring to market, but the fact is we have a track record of doing just that and Thats earned US a lot of trust with our health plan partners and a lot of credibility with our employer customers win.

Okay, Great Hey, guys can you hear me okay.

Yep Yep.

Okay Awesome, well hey, thanks for taking my my questions here and congrats on your first quarter as a public company.

Sockets absolutely.

Dan maybe for you just to start off.

I think one of the important channels that you have here is is to health plans and Pbms as you referred to.

When one of our health plan partners, bringing us to an employer. They know <unk> been speaking to my peer at this other company they've deployed hinge, we love to we'd love to bring us on it as well and it makes our health plan partners look good and again, we had a 98% logo retention in 2024. So we have a track record of building products that truly deliver the triple aim it's fair enough that trust.

In your prepared remarks, maybe the question is what are you hearing from them about sort of casting a wide net to their end customers in MSA and also what theyre thinking about as they think about other sort of other products outside of Emmis game physical therapy from hedge that is.

And because we have an intellectually honest approach to our product development, we will only sell products that we believe work and our health plan partners appreciate that our employer customers appreciate that we're going to keep it up where we're very excited to surprise you with some of the new products that will be landing in 2026.

Great question, So look when a when a health plan improves one of our products. They go through like an 18 to 24 month evaluation process and they look at all the other.

<unk> solutions out there on the market and so the fact that.

That's great to hear and definitely look forward to it James maybe for my follow up for you.

50, plus partners have selected us as their preferred partner most of them as their preferred partner shows that we are consistently performing above anybody else within digital Ms. Kate because they are so methodical and thoughtful and thorough in their evaluation process and so when they when they just like US is frankly, because they believe in the outcome for <unk>.

Can you just talk a little bit about that new pricing model.

Or can you.

Just remind us how different is it compared to sort of our traditional pricing model in and what impact or opportunity does it maybe have as we think about that becoming more prevalent.

Giving the experience and especially in our ROI and so when they bring us to the self insured book it is because of that belief and they believe their book of business will benefit from our product now we are in shelf, we take that trust very seriously.

Yes. Thanks packet, let me just give you a couple of details and then I think Dan might want to just add in a few bits and pieces here as well. So just as a reminder, worried about by the end of Q2 about 40%.

Our clients have moved to the new pricing model, rather than an upfront fee that gets amortized over time, it's more of a pay as you go with a platform fee upfront.

And as we develop new products, we're able to leverage these relationships that we have but we still have to demonstrate we are improving outcomes to the experience and reducing costs with any single one of these products that we bring to market, but the fact is we have a track record of doing just that and Thats earned US a lot of trust with our health plan partners and a lot of credibility with our employer customers win.

So a lot of our clients have opted to go that direction, we think it will even get a little bit higher than 40% over the coming two to three quarters in.

On the pricing side of the ESP, it's about at parity right now.

When one of our health plan partners permitted us to an employer. They know <unk> been speaking in my peer at this other company they've deployed hinge, we'd love to we'd love to bring this on it as well and it makes our health plan partners look good and again, we had a 98% logo retention in 2024. So we have a track record of building products that truly deliver the triple aim it's firmed up that trust.

Through the first half of the year and we expect that to continue as we move through the balance of the year and I'd say as I got there has really historically been two sides through our growth point. It is adding live that is.

Increasing the amount of people, who have access to our product and the second bit is increasingly enrollment from those lives that have access to the product to date asps have not been a meaningful contributor to our growth has been flat with this new pricing model that can be first things first though the new pricing model means we are much more accountable for delivering a product that.

And because we have an intellectually honest approach to our product development, we will only sell products that we believe work and our health plan partners appreciate that our employer customers. Appreciate that are going to keep it up. We're we're very excited to surprise you with some of the new products that will be landing in 2026.

Engages our members into LIFO and of course improves outcomes and reduces cost. This year. We are focused on a flat asps as we continued to deliver and last year. We had record engagement in the first half of this year again, we had a recommendation on a per member basis. It will allow us to earn the right to have a higher ASP and we like betting on ourselves.

Well, that's great to hear and definitely look forward to it James maybe for my follow up for you.

Can you just talk a little bit about the new pricing model.

Okay.

No.

Just remind us how different is it compared to sort of our traditional pricing model and what impact or opportunity does it maybe have as we think about that becoming more prevalent.

Very clear thanks, guys.

No.

Your next question comes from the line of Brad Sills with Bank of America. Your line is open. Please go ahead.

Yeah. Thanks, Let me just give you a couple of details and then I think Dan might want to just add in a few bits and pieces here as well. So just as a reminder, worried about by the end of Q2 about 40%.

Hey, guys can you hear me okay.

Yes.

Okay wonderful, thanks, guys and I'll Echo the congratulations on a nice quarter out of the gate here post the IPO.

Of our clients have moved to the new pricing model, rather than an upfront fee that gets amortized over time, it's more of a pay as you go with a platform fee upfront.

I guess.

Daniel will give you kind of step back here and you take a look at what drove the upside in eligible lives what would you attribute that to and I guess the same question on yield.

So a lot of our clients have opted to go that direction, we think it will even get a little bit higher than 40% over the coming two to three quarters in.

Just taking a step back it sounds like new customer signings was good expansions, where good within the within the existing customer base, but I guess what are the underlying drivers here that you would say on the demand side of the product side.

On the pricing side ESP, it's about at parity right now.

Through the first half of the year and we expect that to continue as we move through the balance of the year and I'd say as I think there is really a program we've been to sites through our growth point. It is adding live that is.

Sure how about I'll, let Jim take the first part of the question about what's driving our increased lives on above expectations and I'll take the second part around our increase enrollment yields.

<unk>, Inc.

Increasing amount of people, who have access to our product and the second bit is increasingly enrollment from those lives that have access to the product to date ASP has not been a meaningful contributor to our growth has been flat with this new pricing model that can be first things first though the new pricing model means we are much more accountable for delivering a product that engages our members.

I think first and foremost the strength of our product the investments that we've made in product again as you heard Dan mentioned earlier, a delightful experience its driving both clinical outcomes and a measurable ROI I think is really the backbone of that lives growth.

Things like offering choice and the engagement pricing model as well as new product offerings that we've rolled out has also been very attractive well received by the market.

As delightful and of course improves outcomes and reduces cost. This year. We are focused on a flat asps as we continued to deliver and last year. We had record engagement in the first half of this year again, we had record engagement on a per member basis.

So I think that really is the underpinning of the new lives growth.

And by the way with regards to the new lifeboat our win rates.

Allow us to earn the right to have a higher ASP and we like betting on ourselves.

It remains exceptionally high and so we're winning overwhelming majority of head to head deals that we have with others and our health plan partners Tpa and pharmacy benefit managers still make us the easiest we believed to be the easiest solution to buy for our enterprise customers and that's really been reinforced now with regards to enrollment yields.

Very clear thanks, guys.

Your next question comes from the line of Brad Sills with Bank of America. Your line is open. Please go ahead.

Enrollment answers one of our secret sauce is one of the most.

Hey, Brad you there.

Most important capabilities in digital health company needs to build and we leverage various amounts of proprietary data. We have access to couple this with quite a bit of predictive analytics and just a best in class consumer grade growth techniques and were constant experimenting and refining our targeted enrollment as well as our conversion methods and we've got a ton of wins this quarter.

You may be muted.

Okay skills. Your line is open.

Please go ahead, Hey, guys can you hear me okay.

Yes.

Okay wonderful, thanks, guys and I'll Echo the congratulations on a nice quarter out of the gate here post the IPO.

And so it's not just one initiative, which we like it's a combination of a bunch of singles and doubles that we were able to land none of which are or many of which are not yet done in there are fully optimized and thats what wed like to have a portfolio approach of many different ways to to build awareness within our member base, so that more and more people start.

Yes.

Daniel will give you kind of step back here and you take a look at what drove the upside in eligible lives what would you attribute that to and I guess the same question on yield.

Turner holding an engine and remain engaged with us over a longer period of time.

Super exciting. Thank you so much maybe one more follow up if I could James for you. Please you alluded to some efficiency gains here on the NII side I'm, a developer with developer productivity would love. It if you could elaborate a little bit there.

How about I'll, let Jim take the first part of the question about what's driving our increased lives on above expectations and I'll take the second part around our increase enrollment yields yes, I think first and foremost the strength of our product the investments that we've made in product again as you heard Dan mentioned earlier, a delightful experience its driving both clinical outcomes.

Where are you applying AI and what does that mean for.

The future cadence of release here as you guys look forward to the road map.

Yes, maybe.

Just to reinforce some of the numbers, we shared down to 16% of revenue, which is almost at our target model for where we want our R&D spend to go and AI has certainly been a big story behind that as far as some of the initiatives Dan kick in on that one yet and so we are making any comment on every team at hinge helps to apply AI.

And a measurable ROI I think is really the backbone of that lives growth.

Things like offering choice and the engagement pricing model as well as new product offerings that we've rolled out has also been very attractive well received by the market.

So I think that really is the underpinning of the new lives growth.

And by the way with regards to the new lifeboat our win rate.

To improve their efficiency not just in R&D, but in finance and our HR team and our operations team and our customer support across the board and some teams simply have more mature AI tools with which to avail themselves with and certainly R&D team I mean, it is a new dawn right now when it comes to building product.

It remains exceptionally high and we are in the overwhelming majority of head to head deals that we have with others and our health plan partners Teekay and pharmacy benefit managers still make us the easiest we believe to be the easiest solution to buy for our enterprise customers and that's really been reinforced now with regard to enrollment yields on our member enrollment and is one of our secret sauce is one of the.

Simply tech enabled products and things are moving faster than even we anticipated 12 months 18 months ago and for me and my co founder Gabe we are hands on particularly Gabriel He has taken the wheel as my cofounder and he is driving personally from the founder level AI adoption across our R&D organization and we are measuring.

Most important capabilities, a digital health company needs to build and leverage various amounts of proprietary data. We have access to couple this with quite a bit of predictive analytics and just a best in class consumer grade growth techniques, and we're constantly experimenting and refining our targeted enrollment as well as our conversion methods and we had a ton of wind this.

How many of our engineers are using AI tools to build their products, we are having trainings with rpms on our designers to ensure they are adopting AI products and it's meant that just across the board in R&D, we are shipping faster at a higher quality.

And so it's not just one initiative, which we like it's a combination of a bunch of singles and doubles that we were able to land none of which are many of which are not yet done and there are fully optimized and thats what wed like to have a portfolio approach of many different ways to to build awareness within our member base, so that more and more people start.

And landing on the target more and more frequently and it's really exciting because when you could ship more you could take more risks and you could take more shots on goal and thats why that should be benefiting the entire funnel.

Shorter holding an engine and remain engaged with us over a longer period of time.

Top of the funnel of upfront enrollment through engagement and Reengagement stereotype, but it's not just that where AI is driving efficiency. The other big area of domain, where theres a lot of low hanging fruit outside of just developer efficiency is in our care team efficiency and so we are applying a lot of.

Super exciting. Thank you so much maybe one more follow up if I could James for you. Please you alluded to some efficiency gains here on the NII side on the developer with developer productivity would love. It if you could elaborate a little bit there.

Where are you applying AI and what does that mean for.

The future cadence of release here as you guys look forward to the road map.

Brain cells towards putting our AI tooling in place for our care team because what's what's exciting about that is that we could make our care team interactions more personalized quicker more convenience as well as lowering costs. So to put in perspective, while we improved our efficiency and in several of our care team metrics were up 15% quarter over quarter.

Yes, maybe just to reinforce some of the numbers, we shared down to 16% of revenue, which is almost at our target model for where we want our R&D spend to go and AI has certainly been a big story behind that as far as some of the initiatives that kick in on that one yet and so we are making a comment on every team.

In terms of their speeds.

Or are there efficiencies and throughput for messaging members.

<unk> helps to apply AI to improve their efficiency not just in R&D, but in finance and our HR team and our operations team and our customer support across the board and some teams simply have more mature AI tools with which to avail themselves with and certainly R&D team I mean, it is a new dawn right now when it comes to building product.

And about over 45% year over year, our NPS at an all time high in the first half of the year. So what we're seeing is that not only we are becoming more efficient in how we engage our members. They are loving the product more than ever and that's really exciting and their engagements while their usage of the product was higher this year than it was last year or two so we're able to balance efficiency.

Particularly tech enabled products and things are moving faster than even we anticipated 12 months 18 months ago and EMEA, Michael Penner, Gabe we are hands on particularly Gabriel he has taken the wheel.

While improving the experience for our members, which is a true win win that we're aiming for.

Super exciting Daniel Thanks, so much thank you.

Your next question comes from the line of Craig Patent box with Morgan Stanley. Your line is open. Please go ahead.

As my cofounder and he is driving personally from the founder level AI adoption across our R&D organization and we are measuring how many of our engineers are using AI tools to build their products. We are having trainings with rpms in our designers to ensure they are adopting AI products and it's meant that.

Yes. Thank you a question on partnerships are understanding and you select isn't kind of pilot stage, just curious kind of the partnership's feedback in terms of what you're bringing to the table for these partners and how excited they are for it and then you also had a partnership with progeny I know you already have a lot of momentum in women's health, but just kind of what.

Across the board in R&D, we are shifting faster at a higher quality and landing on the target more and more frequently and it's really exciting because when you could ship more you could take more risks and you could take more shots on goal and thats why that should be benefiting the entire funnel.

That means that kind of building on that momentum on the women's health side.

Great question, and so with regards to health plan partners and their perspective and select our high performance network is designed to be complementary to our members existing health plan and provider network members continue to have full access to the current network coverage will also been medicines from our insight from its network and its integration.

Top of the funnel of upfront enrollment through engagement and Reengagement.

But it is not just that where AI is driving efficiency. The other big area of domain, where theres a lot of low hanging fruit outside of just a developer efficiency is in our care team efficiency and so we are applying a lot of.

It makes it easier for our members to access my value Mfk care typically with much lower out of pocket tav and minimal barriers to care and by combining the strength of a number of existing network with the integrated care opinion select high performance network, we can deliver a lot greater convenience additional choice and lower cost and so our health plan part.

Brain cells towards putting our AI tooling in place for our care team because what's what's exciting about that is that we could make our care team interactions more personalized quicker.

Quicker more convenience as well as lowering costs so to put in perspective, while we improved our efficiency and in several of our care team metrics are up 18% quarter over quarter in terms of their speeds.

Our we've had really positive discussions with them about bringing this blended network to their employer customers and even potentially several are discussing it for their fully insured lives and so we're really excited about the about the momentum we have with our health plan partners and I'll, let Jim talk about the partnership with <unk>.

Are there efficiencies and throughput for messaging members.

And about over 45% year over year, our NPS at an all time high in the first half of the year. So what we're seeing is that not only we are becoming more efficient in how we engage our members. They are loving the product more than ever and that's really exciting and our engagements while their usage of the product was higher this year than it was last year or two so we're able to balance efficiency.

Yes, so as we bring new products to market like women's pelvic health that we look for partners that are complementary and accretive to our efforts. We look for market leaders, who again are not just accretive from a product standpoint, but also through our brand and so <unk> would be a good example of that and so it's another organization from a lead Gen perspective.

<unk>, while improving the experience for our members, which is a true win win that we're aiming for.

Super exciting Daniel Thanks, so much thank you.

Also as a way to engage our members maybe as they're coming into there.

Your next question comes from the line of Craig Patent box with Morgan Stanley. Your line is open. Please go ahead.

Health care journey from a different angle it through a different door. It gives us one more touch point to to reach and engage members when and where they need us most and so.

Yes. Thank you a question on partnerships understanding any select isn't kind of a pilot stage just curious kind of the partnership's feedback in terms of what you're bringing to the table for these partners and then how excited they are for it and then you also had a partnership with progeny I know you already have a lot of momentum in women's health, but just kind of what.

Our project would be a great example of that one of the market leaders in women's health and has been a great early partner to us since launching that.

Great just a follow up question beyond kind of the core self insured market any anecdotes you can share in terms of inroads, you're making in fully insured and and the MAA markets as well.

That means the kind of building on that momentum on the women's health side.

Great question, and so with regards to health plan partners and their perspective and select our high performance network is designed to be complementary to our members existing health plan and provider network members continue to have full access to the current network and coverage will also been manifesting from our inside high performance network and it's integral.

Yes, we're seeing.

Great progress outside of outside and so we're seeing a lot of strength in our government business, our federal employee business, we're seeing strength in our labor markets.

As well as fully insured in Medicare advantage.

We've discussed previously we think this is a really exciting growth area for us and while we're in the early innings, we're seeing some really strong signals and some nice ROI being generated in there.

So it makes it easier for our members to access high value Ms Kay care.

Typically with much lower out of pocket cost and minimal barriers to care and by combining the strength of the members existing network with the integrated care opinion on high performance network, we can deliver lot greater convenience additional choice and lower cost and so our health plan partners are as we have really positive discussions with them about <unk>.

And these new markets for us so stay tuned more to come there but.

Really strong start.

Alright, thank you.

Your next question comes from the line of Jamie Lynn dressing with Truth Securities. Your line is open. Please go ahead.

Ringing this blended network to their employer customers and even potentially several are discussing is for their fully insured lives and so we're really excited about the about the momentum we have with our health plan partners and I'll, let Jim talk about the partnership with <unk>.

Thank you can you guys hear me okay, yes.

Yes, we can.

Congratulations on your first earnings call as a public company and a very strong quarter. So.

My first question is with respect to the 2026 selling season. Some nice momentum there I was wondering if you could spend some more time there in terms of any trends emerging to see it in terms of what clients are looking for either in terms of their preference for bundled offerings versus pricing model versus how the benefit is being structured and related to that can you give.

Yes, so as we bring new products to market like womens pelvic health that we look for partners that are complementary and accretive to our efforts. We look for market leaders, who again are not just a period from a product standpoint, but also our brand and so <unk> would be a good example of that and so it's another organization from a lead Gen perspective.

Number one how was how has been your win rate so far this year.

Also as a way to engage our members maybe as they're coming into there.

Yeah. Thank you for the question to Linda and.

So we're just entering the heart of our sale season now so we have to acknowledge that we're early in the heart of our sales season.

Health care journey from a different angle it through a different door. It gives us one more touch point to to reach and engage members when and where they need us most and so.

But what we're seeing is strong demand fueled by a couple of things one mfk costs still are.

Our project would be a great example of that one of the market leaders in women's health and has been a great early apparent to us since launching that.

One or two cost driver for the bulk of our clients. So they have to solve the cost issue from a bundle perspective.

Great just a follow up question beyond kind of the core self insured market any anecdotes you can share in terms of inroads, you're making in fully insured in the M&A markets as well.

Here a lot of commentary about that in the market, but in reality most of our buyers looking for best in class solutions.

You've heard Dan mentioned before we had the benefit of being both and we have the best of both being the strongest product in the market to address M. S. K outcomes and costs, but we also are the easiest to buy through those relationships with the health plans and the Pbms and the Tpa is so we are able to.

Yes, we're seeing.

Great progress outside of outside and so we're seeing a lot of strength in our government business, our federal employee business, we're seeing strength in our labor markets.

As well as fully insured in Medicare advantage.

We will use the word bundle, but the reality is most clients are still looking for that best in class solution, that's really going to solve their problem to the greatest extent.

Discussed previously we think this is a really exciting growth area for us and while we're in the early innings, we're seeing some really strong signals and some nice ROI being generated.

Best extent possible.

There are some of the kind of macro forces that were some of the tailwind that we're experiencing right now as we enter the heart of our sales season.

In these in these new markets for us so stay tuned more to come there but.

A really strong start.

And just to add on to that we do sometimes hear from like surveys and this and that.

Alright, thank you.

Your next question comes from the line of tailwind dressing with Trust Securities. Your line is open. Please go ahead.

Florida clients are looking to buy.

Several solutions across disease categories from a single provider, but there or single vendor partner, but their actual behavior shows that they still want a best in class cardio metabolic solutions don't want a best in class mental health solutions don't want a best in class applications, particularly for their top cost drivers and the factors that muscle skeletal the Tam is just so.

Thank you can you guys hear me okay.

Yes, we can.

Congratulations on your first earnings call as a public company and a very strong quarter. So.

My first question is with respect to the 2026 selling season. Some nice momentum there I was wondering if you could spend some more time, but in terms of any trends emerging to see it in terms of what clients are looking for either in terms of their preference for bundled offering versus pricing model versus how the benefit is being structured and related to that can you give us.

Large and in order to capture it it does require a lot of focus and we have remained very focused on even a relatively small portion of MSA, which is physical therapy is still $70 billion market and so we are really focused on capturing this what we believe to be a $70 billion market and we have a $500 million run rate behind this growing really fast.

Number one how was.

How has been your win rate so far this year.

Yes. Thank you for the question to Linda and.

So we're just entering the heart of our sale season now so we have to acknowledge that we're early in the heart of our sales season.

But a lot of runway left.

Okay and then my follow up is on the yield improvement you guys called out in both newly launched in legacy clients, maybe talk about some of the key drivers. There you kind of does in pieces, but just give us a little bit more kind of concerns. They have like why what has been driving that and can you frame the magnitude of difference between the improvement between the two.

But what we're seeing is strong demand fueled by a couple of things one mfk cost still are tough.

Top one or two cost driver for the bulk of our clients. So they have to solve the cost issue.

I'm a bundled perspective.

You hear a lot of commentary about that in the market, but in reality most of our buyers looking for best in class solutions.

Klein and related to that maybe touch on a hinge connect is having a meaningful impact on ease or is that still ahead of us.

As you've heard Dan mentioned before we have the benefit of being both and we have the best of both being the strongest product in the market to address the <unk> outcomes and costs, but we also are the easiest to buy through those relationships with the health plans and the Pbms and the Tpa is so we are able to.

Great Yeah, So I just want to make sure I catch it country component, so with regards to our yield improvements between existing and new customers, we're not breaking that out here.

But we've had very consistent yield improvements across the board for both new and existing customers and we haven't seen a material difference, though by the way so I'm.

If you will use where bundle, but the reality is most clients are still looking for that best of class solution, that's really going to solve their problem to the greatest extent.

Not sharing that because I don't want to start actually havent seen its wasn't really risen to my level of there being much of a difference and with regards to what we're doing to improve yield. So it starts with both an enrollment youll start with.

Best extent possible.

And those are some of the kind of macro forces that were some of the tailwind that we're experiencing right now as we enter the heart of our sales season, and just to add onto that we do sometimes hear from like surveys and this and that.

How can we better target members, who need our services, sometimes when people will have a muscle skeletal care episode it could be episode limited Springer ankle they had.

Employer clients are looking to buy.

Several solutions across disease categories from a single provider, but there.

A flare up in their back pain after their horse around with their kids or their they twisted their knee playing basketball and how can we get better at identifying people when they're early in their in their care episodes, but also building our brand within any given employer base or member base since that they think about us.

Single vendor partner, but their actual behavior shows that they still want a best in class cardio metabolic solutions don't want a best in class Dental health solutions to one of the best in class Amex cases, particularly for their top cost drivers and the fact is that muscle skeletal. The Tam is just so large.

When theyre in pain, and that's one of the key reasons why we expanded with our select in person provider network to lender because with our in person provider network, we're able to offer in person physical therapy, we're able to offer joint injections. We are able to offer imaging. We are able to offer doctor visits and now for a member no matter what may be ailing them with regards to their back.

In order to capture it it does require a lot of focus and we remain very focused on even a relatively small portion of MSA, which is physical therapy is still $70 billion market and so we are really focused on capturing this what we believe to be a $70 billion market and we have.

For muscle pain, they could see us as their one stop shop for the orthopedic care needs and don't have to think well. He is does the digital PT, but I can't think Thomas senior person or and I really think I need an MRI first before I get a brightcove.

$80 million run rate behind this growing really fast, but a lot of runway left.

And then my follow up is on the yield improvement you guys called out in both newly launched in legacy clients, maybe talk about some of the key drivers you're kind of in pieces, but just give us a little bit more kind of concerns. They have like why what has been driving that and can you frame the magnitude of difference between the improvement between the two setup.

C N shop now that.

That cognitive dissidence could go away and hinge is my one stop shop for anything related to MSA, both in person and digital care and we think that's going to really improve our yields both for digital care, but of course, we're going to capture additional yield for for in person now with regards to interconnect. This allows us.

Lines and related to that maybe touch on a pinch connect is having a meaningful impact on <unk> or is that still ahead of us.

To both integrate with <unk>.

Great Yeah. So I just want to make sure I capture country components, so with regards to our yield improvements between existing and new customers are not broken that out here.

<unk> as well as gift.

Quite a bit of claims data as well and that is ramping up to focusing on the claims data will ramp that up quite substantially and with <unk>. It really helps when you have so many dozens of health plan partners, because thats, where youre getting a lot of the data from and we know when we enroll somebody who's had a prior musculoskeletal Claimer ROI goes up and so we know these are what we call internally.

But we've had very consistent yield improvement across the board for both new and existing customers.

We haven't seen a material difference, though by the way so I'm.

Not sure on that because I don't want to start actually havent seen as long as really risen to my level of there being much of a difference and with regards to what we're doing to improve yield. So it starts with both an enrollment youll start with.

Roy Rich members and we want to be able to spike our member base with ROI rich members, knowing that that's going to increase our client retention overall and drive up are the points that we can with the rebirth of ROI. When members sign up we have north of 90% of them I think.

How can we better target members, who need our services, sometimes when people will have a muscle skeletal care episode it could be episodes limited explain their ankle.

Plus or minus type of thing is closer to 95% of members allow us to then integrate with their EMR and that means that we can monitor their care over time and in case, they become a higher risk member say they get referred for an MRI or device surgically referral, we're able to follow up with them and that really that actually comes post enrollment, but it allows us to to capture members who are.

Their care episodes, but also building our brand within any given employer base or member base.

They think about us.

We're trending towards the high cost and these are some of the reasons why we have such a high logo retention.

When theyre in pain and Thats one of the key reasons, why we expanded with our select in person provider network to a lender because with our interest in provider network. We are able to offer in person physical therapy, we're able to offer joint injections were able to offer imaging. We are able to offer doctor visits and now for a member no matter what may be ailing them with regards to their backdrop from us.

Perfect. Thanks, guys. Congrats again, thank you for great questions and let him.

Your next question comes from the line of Elizabeth Anderson with Evercore ISI. Your line is open.

Please go ahead.

Hi, guys. Thanks, so much for the question and congrats on your first quarter out it's great to see that.

Whole pain, they could see assess their one stop shop for the orthopedic care needs and will have to think well set the digital piece I can become a senior person or and I really think I need an MRI first before I get a vehicle <unk>.

Other question I wanted to just double click a little bit more on hinge to like can you talk a little bit more about the business model. I know you said it wasn't really a big contributor until more like 2027, but how do you sort of think about that from a business model perspective, I don't see my details on that would be very helpful. Thank you great.

<unk> now they can do that.

<unk> dissidents could go away and inches my one stop shop for anything related to MSA, both in person and digital care and we think that's going to really improve our yields both for digital care, but of course, we're going to capture additional yield for for in person now with regards to interconnect. This allows us.

Great question. So look we are very excited about it and she likes potentials, where we are taking a measured approach to the rollout will begin a limited pilot here in late 2025, followed by a broader rollout in 2026 and again for those tuning in there might not be aware and selected our in person provider network for revenue impact as you mentioned, we expect a minimal impact through 'twenty six with more meaningful.

To both integrate with EMA.

<unk> as well as get.

Contributing to happening in 2007, and we think in select is a great way for us to improve the member experience and just augment that ROI for our clients.

So the business it will help us capture more individuals as mentioned earlier losses and stretch the brand beyond physical therapy to our members one stop shop for any orthopedic care needs and for the in person network that we're assembling the business model, we're going to be a certain percentage rate on a claim as an admin fee and then ultimately report that is net revenue and will be better positioned to quad.

Roy Rich members and we want to be able to spike our member base with ROI rich members, knowing that that's going to increase our client retention overall and drive up are the points that we get with it reports our rois when members sign up we have north of 90% of them I think.

Plus or minus type of thing, it's closer to 95% of members allow us to then integrate with their EMR and that means that we can monitor their care over time and in case, they become a higher risk remember, saying to get referred for an MRI or <unk> surgically referral, we're able to follow up with them and that really that actually comes post enrollment, but it allows us to to capture members who.

Defy the financial impacts as we gather more data from a pilot program, but even we're launching into our own employees, because we're selling surplus from the interest of our own employees to access the network. We're really excited about the member demand for this as we had hundreds and hundreds of our employees dialing in to our own internal webinar one of the most popular benefits we've ever launched.

We're trending towards the high costs and these are some of the reasons why we have such a high logo retention.

And my dad.

Oh, sorry.

I'm just going to add.

Thanks, guys. Congrats again, thank you great question to lithium.

As Ben has been tremendously positive I think the market understands it I think it's intuitive to them I think this idea of unified care, the elegant integration of digital care and in person care into a cohesive member experience just resonates with the market and the early market reception has been phenomenally strong.

Your next question comes from the line of Elizabeth Anderson with Evercore ISI. Your line is open please.

Please go ahead.

Elizabeth you might be on mute.

Yeah, No that's super Great to hear and you also mentioned you have a new ROI study going to be a fully insured book of business, which is obviously an exciting titles that longer term opportunity can you talk to us about sort of the duration of that study and obviously I think that would likely be helpful. In terms of everything our sale process for that so just kind of thinking about that timeline that love that might be until it would be helpful. Thank you.

Hi, guys. Thanks, so much further question and congrats on your first quarter out it's great to see that.

Another question I wanted to just double click a little bit more on hinge.

So like can you talk a little bit more about the business model I know you said it wasn't really a big contributor until more like 2027, but how do you sort of think about that from a business model perspective helps you more details on that would be very helpful. Thank you.

Sure sure Yeah, we looked at almost 5000 members over a 24 month period.

<unk>.

Pat Gallagher do the actuarial analysis and took a hard hard look at the impact that we're having and.

Great question. So look we are very excited about <unk> potential is where we are again measured approach to the rollout will begin a limited pilot here in late 2025, followed by a broader rollout in 2026 and again for those tuning and it might not be aware and selected our in person provider network revenue impact as you mentioned, we expect a minimal impact and 326 with more meaningful.

As I think we mentioned earlier the results were about two four times ROI.

And and that's that's in line.

With kind of what we typically would see but again keeping in fully insured which is again very heavily supported by actuarial analysis by underwriters.

Contribution of happening in 2007, and we think in select is a great way for us to improve the member experience and just augment that ROI for our clients.

The bar is a little bit higher there and so to be able to deliver that kind of compelling ROI and that member population was really affirming and exciting for us.

For the business and Jill will help us capture more individuals as mentioned earlier it allows us to stretch the brand beyond physical therapy to our members one stop shop for any orthopedic care needs and for the in person network that we're assembling the best models, we're going to be certain percentage rates on the claim as an admin fee and then ultimately report that is net revenue and will be better positioned to quant.

Okay. Thanks, so much and congrats thank you.

Your next question comes from the line of Ryan Daniels with William Blair.

Defy the financial impacts of the gather more data from a pilot program, but even we're launching into our own employees because we're self insured.

Hey, guys, sorry about that can you hear me okay.

Again.

Perfect I'll add to the course of congratulations on the strong quarter out of the box James maybe one for you just on the Q3 operating margin I know it is trending down.

Interest for our own employees to access the network. We're really excited about the member demand for this as we had hundreds and hundreds of our employees dialing in to our own internal webinar one of the most popular benefits we've ever launched.

A bit still well above where our model was I know some of that's the typical sales and marketing spend into the core selling season, but it sounds like you're leaning heavily to some R&D for product development and maybe further expansion in select network. So can you give us a little more color on what we should anticipate and if theres any difference in the cadence of spending maybe in the back half.

I might add just a bit.

So I'm just going to add.

As Ben has been tremendously positive I think the market understands it I think it's intuitive to them I think this idea of unified care to the elegant integration of digital and in person care into a cohesive member experience just resonates with the market in the early market reception has been phenomenally strong.

For the year.

Yes, thanks for the question Ryan.

You have cut that observation well, we actually think we have a super exciting selling season coming up and we want to lean more into that than what we were previously expecting which is the fundamental reason why youre seeing that.

Yeah, No that's super Great to hear and you also mentioned you have a new ROI study going to a fully insured book of business, which is obviously an exciting titles that longer term opportunity can you talk to us about sort of the duration of that study and obviously I think that would likely be helpful. In terms of it yourself process for that so just kind of thinking about that timeline, a little bit more detail would be helpful. Thank you.

Operating expectation.

<unk> come down a little bit.

What you are noticing probably in the R&D line, Thats, where a fair amount of our hedge select costs, though when we're putting a bit more into that as well as we lean into that in the second half. So those are the two areas.

Sure sure Yeah, we looked at almost 5000 members over a 24 month period.

The warrant additional investment if you will as we move from the second quarter to third quarter.

Uh huh.

Gallagher do the actuarial analysis and took a hard hard look at the impact that we're having and as.

Yes, perfect with a huge amount of Tam laughed and.

I think we mentioned earlier the results were about two four times ROI.

Several recent feedback or thoughts we've had internally is that how can we better position us to even capture that and maybe if you can run a little bit faster and so we're hiring additional sales heads to better capture this opportunity ahead of them.

And and that's in line with kind of what we typically would see but again keeping in fully insured which is again very heavily supported by actuarial analysis by underwriters.

Great. That's helpful. And then if we think about the new relationship with Cigna. Thank you announced that in April. So it was kind of not ready to go at the start of the year, but ahead of the key selling season any thoughts on how that's developing that's obviously a big new channel partner for you. So would be curious if you're seeing early momentum there.

The bar is a little bit higher there and so to be able to deliver that kind of compelling ROI.

That number population was really affirming and exciting for us.

Okay. Thanks, so much and congrats thank you.

And if that's helping at all with the momentum Youre seeing in self insured employers in the public sector.

Your next question comes from the line of Ryan Daniels with William Blair.

Yes, while we don't breakout specific results by partner I will say the same relationship as officially launched and got off the ground. We're seeing very strong results from our pipeline development perspective as millions of lives of Cigna's lives have entered.

Mainly <unk>.

Mr. Daniel Your line is open.

Still muted I think.

And into our pipeline and we're actually starting to see some of that come through the pipeline and come out. The other side is as as clients and preparing to launch those clients here, both this year and into 2026.

Okay.

Hey, guys, sorry about that can you hear me okay.

Hi, Ken.

Perfect I'll add to the course of congratulations on the strong quarter out of the box James maybe one for you just on the Q3 operating margin I know its trending down a bit still well above where our model was I know some of that's the typical sales and marketing spend into the core selling season, but it sounds like you're leaning heavily to an awesome.

We're really encouraged by the enthusiasm that our are part of the Cigna showing for our solution and we're excited.

Have them play a meaningful role in the growth and success here, both in 2025 and beyond.

Great. Thanks for the color I appreciate it.

R&D for product development and maybe further expansion in select network. So can you give us a little more color on what we should anticipate and if theres any difference in the cadence of spending maybe in the back half of the year.

Your next question comes from the line of Richard close with Canaccord Genuity.

Mr. <unk> your line is open.

Yes. Thanks for the questions can you hear me, Okay sure Ken excellent.

Yes, thanks for the question Ryan.

You have cut that observation well, we actually think we have a super exciting selling season coming up and we want to lean more into that than what we were previously expecting which is.

Just wanted to talk a little bit.

A little bit about the win rates good to hear that those have been improving I'm just curious.

Fundamental reason what youre seeing.

Operating expectation that margin come down a little bit.

Your largest competitors seems to be expanding into other areas such as mental health I think some AI development.

What you are noticing probably in the R&D line is thats, where a fair amount of our hedge select cost to go and we're putting a bit more into that as well as we lean into that in the second half. So those are the two areas.

Mission is and just curious.

Any thoughts in in terms of do you think that improves the opportunity for win rates to go up for you guys going forward during the selling season.

The warrant additional investment if you will as we move from the second quarter fiscal quarter.

Yes.

Perfect.

The amount of Tam left and.

Yes. Thank you for the question Richard So as you as you mentioned our win rate continue to be very strong and increasing year over year, we actually think of our largest competitor as being distracted and not moving forward with a digital musculoskeletal solution.

Several recent feedback or thoughts we've had internally is that cap we better.

Better position us to even capture that and maybe if you can run a little bit faster and so we're hiring additional sales heads to better capture this opportunity ahead of them.

Whether it's a new health plan RFP, maybe they're putting their P. B amount to RFP, we still see our biggest competition being a no decision or a deal pushing to next year and so we're always looking for ways again to increase value to improve outcomes. We do think that staying focused in MSP.

Great. That's helpful. And then if we think about the new relationship with Cigna. Thank you announce that in April so it was kind of.

Not ready to go with the start of the year, but ahead of the key selling season any thoughts on how that's developing that's obviously a big new channel partner for you should be curious if youre seeing early momentum there and if that's helping at all with the momentum youre seeing in self insured employers in the public sector.

<unk> is really important as Dan mentioned earlier, the Tam is enormous the problems.

It can be complex and our ability to really build something end to end comprehensive that's delightful whether you're in person and digitally we think is a really compelling offering and we're hearing that feedback from the marketplace. Both in what they are telling us and also how they're behaving by what they are buying today. So we really like our strategy, we love our competitive.

Yes, while we don't break out specific results by partner I will say this in relationship as officially launched and got off the ground.

Being a very strong results from our pipeline development perspective as millions of lives of Cigna's lives have entered are.

So our pipeline.

Actually it's not a system that comes through the pipeline and come out the other side is as as clients and trying to launch those clients here, both this year and into 2026.

Position and we see that only growing stronger in the months and years ahead.

I, just underlined Richard ethane, yet focus matters like health care is hard capturing orthopedics is hard and even capturing physical therapy is accepting hard you know our vision is to use technology to scale and automate the delivery of care and you're taking unstructured physical passed and you're using software connected hardware to automate the delivery of that we've got about 500 employees at himself laser.

We're really encouraged by the enthusiasm that our our cigna showing for our solution and we're excited.

Have them play a meaningful role in the growth and success here, both in 2025 and beyond.

Great. Thanks for the color I appreciate it.

We're focused on that problem and we've had a lot of momentum behind us able to do that we'd like to see that.

Your next question comes from the line of Richard close with Canaccord Genuity.

In some ways competitors or are trying to look elsewhere to find their growth because of our win rates have been have been really high within our market and theres a lot more runway to go within this market, we're going to continue over time to acquire our model to other areas of health care, but where we can leverage our existing infrastructure that we.

Your line is open yes. Thanks for the questions can you hear me, Okay. So again excellent.

So.

Just wanted to talk a little bit.

A little bit about the win rates good to hear that those have been improving I'm just curious.

Your largest competitor seems to be expanding into other areas such as mental health I think some AI development.

We built both existing products that we built as well as our sales team and our in our client base, because we see that as incredible assets.

Okay. That's helpful and quick follow up on yields Ben.

<unk> and just curious.

Talked about a little bit several times here on the call you do if I remember correctly have you know on the self insured some yields high single digits, maybe low double digits.

Any thoughts.

In terms of do you think that improves the opportunity for win rates to go up for you guys going forward during the selling season.

Yes. Thank you for the question Richard So as you as you mentioned our win rate continues to be very strong and increasing year over year, we actually think of our largest competitor as being distracted and not moving forward with a digital musculoskeletal solution, whether it's a new health plan RFP, maybe the deployment of <unk> out to RFP, we still see our bigger.

I'm just curious the thought process on <unk>.

Progressing to yield higher and then maybe specifically the MAA and fully insured books.

Those are relatively new are you seeing any dynamics that those would be meaningfully different from the self insured over time.

Competition being a no decision or pushing to next year and so we're always looking for ways again to increase value to improve outcomes. We do think that staying focused in.

Great question, and so starting with like the potential for our yields 40% of Americans have a muscular skeletal conditions in any given year range of again from a twister need to hip arthritis to a sprained ankle to chronic low back pain. So 40% of American adults have a muscle sculpting finished in any given year, 90% of them see a physical therapist, who is a big gap.

<unk> is really important as Dan mentioned earlier, the Tam is enormous the problems.

Can be complex and our ability to really build something end to end comprehensive that's delightful whether youre in person and digitally.

Between those who are in pain, and those actually getting care for physical therapy, and there's a lot of reasons for that physical therapy could be and convenient can be expensive you ought to take time off work hire a babysitter and we've developed a product that makes it much more convenient and accessible and lower cost and we believe to be more effective as well.

<unk> is a really compelling offering and we're hearing that feedback from the marketplace. Both in what they're telling us and also how they're behaving by what they're buying today. So we really like our strategy, we love our competitive position and we see that only growing stronger in the months and years ahead.

And I actually think that percentage of people seeking physical therapy or getting physical therapy should be closer to 12% to 15% not 9%.

I, just underlined Richard ethane, yet focus matters like health care is hard capturing orthopedics is hard and even capturing physical therapy is accepting Hart. Our vision is to use technology to scale and automate the delivery of care and you are taking unstructured physical cast and you're using software captive hardware to automate the delivery of that we've got about 500 employees that handheld laser.

During 2024, we had three 4% of people.

Baxter handheld adult use himself. So we're getting 37, not quite 40% of equivalents to in person PT and that's gone up from years ago. It was like 2% and we want to continue to invest in our yields.

Focused on that problem and we've had a lot of momentum behind us able to do that we'd like to see that.

We could approximate the.

In some ways competitors or are starting to look elsewhere to find their growth because of our win rates have been.

The take rate of in person PT at 9% and eventually we'd like to go beyond that we know how long it's going to take it's going to take a while but we like the investments that we're putting in with regards to our enrollment rates for MAA and fully insured the investments we made across our self insured book benefit both of those books as well it's very consists.

Been really high within our market and Theres a lot more runway to go within this market.

We're going to continue overtime to acquire our model to other areas of healthcare, but where we can leverage our existing infrastructure that we built both existing products that we built as well as our sales team and our client base, because we see that as incredible assets.

<unk> product and certainly Theres no difference even in the age range of the profile of the members for fully insured and self insured.

Okay. That's helpful and quick follow up on yields then.

<unk> that roughly this exact same age roughly $45 46 years old and as a little older.

Talked about a little bit.

Several times here on the call you do if I remember correctly you have on the self insured some yields high single digits, maybe low double digits.

But we actually see some of our highest engagements on a per member basis from MAA as people get more concerned about their mobility there their interest in using hinge on a per member basis goes up and I think we have time for one more question.

I'm just curious the thought process on <unk>.

Progressing the yield higher.

Your final question for today comes from the line of Brian Peterson with Raymond James Your line is open. Please go ahead.

And maybe specifically the MMA and fully insured books.

Thanks for squeezing me in guys and congrats on a strong quarter, maybe for Dan or Jim just yeah.

Those are relatively new are you seen any dynamics that those would be meaningfully different from the self insured over time.

You have these new partnerships and everything on these market expansion, you're growing revenue into <unk>.

Great question, and so starting with like the potential for our yields.

It's really rarefied air.

40% of Americans have a muscular skeletal conditions in any given year arrangement again from a twist to need to hip arthritis to sprained ankle to chronic low back pain, so 40% of American adults have a muscle sculpting, finishing in a given year, 90% of them see a physical therapist theres a big gap between those who are in pain and those actually getting.

I'd really just like to understand how does the pipeline growth look relative to the billings and revenue growth and how should we be thinking about that in terms of greenfield versus competitive displacement. Thanks guys.

Yes.

So pipeline growth continues to be incredibly strong we're very pleased and again. It is like you said it is a good leading indicator.

Care for physical therapy, and there's a lot of reasons for that physical therapy could be and can median can be expensive you ought to take time off work hire a babysitter and we've developed a product that makes it much more convenient and accessible and lower cost and we believe to be more active as well and I actually think that percentage of people seeking physical therapy are getting.

Of what ultimately bookings and revenue will look like in the outer years.

You think about the split between the competitive displacements and and Greenfield.

We're seeing quite a few competitive displacements, which is really encouraging the reality is the Tam is so big that the bulk of the growth is going to come from from Greenfield opportunities just given the size of the Tam and the unmet need so we're we're absolutely.

Physical therapy should be closer to 12% to 15% not 9%.

Last year in 2024, we had three 4% of people.

Our backs to hinge helped adult use <unk>. So we're getting 37, not quite 40% equivalent to in person PT and that's gone up from years ago. It was like 2% and we want to continue to invest in our yields.

<unk> are focused on delivering the best experience that attracts you know folks from other competitors to the hidden solution, but I think from a mixed perspective, you still don't see the bulk of the growth coming from Greenfield just given how much unmet.

We could approximate.

Unmet opportunity there is out there.

The take rate of in person PT at 9% and eventually we'd like to go beyond that we know how long is going to take it's going to take a while but we like the investments that we're putting in with regards to our enrollment rates for MAA and fully insured the investments we make across our self insured book benefit both of those books as well it's very consistent.

Great. Thank you.

And part of the revenue growth again will overtime comfort lives, but also through our increased enrollment yields as well. So the both two sides of our growth point and as we continue to improve the product will earn the right to increase the ASP as well, which will give another growth lever beyond just lives.

And of course, new products that we're launching.

Product and certainly Theres no difference even in the age range of the profile of the members for fully insured and self insured.

So I think with that we're a minute over I'd love to keep going.

Roughly this exact same age roughly 45% 46 years old and there is a little older.

I just want to appreciate I appreciate everybody's time, sorry, we couldnt get to all the questions Bianca James will be following up with each of you excited about the future and giving more updates I'm also happy to join a few of these calls if any if any of you.

But.

We actually see some of our highest engagement on a per member basis from MAA as people get more concerned about their mobility there their interest in using hinged on a promoted basis goes up I think we have time for one more question.

Any questions for myself as well and really excited about the future ahead of using technology to automate the delivery of care where in the early innings. So stay tuned.

Your final question for today comes from the line of Brian Peterson with Raymond James Your line is open. Please go ahead.

This concludes today's call. Thank you for attending you may now disconnect.

Thanks for squeezing me in guys and congrats on the strong quarter, maybe for Dan or Jim just you have these new partnerships and everything on these market expansion youre growing revenue in the fifties, which was really rarefied air.

I'd really just like to understand how does the pipeline growth look relative to the billings or revenue growth and how should we be thinking about that in terms of greenfield versus competitive displacement. Thanks guys.

Yes.

So our pipeline growth.

Continues to be incredibly strong we're very pleased and again. It is like you said is a good leading indicator.

What ultimately bookings and revenue will look like in the outer years.

Think about the split between the competitive displacements and.

And Greenfield.

I'm focused on delivering the best experience that attracts.

Folks from other competitors to the hidden solution, but I think from a mix perspective, you still don't see the bulk of the growth coming from Greenfield just given how much unmet.

Unmet opportunity there is out there.

Great. Thank you.

And part of the revenue growth again will overtime comfort lives, but also through our increased enrollment yields as well to the both two sides of our growth point and as we continue to improve the product will earn the right to increase the ASP as well, which will give another growth lever beyond just lives.

And of course, new products that we're launching.

So I think with that we're a minute over I'd love to keep going.

I just want to appreciate I appreciate everybody's time, sorry, we couldn't get to all the questions Bianca James will be following up with each of you excited about the future and giving more updates I'm also happy to join a few of these calls if any.

Specific questions for myself as well and really excited about the future head of using technology to automate the delivery of care where in the early innings. So stay tuned.

Q2 2025 Hinge Health Inc Earnings Call

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