NantHealth, Inc.
Q2 2022 Earnings Call Transcript

Published: 6 Aug 2022

[Robert Jaffe:]

Welcome, everyone, and thank you for joining us today to discuss NantHealth's 2022 second quarter financial results. On the call today are Ron Louks, Chief Operating Officer; and Bob Petrou, our Chief Financial Officer. This call is being broadcast live at www.nanthealth.com. A playback will be available for three months on NantHealth's website. I would like to make the cautionary statement and remind everyone that forward-looking information discussed on today's call is covered under the safe harbor provisions of the Litigation Reform Act. The company's discussion today will include forward-looking information reflecting management's current forecast of certain aspects of the company's future, and actual results could differ materially from those stated or implied. In addition, during the course of this call, we refer to non-GAAP financial measures that are not prepared in accordance with U.S. generally accepted accounting principles and may be different from non-GAAP financial measures used by other companies. Investors are encouraged to review NantHealth's press release announcing its full 2022 second quarter financial results for the company's reasons for including those non-GAAP financial measures in its financial results announcement. Reconciliation of non-GAAP financial measures to the most directly comparable GAAP financial measures is also attached in the company's earnings press release issued earlier today. In a moment, Ron will discuss the business, followed by Bob, who will discuss the financial results. We will then open the call for questions. With that said, I will now turn the call over to Ron Louks. Ron?

[Ron Louks:]

Thanks, Robert. Good afternoon, everyone, and welcome to NantHealth's 2022 Second Quarter Financial Results Conference Call. Turning briefly to our financial performance. We reported total revenue of $16.5 million, the third consecutive quarter of top line growth. Gross margin for the quarter was 55%. As we have been saying for several quarters, central to our growth strategy is a commitment to investing in our products and services. As you will hear in a moment, during the quarter we continued to launch new products, enhanced existing ones, and with regard to our Eviti Connect for autoimmune disease program, we continued to roll out new drugs and new drug regimens. Now let's discuss our Software and Services business, beginning with our Eviti business. In the second quarter, Eviti Connect for Oncology won the Spring Digital Health "Connected Digital Health Merit Award", in recognition of the product's credibility and relevance of content and design. We received approval for full Delegated Entity status in 3 additional states

[Bob Petrou:]

Thank you, Ron. For Q2 2022, total revenue was $16.5 million compared with $16.1 million in the prior year second quarter. The year-on-year increase was mainly due to growth in increased Eviti services from the previous year. Year-to-date, revenue from 2022 is up approximately 2% from the same period last year. Gross profit for the quarter was $9.2 million, which is a slight increase from $9.1 million in the same quarter last year. Gross profit percent was 55%, down from 56% this quarter last year. Total operating expenses increased 15% to $20.9 million from $17.7 million in the prior year second quarter. This is a function of the continued investments we are making in our product portfolios and our platform and infrastructure technology build-out. For Q2 2022, net loss from continuing operations was $12.5 million or $0.11 per share. This is compared with $15.5 million or $0.13 per share in the prior year second quarter. On a non-GAAP basis, net loss from continuing operations in Q2 2022 was $11.4 million, or $0.10 per share. This compared with $9 million or $0.08 per share for the second quarter of last year. Finally, cash and cash equivalents were approximately $5.7 million at June 30, 2022, which is compared with $16.1 million at March 31, 2022. Usage of cash was approximately $10.4 million, which was driven by interest payments, labor expenses and other working capital needs. With that, I will now turn the call back over to Robert.

[Robert Jaffe:]

Thanks, Bob. Operator, that completes our prepared remarks. We'd now like to open the call to questions.

[Operator:]

[Operator:]

There are no questions at this time. I'll now turn the call back to you. Please continue with the presentation and/or closing remarks.

[Robert Jaffe:]

Thanks, operator, and thank you, everyone, for joining us today. We look forward to sharing our progress on the next planned conference call. Have a great night.