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CFO & Chief Administrative Officer Glenn Coleman detailed the drivers for fiscal 2027 growth, including a rebound in software renewals, continued advisory momentum, synergies from the Illumicare acquisition, sustained gross administrative fee growth, and significantly lower fee share headwinds. He confirmed the client termination payment was received in Q4 and its size was a component of a previous $15 million guidance increase for the Supply Chain Services segment.

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President and CEO Michael Alkire indicated that health systems maintain a cautious outlook due to persistent worries about tariffs, labor markets, and potential federal funding changes. Regarding utilization, he noted that Premier's data through the end of December showed low single-digit growth in the acute care setting, with the non-acute sector growing at a faster pace.

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CFO Glenn Coleman explained that the guidance conservatively assumes a lower gross administrative fee growth rate than the 5% achieved in the first half, creating potential for upside. He noted the main difference in the year-over-year comparison is the one-time member payment expected in Q4 of the current fiscal year.

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CFO Aaron Alt explained that while the company is focused on simplification and cost optimization, the vast majority of the SG&A increase was due to the inclusion of recent acquisitions like ION, GIA, and ADS. He noted that these acquisitions also present future synergy opportunities that will develop over time.

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CEO Jason Hollar stated that the company has not seen any specific negative trends and highlighted the historical resilience of pharmaceutical demand, even during significant economic downturns like the Great Recession. He emphasized that favorable secular trends, such as demographics and innovation, provide a strong foundation for the industry irrespective of macro scenarios.

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CFO Aaron Alt responded that while the company has not provided a specific number for the COVID-19 impact, it materialized as a modest headwind, consistent with their internal expectations. He noted the company was pleased to overcome this headwind, as demonstrated by the strong overall results in the Pharma segment.

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CEO Jason Hollar addressed the question by emphasizing that the company manages its business on gross margin dollars, not rate. He stated he would not take credit for a rate increase driven by a customer loss, highlighting that the key to their model is ensuring gross margin dollar growth outpaces SG&A growth, which was achieved in the quarter.

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CEO Jeff Tangney highlighted that over 75% of Scribe users are active weekly, making it a highly sticky product used during the workday, complementing the newsfeed's morning and evening usage. CFO Anna Bryson clarified that the Pathway acquisition will add just over $2 million in OpEx for the fiscal year, a figure that is already incorporated into the updated guidance.

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CEO Jeff Tangney credited the client portal for driving growth across the platform by providing frequent ROI data and reducing purchase friction. CFO Anna Bryson explained the stronger guidance by stating Doximity is in a much better competitive position than a year ago, with new products now proven and client budgets having stabilized, providing greater visibility and confidence despite the tougher comps.

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Co-Founder Dr. Nate Gross provided examples of AI use, such as drafting prior authorization appeals and patient letters, to reduce administrative burden. CFO Anna Bryson stated that while the market saw marginal improvement, the 'majority of our outperformance was due to share gains,' noting Doximity grew about 3x the market rate this year, compared to a historical norm of 2x.

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CFO Anna Bryson clarified that 20% of Q2 sales came from new workflow products like formulary and point-of-care, which are growing faster than the overall business. She stated the company believes these modules could become as large as the news feed business within 3-5 years. Regarding margins, she said it is too early to update long-term targets, as Doximity is still assessing the efficiency impacts of AI and the client portal while continuing to invest in them.

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CEO Dan Scavilla identified investing in the customer and the field sales team as top priorities. CFO Matt Garth clarified that the primary approach will be to repurpose funds from efficiency gains in corporate and other P&L areas to reinvest in the field and innovation. He indicated this would be refined during the upcoming strategic planning process, suggesting a focus on reallocation over significant new spending.

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CEO Simon Campion declined to provide new guidance for 2025 or 2026 but reiterated that achieving market growth in implants is a reasonable goal and that the primary challenge is execution, not portfolio gaps. Regarding the SKU optimization benefit, he stated that all transformation initiatives are on track and a more detailed update would be provided with year-end results.

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EVP & CFO Britt Vitalone confirmed that brand pricing trends are in line with expectations and the generics sourcing program is performing well without unusual pricing dynamics. CEO & Director Brian Tyler noted that while the tariff situation is uncertain, known factors are reflected in guidance, and he expressed confidence in the pharmaceutical supply chain's ability to buffer near-term impacts due to existing inventory levels.

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CEO Brian Tyler stated that the urgency to invest has been consistent, but past valuations were a challenge. He stressed that capital deployment remains driven by strategic alignment and financial discipline. CFO Britt Vitalone added that this approach is consistent with their long-term strategy of divesting assets like Change Healthcare and European businesses to reallocate capital to higher-return, differentiated platforms.

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CFO Britt Vitalone explained that the low OpEx growth reflects a multi-year focus on driving operating leverage through efficiency, automation, and data analytics. He noted that while the company is achieving greater efficiency, it continues to make strategic investments in growth areas like Prescription Technology Solutions (RxTS).

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Senior VP & CFO Ronald South explained that while glove pricing has stabilized sequentially, distribution gross margins will likely remain slightly below the prior year due to the competitive market. He noted that overall gross margin benefits from the mix shift towards higher-margin technology and specialty products. Both South and CEO Stanley Bergman confirmed that DSO expansion and de novo builds remain strong, with new office design projects showing double-digit year-over-year growth in most months of 2025.

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CEO Stanley Bergman suggested the implant market softness could be tied to weaker consumer sentiment for high-end procedures, while the lower-cost segment remains stable. He confirmed new products are being rolled out. Regarding build-outs, he clarified that activity for both de novo and existing practices is expanding more than in 2024, as DSOs and smaller practices have adjusted to the current interest rate environment.

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CEO Stanley Bergman explained the specialty segment's margin includes some lower-margin businesses and corporate brand management costs, but he expects margins to grow over time. CFO Ron South added that implant growth was healthy in Europe but tougher in the U.S., with more growth in the value segment. He noted no discernible impact from the Medicare Advantage coverage change.

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CEO Paul Keel stated that the company's modest price increases, which contributed about 1.5 points to growth, have been favorably received, as evidenced by strong 4% volume growth. He explained that the increases are below CPI and do not fully cover Envista's own input cost inflation, which customers seem to understand in the current environment.

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President and CEO Paul Keel and CFO Eric Hammes attributed the slight contraction in the Challenger business partly to a non-operational headwind from two fewer billing days in Q1. They affirmed this does not signal a change in trajectory and that the company remains focused on growing this under-indexed segment, expecting steady progress for both Challenger and Premium implants for the remainder of the year.

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CEO Paul Keel noted that while the pace of Spark's double-digit unit cost reductions may moderate, continued improvement is expected from a systematic manufacturing strategy. CFO Eric Hammes clarified that dealer inventory levels have been stable since Q2 2024, so no significant reversal or headwind is expected in 2025, with growth anticipated to align with sell-out trends.

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Randall Lipps, CEO, explained that price increases are part of an ongoing process and are tied to broader inflation rather than just tariffs. Nchacha Etta, CFO, added that gross margins are expected to benefit going forward from the scaling of SaaS and expert services businesses, as well as the positive impact from the XT Amplify innovation program.

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CEO Randall Lipps confirmed a positive trend, noting that specialty pharmacy has become a highly strategic topic for healthcare providers. He explained that this focus is elevating conversations from cost savings to revenue generation, particularly in outpatient settings, and that this momentum from late 2024 is continuing into the current year.

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CEO Randall Lipps confirmed that improving financial conditions for healthcare providers contributed to stronger-than-expected Q4 bookings, which provides good revenue visibility for 2025. He noted the business is stabilizing and expects sequential growth, aided by customer excitement for the XT Amplify program. Executive Kathleen Nemeth added that Specialty Pharmacy Services are also showing strong traction.

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CEO Randall Lipps attributed the strong Q4 forecast to improved business predictability and a robust implementation schedule, noting nothing was substantially different from Q3. Regarding specialty pharmacy, he explained that the market has broadened to smaller hospitals and complexity has increased, driving strong demand for Omnicell's expertise, particularly in middle and smaller markets.

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CEO Matt Hawkins described the demand environment as robust, with providers prioritizing efficiency and trusted, mission-critical platforms like Waystar. CFO Steve Oreskovich attributed the strong subscription revenue growth to continued strength and adoption of higher-margin provider solutions, which also contributed to the adjusted EBITDA margin outperformance.

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CEO Matt Hawkins affirmed that while Waystar has no direct tariff exposure, the company is empathetic to provider concerns. He stated that in difficult economic times, demand for efficiency and ROI-driven software like Waystar's remains strong, positioning them as a net share gainer. Regarding AI, Hawkins confirmed the existence of separate GenAI-focused budgets at large providers and noted that Waystar is actively engaging with these pools of capital, moving from 'AI hype to ROI reality' with solutions like AltitudeAI, though he did not quantify the size of these budgets.

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CFO Steve Oreskovich agreed with the general characterization, confirming that while the initial wave of new clients was a mix, the majority were from the ambulatory side. He affirmed that a 'phase 2' opportunity exists with larger health systems that initially weathered the disruption and are now evaluating their options, representing a continuing opportunity for Waystar.

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CFO James Lucania stated that the Q1 fraud cost of $3 million was in line with their internal forecast, so the outlook was not significantly altered, though they still aim for a 1 basis point run rate by the second half of the year. Founder & Vice Chairman Dr. Stephen Neeleman clarified the legislation would result in a net increase of 20 million eligible families, not a 40 million total increase.

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Vice Chair and Founder Dr. Steve Neeleman expressed continued optimism about legislative pathways for HSA expansion, noting ongoing discussions. EVP and CFO James Lucania confirmed that the company has a general crime policy and will work with its insurers to determine potential recovery for the fraud-related costs.

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Vice Chair and Founder Dr. Steve Neeleman explained that the company could immediately address the needs of working seniors currently on Medicare. For broader distribution, he stated HealthEquity would leverage its extensive network of health plan partners, many of whom have significant and growing Medicare Advantage populations, to market the new offerings through established channels.

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President and CEO Jon Kessler stated that typical second-half seasonality in service expense will remain due to new member enrollment and card delivery. EVP and CFO James Lucania added that while the goal is to lower the unit cost to serve an account each year, it's hard to keep absolute costs flat indefinitely due to factors like rising postage. He emphasized that efficiency gains allow for higher-skilled agents to handle complex issues rather than routine requests.

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CEO Peter Anevski clarified that revenue growth is not being driven by price increases. Instead, he attributed the growth almost entirely to higher member engagement, consumption, and overall activity resulting from a larger base of covered lives. He noted that any impact from drug price inflation in the pharmacy benefit was minimal.

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CEO Peter Anevski and President Michael Sturmer suggested new clients are more likely to adopt a full suite of services during their initial buying decision, but stressed that 20% adoption among the large existing client base is a significant success. CFO Mark Livingston stated the 2025 guidance methodology is consistent with prior periods, using current data while incorporating caution for potential variability.

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CFO Mark Livingston attributed the margin compression to two factors: pre-hiring staff for 2025 client launches and the unexpected shortfall in ART cycle revenue. He stated it was too early to provide 2025 margin guidance but noted hiring is being moderated. He also clarified that the 2025 lives calculation accounts for roughly 100,000 new lives that went live early and are already included in the current member base.

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CEO Wendy Barnes confirmed the primary driver of higher revenue per MAC was a mix shift toward higher-margin transactions at the pharmacy counter, part of a strategy to balance pharmacy profitability with competitive consumer pricing. She did not provide a specific breakdown for the MAC decline. CFO Chris McGinnis described the DC Rx acquisition as strategically important for deepening a key retail partnership, though its revenue contribution is immaterial.

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CEO Wendy Barnes clarified the primary driver of higher revenue per MAC is a mix shift toward higher-margin transactions at the pharmacy counter, which is balanced with maintaining competitive consumer pricing. She did not provide a specific delineation for the MAC decline. CFO Chris McGinnis described the DC Rx acquisition as financially immaterial but strategically important for deepening a key retail partnership.

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CFO Chris McGinnis responded that since a large portion of GoodRx's volume (up to 70%) is already on a cost-plus basis, the impact of broader adoption is not significant. He views the trend positively, as it supports a healthy retail pharmacy environment and an aligned economic model, which he believes will ultimately drive a higher revenue mix for GoodRx. He did not comment on specific changes to win rates.

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CFO Karsten Voermann explained that larger pharmacies are leveraging their scale to be more aggressive due to margin pressures, which could impact GoodRx's flow-through from PBM-adjudicated claims. Interim CEO Scott Wagner added that GoodRx's consumer usage growth remains healthy and that the company is growing share, making the issue a marginal dynamic.

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CEO Bob Mauch stated that while the company doesn't break out specific verticals, performance has been broad-based across all sites of care, including community specialty and health systems, with oncology remaining the largest growth area. CFO Jim Cleary added that strong utilization and broad specialty strength drove the significant U.S. operating income guidance increase.

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CFO James Cleary acknowledged the strong utilization trends seen in FY24 and Q1 FY25. He explained that the guidance range exists to account for various assumptions on utilization for the rest of the year, while expressing high confidence in the market's resilience and Cencora's performance with market-leading customers.

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Lazarus Krikorian, SVP and Chief Accounting Officer, confirmed GLP-1s were a primary driver, with sales up 55% year-over-year. He also emphasized that continued strong growth in specialty product distribution to physician practices and health systems was another significant contributor to the top-line performance.

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Executive Jonathan Leon stated that new patient starts for NIV and oxygen began to pick up late in the year after the company adjusted to new reimbursement requirements. Executive Edward Pesicka commented that glove pricing has 'somewhat leveled out' after a period of decline and may rise in the future, driven by factors like tariffs.

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Executive Edward Pesicka attributed the margin expansion to both fixed cost leverage and gross margin improvements driven by optimizing the 'Sleep Journey' program and enhancing revenue cycle management. He expressed confidence that the relentless focus on process and service improvements should allow for continued year-over-year margin expansion in the segment, while also acknowledging the business's natural seasonality.

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The guidance for the second half implies a low single-digit growth environment for dental consumables, similar to Q2, with no significant uptick projected. Regarding the Change Healthcare recovery, the company stated the business is on track with its budget. While not providing a percentage of customers recovered, they quantified the headwind from last year's Q4 at $0.06, which will become a favorable year-over-year comparison in the upcoming Q4.

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The company identified the Change Healthcare impact as the larger of the two issues affecting Dental consumables. The UPS strike-related comp was described as less significant. For the companion animal segment, the expectation is that they will return to a normal cadence on rebates as the year progresses and get the business back on track to meet its budget.

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The company views patient traffic as steady and favorable. They stated that spending on distribution centers will normalize in Q4, but software investments are more sustaining, though an overall step down in related expenses is expected in Q4.

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CFO Yemi Okupe stated that the subscriber base excluding GLP-1s grew over 40% year-over-year, indirectly indicating strong core growth. CEO Andrew Dudum described a durable long-term weight loss strategy built on a diverse portfolio, including a successful oral medication business, the upcoming generic liraglutide in 2025, and hyper-personalized semaglutide to mitigate side effects, which he believes will remain a critical need regardless of drug shortage status.

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CEO Chuck Divita stated his view that the company is already spending enough in this area. He explained the focus is on rationalizing the portfolio to align with key imperatives, which will allow them to both reduce overall spend over time and free up capacity for new, critical capabilities. He noted progress has already been made in reducing total T&D spend.

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Chief Executive Officer Chuck Divita stated his view that the company is already spending enough in this area and the focus is on rationalizing the portfolio. The goal is to align spending with key imperatives, which will allow Teladoc to both bring the overall spend down over time and free up capacity for new, critical capabilities. He noted this continues a trend of managing T&D spend down, creating efficiencies to fund future investments while delivering solid financial performance.

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Rajeev Singh described the DeVry relationship as a deep partnership where Accolade serves as a strategic adviser on overall healthcare strategy. He affirmed that the company aims to play this broader role with all its customers, using the DeVry case as a key example to demonstrate this capability and value proposition.

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