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AI

Augmedix, Inc. (AUGX)·Q4 2023 Earnings Summary

Executive Summary

  • Q4 2023 revenue grew 45% year over year to $12.68M, with gross margin expanding 300 bps to 49.3% and adjusted EBITDA loss improving to $3.31M; management introduced FY2024 revenue guidance of $60–$62M .
  • Key operational drivers included 44% growth in clinicians in service, net revenue retention of 152%, and early traction of Augmedix Go in ambulatory; ER Go was targeted for GA by end of March, with partner HCA planning a broad roll-out across its hospital network .
  • Cash burn improved materially; operating cash burn was $0.9M in Q4 and cash and equivalents ended at $46.2M following the November equity raise, supporting accelerated investments and product scaling .
  • Near-term watch items: management guided Q1 2024 revenue of ~$13.4M and a temporary ~300 bps sequential gross margin dip from Bangladesh facility migration and India optimization, before resuming expansion, and signaled 2024 GAAP OpEx in the mid-to-upper $50M range—potential catalysts around Go commercialization, HCA deployment tempo, and margin trajectory normalization .

What Went Well and What Went Wrong

What Went Well

  • Strong topline and margin expansion: Revenue +45% YoY to $12.68M and gross margin +300 bps to 49.3%; adjusted EBITDA loss improved to $3.31M .
  • Commercial traction and KPIs: Dollar-based net revenue retention reached 152% and average clinicians in service rose to 1,789 (+44%)—evidence of deeper enterprise penetration and user growth .
  • Product momentum and strategic positioning: “We are pleased with the early performance of Augmedix Go… Feedback has been encouraging… Initial orders… met our expectations… ER version… on track for GA by the end of March. Independently, our strategic partner HCA Healthcare is making plans for a broad roll-out” .

What Went Wrong

  • Continued net losses despite improvement: GAAP net loss of $4.49M and adjusted operating expenses up 12% to $9.90M reflect the investment phase and scaling costs .
  • Interest expense and debt service: Interest expense increased to $0.65M in Q4; total loan payable increased versus 2022, pressuring bottom-line until scale and margins expand further .
  • Near-term margin headwinds flagged: Management guided a ~300 bps sequential gross margin dip in Q1 from temporary operational items (Bangladesh move and India optimization), pushing out margin normalization to May .

Financial Results

Quarterly P&L and Profitability (oldest → newest)

MetricQ2 2023Q3 2023Q4 2023
Revenue ($USD Millions)$10.78 $11.77 $12.68
Gross Margin (%)47.0% 49.5% 49.3%
Net Loss ($USD Millions)$(5.03) $(4.41) $(4.49)
Diluted EPS ($USD)$(0.12) $(0.10) $(0.09)
Adjusted EBITDA ($USD Millions)$(3.60) $(3.08) $(3.31)

Notes:

  • Adjusted EBITDA definition was modified in Q4 2023 to exclude interest income on larger cash balances and FX gains/losses; prior periods recast to conform .

YoY Q4 Comparison

MetricQ4 2022Q4 2023YoY Change
Revenue ($USD Millions)$8.75 $12.68 +45%
Gross Margin (%)46.3% 49.3% +300 bps
Net Loss ($USD Millions)$(5.60) $(4.49) +20% (improvement)
Diluted EPS ($USD)$(0.15) $(0.09) +40% (improvement)
Adjusted EBITDA ($USD Millions)$(4.47) $(3.31) +26% (improvement)

KPIs and Operating Metrics

KPIQ2 2023Q3 2023Q4 2023
Average Clinicians in Service (count)1,534 1,650 1,789
Dollar-based Net Revenue Retention (%)148% 157% 152%
Avg Annual Revenue per Clinician ($USD)——$28,200
Operating Cash Burn ($USD Millions, Q4)——$0.9
Cash & Equivalents ($USD Millions, YE)——$46.2

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Revenue ($USD Millions)FY 2023≥$43.5 (Aug 7, 2023) ~$44.5 (Nov 6, 2023) Raised
Revenue ($USD Millions)Q4 2023~$12.3 (prior internal target) ~$12.5 pre-announced (Jan 5, 2024) Raised
Revenue ($USD Millions)FY 2024—$60–$62 (Mar 18, 2024) New
Revenue ($USD Millions)Q1 2024—~$13.4 (call) New
GAAP Gross Margin (bps q/q)Q1 2024—~−300 bps vs Q4, temporary; resume uptrend by May New
GAAP Operating Expenses ($USD Millions)FY 2024—Mid-to-upper $50s, reflecting incremental ~$9M investments (S&M, engineering) New
Product Launch TimelineER Augmedix Go—GA by end of March New

Earnings Call Themes & Trends

TopicPrevious Mentions (Q2 & Q3)Current Period (Q4 2023)Trend
Ambient AI (Augmedix Go)Early access Go; high interest; launch targeted later in 2023; collaboration with HCA & Google Cloud Ambulatory GA achieved; ER GA targeted by end of March; positive early feedback and initial orders Advancing commercialization
Structured data & platformEmphasis on structured data and bi-directional communication; strategic collaborations with digital health partners Continued positioning as point-of-care information delivery platform; differentiation highlighted Strengthening ecosystem
Clinician adoptionCIS up 48% (Q2) and 47% (Q3); retention 148–157% CIS up 44% YoY; retention at 152% Sustained growth
Margin trajectoryGM expansion +330 bps (Q2), +390 bps (Q3) GM +300 bps YoY in Q4; guided temporary dip in Q1 before resumption in May Upward medium-term
Capital & investmentsBalance sheet strengthened (Q2 term loan extension); equity raise in Nov Cash $46.2M YE; plan to invest +$9M vs prior plan in 2024 Accelerated spend for growth
Security/ComplianceAchieved HITRUST certification (Q3) Continued emphasis on trust and compliance in differentiation Ongoing differentiator

Management Commentary

  • CEO on performance and Go traction: “We delivered a 45% increase in revenue to $12.7 million… gross profit by 54% to $6.2 million… We are pleased with the early performance of Augmedix Go… Initial orders… have met our expectations… ER version of Augmedix Go is on track for its own General Availability… HCA Healthcare is making plans for a broad roll-out” .
  • Strategic positioning: “Our broad portfolio… automated documentation… structured data… bi-directional communication… HITRUST certification… provide Augmedix with a differentiated offering… In 2024, we anticipate another year of strong growth and continued gross margin expansion…” .
  • CFO on adjusted EBITDA methodology: Beginning Q4, adjusted EBITDA excludes interest income, FX gains/losses, and certain grant income; prior periods recast for consistency .

Q&A Highlights

  • Near-term guidance color: “We expect revenue in the first quarter to be approximately $13.4 million. We expect GAAP gross margins to be lower, quarter-on-quarter by about 300 basis points… due to temporary costs… Bangladesh… and… India… We expect gross margins to resume their upward trajectory in May… invest an incremental $9 million in 2024… appropriate to expect GAAP operating expenses to be in the mid to upper $50 million range in 2024” .
  • Product mix commentary: On “Prep” traction—“I just signed an order for more Prep at one of our biggest customers… It’s still a fraction of our revenues… but… demand… will expand as people become more aware of it” .
  • Partnership updates: Discussion of Google partnership as part of data and platform strategy; continued alignment with HCA for ER Go .

Estimates Context

  • S&P Global Wall Street consensus data was unavailable in our system for AUGX at the time of this analysis (mapping error prevented retrieval). Therefore, estimate comparisons to SPGI consensus cannot be provided.
  • Third-party sources indicated Q4 EPS of $(0.09) versus expectations of $(0.10), implying a beat; revenue expectations were not reliably available from SPGI for formal comparison .

Key Takeaways for Investors

  • Growth durability: Sustained double-digit YoY growth with enterprise net retention of 152% and rising CIS suggest strong cohort expansion and product adoption, supporting FY2024 guidance of $60–$62M .
  • Margin path: Despite a guided temporary Q1 gross margin dip (~300 bps), management expects margins to resume their uptrend by May; monitor operational normalization from facility moves and optimizations .
  • Product catalysts: Go commercialization across ambulatory and ER, plus HCA network roll-out, are pivotal to mix and margin leverage; execution tempo here is likely a stock narrative driver .
  • Balance sheet and investment: With $46.2M in cash and planned ~$9M incremental 2024 investments, the company is positioned to accelerate go-to-market and engineering to capture share; watch OpEx scaling vs revenue and gross margin progression .
  • Estimates gap: SPGI consensus data was not retrievable; near-term updates may lead to estimate revisions as Go ramps and margin trends re-accelerate—expect tighter models post-Q1 update cycle.
  • Trading setup: Near-term catalysts include ER Go GA timing, HCA deployment visibility, and confirmation of margin normalization by May; any upside surprise on Q1 revenue (~$13.4M guide) or faster Go contribution could re-rate expectations .
  • Medium-term thesis: A broad ambient AI portfolio, structured data moat, and point-of-care delivery channel, backed by HITRUST certification and enterprise relationships, support a path to scale, margin expansion, and improved cash dynamics over 2024–2025 .