NextGen Healthcare (NYSE:NXGN) Q2 2021 Earnings Conference Call - Final Transcript

Welcome to the NextGen Healthcare Fiscal 2021 Second Quarter Results Conference Call. Hosting the call today from NextGen are Rusty Frantz, President and Chief Executive Officer; and Jamie Arnold, Chief Financial Officer. [Operator Instructions]

Before we start, I'd like to remind everyone that the comments made on this call may include statements that are forward-looking within the meaning of federal securities laws, including and without limitations, statements related to anticipated industry trends, and the Company's plans, future performance, products, perspectives and strategies. Risk and uncertainties that may cause results to differ materially from those expressed in these forward-looking statements, including among others, those risks set forth in the Company's public filing with the US Securities and Exchange Commission, including the discussion under the heading Risk Factors in the Company's most recent annual report on the Form 10-K and any subsequent quarterly report on Form 10-Q. Any forward-looking statements speaks only as of today. The Company expressly disclaims any intent or obligation to update these forward-looking statements.

Our remarks on today's call include both our earnings results and guidance, which contains certain non-GAAP financial measures. For our earning results, the GAAP financial measures most directly comparable to each non-GAAP financial measure used or discussed and a reconciliation of the differences between each non-GAAP financial measure and the comparable GAAP financial measure can be found within our latest quarterly earnings press release that was filed with the SEC and is posted to the Investors section of our website. This release also provides qualitative description of how we have calculated non-GAAP financial measures contained in our guidance.

At this time, I would like to turn the call over to Mr. Rusty Frantz, President and CEO of NextGen. Sir, you may begin.

Thank you, operator. Q2 FY '21 is a great example of NextGen's operational and financial strength and our ability to continue to execute and advance our strategy during a complex time. On today's call, we will highlight the following. NextGen's strong Q2 performance across almost every operational metric, including revenue, earnings and free cash flow, as well as continuing strong growth in subscription services. Our delivery of the best overall client experience in the independent ambulatory market is showing up in commercial wins both inside and outside the base. Our intention to further capitalize on the commercial success of our expanded solution by opening significant long-term market opportunity through bringing our client base onto the Spring 2021 release, which notably includes our newly acquired patient experience platform. And at the close of our remarks, we will provide guidance for FY '21, as we now have better visibility and understanding of the range of business impacts from COVID.

Let's start with Q2 operational performance. Our revenue for the quarter came in at $140 million, an increase of 4.3% year-over-year and 7% quarter-over-quarter. As it has been for a number of years, subscription services revenue continued its mid to high teens growth rate, accounting for $36.9 million and representing 17.4% year-over-year and 4.3% quarter-over-quarter growth.