Waystar Reports Fourth Quarter and Fiscal Year 2024 Results

Fiscal year 2024 revenue of $944M, up 19% YoY

Q4 revenue growth of 18% year-over-year

Q4 net income of $19.1 million and non-GAAP net income of $52.1 million

Fiscal year 2024 net loss $19.1 million, 62.7% improvement YoY

Fiscal year 2024 adjusted EBITDA of $383M, up 15% YoY

Q4 net income margin of 8%; adjusted EBITDA margin of 41%

LEHI, Utah and LOUISVILLE, Ky., Feb. 18, 2025 /PRNewswire/ -- Waystar Holding Corp. (Nasdaq: WAY), a provider of leading healthcare payment software, today reported results for the fourth quarter and full year ended December 31, 2024.

"We are pleased to report strong results for the fourth quarter and full year 2024, exceeding expectations and reflecting the successful execution of our strategic priorities," said Matt Hawkins, Chief Executive Officer of Waystar. "By leveraging the power of our cloud-based software platform, we have consistently delivered measurable return on investment for our clients."

Hawkins continued, "Looking ahead, we expect to achieve solid revenue growth at scale, paired with compelling adjusted EBITDA margins, positioning us for continued success."

Fourth Quarter 2024 Financial Highlights

    --  Revenue of $244.1 million, up 18% year-over-year
    --  Net income of $19.1 million, GAAP net income per share of $0.11, and net
        income margin of 8%
    --  Non-GAAP net income of $52.1 million and non-GAAP net income per diluted
        share of $0.29
    --  Adjusted EBITDA of $100.2 million and adjusted EBITDA margin of 41%
    --  Cash flow from operations of $65 million and unlevered free cash flow of
        $80 million

Key Metrics and Revenue Disaggregation

    --  1,203 clients contributed over $100,000 in LTM revenue, up 15%
        year-over-year
    --  Net revenue retention rate (NRR) of 110%
    --  Subscription revenue of $121.6 million, up 18% year-over-year
    --  Volume-based revenue of $121.2 million, up 19% year-over-year

Financial Outlook

As of February 18, 2025, Waystar provides the following guidance for its full fiscal year 2025.(1)

    --  Total revenue is expected to be between $1.0 billion and $1.016 billion
    --  Adjusted EBITDA is expected to be between $399 million and $407 million
    --  Non-GAAP net income is expected to be between $237 million and $243
        million
    --  Diluted non-GAAP net income per share is expected to be between $1.29
        and $1.32

Webcast Information

Waystar's financial results will be discussed on a conference call scheduled at 8:30 a.m. Eastern Standard Time today, February 18, 2025. A live audio conference call will be available on Waystar's website at https://investors.waystar.com/news-events/events. The webcast will be archived on the site for those unable to listen in real time. This earnings release and the related Current Report on Form 8-K filed February 18, 2025 can be accessed on the Investor Relations page of the company's website. We routinely post important information on our website, including corporate and investor presentations and financial information. We intend to use our website as a means of disclosing material, non-public information and for complying with our disclosure obligations under Regulation FD. Such disclosures will be included in the Investor Relations section of our website. Accordingly, investors should monitor this portion of our website, in addition to following our press releases, U.S. Securities and Exchange Commission ("SEC") filings, and public conference calls and webcasts.

Non-GAAP Financial Measures

To supplement the consolidated financial statements prepared and presented in accordance with U.S. generally accepted accounting principles ("GAAP"), this press release contains certain non-GAAP financial measures as defined below. We present non-GAAP financial measures as supplemental measures of financial performance that are not required by, or presented in accordance with, GAAP. We believe they assist investors and analysts in comparing our operating performance across reporting periods on a consistent basis by excluding items that we do not believe are indicative of our core operating performance. Management believes these non-GAAP financial measures are useful to investors in highlighting trends in our operating performance, while other measures can differ significantly depending on long-term strategic decisions regarding capital structure, the tax jurisdictions in which we operate, and capital investments. Management uses adjusted EBITDA and adjusted EBITDA margin to supplement GAAP measures of performance in the evaluation of the effectiveness of our business strategies, to make budgeting decisions, to establish discretionary annual incentive compensation, and to compare our performance against that of other peer companies using similar measures. Management supplements GAAP results with non-GAAP financial measures to provide a more complete understanding of the factors and trends affecting the business than GAAP results alone provide.

Adjusted EBITDA, adjusted EBITDA margin, non-GAAP net income, non-GAAP net income per share and unlevered free cash flow are not recognized terms under GAAP and should not be considered as an alternative to net income (loss) or net income (loss) margin as measures of financial performance or cash provided by operating activities as a measure of liquidity, or any other performance measure derived in accordance with GAAP. Additionally, these measures are not intended to be a measure of free cash flow available for management's discretionary use, as they do not consider certain cash requirements such as interest payments, tax payments, and debt service requirements. The presentations of these measures have limitations as analytical tools and should not be considered in isolation, or as a substitute for analysis of our results as reported under GAAP. Because not all companies use identical calculations, the presentations of these measures may not be comparable to other similarly titled measures of other companies and can differ significantly from company to company. A reconciliation is provided below for our non-GAAP financial measures to the most directly comparable financial measure stated in accordance with GAAP. Investors are encouraged to review the related GAAP financial measures and the reconciliation of non-GAAP financial measures to their most directly comparable GAAP financial measures, and not to rely on any single financial measure to evaluate our business.

The following non-GAAP financial measures and key performance metrics are defined below:

Adjusted EBITDA and adjusted EBITDA Margin
We define adjusted EBITDA as net loss before interest expense, net income tax benefit, depreciation and amortization, and as further adjusted for stock-based compensation expense, acquisition and integration costs, asset and lease impairments, costs related to amended debt agreements, and IPO related costs. Adjusted EBITDA margin represents adjusted EBITDA as a percentage of revenue.

Non-GAAP Net Income and Non-GAAP Net Income Per Share
We define non-GAAP net income as GAAP net income excluding the impact of stock-based compensation, acquisition and integration costs, asset and lease impairments, IPO related costs, costs related to amended debt agreements and amortization of intangibles. We updated the definition of non-GAAP net income to include amortization of intangibles to align with a more common definition used by our peers. We have revised prior year disclosures to align with this updated definition. The tax effects of the adjustments are calculated using a management-estimated annual effective non-GAAP tax rate of 21%.

We define non-GAAP net income per share as non-GAAP net income (loss) divided by weighted-average shares used to compute net loss per share.

Unlevered Free Cash Flow
We define unlevered free cash flow as cash from operations plus cash interest expense less capital expenses.

Net Debt
We define net debt as the sum of the current portion of long-term debt, long-term debt, and accounts receivable securitization less cash and equivalents.

Adjusted Net Leverage Ratio
We define adjusted net leverage ratio as net debt divided by adjusted EBITDA over the preceding twelve months.

Key Performance Metrics

Net Revenue Retention Rate
Our Net Revenue Retention Rate compares twelve months of client invoices for our solutions at two period end dates. To calculate our Net Revenue Retention Rate, we first accumulate the total amount invoiced during the twelve months ending with the prior period-end or Prior Period Invoices. We then calculate the total amount invoiced to those same clients for the twelve months ending with the current period-end, or Current Period Invoices. Current Period Invoices are inclusive of upsell, downsell, pricing changes, clients that cancel or chose not to renew, and discontinued solutions with continuing clients. The Net Revenue Retention Rate is then calculated by dividing the Current Period Invoices by the Prior Period Invoices. Our total invoices included in the analysis are greater than 98% of reported revenue. We use Net Revenue Retention Rate to evaluate our ongoing operations and for internal planning and forecasting purposes. Acquired businesses are included in the last-twelve-month Net Revenue Retention Rate in the ninth quarter after acquisition, which is the earliest point that comparable post-acquisition invoices are available for both the current and prior twelve-month period.

Customer Count with >$100,000 of Revenue
We regularly monitor and review our count of clients who generate more than $100,000 of revenue.

Our count of clients who generate more than $100,000 of revenue is based on an accumulation of the amounts invoiced to clients over the preceding twelve months. The invoices for acquired clients are included starting in the first full calendar quarter after the date of acquisition.

Forward-Looking Statements

This press release contains forward-looking statements, within the meaning of the Private Securities Litigation Reform Act of 1995, that reflect our current views with respect to, among other things, statements regarding Waystar's expectations relating to future operating results and financial position, including full year 2025, and future periods; the performance of our new product offerings; our industry and market opportunities, business strategy, goals, and expectations concerning our market position, future operations, margins and profitability, capital expenditures, liquidity, and capital resources and other financial and operating information. Forward-looking statements include all statements that are not historical facts. These statements may include words such as "anticipate," "assume," "believe," "continue," "could," "estimate," "expect," "intend," "may," "plan," "potential," "predict," "project," "future," "will," "seek," "foreseeable," "outlook," the negative version of these words or similar terms and phrases to identify forward-looking statements in this press release, including the discussion of outlook for full fiscal year 2025.

The forward-looking statements contained in this press release are based on management's current expectations and are not guarantees of future performance. The forward-looking statements are subject to various risks, uncertainties, assumptions, or changes in circumstances that are difficult to predict or quantify. Our expectations, beliefs, and projections are expressed in good faith, and we believe there is a reasonable basis for them. However, there can be no assurance that management's expectations, beliefs, and projections will result or be achieved. The following factors are among those that may cause actual results to differ materially from the forward-looking statements: our operation in a highly competitive industry; our ability to retain our existing clients and attract new clients; our ability to successfully execute on our business strategies in order to grow; our ability to accurately assess the risks related to acquisitions and successfully integrate acquired businesses; our ability to establish and maintain strategic relationships; the growth and success of our clients and overall healthcare transaction volumes; consolidation in the healthcare industry; our selling cycle of variable length to secure new client agreements; our implementation cycle that is dependent on our clients' timing and resources; our dependence on our senior management team and certain key employees, and our ability to attract and retain highly skilled employees; the accuracy of the estimates and assumptions we use to determine the size of our total addressable market; our ability to develop and market new solutions, or enhance our existing solutions, to respond to technological changes, or evolving industry standards; the interoperability, connectivity, and integration of our solutions with our clients' and their vendors' networks and infrastructures; the performance and reliability of internet, mobile, and other infrastructure; the consequences if we cannot obtain, process, use, disclose, or distribute the highly regulated data we require to provide our solutions; our reliance on certain third-party vendors and providers; any errors or malfunctions in our products and solutions; failure by our clients to obtain proper permissions or provide us with accurate and appropriate information; the potential for embezzlement, identity theft, or other similar illegal behavior by our employees or vendors, and a failure of our employees or vendors to observe quality standards or adhere to environmental, social, and governance standards; our compliance with the applicable rules of the National Automated Clearing House Association and the applicable requirements of card networks; increases in card network fees and other changes to fee arrangements; the effect of payer and provider conduct which we cannot control; privacy concerns and security breaches or incidents relating to our platform; the complex and evolving laws and regulations regarding privacy, data protection, and cybersecurity; our ability to adequately protect and enforce our intellectual property rights; our ability to use or license data and integrate third-party technologies; our use of "open source" software; legal proceedings initiated by third parties alleging that we are infringing or otherwise violating their intellectual property rights; claims that our employees, consultants, or independent contractors have wrongfully used or disclosed confidential information of third parties; the heavily regulated industry in which we conduct business; the uncertain and evolving healthcare regulatory and political framework; healthcare laws and data privacy and security laws and regulations governing our processing of personal information; reduced revenues in response to changes to the healthcare regulatory landscape; legal, regulatory, and other proceedings that could result in adverse outcomes; consumer protection laws and regulations; contractual obligations requiring compliance with certain provisions of the Bank Secrecy Act and anti-money laundering laws and regulations; existing laws that regulate our ability to engage in certain marketing activities; our full compliance with website accessibility standards; any changes in our tax rates, the adoption of new tax legislation, or exposure to additional tax liabilities; limitations on our ability to use our net operating losses to offset future taxable income; losses due to asset impairment charges; restrictive covenants in the agreements governing our credit facilities; interest rate fluctuations; unavailability of additional capital on acceptable terms or at all; the impact of general macroeconomic conditions; actions of certain of our significant investors, who may have different interests than the interests of other holders of our securities; and each of the other factors discussed under the heading of "Risk Factors" in the Company's 10K filed with the Securities and Exchange Commission (the "SEC") on February 18, 2025, our prospectus filed with the Securities and Exchange Commission (the "SEC") on June 7, 2024, and in other reports filed with the SEC, all of which are available on the Investor Relations page of our website at investors.waystar.com.

Any forward-looking statements made by us in this press release speak only as of the date of this press release and are expressly qualified in their entirety by the cautionary statements included in this press release. Factors or events that could cause our actual results to differ may emerge from time to time, and it is not possible for us to predict all of them. You should not place undue reliance on our forward-looking statements. We undertake no obligation to publicly update or review any forward-looking statement, whether as a result of new information, future developments, or otherwise, except as may be required by any applicable securities laws.

About Waystar

Waystar's mission-critical software is purpose-built to simplify healthcare payments so providers can prioritize patient care and optimize their financial performance. Waystar serves approximately 30,000 clients, representing over 1 million distinct providers, including 16 of 20 institutions on the U.S. News Best Hospitals list. Waystar's enterprise-grade platform annually processes over 6 billion healthcare payment transactions, including over $1.8 trillion in annual gross claims and spanning approximately 50% of U.S. patients. Waystar strives to transform healthcare payments so providers can focus on what matters most: their patients and communities. Discover the way forward at waystar.com.





     
     (1) We have not reconciled the forward-looking adjusted EBITDA, non-GAAP net income, and non-GAAP net income per share guidance included above to the most directly comparable GAAP measure because this cannot be done without
              unreasonable effort due to the variability and low visibility with respect to certain costs, the most significant of which are incentive compensation (including stock-based compensation), transaction-related expenses, and certain
              fair value measurements, which are potential adjustments to future earnings. We expect the variability of these items to have a potentially unpredictable, and a potentially significant, impact on our future GAAP financial results.


                                                    
              
                Waystar


                                     
              
                Consolidated Statements of Operations


                              
              
                (in thousands, except for share and per share data)


                                                  
              
                (unaudited)




                                                                                                         Three months ended             Twelve months ended
                                                                                                     December 31,                 December 31,



                                                                                                     2024               2023        2024                       2023



     Revenue                                                                                     244,102            206,695     943,549                    791,010



     Operating expenses



     Cost of revenue (exclusive of depreciation


     and amortization expenses)                                                                   79,542             67,190     315,730                    249,767



     Sales and marketing                                                                          38,990             30,946     156,935                    124,437



     General and administrative                                                                   22,959             16,400     111,753                     62,924



     Research and development                                                                     11,472              9,785      48,775                     35,332



     Depreciation and amortization                                                                37,996             44,686     186,631                    176,467



     Total operating expenses                                                                    190,959            169,007     819,824                    648,927



     Income from operations                                                                       53,143             37,688     123,725                    142,083



     Other expense



     Interest expense                                                                           (19,003)          (51,262)  (141,762)   (198,309)



     Related party interest expense                                                              (1,083)           (1,598)    (4,508)                   (7,608)



     Income/(loss) before income taxes                                                            33,057           (15,172)   (22,545)                  (63,834)



     Income tax expense/(benefit)                                                                 13,978              (757)    (3,420)                  (12,500)



     Net income/(loss)                                                                            19,079           (14,415)   (19,125)                  (51,334)



     Net income/(loss) per share:



     Basic                                                                                          0.11             (0.12)     (0.13)                    (0.42)



     Diluted                                                                                        0.11             (0.12)     (0.13)                    (0.42)



     Weighted-average shares outstanding:



     Basic                                                                                   172,526,776        121,679,113 149,915,839                121,675,430



     Diluted                                                                                 179,112,559        121,679,113 149,915,839                121,675,430


                                                                           
              
                Waystar


                                                                 
              
                Consolidated Balance Sheets


                                                     
              
                (in thousands, except for share and per share data)




                                                                                                                                                                              December 31, December 31,
                                                                                                                                                                                   2024          2023



     Assets



     Current assets



     Cash and cash equivalents                                                                                                                                                    182,133        35,580



     Restricted cash                                                                                                                                                               22,449         9,848



     Accounts receivable, net of allowance of $5,885 at December 31, 2024 and                                                                                                     145,235       126,089
                                                                                                                                                            $5,335 at December 31, 2023



     Income tax receivable                                                                                                                                                          2,838         6,811



     Prepaid expenses                                                                                                                                                              14,414        13,296



     Other current assets                                                                                                                                                           3,972        30,426



     Total current assets                                                                                                                                                         371,041       222,050



     Property, plant and equipment, net                                                                                                                                            46,731        61,259



     Operating lease right-of-use assets, net                                                                                                                                      10,820        10,353



     Intangible assets, net                                                                                                                                                     1,039,049     1,186,936



     Goodwill                                                                                                                                                                   3,019,999     3,030,013



     Deferred costs                                                                                                                                                                82,815        65,811



     Other long-term assets                                                                                                                                                         6,549         6,552



     Total assets                                                                                                                                                               4,577,004     4,582,974



     Liabilities and stockholders' equity



     Current liabilities



     Accounts payable                                                                                                                                                              47,365        45,484



     Accrued compensation                                                                                                                                                          31,589        23,286



     Aggregated funds payable                                                                                                                                                      22,059         9,659



     Other accrued expenses                                                                                                                                                        15,930        10,923



     Deferred revenue                                                                                                                                                              10,527        10,935



     Current portion of long-term debt                                                                                                                                             11,311        17,454



     Related party current portion of long-term debt                                                                                                                                  357           529



     Current portion of operating lease liabilities                                                                                                                                 5,591         4,398



     Current portion of finance lease liabilities                                                                                                                                     904           821



     Total current liabilities                                                                                                                                                    145,633       123,489



     Long-term liabilities



     Deferred tax liability                                                                                                                                                       100,523       174,480



     Long-term debt, net, less current portion                                                                                                                                  1,185,411     2,134,920



     Related party long-term debt, net, less current portion                                                                                                                       35,211        64,758



     Operating lease liabilities, net of current portion                                                                                                                           13,133        14,278



     Finance lease liabilities, net of current portion                                                                                                                             11,290        12,194



     Deferred revenue - LT                                                                                                                                                          5,739         6,173



     Other long-term liabilities                                                                                                                                                      278         2,750



     Total liabilities                                                                                                                                                          1,497,218     2,533,042



     Commitments and contingencies (Note 20)



     Stockholders' equity



     Preferred stock $0.01 par value - 100,000,000 and zero shares authorized as of


                                                                        
              December 31, 2024 and December 31, 2023, respectively; zero shares issued or



     outstanding as of December 31, 2024 and December 31, 2023, respectively                                                                                                            -



     Common stock $0.01 par value - 2,500,000,000 and 227,000,000 shares



     authorized at December 31, 2024 and December 31, 2023, respectively;



     172,108,240 and 121,679,902 shares issued and outstanding at December 31,



     2024 and December 31, 2023, respectively                                                                                                                                       1,722         1,217



     Additional paid-in capital                                                                                                                                                 3,298,083     2,234,688



     Accumulated other comprehensive income (loss)                                                                                                                                    881        15,802



     Accumulated deficit                                                                                                                                                        (220,900)    (201,775)



     Total stockholders' equity                                                                                                                                                 3,079,786     2,049,932



     Total liabilities and stockholders' equity                                                                                                                                 4,577,004     4,582,974


                                                                      
              
                Waystar


                                                       
              
                Consolidated Statements of Cash Flows


                                                                   
              
                (in thousands)




                                                                                                                               Twelve months ended
                                                                                                                          December 31,


                                                                                                                            2024            2023



              Cash flows from operating activities



              Net loss                                                                                                 (19,125)       (51,334)



              Adjustments to reconcile net income/(loss) to net cash
    provided by operating activities



              Depreciation and amortization                                                                             186,631         176,467



              Stock-based compensation                                                                                   54,437           8,848



              Provision for bad debt expense                                                                              2,669           2,419



              Loss on extinguishment of debt                                                                             20,611             393



              Deferred income taxes                                                                                    (59,135)       (61,665)



              Amortization of debt discount and issuance costs                                                            3,946          10,471



              Other                                                                                                        (99)            485



              Changes in:



              Accounts receivable                                                                                      (21,816)       (16,714)



              Income tax refundable                                                                                       3,973         (2,459)



              Prepaid expenses and other current assets                                                                 (2,322)        (9,705)



              Deferred costs                                                                                           (16,497)       (14,189)



              Other long-term assets                                                                                      (472)        (1,664)



              Accounts payable and accrued expenses                                                                      18,228          11,920



              Deferred revenue                                                                                            (842)          (167)



              Operating lease right-of-use assets and lease liabilities                                                   (419)        (1,691)



              Other long-term liabilities                                                                                     -             45



              Net cash provided by operating activities                                                                 169,768          51,460



              Cash flows from investing activities



              Purchase of property and equipment and capitalization of internally                                      (27,268)       (21,517)
    developed software costs



              Acquisitions, net of cash and cash equivalents acquired                                                         -       (40,000)



              Net cash used in investing activities                                                                    (27,268)       (61,517)



              Cash flows from financing activities



              Change in aggregated funds liability                                                                       12,399           2,105



              Proceeds from equity offering, net of underwriting discounts                                            1,017,074



              Payments of third-party IPO issuance costs                                                                (3,407)



              Repurchase of shares                                                                                        (844)          (688)



              Proceeds from exercise of common stock options                                                              1,683             425



              Proceeds from issuances of debt, net of creditor fees                                                     576,060          20,000



              Payments on debt                                                                                      (1,584,080)       (37,983)



              Third-party fees paid in connection with issuance of new debt                                             (1,410)          (219)



              Finance lease liabilities paid                                                                              (821)          (791)



              Net cash provided by (used in) financing activities                                                        16,654        (17,151)



              Increase in cash and cash equivalents during the period                                                   159,154        (27,208)



              Cash and cash equivalents and restricted cash - beginning of period                                        45,428          72,636



              Cash and cash equivalents and restricted cash - end of period                                             204,582          45,428



              Supplemental disclosures of cash flow information



              Interest paid                                                                                             122,771         193,003



              Cash taxes paid (refunds received), net                                                                    51,100          51,449



              Non-cash investing and financing activities



              Fixed asset purchases in accounts payable                                                                     283           1,091



              Unpaid third-party IPO issuance costs                                                                          15



              Reconciliation of Balance Sheet Cash Accounts to Cash Flow Statement



              Balance sheet



              Cash and cash equivalents                                                                                 182,133          35,580



              Restricted cash                                                                                            22,449           9,848



              Total                                                                                                     204,582          45,428


                                               
        
                Waystar


                                  
              
          Reconciliation of Adjusted EBITDA


                                            
        
                (in thousands)


                                             
        
                (unaudited)




                                                                                            Three months ended              Twelve months ended
                                                                                      December 31,             December 31,


                                                                                      2024              2023         2024              2023



     Net income/(loss)                                                             19,079          (14,415)    (19,125)         (51,334)



     Interest expense                                                              20,086            52,860      146,270           205,917



     Income tax expense/(benefit)                                                  13,978             (757)     (3,420)         (12,500)



     Depreciation and amortization                                                 37,996            44,686      186,631           176,467



     Stock-based compensation expense                                               7,037             2,343       54,437             8,848



     Acquisition and integration costs                                                163               711          859             3,947



     Costs related to amended debt agreements                                       1,262               393       14,138               393



     IPO related costs                                                                 26               423        2,140             1,977



     Other (a)                                                                        526                         1,566



     Adjusted EBITDA                                                              100,153            86,244      383,496           333,715



     Revenue                                                                      244,102           206,695      943,549           791,010



     Net income/(loss) margin                                                       7.8 %           -7.0 %      -2.0 %           -6.5 %



     Adjusted EBITDA margin                                                        41.0 %           41.7 %      40.6 %           42.2 %



     (a) Adjustments relate to additional lease costs due to the relocation of
          our Louisville office


                                               
              
                Waystar


                            
              
                Reconciliation of Non-GAAP Operating Expenses


                                           
              
                (in thousands)


                                             
              
                (unaudited)




                                                                                                        Three months
                                                                                                           ended            Twelve months ended
                                                                                                 December 31,          December 31,



                                                                                                 2024             2023       2024              2023



     Cost of revenue (exclusive of depreciation and



     amortization expenses)                                                                   79,542           67,190    315,730           249,767



     Less:



     Stock-based compensation expense                                                          (242)           (100)   (2,403)            (645)



     Acquisition and integration costs                                                             -              45       (31)             (13)



     IPO related costs                                                                             -                       (9)



     Other (a)                                                                                  (33)                      (33)



     Cost of revenue (exclusive of depreciation and


     amortization expenses), adjusted                                                         79,267           67,135    313,254           249,109



     Sales and marketing                                                                      38,990           30,946    156,935           124,437



     Less:



     Stock-based compensation expense                                                        (1,482)           (479)  (12,440)          (1,865)



     Acquisition and integration costs                                                             -            (17)                       (66)



     IPO related costs                                                                           (7)            (15)     (148)             (15)



     Sales and marketing, adjusted                                                            37,501           30,435    144,347           122,491



     General and administrative                                                               22,959           16,400    111,753            62,924



     Less:



     Stock-based compensation expense                                                        (4,245)         (1,405)  (31,288)          (5,035)



     Acquisition and integration costs                                                         (157)           (597)     (429)          (3,304)



     Costs related to amended debt agreements                                                (1,262)           (393)  (14,138)            (393)



     IPO related costs                                                                          (19)           (393)   (1,975)          (1,947)



     Other (a)                                                                                 (493)                   (1,533)



     General and administrative, adjusted                                                     16,783           13,612     62,390            52,245



     Research and development                                                                 11,472            9,785     48,775            35,332



     Less:



     Stock-based compensation expense                                                        (1,068)           (359)   (8,306)          (1,303)



     Acquisition and integration costs                                                           (6)           (142)     (399)            (564)



     IPO related costs                                                                             -            (15)       (8)             (15)



     Research and development, adjusted                                                       10,398            9,269     40,062            33,450



     Depreciation and amortization                                                            37,996           44,686    186,631           176,467



     Less:



     Other (a)                                                                               (2,103)                  (17,879)



     Intangible amortization (b)                                                            (30,647)         (39,004) (147,887)        (159,406)



     Depreciation and amortization, adjusted                                                   5,246            5,682     20,865            17,061



     Income tax expense/(benefit)                                                             13,978            (757)   (3,420)         (12,500)



     Plus:



     Tax effect of adjustments                                                                 8,770            9,004     50,170            36,660



     Income tax expense/(benefit), adjusted                                                   22,748            8,247     46,750            24,160



     (a) Adjustments relate to additional lease costs and accelerated depreciation due to the
          relocation of our Louisville office


     (b) Intangible amortization relates to acquisitions and therefore included in reconciliation.


                                                                       
              
                Waystar


                                                        
              
                Reconciliation of Non-GAAP Net Income


                                                 
              
                (in thousands, except share and per share amounts)


                                                                     
              
                (unaudited)




                                                                                                                                     Three months ended           Twelve months ended
                                                                                                                                 December 31,             December 31,



                                                                                                                                 2024               2023        2024               2023



              Net income/(loss)                                                                                               19,079           (14,415)   (19,125)          (51,334)



              Stock based compensation                                                                                         7,037              2,343      54,437              8,848



              Acquisition and integration costs                                                                                  163                711         859              3,947



              Costs related to amended debt agreements                                                                         1,262                393      14,138                393



              IPO related costs                                                                                                   26                423       2,140              1,977



              Other (a)                                                                                                        2,629                        19,445



              Intangible amortization (b)                                                                                     30,647             39,004     147,887            159,406



              Tax effect of adjustments                                                                                      (8,770)           (9,004)   (50,170)          (36,660)



              Non-GAAP net income/(loss)                                                                                      52,073             19,455     169,611             86,577





              Non-GAAP net income/(loss) per common share, basic                                                                0.30               0.16        1.13               0.71



              Non-GAAP net income/(loss) per common share, diluted                                                              0.29               0.15        1.09               0.68



              Weighted average shares used in computing basic Non-                                                       172,526,776        121,679,113 149,915,839        121,675,430
    GAAP net income/(loss) per share



              Weighted average shares used in computing diluted
    Non-GAAP net income/(loss) per share
                                                                                                                          179,112,559        127,303,675 155,677,094        126,888,989



     (a) Adjustments relate to additional lease costs and accelerated depreciation due to the
          relocation of our Louisville office


     (b) Intangible amortization relates to acquisitions and therefore included in reconciliation.


                                                                
          
                Waystar


                                               
              
           Reconciliation of Unlevered Free Cash Flow


                                                            
          
                (in thousands)


                                                              
          
                (unaudited)




                                                                                                                        Three months
                                                                                                                         ended            Twelve months ended
                                                                                                                December 31,         December 31,


                                                                                                                2024            2023       2024              2023





              Net cash provided by operating activities                                                      64,770          11,456    169,768            51,460



              Interest paid                                                                                  21,582          49,318    122,771           193,003



              Purchase of property and equipment and                                                        (6,224)         (5,791)   (27,268)         (21,517)
    capitalization of internally developed software costs



              Unlevered free cash flow                                                                       80,128          54,983    265,271           222,946


                                                             
              
                Waystar


                                                   
              
                Reconciliation of Net Debt


                                                         
              
                (in thousands)


                                                           
              
                (unaudited)




                                                                                                      December 31, 2024   December 31,
                                                                                                                               2023



     First lien term loan facility outstanding debt, current                                                    11,668          17,983



     First lien term loan facility outstanding debt, net of current portion                                  1,151,878       1,712,833



     Second lien term loan facility outstanding debt                                                                 -        448,000



     Receivables facility outstanding debt                                                                      80,000          70,000



     Cash and cash equivalents                                                                               (182,133)       (35,580)



     Net debt                                                                                                1,061,413       2,213,236



     Trailing Twelve Months Adjusted EBITDA                                                                    383,496         333,715



     Adjusted Gross leverage ratio                                                                     
              3.2x 
             6.7x



     Adjusted Net leverage ratio                                                                       
              2.8x 
             6.6x


                                                           
              
                Waystar


                                            
       
           Reconciliation of Trailing Twelve Months (TTM) Adjusted EBITDA


                                                        
              
                (in thousands)


                                                         
              
                (unaudited)




                                                                                                           
              Three Months Ended                         TTM


                                                                                      December 31,                  September
                                                                                                                        30,              June 30,  March 31,         December 31,


                                
              2024                                               2024                        2024                2024          2024



     Net income/(loss)                                                                     19,079                       5,413            (27,685)   (15,932)             (19,125)



     Interest expense                                                                      20,086                      18,459              50,541      57,184               146,270



     Income tax expense/(benefit)                                                          13,978                       3,274            (14,611)    (6,061)              (3,420)



     Depreciation and amortization                                                         37,996                      60,185              44,276      44,174               186,631



     Stock-based compensation expense                                                       7,037                       7,903              36,969       2,528                54,437



     Acquisition and integration costs                                                        163                         188                 206         302                   859



     Costs related to amended debt agreements                                               1,262                         106               2,368      10,402                14,138



     IPO related costs                                                                         26                         109               1,841         164                 2,140



     Other (a)                                                                                526                       1,040                                               1,566



     
                
                  Adjusted
          EBITDA                                    100,153                      96,677              93,905      92,761               383,496



     (a) Adjustments relate to additional lease costs due to the relocation of
          our Louisville office

Media Contact
Kristin Lee
kristin.lee@waystar.com

Investor Contact
Sandy Draper
investors@waystar.com
502-238-9511

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SOURCE Waystar