Syra Health Announces First Quarter Revenue of $1.9 Million, Up 6% YoY

Revenue increase led by Population Health's 261% YoY Expansion

Gross Margin Improves Substantially to 31.7%, up 14.6 Percentage Points YoY

Continued Efficiency Gains Cut Q1 2025 Net Losses by Over Two Thirds Compared to Q1 2024

A conference call will be held today, Thursday, May 8, at 9:00 am ET

CARMEL, Ind., May 8, 2025 /PRNewswire/ -- Syra Health Corp. (OTCQB: SYRA) ("Syra Health" or the "Company"), a healthcare technology company dedicated to powering better health through innovative technology products and services, announced today its financial results for the first quarter ended March 31, 2025.

Q1 2025 Financial Highlights

    --  Total revenue of $1.9 million, up 6% compared to $1.8 million in Q1
        2024.
        --  Revenues, excluding Healthcare Workforce, grew 261% YoY and expanded
            to 65% of total revenues, compared to 19% of total revenue in Q1
            2024.
        --  Population Health reached $1.2 million in revenues, more than
            tripling from $333,000 in Q1 2024, driven by new contracts and
            extensions, as well as increased contributions from milestone-based
            revenues.
    --  Gross margins expand YoY by 14.6 percentage points to 31.7% in 1Q 2025.
    --  Operating Expense decreased 39% YoY, continuing to improve the
        profitability trajectory.
    --  Net Loss reduction to ($472,000) from ($1.4) million in Q1 2024.
    --  Cash of $2.5 million and no long-term debt as of March 31, 2025.

2025 Financial Outlook

    --  Ongoing federal government-level budgetary revisions are impacting our
        key customers across state, local, and county government agencies. Given
        the current variability of the healthcare market, the Company believes
        it is prudent to withdraw its 2025 guidance at this time. An updated
        outlook will be provided once these changes are more quantifiable.
    --  The Company is continuing to prioritize the higher margin Population
        Health and Behavioral and Mental Health business units and is also
        expanding into the private healthcare sector, alongside its public
        sector work.

Recent Operational Highlights

    --  Secured a $2.5 million Population Health contract with a major insurance
        provider to enhance member health plans using advanced data analytics.
        The contract, which is set to renew for two additional years at the same
        value, will be supported by a dedicated team of Syra Health
        professionals.
    --  Secured a one-year, $1.5 million contract extension with Indiana FSSA
        NeuroDiagnostic Institute, a portion of which has already been received,
        with the remainder to be recognized over time based on service needs.
    --  Awarded a $660,000 Population Health contract extension with a national
        healthcare organization to improve quality, enhance outcomes, and reduce
        costs through expert data analysis and member outreach supporting its
        Healthcare Effectiveness Data and Information Set (HEDISĀ®).
    --  Launched specialized content within Syrenity aimed at supporting
        individuals living with Post-Traumatic Stress Disorder (PTSD), including
        evidence-based coping strategies, guided exercises, and expert-led
        modules.

Management Commentary

Dr. Deepika Vuppalanchi, CEO of Syra Health, said, "We are pleased that we began 2025 with strong momentum, delivering solid revenue growth and significant gross margin expansion, driven by our strategic focus on higher-margin business units. The success of our Population Health business unit underscores the effectiveness of our refined go-to-market strategy and our commitment to addressing critical gaps in healthcare delivery. As we navigate a dynamic healthcare landscape, we remain focused on operational efficiency, innovative digital health solutions, and long-term value creation for our key stakeholders."

Q1 2025 Financial Results

Revenue for the first quarter of 2025 was $1.9 million, an increase of 6% compared to $1.8 million in the first quarter of 2024. Strong growth was driven by the high-margin Population Health segment, which expanded 261% year-over-year. Within Healthcare Workforce, our long-term contract with the Indiana FSSA NeuroDiagnostic Institute expired, partially offset by the aforementioned contract extension with the same customer.

Gross profit margin was 31.7% in the first quarter of 2025, a 14.6 percentage point expansion compared to 17.1% in the prior year period. This improvement was related to the phase out of certain lower-margin Healthcare Workforce contracts and a shift towards higher-margin Population Health contracts. The year-over-year margin expansion also reflects a $120,000 reclassification of expenses from cost of services to selling, general, and administrative expenses in the year-ago period.

Total operating expenses for the first quarter of 2025 were $1.1 million compared to $1.7 million in the first quarter of 2024, a decline of 39% compared to the year-ago period. The reduction was driven by operational efficiency gains and disciplined cost management, which was partially offset by the aforementioned reclassification of expenses.

Adjusted EBITDA for the first quarter of 2025 was ($462,000), a significant improvement compared to ($1.4) million in the prior year.

Net loss for the first quarter of 2025 was ($472,000) compared to ($1.4) million in the first quarter of 2024. This improvement of over 3x versus the year-ago period was driven by our operational restructuring efforts, a continuation of trends that began last year. Earnings per share for the first quarter of 2025 were ($0.04), compared to ($0.22) in the year-ago period.

Conference Call

Management will hold a conference call to discuss the full-year financial results at 9:00 am ET on May 8, 2025.

Interested parties can listen to the live webcast and access the replay after the call through the same link available in the Investor Relations section of the Company's website at https://ir.syrahealth.com/presentations/Q1-2025-earnings-call.


                                                                                      
            
            SYRA HEALTH CORP.
                                                                                            
            BALANCE SHEETS
                                                                                             
            (UNAUDITED)


                                                                                                                               March 31,               December 31,


                                                                                                                                      2025            2024


                                                                 
            ASSETS                                                 (Unaudited)





            Current assets:



            Cash and cash equivalents                                                                                    $
           2,490,585 $
          2,395,405



            Accounts receivable, net                                                                                                945,856           680,827





            Other current assets                                                                                                    210,788           276,563



            Total current assets                                                                                                  3,647,229         3,352,795





            Property and equipment, net                                                                                              20,550            27,347



            Right-of-use asset                                                                                                       54,771           299,190





            Total assets                                                                                                 $
           3,722,550 $
          3,679,332




                                             
            LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)





            Current liabilities:



            Accounts payable                                                                                               $
           325,027   $
          101,690



            Accrued expenses                                                                                                        211,867           230,383



            Deferred revenue                                                                                                        599,213            16,611



            Current portion of operating lease liability, related party                                                              54,771           111,978



            Notes payable                                                                                                            75,036           152,887



            Total current liabilities                                                                                             1,265,914           613,549





            Non-current portion of operating lease liability, related party                                                                          187,212





            Total liabilities                                                                                                     1,265,914           800,761





            Commitments and contingencies





            Stockholders' equity (deficit):



            Preferred stock, $0.001 par value, 10,000,000 shares authorized,
    no shares designated, issued and outstanding



            Class A common stock, $0.001 par value, 100,000,000 shares                                                               11,339             8,979
    authorized, 11,339,169 and 8,979,204 shares issued and
    outstanding at March 31, 2025 and December 31, 2024,
    respectively



            Convertible class B common stock, $0.001 par value, 5,000,000                                                               600               833
    shares authorized, 6000,000 and 833,334 shares issued and
    outstanding at March 31, 2025 and December 31, 2024,
    respectively





            Additional paid-in capital                                                                                           11,741,155        11,692,952



            Accumulated deficit                                                                                                 (9,296,458)      (8,824,193)



            Total stockholders' equity (deficit)                                                                                  2,456,636         2,878,571





            Total liabilities and stockholders' equity (deficit)                                                         $
           3,722,550 $
          3,679,332


                                                                     
         
              SYRA HEALTH CORP.
                                                                       
         STATEMENTS OF OPERATIONS
                                                                         
              (UNAUDITED)




                                                                                                                         For the Three Months Ended


                                                                                                                                 March 31,


                                                                                                                  2025                                  2024





     Net revenues                                                                                      $
         1,857,774                   $
              1,752,340



     Cost of services                                                                                         1,268,618                               1,452,561



     Gross profit                                                                                               589,156                                 299,779





     Operating expenses:



     Salaries and benefits                                                                                      507,207                                 736,303



     Professional services                                                                                      224,026                                 194,580



     Research and development expenses                                                                           37,173                                 277,548



     Selling, general and administrative expenses                                                               287,287                                 522,757



     Depreciation                                                                                                 6,797                                  12,545



     Total operating expenses                                                                                 1,062,490                               1,743,733





     Operating loss                                                                                           (473,334)                            (1,443,954)





     Other income (expense):



     Interest income                                                                                              4,298                                     981



     Interest expense                                                                                           (3,229)                                (4,077)



     Total other income (expense)                                                                                 1,069                                 (3,096)





     Net loss                                                                                          $
         (472,265)                $
              (1,447,050)





     Weighted average common shares outstanding - basic and diluted                                          11,587,058                               6,495,213



     Net loss per common share - basic and diluted                                                        $
         (0.04)                     $
              (0.22)




                                                                                  
         
              SYRA HEALTH CORP.
                                                                                    
         STATEMENTS OF CASH FLOWS
                                                                                      
             (UNAUDITED)




                                                                                                                                         For the Three Months Ended


                                                                                                                                                 March 31,


                                                                                                                                  2025                                         2024



     CASH FLOWS FROM OPERATING ACTIVITIES



     Net loss                                                                                                           $
        (472,265)                          $
           (1,447,050)



     Adjustments to reconcile net loss to net cash used in operating activities:



     Depreciation                                                                                                                 6,797                                         12,545



     Common stock issued for services                                                                                             2,586                                         18,875



     Non-cash lease expense                                                                                                                                                    31,373



     Stock-based compensation, stock options                                                                                     32,944                                         14,140



     Changes in operating assets and liabilities:



     Accounts receivable                                                                                                      (265,029)                                       314,951



     Accounts receivable, related party                                                                                                                                      (31,510)



     Other current assets                                                                                                        65,775                                          7,900



     Right-of-use asset                                                                                                         244,419



     Accounts payable                                                                                                           223,337                                        182,576



     Deferred revenue                                                                                                           582,602                                          6,108



     Accrued expenses                                                                                                          (18,516)                                       120,720



     Operating lease liability                                                                                                (244,419)                                      (31,373)



     Net cash provided by/(used in) operating activities                                                                        158,231                                      (800,745)





     CASH FLOWS FROM INVESTING ACTIVITIES



     Purchase of property and equipment                                                                                                                                       (5,619)



     Net cash used in investing activities                                                                                                                                    (5,619)





     CASH FLOWS FROM FINANCING ACTIVITIES



     Proceeds received on exercise of warrants                                                                                   14,800                                        850,129



     Repayments on notes payable                                                                                               (77,851)                                      (85,883)



     Net cash provided by/(used in) financing activities                                                                       (63,051)                                       764,246





     NET CHANGE IN CASH AND CASH EQUIVALENTS                                                                                     95,180                                       (42,118)



     CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD                                                                         2,395,405                                      3,280,075



     CASH AND CASH EQUIVALENTS AT END OF PERIOD                                                                         $
        2,490,585                             $
           3,237,957





     SUPPLEMENTAL INFORMATION:



     Interest paid                                                                                                         $
         3,229                                $
            4,077



     Income taxes paid                                                                                              
     $                           
              $



     NON-CASH INVESTING AND FINANCING ACTIVITIES:



     Conversion of Class B common stock to Class A common stock                                                            $
         2,333            
              $

Non-GAAP Financial Measures

In addition to financial results reported in accordance with accounting principles generally accepted in the United States of America ("GAAP"), we have provided the following non-GAAP financial measure in this release and the accompanying tables: adjusted EBITDA. We use this non-GAAP financial measures internally to facilitate period-to-period comparisons and analysis of our operating performance and liquidity, and believe it is useful to investors as a supplement to GAAP measures in analyzing, trending, and benchmarking the performance and value of our business. However, this measure is not intended to be a substitute for those reported in accordance with GAAP. These measures may be different from non-GAAP financial measures used by other companies, even when similar terms are used to identify such measures. For reconciliations of historical non-GAAP financial measures to the most comparable financial measures under GAAP, see the table below.


                   
              
                SYRA HEALTH CORP.
          
                RECONCILIATION OF ADJUSTED EBITDA TO NET LOSS
                           
                (UNAUDITED)




                                                                                    Quarter Ended


                                                                     March 31, 2024               March 31, 2025



     Net Income                                                       ($1,447,050)                   ($472,265)



     Interest expense                                                        4,077                         3,229



     Depreciation expense                                                   12,545                         6,797



     Taxes



     Adjusted EBITDA                                                  ($1,430,428)                   ($462,239)

About Syra Health

Syra Health is a healthcare technology company that powers better health in critical areas such as mental health, population health, and the healthcare workforce. The company's leading-edge technology products and innovative services focus on prevention, access, and affordability. With a commitment to improving health, Syra Health is advancing healthcare solutions nationwide and around the world. For more information, please visit www.syrahealth.com.

Forward-Looking Statements

Statements in this press release about future expectations, plans, and prospects, as well as any other statements regarding matters that are not historical facts, may constitute "forward-looking statements." These statements include but are not limited to, statements relating to the expected use of proceeds, the Company's operations and business strategy, and the Company's expected financial results. The words "anticipate," "believe," "continue," "could," "estimate," "expect," "intend," "may," "plan," "potential," "predict," "project," "should," "target," "will," "would" and similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain these identifying words. The forward-looking statements contained in this press release are based on management's current expectations and are subject to substantial risks, uncertainty, and changes in circumstances. Investors should read the risk factors set forth in our Form 10-K for the year ended December 31, 2024, and other periodic reports filed with the Securities and Exchange Commission. Any forward-looking statements contained in this press release speak only as of the date hereof, and, except as required by federal securities laws, the Company specifically disclaims any obligation to update any forward-looking statements, whether as a result of new information, future events, or otherwise.

Contacts

For Media Inquiries:
Christine Drury
Director of Corporate Communications
Syra Health
463-345-5180
christined@syrahealth.com

For Investor Inquiries:
Corbin Woodhull
Managing Director, Global Advisory
Hayden IR
602-476-1821
corbin@haydenir.com

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SOURCE Syra Health