LifeStance Health Group, Inc. Q2 FY2024 earnings call

• Continued executing the plan, achieving 7th consecutive quarter of meeting/exceeding expectations. - Revenue grew 20% to $312 million and adjusted EBITDA was $29 million. - Value proposition of in-person and virtual care resonated, with approaching 7,000 employee clinicians, 14% year-over-year growth, and 118 net clinician adds in the quarter. - Net Promoter Score was 86 and average Google reviews across centers were 4.6 out of 5 stars. - Operational initiatives: finalizing digital matching tool for booking new patients by phone, rolling out digital patient check-in tool (first 6 states with 5 more in progress), and redesign of operating model launched July 1 to standardize across 33 states, enhance front office support, and increase clinical leadership.

No detailed product segment breakdown provided. Overall, second quarter saw revenue growth of 20% to $312 million and adjusted EBITDA of $29 million. Visit volumes were 2 million, up 15% year-over-year, with total revenue per visit increasing 4% to $159 primarily due to payer rate increases. Center margin was $98 million, up 34% year-over-year.

• Raised full-year revenue range to $1.200 billion to $1.242 billion, center margin range to $363 million to $383 million, and adjusted EBITDA range to $90 million to $100 million. - Q3 expected revenue $290 million to $310 million, center margin $83 million to $95 million, and adjusted EBITDA $15 million to $21 million. - Stock-based compensation expected towards the lower end of $80 million to $95 million. - Expected to open fewer than 10 de novos by year-end.

• Impact from Change Healthcare cyberattack on collections, though considered a timing issue to be resolved by the end of the year.

Q: Can you provide an update on payer rates and clinician growth?

A: Payer rates going well except one exception, clinician growth pipeline is robust with value proposition resonating.

Q: Any change in competitive standpoint for clinicians?

A: Movement back to in-person visits, retention stabilized but not where desired.

Q: Why is EBITDA margin contracting in Q3 and impact of operating model?

A: Revenue step-down due to lower visits and TRPV calendar, operating model rollout contributing to back half OpEx.

Q: Thoughts on center footprint and 2025 margins?

A: Stable footprint, continuing to grow into it, 2025 margins on track for double-digit with operating leverage, specialty services, and rate increases.

Q: Details on credentialing platform and go-to-market?

A: Migrating to new platform, relying on referrals from primary care and specialists for patient acquisition