OptimizeRx Corporation Common Stock 2026 Q2 Earnings Call

Mr. Silvestro. Thank you, operator, and good afternoon, everyone.

Thank you for joining us for our second quarter 2026 earnings call. We're pleased to report second quarter revenue of $20.5 million and adjusted EBITDA of $4.9 million, both of which exceeded consensus expectations. Our results reflect continued margin expansion, disciplined operational execution, and the resilience of our operating model despite a healthcare marketing environment that remains dynamic. While revenue declined year-over-year and contracted revenue remains below prior year levels, these declines remain limited to a small number of large customers, including the one customer we discussed last quarter that again did not generate revenue this quarter. As well as customers that have made heavier use of lower margin managed service offerings in prior year periods, services from which we have been transitioning away since the acquisition of Medicx Health in 2023.

Outside the business with these limited customers and across the remainder of the business, we are encouraged by improving engagement and growth. At the same time, our continued investment in platform capabilities, including recent product launches and expanded programmatic initiatives, is strengthening customer engagement and our competitive position as we move into the 2027 planning cycle. Although the timing and mix of second half revenue remains subject to some variability, our first half performance, encouraging commercial momentum, and current outlook support our decision to reiterate full year 2026 revenue guidance of $95 million-$100 million and adjusted EBITDA guidance of $21 million-$25 million. Ed will provide additional details during his prepared remarks. Over the past several quarters, we've remained focused on executing against the initiatives within our control, improving profitability, strengthening our balance sheet, expanding our technology platform, and creating new avenues for long-term growth.

I believe our second quarter results demonstrate the progress we've made across each of these priorities. While portions of the pharmaceutical marketing landscape continue to experience some budget timing variability and cautious spending behavior, we're encouraged by the continued stabilization we're seeing across many of our largest customers. More importantly, the long-term secular trends driving our business remain firmly intact. Life science organizations continue shifting toward more measurable, data-driven engagement that delivers value at the point of clinical decision making. Healthcare marketers increasingly expect AI-enabled planning, authenticated healthcare audiences, measurable outcomes, and seamless programmatic execution. These are precisely the areas in which OptimizeRx has invested for years and where we believe we maintain a meaningful competitive advantage. Our existing customers continue expanding their use of our platform across additional brands, therapeutic areas, and commercial use cases.

During the quarter, we saw continued adoption of our AI-enabled dynamic audience activation platform or DAP, which increased over 30% year-over-year, while also expanding our point of prescribe capabilities across both pharmaceutical and med tech customers. These solutions are powered by OptimizeRx's proprietary foundational data asset, which continues to grow as more engagement transpires across our ecosystem. We're also continuing to make progress expanding our footprint among mid-sized and emerging life science companies, which we believe represent one of the largest untapped opportunities within our commercial business. As these organizations increasingly seek enterprise-grade technology solutions without enterprise scale or infrastructure investments, we believe our platform is uniquely positioned to meet the demand by bridging the technology gap for them and leveling the playing field for them to be able to compete with top-tier companies.

Just as important, we continue making progress transitioning more of our business toward recurring subscription revenue, particularly within our AI-enabled software offerings, which grew 25% year-over-year. Over time, we believe this transition will further improve revenue visibility while strengthening the durability and predictability of our financial model. Taken together, these trends reinforce our confidence that the underlying fundamentals of our business remain very strong. Meanwhile, during the second quarter, we announced three significant product innovations that further strengthen our competitive position while expanding our long-term opportunities at OptimizeRx. First, we announced that DeepIntent become the first healthcare demand-side platform to integrate directly with our authenticated EHR network. This represents an important milestone in our strategy of making point-of-care media easier to access through the programmatic platforms healthcare marketers already rely on.

As media buying continues shifting toward programmatic workflows, we're positioning OptimizeRx as the trusted infrastructure connecting premium point of care inventory with the industry's leading buying platforms. The implementation is now live. Second, we introduced our patent pending Natural Language Audience Builder, or NLAB. This AI-powered capability enables pharmaceutical marketers and agencies to build highly customized healthcare provider audiences using simple natural language prompts directly within DSPs and media planning platforms. By combining our proprietary healthcare intelligence with intuitive AI-driven workflows, we're making it significantly easier for marketers to build targeted audiences while further embedding OptimizeRx technology into the planning tools of our customers that they're already using today. Finally, we launched CopayCue, our next generation copay activation solution powered by real-time prescribing intent.

Medication affordability remains one of the largest barriers to patient adherence, and CopayCue delivers savings information directly within the prescribing workflow at the exact moment physicians are making treatment decisions. By combining real-time intent signals with our industry-leading point of care and point of prescribe capabilities, we're helping life science organizations improve patient access while delivering stronger commercial outcomes for their brands. Individually, each of these launches represents an important advancement for our platform. Collectively, they demonstrate something even more significant, that we have entered a new phase of innovation as a company. We are evolving beyond being solely a point-of-care marketing company into being the operating system for pharmaceutical marketers. Our technology infrastructure is connecting pharmaceutical marketers, media agencies, demand side platforms, healthcare providers, and patients at scale through authenticated clinical workflows.

As AI becomes increasingly integrated into commercial planning and as healthcare advertising continues migrating toward privacy safe programmatic execution, we believe our combination of proprietary healthcare data, authenticated clinical inventory, and workflow integration creates a highly differentiated platform with significant long-term growth potential. This strategic evolution not only expands our addressable market, but also creates additional recurring revenue opportunities that we believe will become increasingly meaningful over time. Before turning the call over to Ed, I'd like to share an important leadership announcement regarding our finance organization. Over nearly five years as Chief Financial Officer, including previously as our Chief Operations Officer and most recently as our Chief Strategy Officer, Edward Stelmakh and the board of directors have mutually agreed on a planned leadership transition effective December 31, 2026, that reflects both the depth of talent within our organization and our commitment to prudent financial stewardship.

Over the past five years, Ed has played an instrumental role in transforming our financial foundation and positioning OptimizeRx for long-term success. Under his leadership, we've significantly expanded our gross margins and operating margins, strengthened our operating discipline, successfully refinanced our debt to materially improve our cost of capital, completed the acquisition and integration of Medicx Health, executed the divestiture of non-core assets to sharpen our strategic focus, and built a deep, highly capable finance and strategy organization that positions the company well for the future. Just as importantly, Ed has helped establish the financial discipline and operational rigor that support our long-term strategy and our commitment to sustainable shareholder value creation. As part of our long-term succession planning process, we're pleased to announce that Andy D'Silva will succeed Ed as our Chief Financial Officer effective January 1, 2027.

Andy has most recently served as our Chief Business Officer and has worked closely with Ed and the board of directors and our executive leadership team on our financial strategy, capital allocation, investor relations, corporate development, and long-range planning. He's been deeply involved in many of the strategic initiatives that have helped transform the business over the past several years, making him well prepared to lead our finance organization as CFO. We're also pleased to announce that Heather Favazza will be promoted to Chief Accounting Officer effective January 1, 2027. Heather has been an outstanding leader with our financial organization and played an instrumental role as our corporate controller for the last eight years, strengthening our accounting operations, financial reporting, internal controls, and overall finance infrastructure.

Her promotion reflects both the strength of our accounting organization and the deep bench of leadership that we've built over the past several years. To ensure a seamless transition, Edward will remain our Chief Financial and Strategy Officer through the end of 2026. Edward has also agreed to remain in the role of strategic advisor in 2027 to ensure ample time for thoughtful and seamless transfer of responsibilities while allowing Andy and Heather to continue working closely with him as they assume their expanded leadership roles. Transitions like these are strongest when they're the result of thoughtful planning rather than necessity, and that's exactly what this represents. We have tremendous confidence in Andy and Heather, and we're equally grateful that Edward will continue supporting the company throughout the transition.