Health Catalyst, Inc. (HCAT) Earnings Call Transcript & Summary

Good afternoon, everyone, and welcome to the JPMorgan Healthcare Conference. My name is Annie Samuel and I'm the health care technology and distribution analyst here at JPMorgan. We're thrilled to have Health Catalyst here with us today. With us are CEO, Dan Burton; and CFO, Bryan Hunt. Following our presentation, we'll take Q&A. So if you have a question, please use the ask a question button in the portal, and we'll be sure to take any questions from the audience. And with that, let me turn it over to Dan.

Thank you so much, Annie. Thank you to all of you who have taken the time to spend a few minutes here with us at Health Catalyst. We're excited to share a number of updates with you as it relates to our 2021 experience and our outlook moving forward. I'll refer to a number of pages in our prepared remarks or prepared presentation so that you can follow along. And we'll begin on Page 3 of our prepared presentation with an overview of the company. So Health Catalyst is a leading provider of data and analytics technology and services to health care organizations. There's 3 components of our primary solution that we offer to these health care organizations, starting with the data platform, which makes it easy and possible for our health system clients to integrate data in a flexible, open and scalable platform into a single source of truth that they can then use to manage enterprise-wide and understand their performance across clinical, financial and operational areas, which leads us to the second component of our solution. Once that data has been organized into the data platform, we can run analytics applications across clinical, financial and operational areas to understand what's going well, and, more importantly, where there are opportunities for improvement, both clinically, financially and operationally. When we find specific opportunities for improvement, then the third component of our solution is something that we offer up to our clients where it's helpful, which is the right services expertise in those domain areas where we want to work to measurably improve. Next, on Page 4. From a mission perspective and a strategy perspective, Health Catalyst's mission has been focused from the beginning on being a catalyst for massive, measurable, data-informed health care improvement. And we use a strategic framework of our flywheel to represent how we accomplish that mission each year with each client to identify our company strategy. So we begin in a relationship with the client at the top of the flywheel, where we recognize that they are really taking a leap of faith that the combination of the 3 components of our solution --the data platform, the analytics applications and the right services expertise -- will combine with their efforts to produce actual measurable improvement. When that measurable improvement occurs in the first year of a client relationship, the trust between us and our clients builds and strengthens. And our clients then will choose, in subsequent years, to work on more and more specific improvement projects across more domain areas, across clinical, financial and operational areas. And the flywheel spins a little faster and faster over the years as we deepen our relationship together. Now at the center of our flywheel, at the center of our company strategy, is team member engagement because our team members are the ones that drive innovation and excellence in each of the 3 components of our solution: our data platform, analytics applications and services expertise. And so maintaining an ability to attract and then retain world-class team members, engaged team members is a fundamental part of what we focus on. It's my #1 priority as the CEO and we measure that regularly to ensure that we're operating at a world-class level from an engagement perspective. On Slide 5, we wanted to highlight 5 specific investment category highlights at a summary level. Reasons why? If we were a public market investor, we would be excited about Health Catalyst as a differentiated stock. First, we've been recognized as an industry leader in health care data and analytics. We're solving a really large problem, the $1 trillion a year U.S. waste problem or $0.30 out of every $1 being wasteful and not leading to better outcomes. To understand what is wasteful, you need to understand what's not working. And to do that, you've got to have a data and analytics infrastructure. And that's provided us with a meaningful TAM, that's U.S.-based today at $8 billion and one that is growing meaningfully. Second, we have a comprehensive solution. We're not limited to just one component of the solution. We offer all 3 components of the data platform, analytics applications and services expertise, and we have real depth in each of these 3 components of our solution. At the platform layer, we have deep experience, working with all the most common data sources, whether that's EMR, supply chain, finance, costing, labs; you name it, we've worked with it. We've automated the process of bringing that data into that single source of truth. We're also accustomed, at the platform layer, to dealing with large volumes and stores of data, often 10 to 100 terabytes or more of data per customer. At the app layer, we've developed a significant set of application suites. We now have over a dozen application suites plus a large library of lighter-touch analytics accelerators or visualizations that can help to meaningfully improve clinically, financially, operationally. And then finally, as it relates to the third component of our solution, we have several hundred experts, domain experts in clinical, financial, operational areas that our clients can tap into very flexibly based on what they're prioritizing, where they need to see the most improvement in any given year. All of those 3 components of the solution leads to the result, which is measurable clinical, financial and operational improvements. Our clients have realized over 1,400 improvements working with Health Catalyst over the years. And we have found that over time, our clients are realizing more and more improvements, including as they spend more time in a relationship with Health Catalyst that subsequent years from that first year, they realize more and more improvements per year, which increases the value and the ROI that they're realizing from the relationship. All of this is driven, as I mentioned before, by world-class team member engagement. We're pleased to announce that our most recent third-party measurement of engagement among our team members from the Gallup organization, which closed just a few weeks ago, placed the company in the 96th percentile as it relates to team member engagement. This is especially significant now in a tight labor market, where individuals, talented individuals have so many options, so many places that they can choose to work. We benefit greatly from having been recognized 74 times now as a best place to work, and having been recognized as a place that cares about team members and puts their engagement at the center of our strategy. All of these components lead to an attractive operating model, where we have a very predictable business with over 90% of our revenue recurring in nature. We have a strong long-term growth profile of 20-plus percent. And we have a loyal customer base that chooses to expand with us. Here on -- next on Slide 6 -- Page 6. We know that we are all trying to understand the specific impacts the ongoing COVID-19 pandemic is having in each of our business areas. Health Catalyst is certainly in a position where there has been an impact, both positive and challenging as it relates to our experience now almost 2 years into the COVID-19 pandemic. From a technology perspective, on the positive side, we've seen usage of our data platform break records in terms of the increased utilization that's helped our clients work their way through various components of the COVID-19 pandemic. We've seen robust and continued full-year tech dollar-based retention through the pandemic. And as it relates to our professional services impact, we do benefit from the fact that we've remained very highly engaged in support of our clients throughout the pandemic. We did see lower professional services dollar-based retention in 2020 certainly as a result of some of the near-term financial pressure that these health systems face. But we've seen 2021 performance in professional services rebound and strengthen through the first 3 quarters of the year. And in our next earnings call, we'll provide an update as it relates to Q4 and the remainder of the year. From a medium- to long-term perspective, we see an overall tailwind in a positive as it relates to the broader recognition that health systems need a commercial-grade data and analytics solution. A patchwork solution is not enough. And Health Catalyst can offer that commercial-grade solution, not only at the data platform layer, but also at the applications layer and also with regards to the right services expertise. Next, let's go to Slide 11, where we can take a little deeper dive into the 3 components of our solution that we offer. To reorient you, we started at the bottom of this slide with the data platform, which on its own provides a multibillion-dollar meaningful TAM in providing that enterprise-wide data warehouse platform that is scalable, flexible and open to then be able to provide analytics across clinical, financial and operational areas to understand where there are improvement opportunities. And then the third component of our solution, which adds to the overall TAM as well, is providing the right domain expertise, the right services expertise. So let's take a further look by going to Slide 12, at a deeper dive into each of the 3 components of our solution. I'll start at the bottom of this page with the data and analytics platform, which we refer to as DOS or the Data Operating System. So we've continued to invest heavily from an R&D perspective in building out the most robust data platform that is available in health care. And that includes the traditional data warehouse components, that also include the automated capability to connect to the most common data sources that are most relevant for improvement work across clinical, financial and operational areas. All of our data platform instances, all of our new data platform instances in the vast, vast majority of our existing data platform instances are cloud-based, hosted in the Microsoft Azure environment. We enable our clients to tap into the -- to the technology scalability coming out of Silicon Valley and enable that positive scalability through those partnerships like with Microsoft and Snowflake and others. And then we invest heavily and where we differentiate is at the health care content player with a constant updating and strengthening and innovating around health care content, reusable data logic, machine learning models, terminology and specific algorithms that can be leveraged right within the data platform from a self-service analytics perspective, where we've got built-in AI capabilities that clients can take off the shelf and also deeply understand. And then we also have benchmarking capabilities that we've been able to link across all of the instances of our data platform to provide those clients with a benchmarking perspective of their performance at a foundational level. That leads us then to the second layer, the second part of our solution, which is at the analytics layer that we have continued to invest heavily, both organically and to be active in the M&A landscape to strengthen our offering in the 4 categories of clinical and quality, population health, financial and operational and a new research offering that we've introduced over the past year. In the clinical and quality area, we have an application suite focused around patient safety as well as a whole library of clinical accelerators focused around different specific clinical improvement projects and priorities. And our recent acquisition of Twistle brings a patient engagement component to all of our clinical and quality improvement work that we can offer up to clients. From a pop health perspective, we've continued to heavily invest both from an R&D perspective and from an M&A perspective to offer more and more full and differentiated population health offering. And that includes recent additions from a launch perspective that we've built internally around Value Optimizer, for example, and recent acquisitions like the Twistle acquisition and strengthen our patient engagement offering. In the financial and operational area, we continue to invest here, and we're excited in 2021 to have introduced PowerLabor, PowerCosting as a strengthening of our overall value proposition there. And our recent acquisition of Vitalware has strengthened our ability to offer chargemaster management capabilities as well as then to grow into the price transparency space. And then as I mentioned earlier, we've introduced a research offering for life sciences customers that includes important capabilities and differentiated capabilities, though we're early stage there around clinical trials and real-world data registry building as well. All of this is complemented by our specific domain services expertise. But first and foremost, in the areas of data science and analytics, but also inclusive of clinical, financial and operational experts that are recognized nationally as leaders in their field that our clients can tap into. All right. Moving on to Page 13. From a competitive landscape perspective, we continue to see similar dynamics occur at the data platform layer at the bottom of this page, where our most common competitor continues to be homegrown solutions, where a CIO builds something on their own, sometimes with help from cross-industry tech vendors where they can get great scalability, but they're on their own as it relates to all of the health care specific content that we differentiate ourselves on. Our commercial grade version is better, faster and cheaper. And we couple that with our partnership with Microsoft to enable that tech scalability that they could otherwise -- they would otherwise be interested in as well. The EMR vendors are another alternative at the data platform layer, but they have some structural disadvantages in primarily being built architecturally as a closed system, which makes sense if you're an EMR, doesn't make a lot of sense if you're a data and analytics platform. So we've been built from the ground up to be flexible and open, and that's a differentiator for us. At the apps layer, there are hundreds of point solution vendors that are often very, very good at a single use case. Where we differentiate is not only in our ability to help with that single use case, but also to leverage our data platform strength and our services expertise to help them in other use case areas as well. We found that the combination of those 3 components of our solution that they can get all from Health Catalyst is really where we differentiate competitively. Next, let's go to Page 17. As I mentioned before, at the center of our strategy as a company, is world-class team member engagement. We have been recognized 74 times as a best place to work within health care, within technology and outside of health care and technology as well. We've maintained, as I mentioned, even up until 10, 11 days ago, 95th to 99th percentile engagement levels within our team member base, and that is a true differentiator. And it leads to these engaged team members helping our clients be deeply engaged and become evangelists for Health Catalyst. And we continue to see real industry differentiation in terms of our relationship with clients, their engagement and loyalty to Health Catalyst as they realize measurable improvements. Next, on Slide 18, that overall engagement is at every level of the company, including our executive leadership team, where we continue to benefit from the ability to attract and then retain for long periods of time, world-class, really differentiated and excellent leaders that help us in all functional areas and departments of the company. We continue, as per Page 19, to emphasize operating principles of improvement, ownership, respect and transparency with all of our team members. And on Slide 20, the same 4 cultural attributes of every team member being a continuous learner, being hard working, having humility and also striving for excellence to be world-class in every position at every level in the company. On Slide 21, we continue to be excited about all the strategic levers that give us confidence in our long-term ability to drive that 20-plus percent growth trajectory that we've seen historically that we believe we can maintain for many years to come. That starts with monetizing our core offering. We continue to focus on how we can expand within our current customer base as well as how can we take this very underpenetrated segment where we still estimate we're perhaps 6% penetrated and expand the number of net new DOS subscription clients that we're adding each year. Those are the 2 primary components of our core growth, and we have other components that can add to our growth trajectory and accelerate our growth over time. That includes adding new applications and services through our own R&D efforts. It includes moving into adjacent markets like life sciences and international. And it also includes growing through acquisition. We believe there's a continued opportunity for many years to come for Health Catalyst to be a consolidator in the apps layer of the industry. And speaking of that, the last slide that I'll share before turning it to Bryan for some financial analysis, would be an update as it relates to the execution around our M&A strategy. Since the company has gone public, we've become more active in the M&A landscape. We've had the capital structure to support that. And we see and we continue to hear from clients over and over again, that they want us to be a consolidator. We also hear from prospective targets that they often want Health Catalyst to be the successful acquirer. Because we're a best place to work, we have very high team member engagement and we take care of clients. And so we have seen a progression in the way that we think about the spectrum of potential M&A opportunities from small tuck-in acquisitions like the Able Health acquisition in February 2020 to progressing to larger acquisitions like Vitalware and Twistle. And we believe that that spectrum will continue to grow as Health Catalyst grows in terms of where we will focus and where we can be a differentiated acquirer -- an acquirer of choice, particularly at the apps layer. We'll also continue to focus and keep our eye on opportunities from an M&A perspective in adjacent markets of life sciences and international. We are excited by a wide range of targets at the apps layer that may result in us accelerating what we can offer to our clients from a time-to-market and time-to-value perspective. And we believe that we will continue to be differentiated as a destination of choice for those targets that want to be acquired that they'll prefer to be acquired by Health Catalyst. With that, let me turn it next to Bryan.

Thanks, Dan. Great. So if you move to Slide 23 in the presentation, I will share a few highlights of our attractive financial model. I'll start with the first point that Dan mentioned, which is our revenue streams are greater than 90% recurring in nature. And that is a combination of both our technology subscriptions as well as our recurring services, of which the vast majority of our services are delivered on a recurring basis to customers. So that revenue structure provides us with really strong visibility in a given year. Next, Dan mentioned our long-term revenue growth target of 20% plus, which is a combination of the 2 components that you see in the middle of the slide, our ability to retain and expand on existing customer relationships which we measure through our dollar-based retention rate as well as our ability to add new DOS subscription customers on an annual basis. That revenue growth profile has driven over time, improving gross margins and operating leverage for our business. I show here on the slide that our 2017 gross margin in aggregate was approximately 41%, and that has migrated up to approximately 53% for the year-to-date Q3 2021 period. As well as we have driven additional operating leverage, as you can see on the bottom of the slide, related to operating expenses as a percentage of total revenue in 2017 being about 90%. And then the Q3 year-to-date 2021 period being about 56%. We do feel confident in our ability to continue to drive both gross margin and operating leverage improvement as we drive toward that long-term revenue growth target. If you move to Slide 24, I'll dive into a couple more metrics related to that revenue growth profile. You can see on the left of the slide, our revenue growth over -- in year-over-year periods broken out by revenue segment, so technology and professional services. You'll see in that Q3 year-to-date 2021 period of time, our revenue growth overall was about 31%. And you can see the mix of technology relative to services in that most recent period of approximately 61%, which has picked up a little bit over time just given some of the shifts that we've seen in terms of technology revenue growth relative to professional services as well as some of the acquisitions that we've done, which have skewed a little bit more toward technology revenue. In the middle of the slide, you'll see our dollar-based retention rate trend over time. So in 2020, that number was 102% relative to the historical performance prior to the pandemic of 107% to 109%. The 2020 dynamic was, in particular, driven by a professional services impact from COVID-19, where our professional services retention rate was less than 100%. Our technology dollar-based retention rate remained robust, similar to those 107% to 109% historical levels in 2020. As Dan mentioned, we haven't yet updated the market in terms of our 2021 performance on our bookings metrics for dollar-based retention rate or for new customers, but we will as part of our upcoming earnings call. And we did share those metrics and our expectations just in November in terms of dollar-based retention rate trends and new customer adds. The last part of the slide on the right is our total customer base over time. So as Dan mentioned, as of the end of 2020, we had 74 DOS subscription customers and then over 300 non-DOS subscription customers, which are primarily customers that we added via acquisitions. We also refer to those as app-only customers. And that customer base does represent a cross-sell opportunity for us in terms of driving DOS customer adds into those app-only customers as well as selling applications that we've acquired to our DOS customer base. On the next slide, so Slide 25, I'll show a couple of metrics around our gross margin trends over time. On the top of the slide, you'll see our technology gross margin line, which has picked up from the mid-60s to the high 60s in the most recent time period, driven primarily by revenue growth that continues to shift more toward application technology revenue relative to DOS or platform technology revenue. Bottom of the slide shows our professional services gross margin segment over time, which has fluctuated quite a bit more than our technology segment; and that is driven by a variety of factors, including the mix of services that we provide to our customers in terms of our higher-margin analytics and consulting services relative to our lower-margin outsourced and implementation service. Also a factor of our utilization rate of our team members to ensure that we're not overburdening or overutilizing team members as we deliver to clients. And then in the middle of the slide, you will see the combination of technology and services. So overall, gross margin has ticked up from the 40s, like I mentioned, to the low 50s in the most recent time period. And that is a function of both segments improving as well as the mix shifting slightly more toward technology revenue. The last slide on Slide 26 that I'll touch on speaks to long-term targets and model. On the top of the slide, you'll see our long-term revenue growth target of 20% plus, which we covered in Dan's remarks, driven by our retention rate and new customer adds. Gross margin is the next line there. Our long-term gross margin target is in the high 50% relative to where we are in the low 50s now. And that is driven by technology segment improving to the mid-70s and services to the mid-30s, with the technology segment primarily being driven by, again, shifting toward more application revenue, which is higher gross margin revenue that our customers can add after they deploy the DOS platform initially. And then as you look at operating expense and adjusted EBITDA, our long-term adjusted EBITDA target is 20% plus. We do expect, via that revenue growth, gross margin improvement to continue to drive -- also drive operating leverage, just given we have invested significantly and are able to scale those investments across sales and marketing, R&D and G&A moving forward. So I will pause there, Annie. I think that's all we have prepared. And I'll kick it to you for any questions.

Great. Wonderful. So we'll open it up to Q&A. If you have a question, again, hit the ask a question button in the portal, and we'll be sure to take questions from the audience. But maybe I'll start with the first one. At your Healthcare Analytics Summit this year, you focus a lot on value-based care. So can you touch on how conversations with your customers are evolving around value-based care? And what's the appetite for value these days?

We're finding that the appetite is high. It continues to be high and that has been the case really for the last year or so, Annie. And so we continue to have many conversations. This is among the most active portions of our pipeline, both with existing clients and with new clients, along with revenue and cost optimization. Those are probably the 2 areas of most interest right now. And both of those areas of interest are driven by the financial strain that health care providers are facing in light of the pandemic, and that continues to be something that is important for them to be able to manage in taking on more risk and understanding those value-based care arrangements and really optimizing for them. We've been fortunate to have been investing heavily, both on an R&D perspective as well as from an M&A perspective in building out more and more robust capabilities. So whether that's -- as it relates to regulatory measures, which continue to be really important for our health system clients with the Able Health acquisition or being able to address embedded care gaps within the EMR, our healthfinch acquisition helped with that. Patient engagement is an incredibly important component of pop health and something where health systems are increasingly, I think, feeling threatened by new entrants and disruptive entrants that are trying to take over that primary relationship between the patient and the provider. And so having a patient engagement alternative and answer to those disruptive threats has been really important. And then at a strategic level, understanding what should I be prioritizing as it relates to value-based care whether that's specific individual contracts or potential relationships, our value optimizer solution really, really helps. I think this will continue to be a really important area for health care organizations throughout 2022. And so we're going to continue to keep our focus there.

That's great. Throughout the pandemic, the technology business really saw great dollar retention. You saw unprecedented use of the technology platform, but the professional services business, as you touched on, had a little bit more of a headwind. It was just a little bit more difficult for you to get in there and do it. So could you help us understand how far in advance are those contracts made for professional services? And as we think about next year, is there still a lag? Have you caught up? How should we think about that maybe relative to how you performed in that business in the past? Because I know you've always said that you expect those 2 businesses to grow similarly.

Yes, great question, Annie. And we did see, especially in 2020, an impact -- a negative impact to our professional services business. And because our professional services business is largely recurring in nature, like our technology business is recurring in nature, the downstream revenue impacts from one year often manifest themselves in the next year. And so that 2020 difficulty we faced in professional services largely played out in the P&L in 2021. Now we've seen through the first 3 quarters and reported through the first 3 quarters of 2021, a robust strengthening of our professional services business, but that largely will show itself and manifest itself in 2022. And so we are pleased to see that professional services dollar-based retention strengthening meaningfully in 2021. In our next earnings call, we'll share more information about the overall company dollar-based retention. And that metric that we realized in 2021 will really manifest itself in 2022 from a P&L perspective. Anything, Bryan, you would add?

Yes. Just one other note, Annie, in terms of your question around when our contracts entered into and how far in advance do you see that. Most of our professional services contracts are entered into in a similar way to our technology contracts with the new DOS customer add at that time and are kind of priced out over a period of time, 3 to 5 to 7 years, similar to the technology. The main difference is that on the services side, customers are able to flex up and down a little bit more quickly than they would be on the technology side as an example. So we do enable customers to tap into expansion capabilities within the same contract in a lot of cases for additional consultants and experts as needed. And they can also, if needed, ramp those down with some notice period that is much shorter than the technology side. So that does provide more flexibility, which is I think what played out in 2020 where as health systems went through rebudgeting process and a reallocation process, we did see some contraction on some of those FTEs in that year. But as Dan mentioned, we do expect a material improvement on that dollar-based retention rate for services in 2021, which will flow into next year.

That's Great. And how are labor shortages impacting you in that business? Because it's something that we've been hearing about from everybody is obviously that's the labor component of your business. So how should we be thinking about how that impacts your margin and the ability to attract talent?

Yes, it is something that we have been focused on for many years. We're benefiting from that long-term focus on team member engagement and seeing that our turnover rates continue to be much lower than the industry turnover rates and the industry experience. But it is a tight labor market. It's as tight as I've seen it in a couple of decades. So we are also trying to understand the inflation impacts, which are transitory and which are longer term. On the side of the transitory impacts, we announced at last earnings call that we were going to do some onetime bonuses to recognize our team members' strong performance and their contribution to the company's strong performance and to address some of those transitory components of inflation that were real that team members were experiencing. We're also in the planning process now, and we're finalizing the more long-term components of the compensation that we offer to team members. We continue to prioritize being really competitive as it relates to compensation. And what we're planning is on the higher end of the range of what we've historically done from a compensation perspective, but it's still within the range of what we've historically done for our team members. And we believe that will be sufficient for us to continue to be a best place to work, to continue to be really differentiated as it relates to attracting and then retaining talent.

Great. And then...

I think one note on that.

Yes, go ahead.

I'm sorry, just one note on that, Annie, on the contract dynamic there, I think I mentioned that our professional services contracts typically have pricing spelled out for 3- to 5-year to 7-year period of time for a new customer, which generally have escalators in that pricing that are more akin to kind of historical inflationary rates or cost of living adjustments on those rates. So that is something that we are working through as well from a professional services gross margin standpoint. But I understand, are we able to offset any wage pressure via renewals, but it is somewhat tricky in that we do have those price points kind of spelled out for our customers ahead of time.

That's helpful. I'm going to take a question from the audience, which is: when do you expect to have positive EPS and positive cash flow from operations and/or free cash flow?

Yes, we have shared publicly when we went public as we were in the process of going public that we expected in our core business to begin 2022 at an adjusted EBITDA breakeven run rate basis. And as we shared in our most recent earnings call, our core business has been on track. We, in fact, had Q2 of 2021 and the first half of 2021 that were adjusted EBITDA positive for those periods of time in 2021. But there are some seasonal components to our business, and acquisitions impact that overall performance. And our Twistle acquisition, as we shared in our most recent earnings call, did have a negative impact, both in 2021, and we anticipate a negative impact from an adjusted EBITDA perspective of a few million dollars. But that core business remains, as we shared in our earnings call, on track to achieve what we had indicated we would achieve when we went public a few years ago. Anything Bryan, you would add?

That's right, Dan. Yes, we'll provide on the next earnings call, to Dan's point, specific 2022 guidance as it relates to EBITDA. So more to come there. On the question related to free cash flow, I would just add that our -- we haven't shared yet publicly a target in terms of free cash flow breakeven relative to EBITDA. But it is good to note that our free cash flow does lag our EBITDA contribution just given that we do have some cash flow components outside of that EBITDA metric, including interest expense, capital expenditures as well as internal use software or capitalized R&D that can impact that free cash flow line item. So that will have a lag as you think about the cash flow breakeven relative to EBITDA, but we'll provide more color on that metric as well over time.

We're in our last minute here. I was hoping you could share with us what you're most excited about for 2022?

Well, there's a lot to be excited about. I know right now, we're in the midst of the latest wave of the pandemic, and that can feel discouraging. And I know in talking with many C-suite executives at our clients, burnout and discouragement as it relates to the ongoing challenges of the pandemic are very real. And yet, at the same time, I think there are reasons to be optimistic, to be excited about us getting through the worst elements of the pandemic and being strengthened and in a position by virtue of those experiences to really build on our ability to have gotten through that. And from a data and analytics perspective, we really feel we're in a renaissance period where the increased use of data and analytics from an AI perspective is leading to a number of incredible innovations and breakthroughs that can make our health care ecosystem more efficient, more effective, lead to measurable improvement, massive improvements. And so we're really excited to see in 2022, an ability to move to a new phase as it relates to our response and our ability to live with the realities of COVID but then strengthen our focus on the use of data and analytics to really provide breakthrough innovations and significant improvements -- clinically, financially and operationally -- that we all have been hoping for, for many years. So we're optimistic. We're really excited to work hard to enable many of those innovations that we've been waiting for, that are becoming more and more a reality, particularly around AI that we see more and more of our clients starting to adopt that and realize very tangible benefits. And so I think a lot of those benefits will be accelerated in 2022, and that's certainly a reason for optimism.

That's terrific. Thank you so much for sharing your time with us today, Dan and Bryan. We really appreciate it. And thank you to everyone who joined today's session.

Thank you. Thanks for having us, Annie.