Strata Critical Medical, Inc. (SRTA) Earnings Call Transcript & Summary

Okay. Good afternoon, and welcome to the second day of JPMorgan's 2023 Industrials Conference. Really pleased to have Blade Air Mobility here as part of and this year, we added eVTOL and Urban Air Mobility to a conference that has a long legacy of airlines and aerospace defense companies or leasing companies. So it's been a great addition. Will Heyburn, CFO, is going to walk through our presentation and move to Q&A. So Will, thanks for joining the conference.

Thanks for having me, Bill. Great to be here. Will Heyburn. Great to meet everyone, and good to see some folks in the room here. Before we get started, just real quick, today's presentation, we'll have some forward-looking statements. As you know, they're subject to risks and uncertainties. So I would encourage everyone to go online, ir.blade.com and read the full disclaimer. So with that out of the way, Blade is aggregating and serving customers in the air mobility market today that can be profitable today using conventional aircraft. We are doing this with an asset-light model, so we don't own or operate any aircraft, and that has allowed us to be incredibly capital efficient as we grow. And it's also allowed us to maintain a lot of flexibility, to use aircraft in the right locations, right markets, right use cases that makes sense in any given macro environment or any given part of the season, irrespective of what's going on in the economy. It also enables us to be ready for the eventual introduction of electric vertical aircraft. EVA as we call them or eVTOL as the industry likes to say. These aircraft, we believe, are going to be quieter, are going to be less expensive and are going to allow us to create more places to land. Because the primary thing communities are concerned about with helicopters is the noise, and that's the biggest limiting factor in terms of stopping us from opening new places we can land. But in the meantime, we're 100% focused on scaling our business to profitability with conventional aircraft, and it's allowing us to build a number of unique advantages that are going to persist well into the transition to EVA. First and foremost, we're building our list of customers, both in terms of transplant centers that we serve on the medical side and in terms of passengers that we serve around the world. We're building exclusive infrastructure at locations where it's incredibly scarce, like Manhattan, where we have the only passenger terminal at West 30th Street, the only passenger terminal at East 34th Street. We're building technology that's specifically designed to go consumer to cockpit and serve the urban air mobility industry. We got operator relationships around the world, everywhere we need them in terms of organizations that can maintain, staff and operate the aircraft that we use all through this third-party network. And of course, all of this leads to a great global brand that's trusted both by passengers who fly with us and by hospitals who sign multiyear contracts with us to move organs for transplant patients. Quickly touching on the business lines. We've got our passenger segment and our medical segment. On the passenger side of things in short distance, tend to fly between 10 and 100 miles. We're doing this primarily in Vancouver, New York and Southern France. On the jet and other side, primarily full aircraft jet charter, but we do have a seasonal jet service between New York and South Florida that's available by the seats. And then in our medical business, we are providing end-to-end transportation of organs for transplant centers and organ procurement organizations all across the United States. Most important thing about these 3 different business lines is there's complete fleet commonality across the business lines. The same helicopter, we might be using to fly you to JFK or Newark today could be flying a heart for NYU Langone tonight. The same jet that you might be using to fly down to South Beach could also be flying a pair of lungs in from Nashville up to Rochester. This allows us, again, to be incredibly flexible and respond to the macro environment. It also gives us additional ability to serve our customers where they need us most at the right price with the least amount of repositioning and the best availability. Clicking into short distance with a little more detail. In short distance, we're focused very narrowly on areas that are highly congested or geographically contested. We're doing this in a mix of by the seat, meaning Blade is taking all the risk of flying the full aircraft, and we need to fill enough seats in order to make money; or full aircraft charter, which is a very large part of our business as well. We're targeting 20% to 30% margins in this short distance business. In charter, you're going to hit those every time, right, because you're pricing the full aircraft or whatever you need to make those target margins. And by the seat, you're going to get there, and we are there in all of our mature markets once you get to about 70% average passenger utilization, but there is a ramp when you're launching something new like what we're doing right now with Blade Airport here between Manhattan, JFK and Newark. Again, we're an inch wide and a mile deep and we're focused on places where we can deliver fantastic value prop to our customers in terms of time savings at the right price. For example, in New York City, we fly between Manhattan and JFK starting $195. If you checked your Uber app right now, that would be about what you would find for an Uber Black, maybe even a little bit more. In Vancouver, for example, we're flying between Vancouver and Victoria, $200 to $300 a seat. Your alternative is driving to a ferry location, then it's going to be a multi-hour journey or taking seaplanes that aren't able to operate at night or in poor weather conditions. So we try to find those examples of places where we had a huge competitive advantage relative to ground or other competition. MediMobility, which is about half of our business. We're now the largest provider of dedicated air transportation for human organs in the United States. And before I dive into the specifics of our business, I wanted to give a quick primer on how organ transportation works for folks who might not be as familiar. So UNOS is the governing body in the United States that helps allocate organs between the donor and the potential recipient. Once that match is made, the quarterback of any organ transplant is going to be the transplant center that is putting in the organ into the recipient. That is Blade's customer, and that is our credit. They may be getting reimbursed on the back end from insurance, from Medicare, Medicaid, but our credit is a transplant center and they always pay on time. We're not taking any risk on that reimbursement side of things. We're focused primarily on heart, liver and lung today. That's because these organs need to get where they're going between 4 and 8 hours. So it requires dedicated transportation and it also requires incredible choreography to make sure that the ground, rotorcraft, fixed wing that we all put together as Blade works seamlessly to save these hospitals' time. Because every minute longer, you take to get an organ to where it needs to go, you can see on a chart the likelihood of organ rejection goes up. So hospitals are very focused on your ability to act quickly and deliver things on time. Blade has a lot of competitive advantages in this space, now the least of which is the diversity of our fleet, both in terms of the different kinds of aircraft that we have access to, but also their geographic diversity across the country. We help our hospitals find aircraft where they need them, when they need them, which provides a lot of advantages relative to a mostly fragmented competitive landscape of mom-and-pop operators of jets that are based near the transplant centers that they serve. And the old way of doing things that worked very well when almost all trips were a round trip, sending a team from the transplant center to go harvest an organ and bring it back. Increasingly with the use of new technology and with the ability to have local surgeons procure an organ and ship it unaccompanied, Blade has a huge competitive advantage and that we can source an aircraft near the exporting hospital. We have that aircraft waiting on standby. To the extent the organ is rejected the hospital incurs only a minimal cost. Whereas in the old paradigm, they would have had to already fly that aircraft and had it waiting, they incur the full cost of a round trip. We're seeing tremendous triple-digit growth organically in this business. And it's because of the competitive advantages that we provide, we think that our market share today is probably somewhere in the high 20s on heart, liver, lung. Kidney is an area that we haven't focused as much because kidneys take 48 hours -- up to 48 hours they can get to their location. And so frequently, they're shipped next flight out. Though it is an area we think that we can grow into. We believe there's no reason we shouldn't be the majority of this market, meaning we believe we can double from kind of current levels here in the organ transportation space. And we're also excited to see huge intrinsic growth in the industry itself. If you look at the UNOS data of just the number of organs that are being transplanted, it's high single-digit, low double-digit year-over-year growth that we're benefiting from. Some of this is driven by really exciting new technology in terms of organ preservation. So for decades, the primary way you move an organ is you literally put it into a cooler. This is all changing. And now there's new technology that can take that 4 hours that you used to have to get a heart where it needs to go, and extend that using profusion technology that keeps fluids flowing through the organ. That's provided a benefit, obviously, to transplant recipients, but it also has improved our business model because you're growing both traffic and ticket. Hospitals are able to go after organs because they didn't have a match that was close enough, might have been thrown away. But then you're also flying further, and increasingly, you're using larger aircraft to accommodate this equipment and to accommodate the distance. So we see a tailwind that's not just the volume of trips that we're doing, but also the choreography and the size of the equipment that's necessary to make it happen. We've also used M&A strategically, particularly in this business. So Blade was the largest in New York City. In terms of organ transportation we built that business ourself mostly because, for better or for worse, we had pilots and aircraft sitting around waiting to see if somebody wanted to go to Atlantic City in the middle of the night. We realized that a far better use for those aircraft was to help the hospitals and our community here in New York to move organs, and we started doing that. We realized though that one of the bigger value adds was our nationwide network of aircraft, as I talked about earlier, and that's when we made the decision to grow into a national platform through acquisition. As you can see on the chart here, we acquired Trinity Air Medical. The team was doing a fantastic job growing 20% to 30%. But they did not have our diversified fleet model. And thus, when we finished that acquisition, we were able to massively accelerate growth through the triple digits on an organic basis a business that we bought for about $23 million, $24 million. Now combined with the -- some revenues that we contributed from Blade, did $5 million of segment adjusted EBITDA in 2022. So we've grown that business incredibly well, brought down our purchase multiple in that business. Given that we have the access to these aircraft on the medical side, we do also sell jet charter, which is a great business for us. It's incremental flight margin, very minimal fixed cost. And it provides a number of benefits to medical because it gives us more throw weight to negotiate with operators and get great prices. It gives us a broader network. And we just priced that as a consistent 10% flight margin. So you're not taking risk since we don't own or operate any of these aircraft. We have built by focusing on markets that work today, make money today with conventional aircraft and can scale today. We built a great moat for Blade. It's like -- for Blade, that's like nothing else in the air mobility industry. And we expect that moat to provide huge advantages, particularly as the market starts to expand more rapidly with the introduction of EVA. I'll quickly go through a few of these benefits. As we talked about on the asset-light side of things, this gives us a lot of flexibility. But it's also a great deal for the third-party operators that we work with. Our operators pay all the costs associated with flying and maintaining the aircraft, pilots, fuel, maintenance, liability insurance. Importantly, the liability sits with those operators. But by working with Blade, they're able to eliminate some fixed costs, like their customer service team, like any staff they might need to have on the ground, at an airport or a heliport. They also, even more importantly, are able to increase the number of hours they fly per tail per year, and that provides a huge benefit as you're amortizing those fixed costs over more hours. So generally, by working with Blade, you have lower fixed costs, they're amortized over more hours. It costs less per hour for the operator to fly. That's a benefit to them. They're actually making more money because of the volume. It's a benefit to us because we're paying less per hour. And it's a benefit to the hospitals and the passengers we serve because we're able to do this incredibly efficiently. It wouldn't be possible without the Blade system because we're aggregating demand from so many different places, medical, passenger, different day parts, medical is mostly at night, passengers mostly in the day. It allows us to create efficiency that you just couldn't create as a lone 135 operator. Of course, safety is the most important thing here. I know the FAA holds these operators to a very high standard. We have our own 5-person safety team that's visiting all of these operators in person, making sure that they don't only meet but exceed these FAA standards. We talked about the global footprint, but you'll notice there's a laser focus on the markets that make sense, and that's allowed us to get incredibly entrenched in these markets from the perspective of infrastructure. We talked about the example in New York, where we have the only passenger terminals that are available at the 2 most convenient heliports to Midtown. We have similar advantages in places like Vancouver and Southern France. We believe that we will be using today's existing infrastructure for a very long time. It's got additional capacity. EVA should help us take advantage of that. But as you've seen, cities like New York move very slowly. And when it takes 10 years to build a free park on the West Side highway, for those of you who have been visiting Little Island, we think it could take similarly long times to create new heliports. When they do arrive, they're going to be massive expanders of the addressable market, and we think EVA will unlock that. But we believe after the initial introduction of EVA, Blade will have a huge and unique competitive advantage that no one will be able to match because we have this terminal network. Our technology is also very unique, not the least of which because it's been built from 8 years of actually flying people and actually moving organs for hospitals. You can't understate the advantage of battle testing your software, and we think we have the most robust platform solely because you can use it today, it works. It manages consumer to cockpit, everything, not just the part you see on the app, but also our accounting works with our auditors. We've had to make it SOX compliant. Everything under the sun, there's a lot of work that goes into this that you wouldn't think about. And you don't know what you have to build until you actually start flying people. Delivering this service is not easy. Blade has become a verb in the markets that we operate in. And this applies to passenger and medical. We call it the run a show at Blade. There's people on the ground and the locations that you're working in. These are infrastructure locations that are often tucked away under highway overpasses. It takes a lot to make it work, and we've built up over years a great level of trust with both our passenger and medical customers that we believe is going to be critical, both -- and the continued expansion with conventional aircraft, but also as we move into EVA. Customers have learned to expect precision with Blade, but we had to earn that expectation. As a result, brands want to be associated with Blade. This helps us both in terms of direct cash payments but also in terms of deferring costs when brands provide some of their services in kind. And of course, all of this, everything we're doing and building and ramping towards profitability today is all designed with an eye towards the upside from an eventual transition to EVA. But we're not sacrificing our near-term opportunity and we're focused only on markets where the unit economics make sense today with conventional aircraft. We'll very quickly touch on some of the financials here. I'll skip a few slides. But as you can see, we're exhibiting great growth. We had a great Q4, very happy with the performance of the business, the medical business, profitable today on a segment-adjusted EBITDA basis. The passenger business historically has been profitable on a segment-adjusted EBITDA basis. But as we mentioned, we are making investments in a huge growth area right now, which is Blade Airport here in New York City. And given the timing of our recent acquisition in Europe in the low part of the season, that business, which we said is going to be a mid-single-digit contributor to EBITDA was actually slightly negative since we only owned it in the low season last year. So we're very excited about the way the company is situated. I wanted to just point to one more slide here about the asset-light model. You can see on our quarterly flight margin even in the face of a global pandemic, we're able to maintain our flight margins. And that's a testament to our ability to be incredibly nimble, incredibly flexible and having that fleet commonality across passenger and medical. So the proof is in the pudding, and you can see it in the numbers that we do have that flexibility baked into our model. And of course, we're very well capitalized. The asset-light model has allowed us to grow from around $25 million trailing revenues when we first went public, to $146 million today in an incredibly capital-efficient fashion. And as we said on our earnings call just yesterday, that's why most of the cash that's on our balance sheet is earmarked for additional accretive acquisitions. And we're only focused on acquisitions that are going to expand our business models and do so in an EBITDA and free cash flow profitable way. So I went a couple of minutes over my 15, Bill. Hopefully, you'll forgive me, but I'd love to take your questions.

No, that was great. That's a great 20-minute presentation. So if we just sort of think about 2023, there's obviously, great growth drivers in MediMobility. But maybe speaking to the short distance. If we think about airport, other Northeast routes, Canada and Europe, how would you stack rank where you see the growth potential as we think about this year? And what are the puts and takes associated with that? I mean we obviously know Canada kind of a slow coming out of COVID, but that might actually mean that it could accelerate faster. Europe, you're hitting -- you have seasonality as well. So how do you think about the growth potential across the various short-distance opportunities?

In short, we think there's a great opportunity in all of our passenger markets right now. I can take them in turn. Canada, you're absolutely right. you might call it an easy comp, but they had a very tough run at COVID and particularly at Omicron. As we talked about in Q4, we saw a great bounce back there. Continue to think that, that's a fantastic market with lasting appeal for all the reasons we talked about. Particularly, it's just geographically contested. It's hard to get around there. And Canada has never really done any charter work. So we're very excited in most of our mature markets. About half of what we do ends up being full aircraft charter. So that's something we're excited to introduce. We've kind of done a soft launch already, and we're looking forward to introducing our technology and some of those new products in Canada this year. In Europe, we're very excited, similar opportunity on the integration side. What we acquired there were really 3 different businesses that didn't talk to each other very well. So on the one hand, you have an opportunity to really bring a brand into play that has more global appeal, capture more of the audience that's maybe coming to vacation from North America, that's going to be familiar with the Blade brand, so we think that's going to help us on the revenue side. On the cost side, you've got an opportunity, particularly now that we've integrated our software over there to be much more efficient in terms of your use of aircraft. So for example, here in New York, if you were to fly to JFK, you'd notice that the same tail number is going back and forth between JFK and Manhattan all day. That gives us a lot of benefit, not the least of which you're not flying round trips for one leg. But also even when you're landing at East 34 or JFK, you're sharing that landing fee with an arriving or departing flight. That was not happening in Europe. You had 3 different companies. And depending on who you called, they would do a round trip just for you, pay landing fees at both places. So we see a big opportunity there. There's also a fixed wing charter opportunity in Europe that has not historically been offered, that we think is great. On the airport side, as we said, best quarter ever here in Q4. We talked about quarter-to-date here in this Q1 2023, seeing about double the volume that we saw last year. So all signs are showing great progress in airport. We think it's a fantastic product, beats the heck out of taking a 3-hour Uber and often, it beats the price. So we think we're set up in a very good situation there.

I guess just a little over 30,000 passengers, can you help break that apart? I mean you mentioned like record performance in airport as an example. Can you help size that? What that means? And when you think about doubling in Q1 2023 versus 2022, I mean does it just keep going up, or is there some seasonal impacts? Obviously, there sort of seems to be less commercial activity. But help us size these various buckets currently?

We do see some seasonality in airport, particularly in Q1. Some of that mirrors what you see in commercial air travel. Some of that is some weather impact you see in Q1 around New York. And so you do see a little bit of that. In terms of the size of our markets, what we said is sort of giving you some numbers in terms of what these markets were pre-COVID. So both Europe and Canada were around 100,000 flyer year markets pre-COVID. And then as you said, I think the last number we actually gave you was above 25,000 passenger run rate on airport. So you can kind of get a sense of where those are, and we think there's an incredible amount of room to grow in airport. Because if you look at the port authority data, 27 million people traveling between the 3 commercial airports in Manhattan every year. So we think we haven't even scratched the surface.

The airport route is -- it feels like it's one of the faster growing ones. But obviously, the flight margins are not where you want them to be now. How do we -- where does this -- when does it take to get to the kind of numbers that you'd say corporate average would be acceptable range, so to speak.

I'll reach from my remote here because we get that question a lot, and so we give you the unit economics. But what I would say is we break even about 2.5 seats out of 6 full on an airport flight. And so I think we're making really good progress toward that number. But in order to provide a great customer experience, right now, we do offer that service from 7:00 a.m. to 7:00 p.m. or even 8:00 p.m. all day. And as you know, some of those times are not the times, that the traffic is the worst or that they're the most flights scheduled for commercial airlines. And so those off-peak times are really where you see lower utilization in terms of passengers. But we think it's really important for our customers to know they can just hop on the Blade app and get to the airport whenever they need to go. So as long as we continue to see the growth that we're seeing, mathematically, eventually, you will get to that average above the 2.5%, and then you're keeping 100% of every seat that you sell above that. So it is a ramp where we've had to be patient. But because there's such a huge market opportunity, we're committed to doing that. Because we do know and we've shown our investors the unit economics makes sense there. And just as a reminder, we pay about $300 for the flight time to go to or from any of the commercial airports, and we pay about $200 on landing fees. The base price for one of those seats is $195. So if you're paying the lowest fare, you're breaking even at 2.5. But our average is closer to 2.40, 2.45, because about 20% of our flyers today, are picking some sort of flexible fare options using upgrade. So that's a huge opportunity for us as well. Our passengers have shown they're willing to pay for the flexibility.

When you -- yes, I think the landing piece is something we talked about in the prior call, that's kind of an interesting one. You addressed that quite well. And if we think about just on your existing footprint -- not footprint, your existing businesses, meaning Europe, Canada and the Northeast. What is the path to profitability with that? I mean you're already EBITDA positive on an adjusted basis for MediMobility. You're not quite there. Where can this go this year or maybe the next few years?

We're not ready to put a stake in the ground in terms of win precisely. The whole company is going to be profitable. What we have said is you should expect to see improvement in adjusted EBITDA this year. And we've talked a little bit about the building blocks to get to profitability over some period of time. So if you start with the negative 27.5% adjusted EBITDA that we did in 2022, you can start by looking at Europe, which was an acquisition we completed just before Q4, which is a period when the flight profits don't actually cover the fixed costs. So that was somewhere in the mid-hundred thousands of a negative in terms of the contribution to EBITDA in 2022. But as we've said, it should be a mid-single-digit contributor to EBITDA in 2023. So let's say that takes you somewhere to the low 20s. We've also talked about medical, which we think should be able to double from where it is today on market share gains alone. So if you take roughly $70 million and you pass that down at our 15% to 20% contribution margin, now you're about in the single digits in terms of what our negative adjusted EBITDA is. And that's before you've taken something like Blade Airport, which we've said is 150 basis point drag on margins last quarter to profitability. So when you think about the different levers that are right in front of us, and we've given you the numbers for, we think over some period of time, that's enough organically to get the business to profitability. But then there's all the things that you and I were talking about earlier that we're excited about in terms of integrating the European businesses, adding new products in Canada, continuing to grow, both through pricing and volume in our mature businesses. We've demonstrated an ability to do that, and we're going to continue doing it. And then, of course, we've got $200 million on the balance sheet, and I think you saw with the Trinity acquisition, we've demonstrated an ability to find businesses that when you plug them into the Blade platform, are going to get supercharged. That allows us to pay a fair price for a business, but know that we're going to buy that multiple down. And so we're going to continue to look for opportunities to do that. And frankly, and an uncertain maybe difficult macro environment, we might even have more opportunities to do that.

That's interesting. I'm going to pivot to medical mobility, MediMobility soon, but I just want to make sure if anyone have any questions before pivoting. Just a second. Just wait for the mic, please.

On the airport business, is there any consideration to making that less on demand just because I would assume people tend to book flights more than 10 minutes in advance? So is that one way to increase profitability? And then on Europe becoming profitable, is that something that's just kind of built in because that's the way the business always is? Or is there some volume that you need to get Europe from being the small loss, I suppose, in 4Q into a full year of contribution?

Yes. Great questions. So on the airport side of things, we have a lot of flexibility in terms of how fast do we want to run our turn times. So that's something that we can and do, do in terms of looking at demand throughout the day. And figure out if there's a whole lot of demand in the afternoon, maybe you go from the default, which is a flight every 20 minutes. And because it's only 5- to 10-minute flight, you can shorten that and you're effectively injecting more capacity into the system. You can do the inverse of that, and you can lengthen those turn times a little bit, pull capacity out and allow you to maximize your utilization. So that's the kind of stuff that our software allows us to kind of be watching at all times. We do feel right now it's important to offer availability within that full window of when most people are flying. And so we're reluctant to cut whole segments of the day out. But there's a lot of tools in our toolbox we can use to optimize passenger loads so that you have more than 2 people flying on a flight, which, of course, means that you're going to be profitable. Switching to your question on Europe. Europe is an interesting market and that it's actually predominantly full aircraft charter. That's great in terms of assurance of creating a good profit margin, because we're just pricing at that, in the case of Europe, it's around 30% target margin there. So you have a little bit less risk when you're doing full aircraft charter, though there is a huge opportunity, and there is a great business flying by the seat particularly between Nice and Monaco. So that's something we want to ramp back up that had paused a little bit during COVID and probably a nice upside opportunity for us there, if we can build that up.

Great question. So MediMobility, I think if we think back a couple of years ago, it was part of your business but not really thought about it as the growth driver. It's turned out to be a fantastic growth driver for the business. Basically no cyclicality. It should be just a good business. You talked about share going from high 20s to maybe above 50. I know you probably don't want to talk about a time frame, but what -- walk us through the path. I think your geographic footprint or your hospitals actually didn't grow in the last quarter. How is your coverage thus far? Is that -- what is how is that a part of that, is the first question. And I have a few more related to that.

Yes, sure. So the sales cycle is pretty long for a transplant center, as you can imagine. And at least for us, usually an early part of that sales cycle is starting to fly for that customer. So when we talk about the number of contracted transplant centers we have, which sits at about 67 right now, we talk about people who have signed something for a couple of years saying that they're going to work with us. Oftentimes, the way we get that signature is to start flying with folks. And then they see how much better it is, how much more streamlined and the lower cost they get over time from working with us. And even when you do sign, there still might be a transition period that takes some time. And so that's why we continue to expect to see seasonal growth -- sorry, sequential growth in that business quarter-over-quarter. And we talked about on the earnings call how we have a number of contracts that are in that late stage of signing the contract, but we are flying with many of them already. And in some cases, we might be doing all of their flying already. We just haven't signed a contract that says that the way it's going to be. So we're very lucky in that -- based on what our customers tell us, our product is better, and our product is more flexible, more reliable and less expensive. So we're in a great position, and that's because of the combination of our medical and our passenger business partially. And so we always feel confident we say, give us a try, and we feel confident that we're going to win that business. But that doesn't mean we're not going to start flying more before we increase that number. So it's an interesting metric, and we're always happy to talk about it. but it's not going to be necessarily directly correlated with that sequential growth.

But are you where you need to be? Or is this maybe potential more areas for acquisition? Just different parts of the U.S., not under coverage or maybe even overseas. Like is there other ways to think about that?

I think in the meantime, last quarter, 120% organic growth, when you're growing this quickly, we don't really feel a need to pay a multiple for customers, particularly when we look at our pipeline, and we talked about having a number of customers in the pipeline right now. I think more interesting is, is there a horizontal expansion, particularly, we've talked before about the kidney market. Right now, we do perform the service for some of our customers when there is an urgent need to move a kidney, maybe the flight's gotten delayed and you're coming out to the end of the clock. Maybe you couldn't find a match, and you found one last minute after it's been in a box for a while. That's the kind of thing we'll do for our customers using our dedicated aircraft. The important thing is we already have all the customers. So if we built that capability, and we talked about how it might be something we'd have to build through acquisition, you could take whatever business you bought. Great, you underwrite a purchase price. But then you have a whole new set of businesses that you can flow through it right away with customers that already like you. So we think that's an opportunity at some point. It's probably not something that is top of the priority list when you're growing triple digits as we are right now. And just to address your point, it's 250 transplant centers. And so they're not all created equal. Some maybe -- only do kidneys, some maybe are more on heart or liver or lung. And so one is not one is not one. But we do believe, even in terms of the number of transplant centers we serve, we can go a lot deeper.

I was doing Math, so if you did like close to 22 million in the fourth quarter, high 20s would kind of point to somewhere north of a $300 million market today. How big can this market get if you were to add kidney or other things? Is that the right number? I'm just -- that's my back of the envelope here, in this...

I wish I knew, Bill. I wish I knew. We do our best to try to figure out what it is, but it's easy to get the transplant volume data through UNOS, it's really hard to know what hospitals are spending on their flights. We think a lot of those hospitals might be spending too much right now. So it could be a little bigger than that. But when you think about the market dynamics, I'll talk just about heart, liver, lung right now, which is where we're focused. We believe that market can get a whole lot bigger. And the biggest driver right now -- and part of the reason you're seeing accelerating growth to that high single digits, low double digits just in terms of the number of organs transplanted, is because of the profusion technology, I was telling you about. So on the one hand, you can take a regular way transplant, which is usually donor brain death. And you can move that organ further. One of the other things that you can do is take an organ that is available because of cardiac death. For a lot of reasons, this is more complicated because you have fluid stop flowing through the organ. Some of this new technology enables you to have a much better shot at using one of those organs. It could massively, over time, increase the number of organs that become available for transplant. So we're very optimistic that you could continue to see these elevated levels of intrinsic growth in the market. And we think we uniquely, because of the resiliency of our network, are going to be able to help hospitals handle that increased volume.

Yes. You've talked in the past, maybe just pivoting into the EVA, you guys call it EVA as the industry calls the eVTOL. I think you've talked about maybe the early use cases being MediMobility. What is the timing that we should be thinking about that? And maybe -- we know you have partnerships with Eve and you did a flight test with BETA in magniX. For some of these electric aircraft, what is the timing that you're kind of assuming at this stage? And where are these companies out in their progress?

Look, we've been told that aircraft could start coming online 2025, 2026. I think the important thing to remember about our model is that we're -- I'm not going to say ambivalent, but the model will work. The business is designed to scale to profitability, irrespective of when EVA come on the scene. In fact, you might even be able to argue that a little bit of a delay, gives us more time to continue building these benefits that we talked about during the presentation. So we're very excited to deliver quiet, emission-free aircraft to our customers, and we know they're excited to use them. The exact timing is going to be determined by regulators, and we don't have any more insight than the CFO of Joby who just spoke. And so I think -- we're excited about it. We see that the technology works. We want to make sure that stakeholders in the cities that we operate, see that it works. That's why we did the demonstration with BETA. But at the end of the day, we remain completely OEM-agnostic. We want to use the right aircraft for the right mission for our customers, just like we do today, just like a lot of hospitals are with us because people were putting them on a Gulfstream IV to Philadelphia for an hour long flight for $20,000. We can do that in a helicopter for $7,000. We want to maintain that flexibility, and that's not going to go away with EVA. It's unlikely that any one machine is going to be perfect for all use cases. I'll go ahead and say that it's not going to be that way.

Coming up against it, like what would you say is maybe least understood? Or just areas like when you talk to investors, they just either just maybe don't get that you think there is underappreciated about the story?

I think just the flexibility of the model, our ability to use aviation assets that are third-party owned and operated for the highest and best use case in any given economy. I would think you could see it from our financials, and our ability to rapidly scale. And this was a focus of ours, a medical business, because we saw a great return in that business in this macro. We can be incredibly nimble and incredibly responsive to market conditions to create a platform that I think is going to succeed regardless of the market. And I think because people are used to asset-heavy businesses, where you're only making money on the last 10% of flights or seats. Sometimes people, I think, believe, oh, if there's some kind of macro overhang in either business there's going to -- you're not going to make any money. You're never going to be able to make money. That's not really the case given our asset-light model. We think we're set up incredibly well.

Great. Well, unfortunately, we're out of time, but look forward to following the progress and thanks again for supporting the conference. Thanks, Will.

Thanks, Bill.