Waystar (WAY) Q2 FY26 earnings call: guidance and Q&A

What are you seeing in transaction volume/patient pay given market changes (ACA, Medicaid)? How are customers responding to combat these changes?

Patient utilization is returning to the long-term average of 1-2% growth. Regulatory uncertainty and decreasing Medicaid lives create demand for Waystar solutions, as providers focus on lowering collection costs, optimizing payment yield, and detecting coverage. The platform approach helps combat point solution fatigue.

“We know that they want to use a platform approach versus a point solution because there's this point solution fatigue where many of them are using well over a dozen point solutions in a patchwork way to try to figure out how they can optimize their collections and address their patient population.”

asked by Ryan Daniels · answered by Matthew Hawkins

What is the pitch for Iodine, and how are you seeing responses against module components or embedded EHR players?

Client interest in combining clinical and financial intelligence is strong, which was the opportunity with Iodine. This helps prevent denials by reaching upstream into clinical workflows and detecting anomalies. Over $6 million in bookings came from existing Waystar clients purchasing Iodine capabilities, validating the strategy.

“We are seeing client interest in combining clinical and financial intelligence. And that's exactly the opportunity that we saw when we acquired Iodine. We know that in doing so, what we're doing is effectively reaching further upstream into the clinical workflows and beginning there, working to prevent denials from occurring in the first place.”

asked by Michael Cherny · answered by Matthew Hawkins

What is Waystar's appetite for other vertical RCM solutions, like medical coding software, tied into CDI?

Waystar is focused on building a robust autonomous revenue cycle solution. The Iodine acquisition unites front-end, middle, and back-end capabilities. The company believes it has the right to explore areas like autonomous coding, given its work, and is studying the space carefully to expand its addressable market opportunity.

“On the other end, you highlighted coding. And in particular, there's the autonomous coding category or the auto coding category. With all the work that we're doing, we believe that we have the right to explore that area and expand our addressable market opportunity.”

asked by Steven Valiquette · answered by Matthew Hawkins

Are you seeing more large provider RFPs this year, and what are they specifically seeking? Is Iodine a lead catalyst?

There is an uptick in RFPs, leading to strong bookings, with some implementations taking longer due to the multi-solution nature. This reflects a 'Phase 2' market shift, where Waystar is well-positioned to win, as evidenced by a recent KLAS report naming them a top platform solution.

“We are seeing an uptick in RFPs, and we're participating in more RFPs, and that is leading to the types of strong bookings results that we see. And because these are larger wins, recent wins and as we look ahead in our robust pipeline, there are RFP activities going on within our bookings pipeline, these -- some of these are taking slightly longer to implement.”

asked by Scott Schoenhaus · answered by Matthew Hawkins

How did the transaction component trend versus internal expectations, specifically patient vs. provider volume?

Patient utilization aligns with expectations and guidance (1-2% annual uplift), despite tough comps from elevated 2025 utilization. Volume-based revenue grew 3% YoY, but on a normalized organic basis, it was more like 8% YoY, reflecting specific large client implementations from the prior year.

“If you were to normalize the items that we talked about that on prior calls, whether they were specific to '25 or earlier in '26, that volume-based revenue on a normalized basis is more like 8% year-over-year.”

asked by Brian Peterson · answered by Steven Oreskovich

Why isn't guidance raised by the full amount of beats in Q1/Q2? Are there specific back-half dynamics?

The company is pleased with its performance (9th consecutive beat) and confident in its full-year outlook. The guidance reflects a balance between strong EBITDA production from internal initiatives and the need to invest in AI for long-term growth. Higher capitalized software spend is part of this investment strategy.

“We're balancing that with the tremendous opportunity we see to continue to invest for the long-term growth of the business. And that is additional growth investments in AI and continuing to position Waystar to be the category leader of this AI-first autonomous revenue cycle platform.”

asked by Brian Tanquilut · answered by Matthew Hawkins

How is the cost to compute for AI integration being managed and baked into guidance, especially with the Google partnership?

Internal initiatives are designed to cover cost of compute, maintaining gross and adjusted EBITDA margins. The company has a strong contract with Google and an internal AI governance model to manage token expense. They expect to effectively manage these costs while continuing to deploy AI-powered solutions.

“What we do at Waystar, we have an internal governance model, an AI governance approach that really could be exportable, and we could help our clients manage the way they think about AI.”

asked by Richard Close · answered by Matthew Hawkins

How does Waystar compete against EHR vendors moving into rev cycle, and what is the client decision-making process?

Revenue cycle management is not a natural extension of EHRs. Waystar views itself as a 'system of action' where EHRs are 'systems of record.' Clients prioritize outcomes and ROI over novelty or 'free' built-in solutions, as a high denial rate makes any solution expensive. Waystar provides immediate, proven benefits.

“I think where we see the decision tree is -- and by the way, we haven't really noted a change in the competitive environment. So I think that's really important to establish here. The decision tree is, first and foremost, clients want outcomes. They prioritize outcomes and ROI more than they do novelty point solution and free or built-in cost.”

asked by Charles Rhyee · answered by Matthew Hawkins