The COVID-19 pandemic is driving a rapidly increasing demand for NextGen Healthcare's virtual care and patient experience technology solutions.
Since the COVID-19 pandemic started in March this year, NextGen Healthcare, a technology provider for ambulatory settings, has enabled providers to deliver over 700,000 virtual visits, nearly 200 times the number conducted in 2019.
One impact of the COVID-19 crisis is the accelerated transformation of ambulatory care, as providers look for a fully integrated approach to patient-provider interactions that includes virtual visits, frictionless payment, and patient self-scheduling tools, according to NextGen Healthcare CEO Rusty Frantz.
"The way providers engage with patients must change and must evolve. Unless providers go to a platform approach with integration, they are not going to have the patient experience that they truly need. Providers are realizing that they just moved into 'consumer land,'" Frantz said during the company's fiscal 2021 second-quarter earnings call Thursday.
"The year of provider burnout turned into the year of the patient in a relatively short order," he said.
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In March, NextGen rolled out a patient experience platform with integrated virtual visit capabilities as a result of its recent acquisitions and integration of Medfusion and Otto Health. NextGen's telehealth and patient engagement platform includes integrated virtual visits, patient self-scheduling, previsit check-in, and patient payments, according to the company.
"We intend to further capitalize on the success of our integrated solution by migrating our client base onto our Spring ‘21 release which leverages our new patient experience platform – opening up additional long-term market opportunities," Frantz said.
In September, the company launched a new behavioral health solution that integrates comprehensive physical, behavioral and oral health in one software solution. The software solution builds on NextGen's acquisition of Topaz Information Solutions last year.
NextGen Healthcare delivered strong financial results in a challenging environment as revenue grew 4% from $134 million to $140 million during the most recent quarter ending Sept. 30, Frantz said during the earnings call.
The company has seen continued strong growth in subscription revenue.
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"We delivered strong Q2 performance across almost every operational metric," Frantz said. “NextGen Healthcare offers a premium client experience in the independent ambulatory market and this differentiator is showing up in our commercial wins both inside and outside the base."
During the quarter, NextGen patient volume at the company's ambulatory practice clients rebound, which impacted its volume-based business. The company's volume-based business has returned to approximately 93% to 95% of pre-COVID levels, Frantz said.
The Irvine, California-based reported its net income for the quarter was $10.5 million compared with net income of $6.1 million in the fiscal 2020 second quarter.
Fully diluted net income per share was 16 cents in the fiscal 2021 second quarter compared to net income per share of 9 cents for the same period a year ago.
On a non-GAAP basis, fully diluted earnings per share for the fiscal 2021 second quarter was 30 cents, an increase of 25% year over year from earnings per share of 24 cents in the same period a year ago.
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NextGen's revenue and earnings in the quarter beat Wall Street forecasts as the consensus estimate was for quarterly earnings of 20 cents per share and revenue of $133 million.
NextGen Healthcare reported cash flow from operations was $30 million in the fiscal 2021 second quarter compared to $24 million for the same period a year ago. Free cash flow was $24 million compared to $17 million in the same period a year ago.
Bookings came in at $31 million in the quarter, down from $37 million on a year over year basis.
The company also is focused on building solutions to support healthcare clients in navigating the new interoperability rules from the Centers for Medicare & Medicaid Services (CMS) and the Office of the National Coordinator for Health Information Technology (ONC). The new rules implement key interoperability provisions of the 21st Century Cures Act to improve health data transparency and access.
Based on improved market conditions, NextGen reinstated annual guidance. For fiscal 2021, the company now expects revenue of between $535 and $551 million and non-GAAP earnings per share between 83 cents and $93 cents.
The company reported $540 million in revenue for fiscal year 2020 that ended in March.