Quarterly Revenue and Consensus Outperformance
Q1 revenue was $19.8M, and management stated the quarter exceeded consensus estimates on both top and bottom lines, despite YoY revenue decline.
OptimizeRx
· OPRX
May 12th, 2026
Summary
- Earnings Call Date:
- 2026-05-12
- Change Since:
- -25.24%
- Next Earnings Date:
- 2026-08-06
Earnings Call Sentiment
NeutralThe call balanced encouraging operational and margin progress (strong adjusted EBITDA growth, improved gross margins, significant product traction with DAP and subscription growth, refinancing savings, and KPI improvements) against tangible near-term top-line challenges (10% YoY revenue decline, 15-20% contracted revenue shortfall, a major client disruption, reduced cash and negative operating cash flow, and a downward revision to revenue guidance). Management emphasized these headwinds are short-to-intermediate term and highlighted programmatic/DSP initiatives and subscription mix as drivers for 2027 recovery.
Company Guidance
OptimizeRx updated full‑year 2026 guidance to revenue of $95–100 million while maintaining adjusted EBITDA of $21–25 million, and expects full‑year gross margin in the high‑60% range with revenue weighted roughly 40/60 to the second half; Q1 results included revenue of $19.8M (down 10% y/y from $21.9M), adjusted EBITDA $3.3M (vs $1.5M), GAAP net loss $0.5M ($0.03/share), non‑GAAP net income $2.7M ($0.14/diluted share vs $1.5M/$0.08), operating cash flow of –$0.5M, cash of $20.2M (vs $23.4M), debt $23.6M (with $2.7M principal paid in Q1), and KPIs showing DAP product growth of 60% in Q1 with DAP subscription revenue up 45%, average revenue per top‑20 pharma $2.8M (top‑20 = 52% of business), net revenue retention of 110%, and revenue per FTE $801K (vs $710K); management also expects ~ $3M of annualized cash operating expense savings (≈ $1M in‑year 2026 benefit, ex‑severance), refinanced to a $25M term loan with a $10M revolver at SOFR+2.25% (vs prior SOFR+8.5%) for roughly $1.5M of annual interest savings, and highlighted programmatic DSP access (DSPs control >80% of digital promo dollars) to drive greater utilization of currently <10% network inventory into 2027.
Adjusted EBITDA Expansion
Adjusted EBITDA rose to $3.3M in Q1 2026 from $1.5M in Q1 2025, an increase of approximately 120%, reflecting improved operating leverage and margin optimization.
Non-GAAP Profitability Improvement
Non-GAAP net income increased to $2.7M ($0.14 diluted) from $1.5M ($0.08) year-over-year (≈80% increase). GAAP net loss narrowed to $0.5M from $2.2M in the prior year quarter.
Strong Product Momentum — DAP Growth
AI-enabled DAP solution grew 60% year-over-year in Q1, with DAP subscription revenue up 45%, indicating accelerating product-market fit and greater subscription mix for revenue visibility.
Gross Margin and Expense Improvements
Company now expects full-year gross margin in the high 60% range. Total expenses decreased by $4.6M YoY (driven by lower cost of revenue and G&A). Management expects cash operating expense reductions of ~$3M annualized, including ~$1M in-year benefit for 2026.
Key Operating KPIs and Revenue Productivity
Net revenue retention remained strong at 110%. Revenue per FTE improved to $801K from $710K in Q1 2025 (≈12.8% increase). Average revenue per top-20 pharmaceutical manufacturer stands at $2.8M; top-20 accounted for 52% of Q1 revenue.
Balance Sheet and Financing Improvement
Refinanced term loan to Fifth Third Bank with a fully drawn $25M term loan and access to a $10M revolver. Management cites approximately $1.5M in expected annual interest expense savings from the refinance.
Programmatic / DSP Opportunity
Company is enabling demand-side platforms that control >80% of digital promotional dollars into its EHR network, estimating current utilization of <10% of inventory and positioning programmatic as a potential long-term growth channel with meaningful upside.
Operator
Good afternoon, everyone, and thank you for joining OptimizeRx First Quarter Fiscal 26 Earnings Conference Call. With us today is chief executive officer, Stephen Silvestro He is joined by chief financial and strategy officer, Edward Stelmakh, Chief Legal and Administrative Officer Marion Odence-Ford, and chief business officer, Andrew D'Silva. At the conclusion of today's call, I will provide some important cautions regarding the forward looking statements made by management during today's call. The company will also be discussing certain non GAAP financial measures, which it--these are useful in evaluating the company's operating results. A reconciliation of such non GAAP financial measures is included in the earnings release that the company issued this afternoon as well as in the Investor Relations section of the company's website. I would like to remind everyone that today's call is being recorded and will be made available for replay as an audio recording of this conference call on the Investor Relations section of the company's website. Now I would like to turn the call over to OptimizeRx's CEO, Stephen Silvestro. Mr.
Silvestro, please go ahead.
Stephen L. Silvestro
Thank you, operator, and good afternoon to everyone joining us for today's first quarter 26 earnings call. Delivered a solid start to the year, which exceeded consensus estimates on the top and bottom line. Revenue for the first quarter was $19.8 million and adjusted EBITDA was $3.3 million While we are pleased with our performance in the quarter, the broader healthcare technology operating environment continues to evolve. We...
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