National Research achieves 11% year-over-year EBITDA growth, driven by strong sales momentum and higher customer retention in Q3 2025.

Good afternoon. Thank you for attending the National Research third quarter 2025 earnings call. My name is Cameron and I'll be your moderator for today. All lines will be muted during the presentation portion of the call and I would now like to pass the conference over to your host for today's call. You may proceed.

Thank you. Operator welcome to National Research's earnings conference call for the third quarter ended September 30, 2025, I want to first let you know that we posted our earnings press release to the Investor Relations section on our website. On the call today we have National Research CEO Trent Green and our new CFO Shane Harrison. Before getting started, I'd like to emphasize that this call will include statements related to the expected future results of our company, which are therefore forward looking statements. Our actual results may differ materially from our expectations due to a number of risks and uncertainties, including those described in our earnings release and other SEC filings. Today's remarks will include references to non-GAAP financial measures. Additional information including definitions and reconciliations between non-GAAP financial information and GAAP financial information is provided in the corresponding earnings press release which is posted on National Research's investor relations website. A replay of this call will be posted to the same website. With that, let me turn this call over to our CEO Trent Green.

Good afternoon everyone and thank you for joining us for National Research's third quarter 2025 earnings call. Today I'll discuss our Q3 financial results, share a few reflections from my first 120 days as CEO and outline our near term operational and strategic priorities starting with the quarter's results. I'm very pleased with how our teams executed. Revenue reached nearly 35 million and adjusted EBITDA was 11 million reflecting 11% year over year growth. Total recurring contract value or TRCV, a valuable leading indicator of our recurring revenue over the next 12 months was rose 8% year over year to 142 million, our strongest growth since 2020. This performance reflects strong sales momentum across both existing and new customers. In Q3 we secured multiple deals including an over a million dollar TRCV expansion with a top 50 health system, two additional nearly $1 million cross sells with top 100 health systems, and a new logo win exceeding $500,000 in TRCV with an east coast health system that acquired multiple National Research products. Each of these wins came from competitive takeaways. We were selected for the breadth of our products, the value of our unique data, insights and enablement tools, and the differentiating service and client success. We we deliver day in and day out. Just as important, our customer retention continues to strengthen. Over the past year, our customer strategy team has reduced TRCV losses and downsells by nearly 50%. Additionally, we're seeing great success in expanding with our existing customers, cross sell and upsells during the quarter, a few of which I just mentioned resulted in the best quarterly customer expansion activity we've seen in six years. Together, these trends drove our net retention rate to its highest level since 2020. Now, stepping back to reflect on my first few months as CEO. After spending time with our associates, customers, prospects and investors, I'm even more confident in National Research's opportunities for growth and value creation. Our market opportunity is substantial. The US Health care landscape is evolving, defined by shifting consumer expectations, regulatory complexity, workforce challenges and financial pressure. To succeed, healthcare organizations must connect deeply with the people they serve while adapting to these systemic forces. That's exactly where National Research is uniquely positioned. Our mission to turn human understanding into meaningful, measurable action aligns directly with what healthcare providers need most. This leads me to my next reflection, the competitive differentiation National Research has built through our deep subject matter expertise and our exclusive focus on the healthcare sector. A great example of this differentiation was our annual Human Understanding Beyond Customer Conference, which we refer to as hub. Held two weeks ago in Orlando, this event brought together hundreds of leaders from health systems of all sizes and provided a powerful forum for customers to share success stories, collaborate with one another and with our National Research associates and learn about our evolving product roadmap. The energy and engagement at Hub showcase the tangible impact our products and teams are having, driving measurable improvements in patient, employee and provider experiences and health system outcomes. Through hub and my customer visits over the past few months, I've heard firsthand that our value proposition has never been more relevant. It's built on three core pillars of differentiation. First, Insights. Our platform uniquely provides continuous data on what individuals expect experience and value throughout their healthcare journey, alongside broader market intelligence on what communities, regulators and peers are saying across the healthcare ecosystem. Our second pillar is engagement. Our clients view National Research as a trusted partner, not just a data provider. They value our decades of experience and our ability to translate insight into action through deep relationships across all levels of their organizations, from boards to frontline staff. We treat all of our interactions as a true partnership and as a privilege that we strive to earn every day. Our third is enablement. We empower our clients to act, providing the tools, workflows and best practices to convert insight into measurable improvement in health system governance, brand performance and patient and employee experience. These three pillars are the foundation of our strategy and innovation roadmap. We'll continue to build upon each advancing our products, deepening our customer partnerships and driving outcomes that improve healthcare for all. Now, looking ahead, our operational priorities are clear and focused. First, delivering excellence in client partnership. We'll continue strengthening our customer success capabilities to engage more deeply across our clients organizations. Second, evolving our go to market model better aligning sales, marketing and customer success to accelerate cross sell momentum and drive more new logo wins. Third, modernizing our technology platform. We're building on a scalable modern tech stack to support seamless integration and new AI driven innovations. These initiatives will help us fortify our foundation, amplify our impact and position. National Research for sustained growth, strong margins and lasting value creation finally, as I mentioned in our Q2 earnings call, I've been engaged in building up our management team. I'm pleased to welcome Shane Harrison as our new CFO. Shane joined NRC last month, bringing more than 25 years of experience in finance, strategy, M and A and investor relations at leading SaaS and technology companies, including most recently at PowerSchool. I'm excited about the leadership team we're building and confident in the opportunities ahead. With that, I'll turn it over to Shane to share what drew him to NRC and to walk through the details of our financial performance.

Thank you Trent and good afternoon everybody. I'm thrilled to be here today and to be part of National Research Health. I've always been drawn to mission driven companies that are trying to change the way people live and how they can thrive. National Research's focus on delivering meaningful insights across the full spectrum of healthcare stakeholders and using those insights to drive better outcomes is something that resonates with me. On top of this mission, National Research's subscription business model, commitment to data centric solutions, history of innovation were a great fit for me. Now onto the details of our third quarter 2025 results. For the quarter we reached $34.6 million of revenue, growing 2% sequentially. Our TRCV finished at $141.7 million, which was 8% higher than the third quarter of 2024 and has now grown sequentially for four consecutive quarters. Driving this growth is the strong sales momentum in both new logos and cross sell upsell as well as improved gross dollar retention. Adjusted EBITDA for The quarter was $10.9 million, up 11% year over year and representing a 31% margin which expanded over 4 percentage points from Q3 of 2024. Operating expenses were lower due primarily to reduced compensation expenses and the timing of marketing expenses, part of which will return in Q4 of this year. Third quarter 2025 adjusted net income was $0.23 per fully diluted share. During the quarter, we repurchased 618,000 of our shares for $9.3 million, which reduced our weighted average fully diluted share count for the third quarter to 22.1 million shares. Compared to the prior year, our weighted average diluted share count is 1.6 million shares lower, which is a reduction of 7% year over year. During the quarter we paid our normal dividend of $0.12 per share and we announced yesterday a 33% increase to our quarterly dividend to $0.16 per share, which will be payable in January. With our strong balance sheet and consistent cash flow, we remain committed to a disciplined approach to capital allocation, balancing dividends and opportunistic share repurchases with strategic investment, both organic and inorganic, that deliver compelling ROI. With that, I'll turn it back over to Trent.

Thank you Shane we're encouraged by the continued momentum across our business. Health systems are increasingly turning to National Research as their trusted partner for insights and enablement solutions, helping them better understand their patients, their employees and their communities. Our authenticity and healthcare specific focus continue to set us apart. Every product we deliver is exclusively built for healthcare, empowering our customers to improve outcomes for all their stakeholders while driving greater efficiency and effectiveness across their organizations. We remain confident in our direction and excited about the opportunity ahead to extend National Research's leadership in transforming human understanding into meaningful, measurable action. I want to thank our associates for their commitment, our customers for their trust, and our shareholders for their support. We're excited about the opportunities ahead and look forward to sharing more about our progress in the quarters to come. As a reminder, if you have any questions or want to engage further, please contact us at the email address National Research.

This concludes today's call. You may now disconnect.