• Revenue Growth: 101% year-over-year increase, reaching $2 million in Q2 2024.
• Population Health Revenue: $451,000 in Q2 2024, up 276% from the previous year.
• Healthcare Workforce Revenue: $1.4 million in Q2 2024, a 66% increase year-over-year.
• Digital Health Revenue: $92,000 in Q2 2024.
• Gross Profit Margin: 17.8% in Q2 2024, up from 13.1% in Q2 2023.
• Operating Expenses: Increased to $1.7 million in Q2 2024 from $912,000 in Q2 2023.
• Net Loss: $1.4 million in Q2 2024, compared to a loss of $803,000 in Q2 2023.
• Adjusted EBITDA: Negative $1.37 million in Q2 2024, compared to negative $772,000 in Q2 2023.
• Cash Balance: $1.6 million as of June 30, 2024.

• Warning! GuruFocus has detected 2 Warning Signs with SYRA.

Release Date: August 08, 2024

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Syra Health Corp (NASDAQ:SYRA) reported a 101% year-over-year revenue growth in Q2 2024, driven by strong performance in population health, healthcare workforce, and digital health business units.
• The company expanded its gross margins by 468 basis points, attributed to higher-margin business units.
• Syra Health Corp (NASDAQ:SYRA) secured significant contracts, including a $5.8 million contract with the Indiana Family and Social Services Administration for health training and certifications.
• The company's proprietary mental health app, Syrenity, is gaining traction with two customers and additional contracts in negotiation.
• Syra Health Corp (NASDAQ:SYRA) is strategically positioned for growth in federal contracts, with involvement in high-profile projects with Caduceus and LUKE, valued at $75 billion and $43 billion respectively.

Negative Points

• The company reported a net loss of $1.4 million for Q2 2024, an increase from a loss of $803,000 in the same period last year.
• Total operating expenses increased to $1.7 million, driven by strategic investments in product development and corporate branding.
• Adjusted EBITDA for the quarter was negative $1.37 million, compared to negative $772,000 in Q2 2023.
• Salaries and benefits expenses increased by 51% year-over-year due to expanded operations and added personnel.
• Selling, general, and administrative expenses rose by 110% year-over-year, reflecting increased operational costs.

Q & A Highlights

Q: Can you provide any updates on Syrenity? A: Syrenity is our comprehensive evidence-based mental health solution featuring a conversational AI designed to deliver human-like empathy and support. It includes interventions such as educational resources and cognitive behavior therapy and integrates with Telehealth for additional treatment if necessary. Currently, two employers are using Syrenity with positive feedback. We are negotiating contracts with several private organizations and anticipate sharing more updates in the coming quarters. - Deepika Vuppalanchi, CEO

Q: Do you have any updates on the two federal contracts that you are subcontractors on? A: We are seeing positive developments with both Caduceus and LUKE on the contract vehicles with ceiling values of $75 billion and $43 billion, respectively. Our interactions with these partners remain strong, and we are well-positioned to contribute significantly. We are optimistic about receiving initial task orders in 2024. - Deepika Vuppalanchi, CEO

Q: Can you speak about the increase in G&A in the second quarter and how you see those costs decreasing going forward? A: Starting in the third quarter of 2024, we anticipate a reduction in operating expenses due to several key initiatives, including streamlining operations and optimizing our workforce. We have also implemented a 25% reduction in executive pay as part of our cost savings strategies to enhance operational efficiency. - Priya Prasad, CFO

Q: What does the contract pipeline look like and where do you expect growth in the coming quarters? A: Our private sector pipeline is expanding rapidly with strong interest in Syrenity. We are also focusing on federal contracts, either as a prime vendor or through joint ventures, and plan to replicate our successful state projects nationwide. We are targeting federal opportunities in education, public health, case management, and staffing. - Deepika Vuppalanchi, CEO

Q: How are you addressing the growing demand for your services? A: We are leveraging our successful implementation of high-profile state projects into new geographic areas, driven by our experienced team and the integration of AI technology. Our healthcare workforce business provides the cash flows necessary to invest strategically in growth areas, including scaling higher-margin, recurring revenue products like Syrenity. - Deepika Vuppalanchi, CEO

For the complete transcript of the earnings call, please refer to the full earnings call transcript.