Waystar's Q2 2025 Earnings Call: Unpacking Contradictions in Revenue Models and AI Impact

Volume-based revenue and subscription growth, AI impact on business model, volume-based revenue normalization, subscription revenue growth drivers are the key contradictions discussed in Waystar's latest 2025Q2 earnings call.



Revenue and EBITDA Growth:
- Waystar reported revenue of $271 million in Q2 2025, representing 15% year-over-year growth, and an adjusted EBITDA margin of 42%.
- The growth was driven by a durable, predictable revenue model reflected in expanding the client base and high net revenue retention rates.

Impact of Rapid Client Onboarding:
- The onboarding of three large clients contributed significantly to volume-based revenue, leading to a 2% increase in year-over-year growth rate for Q2.
- This rapid onboarding was possible due to Waystar's cloud-based software platform and the clients' urgency to deploy solutions.

Subscription Revenue and Market Demand:
- Subscription revenue increased 17% year-over-year and 5% sequentially in Q2 2025.
- The strong performance in subscription revenue was attributed to the compelling demand for Waystar's solutions, particularly in provider solutions.

Iodine Software Acquisition:
- Waystar announced its agreement to acquire Iodine Software, valued at $1.25 billion, which is expected to expand its total addressable market by over 15%.
- The acquisition is seen as a strategic fit to enhance Waystar's AI capabilities and includes a vote of confidence from Iodine's largest shareholder.