Weave Communications' Q2 2025: Unpacking Contradictions in CAC, Specialty Medical Growth, and Investment Strategies

Integration progress and impact on CAC, growth in specialty medical, growth expectations and investments, investment strategy and hiring, impact of macro effects are the key contradictions discussed in Weave Communications' latest 2025Q2 earnings call.



Strong Financial Performance:
- Weave Communications reported revenue of $58.5 million for Q2 2025, representing a 15.6% year-over-year growth and marking their 14th consecutive quarter of exceeding the top end of revenue guidance.
- The growth was driven by a record sales quarter, acceleration in sequential revenue added, and the rapid growth of payments revenue, which continued to outpace overall subscription revenue.

Gross Margin Improvement:
- Gross margin rose to 72.3%, an improvement from Q1.
- The improvement was attributed to disciplined execution and efficiency initiatives, despite the integration costs associated with the TrueLark acquisition.

Specialty Medical Growth and Vertical Expansion:
- Specialty medical became Weave's second-largest vertical by customer count, with under 1% share of the total specialty market.
- Growth was driven by strong performance in medical aesthetics, primary care, and physical therapy, fueled by authorized integrations with electronic medical record systems like Veradigm and Practice Fusion.

AI-driven Strategic Investments:
- Weave acquired TrueLark, an AI-powered workflow automation platform, for $25 million in cash and $10 million in equity, aiming to enhance operational efficiency and expand its product suite.
- The acquisition was driven by the potential of AI to automate up to 45% of administrative tasks in healthcare, creating capacity and supporting strategic growth priorities.