- **FY25 Strong Finish**: $986M revenue, $1.54 EPS beat, 3% SCS growth, and $181M free cash flow.
- **Advisory Surge**: 25%+ FY26 growth from 4 large deals, 30+ new hires to execute projects.
- **IllumiCare Acquisition**: $100 savings per discharge, FY26 breakeven with long-term growth potential.
- **FY27 Growth Path**: Advisory scale, SCS margin recovery, and reduced TRA burden driving rebound.

**【CEO Summary Section】**
- Premier exceeded FY25 expectations with total revenue of $986M and adjusted EPS of $1.54, driven by strong performance in Supply Chain Services (SCS) and advisory business growth.
- SCS revenue grew 3% YoY, with MedSurg, pharmacy, and food categories leading. Gross administrative fees increased 3% YoY due to higher contract penetration and new member onboarding.
- Acquired IllumiCare to enhance clinical decision support, offering $100 savings per inpatient discharge and integrating with Stanson Health for AI-driven solutions.
- FY26 outlook: Total revenue $940M-$1B, adjusted EBITDA $230M-$245M, adjusted EPS $1.33-$1.43. SCS fee share expected to stabilize in high 60% range post 2026 renewals.

**【CFO Financial Commentary】**
- Q4 GAAP net income: $18M ($0.22 EPS), adjusted EBITDA: $71M (27.6% margin). Free cash flow: $181M (69% conversion), with FY26 free cash flow conversion target 70%-80%.
- SCS outperformed with $21M revenue beat, high-margin flow-through driving EBITDA. FY25 operating expenses reduced by $40M annually, partially reinvested into advisory growth.
- Completed $200M ASR, total repurchases $800M under $1B authorization. FY25 dividend yield ~4%, with focus on disciplined capital deployment.

**【Q&A Key Highlights】**
- **Advisory Momentum**: 4 large deals signed, pipeline robust. Advisory revenue expected 25%+ growth in FY26, offsetting software declines. Headcount additions (~30 new hires) to support project execution.
- **IllumiCare Impact**: $8M-$10M FY26 revenue, breakeven EBITDA. Synergies with Stanson to drive double-digit growth in clinical decision support.
- **Tariffs & Buying Behavior**: No significant pull-forward activity; stable SCS performance despite fee share headwinds.
- **FY27 Outlook**: Growth resumption driven by advisory scale, SCS margin expansion, and reduced TRA payments (no $100M annual impact post FY25).

Premier, Inc. (PINC) Q4 2025 Earnings Call Transcript

- **Q3 Revenue Beat**: $261 million with 3.5% YTD growth in SCS gross admin fees, driven by new contracts and member expansion.
- **AI and Strategic Partnerships**: Epic partnership to launch clinical tools, enhancing tech-driven performance improvement.
- **Tariff Mitigation Success**: No supply chain disruptions; member-led contracting and data tools buffer against tariff risks.
- **Financial Strength**: $73 million adjusted EBITDA (28.4% margin), $130 million free cash flow, and $200 million share buybacks.
- **Performance Services Revival**: New leadership and solutions drive sequential growth, with consulting bookings up.

**【CEO Summary Section】**
- Premier reported Q3 2025 revenue of $261 million, exceeding expectations, with sequential growth of $21 million. Supply Chain Services (SCS) outperformed due to higher contract penetration and new member onboarding.
- CEO Mike Alkire highlighted the company's strategic focus on AI-driven solutions, including a partnership with Epic for clinical documentation tools, and a reinvigorated Performance Services segment with new leadership.
- Tariffs remain a key concern, but Premier's member-led contracting process has maintained supply chain resiliency, with no material disruptions to date.

**【CFO Financial Commentary】**
- Adjusted EBITDA reached $73 million (28.4% margin), up $21 million sequentially, driven by SCS growth and cost control.
- Free cash flow for the first nine months was $130 million, with $200 million in share repurchases completed under a $400 million program.
- Full-year guidance was updated to reflect higher adjusted EBITDA ($240-250 million) and EPS ($1.80-1.90), with SCS expected to outperform and Performance Services to rebound.

**【Q&A Key Highlights】**
- **Tariff Impact**: Health systems are using data analytics to mitigate tariff costs, with Premier's dynamic pricing models helping identify lower-cost alternatives. SCS contracts include firm-for-term pricing to shield against price hikes.
- **Performance Services Growth**: New talent and go-to-market strategies are revitalizing consulting and advisory services, with sequential revenue growth and a healthy sales pipeline.
- **Fee Share Transition**: 75% of GPO contract renewals completed, with fee share stabilizing in the high 60s. SCS gross administrative fees grew 3.5% YTD across categories like MedSurg, diagnostics, and pharmacy.
- **Capital Deployment**: Share buybacks and dividends remain priorities, with $60 million in dividends paid YTD and a 4% yield over 12 months.

Premier (PINC)-6 May 25-2025 Q3 Earnings call transcript

- **Revenue Guidance Uptick**: SCS outperformance drives $25M midpoint increase in revenue guidance, offsetting PS $25M decline.
- **AI-Driven Supply Chain Innovation**: Digital supply chain strategy wins first major partner, advancing clinical/supply chain data integration.
- **Shareholder Returns**: $600M buybacks reduce EPS dilution, with $0.08 EPS guidance increase reflecting share count reduction.
- **Tariff Mitigation**: Firm-for-term contracts shield providers from tariff impacts; global supply chain diversification underway.
- **PS Turnaround Plan**: New leadership refocusing on SaaS subscriptions, performance collaboratives, and AI use cases for growth.


**【CEO Summary Section】**
- Premier reaffirmed fiscal 2025 revenue guidance and increased adjusted EPS guidance, driven by stronger-than-expected performance in the Supply Chain Services (SCS) segment.
- SCS achieved a successful transition of its digital supply chain strategy beyond the pilot phase, signing its first major partner agreement.
- Performance Services (PS) segment faces short-term headwinds but remains confident in long-term strategy under new President David Zito.
- Emphasized AI-driven automation and data transparency to enhance healthcare supply chain efficiency.

**【CFO Financial Commentary】**
- Q2 2025 net revenue: $240 million (down YoY due to fee share renegotiations and lower PS demand).
- GAAP net loss: $46 million (impacted by $127 million goodwill impairment charge in PS).
- Adjusted EBITDA: $50 million (20.8% margin), adjusted EPS: $0.25 (in line with expectations).
- Free cash flow: $74 million (up $33 million YoY, driven by lawsuit settlement and minority investment distribution).
- Share buybacks: $600 million (29 million shares repurchased), reducing weighted average shares by 14%.

**【Q&A Key Takeaways】**
- **Tariff Preparedness**: Contracts include firm-for-term pricing protecting providers from tariffs; diversifying global supply chains to mitigate risks.
- **SCS Fee Share Progress**: 69% of GPO members renegotiated to low 60% fee share, targeting >75% completion by FY2025 and high 60s stabilization post-renewals.
- **PS Segment Recovery**: Back-end weighted FY2025 growth expected, with Applied Sciences pipeline strength and SaaS subscription model adoption.
- **Balance Sheet Flexibility**: $86 million cash, $100 million revolver, and $1 billion buyback authorization supporting growth initiatives.


Premier, Inc. (PINC) Q2 2025 Earnings Call Transcript

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