Greetings, and welcome to Weave's Fourth Quarter and Full Year 2025 Financial Results and Conference Call. [Operator Instructions] As a reminder, this conference is being recorded. [Operator Instructions] I would now like to turn the conference over to your host, Moriah Shilton, Investor Relations. Thank you. You may begin.

Thank you, Kevin. Good afternoon, everyone, and welcome to Weave's Fourth Quarter and Full Year 2025 Financial Results Conference Call. With me on today's call are Brett White, CEO; and Jason Christiansen, CFO. During the course of this conference call, we will make forward-looking statements regarding the anticipated performance of our business. These forward-looking statements are based on management's current views and expectations, entail certain assumptions made as of today's date and are subject to various risks and uncertainties described in our SEC filings. We've disclaims any obligation to update or revise any forward-looking statements. Further, on today's call, we will also discuss certain non-GAAP metrics that we believe aid in the understanding of our financial results. Unless otherwise noted, all numbers we talk about today will be on a non-GAAP basis, which excludes onetime acquisition-related costs, amortization of acquired intangible assets and stock-based compensation. A reconciliation to comparable GAAP metrics can be found in today's earnings release, which is available on our Investor Relations website and as an exhibit to the Form 8-K furnished with the SEC before this call as well as the earnings presentation on our Investor Relations website. Before I turn the call over to Brett, we want to let you know that we'll be participating in the Raymond James Institutional Investors Conference on March 2 at the JW Marriott in Orlando, Florida. And with that, I will now turn the call over to Brett.

Thank you, Moriah, and thank you to everyone joining us today. We've delivered another strong quarter in Q4 with 17% year-over-year revenue growth, gross margin expanding to a company record of 73.3% and operating income increasing to $2.3 million, our highest level, both in dollars and as a percentage of revenue. This marks the 16th consecutive quarter of meeting or exceeding the high end of our revenue guidance range. For the full year, we generated 17% revenue growth and 24% growth in free cash flow. These results demonstrate the strength of our model, consistent top line growth, expanding margins and disciplined cash generation while continuing to advance the platform for our customers. We're proving we can scale profitably and deliver new capabilities that deepen Weave's value to the practice. At our core, we serve the professionals who care for patients. Our customers provide care at every stage of life from the first pediatric visits to restorative procedures, chronic care management and everything in between. They are trusted professionals delivering essential services in their communities. Health care is fundamentally human. AI will not replace providers, it will amplify them. What it can do and what we are building toward is removing the administrative friction that pulls people away from patients. Our vision is simple: elevate patient experiences through a unified platform that improves business operations so health care professionals can focus on patient care. This vision is not a slogan. It guides how we build, invest and operate. The health care industry is one of the largest and most complex in the world, making it right for AI adoption, and SMB practices have historically been slow to embrace digital transformation. Health care professionals navigate increasing administrative burdens like staffing shortages, rising patient demand and reimbursement complexity. They require technology solutions to…

Thanks, Brett, and good afternoon, everyone. It was another solid quarter and a strong finish to the year for Weave, reflecting continued momentum in our growth initiatives and disciplined execution across the business. The growth in our product suite this year, including the acquisition of TrueLark, expanded our estimated total addressable market by roughly $7 billion to an estimated $22 billion. We believe there is further TAM expansion on the horizon as we add capabilities to our AI Receptionist. Across our established verticals, we see a meaningful runway for continued growth. In dental, our initial market, we are in fewer than 15% of U.S. locations, highlighting the depth of opportunities still ahead. For example, we has recently been selected and endorsed by the American Dental Association as its exclusive patient engagement solution, giving us co-marketing access to their 160,000 members and reinforcing our leadership position in the dental market. Specialty medical is our largest and newest U.S. market opportunity, and we remain in the early stages of penetration with roughly 1% share. We see a clear path to building a significantly larger business with our growing suite of AI-powered solutions, expanding market share and increasing average revenue per location. Moving to our financial results, starting with the fourth quarter, we produced $63.4 million in total revenue, which represents 17% year-over-year growth, driven by payments and the addition of new locations. Gross margin for the quarter was 73.3%, representing a year-over-year improvement of 70 basis points. We have delivered sequential gross margin expansion in 15 of the past 16 quarters, including a 30 basis point sequential improvement in Q4. Margin improvement was primarily driven by ongoing efficiencies in our cloud infrastructure and amortization of phone hardware and payment terminals as devices older than 3 years become fully amortized. We also continue…

And our first question comes from Parker Lane of Stifel.

This is Matthew Kikkert on for Parker. To start, can you talk a little bit more about the CareCredit integration that you announced this morning? Just curious if that your focus is to drive incremental payments attach rate, more average payments volumes across existing customers or something else?

Yes. Great to catch up with you, Matthew. The CareCredit partnership, what that really does is open up another avenue for us to capture volumes that otherwise would flow through CareCredit themselves. They are the largest provider of patient financing solutions in the market. And this gives us access through the partnership to some of the volumes that otherwise would flow through them. So there's work now to be done on the integration and bringing that directly to market. So today, we just announced that we completed the partnership, and we'll have more color to provide in the future.

And I would add, this is kind of just the next step in our payment strategy. So kind of starting with basic payment processing, then moving into more additional financial tools, additional financial vehicles that allow our customers to offer their patients. So it makes -- takes our payment solution to basically a financial solution and the practices have more tools to offer their patients, whether it be financing through CareCredit, financing through themselves, using the Weave tools to schedule payments. So it just makes the payment product more attractive, stickier in addition to attaching more volume.

Okay. And then secondly, for 2026, what are your expectations for growth rates across the different subverticals?

Yes. We're starting the year in a great position. We haven't broken out the growth rates for each one of the different -- the verticals that we serve. But we continue to anticipate strong growth across the growth vectors that we've talked about around specialty medical. We just talked about how Q4 was our strongest quarter from an additions perspective there. Mid-market grew nicely in 2025. We expect that to continue. And so not -- I can't speak to the underlying components, but we do anticipate to continue to see momentum and growth through those -- through the same channels.

Yes. And I would add, we expect specialty medical probably will be the strongest grower just because of the opportunity set here and all the work that we've done on adding integrations throughout this year, continue to add them throughout the year. Some of the marketing dollars that you saw that we spent in Q4 is really around developing our brand presence in that sector. So we expect that to grow, continue to be the fastest grower. I expect all of our verticals to grow nicely. The omnichannel AI Receptionist that we're rolling out is really valuable to kind of all verticals in integrated and not. I mean the tool is quite useful even without a PMS integration. So I think I expect solid growth in all verticals, but I think specialty medical will probably lead the pack.

And your next question comes from the line of Alex Sklar with Raymond James. We'll move on to our next question from Hannah Rudoff with Piper Sandler.

It was encouraging to hear that stat about the one customer, I believe you said who scheduled 1,200 appointments using your AI Receptionist. I guess longer term, as you think about it and you launch more AI capabilities and you complete the rollout of this unified inbox, how do you think about pricing to capture the value that you're delivering?

Yes. So we will definitely be able to monetize it. I think still being worked out is, is it priced as an additional module? Or is it priced as included in a bundle. So for example, you may have stand-alone TrueLark now and if you want to go to the fusion inbox where that brings everything from TrueLark and we -- all together in one place, which is the ultimate destination, is that a premium product that we price for. The really important concept, though, is that we're now going ability to attach to the labor budget because we can just prove how we save labor and how we drive revenue. So we're very confident that we can monetize the additional AI omnichannel Receptionist functionality, and I think we'll work it out over time. I think a really important point is we don't license by seat. We license by location and then consumption. And we're confident that these tools will produce a lot of value for the practices, and we'll be able to monetize them accordingly.

Totally makes sense. And then, Jason, I really appreciate the additional color you gave this quarter around NRR and the multi-location NRR you shared. I guess you've talked about churn being higher and average sales prices being lower initially in some of your newer verticals as you have newer integrations and some of the solutions are nonintegrated. I guess have you seen these metrics stabilize for some of your oldest specialty medical cohorts? Or does that take longer than a few years to kind of stabilize and average with historical metrics?

Yes. Thank you for the question. We saw the same phenomenon. I highlighted how we saw churn decrease through the second half of the year in Q4 return to 2023, '24 rates. We saw a nice improvement in specialty medical as well in Q4. And so we've already started to see some of the improvements there. We've delivered a number of integrations on that front. We've expanded our coverage on that front. And so as those have started to mature, we're encouraged about making that declaration about where churn will trend back towards because we're already starting to see some of the proof points there that we've been talking about.

Yes. And I would add, Hannah, you mentioned, does it get better over years. And it actually happens more quickly than that. We're seeing it improve over quarters. And it's just as you get your -- improve your integrations, depth, breadth, churn rates come down. And not only do churn rates come down, but CAC comes down over time as you develop a brand, you have more word of mouth, you're more familiar in the trade shows. So it's a virtuous benefit that comes over -- trends over time. And then if you say, well, how do you know that? It's just from our history, looking through all of our verticals that we enter. And that's one of the reasons we do it as a step function as opposed to just doing a shotgun blast in a lot of verticals because the idea is you go into initial vertical, ASP is lower, CAC is higher, churn is higher. You work through that, ASP comes up, CAC comes down, churn comes down and then you kind of go into a new vertical and you kind of just stage it that way. And I've been in vertical SaaS and payments for over a decade, and this is the pattern I've seen throughout that entire period.

And we will come back to Alex Sklar for your next question from Raymond James. Okay. We will move on to Mark Schappel with Loop Capital.

Can you hear me okay?

Yes, we can.

Okay. Great. Brett, starting with you, I was wondering if you could just kind of walk through your investment priorities and also hiring priorities for the coming year.

Sure. So I think they're the same, our investment priorities and our hiring priorities. So that's good. I think #1 on our hiring and investment priorities are product and engineering, where we've got a really unique advantage with -- since we own the telephony stack, we have the practice phone number, we have the data, we are really uniquely positioned to take the AI Receptionist technology from a text experience to kind of a native inside of Weave and then make it a full voice experience. And so we are really leaning hard into that, and investing against hiring engineers and product people to make sure that we can execute effectively on that one. I think other investment priorities are on the GTM side, go-to-market side. And we've actually made a couple of changes to our model at the end of this year and into next year, we're actually -- we used to go to -- we used to have a full-service AE model, and now we're kind of moving more to an SDR AE model. It's more efficient, and it seems to be working. So early proof points are good there. And I think those are the big investments we're making certainly in the first half of the year.

Okay. Great. And then as a follow-up, some of your competitors are also highlighting AI in their products. I was wondering if you could just talk a little bit about how Weave is either differentiating or plans to differentiate its AI automation capabilities from those of your competitors?

Sure. So we see lots of companies who are -- some have some products, some just put AI on their website. I think our unique -- well, I know our unique differentiators are kind of what I started with is we own the telephony stack. We've got the trusted relationships, and we own the very specific complex industry-specific workflows. We're a trusted partner of these businesses. And they really -- I meet with customers, and they'll show me all the products they have and they say, what? Which of these can Weave do, please? They really want to consolidate functionality. So the idea of saying, for example, having an AI chatbot up in one window and Weave up in another window and the PMFs in another window, it just doesn't work great. And so we have the opportunity to bring all of those workflows together. And because we have the full experience, we can retain context through the whole discussion. So you may start with a text or you may start with a call and then the call transitions to text and then the text maybe gets escalated to a specific person and the staff who can handle only -- specifically handle that question. All of that interaction, whether it's voice or text gets retained in one place. And it also gets analyzed by our Weave call intelligence, so then you can create action items, you can create tasks, you can actually perform work, whether it be issuing an invoice, filing and checking on insurance verification, booking an appointment, rescheduling an appointment. So having the deep integrations, the deep workflows, the subject matter expertise, the relationships and the ability to kind of have seamless handoff is a real, real differentiator. These highly specific workflows are hard, and you have to learn them over time. If you get an appointment wrong, so for example, someone wants a crown done and you book a 30-minute appointment for a cleaning that really hurts the practice's day. And so having that knowledge, that experience, we've got billions of these interactions, and we know kind of over time, what type of calls result in what type of outcomes, and we can optimize practice operations using that knowledge and that deep expertise.

And we will come back one more time to Alex Sklar with Raymond James.

Can you hear me now?

Yes, go ahead.

It's like third time's a charm. This is actually John on for Alex. Brett, maybe we'll start with payments here. It's great to hear about the continued strength in payments. It's been a nice growth driver for you. I'm curious, though, any comments you can share on growth differences you're seeing by end market? And then maybe how we should think about payments growth and payments attach rate in 2026 and over the medium term? And then I have a quick follow-up.

Right. So I can give you some product growth highlights, and maybe Jason can talk about sectors. So we released this year a couple of really cool new features, bulk collection, but surcharging. Surcharging has been very well received. It's a great upsell product. And that is actually driving some pretty reasonable, almost significant volume growth from the new customers who adopt it. And of course, surcharging is your ability to charge the patient for the credit card fee. And so that gets us not only a better take rate, but more importantly, it just gets us more volume. So that's in early stages, but we're seeing some very nice green shoots on that one. And I'll let Jason talk about sectors.

Yes. So some of the -- I think the best -- one of the best ways to think about payments in the sectors and how it differentiates for us is when you think about the economics of a practice, the average dentist within a practice will do about $1 million in gross billings a year. And about 50% to 60% of that will go through an insurance process. So the remaining 40%, 50% is our opportunity to go after that. So when we think about going after the performance in different sectors, what's really important is to understand what the insurance component within each one of the sectors we go after or that we sell to have and what just the nature of their economics are. And so like in specialty medical, when you're dealing with primary care, you're dealing with significantly higher insurance coverage rates. And so the payments opportunity for us in that space isn't as great as it is in like aesthetics or in veterinary. And so we try to align our go-to-market efforts with the needs of those industries and the opportunity for us to expand revenue per location through them. So that's how we think about the different specialties. And it's a contributing factor. Brett talked about how we approach the different specialties and the next verticals in a step function. we look at the overall economics of those specialties as we decide what are the next specialties or the next verticals that we open up. And it's something we consider there across all the different solutions that we offer.

That was great color there. And then, Jason, maybe just a follow-up on the NRR improvements. I know it's been touched on in earlier questions, but specifically, I do want to understand how additive do you think some of the newer products like the TrueLark and your organic product expansion can be to NRR growth in 2026 and maybe over the medium term, kind of what's embedded in the guide there?

Yes. So what's embedded within the guide, a lot of the growth from the AI receptionist follows the time line and the road map that Brett laid out in his remarks. So it biased more towards the second half just based on the time line for when those products roll to general availability. I think the opportunity for growth is really strong. From a net revenue retention perspective, we're still in the early days of selling that. The impact it will have, I guess I'm not ready to provide a lot of color on that today. There's a significant upsell opportunity, but we also know that customers have typically landed heavy whenever we bring these new capabilities, which could lead to further average revenue per location expansion without necessarily leading to significant net revenue retention expansion. And so I guess we'll -- I'd like to let the dynamics play out a little bit more as we get more sales experience there, but the opportunity is quite significant, really encouraging.

Let me just add a little bit more color to the earlier question about why we stands out as having an advantage as we move to these omnichannel AI Receptionists and there's a bunch of them out there. In addition to the things I mentioned like domain expertise, a really important one is, frankly, our scale and the fact that because we're a public company, because we have scale, we have to do it right. So when it comes to data, maintaining the data security, maintaining and ensuring that the data is used properly. compliance. We've got HIPAA, we've got PHI, we've got PCI. We've got all these rules and that we have to comply with and reliability and scalability and security and being able to support the full experience front to back. These are just a lot of things that buyers are becoming more and more concerned about, especially large groups that some of these smaller kind of newer businesses just don't have the scale or the financial ability to comply with or frankly, it's probably not as much of a focus for them. And for us, it's just absolutely table stakes.

There are no further questions at this time. I will now turn the call back to Brett White for closing remarks.

Well, thank you all for joining the call. We're super excited about 2026, and thank you again to the entire Weave team for posting an incredible 2025. Thank you.

This concludes today's call. Thank you for attending. You may now disconnect.