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Good morning, ladies and gentlemen, and welcome to CareCloud, Inc.'s first quarter 2026 results conference call. At this time, all lines are in listen-only mode. Following the presentation, we will conduct a question-and-answer session. If at any time during this call you require immediate assistance, please press *0 for the operator. This call is being recorded Thursday, May 7, 2026. I would now like to turn the conference over to Brendan Covello, Legal Counsel. Please go ahead.

Good morning, everyone. Welcome to CareCloud's first quarter 2026 conference call. On today's call are Mahmud Haq, our Founder and Executive Chairman, Stephen Snyder, our Chief Executive Officer, A. Hadi Chaudhry, our Chief Strategy Officer, and Norman Roth, our Interim Chief Financial Officer and Corporate Controller. Before we begin, I would like to remind you that certain statements made during this call are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21 of the Securities Exchange Act of 1934, as amended. All statements other than the statements of historical fact made during this call are forward-looking statements, including, without limitation, statements regarding our expectations and guidance for future financial and operational performance, expected growth, business outlook, and potential organic growth and acquisition.

Forward-looking statements may sometimes be identified with words such as will, may, expect, plan, anticipate, approximately, upcoming, believe, estimate, or similar terminology and a negative of these terms. Forward-looking statements are not promises of or guarantees of future performance and are subject to a variety of risks and uncertainties, many of which are beyond our control, which could cause actual results to differ materially from those contemplated in these forward-looking statements. These statements reflect our opinions only as to the date of this presentation, and we undertake no obligation to revise these forward-looking statements in light of new information or future events. Please refer to our press release and our reports filed with the Securities and Exchange Commission, where you will find a more comprehensive discussion of our performance and factors that could cause actual results to differ materially from these forward-looking statements.

For anyone who dialed into the call by telephone, you may want to download our first quarter 2026 earnings presentation. Please visit our investor relations site, ir.carecloud.com. Click on News and Events, click IR Calendar. Click on First Quarter 2026 Results Conference Call, download the earnings presentation. Finally, on today's call, we may refer to certain non-GAAP financial measures. Please refer to today's press release announcing our first quarter 2026 results for a reconciliation of these non-GAAP performance measures to our GAAP financial results. With that said, I'll now turn the call over to our CEO, Stephen Snyder. Stephen?

Thanks, Brendan. Good morning, everyone. I'm pleased to report that the first quarter of 2026 marked a strong start to the year for CareCloud. With revenue growth of 13%, the broadest product portfolio in our history, accelerating commercial traction in our AI platform, and a transformational simplification of our capital structure that we executed shortly after quarter's end. We delivered the kind of momentum we expected entering 2026. We are reaffirming our full-year guidance with great confidence. Let me start with our top-line numbers. For the first quarter of 2026, we generated revenue of $31.3 million, up 13% from $27.6 million in Q1 of last year.

On profitability, GAAP operating income was $1 million for the quarter, and GAAP net income was $900,000, as anticipated, both lower than the prior year's quarter, driven primarily by increased amortization of acquired intangible assets and integration costs associated with the Medsphere acquisition. Adjusted EBITDA, adjusted net income, and adjusted EPS were each essentially in line with the prior year, and we generated $2.4 million in free cash flow. These non-GAAP measures are the cleaner read on our underlying operating performance, and they show a business that is holding margin while we absorb a material acquisition. Norm will walk you through this in more detail in a few minutes. Next, I'd like to spend some time on our capital structure because what we executed in April represents the most significant simplification of CareCloud's balance sheet since our IPO.

On April 13th, we closed a new $50 million credit facility with Citizens Bank and Provident Bank, comprised of a $40 million term loan and a $10 million revolving line, which replaced our previous $10 million Provident Bank facility. In parallel, we also put an at-the-market or an ATM equity facility in place, not as a financing we plan to lean on, but as a flexible just-in-time tool we can deploy on opportunistic terms if and when it makes sense for our shareholders. The day after closing, on April 14th, our board elected to redeem 100% of our outstanding Series B preferred stock. The redemption is scheduled for May 15th, and we have already pre-funded approximately $41.6 million of the new credit facility to satisfy it. Let me underline what this means in plain terms.

Together with the conversion of approximately 80% of the Series A preferred stock that we completed in March of last year, the full redemption of our Series B preferred stock effectively removes the preferred equity overhang that has shaped our capital structure for many years. We are exchanging high-cost preferred dividends for lower cost senior debt, dramatically simplifying our story for investors, and we are doing it with zero common shareholder dilution from the redemption itself. This is more than a balance sheet exercise. A simpler capital structure broadens our investor universe, particularly among institutional investors who have historically been deterred by complex preferred equity stacks, improving the visibility of common shareholder economics, and that lowers our weighted average cost of capital. In short, the structure of the company now aligns with the way we run it: as a focused, profitable, growing healthcare IT technology platform.

Turning to our acquisition portfolio, the integration of the transactions we completed in 2025 is progressing well. Through Medsphere, we entered the inpatient hospital market and significantly expanded our addressable market, adding the number one Black Book ranked Wellsoft emergency department information system, the CareVue inpatient EHR, ChartLogic for surgical specialties, Marketware for physician relationship management, HealthLine for hospital supply chain, and managed IT services. That portfolio took us from ambulatory first to care continuum. On MAP App, our HFMA partnership is opening hospital finance conversations that would have taken years to build organically. Hadi will walk you through how we're layering AI-driven recommendations on top of MAP App's benchmarking foundation. The strategic point is quite simple. MAP App identifies where a hospital is underperforming, and our RCM and AI capabilities demonstrate how to fix it.

That is a powerful combination. 2026 is the year where we believe we'll scale it. As to our AI platform, it is really no longer a vision. It is a product line in the market with paying customers and measurable results. stratusAI Desk Agent, our agentic AI phone receptionist, reached full commercial release in December and is scaling. Across early adopters, the platform is now handling approximately 75% of inbound calls automatically, freeing front desk staff to focus on more complex patient needs and lifting the throughput of every practice that deploys it. Our AI Center of Excellence, launched in April of last year, is fully operational and is the engine behind everything in our AI portfolio. In a moment, Hadi will walk you through the 3-track framework we use to apply AI across the business.

Inside our own operations, embedded in the products our clients already use every day, and as a standalone AI solution. Where each track stands today. The point I want to leave you with is that the believed addressable market for our AI front desk capability alone exceeds $4 billion in the U.S., and we are bringing it to the large provider customer base that already trusts CareCloud with its core clinical and revenue cycle workflows. That integration advantage is hard to replicate. Our 2026 growth strategy is unchanged and fully on track. First, we are actively cross-selling stratusAI and our RCM services to our existing ambulatory client base. Second, we are penetrating the Medsphere installed base of hospital and health system customers with our RCM and AI capabilities, creating a multiplier effect on sales efficiency. Accordingly, we are reaffirming our 2026 guidance.

We continue to expect revenue of $128 million-$132 million, adjusted EBITDA of $29 million-$31 million, and GAAP earnings per share of $0.20-$0.23, which would represent more than a 100% increase over our 2025 EPS of $0.10. Our confidence in this outlook is grounded on our continued growth in our RCM business, accelerating AI revenue contribution from stratusAI, and the synergy of cross-sell opportunities from our 2025 acquisitions, each of which we expect to ramp meaningfully through the back half of the year. A brief word on operational efficiency. We are also deploying AI inside our own back office and consolidating overlapping systems from our 2025 acquisitions, and we expect that work to be an ongoing source of margin improvement through 2026 and into 2027.

Hadi will go deeper on this as the first of his three AI tracks. Stepping back, this is exactly the kind of quarter we wanted to deliver to start 2026. Revenue grew by 13%. Our AI platform is in market and scaling. Our acquisition portfolio is contributing as planned. Our integration work on Medsphere is well underway. We have used the early weeks of the second quarter to fundamentally simplify our capital structure, closing a new credit facility, putting an ATM in place, and announcing the full redemption of our Series B preferred stock. The underlying business, recurring revenue, cash generation, the customer base, the product roadmap is moving in the right direction. We are reaffirming our 2026 guidance. We are entering the rest of the year with more capability, more scale, and more momentum than at any point in our history.

We are a profitable growing company with a clear AI strategy and the operational discipline to execute on it. I look forward to sharing our progress with you throughout the year. With that, I'll turn the call over to Hadi Chaudhry, our Chief Strategy Officer, who will provide more details on our AI strategy and product roadmap. Hadi.

Thank you, Steve, and good morning, everyone. Before I get into first quarter, I want to remind everyone of the framework we are using to apply AI across CareCloud, because everything I'm about to walk you through fits inside that framework. I think it's the clearest way to understand both what we are doing today and what compounds over time. As Steve mentioned, we are pursuing AI along three parallel tracks. The first is back-end cost and efficiency optimization, where AI applied inside our own RCM financial and administrative operations to do the work we already do for our clients, but faster, more accurately, and at a much lower cost. The economic outcome shows up in the margins. The second is embedding AI into our existing customer-facing applications, our EHR, practice management, patient engagement, and benchmarking platforms.

Bringing AI inside the products our clients already use makes them smarter, stickier, more valuable without asking clients to buy something new. The outcome shows up in retention, expansion, and the strength of our existing revenue base. The third is building entirely new AI products for discrete high-value problems in healthcare operations. stratusAI Desk Agent and cirrusAI Notes are the two most visible examples today. With AI prior authorization, AI-assisted medical coding, and additional clinical documentation capabilities in active development. The outcome is new revenue lines as those products mature. These three tracks are not separate strategies competing for resources. They are the same investment compounding three different ways. Let me walk you through where each one stands at the end of Q1. On the back-end track, we continued in Q1 to apply AI across our own RCM financial and administrative operations.

This is the track that gets the least external attention, but it is where AI is creating its most measurable near-term impact. Inside our RCM operations, AI is reducing claim errors, improving documentation accuracy, and increasing first-pass acceptance rates with payers. Across our administrative and financial functions, it is helping our internal teams handle higher volumes with the same headcount. We are also adopting AI-driven tools across the software development life cycle, such as code generation, code review, QA and testing, and application design. This is the same productivity revolution the broader software industry is going through, and we are participating in it as a deliberate strategy. Over time, we expect two compounding outcomes: higher code quality and meaningfully more output per engineer. For a company shipping across a wide product surface, EHR, RCM, practice management, patient engagement, benchmarking, and an expanding AI portfolio, that engineering leverage matters.

How we measure progress on this track matters. We are not just tracking lag indicators. Outcomes like acceptance rates and denial ratios that tell you what already has happened. We are actively monitoring lead indicators, the signals that predict revenue cycle performance before it shows up in the financials. How early errors are caught, how many claims are pre-validated before submission, how much human intervention is required for a claim, and how effectively our AI predicts denials so that rules can be configured proactively, not reactively. These upstream metrics are where AI creates its leverage, and they are what give us confidence in where the trajectory is heading, not just where it has been.

Our longer-term ambition is to set a new industry benchmark, zero touch claims, a fully automated workflow where AI handles intake, validation, submission, and follow-up with minimal human intervention, allowing billing teams to focus on exceptions rather than routine processing. Q1 was a quarter of measurable progress on the underlying lead indicators that bring that vision closer. The second track is bringing AI into the products our clients already use every day. Our existing suite, EHR practice management, patient engagement, benchmarking, represents thousands of touch points per client per day. Every one is an opportunity to make our software more intelligent without asking the client to buy something new. This creates more lasting AI value than launching a new product because it improves everything already deployed with customers.

In Q1, we continued deepening AI inside these platforms, improving how our EHR surfaces relevant information at the point of care, making our practice management system more predictive about scheduling and intake, and enhancing the analytical depth of our benchmarking capabilities. None of this is a new product announcement. It is continuous embedded improvement to platforms our clients are already paying for. The most successful version of this track is one where AI inside the product is invisible to the user. They simply find that the software is doing more for them than it used to. We will share specific results as they become meaningful to disclose. This track is also where leverage on our acquisitions pays out. Some of the platforms we brought in through Medsphere and the MAP App serve a different client segment than our ambulatory base. Hospital systems, health networks, and emergency departments.

The AI work there is in earlier stages, but the principle is the same. The platforms get more value when AI is part of them, and that value accrues to clients already on them. That is leverage we paid for, and we are working through it methodically. The third track is the one that gets the most public attention. New standalone AI products for specific high-value workflows. This is where Stratus AI Front Desk Agent and cirrusAI Notes live and where our development pipeline continues to expand. Let me start with Stratus AI Front Desk Agent, our agentic AI front desk solution. We continue to sign new business in Q1 almost entirely from within our existing client base, exactly the motion we wanted at this stage. Our priority right now is not maximizing contract sign.

It is making sure every agent we sign is implemented well, completes its trial successfully, and earns the right to expand inside this account. Expansion means more agents per client, additional functions, extended coverage hours, and broader use cases. This is the curve we are deliberately working, depth before breadth, because it produces durable standing revenue rather than a flurry of signed contracts that don't convert into real usage. Within the desk agent suite, stratusAI Voice Audit continues to play an important complementary role, giving practice administrators visibility into both AI-handled and staff-handled calls. Some clients adopt Voice Audit alongside stratusAI Desk Agent from day one. Others bring it on later as their AI deployment matures. Either way, it deepens our broader stratusAI footprint inside the account.

Turning to cirrusAI Notes, our ambient documentation product, Notes continues to be an entry point for many providers into the cirrusAI family on ambulatory side, where it serves the most acute pain point in clinician's day. What I want to highlight this quarter is the integration efforts underway to bring cirrusAI Notes into the inpatient platforms we acquired through Medsphere, opening the door to AI-assisted documentation inside hospitals and health systems. A different clinical workflow, user, and buying center that ambulatory market we have served historically. This is exactly the cross-pollination between our acquisitions and our AI portfolio that we described as the multiplier effect when we closed Medsphere. Beyond front desk agent and notes, our pipeline continues to advance.

AI prior authorization, AI-assisted medical coding, and additional clinical documentation capabilities are all in active development inside the AI Center of Excellence, and bringing those to market is a goal for this year. We will share more on each as they get closer to client readiness. Let me close by coming back to the three-track framework because I think this is where the strategic picture comes together. A company pursuing only the third track, only new AI products, is making a bet that depends entirely on those products achieving scale. A company pursuing only the first track, only internal cost optimization, captures margin but doesn't differentiate its products. A company pursuing only the second track, only embedding AI into existing apps, strengthens retention but doesn't create new revenue lines. CareCloud is doing all three at once, and the reason that matters is that each track de-risks the other.

Internal AI improves our economics regardless of how fast the new AI products scale. Embedded AI strengthens our existing revenue base regardless of how fast we capture new markets. New AI products give us a path to entirely new revenue lines built on top of an installed base that AI is already making stronger every day. Q1 was a quarter where each of those three tracks moved forward. Each one continued to compound in the direction we have been describing, and together they form the durable, profitable AI strategy we are executing. With that, I will turn it over to Norm to walk you through the financials. Norm?

Thanks, Hadi. Thanks everyone for joining our call today. As you've just heard, we had another strong quarter and are moving forward with our plans for the remainder of the year. In particular, we are continuing to generate sufficient amounts of free cash flow, and in May, we'll liquidate all of the outstanding Series B preferred shares. Revenue for the first quarter of 2026 was $31.3 million, compared to $27.6 million for the first quarter of 2025. Recurring technology-enabled business solution revenue was $23 million during the first quarter of 2026, up approximately $5.3 million from the first quarter of 2025, while the non-recurring project-based professional services revenue from Medsphere decreased approximately $2.9 million.

First quarter 2026 GAAP net income was $922,000 as compared to net income of $1.9 million in the same period last year. This is our eighth consecutive quarter of positive GAAP net income. Although our revenue has increased, we are continuing to integrate the Medsphere acquisition and eliminating duplicative costs. As a result of the 2025 acquisitions, there was also an increase in the amortization of intangibles and transitional costs impacting net income. We generated $2.4 million of free cash flow for the first quarter of this year, compared to $3.6 million last year. Again, the decrease resulted primarily from the Medsphere integration.

Adjusted EBITDA for the first quarter of 2026 was $5.4 million or 17% of revenue compared to $5.6 million in the same period last year. Adjusted net income was $2.2 million or $0.05 per share compared to $2.3 million in the same period last year, calculated using the end of period common shares outstanding. As of March 31, 2026, the company had approximately $3.9 million of cash and net working capital was $2.6 million, both of which have slightly improved since year-end. We are fortunate that we have not been affected by any of the tariffs that were instituted or are contemplated since tariffs are being applied to physical goods, not services.

Even better, the revenue of doctor's practices, our customers, should not be significantly affected by the tariffs or the uncertainty of potential recessions or inflation. We don't anticipate the pressure of reduced demand for our services. The conflicts in the Middle East and Ukraine have also not impacted us. Our financial position remains strong as the company continues to take a disciplined approach to spending, ensuring our investments are aligned with clear returns. We are encouraged by the progress we've made and remain focused on executing through the remainder of the year. We look forward to reporting strong results for the remainder of 2026. With that, I'll now turn the call over to our chairman, Mahmud, for his closing remarks. Mahmud?

Thank you, Norm. CareCloud is a profitable, growing company. The full redemption of our Series B preferred and last year's Series A conversion mark a major step towards a simpler capital structure and a stronger story for our investors. We are also focused on leading the industry transformation, and our AI strategy positions us well for what's ahead. Thank you to our employees, clients, and shareholders for their continued support. Operator, please open the line for questions.

We will now begin the question and answer session. If you wish to ask a question, please press star and one on your telephone keypad and wait for your name to be announced. Once again, star and one if you wish to ask a question. We will now take our first question. This comes from the line of Allen Klee from Maxim Group. Your line is now open. Please go ahead.

Hello, good morning. To start with, in the in-house like patient software segment, talk a little about your traction. It seems like you have a good strategy there, but this seems like this could be a big driver for the future. If you could maybe just highlight kind of what you're focused on strategically.

Good morning, Allen Klee. Norm, thanks for joining. That's a great question, and I think I'll use this as an opportunity to dive into a little bit details about what our roadmap or the strategy is when it comes to the Medsphere products. As you know, this acquisition brought us a comprehensive suite of platforms across the inpatient and hospital ecosystem. As an example, Wellsoft and CareVue for inpatient EHR, Marketware for physician relationship management, and HealthLine for hospital supply chain. Across all 4, we are executing on a deliberate value creation strategy with 4 parallel work streams. First 1 is, if you think about the technical debt remediation and modernization. As Medsphere had paused most enhancement activity going into the acquisition.

The foundational catch-up has been substantial. Wellsoft, CareVue, they are being modernized from thick client desktop application to fully cloud-based SaaS platforms. To put one number on it, just if you think about on the RCM side only, we are closing more than 50 carry-forward items this quarter to bring desktop and cloud to functional, to functional parity. Similar work is running in parallel across the entire portfolio. Our second one is the net new capability development. Moving these platforms well beyond where we acquired them. Marketware alone, more than 20 new features are in active development this quarter, including a flagship integration with PracticeMatch. That's the leading physician talent network that automates candidate data transfer and streamline recruiter workflows.

On the supply chain side, we have already delivered web-based mobility for warehouse workflows, and we are building expiration and implant log tracking as an example. Third is our cross-portfolio integration with the existing CareCloud Suite. Wellsoft is being integrated with Breeze, our patient experience platform, which will bring a seamless patient engagement layer into the emergency department. We are also connecting Wellsoft to CareCloud's RCM infrastructure to extend RCM capabilities into urgent care. The fourth one is our AI infusion. The clearest example is integration of stratusAI into Wellsoft emergency department workflows. We're in clinical documentation and care setting that has historically been an underserved AI innovation as we believe.

We are also embedding AI into Marketware to surface intelligent candidate recommendation, turning it from a relationship management tool into a AI-powered recruitment engine. In addition to that, there's a lot of other things from the ONC from the compliance standpoint, ONC cure certification, SOC 2, type 2 for EPCS migrations and the like. Our focus at the moment is just making sure we go through these 4 tracks simultaneously. We already the teams have started to reach out to the customers where we can bring the value in and start cross-selling and upselling activity.

sorry for the long answer, but I just want to take this opportunity to give you the our strategy and the roadmap for the entire acquisition of Medsphere platforms.

That, that was great. Thank you. In terms of some of your new AI products like stratusAI Voice Audit and cirrusAI Notes, can you just give us a sense of how customers have been, any feedback you've been getting?

Right. First of all, there has been no lack of interest at all from the customers. We are getting a lot of traction. We continue to close the new business from the existing client base in the throughout the first quarter. As you know, our strategy has been the first after the signing of the contract, they will be going through an initial implementation. There is a 30 days trial. Many times the customers say just because of the first AI adoption resistance, you would say, or, "Okay, we'll only implement refill agent," as an example.

We go through those one by one, and as I mentioned in our, in my remarks earlier, our goal today is that every single customer and the agent is implemented, complete the trial successfully, and start growing beyond, just the trial and keep adding and activating more agents. To answer your question, we are getting a lot of traction. There are no issues in terms of finding the interest and closing the contracts. We are right now laser focused on implementation and expansion.

Thank you. My last question now is, you showed your pipeline of AI prior authorization, AI-assisted medical coding, and additional clinical documentation. How do you think about what the opportunity is here?

Well, for both of those, just to give a little more detail for, as an example, for medical coding, we already have started to deploy internally because as you know, we provide the medical coding to many, many clients today. Internally, we have and that will be used as a proof point in maturing and refining the product, to achieve the right accuracy levels. Then we can start expanding and start selling into the other client base where we are not doing the coding as an example today. Also, this also helps us refine further our Stratus AI Notes application because our long-term vision is it should be a one cohesive starting from this notes. The coding should be done automatically right off of there.

These pieces will eventually be integrated into that entire workflow or the stream. Same case goal for the prior authorizations, since we also, in addition to the AI-based development on our side, we also need to complete our integration with external clearing houses and the payers, so we can submit those authorizations electronically. We have completed significant milestones in terms of completing the testing in the testing environment. We are in the initial phase of picking up the pilot customers to deploy this AI authorization.

If you think about both of these two things and authorization as an example, I don't have the industry numbers in front of me at the moment, but this is one of the most one of the pain points, especially in this healthcare industry for specialties such as orthopedics, for neurosurgery, where you really need these authorizations to be done accurately, on time, before the procedure is done. In the hospital space from the Medsphere, we see a tremendous opportunity there once these products get materialized.

That's great. I'll get back in the queue. Thank you so much.

Thank you.

Yes, sir. Thank you. The next question comes from Lisa Thompson from Zacks Investment Research. Your line is now open. Please go ahead and ask your question.

Good morning. I have a few questions for you. First off, I would like to, for you to discuss the Series B redemption. I know it's a good thing, and you enumerated some things that were positive. Could you talk about the timing? Why now?

For sure. Thanks for the question, Lisa. As you mentioned, this probably is the single biggest capital structure simplification in our history, at least as a public company. The Series B redemption removes a preferred equity overhang that has existed since shortly after IPO. It's a good question, like why now? Why is now the right time to make sure that we remove that overhang? At least from our perspective, there are three main reasons. First is from an operating performance and free cash flow. We've really reached an inflection point. We're generating the cash to support a senior debt-funded redemption. We have the capacity, we have the capability to do that, do it. That's one.

Second would be from a credit market perspective, we're able to secure an attractive senior debt facility with attractive economics for the $50 million facility. So the ability to move forward with very attractive senior debt economics was another key driver. The third thing was the fact that we're eliminating the preferred dividend burden. That really frees us up from a cash flow perspective to redirect the capital to growth investment, M&A, and common shareholders. From a strategic perspective, there's been a longstanding complexity in our equity story that really is driven by the preferred. It's something that we've heard in the majority of the conversations we have with institutional investors.

We really believe that this transformation allows us, with zero dilution, to create an investment in the common shares that's far more attractive for a broader base of investors. For a variety of reasons, we thought the time is now. We're excited about being able to move forward with that redemption. Of course, the official redemption will occur later this month on the fifteenth.

Okay, great. As far as the ATM goes, you said that you would be using it when appropriate. Could you give us some examples of when that might be appropriate?

Sure. So think about the ATM Visa as really simply a tool that gives us optionality, not as a plan. Our default posture has always been, will continue to be a very conservative posture. We've intentionally refrained from issuing new common equity opportunistically, and we'll continue to do that. It's not a general financing source. When would we consider it? We'd really consider it in a few different circumstances. One, we would consider it to fund attractive, creative M&A transactions where the strategic value is moving quickly and we can do so without dilution. That would be one, to be able to fund M&A transactions. A second would be, if the stock price is trading at a level, where we're able to opportunistically de-risk the balance sheet, we'd consider it then.

Then maybe a final point would be, more so to support clear growth objectives, so investments with a defined return profile. Those would be really the three main reasons why we would use it. Again, I think it's important to remember that, again, our posture has been very conservative, will continue to be very conservative. We'll only use the proceeds when there's a clearly accretive acquisition or one of these other criteria is met.

Okay, great. That makes sense. I was wondering if you could just talk about, where you are with AI versus competitors. Are there other people out there with the same capabilities? In that respect, what functionality is AI giving you that's most helpful for the sales force when they're going out versus the competition?

Absolutely. I'll let Hadi dive into that a little bit more. The common theme that we hear is that AI incorporated into the fully integrated system, which includes EHR, the practice management system, and patient health experience, that AI that's embedded within that ecosystem or that environment is really what unlocks the utility, the usefulness of AI. Really where we've been focusing from a sales perspective has been on things like stratusAI, where there's a very clear picture from a healthcare provider's perspective in terms of the return on that investment. They're able to see a very clear path towards return on that investment and to free up their internal resources to focus on higher value activities.

Really stratusAI, I think, exemplifies one of the key areas where our healthcare providers are increasingly appreciating the value of AI and are embracing it. I'll let Hadi address that more broadly.

Sure. As Steve mentioned, Lisa, there is no shortage of point solution AI vendors. They are targeting individual workflows in healthcare. As an example, you might find very many med vendors who are providing the ambient solutions. Other, you will find vendors who are providing something similar to what we are with our stratusAI front desk assistant or agent as an example. What really differentiate us is, it's a full embedded integrated solution versus a bolt-on solution, which most of these vendors are providing. As a whole overall AI strategy is a three-pronged approach, back-end optimization to the embedding the AI into the existing platform, as Steve was saying.

The third one is the various, whether it's the `stratusAI`, whether it's the ambient solution of our `stratusAI` voice application and the like. Those are the ones from the net new revenue perspective, we are the sales team is focusing on.

Great. Thank you. That's all my questions.

Thank you.

Yes, thank you. We have a follow-up question from Allen Klee from Maxim Group. Your line is now open. Please go ahead.

Yes, hi. You stated that you're reaffirming your full-year guidance, and the first quarter is seasonally always the lowest quarter, and you had the integration-related items during the quarter. I thought it was important how you said that margins you expect to improve throughout the year. Could you comment a little on how you think about how that progresses and any seasonality? Thank you.

For sure. Thanks, Allen. I'll let Norman jump in. To your point, quarter one is always a seasonally weak quarter for us because of deductibles and other factors. That not only compresses our overall top line, but also from a profitability perspective, you see the impact associated with that reduced revenue. I'll let Norman talk about it in a little bit more detail.

Sure thing. Thank you, Steve. Thanks, Alan. We bought the Medsphere, you know, corporation in August of 2023. Even in the first quarter, we were eliminating some duplicative costs. There was some transitional costs and then integration costs. We're trying to get through those, you know, sometimes duplicative personnel. Also, you can see in our purchase price allocation, a significant amount of intangible assets that are amortized. We amortize them on a double declining balance, so that amortization is gonna decrease over time. As we, you know, digest the acquisition, remove the, you know, duplicative costs and get past the transitional costs, we would expect margins to improve.

Thank you.

Allen, maybe one other thing to think about Sorry, Allen, I'm just gonna mention, one other thing to think about, in terms of margins for the year is as we progress through the year, especially as we get into the back half of the year, you'll see those margins continue to grow. If you just think about the, kinda the typical average month, we believe that free cash flow will exceed $2 million on average, during any given month. If you kinda counterbalance that against our obligations, the obligations associated with the loan, will result in payment obligations of about $1.1 million. From a cash flow perspective, we have that cash to continue to reinvest in attractive M&A opportunities.

We have the cash to continue to invest in other growth opportunities and the like. Even from an ATM perspective, that's why we truly say that ATM is really a tool to give us optionality down the road, really not a plan. You may recall we went public at $5 per share. There'd really have to be a very compelling reason to sell shares at less than that. Doesn't mean it's impossible, but there'd have to be a very compelling thesis to sell shares at something lower than $5. That's because we're generating this cash flow internally. If you think about the acquisitions last year, we closed 4 total acquisitions. Those acquisitions were paid with 0 common shares.

I mean, 0 dilution and paid from our internally generated cash flow. We continue to see really that being the proper path for us as we move forward.

That's great. Is it available, any of the terms on the new, the credit facility?

Yes, Allen. We filed an 8-K, and in there is all the exhibits, you know, as required in the 8-K, so you can see all the related documents.

Great. Thank you. Maybe the last thing, You guys had a history of, like, you could buy things with a better customer acquisition cost than doing it organically. Now it seems like you have the opportunity on both sides. In terms of, like, having a sales force to go after the opportunities you have, how are you approaching that?

From a sales force perspective, our sales force today is multiple times what it was at the same time last year. I would say it's grown probably 3 times compared to what it was last year at the same time. That sales team is focused on cross-selling within our existing base. As our existing base continues to grow through the Medsphere acquisition and through organic growth and through the other acquisitions, then the overall size and scope of that cross-selling campaign continues to increase. That team is really primarily focused on sales activities that are oriented towards expanding the wallet share within our existing base. It, I think that will continue to be the case.

I think what we have now is now we have really two prongs from the growth strategy perspective that we're comfortable with. One prong being the organic growth and the other prong being the acquisitive growth or the inorganic growth. From a cost perspective, you'll recall that the acquisitive growth for us generally is somewhere between 0.6x and 1x revenue, the cost of acquiring portfolios of customers, recurring revenue relationships in the context of these acquisitions. In our space, of course, the industry average is somewhere between 1.2x-1.4x revenue for that same cost of acquiring that customer relationship. We're attempting to do that at a lower cost. Again, you'll appreciate the fact that we're relatively early in terms of this overall expansion.

The jury is still out, quite candidly, in terms of whether we can do that at a comparable CAC to our acquisitive growth. That's what we're endeavoring to do. We have the capital to push forward and to give that a, you know, a full try, and which is what we're doing. With the capacity, with the capital to be able to invest in that two-prong strategy, that's what we're doing. We believe that the results will bear out the wisdom of that overall approach. Again, time will tell.

Okay. That's the lot. Thank you. Thank you so much.

Certainly.

Thank you. Yes, sir. Thank you. There are no further questions that came through at this time. I'll now turn the call over back to Norman Roth for any closing remarks. Please go ahead, sir.

Yes. Thank you everyone for attending our call today. Hope you have a great day.

Thank you.

Thank you. This concludes our conference call for today. Thank you all for participating. You may now disconnect.

Greetings. Welcome to CareCloud, Inc. Fourth Quarter 2025 Results Conference Call. [Operator Instructions] Please note, this conference is being recorded. I will now turn the conference over to Brendan Covello, Corporate Counsel. Please begin.

Good morning, everyone. Welcome to CareCloud's Fourth Quarter and Full Year 2025 Conference Call. On today's call are Mahmud Haq, our Founder and Executive Chairman; Stephen Snyder, our Chief Executive Officer; A. Hadi Chaudhry, our Chief Strategy Officer; and Norman Roth, our Interim Chief Financial Officer and Corporate Controller. Before we begin, I would like to remind you that certain statements made during this call are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 as amended and Section 21 of the Securities Exchange Act of 1934 as amended. All statements other than the statements of historical fact made during this call are forward-looking statements, including, without limitation, statements regarding our expectations and guidance for future financial and operational performance, expected growth, business outlook and potential organic growth and acquisitions. Forward-looking statements may sometimes be identified with words such as will, may, expect, plan, anticipate, approximately, upcoming, believe, estimate or similar terminology and the negative of these terms. Forward-looking statements are not promises or guarantees of future performance and are subject to a variety of risks and uncertainties, many of which are beyond our control, which could cause actual results to differ materially from those contemplated in these forward-looking statements. These statements reflect our opinions only as to the date of this presentation, and we undertake no obligation to revise these forward-looking statements in light of new information or future events. Please refer to our press release and other reports filed with the Securities and Exchange Commission, where you will find a more comprehensive discussion of our performance and factors that could cause actual results to differ materially from those forward-looking statements. For anyone who dialed in the call by telephone, you may want to download our fourth quarter and full year 2025 earnings presentation. Please visit our Investor Relations site, ir.carecloud.com. Click on News and Events, then click IR Calendar, click on Fourth Quarter and Full Year 2025 Results Conference Call and download the earnings presentation. Finally, on today's call, we may refer to certain non-GAAP financial measures. Please refer to today's press release announcing our fourth quarter and full year results for a reconciliation of these non-GAAP performance measures to our GAAP financial results. With that said, I'll now turn the call over to our CEO, Stephen Snyder. Stephen?

Thanks, Brendan, and good morning, everyone. I'm pleased to report that 2025 was a transformational year for CareCloud, marked by exceptional financial performance, strategic acquisitions that expanded our market reach and a successful launch of our flagship AI platform. We delivered results that underscore the strength of our business model and validate our vision for the company's future. In particular, I'm pleased to be able to talk today about our revenue growth, the remarkable acceleration of our profitability and free cash flow, the current status of our capital structure, the significance of our 2025 acquisitions, the evolution of our services offering and AI platform, our market position and growth drivers as we enter 2026 and our guidance for the year ahead. First, let me start with our top line numbers. For the full year 2025, we generated revenue of $120.5 million, representing nearly 9% year-over-year growth. In Q4 specifically, we achieved revenue of $34.4 million, up nearly 22% year-over-year, demonstrating accelerating momentum as we entered this year. Importantly, we raised our revenue guidance twice during 2025 and still exceeded the final target, a pattern that reflects the underlying health and predictability of our recurring revenue streams. Second, as to profitability, we reported GAAP net income of $10.8 million for 2025, a year-over-year increase of more than 37%. We achieved earnings per share of $0.10, marking our first full year of positive EPS since our 2014 IPO, a remarkable milestone that reflects our multiyear transformation to sustainable profitability. In Q4 alone, we posted GAAP earnings per share of $0.04. Adjusted EBITDA expanded to $27.5 million with a 23% margin, up more than 14% year-over-year. But perhaps most importantly, we generated $28.6 million in GAAP operating cash flow for the full year, a 38% increase year-over-year and $8.7 million in Q4 alone, up 66%. Non-GAAP free cash flow reached approximately $20.5 million for 2025 compared to $13.2 million in 2024 and representing growth of more than 500% from 2023. This dramatic improvement in free cash flow generation has been transformational to our financial flexibility and strategic optionality. It enabled us to resume dividends on our preferred shares at the beginning of 2025 to begin paying double dividends on our Series B preferred stock starting in 2026 to address the accumulated arrearages and to fund multiple acquisitions during 2025, entirely from free cash flow generated during that year. Third, as to our capital structure, during 2025, we completed the conversion of approximately 80% of our Series A preferred shares into common. The conversion eliminated more than $7 million in annual dividend obligations, and we fully repaid our Provident Bank credit line by year-end, entering 2026 with 0 drawn on our credit line. Reducing the complexity of our capital structure remains a core priority. Fourth, we made significant strides during 2025 on the M&A front. We completed multiple transactions during the year, each strategically selected to expand our capabilities and market reach. These deals were all executed at less than 1x revenue multiples, funded entirely through the free cash flow we generated during 2025 and resulted in 0 common shareholder dilution. The most significant of these was our August acquisition of Medsphere Systems, which brought us into the inpatient hospital market. Through Medsphere, we added a suite of ambulatory and inpatient software products, including the #1 Black Book ranked Wellsoft emergency information department system. This was a watershed moment for CareCloud. We evolved from an ambulatory first to a care continuum company, able to support the full patient and clinician journey from outpatient clinic to emergency department to inpatient bed through the revenue cycle and into the supply chain. Integration is well underway. We are incorporating our AI tools into the platform, and we are already seeing new customer wins under the CareCloud umbrella. We also acquired MAP App from the Healthcare Financial Management Association, or HFMA, in October of last year, alongside a long-term joint marketing agreement. MAP App is a hospital benchmarking and performance analytics platform used by leading hospitals and integrated delivery networks to measure and compare revenue cycle metrics. MAP App identifies where a hospital is underperforming and CareCloud's RCM and AI provide the solution, a sales motion with built-in urgency and quantifiable ROI that we intend to scale in 2026 and beyond. Through Medsphere and MAP App, we now serve hospital systems and health networks, creating a natural cross-selling runway for our AI solutions and RCM services. Our 2026 growth strategy centers on penetrating these newly acquired health system customers with our RCM and AI products, exactly the kind of operating leverage that justifies these strategic investments. Fifth, we have continued to position ourselves as an emerging leader in health care IT. We recognize that the health care technology market is at an inflection point. AI adoption is moving from pilot programs to production deployment and providers are actively seeking partners who can integrate AI across their clinical and administrative workflows. We are operating in a market with a multibillion-dollar addressable opportunity in the U.S. alone for our AI front desk assistant and that is just one application in our broader AI framework. We launched stratusAI Front Desk Agent in December 2025 and are already seeing strong early traction. Hadi will provide more details on our AI products and road map. But from a business perspective, our combination of domain expertise, distribution and clinical data gives us a competitive moat that is extraordinarily difficult to replicate. Sixth, let me turn to our market position and growth drivers. In 2026, we will continue to leverage our dual platform footprint in ambulatory and inpatient markets to drive organic growth and acquisition synergies. Our primary growth vectors, ambulatory cross-selling, deeper hospital penetration of existing relationships and AI monetization represent a compounding opportunity that positions us for durable growth. As we have noted in prior calls, strategic acquisitions have been a cornerstone of our growth historically, and 2025 marked the year where we reignited that momentum after a multiyear pause during which we refreshed our financial foundation, achieved sustainable profitability and launched our AI Center of Excellence. We were patient because we wanted to acquire from a position of strength, and that patience has paid off. All of our 2025 acquisitions follow the same disciplined playbook, acquisition purchases non-dilutive to common shareholders, structured to maintain balance sheet flexibility and priced at attractive valuations of 1x revenue or less. What is particularly exciting now is that AI is further accelerating our acquisition opportunity set. We expect to remain active in the M&A front in 2026 and beyond as we identify complementary targets that extend our reach and can benefit from our AI capabilities. Seventh, turning to our guidance for 2026. It reflects continued growth with accelerating profitability. We expect revenue of $128 million to $130 million and adjusted EBITDA of $29 million to $31 million, reflecting margin expansion. We further expect GAAP EPS of $0.20 to $0.23 per share, which would represent an increase of more than 100% over 2025. We have set this guidance at levels that we believe are achievable and consistent with our track record, we intend to execute against it with discipline. As we reflect on 2025, we are humbled by the progress we have made across every dimension of our business. We exceeded previously raised revenue guidance. We delivered our first year of positive EPS as a public company. We generated exceptional free cash flow growth, increasing more than 500% over the last 3 years. We executed strategic acquisitions without diluting shareholders. We launched a transformational AI platform that is already gaining market traction, and we strengthened our market position through acquisition-driven diversification. Together, they represent a fundamental repositioning of CareCloud as a full continuum health care technology platform with AI at its core. We believe these achievements position us to deliver sustained value creation for our shareholders, clients and employees. We are entering 2026 with more momentum, more scale and a stronger balance sheet than at any point in time in our history, and we look forward to achieving our objectives in 2026 and beyond. With that, I'll turn the call over to Hadi Chaudhry, our Chief Strategy Officer, who will provide more details on our acquisition strategy and product road map. Hadi?

Thank you, Steve. Good morning, everyone, and thank you for joining today. Steve has walked you through an outstanding financial year. That performance gives us the platform to do something really important, invest aggressively and deliberately in AI. My job today is to take you inside that effort, what we have built, what's working and where we are taking it in 2026. In April 2025, we launched CareCloud's AI Center of Excellence, a fully operational production-grade initiative with one mandate, build AI solutions that create measurable impact for health care providers. This is not a research lab or a pilot program. It is the engine behind everything in our AI portfolio. We built this capability in-house because AI and health care cannot be generic. It must be trained on the right data, integrated into real clinical and administrative workflows and designed around health care-specific compliance and accuracy. The AI Center of Excellence brings together engineering, data science, clinical informatics and product development to deliver exactly that. Let me walk you through what we have launched. Our flagship AI product of 2025 is stratusAI Front Desk Agent, which reached full commercial release in December. It is an agentic AI phone receptionist, fully autonomous, operating 24 hours a day, 7 days a week, ending patient calls with natural human-like conversation. The scope of what it manages is significant, appointment scheduling, rescheduling and cancellations, real-time insurance eligibility verification and demographic capture, prescription refill routing, lab results, inquiries, referral requests and automated confirmations and reminders. When a call requires human judgment, it escalates intelligently to a live staff member. The system is deeply integrated within our EHR and practice management platforms, which means there is no manual data reentry and no third-party middleware between the AI and the patient record. Our results speak for themselves. Dr. Holden, owner of the Lung Center shared that stratus Desk Agent is now handling nearly 80% of their inbound scheduling-related calls, freeing his staff to focus on more complex patient needs. There is a fundamental shift in how our practice operates, and it is exactly the outcome we designed this product to deliver. Alongside Desk Agent, we have stratusAI Voice Audit, our conversational intelligence platform, gives practice administrators and hospital operations leaders visibility into every patient phone interaction, whether handled by AI or by the staff member. Voice Audit delivers call monitoring, quality scoring, trend analysis and patient sentiment insights. It shows what's working, where workflows are breaking down and where there are opportunities to improve the patient experience. Beyond patient access, we are applying AI deeply across revenue cycle management, the core of our business. AI capabilities are already active throughout our RCM operations, helping reduce claim errors, improve appeals and documentation accuracy and increase first pass acceptance rates with payers. Importantly, AI also allows us to shift from relying primarily on lagging indicators such as denial rates and days in account receivable to monitoring leading indicators earlier in the revenue cycle. By identifying potential issues at intake, eligibility verification, coding and claim creation, we can prevent problems before a claim is ever submitted rather than reacting after a denial occurs. Our longer-term ambition is to establish a new industry benchmark, zero-touch claims, a fully automated workflow where AI manages intake, validation, submission and payer follow-up with minimal human intervention. This enables billing teams to focus their expertise on true exceptions rather than routine processing. We are also developing AI-driven prior authorization capabilities, which represents one of the most significant administrative bottlenecks in the health care today. Prior auth delays drive revenue leakage, delay patient care and consume enormous staff time. Our approach is to use AI to predict authorization requirements, pre-populate supporting documentation and route requests automatically, reducing turnaround time and the rate of initial denials. We are also actively developing an AI-assisted medical coding product. Accurate coding is foundational to revenue cycle performance. Errors at that stage cascade into denials, delays and lost reimbursement. For clients using CirrusAI Notes, the 2 products work in concert, taking a clinical encounter seamlessly from documentation through accurate coding assignment. On the clinical side, CirrusAI Notes addresses documentation burden, a primary driver of physician burnout. It captures the clinical encounter and generates structured notes for physicians to review and sign off on rather than author from scratch. It is live and in use today, and it earns clinician trust precisely because it does not try to replace physician judgment, it removes the administrative burden around it. I want to spend a moment on the intersection of our acquisition strategy and our AI capabilities because I think this is one of the most compelling and underappreciated aspects of our story. Each platform in the Medsphere portfolio is embedded in real clinical operations, serving workflows previously outside CareCloud's reach, and none of them had a dedicated AI team behind them until now. Clients across this portfolio will also benefit from access to CareCloud's ambulatory AI-enabled solutions as our integration work progresses, bringing the full capability of our platform to bear across the care continuum. Our AI Center of Excellence is actively scoping AI enhancements across this portfolio, prioritizing the highest impact use cases in supply chain efficiency, emergency department workflow and clinical documentation. As those enhancements are completed and validated, they will be made available to the clients. To be clear about sequencing, the new clients we are winning today are selecting these platforms on the strength of what they deliver right now. Our contract win with Memorial Hospital in Ohio, deploying HealthLine for supply chain management is a strong signal of that underlying demand. As our AI capabilities for HealthLine mature, Memorial and clients like them will position to adopt these enhancements when they are ready. The same logic applies to Wellsoft. In January, Affinity Urgent Care in the Houston Galveston area selected Wellsoft, bringing our emergency grade documentation system into the urgent care settings for the first time. With approximately 11,000 urgent care facilities across the United States, this channel represents a meaningful expansion of our addressable market. The AI layer for Wellsoft is in development. And when it is ready, it will strengthen our competitive position in the channel considerably. On the AI side, MAP App becomes more powerful over time. Our road map adds recommendations that go beyond identifying a revenue cycle gap to quantifying its dollar impact and surfacing the automation that closes is fastest, moving us from analytics to action, a conversation hospital CFOs are very receptive to. The HFMA relationship also gives us distribution into hospital finance leadership that would take years to build organically. And combined with our AI road map for MAP App, we have compelling reasons to be in those conversations in 2026. Looking ahead, I want to be direct about what 2026 means for our AI strategy. We have spent 2025 building the AI Center of Excellence, the stratusAI product suite, the acquisitions that expand our platform. 2026 is the year we execute. Let me walk you through our priorities. First, we will continue expanding our AI product suite across the full platform. StratusAI Desk Agent and Voice Audit are live and scaling. CirrusAI Notes is deployed and being integrated across the Medsphere suite. AI-assisted coding and prior authorization AI are both targeted for release this year. Second, we will execute on the cross-sell opportunity at the product level. Steve outlined the strategic case Medsphere relationships, RCM capabilities, HFMA partnership. My focus is making sure the AI product are ready to support that motion. CirrusAI Notes integrated into MedSphere suite, the coding product available to hospital billing teams and stratusAI Desk Agent deployable in hospital patient access centers. Third, we will continue building the AI Center of Excellence, deepening our clinical data sets, developing proprietary models trained on health care-specific workflows and partnering selectively with AI leading infrastructure providers where it helps us move faster. The principle is always the same. Health care native AI built with right guardrails delivers better and more defensible outcomes than generic AI applied to health care settings. Fourth and most importantly, we will hold ourselves accountable to client outcomes, not just product releases. The measure of AI investment is not feature ship. It is revenue improvements, denial rate reductions, time saved per provider, patient satisfaction scores. Those are the metrics we track internally, and they are the ones we will be sharing with you as our AI business matures. I want to close with the thought on why this moment is meaningful. Providers across every care settings are seeking purpose-built AI that integrates into the systems they already use. This is precisely what we are building across ambulatory, emergency, inpatient and hospital billing operations. CareCloud sits at a rare intersection, long-standing relationships with over 45,000 providers across the care continuum, a fully integrated platform spanning EHR, practice management, RCM and our supply chain and hospital systems and a dedicated AI organization focused entirely on solving health care operational problems. We are profitable, growing company with a clear AI strategy and operational discipline to execute it. I look forward to sharing our progress with you throughout the year. With that, I will turn the call over to Norm Roth, our Interim CFO and Corporate Controller, who will walk you through the detailed financial results. Norm?

Thank you, Hadi, and thanks, everyone, for joining our call today. As you have just heard, we had another strong quarter and a strong finish to the year. We have accomplished and exceeded the goals we set for ourselves for 2025. In particular, we are now generating record levels of free cash flow and resumed paying dividends on our preferred shares, which started in February 2025, and we've also been catching up on the dividend arrearage for the Series B preferred stock. Further, we have fully repaid our Provident Bank line of credit at the end of the year, we had borrowed funds for the Medsphere acquisition and now have the full $10 million line of credit available. We generated $20.5 million of free cash flow in 2025, which we measure as cash from operations less purchases of property and equipment and capitalized software and other intangible assets. In 2025, we began seeking out acquisition opportunities and during the year, we completed 4 acquisitions. We continue to evaluate acquisition opportunities that will be accretive to the company. The key to growing our free cash flow continues to be reducing expenses and growing our GAAP net income. Fourth quarter 2025 GAAP net income was $2.9 million as compared to $3.3 million in the same period last year. This is our seventh consecutive quarter achieving positive GAAP net income. Revenue for the fourth quarter 2025 was $34.4 million compared to $28.2 million for the fourth quarter of 2024. There was approximately $7.2 million in revenue related to the Medsphere acquisition in the fourth quarter. Adjusted EBITDA for the fourth quarter 2025 was $7.7 million or 22% of revenue compared to $7.1 million in the same period last year. This was an increase of 8% year-over-year. For the full year, the story is similar. With our emphasis on improving profitability, revenue for the year 2025 was $120.5 million compared to $110.8 million in 2024. Our GAAP operating income was $11.3 million compared to $9.1 million in the same period last year and our GAAP net income was $10.8 million compared to a GAAP net income of $7.9 million for 2024. This was the highest GAAP net income for the company since inception. Non-GAAP adjusted net income was $14.4 million or $0.34 per share, calculated using the end-of-period common shares outstanding. Since going public, this is the first year we have had positive full year GAAP EPS. For the year 2025, adjusted EBITDA was $27.5 million, an increase of 15% or $3.4 million from $24.1 million last year. Our adjusted EBITDA for full year 2025 was also the highest amount ever achieved by the company. During the year 2025, we generated $28.6 million of cash from operations compared to $20.6 million in the prior year and $20.5 million of free cash flow as defined. The free cash flow amount of $20.5 million increased by 55% compared to $13.2 million in the same period last year. As of December 31, 2025, the company had approximately $3.6 million of cash. Net working capital was approximately $1.3 million. Now that we have repaid our line of credit, free cash flow during 2026 will allow us to increase our cash balance and build additional cushion in our net working capital. Our financial position continued to improve during the year 2025. We are happy to report strong financial results, no amounts outstanding on our line of credit, cash savings from the Series A preferred stock conversion that occurred in March 2025 and look forward to continuing to report strong results next year. With that, I'll now turn the call over to Mahmud for his closing remarks. Mahmud?

Thank you, Norm. 2025 was a milestone year for CareCloud. We delivered strong profitability and free cash flow, expanded into the hospital market through strategic acquisitions and launched an AI platform that positions us well for the future. What is most exciting is that we are just getting started. We enter 2026 with strong momentum, a stronger balance sheet and significant opportunities to drive growth across our platform. I want to thank our employees, clients and shareholders for their continued trust and support. We remain focused on disciplined execution, innovation and creating long-term value for all of our stakeholders. Operator, please open the line for questions.

[Operator Instructions] Our first question is from Allen Klee with Maxim Group.

Great quarter. So when I'm listening to your talk, the 2 big themes I'm hearing among others, are your emphasis on AI and acquisitions and how you can combine them and get benefits. So could you expand a little more on how you're planning on kind of monetizing the AI in 2026? You've talked about, but I think it's important.

For sure. Thanks for the question, Allen. So if we step back for those who haven't followed our story so closely, and we'll just talk about M&A first and then we'll dig a little bit deeper into the AI question specifically that you asked. So first of all, from an M&A perspective, the environment today continues to be increasingly favorable. AI is a catalyst for smaller billing companies and for health care companies that focus on delivering software products to the inpatient, also the ambulatory space because they recognize the fact that without AI, their competitive position continues to weaken in the market. So that's driving more sellers into our pipeline than ever before. Our strategy continues to be one of patience and discipline like we've followed for years. So we wait for an opportunity where the recurring revenue associated with, first of all, it has to be recurring revenue relationships, a portfolio of recurring relationships, revenue relationships. And then secondly, from a valuation perspective, we really target valuations of between 0.6 and 1x revenue. That compares very favorably to the CAC in our space, which is typically about 1.5x or greater revenue. So we move forward with these acquisitions. And then with regard to that, those base companies that are part of that portfolio, we aim to bring them from a status of typically breakeven or operating at a loss to about 25% to 30% profitability margins typically within about 9 months. So that's the base strategy. You've asked about the AI overlay to that, and that's where I think the whole strategy gets even more interesting. So if we think about the -- just as an example, if we think about the Medsphere acquisition, we've purchased software products that lack that AI capability. And what our team has been doing is that it's been really focused in on taking the core AI products, taking the CirrusAI product, the stratusAI product, taking the AI Notes applications and the like and then weaving that and incorporating that fully into those platforms. And we expect to have that done within the next couple of quarters. So we're able to take those platforms and to make them increasingly more attractive and platforms that as opposed to being -- as opposed to lagging behind where the space is, will be increasingly leading in their particular markets. So we see some exciting potential there. The second thing would be if we think about this from the perspective of revenue cycle companies, we now are increasingly using AI and automation to handle a lot of the services that before were being handled by individuals here in the U.S. or members of our team globally. So AI and automation is increasingly assisting with the back-office processing enabling us to further drive margins. And Hadi might have something else to add to that from an AI perspective.

Sure. Thank you, Steve. Just to add on to what Steve has mentioned, our strategy from the AI perspective has been the same and threefolds. One, continue to focus on the improvement and implementation of AI in the back-end operations, whether it's the basic denial management, whether it's the automation of, as an example, the referrals and verification of the benefits and the like, and then there are many others. And the second is the AI enablement or AI integration into the existing -- the product suite that we have, whether it's our own EHR practice management platform or these other companies, as Steve mentioned that we are acquiring, the team continues to focus on building the AI layer to make it more attractive and more marketable. And then continue to focus on any other net new applications that we can bring to the market such as the stratusAI FDA.

That's very helpful. Then it was encouraging to see like contract wins with new customers. Could you talk a little about how you think -- what was behind the win and how you think that's an opportunity going forward?

Allen, if we think about our overall sales team and our marketing team, we've expanded that team by 2 or 3x. So we have an increased team that's focused -- increased science team that's focused on cross-selling and also these net new opportunities. Having said that, we continue to see the real opportunities this year being primarily in expanding the wallet share of those existing customers, many of whom we've acquired more recently through the Medsphere and the MAP App transactions. So through those transactions, we've acquired more than 100 new hospitals and health systems who we're working with. And we see significant opportunity to sell more deeply into these existing clients by providing additional services and solutions, AI products, RCM solutions with a real focus on stratusAI and CirrusAI that can add value, and we believe will resonate with this market. So yes, 100%, we've had some new wins. We talked about a new Wellsoft win. Wellsoft is our recently #1 Black Book ranked EHR that's focused on the emergency departments. So we had a win there. And we also had a win with regard to our supply chain product as well. So we have those new wins, but we really think that the real opportunity will be continuing to cross-sell and upsell the existing customers.

Okay. You also -- my last question, and then I'll jump back in. The front-end AI, you mentioned -- I think you said you launched that in December. How do you think about -- and you said it's a very large opportunity, in terms of how you're targeting that and early indications you get of interest? Any comments there?

For sure. Yes. Allen, you're talking about our stratusAI product. And again, the market opportunity is estimated to be $4 billion plus. And Hadi can provide a little bit more visibility with regard to the early response, but we've really been encouraged by how well that's resonated with regards to our existing base. Our sales efforts are almost exclusively focused on our existing base, and we're getting significant traction there. But over to Hadi.

Thank you. To your point, Steve, so we are seeing a very encouraging early adoption since the launch in -- the commercial launch in December. While we are not disclosing a specific client count at this stage, but our deployment pipeline is really robust across existing ambulatory client base. And we yet need to tap into aggressively into the Medsphere client base that our team has aggressively working towards integrating across the product suite there. So at the moment, we have seen an exceptional interest from our existing client base. So we expect to share more specific adoption metrics as we progress through 2026.

Our next question is from Michael Kim with Zacks Small-Cap Research.

So first, there continues to be a lot of uncertainty in the markets as it relates to AI and the potential impacts on SaaS companies. So just wondering how investors should think about CareCloud's exposure to AI disruption versus maybe being more of an AI beneficiary?

Thanks, Michael. And you're 100% right. The SaaS sell-off in the market has been significant and has not discriminated. It has not discriminated between companies where there really is a more significant risk than those where there isn't. We believe that the companies that are most at risk are the horizontal per seat tools for generic workflows, things like scheduling apps, basic CRM, things like -- companies like that where AI agents can replicate and fully replace that key functionality. That's really fundamentally though, not our business. And I would focus in particular in the health care space. So health care IT, in particular, has very deep industry moats that those horizontal SaaS players simply don't have. So our AI products, as an example, require rigorous testing, certification, approval by a government-approved entity with regard to -- prior to their initial launch and with regard to any fundamental changes we make to them. So the ability to -- for these new market entrances from AI companies is really very limited. And we also operate under HIPAA and a whole web of other health care-specific regulations that create substantial barriers to entry. We're also the system of record for our providers from a clinical, financial administrative perspective. And that data all lives within our existing platform. And if we think about more fundamentally, what our clients in the context of leveraging us accomplish really is in large part, shifting their risk to us. They rely upon us to securely host their data to ensure compliance, to most fundamentally produce revenue for the practice. So our SaaS offering isn't simply a stand-alone tool. It's really the technology backbone that drives our larger revenue cycle management services, which are fully integrated with it. And clients pay us based on the actual value we're producing because the overall majority of our clients pay us a percentage of the practice collections for both the EHR, the technology piece and also the RCM offering. So it's fundamentally different from many of those other companies that are really feeling -- also feeling this impact. I would say one other thing is we also have more than 25 years of proprietary data across hundreds of millions of claims. And that really -- that information and that data informs our AI products, helps us ensure coding accuracy, manage denial management, benchmarking and the like, all things that new entrants in the market don't have. So at least as we look at it, Michael, our thought is that with our valuation being 5x, 6x EBITDA, in spite of the fact we're generating, we generated this last year $20.5 million of free cash flow, we really trade -- we continue to trade at a fraction of the valuations of the market in general and candidly, even a fraction of the valuation of other health care IT peers or more than twice that. So as the market moves away from this more indiscriminate treatment of all companies that are working on some level with AI and we'll move from that to, we believe, a more differentiated approach between those companies that are truly threatened by AI and those for whom AI is actually a key part of their advantage, is a key part of their ability to add additional value to the existing relationships. And we really fall into that second camp.

Got it. Makes a lot of sense. And then second, clearly, earnings power and free cash flow continue to build. So just wondering what sort of assumptions you're building in as it relates to the 2026 guidance ranges and then how you think about sort of the trajectory of growth looking out beyond next year?

So to your point, Michael, for us, 2025 was a milestone year. It was our first positive -- our first year of producing positive EPS since we went public back in 2014. And we've had 7 straight quarters of GAAP profitability and free cash flow alone was up 55% as compared to 2024 up to $20.5 million in 2025. So if we think about just our EPS guidance this year of $0.20 to $0.23, that represents more than 100% growth, and we feel very confident about that guidance. Now what's driving that overall growth? It's really being driven in large part by the top line growth. And in addition to that, the integration savings with regard to the companies we've acquired and then really driven largely also by the AI efficiencies. And then add to that the fact that we've eliminated through the conversion in 2025, we've eliminated more than $7.5 million of preferred dividend obligations on an annualized basis. So the increased free cash flow really gives us flexibility to be able to fund M&A for operations. And if you just look at this most recent year, we were able to acquire all 4 companies purely from the cash flow generated during 2025 with 0 dilution to the common shareholders, also able to invest in our AI development and then fully resume payments relative to our Series A and Series B shareholders. And in addition to that, if you think about this year, in addition to all those things, we're also paying double dividends to clear up the arrearage relative to the Series B. So from a funding perspective, operations is really continuing to drive this flexibility and continues to open up new opportunities for us. And as we think even more broadly beyond 2026 and 2027, we believe that we'll continue to fundamentally expand the overall margin profile as we continue to scale.

Our next question is from Michael Galantino with Chaplin Davis.

Great year, great quarter. Way to finish the year strong. I've been involved with the company for a little over 9 years, and you guys have seen a lot -- we've all seen a lot of changes in the industry. I mean, nobody knew what AI was 9 years ago, and now it's the focus of the company. You guys have done a tremendous job navigating it specifically the last 2 or 3 years. I have a couple of questions. Steve, one to you on the AI front. Does the AI technology and the efforts of the company, does it save money in terms of operationally? And does it increase the margins? And I know you talked about the SaaS stocks that have been coming under -- or the software stocks that have come under significant pressure in the last 3 or 4 months, if you can address that? And the second question is, now that you have excess cash flow -- a lot of excess cash flow, which is a great problem to have, what are the focuses for the use of that money if there are no opportunities to make any more acquisitions this year?

Thanks, Mike. I appreciate your questions. So maybe I'll try to address the first one initially. And if you just -- if we think just -- if we kind of back up for a minute and think more fundamentally about the overall revenue of the company, and we go back to, let's say, the fourth quarter of 2024, and we think about our company on an annualized basis. On an annualized basis, we were at, let's say, $110 million roughly. We think about where we are today, probably $125 million. These are all very rough numbers. So we've increased the overall revenue base by about 14%, 15% roughly. And we've done all that while actually reducing the number of employees that we have today as compared to 2024. So I think that really more fundamentally, at least on a qualitative level, speaks to what we're able to do, and that's in large part driven by AI and automation. And as the year progresses, I believe you'll continue to see us being able to do far more with far less. So that -- those savings and that margin, we believe, will continue to increase as we move forward. And again, in the whole scheme of things, we're probably in the first inning. So this is really just beginning. We just launched our AI Center of Excellence less than a year ago. So these realities, the long-term realities are yet to be fully seen in the financials. But again, based upon the numbers as we see them today, we think there's significant opportunity for us to be able to reduce overall expenses associated with the revenue as we continue to grow it. The second thing is with regard to the use of that free cash flow. We continue to look for these opportunities to be able to put that capital to work with regard to these acquisitions. So acquisitions in our space, again, with a focus on being able to acquire companies from our internally generated cash flow ideally. So that would be one key focus. The second key focus would be continuing to -- as the opportunities present themselves and as our profit margins continue to grow to look for opportunities to be able to continue to enhance our overall capital structure as time progresses. That would be another opportunity that we look forward to pursuing and also continuing to invest in AI, continuing to look for opportunities to expand the existing capacity of our software products and to continue to handle an increasingly larger and larger share of the responsibilities that our clients are handling today.

Just a quick follow-up. When you guys are competing for this business, who is your competition? Who's out there bidding on the same business that CareCloud is right now? Are there much larger firms? Are they smaller start-ups? Or who is our direct competition for this business?

Good question, Mike. I think to answer that, we probably would have to break that into a couple of different areas. So from an EHR perspective, we're oftentimes competing against companies like eClinicalWorks, AdvancedMD and other similar players really focused on being on the ambulatory space. So those would be 2 of the main companies plus athenahealth would be a third company where there's a greater mix and more of a focus on the integrated solution that involves the delivery both of software and also of the revenue cycle management services. From an AI perspective, the playing field is wider, and it really then depends again on the products. So for instance, our CirrusAI product, that product that's more focused, for instance, on the -- using the audio and the ambient sound from the communications between the provider and the patient in the exam room to really populate the chart, many of our competitors in this space are offering very similar solutions. Some of those solutions are native. Other solutions are through a third-party application and integrate into their platform. From the perspective, though, of the product that Hadi was talking about before, many of our competitors actually aren't offering that solution. But kind of one company maybe to think about would be SoundHound. So SoundHound has a product that is actually very similar in many respects called Amelia, and Amelia has a lot of that same functionality. But SoundHound, unlike us, does not have a vertical -- does not have a vertical approach. They're an outside player selling horizontally into this space. So they don't have their own EHR, for instance, in which they can incorporate this product. But SoundHound is also interesting because if we look at their overall valuation, it's about 20x today, 20x the EV. So compare and contrast that with ours, and we think there's a lot of opportunity for investors once the market really understands that we have a proof of concept and we are able to demonstrate real success at rolling out our solution to our existing customer base.

Our final question is a follow-up from Allen Klee with Maxim Group.

Yes. Just on the financials quick thing. In terms of your outlook, any comments on thoughts of CapEx and capitalized software spending? And your guidance overall, does it include any unannounced acquisitions?

Great question. I'll let Norm handle the first part of that, but the answer to your second part of your question is no. It does not include any unannounced material acquisitions.

And I think, Allen, you're looking at CapEx and software, I think if you look at the levels from this year, I think they'd be the same or maybe a little less. So if you wanted to use that as your forecast.

Okay. Maybe just following up in terms of the run rate on operating expenses, to what extent -- I know you're increasing R&D, but do you still anticipate utilizing AI can get you some benefits on the expense side?

Absolutely. We do. We do. And candidly, as we sit here today as compared to a year ago, we believe we can accomplish everything that we're setting up to accomplish in terms of AI, and we can accomplish it with a smaller team than we had initially envisioned. There's been so much progress from an AI perspective in terms of the key models that we use to -- as the girding in our overall framework that we really believe that we can increasingly achieve what we're setting out to achieve from an AI perspective with a leaner team than we had initially envisioned. So I think there'll be less spending from the perspective of the AI Center of Excellence. And beyond that, the spend that -- the investments that we're making today will really continue to make us more efficient and continue to expand margins.

With no further questions, I would like to turn the conference back over to Norman for closing remarks.

Thank you, everyone, for attending our call today. Have a great day.

Thank you. This will conclude today's conference. You may disconnect at this time, and thank you for your participation.