Earnings Call Transcript - CCLD Q2 2025

Operator, Operator

Ladies and gentlemen, greetings and welcome to the CareCloud Second Quarter 2025 Results Conference Call. As a reminder, this conference is being recorded.

Unidentified Company Representative, Company Representative

Good morning, everyone. Welcome to CareCloud's Second Quarter 2025 Conference Call. On today's call are Mahmud Haq, our Founder and Executive Chairman; Co-Chief Executive Officer, Stephen Snyder; Hadi Chaudhry; 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 conference call are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements other than statements of historical fact made during this conference 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 of 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 second quarter 2025 earnings presentation. Please visit our Investor Relations site, ir.carecloud.com, click on News & Events, then click IR calendar, click on Second Quarter 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 second quarter results and 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 Co-CEO, Stephen Snyder. Stephen?

Stephen A. Snyder, Co-CEO

Thank you, Kristen, and good morning, everyone. I appreciate you joining us today for CareCloud's Second Quarter 2025 Earnings Call. I'm very pleased to report another strong quarter for CareCloud, one that reflects not just financial stability, but meaningful strategic progress across the core pillars of our business, namely AI-driven innovation, operational discipline and sustainable growth. These results are a continuation of the transformation we initiated in 2024, and they highlight our ability to execute in a dynamic and evolving healthcare environment. Let me start with the financials. We achieved GAAP net income of $2.9 million, an improvement of 73% from $1.7 million in the same period last year. And this was in spite of a modest year-over-year revenue decline, driven largely by a one-time non-recurring revenue item in Q2 2024. Importantly, this quarter marks the first time in CareCloud's history that we have delivered positive GAAP earnings per share at $0.04 compared to a loss of $0.14 per share in Q2 of 2024. This is a remarkable accomplishment and one that we're proud of. Reporting our first positive EPS as a public company, again, is a major milestone and a clear demonstration of the traction behind our strategy. Year-to-date, we've generated $4.9 million in GAAP net income, more than triple the amount we reported in the first half of 2024. Adjusted EBITDA stands at $12.1 million, a 20% increase year-over-year and free cash flow reached $9 million, up 85% over the same period. These metrics underscore the scalability and efficiency of our operating model and provide us the flexibility to reinvest in growth. Based on our performance, we are pleased to reaffirm our full-year 2025 guidance. We continue to expect revenue between $111 million and $114 million, adjusted EBITDA in the range of $26 million to $28 million and GAAP earnings per share between $0.10 and $0.13. As to tech innovation, our AI Center of Excellence is operational and is beginning to deliver measurable results while we continue to ramp up and broaden the team. We are actively using AI to enhance the provider and patient experience on the front end, while we're also applying it quietly on the back end to meaningfully improve our internal operations and cost structure. Across our back office and service delivery teams, we have deployed AI-powered automation to reduce manual work, accelerate turnaround times and eliminate redundancies. For example, we're leveraging machine learning models to streamline claims coding, readjudicate denials and prioritize accounts receivable workflows. These tools are enabling our team to more efficiently manage higher volumes with fewer resources, driving productivity gains. We're also using generative AI internally to support functions like denial management, audit preparation and revenue forecasting. In the past, these areas required intensive manual review and lengthy cross-functional coordination. Now with AI-enhanced workflows, we're able to move quickly, reduce error rates and focus our team on higher-value strategic work. Taken together, these operational efficiencies are not only expanding our margins, they're strengthening our ability to scale profitably without adding incremental costs. As we move forward, we'll continue to embed intelligence deeper into our infrastructure so we can grow faster, serve clients better and deliver stronger returns for our shareholders. We're advancing our 2025 product roadmap and gaining traction with cirrusAI Notes and cirrusAI Voice, solutions purpose-built to improve documentation accuracy, reduce provider burden and enhance the patient experience. These aren't just incremental tools. They represent the foundation of a broader platform strategy to embed intelligence into every layer of the care delivery process. We've also remained committed to financial discipline and shareholder alignment. Since resuming preferred dividend payments, we've declared 9 consecutive months of distributions, all funded entirely from our free cash flow. That consistency reflects our operational strength and capital stewardship. On the M&A front, we've returned to a more active posture. We've completed 2 acquisitions this year, each aligned with our focus on specialty AI-powered RCM. These tuck-ins reflect the kind of disciplined, accretive M&A that has historically been a core part of our growth strategy. And with a strong balance sheet and a scalable platform, we are well positioned to continue to actively evaluate additional opportunities. In summary, this quarter marks a pivotal moment for CareCloud. We are delivering profitability at scale, launching differentiated AI capabilities and reigniting our acquisition engine, all while maintaining a lean, capital-efficient model. We are executing from a position of strength and building a platform that we believe will lead the next wave of intelligent healthcare delivery. With that, I'll now turn the floor over to Hadi. Hadi?

A. Hadi Chaudhry, Co-CEO

Thank you, Steve, and thank you, everyone, for joining us. As Steve mentioned, AI is already reshaping how we operate, and I'm excited to take that conversation a level deeper. This morning, I will focus exclusively on the work we have done to bring AI from concept to execution across CareCloud. Over the past few quarters, we have gone from planning to production, embedding AI into real-world workflows that are improving efficiency, driving smarter decisions and enhancing the experience for both providers and patients. And while the momentum around our AI products continues to build, today's call marks an important inflection point, not only in how we scale those innovations, but also in how we expand our platform into entirely new market segments. I will begin with an update on AI progress. And later, I will share significant steps we have taken to bring our intelligent cloud-based platform to a critical part of a healthcare ecosystem that has long been underserved. To ensure this AI transformation, we launched our AI Center of Excellence earlier this year, and I'm pleased to share that it's now fully operational. We have hired 100 full-time AI professionals, including machine learning engineers, data scientists and NLP specialists. Alongside them, we have onboarded another 100 interns, many of whom are already being evaluated for full-time roles. This structure gives us the scale and flexibility to move quickly while continuously investing in talent and innovation. Importantly, we are taking a pragmatic and strategic approach to AI development. Where appropriate, we leverage 25 years of proprietary clinical and financial data to train purpose-built models tailored for healthcare. At the same time, we are also integrating market-available foundational models where they accelerate time to value, such as transcription summarization and conversational AI. This hybrid approach allows us to maintain control where it matters most, while benefiting from innovation across the ecosystem. The result is a growing set of production-grade solutions delivered at scale without compromising performance, security or clinical relevance. This center isn't just a hub for innovation. It's an execution engine powering the next generation of CareCloud products and capabilities. On the client side, our flagship AI solution, cirrusAI Notes and cirrusAI Voice continue to gain traction and anchor our broader intelligent platform strategy. cirrusAI Notes is a fully integrated documentation assistant that reduces provider workload and improves note quality. It uses ambient listening, smart summarization and specialty-specific logic to streamline documentation directly within the EHR. Since our last earnings call, the number of providers using cirrusAI Notes has more than doubled. We have continued to expand specialty support, refine natural language capabilities and improve real-time usability. While revenue contribution is still early, this product is delivering significant strategic value, enhancing provider satisfaction, increasing platform stickiness and differentiating our offering in an increasingly crowded EHR market. cirrusAI Voice is our AI-powered call center monitoring and auditing platform. It analyzes 100% of calls, scores each agent's performance against KPIs and uses sentiment analysis to surface coaching opportunities and quality issues in real-time. This quarter, we deployed cirrusAI Voice internally across hundreds of our employees to improve call center performance. We have also launched it with one of our enterprise clients, where it's currently undergoing performance evaluation as part of their phased rollout. Early feedback has been very encouraging. Together, cirrusAI Notes and Voice are foundational to our AI roadmap, built not as standalone tools, but as a part of a connected intelligent ecosystem, spanning both clinical and operational workflows. We are actively deploying AI to improve internal operations and scale more efficiently. In revenue cycle and denial management, machine learning and generative AI are streamlining claim coding, appeal generation and A/R prioritization, reducing manual work and accelerating turnaround times. We are also piloting AI tools for forecasting to support faster data-driven decisions. These early deployments are already delivering clear productivity gains and operational leverage. Now looking ahead to Q3, we are actively working on a broad set of AI initiatives across the organization. Among them, here are a few key projects that illustrate how we are continuing to push the boundaries of intelligent automation and patient engagement. The first one is an AI front desk agent. We are piloting a conversational AI agent capable of handling inbound calls without human intervention. It performs front office tasks like appointment scheduling, prescription refills, lab results, updates and general inquiries with a human-like voice experience. This will help reduce call volumes and improve service responsiveness. The number two, AI-enabled personal health record, a PHR. We are building an AI-powered PHR that allows patients to interact with their health data using natural language through both text and voice. A key feature is an AI voice assistant that conducts adaptive pre-visit interviews, asking context-aware questions to complete intake, assesses the patient's condition and pre-populate clinical notes, saving time for providers and improving visit quality. Additional capabilities include smart scheduling, chart summarization and proactive care prompts, all aimed at making healthcare more personalized, accessible and actionable. Number three, enhanced AI denial management. We are expanding our AI-powered denial management capabilities with deeper use of generative AI to automate appeals, classify root causes and surface payer trends, helping clients recover revenue faster and reduce future denials. These projects reflect our commitment to delivering real-world AI that improves experience, efficiency and outcomes across the care continuum. Earlier, I mentioned that today's call represents a strategic inflection point, not only in how we scale our AI innovations, but also in how we expand the reach of our platform. I'm pleased to share that as of August 1, 2025, CareCloud has received ONC Health IT certification for our talkEHR platform tailored specifically for critical access hospitals. This certification enables us to support CAH, participating in Medicare and federal quality programs and allows us to bring our technology into an underserved and critically important segment of the healthcare system. Our CAH-certified platform is cloud-based, AI-enabled and designed to support inpatient, outpatient and swing bed workflows, delivering the same operational efficiency and regulatory compliance we are known for in the ambulatory space. This milestone opens access to a $1.5 billion addressable market across more than 1,300 rural hospitals, many of which are actively seeking modern replacements for outdated high-maintenance systems. It also reinforces our broader strategy of supporting the full continuum of care from independent practices to rural inpatient facilities through a unified intelligent platform. To summarize, we are executing with focus and discipline across every layer of our AI strategy. From client-facing innovation to internal automation, we are embedding intelligence into the core of our platform, delivering measurable improvements in experience, efficiency and scalability. We have built the internal infrastructure, expanded into new markets and are actively developing next-generation capabilities that will further differentiate CareCloud in the quarters ahead. Our entry into the inpatient market reinforces our commitment to serving the full continuum of care and our conviction that AI can and should power meaningful practical improvements in how healthcare is delivered and managed. We believe we are still in the early innings of AI in healthcare, but with the foundation we have built, we are well-positioned to lead. Thank you again for your time and continued support. I will now turn the call over to our Interim CFO and Controller, Norm Roth. Norm?

Norman S. Roth, Interim CFO

Thank you, Hadi, and thanks, everyone, for joining our call today. We delivered a strong quarter, reflecting the strength of our business model and the disciplined execution of our strategic priorities. Positive earnings per share and strong cash flow underscore our continued operational efficiency and financial health. During the 6 months ended June 30, 2025, we generated $12.5 million of cash from operations and $9 million of free cash flow. We are proud of this accomplishment. In the second quarter, we reported revenues of $27.4 million, while down approximately $700,000 year-over-year, the decline was due to a one-time non-recurring revenue item in Q2 2024. CareCloud Wellness generated approximately $1 million in revenue for the quarter and approximately $1.8 million for the first 6 months of this year. Our direct operating costs continue to decline, and they are down approximately $760,000 from Q2 2024. Our operating expenses, including G&A, R&D and sales and marketing expenses decreased by approximately $1.4 million. In the second quarter, we reported positive GAAP operating income of $3 million and GAAP net income of $2.9 million. This compares to GAAP operating income of $2.3 million and GAAP net income of $1.7 million during Q2 2024. The GAAP net income per share was $0.04 based on the net income attributable to common shareholders, which takes into account the preferred stock dividends. Non-GAAP adjusted net income for the second quarter of 2025 was $3.3 million, or $0.07 per share, calculated using the end-of-period common shares outstanding. We reported adjusted EBITDA of $6.5 million in the second quarter compared to $6.4 million in the same period last year. Revenue for the first 6 months of 2025 was $55 million compared to $54.1 million for the same period in 2024. For the first 6 months of 2025, the company's GAAP net income was $4.9 million compared to a GAAP net income of $1.4 million for 2024. This equates to income of $0.02 per share after subtracting the preferred stock dividends. Non-GAAP adjusted net income for the first half of 2025 was $5.6 million, or $0.13 per share. Year-to-date, adjusted EBITDA was $12.1 million, an increase of $2 million from $10.1 million in the same period last year. As of June 30, 2025, the company had approximately $10.4 million of cash. Net working capital was approximately $14.9 million. This performance gives us confidence as we enter the second half of the year. We remain focused on profitability and cash flow and delivering long-term shareholder value. We look forward to updating you later in the year. With that, I'll now turn the call over to Mahmud for his closing remarks. Mahmud?

Mahmud U. Haq, Founder and Executive Chairman

Thank you, Norm. I want to take a moment to sincerely thank our employees, clients and shareholders for their continued trust and support. This quarter marks a significant milestone for CareCloud. Not only have we delivered our first ever positive GAAP earnings per share since our IPO, but we have done so while continuing to invest in the future. As we look ahead, we remain committed to thoughtful execution, sustainable growth and delivering long-term value for all our stakeholders. Operator, please open the line for questions.

Operator, Operator

The first question comes from Allen Klee with Maxim Group.

Allen Robert Klee, Analyst

Great quarter. Free cash flow really stood out. I wanted to discuss your AI Center of Excellence and the opportunities you are creating there. How do you view the spending in that area and how are you considering that in relation to the potential revenue-generating opportunities?

A. Hadi Chaudhry, Co-CEO

Thank you for your question, Allen. Our focus is threefold. First, we aim to introduce products to the market that can generate additional revenue. Second, we're working on enhancing our products to be more imperative and AI-enabled, which is a significant trend across the industry. For instance, in electronic health records, there are numerous ways we can optimize operations for the next generation using AI, such as summarizing charts, providing recommendations, and sorting incoming documents to suggest next steps to doctors, including preventive training options. Additionally, we're developing AI agents that can handle calls for routine inquiries like appointment scheduling and cancellations, reducing the need for human intervention. These developments can lead to incremental revenue. The third area of focus is back office optimization. We are transitioning many manual tasks to automated processes utilizing AI, which reduces our reliance on human resources and improves efficiency. The benefits will manifest in all three areas: driving revenue, making our products more competitive, and improving our margins with the aid of AI. I hope this addresses your question.

Allen Robert Klee, Analyst

Yes. You've introduced some new products and mentioned critical access hospitals along with specialized EHR. Can you discuss your approach to reaching out to new potential customers and your sales strategy for winning business with these new offerings?

A. Hadi Chaudhry, Co-CEO

Sure. Let me begin and then Steve can add in. If you consider specialties like dermatology, many of our clients are currently using CareCloud services for RCM and practice management, but they may be utilizing other EHRs that are tailored for specific specialties and have been in the field for a long time. While we are integrating those systems into our platform, we see a significant opportunity to provide a full end-to-end solution that can deliver superior outcomes compared to just integration. Often, those EHRs and other platforms fall short in offering advanced capabilities, particularly in AI. This is one area where we see potential. I'm sure Steve has additional insights to contribute.

Stephen A. Snyder, Co-CEO

Thanks, Hadi. And Allen, thanks for the question. So if we focus in particular in terms of the EHR for the inpatient space, our focus is primarily strategically on the critical access hospital space, where there are roughly 1,300 critical access hospitals across the United States. And if we kind of step back even further and think about the inpatient hospital space from an EHR perspective, there's a very small universe of vendors who are focused in on this space and have the technological capability to develop an end-to-end solution. And there's an even smaller number that have not only the technological capability to develop an end-to-end solution from a clinical perspective, but also have a long track record of meeting the needs of hospitals and independent practices from a revenue cycle management perspective. So, we're excited about this. This is a pretty huge milestone in terms of our overall ability to penetrate this market and to reach out to this market. And over the next quarter, we're excited to share some additional information and some additional updates as we move forward.

Allen Robert Klee, Analyst

Could you comment on how medSR remote patient monitoring and chronic care management performed?

Stephen A. Snyder, Co-CEO

If we take a moment to reflect on the year and our strategic focus, there are four main objectives. First, we aimed to gain a leadership position in the AI sector of the healthcare IT market. Second, we worked to stabilize our overall revenue, and we are pleased to report that revenue has increased year-to-date. Third, we focused on expanding our margins, and in the most recent quarter, we achieved positive net earnings for the first time in our company's history. We have maintained the momentum from last year into this year. Lastly, we concentrated on renewing our efforts in acquisitions while also promoting organic growth opportunities. Regarding medSR, we are happy to report that its revenue base has stabilized, similar to the overall revenue across the company. We expect this year's revenue to be roughly the same as last year's. Although there is still time to achieve more, we are working towards that goal. In terms of remote patient monitoring, it's an exciting addition to our revenue mix, but we continue to expect it to contribute about 5% or less to our overall revenue, which is where we currently stand.

Operator, Operator

We have our next question from Michael Kim with Zacks Small-Cap Research.

Sung-Chul Kim, Analyst

First, just a follow-up on your focus on more specialized practices and your efforts to bring a fully integrated end-to-end solution to market. I am curious about the incremental opportunities you might see as you look to the future.

Stephen A. Snyder, Co-CEO

Certainly. Thanks, Michael, for the question. From the perspective of overall growth, our focus continues to be on upselling the existing revenue base, so delivering value and meeting the needs of our existing client base and looking for other opportunities, whether it be RPM or other opportunities from an upselling perspective, together with the net new types of opportunities that you referenced that are more specialty-specific EHRs and the like. And as we lean further into the inpatient space, we're excited about having a brand-new market that we can unlock, especially the smaller healthcare facilities, the critical access hospitals and those that are generally speaking, 25 beds or less, together with the life sciences opportunities we've spoken about before. So we really see, again, when we look at this year, looking at those kind of 4 key objectives, we're pleased to see that at least along all these 4 key objectives, we're really tracking well.

Sung-Chul Kim, Analyst

Got it. And then just in terms of M&A, just wondering what you're seeing from a competitive standpoint. And then obviously, you talked about the strengthening balance sheet, but just curious how you're thinking about capacity from a funding perspective?

Stephen A. Snyder, Co-CEO

From a competitive standpoint in the M&A space, we are observing a very active environment concerning health care IT and revenue cycle management opportunities. As mentioned previously, we believe that over the last 1.5 years, overall valuations in this sector have stabilized, returning to levels closer to those seen before COVID. This creates additional actionable opportunities for us in the revenue cycle management sector, as well as in the wider healthcare IT field. We are also noticing distressed companies and core and non-core assets being offered in the market, and in many instances, we see a chance to apply our operating model, scale, and healthcare IT capabilities to unlock significant value within these businesses. Regarding funding, we are approaching all these acquisition opportunities with a disciplined strategy. We are in a strong position to support these tuck-in deals through our internally generated cash flow. Additionally, we have an untapped and undrawn credit facility with SVB, which provides us with extra flexibility. We believe we are well-positioned to advance and take action on these opportunities as they arise. We are actively exploring which opportunities make sense as we aim to deploy our capital to drive further ROI. Overall, we are pursuing strategic acquisitions that are financially beneficial, operationally synergistic, and aligned with our long-term growth objectives, including the opportunity to utilize our AI technology.

Operator, Operator

Ladies and gentlemen, the line for the speaker has got disconnected. I request you to stay online while we get him connected. Ladies and gentlemen, we've got the management back. Please go ahead.

A. Hadi Chaudhry, Co-CEO

Steve, we cannot hear you.

Operator, Operator

Okay. Okay. I guess he's got disconnected again. I'll try to connect him. Please stay online.

A. Hadi Chaudhry, Co-CEO

Okay. While we are waiting for Steve...

Stephen A. Snyder, Co-CEO

Sorry about the disruption. I was discussing the overall strategy linked to the acquisition opportunities we're exploring. I was about to mention the RevNu Med acquisition, which serves as a strong reference point for our attractive prospects that align well with our business model. RevNu Med focuses on the hearing health sector, allowing us to acquire a business that not only brought an existing client base but also broadened our solutions into a new market segment. This transaction involved no upfront payment; the entire purchase price is based on future revenue. It represents the kind of tuck-in acquisition that suits us perfectly, with low customer acquisition costs, an immediate client base, and a platform we can enhance with our advanced technology and AI capabilities. This acquisition not only benefits us strategically but also opens doors for organic growth. For example, we've successfully met and exceeded the needs of RevNu Med's largest customer, who has opted to extend their initial one-year contract to a three-year agreement. This reflects the success of our approach. Additionally, we've deepened our reach into the audiology and hearing health market. Each acquisition is unique, but this one exemplifies what our acquisition strategy can achieve. Michael, do you have any further questions regarding acquisitions or any other topics?

Sung-Chul Kim, Analyst

No. That was very helpful.

Operator, Operator

We have a follow-up question from Allen Klee with Maxim Group.

Allen Robert Klee, Analyst

It's evident that your free cash flow generation provides significant options and advantages for you to pursue. This is quite positive for your outlook. Regarding your outlook, I wanted to ask if you could share any insights on seasonality for the third and fourth quarters. It seems like you are leveraging AI internally, which might help improve margins. Additionally, could the new revenue contributions counterbalance the costs associated with hiring at the AI data center, also known as the Center of Excellence? Is that the correct way to think about this, or what further information can you provide?

Stephen A. Snyder, Co-CEO

Good question, Allen. I'll let Norm provide some additional detail. We believe the right way to approach this is as follows. First, in response to the second part of your question regarding AI, our goal is to establish an AI Center of Excellence that solidifies our position at the forefront of healthcare IT AI. This is our internal investment. We expect our free cash flow this year, excluding new acquisitions, to match or exceed last year's despite the increased investments. This positions us well for both organic and acquisitive growth. Regarding acquisitions, this is a common theme we notice in discussions with sellers, who understand the market is changing. They recognize the need to either utilize their own AI technology or collaborate with us to enhance AI capabilities for their clients and their operations, thereby reducing costs and improving efficiency. Now, Allen, what was the first part of your question again?

Allen Robert Klee, Analyst

Just thinking about seasonality of revenues in the second half and then expenses.

Norman S. Roth, Interim CFO

As we develop the AI Center of Excellence, we will fund it through our strong internal cash flow, which we expect to increase. Regarding seasonality, I would anticipate that this year's third and fourth quarters will resemble last year's, with some modest increases as Steve mentioned. The first and second quarters have been strong, and I expect that trend to continue.

Allen Robert Klee, Analyst

I'm sorry. I think that just in terms of capitalized software, what is that focused on?

Norman S. Roth, Interim CFO

So the cap software is basically right now improvements to our existing platforms and the packages that we have. We're always putting in modifications and just making it more AI focused. So as we're making these updates, GAAP allows us to capitalize that and then we amortize it over a short period.

Allen Robert Klee, Analyst

That's great. In general, when you're speaking with customers and discussing all the enhancements you're implementing with AI, can you share some insights on how those conversations are going? It seems like you have much more to offer your customers now.

A. Hadi Chaudhry, Co-CEO

Yes. Certainly. The advantage for us is that they are already using our existing platform, so our internal marketing and sales strategy begins with displaying the right messages in the right places, like through splash screens. For instance, with cirrusAI Notes, we've observed that over 75% of clients who start with a trial period continue using it afterward. The feedback has been very positive. Although there is a 25% dropout rate, most of these occurred in the initial stages, and we believe this number could exceed 75% with time. We're noticing increasing traction towards AI as our clients hear more about it in healthcare, and when they get a chance to try it out, the vast majority engage with it and continue using it. Additionally, there are small features, like basic AI for summarizing charts, which clients find appealing. As they begin to utilize these features, adoption is rising, and everything looks promising at the moment.

Operator, Operator

Ladies and gentlemen, as there are no further questions, I would now like to hand the conference over to Norman Roth, the CFO, for the closing comments.

Norman S. Roth, Interim CFO

Thank you, everyone, for joining our call today. Hope you have a great day. Thanks again. Bye-bye now.

Operator, Operator

Thank you, sir. Ladies and gentlemen, the conference of CareCloud has now concluded. Thank you for your participation. You may now disconnect your lines.