Progyny, Inc. (NASDAQ:PGNY) Q4 2022 Earnings Call Transcript

Stephanie Davis: Another one that keeps surprising me. Let’s talk about your margins. So we’ve seen a healthy level expansion in recent years. We’re starting to really narrow the spread between your EBITDA and your gross margin here and it still does feel a lot of upside. So my thought is how sustainable is this level of upside? What’s driving it? And I guess with margins in mind, how are you thinking about your buy versus build algorithm as you touch on some of the areas you’d like to expand on this call?

Mark Livingston: Yes. I mean — thanks, Stephanie. We’ve definitely been narrowing the gap between gross margins and EBITDA. And obviously, we constantly point towards that margin on incremental revenue which has been in the high teens and low 20s guidance for this next year at 19.4. We continue to be able to leverage across each of our lines, whether it’s our care management service teams. And as we retain our clients and bring new ones on, we’ve not needed to grow those teams at the same pace as revenue. And certainly, G&A, we’ve continued to leverage down pretty well. And as Pete said, I think a little bit earlier to another question, our focus on sales and marketing and go-to-market and to continue to make investments there so that we can drive the business forward to, as you just asked about a second ago, keep raising the bar for ourselves and keep growing the company, given how much opportunity there is out there.

So that’s our position and we think that we can continue to do that for — certainly for 2023 and likely beyond.

Operator: This concludes the Q&A portion of the call. I’d now like to turn it back to James Hart for any closing remarks.

James Hart: Thank you, John and thank you, everyone, for joining us this afternoon. Obviously, to the extent you have any follow-up questions, please feel free to reach out to me at your convenience. And we look forward to speaking to you in a couple of months for first quarter.

Operator: Thank you. Ladies and gentlemen, this does conclude today’s conference call. You may disconnect your phone lines at this time and have a wonderful day. Thank you for your participation.