Great. Good afternoon, everyone. I'm Craig Hennenbach. I cover the health tech and provider space for Morgan Stanley. Thanks for being here at day two of the conference. We'll close out, I think, on a strong note here with Omada. Very pleased to have CEO Sean Duffy and CFO Steve Cook. Welcome. Thank you. Just before I kick off here, I do have to read some disclosures for the Morgan Stanley MorganStanley.com/research disclosures. With that, and again on the heels of the IPO and your first quarterly earnings report, I think people are familiar with the story, but still love to just kind of high level set the stage in terms of a brief overview of Omada Health, and then we'll dig into some more detailed questions. Perfect. Thank you. Thank you so much, Craig. Have everybody, Sean Duffy, Co-Founder and CEO of Omada Health, saving the best for last. Obviously, I hope you guys had a good day and enjoy the rest of your evening after we wrap here. For those of you less familiar with Omada, I'll just tell the quick story here. Omada is a between-visit provider. That's in response to what I recognized, you know, while in medical school, while founding the company, that the vast majority of the 156 million Americans with chronic disease are kind of stuck in this visit-by-visit model. I'd hear my friends, practices, and clinicians say like, "Look, I send these patients out of my clinic with diabetes, and I say, 'Lose weight. You know, take your medicines. Exercise. Eat differently. Check your sugars.'" I only know that they don't have any support. That void is what we aim to solve. We asked, what is the solution to that void? It's proactive day-to-day longitudinal care with a different care model, different reimbursement structure. Kind of ground up was really the answer. That's what we endeavor to build in day one. The care areas we're in are prediabetes, obesity, diabetes, hypertension, musculoskeletal care. We're proud of the progress. We're here as a public company. Just had our first earnings call and some key stats to give you a sense of the business. We're north of 2,000 customers. For us, that's either an employer, a health plan, an integrated health system, or a PBM, you know. When we use the word member at Omada, that means someone that's actively under support and that we're building on. It's end of Q2. We had 752,000 members. The Q2 result was a $61 million quarter, which we're proud of. That represented 49% year-over-year growth. We like what we see in the business. We're in this remarkable moment, not only in digital health, but in medical metabolic care. I'm sure at some point you'll ask me about the 2Gs, GLPs, and GPT because both have a lot of relevance for us. Sure. We will get there. Great to see the good start right off the bat from earnings. You mentioned the four programs, weight and prevention further along and still some good growth there. Can you maybe just tick through the programs, where they're at, and the growth prospects that you see there? Yeah. For everyone's reference point, our journey began in prediabetes and obesity, or we call it weight health sometimes. Later, in roughly 2019, we expanded to diabetes, to hypertension, and MSK care from there. We have had a strategy of selective breadth. We recognize that if you are to expand, you need to do a great job. Equally, when we talk to our benefits buyers and share that, look, you could have one account manager versus four. You could have one company organizing marketing campaigns to your employees. Your employees have multiple disease conditions. That's attractive. The order upon which they're represented in the business roughly mirrors the order which we've rolled them out. Now we have over 31, as of the end of last year, over 31% of Omada Health's customers overall work with us in a multi-condition fashion. We're proud of the progress in each. Great. Can we touch on just the TAM in terms of across self-insured, fully insured, and Medicare Advantage? You're most furthest along in self-insured, but there's still a long runway for growth. What are some of the strategies that continue to penetrate that TAM and drive growth? Yeah. Within the Omada growth algorithm, you're highlighting the first bucket, which is acute pace. Within that, you can think of it as a kind of a matrix of which type of insurance and then which programs we offer. We got our start in the commercial space. We have about 14% penetration in self-funded lives, about 9% in fully insured. Obviously, in the U.S., if you're a large enough employer, you self-insure. That led to many relationships with payers that then looked at what they saw there and started to write us into the fully insured lines of business where they want to capture some of the outcomes and the savings as well. More recently, Medicare Advantage has become productive for Omada. We're still very, very early there, about 1% of that market. That's actually in response to some of our existing payers telling us that, you know, look, we'd love to put you into MA. We're happy to work with and able to work with really any entity that carries the risk of medical and pharmaceutical claims for that person. All right. I won't keep the 2Gs waiting any longer. We'll get to GLP-1s now, and then we'll follow up with some ChatGPT. On GLP-1 Care Track, can you just kind of give us an update in terms of that program? I know that was released yesterday, a new study. I know that's important to your selling motion. You know how it's resonating with your customers and members? Yeah. Omada's metabolic offering has a CareTrack. We call it our GLP-1 Care Track. The overall Omada experience involves us marketing to you, making sure that you're coverage eligible, getting you connected to devices, pairing you with the care team, working with you on goals, content, creating communities, having tracking. We updated all the pieces of the surface area to be responsive to the needs of someone on a GLP-1. That's the CareTrack. We turn that on in our technology stack when someone's on a GLP if the customer's purchased it. It's been just wonderful to see. Most important is, of course, the patient and the member. The stories that we hear are inspiring. We bring these members into a town hall to help our employees remember why we're here. What we see is this really remarkable thing where these meds can actually serve to get the ball rolling as a behavioral catalyst. At the end of the day, an injection is not getting to know you as a person. A pill doesn't understand your goals and help encourage different ways of eating or physical activity. The goal is to really grab that, ideally attain higher quality and more on therapy progress. If the person's goal is to discontinue the med, which we try to ask right up front, to help enable their success. We've got this. This is great. This is scaled with two of the three nation's largest PBMs such that their clients can, with the push of a button, turn it on, as well as our other products. What we announced yesterday is 12-month data of weight maintenance. Post-discontinuation, if you look at the randomized studies, someone should have regained about 11% of their weight back. The change that we saw was 0.8%. A night-and-day difference. That helps counter what, if you look at the real-world evidence, might be a "truth" that someone's destiny is to regain the weight. What we found is if you talk to someone up front and you ask them, "What are your goals for the med?" the answer that we usually get is, "Oh, I can't wait to have an injectable for the rest of my life." The goal is usually, "I'd love to see if I can get success and keep it off." That puts us in a position to have an honest conversation and say, "Love that. It's going to be hard." Your body will try to fight the way it can get it back on, but it's not your destiny. What we need to do while you're on the medicine is work extra closely together on food. What's a week in your life look like relative to eating behaviors on activity? Let us design you an exercise and strength plan that's an end-of-one plan that helps support your specific goals, accommodate your constraints, to try to retain as much muscle as possible. That dynamic has enabled success for our members. Of course, that translates into us being able to communicate that value to clients and potential clients. Great. As with any large market, there's, I'm sure, competition. What are some of the things that differentiate Omada? I know we can maybe touch on some of the PBM partnerships. Yeah. I think it's in four vectors. One, on the capabilities, Omada Health's taken a really a build-every-piece approach to the business, including what we call as our care team platform. This is a version of an EHR that our care teams use to engage with the members. That's enabled ops efficiency, our margin profile and progress, but equally a really personalized member experience that supports those longitudinal interactions that today's EHRs are not set up to do. Importantly, we blend those technologies with people. We call this approach compassionate intelligence. We're doubling down on, of course, all these incredible AI-enabled features. Sometimes I think of like the art and science at medicine, that tomorrow's horizon is the people are the art and the models are the science, but you need both. That unique capability of kind of tying all the pieces together is quite operationally complex. It's something that's hard to do even at 1,000, really hard to do at north of a million members. I think customers appreciate that, and we're differentiated on it. Then outcomes. From day one at Omada Health, we just started publishing. I was in medical school at Harvard when I founded Omada Health and thought, what would my classmates need to see to trust that the solution worked? We're like, better start getting some literature out there. We've done observational studies. We've done multimillion-dollar, like academic medical center-led, like therapeutics grades, like level 1 RCTs. We now have 30 with our newest MSK trial that we've published, 30 peer-reviewed publications. That allows us to earn trust with the market, which is great. I'd say last, the multi-product expansion has been a differentiator. There have been deals where they're like, that's just great. Would love to just start with you across multiple products. That solves a big thing on my mind, which is I don't have a team of 30 people to implement solution by solution by solution. Equally, I recognize that my employees probably have obesity and hypertension or diabetes and hypertension or diabetes and musculoskeletal disease. Got it. Clearly a very important aim for the broader market in healthcare in terms of GLP-1s. Any way to contextualize in terms of tailwind to the business? I know you're seeing an acceleration this year of a couple of points in growth. I don't know if it's that simple in terms of it's just GLP-1s, but just what type of impact does it have on the business today? As you segue into 2026, you'll have CVS coming on. How should investors think about just the trajectory? We did, in the data that you mentioned, share that the primary goal of this press release was to look at the 12-month discontinuation data. Equally, we did share that we're north of 100,000 Omada members that we're supporting that are on a GLP-1. What's happening is a dynamic that's creating two customer personas. There's the employers that cover, and there's the A and those that don't in B. In the A, they may have heard about our Care Track, and they're thinking, I've got this cost picture that looks pretty harrowing. Yet equally, I believe these meds are effective. What I don't want is waste. I don't want my employees to lose weight and regain it. I've paid thousands and thousands of dollars. How do I think about different ways to perhaps cover this? That's where our Care Track becomes relevant and opens the door. Equally, we've structured our contracts with our partners to enable the full Omada suite of solutions. It's very quick that an employer says, oh, why would I just cover Omada for my employees on a GLP-1? It makes sense to offer it in absence of. Maybe they'll try that first. There's certainly employees who are overweight in my organization that aren't ready for a medicine or don't want a medicine. I like your 30 peer-reviewed publications, including your health economic studies. What it's really doing is it's a gateway to a broader sale, and we're seeing that. Equally, in those who aren't covering because there's quite a financial consequence in doing so for these accounts, we're finding that their employees are still asking these benefits leaders, how come my friend who works for Acme Inc. has that down covered and we don't here? How come Wegovy is not on our benefit design? Those are pretty persistent asks. It's an easier message to say, look, we can't afford GLP-1s for obesity right now, but I'd like to introduce Omada, than we can't afford GLP-1s for obesity right now, but I don't have anything for you. We found relevance in both. The way we started to think of it is just an enormous floodlight on metabolic disease as a big problem area that's kind of creating deepened customer conversations. Great. All right. We'll segue to the second G in terms of technology and AI. How are you utilizing at this stage kind of AI to help improve member experience? Are there anything that you're kind of measuring in terms of, OK, this is taking hold? This is a starting point. Yeah. No, it's a very fun moment. I think not just our engineers, but if you're an engineer out there in the world, you're able to do some of those things you only dreamed about. I mean, prior to going to med school, I worked at Google. You talk about this future vision where the technology could do things like we're all witnessing in our pockets every day, and it felt impossible. We've launched this umbrella capability called Omada Spark with some specialization relative to some agents that support our members, ranging from being able to take a picture of your food and have it pull apart the different ingredients, look at the macronutrients, help orient toward our food philosophy, which is not one of restriction, and it's one of nutrient density to give our members deeper insights in what they're eating more efficiently. We launched a nutritional agent similar in the art and science question. Our care team's primary job is compassion, accountability, feelings of empathy. A future vision is not them helping shape that specific salmon recipe that accommodates that specific dietary preference or perhaps restriction for that member. The models need to do that. This agent is just incredible. It's contextually offering nutrition advice based on data patterns, the demographics, the preferences of the person. We trained a model to do a motivational interview, which is a technique in the 1980s that helps a patient unpack some of the perhaps barriers to their goals and find solutions themselves, which is really neat. Our health coaches can say, you know, hey, Craig, I love the way you're thinking. You're doing me a favor. Just spend 10 minutes tomorrow with Omada Spark on that same line of thinking. As you'll see when it tells you, it's going to summarize that conversation with me. I want to know how it goes. I'm going to check in with you the next day. It's interesting. The care teams are almost starting to delegate either some of the esoteric items like that recipe or like the motivational interview in this beautiful combination of people and tech, which I think stands to differentiate. One thing we did share in the earnings call is the feature set within our care team platform that summarizes the context to a care team member of what's happening with their member to a care team employee. Whereas before, they'd have to scroll through, try to identify patterns themselves, really poke to gain insights and come up with a point of view on what they might want to address. Now we send that out to the model, all on our secure infrastructure. The model suggests, based on the context, some of the areas that they might think about using to have their next dialogue with the member. We've seen in some of the pilot data last year, roughly 20% efficiency gains within the first weeks, but increased quality. That's where the sweet spot is, where you can get efficiency and higher quality, which is some of the magic of these technologies. We're trying to encourage every single product manager at Omada Health to have an AI-first mindset, whether they're responsible for content or the community layer or the tracking layer or the onboarding or the care team, because there may not be relevance in every feature to leverage AI, but there may be. This is one of those. It's not going to be a silver bullet. Our view is it's a bunch of lead bullets that are going to add up to just that experience we want to create where the member feels like, wow, for the first time in my life, I have someone in my corner that the tool I want to use. It's an enjoyable care experience. It feels like it's built for me. It's proactive. There's a huge innovation roadmap ahead to work to enable that goal. Great. Because it's early days, I think the way the company has framed the potential from a financial perspective is your long-term gross margin target is 70% plus. Perhaps it can drive upside there. How should investors think about that in terms of how this technology scales and financially longer term? Yeah. No, happy to take that. For those of you who haven't met Steve Cook, CFO here at Omada Health, we have a direct line of sight to getting to 70% gross margin on just what we're already doing. That's more multi-condition traction, more traction with GLP-1s, and increasing our marketing effectiveness. We're early days with Omada Spark, early days with contact summarization and underwriting those into our future margin targets. I think to punctuate what Sean said, one unique and differentiating feature of our business is we only bill for those folks who are actively engaged in our program. If they stop using it, we stop billing. If they stay actively engaged, we continue to bill. AI has this really neat dual benefit where there is a cost layer where we can make our care teams more efficient. They can end up serving more members. Increasing personalization and having folks stay in program longer is also going to drive more revenue with very little incremental cost. Great. Maybe we'll stick with you, Steve, in terms of I do want to touch on just the operating leverage in the business. You're kind of right on the verge of profitability, expected to grow 40% this year. What are some of the things your organization is doing just to control costs? Maybe some of these things that you've done private before you came public, but just what gives you the confidence in the operating leverage in the business? Yeah. I mean, it's been a tremendous focus for us, especially over the last couple of years, to demonstrate operating leverage within the business. We grew the past two calendar years at 38%, as you mentioned. This year, guiding currently 40% revenue growth. We're realizing operational leverage across a couple of main areas. Our sales team, you know, we often contract with a lot of the major PBM partners as well as dozens of health plans. We were able to leverage the sales force through our distribution channels to go and distribute Omada. As a result of that, our sales team is very moderately to small in size relative to the amount of revenue we're doing. On the marketing side of the equation, the main medium for getting folks in the door is email marketing. We did 100 million emails last year, 5,000 distinct campaigns across our 2,000 customers. As we think about future scale, when we have to do 200 million emails, we're not going to need to double the size of that team. It's a very cost-effective medium for us to get folks in the door. Sean alluded to this a little bit earlier, but it's really the crown jewel of Omada, which is our care delivery platform. This is our homegrown EHR. This is the platform that our care teams use every day to engage with our members. Over the course of the past decade, we've invested tens of millions of dollars into our care delivery platform. We can continue to intake hundreds of thousands of more members without needing to disproportionately invest into our care delivery platform. I think we talked a little bit about our GLP-1 Care Track. We spun that up in three months on our existing tech stack. We really approach development there with modularity, with flexibility in mind. Across those dimensions of sales, marketing, and then the R&D side of the equation, we feel we have a lot of operational scale. Got it. If you think through even the long-term target of 20% plus, maybe some of the things we just discussed, what are some of the things you're most confident in terms of being able to drive towards those types of margins? I think we don't need to absolutely sprint there. I think we want to take a measured approach. We like the growth. We like that we've grown 38% years in a row, and this year we're at 40%. I think continuing to have an eye towards investment and being assertive on the GLP-1 landscape, continuing to invest in AI, as we talked about, is important. We really feel like those existing levers are going to continue to benefit us in the future, as those are the main vectors of OpEx burn. Great. I would like to touch on we're kind of right in the heart of the selling season, kind of underway, and just particularly from a year-to-year basis. I know whether it's the recent study you just put out yesterday, like what are you most excited about as you get in front of prospective customers this year? How does that compare to just a year ago? We gave some qualitative remarks on the earnings call, and I'll just kind of reemphasize those. We like what we see. The pipeline is progressing in a way that we expect. This cost crisis of GLP is really opening doors. That's not a new thing this year. It's cost pressure for accounts. We've observed in past increases knocking on Omada's door to say, clearly the existing system is not working for me. I might need to do something. I think the thing that is just exciting for us is what I already shared, which is the fact that GLPs are really spotlight on metabolic disease. That's needed. If you add up all the member success we've had, all the member success the entire competitive set has had, are we even near the 156 million Americans that are being poorly served by the existing healthcare system? No. Omada's explicit mission is to bend the curve. It's exciting that the cost pressure of GLP is shining light on this broader need to support new ways of thinking in metabolic disease. Of course, as we've seen in the administration, there's just an increasing focus on chronic disease. I feel like we've been having this megaphone for a decade. Now the megaphone is being amplified in so many different ways. At a moment where Omada is a scaled partner, we've enrolled over a million members on strong foundations for their channel partnerships. Buyers can, especially in a somewhat turbulent last two or three years from digital health, be confident that we're going to be here to stay when they look at our progress. They can go to, look at our, listen to our earnings calls, look at our balance sheet, which is neat. I still, to this day, always do new hire CEO welcomes. I have a chance by Zoom in a group setting, at least, to meet every single Omadan that comes in the door. Over the last couple of weeks, what I've been sharing with the talent that joins is, you're joining Omada at an era where we can actually aspire to achieve our mission of bending the curve. The early days were just setting us up for that. You got to get to the many, many tens of millions, obviously, to do that. Great, it's day one. My ask is to run as hard as we can together to do that. That's a really inspiring thing for an entrepreneur where you feel like you've just got the foundations laid to be able to finally dream big and accomplish what you set out to do from day one. Got it. How about just the macro backdrop today? Does it come up through customer discussions? Maybe we can build on that in terms of kind of platform versus point solution and how topical that is. Yeah. I mean, it's not a fun year from a renewal standpoint. It's like, you know, even myself in my seat, I was bracing. We came in a little bit better. I like to thank our benefits broker. I've shared what we're observing in our customer conversations is, you know, the cost pressure, which is for many self-insured, it might be kind of an upper single-digit benefits renewal year or north. That's what leads them to be like, clearly, something needs to be done differently. That allows us to say hi. On balance, my general sentiment relative to how others feel about their businesses is pretty positive. I mean, there's a lot of conversations happening in the pipeline. Got it. We touched a little bit before on just multi-condition sales, and that's very powerful from an operating lever. You mentioned 31% of customers today. I think last selling season was over 50%, so directionally moving the right way. How important is that when you think about the business model? Also, just to dig into the platform and multiple ways you can approach it versus just a point solution. Yeah. I mean, we like our strategy. You hear point solution versus platform all the time. Obviously, you can build big businesses in both. At the end of the day, my belief is the buying preference, especially at the level of the employer, takes for a platform. We didn't expand just because we wanted to. We expanded because our customers specifically told me, "Sean, could you please do type E's?" Sean, any chance you thought about hypertension? Sean, have you ever thought about MSK? That's because they know us. They're thinking, do I really want to have another contract, another account manager? Equally, they recognize their employees have multiple comorbidities. That being said, in absence of a company that can deliver excellence in each of those, they'll buy point solution, of course, because they need the problem solved. We're very cautious in expansion. If anything, our bias is to not. We're going to do it when we feel like we've earned the right to do it. There's a pretty high bar of, we think that there's a clinical need. You can deliver virtual care. It fits the between the care model. Most importantly, there's buyer demand. If you look at the average, like Willis Towers Watson, Mercer, Aon report, they poll these benefits leaders and ask, what are the things you're concerned about? What do you care about? They'll get a pretty consistent list back. It tends to be obesity, prediabetes, diabetes, hypertension, musculoskeletal care, behavioral health, maternity and fertility, and cancer. That's kind of the big ones. Relative to ones that have relevance for between-visit care, we feel like we're in the right area for now. For your point, you get operating leverage from it. It's great because you're solving a customer problem. Your members love it because it's like you don't have a different app for hypertension or diabetes. You don't need four sales reps to sell for condition areas. We also happen, there's a nuance here, relative to the price points in the market, one's able to garner somewhat higher ARPU for diabetes and hypertension MSK than prevention obesity product. We just like the prevention obesity price. We're very, very happy with it. At a unit level, everything we feel good about. We're upselling into higher ARPU areas. That's one of the factors that's led to the acceleration in growth and the back-to-back 38%. I shared our August 7th guide. Midpoint is at 40%. I think Costco is a great example of this. We signed them up in 2013 on our prevention and weight health products. Once we released diabetes and hypertension and MSK kind of around that 2019 period, they ended up adding all of those products in subsequent years to one another. Our CFMs or post-sales reps are always really excited to go back to our existing install base and then cross-sell and upsell across our product suite. That, to Sean's point, added a ton of leverage as well as revenue tailwinds to the business. Great. I feel like MSK doesn't get much attention. It's small today, but it gets really well in terms of multi-conditions and comorbidities. Can you just maybe touch on that kind of offering, kind of where it's at and how you see that in the marketplace? Yeah. I mean, we're really proud of the solution. It's, of course, our newest capability. That was an acquisition. Found a small company that had just an extraordinary product, got too many customers. We looked at it and this is literally written on the same text back. We felt we could de-risk the product integration, which is where oftentimes these things fall short. Very proud of the experience. You get a licensed Doctor of Physical Therapy to do a video visit. We have an animated library of like 400 exercises, pre-curated care plans that will be loaded up. There are all these cool computer vision technologies that help look at functional testing over time. Message your GT. It's really neat. Increasingly, what we're helping the buyer market to realize is the connection between obesity and especially chronic MSK, knee, back, and hip, which are some of the biggest cost drivers. Those tend to be the most obesity-driven. It's an asset we really like to have. It's also like when we made the expansion similar to our existing model, there were enough clients that were asking us to do it that it was kind of like the investment in doing it felt pretty de-risked because you have a—we always try to ask our customers, "You're on our strategy desk. Like what guide us as our Chief Strategy Officer? What would you want us to do? Where would you want us to go? How could we better serve you?" That answer came back enough. I think this would make sense. Great. In the last couple of minutes here, I'd love to wrap up and just talk about investor feedback. I know you were here the last day and a half with meetings. Maybe some things that are really resonating with investors to the story and then also some things where investors are trying to dig in and learn a little bit more about Omada Health. Yeah. No, for sure. I mean, it's a lot of the themes that we covered. The conversations tend to usually start with like, "So GLPs, how do I think about it? Is that all of your membership? Is it a tiny amount? Is it like what?" Once I explain the selling dynamic, we've found folks can wrap their heads around it. Of course, putting out some data helps with that as well, which is exciting. Sometimes we get asked, "Can AI replace your entire care team?" It's like, "No, you need the accountability." It's hard to find a member that says, "I feel accountable to my large language model." Equally, in the art and science, they should be doing, the model should be doing the science. That's been a key theme. One of the ahas that sometimes happen specific to your questions is once they realize that we contract as a provider and bill into real medical spend, which is, I think, a material difference in this next generation of digital health companies that have matured. I mean, these are companies like Omada Health that are actually delivering the care. It's not incremental technology solutions on top of the existing system. It's actually the care through with peer-reviewed studies. I remember early conversations with benefits leaders recognizing that, wow, success will not be trying to get them to put us in their admin budget, which is minuscule relative to their medical pharmaceutical spend. That's where market cap is. It's in the medical and pharmaceutical spend. Omada Health contracts with a covered entity. We filed claims ages ago. I took our trials to the American Medical Association. I actually got them to create the first-ever digital-specific CPT code. It's like a CAC-free code. It serves as billing infrastructure. Even in our direct contracts with employers, we file claims through their TPA on our monthly recurring revenue model when someone signs up, such that it's in the medical spend, which is a super exciting difference. We're a provider that's not anchored to having to use fee-for-service billing models. That's not anchored to having to put the CapEx needed to build our clinics and can equally deploy in Alaska as your US Virgin Islands, which is a very material difference in my view in this next view, this next chapter of digital health companies. Great. With that, I think we're right on time. Sean and Steve, thank you so much for spending the time with us today. Super. Thank you for joining. Enjoy the rest of your evenings and safe travels home for those of you who are visiting. Great. Cool.