Outset Medical, Inc. (NASDAQ:OM) Q4 2022 Earnings Call Transcript

Leslie Trigg: Let me €“ I’ll add Rick, I’ll add a little bit of color too. I’ll add that we aren’t seeing any worsening of staffing or any worsening of the capital spending environment. There’s really nothing in the macro that has changed from Q4 or really from our preannounced at JPMorgan. From my vantage point, we are entering €“ we have entered Q1 and 2023 from a very, very exciting position and so I am really bullish on the year. We have a lot of momentum, both on the acute and the home, so there’s nothing in this that concerns me whatsoever. I think I’ve seen this a bunch just in other capital equipment businesses. That you know Q1 sometimes can be a little bit flat to Q4. So I just wanted to add that there’s really nothing in the macro fundamentals that is new or different here.

Rick Wise: Yes, good, good. Leslie, the Bridge program has obviously been a huge success based on the customers I’ve spoken with. But I had the sense maybe if we heard when we heard from you, three months ago or so about it, that you thought it was going to be the terminator. I don’t know, am I misreading you? It sounds like it’s going to be a little longer. I think that’s excellent. So I guess my question is, maybe talk about where you are, how long does it go on? Is this maybe in the best sense of permanent program. I just wondered about the impact on margins from this program, good or bad?

Leslie Trigg: Sure yes, I’m happy to talk about that. I think there are two questions when you talk about duration or two aspects to duration. One is the program duration, and then the other is the duration of each implementation, and so when I talked about you know short term in nature so far, that remains true and that speaks to the duration of each implementation itself. We offer our partners the option of using bridge for up to 90 days. However, I think the great news is almost to a customer they have been able to hire dialysis nurses faster than they originally feared it would take, and so most of our implementations have been on the shorter side, well less than 90 days, so that was the point I was making a few weeks ago.

In terms of the duration of the program, I you know €“ I think it’s going to be a part of our portfolio or part of our sales process for as long as it adds value. We in no way shape or form intend to or want to be a staffing company, but we don’t need to be. A lot of the value here, probably the majority of the value is in our ability to just give €“ help us in executive comfort that sort of I think I said psychological safety in the past, that if they have trouble staffing, if it does take longer than they expected to, we’re there for them. And it’s a stop gap, a lever that they can pull as needed. So I think what I love about bridge is that we’re getting a lot of value for it without €“ really without much material cost to it at all.

So we’ll see more to be revealed Rick, but I could see it a part of our portfolio you know for some time in the future in €˜23, but not necessarily in the form of a lot of implementations, but just giving customers the knowledge that it’s available if needed.