- Athenahealth on Monday disclosed a 7.4% increase in total revenue for the second quarter of 2018 to $323.3 million.
- Bookings for the health IT company declined 4.8% during Q2, down to $74.9 million compared to $78.7 million for the same period in 2017.
- On a call with investors, CFO Marc Levine said athenahealth endured "quite an eventful quarter." In May, Elliott Management sent the company an unsolicited acquisition offer valued at as much as $7 billion. Also, former CEO Jonathan Bush stepped down in June after news surfaced that he assaulted he ex-wife several years ago and amid additional allegations of sexual harassment.
Athenahealth is in the process of considering its options, whether that be a sale or the decision to remain an independent company. Levine told curious investors he is "limited" as to what he can reveal, but did say there's "strong interest in athenahealth."
Elliott Management, which has about 9% stake in the company, has made two acquisition offers, the latest being a $7 billion bid placed a month before Bush's exit. After receiving nothing but a "boilerplate" response to its bid in May, the asset management group sent a seething letter to athenahealth's board scolding the company's leadership.
Elliott Management's offer still stands, but athenahealth chairman of the board Jeffrey Immelt said the company has no timeline for deciding on a future transaction.
When asked how clients have reacted to the news of the past quarter and how those events have impacted business relations, Levine said every company in the industry is preoccupied with its own potential M&A. "You guys are all healthcare analysts," Levine said. "You know the amount of change that's going on in the industry and the amount of big, seismic changes underway."
Oppenheimer analyst Mohan Naidu maintained a buy rating on athenahealth following the company's second quarter earnings release. Its decline in bookings, Naidu writes, is "reflective of market conditions."
"We continue to believe that athenahealth is a unique asset that has the potential to be the base for significant disruption in healthcare and believe in high likelihood of a transaction," Naidu writes.
Levine said the company showed solid sequential improvement in bookings in Q2. Bookings declined during the first quarter to $52.2 million, down from $77.3 million during the first three months of 2017. "Bookings can be lumpy in any given quarter do to the mix of large deals in the period," he said.
Athenahealth updated its fiscal year 2018 guidance to reflect its performance over the first six months of the year and, while financial measures for the guidance have all increased, Levine said the company expects to fall "slightly behind" its full-year investment plan.