Q: Should the Empower Healthcare and Compliance Partners acquisition be viewed as minor financially but bigger from a cross-selling perspective? A: CEO Steve Snyder confirmed this is exactly how to think about it. The acquisition closed mid-May and had minimal impact on Q2 results. The real value is twofold: incorporating compliance expertise into the broader platform to launch a SaaS version of what was previously delivered manually, and cross-selling revenue cycle management and EHR solutions to Empower's existing client base. He noted that Empower's founder, Mitch Bree, had previously referred business representing about 10% of CareCloud's annualized revenue, and the acquisition structure includes an earnout based on Empower's ability to drive growth and cross-selling initiatives.

Q: Can you provide more detail on the new business signed through Q2 for Stratus AI Front Desk and demand across the client base? A: CEO Steve Snyder noted that CareCloud is in active conversations with private equity groups focused on healthcare companies about partnering to optimize revenue structures and reduce costs, particularly around AI needs. Chief Strategy Officer Hadi Chaudhry added that demand for Stratus AI continues to grow with new deals being signed, but the company is prioritizing implementation depth over breadth. AI-specific revenue will be disclosed separately once it reaches a scalable level, but currently remains embedded in technology-enabled services revenue.

Q: Regarding cross-selling, are you referring to Empower and MedSphere, and have you exhausted all opportunities with MedSphere? A: CEO Steve Snyder clarified that cross-selling with Empower is already well underway, though no new signings have occurred yet given it's only been a couple of months. For MedSphere, there remains significant opportunity for additional wins. The company has already seen traction in expanding wallet share with hospitals from the MedSphere acquisition, but is still in the early innings of the overall cross-selling opportunity. Hadi Chaudhry added that there is an active conversation with an existing private equity-based enterprise client about an AI-powered platform engagement, which serves as strong validation of their AI capabilities, though specifics will be shared once materialized.

Q: You tripled your sales forcehow has that changed expectations, are they up to speed, and do you plan to expand further? A: CEO Steve Snyder confirmed the significant expansion of the sales force, which remains focused primarily on cross-selling and expanding existing wallet share. This approach is less expensive than pursuing net new wins. The team is fully up to speed on the applications, particularly those who joined through the MedSphere acquisition, as they already understand the products and how to position them for cross-selling opportunities.

Q: Any update on the cyber breach from March, and will insurance substantially cover all costs? A: CEO Steve Snyder stated that based on current knowledge, the incident will not have any material impact on operations or financial condition. The March 16th incident affected a single environment within CareCloud Health, and the system was fully restored the same afternoon. Forensic analyses validated that the bad actor was expelled on March 16. Notices are being sent to impacted patients, and the company believes insurance coverage will cover all costs including patient communications, forensic analysis, legal costs, and litigation fees.

Q: Can you elaborate on the factors driving the lower GAAP net income and adjusted EBITDA in Q2 2026 compared to the prior year? A: Interim CFO Norman Roth explained that profitability was impacted by continued strategic investments in AI-enabled capabilities, higher interest expense from borrowings to redeem the Series B preferred stock, and additional amortization expense from recent acquisitions. Gross margins remained consistent between periods. The company views these as investments that will drive long-term customer value and strengthen competitive position, with benefits expected to materialize in the second half of the year.

Q: What is the status of the AI product development timeline, particularly for prior authorization and AI-assisted medical coding? A: Chief Strategy Officer Hadi Chaudhry confirmed that AI prior authorization and AI-assisted medical coding remain on track for market launch this year. Prior authorization is moving through pilot deployments, while coding continues to run internally as it's refined to expected accuracy levels. These address two of the most painful and costly problems in healthcare administration. The company also completed specific platform commitments, including parity gaps on the inpatient revenue cycle platform, CareView modernization, and WellSoft integrations with Breeze and Stratus AI notes in emergency department workflows.

Q: How is the company's capital structure improved following the Series B preferred stock redemption? A: CEO Steve Snyder highlighted that the full redemption of Series B preferred stock on May 15, funded through a $50 million credit facility with zero dilution to common shareholders, eliminates approximately $3.3 million of annual preferred dividends. Through the first six months of 2026, the company paid approximately $6.4 million of preferred dividends, but the substantial majority of that obligation is now permanently behind them. Beginning in Q3, far more of every dollar of net income will flow through to common shareholders, reduced only by the cost of the less expensive debt that replaced the preferred stock.

Q: What progress has been made on the MarketWare physician relationship platform? A: Chief Strategy Officer Hadi Chaudhry reported that MarketWare completed its flagship integration with Practice Match, added an integration with Doc Cafe, and launched a new candidate-facing portal allowing physicians and hospital staff to apply and submit credentials directly to hiring managers. The company also brought its AI candidate matching engine live, transforming MarketWare from a relationship management tool into an AI-powered recruitment engine. This was part of more than 20 enhancements delivered in the quarter, with another 20+ including Workday and DocuSign integrations underway for next quarter.

For the complete transcript of the earnings call, please refer to the full earnings call transcript .