Huron Consulting Group Inc. (NASDAQ:HURN) Q2 2022 Earnings Conference Call July 28, 2022 5:00 PM ET

Company Participants

Jim Roth - Chief Executive Officer

John Kelly - Chief Financial Officer and Treasurer

Mark Hussey - President

Conference Call Participants

Tobey Sommer - Truist securities

Andrew Nicholas - William Blair

Bill Sutherland - Benchmark Company

Kevin Steinke - Barrington Research

Operator

Good afternoon, ladies and gentlemen. And welcome to Huron Consulting Group's webcast to discuss the financial results for the Second Quarter 2022. [Operator Instructions] As a reminder, this conference call is being recorded.

Before we begin, I would like to point all of you to the disclosure at the end of the company's news release for information about any forward-looking statements that may be made or discussed on this call. The news release is posted on Huron's website. Please review that information along with the filings with the SEC for a disclosure of factors that may impact subjects discussed in this afternoon's webcast. The company will be discussing one or more non-GAAP financial measures.

Please look at the earnings release and on Huron's website for all of the disclosures required by the SEC, including reconciliations to the most comparable GAAP numbers.

And now I would like to turn the call over to Jim Roth, Chief Executive Officer of Huron Consulting Group. Mr. Roth, please go ahead.

Jim Roth

Good afternoon, and welcome to Huron Consulting Group's Second Quarter 2022 Earnings Call. With me today are John Kelly, our Chief Financial Officer; and Mark Hussey, our President. In the second quarter, we continue to experience strong demand across three operating segments, enabling us to achieve 19% revenue growth over the prior year quarter and record quarterly revenues. Our Digital capability grew 47% over the prior year quarter, reflecting ongoing strong demand for our technology and analytics offering cross the healthcare, education and commercial industries. Despite uncertainties in the macro environment, we anticipate continued demand across all of our operating segments for the remainder of the year leading us to raise and narrow our full year revenue and earnings guidance.

I’ll now share some additional insights into our second quarter performance. During the second quarter, healthcare segment revenues grew 12% over the prior year quarter. The increase in revenues was driven by strong demand for our health system clients for our digital and revenue cycle managed services offerings. And digital capabilities revenues in health care grew 53% over the prior year quarter reflective of the ongoing demand for enhanced technology and analytics offerings across the provider industry. While many hospitals received Cares Act funding to help address the significant losses incurred during the pandemic, that federal support is now largely gone. What remains for many health systems and particularly academic medical centers are significantly higher labor costs, ongoing supply chain issues, and more recently, higher debt financing and capital costs.