GoodRx stock rises on Q4 earnings, announces buyback program

Shares of GoodRx Holdings (GDRX) are jumping Thursday as the company posted its fourth quarter earnings, revealing revenue increased by 7% to $196.6 million. The company also issued full-year guidance for 2024 that beat Wall Street expectations. These developments come after the company announced a new stock buyback program valued at $450 million.

GoodRx CEO Scott Wagner joins the Live show alongside Yahoo Finance Reporter Anjalee Khemlani to discuss the company's initiatives with retail pharmacy and insurance partners.

Wagner explains how GoodRx fits into the rush of industry innovation, particularly around AI: "We're working really closely with...not just our retail pharmacy counter partners but the industry in general to really add tech benefit to the flow of a prescription, which is all designed around people, patients, which, how do I not only get that prescription medication but have the right point of affordability? So, there's connection from your doctor's office to the flow of the script to your, frankly, insurance plan to retail. That's one of the big things and big advantages that we provide. Relative to AI, there's a heck of a lot of immediate opportunity in that pricing benefit that we're already working on and leading the industry on."

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Editor's note: This article was written by Nicholas Jacobino

Video Transcript

SEANA SMITH: GoodRx popping today after reporting a fourth quarter revenue beat and Q1 and full-year guidance that beat the Street's expectations. Now, the telehealth platform also announcing a new buyback program of up to $450 million in common stock. Yahoo Finance's Anjalee Khemlani joining us now with the CEO of GoodRx. Anj.

ANJALEE KHEMLANI: That's right. We have with us Scott Wagner, CEO of GoodRx. Scott, thank you so much for joining us today.

Really a strong quarter and a strong full-year earnings. Up $750 million for the year, that's pretty good. You're on your way to a billion there slowly but surely. But despite that revenue growth, you still reported net loss and that is, of course, where the mixed earnings comes in despite this beat and the investor sort of optimism there. What can you tell us about the balance of both?

SCOTT WAGNER: Anjalee, hey. Thanks for having me. It's great to be with you.

Well, first, I and we were really pleased with the results. Revenue was up 7%. EBITDA was up 15%. And importantly, the business is cash flow positive. So we make money and all those financial measures are going in the right direction.

And the best thing about all that is they're reflective of the work we've been doing over the last year to continue to fulfill our mission, which is to provide Americans with prescription medication that they can afford. A billion prescriptions a year, that's a billion with a B, get left at the pharmacy counter due to price. And GoodRx is really the way that people can get access to medication they need at a price they can afford.

ANJALEE KHEMLANI: That's right. And talk to me about the outlook. I know there were some hits that you took towards the end of last year, resulting in that net loss. What are you looking at for the upcoming year in order to sort of regain some of that momentum?

SCOTT WAGNER: Well, I think the nice thing and I'd say it as continue the momentum that we're actually on. And we're really doing three things right now for the company, the first of which is working with our retail pharmacy partners, Walgreens, CVS, Walmart, et cetera, to help them manage their own category. One good example of that is Walgreens in the fourth quarter during cold and flu season, we took a basket of cold and flu medication and together with Walgreens delivered 40% to 50% savings on this basket of drugs, merchandised them.

And guess what? Walgreens got a ton of incremental activity in traffic. And so theme one is working with our retail pharmacy partners to continue to manage their category.

The second thing, and this is interesting and has I think a lot of runway to it, is having the GoodRx benefit work with insurance. So the product is called Integrated Savings and with a couple of PBM partners. When you deliver your insurance card to the pharmacy counter, you check your insurance co-pay price and the GoodRx benefit and you automatically get the lowest price. There's a huge amount of trajectory there and bringing what's a benefit of GoodRx against traditional insurance that we think has a lot of runway. And the third thing we're doing is working with brand medication to deliver GoodRx savings at the point of sale all of which have a ton of opportunity.

ANJALEE KHEMLANI: Absolutely, yeah. The Shared Savings Program really an interesting way to sort of integrate and make it less painful for the consumer to have to do all the legwork there. Great buy in. And at a time where we know that pharmacies are sort of hurting when it comes to sales of prescriptions pushing into mail order and the like, talk to me about how you think about the technology overlay on that and in a world where we're talking about AI and how the company is looking at sort of this rush of innovation right now.

SCOTT WAGNER: Yeah, thank you. That's a great question. I think the first part of it is we're working really closely with and for not just our retail pharmacy counter partners, but the industry in general to really add tech benefit to the flow of a prescription, which is all designed around people, patients, which how do I not only get that prescription medication but have the right point of affordability? And so there's connection from your doctor's office to the flow of the script to your frankly insurance plan to retail. That's one of the big things and big advantages that we provide.

Relative to AI, there's a heck of a lot of immediate opportunity in that pricing benefit that we're already working on and leading the industry on. And kind of like what Tom Siebel just said a few minutes ago, there's a lot of runway here. And we're kind of at the forefront of health care pricing particularly to allow that benefit to work its way into the hands of people.

ANJALEE KHEMLANI: Yeah, one of the things that GoodRx has done over the years is have these partnerships with different providers, with different pharmacies. I wonder now that you're working as a tech platform how that changes, the potential up and downs that you see with loss of contracts, and now that you're integrated how that changes the potential runway for the company.

SCOTT WAGNER: Yeah, thanks. I think what that reflects is having our relationship with Walgreens, CVS, Walmart not just be based on a contract, which is here's certain price points of drugs, but more importantly, how we can manage that on a real time basis to have a retail pharmacy, like my Walgreens example earlier on cold and flu, reach a bunch of goals. And so I'd say we are at the very early days of being fluid, fast, and flexible to work with retailers to provide benefit to their customers.

ANJALEE KHEMLANI: Certainly a good time to be in on data collection and data processing. GoodRx CEO Scott Wagner, thank you so much for joining today.

SCOTT WAGNER: Thanks for having me. Really appreciate it.