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Good day, and welcome to the Semler Scientific First Quarter 2022 Financial Results Conference Call. All participants will be in listen-only mode. After today’s presentation, there will be an opportunity to ask questions. Please note this event is being recorded. Before we begin, Semler Scientific would like to remind you that this conference call may contain forward-looking statements. Such statements can be identified by words such as may, will, expect, anticipate, intend, estimate, or words with similar meanings, and such statements involve a number of risks and uncertainties that could cause Semler Scientific’s actual results to differ materially from those discussed here. These risks include continued uncertainty due to the ongoing COVID-19 pandemic, and more recently the Russian invasion of Ukraine, risks associated with Semler Scientific’s extension of QuantaFlo additional cardiovascular diseases and it's distribution of Insulin Insights as well as other risks associated with Semler Scientific’s business. Please note that these forward-looking statements reflect Semler Scientific’s opinion only as of the date of this presentation and it undertakes no obligation to revise or publicly release the results of any revision to these forward-looking statements in light of new information or future events. Please refer to Semler Scientific’s SEC filings for a more detailed description of the risk factors that may affect Semler Scientific’s results and these forward-looking statements. Now, I would like to introduce Doug Murphy-Chutorian, CEO of Semler Scientific.

Good afternoon, everyone and thank you for joining us for our first quarter 2022 results call. I’d like to introduce you to Dennis Rosenberg, our Chief Marketing Officer, who will begin the call for us today. Dennis?

Thanks, Doug. We're pleased to report that during the first quarter of 2022, the company's financial performance rebounded in the home testing market with higher volume of sequential revenues, which grew 67% compared to the fourth order of 2021. This was consistent with our expectations regarding the pattern of seasonality in this market and our thoughts about timing of orders by large insurance plans to our health risk assessment customers. Comparing results for the quarter ended March 31, 2022 to the corresponding period of 2021, the highlights are as follows. Revenues were higher by 6% increasing to $14 million. Net income was lower by 31% decreasing to $3.4 million. Cash at the end of the quarter was $38.4 million increasing by $11.9 million. We believe that the relatively slower growth in the period-to-period quarterly comparison was due at least in part to the COVID 19 pandemic and more specifically the highly contagious Omicron variant, which peaked in most parts of the United States in 2022 to date. Our staff and many of our customers and prospects experience the higher than normal rate of employee absence due to illness, which can have a slowing effect on our sales cycle. That being said, there were two significant milestones that we achieved so far this year that I would like to outline for you. Previously, we've described to you how some customers took years to study QuantaFlo before deciding to use it. We have noted that we funnel all the testing data through our servers and provided back to our customers in a confidential manner who in turn kept the data privately within their own organizations. Therefore few knew how powerful and clinically important the data actually were. Now a large customer has published the data underscoring, why they use QuantaFlo. We refer to this as the Nevada Paper, the big picture. The Nevada Paper quantifies risk of peripheral arterial disease, or PAD on death and other adverse outcomes. The Nevada Paper justifies screening asymptomatic patients in a Medicare advantage population using QuantaFlo, thus supporting why CMS pays extra so that these patients can be properly cared for. When the message permeates the medical community, we believe new customers might be attracted to use QuantaFlo. The second accomplishment through our internal development efforts, QuantaFlo can now be used as an aid to identify patients who would benefit from further evaluation for another underlying cardiovascular disease. While we are not disclosing this specific disease yet, we believe this extension of QuantaFlo may make it even more valuable to assist the medical com unity in the future, including Medicare advantage providers. We intend to sell this extension to our existing customer base and others as an upgrade to our software as a service business model. Other key points regarding this extension are, the unserved clinical problem may be as important as PAD. A peer reviewed publication of clinical data has been submitted and is under review. A medical aid performs the test in a primary care setting, similar to how one uses PAD for PAD and the technology is protected by trade secrets. Now Andy Weinstein, our Senior Vice President of Finance and Accounting will describe our financial performance in more detail. Andy?

Thanks, Dennis. Please refer to financial results described in the press release that was distributed at market close today. For the quarter ended March 31, 2022, compared to the corresponding period of 2021, revenue was $14 million, an increase of $800,000 or 6% from $13.2 million. Operate expenses, which includes cost of revenue with $10.1 million an increase of $2.1 million or 41% from $7.2 million. Net income was $3.4 million, a decrease of $1.5 million or 31% from $4.9 million. That income per share was $0.50 per basic share and $0.41 per diluted share, which compares to $0.73 per basic share and $0.60 per diluted share during the same period last year. For the quarter ended March 31, 2022, basic share count was $6,777,950 and the diluted share count was 8,116,456. Analyzing the expense categories in earnings for the first quarter of 2022, as the percentage of quarterly revenue, our cost of revenue was 7% of quarterly revenue. Engineering and product development expense was 8% of quarterly revenue. Sales and marketing expense was 33%, general and administrative expenses were 24% of quarterly revenue and net income was 24% of quarterly revenue. As of March 31, 2022 Semler had cashed $38.4 million, which represents an increase of $11.9 million compared to $26.5 million at March 31, 2021. Our stockholder's equity is $49.4 million as March 31,2022. On March 14 of this year, we announced the stock repurchase program of up to $20 million. We established this program because we are positive about the future for Semler. We expect to file our quarterly report on Form10-Q or around May 06, 2022 and this will include our cash flow statement and more discussion on our cash liquidity, as well as the purchases pursuant to our stock repurchase program. In the first quarter of 2022, our two largest customers comprised 35.4% and 31.7% of revenues respectively. In the first quarter of 2022, compared to the correspondent period of 2021, our sixth fee software license revenues were approximately $7.9 million, an increase of $700,000 or 10%. Variable fee software license revenues were approximately $5.8 million and increased $200,000 or 3%. Equipment and other sales were $300,000 in both periods. We believe a new pattern emerged during 2021 in the home testing market with higher volume of testing seen earlier in the year with the fee for test revenue. We believe this is due to a COVID 19 related timing change in the behavior of insurance plans when ordering QuantaFlo testing from our health risk assessment customers. However, this newly observed pattern may or may not continue in 2022 or in future years. Semler is given and financial guidance for the first time in its history. Because this is the initial guidance, we have not decided yet how often or when to update or what will we will be -- what we'll listen to in the future. That being said, we believe the second quarter revenue will range from $14.2 million to $15.2 million and operating expenses, which includes cost and revenue will range from $10 million to $10.5 million. We believe the annual revenue in 2022 will range from $58 million to $60 million and operating expenses, which includes cost and revenue will range from $44 million to $46 million. Now I will ask Dennis to continue the discussion and provide concluded remarks. Dennis?

Our R&D and business development goals are to continue to upgrade the existing product and data services to commercialize other internally developed services and products and to in license or distribute new services and products, which we believe can provide enhanced value to our customers. Also, we plan to share the Nevada Paper results with our established and prospective customers, details of which are as follows. In February, 2022, an independently conducted peer-reviewed study was reported that used QuantaFlo for prospectively screening for undetected and asymptomatic PAD in a Medicare advantage population with three-year follow-up. In this study, 13,971 patients were tested and 31.6% were found to have PAD. In positive PAD patients versus negative patients, there was an increased risk of 60% to 70% for all caused mortality or morbidity at one year and a 40% to 50% increased risk of all caused mortality or morbidity at three years. The author included that a positive screening result of previously undetected, lower extremity PAD was independently associated with short-term and long term increased risks for mortality and major adverse cardiovascular events, MACE in individuals aged 65 years and older living in a large metropolitan area. Furthermore, they added, a positive PAD screen with QuantaFlo flow has the potential for PAD risk management at the population level. Semler Scientific believes that this study supports the use of QuantaFlo and highlights the benefits that the product brings to our customers and the patients they care for. Thus, it may drive further adoption of QuantaFlo by existing and new customers. Overall, we believe annual revenue will continue to grow in 2022 because of increased numbers of installations of our product, more usage of our product and recurring revenue from the licensing businesses. Also, we have signed up several smaller customers for Insulin Insights, the new product that we are distributing. Insulin Insights is a software program that a healthcare provider can use to optimize outpatient insulin dosing of diabetic patients. If all goes well with the beta launch, we plan to market it to our established base of customers. We began invoicing for initial sales of product licensing to some of our customers in Q1 2022. Our goals continue to be, to make new additions to our customer base, expand orders from existing customers, introduce additional products to our customers and further establish our QuantaFlo product as a standard of care in the industry. In 2022, Semler Scientific expects continued profitability and generation of cash from operating activities. At the end of first quarter 2022, headcount was 122 employees compared to 124 employees at the end of fourth quarter 2021. Operating expenses are expected to increase from current levels due to wage inflation pressure in the employment market and our continuing desire to build infrastructure to support new business opportunities. We believe that the market for vascular disease testing is larger than our current market penetration. So there is room for continued growth. We continue to invest in R&D with the goals of providing innovative products that enhance value to our customers now, and in the future. The beginning of 2022 portends a record year for our company in terms of revenues and cash position. There were two significant milestones we achieved so far this year that I outlined for you earlier on this call. Number one, the Nevada Paper, which may further drive adoption of QuantaFlo by existing and new customers and two, the enhanced value proposition of QuantaFlo for our current customers for another cardiovascular disease. Accordingly, we are optimistic for our future. Thank you for your interest in the company and your continuing support. Now operator, please open the lines. Doug, Andrew, and I will be happy to address your questions.

Thank you, Brooks. Thank you.

The next question comes from Marc Wiesenberger with B. Riley Securities, Inc. Please go ahead.

Thanks. Good afternoon. Appreciate you taking my questions. If you could talk about the data from the Nevada Paper and specifically how that has maybe helped evolve some of your conversations with existing or new customers and kind of any specifics there would be helpful.

Sure. Well, the publication of the data is still fairly new, just a month or two. So it'll take time for this to disseminate out into the marketplace, but that's going to be a focus of our sales and marketing activities through this year and on into future years. This is a large and important study independently conducted that really underscores quite dramatically the benefits of PAD testing with QuantaFlo. So we think it's going to have an impact in the market. It's still early as they say, it's only a month or two too old, but it certainly will be part of all the conversations we are having with customers and prospects going forward.

Okay, fair enough. Based on the guide, it actually looks like the second half of the year is going to be stronger than the first half, which seems a little different than obviously the recent comment we've heard previously about seasonality. So wondering if you could unpack that a little bit, and then you talked about some billing for Insulin Insights. I'm wondering should, how much of that is baked into the full year guide?

So maybe Andy, you can cover the guidance question specific, but in terms of Insulin Insights, we would anticipate not a material amount of revenue from this year, although that could pick up. We just have to see the progress of the beta launch and the adoption by customers and these things. So, we're just going to have to see as the year progresses. It's, why we have a range in there in terms of the guidance and then Andy, you may want to cover what Marc was asking as far as the specifics of the year.

Yeah. We do see it, we do see increases. We think that both fee for test on license fee revenue will continue to increase during the year. So it is baked that there will continue to be increases. We don't see anything slowing down and we could see quarters, the future quarters being better than the first quarter, or as good as the first quarter. And I think on both sides of the business, things are going to increase. Also, I do agree with Dennis that there is not a lot baked in for the new products. Hopefully we will, but that is again why we have the range.

Okay. And it looks like this might be the best or pretty close to the best gross margin for the company. If you could talk about those dynamics and how sustainable is this level moving throughout the year?

We don't anticipate pressure in terms of that for the year. We'll have to see how things, but we feel as though that's a pretty solid number.

Okay. When we're thinking about the new application for QuantaFlo, how should we think about the target patient population relative to that for QuantaFlo being used for PAD?

Well, as we said in the text, this may be as important or more important a market ultimately. Obviously this will be a lot easier to discuss in detail once we're talking more specifically about the application for this, which should be an upcoming quarters, but we do believe, this is a significant market and can definitely play a role in expanding the value proposition for QuantaFlo. So we're enthusiastic about what the future holds for this. It should be a major market as long as things pan out as we expect.

Okay. Looking at the share count from the 10-K that was filed at the end of February, and then the count that was in the release today, it actually doesn't look like you bought back any shares since the buyback was announced. Just want to confirm that and then maybe understand how you view deploying the capital for that purpose?

And do you want to take that or Doug.

Yeah, you are correct that there was not -- there was not significant repurchases that will be addressed in the Form 10 Q when we filed that a little bit later this week, but your assumption is accurate.

Okay. And just, maybe just talk about the thought process on how you're going to look to deploy that considering you said that you kind of thought shares were depressed and it's a pretty bright outlook. It would seem like maybe it's an opportune time to deploy that.

We haven't made any decisions about that yet. But we try to make the shareholders decisions in the shareholders’ interest.

Understood. Okay. Thank you very much. Appreciate it.

This concludes our question-and-answer session. I would like to turn the conference back over to Dennis Rosenberg for any closing remarks.

Thank you for joining us and we look forward to updating you soon on our continued progress.