Cerner released its fourth-quarter and full-year earnings report this week, showing an increase in revenue but a decrease in net earnings in 2021.
In the financial release – the first following the announcement of its acquisition by Oracle this past year – Cerner leaders said its Q4 revenue underperformed projections to some degree.
“While revenue in the fourth quarter was slightly below expectations primarily due to a COVID-related project delay and lower technology resale, we had a solid fourth quarter driven by a sharper focus on our core business and better operational execution,” said Dr. David Feinberg, who took over as president and CEO in October 2021, in a statement.
WHY IT MATTERS
A spotlight has shown on Cerner since the news of its mammoth deal with Oracle went live in December 2021.
The vendor said in its earnings report that it expects the $95-per-share merger to close in this calendar year. Given that proposed acquisition, Cerner declined to host an earnings conference call, issue prepared remarks, provide financial guidance or repurchase shares.
Still, the report offers some key insights into the company’s progress over the past quarter.
For instance, its fourth-quarter revenue was $1.452 billion, up 4% compared to the same time period in 2020. Its GAAP diluted earnings per share was $.59, a 28% increase from fourth-quarter 2020, with an adjusted diluted EPS of $.93.
Meanwhile, the company’s yearly revenue also increased to $5.765 billion, up 5% from 2020, and its adjusted diluted EPS increased 18% to $3.35. GAAP diluted EPS, however, was down 27%, with net earnings also decreased compared to 2020.
At the same time, noted Chief Financial Officer Mark Erceg in a statement, “We repurchased $1.5 billion of shares at an average purchase price of $74.96, increased our quarterly dividend by 23% and successfully closed and integrated Kantar Health (now known as Cerner EnvizaSM) – which is pacing well ahead of its acquisition economics.”
THE LARGER TREND
The vendor has undergone major changes over 2021, to say the least – in addition to the hiring of Feinberg and the major proposed $28.3 billion deal with Oracle, Cerner has also recently launched a new revenue cycle tool, RevElate.
Customers in a recent KLAS report sounded off about these happenings, with many expressing cautious optimism.
“The Cerner RevElate direction makes sense, but I need to see Cerner deliver now,” said one customer quoted in the report. “I have seen poor code and broken products in Cerner Patient Accounting. I want to know whether those parts of Cerner’s delivery will be fixed in the new product.”
ON THE RECORD
“Cerner has been a trusted partner to healthcare organizations for over four decades, and our clients, caregivers and associates are energized by our focus on making the EHR more useful, usable and reliable,” said Feinberg in a statement.
“I’m also excited by how the pending acquisition by Oracle can accelerate our development work to help make care more proactive, accessible, equitable and dignified,” he added.
Kat Jercich is senior editor of Healthcare IT News.
Twitter: @kjercich
Email: [email protected]
Healthcare IT News is a HIMSS Media publication.
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