Good morning, and welcome to our presentation of the third quarter. We will start with me giving a company update. Then Svein-Martin will take over to give a financial update. Just a brief view of our history, where you can see a strong record of growth with small churn. Going into the third quarter and the highlights of the third quarter, we continue to have strong sales. This quarter, we are especially happy about bringing Falck Norge on board. Occupational health is an area which we believe strongly in, and that we have a good position to grow. There are many large occupational healthcare providers which we aim to grow with.
Also, Ad Curis has done good work bringing on Frelsesarmeen in Norway. We continue to have good sales on our AI assistant, Medsum, but I will come back to that. Also, our recent acquisition, Infosolutions, is developing very well.
If it is going according to plan, Infosolutions will next year be among our top companies when it comes to rule of 40, so that means growth and profit margin. That acquisition is going very well, and I think the management is doing a great job in that part of our business. Germany is now entering a new phase. I will come back to that. We now are setting up to rapidly start selling our new product, but I will come back to that. Looking at growth, we are at 29%. The organic ARR growth is at 14%, and the 12% organic revenue growth is a bit lower, and it has a lot to do with Germany, which I will come back to. We have an EBITDA of SEK 21 million in the quarter and a margin of 20%.
If I start with Medsum, that is our AI system that we build into our softwares. What it does at the moment is that it listens in on the conversation between the caregivers or the doctor, or physiotherapist, or so, and the patient. It automatically proposes clinical notes based on that conversation. It saves really a lot of time for the caregiver, freeing up time to see more patients. We are now close to 400 active users at the end of September. We have 300 paying users, so it is growing quite rapidly. What is really fun to see is that the customers really like this functionality. I think all of us use different types of software where they kind of build in AI systems that does not really do anything useful.
Doctors, nurses, physiotherapists, they have a lot of administrative tasks to do around each and every patient they meet every day. They are spending a lot of time doing quite basic documentation, which we now can do for them. It really saves them a lot of time, and they really love this type of functionality. We have very limited churn on the product, so that is also good. We will now soon launch more functionality and we also updated the entire UX. To have the AI even more embedded into the experience and make sure that it is one experience, the UX and AI. I will show you some pictures of that within short. We are doing an MDR certification, so Läkemedelsverket, the governing body in Sweden for this type of products, has said that this type of solutions need to be certified according to MDR.
That's quite a big project because it's Class 2a, which means that we're spending a couple of million in Q4 to get it done. We're already spending a lot of time preparing all the documentation and doing tests and verifying different types of scenarios. That's an important project going on this year. It does take some time, make it slower to get other functionality out, but over time it will help us, because there will be fewer ambient scribes on the market because of this type of regulation. We are also allowed off the redundant to do much more than we do today. That will really be good. In general, in the rollout of the AI assistant in our softwares, the aim now is to get as many early adopters in different clinics to start using it.
Most customers, when we have a new customer, a customer for us is usually it's one organization. One customer can be one clinic, or it can be like Capio, or it can be Aleris, and so on. What we're aiming for at the moment is to get many early adopters to start to use it in different clinics. One or two users in each clinic is what we're aiming for, so that they then can spread the word to all the other ones working in those clinics. This is really about getting people to start using it, to see that it's really useful. Many are a bit skeptical, and also healthcare is a really slow market. I've never seen technology spread very quickly in this market, and this is the quickest I've seen, I must say, in all my years in this sector.
We're really trying to get many users start testing it in different clinics so they can talk to their colleagues, and we will then grow within each clinic, each customer, and also with new customers over time. Yes, looking a little bit what we're doing. This is from Webdoc. It's our largest product. Sorry for the Swedish, but it's a Swedish product, so it says main content on the left. That's where you will We're looking at the medical records or we're looking at calendar or whatever. Here on the right is the assistant as it works today. It doesn't look exactly like this. This is how it will look by around Christmas. But it works like this today. You're recording the meeting with the patient, or you can also do what the second one is there, dictate.
You can, after the patient has left, you can add some more notes just with speaking them out. Or you can only do dictation if you want to and just talk to Webdoc, and it will propose a medical note like you used to do with the medical secretary. What's coming next is this functionality. While you're talking to the patient, we will look at everything that all administrative tasks you will have to do after the patient has left. Here I'm talking with the patient that has pain in the foot. The first one there, and sorry for Swedish again, it's a note to Försäkringskassan. That's this patient is going to go on sick leave. Then the doctor has to fill out a really long form.
There's a lot of text there, and if you don't do it properly, the Försäkringskassan will send it back to you, and you have to do it again, and so on. You really want to do that well, but it's really not a fun task, and it takes a lot of time. Here we have caught from the conversation that they're going to do that the doctor has told the patient that, I will put you on sick leave. Then he has said to the patient, we will book a revisit in four weeks, and I will also send a referral to orthopedic surgeon, and I will write some medicine for you, naproxen. All of these things popped up here, and that's the easy part. What we also will do is that we will pre-fill all these things.
After a visit or during a visit if you want to, this pops up as you talk. You can click on these things, and it will take you to the right place in the system and with basically everything you need already filled in, except for medication because we're not allowed to do that here. We can do certain things but not everything. This will really save a lot of time for them, making sure that you just go to the right place at the right time. Everything is pre-filled. Our aim is also that you shouldn't even have to wait for their LLM model to work because we can do this in the background, while you say goodbye to the patient. This, I think will really add a lot of value.
We've been discussing it a lot with our customers, and this is the functionality they want to see and the type of work they want to offload. This is coming around Christmas, and then it will help grow sales even more. We will not increase the price. The price will stay where it is at roughly SEK 750 per user and month. Looking at Germany, it has been going a bit slower than we expected to bring Webcur, our new system, to the market. Even with AI, it still takes a lot of time to really make a software which fits the user's needs. But we're getting there. Pilots are happy. The customers we show it to are happy. We're now preparing to push it really into the market.
There's been one big project that's been holding it back somewhat, and that's been the reporting of public patients, but that's almost done now also. Now we're really setting up to push it. But in the meantime, until this, you can see that we have churn in Germany, quite big. It's only with the old product, and it's usually the doctors retiring, and the one taking over the clinic wants to see a new system than the old system of Data-AL. That's why we have quite a big churn. It's a large part of the churn for the entire group. The churn in the Nordics is really low. As you can see, also the organic revenue growth, in the group, if you take Germany out of this, is 15%, and the EBITDA margin of the group is 25% without Germany.
Why we really believe in Germany, it is a really large market. Most customers are on really old on-prem solutions. Nothing close to what we have. Why we acquired Data-AL was to really get an organization in place which we can build upon. It is really hard making greenfield with a startup in a new country. I think that is really unwise to do. It is important to have something to build upon. That is why we acquired Data-AL. Now to really have this push into the market, we have a new CEO in place since September. He has a strong background in sales and marketing within this sector. We have also replaced parts of the sales team and also added new salespeople and also changed the product management team to really increase the speed and get to the market quickly. We will really start pushing this now in Q4.
It will mean in the short term that our costs go up somewhat. We believe strongly in both the product and the market. The last point on this slide is a bit interesting. I mentioned this, the churn we have on the Data-AL old product. As you all know, our plan was to close that product down eventually and to try to move as many of them as possible to our new product once the new product has all the functionality that the old one has. With the help of, now that we have such high speed in development, and especially since Data-AL is a product we already have, it is quite easy to work with AI on it to modernize it. We are doing also push to modernize that product to decrease churn, and possibly to keep that product alive. We will see.
It is a bit early days if we go on pilot thing now, but when you have the entire in the code, we basically have all the answers to what the customers want and which has been tested together with the customers over many years. It is a good foundation for actually modernizing a product with the help of AI. Looking forward, we will continue to grow strongly, especially in Nordic, we already do, and we will pick up the pace in Germany. We continue to have strong cost control, make sure that a large part of the growth falls down to the bottom line, and we are pushing Webcur into the market. We look forward to Q4 and next year. With those words, I will hand over to Svein-Martin.
Thank you. From the financial side, the Q3 came in strongly. Growth was maintained at a good level, and margins continued to improve on the EBITDA side. We basically continued to deliver on our plan of profitable growth. As you see here, contracted ARR was SEK 424 million at the end of the quarter where SEK 8 million was signed, not implemented contracts. It grew 14% organically. Infosolutions also added a bit more than SEK 40 million of ARR. Infosolutions has developed very strongly, as Daniel mentioned, both good underlying organic growth, and now after the cost savings, good profitability. We do the price increases by New Year. In the plans for next year, it will be one of the top performing products in the group from a rule of 40 perspective, which is very positive. EBITDA margin 25%, EBITDAC 20%.
We keep converting most of the extra revenue into profits. We also had a net retention of 110%, which is in line with what we normally see. Looking at the P&L, our revenues grew from SEK 82 million to SEK 108 million, 12% organic growth. You see here that on the revenue categories consulting more than doubled, and that is mainly because Infosolutions has a bit of a different revenue mix than the other parts of the group. Gross margins was slightly diluted from 85% to 84%. The cost base increased a bit on the personnel and OpEx side. This is mainly driven by the addition of Infosolutions and also by lower degree of capitalization than we had the previous year. But on the EBITDA side, which is the metric we focus on the profitability, it improved from 15% margin to 20%, which was a growth of 75%.
There was no one-offs this quarter either. The last point five there on the slide, I want to spend a couple of minutes on. Q3 is seasonally our strongest quarter on the margin side because personnel cost is lower because of the holidays. Revenues are also a bit lower, but in total, the effect is positive on the margins, which, of course, does not carry into Q4, where the cost and revenues normalize. We also will have some extra costs in Q4 related to the MDR certification of Medsum, and that we are stepping up the sales and marketing in Germany. Also, it is important to bear in mind when we compare to Q4 last year, it was a very special quarter.
To repeat what I said on that conference call in Q4, we had very high consulting revenues, including a big one-off revenue in Germany, and the positive one-off effect on the cost side related to the SkatteFUNN grant that reduced cost. I said already on that call last year that it is not something that comes regularly, and these effects will not come back in Q4 this year. So the improvements that we see here in Q3 will be smaller in Q4, and Q4 will have a lot of noise in the comparison. But it is important to note that most of this is temporary, and the underlying trend here is the one that we see in this quarter, and that does not change. From Q1 next year, again, the comparison is more clean, and the temporary cost has been taken.
We will get back to the big improvements that we have seen over the last few years. The ARR bridge, where we see the growth there is more or less in line with what we are used to. The net upsell is strong, 13%, SEK 42 million. This is driven by the same factors as normally. We add more clinics and at existing customers, our customers have volume growth, and we also sell new modules. It is worth mentioning that Volvat or Capio Norway is an important contributor to this bucket, given that it was onboarded during Q4 last year. It was also a major part of the backlog that you saw there in Q3 last year. Medsum is also starting to show up here with now SEK 3 million in ARR and will be an important driver going forward. Next bucket there, churn SEK 9 million, 3% or 2.8%.
The Nordics is still below 2%, so the German business is contributing a lot to that churn, unfortunately. Then we have new customer sales of 13 million, taking the organic growth to 14% for the group and 15% in the Nordics isolated. You see that the backlog is now 8 million. That was 6 in Q2, so it has grown quite a bit. We did have a very large backlog compared to normal for Webdoc in Q2. Part of that backlog we have kept because there is fewer implementations during the summer. Then we have also added this big contract that Daniel mentioned for Falck and Frelsesarmeen. Q3, as it was in Q2, Q3 was also a very strong quarter, actually, on the sales side for the group. The scalability slide shows our focus and how the business works.
You see that over time, revenues has grown from SEK 245 million to SEK 390 million. It is partly due to acquisitions, but also a very strong organic growth. Then the costs you see below there on the organic side has been basically flat over this period. In the same period, we have had an EBITDA improvement of around SEK 100 million. This is because we have been able to keep that dark blue part flat. We have taken on costs many places, such as AI costs and different roles, but taken out cost on other places. This is a very important part of that we have been able to increase our profits so rapidly.
Finally, on the cash flow, the third quarter is seasonally weak on the working capital side. You see here that the change in working capital was SEK -22 million this year, SEK -21 million last year.
It is because we pay out holiday salaries, and we do not have any big annual invoicing in this quarter. Operational cash flow was SEK 5 million, but in the year-to-date figures, you see a better picture of the working capital model that we have. There is the operational cash flow, SEK 74 million, and free cash flow after CapEx is SEK 48 million. It is also quite a bit higher than the EBITDA, because the working capital is supportive as we charge upfront in the majority of the cases and pay invoices after the period.
A very strong cash flow so far this year. On the capital allocation, we did not have share buybacks this quarter, but we have repurchased SEK 40 million in the beginning of the year, and the cash position remains at SEK 47 million . That was all from me, and let us open up for questions.
If you wish to ask a question, please dial pound key five on your telephone keypad to enter the queue. If you wish to withdraw your question, please dial pound key six on your telephone keypad. The next question comes from Fredrik Nilsson from Redeye. Please go ahead.
Thank you. Good morning, Daniel and Svein- Martin.
Good morning.
Good morning.
Regarding Germany and the initiatives to mitigate churn in Data-AL, should we view that as mainly a short-term initiative or is there a potential for a long-term shift in strategy in Germany?
Yeah. I think there might be potential for long-term shift. I think in these times, it's important to stay flexible and nimble, not to get stuck in plans. It has nothing to do with our beliefs in Webcur. It's unchanged, but it's our belief that we can do so much more with our software now, and we know that it's so difficult to get customers to change. So if we can renew their present product, then that will really make it much easier to just keep the customer and start growing with them. So we're testing it. We'll see if it works. It seems promising.
Because the most difficult part with developing software, and it has always been, it is not really to write the code, it is to really understand the customer's need, show them what you have done, really change after you talk to them, understand what the different integrators need, understand what the public need, the regulation need. All these needs adds up to one software, so to speak, and all those needs is what makes it quite difficult to develop a new software. That is why Webcur is not moving according to plan, really.
It is a bit after. But in a product that you already have, you have solved all those needs. The problem used to be that if you have solved all those needs and then the technology gets outdated, there is no way to take all that code and just start transferring it to a new language. It would take so many years.
You do not do that typically. But now with AI, there is potential to renew legacy products much quicker, in a way that was not possible before because you have all those needs described in that code, and you have solved all those parts. So you just need to move the code from one language and one architecture to another. So that is what we are testing. I am not saying that what we will do with strategy-wise, but I think it is worth mentioning. I think it has the potential to lower the churn in Germany and potentially to shift, and maybe we will have two products. It is not as difficult to have two products as it used to be either. Did that answer your question, Fredrik?
Yeah, I think it was a clear answer. Thank you. And obviously you have an impressive pace in the Medsum area currently. Could you share your expectations for next year? Do you think you can accelerate the pace in net new users in absolute terms further?
Yeah. So, I am very close to this product, so I am extremely optimistic about it. But I think that healthcare is really slow. So I mentioned this many times, and I think it is worth mentioning again. So all the doctors and nurses, and we launched this in Sweden, so remember that, but this goes for large part of Europe. All the doctors, nurses, physiotherapists, they are educated in the public system. They have lived large part of their lives in the public system before going private. So they work in an environment that has had very little change. They are working basically the same way as they did 20 years ago, and this means that that is what they are used to, very little change. They also are trained not to make mistakes. You can be reported if you make a mistake.
You can lose your license to actually give care as a person, as a doctor or a nurse, if you commit mistakes. Healthcare is very slow to change by nature, and that might be good in certain ways, but when driving a new technology, that's really a hinder. I expect over time that it will be a really big product. If you look at the U.S., to me, most statistics looks like 70%-80% of all outpatient visits in the U.S. use ambient scribes. In the U.S., you have much more commercial healthcare, so it's much more pushed towards efficiency, and you have much, much less regulation. You can just give the customer this type of functionality. In Europe, it's obviously moving way slower.
I think that our expectation is that today, 5%-10% of our users use this type of technology, either from us or from a competitor, or a partner in some cases. I think it will not go as quickly as it should because this saves so much time. When we talk to users, they already now say they save one hour per day, or they save half of their administration, these type of things they say. With the new functionality that we have coming out, with even better integration into the software, we'll save even more time and make the user experience even better. It can go quite quickly, but we don't see it yet, I would say. Over time, I think this will be used by most users in our software.
I see. Great. Could you give us an update about your progression in Region Stockholm? Is the solid momentum still there, and could a potentially less left-leaning new regional government be a positive factor going forward?
Can it be a, did you say positive factor or less left than Okay, sorry.
Yeah, exactly.
Yeah. Region Stockholm is moving forward well. We have finalized e-referrals going in, so we have a number of clinics that started during the summer, which has our e-referral solution. Referrals going out, we'll do end-to-end tests, I think next week it is. Then we can launch also that to our customers. Stockholm is going well. It's, as you know, by far the largest market. If the new region will be less left-leaning then yeah, it will probably be positive. But I think it's likely because the region will be dependent on Centerpartiet, and what they've done so far, this coalition has not worked very well. So I think that they've destroyed quite a lot of well-functioning private care. So I think that has probably come to an end. I think they feel that themselves actually.
Usually when a region changes party color, I've been in this industry since 2006. Usually when you change color, it doesn't really change that much for the caregiver. It's just usually a lot of talk before election and then nothing happens. The right usually do a little more reforms and the left kind of don't care about the private providers usually. After the last election, so the last four years, Stockholm has behaved a bit differently. I think it's because all the politicians on the left side, almost all of them were new. So they hadn't been in power before because it was eight years since the last time. So I think that's why they did kind of a lot of naive things, which I don't think they will repeat. But they will have the same language before the election, and also after, as they usually have.
Usually very little happens, and I expect that to be the case when it comes to changes for private care providers.
Okay, I see. One last question from me. Could you give us an update on the surgery offering?
Yeah. Surgery is a great module. We are showing it to a lot of potential customers at the moment. We also have a lot of customers using it. Those are still the really big customers, so it is quite a long process to convince them to change. We are in a number of them. So far this year in Webdoc, we have had quite a few really big units changing to Webdoc. We have a large number of small ones and small startups and so on, and then we grow with them, so that is kind of fine. We are looking forward to get some bigger ones also into our books. It is well-functioning, it is well-appreciated by users who use it, and we will continue to grow with that functionality.
I see. That is all. Thank you very much.
Thank you.
The next question comes from Elvin Rolder from DNB Carnegie. Please go ahead.
Yes. Good morning, Daniel and Martin. I hope you are well. I have a couple of questions from my side as well. Perhaps beginning with Webdoc and the kind of AI-integrated workflow. Can you tell us a little how these features have been received in pilots? Is this something you expect to gain kind of broad-based usage amongst clinics? Will it's kind of like similar to Medsum in the beginning, be more of early adopters before gaining the bigger end of the tail? Then I do not know if it was my line that was bad, but I believe you mentioned price. Can you just reiterate what you said, the economics behind it? Will it be an increase in price based on this, or will you kind of more bake in these feature upgrades into kind of yearly price adjustments?
Yeah. This functionality, the new ones where we have multiple agent loops, looking into the conversation and finding actions, and then from the actions we trigger, for example, the sick leave note and so on. That functionality is not on pilot yet. I think we will just pilot it for like a week and then we bring it out because it works well in our internal testing, and we have done the really messy part with doing the medical notes. The medical notes are difficult because every one of our users or many of our users use completely different structures, and they use different words. If they have a field called status, for example, it is very different what each user want to have in that field, but they want to have it their way. The normal thing we do is really messy.
For each user, the system, it is not training, but the system learns how that user want their medical notes. When it comes to sick leaves and the other things, they just want it to pass Försäkringskassan. So we expect that to be so much easier. We will just add those functions as we go. We will also add normal speech-to-text in the entire system. We will just add functions. So far, the costs for this type of solutions are a bit higher than in the normal case, but they are still not high. So we have good margins on the product. We charge SEK 750 per user a month, and we aim to continue to charge SEK 750 per user even with the new functionality, and it will be included. So we use these new features to drive up demand.
It will be really like you have your personal secretary doing everything for you, and it will be much quicker than if you use your secretary. We will just use it to grow quicker because SEK 750 per user almost doubles our revenue per user on average. It is a great business for us to add this functionality. We just want it to spread quickly with using quite a lot of costs to just get it out there. We just want as many clinics as possible to test it. It does not have to be many users in each clinic, but many clinics to test it. We prefer actually there is maybe one or two who really are interested in it, and then they can kind of spread the word internally.
Because usually the ones that start using it, they get very positive and then they bring the others on board. At the moment, our focus on sales list is just to talk to as many clinics as possible to start getting one test user, so to speak.
Okay, perfect. Thank you. Maybe moving on a bit to Germany, and I guess related to what you are mentioning on the modernization potential for the legacy Data-AL products. Is this something that you are also seeing more incumbents in Germany also pursuing, given that they are able to use AI to modernize their products? Or are they still lagging in the do you expect their products to be better and perhaps that new customer sales for Webcur could become a bit more difficult than perhaps initially perceived if they are able to modernize the products? Or how do you view that?
Yeah. That is really interesting. I think that is why we need to keep a very open mind because what we have been worrying the last couple of years about is that AI will make it easier for someone to launch completely new products and compete with us, for example. That is why we have done acquisitions to strengthen our position. We have increased development phase so that we kind of keep the same distance between the competition and us. Then we have seen it mostly as a gain as we start moving much, much faster than before, and we are moving much faster than before. To compete the larger legacy systems, as of yet, they still are not really moving as we see it. That is how we have been looking at it so far.
Now, given that customers really don't like to change, that's a potential that we'll see that older software can be modernized much, much more cheaply. It used to be that you let them die. I think that if you've gone too far down that route, it might be difficult to turn back. There is a risk for that. It also seems to me like the really big players with legacy systems don't really seem to get going, as of yet, at least. We'll see. As they could say, I think that what we will see in general is that demands on software will be much, much higher than before.
Complex software as we sell with a lot of functionality and where users have a lot of different wishes, means that we will need to have our software much more adapted to each user's and each customer's needs. I think that in a couple of years, our softwares will look very different depending on what type of users you are, what type of care you give, and so on. That's where I expect it to go. I think that our customers are fine spending 1%-2% of their revenue on EHR systems, and if we can help them help more patients, it really pays for itself. I expect a lot of the pain to disappear in healthcare, thanks to systems like ours going forward in a much higher pace.
I think it's very important that we stay nimble, open to not get stuck in strategies, and take the opportunities that are out there now.
Great. Thank you. The final question from me perhaps relating a bit to costs. I believe in Q2 you mentioned SEK 2 million in MDR costs during H2. Has any of that been affected here in Q3, or will all of that, or another amount if that has come in Q4? Can you give perhaps some color on the degree of costs for kind of the increased sales and marketing in Germany?
Yes. So related to the MDR, we have done some preparatory work in Q3, but the far majority of the cost will come in next quarter. Then on the sales and marketing side, it is a mix. We have added quite a few salespeople, three, four salespeople that did not really have effect on the costs in this quarter, but will have in the next. Then we also do some more one-off related initiatives that will drive costs. So in total, around SEK 3 million-SEK 4 million extra cost in the quarter compared to this one, I would say.
Okay, great. Thank you so much, guys. I will get back in the queue.
Sure.
As a reminder, if you wish to ask a question, please dial pound key five on your telephone keypad. The next question comes from Viktor Lindström from SB1 Markets. Please go ahead.
Hi, Daniel and Martin, and thanks for taking my questions. I have a few ones. So starting out on the contribution from new sales to organic ARR growth here, a bit lower compared to previous quarters, but I would say that this is most like a timing effect given the contracted ARR backlog.
Yes, it's a mix. It's a bit due to the We had a few large new customers start Q3 last year, so they drop out. Then we have had big new contracts such as I mentioned, Volvat, for example, that gets put in the upsell bucket because we had a very small part of their business from before. So I would say that the sales has been very strong so far this year, both in Q2 and Q3, particularly. But I would say it's a bit of a categorization as well, given that we sign a lot of clinics that we have an existing customer relationship with in the chain or the group. So that's the main reason I would say.
Okay. Apart from the new Falck contract, do you expect the majority of the backlog to be implemented by Q4? Or should we expect that to have a larger contribution in 2027 instead?
Yeah. The backlog is mainly composed of Falck, Frelsesarmeen, and Webdoc customers. The plan is to implement I think almost all the Webdoc part within this year. But then the Falck and Frelsesarmeen will be Falck will be next year, and Frelsesarmeen will be a bit this year and a bit next year. So the majority of the backlog will be implemented in Q4.
Right. Thanks. I have a question on the gross margin. It was slightly higher than in Q2, despite that Infosolutions contributed with only one month. So I'm curious, could you quantify the gross margin that Infosolutions currently operate at?
Yes. They have a gross margin that is around 70% approximately. A bit lower than the group, but then we also have Infosolutions had quite some revenues from Webdoc, which now after we consolidate them in, that revenue is eliminated from revenues from Infosolutions and COGS on Webdoc. That has a positive effect on the margin, so it does not dilute that much.
All right. I guess, with the coming price hikes, we will also see additional support from there.
Yes.
Yeah.
It is important to note on the price increases there on Infosolutions, we do it on, like we said in Q2, we do it on the ARR. Infosolutions has a bit higher non-recurring revenues than the rest of the group, and there we do not see the price increase.
Yeah. I see.
Yeah.
Yeah. All right. Thanks. That was all for me.
Thank you.
There are no more phone questions at this time, so I hand the conference back to the speakers for any written questions and closing comments.
Okay. We have a few questionnaires in the chat. First one from Marcus Van Bag. What is the percentage of users paying for the AI functions at present out of the total users? Yeah, so as we illustrated on the slide, we only have about 300 users paying for it to date. We do have in the EHR systems, we have a lot of users, maybe around 30,000active user- 40,000 active users in total. So the potential is big, but of course, not all of them will use this functionality, but there is potential to keep. There is quite a few of them that are using these type of solutions so far. Then from Jakob Gravdal, "Can you share some more on the customer perspective of Medsum? What is the quality of the transcripts now compared to the first-generation products you implemented?
When you look at cost savings for your customers, what is the payback time for your average client?
Yeah. The first generation of Medsum, we tried to avoid being in U.S.-owned clouds, even if they were in Europe. We used open-source models. At that point in time, we could not get the quality where we wanted it at all or where the customer demanded. It was quite bad compared to now. Having said that, you have to be 99% right. If they have to change more than maybe one or two words, they don't like it well enough. It's really easy getting a product to where it seems like it's really good. Then when you bring it to users, they, ah, but I want to use this word.
I want to use that word. Many users, doctors, for example, when talking to a patient, they use language the patient understands, but then in the medical records, they want to use the correct medical terms. There's a lot of work in making sure that we don't use the words they use in the conversation, we use the medical terms, and that we don't use the wrong medical terms. It's really a lot of work in the margin to get it really good. Out of the box, they are really good, but it's not good enough. The difference is not huge. But what we have is much more personalization, so it fits how you want it done. That's the big difference.
The payback time for them is, if they save an hour per day at the moment, that will give them easily time to have one extra patient. One extra patient is on average, I would say, around SEK 1,000 of revenue. The cost for their solution is SEK 750 per month. Most doctors don't have sick patients maybe five days a week, but say four days a week. Then you have SEK 4,000 per week in extra revenue, so SEK 16,000 per month roughly. The cost is SEK 750. The payback is really easy. But healthcare is really slow to change, and that's the problem. We cannot price it to the value we provide them because there are other solutions out there.
We have a really strong position because it is fully built into the system and we have access to information that the external ones do not have. Our solution is and will be better for most users. Anyway, we want it to grow really quickly and that is what we price it for.
Next one, R&D headcount decreased in the quarter. Does this relate to the restructuring Infosolutions? Yes, it does. Then one from Yannick Yukel. Sorry if I missed your comments regarding cost in Q4, but what will be the extra cost you expect to have for MDR professional service, IT service? How much of this will be recurring? Asked more simply, what are your expectations for the recurring cost base going out of Q1 next year? It is a mix regarding the increased cost, and it is also related to the comparison, as I mentioned, where we had a bit of reduced one-off cost last year. So it is tough comparables.
But yeah, out of the sales and marketing costs, the personnel I mentioned will naturally come back. So that will increase the cost base by a couple of million in Q1. But other than that, it is mostly temporary effects. Final question we have gotten in the chat from Rasmus Persson. "Good morning. I noticed Aleris has taken over several [Non-English content] from September and onwards. Has those revenue gone live for you yet?
Yeah. Good Rasmus. I think these are probably eye clinics you are referring to. We have a number of Aleris eye clinics that they won the contracts in Stockholm, and those are the ones who started using e-referrals. We had to really push, because Stockholm closed down their pay choice around eye surgery, and then it went on tender instead. A lot of present clinic had to kind of close down or change what they did, and then new clinic started. That is great for us. Then we just need to win the competition. We do not need to convince someone to change system.
That's why Aleris and also some others said that, we want to use Webdoc, and we would love it if you get e-referrals working by that point in time, because there will be a lot of referrals coming in. That's what we really pushed for in Q2 in development to get it out and tested and, especially, Stockholm was really great in helping us in that. They got up and running. A couple of Aleris clinics has gone live. That being said, I do not think there has been so much revenues from them in Q3, and the reason is that I do not remember exact the date when they start seeing patients, but referrals started coming in the summer. I think they start seeing patients in the end of Q3 or if it is early Q4.
It is part of the backlog as well, some of those clinics.
They have not started yet.
That was the final one.
Okay, done. Thank you all for today, and have a good day. Just reach out if you have any more questions. We are always available. Thank you.