Good afternoon. My name is Edwin Barparadarian, and I'm a member of the JPMorgan Healthcare Investment Banking team. Thank you all for joining today, and it is my pleasure to introduce Randall Lipps, CEO of Omnicell. As a reminder, you may submit questions through the Ask a Question feature listed under the presentation. Thank you.
Well, thanks for joining us today. It's really nice to have you. And as we flip through the slides, I'll let you know which one we're on. So if you will go to the disclaimers page, please. This is our normal standard disclosures page.
Thank you. If you would advance to the next slide entitled Vision. Fundamentally, our vision is out to change one of the largest and most significant areas in health care. Twenty seven years ago when I started this business, we were focused on supply chain and medication management and working through areas that were friction in the process, eliminating manual task. Through the years, we've acquired technologies, improved new solutions, deployed new platforms.
And today, we arrive at the point where we have unparalleled types of customers signed up with us, not only great providers, almost half of the 300 largest ones are our customers, but also a brand, a brand that is synonymous with innovation. And today, the medication management piece of healthcare, which is done in every venue, in every place that medication, takes place, there is healthcare. And it's so critical today. And the pandemic has certainly put highlighted that particular area. Two years ago, when we started the journey on the autonomous pharmacy, we were focused on moving, the industry to a more digital platform.
The pandemic brought us all to a virtual world. And when you're in the virtual world, you need digital tools. And so hence, the acceleration of our business. The message that we have with our customer base is resonating in the marketplace. So let's look at some of the financial results that we just released this morning, and let's talk about a few of those highlights.
I will have Peter discuss the financial highlights later on as well as Scott Seidelman will discuss more about our digital path that we've been put on and that he's been leading and driving as the Chief Commercial Officer. So first, on our next slide, delivering strong results and building momentum, I wanted to make a couple of points. One is our pre pandemic guidance was less than $900,000,000 for our bookings. We just announced our prelim number as being a billion dollars. In other words, overachieving our guidance by a substantial amount.
And this is really in the last six months. As healthcare systems were able to manage through the initial phases of the pandemic, they realized they needed tools to deal with their medication management workflow. And so not only did our platform expand, but particularly the tool sets, the tech enabled services and the software as a service businesses grew. And these are faster growing services and generally higher margin businesses than the other components of our revenue from our core. Also, I'm excited to talk about next year.
This is leading to a double digit growth in our revenues. And maybe even more importantly, we see almost a 50% growth in year over year non GAAP EBITDA. This is a significant move for us as the growth from our bookings is continuing to accelerate through the year and is delivering great results for the company. I would just like to point out that the platform makes a lot of sense. And as people join into the platform, they're buying more of the tech enabled solution sets that allow them to understand their business better than they ever had before.
Now if we go into the next slide, I want to talk a little bit why are we so well positioned, not just to grow well next year, but over the next five years. We also discussed in our announcements this morning what our 2021 to 2025 roadmap looks like for growth of organic and inorganic to where we can believe we can get to 14% to 15% on a CAGR combined in 2025. That's quite significant, as a company and gives us, really, the confidence that we can get there is because we have a great position in the marketplace. We have great customers that are the leading institution that have joined us on this journey to the digital pharmacy, the autonomous pharmacy. We also have a good understanding of our core products and the ebbs and flows of how those will be deployed in the platform.
And as those products are deployed throughout the platform, it will take the enhanced software or the SaaS business and the tech enabled services to enhance them, to deliver even more value for our customers and therefore more value for our shareholders. And as we move on to the next slide, I just want to talk about one of the things that's really difficult, I find with investors sometimes, is to understand how complex pharmacies really are. It doesn't matter whether it's an acute care, retail or industrial pharmacy, they're complex. And the goals that each of these pharmacies have are pretty much the same, deliver the right drugs to the right patient at the right time in the right form. But doing that is quite complicated.
And when you have a complicated process, that's not fully automated, you have to insert people. You have to insert manual tasks. It means that things happen slowly. It means that errors appear in the process that cost you safety, that cost you money, and you don't deliver the best results you could, particularly in the patient outcome. They're not getting the right drug at the right price at the right time.
It isn't the best outcome. So as we move forward, we want to understand that there's still a lot of problems to solve in the complexity of the pharmacy. So on the next slide, many of the chief pharmacy officers of the leading institutions got together and created this roadmap as to where are we in this digital roadmap to the autonomous pharmacy. What does that look like? And what should it look like if we were to break it down into steps and phases?
And so this was the product they produced. And amazingly, they all bought into, we need this product, we need these kinds of solutions to take us where we need to go. But today, most all of these Chief Pharmacy Officers identify themselves as level one or two of the framework. Now if the customer deploys all of our products and puts them in place, we can get them pretty much to level three. But that means there's more levels to go both for us and our customers over the next several years.
And as you go up each of these levels, the amount of value that is created is so substantial that it will generate more revenues and earnings for us and more value and creation for our shareholders. And a lot of these pieces that are missing or left or that we're working are cloud based, SaaS based, tech enabled services that will finally solve some of these very difficult problems that could not have been solved if we did not have the cloud, if we didn't have unlimited storage space, if we didn't have unlimited compute power and then almost unlimited bandwidth. These kinds of technologies allow the Autonomous Pharmacy to solve problems that could never be solved before. But let me turn it over to Scott Seidelman, our Chief Commercial Officer, to tell you a little bit more about what we're doing in this area and particularly the five tech enabled services we have today. Scott?
Thanks, Randy. Hello, everyone. For those of you following along at home, I'm picking up on page eight. So it really is exciting as Randy just articulated that that framework paints very exciting and and frankly, almost quantifies the the journey or the future of pharmacy and how and how this this enormous opportunity exist to create more health care value. Well, the exciting thing for us is that certainly translates into a a fabulous experience, opportunity for us.
And to that end, at the end of twenty eighteen, we launched an entirely new category, which we call the autonomous pharmacy. Now the autonomous pharmacy, the real vision is that it's transform the pharmacy care delivery model by by unburdening or automating those manual workflows, those those administrative tasks that really hold back the pharmacist, the nurse, the caregiver from really focusing on the very difficult clinical problems that they should be focused on. So in its simplest level, the Autonomous Pharmacy is a combination of hardware, software, and services that together really drive better outcomes for the customer. So in a little bit more detail, if you go to that lower left hand side, the automated dispensing cabinet, we're a market leader. XT is the our our most recent version of that product.
We're early on in the replacement cycle. If you move slightly to the right, XR two robot, IV robot, we've been investing in the, robotic solutions to automate that central pharmacy environment. XR two is our robot that automates the central pharmacy and oral dispense. IV is our robot that automates IV compounding. We are very excited and bullish that we believe that in the future, we will deliver new products that, new devices that are smarter, more modular, that really innovate in other settings of care.
If you move out to the platform, we've been and we will continue to invest in a single cloud platform that connects all of those devices, certainly lowers or will lower the total cost of ownership for our customers, makes it faster and cheaper for us to deploy new products, but most importantly, enables us to deliver true technology enabled services. And over the last couple of years, we have launched and brought to markets several of those services. Omnicell One is a service that combines software analytics and experts that really helps providers optimize pharmacy labor, drug spend, diversion and compliance events. Central Pharmacy Dispense Service or CPDS is a service that combines our XR two robot with analytics and experts that really helps providers automate that central pharmacy function to improve, to lower cost and eliminate errors. IV Rise is a technology enabled service that combines our IV robot with analytics and experts that helps health systems and providers lower the cost and improve the quality of of IV preparation.
Enlive and Health is a service that again combines software analytics and experts that one, really helps pharmacists provide, perform value added tasks for patients such as distributing the COVID vaccine, which is now critically important. And number two, really helps pharmacists work closely with payers to help optimize medication management for complex populations. So ultimately, Enliven is is is really our innovation on on on defining what the role of a pharmacist is in a value based environment or in a population health world. And lastly, with our recent acquisition Omnicell three three forty b is a technology enabled service that combines software analytics and experts and really helps providers manage that vital but increasingly complex and growing three forty b program. So two really important things that that I think are are to take away about these technology enabled services is that one, they create meaningful new addressable market, which I'll talk a little bit more about.
But because they are all subscriptions, they are recurring revenue services. And secondly, while the autonomous pharmacy as a whole and certainly these services will undoubtedly, march providers or pharmacists up those levels of the framework, there is still a lot of opportunity. And and and we're gonna continue to invest to create more value and capture that value and launch more services. Bottom line is is that that the autonomous pharmacy has the potential to transform the pharmacy care delivery model and in turn generate significant returns for Omnicell and our shareholders. So now on page, nine, a bit about our go to market.
So undoubtedly bringing innovations like the autonomous pharmacy to market in health care is difficult for some really good reasons and and frankly some bad reasons. I spent the decade before I joined Omnicell as an entrepreneur in health care, so know that as well as anyone. But one of our single biggest differentiators at Omnicell is thus the depth and breadth of our customer base. So over half the hospitals in The US are customers. As Randy mentioned, a 145 of the top 300 health systems have sole source contracts with the Johns, which is important because what that means is that they've entered into long term strategic relationships with us because of the vision of the Autonomous Pharmacy.
But we also have reached into over 60% of the post acute care environment through our customer relationships with institutional pharmacies. And increasingly our footprint on the retail side, particularly amongst the large chains is growing. There's two really important things about this. Is that as we bring innovations to market, our channel and our brand, which is synonymous with solving problems in medication management for the last twenty five years, gives us a unique competitive advantage to bring innovations like the Autonomous Pharmacy to this market. And two, as healthcare shifts from this fee for service world to this value based environment, we are incredibly well positioned in the future to bring new services that really help that, that entire episode of care for the patient because we can touch the entire continuum of care.
So at the end of the day, what we're really, really excited about is that our channel and brand, which is really unparalleled in this segment of the the sector of the health care industry, enables us to realize the potential of the autonomous pharmacy. On page 10, and that potential frankly, the opportunity which at the end of the day, we're probably the most excited about here is sizable. This is a the Autonomous Pharmacy is a very large and growing market. Now, these TAMs you see here below, just a note, these are ten year TAMs. They include products, services, so they're a combination of things.
But we thought that it would give you, at least a directional sense of how we think about where our our market opportunity actually is. And so point of care, the standard ADC is a standard of care there. We are a market leader. XT is our flagship product there. We're early on in that replacement cycle that will continue to give us growth.
As I mentioned previously, we are excited about future innovations in that segment of the care delivery model. Central pharmacy today, it's an incredibly labor intense portion of the care delivery model and one that yields high cost and frankly more errors than it should. That's an incredibly exciting opportunity for us with services like CBDs and IV Rise that really help providers to automate automate away those those manual functions of the central pharmacy. That will create significant growth opportunity for us. OC one, if you effectively think about it, really knits together the points of care and the central pharmacy, thus giving providers the opportunity to really balance that portion of of their care delivery model and and again, generate and realize value.
With our recent acquisition, we are now incredibly well positioned with our technology enabled service Omnicell 340B to help providers really manage what is now a vital portion of of of their financial model and also is a rapidly growing and expanding area. So we're excited about that. And then the retail institution and payer market represents a real market opportunity and we're bullish that Enlivant Health will will create an opportunity for us of of real growth in that in that sector. At the end of the day, bottom line is what we're excited about here is that the autonomous pharmacy and the launch of our new technology enabled service, number one, has created meaningful new addressable market for us. And number two, has created significant recurring revenue streams for us.
Both of which are exciting and I know that the latter of which Peter, will tell you more about in the next couple of slides. So thank you very much. And I will hand it off now to Peter.
Thank you, Scott. Now, moving to page 11. Wanted to spend a minute on the high visibility and the resilience of our revenue and our revenue base. As the CFO, I'm thrilled with that high visibility. Let me break it down for you and the main drivers of this high visibility.
First, as Randall mentioned earlier in the call, we exceeded our product bookings for the year very significantly and that is resulting in record backlog as we move forward. That is also, we believe, that medication management, now also because of the pandemic, very, very strategic for health systems. Second, as mentioned earlier, we have very deep and long standing customer relationships. And with the two newly signed, and that we announced, two new long term sole source contracts within the top 300 of US health systems, we now have a total of 145 health systems in the top 300 US health systems landscape that are long term customers of Omnicell. They are signing up for the vision and the journey to UTolmes pharmacy to drive value for customers and for patients.
Thirdly, we have a very, very high customer retention of around 99% plus measured on a revenue basis. And that is because customers see the value in the solutions that we offer. And then lastly, in our large installed base of connected devices, we have a very predictable upgrade cycle. That combined with on the right side our technical services, have a very high degree of visibility and predictability. And then lastly, and I'll talk about this in the next slide, we see very, very strong growth coming from advanced services.
So let's move to the next slide, which is page 12, advanced services. Like Marilyn and Scott talked about earlier, because we have the platform and we are so important for our top customers, they are adding from a very critical perspective, advanced services. This is software as a service, subscription software and tech enabled services. And the $100,000,000 exceeds in product bookings versus the guidance for the year 2020, That was driven, one, by our long term sole source contracts, but also by the advanced services. Advanced services significantly exceeded the internal plan for the year.
So we see strong growth there. On the right side you see the drivers. Again, our very strong customer base we believe will continue to drive very strong growth there. And of course the future moves to digitization and cloud based solutions. So this is also contributing to very predictable, highly visible, high margin unit economics.
And we predict that by 2025 we're targeting this revenue stream to be between 2030% of total revenue and it represents an around 50% annualized CAGR over that same time period. Let's move to the next slide. Let's talk about the long term financial framework. In prior calls, we've talked about the long term financial framework of 10% to 12% on the organic growth level. First of all, I want to start off with the update to the guidance that Randall provided earlier today for 2021.
The updated revenue guidance for 2021 is now $1,850,000,000 to $1,105,000,000 which represents a significant increase over the guidance that we provided in the October earnings call and represents a 20% plus revenue growth. Of course, this is off a base in 2020 which was impacted by COVID. However, because of all the drivers that we just talked about, we see a very strong total revenue growth going forward between 1415% total CAGR for total revenue between 2021 and 2025, and we're estimating and targeting a total revenue of 1,900,000,000.0 to $2,000,000,000 in 2025. And then we expect an organic CAGR of 11% to 12% from 2021 to 2025. And that actually is an increase of the earlier framework that was 10% to 12%.
You see very strong drivers there and as a CEO I'm very pleased that we have multiple very strong and very visible and predictable growth drivers. So first of all, our customers are expanding the use of our medication management solutions. Many of the 145 now long term sole source customers, the vast majority of those have multi year medication management automation plans, and we have co developed those for them. We have high visibility. So first of all, customers, we have a large installed base, they are expanding both with existing products and also expected with new products via innovation.
And secondly, we have a number of upgrade cycles, the biggest one being the XT upgrade cycle, and we're still fairly early on in that upgrade cycle. And then we continue to gain market share gains. One of the two announced newly signed long term sole source agreements actually is a significant market share gain as well. And then we continue to drive, of course, innovation as we help our top health systems drive to the next level through the autonomous pharmacy with significant value for hospitals. And then lastly, from an inorganic perspective, because we're scaling so well and we now have the platform since some time, it's very logical that we could do and execute failure enhancing M and A, where an acquisition could be integrated and bolted on to our platform and leverage the large customer installed base and could be added on to those long term sole source agreements.
Let's look at profitability on page 14. In the previous long term financial framework, had and that was in December 2019 we had targeted an 18 long term operating margin target. We now have increased that to 21%. So we're very confident that from the estimated non GAAP operating margin in 2021 of around 70% that we can deliver an expansion of non GAAP operating margin by 400 basis points to 21% by 2025, which means an expansion of 100 basis points per year. We have the same drivers on EBITDA as well.
We're expecting and targeting and are very confident that we can expand the non GAAP EBITDA margin that's estimated for us for now at 21%, around 21% in 2021. We're confident that we can expand that to 25% by 2025, so expanding that also by 400 basis points. The drivers of course for both expansions are very similar. We expect again to improve the business mix as we move more to the SaaS and advanced services that will support gross margins. Then the long term sole source agreements, the partnership agreements, represents really highly visible non RFP partnerships.
Then economies of scale, as we scale here, very predictable margin improvement as we continue to scale. And then manufacturing savings. We have a great global supply chain leader and see us leading productivity programmes and delivering real savings. And then lastly, we're also driving virtualisation and digitalisation of commercial and implementation processes that will also reap benefits from a margin perspective. And then some of those savings we are of course reinvesting in innovation as we drive towards the next levels of the autonomous pharmacy with the industry.
Now let's move back to Randy or Randall for a summary.
Thanks, Peter. Just if you move to the next slide on building our track record of delivering shareholder value. There we just have a slide of multi years where you're looking at total returns that Omnicell has delivered for its shareholders. And it's been a great, many years that we have endeavored to drive value for our shareholders. But I want to point out that we're just as excited about the next five years.
And it's just not the fact that we're targeting the doubling the size of the company, but it's how we're doing it. We're just not only gaining market share and deploying more products, but it's the kinds of revenue and it's the kinds of solution sets that we're deploying, which will deliver enormous value for our customers and for our shareholders as we move forward. So in the last slide, in just summary, I would simply say that Omnicell is well positioned, from its customer and market position, from our products that we have currently as core products in the marketplace. As we start to launch the new SaaS and tech enabled services that are already catching on as demonstrated by, our last year's, uptick in our bookings. And as we're able to acquire and put new technologies and build them into our platform, to give our customers even better solution sets that are integrated and part of the total solution, we'll be able to deliver on these results, I believe, and, continue to grow the company.
It's an exciting time in the company's history. The pandemic has really accelerated like it has for a lot of businesses, the digital part of our business that we started two years ago. And that's clearly seen as a great strategy that's working now and is going to continue to work as we move forward. So with that, that's the end of our formal presentation and we will now move to the Q and A session.
Hi, everyone. There do not appear to be any questions at this time. So with that, we'd like to conclude our presentation with you today. We very much appreciate your interest in Omnicell, and we look forward to continuing our dialogue with you in the weeks and months to come. Thank you very much for attending today.
Cheers. Thank you.