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Sharecare announces third quarter 2022 financial results and operational highlights
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Third Quarter 2022 Financial Results
All comparisons, unless otherwise noted, are to the three months ended
- Revenue of
$114.6 million compared to$105.6 million , an increase of$9.0 million , or 9%. - Net loss attributable to
Sharecare of$27.4 million compared to net loss attributable toSharecare of$43.1 million , a decrease of$15.7 million . Adjusted net loss attributable toSharecare of$2.0 million compared to adjusted net loss attributable toSharecare of$0.8 million in the prior year period. - Adjusted EBITDA of
$7.2 million compared to$7.9 million , a decrease of$0.7 million . - Net loss per share of
$0.08 compared to$0.13 , a decrease to net loss per share of$0.05 . - Adjusted loss per share of
$0.01 compared to$0.00 , which excludes the impact of non-cash and non-operational amounts.
Financial Outlook
While
Conference Call
The company will host a conference call to review the third quarter results today,
Non-GAAP Financial Measures
In addition to our financial results determined in accordance with
The calculations and reconciliations of historical adjusted EBITDA, adjusted net income (loss), and adjusted EPS to net income (loss), the most directly comparable financial measure stated in accordance with GAAP, are provided below and in the accompanying financial tables. Investors are encouraged to review the reconciliations and not to rely on any single financial measure to evaluate our business.
We have not reconciled adjusted EBITDA guidance to net income (loss) because we do not provide guidance for net income (loss) or for items that we do not consider indicative of our ongoing performance, including, but not limited to, the impact of significant non-recurring items, as certain of these items are out of our control and/or cannot be reasonably predicted. Accordingly, reconciliations of adjusted EBITDA guidance to the corresponding
Adjusted EBITDA
We calculate adjusted EBITDA as net income (loss) adjusted to exclude (i) depreciation and amortization, (ii) interest income, (iii) interest expense, (iv) income tax (benefit) expense, (v) loss on extinguishment of debt, (vi) other (income)/expense (non-operating), (vii) share-based compensation, (viii) severance, (ix) warrants issued with revenue contracts, (x) net costs associated with exiting contracts, and (xi) transaction and closing costs. We do not view the items excluded as representative of our ongoing operations.
Adjusted Net Income (Loss)
We calculate adjusted net income (loss) as net income (loss) attributable to
Adjusted Earnings (Loss) Per Share
We calculate adjusted EPS as adjusted net income (loss), as defined above, divided by the number of weighted average common shares outstanding - basic and diluted.
About
Important Notice Regarding Forward-Looking Statements
This press release contains forward-looking statements within the meaning of the
Forward-looking statements in this press release include, but are not limited to, statements regarding our digital-first advocacy solution and our ability to realize the expected benefits of partnerships or other relationships with third parties or customers on our future growth objectives and the statements under the caption "Financial Outlook."
We cannot assure you that the forward-looking statements in this press release will prove to be accurate. These forward-looking statements are subject to a number of significant risks and uncertainties that could cause actual results to differ materially from expected results. Descriptions of some of the factors that could cause actual results to differ materially from these forward-looking statements are discussed in more detail in our filings with the
Media Relations:
jen@sharecare.com
Investor Relations:
SharecareIR@westwicke.com
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CONSOLIDATED STATEMENTS OF OPERATIONS |
|||||||
(Unaudited) |
|||||||
(In thousands, except share and per share amounts) |
|||||||
Three Months Ended |
Nine Months Ended |
||||||
2022 |
2021 |
2022 |
2021 |
||||
Revenue |
$ 114,619 |
$ 105,618 |
$ 319,153 |
$ 294,279 |
|||
Costs and operating expenses: |
|||||||
Costs of revenue (exclusive of depreciation and amortization below) |
60,322 |
51,255 |
165,052 |
144,283 |
|||
Sales and marketing |
12,032 |
12,492 |
40,698 |
36,047 |
|||
Product and technology |
17,136 |
16,334 |
54,237 |
52,600 |
|||
General and administrative |
38,552 |
46,307 |
138,041 |
85,060 |
|||
Depreciation and amortization |
12,053 |
8,751 |
32,831 |
22,601 |
|||
Total costs and operating expenses |
140,095 |
135,139 |
430,859 |
340,591 |
|||
Loss from operations |
(25,476) |
(29,521) |
(111,706) |
(46,312) |
|||
Other income (expense): |
|||||||
Interest income |
319 |
20 |
450 |
49 |
|||
Interest expense |
(548) |
(12,836) |
(1,579) |
(26,941) |
|||
Loss on extinguishment of debt |
— |
(1,148) |
— |
(1,148) |
|||
Other income (expense) |
(2,382) |
(86) |
17,290 |
(20,815) |
|||
Total other income (expense) |
(2,611) |
(14,050) |
16,161 |
(48,855) |
|||
Loss before income tax benefit |
(28,087) |
(43,571) |
(95,545) |
(95,167) |
|||
Income tax benefit |
627 |
507 |
265 |
520 |
|||
Net loss |
(27,460) |
(43,064) |
(95,280) |
(94,647) |
|||
Net (loss) income attributable to noncontrolling interest in subsidiaries |
(103) |
51 |
(697) |
(31) |
|||
Net loss attributable to |
$ (27,357) |
$ (43,115) |
$ (94,583) |
$ (94,616) |
|||
Net loss per share attributable to common stockholders, basic and diluted |
$ (0.08) |
$ (0.13) |
$ (0.27) |
$ (0.36) |
|||
Weighted-average common shares outstanding, basic and diluted |
349,615,224 |
334,982,150 |
347,232,210 |
263,558,268 |
|
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CONSOLIDATED BALANCE SHEETS |
|||
(Unaudited) |
|||
(In thousands, except share and per share amounts) |
|||
As of |
As of |
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Assets |
|||
Current assets: |
|||
Cash and cash equivalents |
$ 202,564 |
$ 271,105 |
|
Accounts receivable, net (net of allowance for doubtful accounts of |
99,660 |
103,256 |
|
Other receivables |
2,445 |
5,327 |
|
Prepaid expenses |
12,300 |
8,819 |
|
Other current assets |
2,287 |
2,459 |
|
Total current assets |
319,256 |
390,966 |
|
Property and equipment, net |
5,404 |
4,534 |
|
Other long-term assets |
29,348 |
12,173 |
|
Intangible assets, net |
165,538 |
155,086 |
|
|
191,136 |
192,442 |
|
Total assets |
$ 710,682 |
$ 755,201 |
|
Liabilities, Redeemable Convertible Preferred Stock and Stockholders' Equity |
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Current liabilities: |
|||
Accounts payable |
$ 12,208 |
$ 27,155 |
|
Accrued expenses and other current liabilities |
63,760 |
51,653 |
|
Deferred revenue |
11,007 |
11,655 |
|
Contract liabilities, current |
2,026 |
4,597 |
|
Debt, current |
943 |
— |
|
Total current liabilities |
89,944 |
95,060 |
|
Contract liabilities, noncurrent |
384 |
1,745 |
|
Warrant liabilities |
4,186 |
10,820 |
|
Long-term debt |
— |
419 |
|
Other long-term liabilities |
21,775 |
24,116 |
|
Total liabilities |
116,289 |
132,160 |
|
Commitments and contingencies |
|||
Series A convertible redeemable preferred shares, |
58,205 |
58,205 |
|
Stockholders' equity: |
|||
Common stock, |
35 |
35 |
|
Additional paid-in capital |
1,110,803 |
1,042,164 |
|
Accumulated other comprehensive loss |
(4,166) |
(2,061) |
|
Accumulated deficit |
(571,696) |
(477,113) |
|
Total |
534,976 |
563,025 |
|
Noncontrolling interest in subsidiaries |
1,212 |
1,811 |
|
Total stockholders' equity |
536,188 |
564,836 |
|
Total liabilities, redeemable convertible preferred stock and stockholders' equity |
$ 710,682 |
$ 755,201 |
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RECONCILIATION OF GAAP NET LOSS TO ADJUSTED EBITDA |
|||||||
(Unaudited) |
|||||||
(In thousands) |
|||||||
Three Months Ended |
Nine Months Ended |
||||||
2022 |
2021 |
2022 |
2021 |
||||
Net loss |
$ (27,460) |
$ (43,064) |
$ (95,280) |
$ (94,647) |
|||
Add: |
|||||||
Depreciation and amortization |
12,053 |
8,751 |
32,831 |
22,601 |
|||
Interest income |
(319) |
(20) |
(450) |
(49) |
|||
Interest expense |
548 |
12,836 |
1,579 |
26,941 |
|||
Income tax benefit |
(627) |
(507) |
(265) |
(520) |
|||
Loss on extinguishment of debt |
— |
1,148 |
— |
1,148 |
|||
Other (income) expense |
2,382 |
86 |
(17,290) |
20,815 |
|||
Share-based compensation |
10,331 |
11,130 |
61,619 |
25,517 |
|||
Severance |
407 |
700 |
1,177 |
965 |
|||
Warrants issued with revenue contracts(a) |
14 |
21 |
48 |
59 |
|||
Net costs associated with exiting contracts(b) |
563 |
— |
3,486 |
— |
|||
Transaction and closing costs(c)(d) |
9,333 |
16,822 |
23,728 |
18,844 |
|||
Adjusted EBITDA(e) |
$ 7,225 |
$ 7,903 |
$ 11,183 |
$ 21,674 |
(a) |
Represents the non-cash value of warrants issued to clients for meeting specific revenue thresholds. |
|
(b) |
For the nine months ended |
|
(c) |
For the three months ended |
|
(d) |
For the nine months ended |
|
(e) |
Includes non-cash amortization associated with contract liabilities recorded in connection with acquired businesses. |
|
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RECONCILIATION OF GAAP NET LOSS ATTRIBUTABLE TO SHARECARE TO ADJUSTED NET |
|||||||
(Unaudited) |
|||||||
(In thousands, except share and per share amounts) |
|||||||
Three Months Ended |
Nine Months Ended |
||||||
2022 |
2021 |
2022 |
2021 |
||||
Net loss attributable to |
$ (27,357) |
$ (43,115) |
$ (94,583) |
$ (94,616) |
|||
Add: |
|||||||
Amortization of acquired intangibles(a) |
1,632 |
1,425 |
4,895 |
3,653 |
|||
Amortization of deferred financing fees |
71 |
12,135 |
209 |
15,466 |
|||
Change in fair value of warrant liability and contingent consideration |
2,977 |
63 |
(15,765) |
21,719 |
|||
Share-based compensation |
10,331 |
11,130 |
61,619 |
25,517 |
|||
Severance |
407 |
700 |
1,177 |
965 |
|||
Warrants issued with revenue contracts(b) |
14 |
21 |
48 |
59 |
|||
Net costs associated with exiting contracts(c) |
563 |
— |
3,486 |
— |
|||
Transaction and closing costs(d)(e) |
9,333 |
16,822 |
23,728 |
18,844 |
|||
Adjusted net loss(f) |
$ (2,029) |
$ (819) |
$ (15,186) |
$ (8,393) |
|||
Weighted-average common shares outstanding, basic and diluted |
349,615,224 |
334,982,150 |
347,232,210 |
263,558,268 |
|||
Loss per share |
$ (0.08) |
$ (0.13) |
$ (0.27) |
$ (0.36) |
|||
Adjusted loss per share |
$ (0.01) |
$ 0.00 |
$ (0.04) |
$ (0.03) |
(a) |
Represents non-cash expenses related to the amortization of intangibles in connection with acquired businesses. |
|
(b) |
Represents the non-cash value of warrants issued to clients for meeting specific revenue thresholds. |
|
(c) |
For the nine months ended |
|
(d) |
For the three months ended |
|
(e) |
For the nine months ended |
|
(f) |
The income tax effect of the Company's non-GAAP reconciling items are offset by valuation allowance adjustments of the same amount given that the Company was in a full valuation allowance position for the periods presented. |
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