Content analysis
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H.S. junior Avg
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New words:
accidental, activist, addenda, Addendum, API, arose, arriving, chance, chat, clear, defense, destruction, dispute, disputed, distressed, downstream, DPP, East, entirety, environmental, ERP, fell, forgo, forgoing, Gaza, hacking, HCP, implicate, instruction, job, label, literacy, magnitude, medium, Middle, mindful, Oncology, onsite, outlined, overnight, Perspective, pertaining, programmatic, purported, recast, recur, recurring, regain, remit, repeated, repricing, repudiation, resume, send, shareholder, SIEM, standby, staving, stick, Strip, submission, TB, thirty, unambiguously, unaudited, underperformance, unfeasible, uninterrupted, unprecedented, unprofitable, Unscripted, untimely, vacation, vigorously, voluntarily, VSA, WeCare, white, yearly
Removed:
consolidate, depending, dissolve, exchanged, North, November, renamed, repaid, square
Financial report summary
?Competition
LimeadeRisks
- Our industry is rapidly evolving and undergoing significant technological change. If we are not successful in adapting to this evolving environment and promoting and improving the benefits of our platform, our growth may be limited, and our business may be adversely affected.
- We may be unable to compete effectively against our current and future competitors, which could have a material adverse effect on our results of operations, financial condition, business, and prospects.
- We derive a material portion of our revenue from our largest clients. The loss, termination, or renegotiation of any contract with such clients could negatively impact our results.
- Saturation or consolidation in the healthcare industry could result in the loss of existing clients, a reduction in our potential client base and downward pressure on the prices for our products and services.
- Our sales cycles can be long and complicated and require considerable time and expense. As a result, our sales and revenue are difficult to predict and may vary substantially from period to period, which may cause our results of operations to fluctuate significantly.
- If our existing clients do not continue or renew their contracts with us, renew at lower fee levels or decline to purchase additional solutions from us, it could have a material adverse effect on our business, financial condition, and results of operations.
- Economic uncertainty or downturns, particularly as it impacts particular industries, could adversely affect our business and operating results.
- The growth of our business relies, in part, on the growth and success of our enterprise clients and the number of members with access to our offerings, which are difficult to predict and are affected by factors outside of our control. If the number of members of the populations of our enterprise clients decreases or the number of those members that utilize our solutions decreases, our revenue will likely decrease.
- Our sales and the success of our marketing efforts depend in part on our ability to call upon our current clients to provide positive references to new, potential clients. Failure to obtain such references may adversely affect our ability to grow our client base and have a negative and adverse effect on our business, financial condition, and results of operations.
- We face risks, such as unforeseen costs and potential liability in connection with content we produce, license, and distribute through our platform.
- The growth of our business and future success relies, in part, on our partnerships and other relationships with third parties and our business could be harmed if we fail to maintain or expand these relationships.
- We could face reputational damage or loss of trust from our clients and members as a result of transferring inaccurate or incomplete information, as well as potential regulatory risk or other liability for errors in processing information, all of which could harm our business, financial condition and results of operations.
- Our business, financial condition, and results of operations may be adversely affected by pandemics or epidemics such as COVID-19 or other adverse public health developments.
- Our business could be disrupted by catastrophic events and man-made problems, such as power disruptions, data security breaches, terrorism, and public health emergencies.
- We depend on our talent and corporate culture to grow and operate our business, and if we are unable to hire, integrate, develop, motivate and retain our personnel, including our senior management, Sharecare+ advocates, clinical and various product and technology roles, our business could be adversely affected, and we may not be able to grow effectively.
- If we are not able to maintain and enhance our reputation and brand recognition, our business, financial condition, and results of operations could be adversely affected.
- We use offshore third-party partners located in India, the Philippines and other countries, that subject us to regulatory, economic, social and political uncertainties and to laws applicable to U.S. companies operating overseas and other risks of global operations.
- Acquisitions and investments could result in operating difficulties, dilution, and other harmful consequences that may adversely affect our business, financial condition, and results of operations. Additionally, if we are not able to identify and successfully acquire suitable businesses, our operating results and prospects could be harmed.
- We may not grow at the rates we historically have achieved or at all, even if our key metrics may indicate growth.
- If we fail to effectively manage our growth, we may be unable to execute our business plan, adequately address competitive challenges or maintain our corporate culture, and our business, financial condition, and results of operations could be adversely affected.
- The estimates of market opportunity and forecasts of market growth included herein may prove to be inaccurate, and even if the markets in which we compete achieve the forecasted growth, our business may not grow at similar rates, or at all.
- We face political, legal and compliance, operational, regulatory, economic and other risks related to our international operations that we do not face or are more significant than in our domestic operations. Our exposure to these risks is expected to increase.
- The failure of our platform to achieve and maintain market acceptance could result in us achieving sales below our expectations, which would cause our business, financial condition, and results of operation to be materially and adversely affected.
- If we are not able to develop new solutions, or successful enhancements, new features and modifications to our existing solutions, or otherwise incorporate such new solutions or enhancements, new features or modifications to existing solutions through acquisition or partnership, our business, financial condition, and results of operations could be adversely affected.
- We rely on internet infrastructure, bandwidth providers, third-party computer hardware and software, and other third parties for providing services to our clients and members, and any failure or interruption in the services provided by these third parties or the inability to access our platform on third-party operating systems could negatively impact our relationships with clients and members, adversely affecting our business, financial condition, and results of operations.
- Our solutions may not operate properly, which could damage our reputation, give rise to claims against us or our partners, or divert application of our resources from other purposes, any of which could harm our business, financial condition, and results of operations.
- If our enterprise resource planning system or other licensed software systems prove ineffective, we may be unable to timely or accurately prepare financial reports, make payments to our suppliers and employees, or invoice and collect from our members and clients.
- Security breaches, loss of data, and other disruptions could compromise sensitive information related to our business, partners, clients, or members, or prevent us from accessing critical information and expose us to liability, which could adversely affect our business and our reputation.
- We may be subject to legal proceedings, litigation, regulatory and other disputes, and governmental inquiries which are costly to defend and could adversely affect our business, financial condition, and results of operations.
- Changes in the health insurance market, ERISA laws, state insurance laws, or other laws could harm our business.
- Evolving government regulations may require increased costs or adversely affect our business, financial condition, and results of operations.
- If we fail to comply with healthcare and other governmental regulations, we could face substantial penalties, liabilities, or reputational harm and our business, financial condition, and results of operations could be adversely affected.
- Individuals may claim our outbound engagement techniques, including digital outreach, are not compliant with HIPAA or federal marketing laws.
- If our arrangements with our clients are found to violate state laws prohibiting the corporate practice of medicine or fee splitting, our business, financial condition, results of operations, and our ability to operate in those states could be adversely affected.
- If the independent contractors we utilize to provide home care services engage in, or are subject to, criminal, violent, or inappropriate conduct, our reputation, business, financial condition, and results of operations could be adversely affected.
- Failure to comply with anti-bribery, anti-corruption, and anti-money laundering laws could subject us to penalties and other adverse consequences.
- Our use, disclosure, and other processing of PII and PHI is subject to HIPAA and other federal, state, and foreign privacy and security regulations, and our failure to comply with those regulations or to adequately secure the information we hold could result in significant liability or reputational harm and, in turn, have a material adverse effect on our client base, member base and revenue.
- Any restrictions on our ability to obtain or use data could harm our business.
- Failure to protect or enforce our intellectual property rights could harm our business, financial condition, and results of operations.
- We have a history of net losses, we anticipate increasing expenses in the future, and we may not be able to achieve or maintain profitability.
- Our ability to use our net operating loss carryforwards and certain other tax attributes may be limited.
- We may require additional capital to support business growth, and this capital might not be available on acceptable terms, if at all.
- Our debt agreements contain certain restrictions that may limit our ability to operate our business.
- The applicability of sales, use, and other tax laws or regulations on our business is uncertain. Adverse tax laws or regulations could be enacted or existing laws could be applied to us or our clients or members, which could subject us to additional tax liability and related interest and penalties, increase the costs of our solutions, and adversely affect our business, financial condition, and results of operations.
- Certain U.S. state tax authorities may assert that we have a state nexus and seek to impose state and local income taxes which could harm our results of operations.
- We face high costs and demands upon management as a result of complying with the laws and regulations affecting public companies, which could adversely affect our business, financial condition, and results of operations.
- We are an “emerging growth company,” and our election to comply with the reduced disclosure requirements as a public company may make our common stock less attractive to investors.
- Our business, financial condition, and results of operations may fluctuate on a quarterly and annual basis, which may result in a decline in our stock price if such fluctuations result in a failure to meet the expectations of securities analysts or investors.
- Changes in accounting principles may cause previously unanticipated fluctuations in our financial results, and the implementation of such changes may impact our ability to meet our financial reporting obigations.
- If our estimates or judgments relating to our critical accounting policies prove to be incorrect, our business, financial condition, and results of operations could be adversely affected.
- The trading price of our common stock and warrants may be volatile.
- There can be no assurance that our securities will continue to be listed on Nasdaq or that will be able to comply with the continued listing standards of Nasdaq.
- Shareholder activism efforts or unsolicited offers from a third-party could cause a material disruption to our business and financial results.
- We may in the future issue additional shares of common stock (including upon the exercise of warrants or conversion of our preferred stock) which would increase the number of shares eligible for future resale in the public market and result in dilution to our stockholders.
- We may redeem our unexpired warrants prior to their exercise at a time that is disadvantageous to holders, thereby making such warrants worthless.
- There can be no assurance that the warrants will be in the money at the time they become exercisable, and they may expire worthless.
- Any future series of our preferred stock may have rights and preferences that are senior, or in addition, to the rights and preferences of our common stock.
- If securities analysts do not publish research or reports about our business or if they downgrade our stock or our sector, our stock price and trading volume could decline.
- Anti-takeover provisions contained in our Charter as well as provisions of Delaware law, could impair a takeover attempt.
- Our Charter designates the Court of Chancery of the State of Delaware as the sole and exclusive forum for certain types of actions and proceedings and the federal district courts as the sole and exclusive forum for other types of actions and proceedings, in each case, that may be initiated by our stockholders, which could limit our stockholders’ ability to obtain what such stockholders believe to be a favorable judicial forum for disputes with us or our directors, officers or other employees.
Management Discussion
- Revenue increased $2.8 million, or 1%, from $442.4 million for the year ended December 31, 2022 to $445.3 million for the year ended December 31, 2023. Revenue growth was driven primarily by increased volumes in audit and release of information records within the provider channel and new revenues for advocacy services in enterprise. Offsetting these increases was a decline in our home health services along with pricing pressures in population health within the enterprise channel.
- The channel revenue changed as follows: the enterprise channel decreased by $14.7 million (from $258.6 million for 2022 to $243.9 million for 2023), the provider channel increased by $15.1 million (from $104.2 million for 2022 to $119.3 million for 2023) and the life sciences channel increased by $2.4 million (from $79.6 million for 2022 to $82.0 million for 2023). The enterprise channel decrease of 6% was primarily attributable to the decision to reduce unprofitable nurse on demand locations, the repricing of a core legacy contract, and the ceasing of our Brazil operations. In addition, as outlined in the footnotes of the Company’s audited financial statements and as discussed above under Key Factors and Trends Affecting our Operating Performance - Contract Dispute, there was an $8.0 million negative impact to revenue in the year ended December 31, 2023 as compared to what was expected from contracted advocacy services under a single contract pending the resolution of certain contractual matters, and a related $6.2 million contract asset impairment charge that was recorded as a reduction to revenue because of the uncertainty as to whether, or when, the services under that contract might resume. The provider channel increase of 15% was attributable to new customers and the volume of records processed by the medical record audit business. The life sciences channel increase of 3% was attributable to growth in core pharma advertising spend.
- Costs of revenue increased $16.2 million, or 7%, from $238.3 million for the year ended December 31, 2022 to $254.5 million for the year ended December 31, 2023. The percentage increase in costs of revenue was higher than the percentage increase in revenue primarily from cost composition in association with the Company’s new advocacy services.