Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

As of ~~August 5, 2019,~~May 1, 2020, there were ~~166,653,482~~162,550,390 shares of the registrant's $0.01 par value common stock outstanding.

(In thousands, except per share amounts)	June 30, 2019		December 31, 2018		March 31, 2020		December 31, 2019
ASSETS
Current assets:
Cash and cash equivalents	$	138,903	$	174,243	$	204,308	$	129,668
Restricted cash		9,236		10,552		7,824		7,871
Accounts receivable, net of allowance of $41,647 and $50,406 as of June 30, 2019 and December 31, 2018, respectively		428,085		465,264
Contract assets		75,351		66,451
Accounts receivable, net of allowance of $35,622 and $23,879 as of March 31, 2020 and December 31, 2019, respectively						471,213		459,751
Contract assets, net of allowance of $1,068 and $0 as of March 31, 2020 and December 31, 2019, respectively						98,171		95,982
Prepaid expenses and other current assets		152,476		142,455		125,677		147,990
Total current assets		804,051		858,965		907,193		841,262
Fixed assets, net		105,923		121,913		81,830		88,339
Software development costs, net		225,646		209,660		250,412		243,929
Intangible assets, net		402,783		431,081		358,309		374,142
Goodwill		1,382,244		1,373,744		1,361,115		1,362,017
Deferred taxes, net		5,000		5,036		5,429		5,704
Contract assets - long-term		98,362		71,879
Contract assets - long-term, net of allowance of $4,273 and $0 as of March 31, 2020 and December 31, 2019, respectively						54,501		67,559
Right-of-use assets - operating leases		96,097		0		110,469		98,020
Other assets		115,367		109,206		123,598		124,767
Total assets	$	3,235,473	$	3,181,484	$	3,252,856	$	3,205,739

(In thousands, except per share amounts)	June 30, 2019			December 31, 2018			March 31, 2020			December 31, 2019
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable	$	90,670		$	73,166		$	79,168		$	104,014
Accrued expenses		256,516			107,068			217,273			270,662
Accrued compensation and benefits		53,741			100,076			67,635			68,569
Income tax payable		0			29,644
Deferred revenue		432,222			466,797			401,483			379,843
Current maturities of long-term debt		22,121			20,059			370,751			364,465
Current operating lease liabilities		24,501			0			21,910			23,137
Current liabilities attributable to discontinued operations		0			920
Total current liabilities		879,771			797,730			1,158,220			1,210,690
Long-term debt		822,724			647,539			680,434			551,004
Deferred revenue		13,011			15,984			12,439			12,337
Deferred taxes, net		56,899			58,470			18,484			21,038
Long-term operating lease liabilities		93,117			0			108,068			95,162
Other liabilities		53,744			81,334			33,431			30,320
Total liabilities		1,919,266			1,601,057			2,011,076			1,920,551
Commitments and contingencies
Stockholders’ equity:
Preferred stock: $0.01 par value, 1,000 shares authorized, no shares issued and outstanding as of June 30, 2019 and December 31, 2018		0			0
Common stock: $0.01 par value, 349,000 shares authorized as of June 30, 2019 and December 31, 2018; 272,472 and 166,653 shares issued and outstanding as of June 30, 2019, respectively; 270,955 and 171,224 shares issued and outstanding as of December 31, 2018, respectively		2,724			2,709
Treasury stock: at cost, 105,818 and 99,731 shares as of June 30, 2019 and December 31, 2018, respectively		(524,767	)		(460,543	)
Preferred stock: $0.01 par value, 1,000 shares authorized, 0 shares issued and outstanding as of March 31, 2020 and December 31, 2019								0			0
Common stock: $0.01 par value, 349,000 shares authorized as of March 31, 2020 and December 31, 2019; 273,484 and 161,901 shares issued and outstanding as of March 31, 2020, respectively; 272,609 and 162,475 shares issued and outstanding as of December 31, 2019, respectively								2,733			2,725
Treasury stock: at cost, 111,583 and 110,134 shares as of March 31, 2020 and December 31, 2019, respectively								(580,871	)		(571,157	)
Additional paid-in capital		1,867,613			1,881,494			1,914,816			1,907,348
(Accumulated deficit) retained earnings		(24,641	)		132,842
Accumulated deficit								(87,643	)		(49,336	)
Accumulated other comprehensive loss		(4,722	)		(5,389	)		(7,255	)		(4,392	)
Total Allscripts Healthcare Solutions, Inc.'s stockholders' equity		1,316,207			1,551,113
Non-controlling interest		0			29,314
Total stockholders’ equity		1,316,207			1,580,427			1,241,780			1,285,188
Total liabilities and stockholders’ equity	$	3,235,473		$	3,181,484		$	3,252,856		$	3,205,739

The accompanying notes are an integral part of these consolidated financial statements.

Three Months Ended
June 30,

Six Months Ended
June 30,

(In thousands, except per share amounts)

2019

2018

2019

2018

Revenue:

Software delivery, support and maintenance

$
285,023

$
284,485

$
560,535

$
565,038

Client services

159,437

156,979

315,974

310,148

Total revenue

444,460

441,464

876,509

875,186

Cost of revenue:

Software delivery, support and maintenance

91,351

92,938

179,484

178,948

Client services

139,957

150,174

281,556

287,262

Amortization of software development and
    acquisition-related assets

29,030

24,585

57,252

50,544

Total cost of revenue

260,338

267,697

518,292

516,754

    Gross profit

184,122

173,767

358,217

358,432

Selling, general and administrative expenses

105,542

122,913

205,787

242,850

Research and development

63,414

74,491

127,724

139,281

Asset impairment charges

3,691

30,075

3,789

30,075

Amortization of intangible and acquisition-related assets

6,732

6,382

13,529

13,021

Income (loss) from operations

4,743

(60,094
)

7,388

(66,795
)
Interest expense

(10,424
)

(11,980
)

(20,608
)

(23,674
)
Other loss, net

(144,994
)

(13
)

(144,481
)

(48
)
Gain on sale of businesses, net

0

173,129

0

172,258

(Impairment) recovery of long-term investments

0

(9,987
)

1,045

(15,487
)
Equity in net income of unconsolidated investments

218

767

154

706

(Loss) income from continuing operations before income taxes

(150,457
)

91,822

(156,502
)

66,960

Income tax benefit (provision)

527

(7,256
)

(1,405
)

(7,555
)
(Loss) income from continuing operations, net of tax

(149,930
)

84,566

(157,907
)

59,405

Loss from discontinued operations

0

(14,107
)

0

(19,123
)
Income tax effect on discontinued operations

0

3,813

0

5,475

Loss from discontinued operations, net of tax

0

(10,294
)

0

(13,648
)
Net (loss) income

(149,930
)

74,272

(157,907
)

45,757

Net loss attributable to non-controlling interests

0

2,700

424

3,490

Accretion of redemption preference on redeemable
   convertible non-controlling interest - discontinued operations

0

(12,148
)

0

(24,297
)
Net (loss) income attributable to Allscripts Healthcare
   Solutions, Inc. stockholders

$
(149,930
)

$
64,824

$
(157,483
)

$
24,950

Net (loss) income attributable to Allscripts Healthcare
   Solutions, Inc. stockholders per share:

Basic

Continuing operations

$
(0.90
)

$
0.49

$
(0.94
)

$
0.35

Discontinued operations

0.00

(0.13
)

0.00

(0.21
)
Net (loss) income attributable to Allscripts Healthcare
   Solutions, Inc. stockholders per share

$
(0.90
)

$
0.36

$
(0.94
)

$
0.14

Diluted

Continuing operations

$
(0.90
)

$
0.49

$
(0.94
)

$
0.35

Discontinued operations

0.00

(0.13
)

0.00

(0.21
)
Net (loss) income attributable to Allscripts Healthcare
   Solutions, Inc. stockholders per share

$
(0.90
)

$
0.36

$
(0.94
)

$
0.14

	Three Months Ended March 31,
(In thousands, except per share amounts)	2020			2019
Revenue:
Software delivery, support and maintenance	$	263,612		$	275,512
Client services		153,101			156,537
Total revenue		416,713			432,049
Cost of revenue:
Software delivery, support and maintenance		76,325			81,033
Client services		152,786			148,699
Amortization of software development and acquisition-related assets		30,641			28,222
Total cost of revenue		259,752			257,954
Gross profit		156,961			174,095
Selling, general and administrative expenses		97,288			100,245
Research and development		62,155			64,310
Asset impairment charges		0			98
Amortization of intangible and acquisition-related assets		6,718			6,797
(Loss) income from operations		(9,200	)		2,645
Interest expense		(12,223	)		(10,184	)
Other income, net		522			513
Recovery of long-term investments		0			1,045
Equity in net income (loss) of unconsolidated investments		200			(64	)
Loss from continuing operations before income taxes		(20,701	)		(6,045	)
Income tax benefit (provision)		347			(1,932	)
Net loss		(20,354	)		(7,977	)
Net loss attributable to non-controlling interests		0			424
Net loss attributable to Allscripts Healthcare Solutions, Inc. stockholders	$	(20,354	)	$	(7,553	)
Net loss attributable to Allscripts Healthcare Solutions, Inc. stockholders per share - Basic	$	(0.13	)	$	(0.04	)
Net loss attributable to Allscripts Healthcare Solutions, Inc. stockholders per share - Diluted	$	(0.13	)	$	(0.04	)

The accompanying notes are an integral part of these consolidated financial statements.

	Three Months Ended June 30,						Six Months Ended June 30,						Three Months Ended March 31,
(In thousands)	2019			2018			2019			2018			2020			2019
Net (loss) income	$	(149,930	)	$	74,272		$	(157,907	)	$	45,757
Net loss													$	(20,354	)	$	(7,977	)
Other comprehensive (loss) income:
Foreign currency translation adjustments		(156	)		(1,685	)		539			(1,562	)		(2,512	)		695
Change in fair value of derivatives qualifying as cash flow hedges		42			(460	)		174			(1,093	)		(473	)		132
Other comprehensive (loss) income before income tax (expense) benefit		(114	)		(2,145	)		713			(2,655	)
Income tax (expense) benefit related to items in other comprehensive (loss) income		(11	)		120			(46	)		434
Total other comprehensive income (loss)		(125	)		(2,025	)		667			(2,221	)
Comprehensive (loss) income		(150,055	)		72,247			(157,240	)		43,536
Other comprehensive income (loss) before income tax (expense) benefit														(2,985	)		827
Income tax benefit (expense) related to items in other comprehensive (loss) income														122			(35	)
Total other comprehensive (loss) income														(2,863	)		792
Comprehensive loss														(23,217	)		(7,185	)
Comprehensive loss attributable to non-controlling interests		0			2,700			424			3,490			0			424
Comprehensive (loss) income, net	$	(150,055	)	$	74,947		$	(156,816	)	$	47,026		$	(23,217	)	$	(6,761	)

The accompanying notes are an integral part of these consolidated financial statements.

	Three Months Ended June 30,						Six Months Ended June 30,						Three Months Ended March 31,
(In thousands)	2019			2018			2019			2018			2020			2019
Number of common shares
Balance at beginning of period		272,013			270,601			270,955			269,335			272,609			270,955
Common stock issued under stock compensation plans, net of shares withheld for employee taxes		459			108			1,517			1,374			875			1,058
Balance at end of period		272,472			270,709			272,472			270,709			273,484			272,013
Common stock
Balance at beginning of period	$	2,719		$	2,706		$	2,709		$	2,693		$	2,725		$	2,709
Common stock issued under stock compensation plans, net of shares withheld for employee taxes		5			1			15			14			8			10
Balance at end of period	$	2,724		$	2,707		$	2,724		$	2,707		$	2,733		$	2,719
Number of treasury stock shares
Balance at beginning of period		(105,879	)		(92,648	)		(99,731	)		(88,504	)		(110,134	)		(99,731	)
Issuance of treasury stock		61			0			61			0
Purchase of treasury stock		0			(3,527	)		(6,148	)		(7,671	)		(1,449	)		(6,148	)
Balance at end of period		(105,818	)		(96,175	)		(105,818	)		(96,175	)		(111,583	)		(105,879	)
Treasury stock
Balance at beginning of period	$	(525,613	)	$	(380,335	)	$	(460,543	)	$	(322,735	)	$	(571,157	)	$	(460,543	)
Issuance of treasury stock		846			0			846			0
Purchase of treasury stock		0			(44,306	)		(65,070	)		(101,906	)		(9,714	)		(65,070	)
Balance at end of period	$	(524,767	)	$	(424,641	)	$	(524,767	)	$	(424,641	)	$	(580,871	)	$	(525,613	)
Additional paid-in capital
Balance at beginning of period	$	1,858,319		$	1,770,801		$	1,881,494		$	1,781,059		$	1,907,348		$	1,881,494
Stock-based compensation		10,129			7,212			21,523			17,147			9,954			11,394
Common stock issued under stock compensation plans, net of shares withheld for employee taxes		(1,373	)		(114	)		(6,711	)		(8,410	)		(3,168	)		(5,338	)
Accretion of redemption preference on redeemable convertible non-controlling interest - discontinued operations		0			(12,148	)		0			(24,297	)
Subsidiary issuance of common stock		0			430			0			0
Issuance of treasury stock		(144	)		0			(144	)		0
Warrants issued		682			682			1,364			1,364			682			682
Acquisition of non-controlling interest		0			0			(29,913	)		0			0			(29,913	)
Balance at end of period	$	1,867,613		$	1,766,863		$	1,867,613		$	1,766,863		$	1,914,816		$	1,858,319
Retained earnings (accumulated deficit)
Balance at beginning of period	$	125,289		$	(319,271	)	$	132,842		$	(338,150	)	$	(49,336	)	$	132,842
Net (loss) income less net loss attributable to non-controlling interests		(149,930	)		76,972			(157,483	)		49,247
ASC 606 implementation adjustments		0			13,991			0			57,438
ASC 606 implementation adjustments - discontinued operations		0			0			0			3,157
Net loss less net loss attributable to non-controlling interests														(20,354	)		(7,553	)
ASU 2016-13 implementation adjustments														(17,953	)		0
Balance at end of period	$	(24,641	)	$	(228,308	)	$	(24,641	)	$	(228,308	)	$	(87,643	)	$	125,289
Accumulated other comprehensive loss
Balance at beginning of period	$	(4,597	)	$	(2,181	)	$	(5,389	)	$	(1,985	)	$	(4,392	)	$	(5,389	)
Foreign currency translation adjustments, net		(156	)		(1,685	)		539			(1,562	)		(2,512	)		695
Unrecognized gain (loss) on derivatives qualifying as cash flow hedges, net of tax		31			(340	)		128			(659	)
Unrecognized (loss) gain on derivatives qualifying as cash flow hedges, net of tax														(351	)		97
Balance at end of period	$	(4,722	)	$	(4,206	)	$	(4,722	)	$	(4,206	)	$	(7,255	)	$	(4,597	)
Non-controlling interest
Balance at beginning of period	$	0		$	38,400		$	29,314		$	39,190		$	0		$	29,314
Acquisition of non-controlling interest		0			(6,491	)		(28,890	)		(6,491	)		0			(28,890	)
Net loss attributable to non-controlling interests		0			(2,700	)		(424	)		(3,490	)		0			(424	)
Balance at end of period	$	0		$	29,209		$	0		$	29,209		$	0		$	0
Total Stockholders’ Equity at beginning of period	$	1,456,117		$	1,110,120		$	1,580,427		$	1,160,072		$	1,285,188		$	1,580,427
Total Stockholders’ Equity at end of period	$	1,316,207		$	1,141,624		$	1,316,207		$	1,141,624		$	1,241,780		$	1,456,117

The accompanying notes are an integral part of these consolidated financial statements.

	Six Months Ended June 30,						Three Months Ended March 31,
(In thousands)	2019			2018			2020			2019
Cash flows from operating activities:
Net (loss) income	$	(157,907	)	$	45,757
Less: Loss from discontinued operations		0			(13,648	)
(Loss) income from continuing operations		(157,907	)		59,405
Adjustments to reconcile net (loss) income to net cash provided by operating activities:
Net loss							$	(20,354	)	$	(7,977	)
Adjustments to reconcile net loss to net cash provided by operating activities:
Depreciation and amortization		100,603			95,192			52,092			50,126
Operating right-of-use asset amortization		11,007			0			5,631			5,320
Stock-based compensation expense		21,790			17,154			9,954			11,658
Deferred taxes		(1,506	)		9,669			(2,160	)		6
Asset impairment charges		3,789			30,075			0			98
(Recovery) impairment of long-term investments		(1,045	)		15,487
Equity in net loss of unconsolidated investments		(154	)		(706	)
Gain on sale of businesses, net		0			(172,258	)
Other (income) losses, net		1,992			(898	)
Recovery of long-term investments								0			(1,045	)
Other loss (income), net								287			236
Changes in operating assets and liabilities (net of businesses acquired):
Accounts receivable and contract assets, net		42,256			13,990			5,660			32,307
Prepaid expenses and other assets		(16,691	)		(9,961	)		19,669			3,658
Accounts payable		16,285			19,183			(23,967	)		7,382
Accrued expenses		146,841			5,182			10,022			(4,847	)
Accrued compensation and benefits		(47,284	)		4,374			(736	)		(39,525	)
Deferred revenue		(77,342	)		(23,282	)		724			(17,107	)
Other liabilities		(2,670	)		(1,060	)		2,933			1,380
Operating leases		(11,874	)		0			(6,174	)		(5,854	)
Net cash provided by operating activities - continuing operations		28,090			61,546
Accrued DOJ settlement								(57,289	)		0
Net cash (used in) provided by operating activities - continuing operations								(3,708	)		35,816
Net cash (used in) provided by operating activities - discontinued operations		(30,000	)		4,994			0			(30,000	)
Net cash (used in) provided by operating activities		(1,910	)		66,540			(3,708	)		5,816
Cash flows from investing activities:
Capital expenditures		(9,429	)		(14,022	)		(2,845	)		(4,847	)
Capitalized software		(55,222	)		(57,339	)		(28,556	)		(28,600	)
Cash paid for business acquisitions, net of cash acquired		(11,718	)		(177,233	)
Cash received from sale of businesses, net		0			246,801
Purchases of equity securities, other investments and related intangible assets, net		(1,159	)		(2,723	)
(Purchases) sales of equity securities, other investments and related intangible assets, net								(3,028	)		32
Other proceeds from investing activities		9			46			0			5
Net cash used in investing activities - continuing operations		(77,519	)		(4,470	)
Net cash used in investing activities - discontinued operations		0			(16,048	)
Net cash used in investing activities		(77,519	)		(20,518	)		(34,429	)		(33,410	)
Cash flows from financing activities:
Proceeds from sale or issuance of common stock		0			212
Taxes paid related to net share settlement of equity awards		(6,695	)		(8,610	)		(3,174	)		(5,327	)
Payments of lease obligations		(68	)		(254	)
Payments for issuance costs on 0.875% Convertible Senior Notes								(758	)		0
Credit facility payments		(10,000	)		(215,001	)		(80,000	)		(5,000	)
Credit facility borrowings, net of issuance costs		180,000			275,843			210,000			120,000
Repurchase of common stock		(65,070	)		(101,905	)		(9,714	)		(65,070	)
Payment of acquisition and other financing obligations		(1,473	)		(3,226	)		(2,911	)		(55	)
Purchases of subsidiary shares owned by non-controlling interest		(54,064	)		(6,945	)		0			(54,064	)
Net cash provided by (used in) financing activities - continuing operations		42,630			(59,886	)
Net cash used in financing activities - discontinued operations		0			(7,567	)
Net cash provided by (used in) financing activities		42,630			(67,453	)
Net cash provided (used in) by financing activities								113,443			(9,516	)
Effect of exchange rate changes on cash and cash equivalents		143			(291	)		(713	)		163
Net decrease in cash and cash equivalents		(36,656	)		(21,722	)
Net increase (decrease) in cash and cash equivalents								74,593			(36,947	)
Cash, cash equivalents and restricted cash, beginning of period		184,795			162,498			137,539			184,795
Cash, cash equivalents and restricted cash, end of period		148,139			140,776			212,132			147,848
Less: Cash and cash equivalents included in current assets attributable to discontinued operations		0			(14,791	)
Cash, cash equivalents and restricted cash, end of period, excluding discontinued operations	$	148,139		$	125,985

The accompanying notes are an integral part of these consolidated financial statements.

The consolidated financial statements include the accounts of Allscripts Healthcare Solutions, Inc. (“Allscripts”) and its wholly-owned subsidiaries and controlled affiliates. All significant intercompany balances and transactions have been eliminated. Each of the terms “we,” “us,” “our” or the “Company” as used herein refers collectively to Allscripts Healthcare Solutions, Inc. and its wholly-owned subsidiaries and controlled affiliates, unless otherwise stated.

The unaudited interim consolidated financial statements as of and for the three ~~and six~~ months ended ~~June 30,~~March 31, 2020 and 2019 ~~and 2018~~ have been prepared in accordance with the rules and regulations of the Securities and Exchange Commission (the “SEC”) for interim financial reporting. These interim consolidated financial statements are unaudited and, in the opinion of our management, include all adjustments, consisting of normal recurring adjustments and accruals, necessary to present fairly the consolidated financial statements for the periods presented in accordance with generally accepted accounting principles in the United States of America (“GAAP”). The consolidated results of operations for the three ~~and six~~ months ended ~~June 30, 2019~~March 31, 2020 are not necessarily indicative of the results to be expected for the full year ending December 31, ~~2019.~~2020.

Certain information and footnote disclosures normally included in annual financial statements prepared in accordance with GAAP have been condensed or omitted in accordance with the SEC's rules and regulations for interim reporting. The Company believes that the disclosures made are adequate to make these unaudited interim consolidated financial statements not misleading. They should be read in conjunction with the consolidated financial statements and related notes included in our Annual Report on Form 10-K for the year ended December 31, ~~2018~~2019 (our “Form 10-K”).

The preparation of consolidated financial statements in accordance with GAAP requires us to make estimates and assumptions that affect the amounts reported and disclosed in the consolidated financial statements and the accompanying notes. Our estimates and assumptions consider the economic implications of COVID-19 on our critical and significant accounting estimates. Actual results could differ materially from these estimates.

During the first quarter of ~~2019,~~2020, we changed our reportable segments from Provider, Veradigm and Unallocated to Core Clinical and Financial Solutions, ~~Population Health~~Data, Analytics and ~~Unallocated to Provider, Veradigm~~Care Coordination, and Unallocated. The business units reported within the historical segments have been reallocated into the new segments. Refer to Note 15 “Business Segments” for further discussion on the impact of the change.

Certain reclassifications were made to prior period amounts in order to conform to the current period presentation. These reclassifications had no impact on the reported prior period financial results.

We adopted ~~Financial Accounting Standards Board (“FASB”)~~ Accounting Standards Update No. ~~2016-02,~~ 2016-13, “~~“Leases~~Financial Instruments – Credit Losses (Topic ~~842)~~326): Measurement of Credit Losses on Financial Instruments” (“ASU ~~2016-02”~~2016-13”)on January 1, ~~2019~~2020 using the cumulative-effect adjustment transition ~~method. This~~ ~~method~~method. The guidance in ASU 2016-13 replaces the incurred loss impairment methodology under current GAAP. The new impairment model requires usimmediate recognition of estimated credit losses expected to ~~recognize an adoption impact as a cumulative-effect adjustment to the January 1, 2019 retained earnings balance.~~ ~~Prior period balances were not adjusted upon adoption of this standard. The standard requires that leased~~occur for most financial assets and ~~corresponding lease liabilities~~certain other instruments. For available-for-sale debt securities with unrealized losses, the losses will be recognized as allowances rather than reductions in the amortized cost of the securities. ASU 2016-13 is effective for annual periods beginning after December 15, 2019, and interim periods within ~~the consolidated balance sheets as right-of-use assets and operating or financing lease liabilities. Please refer~~those annual periods. Refer to Note 2 “Revenue from Contracts with Customers” and Note 3 ~~“Leases”~~“Accounts Receivable” for further discussion on the impact of ~~adoption.~~adoption.

In August ~~2017,~~2018, the ~~FASB issued~~Financial Accounting Standards ~~Update No. 2017-12,~~ ~~Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities~~Board (“~~ASU 2017-12”~~FASB”), which provides new accounting guidance to simplify and improve the reporting of hedging relationships to better portray the economic results of an entity’s risk management activities in its financial statements. In addition to that main objective, the amendments in ASU 2017-12 make certain targeted improvements to simplify the application of the hedge accounting guidance in current GAAP. ~~We adopted ASU 2017-12 on January 1, 2019, and the adoption did not have any effect on our consolidated financial statements.~~

~~In June 2018, the FASB issued Accounting Standards Update No. 2018-07, “Compensation-Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting~~” (“ASU 2018-07”), which expands the scope of Topic 718 to include share-based payment transactions for acquiring goods and services from nonemployees. ASU 2018-07 specifies that Topic 718 applies to all share-based payment transactions in which a grantor acquires goods or services to be used or consumed in its own operations by issuing share-based payment awards. ASU 2018-07 also clarifies that Topic 718 does not apply to share-based payments used to effectively provide (1) financing to the issuer or (2) awards granted in conjunction with selling goods or services to customers. We adopted this standard on January 1, 2019, and the adoption did not have any effect on our consolidated financial statements.

~~In August 2018, the FASB~~ issued Accounting Standards Update No. 2018-13, “Fair Value Measurement (Topic 820) – Disclosure Framework – Changes to the Disclosure Requirements for Fair Value Measurement” (“ASU 2018-13”), which eliminates, adds and modifies certain disclosure requirements for fair value measurements. Entities will no longer be required to disclose the amount of and reasons for transfers between Level 1 and Level 2 of the fair value hierarchy, but public companies will be required to disclose the range and weighted-average of significant unobservable inputs used to develop Level 3 fair value measurements. ASU 2018-13 will be effective for all entities for interim and annual periods beginning after December 15, 2019, with early adoption permitted. We ~~are currently evaluating~~adopted ASU 2018-13 on January 1, 2020, and the ~~disclosure~~adoption had no impact ~~of this accounting guidance.~~on our consolidated financial statements.

In ~~June 2016,~~March 2020, the FASB issued Accounting Standards Update No. ~~2016-13,~~ 2020-04, ~~Financial Instruments~~“Reference Rate Reform (Topic 848) – ~~Credit Losses (Topic 326): Measurement~~Facilitation of ~~Credit Losses~~the Effects of Reference Rate Reform on Financial ~~Instruments~~Reporting” (“ASU ~~2016-13”~~2020-04”)., which provide optional expedients and exceptions for applying GAAP to contracts, hedging relationships, and other transactions affected by reference rate reform if certain criteria are met. The ~~guidance~~amendments in ASU ~~2016-13 replaces~~2020-04 apply only to contracts, hedging relationships, and other transactions that reference LIBOR or another reference rate expected to be discontinued because of reference rate reform. ASU 2020-04 will be effective for all entities as of March 12, 2020 through December 31, 2022. We adopted ASU 2020-04 on March 12, 2020, and the ~~incurred loss impairment methodology under current GAAP. The new impairment model requires immediate~~adoption had no impact on our consolidated financial statements.

In December 2019, the FASB issued Accounting Standards Update No. 2019-12, “Income Taxes (Topic 740)” (“ASU 2019-12”), which is part of the FASB’s overall simplification initiative to reduce costs and complexity of applying accounting standards while maintaining or improving the usefulness of the information provided to users of financial statements. ASU 2019-12 simplifies accounting guidance for intraperiod allocations, deferred tax liabilities, year-to-date losses in interim periods, franchise taxes, step-up in tax basis of goodwill, separate entity financial statements and interim recognition of estimated credit losses expected to occur for most financial assets and certain other instruments. For available-for-sale debt securities with unrealized losses, the losses will be recognized as allowances rather than reductions in the amortized cost of the securities.tax laws or rate changes. ASU ~~2016-13~~2019-12 is effective for public business entities for annual reporting periods beginning after December 15, ~~2019, and interim periods within those annual periods. Early~~2020, with early adoption ~~is permitted for fiscal years beginning after December 15, 2018.~~permitted. We are currently inevaluating the ~~process~~impact of ~~evaluating~~ this ~~new guidance, which we expect to have an impact on our consolidated financial statements and results of operations.~~accounting guidance.

We do not believe that any other recently issued, but not yet effective accounting standards, if adopted, will have a material impact on our consolidated financial statements.

Our ~~two~~2 primary revenue streams are (i) software delivery, support and maintenance and (ii) client services. Software delivery, support and maintenance revenue consists of all of our proprietary software sales (either under a perpetual or term license delivery model), subscription-based software sales, transaction-related revenue, the resale of hardware and third-party software and revenue from post-contract client support and maintenance services, which include telephone support services, maintaining and upgrading software and ongoing enhanced maintenance. Client services revenue consists of revenue from managed services solutions, such as private cloud hosting, outsourcing and revenue cycle management, as well as other client services and project-based revenue from implementation, training and consulting services. For some clients, we host the software applications licensed from us using our own or third-party servers. For other clients, we offer an outsourced service in which we assume partial to total responsibility for a healthcare organization’s IT operations using our employees.

At ~~June 30, 2019~~March 31, 2020 and December 31, ~~2018,~~2019, we had capitalized costs to obtain or fulfill a contract of ~~$21.9~~$19.6 million and ~~$24.7~~$20.8 million, respectively, in Prepaid and other current assets and ~~$31.9~~$34.4 million and ~~$33.8~~$32.9 million, respectively, in Other assets. During the three months ended ~~June 30,~~March 31, 2020 and 2019, ~~and 2018,~~ we recognized ~~$7.4~~$7.5 million and ~~$7.5 million, respectively, of amortization expense related to such capitalized costs. During the six months ended June 30, 2019 and 2018, we recognized $15.0 million and $15.5~~$7.6 million, respectively, of amortization expense related to such capitalized costs. The amortization of these capitalized costs to obtain a contract are included in Selling, general and administrative expense within our consolidated statements of operations.

The timing of revenue recognition, billings and cash collections results in billed and unbilled accounts ~~receivables,~~receivable, contract assets and customer advances and deposits. Accounts receivable, net includes both billed and unbilled amounts where the right to receive payment is unconditional and only subject to the passage of time. Contract assets include amounts where revenue recognized exceeds the amount billed to the customer and the right to payment is not solely subject to the passage of time. Deferred revenue includes advanced payments and billings in excess of revenue recognized. Our contract assets and deferred revenue are reported in a net position on an individual contract basis at the end of each reporting period. Contract assets are classified as current or long-term based on the timing of when we expect to complete the related performance obligations and bill the customer. Deferred revenue is classified as current or long-term based on the timing of when we expect to recognize revenue.

The breakdown of revenue recognized ~~related~~ based on the origination of performance obligations and elected accounting expedients is presented in the table below:

(In thousands)	Three Months Ended March 31, 2019		Three Months Ended June 30, 2019		Three Months Ended March 31, 2020
Revenue related to deferred revenue balance at beginning of period	$	126,184	$	146,150	$	140,132
Revenue related to new performance obligations satisfied during the period		248,221		233,696		216,990
Revenue recognized under "right-to-invoice" expedient		55,923		62,245		58,059
Reimbursed travel expenses, shipping and other revenue		1,721		2,369		1,532
Total revenue	$	432,049	$	444,460	$	416,713

(In thousands)	Three Months Ended March 31, 2018		Three Months Ended June 30, 2018		Three Months Ended March 31, 2019
Revenue related to deferred revenue balance at beginning of period	$	181,398	$	196,163	$	126,184
Revenue related to new performance obligations satisfied during the period		200,232		180,001		248,221
Revenue recognized under "right-to-invoice" expedient		49,403		62,533		55,923
Reimbursed travel expenses, shipping and other revenue		2,689		2,767		1,721
Total revenue	$	433,722	$	441,464	$	432,049

The aggregate amount of contract transaction price related to remaining unsatisfied performance obligations (commonly referred to as “backlog”) represents contracted revenue that has not yet been recognized and includes both deferred revenue and amounts that will be invoiced and recognized as revenue in future periods. Total backlog equaled ~~$3.9~~$4.5 billion as of ~~June 30, 2019,~~March 31, 2020, of which we expect to recognize approximately ~~38%~~32% over the next 12 months, and the remaining ~~62%~~68% thereafter.

We recognize revenue only when we satisfy an identified performance obligation (or bundle of obligations) by transferring control of a promised product or service to a customer. We consider a product or service to be transferred when a customer obtains control because a customer has sole possession of the right to use (or the right to direct the use of) the product or service for the remainder of its economic life or to consume the product or service in its own operations. We evaluate the transfer of control primarily from the customer’s perspective as this reduces the risk that revenue is recognized for activities that do not transfer control to the customer.

The majority of our revenue is recognized over time because a customer continuously and simultaneously receives and consumes the benefits of our performance. The exceptions to this pattern are our sales of perpetual and term software licenses, and hardware, where we determined that a customer obtains control of the asset upon granting of access, delivery or shipment.

We disaggregate our revenue from contracts with customers based on the type of revenue and nature of revenue stream, as we believe those categories best depict how the nature, amount, timing and uncertainty of our revenue and cash flows are affected by economic factors. The below tables summarize revenue by type and nature of revenue stream as well as by our reportable segments:

	Three Months Ended June 30,				Six Months Ended June 30,				Three Months Ended March 31,
(In thousands)	2019		2018		2019		2018		2020		2019
Revenue:
Recurring revenue	$	350,113	$	361,376	$	698,749	$	714,036	$	341,219	$	348,636
Non-recurring revenue		94,347		80,088		177,760		161,150		75,494		83,413
Total revenue	$	444,460	$	441,464	$	876,509	$	875,186	$	416,713	$	432,049

	Three Months Ended June 30, 2019								Three Months Ended March 31, 2020
(In thousands)	Provider		Veradigm		Unallocated		Total		Core Clinical and Financial Solutions		Data, Analytics and Care Coordination		Unallocated Amounts		Total
Software delivery, support and maintenance	$	247,439	$	37,451	$	133	$	285,023	$	176,800	$	76,412	$	10,400	$	263,612
Client services		158,251		1,070		116		159,437		144,739		5,650		2,712		153,101
Total revenue	$	405,690	$	38,521	$	249	$	444,460	$	321,539	$	82,062	$	13,112	$	416,713

	Six Months Ended June 30, 2018									Three Months Ended March 31, 2019
(In thousands)	Provider		Veradigm		Unallocated			Total		Core Clinical and Financial Solutions		Data, Analytics and Care Coordination		Unallocated Amounts		Total
Software delivery, support and maintenance	$	511,508	$	54,222	$	(692	)	$	565,038	$	193,278	$	69,357	$	12,877	$	275,512
Client services		312,383		2,082		(4,317	)		310,148		148,618		4,902		3,017		156,537
Total revenue	$	823,891	$	56,304	$	(5,009	)	$	875,186	$	341,896	$	74,259	$	15,894	$	432,049

We adopted ASU ~~2016-02~~2016-13 on January 1, ~~2019~~2020 using the cumulative-effect adjustment transition method. The new guidance ~~requires~~required the recognition of ~~leased arrangements~~lifetime estimated credit losses expected to occur for contract assets. The guidance also requires we pool assets with similar risk characteristics and consider current economic conditions when estimating losses. The adoption of the ASU 2016-13 for contract assets was recorded as a debit to retained earnings of $5.3 million as of January 1, 2020.

At adoption, we segmented the contract asset population into pools based on their risk assessment. Risks related to contract assets are a customer’s inability to pay or bankruptcy. Each pool was defined by their internal credit assessment, and business size. The pools are aligned with management’s review of financial performance. For the ~~balance sheet as right-of-use assets and liabilities pertaining~~three months ended March 31, 2020, no adjustment to the ~~rights~~pools was necessary.

We utilized a loss-rate method to measure expected credit loss for each pool. The loss rate is calculated using a twenty-four-month lookback period of credit memos and ~~obligations created~~adjustments divided by the ~~leased assets.~~average contract asset balance for each pool during that period. We considered current economic conditions, including how the COVID-19 pandemic is impacting the global economy, internal forecasts, cash collection and credit memos written during the current period when assessing loss rates. We reviewed these factors and concluded that no adjustments should be made to the historical loss rate data. The March 31, 2020 analysis resulted in no change in the ending estimate of credit losses.

Changes in the estimate of credit losses for contract assets are presented in the table below.

We adopted ASU 2016-13 on January 1, 2020 using the cumulative-effect adjustment transition method. The new guidance required the recognition of lifetime estimated credit losses expected to occur for trade accounts receivable. The guidance also requires we pool assets with similar risk characteristics and consider current economic conditions when estimating losses. The adoption of the ASU 2016-13 for trade accounts receivable was recorded as a debit to retained earnings of $12.6 million as of January 1, 2020.

At adoption, we segmented the accounts receivable population into pools based on their risk assessment. Risks related to trade accounts receivable are a customer’s inability to pay or bankruptcy. Each pool was defined by their internal credit assessment, and business size. The pools are aligned with management’s review of financial performance. For the three months ended March 31, 2020, no adjustment to the pools was necessary.

We utilized a loss-rate method to measure expected credit loss for each pool. The loss rate is calculated using a twelve-month lookback period of credit memos and adjustments divided by the average accounts receivable balance for each pool during that period. We considered current economic conditions, including how the COVID-19 pandemic is impacting the global economy, internal forecasts, cash collection and credit memos written during the current period when assessing loss rates. We reviewed these factors and concluded that no adjustments should be made to the historical loss rate data.

Changes in the estimate of credit losses for trade accounts receivable are presented in the tables below.

We determine whether an arrangement is a lease at inception. Assets leased under an operating lease arrangement are recorded in Right-of-use assets – operating leases and the associated lease ~~liability is~~liabilities are included in Current operating lease liabilities and Long-term operating lease liabilities within the consolidated balance sheets. Assets leased under finance lease arrangements are recorded within fixed assets and the associated lease liabilities are recorded within Accrued expenses and Other liabilities within the consolidated balance sheets.

Right-of-use assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease. Operating lease right-of-use assets and liabilities are recognized at commencement date based on the present value of lease payments over the expected lease term. Since our lease arrangements do not provide an implicit rate, we use our incremental borrowing rate in conjunction with the market swap rate for the expected remaining lease team at commencement date for new leases ~~or as of January 1, 2019 for existing leases,~~ in determining the present value of future lease payments. Our expected lease terms may include options to extend or terminate the lease when it is reasonably certain that we will exercise that option. Operating lease expense is recognized on a straight-line basis over the lease term.

We have elected the group of practical expedients under ASU 2016-02 to forego assessing upon adoption: (1) whether any expired contracts are or contain leases; (2) the lease classification for any existing or expired leases and (3) any indirect costs that would have qualified for capitalization for any existing leases. We have lease agreements with lease and non-lease components, which are generally accounted for separately except for real estate and vehicle leases, which we have elected to combine through a practical expedient under ASU 2016-02. Non-lease components for our leases typically comprise of executory costs, which under the practical expedient allows for all executory costs to be recorded as lease payments. Additionally, for certain equipment leases, we apply a portfolio approach to effectively record right-of-use assets and ~~liabilities~~.liabilities.

Our operating leases mainly include office leases and our finance leases include office and computer equipment leases. Our finance leases are not significant. Our leases have remaining lease terms of approximately 1 year to 9 years, some of which include options to extend the leases for up to 5 years, which may include options to terminate the leases within 1 year. ~~Total~~Operating costs associated with leased assets are as follows:

(In thousands)	Three Months Ended June 30, 2019			Six Months Ended June 30, 2019			Three Months Ended March 31, 2020			Three Months Ended March 31, 2019
Operating lease cost ⁽¹⁾	$	7,051		$	13,768		$	6,922		$	6,717
Less: Sublease income		(778	)		(1,580	)		(603	)		(802	)
Total operating lease costs	$	6,273		$	12,188		$	6,319		$	5,915
Finance lease costs:
Amortization of right-of-use assets ⁽²⁾	$	37		$	88
Interest on lease liability ⁽³⁾		2			5
Total finance lease costs	$	39		$	93

The balance sheet location and balances for operating ~~and finance~~ leases are as follows:

The future maturities of our leasing arrangements including lease and non-lease components are shown in the below table. The maturities are calculated using foreign currency exchange rates in effect as of ~~June 30, 2019.~~March 31, 2020.

	June 30, 2019						March 31, 2020
(In thousands)	Operating Leases			Finance Leases			Operating Leases
Remainder of 2019	$	15,114		$	71
2020		26,402			85
Remainder of 2020							$	20,097
2021		21,511			40			25,996
2022		19,650			6			24,355
2023		17,164			0			22,177
2024								16,633
Thereafter		33,388			0			35,831
Total lease liabilities		133,229			202			145,089
Less: Amount representing interest		(15,611	)		(10	)		(15,111	)
Less: Short-term lease liabilities		(24,501	)		(120	)		(21,910	)
Total long-term lease liabilities	$	93,117		$	72		$	108,068

On July 2, 2019, we acquired the Pinnacle and Diabetes Collaborative Registries from the American College of Cardiology (“ACC”) as part of our broader strategic partnership with the ACC. The total purchase price was $19.7 million, consisting of an initial payment of $11.7 million plus up to an aggregate of $8.0 million pending the attainment certain milestones over the next 18 months. The contingent consideration of up to $8.0 million was valued at $5.0 million at the time of closing. As part of this partnership, we will operate Pinnacle and Diabetes Collaborative Registries, which will extend our EHR-enabled ambulatory network to create a large-scale chronic disease network. The business is included in our Data, Analytics and Care Coordination business segment.

On June 10, 2019, we acquired the assets of a business engaged in the development, implementation, customization, marketing, licensing and sale of a specialty prescription drug platform including software that collects, saves and transmits information required to fill a prescription. The drug platform and software will enable healthcare providers, pharmacists and payors to digitally interact with one another to fill a prescription. The business is included in our ~~Veradigm~~Data, Analytics and Care Coordination business segment.

On March 1, 2019, we acquired all of the outstanding minority ~~interest~~interests in Pulse8, Inc., a healthcare analytics and technology company that provides business intelligence software solutions for health plans and at-risk providers to enable them to analyze their risk adjustment and quality management programs, for $53.8 million (subject to adjustments for net working capital and a contingency holdback)~~, plus up to a $10.0 million earnout based upon revenue targets through 2019.~~. We initially acquired a controlling stake in Pulse 8, Inc. on September 8, 2016. This transaction was treated as an equity transaction and the cash payment is reported as part of cash flow from financing activities in the consolidated statement of cash flows for the ~~six~~three months ended ~~June 30,~~March 31, 2019.

On June 15, 2018, we acquired all the outstanding minority interest in a third party for $6.9 million. We initially acquired a controlling interest in the third party in April 2015. This acquisition was treated as an equity transaction and the cash payment is reported as part of cash flow from financing activities in the consolidated statements of cash flows for the six months ended June 30, 2018.

On April 2, 2018 we sold substantially all of the assets of the Allscripts’ business providing hospitals and health systems document and other content management software services generally known as “OneContent” to Hyland Software, Inc. Total consideration for the OneContent business was $260.0 million and we realized a pre-tax gain upon sale of $177.9 million, which is included in the “Gain on sale of businesses, net” line in our consolidated statements of operations for the three and six months ended June 30, 2018.

Level 1: Inputs are unadjusted quoted prices in active markets for identical assets or liabilities at the measurement date.

Level 2: ~~Inputs, other than quoted~~Quoted prices ~~included~~for similar instruments in ~~Level 1,~~active markets with inputs that are observable, ~~for the asset or liability,~~ either directly or indirectly. Our Level 2 derivative financial instruments include foreign currency forward contracts valued based upon observable values of spot and forward foreign currency exchange rates.

Level 3: Unobservable inputs are significant to the fair value of the asset or liability, and include situations where there is little, if any, market activity for the asset or liability. Our Level 3 instruments include the 1.25% Call Option asset and the 1.25% embedded cash conversion option liability that are not actively traded. The changes in unobservable inputs to the valuation pricing model used to value these instruments is not material to our consolidated results of operations. Level 3 instruments also include the fair value of contingent consideration related to completed acquisitions. The fair values are based on discounted cash flow analyses reflecting the likelihood of achieving specified performance measures or events and captures the contractual nature of the contingencies, commercial risk or time value of money.

The following table summarizes our financial assets and liabilities measured at fair value on a recurring basis as of the respective balance sheet dates:

	Balance Sheet	June 30, 2019								December 31, 2018								Balance Sheet	March 31, 2020								December 31, 2019
(In thousands)	Classifications	Level 1		Level 2		Level 3		Total		Level 1		Level 2		Level 3		Total		Classifications	Level 1		Level 2		Level 3		Total		Level 1		Level 2		Level 3		Total
Foreign exchange derivative assets	Prepaid expenses and other current assets	$	0	$	435	$	0	$	435	$	0	$	262	$	0	$	262
1.25% Call Option	Other assets		0		0		6,409		6,409		0		0		9,104		9,104	Other assets	$	0	$	0	$	0	$	0	$	0	$	0	$	84	$	84
Total assets		$	0	$	435	$	6,409	$	6,844	$	0	$	262	$	9,104	$	9,366		$	0	$	0	$	0	$	0	$	0	$	0	$	84	$	84

Foreign exchange derivative assets																		Accrued expenses	$	0	$	473	$	0	$	473	$	0	$	0	$	0	$	0
Contingent consideration - current	Accrued expenses	$	0	$	0	$	18,160	$	18,160	$	0	$	0	$	10,528	$	10,528	Accrued expenses		0		0		14,757		14,757		0		0		17,116		17,116
Contingent consideration - long-term	Other liabilities		0		0		13,928		13,928		0		0		15,317		15,317	Other liabilities		0		0		2,415		2,415		0		0		2,415		2,415
1.25% Embedded cash conversion option	Other liabilities		0		0		7,365		7,365		0		0		9,974		9,974	Other liabilities		0		0		1		1		0		0		185		185
Total liabilities		$	0	$	0	$	39,453	$	39,453	$	0	$	0	$	35,819	$	35,819		$	0	$	473	$	17,173	$	17,646	$	0	$	0	$	19,716	$	19,716

The changes in Level 3 assets and liabilities measured at fair value on a recurring basis at ~~June 30, 2019~~March 31, 2020 are summarized as follows:

(In thousands)	Contingent Consideration			1.25% Notes Call Spread Overlay			Contingent Consideration			1.25% Notes Call Spread Overlay
Balance at December 31, 2018	$	25,845		$	(870	)
Balance at December 31, 2019							$	19,531		$	(101	)
Additions		6,249			0			461			0
Payments/write-downs								(2,820	)		0
Fair value adjustments		(6	)		(86	)		0			100
Balance at June 30, 2019	$	32,088		$	(956	)
Balance at March 31, 2020							$	17,172		$	(1	)

The following table summarizes the quantitative information about our Level 3 fair value measurements at March 31, 2020:

The following table summarizes our long-term equity investments which are included in Other assets in the accompanying consolidated balance sheets:

	Number of Investees		Original		Carrying Value at				Number of Investees		Original		Carrying Value at
(In thousands, except for number of investees)	at June 30, 2019		Cost		June 30, 2019		December 31, 2018		at March 31, 2020		Cost		March 31, 2020		December 31, 2019
Equity method investments ⁽¹⁾		5	$	7,407	$	10,823	$	10,667		5	$	7,407	$	11,531	$	11,332
Cost method investments		8		37,874		28,126		25,923
Cost less impairment										9		43,874		33,278		32,462
Total long-term equity investments		13	$	45,281	$	38,949	$	36,590		14	$	51,281	$	44,809	$	43,794

As of ~~June 30, 2019,~~March 31, 2020, it is not possible to estimate the fair value of our non-marketable cost and equity method investments, primarily because of their illiquidity and restricted marketability. The factors we considered in trying to determine fair value include, but are not limited to, available financial information, the issuer’s ability to meet its current obligations, the issuer’s subsequent or planned raises of capital and observable price changes in orderly transactions.

During the ~~six~~three months ended ~~June 30,~~March 31, 2019, we recovered $1.0 million from a third-party cost-method investment that we had previously impaired ~~which was~~and is recognized in the ~~first quarter 2019.~~ Each quarter, management performs an assessment of each of our investments on an individual basis to determine if there have been any declines in fair value. As a result of this review, we recognized non-cash impairment charges during the three and six months ended June 30, 2018 of $10.0 million and $15.5 million, respectively, related to one of our cost-method equity investments and a related note receivable. These charges equaled the cost bases of the investment and note receivable prior to the impairment and are included in (Impairment) recoveryRecovery of long-term ~~investments within the consolidated statements of operations.~~investments.

Our long-term financial liabilities include amounts outstanding under our senior secured credit facility (as defined in Note 9,10, “Debt”), with carrying values that approximate fair value since the interest rates approximate current market rates. The carrying amount of our 1.25% Cash Convertible Senior Notes (the “1.25% Notes”) approximates fair value as of ~~June 30, 2019,~~March 31, 2020, since the effective interest rate on the 1.25% Notes approximates current market rates. Refer to Note 9,10, “Debt,” for further information regarding our long-term financial liabilities.

Stock-based compensation expense recognized during the three ~~and six~~ months ended ~~June 30,~~March 31, 2020 and 2019 ~~and 2018~~ is included in our consolidated statements of operations as shown in the below table. Stock-based compensation expense includes both non-cash expense related to grants of stock-based awards as well as cash expense related to the employee discount applied to purchases of our common stock under our employee stock purchase plan. NoNaN stock-based compensation costs were capitalized during the three ~~and six~~ months ended ~~June 30, 2019~~March 31, 2020 and ~~2018.~~2019.

	Three Months Ended June 30,				Six Months Ended June 30,				Three Months Ended March 31,
(In thousands)	2019		2018		2019		2018		2020		2019
Cost of revenue:
Software delivery, support and maintenance	$	614	$	444	$	1,127	$	1,040	$	575	$	513
Client services		1,163		1,098		2,256		2,506		1,091		1,093
Total cost of revenue		1,777		1,542		3,383		3,546		1,666		1,606
Selling, general and administrative expenses		6,831		5,332		15,156		11,464		7,042		8,325
Research and development		2,571		2,092		5,448		4,899		2,395		2,877
Total stock-based compensation expense	$	11,179	$	8,966	$	23,987	$	19,909	$	11,103	$	12,808

We measure stock-based compensation expense at the grant date based on the fair value of the award. We recognize the expense for service-based share awards over the requisite service period on a straight-line basis, net of estimated forfeitures. We recognize the expense for performance-based and market-based share awards over the vesting period under the accelerated attribution method, net of estimated forfeitures. In addition, we recognize stock-based compensation cost for awards with performance conditions if and when we conclude that it is probable that the performance conditions will be achieved.

The fair value of service-based and performance-based restricted stock units is measured at the underlying closing share price of our common stock on the date of grant. The fair value of market-based restricted stock units is measured using the Monte Carlo pricing model. NoNaN stock options were granted during the three ~~and six~~ months ended ~~June 30, 2019~~March 31, 2020 and ~~2018.~~2019.

	Three Months Ended June 30, 2019				Six Months Ended June 30, 2019				Three Months Ended March 31, 2020
			Weighted-Average				Weighted-Average				Weighted-Average
			Grant Date				Grant Date				Grant Date
(In thousands, except per share amounts)	Shares		Fair Value		Shares		Fair Value		Shares		Fair Value
Service-based restricted stock units		2,933	$	9.55		3,973	$	9.85		397	$	8.19
Market-based restricted stock units with a service condition		0	$	0.00		700	$	11.74		595	$	8.19
		2,933	$	9.55		4,673	$	10.14		992	$	8.19

During the ~~six~~three months ended ~~June 30, 2019~~March 31, 2020 and the year ended December 31, ~~2018, 1.5~~2019, 0.9 million and ~~1.6~~1.7 million shares of common stock, respectively, were issued in connection with the exercise of options and the release of restrictions on stock awards.

Upon vesting, restricted stock units are generally net share-settled to cover the required withholding tax and the remaining amount is converted into an equivalent number of shares of common stock. The majority of restricted stock units and awards that vested during the ~~six~~three months ended ~~June 30,~~March 31, 2020 and 2019 ~~and 2018~~ were net-share settled such that we withheld shares with fair value equivalent to the employees’ minimum statutory obligation for the applicable income and other employment taxes and remitted the cash to the appropriate taxing authorities. Total payments for the employees' minimum statutory tax obligations to the taxing authorities are reflected as a financing activity within the accompanying consolidated statements of cash flows. The total shares withheld for the ~~six~~three months ended ~~June 30,~~March 31, 2020 and 2019 ~~and 2018~~ were ~~651~~407 thousand and ~~618~~508 thousand, respectively, and were based on the value of the restricted stock units on their vesting date as determined by our closing stock price. These net-share settlements had the effect of share repurchases by us as they reduced the number of shares that would have otherwise been issued as a result of the vesting.

On ~~November 17, 2016,~~August 2, 2018, we announced that our Board of Directors approved a ~~stock purchase program (the “2016 Program”) under which we may~~ ~~repurchase up to $200 million of our common stock through December 31, 2019. On August 2, 2018, we announced that our Board approved a new~~ stock purchase program (the “2018 Program”) under which we may repurchase up to $250 million of our common stock through December 31, ~~2020, replacing~~2020. We repurchased 1.5 million of our common stock under the ~~2016 Program.~~2018 Program for a total of $9.7 million during the three months ended March 31, 2020. The approximate dollar value of shares that may yet be purchased under the 2018 Program is $92.1 million as of March 31, 2020. We repurchased 6.1 million shares of our common stock under the 2018 Program for a total of $64.9 million during the ~~six months ended June 30, 2019. We repurchased no shares during the~~ three months ended ~~June 30,~~March 31, 2019. The approximate dollar value of shares that may yet be purchased under the 2018 Program is $148.1 million as of June 30, 2019. We repurchased 7.7 million shares of our common stock under the 2016 Program for a total of $101.9 million during the six months ended June 30, 2018, of which 3.6 million shares were repurchased for a total of $44.3 million for the three months ended June 30, 2018. Any future stock repurchase transactions may be made through open market transactions, block trades, privately negotiated transactions (including accelerated share repurchase transactions) or other means, subject to market conditions. Any repurchase activity will depend on many factors such as our working capital needs, cash requirements for investments, debt repayment obligations, economic and market conditions at the time, including the price of our common stock, and other factors that we consider relevant. Our stock repurchase program may be accelerated, suspended, delayed or discontinued at any time.

Basic earnings (loss) per share is computed by dividing net income (loss) by the weighted-average shares of common stock outstanding. For purposes of calculating diluted earnings (loss) per share, the denominator includes both the weighted-average shares of common stock outstanding and dilutive common stock equivalents. Dilutive common stock equivalents consist of stock options, restricted stock unit awards and warrants calculated under the treasury stock method.

Three Months Ended
June 30,

Six Months Ended
June 30,

(In thousands, except per share amounts)

2019

2018

2019

2018

Basic earnings (loss) per Common Share:

(Loss) income from continuing operations, net of tax

$
(149,930
)

$
84,566

$
(157,907
)

$
59,405

Net loss attributable to non-controlling interests

0

2,700

424

3,490

Net (loss) income from continuing operations attributable to
   Allscripts Healthcare Solutions, Inc. stockholders

$
(149,930
)

$
87,266

$
(157,483
)

$
62,895

Loss from discontinued operations, net of tax

$
0

$
(10,294
)

$
0

$
(13,648
)
Accretion of redemption preference on redeemable
   convertible non-controlling interest - discontinued operations

0

(12,148
)

0

(24,297
)
Net loss from discontinued operations attributable to
   Allscripts Healthcare Solutions, Inc. stockholders

0

(22,442
)

0

(37,945
)
Net (loss) income attributable to Allscripts Healthcare
   Solutions, Inc. stockholders

$
(149,930
)

$
64,824

$
(157,483
)

$
24,950

Weighted-average common shares outstanding

166,522

176,363

168,230

178,113

Basic  (loss) earnings from continuing operations per
   Common Share

$
(0.90
)

$
0.49

$
(0.94
)

$
0.35

Basic loss from discontinued operations per Common Share

0.00

(0.13
)

0.00

(0.21
)
Net (loss) income attributable to Allscripts Healthcare
   Solutions, Inc. stockholders per Common Share

$
(0.90
)

$
0.36

$
(0.94
)

$
0.14

Diluted earnings (loss) per Common Share:

(Loss) income from continuing operations, net of tax

$
(149,930
)

$
84,566

$
(157,907
)

$
59,405

Net loss attributable to non-controlling interests

0

2,700

424

3,490

Net (loss) income from continuing operations attributable to
   Allscripts Healthcare Solutions, Inc. stockholders

$
(149,930
)

$
87,266

$
(157,483
)

$
62,895

Loss from discontinued operations, net of tax

$
0

$
(10,294
)

$
0

$
(13,648
)
Accretion of redemption preference on redeemable
   convertible non-controlling interest - discontinued operations

0

(12,148
)

0

(24,297
)
Net loss from discontinued operations attributable to
   Allscripts Healthcare Solutions, Inc. stockholders

0

(22,442
)

0

(37,945
)
Net (loss) income attributable to Allscripts Healthcare
   Solutions, Inc. stockholders

$
(149,930
)

$
64,824

$
(157,483
)

$
24,950

Weighted-average common shares outstanding

166,522

176,363

168,230

178,113

Plus: Dilutive effect of stock options, restricted stock unit
   awards and warrants

0

2,963

0

3,334

Weighted-average common shares outstanding assuming
   dilution

166,522

179,326

168,230

181,447

Diluted (loss) earnings from continuing operations per
   Common Share

$
(0.90
)

$
0.49

$
(0.94
)

$
0.35

Diluted loss from discontinued operations per Common Share

0.00

(0.13
)

0.00

(0.21
)
Net (loss) income attributable to Allscripts Healthcare
   Solutions, Inc. stockholders per Common Share

$
(0.90
)

$
0.36

$
(0.94
)

$
0.14

	Three Months Ended March 31,
(In thousands, except per share amounts)	2020			2019
Basic earnings (loss) per Common Share:
Net loss	$	(20,354	)	$	(7,977	)
Net loss attributable to non-controlling interests		0			424
Net loss attributable to Allscripts Healthcare Solutions, Inc. stockholders	$	(20,354	)	$	(7,553	)

Weighted-average common shares outstanding		162,461			169,957
Net loss attributable to Allscripts Healthcare Solutions, Inc. stockholders per Common Share	$	(0.13	)	$	(0.04	)

Diluted earnings (loss) per Common Share:
Net loss	$	(20,354	)	$	(7,977	)
Net loss attributable to non-controlling interests		0			424
Net loss attributable to Allscripts Healthcare Solutions, Inc. stockholders	$	(20,354	)	$	(7,553	)

Weighted-average common shares outstanding		162,461			169,957
Plus: Dilutive effect of stock options, restricted stock unit awards and warrants		0			0
Weighted-average common shares outstanding assuming dilution		162,461			169,957
Net loss attributable to Allscripts Healthcare Solutions, Inc. stockholders per Common Share	$	(0.13	)	$	(0.04	)

Due to the net loss attributable to Allscripts Healthcare Solutions, Inc. stockholders for the three ~~and six~~ months ended ~~June 30,~~March 31, 2020 and 2019, we used basic weighted-average common shares outstanding in the calculation of diluted loss per share for those periods, since the inclusion of any stock equivalents would be anti-dilutive.

The following stock options, restricted stock unit awards and warrants are not included in the computation of diluted earnings (loss) per share as the effect of including such stock options, restricted stock unit awards and warrants in the computation would be anti-dilutive:

Three Months Ended

June 30,

Six Months Ended

June 30,

Three Months Ended

March 31,

(In thousands)

2019

2018

2019

2018

2020

2019

Shares subject to anti-dilutive stock options, restricted stock

unit awards and warrants excluded from calculation

29,720

26,044

27,358

24,318

48,032

26,738

	June 30, 2019							December 31, 2018							March 31, 2020							December 31, 2019
	Gross							Gross							Gross							Gross
	Carrying		Accumulated			Intangible		Carrying		Accumulated			Intangible		Carrying		Accumulated			Intangible		Carrying		Accumulated			Intangible
(In thousands)	Amount		Amortization			Assets, Net		Amount		Amortization			Assets, Net		Amount		Amortization			Assets, Net		Amount		Amortization			Assets, Net
Intangibles subject to amortization:
Proprietary technology	$	539,234	$	(419,105	)	$	120,129	$	537,834	$	(401,093	)	$	136,741	$	546,047	$	(446,033	)	$	100,014	$	546,373	$	(437,640	)	$	108,733
Customer contracts and relationships		706,643		(475,989	)		230,654		704,808		(462,468	)		242,340		701,322		(495,027	)		206,295		702,034		(488,625	)		213,409
Total	$	1,245,877	$	(895,094	)	$	350,783	$	1,242,642	$	(863,561	)	$	379,081	$	1,247,369	$	(941,060	)	$	306,309	$	1,248,407	$	(926,265	)	$	322,142

Intangibles not subject to amortization:
Registered trademarks						$	52,000						$	52,000						$	52,000						$	52,000
Goodwill							1,382,244							1,373,744							1,361,115							1,362,017
Total						$	1,434,244						$	1,425,744						$	1,413,115						$	1,414,017

Changes in the carrying amounts of goodwill by reportable segment for the ~~six~~three months ended ~~June 30, 2019~~March 31, 2020 were as follows:

There are ~~$13.5~~$39.2 million in accumulated impairment losses associated with our goodwill as of ~~June 30, 2019~~March 31, 2020 and December 31, ~~2018. Additions to goodwill in 2019 resulted from the purchase of a prescription drug software company and the goodwill is expected to be deductible for tax purposes.~~2019.

	June 30, 2019						December 31, 2018						March 31, 2020						December 31, 2019
(In thousands)	Principal Balance		Unamortized Discount and Debt Issuance Costs		Net Carrying Amount		Principal Balance		Unamortized Discount and Debt Issuance Costs		Net Carrying Amount		Principal Balance		Unamortized Discount and Debt Issuance Costs		Net Carrying Amount		Principal Balance		Unamortized Discount and Debt Issuance Costs		Net Carrying Amount
0.875% Convertible Senior Notes ⁽¹⁾													$	177,942	$	3,185	$	174,757	$	177,942	$	4,697	$	173,245
1.25% Cash Convertible Senior Notes	$	345,000	$	14,921	$	330,079	$	345,000	$	22,112	$	322,888		345,000		3,776		341,224		345,000		7,552		337,448
Senior Secured Credit Facility		520,000		5,283		514,717		350,000		6,038		343,962		540,000		4,796		535,204		410,000		5,224		404,776
Other debt		49		0		49		748		0		748
Total debt	$	865,049	$	20,204	$	844,845	$	695,748	$	28,150	$	667,598	$	1,062,942	$	11,757	$	1,051,185	$	932,942	$	17,473	$	915,469
Less: Debt payable within one year		22,548		427		22,121		20,538		479		20,059		371,519		768		370,751		364,653		188		364,465
Total long-term debt, less current maturities	$	842,501	$	19,777	$	822,724	$	675,210	$	27,671	$	647,539	$	691,423	$	10,989	$	680,434	$	568,289	$	17,285	$	551,004

	Three Months Ended June 30,				Six Months Ended June 30,				Three Months Ended March 31,
(In thousands)	2019		2018		2019		2018		2020		2019
Interest expense	$	6,434	$	8,146	$	12,663	$	16,084	$	6,507	$	6,229
Amortization of discounts and debt issuance costs		3,990		3,834		7,945		7,590		5,716		3,955
Total interest expense	$	10,424	$	11,980	$	20,608	$	23,674	$	12,223	$	10,184

Interest expense related to 0.875% Convertible Senior Notes and the 1.25% Cash Convertible Senior Notes, ~~(the “1.25% Notes”),~~ included in the table above, ~~consists~~consisted of the following:

	Three Months Ended June 30,				Six Months Ended June 30,				Three Months Ended March 31,
(In thousands)	2019		2018		2019		2018		2020		2019
Coupon interest at 1.25%	$	1,078	$	1,078	$	2,156	$	2,156
Coupon interest									$	1,555	$	1,078
Amortization of discounts and debt issuance costs		3,614		3,442		7,191		6,849		5,288		3,577
Total interest expense related to the 1.25% Notes	$	4,692	$	4,520	$	9,347	$	9,005
Total interest expense related to the convertible notes									$	6,843	$	4,655

On February 15, 2018, Allscripts and Healthcare LLC entered into a Second Amended and Restated Credit Agreement (the “Second Amended Credit Agreement”), with JPMorgan Chase Bank, N.A., as administrative agent. The Second Amended Credit Agreement provides for a $400 million senior secured term loan (the “Term Loan”) and a $900 million senior secured revolving facility (the “Revolving Facility”), each with a five-year term. The Term Loan is repayable in quarterly installments, which began on June 30, 2018. A total of up to $50 million of the Revolving Facility is available for the issuance of letters of credit, up to $10 million of the Revolving Facility is available for swingline loans, and up to $100 million of the Revolving Facility could be borrowed under certain foreign currencies.

As of ~~June 30, 2019, $340.0~~March 31, 2020, $325.0 million under the Term Loan, ~~$180.0~~$215.0 million under the Revolving Facility, and $1.0 million in letters of credit were outstanding under the Second Amended Credit Agreement.

As of ~~June 30, 2019,~~March 31, 2020, the interest rate on the borrowings under the Second Amended Credit Agreement was LIBOR plus ~~1.50%~~1.75%, which totaled ~~3.90%~~2.74%. We were in compliance with all covenants under the Second Amended Credit Agreement as of ~~June 30, 2019.~~March 31, 2020.

On August 7, 2019, we entered into a First Amendment to the Second Amended Credit Agreement in order to remain compliant with the covenants of our Second Amended Credit Agreement. ~~Refer to Note 17, “Subsequent Events.”~~ The First Amendment ~~provides~~provided the financial flexibility to settle the U.S. Department of Justice’s investigations as discussed in Note ~~13,~~14, “Contingencies” while maintaining our compliance with ~~financial covenants.~~the covenants of our Second Amended Credit Agreement. None of the original terms of our Second Amended Credit Agreement relating to scheduled future principal payments, applicable interest rates and margins or borrowing capacity under our Revolving Facility were amended. In connection with this amendment, we incurred fees and other costs totaling $0.8 million, of which a majority was capitalized.

As of ~~June 30, 2019,~~March 31, 2020, we had ~~$719.0~~$684.0 million available, net of outstanding letters of credit, under our Revolving Facility. There can be no assurance that we will be able to draw on the full available balance of our Revolving Facility if the financial institutions that have extended such credit commitments become unwilling or unable to fund such ~~borrowings.~~borrowings or if we are unable to maintain compliance with applicable covenants.

The issuance in December 2019 of the combined $218.0 million aggregate principal amount of the 0.875% Convertible Senior Notes resulted in $0.7 million in debt issuance costs, which were paid in January 2020. We have separately recorded liability and equity components of the 0.875% Convertible Senior Notes, including any discounts and issuance costs, by allocating the proceeds from the issuance between the liability component and the embedded conversion option, or equity component. This allocation was completed by first estimating an interest rate at the time of issuance for similar notes that do not include an embedded conversion option. The interest rate of 1.95% was used to compute the initial fair value of the liability component, which totaled $177.9 million at the time of issuance. The excess of the initial proceeds received from the 0.875% Convertible Senior Notes and the $177.9 million liability component was allocated to the equity component, which totaled $40.1 million at the time of issuance before deducting any paid capped call fees. The equity component of $40.1 million, the $17.2 million in paid capped call fees and an allocation of $1.1 million in combined discounts and issuance costs were recorded in Additional paid-in capital within the consolidated balance sheets in December 2019. These were recorded as a discount that will be accreted into interest expense through January 1, 2027 using the interest method. The carrying value of the combined equity component, net of capped call fees, issuance costs and accretion, totaled $20.0 million as of March 31, 2020.

As of ~~June 30, 2019,~~March 31, 2020, the if-converted value of the 1.25% Notes did not exceed the 1.25% Notes’ principal amount.

The following table summarizes future debt payment obligations as of ~~June 30, 2019:~~March 31, 2020:


(In thousands)	Total		Remainder of 2019		2020		2021		2022		2023		Thereafter		Total		Remainder of 2020		2021		2022		2023		2024		Thereafter
1.25% Cash Convertible Senior Notes ⁽¹⁾	$	345,000	$	0	$	345,000	$	0	$	0	$	0	$	0
0.875% Convertible Senior Notes ⁽¹⁾															$	218,000	$	0	$	0	$	0	$	0	$	0	$	218,000
1.25% Cash Convertible Senior Notes ⁽²⁾																345,000		345,000		0		0		0		0		0
Term Loan		340,000		10,000		27,500		30,000		37,500		235,000		0		325,000		22,500		30,000		37,500		235,000		0		0
Revolving Facility ⁽²⁾		180,000		0		0		0		0		180,000		0
Other debt		49		49		0		0		0		0		0
Revolving Facility ⁽³⁾																215,000		0		0		0		215,000		0		0
Total debt	$	865,049	$	10,049	$	372,500	$	30,000	$	37,500	$	415,000	$	0	$	1,103,000	$	367,500	$	30,000	$	37,500	$	450,000	$	0	$	218,000

⁽¹⁾ ~~Assumes no cash conversions of the 1.25% Notes prior to their maturity on July 1, 2020.~~

We account for income taxes under FASB Accounting Standards Codification 740, “Income ~~Taxes~~Taxes” (“ASC 740”). We calculate the quarterly tax provision consistent with the guidance provided by ASC 740-270, whereby we forecast the estimated annual effective tax rate and then apply that rate to the year-to-date pre-tax book (loss) income. The effective tax rate may be subject to fluctuations during the year as new information is obtained, which may affect the assumptions used to estimate the annual effective rate, including factors such as the valuation allowances against deferred tax assets, the recognition or de-recognition of tax benefits related to uncertain tax positions, or changes in or the interpretation of tax laws in jurisdictions where the Company conducts business. There is no tax benefit recognized on certain of the net operating losses incurred due to insufficient evidence supporting the Company’s ability to use these losses in the future. The effective tax rates were as follows:

	Three Months Ended June 30,						Six Months Ended June 30,						Three Months Ended March 31,
(In thousands)	2019			2018			2019			2018
(Loss) income from continuing operations before income taxes	$	(150,457	)	$	91,822		$	(156,502	)	$	66,960
(In thousands, except effective tax rate)													2020			2019
Loss from continuing operations before income taxes													$	(20,701	)	$	(6,045	)
Income tax benefit (provision)	$	527		$	(7,256	)	$	(1,405	)	$	(7,555	)	$	347		$	(1,932	)
Effective tax rate		0.4	%		7.9	%		(0.9	%)		11.3	%		1.7	%		(32.0	%)

Our provision for income taxes differs from the tax computed at the U.S. federal statutory income tax rate primarily due to permanent differences, income attributable to foreign jurisdictions taxed at different rates, state taxes, tax credits and certain discrete items. Our effective tax rate for the three ~~and six~~ months ended ~~June 30, 2019,~~March 31, 2020, compared with the prior year comparable ~~periods,~~period, differs primarily due to ~~higher tax shortfalls associated with stock-based compensation reflected~~the fact that the permanent items, credits and the impact of foreign earnings had less impact on the pre-tax loss of $20.7 million in the ~~provision~~three months ended March 31, 2020, compared to the impacts of these items on a pre-tax loss of $6.0 million for the three ~~and six~~ months ended ~~June 30, 2019 and release of valuation allowance of $18 million recorded in the six months ended June 30, 2018.~~March 31, 2019.

In evaluating our ability to recover our deferred tax assets within the jurisdictions from which they arise, we consider all available evidence, including scheduled reversals of deferred tax liabilities, tax-planning strategies, and results of recent operations. In evaluating the objective evidence that historical results provide, we consider three years of cumulative operating income (loss). During the three months ended ~~June 30, 2019,~~March 31, 2020, we recorded ~~immaterial impacts for~~ valuation ~~allowances.~~allowances of $1.6 million related to U.S. and foreign net operating loss carryforwards.

Our unrecognized income tax benefits were ~~$20.8~~$21.6 million and ~~$19.8~~$20.6 million as of ~~June 30, 2019~~March 31, 2020 and December 31, ~~2018,~~2019, respectively. If any portion of our unrecognized tax benefits is recognized, it could impact our effective tax rate. The tax reserves are reviewed periodically and adjusted considering changing facts and circumstances, such as progress of tax audits, lapse of applicable statutes of limitations and changes in tax law.

The following tables provide information about the fair values of our derivative financial instruments as of the respective balance sheet dates:

June 30, 2019

March 31, 2020

Asset Derivatives

Liability Derivatives

Asset Derivatives

Liability Derivatives

(In thousands)

Balance Sheet Location

Fair Value

Balance Sheet Location

Fair Value

Balance Sheet Location

Fair Value

Balance Sheet Location

Fair Value

Derivatives qualifying as cash flow hedges:

Foreign exchange contracts

Prepaid expenses and

other current assets

435

Accrued expenses

Prepaid expenses and

other current assets

Accrued expenses

473

Derivatives not subject to hedge accounting:

1.25% Call Option

Other assets

6,409

N/A

Other assets

N/A

1.25% Embedded cash conversion option

N/A

Other liabilities

7,365

N/A

Other liabilities

Total derivatives

6,844

7,365

474

December 31, 2018

December 31, 2019

Asset Derivatives

Liability Derivatives

Asset Derivatives

Liability Derivatives

(In thousands)

Balance Sheet Location

Fair Value

Balance Sheet Location

Fair Value

Balance Sheet Location

Fair Value

Balance Sheet Location

Fair Value

Derivatives qualifying as cash flow hedges:

Foreign exchange contracts

Prepaid expenses and

other current assets

262

Accrued expenses

Prepaid expenses and

other current assets

Accrued expenses

Derivatives not subject to hedge accounting:

1.25% Call Option

Other assets

9,104

N/A

Other assets

N/A

1.25% Embedded cash conversion option

N/A

Other liabilities

9,974

N/A

Other liabilities

185

Total derivatives

9,366

9,974

185

We have entered into non-deliverable forward foreign currency exchange contracts with reputable banking counterparties to hedge a portion of our forecasted future Indian Rupee-denominated (“INR”) expenses against foreign currency fluctuations between the United States dollar and the INR. These forward contracts cover a percentage of forecasted monthly INR expenses over time. As of ~~June 30, 2019,~~March 31, 2020, there were 69 forward contracts outstanding that were staggered to mature monthly starting in ~~July 2019~~April 2020 and ending in December ~~2019.~~2020. In the future, we may enter into additional forward contracts to increase the amount of hedged monthly INR expenses or initiate hedges for monthly periods beyond December ~~2019.~~2020. As of ~~June 30, 2019,~~March 31, 2020, the notional amount for each of the outstanding forward contracts was ~~160~~280 million INR, or the equivalent of ~~$2.3~~$3.7 million, based on the exchange rate between the United States dollar and the INR in effect as of ~~June 30, 2019.~~March 31, 2020. These amounts also approximate the forecasted future INR expenses we target to hedge in any one month in the future. As of ~~June 30, 2019,~~March 31, 2020, we estimate that ~~$0.4~~$0.5 million of net unrealized derivative ~~gains~~losses included in ~~AOCI~~accumulated other comprehensive income (“AOCI”) will be reclassified into income within the next ~~twelve~~nine months.

The following tables show the impact of derivative instruments designated as cash flow hedges on the consolidated statements of operations and the consolidated statements of comprehensive loss:

	Amount of Gain (Loss) Recognized in OCI					Amount of Gain (Loss) Reclassified from AOCI into Income				Amount of Gain (Loss) Recognized in OCI				Amount of Gain (Loss) Reclassified from AOCI into Income
(In thousands)	Three Months Ended June 30, 2019		Six Months Ended June 30, 2019		Location of Gain (Loss) Reclassified from AOCI into Income	Three Months Ended June 30, 2019		Six Months Ended June 30, 2019		Three Months Ended March 31, 2020			Location of Gain (Loss) Reclassified from AOCI into Income	Three Months Ended March 31, 2020
Foreign exchange contracts	$	189	$	340	Cost of Revenue	$	53	$	60	$	(473	)	Cost of Revenue	$	0
					Selling, general and administrative expenses		36		41				Selling, general and administrative expenses		0
					Research and development	$	59	$	66				Research and development	$	0

	Amount of Gain (Loss) Recognized in OCI							Amount of Gain (Loss) Reclassified from AOCI into Income				Amount of Gain (Loss) Recognized in OCI			Amount of Gain (Loss) Reclassified from AOCI into Income
(In thousands)	Three Months Ended June 30, 2018			Six Months Ended June 30, 2018			Location of Gain (Loss) Reclassified from AOCI into Income	Three Months Ended June 30, 2018		Six Months Ended June 30, 2018		Three Months Ended March 31, 2019		Location of Gain (Loss) Reclassified from AOCI into Income	Three Months Ended March 31, 2019
Foreign exchange contracts	$	(129	)	$	(207	)	Cost of Revenue	$	112	$	301	$	151	Cost of Revenue	$	7
							Selling, general and administrative expenses		86		230			Selling, general and administrative expenses		5
							Research and development	$	133	$	355			Research and development	$	7

In June 2013, concurrent with the issuance of the 1.25% Notes, we entered into privately negotiated hedge transactions with certain of the initial purchasers of the 1.25% Notes (collectively, the “1.25% Call Option”). Assuming full performance by the counterparties, the 1.25% Call Option is intended to offset cash payments in excess of the principal amount due upon any conversion of the 1.25% Notes.

The 1.25% Call Option, which is indexed to our common stock, is a derivative asset that requires mark-to-market accounting treatment (due to the cash settlement features) until the 1.25% Call Option settles or expires. The 1.25% Call Option is measured and reported at fair value on a recurring basis, within Level 3 of the fair value hierarchy.

The 1.25% Call Option does not qualify for hedge accounting treatment. Therefore, the change in fair value of these instruments is recognized immediately in our consolidated statements of operations in Other income, net. Because the terms of the 1.25% Call Option are substantially similar to those of the 1.25% Notes embedded cash conversion option, discussed below, we expect the net effect of those two derivative instruments on our earnings to be minimal.

The embedded cash conversion option within the 1.25% Notes is required to be separated from the 1.25% Notes and accounted for separately as a derivative liability, with changes in fair value reported in our consolidated statements of operations in Other income, net until the cash conversion option settles or expires. The initial fair value liability of the embedded cash conversion option was $82.8 million, which simultaneously reduced the carrying value of the 1.25% Notes (effectively an original issuance discount). The embedded cash conversion option is measured and reported at fair value on a recurring basis, within Level 3 of the fair value hierarchy.

The following table shows the net impact of the changes in fair values of the 1.25% Call Option and the 1.25% Notes’ embedded cash conversion option in the consolidated statements of operations:

	Three Months Ended June 30,						Six Months Ended June 30,						Three Months Ended March 31,
(In thousands)	2019			2018			2019			2018			2020			2019
1.25% Call Option	$	3,379		$	(6,983	)	$	(2,695	)	$	(28,151	)	$	(84	)	$	(6,074	)
1.25% Embedded cash conversion option		(3,840	)		7,042			2,609			28,373			184			6,449
Net (loss) income included in other income, net	$	(461	)	$	59		$	(86	)	$	222
Net income included in Other income, net													$	100		$	375

Changes in the balances of each component included in AOCI are presented in the tables below. All amounts are net of tax and exclude non-controlling interest.

⁽¹⁾ Net of taxes of ~~$445~~$149 thousand arising from the revaluation of tax effects included in AOCI.

⁽²⁾Net of taxes of $122 thousand for unrealized net losses on foreign exchange contract derivatives.

⁽¹⁾Net of taxes of $68 thousand for unrealized net gains on foreign exchange contract ~~derivatives.~~derivatives and $149 thousand arising from the revaluation of tax effects included in AOCI.

⁽²⁾Net of taxes of ~~$11~~$102 thousand for unrealized net losses on foreign exchange contract derivatives.

The following tables reflect the tax effects allocated to each component of other comprehensive income (loss) (“OCI”):

Six Months Ended June 30,

2019

2018

(In thousands)

Before-Tax Amount

Tax Effect

Net Amount

Before-Tax Amount

Tax Effect

Net Amount

Foreign currency translation adjustments

$
539

$
0

$
539

$
(1,562
)

$
0

$
(1,562
)
Derivatives qualifying as cash flow hedges:

Foreign exchange contracts:

Net (losses) gains arising during the period

340

(89
)

251

(207
)

54

(153
)
Net (gains) losses reclassified into income ⁽¹⁾

(166
)

43

(123
)

(886
)

380

(506
)
Net change in unrealized (losses) gains on foreign exchange contracts

174

(46
)

128

(1,093
)

434

(659
)
Net (loss) gain on cash flow hedges

174

(46
)

128

(1,093
)

434

(659
)
Other comprehensive (loss) income

$
713

$
(46
)

$
667

$
(2,655
)

$
434

$
(2,221
)

In addition to commitments and obligations in the ordinary course of business, we are currently subject to various legal proceedings and claims that have not been fully adjudicated. We intend to vigorously defend ourselves, as appropriate, in these matters.

No less than quarterly, we review the status of each significant matter and assess our potential financial exposure. We accrue a liability for an estimated loss if the potential loss from any legal proceeding or claim is considered probable and the amount can be reasonably estimated. Significant judgment is required in both the determination of probability and the determination as to whether the amount of an exposure is reasonably estimable, and accruals are based only on the information available to our management at the time the judgment is made.

The outcome of legal proceedings is inherently uncertain, and we may incur substantial defense costs and expenses defending any of these matters. In the opinion of our management, except as set forth below with respected to the expected resolution of the Practice Fusion investigations, the ultimate disposition of pending legal proceedings or claims will not have a material adverse effect on our consolidated financial position, liquidity or results of operations. However, if one or more of these additional legal proceedings were resolved against or settled by us in a reporting period for amounts in excess of our management’s expectations, our consolidated financial statements for that and subsequent reporting periods could be materially adversely affected. Additionally, the resolution of a legal proceeding against us could prevent us from offering our products and services to current or prospective clients or cause us to incur increased compliance costs, either of which could further adversely affect our operating results.

On May 1, 2012, Physicians Healthsource, Inc. filed a class action complaint in the U.S. District Court for the Northern District of Illinois against us. The complaint alleges that, on multiple occasions between July 2008 and December 2011, we or our agent sent advertisements by fax to the plaintiff and a class of similarly situated persons, without first receiving the recipients’ express permission or invitation in violation of the Telephone Consumer Protection Act, 47 U.S.C. § 227 (the “TCPA”). The plaintiff sought $500 for each alleged violation of the TCPA, treble damages if the Court finds the violations to be willful, knowing or intentional, and injunctive and other relief. Allscripts answered the complaint denying all material allegations and asserting a number of affirmative defenses, as well as counterclaims for breach of a license agreement. On March 31, 2016, plaintiff filed its motion for class certification. On May 31, 2016, we filed our opposition to plaintiff’s motion for class certification, and simultaneously moved for summary judgment on all of plaintiff’s claims. On June 2, 2017, an order was entered denying class certification and, accordingly, the case will not proceed on a class-wide basis.

The Enterprise Information Solutions business (the “EIS Business”) acquired from McKesson Corporation (“McKesson”) on October 2, 2017 is subject to a May 2017 civil investigative demand (“CID”) from the U.S. Attorney’s Office for the Eastern District of New York. The CID requests documents and information related to the certification McKesson obtained for Horizon Clinicals in connection with the U.S. Department of Health and Human Services’ Electronic Health Record Incentive Program. In August 2018, McKesson received an additional CID seeking similar information for Paragon. McKesson has agreed, with respect to the CIDs, to indemnify Allscripts for amounts paid or payable to the government (or any private relator) involving any products or services marketed, sold or licensed by the EIS Business as of or prior to the closing of the acquisition.

Practice Fusion, acquired by Allscripts on February 13, 2018, received in March 2017 a request for documents and information from the U.S. Attorney’s Office for the District of Vermont pursuant to a CID. Between April 2018 and June 2019, Practice Fusion received from the U.S. Department of Justice (the “DOJ”) seven additional requests for documents and information through four additional CIDs and three Health Insurance Portability and Accountability Act (“HIPAA”) subpoenas. The document and information requests received by Practice Fusion related to both the certification Practice Fusion obtained in connection with the U.S. Department of Health and Human Services’ Electronic Health Record Incentive Program and Practice Fusion’s compliance with the Anti-Kickback Statute (“AKS”) and HIPAA as it relates to certain business practices engaged in by Practice Fusion. In March 2019, Practice Fusion received a grand jury subpoena in connection with a criminal investigation related to Practice Fusion’s compliance with the ~~Anti-Kickback Statute.~~AKS. On August 6, 2019, Practice Fusion reached an agreement in principle with the DOJ to resolve all of the DOJ’s outstanding civil and criminal investigations, including the investigation by the U.S. Attorney’s Office for the District of ~~Vermont. The terms of this agreement in principle, which is subject to final negotiation of settlement documents with the government, contemplate~~Vermont, and we announced that on January 27, 2020, Practice Fusion ~~will pay $145.0 million and enter~~entered into a deferred prosecution agreement and various civil settlement agreements, including with the Medicaid programs for each U.S. state, the District of Columbia and Puerto Rico (collectively, the “Settlement Agreements”) resolving the investigations conducted by the DOJ and the U.S. Attorney’s Office. The Settlement Agreements require Practice Fusion to, among other matters, pay a criminal fine of $25.3 million, a forfeiture payment of $959,700 and a civil settlement ~~agreement. Other non-financial~~of $118.6 million, which includes $5.2 million designated for the state Medicaid program expenditures. The terms of Settlement Agreements resolved, among other things, allegations that Practice Fusion, long before its acquisition by Allscripts and ~~conditions remain subject~~concerning conduct about which Allscripts was unaware at the time of the acquisition, violated the AKS through the manner by which a sponsored Clinical Decision Support arrangement was sold to ~~negotiation,~~an opioid manufacturer and other AKS allegations made by the DOJ against Practice Fusion, as well as False Claims Act allegations pertaining to Meaningful Use payments the federal government made to users of Practice Fusion’s EHR system. In April 2020, Practice Fusion amended its civil settlement agreement with the DOJ by revising the timing of certain of the payments required to be made by Practice Fusion. Pursuant to the amendment, the Federal settlement amounts that were otherwise owed in the Company’s second and third fiscal quarters were reduced by half, and the ~~terms described above may change following further negotiation. The agreement in principle and~~balance of the ~~final settlement materials are subject to approval of supervisory personnel within the DOJ. The proposed~~Federal settlement amount ~~is included~~owed by Practice Fusion will become due in ~~Other loss, net within the consolidated statements of operations and Accrued expenses within the consolidated balance sheets as of and for the three months ended June 30, 2019.~~

On January ~~25, 2018, a complaint was filed in~~ ~~Surfside Non-Surgical Orthopedics, P.A. v. Allscripts Healthcare Solutions, Inc.~~, No. 1:18-cv-00566, in the Northern District of Illinois. This is a purported class action lawsuit related to a January 18, 2018 ransomware attack, and alleges the following counts: (1) negligence, gross negligence and negligence per se; (2) breach of contract; (3) unjust enrichment; (4) violation of the Illinois Consumer Fraud Act; and (5) violation of the Illinois Deceptive Trade Practices Act. Plaintiff seeks to represent a class of customers seeking damages from Allscripts. Allscripts has moved to dismiss the plaintiff’s complaint. In June 2019, the court granted Allscripts motion to dismiss the plaintiff’s complaint and entered judgment in favor of Allscripts.2021.

On December 31, 2018, we sold all of the Class A Common Units of Netsmart LLC, a Delaware limited liability company (“Netsmart”), held by the Company. Prior to the sale, Netsmart comprised a separate reportable segment, which due to its significance to our historical consolidated financial statements and results of operations, is reported as a discontinued operation due to the sale.

~~The following table summarizes Netsmart’s major income and expense line items as reported in the consolidated statements of operations for the three and six months ended June 30, 2018:~~

Two of the product offerings (Horizon Clinicals and Series2000 Revenue Cycle) acquired with the business combination with the EIS Business were sunset after March 31, 2018. The decision to discontinue maintaining and supporting these solutions was made prior to our acquisition of the EIS Business and, therefore, are presented below as discontinued operations. Until the end of the first quarter of 2018, we were involved in ongoing maintenance and support for these solutions until customers have transitioned to other platforms. No disposal gains or losses were recognized during the 2018 fiscal year related to these discontinued operations. We had $0.9 million of accrued expenses associated with the Horizon Clinicals and Series2000 Revenue Cycle businesses on the consolidated balance sheets as of December 31, 2018.

The following table summarizes the major classes of line items constituting income (loss) of the discontinued operations with the sunset businesses of Horizon Clinicals and Series2000 Revenue Cycle, as reported in the consolidated statements of operations for the three and six months ended June 30, 2018:

We primarily derive our revenues from sales of our proprietary software (either as a direct license sale or under a subscription delivery model), which also serves as the basis for our recurring service contracts for software support and maintenance and certain transaction-related services. In addition, we provide various other client services, including installation, and managed services such as outsourcing, private cloud hosting and revenue cycle management.

During the first quarter of ~~2019,~~2020, we realigned our reporting structure ~~as a result~~to organize the Company around strategic business units to maximize delivery of ~~the divestiture of our investment in Netsmart on December 31, 2018, the evolution of the healthcare IT industry~~client commitments, operational effectiveness and ~~our increased focus on the payer and life sciences market.~~competitiveness. As a result, we changed the presentation of our reportable segments to Provider and Veradigm. The new Provider segment is comprised of our core integrated clinical software applications, financial management and patient engagement solutions targeted at clients across the entire continuum of care. The new Veradigm segment primarily focuses on the payer and life sciences market. These changes to our reportable segments had no impact on operating segments. The segment disclosures below for the three and six months ended June 30, 2018, have ~~been revised to conform to the current year presentation.~~

~~As of June 30, 2019, we had eight~~3 operating segments, ~~which~~(i) Core Clinical and Financial Solutions, (ii) Data, Analytics and Care Coordination and (iii) EPSi^TM. The Core Clinical and Financial Solutions and Data, Analytics and Care Coordination operating segments are ~~aggregated into two~~the equivalent to the reportable segments. The ~~Provider~~new reportable ~~segment includes the Hospitals~~segments are (i) Core Clinical and ~~Health Systems, Ambulatory, CarePort, FollowMyHealth~~^®~~, EPSi~~^TM~~, EIS-Classics~~Financial Solutions and ~~2bPrecise strategic business units, each of which represents a separate operating segment. This reportable~~(ii) Data, Analytics and Care Coordination. The new Core Clinical and Financial Solutions segment derives its revenue from the sale of integrated clinical software applications and financial management ~~and patient engagement~~ solutions, which primarily include EHR-related software, ~~connectivity and coordinated care solutions,~~ financial and practice management software, related installation, support and maintenance, outsourcing, private cloud hosting and revenue cycle ~~management, training~~management. The new Data, Analytics and ~~electronic claims administration services. The Veradigm reportable~~Care Coordination segment ~~is comprised~~derives its revenue from the sale of ~~the Veradigm business unit,~~patient engagement, care coordination, and payer and life sciences solutions, which ~~represents a separate operating segment. This reportable segment provides data-driven clinical insights with actionable tools for clinical workflow, research, analytics and media. Its solutions,~~are mainly targeted at hospitals, health systems, other care facilities, payers, life sciences companies and other key healthcare ~~stakeholders, help~~stakeholders. These solutions enable clients to transition, analyze, coordinate care and improve the quality, efficiency and value of healthcare ~~delivery.~~delivery across the entire care community. The EPSi^TM operating segment is included in the “Unallocated Amounts” category as it does not meet the requirements to be a reportable segment nor the criteria to be aggregated into the 2 reportable segments. The segment disclosures below for the three months ended March 31, 2019 have been revised to conform to the current year presentation.

Our Chief Operating Decision Maker (“CODM”) uses segment revenues, gross profit and income (loss) from operations as measures of performance and to make decisions about the allocation of resources. In determining these performance measures, we do not include in revenue the amortization of acquisition-related deferred revenue adjustments, which reflect the fair value adjustments to deferred revenue acquired in a business combination. We also exclude the amortization of intangible assets, stock-based compensation expense, expenses not reflective of our core business and transaction-related costs, and non-cash asset impairment charges from the operating segment data provided to our CODM. Expenses not reflective of our core business relate to certain severance, product consolidation, legal, consulting and other charges. Accordingly, these amounts are not included in our reportable segment results and are included in an “Unallocated Amounts” category within our segment disclosure. The “Unallocated Amounts” category also includes (i) corporate general and administrative expenses (including marketing expenses) ~~and certain research and development expenses related to common solutions and resources that benefit all of our business units, all of which are centrally managed,~~ and (ii) revenue and the associated cost from the resale of certain ancillary products, primarily hardware. We do not track our assets by segment.

	Three Months Ended June 30,						Six Months Ended June 30,						Three Months Ended March 31,
(In thousands)	2019			2018			2019			2018			2020			2019
Revenue:
Provider	$	405,690		$	413,467		$	798,297		$	823,891
Veradigm		38,521			33,497			73,637			56,304
Core Clinical and Financial Solutions													$	321,539		$	341,896
Data, Analytics and Care Coordination														82,062			74,259
Unallocated Amounts		249			(5,500	)		4,575			(5,009	)		13,112			15,894
Total revenue	$	444,460		$	441,464		$	876,509		$	875,186		$	416,713		$	432,049

Gross profit:
Provider	$	174,315		$	184,101		$	340,133		$	369,830
Veradigm		27,114			23,313			49,548			38,443
Core Clinical and Financial Solutions													$	102,414		$	119,337
Data, Analytics and Care Coordination														51,889			50,120
Unallocated Amounts		(17,307	)		(33,647	)		(31,464	)		(49,841	)		2,658			4,638
Total gross profit	$	184,122		$	173,767		$	358,217		$	358,432		$	156,961		$	174,095

Income (loss) from operations:
Provider	$	104,125		$	99,801		$	204,399		$	206,941
Veradigm		12,231			8,281			20,550			13,313
Core Clinical and Financial Solutions													$	27,534		$	42,498
Data, Analytics and Care Coordination														19,361			17,696
Unallocated Amounts		(111,613	)		(168,176	)		(217,561	)		(287,049	)		(56,095	)		(57,549	)
Total income (loss) from operations	$	4,743		$	(60,094	)	$	7,388		$	(66,795	)	$	(9,200	)	$	2,645

The majority of the restricted cash balance as of ~~June 30,~~March 31, 2020 and 2019 ~~and 2018~~ represents the remaining balance of the escrow account established as part of the acquisition of Netsmart in 2016, to be used by Netsmart to facilitate the integration of Allscripts’ former Homecare^TMbusiness.

	June 30,				March 31,
(In thousands)	2019		2018		2020		2019
Reconciliation of cash, cash equivalents and restricted cash:
Cash and cash equivalents	$	138,903	$	114,338	$	204,308	$	137,167
Restricted cash		9,236		11,647		7,824		10,681
Total cash, cash equivalents and restricted cash	$	148,139	$	125,985	$	212,132	$	147,848

	Six Months Ended June 30,
(In thousands)	2019		2018
Supplemental non-cash information:
Accretion of redemption preference on redeemable convertible non-controlling interest - discontinued operation	$	0	$	24,297
Contribution of assets in exchange for equity interest	$	0	$	4,000
Issuance of treasury stock to commercial partner	$	701	$	0

On August 6, 2019, Practice Fusion, acquired by Allscripts on February 13, 2018, reached an agreement in principle with the DOJ to resolve the DOJ’s criminal and civil investigations. Refer to Note 13, “Contingencies” for additional information regarding the DOJ’s investigations of Practice Fusion and the pending settlement.

On August 7, 2019, we entered into a First Amendment to the Second Amended Credit Agreement with JPMorgan Chase Bank, N.A., as administrative agent, and certain other lenders. This amendment gives us the financial flexibility to settle the DOJ’s criminal and civil investigations of Practice Fusion while continuing to remain in compliance with the covenants of our Second Amended Credit Agreement. None of the original terms of our Second Amended Credit Agreement relating to scheduled future principal payments, applicable interest rates and margins, or borrowing capacity under our Revolving Facility were amended. In connection with this amendment, we incurred fees and other costs totaling approximately $0.8 million which will be recognized in the third quarter of 2019.

This “Management’s Discussion and Analysis of Financial Condition and Results of Operations” section and other sections of this Quarterly Report on Form 10-Q (“Form 10-Q”) contain forward-looking statements, within the meaning of the Private Securities Litigation Reform Act of 1995, that involve risks and uncertainties. Forward-looking statements provide current expectations of future events based on certain assumptions and include any statement that does not directly relate to any historical fact or pattern, including statements regarding the potential impacts of the COVID-19 pandemic and steps we have taken or plan to take in response thereto, statements related to the effect of macroeconomic trends, statements regarding evolving patient care models, ~~and~~statements regarding legislative, administrative and regulatory actions on our business and opportunities related to accumulated patient data, statements regarding our ~~agreement in principle~~settlement agreements with the DOJ and statements regarding our expected future investment in research and development efforts. Forward-looking statements can also be identified by the use of words such as “future,” “anticipates,” “believes,” “estimates,” “expects,” “intends,” “plans,” “predicts,” “will,” “would,” “could,” “can,” “may,” and similar terms. Forward-looking statements are not guarantees of future performance. Actual results could differ significantly from those set forth in the forward-looking statements and reported results should not be considered an indication of future performance or events. Certain factors that could cause our actual results to differ materially from those described in the forward-looking statements include, but are not limited to, those discussed in Part I, Item 1A of our Annual Report on Form 10-K for the year ended December 31, ~~2018~~2019 (our “Form 10-K”) and Part II, Item 1A of this Form 10-Q under the ~~heading~~headings “Risk Factors” and elsewhere. Certain factors that could cause Allscripts actual results to differ materially from those described in the forward-looking statements include, but are not limited to: the ~~final outcome~~magnitude, severity and duration of the ~~criminal~~COVID-19 pandemic, including the impacts of the pandemic, along with the impacts of our responses and ~~civil investigations~~the responses by governments and other businesses to the ~~DOJ involving~~pandemic, on our business, our employees, our clients and our suppliers; the failure by Practice Fusion ~~including our ability~~ to ~~negotiate final~~comply with the terms of the settlement agreements with the ~~DOJ~~DOJ; the costs and burdens of compliance by Practice Fusion with the terms of ~~such agreements; potential~~its settlement agreements with the DOJ; additional investigations and proceedings from governmental entities or third parties other than the DOJ related to the same or similar conduct underlying the DOJ’s investigations into Practice Fusion’s business practices; the expected financial results of businesses acquired by ~~us, including the EIS business, the NantHealth provider/patient solutions business, Practice Fusion and Health Grid;~~us; the successful integration of businesses recently acquired by us; the anticipated and unanticipated expenses and liabilities related to ~~the EIS business, the NantHealth provider/patient solutions business, Practice Fusion and Health Grid,~~businesses acquired by us, including the civil investigation by the U.S. Attorney’s Office involving our EIS ~~business;~~Business; security breaches resulting in unauthorized access to our or our clients’ computer systems or data, including denial-of-services, ransomware or other Internet-based attacks; ~~Allscripts~~our failure to compete successfully; consolidation in ~~Allscripts~~our industry; current and future laws, regulations and industry initiatives; increased government involvement in ~~Allscripts~~our industry; the failure of markets in which ~~Allscripts operates~~we operate to develop as quickly as expected; ~~Allscripts~~our or ~~its~~our customers’ failure to see the benefits of government programs; changes in interoperability or other regulatory standards; the effects of the realignment of ~~Allscripts~~our sales, services and support organizations; market acceptance of ~~Allscripts~~our products and services; the unpredictability of the sales and implementation cycles for ~~Allscripts~~our products and services; ~~Allscripts~~our ability to manage future growth; ~~Allscripts~~our ability to introduce new products and services; ~~Allscripts~~our ability to establish and maintain strategic relationships; ~~risks related to the acquisition of new businesses or technologies;~~ the performance of ~~Allscripts~~our products; ~~Allscripts~~our ability to protect ~~its~~our intellectual property rights; the outcome of legal proceedings involving ~~Allscripts; Allscripts~~us; our ability to hire, retain and motivate key personnel; performance by ~~Allscripts~~our content and service providers; liability for use of content; price reductions; ~~Allscripts~~our ability to license and integrate third party technologies; ~~Allscripts~~our ability to maintain or expand ~~its~~our business with existing customers; risks related to international operations; changes in tax rates or laws; business disruptions; ~~Allscripts~~our ability to maintain proper and effective internal controls; and asset and long-term investment impairment charges. The following discussion should be read in conjunction with the unaudited consolidated financial statements and notes thereto included in Part I, Item 1, “Financial ~~Statements (unaudited)”~~Statements” in this Form 10-Q, as well as our Form 10-K filed with the Securities and Exchange Commission (the “SEC”). We assume no obligation to revise or update any forward-looking statements for any reason, except as required by law.

Each of the terms “we,” “us,” ~~“our”~~“our,” “Company,” or ~~“Company”~~“Allscripts” as used herein refers collectively to Allscripts Healthcare Solutions, Inc. and/or its wholly-owned subsidiaries and controlled affiliates, unless otherwise stated.

We deliver information technology (“IT”) solutions and services to help healthcare organizations achieve optimal clinical, financial and operational results. We sell our solutions to physicians, hospitals, governments, health systems, health plans, life-sciences companies, retail clinics, retail pharmacies, pharmacy benefit managers, insurance companies, employer wellness clinics, and post-acute organizations, such as home health and hospice agencies. We help our clients improve the quality and efficiency of health care with solutions that include electronic health records (“EHRs”), information connectivity, private cloud hosting, outsourcing, analytics, patient ~~engagement, clinical decision support~~access and population health management.

Our solutions empower healthcare professionals with the data, insights and connectivity to other caregivers they need to succeed in an industry that is rapidly changing from fee-for-service models to fee-for-value advanced payment models. We believe we offer some of the most comprehensive solutions in our industry today. Healthcare organizations can effectively manage patients and patient populations across all care settings using a combination of our physician, hospital, health system, post-acute care and population health management products and services. We believe these solutions will help transform health care as the industry seeks new ways to manage risk, improve quality and reduce costs.

Globally, healthcare providers face an aging population and the challenge of caring for an increasing number of patients with chronic ~~diseases.~~diseases, as well as the urgency of the COVID-19 crisis. At the same time, practitioners worldwide are also under growing pressure to demonstrate the delivery of high-quality care at lower ~~costs.~~ costs and to fully embrace expectations of efficient, patient-centered information exchange. Congressional oversight of EHRs and health information technology has increased in recent years. This increased oversight could impact our clients and our business. The passage of the 21 Century Cures Act in December 2016 assuaged some concerns about interoperability and possible FDA oversight of EHRs, and the ensuing regulations on data blocking and interoperability were just released by the Department of Health and Human Services (“HHS”) in March 2020. Certain of the elements of the new regulation may have a significant effect on our business processes and how our clients must exchange patient information. In particular, Allscripts will need to complete development work to satisfy the revised and new certification criterion just released, and we and our clients will be making adjustments to business practices associated with information exchange and provision of Electronic Health Information.

Population health management, analytics, data connectivity based on open Application Programming Interfaces (“APIs”), and other exchange mechanisms, and patient engagement are strategic imperatives that can help address these challenges. In the United States, for example, such initiatives ~~will be~~are critical tools for success under the framework of the Quality Payment Program (“QPP”), launched by the Centers for Medicare & Medicaid Services (“CMS”) in response to the passage of the Medicare Access and CHIP Reauthorization Act (“MACRA”). As healthcare providers and payers continue to migrate from volume-based to value-based care delivery ~~interoperable~~and also weigh compliance with the newly finalized information blocking and interoperability regulations from the Office of the National Coordinator for Health Information Technology (“ONC”) and CMS, solutions that are connected to the consumer marketplace are the key to market leadership in the new healthcare reality. Additionally, there is a small but growing portion of the market interested in payment models not reliant on insurance, such as the direct primary care model, with doctors and other healthcare professionals interested in the clinical value of the interoperable EHR separate and apart from payment mechanisms established by public or commercial payers or associated reporting requirements.

We believe our solutions are delivering value to our clients by providing them with powerful connectivity, as well as increasingly robust patient engagement and care coordination tools, enabling users to successfully participate in alternative payment models that reward high value care delivery. Population health management is commonly viewed as one of the critical next frontiers in healthcare delivery, and we expect this ~~rapidly emerging and~~ evolving area to be a key driver of our future growth, both domestically and globally.

Recent advances in molecular science and computer technology are creating opportunities for the delivery of personalized medicine solutions. We believe these solutions will transform the coordination and delivery of health care, ultimately improving patient outcomes.

Specific to the United States, the healthcare IT industry in which we operate is in the midst of a period of rapid change, primarily due to new laws and regulations, as well as modifications to industry standards. Various incentives that exist today (including alternative payment models that reward high value care delivery) have been rapidly moving health care toward a time where EHRs are as common as practice management or other financial systems in all provider offices. As a result, we believe that legislation, such as the aforementioned MACRA, as well as other government-driven initiatives (including at the state level), will continue to affect healthcare IT adoption and expansion, including products and solutions like ours. We also believe that we are well-positioned in the market to take advantage of the ongoing opportunity presented by these changes.

Given that CMS ~~has proposed further~~annually proposes new and revised regulations, including payment rules for upcoming years, which require use of EHRs and other health information technology even as we comply with previously published rules, our industry is preparing on an ongoing basis for additional areas in which we must execute compliance. Similarly, our ability to achieve newly expanded applicable product certification requirements resulting from changing strategies at the ~~Office of the National Coordinator for Health Information Technology (“ONC”),~~ONC and the scope of related development and other efforts required to meet regulatory standards could both materially impact our capacity to maximize the market opportunity. All of our market-facing EHR solutions and several other relevant products have successfully completed the testing process and are certified as 2015 Edition-compliant by an ONC-Authorized Certification Body (the most recent ~~Edition). Allscripts remains~~edition), and we remain committed to satisfying ~~evolving~~the new certification requirements and meeting the conditions of certification ~~including those~~ that ~~are expected to be~~were recently finalized atby the ~~end of the review process by ONC this year.~~ONC.

The MACRA encouraged the adoption of health IT necessary to satisfy new requirements more closely associating the report of quality measurements to Medicare payments. Following the finalization of the Physician Fee Schedule rule ~~for the QPP in 2017,~~each year, providers accepting payment from Medicare ~~were given an opportunity to~~must select one of two payment models: ~~The~~the Merit-based Incentive Payment System (“MIPS”) or an Advanced Alternative Payment Model (“APM”). Both of these approaches require substantive reporting on quality measures; additionally, the MIPS consolidated several preexisting incentive programs, including Medicare Meaningful Use and Physician Quality Reporting System, under one umbrella, as required by statute. ~~The~~We believe the implementation of this ~~new~~ law is likely driving additional interest in our products among providers who were not eligible for or chose not to participate in the Health Information Technology for Economic and Clinical Health Act (“HITECH”) incentive program but now need an EHR and other health IT solutions ~~or by~~and among those looking to purchase more robust systems to comply with increasingly complex MACRA requirements. Additional regulations continue to be released annually, clarifying requirements related to reporting and quality measures, which will enable physician populations and healthcare organizations to make strategic decisions about the purchase of analytic software or other solutions important to comply with the new law and associated regulations.

HITECH resulted in additional related new orders for our EHR products, and we believe that the MACRA ~~could~~may drive purchases of not only EHRs but also additional technologies necessary in advanced payment models. Large physician groups will continue to purchase and enhance their use of EHR technology; while the number of very large practices with over 100 physicians that have not yet acquired such technology is insignificant, those considering replacement purchases are increasing. Such practices may choose to replace older EHR technology in the future as regulatory requirements (such as those related to Advanced APMs) and business realities dictate the need for updates and upgrades, as well as additional features and functionality. As incentive payment strategies shift in policies under the current Presidential Administration in the United States, the role of commercial payers and their continued expansion of alternative payment models and interest in attaining larger volumes of clinical data, as well as the anticipated growth in Medicaid payment models, are expected to provide additional incentives for purchase and expansion.

We also continue to see activity in local community-based buying, whereby individual hospitals, health systems and integrated delivery networks subsidize the purchase of EHR licenses or related services for local, affiliated physicians and physicians across their employed physician base in order to leverage buying power and to help those practices take advantage of payment reform opportunities. This activity has also resulted in a pull-through effect where smaller practices affiliated with a community hospital are motivated to participate in a variety of incentive programs, while the subsidizing health system expands connectivity within the local provider community. We believe that the ~~2013 extension of~~new rules related to exceptions to the Stark Law and Anti-Kickback Statute, which ~~allowed~~were recently released in proposed form and would continue to allow hospitals and other organizations to subsidize the purchase of EHRs, ~~contributed~~will possibly further contribute to the growth of this market ~~dynamic, and we await announced~~dynamic. We expect that these regulatory revisions from HHS ~~that are expected to~~will further support value-based payment models and their associated purchasing arrangements between hospitals and physician ~~practices.~~practices, including allowing subsidization of replacement EHRs and not just initial purchases. The associated challenge we face is to successfully position, sell, implement and support our products sold to hospitals, health systems or integrated delivery networks that subsidize their affiliated physicians. We believe the community programs we have in place will help us penetrate these markets.

We believe we have taken and continue to take the proper steps to maximize the opportunity presented by the QPP and other new payment programs, including several announced recently, such as Primary Care First and the Pathways to Success overhaul of Medicare’s National ACO program. However, given the effects the laws are having on our clients, there can be no assurance that they will result in significant new orders for us in the near term, and if they do, that we will have the capacity to meet the additional market demand in a timely fashion.

Additionally, other public laws to reform the United States healthcare system contain various provisions, which may impact us and our clients. Continued efforts by the current Presidential Administration and several state governments to alter aspects of the Patient Protection and Affordable Care Act (as amended, the “PPACA”) or to make other policy changes through Executive Orders create uncertainty for us and for our ~~clients, particularly through~~clients. Certain lawsuits related to the ~~court system.~~PPACA also create uncertainty for us and our clients. Some laws currently in place may have a positive impact by requiring the expanded use of EHRs, quality measurement, prescription drug monitoring and analytics tools to participate in certain federal, state or private sector programs. Others, such as adjustments made to the PPACA by the ~~current Presidential~~ Administration, laws or regulations mandating reductions in reimbursement for certain types of providers, decreasing insurance coverage of patients, ~~state level~~state-level requests for waivers from CMS related to Medicaid modeling, or increasing regulatory oversight of our products or our business practices, may have a negative impact by reducing the resources available to purchase our products. Increases in fraud and abuse enforcement and payment adjustments for non-participation in certain programs or overpayment of certain incentive payments may also adversely affect participants in the healthcare sector, including us.

~~Generally, Congressional oversight~~Allscripts continues to see increased opportunities stemming from the large stores of ~~EHRs~~patient data accumulated from our industry-leading client base and ~~health information~~partnerships with other EHR companies, including NextGen Healthcare Inc., a leading provider of ambulatory-focused healthcare technology ~~increased~~solutions. Through collaboration with researchers and life sciences companies, we believe Allscripts may play a role in ~~recent years, including a specific focus on perceived interoperability failures and physician frustration with user burden,~~the study of real-world evidence as it relates to post-market surveillance of new medicines, as an example. We will closely monitor regulations and/or guidance from the FDA, as well as ~~contributing factors to such dissatisfaction. This increased oversight could impact our clients and our business. The passage~~any new laws that take shape in Congress that may touch third-party uses of ~~the 21~~^st ~~Century Cures Act in December 2016 assuaged some concerns about interoperability and possible FDA oversight of EHRs, and we await the final regulations on~~patient data blocking and interoperability that were released in proposed form by HHS in February 2019. Certain of these proposals may have a significant effect on our business processes and how our clients must exchangeand/or any related privacy implications for patient ~~information. We will respond as necessary to the finalized regulations on those topics, which are expected by year’s end.~~consent.

Congressional focus on addressing the opioid epidemic in part through technological applications and reducing clinician burden is likely to continue. The Administration is also taking action in some areas that may directly or indirectly affect Allscripts and our clients, including efforts to increase health-related price transparency in order to support patients in applying market-based pressures to the nation’s challenge of health cost containment. Further, CMS has ~~proposed~~finalized changes to the Evaluation & Management coding structure that ties closely to our clients’ requirements to document the care they are delivering prior to payment. We expect these changes may have a positive effect on clinician satisfaction with our EHRs, ~~if implemented as proposed,~~ though the fundamentals of payment will remain in transition to value-based payment models.

New payment and delivery system reform programs, including those ~~related to~~modeled after those of the Medicare program, are increasingly being rolled out at the state level through Medicaid administrators, as well as through the private sector, presenting additional opportunities for us to provide software and services to our clients who participate. We also must take steps to comply with state-specific laws and regulations governing companies in the health information technology space.

We derive our revenues primarily from sales of our proprietary software (either as a perpetual license sale or under a subscription delivery model), support and maintenance services, and managed services, such as outsourcing, private cloud hosting and revenue cycle management.

The global outbreak of the novel coronavirus (COVID-19) has severely restricted the level of economic activity around the world. We have been carefully monitoring the COVID-19 pandemic and its impact on our global operations. We are conducting business with certain modifications to employee travel, employee work locations, and cost reduction initiatives, among other modifications. We will continue to actively monitor the situation and may take further actions that alter our business operations as may be required by federal, state or local authorities or that we determine are in the best interests of our employees, customers, partners and stockholders.

The COVID-19 pandemic negatively impacted revenue in the quarter as we saw delays in deals with upfront software revenue and professional services implementations across our inpatient and outpatient base towards the end of the quarter. In April 2020, we implemented cost actions that included headcount reductions and temporary salary measures. We believe our cost reduction actions and liquidity serve to position us appropriately and provide operating and financial flexibility to assist us in navigating through this uncertain environment.

The extent to which the COVID-19 outbreak impacts the Company’s results of operations and financial condition will depend on future developments that are highly uncertain and cannot be predicted, including new information that may emerge concerning the severity of COVID-19, the longevity of COVID-19, the impact of COVID-19 on economic activity, and the actions to contain its impacts on public health and the global economy. See Part II, Item 1A, Risk Factors, for an additional discussion of risks related to COVID-19.

We adopted ~~the new leasing standard~~ Accounting Standards Update No. 2016-13, “Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments” (“ASU ~~2016-02 effective~~2016-13”) on January 1, ~~2019.~~2020 using the cumulative-effect adjustment transition method. The ~~standard~~guidance in ASU 2016-13 replaces the incurred loss impairment methodology under current GAAP. The new impairment model requires ~~that leased~~immediate recognition of estimated credit losses expected to occur for most financial assets and ~~corresponding lease liabilities~~certain other instruments. For available-for-sale debt securities with unrealized losses, the losses will be recognized as allowances rather than reductions in the ~~consolidated balance sheets as right-to-use assets~~amortized cost of the securities. ASU 2016-13 is effective for annual periods beginning after December 15, 2019, and ~~operating or financing lease liabilities.~~interim periods within those annual periods. Refer to Note 2 “Revenue from Contracts with Customers” and Note 3 ~~“Leases”~~“Accounts Receivable” to our consolidated financial statements included in Part I, Item 1, “Financial ~~Statements (unaudited)”~~Statements” of this Form 10-Q for further information regarding the impact of adopting ASU ~~2016-02.~~2016-13.

There were no other material changes to our critical accounting policies and estimates from those previously disclosed in our Form 10-K.

During the ~~second~~first quarter of ~~2019,~~2020, we continued to make progress on our key strategic, financial and operational imperatives, which are aimed at driving higher client satisfaction, improving our competitive position by expanding the depth and breadth of our products and integrating recent acquisitions. Additionally, we believe there are still opportunities to continue to improve our operating leverage and further streamline our operations and such efforts are ongoing.

Total revenue for the ~~second~~first quarter of ~~2019~~2020 was ~~$445~~$417 million, ~~an increase~~a decrease of $4$15 million compared to the ~~second~~first quarter of ~~2018.~~2019. For the three months ended ~~June 30, 2019,~~March 31, 2020, software delivery, support and maintenance revenue and client services revenue was ~~$285~~$264 million and ~~$159~~$153 million, respectively, compared with ~~$284~~$275 million and $157 million, respectively, during the three months ended ~~June 30, 2018.~~March 31, 2019.

Gross profit ~~and~~for the first quarter was $157 million, a decrease of $17 million compared to the first quarter of 2019. Gross margin decreased to 37.7% in the first quarter of 2020 compared to a 40.3% gross margin ~~increased during the three months ended June 30, 2019 compared with the prior year comparable period, primarily due to improved efficiencies and cost structure within client services and an increase~~ in ~~organic sales for Veradigm and our acute solutions in 2019 compared to 2018, which carry higher margins. Gross profit and gross margin increases were partially offset due to higher amortization~~first quarter of ~~software development and acquisition-related assets. Gross profit margin was 41.4% during the three months ended June 30, 2019 compared with 39.4% during the three months ended June 30, 2018.~~2019.

Our contract backlog as of ~~June 30, 2019~~March 31, 2020 was ~~$3.9~~$4.5 billion, which ~~remained consistent~~increased compared with our contract backlog of ~~$3.9~~$4.4 billion and $4.0 billion as of December 31, ~~2018, while decreasing compared with contract backlog as of June 30, 2018 of $4.3 billion.~~2019 and March 31, 2019, respectively.

Our bookings, which reflect the value of executed contracts for software, hardware, other client services, private-cloud hosting, outsourcing and subscription-based services, totaled ~~$276~~$205 million for the three months ended ~~June 30, 2019,~~March 31, 2020, which represents an ~~increase~~decrease of ~~31%~~28% over the comparable prior period amount of ~~$211~~$286 million and a decrease of 3%34% from the ~~first~~fourth quarter of 2019 amount of ~~$286~~$312 million.

Three ~~and Six~~ Months Ended ~~June 30, 2019~~March 31, 2020 Compared with the Three ~~and Six~~ Months Ended ~~June 30, 2018~~March 31, 2019

	Three Months Ended June 30,									Six Months Ended June 30,									Three Months Ended March 31,
(In thousands)	2019			2018			% Change			2019			2018			% Change
(In thousands, except percentages)																			2020			2019			% Change
Revenue:
Software delivery, support and maintenance	$	285,023		$	284,485			0.2	%	$	560,535		$	565,038			(0.8	%)	$	263,612		$	275,512			(4.3	%)
Client services		159,437			156,979			1.6	%		315,974			310,148			1.9	%		153,101			156,537			(2.2	%)
Total revenue		444,460			441,464			0.7	%		876,509			875,186			0.2	%		416,713			432,049			(3.5	%)
Cost of revenue:
Software delivery, support and maintenance		91,351			92,938			(1.7	%)		179,484			178,948			0.3	%		76,325			81,033			(5.8	%)
Client services		139,957			150,174			(6.8	%)		281,556			287,262			(2.0	%)		152,786			148,699			2.7	%
Amortization of software development and acquisition-related assets		29,030			24,585			18.1	%		57,252			50,544			13.3	%		30,641			28,222			8.6	%
Total cost of revenue		260,338			267,697			(2.7	%)		518,292			516,754			0.3	%		259,752			257,954			0.7	%
Gross profit		184,122			173,767			6.0	%		358,217			358,432			(0.1	%)		156,961			174,095			(9.8	%)
Gross margin %		41.4	%		39.4	%					40.9	%		41.0	%					37.7	%		40.3	%
Selling, general and administrative expenses		105,542			122,913			(14.1	%)		205,787			242,850			(15.3	%)		97,288			100,245			(2.9	%)
Research and development		63,414			74,491			(14.9	%)		127,724			139,281			(8.3	%)		62,155			64,310			(3.4	%)
Asset impairment charges		3,691			30,075			(87.7	%)		3,789			30,075			(87.4	%)		0			98			(100.0	%)
Amortization of intangible and acquisition-related assets		6,732			6,382			5.5	%		13,529			13,021			3.9	%		6,718			6,797			(1.2	%)
Income (loss) from operations		4,743			(60,094	)		(107.9	%)		7,388			(66,795	)		(111.1	%)
(Loss) income from operations																				(9,200	)		2,645		NM
Interest expense		(10,424	)		(11,980	)		(13.0	%)		(20,608	)		(23,674	)		(13.0	%)		(12,223	)		(10,184	)		20.0	%
Other loss, net		(144,994	)		(13	)	NM				(144,481	)		(48	)	NM
Gain on sale of businesses, net		0			173,129			(100.0	%)		0			172,258			(100.0	%)
(Impairment) recovery of long-term investments		0			(9,987	)		(100.0	%)		1,045			(15,487	)		(106.7	%)
Equity in net income of unconsolidated investments		218			767			(71.6	%)		154			706			(78.2	%)
(Loss) income from continuing operations before income taxes		(150,457	)		91,822		NM				(156,502	)		66,960		NM
Other income, net																				522			513			1.8	%
Recovery of long-term investments																				0			1,045			(100.0	%)
Equity in net income (loss) of unconsolidated investments																				200			(64	)	NM
Loss from continuing operations before income taxes																				(20,701	)		(6,045	)	NM
Income tax benefit (provision)		527			(7,256	)		(107.3	%)		(1,405	)		(7,555	)		(81.4	%)		347			(1,932	)		(118.0	%)
Effective tax rate		0.4	%		7.9	%					(0.9	%)		11.3	%					1.7	%		(32.0	%)
(Loss) income from continuing operations, net of tax		(149,930	)		84,566		NM				(157,907	)		59,405		NM
Loss from discontinued operations		0			(14,107	)		(100.0	%)		0			(19,123	)		(100.0	%)
Income tax effect on discontinued operations		0			3,813			(100.0	%)		0			5,475			(100.0	%)
Loss from discontinued operations, net of tax		0			(10,294	)		(100.0	%)		0			(13,648	)		(100.0	%)
Net (loss) income		(149,930	)		74,272		NM				(157,907	)		45,757		NM
Net loss attributable to non-controlling interest		0			2,700			(100.0	%)		424			3,490			(87.9	%)
Accretion of redemption preference on redeemable convertible non-controlling interest - discontinued operations		0			(12,148	)		(100.0	%)		0			(24,297	)		(100.0	%)
Net (loss) income attributable to Allscripts Healthcare Solutions, Inc. stockholders	$	(149,930	)	$	64,824		NM			$	(157,483	)	$	24,950		NM
Net loss																				(20,354	)		(7,977	)		155.2	%
Net loss attributable to non-controlling interests																				0			424			(100.0	%)
Net loss attributable to Allscripts Healthcare Solutions, Inc. stockholders																			$	(20,354	)	$	(7,553	)		169.5	%

NM – We define “NM” as not meaningful for increases or decreases greater than 200%.

	Three Months Ended June 30,							Six Months Ended June 30,							Three Months Ended March 31,
(In thousands)	2019		2018		% Change			2019		2018		% Change			2020		2019		% Change
Revenue:
Recurring revenue	$	350,113	$	361,376		(3.1	%)	$	698,749	$	714,036		(2.1	%)	$	341,219	$	348,636		(2.1	%)
Non-recurring revenue		94,347		80,088		17.8	%		177,760		161,150		10.3	%		75,494		83,413		(9.5	%)
Total revenue	$	444,460	$	441,464		0.7	%	$	876,509	$	875,186		0.2	%	$	416,713	$	432,049		(3.5	%)

Three ~~and Six~~ Months Ended ~~June 30, 2019~~March 31, 2020 Compared with the Three ~~and Six~~ Months Ended ~~June 30, 2018~~March 31, 2019

Recurring revenue consists of subscription-based software sales, support and maintenance revenue, recurring transactions revenue and recurring revenue from managed services solutions, such as outsourcing, private cloud hosting and revenue cycle management. Non-recurring revenue consists of perpetual software licenses sales, hardware resale and non-recurring transactions revenue, and project-based client services revenue.

~~The decrease in recurring~~Recurring revenue decreased for the three months ended ~~June 30, 2019~~March 31, 2020 compared to the prior year comparable period primarily related to known attrition within the EIS business. The sale of the OneContent business on April 2, 2018 also contributed to the decline in recurring revenue for the six months ended June 30, 2019. The OneContent business was acquired as part of the EIS business acquisition on October 2, 2017 and it contributed $13 million of recurring revenue during the first quarter of 2018, including $1 million of amortization of acquisition-related deferred revenue adjustments. Non-recurring revenue increased due to ~~higher sales of perpetual software licenses for our acute solutions in 2019 compared to 2018,~~attrition. The decrease was partially offset by an increase in subscription revenue. Non-recurring revenue decreased for the three months ended March 31, 2020 compared to the prior year comparable period due to lower upfront software revenues and project delays that impacted client services ~~revenue related to the timing of~~revenue. The decrease was partially offset by new business from perpetual software ~~activations.~~license sales.

The percentage of recurring and non-recurring revenue of our total revenue was ~~79% and 21%, respectively, during the three months ended June 30, 2019 and~~ 82% and 18%, respectively, during the three months ended ~~June 30, 2018. The percentage of recurring non-recurring revenue of our total revenue was 80%~~March 31, 2020 and ~~20%~~81% and 19%, respectively, during the ~~six~~three months ended ~~June 30, 2019 and 82% and 18% during the six months ended June 30, 2018.~~March 31, 2019.

	Three Months Ended June 30,									Six Months Ended June 30,									Three Months Ended March 31,
(In thousands)	2019			2018			% Change			2019			2018			% Change
(In thousands, except percentages)																			2020			2019			% Change
Total cost of revenue	$	260,338		$	267,697			(2.7	%)	$	518,292		$	516,754			0.3	%	$	259,752		$	257,954			0.7	%
Gross profit	$	184,122		$	173,767			6.0	%	$	358,217		$	358,432			(0.1	%)	$	156,961		$	174,095			(9.8	%)
Gross margin %		41.4	%		39.4	%					40.9	%		41.0	%					37.7	%		40.3	%

Three ~~and Six~~ Months Ended ~~June 30, 2019~~March 31, 2020 Compared with the Three ~~and Six~~ Months Ended ~~June 30, 2018~~March 31, 2019

Gross profit and gross margin ~~increased~~decreased during the three months ended ~~June 30, 2019~~March 31, 2020 compared with the prior year comparable period, primarily due to ~~improved efficiencies~~attrition, revenue profile and ~~cost structure within client services and an increase in organic sales for Veradigm and our acute solutions in 2019 compared~~unproductive labor costs due to ~~2018, which carry higher margins. These increases were~~project delays. The decrease was partially offset ~~due to higher amortization of~~by new business in software ~~development~~subscription revenues and ~~acquisition-related assets. Gross profit was flat for the six months ended June 30, 2019 due the previously mentioned items and the sale of the OneContent business on April 2, 2019, which had~~ a ~~higher gross margin compared with our other businesses.~~reduction in headcount costs.

	Three Months Ended June 30,							Six Months Ended June 30,							Three Months Ended March 31,
(In thousands)	2019		2018		% Change			2019		2018		% Change			2020		2019		% Change
Selling, general and administrative expenses	$	105,542	$	122,913		(14.1	%)	$	205,787	$	242,850		(15.3	%)	$	97,288	$	100,245		(2.9	%)

Three ~~and Six~~ Months Ended ~~June 30, 2019~~March 31, 2020 Compared with the Three ~~and Six~~ Months Ended ~~June 30, 2018~~March 31, 2019

Selling, general and administrative expenses decreased during the three ~~and six~~ months ended ~~June 30, 2019,~~March 31, 2020, compared with the prior year comparable ~~periods,~~period. The decrease is primarily due to the ~~impact of headcount reduction actions taken~~DOJ-related legal expenses that were incurred during ~~2018 as part of~~ the integration of the EIS, Practice Fusion and Health Grid acquisitions, the sale of OneContent, which resulted in one-time incentive compensation expenses and lower transaction-related and legal expenses.three months ended March 31, 2019.

	Three Months Ended June 30,							Six Months Ended June 30,							Three Months Ended March 31,
(In thousands)	2019		2018		% Change			2019		2018		% Change			2020		2019		% Change
Research and development	$	63,414	$	74,491		(14.9	%)	$	127,724	$	139,281		(8.3	%)	$	62,155	$	64,310		(3.4	%)

Three ~~and Six~~ Months Ended ~~June 30, 2019~~March 31, 2020 Compared with the Three ~~and Six~~ Months Ended ~~June 30, 2018~~March 31, 2019

Research and development expenses decreased during the three ~~and six~~ months ended ~~June 30, 2019,~~March 31, 2020 compared with the prior year comparable ~~periods. This decrease was~~period, primarily due to the ~~sale~~impact of ~~OneContent at the beginning of second quarter 2018 as there were $10 million of one-time incentive compensation expenses recorded~~strategic efficiency initiatives that began in ~~research and development as a result of the sale.~~2019.

	Three Months Ended June 30,							Six Months Ended June 30,							Three Months Ended March 31,
(In thousands)	2019		2018		% Change			2019		2018		% Change			2020		2019		% Change
Asset impairment charges	$	3,691	$	30,075		(87.7	%)	$	3,789	$	30,075		(87.4	%)	$	0	$	98		(100.0	%)

Three ~~and Six~~ Months Ended ~~June 30, 2019~~March 31, 2020 Compared with the Three ~~and Six~~ Months Ended ~~June 30, 2018~~March 31, 2019

Asset impairment charges for the three months ~~and six months~~ ended ~~June 30,~~March 31, 2019 were ~~primarily~~ the result of ~~retiring certain hosting assets due to data center migrations. During the three and six months ended June 30, 2018, we recognized non-cash~~miscellaneous fixed asset ~~impairment charges related to the write-off of purchased third-party software as a result of our decision to discontinue several software development projects.~~write-offs.

	Three Months Ended June 30,							Six Months Ended June 30,							Three Months Ended March 31,
(In thousands)	2019		2018		% Change			2019		2018		% Change			2020		2019		% Change
Amortization of intangible and acquisition-related assets	$	6,732	$	6,382		5.5	%	$	13,529	$	13,021		3.9	%
Amortization of intangible and acquisition-related Assets															$	6,718	$	6,797		(1.2	%)

Three ~~and Six~~ Months Ended ~~June 30, 2019~~March 31, 2020 Compared with the Three ~~and Six~~ Months Ended ~~June 30, 2018~~March 31, 2019

The ~~increase~~decrease in amortization expense for the three ~~and six~~ months ended ~~June 30, 2019,~~March 31, 2020, compared with the prior year comparable ~~periods,~~period, was due to ~~incremental~~normal amortization expense ~~associated with~~and certain intangible assets ~~acquired as part of business combinations completed during 2018.~~being fully amortized in 2019.

	Three Months Ended June 30,							Six Months Ended June 30,							Three Months Ended March 31,
(In thousands)	2019		2018		% Change			2019		2018		% Change			2020		2019		% Change
Interest expense	$	10,424	$	11,980		(13.0	%)	$	20,608	$	23,674		(13.0	%)	$	12,223	$	10,184		20.0	%

Three ~~and Six~~ Months Ended ~~June 30, 2019~~March 31, 2020 Compared with the Three ~~and Six~~ Months Ended ~~June 30, 2018~~March 31, 2019

Interest expense increased during the three ~~and six~~ months ended ~~June 30, 2019 decreased~~March 31, 2020 compared to the prior year comparable ~~periods,~~period due to higher borrowings and a full quarter accrual of interest on the ~~impact of lower average outstanding borrowings partially offset by higher interest rates.~~0.875% convertible senior notes.

	Three Months Ended June 30,							Six Months Ended June 30,							Three Months Ended March 31,
(In thousands)	2019			2018			% Change	2019			2018			% Change	2020		2019		% Change
Other loss, net	$	(144,994	)	$	(13	)	NM	$	(144,481	)	$	(48	)	NM
Other income, net															$	522	$	513		1.8	%

Three ~~and Six~~ Months Ended ~~June 30, 2019~~March 31, 2020 Compared with the Three ~~and Six~~ Months Ended ~~June 30, 2018~~March 31, 2019

Other ~~loss,~~income, net for the three ~~and six~~ months ended ~~June 30,~~March 31, 2020 and 2019 ~~and 2018~~ consisted of a combination of interest income, and miscellaneous receipts and expenses. ~~The large increase in 2019 was due to the expected $145 million settlement with the DOJ related to its civil and criminal investigations~~

Recovery of ~~Practice Fusion. Refer to Note 13, “Contingencies” of the Notes to the Consolidated Financial Statements in Part I, Item 1 of this Form 10-Q for further information regarding the investigations.~~

	Three Months Ended June 30,							Six Months Ended June 30,							Three Months Ended March 31,
(In thousands)	2019		2018		% Change			2019		2018		% Change			2020		2019		% Change
Gain on sale of businesses, net	$	0	$	173,129		(100.0	%)	$	0	$	172,258		(100.0	%)
Recovery of long-term investments															$	0	$	1,045		(100.0	%)

Three ~~and Six~~ Months Ended ~~June 30, 2019~~March 31, 2020 Compared with the Three ~~and Six~~ Months Ended ~~June 30, 2018~~

Gain on sale of businesses, net during the three and six months ended June 30, 2018 consists of a gain of $177.9 million and a loss of $5.6 million from the divestiture of our OneContent and Strategic Sourcing businesses, respectively.

~~Three and Six Months Ended June 30,~~March 31, 2019 ~~Compared with the Three and Six Months Ended June 30, 2018~~

During the ~~six~~three months ended ~~June 30,~~March 31, 2019, we recovered $1.0 million from a third-party cost-method investment that we had previously impaired. The impairment charges for the three and six months ended June 30, 2018 were the result of non-cash charges related to two of our cost-method equity investments and a related note receivable. These charges equaled the cost bases of the investments and the related note receivable prior to the impairment.

	Three Months Ended June 30,							Six Months Ended June 30,							Three Months Ended March 31,
(In thousands)	2019		2018		% Change			2019		2018		% Change			2020		2019			% Change
Equity in net income of unconsolidated investments	$	218	$	767		(71.6	%)	$	154	$	706		(78.2	%)
Equity in net income (loss) of unconsolidated investments															$	200	$	(64	)	NM

Three ~~and Six~~ Months Ended ~~June 30, 2019~~March 31, 2020 Compared with the Three ~~and Six~~ Months Ended ~~June 30, 2018~~March 31, 2019

Equity in net ~~loss~~income (loss) of unconsolidated investments represents our share of the equity earnings (losses) of our investments in third parties accounted for under the equity method of ~~accounting.~~accounting based on one quarter lag.

	Three Months Ended June 30,									Six Months Ended June 30,									Three Months Ended March 31,
(In thousands)	2019			2018			% Change			2019			2018			% Change
(In thousands, except percentages)																			2020			2019			% Change
Income tax benefit (provision)	$	527		$	(7,256	)		(107.3	%)	$	(1,405	)	$	(7,555	)		(81.4	%)	$	347		$	(1,932	)		(118.0	%)
Effective tax rate		0.4	%		7.9	%					(0.9	%)		11.3	%					1.7	%		(32.0	%)

Three ~~and Six~~ Months Ended ~~June 30, 2019~~March 31, 2020 Compared with the Three ~~and Six~~ Months Ended ~~June 30, 2018~~March 31, 2019

~~The United States Tax Cuts and Jobs Act (the “Tax Act”) was enacted on December 22, 2017 and introduced significant changes to the income tax law in the United States.~~ Our provision for income taxes differs from the tax computed at the U.S. federal statutory income tax rate due primarily ~~due~~ to permanent differences, income attributable to foreign jurisdictions taxed at different rates, state taxes, tax credits and certain discrete items. Our effective tax rate for the three ~~and six~~ months ended ~~June 30, 2019,~~March 31, 2020, compared with the prior year comparable ~~periods,~~period, differs primarily due to ~~higher tax shortfalls associated with stock-based compensation reflected in~~ the ~~provision~~fact that the permanent items, credits and the impact of foreign earnings had less impact on the pre-tax loss of $20.7 million for the ~~six~~three months ended ~~June 30, 2019 and release~~March 31, 2020, compared to the impacts of ~~valuation allowance~~these items on a pre-tax loss of ~~$18~~$6.0 million ~~recorded in~~for the ~~six~~three months ended ~~June 30, 2018.~~March 31, 2019.

Three ~~and Six~~ Months Ended ~~June 30, 2019~~March 31, 2020 Compared with the Three ~~and Six~~ Months Ended ~~June 30, 2018~~

On December 31, 2018, we sold all of the Class A Common Units of Netsmart owned by the Company. Prior to the sale, Netsmart comprised a separate reportable segment due to its significance to our historical consolidated financial statements and results of operations, and is now reported as a discontinued operation as a result of the sale for all periods presented. The loss from discontinued operations primarily represents the net losses incurred by Netsmart for the three and six months ended June 30, 2018. Also included in discontinued operations are earnings associated with the Horizon Clinicals and Series2000 Revenue Cycle product offerings, which we stopped supporting effective as of March 31, ~~2018. Refer to Note 14, “Discontinued Operations” of the Notes to Consolidated Financial Statements in Part I, Item 1 of this Form 10-Q for further information regarding discontinued operations.~~

~~Three and Six Months Ended June 30,~~ 2019 ~~Compared with the Three and Six Months Ended June 30, 2018~~

The net loss attributable to non-controlling interest represents the share of earnings of consolidated affiliates that is attributable to the affiliates’ common stock that is not owned by us for each of the periods presented. ~~The accretion of redemption preference on redeemable convertible non-controlling interest represents the accretion of liquidation preference at 11% per annum to the value~~We purchased all of the ~~preferred units of Netsmart, prior to the sale of our investment~~outstanding minority interests in ~~Netsmart on December 31, 2018.~~

~~During~~Pulse8, Inc. during the first quarter of ~~2019, we changed our reportable segments from Clinical and Financial Solutions, Population Health and Unallocated to Provider, Veradigm and Unallocated.~~ 2019.

The segment disclosures below for the three ~~and six~~ months ended ~~June 30, 2018,~~March 31, 2019 have been revised to conform to the current year presentation. Refer to Note 15 “Business Segments” of the Notes to Consolidated Financial Statements in Part I, Item 1 of this Form 10-Q for further discussion on the impact of the change.

	Three Months Ended June 30,									Six Months Ended June 30,									Three Months Ended March 31,
(In thousands)	2019			2018			% Change			2019			2018			% Change			2020			2019			% Change
Revenue:
Provider	$	405,690		$	413,467			(1.9	%)	$	798,297		$	823,891			(3.1	%)
Veradigm		38,521			33,497			15.0	%		73,637			56,304			30.8	%
Core Clinical and Financial Solutions																			$	321,539		$	341,896			(6.0	%)
Data, Analytics and Care Coordination																				82,062			74,259			10.5	%
Unallocated Amounts		249			(5,500	)		104.5	%		4,575			(5,009	)		191.3	%		13,112			15,894			17.5	%
Total revenue	$	444,460		$	441,464			0.7	%	$	876,509		$	875,186			0.2	%	$	416,713		$	432,049			(3.5	%)

Gross Profit:
Provider	$	174,315		$	184,101			(5.3	%)	$	340,133		$	369,830			(8.0	%)
Veradigm		27,114			23,313			16.3	%		49,548			38,443			28.9	%
Care Coordination and Financial Solutions																			$	102,414		$	119,337			(14.2	%)
Data, Analytics and Care Coordination																				51,889			50,120			3.5	%
Unallocated Amounts		(17,307	)		(33,647	)		48.6	%		(31,464	)		(49,841	)		36.9	%		2,658			4,638			42.7	%
Total gross profit	$	184,122		$	173,767			6.0	%	$	358,217		$	358,432			(0.1	%)	$	156,961		$	174,095			(9.8	%)

Income (loss) from operations:
Provider	$	104,125		$	99,801			4.3	%	$	204,399		$	206,941			(1.2	%)
Veradigm		12,231			8,281			47.7	%		20,550			13,313			54.4	%
Care Coordination and Financial Solutions																			$	27,534		$	42,498			(35.2	%)
Data, Analytics and Care Coordination																				19,361			17,696			9.4	%
Unallocated Amounts		(111,613	)		(168,176	)		33.6	%		(217,561	)		(287,049	)		24.2	%		(56,095	)		(57,549	)		2.5	%
Total income (loss) from operations	$	4,743		$	(60,094	)		107.9	%	$	7,388		$	(66,795	)		111.1	%
Total (loss) income from operations																			$	(9,200	)	$	2,645		NM

Our ~~Provider~~Core Clinical and Financial Solutions segment derives its revenue from the sale of integrated clinical software applications and financial management ~~and patient engagement~~ solutions, which primarily include EHR-related software, ~~connectivity and coordinated care solutions,~~ financial and practice management software, related installation, support and maintenance, outsourcing, private cloud hosting and revenue cycle ~~management, training and electronic claims administration services.~~management.

	Three Months Ended June 30,									Six Months Ended June 30,									Three Months Ended March 31,
(In thousands)	2019			2018			% Change			2019			2018			% Change
(In thousands, except percentages)																			2020			2019			% Change
Revenue	$	405,690		$	413,467			(1.9	%)	$	798,297		$	823,891			(3.1	%)	$	321,539		$	341,896			(6.0	%)
Gross profit	$	174,315		$	184,101			(5.3	%)	$	340,133		$	369,830			(8.0	%)	$	102,414		$	119,337			(14.2	%)
Gross margin %		43.0	%		44.5	%					42.6	%		44.9	%					31.9	%		34.9	%
Income from operations	$	104,125		$	99,801			4.3	%	$	204,399		$	206,941			(1.2	%)	$	27,534		$	42,498			(35.2	%)
Operating margin %		25.7	%		24.1	%					25.6	%		25.1	%					8.6	%		12.4	%

Three ~~and Six~~ Months Ended ~~June 30, 2019~~March 31, 2020 Compared with the Three ~~and Six~~ Months Ended ~~June 30, 2018~~March 31, 2019

~~Provider~~Core Clinical and Financial Solutions revenue decreased during the three ~~and six~~ months ended ~~June 30, 2019,~~March 31, 2020, compared with the prior year comparable ~~periods.~~period primarily due to lower upfront software revenues, attrition and project delays that impacted client services revenue. The decrease ~~in revenue~~ was primarily driven by known attrition within the EIS business and due the sale of the OneContent and Strategic Sourcing businesses on March 15, 2018 and on April 2, 2018, respectively. These businesses were acquired as part of the EIS business acquisition on October 2, 2017 and contributed $16 million of revenue during the first quarter of 2018, including $1 million of amortization of acquisition-related deferred revenue adjustments. These decreases were partlypartially offset by ~~higher sales of perpetual software licenses for our acute solutions~~an increase in ~~2019 compared to 2018 and additional revenue from the acquisition of Health Grid during 2018.~~managed services revenue.

Gross profit and margin decreased during the three ~~and six~~ months ended ~~June 30, 2019,~~March 31, 2020 compared with the prior year comparable ~~periods,~~period, primarily due the previously mentioned attrition, revenue profile and unproductive labor costs due to ~~product mix, primarily driven~~project delays. The decrease was partially offset by ~~the sale of OneContent, which had higher overall profitability, compared with our other Provider businesses. The increase~~a reduction in ~~the operating~~headcount costs.

Operating margin decreased for the three ~~and six~~ months ended ~~June 30, 2019,~~March 31, 2020, compared with the prior year comparable ~~periods,~~period due to a decline in gross profit. The decrease was ~~the result of~~partially offset by lower ~~selling, general and administrative, and~~ research and development expenses driven by headcount reduction actions taken during ~~2018 as part of the integration of the EIS~~2019.

Our ~~Veradigm~~Data, Analytics and Care Coordination segment derives its revenue from the ~~provision~~sale of ~~data-driven clinical insights with actionable tools for clinical workflow, research, analytics~~patient engagement, care coordination, and ~~media. Its~~payer and life sciences solutions, which are mainly targeted at hospitals, health systems, other care facilities, payers, life sciences companies and other key healthcare ~~stakeholders, help improve~~stakeholders. These solutions enable clients to transition, analyze and coordinate care while improving the quality, efficiency and value of healthcare delivery ~~– from biopharma to health plans, healthcare providers and patients, and health technology partners, among others.~~across the entire care community.

	Three Months Ended June 30,									Six Months Ended June 30,									Three Months Ended March 31,
(In thousands)	2019			2018			% Change			2019			2018			% Change
(In thousands, except percentages)																			2020			2019			% Change
Revenue	$	38,521		$	33,497			15.0	%	$	73,637		$	56,304			30.8	%	$	82,062		$	74,259			10.5	%
Gross profit	$	27,114		$	23,313			16.3	%	$	49,548		$	38,443			28.9	%	$	51,889		$	50,120			3.5	%
Gross margin %		70.4	%		69.6	%					67.3	%		68.3	%					63.2	%		67.5	%
Income from operations	$	12,231		$	8,281			47.7	%	$	20,550		$	13,313			54.4	%	$	19,361		$	17,696			9.4	%
Operating margin %		31.8	%		24.7	%					27.9	%		23.6	%					23.6	%		23.8	%

Three ~~and Six~~ Months Ended ~~June 30, 2019~~March 31, 2020 Compared with the Three ~~and Six~~ Months Ended ~~June 30, 2018~~March 31, 2019

~~Veradigm~~Data, Analytics and Care Coordination revenue ~~gross profit and income from operations~~ increased during the three and six months ended June 30, 2019 compared with the prior year comparable periods, primarily driven by an increase in organic sales. The acquisition of Practice Fusion during the first quarter of 2018 contributed to the increase for ~~the six months ended June 30, 2019.~~

~~Gross margin and operating margin increased during~~ the three months ended ~~June 30, 2019,~~March 31, 2020 compared with the prior year comparable period due to ~~an increase~~increases in ~~organic~~perpetual software license sales and ~~cost reductions partially offset~~subscription revenue.

Gross margin decreased during the three months ended March 31, 2020 compared with the prior year comparable period, primarily due to headcount ~~growth. Gross~~growth and higher costs incurred to support the growth of this segment.

Operating margin slightly decreased during the ~~six~~three months ended ~~June 30, 2019~~March 31, 2020 compared with the prior year comparable period due to ~~increased costs associated with~~a decline in gross margin. The decrease was partially offset by lower selling, general and administrative expenses driven by the ~~increase in organic sales. Operating margin increased~~DOJ-related legal expenses incurred during the ~~six~~three months ended June 30, 2019 primarily due to an increase in organic sales and cost reductions partially offset with headcount growth. The acquisition of Practice Fusion during the first quarter of 2018 contributed to the increase for the six months ended June 30,March 31, 2019.

In determining revenue, gross profit and income from operations for our segments, we do not include in revenue the amortization of acquisition-related deferred revenue adjustments, which reflect the fair value adjustments to deferred revenues acquired in a business acquisition. We also exclude the amortization of intangible assets, stock-based compensation expense, expenses not reflective of our core business and transaction-related costs and non-cash asset impairment charges from theThe EPSi^TM operating segment data provided to our CODM. Expenses not reflective of our core business relate to certain severance, product consolidation, legal, consulting and other charges. Accordingly, these amounts are not included in our reportable segment results and areis included in the “Unallocated Amounts” ~~category.~~category as it does not meet the requirements to be a reportable segment nor the criteria to be aggregated into the two reportable segments. The “Unallocated Amounts” category also includes (i) corporate general and administrative expenses (including marketing expenses) ~~and certain research and development expenses related to common solutions and resources that benefit all of our business units, all of which are centrally managed,~~ and (ii) revenue and the associated cost from the resale of certain ancillary products, primarily hardware.

	Three Months Ended June 30,									Six Months Ended June 30,									Three Months Ended March 31,
(In thousands)	2019			2018			% Change			2019			2018			% Change
(In thousands, except percentages)																			2020			2019			% Change
Revenue	$	249		$	(5,500	)		(104.5	%)	$	4,575		$	(5,009	)		(191.3	%)	$	13,112		$	15,894			(17.5	%)
Gross profit	$	(17,307	)	$	(33,647	)		(48.6	%)	$	(31,464	)	$	(49,841	)		(36.9	%)	$	2,658		$	4,638			(42.7	%)
Gross margin %	NM			NM						NM			NM							20.3	%		29.2	%
Loss from operations	$	(111,613	)	$	(168,176	)		(33.6	%)	$	(217,561	)	$	(287,049	)		(24.2	%)	$	(56,095	)	$	(57,549	)		2.5	%
Operating margin %	NM			NM						NM			NM						NM			NM

Three ~~and Six~~ Months Ended ~~June 30, 2019~~March 31, 2020 Compared with the Three ~~and Six~~ Months Ended ~~June 30, 2018~~March 31, 2019

Revenue from the resale of ancillary products, primarily consisting of hardware, is customer and project driven and, as a result, can fluctuate from period to period. Revenue ~~for~~decreased during the three months ended ~~June 30, 2019 increased~~March 31, 2020 compared with the prior year comparable period, primarily due to ~~an increase~~a decrease in hardware ~~revenue in other products as well as only $0.5 million in amortization of acquisition-related deferred revenue adjustments that was recorded~~revenue.

Gross profit and margin decreased during the three months ended June 30, 2019 compared to $9.4 million during the three months ended June 30, 2018. The acquisition-related adjustments in 2018 primarily resulted from the acquisitions of the EIS, Practice Fusion and Nant Health. Revenue for the six months ended June 30, 2019 increasedMarch 31, 2020 compared with the prior year comparable period, primarily due to an increase in hardware revenue in other products as well as only $1.1 million in amortization of acquisition-related deferred revenue adjustments that was recorded during the six months ended June 30, 2019 compared to $13.8 million during the six months ended June 30, 2018.headcount growth.

~~Gross unallocated expenses, which represent the unallocated loss~~Loss from operations ~~excluding the impact of revenue, totaled $112 million for~~decreased during the three months ended ~~June 30, 2019~~March 31, 2020 compared with ~~$163 million for~~ the prior year comparable ~~period. The decrease for the three months ended June 30, 2019 compared with the comparable prior year~~ period, was primarily driven by (i) lower asset impairment charges of $26 million, (ii) lower transaction-related, severance and legal expenses of $34 million, and (iii) offset with an increase in stock-based compensation of $2 million. Gross unallocated expenses totaled $222 million for the six months ended June 30, 2019 compared with $282 million for the six months ended June 30, 2018. The decrease was primarily due to ~~(i) lower asset impairment charges of $26 million, (ii) lower transaction-related, severance~~a decrease in marketing expenses related to our annual Healthcare Information and ~~legal expenses of $46 million, and (iii) offset with an increase in stock-based compensation of $4 million.~~Management Systems Society (“HIMSS”) conference.

Contract backlog represents the value of bookings and support and maintenance contracts that have not yet been recognized as revenue. A summary of contract backlog by revenue category is as follows:

							% Change vs. June 30, 2019												% Change vs. March 31, 2020
(In millions)	As of June 30, 2019		As of December 31, 2018		As of June 30, 2018		December 31, 2018			June 30, 2018			As of March 31, 2020		As of December 31, 2019		As of March 31, 2019		December 31, 2019			March 31, 2019
Software delivery, support and maintenance	$	2,527	$	2,507	$	2,631		0.8	%		(4.0	%)	$	2,561	$	2,519	$	2,717		1.7	%		(5.7	%)
Client services		1,358		1,350		1,689		0.6	%		(19.6	%)		1,946		1,848		1,324		5.3	%		47.0	%
Total contract backlog	$	3,885	$	3,857	$	4,320		0.7	%		(10.1	%)	$	4,507	$	4,367	$	4,041		3.2	%		11.5	%

Total contract backlog as of ~~June 30, 2019 slightly~~March 31, 2020 increased compared with December 31, ~~2018~~2019 and ~~decreased compared with June 30, 2018.~~March 31, 2019. Total contract backlog can fluctuate between periods based on the level of revenue and bookings, as well as the timing and mix of renewal activity and periodic revalidations.

The primary factors that influence our liquidity include, but are not limited to, the amount and timing of our revenues, cash collections from our clients, capital expenditures and investments in research and development efforts, including investments in or acquisitions of ~~third-parties. As~~third parties. Our liquidity was influenced by the COVID-19 pandemic during the three months ended March 31, 2020. We increased cash on hand through additional credit facility borrowings to provide financial flexibility and enhance our ability to address potential future uncertainties regarding the impact of ~~June 30, 2019, our~~the COVID-19 pandemic. Our principal sources of liquidity consisted of cash and cash equivalents of ~~$148~~$212 million and available borrowing capacity of ~~$719~~$684 million under our revolving credit ~~facility.~~facility as of March 31, 2020. The change in our cash and cash equivalents balance is reflective of the following:

Six Months Ended June 30,

(In thousands)

2019

2018

$ Change

Net (loss) income

$
(157,907
)

$
45,757

$
(203,664
)
Less: Loss from discontinued operations

0

(13,648
)

13,648

    (Loss) income from continuing operations

(157,907
)

59,405

(217,312
)
Non-cash adjustments to net income (loss)

136,476

(6,285
)

142,761

Cash impact of changes in operating assets and liabilities

49,521

8,426

41,095

    Net cash provided by operating activities -
        continuing operations

28,090

61,546

(33,456
)
    Net cash (used in) provided by operating activities -
        discontinued operations

(30,000
)

4,994

(34,994
)
    Net cash provided by operating activities

$
(1,910
)

$
66,540

$
(68,450
)

	Three Months Ended March 31,
(In thousands)	2020			2019			$ Change
Net loss	$	(20,354	)	$	(7,977	)	$	(12,377	)
Non-cash adjustments to net loss		65,804			66,399			(595	)
Cash impact of changes in operating assets and liabilities		(49,158	)		(22,606	)		(26,552	)
Net cash (used in) provided by operating activities - continuing operations		(3,708	)		35,816			(39,524	)
Net cash (used in) provided by operating activities - discontinued operations		0			(30,000	)		30,000
Net cash (used in) provided by operating activities	$	(3,708	)	$	5,816		$	(9,524	)

~~Six~~Three Months Ended ~~June 30, 2019~~March 31, 2020 Compared with the ~~Six~~Three Months Ended ~~June 30, 2018~~March 31, 2019

~~Net~~During the three months ended March 31, 2020 we had net use of cash from operating activities – continuing operations compared to net cash provided by operating activities ~~decreased~~ – continuing operations during the ~~six~~three months ended ~~June 30, 2019~~March 31, 2019. Non-cash adjustments to net loss increased during the three months ended March 31, 2020 compared ~~with~~to the prior year comparable period, primarily due to working capital changes and higher incentive compensation payments. Non-cash adjustments to net (loss) income increased during the six months ended June 30, 2019 compared with prior year comparable period. Thisan increase ~~was primarily due to the gain on sale of OneContent occurring~~ in ~~2018 combined with higher~~ depreciation and amortization expenses ~~which were primarily due to amortization of right-of-use assets. These increases were partially offset by a~~and no recovery of a previously impaired investment ~~and lower impairment charges~~in the current period. The increase was partially offset by a decrease in stock-based compensation expenses during the ~~six~~three months ended ~~June 30, 2019 as compared to the prior year comparable period. Net (loss) income and Cash~~March 31, 2020. The impact of changes in operating assets and liabilities ~~reflects~~is primarily due to working capital changes, the ~~$145~~timing of incentive compensation payments and the $57.3 million ~~settlement with~~payment related to the ~~DOJ’s investigations.~~DOJ Settlement Agreements.

Net cash used in operating activities – discontinued operations during the ~~six~~three months ended ~~June 30,~~March 31, 2019 reflects an advance income tax payment related to the gain realized upon the sale of our investment in Netsmart on December 31, 2018.

	Six Months Ended June 30,									Three Months Ended March 31,
(In thousands)	2019			2018			$ Change			2020			2019			$ Change
Capital expenditures	$	(9,429	)	$	(14,022	)	$	4,593		$	(2,845	)	$	(4,847	)	$	2,002
Capitalized software		(55,222	)		(57,339	)		2,117			(28,556	)		(28,600	)		44
Cash paid for business acquisitions, net of cash acquired		(11,718	)		(177,233	)		165,515
Cash received from sale of businesses, net		0			246,801			(246,801	)
Purchases of equity securities, other investments and related intangible assets, net		(1,159	)		(2,723	)		1,564
(Purchases) sales of equity securities, other investments and related intangible assets, net											(3,028	)		32			(3,060	)
Other proceeds from investing activities		9			46			(37	)		0			5			(5	)
Net cash used in investing activities - continuing operations		(77,519	)		(4,470	)		(73,049	)
Net cash used in investing activities - discontinued operations		0			(16,048	)		16,048
Net cash used in investing activities	$	(77,519	)	$	(20,518	)	$	(57,001	)	$	(34,429	)	$	(33,410	)	$	(1,019	)

~~Six~~Three Months Ended ~~June 30, 2019~~March 31, 2020 Compared with the ~~Six~~Three Months Ended ~~June 30, 2018~~March 31, 2019

Net cash used in investing activities slightly increased during the ~~six~~three months ended ~~June 30, 2019,~~March 31, 2020, compared with the prior year comparable period. The increase in the use of cash during ~~2019~~2020 was primarily due to ~~the absence~~our purchase of ~~sales of businesses. The sale of OneContent produced significant investing cash inflows during the six months ended June 30, 2018, which was~~additional investments, partially offset ~~with cash paid for~~ ~~the acquisitions of Practice Fusion and Health Grid.~~by lower capital spending.

	Six Months Ended June 30,									Three Months Ended March 31,
(In thousands)	2019			2018			$ Change			2020			2019			$ Change
Proceeds from sale or issuance of common stock	$	0		$	212		$	(212	)
Taxes paid related to net share settlement of equity awards		(6,695	)		(8,610	)		1,915		$	(3,174	)	$	(5,327	)	$	2,153
Payments on debt instruments and lease obligations		(10,068	)		(215,255	)		205,187
Payments for issuance costs on 0.875% Convertible Senior Notes											(758	)		0			(758	)
Credit facility payments											(80,000	)		(5,000	)		(75,000	)
Credit facility borrowings, net of issuance costs		180,000			275,843			(95,843	)		210,000			120,000			90,000
Repurchase of common stock		(65,070	)		(101,905	)		36,835			(9,714	)		(65,070	)		55,356
Payment of acquisition and other financing obligations		(1,473	)		(3,226	)		1,753			(2,911	)		(55	)		(2,856	)
Purchases of subsidiary shares owned by non-controlling interest		(54,064	)		(6,945	)		(47,119	)		0			(54,064	)		54,064
Net cash provided by (used in) financing activities - continuing operations		42,630			(59,886	)		102,516
Net cash used in financing activities - discontinued operations		0			(7,567	)		7,567
Net cash provided by (used in) financing activities	$	42,630		$	(67,453	)	$	110,083
Net cash provided (used in) by financing activities										$	113,443		$	(9,516	)	$	122,959

~~Six~~Three Months Ended ~~June 30, 2019~~March 31, 2020 Compared with the ~~Six~~Three Months Ended ~~June 30, 2018~~March 31, 2019

~~Net~~During the three months ended March 31, 2020 we had net cash provided by financing activities ~~increased~~compared with net use of cash in financing activities during the ~~six~~three months ended ~~June 30, 2019, compared with~~March 31, 2019. During the ~~prior year comparable period. The~~three months ended March 31, 2020, we had higher net credit facility borrowings in order to increase incash on hand and provide financial flexibility to enhance our ability to address potential future uncertainties regarding the ~~source~~impact of ~~cash was primarily driven by~~the COVID-19 pandemic. During the three months ended March 31, 2020, we also repurchased a ~~decrease in~~lower amount of our common stock, increased payments on debt instruments, and ~~less common stock repurchased, which was partially offset by the use~~had an absence of ~~cash to purchase all of the outstanding~~ minority interest ~~in Pulse8, Inc. and lower net credit facility borrowing~~purchases compared with the ~~six~~three months ended June 30, 2018. The higher net credit facility borrowings during the six months ended June 30, 2018 was the result of additional borrowings used to fund the acquisitions of Practice Fusion and Health Grid.March 31, 2019.

The following table summarizes our required minimum future payments under the 0.875% Convertible Senior Notes, the 1.25% Notes and the Senior Secured Credit Facility as of ~~June 30, 2019.~~March 31, 2020.


(In thousands)	Total		Remainder of 2019		2020		2021		2022		2023		Thereafter		Total		Remainder of 2020		2021		2022		2023		2024		Thereafter
Principal payments:
1.25% Cash Convertible Senior Notes ⁽¹⁾	$	345,000	$	0	$	345,000	$	0	$	0	$	0	$	0
0.875% Convertible Senior Notes ⁽¹⁾															$	218,000	$	0	$	0	$	0	$	0	$	0	$	218,000
1.25% Cash Convertible Senior Notes ⁽²⁾																345,000		345,000		0		0		0		0		0
Senior Secured Credit Facility ⁽²⁾⁽³⁾		520,000		10,000		27,500		30,000		37,500		415,000		0		540,000		22,500		30,000		37,500		450,000		0		0
Total principal payments		865,000		10,000		372,500		30,000		37,500		415,000		0		1,103,000		367,500		30,000		37,500		450,000		0		218,000
Interest payments:
1.25% Cash Convertible Senior Notes ⁽¹⁾		6,469		2,156		4,313		0		0		0		0
Senior Secured Credit Facility ^{(2) (3)}		76,193		10,940		21,456		20,282		19,007		4,508		0
0.875% Convertible Senior Notes																13,471		1,070		1,908		1,908		1,908		1,908		4,769
1.25% Cash Convertible Senior Notes ⁽²⁾																2,156		2,156		0		0		0		0		0
Senior Secured Credit Facility ^{(3) (4)}																46,015		12,223		15,578		14,705		3,509		0		0
Total interest payments		82,662		13,096		25,769		20,282		19,007		4,508		0		61,642		15,449		17,486		16,613		5,417		1,908		4,769
Total future debt payments	$	947,662	$	23,096	$	398,269	$	50,282	$	56,507	$	419,508	$	0	$	1,164,642	$	382,949	$	47,486	$	54,113	$	455,417	$	1,908	$	222,769

⁽¹⁾⁽²⁾Assumes no cash conversions of the 1.25% Notes prior to their maturity on July 1, 2020.

⁽²⁾~~Assumes no additional borrowings after June 30, 2019, payment of any required periodic installments of principal and that all drawn amounts are repaid upon maturity.~~

⁽³⁾~~Assumes LIBOR plus the applicable margin remain constant at the rate in effect on June 30, 2019, which was 3.90%~~

~~We plan to fund the expected $145 million settlement with the DOJ related to its investigations through future cash flows and draws on our Revolving Facility.~~ On August 7, 2019, we entered into a First Amendment to the Second Amended Credit Agreement with JPMorgan Chase Bank, N.A., as administrative agent, and certain other lenders. Refer to Note 17, “Subsequent Events” of the Notes to the Consolidated Financial Statements in Part I, Item 1 of this Form 10-Q for further information regarding this amendment.

~~Our total investment in research~~Research and development ~~efforts during 2019~~investment is expected to ~~increase, compared with 2018,~~decline for the remainder of 2020 as ~~we continue to build and expand~~ the ~~capabilities and functionality of our traditional ambulatory, acute and post-acute platforms as well as those of Veradigm and our consumer health offerings. Our total~~company is implementing cost reduction initiatives. Total spending consists of research and development costs directly recorded to expense, which are offset by the capitalization of eligible development costs.

~~During 2019, we completed renegotiations with Atos to improve the operating cost structure of our private cloud hosting operations and extended our contract through 2025.~~ The new agreement also provides for the payment of initial annual base fees of $35 million per year (increase from $30 million) plus charges for volume-based services currently projected using volumes estimated based on historical actuals and forecasted projections. During the three and six months ended June 30, 2019, we incurred $21 million and $44 million, respectively, of expenses under our agreement with Atos. These costs are included in cost of revenue in our consolidated statements of operations.

To supplement our statement of operations, the table below presents a non-GAAP measure of research and development-related expenses, that we believe is a useful metric for evaluating how we are investing in research and development.

We believe that our cash and cash equivalents of ~~$148~~$212 million as of ~~June 30, 2019,~~March 31, 2020, our future cash flows, ~~and~~ our borrowing capacity under our Revolving Facility and access to capital markets, taken together, provide adequate resources to meet future operating needs as well as scheduled payments of short and long-term debt. We cannot provide assurance that our actual cash requirements will not be greater than we expect as of the date of this Form 10-Q. We will, from time to time, consider the acquisition of, or investment in, complementary businesses, products, services and technologies and the repurchase of our common stock under our 2018 stock repurchase program, each of which might impact our liquidity requirements or cause us to borrow under our Revolving Facility or issue additional equity or debt securities.

We have various contractual obligations, which are recorded as liabilities in our consolidated financial statements. During the three months ended ~~June 30, 2019,~~March 31, 2020, there were no material changes, outside of the ordinary course of business, to our contractual obligations and purchase commitments previously disclosed in our Form 10-K.

Our market risk disclosures set forth in Part II, Item 7A, “Quantitative and Qualitative Disclosures About Market Risk” of our Form 10-K have not changed materially during the ~~six~~three months ended ~~June 30, 2019.~~March 31, 2020.

Under the direction of our chief executive officer and chief financial officer, we evaluated our disclosure controls and procedures pursuant to Rule 13a-15(b) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and concluded that our disclosure controls and procedures were effective as of ~~June 30, 2019.~~March 31, 2020.

We have implemented, and continue to refine, internal controls related to the new ~~leasing~~credit loss accounting standard which we adopted on January 1, ~~2019.~~2020. There have been no other changes in our internal control over financial reporting during the quarter ended ~~June 30, 2019,~~March 31, 2020, which were identified in connection with management’s evaluation required by paragraph (d) of Rules 13a-15 and 15d-15 under the Exchange Act, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

We hereby incorporate by reference Note ~~13,~~14, “Contingencies,” of the Notes to Consolidated Financial Statements in Part I, Item 1 of this Form 10-Q.

Except as follows, there have been no material changes during the ~~six~~three months ended ~~June 30, 2019~~March 31, 2020 from the risk factors as previously disclosed in our Form 10-K.

~~If we fail to finalize our agreement in principle with~~The novel coronavirus (COVID-19) pandemic could materially adversely impact the DOJ or fail to comply with the terms of any such final settlement documents, including a deferred prosecution agreement and a civil settlement agreement, that we expect to negotiate and sign in connection with the resolution of the DOJ’s investigations into certain of Practice Fusion’s business practices, our business, results of operations, ~~and~~ financial condition, liquidity and cash flowsof us and our clients.

The COVID-19 pandemic and efforts to control its spread could have a significant impact on our operations and the operations of our healthcare clients. The magnitude and duration of the disruption and resulting decline in business activity will largely depend on future developments which are highly uncertain and cannot be predicted. Because our hospital and other health care provider clients have understandably prioritized their resources towards the COVID-19 outbreak, we expect that our business will be ~~materially~~adversely affected, including by negatively impacting the demand for our solutions (including the timeframes for the implementation of our solutions) and ~~adversely affected. In addition, even if we finalize and comply with those agreements,~~ the costs and burdens of compliance could be significant, and we may face additional investigations and proceedings from other governmental entities or third parties related to the same or similar conduct underlying the agreements with the DOJ.

On August 8, 2019, we announced that we reached an agreement in principle with the DOJ to resolve the DOJ’s civil and criminal investigations into Practice Fusion. We also announced that we accrued an estimated loss of $145 million related to this matter. See Note 13, “Contingencies”timing of the ~~Notes~~payment for our solutions, while restricting our sales, marketing, and other important business activities. We are unable to ~~Consolidated Financial Statements in Part I, Item 1 of this Form 10-Q for additional information. We expect that a final settlement with~~predict the DOJ, if it were to be completed, would include other material non-financial terms and conditions, including a deferred prosecution agreement and a civil settlement agreement. A variety of material issues remain subject to further negotiation and approval by us and the government before the agreement in principle can be finalized, and the terms described above may change following further negotiation. We cannot provide assurances that our efforts to reach a final settlement with the DOJ will be successful or, if they are, the timing or final termsmagnitude of any such ~~settlement.~~affect.

~~If completed~~As a result of the COVID-19 pandemic, certain industry events that we sponsor or at which we present and ~~executed,~~certain client events have been canceled, postponed or moved to virtual-only experiences, and we have instituted a work-from-home policy for most of our employees. Concerns over the ~~final settlement documents with~~economic impact of the DOJ could contain material non-financial terms and conditions. In addition, compliance with the terms of any such final settlement documents could impose significant costs and burdens on us. If we fail to comply with any such final settlement documents, the DOJ may impose substantial monetary penalties, exclude Practice Fusion from Medicare, MedicaidCOVID-19 pandemic have also caused extreme volatility in financial and other ~~federal healthcare programs, and/~~capital markets which has and may continue to adversely impact our stock price and our ability to access capital markets. If COVID-19, or ~~criminally prosecute Practice Fusion, which~~another highly infectious or contagious disease, spreads or the response to contain COVID-19 is unsuccessful, we could ~~have a material~~experience adverse ~~effect~~effects on our business, financial condition, and results of operations.

~~If a final agreement cannot be reached,~~To the extent the COVID-19 pandemic adversely affects our business and financial results, it ~~is likely that~~may also have the ~~DOJ will bring one or more enforcement actions against Practice Fusion. If the federal government were to file enforcement actions against Practice Fusion as a result~~effect of heightening many of the ~~investigations and could establish~~other risks described in the ~~elements of a violation of relevant laws, we could be subject~~other “Risk Factors” that are incorporated by reference herein, such as those relating to damages, which could be substantial, fines and penalties, or other criminal, civil or administrative sanctions, and we would expect to incur significant costs in connection with such enforcement action, regardless of the outcome. If any or all of these events occur, our ~~business, financial condition and results of operations could be materially and adversely affected.~~

Other government investigations or legal or regulatory proceedings, including investigations or proceedings brought by private litigants or shareholders, federal agencies, private insurers and states’ attorneys general, may follow as a consequence of our agreement in principle with the DOJ or any final settlement documents, any of which could result in substantial expenses, divert management’s attention from other business concerns and have a material adverse effect on our business, results of operations and financial condition. We may also be subject to negative publicity related to these matters that could harm our reputation, reduce demand for our solutionsproducts and services, ~~result in employee attrition~~sales cycles and ~~negatively impact our stock price.~~implementation schedules, the retention of key employees, financial performance and debt obligations.

On ~~May 29, 2019, the Company issued 61,448 shares~~August 2, 2018, we announced that our Board of Directors approved a stock repurchase program under which we may repurchase up to $250 million of our common stock ~~to a commercial partner pursuant to~~through December 31, 2020. Any repurchase activity will depend on many factors such as our working capital needs, cash requirements for investments, debt repayment obligations, economic and market conditions at the ~~terms~~time, including the price of ~~a commercial agreement. As of June 30, 2019, the Company has issued an aggregate of 159,666 shares of~~our common stock, ~~to this commercial partner pursuant to~~and other factors that we consider relevant. Our stock purchase program may be accelerated, suspended, delayed or discontinued at any time.

The following table summarizes the ~~agreement (including~~stock repurchase activity during the ~~May 2019 issuance). The number~~three months ended March 31, 2020 and the approximate dollar value of shares tothat may yet be ~~issued~~purchased under ~~the agreement is calculated annually as a rebate based on a percentage of recognized revenue during the term of the agreement, which has a ten-year term ending in 2026. The shares of common~~our stock ~~have been offered and sold pursuant to Section 4(a)(2) of the Securities Act of 1933.~~repurchase program:

On August 6, 2019, we entered into a First Amendment to the Second Amended Credit Agreement with JPMorgan Chase Bank, N.A., as administrative agent, and certain other lenders. This amendment amends the definition of “EBITDA” to give us financial flexibility to settle the DOJ’s criminal and civil investigations of Practice Fusion while continuing to remain in compliance with the covenants of our Second Amended Credit Agreement. None of the original terms of our Second Amended Credit Agreement relating to scheduled future principal payments, applicable interest rates and margins, or borrowing capacity under our Revolving Facility were amended.

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

		PAGE
PART I. FINANCIAL INFORMATION		3
Item 1.	Financial Statements (unaudited)	3
Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	2926
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	4237
Item 4.	Controls and Procedures	4237
PART II. OTHER INFORMATION		4338
Item 1.	Legal Proceedings	4338
Item 1A.	Risk Factors	4338
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	43
~~Item 5.~~	~~Other Information~~	4438
Item 6.	Exhibits	4439
SIGNATURES		4540

(In thousands)	Total
Balance at January 1, 2020	$	5,341
Current period provision		0
Balance at March 31, 2020	$	5,341
Less: Contract assets, short-term		1,068
Total contract assets, long-term	$	4,273

(In thousands)	Six Months Ended June 30, 2019
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	14,688
Operating cash flows from finance leases	$	5
Financing cash flows from finance leases	$	70
Right-of-use assets obtained in exchange for lease obligations:
Operating leases	$	128,664
Finance leases	$	263

(In thousands)	Core Clinical and Financial Solutions			Data, Analytics and Care Coordination		Unallocated Amounts		Total
Balance as of December 31, 2019		769,995			517,359		74,663		1,362,017
Foreign exchange translation		(902	)		0		0		(902	)
Balance as of March 31, 2020	$	769,093		$	517,359	$	74,663	$	1,361,115

(In thousands)	Foreign Currency Translation Adjustments			Unrealized Net Gains on Foreign Exchange Contracts			Total
Balance as of December 31, 2018 ⁽¹⁾	$	(5,584	)	$	195		$	(5,389	)
Other comprehensive income (loss) before reclassifications		539			252			791
Net (gains) losses reclassified from accumulated other comprehensive loss		0			(124	)		(124	)
Net other comprehensive loss		539			128			667
Balance as of June 30, 2019 ⁽²⁾	$	(5,045	)	$	323		$	(4,722	)


☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934


☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

	Three Months Ended June 30, 2018
(In thousands)	Provider		Veradigm		Unallocated			Total
Software delivery, support and maintenance	$	253,754	$	32,807	$	(2,076	)	$	284,485
Client services		159,713		690		(3,424	)		156,979
Total revenue	$	413,467	$	33,497	$	(5,500	)	$	441,464

	Six Months Ended June 30, 2019
(In thousands)	Provider		Veradigm		Unallocated		Total
Software delivery, support and maintenance	$	484,794	$	71,493	$	4,248	$	560,535
Client services		313,503		2,144		327		315,974
Total revenue	$	798,297	$	73,637	$	4,575	$	876,509

(In thousands, except lease term and discount rate)	June 30, 2019
Operating leases:
Right-of-use assets - operating leases	$	96,097
Current operating lease liabilities	$	24,501
Long-term operating lease liabilities	$	93,117

Finance leases:
Fixed assets, gross	$	524
Accumulated depreciation		322
Fixed assets, net	$	202

Current finance lease liabilities ⁽¹⁾	$	120
Long-term finance lease liabilities ⁽²⁾	$	72

Weighted average remaining lease term (in years)
Operating leases		6
Finance leases		2

Weighted average discount rate
Operating leases		4.6	%
Finance leases		5.1	%

(In thousands, except per share amounts)
					Total Number		Approximate
					Of Shares		Dollar Value
					Purchased		Of Shares
		��			As Part Of		That May Yet
	Total		Average		Publicly		Be Purchased
	Number		Price		Announced		Under The
	Of Shares		Paid Per		Plans Or		Plans Or
Period (Based on Trade Date)	Purchased		Share		Programs		Programs
01/01/20—01/31/20		0	$	0.00		0	$	101,800
02/01/20—02/29/20		0	$	0.00		0	$	101,800
03/01/20—03/31/20		1,449	$	6.85		1,449	$	92,116
		1,449	$	6.85		1,449



Exhibit Number	Exhibit Description	Filed Herewith	Furnished Herewith
10.1	~~Allscripts Healthcare Solutions, Inc. 2019 Stock Incentive Plan (incorporated by reference from Annex A to Allscripts Definitive Proxy Statement filed with the SEC on April 12, 2019)~~

~~10.2~~	~~First Amendment, dated as of August 7, 2019, to the Second Amended and Restated Credit~~Letter Agreement, dated asApril 8, 2020, between the U.S. Department of ~~February 15, 2018, among Allscripts Healthcare Solutions, Inc., Allscripts Healthcare, LLC,~~Justice and Practice Fusion, amending Exhibit A of the ~~lenders from time to time parties thereto, JPMorgan Chase Bank, N.A. as Administrative Agent~~Civil Settlement Agreement dated January 26, 2020	X

31.1	Rule 13a - 14(a) Certification of Chief Executive Officer	X

31.2	Rule 13a - 14(a) Certification of Chief Financial Officer	X

32.1	Section 1350 Certifications of Chief Executive Officer and Chief Financial Officer		X

101.INS	Inline XBRL Instance Document – the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline document	X

101.SCH	Inline XBRL Taxonomy Extension Schema	X

101.CAL	Inline XBRL Taxonomy Extension Calculation Linkbase	X

101.LAB	Inline XBRL Taxonomy Extension Label Linkbase	X

101.PRE	Inline XBRL Taxonomy Extension Presentation Linkbase	X

101.DEF	Inline XBRL Taxonomy Definition Linkbase	X

104	The cover page from the Company’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2020, formatted in Inline XBRL and included in Exhibit 101.	X

ALLSCRIPTS HEALTHCARE SOLUTIONS, INC.

By:		/s/ ~~Dennis M. Olis~~Richard J. Poulton
		~~Dennis M. Olis~~Richard J. Poulton
		President and Chief Financial Officer
		(Principal Financial and Accounting Officer and Duly Authorized Officer)

Large accelerated filer

Accelerated filer

Non-accelerated filer

Smaller reporting company

Emerging growth company