WebMD Health (WBMD) 8-K WebMD Announces Third Quarter Financial Results

Exhibit 99.2

WEBMD HEALTH CORP.
CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share data, unaudited)

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2009		2008		2009			2008
Revenue	$	111,568	$	96,797	$	300,463		$	263,451
Cost of operations		41,965		34,225		117,759			97,120
Sales and marketing		26,265		26,021		80,623			76,068
General and administrative		15,961		14,774		45,826			42,465
Depreciation and amortization		6,988		7,056		20,729			20,815
Interest income		834		2,616		2,733			8,419
Impairment of auction rate securities		—		—		—			27,406
Income from continuing operations before income tax provision		21,223		17,337		38,259			7,996
Income tax provision		8,622		7,375		15,469			15,308
Income (loss) from continuing operations		12,601		9,962		22,790			(7,312	)
Income (loss) from discontinued operations, net of tax		190		804		(5,100	)		1,095
Net income (loss)	$	12,791	$	10,766	$	17,690		$	(6,217	)
Basic income (loss) per common share:
Income (loss) from continuing operations	$	0.22	$	0.17	$	0.39		$	(0.13	)
Income (loss) from discontinued operations		0.00		0.02		(0.09	)		0.02
Net income (loss)	$	0.22	$	0.19	$	0.30		$	(0.11	)
Diluted income (loss) per common share:
Income (loss) from continuing operations	$	0.21	$	0.17	$	0.39		$	(0.13	)
Income (loss) from discontinued operations		0.00		0.01		(0.09	)		0.02
Net income (loss)	$	0.21	$	0.18	$	0.30		$	(0.11	)
Weighted-average shares outstanding used in computing basic and diluted net income (loss) per common share:
Basic		57,777		57,770		57,676			57,699
Diluted		58,844		59,111		58,445			57,699

WEBMD HEALTH CORP.
CONSOLIDATED SUPPLEMENTAL FINANCIAL INFORMATION
(In thousands, except per share data, unaudited)

	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2009			2008			2009			2008
Revenue
Public portal advertising and sponsorship	$	89,414		$	74,658		$	232,695		$	197,523
Private portal services		22,154			22,139			67,768			65,928
	$	111,568		$	96,797		$	300,463		$	263,451
Earnings before interest, taxes, non-cash and other items (“Adjusted EBITDA”) (a)	$	33,123		$	25,467		$	75,029		$	60,191
Adjusted EBITDA per basic common share	$	0.57		$	0.44		$	1.30		$	1.04
Adjusted EBITDA per diluted common share	$	0.56		$	0.43		$	1.28		$	1.04
Interest, taxes, non-cash and other items (b)
Interest income		834			2,616			2,733			8,419
Depreciation and amortization		(6,988	)		(7,056	)		(20,729	)		(20,815	)
Non-cash advertising		—			(178	)		(1,753	)		(1,736	)
Non-cash stock-based compensation		(5,746	)		(3,512	)		(17,021	)		(10,657	)
Impairment of auction rate securities		—			—			—			(27,406	)
Income tax provision		(8,622	)		(7,375	)		(15,469	)		(15,308	)
Income (loss) from continuing operations		12,601			9,962			22,790			(7,312	)
Income (loss) from discontinued operations, net of tax		190			804			(5,100	)		1,095
Net income (loss)	$	12,791		$	10,766		$	17,690		$	(6,217	)
Basic income (loss) per common share:
Income (loss) from continuing operations	$	0.22		$	0.17		$	0.39		$	(0.13	)
Income (loss) from discontinued operations		0.00			0.02			(0.09	)		0.02
Net income (loss)	$	0.22		$	0.19		$	0.30		$	(0.11	)
Diluted income (loss) per common share:
Income (loss) from continuing operations	$	0.21		$	0.17		$	0.39		$	(0.13	)
Income (loss) from discontinued operations		0.00			0.01			(0.09	)		0.02
Net income (loss)	$	0.21		$	0.18		$	0.30		$	(0.11	)
Weighted-average shares outstanding used in computing per share amounts:
Basic		57,777			57,770			57,676			57,699
Diluted		58,844			59,111			58,445			57,699

(a)	See Annex A — Explanation of Non-GAAP Financial Measures
(b)	Reconciliation of Adjusted EBITDA to net income (loss)

WEBMD HEALTH CORP.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands, unaudited)

	September 30, 2009		December 31, 2008
ASSETS
Current assets:
Cash and cash equivalents	$	275,250	$	191,659
Accounts receivable, net		87,072		93,082
Current portion of prepaid advertising		—		1,753
Other current assets		9,286		11,358
Assets of discontinued operations		—		12,575
Total current assets		371,608		310,427
Investments		126,564		133,563
Property and equipment, net		52,286		54,165
Goodwill		208,967		208,967
Intangible assets, net		21,416		26,237
Other assets		13,259		22,573
	$	794,100	$	755,932
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accrued expenses	$	31,760	$	31,241
Deferred revenue		83,861		79,613
Due to HLTH		1,378		427
Liabilities of discontinued operations		—		2,599
Total current liabilities		116,999		113,880
Other long-term liabilities		7,539		8,334
Stockholders’ equity		669,562		633,718
	$	794,100	$	755,932

WEBMD HEALTH CORP.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands, unaudited)

	Nine Months Ended September 30,
	2009			2008
Cash flows from operating activities:
Net income (loss)	$	17,690		$	(6,217	)
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Loss (income) from discontinued operations, net of tax		5,100			(1,095	)
Depreciation and amortization		20,729			20,815
Non-cash advertising		1,753			1,736
Non-cash stock-based compensation		17,021			10,657
Deferred and other income taxes		14,835			14,977
Impairment of auction rate securities		—			27,406
Changes in operating assets and liabilities:
Accounts receivable		6,010			6,275
Other assets		(587	)		(2,651	)
Accrued expenses and other long-term liabilities		(276	)		(286	)
Due to HLTH		951			563
Deferred revenue		4,248			5,367
Net cash provided by continuing operations		87,474			77,547
Net cash provided by discontinued operations		728			3,205
Net cash provided by operating activities		88,202			80,752
Cash flows from investing activities:
Proceeds from maturities and sales of available-for-sale securities		1,800			43,300
Purchases of available-for-sale securities		—			(127,900	)
Purchases of property and equipment		(14,131	)		(15,014	)
Cash received from sale of businesses, net of fees		2,840			1,133
Net cash used in continuing operations		(9,491	)		(98,481	)
Net cash used in discontinued operations		(8	)		(40	)
Net cash used in investing activities		(9,499	)		(98,521	)
Cash flows from financing activities:
Proceeds from issuance of common stock		4,823			3,453
Tax benefit on stock-based awards		65			315
Net cash provided by financing activities		4,888			3,768
Net increase (decrease) in cash and cash equivalents		83,591			(14,001	)
Cash and cash equivalents at beginning of period		191,659			213,753
Cash and cash equivalents at end of period	$	275,250		$	199,752