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

Exhibit 99.2

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

	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2008		2007		2008			2007
Revenue	$	89,176	$	77,270	$	170,858		$	149,214
Costs and expenses:
Cost of operations		32,763		28,997		64,333			57,615
Sales and marketing		25,460		21,929		51,290			44,799
General and administrative		14,614		15,981		28,389			31,486
Impairment of auction rate securities		—		—		27,406			—
Depreciation and amortization		7,188		6,941		13,973			12,932
Interest income		2,350		3,051		5,803			5,036
Income (loss) from continuing operations before income tax provision		11,501		6,473		(8,730	)		7,418
Income tax provision		5,149		1,332		8,253			1,542
Income (loss) from continuing operations		6,352		5,141		(16,983	)		5,876
Income from discontinued operations, net of tax		—		249		—			220
Net income (loss)	$	6,352	$	5,390	$	(16,983	)	$	6,096
Basic income (loss) per common share:
Income (loss) from continuing operations	$	0.11	$	0.09	$	(0.29	)	$	0.10
Income from discontinued operations		—		—		—			0.01
Net Income (loss)	$	0.11	$	0.09	$	(0.29	)	$	0.11
Diluted income (loss) per common share:
Income (loss) from continuing operations	$	0.11	$	0.09	$	(0.29	)	$	0.10
Income from discontinued operations		—		—		—			—
Net Income (loss)	$	0.11	$	0.09	$	(0.29	)	$	0.10
Weighted-average shares outstanding used in computing basic and diluted net income (loss) per common share:
Basic		57,693		57,071		57,664			57,023
Diluted		59,061		59,748		57,664			59,689

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

	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2008			2007			2008			2007
Revenue
Online Services:
Advertising and sponsorship	$	62,383		$	52,436		$	118,448		$	99,857
Licensing		21,866			19,799			43,789			39,914
Content syndication and other		345			653			762			1,537
Total Online Services		84,594			72,888			162,999			141,308
Publishing and Other Services		4,582			4,382			7,859			7,906
	$	89,176		$	77,270		$	170,858		$	149,214
Earnings before interest, taxes, depreciation, amortization and other non-cash items (“Adjusted EBITDA”) (a)
Online Services	$	18,800		$	14,042		$	35,331		$	27,034
Publishing and Other Services		1,027			863			273			505
		19,827			14,905			35,604			27,539
Adjusted EBITDA per basic common share	$	0.34		$	0.26		$	0.62		$	0.48
Adjusted EBITDA per diluted common share (b)	$	0.34		$	0.25		$	0.60		$	0.46
Interest, taxes, depreciation, amortization and other non-cash items (c)
Interest income		2,350			3,051			5,803			5,036
Depreciation and amortization		(7,188	)		(6,941	)		(13,973	)		(12,932	)
Non-cash advertising		—			—			(1,558	)		(2,320	)
Non-cash stock-based compensation		(3,488	)		(4,542	)		(7,200	)		(9,905	)
Impairment of auction rate securities investments		—			—			(27,406	)		—
Income tax provision		(5,149	)		(1,332	)		(8,253	)		(1,542	)
Income (loss) from continuing operations		6,352			5,141			(16,983	)		5,876
Income from discontinued operations, net of tax		—			249			—			220
Net income (loss)	$	6,352		$	5,390		$	(16,983	)	$	6,096
Basic income (loss) per common share:
Income (loss) from continuing operations	$	0.11		$	0.09		$	(0.29	)	$	0.10
Income from discontinued operations		—			—			—			0.01
Net income (loss)	$	0.11		$	0.09		$	(0.29	)	$	0.11
Diluted income (loss) per common share:
Income (loss) from continuing operations	$	0.11		$	0.09		$	(0.29	)	$	0.10
Income from discontinued operations		—			—			—			—
Net income (loss)	$	0.11		$	0.09		$	(0.29	)	$	0.10
Weighted-average shares outstanding used in computing basic and diluted net income (loss) per common share:
Basic		57,693			57,071			57,664			57,023
Diluted		59,061			59,748			57,664			59,689

(a)	See Annex A — Explanation of Non-GAAP Financial Measures
(b)	Six months ended June 30, 2008 Adjusted EBITDA per share is calculated based on 59,103 diluted shares
(c)	Reconciliation of Adjusted EBITDA to income (loss) from continuing operations

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

	June 30,		December 31,
	2008		2007
ASSETS
Current assets:
Cash and cash equivalents	$	186,490	$	213,753
Short-term investments		138,753		80,900
Accounts receivable, net		68,865		86,081
Current portion of prepaid advertising		2,275		2,329
Due from HLTH		—		1,153
Other current assets		9,259		10,840
Total current assets		405,642		395,056
Property and equipment, net		46,554		48,589
Prepaid advertising		3,017		4,521
Goodwill		221,281		221,429
Intangible assets, net		31,323		36,314
Other assets		7,317		12,955
	$	715,134	$	718,864
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accrued expenses	$	20,203	$	26,498
Deferred revenue		87,401		76,401
Due to HLTH		72		—
Total current liabilities		107,676		102,899
Other long-term liabilities		8,890		9,210
Stockholders’ equity		598,568		606,755
	$	715,134	$	718,864

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

	Six Months Ended
	June 30,
	2008			2007
Cash flows from operating activities:
Net (loss) income	$	(16,983	)	$	6,096
Adjustments to reconcile net (loss) income to net cash provided by operating activities:
Income from discontinued operations, net of tax		—			(220	)
Depreciation and amortization		13,973			12,932
Non-cash advertising		1,558			2,320
Non-cash stock-based compensation		7,200			9,905
Deferred income taxes		6,667			577
Impairment of auction rate securities		27,406			—
Changes in operating assets and liabilities:
Accounts receivable		17,216			7,719
Other assets		(1,394	)		74
Accrued expenses and other long-term liabilities		(5,131	)		(7,271	)
Due to HLTH		1,246			2,136
Deferred revenue		11,000			10,576
Net cash provided by continuing operations		62,758			44,844
Net cash provided by discontinued operations		—			48
Net cash provided by operating activities		62,758			44,892
Cash flows from investing activities:
Proceeds from maturities and sales of available-for-sale securities		41,300			95,256
Purchases of available-for-sale securities		(127,900	)		(112,667	)
Purchases of property and equipment		(6,946	)		(9,764	)
Cash received from sale of business and business combinations, net of fees		1,133			—
Net cash used in investing activities		(92,413	)		(27,175	)
Cash flows from financing activities:
Proceeds from issuance of common stock		2,392			5,723
Net cash transfers with HLTH		—			145,257
Net cash provided by financing activities		2,392			150,980
Net (decrease) increase in cash and cash equivalents		(27,263	)		168,697
Cash and cash equivalents at beginning of period		213,753			44,660
Cash and cash equivalents at end of period	$	186,490		$	213,357