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

Exhibit 99.2

WEBMD HEALTH CORP.

CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except per share data, unaudited)

	Three Months Ended March 31,
	2014		2013
Revenue	$	133,832	$	112,762
Cost of operations		52,564		46,943
Sales and marketing		32,911		30,933
General and administrative		23,781		23,534
Depreciation and amortization		7,328		6,853
Interest income		15		21
Interest expense		6,172		5,832
Income (loss) before income income tax provision		11,091		(1,312	)
Income tax provision		4,825		226
Net income (loss)	$	6,266	$	(1,538	)
Net income (loss) per common share:
Basic	$	0.16	$	(0.03	)
Diluted	$	0.15	$	(0.03	)
Weighted-average shares outstanding used in computing income (loss) per common share:
Basic		39,268		49,007
Diluted		41,852		49,007

WEBMD HEALTH CORP.

CONSOLIDATED SUPPLEMENTAL FINANCIAL INFORMATION

(In thousands, unaudited)

	Three Months Ended March 31,
	2014			2013
Revenue
Public portal advertising and sponsorship	$	109,203		$	93,438
Private portal services		24,629			19,324
	$	133,832		$	112,762
Earnings before interest, taxes, non-cash and other items (“Adjusted EBITDA”) (a)	$	33,266		$	21,289
Interest, taxes, non-cash and other items (b)
Interest income		15			21
Interest expense		(6,172	)		(5,832	)
Income tax provision		(4,825	)		(226	)
Depreciation and amortization		(7,328	)		(6,853	)
Non-cash stock-based compensation		(8,690	)		(9,937	)
Net income (loss)	$	6,266		$	(1,538	)

(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)

	March 31, 2014		December 31, 2013
	(unaudited)
Assets
Cash and cash equivalents	$	778,401	$	824,880
Accounts receivable, net		134,241		124,232
Prepaid expenses and other current assets		12,544		13,243
Deferred tax assets		13,588		13,620
Total current assets		938,774		975,975
Property and equipment, net		62,151		64,884
Goodwill		202,980		202,980
Intangible assets, net		13,266		13,834
Deferred tax assets		38,649		38,802
Other assets		28,144		29,153
Total Assets	$	1,283,964	$	1,325,628
Liabilities and Stockholders’ Equity
Accrued expenses	$	54,910	$	73,739
Deferred revenue		99,638		85,148
Liabilities of discontinued operations		1,506		1,506
Total current liabilities		156,054		160,393
2.25% convertible notes due 2016		252,232		252,232
2.50% convertible notes due 2018		400,000		400,000
1.50% convertible notes due 2020		300,000		300,000
Other long-term liabilities		21,673		22,103
Stockholders’ equity		154,005		190,900
Total Liabilities and Stockholders’ Equity	$	1,283,964	$	1,325,628

WEBMD HEALTH CORP.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands, unaudited)

	Three Months Ended March 31,
	2014			2013
Cash flows from operating activities:
Net income (loss)	$	6,266		$	(1,538	)
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Depreciation and amortization		7,328			6,853
Non-cash interest, net		1,128			1,082
Non-cash stock-based compensation		8,690			9,937
Deferred income taxes		201			(99	)
Changes in operating assets and liabilities:
Accounts receivable		(10,009	)		4,809
Prepaid expenses and other, net		210			(193	)
Accrued expenses and other long-term liabilities		(20,401	)		(14,850	)
Deferred revenue		14,490			5,044
Net cash provided by operating activities		7,903			11,045
Cash flows from investing activities:
Purchases of property and equipment		(5,533	)		(2,876	)
Net cash used in investing activities		(5,533	)		(2,876	)
Cash flows from financing activities:
Proceeds from exercise of stock options		17,482			672
Cash used for withholding taxes due on stock-based awards		(5,326	)		(174	)
Purchases of treasury stock		(65,052	)		(1,281	)
Excess tax benefit on stock-based awards		4,047			—
Net cash used in financing activities		(48,849	)		(783	)
Net (decrease) increase in cash and cash equivalents		(46,479	)		7,386
Cash and cash equivalents at beginning of period		824,880			991,835
Cash and cash equivalents at end of period	$	778,401		$	999,221