Document and Entity Information
Document and Entity Information - USD ($) $ in Billions | 12 Months Ended | ||
Feb. 28, 2023 | Apr. 21, 2023 | Aug. 31, 2022 | |
Document and Entity Information [Abstract] | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Period End Date | Feb. 28, 2023 | ||
Document Transition Report | false | ||
Entity File Number | 001-39348 | ||
Entity Registrant Name | ACCOLADE, INC. | ||
Entity Incorporation, State or Country Code | DE | ||
Entity Tax Identification Number | 01-0969591 | ||
Entity Address, Address Line One | 1201 Third Avenue | ||
Entity Address, Address Line Two | Suite 1700 | ||
Entity Address, City or Town | Seattle | ||
Entity Address State Or Province | WA | ||
Entity Address, Postal Zip Code | 98101 | ||
City Area Code | 206 | ||
Local Phone Number | 926-8100 | ||
Title of 12(b) Security | Common Stock, $0.0001 par value per share | ||
Trading Symbol | ACCD | ||
Security Exchange Name | NASDAQ | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Small Business | false | ||
Entity Emerging Growth Company | false | ||
ICFR Auditor Attestation Flag | true | ||
Entity Shell Company | false | ||
Entity Public Float | $ 658.5 | ||
Entity Common Stock, Shares Outstanding | 73,634,043 | ||
Entity Central Index Key | 0001481646 | ||
Current Fiscal Year End Date | --02-28 | ||
Document Fiscal Year Focus | 2023 | ||
Document Fiscal Period Focus | FY | ||
Amendment Flag | false | ||
Auditor Name | KPMG LLP | ||
Auditor Firm ID | 185 | ||
Auditor Location | Philadelphia, PA |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Feb. 28, 2023 | Feb. 28, 2022 |
Current assets: | ||
Cash and cash equivalents | $ 321,083 | $ 365,853 |
Accounts receivable, net | 23,435 | 21,116 |
Unbilled revenue | 3,260 | 9,685 |
Current portion of deferred contract acquisition costs | 4,022 | 3,015 |
Prepaid and other current assets | 14,149 | 9,468 |
Total current assets | 365,949 | 409,137 |
Property and equipment, net | 14,763 | 11,797 |
Operating lease right-of-use assets | 29,525 | 33,126 |
Goodwill | 278,191 | 577,896 |
Intangible assets, net | 203,202 | 244,690 |
Deferred contract acquisition costs | 9,815 | 7,205 |
Other assets | 1,624 | 1,678 |
Total assets | 903,069 | 1,285,529 |
Current liabilities: | ||
Accounts payable | 10,155 | 7,837 |
Accrued expenses and other current liabilities | 11,744 | 11,000 |
Accrued compensation | 39,346 | 39,189 |
Due to customers | 15,694 | 16,263 |
Current portion of deferred revenue | 35,191 | 30,875 |
Current portion of operating lease liabilities | 7,284 | 6,589 |
Total current liabilities | 119,414 | 111,753 |
Loans payable, net of unamortized issuance costs | 282,323 | 280,666 |
Operating lease liabilities | 27,189 | 32,486 |
Other noncurrent liabilities | 203 | 4,562 |
Deferred revenue | 154 | 268 |
Total liabilities | 429,283 | 429,735 |
Commitments and Contingencies (note 16) | ||
Stockholders' equity | ||
Common stock par value $0.0001; 500,000,000 shares authorized; 73,089,075 and 67,098,477 shares issued and outstanding at February 28, 2023 and 2022, respectively | 7 | 7 |
Additional paid-in capital | 1,428,073 | 1,350,431 |
Accumulated deficit | (954,294) | (494,644) |
Total stockholders' equity | 473,786 | 855,794 |
Total liabilities and stockholders' equity | $ 903,069 | $ 1,285,529 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Feb. 28, 2023 | Feb. 28, 2022 |
Consolidated Balance Sheets | ||
Common stock, par value | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized | 500,000,000 | 500,000,000 |
Common stock, shares issued | 73,089,075 | 67,098,477 |
Common stock, shares outstanding | 73,089,075 | 67,098,477 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) $ in Thousands | 12 Months Ended | ||
Feb. 28, 2023 | Feb. 28, 2022 | Feb. 28, 2021 | |
Consolidated Statements of Operations | |||
Revenue | $ 363,142 | $ 310,021 | $ 170,358 |
Cost of revenue, excluding depreciation and amortization | 198,905 | 169,019 | 93,673 |
Operating expenses: | |||
Product and technology | 101,347 | 83,664 | 49,955 |
Sales and marketing | 99,113 | 86,765 | 33,711 |
General and administrative | 81,209 | 99,106 | 31,584 |
Depreciation and amortization | 46,377 | 42,608 | 8,212 |
Goodwill impairment | 299,705 | 0 | 0 |
Change in fair value of contingent consideration | (45,416) | ||
Total operating expenses | 627,751 | 266,727 | 123,462 |
Loss from operations | (463,514) | (125,725) | (46,777) |
Interest income (expense), net | 255 | (2,905) | (3,724) |
Other expense | (15) | (133) | (147) |
Loss before income taxes | (463,274) | (128,763) | (50,648) |
Income tax benefit (expense) | 3,624 | 5,639 | (4) |
Net income (loss) | $ (459,650) | $ (123,124) | $ (50,652) |
Net income (loss) per share, Basic | $ (6.45) | $ (1.93) | $ (1.72) |
Net income (loss) per share, Diluted | $ (6.45) | $ (1.93) | $ (1.72) |
Weighted-average common shares outstanding, Basic | 71,279,831 | 63,823,270 | 29,370,594 |
Weighted-average common shares outstanding, Diluted | 71,279,831 | 63,823,270 | 29,370,594 |
Consolidated Statements of Conv
Consolidated Statements of Convertible Preferred Stock and Stockholders Equity (Deficit) - USD ($) $ in Thousands | Convertible Preferred Stock | Common stock IPO | Common stock Follow-on offering | Common stock | Additional paid-in capital IPO | Additional paid-in capital Follow-on offering | Additional paid-in capital | Accumulated deficit | IPO | Follow-on offering | Total |
Balance at Feb. 29, 2020 | $ 2 | $ 64,071 | $ (320,868) | $ (256,795) | |||||||
Balance (shares) at Feb. 29, 2020 | 6,033,450 | ||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||||
Stock options issued value | 5,735 | ||||||||||
Issuance of common stock in public offering, net of issuance costs (shares) | 11,526,134 | 5,750,000 | |||||||||
Issuance of common stock in public offering, net of issuance costs | $ 1 | $ 1 | $ 231,227 | $ 208,046 | $ 231,228 | $ 208,047 | |||||
Exercise of stock options and common stock warrants | 9,272 | 9,272 | |||||||||
Exercise of stock options and common stock warrants (shares) | 1,342,801 | ||||||||||
Issuance of common stock in public offering, net of issuance costs | $ 1 | $ 1 | $ 231,227 | $ 208,046 | $ 231,228 | $ 208,047 | |||||
Conversion of preferred stock into common stock | $ (233,022) | $ 2 | 233,020 | 233,022 | |||||||
Conversion of preferred stock into common stock (shares) | (19,513,939) | 29,479,521 | |||||||||
Automatic exercise of warrants into common stock in connection with initial public offering | 1,401,836 | ||||||||||
Issuance of stock options to satisfy bonus obligation | 5,735 | 5,735 | |||||||||
Issuance of common stock in connection with acquisition | 156 | 156 | |||||||||
Issuance of common stock in connection with acquisition (shares) | 97,812 | ||||||||||
Issuance of common stock in connection with the employee stock purchase plan | 1,259 | 1,259 | |||||||||
Issuance of common stock in connection with the employee stock purchase plan (shares) | 67,498 | ||||||||||
Stock-based compensation expense | 9,576 | 9,576 | |||||||||
Net income (loss) | (50,652) | (50,652) | |||||||||
Balance at Feb. 28, 2021 | $ 6 | 762,362 | (371,520) | 390,848 | |||||||
Balance (shares) at Feb. 28, 2021 | 55,699,052 | ||||||||||
Balance at Feb. 29, 2020 | $ 233,022 | ||||||||||
Balance (shares) at Feb. 29, 2020 | 19,513,939 | ||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||||
Issuance of common stock in connection with acquisition | $ 1 | 456,592 | 456,593 | ||||||||
Issuance of common stock in connection with acquisition (shares) | 10,219,443 | ||||||||||
Issuance of replacement awards in connection with acquisition | 6,729 | 6,729 | |||||||||
Exercise of stock options and vesting of restricted stock units | 8,522 | 8,522 | |||||||||
Exercise of stock options and vesting of restricted stock units (shares) | 1,039,144 | ||||||||||
Purchase of capped calls | (34,503) | (34,503) | |||||||||
Issuance of common stock in connection with the employee stock purchase plan | 4,309 | 4,309 | |||||||||
Issuance of common stock in connection with the employee stock purchase plan (shares) | 140,838 | ||||||||||
Stock-based compensation expense | 72,939 | 72,939 | |||||||||
Net income (loss) | (123,124) | (123,124) | |||||||||
Contingent share earnout in connection with acquisitions | 73,481 | 73,481 | |||||||||
Balance at Feb. 28, 2022 | $ 7 | 1,350,431 | (494,644) | 855,794 | |||||||
Balance (shares) at Feb. 28, 2022 | 67,098,477 | ||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||||
Settlement of acquisition-related contingent consideration (shares) | 3,304,729 | ||||||||||
Exercise of stock options and vesting of restricted stock units | 2,071 | 2,071 | |||||||||
Exercise of stock options and vesting of restricted stock units (shares) | 2,125,524 | ||||||||||
Issuance of common stock in connection with the employee stock purchase plan | 2,927 | 2,927 | |||||||||
Issuance of common stock in connection with the employee stock purchase plan (shares) | 560,345 | ||||||||||
Stock-based compensation expense | 72,644 | 72,644 | |||||||||
Net income (loss) | (459,650) | (459,650) | |||||||||
Balance at Feb. 28, 2023 | $ 7 | $ 1,428,073 | $ (954,294) | $ 473,786 | |||||||
Balance (shares) at Feb. 28, 2023 | 73,089,075 |
Consolidated Statements of Co_2
Consolidated Statements of Convertible Preferred Stock and Stockholders Equity (Deficit) (Parenthetical) $ in Thousands | 12 Months Ended |
Feb. 28, 2021 USD ($) | |
IPO | |
Issuance costs | $ 4,596 |
Follow-on offering | |
Issuance costs | $ 600 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | ||
Feb. 28, 2023 | Feb. 28, 2022 | Feb. 28, 2021 | |
Cash flows from operating activities: | |||
Net loss | $ (459,650) | $ (123,124) | $ (50,652) |
Adjustments to reconcile net loss to net cash used in Operating activities: | |||
Goodwill impairment | 299,705 | 0 | 0 |
Depreciation and amortization expense | 46,377 | 42,608 | 8,212 |
Amortization of deferred contract acquisition costs | 3,698 | 2,945 | 1,657 |
Change in fair value of contingent consideration | (45,416) | ||
Deferred income taxes | (3,997) | (6,132) | |
Noncash interest expense | 1,660 | 1,673 | 2,252 |
Stock-based compensation expense | 72,644 | 72,939 | 9,576 |
Changes in operating assets and liabilities, net of effect of acquisitions: | |||
Accounts receivable and unbilled revenue | 4,106 | (11,829) | (10,648) |
Accounts payable and accrued expenses | 1,131 | (1,899) | 2,991 |
Deferred contract acquisition costs | (7,314) | (4,148) | (4,690) |
Deferred revenue and due to customers | 3,634 | 13,986 | (2,700) |
Accrued compensation | 157 | (2,519) | 16,356 |
Deferred rent and other liabilities | 1,627 | (106) | (505) |
Other assets | (4,483) | (1,328) | 2,919 |
Net cash used in operating activities | (40,705) | (62,350) | (25,232) |
Cash flows from investing activities: | |||
Capitalized software development costs | (5,123) | (1,096) | (374) |
Purchases of property and equipment | (2,105) | (2,521) | (1,991) |
Purchase of marketable securities | (99,998) | ||
Sale of marketable securities | 99,998 | ||
Cash paid for acquisition, net of cash acquired | (259,996) | ||
Earnout payments to MD Insider | (58) | ||
Net cash used in investing activities | (7,228) | (263,613) | (2,423) |
Cash flows from financing activities: | |||
Proceeds from employee stock purchase plan | 2,927 | 4,703 | 2,379 |
Proceeds from stock option exercises | 2,064 | 8,600 | 9,348 |
Payment of contingent consideration for acquisition | (1,828) | ||
Payments of equity issuance costs | (60) | ||
Payment of debt issuance costs | (8,368) | ||
Payment for purchase of capped calls | (34,443) | ||
Proceeds from borrowings on debt | 287,500 | 51,166 | |
Proceeds from public offerings, net of underwriters' discounts and commissions and offering costs | 439,410 | ||
Repayments of debt principal | (73,166) | ||
Payments related to debt retirement | (753) | ||
Net cash provided by financing activities | 3,163 | 257,932 | 428,384 |
Net increase (decrease) in cash and cash equivalents | (44,770) | (68,031) | 400,729 |
Cash and cash equivalents, beginning of period | 365,853 | 433,884 | 33,155 |
Cash and cash equivalents, end of period | 321,083 | 365,853 | 433,884 |
Supplemental cash flow information: | |||
Interest paid | 1,640 | 930 | 2,296 |
Fixed assets included in accounts payable | 771 | 161 | 232 |
Other receivable related to stock option exercises | 13 | 4 | 97 |
Income taxes paid | $ 157 | 122 | 149 |
Common stock issued in connection with acquisitions | 455,586 | $ 156 | |
Replacement awards issued in connection with acquisitions | $ 6,729 |
Background
Background | 12 Months Ended |
Feb. 28, 2023 | |
Background | |
Background | (1) Background (a) Business Accolade, Inc. (Accolade or together with its subsidiaries, the Company) provides personalized, technology-enabled solutions that help people better understand, navigate, and utilize the healthcare system and their workplace benefits. The Company’s customers are primarily employers that contract with Accolade to provide their employees and their employees’ families (the members) a single place to turn for their health, healthcare, and benefits needs. The Company also offers expert medical opinion services to commercial customers (which includes employers, health plans, and governmental entities) and virtual primary care, both directly to consumers and to commercial customers. These services are designed to drive better healthcare outcomes and increased satisfaction for the participants while lowering costs for the payor. The Company provides its services to customers throughout the United States. Accolade is co-headquartered in Seattle, Washington and Plymouth Meeting, Pennsylvania. (b) Liquidity The Company has incurred net losses and cumulative negative cash flows from operations since inception. To date, the Company’s operations have been funded by capital raised from investors, debt facilities, and revenues in the normal course of business. Management believes that the Company’s cash and cash equivalents, plus customer revenues and advances and available borrowings under its debt facility, are sufficient to fund its operations through at least the next 12 months from the issuance of these consolidated financial statements. Additional financing may be required for the Company to successfully implement its long-term strategy. There can be no assurance that additional financing, if needed, can be obtained on terms acceptable to the Company. (c) Initial Public Offering On July 7, 2020, the Company closed its initial public offering of common stock (IPO) in which the Company issued and sold 11,526,134 shares (inclusive of the underwriters’ over-allotment option to purchase 1,503,408 shares) of common stock at $22.00 per share. The Company received net proceeds of $231,228 after deducting underwriting discounts and commissions, as well as offering costs of $4,596 . Upon the closing of the IPO, all shares of outstanding convertible preferred stock converted into (d) Follow-on Public Offering On October 26, 2020, the Company closed a follow-on public offering of common stock in which the Company issued and sold 5,750,000 shares (inclusive of the underwriters’ over-allotment option to purchase 750,000 shares) of common stock at $38.50 per share. The Company received net proceeds of $208,046 after deducting underwriting discounts and commissions, as well as offering costs of $600, all of which were paid as of February 28, 2021. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Feb. 28, 2023 | |
Basis of Presentation and Summary of Significant Accounting Policies. | |
Summary of Significant Accounting Policies | (2) Summary of Significant Accounting Policies (a) Basis of Presentation and Principles of Consolidation Accolade’s consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (U.S. GAAP) and include the Company’s accounts and those of the Company’s wholly owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. Through the acquisition of PlushCare, Inc. (PlushCare), the Company has various administrative service agreements (ASA) with professional medical corporations established in California, Illinois, Wyoming, and New Jersey (PC). The PCs employ or contract with medical providers who provide services via the Company’s technology platform. The ASAs are evergreen and are terminable by the parties for breach or bankruptcy. Through the ASAs, the Company provides non-clinical administrative services to the PCs and manages the economic activities that most significantly affect PCs. The PCs retain control over the provision of medical services and the PC’s clinical personnel. The PCs are variable interest entities (VIE) to the Company. Under Accounting Standards Codification Subtopic 810 – Consolidation The PCs and the Company are independent entities, and as such creditors of the PCs do not have recourse against the Company in the event of default by the PCs. Additionally, the PCs’ non-cash assets are available to the Company to satisfy obligations or for other corporate purposes. (b) Use of Estimates The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, including the fair value of assets acquired and liabilities assumed for business combinations, unbilled revenues and deferred revenues, certain accrued expenses, stock-based compensation, assessment of the useful life and recoverability of long-lived assets, income taxes, disclosure of contingent assets and liabilities at the date of the consolidated financial statements, assessment of the recoverability of goodwill, and the reported amounts of revenues and expenses during the reporting period. To the extent there are material differences between these estimates, judgments, or assumptions and actual results, the Company’s financial statements will be affected. (c) Comprehensive Loss For the fiscal years ended February 28, 2023, 2022, and 2021, there was no difference between comprehensive loss and net loss. (d) Fair Value of Financial Instruments The carrying value of the Company’s financial instruments, including cash equivalents, accounts receivable, unbilled revenue, other current assets, accounts payable, and accrued expenses approximates fair value due to the short-term nature of those instruments. The Company measures financial assets and liabilities at fair value at each reporting period using a fair value hierarchy that requires the use of observable inputs and minimizes the use of unobservable inputs. The Company defines fair value as the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Fair value is estimated by applying the following hierarchy, which prioritizes the inputs used to measure fair value into three levels and bases the categorization within the hierarchy upon the lowest level of input that is available and significant to the fair value measurement: ● Level 1 — Quoted prices in active markets for identical assets or liabilities. ● Level 2 — Observable inputs other than quoted prices in active markets for identical assets and liabilities, quoted prices for identical or similar assets or liabilities in inactive markets, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. ● Level 3 — Inputs that are generally unobservable and typically reflect the Company’s estimate of assumptions that market participants would use in pricing the asset or liability. (e) Cash and Cash Equivalents Cash and cash equivalents is comprised of cash in banks and highly liquid investments, including U.S. treasury bills purchased with an original maturity of three months or less. Cash equivalents consist of investments in money market funds for which the carrying amount approximates fair value, due to the short maturities of these instruments. (f) Marketable Securities The Company classifies its marketable securities as available-for-sale, which include U.S. treasury bills with original maturities of greater than three months. These securities are carried at fair market value. There were no purchases or sales of marketable securities during the year ended February 28, 2023. The total unrecognized gain related to the marketable securities was inconsequential during the year ended February 28, 2022. (g) Accounts Receivable and Unbilled Revenue Accounts receivable are recorded at the invoiced amount and do not bear interest. The Company does not have any off-balance-sheet credit exposure related to its customers. The Company records unbilled revenue for services performed on contracts for amounts not yet billed to customers. (h) Property and Equipment Property and equipment are recorded at cost. Property and equipment are depreciated on a straight-line basis over their estimated useful lives. Useful lives for property and equipment are as follows: Property and Equipment Estimated Useful Life Office equipment and furniture 7 years Computer equipment 3 - 5 years Computer software 3 - 5 years Leasehold improvements Lesser of estimated useful life or remaining lease term (i) Capitalized Internal-Use Software Costs Costs related to software acquired, developed, or modified solely to meet the Company’s internal requirements, including tools that enable the Company’s employees to interact with members and their providers, with no substantive plans to market such software at the time of development, are capitalized. Costs incurred during the preliminary planning and evaluation stage of the project and during the post-implementation operational stage are expensed as incurred. Costs related to minor upgrades, minor enhancements, and maintenance activities are expensed as incurred. Costs incurred during the application development stage of the project are capitalized. Internal-use software is included in property and equipment and is amortized on a straight-line basis over 3 years. For the fiscal years ended February 28, 2023, 2022, and 2021, the Company capitalized $5,709, $1,096, and $374, respectively, for internal-use software. Amortization expense related to capitalized internal-use software during the fiscal years ended February 28, 2023, 2022, and 2021 was $1,196, $2,387, and $4,560, respectively. (j) Impairment of Long-Lived Assets The Company reviews long-lived assets, such as property and equipment and finite-lived intangibles, for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to estimated undiscounted future cash flows expected to be generated by the asset. If the carrying amount of an asset exceeds its estimated undiscounted future cash flows, then an impairment charge is recognized for the amount by which the carrying value of the asset exceeds the fair value of the asset. There were no long-lived asset impairment charges recorded during the fiscal years ended February 28, 2023, 2022, and 2021. (k) Intangible Assets The Company has acquired intangible assets through various acquisitions. Intangible assets are recorded at fair value on the date of acquisition and are subject to amortization over the estimated useful lives of each asset. Estimates of fair value and useful lives are based on historical factors, current circumstances, and the experience and judgment of management. Estimates and assumptions used to value intangible assets are evaluated by management on an ongoing basis. (l) Goodwill Goodwill is the excess of the cost of an acquired entity over the net amounts assigned to tangible and intangible assets acquired and liabilities assumed. Goodwill is not amortized, but is subject to evaluations of its recoverability annually and upon the identification of a triggering event. The Company has a single reporting unit and all goodwill relates to that reporting unit. The Company performs an impairment analysis of goodwill on an annual basis in the fourth quarter of each fiscal year or more frequently if changes in circumstances or the occurrence of events suggest that an impairment exists. If the fair value of the reporting unit is less than its carrying value, an impairment loss is recorded. A goodwill impairment loss was recorded during the first quarter of fiscal 2023. See Note 5 for further information. The Company did (m) Revenue and Deferred Revenue Revenue Recognition The Company generates revenue by providing customers access to its advocacy, expert medical opinion, and virtual primary care services, as well as through utilization of its expert medical opinion and virtual primary care services. Contracts with customers that include expert medical opinion or virtual primary care services may contain either an access fee, a utilization-based fee, or both. In accordance with Accounting Standards Codification (ASC) 606, Revenue from Contracts with Customers ● identification of the contract, or contracts with a customer; ● identification of the performance obligations in the contract; ● determination of the transaction price; ● allocation of the transaction price to the performance obligations in the contracts; and ● recognition of revenue when, or as, the Company satisfies a performance obligation. At contract inception, the Company assesses the type of services being provided and assesses the performance obligations in the contract. The transaction price is allocated to the separate performance obligations on a relative standalone selling price basis. The Company determines the standalone selling prices based on overall pricing objectives, taking into consideration market conditions and other factors, using an expected cost plus margin approach. The Company considered the variable consideration allocation exception in ASC 606 for its advocacy contracts and concluded that such exception for allocating variable consideration to distinct performance obligations or distinct time periods within a series was not met primarily due to variability in its per-member-per-month (PMPM) pricing. The majority of fees earned by the Company are considered to be variable consideration due to both the uncertainty regarding the total number of members, consultations or visits for which the Company will invoice the customer, as well as the variable PMPM fees that are dependent upon the achievement of performance metrics and/or healthcare cost savings. Performance metrics are measured monthly, quarterly, or annually, and with respect to the achievement of healthcare cost savings targets, annually (typically measured on a calendar year basis). Accordingly, at contract inception and on an ongoing basis, as part of the Company’s estimate of the transaction price, the Company determines whether any such fees should be constrained, and the Company includes the estimated consideration for those fees to the extent that it is probable that a significant reversal of cumulative revenue recognized will not occur (and is therefore considered to be unconstrained). Consideration related to the Company’s achievement of healthcare cost savings is typically constrained until the end of the applicable calendar year due to uncertainty related to factors outside of the Company’s control. Consideration related to other performance metrics is typically not constrained based on the Company’s prior success of achieving such metrics. On an ongoing basis, the Company reassesses its estimates for variable consideration, which can change based upon its assessment of the achievement of performance metrics and healthcare cost savings, as well as the number of members, consultations, or visits. Access Fees The Company generates revenue primarily from contracts with customers to access the Company’s advocacy, expert medical opinion, and virtual primary care services. The Company prices access fees primarily using a recurring PMPM fee, typically with a portion of the fee calculated as the product of a fixed rate times the number of members (fixed PMPM fee), plus a variable PMPM fee calculated as the product of a variable rate times the number of members (variable PMPM fee). The fees associated with the variable PMPM fee can be earned through the achievement of performance metrics and/or the realization of healthcare cost savings resulting from use of the Company’s services. Collectively, the fixed PMPM fee and variable PMPM fee are referred to as the total PMPM fee. The Company’s PMPM pricing varies by contract. In certain contracts, the maximum total PMPM fee varies during the contract term (total PMPM rate increases or decreases annually), while in other contracts, the total PMPM maximum fee is consistent over the term, yet the fixed and variable portions vary. For example, in certain contracts the fixed PMPM fee increases on an annual basis while the variable PMPM fee decreases on an annual basis, resulting in the same total PMPM fee throughout the term of the contract. The PMPM fees for expert medical opinion and virtual primary care services may be tiered based upon the customer’s utilization. Access to the Company’s services represent a single stand-ready performance obligation. The Company’s contracts include stand-ready services to provide eligible participants with access to the Company’s services and to perform an unspecified quantity of interactions with members during the contract period. Accordingly, the Company’s services are generally viewed as stand-ready performance obligations comprised of a series of distinct daily services that are substantially the same and have the same pattern of transfer. For advocacy services, the Company satisfies these performance obligations over time and recognizes revenue related to its services as the services are provided using a measure of progress based upon the actual number of members eligible for the service during the respective period as a percentage of the estimated members expected to be eligible for the service over the term of the contract. The Company believes a measure of progress based on the number of members is the most appropriate measurement of control of the services being transferred to the customer as the amount of internal resources necessary to stand-ready is directly correlated to the number of members who can use the services. For the majority of expert medical opinion services, the Company satisfies these performance obligations over time and recognizes revenue in the amount of consideration for which it has the right to invoice using the as-invoiced practical expedient. Access fees also include access to the Company’s virtual primary care services sold directly to consumers on a monthly or yearly fixed fee subscription basis. For these services, the Company satisfies these stand-ready performance obligations over time and recognizes revenue ratably over the subscription period. Utilization-based fees The Company also generates revenue when members utilize the expert medical opinion and virtual primary care services that are billed based on utilization. Many, but not all, contracts with customers contain utilization-based fees. For any utilization-based fees, the Company satisfies these performance obligations over time and recognizes revenue in the amount of consideration for which it has the right to invoice using the as-invoiced practical expedient for any consultations or visits sold to commercial customers as well as any non-insured consultations or visits related to virtual primary care services sold directly to consumers. For any consultations or visits that are paid through insurance claims, the Company recognizes revenue as the consultations and visits occur in an amount that reflects the consideration that is expected based upon then-current prices and historical experience from insurance payors. Deferred Revenue The Company typically invoices its customers in advance of the services performed on a monthly or quarterly basis, and the amount invoiced typically represents the maximum total PMPM fee for the estimated number of eligible members over the applicable invoice period. The total PMPM fee covers the stand-ready services in the Company’s typical contracts (i.e., the performance obligations are not separately priced or invoiced). The maximum total PMPM fee that is invoiced includes both the fixed PMPM fee and the variable PMPM fee related to the performance metrics and/or the realization of healthcare cost savings that can be achieved during the period. These fees are classified as deferred revenue on the Company’s consolidated balance sheet until such time that revenue can be recognized. In the event the Company fails to satisfy any of the performance metrics and/or realization of healthcare cost savings that are billed in advance, the Company will refund the applicable portion of the fee or offset the amount against a future invoice. These amounts are included in due to customers on the Company’s consolidated balance sheet. The Company’s accounts receivable represent rights to consideration that are unconditional. (n) Concentration of Credit Risk Financial instruments that potentially subject the Company to credit risk consist principally of cash, cash equivalents, and marketable securities. The Company maintains its cash primarily with domestic financial institutions of high credit quality, which may exceed federal deposit insurance corporation limits. The Company invests its cash equivalents in highly rated money market funds and U.S. treasury bills with original maturities of three months or less. Marketable securities are comprised of U.S. treasury bills with original maturities greater than three months. The Company has not experienced any losses in such accounts. The Company believes it is not exposed to any significant credit risk on cash, cash equivalents, and marketable securities and performs periodic evaluations of the credit standing of such institutions. Significant customers are those which represent 10% or more of the Company’s revenue during the period. For each significant customer, revenue as a percentage of total revenue was as follows: Year Ended February 28, 2023 2022 2021 Customer 1 * % * % 16.0 % Customer 2 * % * % 11.8 % Customer 3 * % * % 10.2 % Customer 4 * % * % 9.8 % Total * % * % 47.8 % *For the fiscal years ended February 28, 2023 and 2022, no customer represented 10% or more of the Company’s revenue. (o) Stock-Based Compensation The Company recognizes compensation cost for awards to employees, nonemployee directors, consultants, and advisors based on the grant date fair value of stock-based awards on a straight-line basis over the period during which an award holder is required to provide service in exchange for the award. The Company estimates the fair value of each employee stock option on the date of grant using the Black-Scholes option pricing model. (p) Cost of Revenue, excluding Depreciation and Amortization Cost of revenue, excluding depreciation and amortization, consists primarily of personnel costs including salaries, wages, overtime, bonuses, stock-based compensation expense, and benefits, as well as software and tools for telephony, business analytics, allocated overhead costs, and other expenses related to delivery and implementation of the Company’s personalized technology-enabled solutions. (q) Product and Technology Product and technology expenses consist of personnel expenses, including salaries, bonuses, stock-based compensation expense, and benefits for employees and contractors for engineering, product, and design teams, and allocated overhead costs, as well as costs of software and tools for business analytics, data management, and IT applications that are not directly associated with delivery of the Company’s solutions to customers. (r) Income Taxes The provision for income taxes was determined using the asset and liability approach of accounting for income taxes. Under this approach, deferred taxes represent the future tax consequences expected to occur when the reported amounts of assets and liabilities are recovered or paid. The provision for income taxes represents income taxes paid or payable for the current year plus the change in deferred taxes during the period. Deferred taxes result from differences between the financial and tax basis of the Company’s assets and liabilities and are adjusted for changes in tax rates and tax laws when changes are enacted. Valuation allowances are recorded to reduce deferred tax assets when it is more likely than not that a tax benefit will not be realized. Deferred tax assets and liabilities are measured using enacted tax rates applicable in the years in which they are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax law is recognized in income in the period that includes the enactment date. In evaluating the ability to realize deferred tax assets, the Company relies on taxable income in prior carryback years, the future reversals of existing taxable temporary differences, future taxable income, and tax planning strategies. Consistent with the provisions of FASB ASC Topic 740, Income Taxes (s) Segments The Company’s chief operating decision maker, its Chief Executive Officer, reviews the financial information presented on a consolidated basis for purposes of allocating resources and evaluating its financial performance. Accordingly, the Company has determined that it operates in a single reportable segment. As of February 28, 2023, 2022, and 2021, substantially all of Accolade’s long-lived assets were located in the United States, and all revenue was earned in the United States. (t) Leases Whenever the Company enters into a new arrangement, it determines, at the inception date, whether the arrangement is or contains a lease. This determination generally depends on whether the arrangement conveys to the Company the right to control the use of an explicitly or implicitly identified asset for a period of time in exchange for consideration. Control of an underlying asset is conveyed to the Company if the Company obtains the right to direct the use of, and obtain substantially all the economic benefits from, the use of the underlying asset. If a lease exists, the Company then determines the separate lease and non-lease components of the arrangement. Each right to use an underlying asset conveyed by a lease arrangement should generally be considered a separate lease component if it both: (i) can benefit the Company without depending on other resources not readily available to the Company and (ii) does not significantly affect, and is not significantly affected by, other rights of use conveyed by the lease. Aspects of a lease arrangement that transfer other goods or services to the Company but do not meet the definition of lease components are considered non-lease components. The consideration owed by the Company pursuant to a lease arrangement is generally allocated to each lease and non-lease component for accounting purposes. However, the Company has elected, for all of its leases, to not separate lease and non-lease components. For each lease, the Company then determines the lease term, the present value of lease payments, and the classification of the lease as either an operating or finance lease. The lease term is the period of the lease not cancellable by the Company, together with periods covered by: (i) renewal options the Company is reasonably certain to exercise, (ii) termination options the Company is reasonably certain not to exercise, and (iii) renewal or termination options that are controlled by the lessor. The present value of lease payments is calculated based on: (1) Lease payments – Lease payments included in the measurement of the lease asset or liability comprise the following: fixed payments (including in-substance fixed payments), and the exercise price of a lessee option to purchase the underlying asset if the lessee is reasonably certain to exercise. (2) Discount rate – the discount rate is determined based on information available to the Company upon the commencement of the lease. Lessees are required to use the rate implicit in the lease whenever such rate is readily available; however, as the implicit rate in the Company’s leases is generally not readily determinable, the Company generally uses the incremental borrowing rate it would have to pay to borrow an amount equal to the lease payments, on a collateralized basis, over a timeframe similar to the lease term. In making the determination of whether a lease is an operating lease or a finance lease, the Company considers the lease term in relation to the economic life of the leased asset, the present value of lease payments in relation to the fair value of the leased asset and certain other factors, including the lessee’s and lessor’s rights, obligations, and economic incentives over the term of the lease. The Company does not recognize leases with an initial term of 12 months or less on its consolidated balance sheets and recognizes these payments in the consolidated statements of operations on a straight-line basis over the lease term. Certain leases contain variable payments which are based on usage or operating costs, such as utilities and maintenance. These payments are not included in the measurement of the lease liability or corresponding right-of-use asset due to the uncertainty of the payment amount and are recorded as lease expense in the period incurred. (u) Recently Issued Accounting Pronouncements In June 2022, the FASB issued ASU 2022-03, Fair Value Measurement (Topic 820): Fair Value Measurement of Equity Securities Subject to Contractual Sale Restrictions certain disclosures for equity securities subject to contractual sale restrictions that are measured at fair value in accordance with Topic 820. This guidance is effective for annual reporting periods, including interim periods, beginning after December 15, 2023, with early adoption permitted. The provisions of ASU 2022-03 are to be applied prospectively with any adjustments made to earnings on the date of adoption. The Company is currently evaluating the impact, if any, of this guidance on its financial statements. |
Revenue
Revenue | 12 Months Ended |
Feb. 28, 2023 | |
Revenue | |
Revenue | (3) Revenue The following table presents the Company’s revenues disaggregated by revenue source: Year Ended February 28, 2023 2022 Access fees $ 284,144 $ 264,612 Utilization-based fees 78,998 45,409 Total $ 363,142 $ 310,021 As of February 28, 2023, revenue is expected to be recognized from remaining performance obligations as follows: Year Ending February 28(29), 2024 $ 152,976 2025 56,778 2026 14,888 2027 372 2028 34 Total $ 225,048 The expected revenue includes variable fee estimates for the non-cancellable term of the Company’s contracts. The expected revenue does not include amounts of variable consideration that are constrained. Significant changes to the contract liability balances during the fiscal years ended February 28, 2023 and 2022 were the result of revenue recognized and net cash received. During the fiscal years ended February 28, 2023 and 2022, significant changes in the deferred revenue balances were the result of recognized revenue of $30,567 and $25,817, respectively, that were included in deferred revenue. In addition, significant changes to the contract asset balances during the fiscal years ended February 28, 2023 and 2022 were the result of revenue recognized and transfers to accounts receivable. Contract assets relating to unbilled revenue are transferred to accounts receivable when the right to consideration becomes unconditional. Revenue related to performance obligations satisfied in prior periods that was recognized during the years ended February 28, 2023 and 2022 was $3,768 and $4,673, respectively. These changes in amounts were primarily due to the inclusion of consideration that was previously constrained related to the Company’s achievement of healthcare cost savings. Cost to obtain and fulfill a contract The Company capitalizes sales commissions paid to internal sales personnel that are both incremental to the acquisition of customer contracts and recoverable. These costs are recorded as deferred contract acquisition costs in the accompanying consolidated balance sheets. The Company capitalized commission costs of $6,016 and $3,478 for the years ended February 28, 2023 and 2022, respectively. During the year ended February 28, 2022, the Company wrote off previously deferred commissions of $484 related to a revision of the Company’s commission plan, which offset the amounts capitalized during the year ended February 28, 2022. The Company defers costs based on its sales compensation plans only if the commissions are incremental and would not have occurred absent the customer contract. Payments to direct sales personnel are typically made upon signature of the contract. The Company does not pay commissions on contract renewals. Deferred commissions paid on the initial acquisition of a contract are amortized ratably over an estimated period of benefit of five years, which is the estimated customer life. The Company determined the period of amortization for deferred commissions by taking into consideration current customer contract terms, historical customer retention, and other factors. Amortization is included in sales and marketing expenses in the accompanying consolidated statements of operations and totaled $2,695, $2,080, and $1,106 for the fiscal years ended February 28, 2023, 2022, and 2021, respectively. The Company periodically reviews deferred contract acquisition costs to determine whether events or changes in circumstances have occurred that could impact the estimated period of benefit. There were no impairment losses recorded during the periods presented. For certain customer contracts, the Company may incur direct and incremental costs related to customer set-up and implementation. The Company recorded deferred implementation costs of $1,303 and $1,154 for the fiscal years ended February 28, 2023 and 2022, respectively. These implementation costs are deferred and amortized over the expected useful life of the Company’s customers, which is five years. Amortization is included in cost of revenues in the Company’s consolidated statements of operations and totaled $1,002, $865, and $551 for the fiscal years ended February 28, 2023, 2022, and 2021, respectively. |
Acquisitions
Acquisitions | 12 Months Ended |
Feb. 28, 2023 | |
Acquisitions | |
Acquisitions | (4) Acquisitions Acquisition of 2nd.MD On March 3, 2021, the Company acquired all the outstanding equity interests of Innovation Specialists LLC d/b/a 2nd.MD (2nd.MD). Based in Houston, Texas, 2nd.MD is a leading expert medical opinion and medical decision support company. The results of operations and financial position of 2nd.MD are included in the Company’s consolidated financial statements from the date of acquisition. The consideration paid was comprised of cash, common stock, and contingent consideration as follows: Consideration Cash consideration, net of cash acquired $ 226,135 Fair value of common stock issued 116,187 Fair value of replacement awards 1,520 Fair value of contingent consideration 76,248 Total consideration $ 420,090 The aggregate purchase consideration of $420,090 was provided through cash of $226,135 (net of $205 cash acquired) and the issuance of up to 4,384,882 shares of the Company’s common stock, of which 2,822,242 were issued upon closing of the acquisition, of which 2,495,441 were fully vested at the time of issuance with the remaining 326,801 vesting over future service periods. The cash consideration in the above table includes the repayment of of $13,026 . The contingent consideration represented potential obligations for the Company to issue up to 2,170,972 additional shares of its common stock to the selling shareholders of was comprised of two earnout scenarios associated with (1) a contract renewal and (2) the achievement of certain future revenue milestones. As a result of the contract renewal and achievement of certain revenue milestones, the Company issued a total of 1,977,321 shares of its common stock during the year ended February 28, 2023. The estimated fair value of the replacement awards issued in the above table is comprised of 120,760 restricted stock units issued to 2nd.MD employees with an estimated fair value of $5,434 of which $1,520 was attributable to pre-acquisition services. The remaining estimated value of $3,914 associated with the replacement awards is attributable to post-acquisition services and is being expensed over the requisite service periods of the awards. Several key 2nd.MD employees entered into agreements with the Company whereby their pro rata portion of shares issued at closing and upon achievement of the contingent consideration milestones are also subject to continuous employment with the Company and vest annually over a period of two years following the acquisition date. Upon voluntary termination of employment, any unvested shares will be forfeited. Due to the risk of forfeiture upon termination of employment, the aggregate 326,801 shares issued at closing and the aggregate shares eligible to be issued upon achievement of the contingent consideration milestones of 281,531 shares were excluded from the purchase price and contingent consideration. These shares are accounted for as stock-based compensation expense in the post business combination periods. The estimated fair value of the contingent consideration associated with future revenue milestones was determined using a Monte Carlo simulation. The Monte Carlo simulation performs numerous simulations utilizing certain assumptions such as (i) projected eligible revenues, (ii) expected term, (iii) risk-free rate, (iv) risk-adjusted discount rate, (v) share volatility and (vi) operational leverage ratio between revenues and earnings before interest, taxes, depreciation and amortization (EBITDA). The Company accounted for the acquisition of 2nd.MD under the U.S. GAAP business combinations guidance. This accounting requires that assets acquired and liabilities assumed be recognized at their fair values as of the acquisition date. The allocation of the purchase price to the assets acquired and liabilities assumed was subject to further adjustment within the measurement period (up to one year from the acquisition date). Measurement period adjustments since initial preliminary estimates reported in the first quarter of fiscal 2022 were primarily related to an updated working capital calculation. The cumulative effect of all measurement period adjustments resulted in a decrease to recognized goodwill of $1,878 . As of February 28, 2022, the purchase price allocation was considered complete. The following table summarizes the fair values of the assets acquired and liabilities assumed at the date of acquisition. Assets acquired: Accounts receivable $ 5,550 Unbilled revenue 226 Current portion of deferred contract acquisition costs 176 Prepaid and other current assets 1,052 Property and equipment 4,344 Deferred contract acquisition costs 564 Goodwill 208,286 Intangible assets (1) Customer relationships 120,000 Technology 58,000 Supplier-based network 25,000 Trade name 3,400 Non-compete agreement 3,100 Total assets acquired $ 429,698 Liabilities assumed: Accounts payable $ 1,195 Accrued expenses 585 Accrued compensation 3,817 Deferred rent and other current liabilities 904 Due to customers 294 Current portion of deferred revenue 625 Deferred rent and other noncurrent liabilities 2,188 Total liabilities assumed $ 9,608 Net assets acquired $ 420,090 (1) The weighted-average useful life of intangible assets acquired is approximately 14 years . The purchase price was allocated to the tangible and identifiable intangible assets acquired and liabilities assumed based on their estimated fair values at the acquisition date. The identifiable intangible assets included and are being amortized on a straight-line basis ranging from 3 years to 20 years . The technology intangible asset was valued using the estimated replacement cost method. This method requires several judgments and assumptions to determine the fair value, including expected profits and opportunity cost. Goodwill is attributable to the workforce of 2nd.MD as well as expected future growth into new and existing markets and is deductible for income tax purposes. For the fiscal year ended February 28, 2022, 2nd.MD contributed approximately $48,753 of revenue and approximately $(32,353) of net loss, which includes $27,211 to the Company’s operating results. Acquisition of PlushCare On June 9, 2021, the Company acquired all the outstanding equity interests of PlushCare. Based in San Francisco, California, PlushCare is a provider of various technology and administrative services to the medical practice PCs, which in turn provide virtual primary care services. The results of operations and financial position of PlushCare are included in the Company’s consolidated financial statements from the date of acquisition. The consideration paid was comprised of cash, common stock, and contingent consideration as follows: Consideration Fair value of common stock issued $ 330,338 Fair value of contingent consideration 44,618 Cash consideration, net of cash acquired 33,860 Fair value of replacement awards 5,209 Total consideration $ 414,025 The aggregate purchase consideration of $414,025 was provided through cash of $33,860 (net of $17,837 cash acquired and $1,463 of debt repaid) and the issuance of 7,144,393 shares of the Company’s common stock, of which 854,717 are subject to future vesting and excluded from consideration paid. The contingent consideration represented a potential obligation for the Company to issue up to an additional 1,429,556 shares of its common stock and up to approximately $2,000 in cash upon the achievement of defined revenue milestones following the closing, of which $1,828 was paid during fiscal 2023. Up to 102,111 shares of this contingent consideration will be withheld from being issued to the selling shareholders of PlushCare until the resolution of a pending litigation matter. The revenue milestone contingency was resolved at December 31, 2021, and as a result the Company issued 1,327,408 shares of its common stock during fiscal 2023, excluding the 102,111 shares that are withheld pending the resolution of the litigation matter. See Note 16 for further details. The estimated fair value of the replacement awards issued in the above table is comprised of 325,992 options to purchase Accolade common stock issued to PlushCare employees as of the acquisition date with an estimated fair value of $16,663 , of which $5,209 was attributable to pre-acquisition services. The remaining estimated value of $11,454 associated with the replacement awards is attributable to post-acquisition services and is being expensed over the requisite service periods of the awards. Certain key PlushCare employees entered into agreements with the Company whereby a portion of their shares issued at closing are subject to continuous employment with the Company and vest annually over a three-year period following the acquisition date. Upon voluntary termination of employment, any unvested shares will be forfeited. Due to the risk of forfeiture upon termination of employment, the 806,161 shares subject to forfeiture have been excluded from the purchase price and are accounted for as stock-based compensation expense in the post-business combination periods. The estimated fair value of the contingent consideration associated with future revenue milestones was determined using a Monte Carlo simulation. The Monte Carlo simulation performs numerous simulations utilizing certain assumptions such as (i) projected eligible revenues, (ii) expected term, (iii) risk-free rate, (iv) risk-adjusted discount rate, (v) share volatility, and (vi) operational leverage ratio between revenues and earnings before interest, taxes, depreciation, and amortization (EBITDA). The estimated fair value of the contingent consideration was $37,683 as of December 31, 2021 at which time the contingency was resolved. The estimated fair value of contingent consideration decreased since the acquisition date primarily due to a decrease in the Company’s stock price. The Company recorded the change in fair value of its contingent consideration liability in the consolidated statements of operations through December 31, 2021. Upon resolution of the contingency and determination of the number of common stock shares to be issued, the Company reclassified the value of the contingent consideration from a liability into stockholders’ equity as of February 28, 2022 in the consolidated balance sheet. The Company accounted for the acquisition of PlushCare under the U.S. GAAP business combinations guidance. This accounting requires that assets acquired and liabilities assumed be recognized at their fair values as of the acquisition date. The allocation of the purchase price to the assets acquired and liabilities assumed was subject to further adjustment within the measurement period (up to one year from the acquisition date). Measurement period adjustments since initial preliminary estimates reported in the second quarter of fiscal 2022 were primarily related to updated assessments of acquired deferred tax liability and accounts receivable. The cumulative effect of all measurement period adjustments resulted in a decrease to recognized goodwill of $1,685 . As of May 31, 2022, the purchase price allocation was considered complete. The following table summarizes the estimated fair values of the assets acquired and liabilities assumed at the date of acquisition. Assets acquired: Accounts receivable $ 1,359 Prepaid and other current assets 573 Property and equipment 298 Other noncurrent assets 932 Goodwill 365,597 Intangible assets (1) Customer relationships 4,050 Technology 40,650 Trade name 10,300 Non-compete agreements 6,200 Total assets acquired $ 429,959 Liabilities assumed: Accounts payable $ 1,532 Accrued expenses 193 Accrued compensation 2,117 Current portion of deferred revenue 1,212 Deferred tax liability 9,992 Other liabilities 888 Total liabilities assumed $ 15,934 Net assets acquired $ 414,025 (1) The weighted-average useful life of intangible assets acquired is approximately 5 years . The purchase price was allocated to the tangible and identifiable intangible assets acquired and liabilities assumed based on their estimated fair values at the acquisition date. The identifiable intangible assets included and are being amortized on a straight-line basis ranging from 2 years to 10 years . value of intangible assets, including growth rates, discount rates, customer attrition rates, expected levels of cash flows, and tax rate. Key assumptions used included revenue projections for fiscal years 2022 through 2035, an attrition rate of 25% and 50%, a tax rate of 25%, a discount rate of 12.5%, a royalty rate of 3% and probabilities of competition between 70% and 90%. The technology intangible asset was valued using the estimated replacement cost method. This method requires several judgments and assumptions to determine the fair value, including expected profits and opportunity cost. Goodwill is attributable to the workforce of PlushCare as well as expected future growth into new and existing markets and is not deductible for income tax purposes. For the year ended February 28, 2022, PlushCare contributed approximately $44,393 of revenue and approximately $(15,396) of net loss, which includes $ of equity-based compensation expense related to PlushCare employees, to the Company’s operating results. Unaudited Pro Forma Financial Information The following table reflects the pro forma operating results for the Company which gives effect to the acquisitions of 2nd.MD and PlushCare as if they had occurred on March 1, 2020. The pro forma results are based on assumptions that the Company believes are reasonable under the circumstances. The pro forma results are not necessarily indicative of future results. The pro forma financial information includes the historical results of the Company, 2nd.MD, and PlushCare adjusted for certain items, which are described below, and does not include the effects of any synergies or cost reduction initiatives related to the acquisitions of 2nd.MD or PlushCare. Unaudited Pro Forma Year ended February 28, 2022 2021 Revenue $ 324,367 $ 249,028 Net income (loss) $ (137,644) $ (142,392) Pro forma net income (loss) for the years ended February 28, 2022 and 2021 reflect adjustments primarily related to interest expense, the amortization of intangible assets and stock-based compensation expense. The unaudited pro forma financial information is not necessarily indicative of what the Company’s consolidated results actually would have been if the acquisition had been completed at the beginning of the respective periods. Acquisition of HealthReveal On September 30, 2021, the Company acquired substantially all the assets of HealthReveal, Inc. (HealthReveal). HealthReveal is a clinical artificial intelligence company focused on ensuring patients receive optimal, personalized chronic care to preempt adverse outcomes. Under the terms of the agreement, the Company issued 252,808 shares of common stock as consideration at closing. The Company also issued 28,089 additional shares of common stock subject to an indemnity holdback, and such shares were released 18 months following the closing. The Company accounted for this transaction as an asset acquisition based on an evaluation of the U.S. GAAP guidance for business combinations. The Company concluded that the developed technology acquired from HealthReveal comprised substantially all of the fair value of the gross assets acquired and that the assets acquired did not meet the definition of a business under the guidance for business combinations. The developed technology intangible asset was recorded at $9,976 on the acquisition date and is being amortized on a straight-line basis over 3 years . Acquisition and Integration-Related Costs For the year ended February 28, 2023, the Company incurred $1,218 in acquisition and integration-related costs related to litigation inherited through the PlushCare acquisition. Refer to Note 16 for further details. These costs were recorded in general and administrative expenses in the Company’s consolidated statements of operations. ended February 28, 2022 and 2021, t he Company incurred a total cquisition and integration-related costs that were expensed immediately and recorded in general and administrative expenses in the Company’s consolidated statements of operations. These costs include banking, legal, accounting, and consulting fees related to acquisitions. |
Goodwill and Intangible Assets
Goodwill and Intangible Assets | 12 Months Ended |
Feb. 28, 2023 | |
Goodwill and Intangible Assets | |
Goodwill and Intangible Assets | (5) Goodwill and Intangible Assets The changes in the carrying amount of goodwill are as follows: Balance, February 28, 2021 $ 4,013 Acquisitions 573,883 Balance, February 28, 2022 $ 577,896 Impairment (299,705) Balance, February 28, 2023 $ 278,191 Annually, and upon the identification of a triggering event, management is required to perform an evaluation of the recoverability of goodwill. Triggering events potentially warranting an interim goodwill impairment test include, among other factors, declines in historical or projected revenue, operating income or cash flows, and sustained declines in the Company’s stock price or market capitalization, considered both in absolute terms and relative to peers. As a result of sustained decreases in the Company’s stock price and market capitalization, the Company conducted an impairment test of its goodwill and intangible assets as of May 31, 2022. As a result of this testing, the Company recorded a non-cash goodwill impairment charge of $299,705 (equivalent to $4.20 per basic and diluted share for the year ended February 28, 2023 While management cannot predict if or when additional future goodwill impairments may occur, additional goodwill impairments could have material adverse effects on the Company’s operating income, net assets, and/or the Company’s cost of, or access to, capital. Intangible assets consisted of the following: As of February 28, 2023 As of February 28, 2022 Weighted Avg. Remaining Useful Life (years) Gross Value Accumulated Amortization Net Carrying Value Gross Value Accumulated Amortization Net Carrying Value Customer relationships 17.9 $ 124,050 $ (15,353) $ 108,697 $ 124,050 $ (7,444) $ 116,606 Technology 3.0 111,526 (45,046) 66,480 111,526 (21,971) 89,555 Supplier-based network 3.0 25,000 (10,000) 15,000 25,000 (5,000) 20,000 Trade name 8.2 13,700 (2,483) 11,217 13,700 (1,112) 12,588 Non-compete agreement 0.7 9,300 (7,492) 1,808 9,300 (3,359) 5,941 $ 283,576 $ (80,374) $ 203,202 $ 283,576 $ (38,886) $ 244,690 Amortization expense for intangible assets was $41,488, $36,590, and $1,450 during the years ended February 28, 2023, 2022, and 2021, respectively. Amortization expense over the remaining life of the intangible assets will be recognized as follows: Year Ending February 28(29), 2024 $ 37,795 2025 34,143 2026 32,125 2027 9,403 2028 7,370 Thereafter 82,366 203,202 |
Property and Equipment
Property and Equipment | 12 Months Ended |
Feb. 28, 2023 | |
Property and Equipment | |
Property and Equipment | (6) Property and Equipment Property and equipment consisted of the following: February 28, 2023 2022 Capitalized software development costs $ 39,097 $ 33,388 Computer software 6,026 6,023 Computer equipment 12,363 10,518 Office equipment, furniture, and leasehold improvements 12,120 11,838 69,606 61,767 Less accumulated depreciation (54,843) (49,970) Total $ 14,763 $ 11,797 Depreciation and amortization expense related to property and equipment was $4,889, $6,018, and $6,762 for the fiscal years ended February 28, 2023, 2022, and 2021, respectively. During the year ended February 28, 2022, the Company wrote off $328 of fully-depreciated computer equipment. |
Leases
Leases | 12 Months Ended |
Feb. 28, 2023 | |
Leases | |
Leases | (7) Leases The Company adopted Accounting Standards Update 2016-02, Leases The components of operating lease cost recorded in the consolidated statements of operations were as follows: Year Ended February 28, 2023 2022 Operating lease cost 7,575 $ 7,169 Variable lease cost 2,042 1,691 Total lease cost 9,617 $ 8,860 The following table sets forth the cash flows related to the Company’s leases: Year Ended February 28, Cash Flow Information 2023 2022 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 8,569 $ 8,310 Right-of-use assets obtained in exchange for lease obligations Operating leases $ 2,170 $ 3,564 The following table sets forth the weighted-average remaining term and weighted-average discount rate for the Company’s leases as of February 28, 2023: Supplemental Information February 28, 2023 Weighted-average remaining lease term (years) 5.3 Weighted-average discount rate 5.0 % As of February 28, 2023, the future minimum lease payments under non-cancelable operating leases were as follows: Year Ending February 28(29), 2024 $ 8,849 2025 7,270 2026 7,303 2027 6,420 2028 3,665 Thereafter 5,732 Total lease payments 39,239 Less: Imputed interest (4,766) Total lease liabilities $ 34,473 In the fourth quarter of fiscal 2023, the Company entered into an office lease agreement in Prague, Czech Republic that is expected to be accounted for as an operating lease. This lease is not recorded in the consolidated balance sheets or in the table above as the lease had not commenced as of February 28, 2023. The lease has total minimum fixed payments of approximately $5,700 over a term of approximately 8 years and is expected to commence in fiscal 2024. |
Accrued Expenses and Other Curr
Accrued Expenses and Other Current Liabilities | 12 Months Ended |
Feb. 28, 2023 | |
Accrued Expenses and Accrued Compensation | |
Accrued Expenses and Other Current Liabilities | (8) Accrued Expenses and Other Current Liabilities Accrued expenses and other current liabilities consisted of the following: February 28, 2023 2022 Current portion of loans payable, net of unamortized issuance cost $ 596 $ 596 Professional and consulting fees 1,992 2,661 Taxes 528 769 Marketing 347 1,492 Accrued litigation (1) 3,700 888 Software, hardware, and communication costs 464 600 Payable related to acquisition earnout — 1,969 Other 4,117 2,025 Total $ 11,744 $ 11,000 (1) See Note 16 for discussion regarding accrued litigation matters . |
Fair Value Measurements
Fair Value Measurements | 12 Months Ended |
Feb. 28, 2023 | |
Fair Value Measurements | |
Fair Value Measurements | (9) Fair Value Measurements The following table sets forth the fair value of the Company’s financial assets within the fair value hierarchy: February 28, 2023 Level 1 Level 2 Level 3 Fair Value Assets Cash equivalents: Money market funds $ 99,861 $ — $ — $ 99,861 United States treasury bills $ 39,995 $ — $ — $ 39,995 February 28, 2022 Level 1 Level 2 Level 3 Fair Value Assets Cash equivalents: Money market funds $ 131,527 $ — $ — $ 131,527 United States treasury bills $ 99,999 $ — $ — $ 99,999 In connection with the acquisitions of 2nd.MD and PlushCare, the Company recorded contingent consideration liabilities for the estimated fair value of Accolade common stock issuable to 2nd.MD and PlushCare shareholders upon the achievement of certain defined The Company recorded the change in fair value of its contingent consideration liabilities in the consolidated statements of operations. The following presents changes in the Company’s Level 3 contingent consideration liabilities for the year ended February 28, 2022: Balance, February 28, 2021 $ — Incurred through acquisition 120,866 Change in fair value (45,416) Reclassification to equity and accrued expenses and other current liabilities (75,450) Balance, February 28, 2022 $ — The estimated fair value of the convertible senior notes (Note 10) was $221,346 as of February 28, 2023, based on quoted market prices of the Company’s instrument in markets that are not active and are classified as Level 2 within the fair value hierarchy. Considerable judgment is necessary to interpret the market data and develop an estimate of the fair value. Accordingly, the estimate is not necessarily indicative of the amount at which this instrument could be purchased, sold, or settled. |
Debt
Debt | 12 Months Ended |
Feb. 28, 2023 | |
Debt | |
Debt | (10) Debt (a) Convertible Senior Notes and Capped Call Options Convertible Senior Notes In March 2021, the Company completed a private convertible note offering, pursuant to an Indenture dated as of March 29, 2021 between the Company and U.S. Bank National Association, as trustee (the Indenture), and issued $287,500 of 0.50% Convertible Senior Notes due 2026 (the Notes) that mature in April 2026, unless earlier converted, redeemed or repurchased. The Notes bear interest at a rate of 0.50% per annum, payable semiannually in arrears on April 1 and October 1 of each year, beginning on October 1, 2021 and are convertible into cash, shares of the Company’s common stock or a combination of cash and shares of common stock, at the Company’s election. The Company incurred costs of $8,428 in connection with the Notes and the capped calls, of which $8,368 was allocated to the Notes and recorded as a debt discount and $60 was allocated to the capped call and recorded directly to additional paid-in capital. Net proceeds from the issuance of Notes were $279,132, and the Company used $34,443 of the net proceeds to pay the costs of the capped call transactions described below. For the years ended February 28, 2023 and 2022, the Company recorded interest expense of $3,094 and $2,857, respectively, of which $1,657 and $1,534, respectively, was associated with the amortization of the debt discount. Pursuant to the terms of the Notes, a holder may convert all or any portion of its Notes at its option at any time prior to October 1, 2025 and only under the following circumstances: (1) during any fiscal quarter commencing after the fiscal quarter ending on August 31, 2021, if the last reported sale price of the Company’s common stock for at least 20 trading days during a period of 30 consecutive trading days ending on, and including, the last trading day of the immediately preceding fiscal quarter is greater than or equal to 130% of the conversion price on each applicable trading day; (2) during the five business day period after any ten consecutive trading day period (the “measurement period”) in which the trading price (as defined in the Indenture) per $1 principal amount of Notes for each trading day of the measurement period was less than 98% of the product of the last reported sale price of the Company’s common stock and the conversion rate on each such trading day; (3) if the Company calls such Notes for redemption, at any time prior to the close of business on the scheduled trading day immediately preceding the redemption date, but only with respect to the Notes called (or deemed called) for redemption; or (4) upon the occurrence of specified corporate events. On or after October 1, 2025 until the close of business on the second scheduled trading day immediately preceding the maturity date, holders may convert all or any portion of their Notes at any time, regardless of the foregoing circumstances. The initial conversion rate is 19.8088 shares of the Company’s common stock per $1 principal amount of Notes (equivalent to an initial conversion price of approximately $50.48 per share of the Company’s common stock). The conversion rate is subject to adjustment in some events but will not be adjusted for any accrued and unpaid interest. In addition, following certain corporate events that occur prior to the maturity date, or if the Company delivers a notice of redemption, the Company will, in certain circumstances, increase the conversion rate for a holder who elects to convert its Notes in connection with such a corporate event or convert its Notes called (or deemed called) for redemption in connection with such notice of redemption, as the case may be. The Company may not redeem the Notes prior to April 6, 2024. On or after April 6, 2024, the Company may redeem for cash all or any portion of the Notes (subject to the partial redemption limitation set forth in the Indenture), at its option, if the last reported sale price of the Company’s common stock has been at least 130% of the conversion price then in effect for at least 20 trading days, including the trading day immediately preceding the date on which the Company provides notice of redemption, during any 30 consecutive trading day period ending on, and including, the trading day immediately preceding the date on which the Company provides notice of redemption at a redemption price equal to 100% of the principal amount of the Notes to be redeemed, plus accrued and unpaid interest to, but excluding, the redemption date. No sinking fund is provided for the Notes. Upon a fundamental change (as defined in the Indenture), holders may, subject to certain exceptions, require the Company to purchase their Notes in whole or in part for cash at a price equal to the principal amount of the Notes to be purchased, plus accrued and unpaid interest, if any, to, but excluding, the fundamental change repurchase date (as defined in the Indenture). In addition, upon a Make-Whole Fundamental Change (as defined in the Indenture), the Company will, under certain circumstances, increase the applicable conversion rate for a holder that elects to convert its Notes in connection with such Make-Whole Fundamental Change. Under the Indenture, the Notes may be accelerated upon the occurrence of certain customary events of default. If certain bankruptcy and insolvency-related events of default with respect to the Company occur, the principal of, and accrued and unpaid interest on, all of the then outstanding Notes shall automatically become due and payable. The Indenture provides that the sole remedy for an event of default relating to certain failures by the Company to comply with reporting covenants, including timely filings, consists exclusively of the right to receive additional interest on the Notes. As of February 28, 2023, none of the conditions of the Notes to early convert had been met. The Notes are the Company’s senior, unsecured obligations that rank senior in right of payment to the Company’s future indebtedness that is expressly subordinated to the Notes, rank equally in right of payment with the Company’s future senior unsecured indebtedness that is not so subordinated, effectively subordinated to the Company’s existing and future secured indebtedness, to the extent of the value of the collateral securing such indebtedness, and structurally subordinated to all existing and future indebtedness and other liabilities (including trade payables and preferred equity (to the extent the Company is not a holder thereof)) of the Company’s subsidiaries. The Notes contain both affirmative and negative covenants. As of February 28, 2023, the Company was in compliance with all covenants in the Notes. The Company concluded the Notes are accounted for as debt, with no bifurcation of the embedded conversion feature. Transaction costs were recorded as a direct deduction from the related debt liability in the consolidated balance sheet and are amortized to interest expense using the effective interest method over the term of the Notes. The effective interest rate for the Notes is 1.1%. As of February 28, 2023, the Notes consisted of the following: February 28, 2023 Principal $ 287,500 Unamortized issuance costs (5,177) Net carrying amount $ 282,323 Capped Call Concurrent with the pricing of the Notes, the Company entered into privately negotiated capped call transactions with two of the initial purchasers and/or their respective affiliates and another financial institution (the Option Counterparties). The capped call transactions are expected to offset the potential dilution to Accolade’s common stock as a result of any conversion of Notes, with such offset subject to a cap initially equal to $76.20 (which represented a premium of 100% over the last reported sale price of the Company’s common stock on March 24, 2021). The capped call transactions are separate transactions, entered into by the Company with the Option Counterparties, and are not part of the terms of the Notes. As the capped call options are both legally detachable and separately exercisable from the Notes, the Company accounts for the capped call options separately from the Notes. The capped call options are indexed to the Company’s own common stock and classified in stockholders’ equity. As such, the premiums paid for the capped call options were included as a net reduction to additional paid-in capital in the consolidated balance sheet (b) Revolving Credit Facility During July 2019, the Company entered into a revolving credit facility (as amended, the 2019 Revolver) with a syndicate of two banks. Under the 2019 Revolver, the Company has the capacity to borrow up to $80,000 on a revolving facility. Availability of borrowings on the 2019 Revolver is calculated as a multiple of the Company’s eligible monthly recurring revenues (as defined in the 2019 Revolver). As of February 28, 2023, the Company had outstanding letters of credit to serve as office landlord security deposits in the amount of The 2019 Revolver term ends on July 19, 2024. The interest rate on the outstanding borrowings are at the Bloomberg Short-Term Bank Yield Index (BSBY) rate plus 350 basis points or Base Rate (as defined) plus 250 basis points, with the BSBY rate and Base Rate subject to minimum levels. Interest payments are to be made in installments of one, two, or three months as chosen by the Company. The Company incurred lender and third-party fees when entering into the 2019 Revolver, all of which were deferred at the onset of the facility and have been fully amortized. During the years ended February 28, 2023, 2022, and 2021, the Company recorded interest expense of $203, $296, and $1,106, respectively, related to the revolving credit facility of which $0, $93, and $279, respectively, related to the amortization of deferred financing fees. On July 19, 2022, the Company entered into an amendment to the 2019 Revolver which extended the term until July 19, 2024, documented the transition from the LIBOR interest rate index to the BSBY rate, and established new minimum covenant revenue targets. The term will automatically be extended to July 19, 2025 if the Company has at least $200,000 in consolidated net cash as of May 31, 2024. The 2019 Revolver is collateralized by substantially all of the assets of the Company. |
Stockholders' Equity
Stockholders' Equity | 12 Months Ended |
Feb. 28, 2023 | |
Stockholders' Equity (Deficit) | |
Stockholders' Equity | (11) Stockholders’ Equity (Deficit) (a) Common Stock Upon completion of the IPO, the Company issued and sold 11,526,134 shares of common stock at an issuance price of $22.00 per share resulting in net proceeds of $231,228, after deducting underwriting discounts, commissions, and offering costs. In addition, the Company issued 1,401,836 shares of common stock as a result of the automatic net exercise of warrants. The Company closed its follow-on public offering on October 26, 2020, during which the Company issued and sold 5,750,000 shares of common stock at an issuance price of $38.50 per share resulting in net proceeds of $208,046 after deducting underwriting discounts, commissions, and offering costs. (b) Convertible Preferred Stock On July 7, 2020, upon the closing of the Company’s IPO, all shares of the Company’s outstanding convertible preferred stock converted into 29,479,521 shares of common stock and, as of February 28, 2023, 2022 and 2021, there were no shares of convertible preferred stock outstanding. |
Equity-based Compensation
Equity-based Compensation | 12 Months Ended |
Feb. 28, 2023 | |
Stock-based Compensation | |
Equity-based Compensation | (12) Equity-based Compensation The following table summarizes the amount of stock-based compensation included in the consolidated statements of operations: Year Ended February 28, 2023 2022 2021 Cost of revenue $ 4,794 $ 3,197 $ 948 Product and technology 24,995 18,744 3,387 Sales and marketing 17,275 12,822 2,376 General and administrative 25,580 38,176 2,865 Total stock‑based compensation $ 72,644 $ 72,939 $ 9,576 In July 2020, the Company adopted the 2020 Equity Incentive Plan (the Incentive Plan), which authorized the Company to grant up to 4,300,000 shares of common stock to eligible employees, directors, and consultants to the Company in the form of stock options, restricted stock units, and other various equity awards, including any shares subject to stock options or other awards granted under the Company’s prior stock option plan that expire or terminate for any reason (other than being exercised in full) or are cancelled in accordance with the terms of the prior stock option plan. The Incentive Plan also includes an annual evergreen increase, and the amount, terms of grants, and exercisability provisions are determined by the board of directors. The term of an award may be up to one (a) Stock Options The Company recognizes stock-based compensation based on the grant date fair value of the awards and recognizes that cost using the straight-line method over the requisite service period of the award. The fair value of options, which vest in accordance with service schedules, is estimated on the date of grant using the Black-Scholes option pricing model. Prior to the Company’s IPO in July 2020, the absence of an active market for the Company’s common stock required it to estimate the fair value of the Company’s common stock for purposes of granting stock options and for determining stock-based compensation expense for the periods presented. The Company obtained contemporaneous third-party valuations to assist in determining the estimated fair value of its common stock. These contemporaneous third-party valuations used the methodologies, approaches, and assumptions consistent with the American Institute of Certified Public Accountants Practice Guide, Valuation of Privately-Held-Company Equity Securities Issued as Compensation During the years ended February 28, 2023, 2022, and 2021, the Company recognized $11,798, $10,374, and $7,743, respectively, of compensation expense related to stock options. The Company did not capitalize any stock-based compensation expense to deferred costs for the years ended February 28, 2023, 2022 and 2021. The weighted average grant date fair value for stock options granted during the years ended February 28, 2023, 2022, and 2021 was $5.10, $28.59, and $11.42, respectively. The fair value of the Company’s option grants is estimated at the grant date using the Black-Scholes option-pricing model based on the following assumptions: Year Ended February 28, 2023 2022 2021 Estimated fair value of common stock $5.13-$8.54 $13.59-$31.95 $9.62-$31.27 Exercise price $8.03-$14.05 $23.50-$53.38 $15.40-$50.88 Expected volatility 64%-70% 63%-68% 68%-78% Expected term (in years) 6.08 6.08 5.00-6.25 Risk‑free interest rate 2.71%-4.14% 1.29%-1.39% 0.30%-0.64% Dividend yield — — — The following is a summary of stock option activity under the Option Plan and Incentive Plan: Weighted Weighted ‑ Remaining Aggregate Average Contractual Intrinsic Stock Options Exercise Price Life In Years Value Balance, February 29, 2020 7,996,056 Granted 2,167,775 $ 17.47 Exercised (1,182,099) $ 5.98 Forfeited (257,963) $ Balance, February 28, 2021 8,723,769 Granted 528,038 $ 47.74 Exercised (901,064) $ 9.37 Forfeited (304,951) $ 14.87 Balance, February 28, 2022 8,045,792 Granted 915,081 $ 8.06 Exercised (346,518) $ 5.45 Forfeited (563,836) $ 20.05 Balance, February 28, 2023 8,050,519 5.1 years $ 30,430 Vested and expected to vest as of February 28, 2023 7,893,273 $ 10.43 5.4 years $ 30,106 Exercisable as of February 28, 2023 6,581,769 $ 9.11 4.3 years $ 27,765 The aggregate intrinsic value of stock options exercised was $1,801, $29,964, and $32,972 for the years ended February 28, 2023, 2022, and 2021 respectively. As of February 28, 2023, approximately $13,959 of unrecognized compensation expense related to stock options is expected to be recognized over a weighted average period of 1.7 years. During June 2020, the Company issued 525,907 fully-vested stock options in lieu of cash payments related to the Company’s fiscal 2020 bonus with a value of $5,735 . These options are included in the table above. (b) PlushCare Stock Options In connection with the acquisition of PlushCare, the Company assumed all stock options that were awarded under the PlushCare Plan and that were outstanding as of the closing of the acquisition. These options were converted into options to purchase the Company’s common stock at a ratio determined in the purchase agreement. The Company has no intent to grant any further options under the PlushCare Plan beyond the options granted and outstanding as of the Company's acquisition of PlushCare. The following is a summary of stock option activity under the PlushCare Plan: Weighted Weighted average remaining Aggregate exercise contractual life intrinsic Stock Options price in years value Assumed, June 9, 2021 325,992 Exercised (50,506) $ 1.20 Forfeited (7,765) $ 2.88 Balance, February 28, 2022 267,721 Exercised (111,456) $ 1.65 Forfeited (2,657) $ 2.61 Balance, February 28, 2023 153,608 6.7 years $ 1,456 Vested and expected to vest as of February 28, 2023 124,666 $ 1.36 6.5 years $ 1,216 Exercisable as of February 28, 2023 95,519 $ 1.15 6.3 years $ 951 average period of 1.4 years. The aggregate intrinsic value of stock options exercised was $1,127 and $1,596 for the years ended February 28, 2023 and 2022, respectively. (c) Restricted Stock Units The Company issued 4,470,526, 2,257,433, and 191,415 time-based restricted stock units during the years ended February 28, 2023, 2022 and 2021, respectively. These time-based restricted stock units have generally been subject to a vesting period of two one-eighth The following is a summary of activity for the years ended February 28, 2023, 2022, and 2021: Restricted Stock Units Balance, February 29, 2020 — Granted 191,415 Vested (702) Forfeited — Balance, February 28, 2021 190,713 Granted 2,257,433 Vested (87,574) Forfeited (134,515) Balance, February 28, 2022 2,226,057 Granted 4,470,526 Vested (1,667,550) Forfeited (762,043) Balance, February 28, 2023 4,266,990 In connection with the PlushCare acquisition, the agreement provides for the issuance of time-based restricted stock units for 64,694 shares of common stock to existing PlushCare shareholders, upon achievement of the contingent consideration revenue milestones. During the second quarter of fiscal 2023, 57,124 of these restricted stock units were issued. These restricted stock units are included in the table above. In addition, during fiscal 2023, performance-based restricted stock units were approved to be issued as part of the Company’s corporate bonus program. These restricted stock units are expected to vest in full in fiscal 2024 in association with the Company’s fiscal 2023 corporate bonus payout. At February 28, 2023, 753,259 of these performance-based restricted stock units were approved. During the year ended February 28, 2023, the Company recorded $4,663 in stock-based compensation expense related to these performance-based restricted stock units. (d) Employee Stock Purchase Plan In July 2020, the Board of Directors adopted the Company’s 2020 Employee Stock Purchase Plan (the ESPP), which became effective immediately prior to the effectiveness of the registration statement for the Company’s IPO. The total shares of common stock initially reserved under the ESPP was limited to On March 1, 2022, there was an automatic annual increase, which increased the total available common shares to . Under the ESPP, eligible employees can purchase the Company’s common stock through accumulated payroll deductions at such times as are established by the compensation committee. Eligible employees may purchase the Company’s common stock at 85% of the lower of the fair market value of the Company’s common stock on the first day of the offering period or on the last day of the offering period. Eligible employees may contribute up to 15% of their eligible compensation. Under the ESPP, a participant may not accrue rights to purchase more than $25,000 worth of the Company’s common stock for each calendar year in which such right is outstanding. Employees who elect to participate in the ESPP commence payroll withholdings that accumulate through the end of the respective period. In accordance with the guidance in ASC 718-50 – Compensation – Stock Compensation , During the years ended February 28, 2023, 2022 and 2021, employees who elected to participate in the ESPP purchased a total of 560,345, 140,838, and 67,498 shares of common stock, respectively, resulting in cash proceeds to the Company of $2,927, $4,309, and $1,259 , respectively. An additional (e) Other In connection with the acquisition of 2nd.MD (Note 4), several 2nd.MD individuals entered into agreements with the Company whereby these individuals are eligible to receive an aggregate of 608,332 shares that required continued employment with the Company. These shares are excluded from the above restricted stock units table. Included in the 608,332 shares are 281,531 shares that were also contingent upon the achievement of the contingent consideration milestones. These shares are considered compensatory in the post business combination periods due to the additional service requirement for these individuals. These shares vested 50% on the first anniversary of the acquisition date and 50% on the second anniversary of acquisition date. As a result of the achievement of certain revenue milestones (the contingent consideration milestones), a total of 256,418 of the eligible 281,531 shares will be issued to such shareholders, subject to the service requirements. As of February 28, 2023, there were 241,614 unvested shares outstanding with a grant date fair value of $46.56 per share subject to future service periods. The Company recognized stock-based compensation expense of $4,015 and $23,138 during the years ended February 28, 2023 and 2022, respectively, including $8,981 of accelerated expense related to certain separation and transition agreements entered into during fiscal 2022. As of March 3, 2023, there is no remaining unamortized compensation expense. In connection with the acquisition of PlushCare (Note 4), certain PlushCare individuals entered into agreements with the Company whereby these individuals are eligible to receive an aggregate of 806,161 shares that require continued employment with the Company. These shares are excluded from the above restricted stock units table. These shares are considered compensatory in the post business combination periods due to the additional service requirement for these individuals. One third of these shares vested on the first anniversary of the acquisition date, one third will vest on the second anniversary of acquisition date, and one third will vest on the third anniversary of the acquisition date. As of February 28, 2023, there were 537,401 unvested shares outstanding with a grant date fair value of $52.52 per share. The Company recognized stock-based compensation expense of $14,113 and $10,208 during the years ended February 28, 2023 and 2022, respectively. The unamortized compensation expense of $18,018 will be recognized over a weighted average remaining period of 1.3 years. |
Defined Contribution Retirement
Defined Contribution Retirement Plan | 12 Months Ended |
Feb. 28, 2023 | |
Defined Contribution Retirement Plan | |
Defined Contribution Retirement Plan | (13) Defined Contribution Retirement Plan The Company sponsors a defined contribution retirement plan named the Accolade, Inc. 401(k) Plan (401(k) Plan). Under the 401(k) Plan, eligible employees may contribute up to the maximum allowed by law. Eligible employees are eligible for Company matching contributions on the first quarter following their one-year anniversary date, which are dollar for dollar up to 3.5% of an employee’s eligible compensation, up to $100 in annual compensation. Employer contributions are vested over a period of four years of service. The 401(k) Plan includes an employer discretionary profit-sharing contribution feature to allow the Company to make a contribution to eligible employees’ 401(k) Plan accounts. Profit sharing contributions are vested over a period of four years of service. The Company incurred expenses related to matching contributions totaling $3,231, $2,278, and $1,599 for the years ended February 28, 2023, 2022, and 2021, respectively, which were funded subsequent to each respective year-end. |
Income Taxes
Income Taxes | 12 Months Ended |
Feb. 28, 2023 | |
Income Taxes | |
Income Taxes | (14) Income Taxes Income (loss) before income taxes consists of the following components: Year Ended February 28, 2023 2022 2021 Domestic $ (463,848) $ (129,569) $ (50,934) Foreign 574 806 286 Total $ (463,274) $ (128,763) $ (50,648) Significant components of income taxes are as follows: Year Ended February 28, 2023 2022 2021 Current: Federal $ 156 $ 124 $ — State and Local 90 76 37 Foreign 127 202 141 Total Current 373 402 178 Deferred: Federal (1,638) (7,935) — State and Local (2,359) 1,941 — Foreign — (47) (174) Total deferred (3,997) (6,041) (174) Provision (benefit) for income taxes $ (3,624) $ (5,639) $ 4 A reconciliation of income tax expense at the U.S. Federal statutory income tax rate to actual income tax provision is as follows: Year Ended February 28, 2023 2022 2021 Federal income tax expense at statutory tax rate 21.0 % 21.0 % 21.0 % State income taxes, net of federal tax benefit 2.8 4.5 4.6 Change in state rate (2.1) — — Stock-based compensation (0.3) 0.8 (0.2) Transaction costs — (1.1) 0.0 Contingent consideration — 1.1 — Goodwill impairment (8.6) — — Changes in valuation allowances (11.9) (21.9) (25.4) Other (0.1) — — Effective Income Tax Rate 0.8 % 4.4 % 0.0 % Income tax (expense) benefit for the fiscal years ended February 28, 2023, 2022, and 2021 differ from the U.S. statutory income tax rate primarily due to changes in valuation allowances, state income taxes, goodwill impairment, and stock based compensation. The tax benefit for the year ended February 28, 2023 relates to the partial release of the reversal of the deferred tax liability associated with the basis difference in goodwill from the 2nd.MD acquisition. The goodwill impairment recorded in the first quarter of fiscal 2023 required the Company to reverse that deferred tax liability in the amount of $3,899 and recognize a tax benefit during the year ended February 28, 2023. Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts for income tax purposes. The Company makes significant judgments regarding the realizability of its deferred tax assets (principally net operating losses). The carrying value of deferred tax assets is based on the Company’s assessment that it is more likely than not that the Company will realize these assets after consideration of all available positive and negative evidence. Significant components of the Company’s deferred tax assets and liabilities at February 28, 2023 and 2022 are as follows: February 28, 2023 2022 Deferred tax assets: Net operating loss and tax credit carryforwards $ 113,740 $ 114,272 Other accruals and reserves 5,599 5,210 Stock‑based compensation 32,741 16,353 Interest expense deduction limitation carryforward 3,092 3,082 Intangibles 6,248 — Property, plant & equipment 869 578 Capitalized research and development 10,931 — Lease liability 10,086 10,027 Other — 94 Valuation allowance (175,610) (125,810) Deferred tax assets 7,696 23,806 Deferred tax liabilities: Operating lease right-of-use assets (7,478) (8,494) Intangibles — (19,091) Deferred tax liabilities (7,478) (27,585) Net deferred taxes $ 218 $ (3,779) Deferred tax liabilities are included in other noncurrent liabilities on the consolidated balance sheet. Net operating loss (NOL) carryforwards amounted to $453,323 and $422,481 for U.S. federal and $402,376 and $372,975 for U.S. states at February 28, 2023 and 2022, respectively. These NOL carryforwards related to the 2010 through current 2022 tax periods. At February 28, 2023, none of the NOL carryforwards were subject to expiration until 2030. The NOL carryforwards expiring in years 2030 through 2037 make up $59,213 of the recorded deferred tax asset. The remaining deferred tax asset relating to NOL carryforwards of $54,101 have an indefinite expiration. In addition to NOL carryforwards, research and development tax credit carryforwards amounted to $432 for U.S. federal and U.S. states at February 28, 2023. These tax credit carryforwards will expire in 2036. Under Section 382 of the Internal Revenue Code, the yearly utilization of a corporation’s NOL carryforwards may be limited following a change in ownership of greater than 50% (by value) over a three-year period. The yearly limitation is based on the value of the corporation immediately before the ownership change multiplied by the federal long-term tax-exempt rate. If a loss is not utilized in a year after an ownership change that yearly limit is carried forward to future years for the balance of the NOL carryforward period. As of February 28, 2023, the Company did not incorporate a yearly limitation under Section 382 as a recent study has not been completed. Management assesses the available positive and negative evidence to estimate if a valuation allowance is required to be recorded against existing deferred tax assets. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible. Management considers the scheduled reversal of deferred tax liabilities, projected future taxable income, and tax planning strategies in making this assessment. Based upon the Company’s brief operating history and the net losses incurred since inception, management does not believe that it is more likely than not that the Company will realize the benefits of these deductible differences in the U.S. As a result, a full valuation allowance has been provided at February 28, 2023 and 2022 for U.S. Federal and state tax purposes. The following is a summary of NOL activity: Year Ending February 28, 2023 2022 Balance at the beginning of the period $ 125,810 $ 96,516 Increase due to NOLs and temporary differences 54,937 35,287 Decrease due to acquisitions (5,137) (5,993) Balance at the end of the period $ 175,610 $ 125,810 The Company has recorded a deferred tax asset of $3,092 for interest expense limited under the Tax Act at February 28, 2023. The interest expense limited has an unlimited carryforward period. U.S. income and foreign withholding taxes have not been recognized on the excess of the amount for financial reporting over tax basis of the investments in foreign subsidiaries that is indefinitely reinvested outside the U.S. The foreign subsidiary is identified as a branch for U.S. tax purposes, and therefore, a gross temporary difference for investment basis differences is not applicable. The Company had no material accrual for uncertain tax positions or interest or penalties related to income taxes on the Company’s consolidated balance sheets at February 28, 2023 and 2022 and has not recognized any material uncertain tax positions or interest and/or penalties related to income taxes in the consolidated statement of operations for the years ended February 28, 2023, 2022, and 2021. |
Net Loss Per Common Share
Net Loss Per Common Share | 12 Months Ended |
Feb. 28, 2023 | |
Net Income (Loss) Per Share Attributable to Common Stockholders | |
Net Loss Per Common Share | (15) Net Loss Per Share Attributable to Common Stockholders The following table sets forth the computation of basic and diluted net loss per common share: Year Ended February 28, 2023 2022 2021 Net loss $ (459,650) $ (123,124) $ (50,652) Net loss per common share, basic and diluted $ (6.45) $ (1.93) $ (1.72) Weighted‑average shares used to compute net loss per common share, basic and diluted 71,279,831 63,823,270 29,370,594 As the Company has reported net losses for each of the periods presented, all potentially dilutive securities are antidilutive. The following potential outstanding shares of common stock were excluded from the computation of diluted net loss per common share for the periods presented because including them would have been antidilutive: Year Ended February 28, 2023 2022 2021 Stock options 8,204,127 8,313,513 8,723,769 Unvested restricted stock units 4,266,990 2,226,057 190,713 Shares issued to 2nd.MD employees and subject to vesting 274,224 326,801 — Shares issued to PlushCare employees and subject to vesting 537,401 806,161 — Contingent shares in connection with PlushCare acquisition 102,111 102,111 — Indemnity shares held in escrow in connection with PlushCare acquisition 27,342 27,342 — Shares to be issued to HealthReveal shareholders upon expiration of indemnification period 28,089 28,089 — Convertible Senior Notes 5,700,297 5,700,297 Total 19,140,581 17,530,371 8,914,482 |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Feb. 28, 2023 | |
Commitments and Contingencies. | |
Commitments and Contingencies | (16) Commitments and Contingencies (a) Legal Proceedings The Company is involved in various claims, inquiries and legal actions arising in the ordinary course of business. In the opinion of management, the ultimate disposition of these matters is not expected to have a material adverse effect on the Company’s financial position or liquidity. As of February 28, 2023, the Company had accruals of $3,700 related to legal matters. On May 8, 2021, a purported class action complaint ( Robbins v. PlushCare, Inc. et al. (b) Employment Agreements Certain officers of the Company have employment agreements providing for severance, continuation of benefits, and other specified rights in the event of termination without cause, including in the event of a change of control of the Company, as defined in the agreements. (c) Purchase Obligations The Company has minimum required purchase commitments of $40,323 pursuant to an agreement primarily related to cloud computing services. Portions of the total purchase commitment are required to be met prior to the end of each contract year, September 30, in each of fiscal years 2023 through 2027. If total purchases in a contract year do not meet the portion of the commitment required for that year, the shortfall must be prepaid and can be used for future purchases through September 30, 2027. As of February 28, 2023, the Company has remaining future purchase commitments under this agreement of $31,995. |
Related Party Transactions
Related Party Transactions | 12 Months Ended |
Feb. 28, 2023 | |
Related Party Transactions | |
Related Party Transactions | (17) Related Party Transactions Entities affiliated with one of the Company’s significant customers owned more than 5% of the Company’s outstanding stock during the year ended February 28, 2021. Revenues related to this customer were $27,300 during the fiscal year ended February 28, 2021. As of February 28, 2023, 2022, and 2021, these entities no longer owned more than 5% of the Company’s outstanding stock. |
Restructuring
Restructuring | 12 Months Ended |
Feb. 28, 2023 | |
Restructuring and Related Activities [Abstract] | |
Restructuring | (18) Restructuring Year Ended February 28, 2023 Cost of revenue, excluding depreciation and amortization $ 1,025 Product and technology 2,149 Sales and marketing 1,948 General and administrative 1,943 Total severance costs $ 7,065 Balance as of March 1, 2022 $ — Severance costs 7,065 Cash payments (3,069) Balance as of February 28, 2023 $ 3,996 |
Basis of Presentation and Summa
Basis of Presentation and Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Feb. 28, 2023 | |
Basis of Presentation and Summary of Significant Accounting Policies. | |
Basis of Presentation and Principles of Consolidation | (a) Basis of Presentation and Principles of Consolidation Accolade’s consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (U.S. GAAP) and include the Company’s accounts and those of the Company’s wholly owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. Through the acquisition of PlushCare, Inc. (PlushCare), the Company has various administrative service agreements (ASA) with professional medical corporations established in California, Illinois, Wyoming, and New Jersey (PC). The PCs employ or contract with medical providers who provide services via the Company’s technology platform. The ASAs are evergreen and are terminable by the parties for breach or bankruptcy. Through the ASAs, the Company provides non-clinical administrative services to the PCs and manages the economic activities that most significantly affect PCs. The PCs retain control over the provision of medical services and the PC’s clinical personnel. The PCs are variable interest entities (VIE) to the Company. Under Accounting Standards Codification Subtopic 810 – Consolidation The PCs and the Company are independent entities, and as such creditors of the PCs do not have recourse against the Company in the event of default by the PCs. Additionally, the PCs’ non-cash assets are available to the Company to satisfy obligations or for other corporate purposes. |
Use of Estimates | The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, including the fair value of assets acquired and liabilities assumed for business combinations, unbilled revenues and deferred revenues, certain accrued expenses, stock-based compensation, assessment of the useful life and recoverability of long-lived assets, income taxes, disclosure of contingent assets and liabilities at the date of the consolidated financial statements, assessment of the recoverability of goodwill, and the reported amounts of revenues and expenses during the reporting period. To the extent there are material differences between these estimates, judgments, or assumptions and actual results, the Company’s financial statements will be affected. |
Comprehensive Loss | (c) Comprehensive Loss For the fiscal years ended February 28, 2023, 2022, and 2021, there was no difference between comprehensive loss and net loss. |
Fair Value of Financial Instruments | (d) Fair Value of Financial Instruments The carrying value of the Company’s financial instruments, including cash equivalents, accounts receivable, unbilled revenue, other current assets, accounts payable, and accrued expenses approximates fair value due to the short-term nature of those instruments. The Company measures financial assets and liabilities at fair value at each reporting period using a fair value hierarchy that requires the use of observable inputs and minimizes the use of unobservable inputs. The Company defines fair value as the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Fair value is estimated by applying the following hierarchy, which prioritizes the inputs used to measure fair value into three levels and bases the categorization within the hierarchy upon the lowest level of input that is available and significant to the fair value measurement: ● Level 1 — Quoted prices in active markets for identical assets or liabilities. ● Level 2 — Observable inputs other than quoted prices in active markets for identical assets and liabilities, quoted prices for identical or similar assets or liabilities in inactive markets, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. ● Level 3 — Inputs that are generally unobservable and typically reflect the Company’s estimate of assumptions that market participants would use in pricing the asset or liability. |
Cash and Cash Equivalents | (e) Cash and Cash Equivalents Cash and cash equivalents is comprised of cash in banks and highly liquid investments, including U.S. treasury bills purchased with an original maturity of three months or less. Cash equivalents consist of investments in money market funds for which the carrying amount approximates fair value, due to the short maturities of these instruments. |
Marketable Securities | (f) Marketable Securities The Company classifies its marketable securities as available-for-sale, which include U.S. treasury bills with original maturities of greater than three months. These securities are carried at fair market value. There were no purchases or sales of marketable securities during the year ended February 28, 2023. The total unrecognized gain related to the marketable securities was inconsequential during the year ended February 28, 2022. |
Accounts Receivable and Unbilled Revenue | (g) Accounts Receivable and Unbilled Revenue Accounts receivable are recorded at the invoiced amount and do not bear interest. The Company does not have any off-balance-sheet credit exposure related to its customers. The Company records unbilled revenue for services performed on contracts for amounts not yet billed to customers. |
Property and Equipment | (h) Property and Equipment Property and equipment are recorded at cost. Property and equipment are depreciated on a straight-line basis over their estimated useful lives. Useful lives for property and equipment are as follows: Property and Equipment Estimated Useful Life Office equipment and furniture 7 years Computer equipment 3 - 5 years Computer software 3 - 5 years Leasehold improvements Lesser of estimated useful life or remaining lease term |
Capitalized Internal-Use Software Costs | (i) Capitalized Internal-Use Software Costs Costs related to software acquired, developed, or modified solely to meet the Company’s internal requirements, including tools that enable the Company’s employees to interact with members and their providers, with no substantive plans to market such software at the time of development, are capitalized. Costs incurred during the preliminary planning and evaluation stage of the project and during the post-implementation operational stage are expensed as incurred. Costs related to minor upgrades, minor enhancements, and maintenance activities are expensed as incurred. Costs incurred during the application development stage of the project are capitalized. Internal-use software is included in property and equipment and is amortized on a straight-line basis over 3 years. For the fiscal years ended February 28, 2023, 2022, and 2021, the Company capitalized $5,709, $1,096, and $374, respectively, for internal-use software. Amortization expense related to capitalized internal-use software during the fiscal years ended February 28, 2023, 2022, and 2021 was $1,196, $2,387, and $4,560, respectively. |
Impairment of Long Lived Assets | (j) Impairment of Long-Lived Assets The Company reviews long-lived assets, such as property and equipment and finite-lived intangibles, for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to estimated undiscounted future cash flows expected to be generated by the asset. If the carrying amount of an asset exceeds its estimated undiscounted future cash flows, then an impairment charge is recognized for the amount by which the carrying value of the asset exceeds the fair value of the asset. There were no long-lived asset impairment charges recorded during the fiscal years ended February 28, 2023, 2022, and 2021. |
Intangible Assets | (k) Intangible Assets The Company has acquired intangible assets through various acquisitions. Intangible assets are recorded at fair value on the date of acquisition and are subject to amortization over the estimated useful lives of each asset. Estimates of fair value and useful lives are based on historical factors, current circumstances, and the experience and judgment of management. Estimates and assumptions used to value intangible assets are evaluated by management on an ongoing basis. |
Goodwill | (l) Goodwill Goodwill is the excess of the cost of an acquired entity over the net amounts assigned to tangible and intangible assets acquired and liabilities assumed. Goodwill is not amortized, but is subject to evaluations of its recoverability annually and upon the identification of a triggering event. The Company has a single reporting unit and all goodwill relates to that reporting unit. The Company performs an impairment analysis of goodwill on an annual basis in the fourth quarter of each fiscal year or more frequently if changes in circumstances or the occurrence of events suggest that an impairment exists. If the fair value of the reporting unit is less than its carrying value, an impairment loss is recorded. A goodwill impairment loss was recorded during the first quarter of fiscal 2023. See Note 5 for further information. The Company did |
Revenue and Deferred Revenue | (m) Revenue and Deferred Revenue Revenue Recognition The Company generates revenue by providing customers access to its advocacy, expert medical opinion, and virtual primary care services, as well as through utilization of its expert medical opinion and virtual primary care services. Contracts with customers that include expert medical opinion or virtual primary care services may contain either an access fee, a utilization-based fee, or both. In accordance with Accounting Standards Codification (ASC) 606, Revenue from Contracts with Customers ● identification of the contract, or contracts with a customer; ● identification of the performance obligations in the contract; ● determination of the transaction price; ● allocation of the transaction price to the performance obligations in the contracts; and ● recognition of revenue when, or as, the Company satisfies a performance obligation. At contract inception, the Company assesses the type of services being provided and assesses the performance obligations in the contract. The transaction price is allocated to the separate performance obligations on a relative standalone selling price basis. The Company determines the standalone selling prices based on overall pricing objectives, taking into consideration market conditions and other factors, using an expected cost plus margin approach. The Company considered the variable consideration allocation exception in ASC 606 for its advocacy contracts and concluded that such exception for allocating variable consideration to distinct performance obligations or distinct time periods within a series was not met primarily due to variability in its per-member-per-month (PMPM) pricing. The majority of fees earned by the Company are considered to be variable consideration due to both the uncertainty regarding the total number of members, consultations or visits for which the Company will invoice the customer, as well as the variable PMPM fees that are dependent upon the achievement of performance metrics and/or healthcare cost savings. Performance metrics are measured monthly, quarterly, or annually, and with respect to the achievement of healthcare cost savings targets, annually (typically measured on a calendar year basis). Accordingly, at contract inception and on an ongoing basis, as part of the Company’s estimate of the transaction price, the Company determines whether any such fees should be constrained, and the Company includes the estimated consideration for those fees to the extent that it is probable that a significant reversal of cumulative revenue recognized will not occur (and is therefore considered to be unconstrained). Consideration related to the Company’s achievement of healthcare cost savings is typically constrained until the end of the applicable calendar year due to uncertainty related to factors outside of the Company’s control. Consideration related to other performance metrics is typically not constrained based on the Company’s prior success of achieving such metrics. On an ongoing basis, the Company reassesses its estimates for variable consideration, which can change based upon its assessment of the achievement of performance metrics and healthcare cost savings, as well as the number of members, consultations, or visits. Access Fees The Company generates revenue primarily from contracts with customers to access the Company’s advocacy, expert medical opinion, and virtual primary care services. The Company prices access fees primarily using a recurring PMPM fee, typically with a portion of the fee calculated as the product of a fixed rate times the number of members (fixed PMPM fee), plus a variable PMPM fee calculated as the product of a variable rate times the number of members (variable PMPM fee). The fees associated with the variable PMPM fee can be earned through the achievement of performance metrics and/or the realization of healthcare cost savings resulting from use of the Company’s services. Collectively, the fixed PMPM fee and variable PMPM fee are referred to as the total PMPM fee. The Company’s PMPM pricing varies by contract. In certain contracts, the maximum total PMPM fee varies during the contract term (total PMPM rate increases or decreases annually), while in other contracts, the total PMPM maximum fee is consistent over the term, yet the fixed and variable portions vary. For example, in certain contracts the fixed PMPM fee increases on an annual basis while the variable PMPM fee decreases on an annual basis, resulting in the same total PMPM fee throughout the term of the contract. The PMPM fees for expert medical opinion and virtual primary care services may be tiered based upon the customer’s utilization. Access to the Company’s services represent a single stand-ready performance obligation. The Company’s contracts include stand-ready services to provide eligible participants with access to the Company’s services and to perform an unspecified quantity of interactions with members during the contract period. Accordingly, the Company’s services are generally viewed as stand-ready performance obligations comprised of a series of distinct daily services that are substantially the same and have the same pattern of transfer. For advocacy services, the Company satisfies these performance obligations over time and recognizes revenue related to its services as the services are provided using a measure of progress based upon the actual number of members eligible for the service during the respective period as a percentage of the estimated members expected to be eligible for the service over the term of the contract. The Company believes a measure of progress based on the number of members is the most appropriate measurement of control of the services being transferred to the customer as the amount of internal resources necessary to stand-ready is directly correlated to the number of members who can use the services. For the majority of expert medical opinion services, the Company satisfies these performance obligations over time and recognizes revenue in the amount of consideration for which it has the right to invoice using the as-invoiced practical expedient. Access fees also include access to the Company’s virtual primary care services sold directly to consumers on a monthly or yearly fixed fee subscription basis. For these services, the Company satisfies these stand-ready performance obligations over time and recognizes revenue ratably over the subscription period. Utilization-based fees The Company also generates revenue when members utilize the expert medical opinion and virtual primary care services that are billed based on utilization. Many, but not all, contracts with customers contain utilization-based fees. For any utilization-based fees, the Company satisfies these performance obligations over time and recognizes revenue in the amount of consideration for which it has the right to invoice using the as-invoiced practical expedient for any consultations or visits sold to commercial customers as well as any non-insured consultations or visits related to virtual primary care services sold directly to consumers. For any consultations or visits that are paid through insurance claims, the Company recognizes revenue as the consultations and visits occur in an amount that reflects the consideration that is expected based upon then-current prices and historical experience from insurance payors. Deferred Revenue The Company typically invoices its customers in advance of the services performed on a monthly or quarterly basis, and the amount invoiced typically represents the maximum total PMPM fee for the estimated number of eligible members over the applicable invoice period. The total PMPM fee covers the stand-ready services in the Company’s typical contracts (i.e., the performance obligations are not separately priced or invoiced). The maximum total PMPM fee that is invoiced includes both the fixed PMPM fee and the variable PMPM fee related to the performance metrics and/or the realization of healthcare cost savings that can be achieved during the period. These fees are classified as deferred revenue on the Company’s consolidated balance sheet until such time that revenue can be recognized. In the event the Company fails to satisfy any of the performance metrics and/or realization of healthcare cost savings that are billed in advance, the Company will refund the applicable portion of the fee or offset the amount against a future invoice. These amounts are included in due to customers on the Company’s consolidated balance sheet. The Company’s accounts receivable represent rights to consideration that are unconditional. |
Concentration of Credit Risk | Financial instruments that potentially subject the Company to credit risk consist principally of cash, cash equivalents, and marketable securities. The Company maintains its cash primarily with domestic financial institutions of high credit quality, which may exceed federal deposit insurance corporation limits. The Company invests its cash equivalents in highly rated money market funds and U.S. treasury bills with original maturities of three months or less. Marketable securities are comprised of U.S. treasury bills with original maturities greater than three months. The Company has not experienced any losses in such accounts. The Company believes it is not exposed to any significant credit risk on cash, cash equivalents, and marketable securities and performs periodic evaluations of the credit standing of such institutions. Significant customers are those which represent 10% or more of the Company’s revenue during the period. For each significant customer, revenue as a percentage of total revenue was as follows: Year Ended February 28, 2023 2022 2021 Customer 1 * % * % 16.0 % Customer 2 * % * % 11.8 % Customer 3 * % * % 10.2 % Customer 4 * % * % 9.8 % Total * % * % 47.8 % *For the fiscal years ended February 28, 2023 and 2022, no customer represented 10% or more of the Company’s revenue. |
Stock Based Compensation | (o) Stock-Based Compensation The Company recognizes compensation cost for awards to employees, nonemployee directors, consultants, and advisors based on the grant date fair value of stock-based awards on a straight-line basis over the period during which an award holder is required to provide service in exchange for the award. The Company estimates the fair value of each employee stock option on the date of grant using the Black-Scholes option pricing model. |
Cost of Revenue, excluding Depreciation and Amortization | (p) Cost of Revenue, excluding Depreciation and Amortization Cost of revenue, excluding depreciation and amortization, consists primarily of personnel costs including salaries, wages, overtime, bonuses, stock-based compensation expense, and benefits, as well as software and tools for telephony, business analytics, allocated overhead costs, and other expenses related to delivery and implementation of the Company’s personalized technology-enabled solutions. |
Product and Technology | (q) Product and Technology Product and technology expenses consist of personnel expenses, including salaries, bonuses, stock-based compensation expense, and benefits for employees and contractors for engineering, product, and design teams, and allocated overhead costs, as well as costs of software and tools for business analytics, data management, and IT applications that are not directly associated with delivery of the Company’s solutions to customers. |
Income Taxes | (r) Income Taxes The provision for income taxes was determined using the asset and liability approach of accounting for income taxes. Under this approach, deferred taxes represent the future tax consequences expected to occur when the reported amounts of assets and liabilities are recovered or paid. The provision for income taxes represents income taxes paid or payable for the current year plus the change in deferred taxes during the period. Deferred taxes result from differences between the financial and tax basis of the Company’s assets and liabilities and are adjusted for changes in tax rates and tax laws when changes are enacted. Valuation allowances are recorded to reduce deferred tax assets when it is more likely than not that a tax benefit will not be realized. Deferred tax assets and liabilities are measured using enacted tax rates applicable in the years in which they are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax law is recognized in income in the period that includes the enactment date. In evaluating the ability to realize deferred tax assets, the Company relies on taxable income in prior carryback years, the future reversals of existing taxable temporary differences, future taxable income, and tax planning strategies. Consistent with the provisions of FASB ASC Topic 740, Income Taxes |
Segments | (s) Segments The Company’s chief operating decision maker, its Chief Executive Officer, reviews the financial information presented on a consolidated basis for purposes of allocating resources and evaluating its financial performance. Accordingly, the Company has determined that it operates in a single reportable segment. As of February 28, 2023, 2022, and 2021, substantially all of Accolade’s long-lived assets were located in the United States, and all revenue was earned in the United States. |
Leases | (t) Leases Whenever the Company enters into a new arrangement, it determines, at the inception date, whether the arrangement is or contains a lease. This determination generally depends on whether the arrangement conveys to the Company the right to control the use of an explicitly or implicitly identified asset for a period of time in exchange for consideration. Control of an underlying asset is conveyed to the Company if the Company obtains the right to direct the use of, and obtain substantially all the economic benefits from, the use of the underlying asset. If a lease exists, the Company then determines the separate lease and non-lease components of the arrangement. Each right to use an underlying asset conveyed by a lease arrangement should generally be considered a separate lease component if it both: (i) can benefit the Company without depending on other resources not readily available to the Company and (ii) does not significantly affect, and is not significantly affected by, other rights of use conveyed by the lease. Aspects of a lease arrangement that transfer other goods or services to the Company but do not meet the definition of lease components are considered non-lease components. The consideration owed by the Company pursuant to a lease arrangement is generally allocated to each lease and non-lease component for accounting purposes. However, the Company has elected, for all of its leases, to not separate lease and non-lease components. For each lease, the Company then determines the lease term, the present value of lease payments, and the classification of the lease as either an operating or finance lease. The lease term is the period of the lease not cancellable by the Company, together with periods covered by: (i) renewal options the Company is reasonably certain to exercise, (ii) termination options the Company is reasonably certain not to exercise, and (iii) renewal or termination options that are controlled by the lessor. The present value of lease payments is calculated based on: (1) Lease payments – Lease payments included in the measurement of the lease asset or liability comprise the following: fixed payments (including in-substance fixed payments), and the exercise price of a lessee option to purchase the underlying asset if the lessee is reasonably certain to exercise. (2) Discount rate – the discount rate is determined based on information available to the Company upon the commencement of the lease. Lessees are required to use the rate implicit in the lease whenever such rate is readily available; however, as the implicit rate in the Company’s leases is generally not readily determinable, the Company generally uses the incremental borrowing rate it would have to pay to borrow an amount equal to the lease payments, on a collateralized basis, over a timeframe similar to the lease term. In making the determination of whether a lease is an operating lease or a finance lease, the Company considers the lease term in relation to the economic life of the leased asset, the present value of lease payments in relation to the fair value of the leased asset and certain other factors, including the lessee’s and lessor’s rights, obligations, and economic incentives over the term of the lease. The Company does not recognize leases with an initial term of 12 months or less on its consolidated balance sheets and recognizes these payments in the consolidated statements of operations on a straight-line basis over the lease term. Certain leases contain variable payments which are based on usage or operating costs, such as utilities and maintenance. These payments are not included in the measurement of the lease liability or corresponding right-of-use asset due to the uncertainty of the payment amount and are recorded as lease expense in the period incurred. |
Recently Issued Accounting Standards | (u) Recently Issued Accounting Pronouncements In June 2022, the FASB issued ASU 2022-03, Fair Value Measurement (Topic 820): Fair Value Measurement of Equity Securities Subject to Contractual Sale Restrictions certain disclosures for equity securities subject to contractual sale restrictions that are measured at fair value in accordance with Topic 820. This guidance is effective for annual reporting periods, including interim periods, beginning after December 15, 2023, with early adoption permitted. The provisions of ASU 2022-03 are to be applied prospectively with any adjustments made to earnings on the date of adoption. The Company is currently evaluating the impact, if any, of this guidance on its financial statements. |
Basis of Presentation and Sum_2
Basis of Presentation and Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Feb. 28, 2023 | |
Basis of Presentation and Summary of Significant Accounting Policies | |
Summary of useful lives for property and equipment | Property and Equipment Estimated Useful Life Office equipment and furniture 7 years Computer equipment 3 - 5 years Computer software 3 - 5 years Leasehold improvements Lesser of estimated useful life or remaining lease term |
Schedule of concentration of risk | Year Ended February 28, 2023 2022 2021 Customer 1 * % * % 16.0 % Customer 2 * % * % 11.8 % Customer 3 * % * % 10.2 % Customer 4 * % * % 9.8 % Total * % * % 47.8 % *For the fiscal years ended February 28, 2023 and 2022, no customer represented 10% or more of the Company’s revenue. |
Revenue (Tables)
Revenue (Tables) | 12 Months Ended |
Feb. 28, 2023 | |
Revenue | |
Disaggregation of revenue | Year Ended February 28, 2023 2022 Access fees $ 284,144 $ 264,612 Utilization-based fees 78,998 45,409 Total $ 363,142 $ 310,021 |
Revenue expected to be recognized from remaining performance obligations | Year Ending February 28(29), 2024 $ 152,976 2025 56,778 2026 14,888 2027 372 2028 34 Total $ 225,048 |
Acquisitions (Tables)
Acquisitions (Tables) | 12 Months Ended |
Feb. 28, 2023 | |
Business Acquisition [Line Items] | |
Schedule of proforma results | Unaudited Pro Forma Year ended February 28, 2022 2021 Revenue $ 324,367 $ 249,028 Net income (loss) $ (137,644) $ (142,392) |
Acquisition of 2nd.MD | |
Business Acquisition [Line Items] | |
Schedule of purchase consideration | Consideration Cash consideration, net of cash acquired $ 226,135 Fair value of common stock issued 116,187 Fair value of replacement awards 1,520 Fair value of contingent consideration 76,248 Total consideration $ 420,090 |
Schedule of estimated fair values of the assets acquired and liabilities assumed | Assets acquired: Accounts receivable $ 5,550 Unbilled revenue 226 Current portion of deferred contract acquisition costs 176 Prepaid and other current assets 1,052 Property and equipment 4,344 Deferred contract acquisition costs 564 Goodwill 208,286 Intangible assets (1) Customer relationships 120,000 Technology 58,000 Supplier-based network 25,000 Trade name 3,400 Non-compete agreement 3,100 Total assets acquired $ 429,698 Liabilities assumed: Accounts payable $ 1,195 Accrued expenses 585 Accrued compensation 3,817 Deferred rent and other current liabilities 904 Due to customers 294 Current portion of deferred revenue 625 Deferred rent and other noncurrent liabilities 2,188 Total liabilities assumed $ 9,608 Net assets acquired $ 420,090 (1) The weighted-average useful life of intangible assets acquired is approximately 14 years . |
PlushCare | |
Business Acquisition [Line Items] | |
Schedule of purchase consideration | Consideration Fair value of common stock issued $ 330,338 Fair value of contingent consideration 44,618 Cash consideration, net of cash acquired 33,860 Fair value of replacement awards 5,209 Total consideration $ 414,025 |
Schedule of estimated fair values of the assets acquired and liabilities assumed | Assets acquired: Accounts receivable $ 1,359 Prepaid and other current assets 573 Property and equipment 298 Other noncurrent assets 932 Goodwill 365,597 Intangible assets (1) Customer relationships 4,050 Technology 40,650 Trade name 10,300 Non-compete agreements 6,200 Total assets acquired $ 429,959 Liabilities assumed: Accounts payable $ 1,532 Accrued expenses 193 Accrued compensation 2,117 Current portion of deferred revenue 1,212 Deferred tax liability 9,992 Other liabilities 888 Total liabilities assumed $ 15,934 Net assets acquired $ 414,025 (1) The weighted-average useful life of intangible assets acquired is approximately 5 years . |
Goodwill and Intangible Assets
Goodwill and Intangible Assets (Tables) | 12 Months Ended |
Feb. 28, 2023 | |
Goodwill and Intangible Assets | |
Schedule of changes in the carrying amount of goodwill | Balance, February 28, 2021 $ 4,013 Acquisitions 573,883 Balance, February 28, 2022 $ 577,896 Impairment (299,705) Balance, February 28, 2023 $ 278,191 |
Schedule of Intangible assets | As of February 28, 2023 As of February 28, 2022 Weighted Avg. Remaining Useful Life (years) Gross Value Accumulated Amortization Net Carrying Value Gross Value Accumulated Amortization Net Carrying Value Customer relationships 17.9 $ 124,050 $ (15,353) $ 108,697 $ 124,050 $ (7,444) $ 116,606 Technology 3.0 111,526 (45,046) 66,480 111,526 (21,971) 89,555 Supplier-based network 3.0 25,000 (10,000) 15,000 25,000 (5,000) 20,000 Trade name 8.2 13,700 (2,483) 11,217 13,700 (1,112) 12,588 Non-compete agreement 0.7 9,300 (7,492) 1,808 9,300 (3,359) 5,941 $ 283,576 $ (80,374) $ 203,202 $ 283,576 $ (38,886) $ 244,690 |
Schedule of Finite-Lived Intangible Assets, Future Amortization Expense [Table Text Block] | Year Ending February 28(29), 2024 $ 37,795 2025 34,143 2026 32,125 2027 9,403 2028 7,370 Thereafter 82,366 203,202 |
Property and Equipment (Tables)
Property and Equipment (Tables) | 12 Months Ended |
Feb. 28, 2023 | |
Property and Equipment | |
Schedule of Property and Equipment | February 28, 2023 2022 Capitalized software development costs $ 39,097 $ 33,388 Computer software 6,026 6,023 Computer equipment 12,363 10,518 Office equipment, furniture, and leasehold improvements 12,120 11,838 69,606 61,767 Less accumulated depreciation (54,843) (49,970) Total $ 14,763 $ 11,797 |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Feb. 28, 2023 | |
Leases | |
Schedule of components of operating lease cost | Year Ended February 28, 2023 2022 Operating lease cost 7,575 $ 7,169 Variable lease cost 2,042 1,691 Total lease cost 9,617 $ 8,860 |
Schedule of cash flow and supplemental information | Year Ended February 28, Cash Flow Information 2023 2022 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 8,569 $ 8,310 Right-of-use assets obtained in exchange for lease obligations Operating leases $ 2,170 $ 3,564 Supplemental Information February 28, 2023 Weighted-average remaining lease term (years) 5.3 Weighted-average discount rate 5.0 % |
Summary of future aggregate minimum lease payments as of under all non-cancelable operating leases | Year Ending February 28(29), 2024 $ 8,849 2025 7,270 2026 7,303 2027 6,420 2028 3,665 Thereafter 5,732 Total lease payments 39,239 Less: Imputed interest (4,766) Total lease liabilities $ 34,473 |
Accrued Expenses and Other Cu_2
Accrued Expenses and Other Current Liabilities (Tables) | 12 Months Ended |
Feb. 28, 2023 | |
Accrued Expenses and Accrued Compensation | |
Schedule of Accrued Expenses | February 28, 2023 2022 Current portion of loans payable, net of unamortized issuance cost $ 596 $ 596 Professional and consulting fees 1,992 2,661 Taxes 528 769 Marketing 347 1,492 Accrued litigation (1) 3,700 888 Software, hardware, and communication costs 464 600 Payable related to acquisition earnout — 1,969 Other 4,117 2,025 Total $ 11,744 $ 11,000 (1) See Note 16 for discussion regarding accrued litigation matters . |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 12 Months Ended |
Feb. 28, 2023 | |
Fair Value Measurements | |
Schedule of fair value of financial assets | February 28, 2023 Level 1 Level 2 Level 3 Fair Value Assets Cash equivalents: Money market funds $ 99,861 $ — $ — $ 99,861 United States treasury bills $ 39,995 $ — $ — $ 39,995 February 28, 2022 Level 1 Level 2 Level 3 Fair Value Assets Cash equivalents: Money market funds $ 131,527 $ — $ — $ 131,527 United States treasury bills $ 99,999 $ — $ — $ 99,999 |
Schedule of changes in the Company's Level 3 contingent consideration liabilities | Balance, February 28, 2021 $ — Incurred through acquisition 120,866 Change in fair value (45,416) Reclassification to equity and accrued expenses and other current liabilities (75,450) Balance, February 28, 2022 $ — |
Debt (Tables)
Debt (Tables) | 12 Months Ended |
Feb. 28, 2023 | |
Debt | |
Schedule Of Debt | February 28, 2023 Principal $ 287,500 Unamortized issuance costs (5,177) Net carrying amount $ 282,323 |
Equity-based Compensation (Tabl
Equity-based Compensation (Tables) | 12 Months Ended |
Feb. 28, 2023 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Schedule of stock-based compensation | Year Ended February 28, 2023 2022 2021 Cost of revenue $ 4,794 $ 3,197 $ 948 Product and technology 24,995 18,744 3,387 Sales and marketing 17,275 12,822 2,376 General and administrative 25,580 38,176 2,865 Total stock‑based compensation $ 72,644 $ 72,939 $ 9,576 |
Schedule of weighted average assumptions | Year Ended February 28, 2023 2022 2021 Estimated fair value of common stock $5.13-$8.54 $13.59-$31.95 $9.62-$31.27 Exercise price $8.03-$14.05 $23.50-$53.38 $15.40-$50.88 Expected volatility 64%-70% 63%-68% 68%-78% Expected term (in years) 6.08 6.08 5.00-6.25 Risk‑free interest rate 2.71%-4.14% 1.29%-1.39% 0.30%-0.64% Dividend yield — — — |
Schedule of restricted stock units activity | Restricted Stock Units Balance, February 29, 2020 — Granted 191,415 Vested (702) Forfeited — Balance, February 28, 2021 190,713 Granted 2,257,433 Vested (87,574) Forfeited (134,515) Balance, February 28, 2022 2,226,057 Granted 4,470,526 Vested (1,667,550) Forfeited (762,043) Balance, February 28, 2023 4,266,990 |
2020 Equity Incentive Plan | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Schedule of stock option activity | Weighted Weighted ‑ Remaining Aggregate Average Contractual Intrinsic Stock Options Exercise Price Life In Years Value Balance, February 29, 2020 7,996,056 Granted 2,167,775 $ 17.47 Exercised (1,182,099) $ 5.98 Forfeited (257,963) $ Balance, February 28, 2021 8,723,769 Granted 528,038 $ 47.74 Exercised (901,064) $ 9.37 Forfeited (304,951) $ 14.87 Balance, February 28, 2022 8,045,792 Granted 915,081 $ 8.06 Exercised (346,518) $ 5.45 Forfeited (563,836) $ 20.05 Balance, February 28, 2023 8,050,519 5.1 years $ 30,430 Vested and expected to vest as of February 28, 2023 7,893,273 $ 10.43 5.4 years $ 30,106 Exercisable as of February 28, 2023 6,581,769 $ 9.11 4.3 years $ 27,765 |
PlushCare, Inc. Stock Incentive Plan | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Schedule of stock option activity | In connection with the acquisition of PlushCare, the Company assumed all stock options that were awarded under the PlushCare Plan and that were outstanding as of the closing of the acquisition. These options were converted into options to purchase the Company’s common stock at a ratio determined in the purchase agreement. The Company has no intent to grant any further options under the PlushCare Plan beyond the options granted and outstanding as of the Company's acquisition of PlushCare. The following is a summary of stock option activity under the PlushCare Plan: Weighted Weighted average remaining Aggregate exercise contractual life intrinsic Stock Options price in years value Assumed, June 9, 2021 325,992 Exercised (50,506) $ 1.20 Forfeited (7,765) $ 2.88 Balance, February 28, 2022 267,721 Exercised (111,456) $ 1.65 Forfeited (2,657) $ 2.61 Balance, February 28, 2023 153,608 6.7 years $ 1,456 Vested and expected to vest as of February 28, 2023 124,666 $ 1.36 6.5 years $ 1,216 Exercisable as of February 28, 2023 95,519 $ 1.15 6.3 years $ 951 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Feb. 28, 2023 | |
Income Taxes | |
Schedule of components of loss before income taxes | Year Ended February 28, 2023 2022 2021 Domestic $ (463,848) $ (129,569) $ (50,934) Foreign 574 806 286 Total $ (463,274) $ (128,763) $ (50,648) |
Schedule of significant components of income taxes | Year Ended February 28, 2023 2022 2021 Current: Federal $ 156 $ 124 $ — State and Local 90 76 37 Foreign 127 202 141 Total Current 373 402 178 Deferred: Federal (1,638) (7,935) — State and Local (2,359) 1,941 — Foreign — (47) (174) Total deferred (3,997) (6,041) (174) Provision (benefit) for income taxes $ (3,624) $ (5,639) $ 4 |
Schedule of reconciliation of income tax expense at the U.S. Federal statutory income tax rate to actual income tax provision | Year Ended February 28, 2023 2022 2021 Federal income tax expense at statutory tax rate 21.0 % 21.0 % 21.0 % State income taxes, net of federal tax benefit 2.8 4.5 4.6 Change in state rate (2.1) — — Stock-based compensation (0.3) 0.8 (0.2) Transaction costs — (1.1) 0.0 Contingent consideration — 1.1 — Goodwill impairment (8.6) — — Changes in valuation allowances (11.9) (21.9) (25.4) Other (0.1) — — Effective Income Tax Rate 0.8 % 4.4 % 0.0 % |
Schedule of significant components of the Company's deferred tax assets and liabilities | February 28, 2023 2022 Deferred tax assets: Net operating loss and tax credit carryforwards $ 113,740 $ 114,272 Other accruals and reserves 5,599 5,210 Stock‑based compensation 32,741 16,353 Interest expense deduction limitation carryforward 3,092 3,082 Intangibles 6,248 — Property, plant & equipment 869 578 Capitalized research and development 10,931 — Lease liability 10,086 10,027 Other — 94 Valuation allowance (175,610) (125,810) Deferred tax assets 7,696 23,806 Deferred tax liabilities: Operating lease right-of-use assets (7,478) (8,494) Intangibles — (19,091) Deferred tax liabilities (7,478) (27,585) Net deferred taxes $ 218 $ (3,779) |
Schedule of changes in valuation allowance | Year Ending February 28, 2023 2022 Balance at the beginning of the period $ 125,810 $ 96,516 Increase due to NOLs and temporary differences 54,937 35,287 Decrease due to acquisitions (5,137) (5,993) Balance at the end of the period $ 175,610 $ 125,810 |
Net Loss Per Common Share (Tabl
Net Loss Per Common Share (Tables) | 12 Months Ended |
Feb. 28, 2023 | |
Net Income (Loss) Per Share Attributable to Common Stockholders | |
Schedule of computation of basic and diluted net loss per share | Year Ended February 28, 2023 2022 2021 Net loss $ (459,650) $ (123,124) $ (50,652) Net loss per common share, basic and diluted $ (6.45) $ (1.93) $ (1.72) Weighted‑average shares used to compute net loss per common share, basic and diluted 71,279,831 63,823,270 29,370,594 |
Schedule of common stock were excluded from the computation of diluted net loss per share attributable to common stockholders | Year Ended February 28, 2023 2022 2021 Stock options 8,204,127 8,313,513 8,723,769 Unvested restricted stock units 4,266,990 2,226,057 190,713 Shares issued to 2nd.MD employees and subject to vesting 274,224 326,801 — Shares issued to PlushCare employees and subject to vesting 537,401 806,161 — Contingent shares in connection with PlushCare acquisition 102,111 102,111 — Indemnity shares held in escrow in connection with PlushCare acquisition 27,342 27,342 — Shares to be issued to HealthReveal shareholders upon expiration of indemnification period 28,089 28,089 — Convertible Senior Notes 5,700,297 5,700,297 Total 19,140,581 17,530,371 8,914,482 |
Restructuring (Tables)
Restructuring (Tables) | 12 Months Ended |
Feb. 28, 2023 | |
Restructuring and Related Activities [Abstract] | |
Summary of the amount of severance costs included in the consolidated statements of operations | Year Ended February 28, 2023 Cost of revenue, excluding depreciation and amortization $ 1,025 Product and technology 2,149 Sales and marketing 1,948 General and administrative 1,943 Total severance costs $ 7,065 |
Summary of the changes in severance liabilities | Balance as of March 1, 2022 $ — Severance costs 7,065 Cash payments (3,069) Balance as of February 28, 2023 $ 3,996 |
Background - Initial Public Off
Background - Initial Public Offering (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |||
Oct. 26, 2020 | Jul. 07, 2020 | Feb. 28, 2023 | Feb. 28, 2021 | |
Subsidiary, Sale of Stock [Line Items] | ||||
Proceeds from public offerings, net of underwriters' discounts and commissions and offering costs | $ 439,410 | |||
Shares issued on conversion of convertible preferred stock | 29,479,521 | |||
Number of additional shares issued | 1,401,836 | |||
IPO | ||||
Subsidiary, Sale of Stock [Line Items] | ||||
Shares issued | 11,526,134 | |||
Share Price | $ 22 | |||
Proceeds from public offerings, net of underwriters' discounts and commissions and offering costs | $ 231,228 | |||
Offering Costs | $ 4,596 | |||
Number of additional shares issued | 1,401,836 | |||
Overallotment | ||||
Subsidiary, Sale of Stock [Line Items] | ||||
Shares issued | 750,000 | 1,503,408 | ||
Follow On Public Offering [Member] | ||||
Subsidiary, Sale of Stock [Line Items] | ||||
Shares issued | 5,750,000 | |||
Share Price | $ 38.50 | |||
Proceeds from public offerings, net of underwriters' discounts and commissions and offering costs | $ 208,046 | |||
Offering Costs | $ 600 |
Basis of Presentation and Sum_3
Basis of Presentation and Summary of Significant Accounting Policies - Basis of Presentation and Principles of Consolidation (Details) - USD ($) $ in Thousands | Feb. 28, 2023 | Feb. 28, 2022 |
Basis of Presentation and Summary of Significant Accounting Policies | ||
Assets | $ 903,069 | $ 1,285,529 |
Cash | 321,083 | 365,853 |
Accounts receivable | 23,435 | 21,116 |
Liabilities | 429,283 | $ 429,735 |
PC | ||
Basis of Presentation and Summary of Significant Accounting Policies | ||
Assets | 29,847 | |
Cash | 25,896 | |
Liabilities | 36,377 | |
PC | Amounts Due to Related Party [Member] | Related Party [Member] | ||
Basis of Presentation and Summary of Significant Accounting Policies | ||
Other Liabilities | $ 30,372 |
Basis of Presentation and Sum_4
Basis of Presentation and Summary of Significant Accounting Policies - Property and Equipment and Capitalized Internal Use Software Costs (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Feb. 28, 2023 | Feb. 28, 2022 | Feb. 28, 2021 | |
Property, Plant and Equipment [Line Items] | |||
Amortization expenses | $ 46,377 | $ 42,608 | $ 8,212 |
Office equipment and furniture | |||
Property, Plant and Equipment [Line Items] | |||
Useful life | 7 years | ||
Computer software | |||
Property, Plant and Equipment [Line Items] | |||
Useful life | 3 years | ||
Capitalized cost | $ 5,709 | 1,096 | 374 |
Amortization expenses | $ 1,196 | $ 2,387 | $ 4,560 |
Minimum | Computer equipment | |||
Property, Plant and Equipment [Line Items] | |||
Useful life | 3 years | ||
Minimum | Computer software | |||
Property, Plant and Equipment [Line Items] | |||
Useful life | 3 years | ||
Maximum | Computer equipment | |||
Property, Plant and Equipment [Line Items] | |||
Useful life | 5 years | ||
Maximum | Computer software | |||
Property, Plant and Equipment [Line Items] | |||
Useful life | 5 years |
Basis of Presentation and Sum_5
Basis of Presentation and Summary of Significant Accounting Policies - Concentration of Credit Risk (Details) - Customer Concentration Risk - Revenue [Member] | 12 Months Ended |
Feb. 28, 2021 | |
Total Customers | |
Concentration Risk [Line Items] | |
Revenue (as a percent) | 47.80% |
Customer 1 | |
Concentration Risk [Line Items] | |
Revenue (as a percent) | 16% |
Customer 2 | |
Concentration Risk [Line Items] | |
Revenue (as a percent) | 11.80% |
Customer 3 | |
Concentration Risk [Line Items] | |
Revenue (as a percent) | 10.20% |
Customer 4 | |
Concentration Risk [Line Items] | |
Revenue (as a percent) | 9.80% |
Basis of Presentation and Sum_6
Basis of Presentation and Summary of Significant Accounting Policies - Additional Information (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Feb. 28, 2023 | Feb. 28, 2022 | Feb. 28, 2021 | |
Impairment of Long Lived Assets | |||
Impairment charges | $ 0 | $ 0 | $ 0 |
Income Taxes | |||
Unrecognized benefits | 0 | 0 | 0 |
Additions, reductions, or settlements during the year for unrecognized benefits | 0 | 0 | $ 0 |
Operating lease right-of-use assets | 29,525 | $ 33,126 | |
Operating lease liabilities | $ 34,473 |
Revenue - Revenues disaggregate
Revenue - Revenues disaggregated (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Feb. 28, 2023 | Feb. 28, 2022 | |
Disaggregation of Revenue [Line Items] | ||
Revenue from Contract with Customer, Including Assessed Tax | $ 363,142 | $ 310,021 |
Access fees | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from Contract with Customer, Including Assessed Tax | 284,144 | 264,612 |
Utilization-based fees | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from Contract with Customer, Including Assessed Tax | $ 78,998 | $ 45,409 |
Revenue - Revenue and Deferred
Revenue - Revenue and Deferred Revenue (Details) $ in Thousands | Feb. 28, 2023 USD ($) |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue | $ 225,048 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-03-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue | $ 152,976 |
Revenue remaining performance obligation satisfaction period | 1 year |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2024-03-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue | $ 56,778 |
Revenue remaining performance obligation satisfaction period | 1 year |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2025-03-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue | $ 14,888 |
Revenue remaining performance obligation satisfaction period | 1 year |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2026-03-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue | $ 372 |
Revenue remaining performance obligation satisfaction period | 1 year |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2027-03-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue | $ 34 |
Revenue remaining performance obligation satisfaction period | 1 year |
Revenue - Revenue and Deferre_2
Revenue - Revenue and Deferred Revenue Narratives (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Feb. 28, 2023 | Feb. 28, 2022 | |
Revenue | ||
Contract with customer liability revenue recognized | $ 30,567 | $ 25,817 |
Revenue related to performance obligations satisfied in prior periods | $ 3,768 | $ 4,673 |
Revenue - Cost to obtain and fu
Revenue - Cost to obtain and fulfill a contract (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Feb. 28, 2023 | Feb. 28, 2022 | Feb. 28, 2021 | |
Capitalized Contract Cost [Line Items] | |||
Deferred amortization term | 5 years | ||
Deferred commissions, wrote off | $ 484 | ||
Impairment loss on deferred commission | 0 | $ 0 | $ 0 |
Selling And Marketing Expense [Member] | |||
Capitalized Contract Cost [Line Items] | |||
Amortization of contract cost | 2,695 | 2,080 | |
Impairment loss on deferred commission | 1,106 | ||
Sales commission | |||
Capitalized Contract Cost [Line Items] | |||
Amortization of contract cost | 3,478 | ||
Impairment loss on deferred commission | $ 6,016 | ||
Customer set up cost | |||
Capitalized Contract Cost [Line Items] | |||
Deferred amortization term | 5 years | ||
Amortization of contract cost | $ 1,002 | $ 865 | |
Impairment loss on deferred commission | 551 | ||
Deferred implementation costs | |||
Capitalized Contract Cost [Line Items] | |||
Amortization of contract cost | $ 1,303 | ||
Impairment loss on deferred commission | $ 1,154 |
Acquisitions - Summary of Purch
Acquisitions - Summary of Purchase Consideration (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jun. 09, 2021 | Mar. 03, 2021 | Feb. 28, 2022 | |
Consideration Paid | |||
Cash consideration, net of cash acquired | $ 259,996 | ||
Acquisition of 2nd.MD | |||
Consideration Paid | |||
Cash consideration, net of cash acquired | $ 226,135 | ||
Fair value of common stock issued | 116,187 | ||
Fair value of replacement awards | 1,520 | ||
Fair value of contingent consideration | 76,248 | ||
Total consideration paid | $ 420,090 | ||
PlushCare | |||
Consideration Paid | |||
Cash consideration, net of cash acquired | $ 33,860 | ||
Fair value of common stock issued | 330,338 | ||
Fair value of replacement awards | 5,209 | ||
Fair value of contingent consideration | 44,618 | ||
Total consideration paid | $ 414,025 |
Acquisitions - Shares Issued (D
Acquisitions - Shares Issued (Details) $ in Thousands | 1 Months Ended | 12 Months Ended | |||||||
Sep. 30, 2021 shares | Jun. 09, 2021 USD ($) shares | Mar. 03, 2021 USD ($) item shares | Sep. 30, 2021 shares | Feb. 28, 2023 USD ($) shares | Feb. 28, 2022 USD ($) | Feb. 28, 2021 USD ($) | Jan. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) | |
Business Acquisition [Line Items] | |||||||||
Revenue | $ 324,367 | $ 249,028 | |||||||
Net income (loss) | (137,644) | (142,392) | |||||||
Acquisition and integration-related costs | $ 1,218 | 13,219 | $ 2,050 | ||||||
Change in fair value of contingent consideration | $ (45,416) | ||||||||
Employees | |||||||||
Business Acquisition [Line Items] | |||||||||
Estimated fair value of replacement awards attributable to pre-acquisition services | $ 5,434 | ||||||||
Acquisition of 2nd.MD | |||||||||
Business Acquisition [Line Items] | |||||||||
Aggregate purchase price consideration | 420,090 | ||||||||
Cash consideration | 226,135 | ||||||||
Cash acquired | $ 205 | ||||||||
Shares issued during acquisition period | shares | 2,822,242 | 1,977,321 | |||||||
Shares fully vested upon acquisition | shares | 2,495,441 | ||||||||
Shares fully unvested upon acquisition | shares | 326,801 | 326,801 | |||||||
Number of earnout scenarios | item | 2 | ||||||||
Estimated fair value of replacement awards attributable to pre-acquisition services | $ 1,520 | ||||||||
Units issued | shares | 120,760 | ||||||||
Estimated fair value of replacement awards | $ 3,914 | ||||||||
Fair value of contingent consideration | $ 37,767 | ||||||||
Revenue | $ 48,753 | ||||||||
Net income (loss) | (32,353) | ||||||||
Equity Based Compensation Expense | $ 27,211 | ||||||||
Repayment of debt | $ 13,026 | ||||||||
Acquisition of 2nd.MD | Measurement Input Attrition Rate | |||||||||
Business Acquisition [Line Items] | |||||||||
Fair value of intangible assets, measurement input | 8 | ||||||||
Acquisition of 2nd.MD | Measurement Input Tax Rate | |||||||||
Business Acquisition [Line Items] | |||||||||
Fair value of intangible assets, measurement input | 24 | ||||||||
Acquisition of 2nd.MD | Measurement Input, Discount Rate | |||||||||
Business Acquisition [Line Items] | |||||||||
Fair value of intangible assets, measurement input | 13 | ||||||||
Acquisition of 2nd.MD | Measurement Input Royalty Rate | |||||||||
Business Acquisition [Line Items] | |||||||||
Fair value of intangible assets, measurement input | 1.5 | ||||||||
Acquisition of 2nd.MD | Measurement Input Probability of Completion Rate | |||||||||
Business Acquisition [Line Items] | |||||||||
Fair value of intangible assets, measurement input | 33 | ||||||||
Acquisition of 2nd.MD | Individuals Agreements With Company | |||||||||
Business Acquisition [Line Items] | |||||||||
Additional shares eligible to be received | shares | 281,531 | ||||||||
Vesting period | 2 years | ||||||||
Acquisition of 2nd.MD | Minimum | |||||||||
Business Acquisition [Line Items] | |||||||||
Amortization period | 3 years | ||||||||
Acquisition of 2nd.MD | Maximum | |||||||||
Business Acquisition [Line Items] | |||||||||
Shares issued during acquisition period | shares | 4,384,882 | ||||||||
Additional shares issued | shares | 2,170,972 | ||||||||
Amortization period | 20 years | ||||||||
PlushCare | |||||||||
Business Acquisition [Line Items] | |||||||||
Aggregate purchase price consideration | $ 414,025 | ||||||||
Cash consideration | 33,860 | $ 1,828 | |||||||
Cash acquired | 17,837 | ||||||||
Estimated fair value of replacement awards attributable to pre-acquisition services | $ 5,209 | ||||||||
Units issued | shares | 325,992 | ||||||||
Estimated fair value of replacement awards | $ 11,454 | ||||||||
Fair value of contingent consideration | $ 37,683 | ||||||||
Revenue | 44,393 | ||||||||
Net income (loss) | (15,396) | ||||||||
Equity Based Compensation Expense | $ 17,980 | ||||||||
Repayment of debt | $ 1,463 | ||||||||
Shares forfeited excluded from purchase price | shares | 806,161 | ||||||||
Shares issued subject to future vesting | shares | 854,717 | ||||||||
Cash issued upon achievement of defined revenue milestones | $ 2,000 | ||||||||
Additional shares issued | shares | 1,429,556 | 1,327,408 | |||||||
Additional Shares Issuable Withheld | shares | 102,111 | 102,111 | |||||||
PlushCare | Measurement Input Tax Rate | |||||||||
Business Acquisition [Line Items] | |||||||||
Fair value of intangible assets, measurement input | 25 | ||||||||
PlushCare | Measurement Input, Discount Rate | |||||||||
Business Acquisition [Line Items] | |||||||||
Fair value of intangible assets, measurement input | 12.5 | ||||||||
PlushCare | Measurement Input Royalty Rate | |||||||||
Business Acquisition [Line Items] | |||||||||
Fair value of intangible assets, measurement input | 3 | ||||||||
PlushCare | Employees | |||||||||
Business Acquisition [Line Items] | |||||||||
Estimated fair value of replacement awards attributable to pre-acquisition services | $ 16,663 | ||||||||
PlushCare | Minimum | |||||||||
Business Acquisition [Line Items] | |||||||||
Amortization period | 2 years | ||||||||
PlushCare | Minimum | Measurement Input Attrition Rate | |||||||||
Business Acquisition [Line Items] | |||||||||
Fair value of intangible assets, measurement input | 25 | ||||||||
PlushCare | Minimum | Measurement Input Probability of Completion Rate | |||||||||
Business Acquisition [Line Items] | |||||||||
Fair value of intangible assets, measurement input | 70 | ||||||||
PlushCare | Maximum | |||||||||
Business Acquisition [Line Items] | |||||||||
Shares issued during acquisition period | shares | 7,144,393 | ||||||||
Amortization period | 10 years | ||||||||
PlushCare | Maximum | Measurement Input Attrition Rate | |||||||||
Business Acquisition [Line Items] | |||||||||
Fair value of intangible assets, measurement input | 50 | ||||||||
PlushCare | Maximum | Measurement Input Probability of Completion Rate | |||||||||
Business Acquisition [Line Items] | |||||||||
Fair value of intangible assets, measurement input | 90 | ||||||||
HealthReveal | |||||||||
Business Acquisition [Line Items] | |||||||||
Shares issued subject to future vesting | shares | 28,089 | ||||||||
Additional shares issued | shares | 252,808 |
Acquisitions - Summary of Estim
Acquisitions - Summary of Estimated Fair Values of Assets Acquired and Liabilities Assumed (Details) - USD ($) $ in Thousands | 12 Months Ended | ||||
Jun. 09, 2021 | Mar. 03, 2021 | Feb. 28, 2023 | Feb. 28, 2022 | Feb. 28, 2021 | |
Assets acquired: | |||||
Goodwill | $ 278,191 | $ 577,896 | $ 4,013 | ||
PlushCare | |||||
Assets acquired: | |||||
Accounts receivable | $ 1,359 | ||||
Prepaid and other current assets | 573 | ||||
Property and equipment | 298 | ||||
Other noncurrent assets | 932 | ||||
Goodwill | 365,597 | ||||
Total assets acquired | 429,959 | ||||
Liabilities assumed | |||||
Accounts payable | 1,532 | ||||
Accrued expenses | 193 | ||||
Accrued compensation | 2,117 | ||||
Current portion of deferred revenue | 1,212 | ||||
Deferred tax liability | 9,992 | ||||
Other liabilities | 888 | ||||
Total liabilities assumed | 15,934 | ||||
Net assets acquired | $ 414,025 | ||||
Weighted-average useful life of intangible assets | 5 years | ||||
Decrease in recognized goodwill | $ 1,685 | ||||
PlushCare | Customer relationships | |||||
Assets acquired: | |||||
Intangible assets | 4,050 | ||||
PlushCare | Technology | |||||
Assets acquired: | |||||
Intangible assets | 40,650 | ||||
PlushCare | Trade name | |||||
Assets acquired: | |||||
Intangible assets | 10,300 | ||||
PlushCare | Non-compete agreement | |||||
Assets acquired: | |||||
Intangible assets | $ 6,200 | ||||
Acquisition of 2nd.MD | |||||
Assets acquired: | |||||
Accounts receivable | $ 5,550 | ||||
Unbilled revenue | 226 | ||||
Current portion of deferred contract acquisition costs | 176 | ||||
Prepaid and other current assets | 1,052 | ||||
Property and equipment | 4,344 | ||||
Deferred contract acquisition costs | 564 | ||||
Goodwill | 208,286 | ||||
Total assets acquired | 429,698 | ||||
Liabilities assumed | |||||
Accounts payable | 1,195 | ||||
Accrued expenses | 585 | ||||
Accrued compensation | 3,817 | ||||
Deferred rent and other current liabilities | 904 | ||||
Due to customers | 294 | ||||
Current portion of deferred revenue | 625 | ||||
Deferred rent and other noncurrent liabilities | 2,188 | ||||
Total liabilities assumed | 9,608 | ||||
Net assets acquired | $ 420,090 | ||||
Weighted-average useful life of intangible assets | 14 years | ||||
Decrease in recognized goodwill | $ 1,878 | ||||
Acquisition of 2nd.MD | Customer relationships | |||||
Assets acquired: | |||||
Intangible assets | $ 120,000 | ||||
Acquisition of 2nd.MD | Technology | |||||
Assets acquired: | |||||
Intangible assets | 58,000 | ||||
Acquisition of 2nd.MD | Supplier-based network | |||||
Assets acquired: | |||||
Intangible assets | 25,000 | ||||
Acquisition of 2nd.MD | Trade name | |||||
Assets acquired: | |||||
Intangible assets | 3,400 | ||||
Acquisition of 2nd.MD | Non-compete agreement | |||||
Assets acquired: | |||||
Intangible assets | $ 3,100 | ||||
HealthReveal | |||||
Liabilities assumed | |||||
Weighted-average useful life of intangible assets | 3 years | ||||
Decrease in recognized goodwill | $ 9,976 |
Goodwill and Intangible Asset_2
Goodwill and Intangible Assets - Carrying amount of goodwill (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Feb. 28, 2023 | Feb. 28, 2022 | Feb. 28, 2021 | |
Changes in the carrying amount of goodwill | |||
Balance,Beginning | $ 577,896 | $ 4,013 | |
Acquisitions | 573,883 | ||
Impairment | (299,705) | 0 | $ 0 |
Balance, Ending | $ 278,191 | $ 577,896 | $ 4,013 |
Goodwill and Intangible Asset_3
Goodwill and Intangible Assets (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||
Feb. 28, 2023 | Feb. 28, 2022 | Feb. 28, 2021 | |
Finite-Lived Intangible Assets [Line Items] | |||
Goodwill impairment | $ 299,705 | $ 0 | $ 0 |
Goodwill impairment charge, basic (in dollars per share) | $ 4.20 | ||
Goodwill impairment charge, diluted (in dollars per share) | $ 4.20 | ||
Impairment charges on intangible assets | $ 0 | ||
Discount rate for goodwill impairment test | 11% | ||
Goodwill impairment test for current revenue | 1.1 | ||
Goodwill impairment test for deferred revenue | 1.8 | ||
Excess of reporting unit fair value over carrying value | $ 0 | ||
Income-based approach | |||
Finite-Lived Intangible Assets [Line Items] | |||
Goodwill impairment test, percentage | 70% | ||
Market-based approach | |||
Finite-Lived Intangible Assets [Line Items] | |||
Goodwill impairment test, percentage | 30% |
Goodwill and Intangible Asset_4
Goodwill and Intangible Assets - Intangible assets (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Feb. 28, 2023 | Feb. 28, 2022 | Feb. 28, 2021 | |
Goodwill and Intangible Assets | |||
Gross Value | $ 283,576 | $ 283,576 | |
Accumulated Amortization | (80,374) | (38,886) | |
Net Carrying Value | 203,202 | 244,690 | |
Amortization expense for intangible assets | $ 41,488 | 36,590 | $ 1,450 |
Customer relationships | |||
Goodwill and Intangible Assets | |||
Useful Life | 17 years 10 months 24 days | ||
Gross Value | $ 124,050 | 124,050 | |
Accumulated Amortization | (15,353) | (7,444) | |
Net Carrying Value | $ 108,697 | 116,606 | |
Technology | |||
Goodwill and Intangible Assets | |||
Useful Life | 3 years | ||
Gross Value | $ 111,526 | 111,526 | |
Accumulated Amortization | (45,046) | (21,971) | |
Net Carrying Value | $ 66,480 | 89,555 | |
Supplier-based network | |||
Goodwill and Intangible Assets | |||
Useful Life | 3 years | ||
Gross Value | $ 25,000 | 25,000 | |
Accumulated Amortization | (10,000) | (5,000) | |
Net Carrying Value | $ 15,000 | 20,000 | |
Trade name | |||
Goodwill and Intangible Assets | |||
Useful Life | 8 years 2 months 12 days | ||
Gross Value | $ 13,700 | 13,700 | |
Accumulated Amortization | (2,483) | (1,112) | |
Net Carrying Value | $ 11,217 | 12,588 | |
Non-compete agreement | |||
Goodwill and Intangible Assets | |||
Useful Life | 8 months 12 days | ||
Gross Value | $ 9,300 | 9,300 | |
Accumulated Amortization | (7,492) | (3,359) | |
Net Carrying Value | $ 1,808 | $ 5,941 |
Goodwill and Intangible Asset_5
Goodwill and Intangible Assets - Amortization Expense (Details) - USD ($) $ in Thousands | Feb. 28, 2023 | Feb. 28, 2022 |
Goodwill and Intangible Assets | ||
Finite-Lived Intangible Asset, Expected Amortization, Year One | $ 37,795 | |
Finite-Lived Intangible Asset, Expected Amortization, Year Two | 34,143 | |
Finite-Lived Intangible Asset, Expected Amortization, Year Three | 32,125 | |
Finite-Lived Intangible Asset, Expected Amortization, Year Four | 9,403 | |
Finite-Lived Intangible Asset, Expected Amortization, Year Five | 7,370 | |
Finite-Lived Intangible Asset, Expected Amortization, after Year Five | 82,366 | |
Net Carrying Value | $ 203,202 | $ 244,690 |
Property and Equipment (Details
Property and Equipment (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Feb. 28, 2023 | Feb. 28, 2022 | Feb. 28, 2021 | |
Property, Plant and Equipment, Net, by Type [Abstract] | |||
Property and equipment, gross | $ 69,606 | $ 61,767 | |
Less accumulated depreciation | (54,843) | (49,970) | |
Property, Plant and Equipment, Net, Total | 14,763 | 11,797 | |
Depreciation and amortization expense | 4,889 | 6,018 | $ 6,762 |
Capitalized software development costs | |||
Property, Plant and Equipment, Net, by Type [Abstract] | |||
Property and equipment, gross | 39,097 | 33,388 | |
Computer software | |||
Property, Plant and Equipment, Net, by Type [Abstract] | |||
Property and equipment, gross | 6,026 | 6,023 | |
Computer equipment | |||
Property, Plant and Equipment, Net, by Type [Abstract] | |||
Property and equipment, gross | 12,363 | 10,518 | |
Write off of leasehold improvements and furniture/fixtures related to the termination of the Seattle lease | 328 | ||
Office equipment, furniture, and leasehold improvements | |||
Property, Plant and Equipment, Net, by Type [Abstract] | |||
Property and equipment, gross | $ 12,120 | $ 11,838 |
Leases - Components of operatin
Leases - Components of operating lease cost (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Feb. 28, 2023 | Feb. 28, 2022 | |
Operating lease cost | $ 7,575 | $ 7,169 |
Variable lease cost | 2,042 | 1,691 |
Total lease cost | $ 9,617 | $ 8,860 |
Maximum | ||
Remaining lease term | 7 years |
Leases - Cash Flow and Suppleme
Leases - Cash Flow and Supplemental Information (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Feb. 28, 2023 | Feb. 28, 2022 | |
Leases | ||
Operating cash flows from operating leases | $ 8,569 | $ 8,310 |
Right-of-use assets obtained in exchange for lease obligations | $ 2,170 | $ 3,564 |
Weighted-average remaining lease term (years) | 5 years 3 months 18 days | |
Weighted-average discount rate | 5% |
Leases - Future minimum lease p
Leases - Future minimum lease payments (Details) $ in Thousands | Feb. 28, 2023 USD ($) |
Leases | |
2024 | $ 8,849 |
2025 | 7,270 |
2026 | 7,303 |
2027 | 6,420 |
2028 | 3,665 |
Thereafter | 5,732 |
Total lease payments | 39,239 |
Less: Imputed interest | (4,766) |
Operating lease liabilities | $ 34,473 |
Term of Contract | 8 years |
Minimum fixed payments | $ 5,700 |
Accrued Expenses and Other Cu_3
Accrued Expenses and Other Current Liabilities (Details) - USD ($) $ in Thousands | Feb. 28, 2023 | Feb. 28, 2022 |
Accrued Expenses and Accrued Compensation | ||
Current portion of loans payable, net of unamortized issuance cost | $ 596 | $ 596 |
Professional and consulting fees | 1,992 | 2,661 |
Taxes | 528 | 769 |
Marketing | 347 | 1,492 |
Accrued litigation | 3,700 | 888 |
Software, hardware, and communication costs | 464 | 600 |
Payable related to acquisition earnout | 1,969 | |
Other | 4,117 | 2,025 |
Total | $ 11,744 | $ 11,000 |
Fair Value Measurements (Detail
Fair Value Measurements (Details) - USD ($) $ in Thousands | Feb. 28, 2023 | Feb. 28, 2022 |
Cash equivalents: | ||
Convertible senior notes | $ 221,346 | |
Money Market Funds | ||
Cash equivalents: | ||
Fair value | 99,861 | $ 131,527 |
Money Market Funds | Level 1 | ||
Cash equivalents: | ||
Fair value | 99,861 | 131,527 |
United States treasury bills | ||
Cash equivalents: | ||
Fair value | 39,995 | 99,999 |
United States treasury bills | Level 1 | ||
Cash equivalents: | ||
Fair value | $ 39,995 | $ 99,999 |
Fair Value Measurements - Level
Fair Value Measurements - Level 3 Contingent Consideration (Details) $ in Thousands | 12 Months Ended |
Feb. 28, 2023 USD ($) | |
Changes in the Company's Level 3 contingent consideration liabilities | |
Balance | $ 0 |
Incurred through acquisition | 120,866 |
Change in fair value | (45,416) |
Reclassification to equity and accrued expenses and other current liabilities | (75,450) |
Balance | $ 0 |
Debt (Details)
Debt (Details) $ / shares in Units, $ in Thousands | 1 Months Ended | 12 Months Ended | |||
Mar. 31, 2021 USD ($) $ / shares | Feb. 28, 2023 USD ($) $ / shares $ / derivative | Feb. 28, 2022 USD ($) | Feb. 28, 2021 USD ($) | Jul. 31, 2019 USD ($) | |
Debt Instrument [Line Items] | |||||
Line of credit | $ 1,208 | ||||
Repayment of principle portion of debt | $ 73,166 | ||||
Convertible Senior Notes | |||||
Debt Instrument [Line Items] | |||||
Debt instrument, face amount | $ 287,500 | ||||
Interest rate | 0.50% | ||||
Conversion rate | $ / shares | $ 19.8088 | $ 50.48 | |||
Principal amount denomination | $ 1 | ||||
Threshold percentage of stock price trigger | 130% | ||||
Threshold trading days | 20 | ||||
Threshold consecutive trading days | 30 | ||||
Percentage of principal amount redeemed | 100% | ||||
Cap price | $ / derivative | 76.20 | ||||
Proceeds from notes payable | $ 279,132 | ||||
Payment of costs of the capped call transactions | 34,443 | ||||
Cost which includes allocated pro-rata on capped call costs | 8,428 | ||||
Long-term debt | $ 287,500 | ||||
Outstanding debt | 282,323 | ||||
Debt issuance cost | 5,177 | ||||
Interest expenses | 3,094 | $ 2,857 | |||
Amortization of debt discount | $ 1,657 | 1,534 | |||
Amount allocated to capped call | $ 60 | ||||
Number of business day | 5 | ||||
Number of consecutive trading day | 10 | ||||
Percentage of average conversion value of note | 98% | ||||
Effective interest rate over period | 1.10% | ||||
Percentage of premium over last reported sale price | 100% | ||||
Amount allocated to the Notes | $ 8,368 | ||||
Revolving Credit Facility, 2019 | |||||
Debt Instrument [Line Items] | |||||
Maximum borrowing capacity | $ 80,000 | ||||
Long-term debt | $ 78,792 | ||||
Outstanding debt | 0 | ||||
Interest expenses | 203 | 296 | 1,106 | ||
Deferred financing fees | 0 | $ 93 | $ 279 | ||
Revolving Credit Facility, 2019 | Minimum | |||||
Debt Instrument [Line Items] | |||||
Threshold net cash for extension of debt term | $ 200,000 | ||||
Revolving Credit Facility, 2019 | Bloomberg Short-Term Bank Yield Index | |||||
Debt Instrument [Line Items] | |||||
Debt instrument variable rate | 350% | ||||
Revolving Credit Facility, 2019 | BSBY Rate and Base Rate | |||||
Debt Instrument [Line Items] | |||||
Debt instrument variable rate | 250% |
Debt - Notes (Details)
Debt - Notes (Details) - Convertible Senior Notes $ in Thousands | Feb. 28, 2023 USD ($) |
Debt Instrument [Line Items] | |
Principal | $ 287,500 |
Unamortized issuance costs | (5,177) |
Net carrying amount | $ 282,323 |
Stockholders Equity (Deficit) -
Stockholders Equity (Deficit) - Common Stock (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |||
Oct. 26, 2020 | Jul. 07, 2020 | Feb. 28, 2023 | Feb. 28, 2021 | |
Class of Stock [Line Items] | ||||
Net proceeds from offerings | $ 439,410 | |||
Number of additional shares issued | 1,401,836 | |||
IPO | ||||
Class of Stock [Line Items] | ||||
New common stock issued and sold | 11,526,134 | |||
Common stock issue price per share | $ 22 | |||
Net proceeds from offerings | $ 231,228 | |||
Number of additional shares issued | 1,401,836 | |||
Follow-on offering | ||||
Class of Stock [Line Items] | ||||
New common stock issued and sold | 5,750,000 | |||
Common stock issue price per share | $ 38.50 | |||
Net proceeds from offerings | $ 208,046 |
Stockholders Equity (Deficit)_2
Stockholders Equity (Deficit) - Convertible Preferred Stock (Details) - shares | Feb. 28, 2023 | Feb. 28, 2022 | Feb. 28, 2021 | Jul. 31, 2020 | Jul. 07, 2020 |
Class of Stock [Line Items] | |||||
Shares issued on conversion of convertible preferred stock | 29,479,521 | ||||
Convertible Preferred stock | |||||
Class of Stock [Line Items] | |||||
Preferred stock, shares outstanding | 0 | 0 | 0 | ||
Shares issued on conversion of convertible preferred stock | 29,479,521 |
Equity-based Compensation - Sto
Equity-based Compensation - Stock-based compensation expense (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Feb. 28, 2023 | Feb. 28, 2022 | Feb. 28, 2021 | |
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | |||
Compensation expense | $ 72,644 | $ 72,939 | $ 9,576 |
Cost of revenue, excluding depreciation and amortization | |||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | |||
Compensation expense | 4,794 | 3,197 | 948 |
Product and technology | |||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | |||
Compensation expense | 24,995 | 18,744 | 3,387 |
REPLACED Sales and marketing | |||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | |||
Compensation expense | 17,275 | 12,822 | 2,376 |
General and administrative | |||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | |||
Compensation expense | 25,580 | 38,176 | 2,865 |
Stock Option | |||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | |||
Compensation expense | $ 11,798 | $ 10,374 | $ 7,743 |
Equity-based Compensation - S_2
Equity-based Compensation - Stock Options (Narrative) (Details) - USD ($) $ / shares in Units, $ in Thousands | 1 Months Ended | 12 Months Ended | |||
Jul. 31, 2020 | Jun. 30, 2020 | Feb. 28, 2023 | Feb. 28, 2022 | Feb. 28, 2021 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Compensation expense | $ 72,644 | $ 72,939 | $ 9,576 | ||
Stock options issued value | $ 5,735 | ||||
Maximum | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Weighted average grant date fair value | $ 8.54 | $ 31.95 | $ 31.27 | ||
Stock Option | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Compensation expense | $ 11,798 | $ 10,374 | $ 7,743 | ||
Weighted average grant date fair value | $ 5.10 | $ 28.59 | $ 11.42 | ||
Aggregate intrinsic value of stock options | $ 1,801 | $ 29,964 | $ 32,972 | ||
Unrecognized compensation expense | $ 13,959 | ||||
Weighted average period | 1 year 8 months 12 days | ||||
Stock options issued value | $ 5,735 | ||||
Stock options issued | 525,907 | ||||
2020 Equity Incentive Plan | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Common stock authorized to be issued | 9,211,901 | ||||
Common stock available for future grants | 1,488,576 | ||||
2020 Equity Incentive Plan | Stock Option | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Term of option | 10 years | ||||
Vesting period | 4 years | ||||
2020 Equity Incentive Plan | Stock Option | Maximum | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Common stock authorized to be issued | 4,300,000 | ||||
2020 Equity Incentive Plan | Stock Option | Tranche One | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Vesting period | 1 year | ||||
Vesting percentage | 25% | ||||
2020 Equity Incentive Plan | Stock Option | Tranche Two | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Vesting period | 3 years | ||||
PlushCare, Inc. Stock Incentive Plan | Stock Option | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Compensation expense | $ 4,367 | 4,161 | |||
Aggregate intrinsic value of stock options | 1,127 | $ 1,596 | |||
Unrecognized compensation expense | $ 2,707 | ||||
Weighted average period | 1 year 4 months 24 days |
Equity-based Compensation - Wei
Equity-based Compensation - Weighted average grant date fair value of stock options granted (Details) - $ / shares | 12 Months Ended | ||
Feb. 28, 2023 | Feb. 28, 2022 | Feb. 28, 2021 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Expected term (in years) | 6 years 29 days | ||
Maximum | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Estimated fair value of common stock | $ 8.54 | $ 31.95 | $ 31.27 |
Exercise price | $ 14.05 | $ 53.38 | $ 50.88 |
Expected volatility | 70% | 68% | 78% |
Expected term (in years) | 6 years 3 months | ||
Riskfree interest rate | 4.14% | 1.39% | 0.64% |
Minimum | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Estimated fair value of common stock | $ 5.13 | $ 13.59 | $ 9.62 |
Exercise price | $ 8.03 | $ 23.50 | $ 15.40 |
Expected volatility | 64% | 63% | 68% |
Expected term (in years) | 6 years 29 days | 5 years | |
Riskfree interest rate | 2.71% | 1.29% | 0.30% |
Equity-based Compensation - S_3
Equity-based Compensation - Stock Option Activity Under Option Plan and Incentive Plan (Details) - USD ($) $ / shares in Units, $ in Thousands | 9 Months Ended | 12 Months Ended | ||
Feb. 28, 2022 | Feb. 28, 2023 | Feb. 28, 2022 | Feb. 28, 2021 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward] | ||||
Beginning Balance | 8,045,792 | 8,723,769 | 7,996,056 | |
Granted | 915,081 | 528,038 | 2,167,775 | |
Exercised | (346,518) | (901,064) | (1,182,099) | |
Forfeited | (563,836) | (304,951) | (257,963) | |
Ending Balance | 8,045,792 | 8,050,519 | 8,045,792 | 8,723,769 |
Vested and expected to vest as of May 31, 2022 | 7,893,273 | |||
Exercisable as of May 31, 2022 | 6,581,769 | |||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price [Abstract] | ||||
Granted | $ 8.06 | $ 47.74 | $ 17.47 | |
Exercised | 5.45 | 9.37 | $ 5.98 | |
Forfeited | 20.05 | $ 14.87 | ||
Exercisable as of May 31, 2022 (in USD per share) | 9.11 | |||
Vested and expected to vest as of May 31, 2022 (in USD per share) | $ 10.43 | |||
Weighted remaining contractual life in years | 5 years 1 month 6 days | |||
Vested and expected to vest as of May 31, 2022 (in years) | 5 years 4 months 24 days | |||
Exercisable as of May 31, 2022 (in years) | 4 years 3 months 18 days | |||
Ending Balance | $ 30,430 | |||
Vested and expected to vest as of May 31, 2022 | 30,106 | |||
Exercisable as of May 31, 2022 | $ 27,765 | |||
PlushCare, Inc. Stock Incentive Plan | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward] | ||||
Beginning Balance | 325,992 | 267,721 | ||
Exercised | (50,506) | (111,456) | ||
Forfeited | (7,765) | (2,657) | ||
Ending Balance | 267,721 | 153,608 | 267,721 | |
Vested and expected to vest as of May 31, 2022 | 124,666 | |||
Exercisable as of May 31, 2022 | 95,519 | |||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price [Abstract] | ||||
Exercised | $ 1.20 | $ 1.65 | ||
Forfeited | $ 2.88 | 2.61 | ||
Exercisable as of May 31, 2022 (in USD per share) | 1.15 | |||
Vested and expected to vest as of May 31, 2022 (in USD per share) | $ 1.36 | |||
Weighted remaining contractual life in years | 6 years 8 months 12 days | |||
Vested and expected to vest as of May 31, 2022 (in years) | 6 years 6 months | |||
Exercisable as of May 31, 2022 (in years) | 6 years 3 months 18 days | |||
Ending Balance | $ 1,456 | |||
Vested and expected to vest as of May 31, 2022 | 1,216 | |||
Exercisable as of May 31, 2022 | $ 951 |
Equity-based Compensation - Res
Equity-based Compensation - Restricted Stock Units (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | ||||
Feb. 28, 2023 | Aug. 31, 2022 | Aug. 31, 2021 | Feb. 28, 2023 | Feb. 28, 2022 | Feb. 28, 2021 | |
Summary of activity | ||||||
Compensation expense | $ 72,644 | $ 72,939 | $ 9,576 | |||
Maximum | ||||||
Summary of activity | ||||||
Weighted average grant date fair value | $ 8.54 | $ 31.95 | $ 31.27 | |||
Time-based restricted stock units | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Units issued | 4,470,526 | 2,257,433 | 191,415 | |||
Summary of activity | ||||||
Beginning Balance | 2,226,057 | 190,713 | ||||
Granted | 4,470,526 | 2,257,433 | 191,415 | |||
Vested | (1,667,550) | (87,574) | (702) | |||
Forfeited | (762,043) | (134,515) | ||||
Ending Balance | 4,266,990 | 4,266,990 | 2,226,057 | 190,713 | ||
Compensation expense | $ 32,356 | $ 23,309 | $ 842 | |||
Remaining of total unrecognized compensation costs | $ 61,274 | $ 61,274 | ||||
Weighted average period | 2 years 3 months 18 days | |||||
Weighted average grant date fair value | $ 8.76 | $ 44.40 | $ 46.52 | |||
Time-based restricted stock units | PlushCare | ||||||
Summary of activity | ||||||
Number of shares issued in connection with the acquisition to the existing shareholders | 64,694 | |||||
Non option equity instruments | 57,124 | |||||
Time-based restricted stock units | Tranche One | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Vesting percentage | 12.50% | |||||
Individuals Agreements With Company | Acquisition of 2nd.MD | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Vesting period | 2 years | |||||
Summary of activity | ||||||
Ending Balance | 241,614 | 241,614 | ||||
Compensation expense | $ 4,015 | $ 23,138 | ||||
Weighted average grant date fair value | $ 46.56 | |||||
Shares Eligible To Be Received By Individuals Of Company With Continued Employment | 608,332 | |||||
Additional Shares Eligible To Be Received By Individuals Of Company, Upon Achievement Of Contingent Consideration Milestones | 281,531 | |||||
Shares eligible to receive subject to service requirements | 256,418 | |||||
Separation and transition agreement expenses | $ 8,981 | |||||
Individuals Agreements With Company | PlushCare | ||||||
Summary of activity | ||||||
Ending Balance | 537,401 | 537,401 | ||||
Compensation expense | $ 14,113 | $ 10,208 | ||||
Unamortized compensation expense | $ 18,018 | |||||
Unamortized Compensation Expense, Weighted Average Remaining Period | 1 year 3 months 18 days | |||||
Weighted average grant date fair value | $ 52.52 | |||||
Shares Eligible To Be Received By Individuals Of Company With Continued Employment | 806,161 | |||||
Individuals Agreements With Company | Tranche One | Acquisition of 2nd.MD | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Vesting percentage | 50% | |||||
Individuals Agreements With Company | Tranche One | PlushCare | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Vesting percentage | 33.33% | |||||
Individuals Agreements With Company | Tranche Two | Acquisition of 2nd.MD | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Vesting percentage | 50% | |||||
Individuals Agreements With Company | Tranche Two | PlushCare | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Vesting percentage | 33.33% | |||||
Individuals Agreements With Company | Tranche Three | PlushCare | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Vesting percentage | 33.34% | |||||
Restricted stock units 2023 Bonus plan payout | ||||||
Summary of activity | ||||||
Compensation expense | $ 4,663 | |||||
Share-Based Compensation Arrangement by Share-Based Payment Award, Additional Number of Shares Approved | 753,259 | |||||
Time Based Restricted Stock Units Granted for Two Years [Member] | Tranche One | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Vesting period | 2 years | |||||
Time Based Restricted Stock Units Granted for Two Years [Member] | Tranche One | Maximum | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Vesting period | 4 years | |||||
Time Based Restricted Stock Units Granted for Three Years [Member] | Tranche Two | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Vesting period | 3 years | |||||
Time Based Restricted Stock Units Granted for Four Years [Member] | Tranche Three | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Vesting period | 4 years |
Equity-based Compensation - Emp
Equity-based Compensation - Employee Stock Purchase Plan - (Details) - USD ($) $ in Thousands | 1 Months Ended | 12 Months Ended | ||||
Mar. 01, 2021 | Jul. 31, 2020 | Feb. 28, 2023 | Feb. 28, 2022 | Feb. 28, 2021 | Aug. 31, 2020 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Compensation expense | $ 72,644 | $ 72,939 | $ 9,576 | |||
2020 Employee Stock Purchase Plan | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Common stock initially reserved | 1,100,000 | |||||
Number of automatic annual increase in common share | 2,327,976 | |||||
Percentage of lower in fair market value | 85% | |||||
Compensation expense | $ 1,332 | $ 1,749 | $ 991 | |||
Issuance of common stock in connection with the employee stock purchase plan (shares) | 560,345 | 140,838 | 67,498 | |||
Proceeds from Stock Plans | $ 2,927 | $ 4,309 | $ 1,259 | |||
Additional amount withheld for future participation | $ 1,384 | |||||
Maximum | 2020 Employee Stock Purchase Plan | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Percentage of employee contribution on compensation | 15% | |||||
Participant accrued purchase rights | $ 25,000 |
Defined Contribution Retireme_2
Defined Contribution Retirement Plan - Additional Information (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Feb. 28, 2023 | Feb. 28, 2022 | Feb. 28, 2021 | |
Defined Contribution Retirement Plan | |||
Maximum annual contributions per employee (as a percent) | 3.50% | ||
Maximum annual contributions per employee | $ 100 | ||
Number of years of service during which employers matching contributions vests | 4 years | ||
Number of years of service during which employers discretionary profit sharing contributions vests | 4 years | ||
Expenses related to matching contributions | $ 3,231 | $ 2,278 | $ 1,599 |
Income Taxes - Components of lo
Income Taxes - Components of loss before income taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Feb. 28, 2023 | Feb. 28, 2022 | Feb. 28, 2021 | |
Income Taxes | |||
Domestic | $ (463,848) | $ (129,569) | $ (50,934) |
Foreign | 574 | 806 | 286 |
Loss before income taxes | $ (463,274) | $ (128,763) | $ (50,648) |
Income Taxes - Significant comp
Income Taxes - Significant components of income taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Feb. 28, 2023 | Feb. 28, 2022 | Feb. 28, 2021 | |
Currently payable: | |||
Federal | $ 156 | $ 124 | |
State and Local | 90 | 76 | $ 37 |
Foreign | 127 | 202 | 141 |
Total currently payable | 373 | 402 | 178 |
Deferred: | |||
Federal | (1,638) | (7,935) | |
State and Local | (2,359) | 1,941 | |
Foreign | (47) | (174) | |
Total deferred | (3,997) | (6,041) | (174) |
Provision (benefit) for income taxes | $ (3,624) | $ (5,639) | $ 4 |
Income Taxes - Reconciliation o
Income Taxes - Reconciliation of income tax expense at U.S. Federal statutory income tax rate (Details) | 12 Months Ended | ||
Feb. 28, 2023 | Feb. 28, 2022 | Feb. 28, 2021 | |
Income Taxes | |||
Federal income tax expense at statutory tax rate | 21% | 21% | 21% |
State income taxes, net of federal tax benefit | 2.80% | 4.50% | 4.60% |
Change in state rate | (2.10%) | ||
Stock based compensation | (0.30%) | 0.80% | (0.20%) |
Transaction costs | 1.10% | (0.00%) | |
Contingent consideration | 1.10% | ||
Goodwill impairment | (8.60%) | ||
Changes in valuation allowances | (11.90%) | (21.90%) | (25.40%) |
Other | (0.10%) | ||
Effective Income Tax Rate | 0.80% | 4.40% | 0% |
Income Taxes - Significant co_2
Income Taxes - Significant components of the Company's deferred tax assets and liabilities (Details) - USD ($) $ in Thousands | Feb. 28, 2023 | Feb. 28, 2022 | Feb. 28, 2021 |
Deferred tax assets: | |||
Net operating loss and tax credit carryforwards | $ 113,740 | $ 114,272 | |
Other accruals and reserves | 5,599 | 5,210 | |
Stockbased compensation | 32,741 | 16,353 | |
Interest expense deduction limitation carryforward | 3,092 | 3,082 | |
Intangibles | 6,248 | ||
Property, plant & equipment | 869 | 578 | |
Capitalized research and development | 10,931 | ||
Lease liability | 10,086 | 10,027 | |
Other | 94 | ||
Valuation allowance | (175,610) | (125,810) | $ (96,516) |
Deferred tax assets | 7,696 | 23,806 | |
Deferred tax liabilities: | |||
Intangibles | (19,091) | ||
Operating lease right-of-use assets | (7,478) | (8,494) | |
Deferred tax liabilities | (7,478) | (27,585) | |
Net deferred taxes | $ 218 | ||
Net deferred taxes | $ (3,779) |
Income Taxes - Operating loss c
Income Taxes - Operating loss carryforwards (Narrative) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Feb. 28, 2023 | Feb. 28, 2022 | Feb. 28, 2021 | |
Operating Loss Carryforwards [Line Items] | |||
Operating loss carryforwards subject to expiration until 2030 | $ 0 | ||
Deferred tax asset for operating loss carryforwards expiring in years 2030 through 2037 | 59,213 | ||
Deferred tax asset for operating loss carryforwards that have indefinite expiration | $ 54,101 | ||
Income tax expense | (3,624) | (5,639) | $ 4 |
U.S. federal | |||
Operating Loss Carryforwards [Line Items] | |||
Net operating loss carryforwards | 453,323 | 422,481 | |
U.S. states | |||
Operating Loss Carryforwards [Line Items] | |||
Net operating loss carryforwards | 402,376 | $ 372,975 | |
Research and development | |||
Operating Loss Carryforwards [Line Items] | |||
Tax credit carryforwards | $ 432 |
Income Taxes - Changes in defer
Income Taxes - Changes in deferred tax, valuation allowance (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Feb. 28, 2023 | Feb. 28, 2022 | |
Changes in deferred tax, valuation allowance | ||
Balance at the beginning of the period | $ 125,810 | $ 96,516 |
Increase due to NOLs and temporary differences | 54,937 | 35,287 |
Increase due to acquisitions | (5,137) | (5,993) |
Balance at the end of the period | $ 175,610 | $ 125,810 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Feb. 28, 2023 | Feb. 28, 2022 | Feb. 28, 2021 | |
Income Taxes | |||
Federal income tax expense at statutory tax rate | 21% | 21% | 21% |
Deferred Tax Asset, Interest Carryforward | $ 3,092 | $ 3,082 | |
Reversal of Deferred Tax Liability | 3,899 | ||
Deferred Tax Asset, Interest Carryforward | $ 3,092 | $ 3,082 |
Net Loss Per Common Share (Deta
Net Loss Per Common Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||
Feb. 28, 2023 | Feb. 28, 2022 | Feb. 28, 2021 | |
Net Income (Loss) Per Share Attributable to Common Stockholders | |||
Net income (loss) | $ (459,650) | $ (123,124) | $ (50,652) |
Weighted-average common shares outstanding, basic | 71,279,831 | 63,823,270 | 29,370,594 |
Weighted-average common shares outstanding, diluted | 71,279,831 | 63,823,270 | 29,370,594 |
Net income (loss) per share attributable to common stockholders, basic | $ (6.45) | $ (1.93) | $ (1.72) |
Net income (loss) per share attributable to common stockholders, diluted | $ (6.45) | $ (1.93) | $ (1.72) |
Net Loss Per Common Share - Ant
Net Loss Per Common Share - Antidilutive (Details) - shares | 12 Months Ended | ||
Feb. 28, 2023 | Feb. 28, 2022 | Feb. 28, 2021 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Antidilutive securities excluded from computation of diluted net loss per share | 19,140,581 | 17,530,371 | 8,914,482 |
Stock Option | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Antidilutive securities excluded from computation of diluted net loss per share | 8,204,127 | 8,313,513 | 8,723,769 |
Unvested restricted stock units | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Antidilutive securities excluded from computation of diluted net loss per share | 4,266,990 | 2,226,057 | 190,713 |
Shares issued to 2nd.MD employees and subject to vesting | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Antidilutive securities excluded from computation of diluted net loss per share | 274,224 | 326,801 | |
Contingent shares in connection with acquisition | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Antidilutive securities excluded from computation of diluted net loss per share | 102,111 | 102,111 | |
Shares issued to PlushCare employees and subject to vesting | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Antidilutive securities excluded from computation of diluted net loss per share | 537,401 | 806,161 | |
Indemnity shares held in escrow in connection with PlushCare acquisition | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Antidilutive securities excluded from computation of diluted net loss per share | 27,342 | 27,342 | |
Shares to be issued to HealthReveal shareholders upon expiration of indemnification | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Antidilutive securities excluded from computation of diluted net loss per share | 28,089 | 28,089 | |
Convertible Senior Notes | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Antidilutive securities excluded from computation of diluted net loss per share | 5,700,297 | 5,700,297 |
Commitments and Contingencies -
Commitments and Contingencies - Legal Proceedings (Details) $ in Thousands | 12 Months Ended |
Feb. 28, 2023 USD ($) | |
Commitments and Contingencies. | |
Accruals related to legal matters | $ 3,700 |
Remaining amount recorded in general and administrative expenses | $ 1,218 |
Commitments and Contingencies_2
Commitments and Contingencies - Purchase Obligations (Details) $ in Thousands | Feb. 28, 2023 USD ($) |
Commitments and Contingencies. | |
Purchase Obligation | $ 40,323 |
Purchase obligation, remaining future purchase commitments | $ 31,995 |
Related Party Transactions (Det
Related Party Transactions (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Feb. 28, 2021 | Feb. 28, 2023 | Feb. 28, 2022 | |
Related Party [Member] | |||
Related Party Transaction [Line Items] | |||
Revenues | $ 27,300 | ||
Minimum | |||
Related Party Transaction [Line Items] | |||
Percentage of Company's outstanding stock owned by entities affiliated with one of the Company's significant customers | 5% | 5% | 5% |
Restructuring - Severance Costs
Restructuring - Severance Costs (Details) $ in Thousands | 12 Months Ended |
Feb. 28, 2023 USD ($) | |
Restructuring Cost and Reserve [Line Items] | |
Severance Costs | $ 7,065 |
Cost of revenue, excluding depreciation and amortization | |
Restructuring Cost and Reserve [Line Items] | |
Severance Costs | 1,025 |
Product and technology | |
Restructuring Cost and Reserve [Line Items] | |
Severance Costs | 2,149 |
Selling And Marketing Expense [Member] | |
Restructuring Cost and Reserve [Line Items] | |
Severance Costs | 1,948 |
General and administrative | |
Restructuring Cost and Reserve [Line Items] | |
Severance Costs | $ 1,943 |
Restructuring - Severance Liabi
Restructuring - Severance Liability (Details) $ in Thousands | 12 Months Ended |
Feb. 28, 2023 USD ($) | |
Restructuring Reserve [Roll Forward] | |
Severance Costs | $ 7,065 |
Cash payments | (3,069) |
Balance at end of period | $ 3,996 |