Cover Page
Cover Page - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Apr. 13, 2023 | Jun. 30, 2022 | |
Cover [Abstract] | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Period End Date | Dec. 31, 2022 | ||
Current Fiscal Year End Date | --12-31 | ||
Document Transition Report | false | ||
Entity File Number | 001-37792 | ||
Entity Registrant Name | NantHealth, Inc. | ||
Entity Incorporation, State or Country Code | DE | ||
Entity Tax Identification Number | 27-3019889 | ||
Entity Address, Address Line One | 3000 RDU Center Drive, Suite 200 | ||
Entity Address, Postal Zip Code | 27500 | ||
Entity Address, City or Town | Morrisville, | ||
Entity Address, State or Province | NC | ||
City Area Code | 855) | ||
Local Phone Number | 949-6268 | ||
Title of 12(b) Security | Common Stock, par value $0.0001 per share | ||
Trading Symbol | NH | ||
Security Exchange Name | NASDAQ | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Non-accelerated Filer | ||
Entity Small Business | true | ||
Entity Emerging Growth Company | false | ||
ICFR Auditor Attestation Flag | false | ||
Entity Shell Company | false | ||
Entity Public Float | $ 23.5 | ||
Entity Common Stock, Shares Outstanding | 7,703,304 | ||
Documents Incorporated by Reference | As noted herein, the information called for by Part III is incorporated by reference to specified portions of the Registrant’s definitive proxy statement to be filed in conjunction with the Registrant’s 2023 Annual Meeting of Stockholders, which is expected to be filed not later than 120 days after the Registrant’s fiscal year ended December 31, 2022. | ||
Entity Central Index Key | 0001566469 | ||
Document Fiscal Year Focus | 2022 | ||
Document Fiscal Period Focus | FY | ||
Amendment Flag | false |
Audit Information
Audit Information | 12 Months Ended |
Dec. 31, 2022 | |
Auditor Information [Abstract] | |
Auditor Firm ID | 42 |
Auditor Name | Ernst & Young LLP |
Auditor Location | Los Angeles, California |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 | |
Current assets | |||
Cash and cash equivalents | $ 1,759 | $ 29,084 | |
Accounts receivable, net | 5,948 | 5,810 | |
Related party receivables, net | 476 | 506 | |
Prepaid expenses and other current assets | 4,402 | 4,010 | |
Total current assets | 12,585 | 39,410 | |
Property, plant, and equipment, net | 12,383 | 12,366 | |
Goodwill | 98,333 | 98,333 | |
Intangible assets, net | 30,110 | 39,039 | |
Related party receivable, net of current | 937 | 1,012 | |
Operating lease right-of-use assets | 4,285 | 6,048 | |
Other assets | 918 | 1,620 | |
Total assets | 159,551 | 197,828 | |
Current liabilities | |||
Accounts payable | 10,408 | 3,204 | |
Accrued and other current liabilities | 20,006 | 16,358 | |
Deferred revenue | 2,724 | 2,440 | |
Related party payables, net | 1,933 | 5,161 | |
Notes payable | 560 | 782 | |
Total current liabilities | 35,631 | 27,945 | |
Deferred revenue, net of current | 1,050 | 2,024 | |
Related party liabilities | 45,908 | 38,278 | |
Related party promissory note | 123,666 | 112,666 | |
Related party convertible note, net | 62,335 | 62,268 | |
Convertible notes, net | 74,683 | 74,603 | |
Deferred income taxes, net | 1,206 | 1,775 | |
Operating lease liabilities | 4,054 | 6,248 | |
Other liabilities | 36,411 | 34,013 | |
Total liabilities | 384,944 | 359,820 | |
Commitments and Contingencies (Note 14) | |||
Stockholders' deficit | |||
Common stock, $0.0001 par value per share, 750,000,000 shares authorized; 7,703,306 and 7,700,349 shares issued and outstanding at December 31, 2022 and 2021, respectively | [1] | 12 | 12 |
Additional paid-in capital | 895,897 | 891,105 | |
Accumulated income (deficit) | (1,120,676) | (1,052,897) | |
Accumulated other comprehensive income (loss) | (626) | (212) | |
Total stockholders' equity (deficit) | (225,393) | (161,992) | |
Total liabilities and stockholders' equity (deficit) | $ 159,551 | $ 197,828 | |
[1]Reflects the 1-for-15 reverse stock split that became effective December 16, 2022. Refer to Note 1. |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) | Dec. 31, 2022 $ / shares shares | Dec. 31, 2021 $ / shares shares |
Statement of Financial Position [Abstract] | ||
Common stock, par value (usd per share) | $ / shares | $ 0.0001 | $ 0.0001 |
Common stock authorized (in shares) | 750,000,000 | 750,000,000 |
Common stock issued (in shares) | 7,703,306 | 7,700,349 |
Common stock outstanding (in shares) | 7,703,306 | 7,700,349 |
Consolidated Statements of Oper
Consolidated Statements of Operations $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 USD ($) $ / shares shares | Dec. 31, 2021 USD ($) $ / shares shares | ||
Revenue | |||
Net revenue | $ 67,002 | $ 62,649 | |
Cost of Revenue | |||
Total cost of revenue | 28,839 | 27,807 | |
Gross Profit | 38,163 | 34,842 | |
Operating Expenses | |||
Selling, general and administrative | 62,501 | 52,092 | |
Research and development | 23,047 | 19,707 | |
Amortization of acquisition-related assets | 3,942 | 3,942 | |
Total operating expenses | 89,490 | 75,741 | |
Income (loss) from operations | (51,327) | (40,899) | |
Interest expense, net | (14,119) | (14,481) | |
Other expense, net | (2,650) | (3,089) | |
Income (loss) from continuing operations before income taxes | (68,096) | (58,469) | |
(Provision for) benefit from income taxes | (317) | 97 | |
Net income (loss) from continuing operations | (67,779) | (58,566) | |
Income (loss) from discontinued operations, net of tax, attributable to NantHealth | 0 | 23 | |
Net income (loss) | (67,779) | (58,543) | |
Net income (loss) attributable to noncontrolling interests | 0 | (284) | |
Net income (loss) attributable to NantHealth | $ (67,779) | $ (58,259) | |
Earnings Per Share [Abstract] | |||
Continuing operations - common stock per basic share (usd per share) | $ / shares | $ (8.80) | $ (7.66) | |
Continuing operations - common stock per diluted share (usd per share) | $ / shares | (8.80) | (7.66) | |
Total net income (loss) per share - common stock, diluted (usd per share) | $ / shares | (8.80) | (7.66) | |
Total net income (loss) per share - common stock, basic (usd per share) | $ / shares | $ (8.80) | $ (7.66) | |
Weighted average shares outstanding | |||
Basic - common stock (in shares) | shares | [1] | 7,702,872 | 7,609,906 |
Diluted - common stock (in shares) | shares | [1] | 7,702,872 | 7,609,906 |
Total software-related revenue | |||
Revenue | |||
Net revenue | $ 66,999 | $ 62,626 | |
Cost of Revenue | |||
Total cost of revenue | 28,838 | 27,679 | |
Software-as-a-service related | |||
Revenue | |||
Net revenue | 64,826 | 60,402 | |
Cost of Revenue | |||
Total cost of revenue | 21,724 | 21,503 | |
Maintenance | |||
Revenue | |||
Net revenue | 1,716 | 1,717 | |
Cost of Revenue | |||
Total cost of revenue | 2,117 | 1,174 | |
Professional services | |||
Revenue | |||
Net revenue | 457 | 507 | |
Cost of Revenue | |||
Total cost of revenue | 9 | 14 | |
Amortization of developed technologies | |||
Cost of Revenue | |||
Total cost of revenue | 4,988 | 4,988 | |
Other | |||
Revenue | |||
Net revenue | 3 | 23 | |
Cost of Revenue | |||
Total cost of revenue | $ 1 | $ 128 | |
[1]Reflects the 1-for-15 reverse stock split that became effective December 16, 2022. Refer to Note 1. |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Loss - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Statement of Comprehensive Income [Abstract] | ||
Net income (loss) | $ (67,779) | $ (58,543) |
Other comprehensive income (loss), net of tax | ||
Foreign currency translation adjustments | (414) | (44) |
Total other comprehensive income (loss) | (414) | (44) |
Comprehensive income (loss) | (68,193) | (58,587) |
Less: Comprehensive loss attributable to noncontrolling interests | 0 | (284) |
Comprehensive income (loss) attributable to NantHealth | $ (68,193) | $ (58,303) |
Consolidated Statements of Chan
Consolidated Statements of Changes in Stockholders' Deficit - USD ($) $ in Thousands | Total | Cumulative Effect, Period of Adoption, Adjustment | Total NantHealth Stockholders' Deficit | Total NantHealth Stockholders' Deficit Cumulative Effect, Period of Adoption, Adjustment | Common Stock | Additional Paid-In Capital | Additional Paid-In Capital Cumulative Effect, Period of Adoption, Adjustment | Accumulated Deficit | Accumulated Deficit Cumulative Effect, Period of Adoption, Adjustment | Accumulated Other Comprehensive Loss | Noncontrolling Interest | |
Beginning balance (in shares) at Dec. 31, 2020 | [1] | 7,418,982 | ||||||||||
Beginning balance at Dec. 31, 2020 | $ (111,400) | $ (5,746) | $ (111,784) | $ (5,746) | $ 11 | $ 891,583 | $ (14,318) | $ (1,003,210) | $ 8,572 | $ (168) | $ 384 | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||
Stock-based compensation expense | 4,005 | 4,005 | 4,005 | |||||||||
Shares issued in connection with employee stock plans, net of shares withheld for employee taxes ( in shares) | [1] | 40,302 | ||||||||||
Shares issued in connection with employee stock plans, net of shares withheld for employee taxes | 291 | 291 | 291 | |||||||||
Stock issued on Exchange of 2016 Notes (in shares) | [1] | 241,065 | ||||||||||
Stock issued on Exchange of 2016 Notes | 10,001 | 10,001 | $ 1 | 10,000 | ||||||||
Purchase of noncontrolling interest | (556) | (456) | (456) | (100) | ||||||||
Other comprehensive income (loss) | (44) | (44) | (44) | |||||||||
Net income (loss) | (58,543) | (58,259) | (58,259) | (284) | ||||||||
Ending balance (in shares) at Dec. 31, 2021 | [1] | 7,700,349 | ||||||||||
Ending balance at Dec. 31, 2021 | (161,992) | (161,992) | $ 12 | 891,105 | (1,052,897) | (212) | 0 | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||
Stock-based compensation expense | 4,768 | 4,768 | 4,768 | |||||||||
Shares issued in connection with employee stock plans, net of shares withheld for employee taxes ( in shares) | [1] | 2,957 | ||||||||||
Shares issued in connection with employee stock plans, net of shares withheld for employee taxes | 24 | 24 | 24 | |||||||||
Other comprehensive income (loss) | (414) | (414) | (414) | |||||||||
Net income (loss) | (67,779) | (67,779) | (67,779) | |||||||||
Ending balance (in shares) at Dec. 31, 2022 | [1] | 7,703,306 | ||||||||||
Ending balance at Dec. 31, 2022 | $ (225,393) | $ (225,393) | $ 12 | $ 895,897 | $ (1,120,676) | $ (626) | $ 0 | |||||
[1]Reflects the 1-for-15 reverse stock split that became effective December 16, 2022. Refer to Note 1. |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | ||
Cash flows from operating activities | |||
Net loss | $ (67,779) | $ (58,543) | |
Adjustments to reconcile net income (loss) to net cash used in operating activities: | |||
Depreciation and amortization | 15,992 | 15,723 | |
Amortization of debt discounts and deferred financing offering cost | 147 | 623 | |
Change in fair value of derivatives liability | 0 | (4) | |
Change in fair value of Bookings Commitment | 2,889 | 2,323 | |
Stock-based compensation | 4,665 | 3,887 | |
Deferred income taxes, net | (632) | (78) | |
Provision for bad debt expense | 70 | 123 | |
Loss on Exchange and Prepayment of 2016 Notes | 0 | 742 | |
Impairment of ROU asset | 208 | 0 | |
Changes in operating assets and liabilities | |||
Accounts receivable, net | (204) | (2,660) | |
Related party receivables, net | 105 | 336 | |
Prepaid expenses and other current assets | (881) | (104) | |
Accounts payable | 7,212 | (1,914) | |
Accrued and other current liabilities | 2,938 | 1,324 | |
Deferred revenue | (694) | 2,905 | |
Related party payables, net | 4,045 | 8,066 | |
Change in operating lease right-of-use assets and liabilities | (470) | (422) | |
Other assets and liabilities | 125 | (16) | |
Net cash provided by (used in) operating activities | (32,264) | (27,689) | |
Cash flows from investing activities | |||
Purchases of property and equipment, including internal-use software | (6,471) | (5,081) | |
Purchase of noncontrolling interest | 0 | (556) | |
Net cash provided by (used in) investing activities | (6,471) | (5,637) | |
Cash flows from financing activities | |||
Proceeds from insurance promissory note | 1,657 | 2,324 | |
Repayments of insurance promissory note and notes payable | (1,880) | (1,810) | |
Proceeds from exercises of stock options | 24 | 291 | |
Payment of deferred financing costs, related party | 0 | (277) | |
Payment of deferred financing costs | 0 | (451) | |
Proceeds from related party convertible notes | 0 | 62,500 | |
Proceeds from convertible notes | 0 | 75,000 | |
Payment of convertible notes | 0 | (97,000) | |
Proceeds from related party notes | 11,000 | 0 | |
Net cash provided by (used) in financing activities | 10,801 | 40,577 | |
Effect of exchange rate changes on cash, cash equivalents and restricted cash | 91 | (11) | |
Net (decrease) increase in cash, cash equivalents and restricted cash | (27,843) | 7,240 | |
Cash, cash equivalents and restricted cash, beginning of period | [1] | 31,402 | 24,162 |
Cash, cash equivalents and restricted cash, end of period | [1] | 3,559 | 31,402 |
Supplemental disclosure of cash flow information | |||
Income taxes paid | 211 | 400 | |
Interest paid | 6,225 | 5,628 | |
Noncash transactions: | |||
Purchases of property and equipment, including internal-use software | 103 | 118 | |
Common stock issued in Exchange for 2016 Notes | 0 | 10,000 | |
Restricted cash | 1,800 | 2,318 | |
Other Current Assets | |||
Noncash transactions: | |||
Restricted cash | 1,180 | 1,180 | |
Other Assets | |||
Noncash transactions: | |||
Restricted cash | $ 620 | $ 1,138 | |
[1]Cash and cash equivalents included restricted cash of $1,800, $2,318, and $1,375 at December 31, 2022, 2021, and 2020, respectively |
Description of Business and Bas
Description of Business and Basis of Presentation | 12 Months Ended |
Dec. 31, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Description of Business and Basis of Presentation | Description of Business and Basis of Presentation Nature of Business Nant Health, LLC was formed on July 7, 2010, as a Delaware limited liability company. On June 1, 2016, Nant Health, LLC converted into a Delaware corporation (the “LLC Conversion”) and changed its name to NantHealth, Inc. (“NantHealth”). NantHealth, together with its subsidiaries (the “Company”), is a healthcare IT company converging science and technology. The Company works to transform clinical delivery with actionable clinical intelligence at the moment of decision, enabling clinical discovery through real-time machine learning systems. The Company markets certain of its solutions as a comprehensive integrated solution that includes its clinical decision support, payer engagement solutions, data analysis and network monitoring and management. The Company also markets its clinical decision support, payer engagement solutions, data analysis and network monitoring and management on a stand-alone basis. NantHealth is a majority-owned subsidiary of NantWorks, LLC (“NantWorks”), which is a subsidiary of California Capital Equity, LLC (“Cal Cap”). The three companies were founded by and are led by Dr. Patrick Soon-Shiong. The Company is integrating our OpenNMS business with NantHealth’s software portfolio and service offerings, as well as expanding the Company’s capabilities in cloud, SaaS, and AI technologies, providing customers with services to maintain reliable network connections for critical data flows that enable patient data collaboration and decision making at the point of care. At the same time, this transaction will allow the Company to expand penetration of OpenNMS services in the healthcare industry. As of December 31, 2022, the Company conducted the majority of its operations in the United States, Canada, and the United Kingdom. Basis of Presentation and Principles of Consolidation The accompanying Consolidated Financial Statements include the accounts of NantHealth and its subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation. These Consolidated Financial Statements have been prepared in accordance with accounting principles generally accepted in the United States of America ("GAAP"). The results of operations of the entities disposed of are included in the Consolidated Financial Statements up to the date of disposal and, where appropriate, these operations have been reflected as discontinued operations. The Company has incurred significant losses and negative cash flows from operations. As of December 31, 2022, the Company had cash and cash equivalents of $1,759 and an accumulated deficit of $1,120,676. The Company had a net loss of $67,779 and used cash of $32,264 for operating activities for the year ended December 31, 2022. In accordance with Accounting Standards Update ("ASU") 2014-15, Presentation of Financial Statements—Going Concern (Subtopic 205-40): Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern, management is required to perform a two-step analysis over the Company’s ability to continue as a going concern. Management must first evaluate whether there are conditions and events that raise substantial doubt about the Company’s ability to continue as a going concern for a period of 12 months from the date the financial statements are issued. If management concludes that substantial doubt is raised, management is also required to consider whether its plans alleviate that doubt. As a result of continuing anticipated operating cash outflows the Company believes that substantial doubt exists regarding our ability to continue as a going concern without additional funding or financing. Highbridge Capital Management, LLC and its affiliates (“Highbridge”) and Nant Capital, LLC (“Nant Capital”) have agreed to consent to amendments to certain of our existing debt agreements in order to enhance our liquidity, and have confirmed their collective intent and ability to make additional loans to us to the extent necessary to support our operations in the manner currently conducted through May 17, 2024. Management believes that this agreement and intent alleviates such substantial doubt. Nant Capital is an affiliate of Dr. Patrick Soon-Shiong, our CEO. The Company may also seek to sell additional equity, through one or more follow-on public offerings or in separate financings, or sell additional debt securities, or obtain a credit facility. However, the Company may not be able to secure such financing in a timely manner or on favorable terms. The Company may also consider selling off components of its business. Without additional funds, the Company may choose to delay or reduce its operating or investment expenditures. Further, because of the risk and uncertainties associated with the commercialization of the Company's existing products as well as products in development, the Company may need additional funds to meet its needs sooner than planned. To date, the Company's primary sources of capital have been the private placement of membership interests prior to its IPO, debt financing agreements, including promissory notes with Nant Capital and affiliates, convertible notes, the sale of its common stock, and proceeds from the sale of components of its business. Nasdaq Delisting On October 31, 2022, we received a notice (the “MVPHS Notice”) from Nasdaq informing us that we are not in compliance with the minimum $15,000 market value of publicly held shares requirement for continued listing on the Nasdaq Global Select Market pursuant to Listing Rule 5450(b)(2)(C) (the “Public Float Requirement”). The MVPHS Notice had no immediate effect on our Nasdaq listing or trading of our common stock. In accordance with Listing Rule 5810(c)(3)(D), we have a period of 180 calendar days, or until May 1, 2023, to regain compliance with the Public Float Requirement. If, at any time before May 1, 2023, the market value of our Publicly Held shares of common stock closes at $15,000 or more for at least 10 consecutive business days, Nasdaq will provide written notification to us that we have regained compliance with the Public Float Requirement. If we do not regain compliance with the Public Float Requirement by May 1, 2023, Nasdaq will provide written notification to us that our common stock may be delisted. At that time, we may appeal the delisting determination to a Nasdaq Listing Qualifications Panel. We expect that our common stock would remain listed pending the panel’s decision. However, there can be no assurance that, if we receive a delisting notice and appeal the delisting determination to the panel, such appeal would be successful. We intend to monitor the market value of our common stock and may, if appropriate, consider available options to regain compliance with the Public Float Requirement. Reverse Stock Split In August 2022, our Board of Directors approved a reverse stock split of our common stock at a ratio of 1-for-15. On December 15, 2022, we filed a Certificate of Amendment to our Amended and Restated Certificate of Incorporation to effect a 1-for-15 reverse stock split of our common stock. As a result of the reverse stock split, every 15 shares of our issued or outstanding pre-reverse split common stock was combined into one share of common stock. No fractional shares were issued upon the reverse stock split. On December 16, 2022, our common stock began trading on a split-adjusted basis on the Nasdaq Stock Market. There was no change to the shares authorized or in the par value per share of $0.0001 in connection with the reverse stock split. All historical per share data, number of shares outstanding and other common stock equivalents for the periods presented in the accompanying Consolidated Financial Statements and Notes thereto have been adjusted retroactively, where applicable, to reflect the reverse stock split. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2022 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies Use of Estimates The preparation of Consolidated Financial Statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the Consolidated Financial Statements and accompanying notes. Actual results may differ from those estimates. The estimates and assumptions used in the accompanying Consolidated Financial Statements are based upon management’s evaluation of the relevant facts and circumstances at the balance sheet date. On an ongoing basis, the Company evaluates its estimates, including those related to revenue recognition, accounts receivable allowance, useful lives of long-lived assets and intangible assets, income taxes, stock-based compensation, impairment of long-lived assets and intangible assets, and the expected performance against minimum reseller commitments. The Company bases its estimates on historical experience and on various other assumptions that are believed to be reasonable, the results of which can affect the reported amounts of assets and liabilities as of the date of the financial statements, as well as the reported amounts of revenue and expenses during the periods presented. Segment Reporting The chief operating decision maker for the Company is its Chief Executive Officer. The Chief Executive Officer reviews financial information presented on a consolidated basis for purposes of allocating resources and evaluating financial performance. The Company has one business activity and there are no segment managers who are held accountable for operations, operating results, or plans for levels or components below the consolidated unit level. Accordingly, management has determined that the Company operates in one reportable segment. Revenue from Contracts with Customers Revenue is recognized upon transfer of control of promised products or services to customers in an amount that reflects the consideration the Company expects to receive in exchange for those products or services. Revenue is recognized net of sales taxes collected from customers, which are subsequently remitted to governmental authorities. The Company’s revenue is generated from the following sources: • Software-as-a-service (“SaaS”) related - SaaS related revenue is generated from customers’ access to and usage of the Company’s hosted software solutions on a subscription basis for a specified contract term. In SaaS arrangements, the customer cannot take possession of the software during the term of the contract and generally has the right to access and use the software and receive any software upgrades published during the subscription period. SaaS contracts are accounted for as a single performance obligation, as implementation and hosting services are not distinct. As a result, the Company recognizes all fees, including any up front initial system implementation service fees, or other fees, ratably over time from when the system implementation or deployment services are completed, and where necessary accepted by the customer, over the contract term, as stated, or with consideration of termination for convenience clauses as discussed below. • Maintenance - Maintenance revenue includes technical support and maintenance on OpenNMS software during the contract term. Revenue is recognized over the maintenance or support term. The Company’s networking monitoring solutions typically consist of a term-based subscription to the OpenNMS software license and maintenance, which entitle customers to unspecified software updates and upgrades on a when-and-if-available basis. The Company has determined that its promises to transfer the software license and the related maintenance are not separately identifiable because the licensed software and the software updates and upgrades are highly interdependent and highly interrelated, working together to deliver a continuously updated networking monitoring solution. The Company therefore considers the software license and related maintenance obligations to represent a single, combined performance obligation with revenue recognized over the subscription period. • Professional services - Professional services revenue is generated from consulting services to help customers install, integrate and optimize OpenNMS, sponsored development, and training to assist customers deploy and use OpenNMS solutions. Sponsored development relates to professional services to build customer specific functionality, features, and enhancements into the OpenNMS open source platform. Revenue is recognized over time for most of the Company's contracts as performance obligations are satisfied, as the Company is continuously transferring control to the customer. Typically, revenue is recognized over time using direct labor hours as a measure of progress. If any significant obligations to the customer remain post-delivery, typically involving obligations relating to acceptance by the customer, revenue recognition is deferred until such obligations have been fulfilled. Customers are generally billed as the Company satisfies its performance obligations. Billings under certain fixed-price contracts may be based upon the achievement of specified milestones. Management assesses whether contracts entered into at, or near, the same time, should be combined, based on evaluation of the commercial objectives of the contracts. Certain of the Company’s customer contracts allow for termination for convenience, with advanced notice, without substantive termination penalty. In these cases, the Company has concluded the contract term is equal to the remaining non-cancelable period. Such termination rights do not allow for refunds other than prepaid services. These provisions do not affect when the Company commences revenue recognition. Contracts with Multiple Promises for Goods and Services The Company engages in various contracts with promises for multiple goods and services, which may generate revenue across any of the sources noted above. In certain contracts, the Company recognizes its proprietary software, software license, technical support, maintenance, consulting services, sponsored development services, training, certain professional services, and other software-related services as distinct performance obligations. Standalone selling prices (“SSP”) are required to be allocated and revenue recognized for each distinct performance obligation within each contract. Judgment is required to determine the SSP for each distinct performance obligation. The SSP for each performance obligation is determined by considering contracts in which the good or service is sold separately and other factors, including market conditions and the Company’s experience selling similar goods and services, as well as costs and margins achieved. In some cases, to estimate the SSP, the Company first estimates the selling price of each performance obligation for which an SSP is observable and then estimates the SSP of the remaining performance obligation as the residual contractual amount. Generally, consulting and sponsored development professional services do not involve significant integration or customization of the OpenNMS software. As such, consulting and sponsored development are considered distinct performance obligations. The Company has reseller arrangements, and for each promised good or service, the Company evaluates whether it is a principal or an agent. The Company assesses control in terms of relevant indicators of performance, inventory, and pricing risk, such as which party negotiates pricing with the end customer and which party is ultimately responsible for fulfilling services, transferring goods and services, and ensuring support. Cost of Revenue Cost of revenue includes associated salaries and fringe benefits, stock-based compensation, consultant costs, direct reimbursable travel expenses, depreciation related to software developed for internal use, depreciation related to lab equipment, and other direct engagement costs associated with the design, development, sale and installation of systems, including system support and maintenance services for customers. System support includes ongoing customer assistance for software updates and upgrades, installation, training and functionality. All service costs, except development of internal use software and deferred implementation costs, are expensed when incurred. Amortization of deferred implementation costs are also included in cost of revenue. Cost of revenue associated with each of the Company’s revenue sources consists of the following types of costs: • Software-as-a-service related - SaaS related cost of revenue includes personnel-related costs, amortization of deferred implementation costs, amortization of internal-use software, and other direct costs associated with the delivery and hosting of the Company's subscription services. • Maintenance - Maintenance cost of revenue includes personnel-related costs, amortization of internal-use software, and other direct costs associated with the ongoing support or maintenance provided to the Company’s customers. • Professional services - Professional services cost of revenue include personnel-related costs and other direct costs associated with consulting, sponsored development, and training provided to the Company's customers. Selling, General and Administrative Expenses Selling, general and administrative expense consists primarily of personnel-related expenses for the Company's sales and marketing, finance, legal, human resources, administrative personnel, stock-based compensation, advertising and marketing promotions of NantHealth solutions, and corporate shared services fees from NantWorks. This includes amortization of deferred commission costs. It also includes trade show and event costs, sponsorship costs, point of purchase display expenses and related amortization as well as legal costs, facility costs, consulting and professional fees, insurance and other corporate and administrative costs. Research and Development Expenses Research and development (“R&D”) costs incurred to establish the technological feasibility of software to be sold are expensed as incurred. These expenses include the costs of the Company’s proprietary R&D efforts, as well as costs incurred in connection with certain licensing arrangements. Research and development expenses consist primarily of personnel-related costs for employees working on development of solutions, including salaries, benefits, and stock-based compensation. Also included are non-personnel costs such as consulting and professional fees to third-party development resources. Substantially all of the Company's research and development expenses are related to developing new software solutions and improving its existing software solutions. These costs incurred in the research and development of new software products and maintenance to existing software products are expensed as incurred. These costs are associated with both the preliminary project stage and post-implementation stage of internal-use software. Qualifying costs associated with the application development stage are capitalized. Stock-Based Compensation The Company accounts for stock-based compensation arrangements granted to employees in accordance with ASC 718, Compensation–Stock Compensation, by measuring the grant date fair value of the award and recognizing the resulting expense over the period during which the employee is required to perform service in exchange for the award. The Company accounts for stock-based compensation arrangements issued to non-employees using the fair value approach prescribed by ASC 505-50, Equity-Based Payments to Non-Employees. Stock-based compensation expense for both employee and nonemployee awards is recognized on a straight-line basis over the appropriate service period for awards that are only subject to service conditions and is recognized using the accelerated attribution method for awards that are subject to performance conditions. Stock-based compensation expense is only recognized for awards subject to performance conditions if it is probable that the performance condition will be achieved. All excess tax benefits and tax deficiencies are recognized as income tax benefit or expense in the income statement as discrete items in the reporting period in which they occur, and such tax benefits and tax deficiencies are not included in the estimate of an entity’s annual effective tax rate, applied on a prospective basis. The recognition of excess tax benefits is deferred until the benefit is realized through a reduction to taxes payable. When the Company applies the treasury stock method in calculating diluted earnings per share, excess tax benefits, if applicable, and deficiencies from the calculation of assumed proceeds are excluded since such amounts are recognized in the income statement. Excess tax benefits if applicable, are classified as operating activities in the same manner as other cash flows related to income taxes on the statement of cash flows. The Company has elected to account for forfeitures when they occur. Cash paid by the Company when directly withholding shares for tax withholding purposes is classified as a financing activity in the Consolidated Statements of Cash Flows (see Note 13 and Note 15). Change in Fair Value of Bookings Commitment The Company has classified the Bookings Commitment assumed upon the disposal of the provider/patient engagement solutions business described in Note 10 as part of accrued and other current liabilities and other liabilities in the Consolidated Balance Sheets. This liability is subject to re-measurement at each balance sheet date, and the Company recognizes any changes in fair value within other income/expense, net. The fair value of the liability is estimated using a Monte Carlo Simulation model to calculate average payments due under the Bookings Commitment, based on management's estimate of its performance in securing bookings and resulting annual payments, discounted at the cost of debt based on a yield curve. The change in the fair value of this liability is primarily due to changes in the costs of debt based on a yield curve and the passage of time (see Note 10). Management believes the assumptions used on projected financial information is reasonable, but those assumptions require judgment and are forward looking in nature. However, actual results may differ materially from those projections. The fair value of the Bookings Commitment is most sensitive to management's estimate of the discount rate applied to present value the liability. If the discount rate applied was 2% lower at December 31, 2022, the fair value of the liability would increase by $3,423. Income Taxes The Company records the federal and state tax provision of the consolidated group and foreign tax provision of its foreign subsidiaries. ASC 740, Income Taxes , provides the accounting treatment for uncertainty in income taxes recognized in an enterprise’s financial statements. ASC 740 prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. ASC 740 also provides guidance on derecognizing, classification, interest and penalties, accounting in interim periods, disclosure, and transition. As part of the process of preparing its Consolidated Financial Statements, the Company is required to estimate its provision for income taxes in each of the tax jurisdictions in which the Company conducts business. This process involves estimating the actual current tax expense in conjunction with the evaluation and measurement of temporary differences resulting from differing treatment of certain items for tax and accounting purposes. These temporary differences result in the establishment of deferred tax assets and liabilities, which are recorded on a net basis and included in the Company's Consolidated Balance Sheets. The Company then evaluates on a periodic basis the probability that the net deferred tax assets will be recovered and therefore realized from future taxable income and to the extent the Company believes that recovery is not more likely than not, a valuation allowance is established to address such risk resulting in an additional related provision for income taxes during the period. Significant management judgment is required in determining its provision for income taxes, its deferred tax assets and liabilities, tax contingencies, unrecognized tax benefits, and any required valuation allowance, including taking into consideration the probability of the tax contingencies being incurred. Management assesses this probability based upon information provided by its tax advisers, its legal advisers and similar tax cases. If at a later time its assessment of the probability of these tax contingencies changes, its accrual for such tax uncertainties may increase or decrease. The Company has a valuation allowance due to management’s overall assessment of risks and uncertainties related to its future ability to realize and, hence, utilize certain deferred tax assets, primarily consisting of net operating losses ("NOLs"), carry forward temporary differences and future tax deductions. The effective tax rate for annual and interim reporting periods could be impacted if uncertain tax positions that are not recognized are settled at an amount which differs from the Company's estimate. Finally, if the Company is impacted by a change in the valuation allowance resulting from a change in judgment regarding the realizability of deferred tax assets, such effect will be recognized in the interim period in which the change occurs. Net Loss Per Share Basic net loss per common share attributable to NantHealth is computed by dividing the net loss attributable to NantHealth by the weighted average number of shares of common stock outstanding during the respective periods, without consideration of common stock equivalents. Diluted net loss per common share attributable to NantHealth is computed by dividing the net loss attributable to NantHealth by the weighted average number of shares of common stock outstanding during the respective periods, adjusted to give effect to potentially dilutive securities. However, potentially dilutive securities are excluded from the computation of diluted net loss per common share attributable to NantHealth to the extent that their effect is anti-dilutive. If there is a net loss from continuing operations attributable to NantHealth, diluted net loss per share attributable to NantHealth is computed in the same manner as basic net loss per share attributable to NantHealth is computed, even if the Company reports net income as a result of discontinued operations attributable to NantHealth. The Company applies treasury method in calculating weighted average dilutive number of shares for its stock plans. The convertible notes will be reflected in diluted loss per share using the if-converted method until the Company makes an irrevocable settlement election requiring the future settlement of the convertible notes to have the principal amount settled in cash. Foreign Currency Translation The Company has operations and holds assets in various foreign countries. The local currency is the functional currency for the Company’s subsidiaries in the United Kingdom and Canada. Assets and liabilities are translated at end-of-period exchange rates while revenues and expenses are translated at the average exchange rates in effect during the period. Equity is translated at historical rates and the resulting cumulative translation adjustments are included as a component of accumulated other comprehensive income/loss until the translation adjustments are realized. Leases The Company determines if an arrangement is a lease at inception . Operating leases are included in operating lease right-of-use (“ROU”) assets, other current liabilities are included in property, plant, and equipment, net, other current liabilities, and other liabilities in the Consolidated Balance Sheets. The Company currently does not have any finance leases. Operating lease ROU assets and operating lease liabilities are recognized based on the present value of the future minimum lease payments over the lease term at commencement date. The Company's leases do not provide an implicit rate; therefore, the Company uses the incremental borrowing rate based on the information available at commencem ent date, or at January 1, 2019 for the Company's leases on transition to ASC 842, in determining the present value of future payments. The operating lease ROU asset excludes lease incentives and initial direct costs incurred. The lease terms may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. Lease expense for minimum lease payments is recognized on a straight-line basis over the lease term. The Company has lease agreements with lease and non-lease components. For data center leases and real estate leases, the Company accounts for the lease and non-lease components as a single lease component. The Company treats data center leases with lease terms of less than one year as short-term leases and recognizes the lease expense straight-line over the lease term. Business Combinations Business combinations are accounted for using the acquisition method of accounting. Under the acquisition method, assets acquired and liabilities assumed are recorded at their respective fair values as of the acquisition date. Any excess of the purchase price over the estimated fair values of the net assets acquired is recorded as goodwill. Management routinely monitors the factors impacting the acquired assets and liabilities. Transaction related costs are expensed as incurred. The operating results of the acquired business are reflected in the Company’s Consolidated Financial Statements as of the acquisition date. Fair Value of Financial Instruments Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Fair value measurements are classified and disclosed in one of the following three categories: • Level 1—Quoted prices for identical assets or liabilities in active markets; • Level 2—Quoted prices for similar assets or liabilities in active markets or quoted prices for identical or similar assets or liabilities in markets that are not active or are directly or indirectly observable; and • Level 3—Unobservable inputs that reflect estimates and assumptions. The carrying amounts reported in the Consolidated Balance Sheets for cash and cash equivalents, accounts receivable, accounts payable, notes payable, deferred revenue, and other current monetary assets and liabilities approximate fair value because of the immediate or short-term maturity of these financial instruments. In accordance with this guidance, the Company measures its cash equivalents at fair value. The Company’s cash equivalents are classified within Level 1. The Company's fair value estimate of the Bookings Commitment and convertibles notes are based on Level 3 inputs. Cash and Cash Equivalents The Company considers all unrestricted, highly liquid investments with an initial maturity of three months or less to be cash equivalents. These amounts are stated at cost, which approximates fair value. At December 31, 2022 and 2021, cash equivalents were deposited in financial institutions and consisted of immediately available fund balances. Cash and cash equivalents are maintained at stable financial institutions, generally at amounts in excess of federally insured limits, which represents a concentration of credit risk. The Company has not experienced any losses on deposits of cash and cash equivalents to date. Accounts Receivable and Allowance for Doubtful Accounts Accounts receivable are recorded at the invoiced amount, net of allowances for doubtful accounts. The allowance for doubtful accounts is based on management’s assessment of the collectability of accounts. The Company regularly reviews the adequacy of the allowance for doubtful accounts by considering the age of each outstanding invoice and the collection history of each customer to determine whether a specific allowance is appropriate. Accounts receivable deemed uncollectible are charged against bad debt expense when identified. Concentrations of Risk The following table summarizes the number of customers that individually comprise greater than 10% of revenues and/or 10% of accounts receivable, and their aggregate percentages of total revenues and total billed and unbilled accounts receivable: Period Significant Customers Percentage of Total Revenues Percentage of Total Accounts Receivable A B C A B C Year Ended December 31, 2022 3 27.7 % 13.0 % (1) 26.7 % (1) 16.2 % Year Ended December 31, 2021 3 22.8 % 12.9 % (1) 26.2 % 12.2 % 13.7 % (1) Amounts less than 10% are not disclosed. Insurance Recoveries The Company records probable insurance recoveries gross of related liabilities. The income and expense related to these amounts are recorded net in selling, general and administrative expenses. If the recoveries exceed the loss recognized in the financial statements, such recoveries are recorded in other expense, net, once any contingencies relating to the insurance claim have been resolved. Property, Plant and Equipment, net Property, plant and equipment received in connection with business combinations are recorded at fair value. Property, plant and equipment acquired in the normal course of business are recorded at cost. Depreciation is computed on a straight-line basis over the estimated useful lives of the related assets (see Note 6). Maintenance and repairs are charged to expense as incurred while expenditures for refurbishments and improvements that significantly add to the productive capacity or extend the useful life of an asset are capitalized. Property, plant and equipment is tested for impairment, and depreciation estimates and methods are reviewed, whenever events or changes in circumstances indicate that its carrying amount may not be recoverable. Internal-Use Software The Company accounts for the costs of computer software obtained or developed for internal use in accordance with ASC 350, Intangibles—Goodwill and Other . Computer software development costs are expensed as incurred, except for internal-use software costs that qualify for capitalization, and include employee related expenses, including salaries, benefits and stock-based compensation expenses; costs of computer hardware and software; and costs incurred in developing features and functionality. These capitalized costs are included in property and equipment in the Consolidated Balance Sheets. The Company expenses costs incurred in the preliminary project and post implementation stages of software development and capitalizes qualifying costs incurred in the application development stage and costs associated with significant enhancements to existing internal-use software applications. Software costs are amortized using the straight-line method over an estimated useful life of three years commencing when the software project is ready for its intended use. Internal-use software is tested for impairment where assets are grouped at the lowest level for which there are identifiable cash flows that are largely independent of the cash flows of other groups of assets whenever events or changes in circumstances indicate that its carrying amount may not be recoverable. Goodwill and Intangible Assets Goodwill acquired in a business combination and determined to have an indefinite useful life is not amortized but is tested for impairment annually as of October 1 or between annual tests when an impairment indicator exists. In the event there is a change in reporting units or segments, the Company will test for impairment at the reporting unit. A component of an operating segment is a reporting unit if the component constitutes a business for which discrete financial information is available and segment management regularly reviews the operating results of that component. As part of the annual impairment test, the Company may conduct an assessment of qualitative factors to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount. In a qualitative assessment, the Company would consider the macroeconomic conditions, including any deterioration of general conditions, industry and market conditions, including any deterioration in the environment where the reporting unit operates, increased competition, changes in the products/services and regulator and political developments; cost of doing business; overall financial performance, including any declining cash flows and performance in relation to planned revenues and earnings in past periods; other relevant reporting unit specific facts, such as changes in management or key personnel or pending litigation, and events affecting the reporting unit, including changes in the carrying value of net assets. If an optional qualitative goodwill impairment assessment is not performed, the Company is required to determine the fair value of each reporting unit. If a reporting unit’s carrying value is in excess of its fair value, such excess is recorded as an impairment loss. Under the accounting guidance, there is no requirement to perform a qualitative assessment for reporting units with zero or negative carrying values. Accounting guidance requires that definite-lived intangible assets be amortized over their respective estimated useful lives and reviewed for impairment whenever events or changes in circumstances indicate that their carrying amounts may not be recoverable. Amortization of finite-lived intangible assets is provided over their estimated useful lives on a straight-line basis or the pattern in which economic benefits are consumed, if reliably determinable. If the estimates of the useful lives change, the Company amortizes the remaining book value over the remaining useful lives or, if an asset is deemed to be impaired, a write-down of the value of the asset to its fair value may be required at such time. The Company reviews its finite-lived intangible assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Deferred Revenue The Company records deferred revenue when it receives cash from customers prior to meeting the applicable revenue recognition criteria. The Company uses judgment in determining the period over which the deliverables are recognized as revenue. As of December 31, 2022 and 2021, current and non-current deferred revenue are comprised of deferrals for fees related to SaaS arrangements, technical support and maintenance, services and other revenue. Non-current deferred revenue as of December 31, 2022 is expected to be recognized in a period more than 12 months after that date. Recently Adopted Accounting Pronouncements In August 2020, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU') No. 2020-06, Debt - Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging - Contracts in Entity's Own Equity (Subtopic 815-40) . This update simplifies the accounting for convertible instruments by eliminating the cash conversion and beneficial conversion feature models which require separate accounting for embedded conversion features. This update also amends the guidance for the derivatives scope exception for contracts in an entity's own equity to reduce form-over-substance-based accounting conclusions and requires the application of the if-converted method for calculating diluted earnings per share. ASU No. 2020-06 is effective for fiscal periods beginning after December 15, 2023. The Company early adopted ASU 2020-06 on a modified retrospective basis on January 1, 2021. The cumulative effect of the adoption on accumulated deficit and additional paid-in capital was a decrease of $8,572 and $14,318, respectively, on January 1, 2021. Under the new guidance, the Company will record less noncash interest expense going forward as the cash conversion model that was previously applied is now eliminated. Upcoming Accounting Standard Pronouncements In June 2016, the FASB issued ASU No. 2016-13, Measurement of Credit Losses on Financial Instruments , which changes how companies measure credit losses on most financial instruments measured at |
Revenue Recognition
Revenue Recognition | 12 Months Ended |
Dec. 31, 2022 | |
Revenue from Contract with Customer [Abstract] | |
Revenue Recognition | Revenue Recognition Contract Balances The Company records deferred revenue when cash payments are received, or payment is due, in advance of its fulfillment of performance obligations. There were revenues of $2,770 and $1,408 recognized during the years ended December 31, 2022 and 2021, respectively, that were included in the deferred revenue balance at the beginning of the period. Assets Recognized from the Costs to Obtain a Contract with a Customer The Company recognizes an asset for the incremental costs to obtain a contract with a customer, where the stated contract term, with expected renewals, is longer than one year. The Company amortizes these assets over the expected period of benefit. These costs are generally employee sales commissions, with amortization of the balance recorded in selling, general and administrative expenses. The value of these assets was $686 and $810 at December 31, 2022 and December 31, 2021, respectively, and amortization during the years ended December 31, 2022 and 2021 was $549 and $860, respectively. Where management is not able to conclude that the costs of a contract will be recovered, costs to obtain the contract are expensed as incurred. Performance Obligations As of December 31, 2022, the Company has allocated a total transaction price of $2,377 to unfulfilled performance obligations that are expected to be fulfilled within eight years. Excluded from this amount are contracts of less than one year and variable consideration that relates to the value of services provided. |
Accounts Receivable, net
Accounts Receivable, net | 12 Months Ended |
Dec. 31, 2022 | |
Receivables [Abstract] | |
Accounts Receivable, net | Accounts Receivable, net Accounts receivable are included in the Consolidated Balance Sheets net of the allowance for doubtful accounts. A summary of activity in the allowance for doubtful accounts for the years ended December 31, 2022 and 2021 is as follows: Balance at beginning of the period Additions to expense (Write offs) / Recoveries Balance at end of the period Year ended December 31, 2022 $ 2 20 (7) $ 15 Year ended December 31, 2021 $ 44 28 (70) $ 2 |
Prepaid Expenses and Other Curr
Prepaid Expenses and Other Current Assets and Accrued and Other Current Liabilities | 12 Months Ended |
Dec. 31, 2022 | |
Other Current Assets And Other Current Liabilities [Abstract] | |
Prepaid Expenses and Other Current Assets | Prepaid Expenses and Other Current Assets and Accrued and Other Current Liabilities Prepaid expenses and other current assets as of December 31, 2022 and 2021 consisted of the following: December 31, 2022 2021 Prepaid expenses $ 1,574 $ 2,256 Restricted cash 1,180 1,180 Securities litigation insurance receivable 1,250 — Other current assets 398 574 Prepaid expenses and other current assets $ 4,402 $ 4,010 Accrued and other current liabilities of December 31, 2022 and 2021 consisted of the following: December 31, 2022 2021 Payroll and related costs $ 7,949 $ 8,545 Accrued liabilities 4,279 2,640 Booking Commitment (see Note 10) 2,153 1,661 Securities litigation and cyber estimated liability 1,470 — Interest payable 703 703 Operating lease liabilities 2,105 1,912 Other accrued and other current liabilities 1,347 897 Accrued and other current liabilities $ 20,006 $ 16,358 |
Accrued and Other Current Liabilities | Prepaid Expenses and Other Current Assets and Accrued and Other Current Liabilities Prepaid expenses and other current assets as of December 31, 2022 and 2021 consisted of the following: December 31, 2022 2021 Prepaid expenses $ 1,574 $ 2,256 Restricted cash 1,180 1,180 Securities litigation insurance receivable 1,250 — Other current assets 398 574 Prepaid expenses and other current assets $ 4,402 $ 4,010 Accrued and other current liabilities of December 31, 2022 and 2021 consisted of the following: December 31, 2022 2021 Payroll and related costs $ 7,949 $ 8,545 Accrued liabilities 4,279 2,640 Booking Commitment (see Note 10) 2,153 1,661 Securities litigation and cyber estimated liability 1,470 — Interest payable 703 703 Operating lease liabilities 2,105 1,912 Other accrued and other current liabilities 1,347 897 Accrued and other current liabilities $ 20,006 $ 16,358 |
Property, Plant and Equipment,
Property, Plant and Equipment, net | 12 Months Ended |
Dec. 31, 2022 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant and Equipment, net | Property, Plant and Equipment, net Property, plant and equipment, net as of December 31, 2022 and 2021 consisted of the following: December 31, Useful life (in years) 2022 2021 Computer equipment and software 3 - 5 $ 7,592 $ 9,267 Furniture and equipment 5 - 7 1,054 1,060 Leasehold and building improvements (1) 3,776 3,821 Property, plant, and equipment, excluding internal-use software 12,422 14,148 Less: Accumulated depreciation and amortization (11,073) (10,857) Property, plant and equipment, excluding internal-use software, net 1,349 3,291 Internal-use software 3 49,479 43,314 Construction in progress - Internal-use software 1,464 1,082 Less: Accumulated depreciation and amortization - internal-use software (39,909) (35,321) Internal-use software, net 11,034 9,075 Property, plant and equipment, net $ 12,383 $ 12,366 (1) Useful lives for leasehold and building improvements represent the term of the lease or the estimated life of the related improvements, whichever is shorter. Depreciation expense from continuing operations was $6,513 and $5,932 for the years ended December 31, 2022 and 2021, respectively, of which $4,592 and $4,027, respectively, related to internal-use software costs. Amounts capitalized to internal-use software related to continuing operations for the years ended December 31, 2022 and 2021 were $6,713 and $4,727, respectively. |
Intangible Assets, net
Intangible Assets, net | 12 Months Ended |
Dec. 31, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Intangible Assets, net | Intangible Assets, net The Company’s definite-lived intangible assets as of December 31, 2022 and 2021 consisted of the following: December 31, 2022 Customer Developed Technologies Trade Name Installed User Base Total Gross carrying amount $ 53,000 $ 34,500 $ 3,300 $ 1,400 $ 92,200 Accumulated amortization (24,794) (33,319) (3,238) (739) (62,090) Intangible assets, net $ 28,206 $ 1,181 $ 62 $ 661 $ 30,110 December 31, 2021 Customer Developed Technologies Trade Name Installed User Base Total Gross carrying amount $ 53,000 $ 34,500 $ 3,300 $ 1,400 $ 92,200 Accumulated amortization (21,161) (28,331) (3,163) (506) (53,161) Intangible assets, net $ 31,839 $ 6,169 $ 137 $ 894 $ 39,039 Amortization of definite-lived intangible assets is provided over their estimated useful lives on a straight-line basis or the pattern in which economic benefits are consumed, if reliably determinable. The Company reviews its definite-lived intangible assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Amortization expense from continuing operations was $8,930 and $8,930 for the years ended December 31, 2022 and 2021, respectively. The estimated future amortization expense over the next five years and thereafter for the intangible assets that exist as of December 31, 2022 is as follows: Amounts 2023 $ 4,346 2024 4,283 2025 4,147 2026 3,467 2027 3,467 Thereafter 10,400 Total future intangible amortization expense $ 30,110 |
Goodwill
Goodwill | 12 Months Ended |
Dec. 31, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill | Goodwill Goodwill as of both December 31, 2022 and 2021 was $98,333. The Company's single reporting unit had a negative carrying value therefore the Company did not record any goodwill impairments in either 2022 or 2021. |
Convertible Notes
Convertible Notes | 12 Months Ended |
Dec. 31, 2022 | |
Debt Disclosure [Abstract] | |
Convertible Notes | Convertible Notes 2016 5.5% Convertible Senior Notes ("2016 Notes") In December 2016, the Company entered into the Purchase Agreement with J.P. Morgan Securities LLC and Jefferies LLC, as representatives of the several initial purchasers named therein (collectively, the “Initial Purchasers”), to issue and sell $90,000 in aggregate principal amount of its 5.5% senior convertible notes due 2021 ("2016 Notes") in a private placement to qualified institutional buyers pursuant to Rule 144A under the Securities Act of 1933, as amended (the “Securities Act”), and to non-U.S. persons pursuant to Regulation S under the Securities Act. In December 2016, the Company entered into a purchase agreement (the “Cambridge Purchase Agreement”) with Cambridge, an entity affiliated with Dr. Soon-Shiong, the Company’s Chairman and Chief Executive Officer, to issue and sell $10,000 in aggregate principal amount of the 2016 Notes in a private placement pursuant to an exemption from the registration requirements of the Securities Act afforded by Section 4(a)(2) of the Securities Act. In December 2016, pursuant to the exercise of the overallotment by the Initial Purchasers, the Company issued an additional $7,000 principal amount of the 2016 Notes. The total net proceeds from this offering were approximately $102,714, comprised of $9,917 from Cambridge and $92,797 from the Initial Purchasers, after deducting the Initial Purchasers’ discount and debt issuance costs of $4,286 in connection with the Convertible Notes offering. The interest rate on the 2016 Notes was fixed at 5.5% per year, payable semi-annually on June 15th and December 15th of each year, beginning on June 15, 2017. The 2016 Notes matured on December 15, 2021. The Company adopted ASU No. 2020-06 on January 1, 2021 through a modified retrospective method of transition, which eliminated the separation model for convertible debt with a cash conversion feature, resulting in less noncash interest expense going forward (see Note 2). The cumulative effect of the adoption on January 1, 2021 was a decrease of $5,746 to unamortized debt discount and deferred financing offering costs. The debt discounts and deferred financing offering costs on the 2016 Notes were amortized to interest expense over the contractual terms of the 2016 Notes, using the effective interest method at an effective interest rate of 6.78%. On April 13, 2021, NantHealth entered into a transaction with Highbridge Capital Management, LLC and one of its affiliates (“Highbridge”) to exchange $5,000 principal amount of its $36,945 in existing 2016 Notes and with Cambridge to exchange $5,000 principal amount of its $10,000 in existing 2016 Notes for shares of the Company’s common stock pursuant to an exchange agreement dated as of April 13, 2021 (the “Exchange Agreement”). On April 13, 2021, in connection with the Exchange Agreement, the Company paid Cambridge $91 for accrued and unpaid interest and issued 112,612 shares of the Company’s common stock at $44.40 per share, representing the closing price of the Company’s common stock on April 13, 2021. The Company recorded a loss on exchange of the 2016 Notes with Cambridge and a decrease to unamortized debt discount and deferred financing offering costs of $18. On April 14, 2021, in connection with the Exchange Agreement, the Company paid Highbridge $92 for accrued and unpaid interest and issued 128,452 shares of the Company’s common stock at $38.925 per share, representing the closing price of the Company’s common stock on April 14, 2021. The Company recorded a loss on exchange of the 2016 Notes with Highbridge and a decrease to unamortized debt discount and deferred financing offering costs of $44. On December 15, 2021, the Company paid the remaining outstanding principal balance of the 2016 Notes of $9,500 plus accrued interest through that date. 2021 4.5% Convertible Senior Notes ("2021 Notes") On April 13, 2021, the Company and its wholly owned subsidiary, NaviNet (the "Guarantor") entered into a note purchase agreement (the “Note Purchase Agreement”) with Highbridge and certain other buyers, including Nant Capital to issue and sell $137,500 in aggregate principal amount of its 4.5% convertible senior notes in a private placement pursuant to an exemption from the registration requirements of the Securities Act afforded by Section 4(a)(2) of the Securities Act. The 2021 Notes were issued on April 27, 2021. The total net proceeds from this offering were approximately $136,772, comprised of $62,223 from Nant Capital and $74,549 from Highbridge, after deducting the Highbridge’s debt issuance costs of $118 and $610 in debt issuance costs paid to third parties in connection with the 2021 Notes offering. The Company used part of the proceeds from the 2021 Notes issuance to repurchase the remaining $31,945 of principal amount of the 2016 Notes held by Highbridge (“Repurchased Notes”) and pay $644 of accrued and unpaid interest. The Company recorded a loss on repurchase of the 2016 Notes with Highbridge and a decrease to unamortized debt discount and deferred financing offering costs of $267. On April 27, 2021, in connection with the issuance of the 2021 Notes, the Company provided a notice of a fundamental change (as defined in the indenture governing the Company's 2016 Notes) and an offer to repurchase all the outstanding 2016 Notes. On May 25, 2021, the Company purchased $55,555 of the outstanding 2016 Notes ("Fundamental Change Repurchase") and paid $1,358 of accrued and unpaid interest thereon. The Company recorded a loss on repurchase of the 2016 Notes with other investors and a decrease to unamortized debt discount and deferred financing offering costs of $412. On April 27, 2021, the 2021 Notes were issued to the investors under an indenture (the “2021 Indenture”) dated April 27, 2021 entered into between the Company and U.S. Bank National Association (the “Trustee”). The interest rates are fixed at 4.5% per year, payable semi-annually on October 15th and April 15th of each year, beginning on October 15, 2021. The 2021 Notes will mature on April 15, 2026, unless earlier repurchased by the Company or converted pursuant to their terms. The deferred financing offering costs on the 2021 Notes are being amortized to interest expense over the contractual terms of the 2021 Notes, using the effective interest method at an effective interest rate of 4.61%. The conversion rate of the 2021 Notes is 17.3250 shares of common stock per $1 principal amount of 2021 Notes (which is equivalent to a conversion price of approximately $57.72 per share). The conversion rate will be subject to adjustment upon the occurrence of certain specified events in accordance with the terms of the 2021 Indenture but will not be adjusted for accrued and unpaid interest. Holders of the 2021 Notes may convert all or a portion of their 2021 Notes, in multiples of $1 principal amount, at any time prior to the close of business on the business day immediately preceding the maturity date. Upon conversion, the 2021 Notes will be settled in cash, shares of the Company's common stock or any combination thereof at the Company's option. As of December 31, 2022 the remaining life of the 2021 Notes is approximately 40 months. The 2021 Notes are the Company’s general unsecured obligations and are initially guaranteed on a senior unsecured basis by the Guarantor. The Company may not redeem the 2021 Notes prior to April 20, 2024. The Company may redeem for cash all or any portion of the 2021 Notes, at its option, on or after April 20, 2024, if the last reported sale price of the common stock has been at least 130% of the conversion price then in effect for at least 20 trading days (whether or not consecutive) during any 30 consecutive trading day period (including the last trading day of such 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 2021 Notes to be redeemed, plus any accrued and unpaid special interest up to, but excluding, the redemption date. No sinking fund is provided for the 2021 Notes, which means that the Company is not required to redeem or retire the 2021 Notes periodically. If the Company exercises this option to redeem the 2021 Notes owned by Highbridge and Highbridge is unable to convert such 2021 Notes as a result of the application of the beneficial ownership limitations, at the request of Highbridge, the Company shall convert such 2021 Notes into the number of shares of the Company’s Series 1 Preferred Stock equal to the number of shares that the 2021 Notes are convertible into pursuant to the Conversion Option (as defined in the 2021 Indenture) into common stock. Upon the occurrence of a fundamental change (as defined in the 2021 Indenture), holders may require the Company to purchase all or a portion of the 2021 Notes in principal amounts of $1 or an integral multiple thereof, for cash at a price equal to 100% of the principal amount of the 2021 Notes to be purchased plus any accrued and unpaid interest to, but excluding, the fundamental change purchase date. For so long as at least $25,000 principal amount of the 2021 Notes are outstanding, the 2021 Indenture restricts the Company or any of its subsidiaries from creating, assuming, or incurring any indebtedness owing to any of the Company's affiliates (other than intercompany indebtedness between the Company and its subsidiaries and other than any of the Company's 2021 Notes), or prepaying any such indebtedness, subject to certain exceptions, unless certain conditions described in the 2021 Indenture have been satisfied. Under the 2021 Indenture, the Company may incur affiliate debt if there is (i) no default or event of default at the time of such incurrence or would occur as a consequence of such incurrence; (ii) such affiliate debt is unsecured and subordinated to the 2021 Notes; and (iii) no principal of such affiliate debt is scheduled to mature earlier than the date that is 181 days after April 15, 2026, the maturity date of the 2021 Notes. See Note 12 Commitments and Contingencies for default provisions. The following table summarizes the parties involved in the issuance of the convertible notes and their respective balances in the Company's Consolidated Balance Sheets as of December 31, 2022 and 2021: Related party Others Total 2021 Notes: Balance as of December 31, 2022 Gross proceeds $ 62,500 $ 75,000 $ 137,500 Unamortized debt discounts and deferred financing offering costs (165) (317) (482) Net carrying amount $ 62,335 $ 74,683 $ 137,018 2021 Notes: Balance as of December 31, 2021 Gross proceeds $ 62,500 $ 75,000 $ 137,500 Unamortized debt discounts and deferred financing offering costs (232) (397) (629) Net carrying amount $ 62,268 $ 74,603 $ 136,871 The following table sets forth the Company's interest expense incurred for the years ended December 31, 2022 and 2021: Year Ended December 31, 2022 2021 Related party Others Total Related party Others Total Accrued coupon interest expense $ 2,813 $ 3,375 $ 6,188 $ 1,898 $ 2,278 $ 4,176 Amortization of debt discounts — — — 21 119 140 Amortization of deferred financing offering costs 67 80 147 57 426 483 Total convertible notes interest expense $ 2,880 $ 3,455 $ 6,335 $ 1,976 $ 2,823 $ 4,799 |
Fair Value Measurements
Fair Value Measurements | 12 Months Ended |
Dec. 31, 2022 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements Liabilities measured at fair value on a recurring basis as of December 31, 2022 and 2021 consisted of the following: December 31, 2022 Total fair value Quoted price in active markets for identical assets (Level 1) Significant other observable inputs (Level 2) Significant unobservable inputs (Level 3) Liabilities Bookings Commitment $ 36,863 $ — $ — $ 36,863 December 31, 2021 Total fair value Quoted price in active markets for identical assets (Level 1) Significant other observable inputs (Level 2) Significant unobservable inputs (Level 3) Liabilities Bookings Commitment $ 34,474 $ — $ — $ 34,474 The Company’s intangible assets and goodwill are initially measured at fair value and any subsequent adjustment to the initial fair value occurs only if an impairment charge is recognized. Level 2 and 3 Inputs Bookings Commitment On August 3, 2017, the Company entered into an asset purchase agreement (the “APA”) with Allscripts Healthcare Solutions, Inc. (“Allscripts”), pursuant to which the Company agreed to sell to Allscripts substantially all of the assets of the Company’s provider/patient engagement solutions business, including the Company’s FusionFX solution and components of its NantOS software connectivity solutions (the “Business”). On August 25, 2017, the Company and Allscripts completed the sale of the Business (the "Disposition") pursuant to the APA. Concurrent with the closing of the Disposition and as contemplated by the APA, (a) the Company and Allscripts modified the amended and restated mutual license and reseller agreement dated June 26, 2015, which was further amended on December 30, 2017, such that, among other things, the Company committed to deliver a minimum of $95,000 of total bookings over a ten-year period (“Bookings Commitment”) from referral transactions and sales of certain Allscripts products; (b) the Company and Allscripts each licensed certain intellectual property to the other party pursuant to a cross license agreement; (c) the Company agreed to provide certain transition services to Allscripts pursuant to a transition services agreement; and (d) the Company licensed certain software and agreed to sell certain hardware to Allscripts pursuant to a software license and supply agreement. The Company also agreed that Allscripts shall receive at least $500 per year in payments from bookings (the “Annual Minimum Commitment”). If the total payments received by Allscripts from bookings during such period are less than the Annual Minimum Commitment, the Company shall pay to Allscripts the difference between the Annual Minimum Commitment and the total amount received by Allscripts from bookings during such period. As of December 31, 2022 and December 31, 2021, the accrued Annual Minimum Commitment was $1,700 and $1,200, respectively. In the event of a Bookings Commitment shortfall at the end of the ten-year period, the Company may be obligated to pay 70% of the shortfall, subject to certain credits. The Company will earn 30% commission from Allscripts on each software referral transaction that results in a booking with Allscripts. The Company accounts for the Bookings Commitment at its estimated fair value over the life of the agreement. The Company values the Bookings Commitment, assumed upon the disposal of the provider/patient engagement solutions business, using a Monte Carlo Simulation model to calculate average payments due under the Bookings Commitment, based on management's estimate of its performance in securing bookings and resulting annual payments, discounted at the cost of debt based on a yield curve. The cost of debt used for discounting was between 12% and 13% at December 31, 2022 and 11% at December 31, 2021. The change in fair value is recorded within other expense, net in the Company's Consolidated Statements of Operations. The fair value of the Bookings Commitment is dependent on management's estimate of the probability of success on individual opportunities and the cost of debt applied in discounting the liability. The higher the probability of success on each opportunity, the lower the fair value of the Bookings Commitment liability. The lower the cost of debt applied, the higher the value of the liability. Convertible Note derivative liability In December 2016, the Company issued $107,000 in aggregate principal amount of 2016 Notes due December 15, 2021, of which $10,000 issued to a related party (see Note 9). The 2016 Notes include an interest make-whole feature whereby if a note holder converts any of the Convertible Notes one year after the last date of original issuance of the 2016 Notes, they are entitled, in addition to the other consideration payable or deliverable in connection with such conversion, to an interest make-whole payment equal to the sum of the present values of the scheduled payments, computed using a discount rate equal to 2.0%, of interest that would have been made on the 2016 Notes to be converted had such 2016 Notes remained outstanding from the conversion date through the earlier of (i) the date that is three years after the conversion date and (ii) the maturity date if the 2016 Notes had not been so converted. The Company may pay any interest make-whole payment either in cash or in shares of its common stock, at the Company’s election as described in the Indenture. The Company has determined that this feature is an embedded derivative. The fair value of the derivative liability includes the estimated volatility and risk-free rate. The higher/lower the estimated volatility, the higher/lower the value of the liability. The higher/lower the risk-free interest rate, the higher/lower the value of the liability. As of December 15, 2021, the 2016 Notes were fully repaid. The fair market value for level 3 securities may be highly sensitive to the use of unobservable inputs and subjective assumptions. Generally, changes in significant unobservable inputs may result in significantly lower or higher fair value measurements. The following tables set forth a summary of changes in the fair value of Level 3 liabilities for the years ended December 31, 2022 and 2021: December 31, 2021 Transfers in (out) (1) Change in fair value recognized in earnings December 31, 2022 Liabilities Bookings Commitment 34,474 (500) 2,889 36,863 $ 34,474 $ (500) $ 2,889 $ 36,863 December 31, 2020 Transfers in (out) (1) Change in fair value recognized in earnings December 31, 2021 Liabilities Interest make-whole derivative - related party and others $ 4 $ — $ (4) $ — Bookings Commitment 32,651 (500) 2,323 34,474 $ 32,655 $ (500) $ 2,319 $ 34,474 (1) Transfers out of the Bookings Commitment fair value liability relates to the Annual Minimum Commitment, which was recorded in accrued and other current liabilities. Fair Value of Convertible Notes held at amortized cost As of December 31, 2022 and 2021, the fair value and carrying value of the Company's convertible notes were: Fair value Carrying value Face value 2021 Notes Balance as of December 31, 2022 Related party $ 48,125 $ 62,335 $ 62,500 Others 57,750 74,683 75,000 $ 105,875 $ 137,018 $ 137,500 Fair value Carrying value Face value 2021 Notes Balance as of December 31, 2021 Related party $ 51,466 $ 62,268 $ 62,500 Others 61,760 74,603 75,000 $ 113,226 $ 136,871 $ 137,500 The fair value of the 2021 Notes was determined by using unobservable inputs that are supported by minimal non-active market activity and that are significant to determining the fair value of the debt instrument. The fair value is level 3 in the fair value hierarchy. |
Leases
Leases | 12 Months Ended |
Dec. 31, 2022 | |
Leases [Abstract] | |
Leases | Leases The Company has operating leases for corporate offices, data centers, and certain equipment. The Company's leases have lease terms of 1 year to 11 years, some of which include options to extend the leases for up to 5 years, and some of which include options to terminate the leases within 1 year. Options to extend are included in the lease term where the Company is reasonably certain to exercise the options. Variable payments on the Company's leases are expensed as incurred, as they do not depend on an index or rate. The Company concluded certain leases for data centers had a term of less than 1 year at inception, as arrangements are only renewed following marketplace assessments and negotiations with vendors. The Company's leases do not indicate the rate implicit in the lease. As such, the Company has used its incremental borrowing rate, determined based on market indications of the rate at which the Company could borrow, adjusted for the term, value and payment schedule of individual leases, at the effective date for ASC 842 or at the lease commencement date for leases entered into after January 1, 2019. In June 2022, the Company entered into a sublease for 27 percent of our Boston office space which commenced in October 2022. The Company recorded an ROU asset impairment charge in the third quarter of 2022 of $208, which was the amount by which the carrying value of the ROU asset allocated to the sublease exceeded the fair value. The Company estimated the fair value of the ROU asset using an income approach based on the net present value of the sublease rental income during the sublease term. The ROU asset impairment charge is included in other income (expense), net. Lease expense, charged to selling, general and administrative expense, for the year ended December 31, 2022 and 2021 consisted of: Year Ended December 31, 2022 2021 Operating lease cost $ 2,210 $ 2,308 Short-term lease cost 666 738 Variable cost 395 590 Sublease income (52) (74) Total lease cost $ 3,219 $ 3,562 Other information regarding the Company's leases: Year Ended December 31, 2022 2021 Operating cash flows for operating leases $ (2,653) $ (2,717) Weighted average remaining lease term - operating leases 3.5 years 4.3 years Weighted average discount rate - operating leases 11 % 11 % As of December 31, 2022 and 2021, the Company had no finance leases. As of December 31, 2022, the remaining lives of the Company's operating leases ranged from one Maturities of the Company's operating leases at December 31, 2022 were as follows: Amounts 2023 $ 2,657 2024 2,503 2025 650 2026 589 2027 427 Thereafter 660 Total future minimum lease payments 7,486 Less: imputed interest (1,327) Total $ 6,159 As reported in the Consolidated Balance Sheet Accrued and other current liabilities $ 2,105 Operating lease liabilities 4,054 $ 6,159 |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies The Company's principal commitments consist of obligations under its outstanding debt obligations, noncancellable leases for its office space and certain equipment and vendor contracts to provide research services, and purchase obligations under license agreements and reseller agreements. Related Party Promissory Note On January 4, 2016, the Company executed a $112,666 demand promissory note in favor of Nant Capital to fund the acquisition of NaviNet (see Note 17). On May 9, 2016 and December 16, 2016, the Nant Capital Note was amended and restated to provide that all outstanding principal and accrued and unpaid interest is due and payable on June 30, 2021, and not on demand. On April 27, 2021, in connection with the issuance of the 2021 Notes, we entered into a Third Amended and Restated Promissory Note which amends and restates its promissory note, dated January 4, 2016, as amended on May 9, 2016, and on December 16, 2016, between the Company and Nant Capital, to, among other things, extend the maturity date of the promissory note to October 1, 2026 and to subordinate the promissory note in right of payment to the 2021 Notes (see Note 9). Indenture Obligations Under 2016 and 2021 Notes On December 21, 2016, the Company entered into the Indenture relating to the issuance of the 2016 Notes, by and between the Company and U.S. Bank National Association the Trustee. The interest rates are fixed at 5.5% per year, payable semi-annually on June 15th and December 15th of each year, beginning on June 15, 2017. The 2016 Notes matured on December 15, 2021 and were fully repaid (see Note 9). On April 27, 2021, the Company and the Guarantor entered into an indenture (the “2021 Indenture”) by and among NantHealth, the Guarantor and U.S. Bank National Association, as trustee (the “Trustee”), pursuant to which the Company issued the 2021 Notes. The 2021 Notes will bear interest at a rate of 4.5% per year, payable semi-annually on April 15 and October 15 of each year, beginning on October 15, 2021. The 2021 Notes will mature on April 15, 2026, unless earlier repurchased, redeemed or converted. The following events are considered “events of default” with respect to the 2021 Notes, which may result in the acceleration of the maturity of the 2021 Notes: (1) the Company defaults in any payment of interest on the 2021 Notes when due and payable and the default continues for a period of 30 days; (2) the Company defaults in the payment of principal on the 2021 Notes when due and payable at the stated maturity, upon redemption, upon any required repurchase, upon declaration of acceleration or otherwise; (3) failure by the Company to comply with its obligation to convert the 2021 Notes in accordance with the 2021 Indenture upon exercise of a holder’s conversion right and such failure continues for a period of five business days; (4) failure by the Company to give a fundamental change notice or notice of a specified corporate transaction when due with respect to the 2021 Notes; (5) failure by the Company to comply with its obligations under the 2021 Indenture with respect to consolidation, merger and sale of assets of the Company; (6) failure by the Company to comply with any of its other agreements contained in the 2021 Notes or the 2021 Indenture, for a period 60 days after written notice from the Trustee or the holders of at least 25% in principal amount of the 2021 Notes then outstanding has been received; (7) default by the Company or any of its significant subsidiaries (as defined in the 2021 Indenture) with respect to any mortgage, agreement or other instrument under which there may be outstanding, or by which there may be secured or evidenced, any indebtedness for money borrowed in excess of $17,500 (or its foreign currency equivalent) in the aggregate of the Company and/or any such subsidiary, whether such indebtedness now exists or shall hereafter be created (i) resulting in such indebtedness becoming or being declared due and payable or (ii) constituting a failure to pay the principal of any such indebtedness when due and payable at its stated maturity, upon required repurchase, upon declaration of acceleration or otherwise, and, in the case of clauses (i) and (ii), such default is not rescinded or annulled or such failure to pay or default shall not have been cured or waived, such acceleration is not rescinded or such indebtedness is not discharged, as the case may be, within 30 days after notice to the Company by the Trustee or to the Company and the Trustee by holders of at least 25% in aggregate principal amount of 2021 Notes then outstanding in accordance with the 2021 Indenture; or (8) certain events of bankruptcy, insolvency, or reorganization of the Company or any of its significant subsidiaries (as defined in the 2021 Indenture). If such an event of default, other than an event of default described in clause (8) above with respect to the Company, occurs and is continuing, the Trustee by notice to the Company, or the holders of at least 25% in principal amount of the outstanding 2021 Notes by notice to the Company and the Trustee, may, and the Trustee at the request of such holders shall, declare 100% of the principal of and accrued and unpaid interest, if any, on all the 2021 Notes to be due and payable. In case of certain events of bankruptcy, insolvency or reorganization involving the Company, 100% of the principal of and accrued and unpaid interest on the 2021 Notes will automatically become due and payable. Upon such a declaration of acceleration, such principal and accrued and unpaid interest on the 2021 Notes, if any, will be due and payable immediately. Regulatory Matters The Company is subject to regulatory oversight by the U.S. Food and Drug Administration and other regulatory authorities with respect to the development, manufacturing, and sale of some of the solutions. In addition, the Company is subject to the Health Insurance Portability and Accountability Act (“HIPAA”), the Health Information Technology for Economic and Clinical Health Act and related patient confidentiality laws and regulations with respect to patient information. The Company reviews the applicable laws and regulations regarding effects of such laws and regulations on its operations on an on-going basis and modifies operations as appropriate. The Company believes it is in substantial compliance with all applicable laws and regulations. Failure to comply with regulatory requirements could have a significant adverse effect on the Company’s business and operations. Legal Matters The Company is, from time to time, subject to claims and litigation that arise in the ordinary course of its business. Except as discussed below, in the opinion of management, the ultimate outcome of proceedings of which management is aware, even if adverse to the Company, would not have a material adverse effect on the Company’s consolidated financial condition or results of operations. Regardless of the outcome, litigation can have an adverse impact on the Company because of defense and settlement costs, diversion of management resources and other factors. Securities and Derivative Litigation In April 2018, two putative shareholder derivative actions, captioned Engleman v. Soon-Shiong, Case No. 2018-0282, and Petersen v. Soon-Shiong, Case No. 2018-0302 were filed in the Delaware Court of Chancery. The plaintiff in the Engleman action previously filed a similar complaint in California Superior Court, Los Angeles County, which was dismissed based on a provision in the Company’s charter requiring derivative actions to be brought in Delaware. The Engleman and Petersen complaints contain allegations similar to those in the Deora action but asserted causes of action on behalf of NantHealth against various of the Company’s current or former executive officers and directors for alleged breaches of fiduciary duty, abuse of control, gross mismanagement, waste of corporate assets, and unjust enrichment. The Company is named solely as a nominal defendant. In July 2018, the court issued an order consolidating the Engleman and Petersen actions as In re NantHealth, Inc. Stockholder Litigation, Lead C.A. No. 2018-0302, appointing Petersen as lead plaintiff, and designating the Petersen complaint as the operative complaint. On September 20, 2018, the defendants moved to dismiss the complaint. In October 2018, in response to the motion to dismiss, Petersen filed an amended complaint. In November 2018, the defendants moved to dismiss the amended complaint, which asserts claims for breach of fiduciary duty, waste of corporate assets (which Petersen subsequently withdrew), and unjust enrichment. On January 14, 2020, the court issued an order granting in part and denying in part the defendants’ motion to dismiss. The court dismissed all claims except one claim against Dr. Patrick Soon-Shiong for breach of fiduciary duty. Dr. Soon-Shiong and the Company filed answers to the amended complaint on March 30, 2020. On June 29, 2021, the Court granted the Unopposed Motion to Substitute Lead Plaintiff, following Plaintiff Petersen’s sale of his NantHealth stock, and appointed Engleman as Lead Plaintiff. On September 26, 2022, the parties filed with the Court a Stipulation for Compromise and Settlement to resolve the consolidated action in exchange for (i) the payment of $400, to be funded by the Company's insurance carriers, to offset the Company’s contribution to the settlement of the Deora action, and (ii) agreeing to implement certain corporate governance reforms. Additionally, the Company agreed to pay an award of attorneys’ fees and expenses to counsel for Lead Plaintiff in an amount of $1,250, to be funded by the Company's insurance carriers. The Court approved the settlement on January 10, 2023 and, as a result, the consolidated derivative action was dismissed. The Company is required to implement the settlement’s corporate governance reforms within 60 days following the approval. The settlement payment was received in January 2023. Insurance We purchase property, business interruption and related insurance coverage to mitigate the financial impact of catastrophic events or perils that is subject to deductible provisions based on the terms of the policies. These policies are on an occurrence basis. In addition, we also purchase cyber liability insurance from third parties. In August 2022, the Company became aware of unauthorized activity in a customer’s account, which involved fraudulent redirections of payments, unauthorized access to certain protected health information, and caused us to incur costs to respond to the incident. The Company took immediate steps to contain the incident and enhanced its security measures to prevent any further unauthorized access. The Company also retained forensic information technology firms and legal counsel to investigate the incident. Approximately $100 in legal and professional fees have been incurred as part of our response and investigation into this incident and these costs are included in accrued and other current liabilities as of December 31, 2022 on the Consolidated Balance Sheets. While the investigation is ongoing, the Company cannot be certain of the magnitude of a particular outcome, but recorded an estimated liability of $220 for possible claims tied to this incident, which is included in accrued and other current liabilities on the Consolidated Balance Sheets at December 31, 2022. There is a reasonable possibility of losses in excess of the amount accrued although the amount of such reasonably possible losses cannot be determined and the Company believes it would have the ability to recover any such losses from its insurance coverage. The Company has reflected its right to insurance recoveries, limited to the extent of incurred or probable losses, as a receivable when such recoveries have been agreed to with the Company’s third-party insurers and receipt is deemed probable. This includes instances where the Company’s third-party insurers have agreed to pay, on the Company’s behalf, certain legal defense costs and settlement amounts directly to applicable law firms and a settlement fund. The amount of such receivable related to the securities litigation recorded at December 31, 2022 and 2021 was $1,250 and $0, respectively, and is included in prepaid expenses and other current assets on the Consolidated Balance Sheets. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2022 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes The amount of loss before taxes from continuing operations is as follows: Year Ended 2022 2021 U.S. loss before taxes $ (68,683) $ (58,928) Foreign income before taxes 587 459 Loss before income taxes $ (68,096) $ (58,469) The components of the (provision for) benefit from income taxes are presented in the following table: Year Ended 2022 2021 Current: Federal — — State $ 177 $ 89 Foreign 84 68 Total current provision 261 157 Deferred: Federal (2) (2) State (515) (45) Foreign (61) (13) Total deferred benefit (578) (60) Less: (Benefit from) provision for income taxes from discontinued operations, net — — Provision for (benefit from) income taxes from continuing operations, net $ (317) $ 97 The provision for income taxes differs from the amount of income tax determined by applying the applicable U.S. statutory federal income tax rate to pretax loss as a result of the following differences: Year Ended 2022 2021 United States federal tax at statutory rate 21.00 % 21.00 % Items affecting federal income tax rate: State tax, net of federal benefit 3.50 % 6.51 % Valuation allowance (27.13) % (37.34) % R&D credit 2.38 % 9.47 % NOL expiration (1.73) % (1.69) % State differential 1.52 % — % Other adjustments 0.93 % 1.89 % Effective income tax rate 0.47 % (0.16) % On June 29, 2020, the state of California enacted Assembly Bill No. 85 ("AB 85") suspending California net operating loss utilization and imposing a cap on the amount of business incentive tax credits companies can utilize, effective for tax years 2020, 2021 and 2022. There was no material impact from the provisions of AB 85 for the years ended December 31, 2022 and 2021. As of December 31, 2022 and 2021, the Company had an immaterial amount of unremitted earnings related to certain foreign subsidiaries. The Company intends to continue to reinvest its foreign earnings indefinitely and does not expect to incur any significant taxes related to such amounts. Significant components of the Company’s deferred tax assets and liabilities as of December 31, 2022 and 2021 are as follows: December 31, 2022 2021 Deferred income tax assets: Accounts payable and accrued expenses $ 11,387 $ 10,786 163(j) interest limitation 14,131 10,693 Deferred revenue 291 159 Allowance for doubtful accounts 88 83 Property, plant and equipment, net 490 396 Intangibles 592 125 Section 174 capitalized R&D 5,946 — Investments 61,096 60,185 Stock-based compensation 2,530 1,612 Operating lease liabilities 1,667 2,249 Research and development tax credits 7,900 5,533 Net operating loss carryforwards 121,998 119,486 Less: Valuation allowance (205,552) (187,075) Total deferred income tax assets 22,564 24,232 Deferred income tax liabilities: State taxes (8,932) (7,867) Intangible assets, net (12,901) (15,535) Convertible notes — — Deferred costs to obtain a customer contract (173) (226) Capitalized labor costs (237) (344) Other (368) (361) Operating lease right-of-use assets (1,159) (1,674) Total deferred income tax liabilities (23,770) (26,007) Deferred income taxes, net $ (1,206) $ (1,775) The realization of deferred income tax assets may be dependent on the Company’s ability to generate sufficient income in future years in the associated jurisdiction to which the deferred tax assets relate. The Company considers all available positive and negative evidence, including scheduled reversals of deferred income tax liabilities, projected future taxable income, tax planning strategies, and recent financial performance. Based on the review of all positive and negative evidence, including a three-year cumulative pre-tax loss, the Company concluded that except for the deferred tax liability recorded on amortization of certain goodwill due to its indefinite life and deferred tax liability in excess of deferred tax asset for certain separate state and city jurisdictions, it should record a full valuation allowance against all other net deferred income tax assets at December 31, 2022 and 2021 as none of these deferred income tax assets were more likely than not to be realized as of the balance sheet dates. However, the amount of the deferred income tax assets considered realizable may be adjusted if estimates of future taxable income during the carryforward period are increased or if objective negative evidence in the form of cumulative losses is no longer present. Based on the level of historical operating results the Company has recorded a valuation allowance of $205,552 and $187,075 as of December 31, 2022 and 2021, respectively. The change in the valuation allowance for the years ended December 31, 2022 and 2021 were increases of $18,477 and $23,356, respectively, which were mainly driven by losses from which the Company cannot benefit. The portion of the valuation allowance for deferred tax assets for which subsequently recognized tax benefits will be credited directly to contributed capital is $358. As of December 31, 2022, the Company had federal and state NOL carryforwards of $461,012 and $333,515, respectively, available to offset taxable income in tax year 2023 and thereafter. Of the $461,012 in Federal NOL carryforwards, $112,276 can be carried forward indefinitely and the remaining NOL carryforwards start to expire in 2023. Of the $333,515 in state NOL carryforwards $23,049 can be carried forward indefinitely and the remaining start to expire in 2023. As of December 31, 2022, the Company also had Federal research tax credit carryforwards of $8,442. The Federal research tax credit carryforwards expire beginning in 2037. The Company is no longer subject to income tax examination by the U.S. federal, state or local tax authorities for years ended December 31, 2017 or prior; however, its tax attributes, such as NOL carryforwards and tax credits, are still subject to examination in the year they are used. Federal and state laws impose restrictions on the utilization of net operating loss carryforwards and research and development credit carryforwards in the event of a change in ownership of the Company as defined by Internal Revenue Code Section 382 and 383. The Company experienced an ownership change in the past that impacts the availability of its net operating losses and tax credits. The amounts indicated in the above tables reflect the reduction of net operating losses and credit carryforwards as a result of previous ownership changes that the Company experienced. Should there be additional ownership changes in the future, the Company's ability to utilize existing carryforwards could be substantially restricted. A summary of changes to the amount of unrecognized tax benefits is as follows: 2022 Unrecognized tax benefits as of December 31, 2021 $ 1,123 Increases related to prior year tax positions taken during the current year 68 Increases related to current year tax positions taken during the current year 190 Unrecognized tax benefits as of December 31, 2022 $ 1,381 The Company records a tax benefit from uncertain tax positions only if it is more likely than not the tax position will be sustained with the taxing authority having full knowledge of all relevant information. The Company records a reduction to deferred tax assets for unrecognized tax benefits from uncertain tax positions as discrete tax adjustments in the first period that the more-likely-than-not threshold is not met. For the years ended December 31, 2022 and December 31, 2021, the Company recorded unrecognized tax benefits of $1,381 and $1,123, respectively related to Federal Research and Development tax credits recognized in 2022 and 2021, respectively. The reversal of the uncertain tax benefits would not affect the effective tax rate to the extent that the Company continues to maintain a full valuation allowance against its deferred tax assets. The Company does not anticipate any significant changes to unrecognized tax benefits over the next 12 months. The Company has not incurred any material interest or penalties as of the current reporting period with respect to income tax matters. The Company’s policy is to recognize interest and penalties related to uncertain tax positions in income tax expense. As of December 31, 2022 and 2021, there were no material interest and penalties associated with unrecognized tax benefits recorded in the Company's Consolidated Statements of Operations or Consolidated Balance Sheets. Any changes to unrecognized tax benefits recorded as of December 31, 2022 that are reasonably possible to occur within the next 12 months are not expected to be material. |
Stockholders' Equity (Deficit)
Stockholders' Equity (Deficit) | 12 Months Ended |
Dec. 31, 2022 | |
Equity [Abstract] | |
Stockholders' Equity (Deficit) | Stockholders’ Equity (Deficit) In accordance with the Company’s amended and restated certificate of incorporation, which was filed immediately following the closing of its IPO, the Company is authorized to issue 750,000,000 shares of common stock, with a par value of $0.0001 per share, and 20,000,000 shares of undesignated preferred stock, with a par value of $0.0001 per share. Holders of the Company’s common stock are entitled to one vote for each share held on all matters submitted to a vote of its stockholders. Holders of the Company’s common stock have no cumulative voting rights. Further, as of December 31, 2022 and 2021, holders of the Company’s common stock have no preemptive, conversion, redemption or subscription rights and there are no sinking fund provisions applicable to the Company’s common stock. Upon liquidation, dissolution or winding-up of the Company, holders of the Company’s common stock are entitled to share ratably in all assets remaining after payment of all liabilities and the liquidation preferences of any outstanding shares of preferred stock. Subject to preferences that may be applicable to any outstanding shares of preferred stock, holders of the Company’s common stock are entitled to receive dividends, if any, as may be declared from time to time by the Company’s board of directors. As of December 31, 2022 and 2021, there were no outstanding shares of preferred stock. In August 2022, our Board of Directors approved a reverse stock split of our common stock at a ratio of 1-for-15, which became effective on December 15, 2022. Accordingly, all stock, equity award, and per share amounts have been adjusted to reflect the reverse stock split for all prior periods presented. On April 13, 2021, the Company exchanged with Cambridge and Highbridge, $10,000 principal of the 2016 Notes ($5,000 with each party, respectively), for 112,612 and 128,452 common shares, respectively (See Note 9). |
Stock-Based Compensation
Stock-Based Compensation | 12 Months Ended |
Dec. 31, 2022 | |
Share-Based Payment Arrangement [Abstract] | |
Stock-Based Compensation | Stock-Based Compensation In August 2022, our Board of Directors approved a reverse stock split of our common stock at a ratio of 1-for-15, which became effective on December 15, 2022. Accordingly, all stock, equity award, and per share amounts have been adjusted to reflect the reverse stock split for all prior periods presented. The following table reflects the components of stock-based compensation expense recognized in the Company's Consolidated Statements of Operations: Year Ended 2022 2021 Stock options: Cost of revenue $ 152 $ 188 Selling, general and administrative 3,891 3,012 Research and development 475 424 Total stock options stock-based compensation expense 4,518 3,624 Restricted stock units: Selling, general and administrative 107 128 Total restricted stock units stock-based compensation expense 107 128 Related party share based payments Selling, general and administrative 19 67 Research and development 21 68 Total related party stock-based compensation expense 40 135 Total stock-based compensation expense 4,665 3,887 Amount capitalized to internal-use software 103 118 Total stock-based compensation cost $ 4,768 $ 4,005 2016 Equity Incentive Plan In May and June of 2016, the Company’s Board of Directors adopted and the Company’s stockholders approved the 2016 Equity Incentive Plan (the "2016 Plan”) in connection with the Company’s IPO. The 2016 Plan provides for the grant of incentive stock options, non-statutory stock options, restricted stock, restricted stock units, stock appreciation rights, performance units and performance shares to employees, directors and consultants. A total of 1,853,333 shares of common stock were reserved for issuance pursuant to the 2016 Plan. There are 654,937 shares available to be issued under the 2016 plan as of December 31, 2022. The Company intends to settle all vested restricted stock unit payments held by United States-based participants, except for certain awards to the Chief Operating Officer, in shares of the Company’s common stock and the Company classify these awards as equity awards in its Consolidated Balance Sheets. Awards held by participants who are based outside of the United States, and those awards agreed with participants to be settled in cash, will be settled in cash and are classified within accrued and other current liabilities in the Consolidated Balance Sheets as of December 31, 2022 and 2021. In order to satisfy payroll withholding tax obligations triggered by the issuance of shares of common stock to holders of restricted stock units, the Company issues recipients a net lower number of shares of common stock to satisfy tax withholding obligations and remitted a cash payment for the related withholding taxes. Stock Options Stock-based compensation expense is calculated based on the grant date fair value of the award and the attribution of that cost is being recognized ratably over requisite service periods of 1 to 4 years. Stock options expire ten years from the date of grant. Because we do not have a history of stock option awards to provide a reliable basis for estimating the expected term the expected term is determined using the "simplified method", whereby the expected term equals the arithmetic average of the vesting terms and the original contractual term of the option . The Company has utilized the Black-Scholes option-pricing model to determine the fair value of stock options based on the closing price of the Company’s common stock on the NASDAQ Composite Index on the date of grant. The following table summarizes the weighted-average assumptions used to value stock options at their grant date and the weighted-average grant-date fair value per share: Year Ended December 31, 2022 2021 Expected volatility 70.89 % 70.37 % Expected term to exercise from grant date 5.6 years 6.0 years Risk-free rate 3.20 % 0.94 % Expected dividend yield — % — % Weighted-average grant-date fair value per share of options $ 5.42 $ 5.97 The following table summarizes the activity related to stock options during the years ended December 31, 2022 and 2021: Number of Weighted-Average Weighted-Average Remaining Contractual Life Aggregate Intrinsic Value Stock options outstanding - December 31, 2020 665,317 $ 32.7 9.1 years $ 13,372 Granted 472,655 $ 29.98 Exercised (33,627) $ 8.25 $ 915 Forfeited (139,328) $ 42.06 $ 743 Stock options outstanding - December 31, 2021 965,017 $ 30.87 8.8 years $ 1,987 Granted 30,330 $ 8.57 Exercised (3,000) $ 8.25 $ 14 Forfeited (88,248) $ 33.62 $ 4 Stock options outstanding - December 31, 2022 904,099 $ 29.93 7.9 years $ — Stock options exercisable - December 31, 2022 517,842 $ 26.05 7.5 years $ — As of December 31, 2022, the number, weighted-average exercise price, weighted-average remaining contractual term, and aggregate intrinsic value of the Company's aggregate stock options that either had vested or are expected to vest approximate the corresponding amounts for stock options outstanding. As of December 31, 2022, the Company had $7,002 of unrecognized stock-based compensation expense related to the stock options. This cost is expected to be recognized over a weighted-average period of 1.6 years. The Company settles all exercised stock options by issuing shares of the Company's common stock without netting down the portion related to payroll withholding tax obligations. Restricted Stock Units The grant date fair value of the restricted stock units is determined based on the closing price of the Company’s common stock on the NASDAQ Composite Index on the date of grant. Each grant of restricted stock units made to a participant vests over a requisite service period of 1 to 4 years. The Company intends to settle all vested restricted stock unit payments held by United States-based participants in shares of the Company’s common stock and classifies these awards as equity awards in its Consolidated Balance Sheets. Awards held by participants who are based outside of the United States will be settled in cash and are classified within accrued and other current liabilities in the Consolidated Balance Sheets as of December 31, 2022 and 2021. The following table summarizes the activity related to the unvested restricted stock units during the years ended December 31, 2022 and 2021: Number of Units Weighted-Average Grant-Date Fair Value Unvested restricted stock units outstanding - December 31, 2020 16,886 $ 24.62 Vested (7,906) $ 22.84 Forfeited (1,000) $ 18.45 Unvested restricted stock units outstanding - December 31, 2021 7,980 $ 27.15 Vested (3,990) $ 27.15 Unvested restricted stock units outstanding - December 31, 2022 3,990 $ 27.15 Vested and unvested restricted stock units outstanding - December 31, 2022 7,980 $ 27.15 Unrecognized compensation expense related to unvested restricted stock units was $20 at December 31, 2022, which is expected to be recognized as expense over the weighted-average period of 0.2 years. The total fair value of RSUs that vested during the years ended December 31, 2022 and 2021 was $108 and $385, respectively. During the years ended December 31, 2022 and 2021, the Company issued 0 and 6,669 shares, respectively, of common stock to participants of the 2016 Plan based in the United States, after withholding approximately 0 and 1,237 shares, respectively, to satisfy tax withholding obligations. The Company made a cash payment of $0 and $50 to cover employee withholding taxes upon the settlement of these vested restricted stock units during the years ended December 31, 2022 and 2021, respectively. |
Net Income (Loss) Per Share
Net Income (Loss) Per Share | 12 Months Ended |
Dec. 31, 2022 | |
Earnings Per Share [Abstract] | |
Net Income (Loss) Per Share | Net Income (Loss) Per Share In August 2022, our Board of Directors approved a reverse stock split of our common stock at a ratio of 1-for-15, which became effective on December 15, 2022. Accordingly, all stock, equity award, and per share amounts have been adjusted to reflect the reverse stock split for all prior periods presented. The following table sets forth reconciliations of the numerators and denominators used to compute basic and diluted net loss per share of common stock attributable to NantHealth for the years ended December 31, 2022 and 2021: Year Ended December 31, 2022 2021 Net income (loss) per share numerator: Net income (loss) from continuing operations $ (67,779) $ (58,566) Net income (loss) attributable to noncontrolling interests — (284) Net income (loss) from continuing operations attributable to NantHealth (67,779) (58,282) Income (loss) from discontinued operations, net of tax, attributable to NantHealth — 23 Net income (loss) for basic and diluted net loss per share $ (67,779) $ (58,259) Weighted-average shares for basic net income (loss) per share 7,702,872 7,609,906 Effect of dilutive securities — — Weighted-average shares for dilutive net income (loss) per share 7,702,872 7,609,906 Basic and diluted net income (loss) per share attributable to NantHealth: Continuing operations - common stock $ (8.80) $ (7.66) Total net income (loss) per share - common stock $ (8.80) $ (7.66) The following number of potential common shares at the end of each period were excluded from the calculation of diluted net loss per share attributable to common stockholders because their effect would have been anti-dilutive for the periods presented: Year Ended 2022 2021 Unexercised stock options 904,099 965,017 Unvested restricted stock units 3,990 7,980 Convertible notes 2,382,190 2,382,190 |
Related Party Transactions
Related Party Transactions | 12 Months Ended |
Dec. 31, 2022 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | Related Party Transactions NantWorks Shared Services Agreement In October 2012, the Company entered into a shared services agreement with NantWorks that provides for ongoing services from NantWorks in areas such as public relations, information technology and cloud services, human resources and administration management, finance and risk management, environmental health and safety, sales and marketing services, facilities, procurement and travel, and corporate development and strategy (the "Shared Services Agreement"). The Company is billed quarterly for such services at cost, without mark-up or profit for NantWorks, but including reasonable allocations of employee benefits, facilities and other direct or fairly allocated indirect costs that relate to the associates providing the services. NantHealth also bills NantWorks and affiliates for services such as information technology and cloud services, finance and risk management, and facilities management, on the same basis. During the years ended December 31, 2022 and 2021, the Company recognized an expense of $1,328 and income of $561, respectively, in selling, general and administrative expenses for services provided to the Company by NantWorks and affiliates, net of services provided to NantWorks and affiliates. Nant Capital Note Purchase Agreement On April 13, 2021, the Company entered into a Note Purchase Agreement with Nant Capital to issue and sell $62,500 in aggregate principal amount of its 2021 Notes (see Note 9). The accrued and unpaid interest on the 2021 Notes held by Nant Capital was $689 at December 31, 2022 and $586 at December 31, 2021, respectively, and was included as part of current related party payables, net in the Consolidated Balance Sheets. Related Party Receivables and Payables As of December 31, 2022 and 2021, the Company had related party receivables, net of related party payables, of $1,413 and $1,518, respectively, primarily consisting of a receivable from Ziosoft KK of $1,041 and $1,144, respectively, which was related to the sale of Qi Imaging. As of December 31, 2022 and 2021, the Company had related party payables, net of related party receivables, and related party liabilities of $47,841 and $43,439, respectively, which primarily relate to interest payable on the $112,666 promissory note in favor of Nant Capital and amounts owed to NantWorks pursuant to the Shared Services Agreement. The balance of the related party receivables and payables represent amounts paid by affiliates on behalf of the Company or vice versa. Amended Reseller Agreement On June 19, 2015, the Company entered into a five and a half year exclusive Reseller Agreement with NantOmics for sequencing and bioinformatics services (the "Original Reseller Agreement"). NantOmics is a majority owned subsidiary of NantWorks and is controlled by the Company's Chairman and CEO. On May 9, 2016, the Company and NantOmics executed an Amended and Restated Reseller Agreement (the “Amended Reseller Agreement”), pursuant to which the Company received the worldwide, exclusive right to resell NantOmics’ quantitative proteomic analysis services, as well as related consulting and other professional services, to institutional customers (including insurers and self-insured healthcare providers) throughout the world. The Company retained its existing rights to resell NantOmics’ molecular analysis and bioinformatics services. Under the Amended Reseller Agreement, the Company is responsible for various aspects of delivering its sequencing and molecular analysis solutions, including patient engagement and communications with providers such as providing interpretations of the reports delivered to the physicians and resolving any disputes, ensuring customer satisfaction, and managing billing and collections. On September 20, 2016, the Company and NantOmics further amended the Amended Reseller Agreement (the "Second Amended Reseller Agreement"). The Second Amended Reseller Agreement permits the Company to use vendors other than NantOmics to provide any or all of the services that are currently being provided by NantOmics and clarifies that the Company is responsible for order fulfillment and branding. The Second Amended Reseller Agreement grants to the Company the right to renew the agreement (with exclusivity) for up to three renewal terms, each lasting three years, if the Company achieves projected volume thresholds, as follows: (i) the first renewal option can be exercised if the Company completes at least 300,000 tests between June 19, 2015 and June 30, 2020; (ii) the second renewal option can be exercised if the Company completes at least 570,000 tests between July 1, 2020 and June 30, 2023; and (iii) the third renewal option can be exercised if the Company completes at least 760,000 tests between July 1, 2023 and June 30, 2026. If the Company does not meet the applicable volume threshold during the initial term or the first or second exclusive renewal terms, the Company can renew for a single additional three-year term, but only on a non-exclusive basis. The Company paid NantOmics noncancellable annual minimum fees of $2,000 per year for each of the calendar years from 2016 through 2020 and, subject to the Company exercising at least one of its renewal options described above. The Company was also required to pay annual minimum fees from 2021 through 2029. These annual minimum fees are no longer applicable with the execution of Amendment No. 3 to the Second Amended Reseller Agreement. On December 18, 2017, the Company and NantOmics executed Amendment No. 1 to the Second Amended Reseller Agreement. The Second Amended Reseller Agreement was amended to allow fee adjustments with respect to services completed by NantOmics between the amendment effective date of October 1, 2017 to June 30, 2018. On April 23, 2019, the Company and NantOmics executed Amendment No. 2 to the Second Amended Reseller Agreement. The Second Amended Reseller Agreement was amended to set a fixed fee with respect to services completed by NantOmics between the amendment effective date and the end of the Initial Term, December 31, 2020. On December 31, 2020, the Company and NantOmics executed Amendment No. 3 to the Second Amended Reseller Agreement to automatically renew at the end of December 2020 for a non-exclusive renewal term and to waive the annual minimum fee for the 2020 calendar year and calendar years 2021 through 2023. As of December 31, 2022 and 2021, the Company had $0 outstanding related party payables under the Second Amended Reseller Agreement. During the years ended December 31, 2022 and 2021, direct costs of $0 were recorded as cost of revenue related to the Second Amended Reseller Agreement. Cambridge Purchase Agreement On December 15, 2016, the Company entered into the Cambridge Purchase Agreement with Cambridge, an entity affiliated with the Company's Chairman and CEO, Dr. Soon-Shiong, to issue and sell $10,000 in aggregate principal amount of the 2016 Notes in a private placement pursuant to an exemption from the registration requirements of the Securities Act afforded by Section 4(a)(2) of the Securities Act. The Cambridge Purchase Agreement includes customary representations, warranties and covenants by the Company and customary closing conditions (see Note 9). On April 13, 2021, NantHealth entered into a transaction as part of the Exchange Agreement with Cambridge to exchange $5,000 principal amount of its $10,000 in existing 2016 Notes for shares of the Company’s common stock (see Note 9). On December 15, 2021, the Company paid the remaining $5,000 principal and accrued interest of $138. Related Party Promissory Notes In January 2016, the Company executed a demand promissory note with Nant Capital (the "Nant Capital Note"), a personal investment vehicle for Dr. Soon-Shiong, our Chairman and CEO. As of December 31, 2022, the total advances made by Nant Capital to the Company pursuant to the note was approximately $112,666. On May 9, 2016, the Nant Capital Note was amended and restated to provide that all outstanding principal and accrued and unpaid interest is due and payable on June 30, 2021, and not on demand. On December 15, 2016, in connection with the offering of the 2016 Notes, the Company entered into a Second Amended and Restated Promissory Note which amended and restated the Amended and Restated Promissory Note, dated May 9, 2016, between NantHealth and Nant Capital, to, among other things, extend the maturity date of the Nant Capital Note to June 15, 2022 and to subordinate the Nant Capital Note in right of payment to the 2016 Notes. The Nant Capital Note bears interest at a per annum rate of 5.0% compounded annually and computed on the basis of the actual number of days in the year. When a repayment is made, Nant Capital has the option, but not the obligation, to require NantHealth to repay any such amount in cash, Series A-2 units of NantOmics (based on a per unit price of $1.484) held by the Company, shares of its common stock based on a per share price of $279.1890 (if such equity exists at the time of repayment), or any combination of the foregoing at the sole discretion of Nant Capital. On April 27, 2021, in connection with the issuance of the 2021 Notes, the Company entered into a Third Amended and Restated Promissory Note which amends and restates its promissory note, dated January 4, 2016, as amended on May 9, 2016, and on December 16, 2016, between NantHealth and Nant Capital, to, among other things, extend the maturity date of the promissory note to October 1, 2026 and to subordinate the promissory note in right of payment to the 2021 Notes. On March 3, 2017, NantHealth Labs (formerly Liquid Genomics, Inc.), executed a promissory note with NantWorks. The principal amount of the advance made by NantWorks totaled $250 as of December 31, 2022. On June 30, 2017, the promissory note was amended and restated to provide that all outstanding principal and accrued and unpaid interest is due on demand. The note bears interest at a per annum rate of 5.0%, compounded annually. As of December 31, 2022, the total interest outstanding on this note amounted to $82 and is included in related party payables, net. On August 8, 2018, the Company executed a promissory note in favor of Nant Capital, with a maturity date of June 15, 2022. On December 31, 2021, the Company executed an agreement with Nant Capital to amend and restate the original promissory note, allowing it to request advances up to a maximum commitment of $125 that bears interest at a per annum rate of 5.5%, extended the maturity date to December 31, 2023, and created an option for the securitization of the debt under the promissory note upon full repayment of the 2016 Notes. Interest payments on outstanding amounts are due on December 15th of each calendar year. The promissory note includes customary negative covenants. On April 27, 2021, in connection with the issuance of the 2021 Notes, the Company and Nant Capital entered into a Second Amended and Restated Promissory Note which amends and restates its promissory note, dated August 8, 2018, as amended on December 31, 2021, between the Company and Nant Capital, to, among other things, extend the maturity date of the promissory note to December 31, 2026 and to subordinate the promissory note in right of payment to the 2021 Notes. The ability to request advances against this note expired as of December 31, 2022 and no advances had been made under the promissory note prior to expiration. As of December 31, 2022, the Company was in compliance with all covenants. On October 3, 2022, the Company entered into an unsecured subordinated promissory note (the “Airstrip Note”) with Airstrip Technologies, Inc., a Delaware corporation (“Airstrip”), whereby AirStrip loaned $4,000 to the Company. AirStrip is an entity affiliated with Dr. Patrick Soon-Shiong, our Chairman of the Board of Directors (the "Board") and Chief Executive Officer. The Airstrip Note contains an 8.5% interest rate compounded annually and a maturity date of October 31, 2026. The payment of the Airstrip Note shall be subordinated and subject in right of payment to the prior payment in full of all Senior Debt. On November 21, 2022, the Company entered into an unsecured subordinated promissory note (the “2022 Nant Capital Note”) with Nant Capital, whereby Nant Capital loaned $7,000 to the Company. Nant Capital is an entity affiliated with Dr. Patrick Soon-Shiong, our Chairman of the Board of Directors and Chief Executive Officer. The 2022 Nant Capital Note contains an interest rate equal to the Term Secured Overnight Financing Rate (“SOFR”) plus 8.5% per annum, compounded annually and a maturity date of October 31, 2026. The Nant Capital Note also contains semiannual interest payments due on April 15th and October 15th of each year. The payment of the 2022 Nant Capital Note shall be subordinated and subject in right of payment to the prior payment in full of all Senior Debt. Related Party Share-based Payments On December 21, 2020, ImmunityBio, Inc. (formerly known as NantKwest, Inc.) ("ImmunityBio"), NantCell, and Nectarine Merger Sub, Inc., a wholly owned subsidiary of ImmunityBio, entered into an Agreement and Plan of Merger, which was completed on March 9, 2021 (the "Merger"). The newly merged entity is majority owned by entities controlled by Dr. Soon-Shiong, Chairman and Chief Executive Officer of the Company. On March 4, 2021, prior to the Merger, NantCell awarded restricted stock units to its employees and employees of Immunity Bio, including certain NantHealth employees, which vest over defined service periods, subject to completion of a liquidity event. At the effective time of the Merger on March 9, 2021, the performance condition was met and each share of common stock of NantCell that was issued and outstanding immediately prior to the Merger was automatically converted into the right to receive as consideration newly issued common shares of ImmunityBio. The Company accounts for these awards as compensation cost at its estimated fair value over the vesting period with a corresponding credit to equity to reflect a capital contribution from, or on behalf of, the common controlling entity, to the extent that those services provided by its employees associated with these awards benefit NantHealth. The fair value is dependent on management's estimate of the benefit to NantHealth. The higher the estimate of benefit to the Company, the higher the fair value of compensation cost. The compensation cost attributed to NantHealth associated with these awards was $40 for the year ended December 31, 2022. |
Employee Retirement Plan
Employee Retirement Plan | 12 Months Ended |
Dec. 31, 2022 | |
Retirement Benefits [Abstract] | |
Employee Retirement Plan | Employee Retirement Plan The Company has a qualified defined contribution plan (the “NantHealth 401(k) Plan”) under Section 401(k) of the Internal Revenue Code covering eligible associates, including associates at certain of its subsidiaries. Associate contributions to the NantHealth 401(k) Plan are voluntary. The Company contributes a 100% match up to 3.0% of the participant’s eligible annual compensation, which contribution fully vests after three years of service. Participants’ contributions are limited to their annual tax deferred contribution limit as allowed by the Internal Revenue Service. For the years ended December 31, 2022 and 2021, the Company’s total matching contributions to the NantHealth 401(k) Plan were $702 and $608, respectively.In the fourth quarter of 2022 the Company established a Registered Retirement Savings Plan (RRSP) for our Canadian employees, "The Group Retirement Savings Plan (RSP) for the Employees of OpenNMS Group Canada". The Company contributes a 100% match up to 5.0% of the participants eligible annual compensation. The total matching contributions to the plan were $101 for the year ended December 31, 2022. |
Subsequent Event
Subsequent Event | 12 Months Ended |
Dec. 31, 2022 | |
Subsequent Events [Abstract] | |
Subsequent Event | Subsequent Event Credit Agreement with Nant Capital and Highbridge On March 2, 2023, the Company entered into a credit agreement (the “Credit Agreement”) with Nant Capital and Highbridge. The Credit Agreement provides for a senior secured term loan facility in an aggregate principal amount of $22.5 million in a single drawdown made by the Company at closing (the “Senior Secured Term Loan Facility”). The maturity date of the Senior Secured Term Loan Facility is December 15, 2023 (the “Maturity Date”) and accrues interest at an annual rate of 13% per annum with a 1% original issue discount. The proceeds from the Senior Secured Term Loan Facility will be used by the Company to fund working capital needs, expenditures and general corporate purposes of the Company. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2022 | |
Accounting Policies [Abstract] | |
Basis of Presentation and Principles of Consolidation | Basis of Presentation and Principles of ConsolidationThe accompanying Consolidated Financial Statements include the accounts of NantHealth and its subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation. These Consolidated Financial Statements have been prepared in accordance with accounting principles generally accepted in the United States of America ("GAAP"). The results of operations of the entities disposed of are included in the Consolidated Financial Statements up to the date of disposal and, where appropriate, these operations have been reflected as discontinued operations. |
Use of Estimates | Use of Estimates The preparation of Consolidated Financial Statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the Consolidated Financial Statements and accompanying notes. Actual results may differ from those estimates. The estimates and assumptions used in the accompanying Consolidated Financial Statements are based upon management’s evaluation of the relevant facts and circumstances at the balance sheet date. On an ongoing basis, the Company evaluates its estimates, including those related to revenue recognition, accounts receivable allowance, useful lives of long-lived assets and intangible assets, income taxes, stock-based compensation, impairment of long-lived assets and intangible assets, and the expected performance against minimum reseller commitments. The Company bases its estimates on historical experience and on various other assumptions that are believed to be reasonable, the results of which can affect the reported amounts of assets and liabilities as of the date of the financial statements, as well as the reported amounts of revenue and expenses during the periods presented. |
Segment Reporting | Segment Reporting The chief operating decision maker for the Company is its Chief Executive Officer. The Chief Executive Officer reviews financial information presented on a consolidated basis for purposes of allocating resources and evaluating financial performance. The Company has one business activity and there are no segment managers who are held accountable for operations, operating results, or plans for levels or components below the consolidated unit level. Accordingly, management has determined that the Company operates in one reportable segment. |
Revenue from Contracts with Customers | Revenue from Contracts with Customers Revenue is recognized upon transfer of control of promised products or services to customers in an amount that reflects the consideration the Company expects to receive in exchange for those products or services. Revenue is recognized net of sales taxes collected from customers, which are subsequently remitted to governmental authorities. The Company’s revenue is generated from the following sources: • Software-as-a-service (“SaaS”) related - SaaS related revenue is generated from customers’ access to and usage of the Company’s hosted software solutions on a subscription basis for a specified contract term. In SaaS arrangements, the customer cannot take possession of the software during the term of the contract and generally has the right to access and use the software and receive any software upgrades published during the subscription period. SaaS contracts are accounted for as a single performance obligation, as implementation and hosting services are not distinct. As a result, the Company recognizes all fees, including any up front initial system implementation service fees, or other fees, ratably over time from when the system implementation or deployment services are completed, and where necessary accepted by the customer, over the contract term, as stated, or with consideration of termination for convenience clauses as discussed below. • Maintenance - Maintenance revenue includes technical support and maintenance on OpenNMS software during the contract term. Revenue is recognized over the maintenance or support term. The Company’s networking monitoring solutions typically consist of a term-based subscription to the OpenNMS software license and maintenance, which entitle customers to unspecified software updates and upgrades on a when-and-if-available basis. The Company has determined that its promises to transfer the software license and the related maintenance are not separately identifiable because the licensed software and the software updates and upgrades are highly interdependent and highly interrelated, working together to deliver a continuously updated networking monitoring solution. The Company therefore considers the software license and related maintenance obligations to represent a single, combined performance obligation with revenue recognized over the subscription period. • Professional services - Professional services revenue is generated from consulting services to help customers install, integrate and optimize OpenNMS, sponsored development, and training to assist customers deploy and use OpenNMS solutions. Sponsored development relates to professional services to build customer specific functionality, features, and enhancements into the OpenNMS open source platform. Revenue is recognized over time for most of the Company's contracts as performance obligations are satisfied, as the Company is continuously transferring control to the customer. Typically, revenue is recognized over time using direct labor hours as a measure of progress. If any significant obligations to the customer remain post-delivery, typically involving obligations relating to acceptance by the customer, revenue recognition is deferred until such obligations have been fulfilled. Customers are generally billed as the Company satisfies its performance obligations. Billings under certain fixed-price contracts may be based upon the achievement of specified milestones. Management assesses whether contracts entered into at, or near, the same time, should be combined, based on evaluation of the commercial objectives of the contracts. Certain of the Company’s customer contracts allow for termination for convenience, with advanced notice, without substantive termination penalty. In these cases, the Company has concluded the contract term is equal to the remaining non-cancelable period. Such termination rights do not allow for refunds other than prepaid services. These provisions do not affect when the Company commences revenue recognition. Contracts with Multiple Promises for Goods and Services The Company engages in various contracts with promises for multiple goods and services, which may generate revenue across any of the sources noted above. In certain contracts, the Company recognizes its proprietary software, software license, technical support, maintenance, consulting services, sponsored development services, training, certain professional services, and other software-related services as distinct performance obligations. Standalone selling prices (“SSP”) are required to be allocated and revenue recognized for each distinct performance obligation within each contract. Judgment is required to determine the SSP for each distinct performance obligation. The SSP for each performance obligation is determined by considering contracts in which the good or service is sold separately and other factors, including market conditions and the Company’s experience selling similar goods and services, as well as costs and margins achieved. In some cases, to estimate the SSP, the Company first estimates the selling price of each performance obligation for which an SSP is observable and then estimates the SSP of the remaining performance obligation as the residual contractual amount. Generally, consulting and sponsored development professional services do not involve significant integration or customization of the OpenNMS software. As such, consulting and sponsored development are considered distinct performance obligations. The Company has reseller arrangements, and for each promised good or service, the Company evaluates whether it is a principal or an agent. The Company assesses control in terms of relevant indicators of performance, inventory, and pricing risk, such as which party negotiates pricing with the end customer and which party is ultimately responsible for fulfilling services, transferring goods and services, and ensuring support. |
Cost of Revenue | Cost of Revenue Cost of revenue includes associated salaries and fringe benefits, stock-based compensation, consultant costs, direct reimbursable travel expenses, depreciation related to software developed for internal use, depreciation related to lab equipment, and other direct engagement costs associated with the design, development, sale and installation of systems, including system support and maintenance services for customers. System support includes ongoing customer assistance for software updates and upgrades, installation, training and functionality. All service costs, except development of internal use software and deferred implementation costs, are expensed when incurred. Amortization of deferred implementation costs are also included in cost of revenue. Cost of revenue associated with each of the Company’s revenue sources consists of the following types of costs: • Software-as-a-service related - SaaS related cost of revenue includes personnel-related costs, amortization of deferred implementation costs, amortization of internal-use software, and other direct costs associated with the delivery and hosting of the Company's subscription services. • Maintenance - Maintenance cost of revenue includes personnel-related costs, amortization of internal-use software, and other direct costs associated with the ongoing support or maintenance provided to the Company’s customers. • Professional services - Professional services cost of revenue include personnel-related costs and other direct costs associated with consulting, sponsored development, and training provided to the Company's customers. |
Selling, General and Administrative Expenses | Selling, General and Administrative Expenses Selling, general and administrative expense consists primarily of personnel-related expenses for the Company's sales and marketing, finance, legal, human resources, administrative personnel, stock-based compensation, advertising and marketing promotions of NantHealth solutions, and corporate shared services fees from NantWorks. This includes amortization of deferred commission costs. It also includes trade show and event costs, sponsorship costs, point of purchase display expenses and related amortization |
Research and Development Expenses | Research and Development Expenses Research and development (“R&D”) costs incurred to establish the technological feasibility of software to be sold are expensed as incurred. These expenses include the costs of the Company’s proprietary R&D efforts, as well as costs incurred in connection with certain licensing arrangements. Research and development expenses consist primarily of personnel-related costs for employees working on development of solutions, including salaries, benefits, and stock-based compensation. Also included are non-personnel costs such as consulting and professional fees to third-party development resources. Substantially all of the Company's research and development expenses are related to developing new software solutions and improving its existing software solutions. |
Stock-Based Compensation | Stock-Based Compensation The Company accounts for stock-based compensation arrangements granted to employees in accordance with ASC 718, Compensation–Stock Compensation, by measuring the grant date fair value of the award and recognizing the resulting expense over the period during which the employee is required to perform service in exchange for the award. The Company accounts for stock-based compensation arrangements issued to non-employees using the fair value approach prescribed by ASC 505-50, Equity-Based Payments to Non-Employees. Stock-based compensation expense for both employee and nonemployee awards is recognized on a straight-line basis over the appropriate service period for awards that are only subject to service conditions and is recognized using the accelerated attribution method for awards that are subject to performance conditions. Stock-based compensation expense is only recognized for awards subject to performance conditions if it is probable that the performance condition will be achieved. All excess tax benefits and tax deficiencies are recognized as income tax benefit or expense in the income statement as discrete items in the reporting period in which they occur, and such tax benefits and tax deficiencies are not included in the estimate of an entity’s annual effective tax rate, applied on a prospective basis. The recognition of excess tax benefits is deferred until the benefit is realized through a reduction to taxes payable. When the Company applies the treasury stock method in calculating diluted earnings per share, excess tax benefits, if applicable, and deficiencies from the calculation of assumed proceeds are excluded since such amounts are recognized in the income statement. Excess tax benefits if applicable, are classified as operating activities in the same manner as other cash flows related to income taxes on the statement of cash flows. |
Change In Fair Value Of Bookings Commitment | Change in Fair Value of Bookings Commitment The Company has classified the Bookings Commitment assumed upon the disposal of the provider/patient engagement solutions business described in Note 10 as part of accrued and other current liabilities and other liabilities in the Consolidated Balance Sheets. This liability is subject to re-measurement at each balance sheet date, and the Company recognizes any changes in fair value within other income/expense, net. The fair value of the liability is estimated using a Monte Carlo Simulation model to calculate average payments due under the Bookings Commitment, based on management's estimate of its performance in securing bookings and resulting annual payments, discounted at the cost of debt based on a yield curve. The change in the fair value of this liability is primarily due to changes in the costs of debt based on a yield curve and the passage of time (see Note 10). |
Income Taxes | Income Taxes The Company records the federal and state tax provision of the consolidated group and foreign tax provision of its foreign subsidiaries. ASC 740, Income Taxes , provides the accounting treatment for uncertainty in income taxes recognized in an enterprise’s financial statements. ASC 740 prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. ASC 740 also provides guidance on derecognizing, classification, interest and penalties, accounting in interim periods, disclosure, and transition. As part of the process of preparing its Consolidated Financial Statements, the Company is required to estimate its provision for income taxes in each of the tax jurisdictions in which the Company conducts business. This process involves estimating the actual current tax expense in conjunction with the evaluation and measurement of temporary differences resulting from differing treatment of certain items for tax and accounting purposes. These temporary differences result in the establishment of deferred tax assets and liabilities, which are recorded on a net basis and included in the Company's Consolidated Balance Sheets. The Company then evaluates on a periodic basis the probability that the net deferred tax assets will be recovered and therefore realized from future taxable income and to the extent the Company believes that recovery is not more likely than not, a valuation allowance is established to address such risk resulting in an additional related provision for income taxes during the period. Significant management judgment is required in determining its provision for income taxes, its deferred tax assets and liabilities, tax contingencies, unrecognized tax benefits, and any required valuation allowance, including taking into consideration the probability of the tax contingencies being incurred. Management assesses this probability based upon information provided by its tax advisers, its legal advisers and similar tax cases. If at a later time its assessment of the probability of these tax contingencies changes, its accrual for such tax uncertainties may increase or decrease. The Company has a valuation allowance due to management’s overall assessment of risks and uncertainties related to its future ability to realize and, hence, utilize certain deferred tax assets, primarily consisting of net operating losses ("NOLs"), carry forward temporary differences and future tax deductions. The effective tax rate for annual and interim reporting periods could be impacted if uncertain tax positions that are not recognized are settled at an amount which differs from the Company's estimate. Finally, if the Company is impacted by a change in the valuation allowance resulting from a change in judgment regarding the realizability of deferred tax assets, such effect will be recognized in the interim period in which the change occurs. |
Net Loss Per Share | Net Loss Per ShareBasic net loss per common share attributable to NantHealth is computed by dividing the net loss attributable to NantHealth by the weighted average number of shares of common stock outstanding during the respective periods, without consideration of common stock equivalents. Diluted net loss per common share attributable to NantHealth is computed by dividing the net loss attributable to NantHealth by the weighted average number of shares of common stock outstanding during the respective periods, adjusted to give effect to potentially dilutive securities. However, potentially dilutive securities are excluded from the computation of diluted net loss per common share attributable to NantHealth to the extent that their effect is anti-dilutive. If there is a net loss from continuing operations attributable to NantHealth, diluted net loss per share attributable to NantHealth is computed in the same manner as basic net loss per share attributable to NantHealth is computed, even if the Company reports net income as a result of discontinued operations attributable to NantHealth. The Company applies treasury method in calculating weighted average dilutive number of shares for its stock plans. The convertible notes will be reflected in diluted loss per share using the if-converted method until the Company makes an irrevocable settlement election requiring the future settlement of the convertible notes to have the principal amount settled in cash. |
Foreign Currency Translation | Foreign Currency Translation The Company has operations and holds assets in various foreign countries. The local currency is the functional currency for the Company’s subsidiaries in the United Kingdom and Canada. Assets and liabilities are translated at end-of-period exchange rates while revenues and expenses are translated at the average exchange rates in effect during the period. Equity is translated at historical rates and the resulting cumulative translation adjustments are included as a component of accumulated other comprehensive income/loss until the translation adjustments are realized. |
Leases | Leases The Company determines if an arrangement is a lease at inception . Operating leases are included in operating lease right-of-use (“ROU”) assets, other current liabilities are included in property, plant, and equipment, net, other current liabilities, and other liabilities in the Consolidated Balance Sheets. The Company currently does not have any finance leases. Operating lease ROU assets and operating lease liabilities are recognized based on the present value of the future minimum lease payments over the lease term at commencement date. The Company's leases do not provide an implicit rate; therefore, the Company uses the incremental borrowing rate based on the information available at commencem ent date, or at January 1, 2019 for the Company's leases on transition to ASC 842, in determining the present value of future payments. The operating lease ROU asset excludes lease incentives and initial direct costs incurred. The lease terms may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. Lease expense for minimum lease payments is recognized on a straight-line basis over the lease term. The Company has lease agreements with lease and non-lease components. For data center leases and real estate leases, the Company accounts for the lease and non-lease components as a single lease component. The Company treats data center leases with lease terms of less than one year as short-term leases and recognizes the lease expense straight-line over the lease term. |
Business Combinations | Business Combinations Business combinations are accounted for using the acquisition method of accounting. Under the acquisition method, assets acquired and liabilities assumed are recorded at their respective fair values as of the acquisition date. Any excess of the purchase price over the estimated fair values of the net assets acquired is recorded as goodwill. Management routinely monitors the factors impacting the acquired assets and liabilities. Transaction related costs are expensed as incurred. The operating results of the acquired business are reflected in the Company’s Consolidated Financial Statements as of the acquisition date. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Fair value measurements are classified and disclosed in one of the following three categories: • Level 1—Quoted prices for identical assets or liabilities in active markets; • Level 2—Quoted prices for similar assets or liabilities in active markets or quoted prices for identical or similar assets or liabilities in markets that are not active or are directly or indirectly observable; and • Level 3—Unobservable inputs that reflect estimates and assumptions. The carrying amounts reported in the Consolidated Balance Sheets for cash and cash equivalents, accounts receivable, accounts payable, notes payable, deferred revenue, and other current monetary assets and liabilities approximate fair value because of the immediate or short-term maturity of these financial instruments. In accordance with this guidance, the Company measures its cash equivalents at fair value. The Company’s cash equivalents are classified within Level 1. |
Cash and Cash Equivalents | Cash and Cash Equivalents The Company considers all unrestricted, highly liquid investments with an initial maturity of three months or less to be cash equivalents. These amounts are stated at cost, which approximates fair value. At December 31, 2022 and 2021, cash equivalents were deposited in financial institutions and consisted of immediately available fund balances. Cash and cash equivalents are maintained at stable financial institutions, generally at amounts in excess of federally insured limits, which represents a concentration of credit risk. The Company has not experienced any losses on deposits of cash and cash equivalents to date. |
Accounts Receivable and Allowance for Doubtful Accounts | Accounts Receivable and Allowance for Doubtful Accounts Accounts receivable are recorded at the invoiced amount, net of allowances for doubtful accounts. The allowance for doubtful accounts is based on management’s assessment of the collectability of accounts. The Company regularly reviews the adequacy of the allowance for doubtful accounts by considering the age of each outstanding invoice and the collection history of each customer to determine whether a specific allowance is appropriate. Accounts receivable deemed uncollectible are charged against bad debt expense when identified. |
Insurance Recoveries | Insurance Recoveries The Company records probable insurance recoveries gross of related liabilities. The income and expense related to these amounts are recorded net in selling, general and administrative expenses. If the recoveries exceed the loss recognized in the financial statements, such recoveries are recorded in other expense, net, once any contingencies relating to the insurance claim have been resolved. |
Property, Plant and Equipment, net and Internal-Use Software | Property, Plant and Equipment, net Property, plant and equipment received in connection with business combinations are recorded at fair value. Property, plant and equipment acquired in the normal course of business are recorded at cost. Depreciation is computed on a straight-line basis over the estimated useful lives of the related assets (see Note 6). Maintenance and repairs are charged to expense as incurred while expenditures for refurbishments and improvements that significantly add to the productive capacity or extend the useful life of an asset are capitalized. Property, plant and equipment is tested for impairment, and depreciation estimates and methods are reviewed, whenever events or changes in circumstances indicate that its carrying amount may not be recoverable. Internal-Use Software The Company accounts for the costs of computer software obtained or developed for internal use in accordance with ASC 350, Intangibles—Goodwill and Other . Computer software development costs are expensed as incurred, except for internal-use software costs that qualify for capitalization, and include employee related expenses, including salaries, benefits and stock-based compensation expenses; costs of computer hardware and software; and costs incurred in developing features and functionality. These capitalized costs are included in property and equipment in the Consolidated Balance Sheets. The Company expenses costs incurred in the preliminary project and post implementation stages of software development and capitalizes qualifying costs incurred in the application development stage and costs associated with significant enhancements to existing internal-use software applications. Software costs are amortized using the straight-line method over an estimated useful life of three years commencing when the software project is ready for its intended use. Internal-use software is tested for impairment where assets are grouped at the lowest level for which there are identifiable cash flows that are largely independent of the cash flows of other groups of assets whenever events or changes in circumstances indicate that its carrying amount may not be recoverable. |
Goodwill and Intangible Assets | Goodwill and Intangible Assets Goodwill acquired in a business combination and determined to have an indefinite useful life is not amortized but is tested for impairment annually as of October 1 or between annual tests when an impairment indicator exists. In the event there is a change in reporting units or segments, the Company will test for impairment at the reporting unit. A component of an operating segment is a reporting unit if the component constitutes a business for which discrete financial information is available and segment management regularly reviews the operating results of that component. As part of the annual impairment test, the Company may conduct an assessment of qualitative factors to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount. In a qualitative assessment, the Company would consider the macroeconomic conditions, including any deterioration of general conditions, industry and market conditions, including any deterioration in the environment where the reporting unit operates, increased competition, changes in the products/services and regulator and political developments; cost of doing business; overall financial performance, including any declining cash flows and performance in relation to planned revenues and earnings in past periods; other relevant reporting unit specific facts, such as changes in management or key personnel or pending litigation, and events affecting the reporting unit, including changes in the carrying value of net assets. If an optional qualitative goodwill impairment assessment is not performed, the Company is required to determine the fair value of each reporting unit. If a reporting unit’s carrying value is in excess of its fair value, such excess is recorded as an impairment loss. Under the accounting guidance, there is no requirement to perform a qualitative assessment for reporting units with zero or negative carrying values. Accounting guidance requires that definite-lived intangible assets be amortized over their respective estimated useful lives and reviewed for impairment whenever events or changes in circumstances indicate that their carrying amounts may not be recoverable. Amortization of finite-lived intangible assets is provided over their estimated useful lives on a straight-line basis or the pattern in which economic benefits are consumed, if reliably determinable. If the estimates of the useful lives change, the Company amortizes the remaining book value over the remaining useful lives or, if an asset is deemed to be impaired, a write-down of the value of the asset to its fair value may be required at such time. The Company reviews its finite-lived intangible assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. |
Deferred Revenue | Deferred Revenue The Company records deferred revenue when it receives cash from customers prior to meeting the applicable revenue recognition criteria. The Company uses judgment in determining the period over which the deliverables are recognized as revenue. As of December 31, 2022 and 2021, current and non-current deferred revenue are comprised of deferrals for fees related to SaaS arrangements, technical support and maintenance, services and other revenue. Non-current deferred revenue as of December 31, 2022 is expected to be recognized in a period more than 12 months after that date. |
Recently Adopted Accounting Pronouncements | Recently Adopted Accounting Pronouncements In August 2020, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU') No. 2020-06, Debt - Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging - Contracts in Entity's Own Equity (Subtopic 815-40) . This update simplifies the accounting for convertible instruments by eliminating the cash conversion and beneficial conversion feature models which require separate accounting for embedded conversion features. This update also amends the guidance for the derivatives scope exception for contracts in an entity's own equity to reduce form-over-substance-based accounting conclusions and requires the application of the if-converted method for calculating diluted earnings per share. ASU No. 2020-06 is effective for fiscal periods beginning after December 15, 2023. The Company early adopted ASU 2020-06 on a modified retrospective basis on January 1, 2021. The cumulative effect of the adoption on accumulated deficit and additional paid-in capital was a decrease of $8,572 and $14,318, respectively, on January 1, 2021. Under the new guidance, the Company will record less noncash interest expense going forward as the cash conversion model that was previously applied is now eliminated. Upcoming Accounting Standard Pronouncements In June 2016, the FASB issued ASU No. 2016-13, Measurement of Credit Losses on Financial Instruments , which changes how companies measure credit losses on most financial instruments measured at amortized cost, such as loans, receivables and held-to-maturity debt securities. Rather than generally recognizing credit losses when it is probable that the loss has been incurred, the revised guidance requires companies to recognize an allowance for credit losses for the difference between the amortized cost basis of a financial instrument and the amount of amortized cost that the Company expects to collect over the instrument's contractual life. ASU No. 2016-13 is effective for fiscal periods beginning after December 15, 2022 and must be adopted as a cumulative effect adjustment to retained earnings. Early adoption is permitted. The Company is still evaluating the effects of this ASU. The Company does not anticipate that the adoption of this ASU will have a material impact on the Company's Consolidated Financial Statements. Other recent accounting pronouncements issued by the FASB (including its Emerging Issues Task Force), the American Institute of Certified Public Accountants, and the SEC did not have, nor are believed by management to have, a material impact on the Company's present or future Consolidated Financial Statements. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Accounting Policies [Abstract] | |
Schedule of Concentration of Risk | The following table summarizes the number of customers that individually comprise greater than 10% of revenues and/or 10% of accounts receivable, and their aggregate percentages of total revenues and total billed and unbilled accounts receivable: Period Significant Customers Percentage of Total Revenues Percentage of Total Accounts Receivable A B C A B C Year Ended December 31, 2022 3 27.7 % 13.0 % (1) 26.7 % (1) 16.2 % Year Ended December 31, 2021 3 22.8 % 12.9 % (1) 26.2 % 12.2 % 13.7 % (1) Amounts less than 10% are not disclosed. |
Accounts Receivable, net (Table
Accounts Receivable, net (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Receivables [Abstract] | |
Schedule of Activity in the Allowance for Doubtful Accounts | A summary of activity in the allowance for doubtful accounts for the years ended December 31, 2022 and 2021 is as follows: Balance at beginning of the period Additions to expense (Write offs) / Recoveries Balance at end of the period Year ended December 31, 2022 $ 2 20 (7) $ 15 Year ended December 31, 2021 $ 44 28 (70) $ 2 |
Prepaid Expenses and Other Cu_2
Prepaid Expenses and Other Current Assets and Accrued and Other Current Liabilities (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Other Current Assets And Other Current Liabilities [Abstract] | |
Schedule of Prepaid Expenses and Other Current Assets | Prepaid expenses and other current assets as of December 31, 2022 and 2021 consisted of the following: December 31, 2022 2021 Prepaid expenses $ 1,574 $ 2,256 Restricted cash 1,180 1,180 Securities litigation insurance receivable 1,250 — Other current assets 398 574 Prepaid expenses and other current assets $ 4,402 $ 4,010 |
Schedule of Accrued and Other Current Liabilities | Accrued and other current liabilities of December 31, 2022 and 2021 consisted of the following: December 31, 2022 2021 Payroll and related costs $ 7,949 $ 8,545 Accrued liabilities 4,279 2,640 Booking Commitment (see Note 10) 2,153 1,661 Securities litigation and cyber estimated liability 1,470 — Interest payable 703 703 Operating lease liabilities 2,105 1,912 Other accrued and other current liabilities 1,347 897 Accrued and other current liabilities $ 20,006 $ 16,358 |
Property, Plant and Equipment_2
Property, Plant and Equipment, net (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant and Equipment, net | Property, plant and equipment, net as of December 31, 2022 and 2021 consisted of the following: December 31, Useful life (in years) 2022 2021 Computer equipment and software 3 - 5 $ 7,592 $ 9,267 Furniture and equipment 5 - 7 1,054 1,060 Leasehold and building improvements (1) 3,776 3,821 Property, plant, and equipment, excluding internal-use software 12,422 14,148 Less: Accumulated depreciation and amortization (11,073) (10,857) Property, plant and equipment, excluding internal-use software, net 1,349 3,291 Internal-use software 3 49,479 43,314 Construction in progress - Internal-use software 1,464 1,082 Less: Accumulated depreciation and amortization - internal-use software (39,909) (35,321) Internal-use software, net 11,034 9,075 Property, plant and equipment, net $ 12,383 $ 12,366 (1) Useful lives for leasehold and building improvements represent the term of the lease or the estimated life of the related improvements, whichever is shorter. |
Intangible Assets, net (Tables)
Intangible Assets, net (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Finite-Lived Intangible Assets | The Company’s definite-lived intangible assets as of December 31, 2022 and 2021 consisted of the following: December 31, 2022 Customer Developed Technologies Trade Name Installed User Base Total Gross carrying amount $ 53,000 $ 34,500 $ 3,300 $ 1,400 $ 92,200 Accumulated amortization (24,794) (33,319) (3,238) (739) (62,090) Intangible assets, net $ 28,206 $ 1,181 $ 62 $ 661 $ 30,110 December 31, 2021 Customer Developed Technologies Trade Name Installed User Base Total Gross carrying amount $ 53,000 $ 34,500 $ 3,300 $ 1,400 $ 92,200 Accumulated amortization (21,161) (28,331) (3,163) (506) (53,161) Intangible assets, net $ 31,839 $ 6,169 $ 137 $ 894 $ 39,039 |
Schedule of Finite-Lived Intangible Assets, Future Amortization Expense | The estimated future amortization expense over the next five years and thereafter for the intangible assets that exist as of December 31, 2022 is as follows: Amounts 2023 $ 4,346 2024 4,283 2025 4,147 2026 3,467 2027 3,467 Thereafter 10,400 Total future intangible amortization expense $ 30,110 |
Convertible Notes (Tables)
Convertible Notes (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Debt Disclosure [Abstract] | |
Convertible Debt | The following table summarizes the parties involved in the issuance of the convertible notes and their respective balances in the Company's Consolidated Balance Sheets as of December 31, 2022 and 2021: Related party Others Total 2021 Notes: Balance as of December 31, 2022 Gross proceeds $ 62,500 $ 75,000 $ 137,500 Unamortized debt discounts and deferred financing offering costs (165) (317) (482) Net carrying amount $ 62,335 $ 74,683 $ 137,018 2021 Notes: Balance as of December 31, 2021 Gross proceeds $ 62,500 $ 75,000 $ 137,500 Unamortized debt discounts and deferred financing offering costs (232) (397) (629) Net carrying amount $ 62,268 $ 74,603 $ 136,871 |
Schedule of Interest Expense | The following table sets forth the Company's interest expense incurred for the years ended December 31, 2022 and 2021: Year Ended December 31, 2022 2021 Related party Others Total Related party Others Total Accrued coupon interest expense $ 2,813 $ 3,375 $ 6,188 $ 1,898 $ 2,278 $ 4,176 Amortization of debt discounts — — — 21 119 140 Amortization of deferred financing offering costs 67 80 147 57 426 483 Total convertible notes interest expense $ 2,880 $ 3,455 $ 6,335 $ 1,976 $ 2,823 $ 4,799 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Fair Value Disclosures [Abstract] | |
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis | Liabilities measured at fair value on a recurring basis as of December 31, 2022 and 2021 consisted of the following: December 31, 2022 Total fair value Quoted price in active markets for identical assets (Level 1) Significant other observable inputs (Level 2) Significant unobservable inputs (Level 3) Liabilities Bookings Commitment $ 36,863 $ — $ — $ 36,863 December 31, 2021 Total fair value Quoted price in active markets for identical assets (Level 1) Significant other observable inputs (Level 2) Significant unobservable inputs (Level 3) Liabilities Bookings Commitment $ 34,474 $ — $ — $ 34,474 |
Summary of Changes in the Fair Value | The following tables set forth a summary of changes in the fair value of Level 3 liabilities for the years ended December 31, 2022 and 2021: December 31, 2021 Transfers in (out) (1) Change in fair value recognized in earnings December 31, 2022 Liabilities Bookings Commitment 34,474 (500) 2,889 36,863 $ 34,474 $ (500) $ 2,889 $ 36,863 December 31, 2020 Transfers in (out) (1) Change in fair value recognized in earnings December 31, 2021 Liabilities Interest make-whole derivative - related party and others $ 4 $ — $ (4) $ — Bookings Commitment 32,651 (500) 2,323 34,474 $ 32,655 $ (500) $ 2,319 $ 34,474 (1) Transfers out of the Bookings Commitment fair value liability relates to the Annual Minimum Commitment, which was recorded in accrued and other current liabilities. Fair Value of Convertible Notes held at amortized cost As of December 31, 2022 and 2021, the fair value and carrying value of the Company's convertible notes were: Fair value Carrying value Face value 2021 Notes Balance as of December 31, 2022 Related party $ 48,125 $ 62,335 $ 62,500 Others 57,750 74,683 75,000 $ 105,875 $ 137,018 $ 137,500 Fair value Carrying value Face value 2021 Notes Balance as of December 31, 2021 Related party $ 51,466 $ 62,268 $ 62,500 Others 61,760 74,603 75,000 $ 113,226 $ 136,871 $ 137,500 |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Leases [Abstract] | |
Schedule of Lease Cost | Lease expense, charged to selling, general and administrative expense, for the year ended December 31, 2022 and 2021 consisted of: Year Ended December 31, 2022 2021 Operating lease cost $ 2,210 $ 2,308 Short-term lease cost 666 738 Variable cost 395 590 Sublease income (52) (74) Total lease cost $ 3,219 $ 3,562 Other information regarding the Company's leases: Year Ended December 31, 2022 2021 Operating cash flows for operating leases $ (2,653) $ (2,717) Weighted average remaining lease term - operating leases 3.5 years 4.3 years Weighted average discount rate - operating leases 11 % 11 % |
Schedule of Operating Lease Maturities | Maturities of the Company's operating leases at December 31, 2022 were as follows: Amounts 2023 $ 2,657 2024 2,503 2025 650 2026 589 2027 427 Thereafter 660 Total future minimum lease payments 7,486 Less: imputed interest (1,327) Total $ 6,159 As reported in the Consolidated Balance Sheet Accrued and other current liabilities $ 2,105 Operating lease liabilities 4,054 $ 6,159 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Income Tax Disclosure [Abstract] | |
Schedule of Income before Income Tax, Domestic and Foreign | The amount of loss before taxes from continuing operations is as follows: Year Ended 2022 2021 U.S. loss before taxes $ (68,683) $ (58,928) Foreign income before taxes 587 459 Loss before income taxes $ (68,096) $ (58,469) |
Schedule of Provision for Income Taxes | The components of the (provision for) benefit from income taxes are presented in the following table: Year Ended 2022 2021 Current: Federal — — State $ 177 $ 89 Foreign 84 68 Total current provision 261 157 Deferred: Federal (2) (2) State (515) (45) Foreign (61) (13) Total deferred benefit (578) (60) Less: (Benefit from) provision for income taxes from discontinued operations, net — — Provision for (benefit from) income taxes from continuing operations, net $ (317) $ 97 |
Schedule of Effective Income Tax Rate Reconciliation | The provision for income taxes differs from the amount of income tax determined by applying the applicable U.S. statutory federal income tax rate to pretax loss as a result of the following differences: Year Ended 2022 2021 United States federal tax at statutory rate 21.00 % 21.00 % Items affecting federal income tax rate: State tax, net of federal benefit 3.50 % 6.51 % Valuation allowance (27.13) % (37.34) % R&D credit 2.38 % 9.47 % NOL expiration (1.73) % (1.69) % State differential 1.52 % — % Other adjustments 0.93 % 1.89 % Effective income tax rate 0.47 % (0.16) % |
Schedule of Deferred Tax Assets and Liabilities | Significant components of the Company’s deferred tax assets and liabilities as of December 31, 2022 and 2021 are as follows: December 31, 2022 2021 Deferred income tax assets: Accounts payable and accrued expenses $ 11,387 $ 10,786 163(j) interest limitation 14,131 10,693 Deferred revenue 291 159 Allowance for doubtful accounts 88 83 Property, plant and equipment, net 490 396 Intangibles 592 125 Section 174 capitalized R&D 5,946 — Investments 61,096 60,185 Stock-based compensation 2,530 1,612 Operating lease liabilities 1,667 2,249 Research and development tax credits 7,900 5,533 Net operating loss carryforwards 121,998 119,486 Less: Valuation allowance (205,552) (187,075) Total deferred income tax assets 22,564 24,232 Deferred income tax liabilities: State taxes (8,932) (7,867) Intangible assets, net (12,901) (15,535) Convertible notes — — Deferred costs to obtain a customer contract (173) (226) Capitalized labor costs (237) (344) Other (368) (361) Operating lease right-of-use assets (1,159) (1,674) Total deferred income tax liabilities (23,770) (26,007) Deferred income taxes, net $ (1,206) $ (1,775) |
Schedule of Unrecognized Tax Benefits Roll Forward | A summary of changes to the amount of unrecognized tax benefits is as follows: 2022 Unrecognized tax benefits as of December 31, 2021 $ 1,123 Increases related to prior year tax positions taken during the current year 68 Increases related to current year tax positions taken during the current year 190 Unrecognized tax benefits as of December 31, 2022 $ 1,381 |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Share-Based Payment Arrangement [Abstract] | |
Schedule of Employee Service Share-based Compensation, Allocation of Recognized Period Costs | The following table reflects the components of stock-based compensation expense recognized in the Company's Consolidated Statements of Operations: Year Ended 2022 2021 Stock options: Cost of revenue $ 152 $ 188 Selling, general and administrative 3,891 3,012 Research and development 475 424 Total stock options stock-based compensation expense 4,518 3,624 Restricted stock units: Selling, general and administrative 107 128 Total restricted stock units stock-based compensation expense 107 128 Related party share based payments Selling, general and administrative 19 67 Research and development 21 68 Total related party stock-based compensation expense 40 135 Total stock-based compensation expense 4,665 3,887 Amount capitalized to internal-use software 103 118 Total stock-based compensation cost $ 4,768 $ 4,005 |
Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions | The following table summarizes the weighted-average assumptions used to value stock options at their grant date and the weighted-average grant-date fair value per share: Year Ended December 31, 2022 2021 Expected volatility 70.89 % 70.37 % Expected term to exercise from grant date 5.6 years 6.0 years Risk-free rate 3.20 % 0.94 % Expected dividend yield — % — % Weighted-average grant-date fair value per share of options $ 5.42 $ 5.97 |
Share-based Payment Arrangement, Option, Activity | The following table summarizes the activity related to stock options during the years ended December 31, 2022 and 2021: Number of Weighted-Average Weighted-Average Remaining Contractual Life Aggregate Intrinsic Value Stock options outstanding - December 31, 2020 665,317 $ 32.7 9.1 years $ 13,372 Granted 472,655 $ 29.98 Exercised (33,627) $ 8.25 $ 915 Forfeited (139,328) $ 42.06 $ 743 Stock options outstanding - December 31, 2021 965,017 $ 30.87 8.8 years $ 1,987 Granted 30,330 $ 8.57 Exercised (3,000) $ 8.25 $ 14 Forfeited (88,248) $ 33.62 $ 4 Stock options outstanding - December 31, 2022 904,099 $ 29.93 7.9 years $ — Stock options exercisable - December 31, 2022 517,842 $ 26.05 7.5 years $ — |
Schedule of Nonvested Restricted Stock Units Activity | The following table summarizes the activity related to the unvested restricted stock units during the years ended December 31, 2022 and 2021: Number of Units Weighted-Average Grant-Date Fair Value Unvested restricted stock units outstanding - December 31, 2020 16,886 $ 24.62 Vested (7,906) $ 22.84 Forfeited (1,000) $ 18.45 Unvested restricted stock units outstanding - December 31, 2021 7,980 $ 27.15 Vested (3,990) $ 27.15 Unvested restricted stock units outstanding - December 31, 2022 3,990 $ 27.15 Vested and unvested restricted stock units outstanding - December 31, 2022 7,980 $ 27.15 |
Net Income (Loss) Per Share (Ta
Net Income (Loss) Per Share (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Earnings Per Share [Abstract] | |
Schedule of Earnings Per Share, Basic and Diluted | The following table sets forth reconciliations of the numerators and denominators used to compute basic and diluted net loss per share of common stock attributable to NantHealth for the years ended December 31, 2022 and 2021: Year Ended December 31, 2022 2021 Net income (loss) per share numerator: Net income (loss) from continuing operations $ (67,779) $ (58,566) Net income (loss) attributable to noncontrolling interests — (284) Net income (loss) from continuing operations attributable to NantHealth (67,779) (58,282) Income (loss) from discontinued operations, net of tax, attributable to NantHealth — 23 Net income (loss) for basic and diluted net loss per share $ (67,779) $ (58,259) Weighted-average shares for basic net income (loss) per share 7,702,872 7,609,906 Effect of dilutive securities — — Weighted-average shares for dilutive net income (loss) per share 7,702,872 7,609,906 Basic and diluted net income (loss) per share attributable to NantHealth: Continuing operations - common stock $ (8.80) $ (7.66) Total net income (loss) per share - common stock $ (8.80) $ (7.66) |
Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share | The following number of potential common shares at the end of each period were excluded from the calculation of diluted net loss per share attributable to common stockholders because their effect would have been anti-dilutive for the periods presented: Year Ended 2022 2021 Unexercised stock options 904,099 965,017 Unvested restricted stock units 3,990 7,980 Convertible notes 2,382,190 2,382,190 |
Description of Business and B_2
Description of Business and Basis of Presentation (Details) $ / shares in Units, $ in Thousands | 12 Months Ended | |||
Dec. 15, 2022 | Dec. 31, 2022 USD ($) $ / shares | Dec. 31, 2021 USD ($) $ / shares | Nov. 12, 2021 $ / shares | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||||
Cash and cash equivalents | $ 1,759 | $ 29,084 | ||
Accumulated income (deficit) | (1,120,676) | (1,052,897) | ||
Net loss | (67,779) | (58,543) | ||
Total cash used in operating activities | $ (32,264) | $ (27,689) | ||
Common stock, par value (usd per share) | $ / shares | $ 0.0001 | $ 0.0001 | $ 0.0001 | |
Stock split, conversion ratio | 0.0667 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies - Narrative (Details) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2022 USD ($) segment | Dec. 31, 2021 USD ($) | Jan. 01, 2021 USD ($) | Dec. 31, 2020 USD ($) | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Number of reportable segments | segment | 1 | |||
Change in discount rate, bookings | 2% | |||
Change in fair value of bookings commitments | $ 3,423 | |||
Operating lease, liability, current, statement of financial position [Extensible list] | Accrued and other current liabilities | Accrued and other current liabilities | ||
Total stockholders' equity (deficit) | $ (225,393) | $ (161,992) | $ (111,400) | |
Accumulated Deficit | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Total stockholders' equity (deficit) | (1,120,676) | (1,052,897) | (1,003,210) | |
Additional Paid-In Capital | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Total stockholders' equity (deficit) | $ 895,897 | $ 891,105 | 891,583 | |
Cumulative Effect, Period of Adoption, Adjustment | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Total stockholders' equity (deficit) | (5,746) | |||
Cumulative Effect, Period of Adoption, Adjustment | Accumulated Deficit | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Total stockholders' equity (deficit) | 8,572 | |||
Cumulative Effect, Period of Adoption, Adjustment | Additional Paid-In Capital | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Total stockholders' equity (deficit) | $ (14,318) | |||
Cumulative Effect, Period of Adoption, Adjustment | Accounting Standards Update 2020-06 | Accumulated Deficit | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Total stockholders' equity (deficit) | $ 8,572 | |||
Cumulative Effect, Period of Adoption, Adjustment | Accounting Standards Update 2020-06 | Additional Paid-In Capital | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Total stockholders' equity (deficit) | $ (14,318) | |||
Software and Software Development Costs | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Estimated useful life | 3 years |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies - Concentration of Risk (Details) - customer | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Concentration Risk [Line Items] | ||
Significant Customers | 3 | 3 |
Customer Concentration Risk | Percentage of Total Revenues | Customer A | ||
Concentration Risk [Line Items] | ||
Concentration percentage | 27.70% | 22.80% |
Customer Concentration Risk | Percentage of Total Revenues | Customer B | ||
Concentration Risk [Line Items] | ||
Concentration percentage | 13% | 12.90% |
Customer Concentration Risk | Percentage of Total Accounts Receivable | Customer A | ||
Concentration Risk [Line Items] | ||
Concentration percentage | 26.70% | 26.20% |
Customer Concentration Risk | Percentage of Total Accounts Receivable | Customer B | ||
Concentration Risk [Line Items] | ||
Concentration percentage | 12.20% | |
Customer Concentration Risk | Percentage of Total Accounts Receivable | Customer C | ||
Concentration Risk [Line Items] | ||
Concentration percentage | 16.20% | 13.70% |
Revenue Recognition (Details)
Revenue Recognition (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Revenue from Contract with Customer [Abstract] | ||
Deferred revenue recognized | $ 2,770 | $ 1,408 |
Capitalized contract cost | 686 | 810 |
Amortization of capitalized contract cost | 549 | $ 860 |
Unfulfilled performance obligations | $ 2,377 | |
Expected timing of performance obligation fulfillment | expected to be fulfilled within eight years. |
Accounts Receivable, net (Detai
Accounts Receivable, net (Details) - Allowance for Doubtful Accounts - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
SEC Schedule, 12-09, Movement in Valuation Allowances and Reserves [Roll Forward] | ||
Balance at beginning of the period | $ 2 | $ 44 |
Additions to expense | 20 | 28 |
(Write offs) / Recoveries | (7) | (70) |
Balance at end of the period | $ 15 | $ 2 |
Prepaid Expenses and Other Cu_3
Prepaid Expenses and Other Current Assets and Accrued and Other Current Liabilities - Prepaid Expenses and Other Current Assets (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Prepaid Expense and Other Assets, Current [Abstract] | ||
Prepaid expenses | $ 1,574 | $ 2,256 |
Restricted cash | 1,180 | 1,180 |
Securities litigation insurance receivable | 1,250 | 0 |
Other current assets | 398 | 574 |
Prepaid expenses and other current assets | $ 4,402 | $ 4,010 |
Prepaid Expenses and Other Cu_4
Prepaid Expenses and Other Current Assets and Accrued and Other Current Liabilities - Accrued and Other Current Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Other Current Assets And Other Current Liabilities [Abstract] | ||
Payroll and related costs | $ 7,949 | $ 8,545 |
Accrued liabilities | 4,279 | 2,640 |
Bookings Commitment | 2,153 | 1,661 |
Securities litigation and cyber estimated liability | 1,470 | 0 |
Interest payable | 703 | 703 |
Operating lease liabilities | 2,105 | 1,912 |
Other accrued and other current liabilities | 1,347 | 897 |
Accrued and other current liabilities | $ 20,006 | $ 16,358 |
Property, Plant and Equipment_3
Property, Plant and Equipment, net - Schedule of Property, Plant and Equipment, net (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Property, Plant and Equipment, Net, by Type [Abstract] | ||
Property, plant and equipment, net | $ 12,383 | $ 12,366 |
Property, plant, and equipment, excluding internal-use software | ||
Property, Plant and Equipment, Net, by Type [Abstract] | ||
Property, plant and equipment, gross | 12,422 | 14,148 |
Less: Accumulated depreciation and amortization | (11,073) | (10,857) |
Property, plant and equipment, net | 1,349 | 3,291 |
Computer equipment and software | ||
Property, Plant and Equipment, Net, by Type [Abstract] | ||
Property, plant and equipment, gross | $ 7,592 | 9,267 |
Computer equipment and software | Minimum | ||
Property, Plant and Equipment, Net, by Type [Abstract] | ||
Useful life (in years) | 3 years | |
Computer equipment and software | Maximum | ||
Property, Plant and Equipment, Net, by Type [Abstract] | ||
Useful life (in years) | 5 years | |
Furniture and equipment | ||
Property, Plant and Equipment, Net, by Type [Abstract] | ||
Property, plant and equipment, gross | $ 1,054 | 1,060 |
Furniture and equipment | Minimum | ||
Property, Plant and Equipment, Net, by Type [Abstract] | ||
Useful life (in years) | 5 years | |
Furniture and equipment | Maximum | ||
Property, Plant and Equipment, Net, by Type [Abstract] | ||
Useful life (in years) | 7 years | |
Leasehold and Building Improvements | ||
Property, Plant and Equipment, Net, by Type [Abstract] | ||
Property, plant and equipment, gross | $ 3,776 | 3,821 |
Software Development and Construction In Progress Software Development | ||
Property, Plant and Equipment, Net, by Type [Abstract] | ||
Less: Accumulated depreciation and amortization | (39,909) | (35,321) |
Property, plant and equipment, net | 11,034 | 9,075 |
Internal-use software | ||
Property, Plant and Equipment, Net, by Type [Abstract] | ||
Property, plant and equipment, gross | 49,479 | 43,314 |
Construction in progress - Internal-use software | ||
Property, Plant and Equipment, Net, by Type [Abstract] | ||
Construction in progress - Internal-use software | $ 1,464 | $ 1,082 |
Property, Plant and Equipment_4
Property, Plant and Equipment, net - Narrative (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Property, Plant and Equipment [Line Items] | ||
Depreciation expense | $ 6,513 | $ 5,932 |
Amount capitalized to internal use software | 6,713 | 4,727 |
Internal-use software | ||
Property, Plant and Equipment [Line Items] | ||
Depreciation expense | $ 4,592 | $ 4,027 |
Intangible Assets, net - Schedu
Intangible Assets, net - Schedule of Definite-Lived Assets (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Finite-Lived Intangible Assets [Line Items] | ||
Gross carrying amount | $ 92,200 | $ 92,200 |
Accumulated amortization | (62,090) | (53,161) |
Intangible assets, net | 30,110 | 39,039 |
Customer Relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross carrying amount | 53,000 | 53,000 |
Accumulated amortization | (24,794) | (21,161) |
Intangible assets, net | 28,206 | 31,839 |
Developed Technologies | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross carrying amount | 34,500 | 34,500 |
Accumulated amortization | (33,319) | (28,331) |
Intangible assets, net | 1,181 | 6,169 |
Trade Name | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross carrying amount | 3,300 | 3,300 |
Accumulated amortization | (3,238) | (3,163) |
Intangible assets, net | 62 | 137 |
Installed User Base | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross carrying amount | 1,400 | 1,400 |
Accumulated amortization | (739) | (506) |
Intangible assets, net | $ 661 | $ 894 |
Intangible Assets, net - Narrat
Intangible Assets, net - Narrative (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Amortization expense | $ 8,930 | $ 8,930 |
Intangible Assets, net - Sche_2
Intangible Assets, net - Schedule of Future Amortization of Intangible Assets (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Finite-Lived Intangible Assets, Net, Amortization Expense, Fiscal Year Maturity [Abstract] | ||
2023 | $ 4,346 | |
2024 | 4,283 | |
2025 | 4,147 | |
2026 | 3,467 | |
2027 | 3,467 | |
Thereafter | 10,400 | |
Intangible assets, net | $ 30,110 | $ 39,039 |
Goodwill (Details)
Goodwill (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Goodwill | $ 98,333,000 | $ 98,333,000 |
Goodwill impairment | $ 0 | $ 0 |
Convertible Notes - Narrative (
Convertible Notes - Narrative (Details) $ / shares in Units, $ in Thousands | 1 Months Ended | 12 Months Ended | ||||||||||
Nov. 21, 2022 | Dec. 15, 2021 USD ($) | May 25, 2021 USD ($) | Apr. 27, 2021 USD ($) day $ / shares shares | Apr. 14, 2021 USD ($) $ / shares shares | Apr. 13, 2021 USD ($) $ / shares shares | Dec. 31, 2016 USD ($) | Dec. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) | Jan. 01, 2021 USD ($) | Dec. 31, 2018 USD ($) | Dec. 21, 2016 | |
Debt Instrument [Line Items] | ||||||||||||
Proceeds from issuance of convertible notes, net of offering costs | $ 0 | $ 75,000 | ||||||||||
Loss on Exchange and Prepayment of 2016 Notes | 0 | 742 | ||||||||||
Repayment of convertible notes | 0 | 97,000 | ||||||||||
Affiliated Entity | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Interest bearing on related promissory note | 5.50% | |||||||||||
Nant Capital | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Interest bearing on related promissory note | 8.50% | |||||||||||
Cambridge Purchase Agreement | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Number of shares related party promissory note converted | shares | 112,612 | |||||||||||
Highbridge Capital Management Agreement | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Number of shares related party promissory note converted | shares | 128,452 | |||||||||||
Convertible Debt | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Interest rate on debt (in percentage) | 4.50% | 5.50% | 5.50% | |||||||||
Face value of debt | $ 107,000 | 137,500 | 137,500 | |||||||||
Proceeds from issuance of convertible notes, net of offering costs | 102,714 | |||||||||||
Initial purchasers' discount and debt issuance costs | 4,286 | |||||||||||
Carrying value of convertible notes on date of issuance | $ 137,018 | $ 136,871 | ||||||||||
Effective interest rate | 6.78% | |||||||||||
Amount of convertible debt converted | $ 10,000 | |||||||||||
Convertible notes payable | 10,000 | |||||||||||
Loss on Exchange and Prepayment of 2016 Notes | $ 412 | |||||||||||
Repayment of convertible notes | $ 9,500 | |||||||||||
Decrease in debt discount and deferred financing offering costs | 412 | |||||||||||
Convertible Debt | Cumulative Effect, Period of Adoption, Adjustment | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Carrying value of convertible notes on date of issuance | $ 5,746 | |||||||||||
Convertible Debt | Initial Purchasers Agreement | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Face value of debt | 90,000 | |||||||||||
Proceeds from issuance of convertible notes, net of offering costs | 92,797 | |||||||||||
Initial purchasers' discount and debt issuance costs | 1,358 | 644 | ||||||||||
Loss on Exchange and Prepayment of 2016 Notes | 267 | |||||||||||
Repayment of convertible notes | $ 55,555 | 31,945 | ||||||||||
Convertible Debt | Cambridge Purchase Agreement | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Face value of debt | $ 10,000 | |||||||||||
Proceeds from issuance of convertible notes, net of offering costs | 9,917 | |||||||||||
Amount of convertible debt converted | $ 5,000 | 5,000 | ||||||||||
Convertible notes payable | 5,000 | |||||||||||
Accrued and unpaid interest | $ 91 | |||||||||||
Number of shares related party promissory note converted | shares | 112,612 | |||||||||||
Conversion price of convertible debt (usd per share) | $ / shares | $ 44.40 | |||||||||||
Decrease to unamortized debt discount and deferred financing offering costs | $ 18 | |||||||||||
Convertible Debt | Cambridge Purchase Agreement | Highbridge Capital Management | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Amount of convertible debt converted | 5,000 | |||||||||||
Convertible Debt | Pursuant to the Exercise of the Overallotment by the Initial Purchasers | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Face value of debt | $ 7,000 | |||||||||||
Convertible Debt | Highbridge Capital Management Agreement | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Convertible notes payable | 5,000 | |||||||||||
Accrued and unpaid interest | $ 92 | |||||||||||
Number of shares related party promissory note converted | shares | 128,452 | |||||||||||
Conversion price of convertible debt (usd per share) | $ / shares | $ 38.925 | |||||||||||
Decrease to unamortized debt discount and deferred financing offering costs | $ 44 | |||||||||||
Convertible Debt | Highbridge Capital Management Agreement | Highbridge Capital Management | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Convertible notes payable | $ 36,945 | |||||||||||
Convertible Debt | Four Point Five Zero Percent Convertible Senior Notes Due 2026 | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Interest rate on debt (in percentage) | 4.50% | 4.50% | ||||||||||
Face value of debt | $ 137,500 | |||||||||||
Effective interest rate | 4.61% | |||||||||||
Conversion price of convertible debt (usd per share) | $ / shares | $ 57.72 | |||||||||||
Net proceeds from debt offering | $ 136,772 | |||||||||||
Deferred financing offering costs | $ 610 | |||||||||||
Shares converted per dollar (in shares) | shares | 17.3250 | |||||||||||
Remaining term | 40 months | |||||||||||
Threshold percentage of stock price trigger (in percentage) | 130% | |||||||||||
Threshold of trading days | day | 20 | |||||||||||
Threshold consecutive trading days | day | 30 | |||||||||||
Redemption price as a percentage of principal | 100% | |||||||||||
Threshold percentage of principal (in percentage) | 100% | |||||||||||
Principal outstanding to restrict future indebtedness | $ 25,000 | |||||||||||
Maturity period | 181 days | |||||||||||
Convertible Debt | Four Point Five Zero Percent Convertible Senior Notes Due 2026 | Nant Capital | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Net proceeds from debt offering | $ 62,223 | |||||||||||
Convertible Debt | Four Point Five Zero Percent Convertible Senior Notes Due 2026 | Highbridge Capital Management | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Net proceeds from debt offering | 74,549 | |||||||||||
Deferred financing offering costs | $ 118 |
Convertible Notes - Summary of
Convertible Notes - Summary of Issuance (Details) - Convertible Debt - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Debt Instrument [Line Items] | ||
Gross proceeds | $ 137,500 | $ 137,500 |
Unamortized debt discounts and deferred financing offering costs | (482) | (629) |
Net carrying amount | 137,018 | 136,871 |
Related party | ||
Debt Instrument [Line Items] | ||
Gross proceeds | 62,500 | 62,500 |
Unamortized debt discounts and deferred financing offering costs | (165) | (232) |
Net carrying amount | 62,335 | 62,268 |
Others | ||
Debt Instrument [Line Items] | ||
Gross proceeds | 75,000 | 75,000 |
Unamortized debt discounts and deferred financing offering costs | (317) | (397) |
Net carrying amount | $ 74,683 | $ 74,603 |
Convertible Notes - Interest Ex
Convertible Notes - Interest Expense Incurred (Details) - Convertible Debt - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Debt Instrument [Line Items] | ||
Accrued coupon interest expense | $ 6,188 | $ 4,176 |
Amortization of debt discounts | 0 | 140 |
Amortization of deferred financing offering costs | 147 | 483 |
Interest expense on debt | 6,335 | 4,799 |
Related party | ||
Debt Instrument [Line Items] | ||
Accrued coupon interest expense | 2,813 | 1,898 |
Amortization of debt discounts | 0 | 21 |
Amortization of deferred financing offering costs | 67 | 57 |
Interest expense on debt | 2,880 | 1,976 |
Others | ||
Debt Instrument [Line Items] | ||
Accrued coupon interest expense | 3,375 | 2,278 |
Amortization of debt discounts | 0 | 119 |
Amortization of deferred financing offering costs | 80 | 426 |
Interest expense on debt | $ 3,455 | $ 2,823 |
Fair Value Measurements - Asset
Fair Value Measurements - Assets and Liabilities Measured at Fair Value on a Recurring Basis (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Liabilities | ||
Bookings Commitment | $ 2,153 | $ 1,661 |
Recurring Basis | ||
Liabilities | ||
Bookings Commitment | 36,863 | 34,474 |
Recurring Basis | Quoted Price in Active Markets for Identical Assets (Level 1) | ||
Liabilities | ||
Bookings Commitment | 0 | 0 |
Recurring Basis | Significant Other Observable Inputs (Level 2) | ||
Liabilities | ||
Bookings Commitment | 0 | 0 |
Recurring Basis | Significant Unobservable Inputs (Level 3) | ||
Liabilities | ||
Bookings Commitment | $ 36,863 | $ 34,474 |
Fair Value Measurements - Narra
Fair Value Measurements - Narrative (Details) - USD ($) $ in Thousands | 1 Months Ended | 12 Months Ended | ||
Dec. 30, 2017 | Dec. 31, 2016 | Dec. 31, 2022 | Dec. 31, 2021 | |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||||
Minimum booking commitments | $ 95,000 | |||
Bookings commitment period (in years) | 10 years | |||
Bookings commitment annual minimum | $ 500 | |||
Booking commitments current annual accrual | $ 1,700 | $ 1,200 | ||
Percentage of shortfall payable | 70% | |||
Commission percentage | 30% | |||
Bookings commitment, discounted liabilities, discount rate (in percentage) | 11% | |||
Convertible Debt | ||||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||||
Face value of debt | $ 107,000 | 137,500 | $ 137,500 | |
Period that must lapse prior to conversion for noteholder to receive interest make-whole payment | 1 year | |||
Threshold period used to compute interest payment | 3 years | |||
Convertible Debt | Related party | ||||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||||
Face value of debt | $ 10,000 | $ 62,500 | $ 62,500 | |
Minimum | ||||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||||
Bookings commitment, discounted liabilities, discount rate (in percentage) | 12% | |||
Maximum | ||||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||||
Bookings commitment, discounted liabilities, discount rate (in percentage) | 13% | |||
Derivative liability | Measurement Input, Discount Rate | ||||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||||
Discount rate on converted debt (in percentage) | 2% |
Fair Value Measurements - Chang
Fair Value Measurements - Changes in the Fair Value of Level 3 Liabilities (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||
Beginning balance | $ 34,474 | $ 32,655 |
Transfers in (out) | (500) | (500) |
Change in fair value | 2,889 | 2,319 |
Ending balance | 36,863 | 34,474 |
Bookings Commitment | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||
Beginning balance | 34,474 | 32,651 |
Transfers in (out) | (500) | (500) |
Change in fair value | 2,889 | 2,323 |
Ending balance | 36,863 | 34,474 |
Interest make-whole derivative - related party and others | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||
Beginning balance | $ 0 | 4 |
Transfers in (out) | 0 | |
Change in fair value | (4) | |
Ending balance | $ 0 |
Fair Value Measurements - Fair
Fair Value Measurements - Fair Value of Debt (Details) - Convertible Debt - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2016 |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Face value | $ 137,500 | $ 137,500 | $ 107,000 |
Fair value | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Fair value and carrying value | 105,875 | 113,226 | |
Carrying value | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Fair value and carrying value | 137,018 | 136,871 | |
Related party | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Face value | 62,500 | 62,500 | $ 10,000 |
Related party | Fair value | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Fair value and carrying value | 48,125 | 51,466 | |
Related party | Carrying value | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Fair value and carrying value | 62,335 | 62,268 | |
Others | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Face value | 75,000 | 75,000 | |
Others | Fair value | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Fair value and carrying value | 57,750 | 61,760 | |
Others | Carrying value | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Fair value and carrying value | $ 74,683 | $ 74,603 |
Leases - Narrative (Details)
Leases - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | ||
Sep. 30, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | Jun. 30, 2022 | |
Lessee, Lease, Description [Line Items] | ||||
Renewal term | 5 years | |||
Term for option to terminate leases | 1 year | |||
Sublease, percent of office space | 27% | |||
Impairment charge | $ 208 | $ 208 | $ 0 | |
Minimum | ||||
Lessee, Lease, Description [Line Items] | ||||
Original lease term | 1 year | |||
Operating lease, remaining lease term | 1 year | |||
Maximum | ||||
Lessee, Lease, Description [Line Items] | ||||
Original lease term | 11 years | |||
Operating lease, remaining lease term | 8 years |
Leases - Lease Expense (Details
Leases - Lease Expense (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Leases [Abstract] | ||
Operating lease cost | $ 2,210 | $ 2,308 |
Short-term lease cost | 666 | 738 |
Variable cost | 395 | 590 |
Sublease income | (52) | (74) |
Total lease cost | $ 3,219 | $ 3,562 |
Leases - Additional Operating L
Leases - Additional Operating Lease Information (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Leases [Abstract] | ||
Operating cash flows for operating leases | $ (2,653) | $ (2,717) |
Weighted average remaining lease term - operating leases | 3 years 6 months | 4 years 3 months 18 days |
Weighted average discount rate - operating leases | 11% | 11% |
Leases - Operating Lease Maturi
Leases - Operating Lease Maturity Analysis (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Leases [Abstract] | ||
2023 | $ 2,657 | |
2024 | 2,503 | |
2025 | 650 | |
2026 | 589 | |
2027 | 427 | |
Thereafter | 660 | |
Total future minimum lease payments | 7,486 | |
Less: imputed interest | (1,327) | |
Accrued and other current liabilities | 2,105 | $ 1,912 |
Operating lease liabilities | 4,054 | $ 6,248 |
Operating lease liabilities including current maturities | $ 6,159 |
Commitments and Contingencies -
Commitments and Contingencies - Related Party Promissory Note (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 | Jan. 04, 2016 |
Related Party Transaction [Line Items] | |||
Related party promissory note | $ 123,666 | $ 112,666 | |
Affiliated Entity | Promissory Notes with NantCapital | |||
Related Party Transaction [Line Items] | |||
Related party promissory note | $ 112,666 |
Commitments and Contingencies_2
Commitments and Contingencies - Indenture Obligations Under Convertible Notes (Details) - Convertible Debt $ in Thousands | Apr. 27, 2021 USD ($) day | Apr. 13, 2021 | Dec. 31, 2016 | Dec. 21, 2016 |
Debt Instrument [Line Items] | ||||
Interest rate on debt (in percentage) | 4.50% | 5.50% | 5.50% | |
Four Point Five Zero Percent Convertible Senior Notes Due 2026 | ||||
Debt Instrument [Line Items] | ||||
Interest rate on debt (in percentage) | 4.50% | 4.50% | ||
Number of days interest payments are in default | 30 | |||
Number of days after written notice of failure to comply | 60 | |||
Percentage of debt holders | 25% | |||
Dollar amount of maximum default | $ | $ 17,500 | |||
Number of days in which to rescind or annul failure to pay or default | 30 | |||
Redemption price as a percentage of principal | 100% |
Commitments and Contingencies_3
Commitments and Contingencies - Securities and Derivative Litigation (Details) $ in Thousands | 1 Months Ended | |
Sep. 26, 2022 USD ($) | Apr. 30, 2018 claim | |
Commitments and Contingencies Disclosure [Abstract] | ||
Number of claims filed | claim | 2 | |
Litigation settlement, amount awarded to other party | $ 400 | |
Litigation settlement, expense | $ 1,250 |
Commitments and Contingencies_4
Commitments and Contingencies - Insurance (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | ||
Legal and professional fees | $ 100,000 | |
Accrued expenses for potential claim | 220,000 | |
Loss contingency, receivable | $ 1,250,000 | $ 0 |
Income Taxes - Loss from Contin
Income Taxes - Loss from Continuing Operations before Income Taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Income Tax Disclosure [Abstract] | ||
U.S. loss before taxes | $ (68,683) | $ (58,928) |
Foreign income before taxes | 587 | 459 |
Income (loss) from continuing operations before income taxes | $ (68,096) | $ (58,469) |
Income Taxes - Components of In
Income Taxes - Components of Income Tax Provision (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Current: | ||
Federal | $ 0 | $ 0 |
State | 177 | 89 |
Foreign | 84 | 68 |
Total current provision | 261 | 157 |
Deferred: | ||
Federal | (2) | (2) |
State | (515) | (45) |
Foreign | (61) | (13) |
Total deferred benefit | (578) | (60) |
Less: (Benefit from) provision for income taxes from discontinued operations, net | 0 | 0 |
Provision for (benefit from) income taxes from continuing operations, net | $ (317) | $ 97 |
Income Taxes - Effective Income
Income Taxes - Effective Income Tax Reconciliation (Details) | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Income Tax Disclosure [Abstract] | ||
United States federal tax at statutory rate | 21% | 21% |
Items affecting federal income tax rate: | ||
State tax, net of federal benefit | 3.50% | 6.51% |
Valuation allowance | (27.13%) | (37.34%) |
R&D credit | 2.38% | 9.47% |
NOL expiration | (1.73%) | (1.69%) |
State differential | 1.52% | 0% |
Other adjustments | 0.93% | 1.89% |
Effective income tax rate | 0.47% | (0.16%) |
Income Taxes - Deferred Tax Ass
Income Taxes - Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Deferred income tax assets: | ||
Accounts payable and accrued expenses | $ 11,387 | $ 10,786 |
163(j) interest limitation | 14,131 | 10,693 |
Deferred revenue | 291 | 159 |
Allowance for doubtful accounts | 88 | 83 |
Property, plant and equipment, net | 490 | 396 |
Intangibles | 592 | 125 |
Section 174 capitalized R&D | 5,946 | 0 |
Investments | 61,096 | 60,185 |
Stock-based compensation | 2,530 | 1,612 |
Operating lease liabilities | 1,667 | 2,249 |
Research and development tax credits | 7,900 | 5,533 |
Net operating loss carryforwards | 121,998 | 119,486 |
Less: Valuation allowance | 205,552 | 187,075 |
Total deferred income tax assets | 22,564 | 24,232 |
Deferred income tax liabilities: | ||
State taxes | (8,932) | (7,867) |
Intangible assets, net | (12,901) | (15,535) |
Convertible notes | 0 | 0 |
Deferred costs to obtain a customer contract | (173) | (226) |
Capitalized labor costs | (237) | (344) |
Other | (368) | (361) |
Operating lease right-of-use assets | (1,159) | (1,674) |
Total deferred income tax liabilities | (23,770) | (26,007) |
Deferred income taxes, net | $ (1,206) | $ (1,775) |
Income Taxes - Narrative (Detai
Income Taxes - Narrative (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Operating Loss Carryforwards [Line Items] | ||
Number of consecutive years with cumulative pre-tax loss | 3 years | |
Valuation allowance | $ (205,552) | $ (187,075) |
Increase in valuation allowance | 18,477 | $ 23,356 |
Valuation allowance for deferred tax assets credited to contributed capital | 358 | |
Federal | ||
Operating Loss Carryforwards [Line Items] | ||
Operating loss carryforwards | 461,012 | |
Operating loss carryforwards, not subject to expiration | 112,276 | |
Federal | Research Tax Credit Carryforward | ||
Operating Loss Carryforwards [Line Items] | ||
Tax credit carryforward | 8,442 | |
State | ||
Operating Loss Carryforwards [Line Items] | ||
Operating loss carryforwards | 333,515 | |
Operating loss carryforwards, not subject to expiration | $ 23,049 |
Income Taxes - Unrecognized Tax
Income Taxes - Unrecognized Tax Benefits (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2022 USD ($) | |
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns [Roll Forward] | |
Unrecognized tax benefits, beginning balance | $ 1,123 |
Increases related to prior year tax positions taken during the current year | 68 |
Increases related to current year tax positions taken during the current year | 190 |
Unrecognized tax benefits, ending balance | $ 1,381 |
Stockholders_ Equity (Deficit)
Stockholders’ Equity (Deficit) (Details) $ / shares in Units, $ in Thousands | 12 Months Ended | ||||||
Dec. 15, 2022 | Dec. 15, 2021 USD ($) | Apr. 14, 2021 shares | Apr. 13, 2021 USD ($) shares | Dec. 31, 2022 vote $ / shares shares | Dec. 31, 2021 $ / shares shares | Nov. 12, 2021 USD ($) $ / shares | |
Debt Instrument [Line Items] | |||||||
Common stock authorized (in shares) | 750,000,000 | 750,000,000 | |||||
Common stock, par value (usd per share) | $ / shares | $ 0.0001 | $ 0.0001 | $ 0.0001 | ||||
Preferred stock authorized (in shares) | 20,000,000 | ||||||
Preferred stock, par value (usd per share) | $ / shares | $ 0.0001 | ||||||
Number of votes per unit held | vote | 1 | ||||||
Preferred stock, shares outstanding (in shares) | 0 | 0 | |||||
Stock split, conversion ratio | 0.0667 | ||||||
Open Market Sales Agreement | |||||||
Debt Instrument [Line Items] | |||||||
Aggregate offering price | $ | $ 30,000 | ||||||
Convertible Debt | |||||||
Debt Instrument [Line Items] | |||||||
Amount of convertible debt converted | $ | $ 10,000 | ||||||
Convertible notes payable | $ | $ 10,000 | ||||||
Highbridge Capital Management Agreement | |||||||
Debt Instrument [Line Items] | |||||||
Number of shares related party promissory note converted | 128,452 | ||||||
Highbridge Capital Management Agreement | Convertible Debt | |||||||
Debt Instrument [Line Items] | |||||||
Convertible notes payable | $ | $ 5,000 | ||||||
Number of shares related party promissory note converted | 128,452 | ||||||
Cambridge Purchase Agreement | |||||||
Debt Instrument [Line Items] | |||||||
Number of shares related party promissory note converted | 112,612 | ||||||
Cambridge Purchase Agreement | Convertible Debt | |||||||
Debt Instrument [Line Items] | |||||||
Amount of convertible debt converted | $ | $ 5,000 | $ 5,000 | |||||
Convertible notes payable | $ | $ 5,000 | ||||||
Number of shares related party promissory note converted | 112,612 |
Stock-Based Compensation - Comp
Stock-Based Compensation - Components of Expense (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||
Total stock-based compensation expense | $ 4,665 | $ 3,887 |
Amount capitalized to internal-use software | 103 | 118 |
Total stock-based compensation cost | 4,768 | 4,005 |
Related party | ||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||
Total stock-based compensation expense | 40 | |
Stock options: | ||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||
Total stock-based compensation expense | 4,518 | 3,624 |
Stock options: | Cost of revenue | ||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||
Total stock-based compensation expense | 152 | 188 |
Stock options: | Selling, general and administrative | ||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||
Total stock-based compensation expense | 3,891 | 3,012 |
Stock options: | Research and development | ||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||
Total stock-based compensation expense | 475 | 424 |
Restricted stock units: | ||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||
Total stock-based compensation expense | 107 | 128 |
Restricted stock units: | Selling, general and administrative | ||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||
Total stock-based compensation expense | 107 | 128 |
Common Stock | Related party | ||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||
Total stock-based compensation expense | 40 | 135 |
Common Stock | Selling, general and administrative | Related party | ||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||
Total stock-based compensation expense | 19 | 67 |
Common Stock | Research and development | Related party | ||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||
Total stock-based compensation expense | $ 21 | $ 68 |
Stock-Based Compensation - Narr
Stock-Based Compensation - Narrative (Details) $ in Thousands | 12 Months Ended | |||
Dec. 15, 2022 | Dec. 31, 2022 USD ($) shares | Dec. 31, 2021 USD ($) shares | Jun. 01, 2020 shares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Stock split, conversion ratio | 0.0667 | |||
Unrecognized stock-based compensation is expected to be recognized | $ 7,002 | |||
Period for recognition of compensation cost not yet recognized | 1 year 7 months 6 days | |||
Stock options: | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Number of years options expire from grant date | 10 years | |||
Stock options: | Minimum | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Award requisite service period | 1 year | |||
Stock options: | Maximum | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Award requisite service period | 4 years | |||
Unvested restricted stock units | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Stock-based compensation expense expected to be recognized | $ 20 | |||
Period for recognition of compensation cost not yet recognized | 2 months 12 days | |||
Fair value of shares vested | $ 108 | $ 385 | ||
Unvested restricted stock units | Minimum | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Award requisite service period | 1 year | |||
Unvested restricted stock units | Maximum | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Award requisite service period | 4 years | |||
The 2016 Equity Incentive Plan | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Aggregate units authorized for issuance (in shares) | shares | 654,937 | 1,853,333 | ||
United States | Unvested restricted stock units | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Shares of common stock issued for vested phantom units (in shares) | shares | 0 | 6,669 | ||
Shares withheld to satisfy tax withholding obligations (in shares) | shares | 0 | 1,237 | ||
Tax payments related to stock issued | $ 0 | $ 50 |
Stock-Based Compensation - Fair
Stock-Based Compensation - Fair Value Assumptions (Details) - $ / shares | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Weighted-average grant-date fair value per share of options (usd per share) | $ 5.42 | $ 5.97 |
Stock options: | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Expected volatility | 70.89% | 70.37% |
Expected term to exercise from grant date | 5 years 7 months 6 days | 6 years |
Risk-free rate | 3.20% | 0.94% |
Expected dividend yield | 0% | 0% |
Stock-Based Compensation - Sche
Stock-Based Compensation - Schedule of Stock Options (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Number of Shares | |||
Stock options outstanding, beginning balance (in shares) | 965,017 | 665,317 | |
Granted (in shares) | 30,330 | 472,655 | |
Exercised (in shares) | (3,000) | (33,627) | |
Forfeited (in shares) | (88,248) | (139,328) | |
Stock options outstanding, ending balance (in shares) | 904,099 | 965,017 | 665,317 |
Stock options exercisable (shares) | 517,842 | ||
Weighted-Average Exercise Price | |||
Stock options outstanding, beginning balance (in usd per share) | $ 30.87 | $ 32.7 | |
Granted (in usd per share) | 8.57 | 29.98 | |
Exercised (in usd per share) | 8.25 | 8.25 | |
Forfeited (in usd per share) | 33.62 | 42.06 | |
Stock options outstanding, ending balance (in usd per share) | 29.93 | $ 30.87 | $ 32.7 |
Stock options exercisable (in usd per share) | $ 26.05 | ||
Stock options outstanding, weighted average remaining contractual life (in years) | 7 years 10 months 24 days | 8 years 9 months 18 days | 9 years 1 month 6 days |
Stock options exercisable, weighted average remaining contractual life (in years) | 7 years 6 months | ||
Share-based compensation arrangement by, options, aggregate intrinsic value beginning balance | $ 1,987 | $ 13,372 | |
Stock options exercises in period, aggregated intrinsic value | 14 | 915 | |
Stock options forfeited in period, aggregated intrinsic value | 4 | 743 | |
Share-based compensation arrangement by, options, aggregate intrinsic value ending balance | 0 | $ 1,987 | $ 13,372 |
Stock options exercisable, aggregated intrinsic value | $ 0 |
Stock-Based Compensation - Rest
Stock-Based Compensation - Restricted Stock Units (Details) - Unvested restricted stock units - $ / shares | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Number of Units | ||
Unvested units outstanding, beginning balance (in shares) | 7,980 | 16,886 |
Vested (in shares) | (3,990) | (7,906) |
Forfeited (in shares) | (1,000) | |
Unvested units outstanding, ending balance (in shares) | 3,990 | 7,980 |
Vested and unvested restricted stock units outstanding (in shares) | 7,980 | |
Weighted-Average Grant-Date Fair Value | ||
Unvested phantom units outstanding, beginning balance (in usd per share) | $ 27.15 | $ 24.62 |
Vested (in usd per share) | 27.15 | 22.84 |
Forfeited (in usd per share) | 18.45 | |
Unvested phantom units outstanding, ending balance (in usd per share) | 27.15 | $ 27.15 |
Vested and unvested restricted stock units outstanding (in dollars per share) | $ 27.15 |
Net Income (Loss) Per Share - N
Net Income (Loss) Per Share - Narrative (Details) | Dec. 15, 2022 |
Earnings Per Share [Abstract] | |
Stock split, conversion ratio | 0.0667 |
Net Income (Loss) Per Share - R
Net Income (Loss) Per Share - Reconciliations of the Basic and Diluted Net Loss Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | ||
Net income (loss) per share numerator: | |||
Net income (loss) from continuing operations | $ (67,779) | $ (58,566) | |
Net income (loss) attributable to noncontrolling interests | 0 | (284) | |
Net income (loss) from continuing operations attributable to NantHealth | (67,779) | (58,282) | |
Income (loss) from discontinued operations, net of tax, attributable to NantHealth | 0 | 23 | |
Net income (loss) attributable to NantHealth | $ (67,779) | $ (58,259) | |
Net income (loss) for basic and diluted net loss per share: | |||
Weighted-average shares for basic net income (loss) per share (in shares) | 7,702,872 | 7,609,906 | |
Effect of dilutive securities (in shares) | 0 | 0 | |
Weighted-average shares for dilutive net income (loss) per share (in shares) | [1] | 7,702,872 | 7,609,906 |
Basic and diluted net income (loss) per share attributable to NantHealth: | |||
Continuing operations - common stock per basic share (usd per share) | $ (8.80) | $ (7.66) | |
Continuing operations - common stock per diluted share (usd per share) | (8.80) | (7.66) | |
Total net income (loss) per share - common stock, basic (usd per share) | (8.80) | (7.66) | |
Total net income (loss) per share - common stock, diluted (usd per share) | $ (8.80) | $ (7.66) | |
[1]Reflects the 1-for-15 reverse stock split that became effective December 16, 2022. Refer to Note 1. |
Net Income (Loss) Per Share - A
Net Income (Loss) Per Share - Antidilutive Securities (Details) - shares | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Unexercised stock options | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities excluded from computation of earnings per share (in shares) | 904,099 | 965,017 |
Unvested restricted stock units | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities excluded from computation of earnings per share (in shares) | 3,990 | 7,980 |
Convertible notes | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities excluded from computation of earnings per share (in shares) | 2,382,190 | 2,382,190 |
Related Party Transactions - Na
Related Party Transactions - Nantworks Shared Services Agreement (Details) - NantWorks - Shared Services Agreement - Affiliated Entity - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Related Party Transaction [Line Items] | ||
Net selling, general, and administrative service expenses incurred related to services provided by related parties | $ 1,328 | |
Income from related parties | $ 561 |
Related Party Transactions - _2
Related Party Transactions - Nant Capital Note Purchase Agreement (Details) - USD ($) $ in Thousands | Apr. 13, 2021 | Dec. 31, 2022 | Dec. 31, 2021 |
Related Party Transaction [Line Items] | |||
Interest payable | $ 703 | $ 703 | |
Four Point Five Zero Percent Convertible Senior Notes Due 2026 | Convertible Debt | Nant Capital | |||
Related Party Transaction [Line Items] | |||
Proceeds from issuance of debt | $ 62,500 | ||
Interest payable | $ 689 | $ 586 |
Related Party Transactions - Re
Related Party Transactions - Related Party Receivables and Payables (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Related Party Transaction [Line Items] | ||
Related party receivables | $ 1,413 | $ 1,518 |
Related party payables, net of receivables | 47,841 | 43,439 |
Receivable from Ziosoft KK Related to Sale of Qi Imaging | Affiliated Entity | ||
Related Party Transaction [Line Items] | ||
Related party receivables | $ 1,041 | $ 1,144 |
Related Party Transactions - Am
Related Party Transactions - Amended Reseller Agreement (Details) | 12 Months Ended | ||
Jun. 19, 2015 USD ($) term test renewal_option | Dec. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) | |
Related Party Transaction [Line Items] | |||
Number of renewal options exercised | renewal_option | 1 | ||
Reseller Agreement | |||
Related Party Transaction [Line Items] | |||
Term of agreement with related party | 5 years 6 months | ||
Reseller Agreement | Equity Method Investee | |||
Related Party Transaction [Line Items] | |||
Number of renewals | term | 3 | ||
Renewal term | 3 years | ||
Number of tests to qualify for first renewal option | test | 300,000 | ||
Number of tests to qualify for second renewal option | test | 570,000 | ||
Number of tests to qualify for third renewal option | test | 760,000 | ||
Renewal option if threshold unmet, nonexclusive, number of years | 3 years | ||
Annual minimum fees, tier one | $ | $ 2,000,000 | ||
Due to related parties | $ | $ 0 | $ 0 | |
Cost of revenue | $ | $ 0 | $ 0 |
Related Party Transactions - Ca
Related Party Transactions - Cambridge Purchase Agreement (Details) - USD ($) $ in Thousands | Dec. 15, 2021 | Apr. 13, 2021 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2018 | Dec. 31, 2016 | Dec. 15, 2016 |
Related Party Transaction [Line Items] | |||||||
Interest payable | $ 703 | $ 703 | |||||
Convertible Debt | |||||||
Related Party Transaction [Line Items] | |||||||
Face value | $ 137,500 | $ 137,500 | $ 107,000 | ||||
Amount of convertible debt converted | $ 10,000 | ||||||
Convertible notes payable | 10,000 | ||||||
Convertible Debt | Cambridge Purchase Agreement | |||||||
Related Party Transaction [Line Items] | |||||||
Face value | $ 10,000 | ||||||
Amount of convertible debt converted | $ 5,000 | 5,000 | |||||
Convertible notes payable | $ 5,000 | ||||||
Interest payable | $ 138 | ||||||
Convertible Debt | Cambridge Purchase Agreement | Affiliated Entity | |||||||
Related Party Transaction [Line Items] | |||||||
Face value | $ 10,000 |
Related Party Transactions - _3
Related Party Transactions - Related Party Promissory Notes (Details) - USD ($) $ / shares in Units, $ in Thousands | 1 Months Ended | ||||||||
Nov. 21, 2022 | Oct. 03, 2022 | Jun. 30, 2017 | Dec. 15, 2016 | Dec. 31, 2016 | Dec. 31, 2022 | Dec. 31, 2021 | May 09, 2016 | Jan. 04, 2016 | |
Related Party Transaction [Line Items] | |||||||||
Related party promissory note | $ 123,666 | $ 112,666 | |||||||
Interest payable | 703 | 703 | |||||||
Affiliated Entity | |||||||||
Related Party Transaction [Line Items] | |||||||||
Interest bearing on related promissory note | 5.50% | ||||||||
Airstrip | |||||||||
Related Party Transaction [Line Items] | |||||||||
Related party promissory note | $ 4,000 | ||||||||
Interest bearing on related promissory note | 8.50% | ||||||||
Nant Capital | |||||||||
Related Party Transaction [Line Items] | |||||||||
Related party promissory note | $ 7,000 | ||||||||
Interest bearing on related promissory note | 8.50% | ||||||||
Promissory Notes with NantCapital | Affiliated Entity | |||||||||
Related Party Transaction [Line Items] | |||||||||
Related party promissory note | $ 112,666 | ||||||||
Interest bearing on related promissory note | 5% | ||||||||
Per share price of shares to settle debt (usd per share) | $ 1.484 | ||||||||
Per share price of stock shares to repay debt (usd per share) | $ 279.1890 | ||||||||
Promissory Notes with NantWorks | Affiliated Entity | |||||||||
Related Party Transaction [Line Items] | |||||||||
Related party promissory note | 250 | ||||||||
Interest bearing on related promissory note | 5% | ||||||||
Interest payable | $ 82 | ||||||||
Promissory Note 5.50%, Due December 31, 2023 | Affiliated Entity | |||||||||
Related Party Transaction [Line Items] | |||||||||
Maximum borrowing capacity of notes receivable | $ 125 |
Related Party Transactions - _4
Related Party Transactions - Related Party Share-based Payments (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Related Party Transaction [Line Items] | ||
Compensation expense post-acquisition | $ 4,665 | $ 3,887 |
Related party | ||
Related Party Transaction [Line Items] | ||
Compensation expense post-acquisition | $ 40 |
Employee Retirement Plan (Detai
Employee Retirement Plan (Details) - Other Postretirement Benefit Plan - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | |
NantHealth 401k Plan | |||
Defined Contribution Plan Disclosure [Line Items] | |||
Company's matching contribution of employee's percentage contribution, percentage | 100% | ||
Percentage of participant's pay which Company contributes matching percentage | 3% | ||
Vesting period of matching contribution | 3 years | ||
Company's total matching contributions | $ 702 | $ 608 | |
Registered Retirement Savings Plan (RRSP) | |||
Defined Contribution Plan Disclosure [Line Items] | |||
Company's matching contribution of employee's percentage contribution, percentage | 100% | ||
Percentage of participant's pay which Company contributes matching percentage | 5% | ||
Company's total matching contributions | $ 101 |
Subsequent Event (Details)
Subsequent Event (Details) - Subsequent event - Credit Agreement - Line of Credit $ in Millions | Mar. 02, 2023 USD ($) |
Subsequent Event [Line Items] | |
Borrowing capacity | $ 22.5 |
Interest rate on debt (in percentage) | 13% |
Original issue discount, percentage | 1% |
Uncategorized Items - nh-202212
Label | Element | Value |
Accounting Standards Update [Extensible Enumeration] | us-gaap_AccountingStandardsUpdateExtensibleList | Accounting Standards Update 2020-06 [Member] |
Restricted Cash | us-gaap_RestrictedCash | $ 1,375,000 |