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Financial report summary
?Risks
- If we fail to effectively manage our growth, we may be unable to execute our business plan, adequately address competitive challenges or maintain our corporate culture, and our business, financial condition, and results of operations could be harmed.
- We have a limited operating history, which makes it difficult to evaluate our current business and future prospects and to predict our future operating results, and therefore increases the risk of investment.
- If we fail to retain existing members or add new members, our revenue, operating results, financial condition, and business may be significantly harmed.
- If we do not continue to attract new customers, or if existing customers do not renew their subscriptions, renew on less favorable terms, or fail to purchase additional solutions, it could have a material adverse effect on our business, financial condition, and results of operations.
- Our revenue is relatively concentrated within a small number of key customers, and the loss of one or more of such key customers could slow the growth rate of our revenue or cause our revenue to decline.
- We expect to face increasing competition in the market for our solutions.
- If we are not able to maintain and enhance our reputation and brand recognition, our business, financial conditions, and results of operations will be harmed.
- Making business decisions that prioritize the interests of our members may adversely impact our financial results.
- If our members’ profiles are out-of-date, inaccurate, or lack the information that members and customers want to see, we may not be able to realize the full potential of our network, which could adversely impact the growth of our business.
- The telehealth market is immature and volatile, and if it does not develop, or if it develops more slowly than we expect, if it encounters negative publicity, or if we are not successful in demonstrating and promoting the benefits of our solutions, the growth of our business will be harmed.
- Our corporate culture has contributed to our success, and if we cannot maintain our corporate culture as we grow, we could lose the innovation, teamwork, passion, and focus on execution that we believe contribute to our success, and our business may be harmed.
- The loss of one or more of any of the pharmaceutical brands that purchase our solutions could cause our revenue to decline.
- We calculate certain operational metrics using internal systems and tools and do not independently verify such metrics. Certain metrics are subject to inherent challenges in measurement, and real or perceived inaccuracies in such metrics may harm our reputation and negatively affect our business.
- Our estimates of market opportunity and forecasts of market growth may prove to be inaccurate, and even if the markets in which we compete achieve the forecasted growth, our business may not grow at similar rates, or at all.
- Certain of our operating results and financial metrics may be difficult to predict as a result of seasonality.
- Our operating results have in the past and may in the future continue to fluctuate on a quarterly and annual basis and if we fail to meet the expectations of analysts or investors, our stock price and the value of your investment could decline substantially.
- If our estimates or judgments relating to our critical accounting policies prove to be incorrect, our results of operations could be adversely affected.
- We are subject to stringent and changing laws, regulations, self-regulatory schemes, contractual obligations, and standards related to privacy, data protection, and information security. The actual or perceived failure by us, our customers, partners, or vendors to comply with such obligations could harm our reputation, subject us to significant fines and liability, or otherwise adversely affect our business.
- If our security measures are compromised now or in the future, or the security, confidentiality, integrity, or availability of our information technology, software, services, communications, or data is compromised, limited, or fails, this could have a material adverse effect on our business, financial condition, and results of operations.
- We rely on evolving technologies, including network and mobile infrastructure, as well as our own capabilities, to maintain and scale our business and maintain competitiveness. Any significant interruptions or delays in service in our products, on our apps or websites or any undetected errors or design faults could adversely affect our business, financial condition, and results of operations.
- We may become subject to enforcement actions or litigation as a result of our or our members’ failure to comply with laws and regulations relating to communications, even though noncompliance was inadvertent or unintentional.
- We may incur liability as a result of information retrieved from or transmitted over the Internet or published using our platform and legislation regulating content on our platform may require us to change our solutions or business practices and may adversely affect our business and financial results.
- We may experience fluctuations in our tax obligations and effective tax rate, which could materially and adversely affect our results of operations.
- Our ability to utilize our net operating loss carryforwards and certain other tax attributes may be limited.
- We depend on our talent to grow and operate our business, and if we are unable to hire, integrate, develop, motivate, and retain our personnel, we may not be able to grow effectively.
- We may become subject to litigation, which could have a material adverse effect on our business, financial condition, and results of operations.
- Recent volatility in capital markets and lower market prices for many securities may affect our ability to access new capital through sales of shares of our Class A common stock or the issuance of indebtedness, which may harm our liquidity, limit
- our ability to grow our business, pursue acquisitions, or improve our operating infrastructure and restrict our ability to compete in our markets.
- We may seek to grow our business through acquisitions of, or investments in, new or complementary businesses, technologies, tools, or solutions, or through strategic alliances, and the failure to manage these acquisitions, investments or alliances, or to integrate them with our existing business, could have a material adverse effect on us.
- We may enter into collaborations, in-licensing arrangements, joint ventures, strategic alliances, or partnerships with third-parties that may not result in the development of commercially viable solutions or the generation of significant future revenue.
- We may be unable to successfully execute on our growth initiatives, business strategies, or operating plans.
- We employ third-party licensed software and software components for use in or with our solutions, and the inability to maintain these licenses or the presence of errors or security vulnerabilities in the software we license could limit the functionality of our solutions and result in increased costs or reduced service levels, which could adversely affect our business.
- We rely on software-as-a-service, or SaaS, technologies from third parties.
- Our growth depends in part on the success of our strategic relationships with third parties.
- Any restrictions on our use of, or ability to license, data, or our failure to license data and integrate third-party technologies, could have a material adverse effect on our business, financial condition, and results of operations.
- Changes in accounting rules, assumptions, and/or judgments could materially and adversely affect us.
- Changes in tax laws or regulations that are applied adversely to us or our customers may have a material adverse effect on our business, cash flow, and financial condition or result of operations.
- Our ability to limit our liabilities by contract or through insurance may be ineffective or insufficient to cover our future liabilities.
- Our business could be disrupted by a pandemic, epidemic, or outbreak of an infectious disease.
- Our business could be disrupted by catastrophic events such as power disruptions, data security breaches, and terrorism.
- Our reputation and/or business could be negatively impacted by ESG matters and/or other reporting of such matters.
- Our risk management policies and procedures may not be fully effective in mitigating our risk exposure in all market environments or against all types of risk.
- We may incur significant additional costs and expenses, including costs and expenses associated with obligations relating to being a public company, which will require significant resources and management attention and may divert focus from our business operations, and we may generate losses in the future.
- If we are unable to implement and maintain effective internal controls over financial reporting, investors may lose confidence in the accuracy and completeness of our financial reports.
- We may not be able to halt the operations of entities that copy our intellectual property or that aggregate our data as well as data from other companies, including social networks, or copycat online services that may misappropriate our data. These activities could harm our brand and our business.
- Third parties may initiate legal proceedings alleging that we are infringing or otherwise violating their intellectual property rights, the outcome of which would be uncertain and could have a material adverse effect on our business, financial condition, and results of operations.
- Failure to maintain, protect, or enforce our intellectual property rights could harm our business and results of operations.
- If our trademarks and trade names are not adequately protected, we may not be able to build name recognition in our markets of interest and our business may be adversely affected.
- If we are unable to protect the confidentiality of our trade secrets, our business and competitive position could be harmed.
- Our solutions utilize open source software, and any failure to comply with the terms of one or more of these open source licenses could adversely affect our business.
- If we fail to comply with our obligations under license or technology agreements with third parties, we may be required to pay damages and we could lose license rights that are critical to our business.
- If we cannot license rights to use technologies on reasonable terms, we may not be able to commercialize new solutions or services in the future.
- We rely on third-party platforms, such as the Apple App Store and Google Play App Store, to distribute our platform and offerings.
- The healthcare regulatory and political framework is uncertain and evolving.
- Consolidation in the healthcare industry could have a material adverse effect on our business, financial condition, and results of operations.
- If we or our customers fail to comply with federal and state healthcare laws, including those governing fee splitting, our business, and financial relationships, we or our customers may be subject to significant administrative, civil, and criminal penalties.
- Our solutions address heavily regulated functions within the life sciences industry, and failure to comply with applicable laws and regulations could lessen the demand for our solutions or subject us to significant claims and losses.
- Evolving government regulations may increase our costs or adversely affect our results of operations.
- Our stock price may be volatile or may decline regardless of our operating performance, resulting in substantial losses for investors of our Class A common stock.
- The dual class structure of our common stock has the effect of concentrating voting control with our executive officers (including our Chief Executive Officer) and directors and their affiliates; this will limit or preclude your ability to influence corporate matters.
- Future sales and issuances of our Class A common stock or rights to purchase Class A common stock, including pursuant to our equity incentive plans, could result in additional dilution of the percentage ownership of our stockholders and could cause the stock price of our Class A common stock to decline.
- If a substantial number of shares become available for sale and are sold in a short period of time, the market price of our Class A common stock could decline.
- If securities or industry analysts do not publish or cease publishing research or reports about our business, or they publish negative reports about our business, our share price and trading volume could decline.
- Delaware law and provisions in our amended and restated certificate of incorporation and amended and restated bylaws could make a merger, tender offer, or proxy contest more difficult, limit attempts by our stockholders to replace or remove our current management and limit the market price of our Class A common stock.
- Our amended and restated bylaws designate specific state or federal courts located as the exclusive forum for certain litigation that may be initiated by our stockholders, which could limit stockholders’ ability to obtain a favorable judicial forum for disputes with us.
- We do not intend to pay dividends for the foreseeable future.
- We could be subject to securities class action litigation.
Management Discussion
- Comparison of the three and nine months ended December 31, 2023 and 2022.
- Revenue for the three months ended December 31, 2023 increased $20.0 million as compared to the same period in 2022. The increase was primarily driven by a $22.0 million increase in subscription revenue. Of the increase in subscription revenue, $6.0 million was driven by the addition of new subscription customers1 and $16.0 million was due to the expansion of existing customers. The expansion of existing customers was primarily driven by average revenue per existing Marketing Solutions customers increasing by 26% as a result of adding new and growing existing brands and service lines. Approximately 96% of our revenue for the three months ended December 31, 2023 was derived from subscription customers. The remaining change in revenue was driven by medical recruiting services.
- Revenue for the nine months ended December 31, 2023 increased $49.3 million as compared to the same period in 2022. The increase was primarily driven by a $50.8 million increase in subscription revenue. Of the increase in subscription revenue, $12.5 million was driven by the addition of new subscription customers1 and $38.3 million was due to the expansion of existing customers. The expansion of existing customers was primarily driven by average revenue per existing Marketing Solutions customers increasing by 21% as a result of adding new and growing existing brands and service lines. Approximately 94% of our revenue for the nine months ended December 31, 2023 was derived from subscription customers. The remaining change in revenue was driven by medical recruiting services.