OptimizeRx Reports First Quarter 2024 Financial Results
OptimizeRx reported a substantial year-over-year growth for Q1 2024, with revenue increasing by 51% to $19.7 million and gross profit rising by 64% to $12.2 million, representing a 62% gross margin. Despite these gains, the company faced a GAAP net loss of $6.9 million or $0.38 per share, slightly higher than the $6.4 million loss in Q1 2023. Non-GAAP net loss also increased to $2.0 million or $0.11 per share. Adjusted EBITDA improved to a loss of $0.3 million from $2.2 million in Q1 2023. The company secured 9 additional DAAP deals and reported having $15.2 million in cash and equivalents. The firm reaffirmed its 2024 guidance, expecting at least $100 million in revenue and $11 million in adjusted EBITDA. Key performance indicators showed positive trends, with net revenue retention at 116% and revenue per full-time employee at $641,000.
- Revenue increased by 51% year-over-year to $19.7 million.
- Gross profit rose by 64% to $12.2 million.
- Gross margin improved to 62%.
- Adjusted EBITDA loss improved to $0.3 million from $2.2 million in Q1 2023.
- Secured 9 additional DAAP deals in Q1 2024.
- Cash and equivalents rose to $15.2 million from $13.9 million by end of Q1 2024.
- Net revenue retention was 116% for Q1 2024.
- Revenue per full-time employee increased to $641,000.
- GAAP net loss increased to $6.9 million from $6.4 million in Q1 2023.
- Non-GAAP net loss increased to $2.0 million from $1.6 million in Q1 2023.
- Loss per share increased to $0.38 from $0.37 year-over-year.
- Non-GAAP loss per share increased to $0.11 from $0.09.
Insights
OptimizeRx Corp. reported impressive 51% year-over-year revenue growth for Q1 2024, reaching
However, the company's GAAP net loss for Q1 stands at
With cash and equivalents totaling
The announcement of 9 new DAAP deals in Q1 shows significant market traction for OptimizeRx's AI-enabled platform. This is a pivotal factor driving the revenue increase and reflects the company's successful penetration in the pharma sector. The adoption of their platform indicates a competitive edge in delivering scalable and high-quality healthcare solutions.
Moreover, the improved selling environment within the pharma end-market, as highlighted by the company's leadership, underscores a favorable market sentiment. This shift, compared to the challenges faced in 2022 and early 2023, indicates a strategic alignment with market needs and effective sales strategies. The addition of experienced sales reps and early success in cross-selling activities post Medicx acquisition are promising signs for future revenue streams.
OptimizeRx's success with its AI-enabled DAAP platform points to the increasing importance of technology in healthcare communications. Their platform's scalability and quality, as emphasized by the CEO, likely provide a competitive advantage, positioning OptimizeRx as a leader in the digital healthcare space. Such platforms help life sciences companies more effectively engage healthcare professionals and patients, potentially leading to improved healthcare outcomes and efficiencies.
The consistent focus on technology innovation and its integration into the Company's core offerings is important for maintaining long-term competitiveness. This approach not only enhances operational capabilities but also aligns with the broader industry trend towards digital transformation in healthcare.
- Q1 revenue of
$19.7 million , increasing51% year-over-year - Q1 gross profit increased
64% year-over-year to$12.2 million with a gross margin of62% - Won 9 DAAP deals during Q1
WALTHAM, Mass., May 14, 2024 (GLOBE NEWSWIRE) -- OptimizeRx Corp. (the “Company”) (Nasdaq: OPRX), the leading provider of healthcare technology solutions helping life sciences companies reach and engage healthcare professionals (HCPs) and patients, reported results for the three months ended March 31, 2024. Quarterly comparisons are to the same year-ago period.
Financial Highlights
- Revenue in the first quarter of 2024 increased
51% to$19.7 million , as compared to$13.0 million in the same year ago period. - Gross profit in the first quarter of 2024 increased
64% year-over-year to$12.2 million , from$7.4 million during the first quarter of 2023. - GAAP net loss totaled
$(6.9) million or$(0.38) per basic and diluted share in the first quarter, as compared to$(6.4) million or$(0.37) during the first quarter of 2023. - Non-GAAP net loss in the first quarter totaled
$(2.0) million or$(0.11) per diluted share, as compared to$(1.6) million or$(0.09) per diluted share during the first quarter of 2023 (see definition of these non-GAAP measures and reconciliation to GAAP, below). - Adjusted EBITDA for the first quarter of 2024 came in at
$(0.3) million compared to$(2.2) million in the same year ago period (see definition of this non-GAAP measure and reconciliation to GAAP, below). - Cash, cash equivalents and short-term investments totaled
$15.2 million as of March 31, 2024 as compared to$13.9 million as of December 31, 2023.
Will Febbo, OptimizeRx CEO commented, “I am excited to announce first quarter results came in above expectations with revenue growing
“The tone of conversations with our pharma customers is completely different today than 12 months ago," noted Steve Silvestro, President. "We continue to have success with our AI-enabled platform at a rate higher than expected internally with 9 additional DAAP wins in Q1 alone. The Company is experiencing a meaningfully better selling environment within the pharma end-market which is in contrast to what was seen in 2022 and the first half of 2023. We have enhanced our commercial team with the recent addition of highly experienced sales reps and we are very encouraged by the early cross selling activities post Medicx acquisition."
| Key Performance Indicators (KPIs)* | Rolling Twelve Months Ended 3/31/2024 | Rolling Twelve Months Ended 3/31/2023 | |||||
| (in thousands, except percentages) | |||||||
| Average revenue per top 20 pharmaceutical manufacturer | $ | 2,537 | $ | 1,823 | |||
| Percent of top 20 pharmaceutical manufacturers that are customers | 100 | % | 100 | % | |||
| Top 20 pharmaceutical manufacturers as percent of total net revenues | 65 | % | 59 | % | |||
| Net revenue retention | 116 | % | 86 | % | |||
| Revenue per averages full-time employee (FTE) | $ | 641 | $ | 605 | |||
2024 Financial Outlook
For the full year 2024, the Company is reiterating its 2024 guidance and expects revenue to be at least
Conference Call
| Date: | Tuesday, May 14, 2024 |
| Time: | 4:30 p.m. Eastern Time (1:30 p.m. Pacific Time) |
| Toll Free: | 1-877-423-9813 |
| International: | 1-201-689-8573 |
| Conference ID: | 13746273 |
| Webcast: | https://viavid.webcasts.com/starthere.jsp?ei=1668162&tp_key=64b094d8c1 |
Definition and Use of Non-GAAP Financial Measures
This earnings release includes a presentation of non-GAAP net loss and non-GAAP net loss per diluted share or non-GAAP EPS, and Adjusted EBITDA, all of which are non-GAAP financial measures.
The Company defines non-GAAP net loss as GAAP net loss with an adjustment, as applicable, to add back depreciation, amortization, amortization of debt issuance costs, stock-based compensation, acquisition expenses, severance expenses, income or loss related to the fair value of contingent consideration, gain or loss from the disposal of a business, asset impairment charges, other income (loss), and deferred income taxes. Non-GAAP EPS is defined as non-GAAP net loss divided by the number of weighted average shares outstanding on a diluted basis. Adjusted EBITDA is defined as GAAP net loss with an adjustment, as applicable, to add back depreciation, amortization, interest, stock-based compensation, acquisition expenses, severance expenses, income or loss related to the fair value of contingent consideration, gain or loss from the disposal of a business, asset impairment charges, other income (loss), and deferred income taxes. The Company has provided non-GAAP financial measures to aid investors in better understanding its performance. Management believes that these non-GAAP financial measures provide additional insight into the operations and cash flow of the Company.
Because of varying available valuation methodologies, subjective assumptions and the variety of equity instruments that can impact a Company’s non-cash operating expenses, management believes that providing non-GAAP financial measures that exclude non-cash expenses allows for meaningful comparisons between the Company’s business operating results and those of other companies, as well as provides an important tool for financial and operational decision making and for evaluating the Company’s business operating results over different periods of time.
The Company’s non-GAAP financial measures may not provide information that is directly comparable to that provided by other companies in the Company’s industry, as other companies in the industry may calculate such non-GAAP financial results differently. The Company’s non-GAAP net loss, non-GAAP EPS and Adjusted EBITDA are not measurements of financial performance under GAAP and should not be considered as an alternative to operating income or as an indication of operating performance or any other measure of performance derived in accordance with GAAP. The Company does not consider these non-GAAP measures to be substitutes for or superior to the information provided by its GAAP financial results.
The table, “Reconciliation of Non-GAAP to GAAP Financial Measures,” included below, provides a reconciliation of Non-GAAP net loss, Non-GAAP EPS and Adjusted EBITDA for the three months ended March 31, 2024 and 2023. Although the Company provides guidance for Adjusted EBITDA, it is not able to provide guidance to the most directly comparable GAAP measures. Reconciliations for forward-looking figures would require unreasonable efforts at this time because of the uncertainty and variability of the nature and amount of certain components of various necessary GAAP components, including, for example, those related to compensation, acquisition expenses, amortization or others that may arise during the year, and the Company’s management believes such reconciliations would imply a degree of precision that would be confusing or misleading to investors. For the same reasons, the Company is unable to address the probable significance of the unavailable information.
Definition of Key Performance Indicators*
Top 20 pharmaceutical manufacturers: We have updated the definition of “top 20 pharmaceutical manufacturers” in our key performance indicators to be based upon Fierce Pharma’s most updated list of “The top 20 pharma companies by 2023 revenue”. We previously used “The top 20 pharma companies by 2022 revenue”. As a result of this change, prior periods have been restated for comparative purposes.
Net revenue retention: Net revenue retention is a comparison of revenue generated from all clients in the previous period to total revenue generated from the same clients in the following year (i.e., excludes new client relationships for the most recent year).
Revenue per average Full Time Employee: We define revenue per average full-time employee (FTE) as total revenue over the last 12 months (LTM) divided by the average number of employees over the LTM, which is calculated by taking our total number of FTEs at the end of the prior year period by our total FTE headcount at the end of the most recent.
About OptimizeRx
OptimizeRx provides best-in-class health technology that enables care-focused engagement between life sciences organizations, healthcare providers, and patients at critical junctures throughout the patient care journey. Connecting over 2 million U.S. healthcare providers and millions of their patients through an intelligent technology platform embedded within a proprietary digital point-of-care network, as well as mass digital communication channels, OptimizeRx helps life sciences organizations engage and support their customers.
For more information, follow the Company on Twitter, LinkedIn or visit www.optimizerx.com.
Important Cautions Regarding Forward-Looking Statements
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Words such as “anticipates”, “believes”, “estimates”, “expects”, “forecasts”, “intends”, “plans”, “projects”, “targets”, “designed”, “could”, “may”, “should”, “will” or other similar words and expressions are intended to identify these forward-looking statements. All statements that reflect the Company’s expectations, assumptions, projections, beliefs or opinions about the future, other than statements of historical fact, are forward-looking statements, including, without limitation, statements relating to the Company’s growth, business plans, future performance, expected revenues, expected Adjusted EBITDA and prospects. These forward-looking statements are based on the Company’s current expectations and assumptions regarding the Company’s business, the economy, and other future conditions. The Company disclaims any intention or obligation to publicly update or revise any forward-looking statements, whether because of new information, future events, or otherwise, except as required by applicable law. Forward-looking statements are inherently subject to risks and uncertainties, some of which cannot be predicted, or quantified. Future events and actual results could differ materially from those set forth in, contemplated by, or underlying the forward-looking statements. The risks and uncertainties to which forward-looking statements are subject include, but are not limited to, the effect of government regulation, seasonal trends, our ability to maintain our contracts with electronic prescription platforms, competition, and other risks summarized in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2023, its subsequent Quarterly Reports on Form 10-Q, and its other filings with the Securities and Exchange Commission.
OptimizeRx Contact
Andy D’Silva, SVP Corporate Finance
adsilva@optimizerx.com
Investor Relations Contact
Ashley Robinson
LifeSci Advisors, LLC
arr@lifesciadvisors.com
| OPTIMIZERX CORPORATION CONDENSED CONSOLIDATED BALANCE SHEETS (in thousands except share and per share data) (UNAUDITED) | |||||||
| March 31, 2024 | December 31, 2023 | ||||||
| ASSETS | |||||||
| Current assets | |||||||
| Cash and cash equivalents | $ | 15,177 | $ | 13,852 | |||
| Accounts receivable, net | 29,748 | 36,253 | |||||
| Taxes receivable | 1,036 | 1,036 | |||||
| Prepaid expenses and other | 2,390 | 3,190 | |||||
| Total current assets | 48,351 | 54,331 | |||||
| Property and equipment, net | 153 | 149 | |||||
| Other assets | |||||||
| Goodwill | 78,357 | 78,357 | |||||
| Other intangibles, net | 14,882 | 15,198 | |||||
| Tradename and customer relationships, net | 33,596 | 34,198 | |||||
| Operating lease right of use assets, net | 527 | 573 | |||||
| Security deposits and other assets | 501 | 568 | |||||
| Total other assets | 127,863 | 128,894 | |||||
| TOTAL ASSETS | $ | 176,367 | $ | 183,374 | |||
| LIABILITIES AND STOCKHOLDERS’ EQUITY | |||||||
| Current liabilities | |||||||
| Current portion of long-term debt | $ | 3,500 | $ | 2,000 | |||
| Accounts payable – trade | 1,665 | 2,227 | |||||
| Accrued expenses | 7,278 | 7,706 | |||||
| Revenue share payable | 2,814 | 5,506 | |||||
| Taxes payable | 371 | 49 | |||||
| Current portion of lease liabilities | 233 | 222 | |||||
| Deferred revenue | 904 | 172 | |||||
| Total current liabilities | 16,765 | 17,881 | |||||
| Non-current liabilities | |||||||
| Long-term debt, net | 32,413 | 34,231 | |||||
| Lease liabilities, net of current portion | 314 | 371 | |||||
| Deferred tax liabilities, net | 4,337 | 4,337 | |||||
| Total liabilities | 53,829 | 56,821 | |||||
| Stockholders’ equity | |||||||
| Preferred stock, | — | — | |||||
| Common stock, | 20 | 20 | |||||
| Treasury stock, | (2 | ) | (2 | ) | |||
| Additional paid-in-capital | 193,677 | 190,793 | |||||
| Accumulated deficit | (71,157 | ) | (64,258 | ) | |||
| Total stockholders’ equity | 122,538 | 126,553 | |||||
| TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY | $ | 176,367 | $ | 183,374 | |||
| OPTIMIZERX CORPORATION CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (in thousands except share and per share data) (UNAUDITED) | |||||||
| For the Three Months Ended March 31, | |||||||
| 2024 | 2023 | ||||||
| Net revenue | $ | 19,690 | $ | 13,003 | |||
| Cost of revenues, exclusive of depreciation and amortization presented separately below | 7,486 | 5,570 | |||||
| Gross profit | 12,204 | 7,433 | |||||
| Operating expenses | |||||||
| General and administrative expenses | 16,166 | 14,032 | |||||
| Depreciation and amortization | 1,067 | 464 | |||||
| Total operating expenses | 17,233 | 14,496 | |||||
| Loss from operations | (5,029 | ) | (7,063 | ) | |||
| Other income (expense) | |||||||
| Interest expense | (1,546 | ) | — | ||||
| Interest income | 20 | 665 | |||||
| Total other income (expense), net | (1,526 | ) | 665 | ||||
| Loss before provision for income taxes | (6,555 | ) | (6,398 | ) | |||
| Provision for income taxes | (344 | ) | — | ||||
| Net loss | $ | (6,899 | ) | $ | (6,398 | ) | |
| Weighted average number of shares outstanding – basic | 18,170,108 | 17,094,676 | |||||
| Weighted average number of shares outstanding – diluted | 18,170,108 | 17,094,676 | |||||
| Loss per share – basic | $ | (0.38 | ) | $ | (0.37 | ) | |
| Loss per share – diluted | $ | (0.38 | ) | $ | (0.37 | ) | |
| OPTIMIZERX CORPORATION CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (in thousands) (UNAUDITED) | |||||||
| For the Three Months Ended March 31, | |||||||
| 2024 | 2023 | ||||||
| OPERATING ACTIVITIES: | |||||||
| Net loss | $ | (6,899 | ) | $ | (6,398 | ) | |
| Adjustments to reconcile net loss to net cash provided by (used in) operating activities: | |||||||
| Depreciation and amortization | 1,067 | 464 | |||||
| Stock-based compensation | 3,024 | 4,381 | |||||
| Increase in bad debt reserve | 132 | 128 | |||||
| Amortization of debt issuance costs | 182 | — | |||||
| Changes in: | |||||||
| Accounts receivable | 6,373 | 3,862 | |||||
| Prepaid expenses and other assets | 800 | (1,734 | ) | ||||
| Accounts payable | (562 | ) | (261 | ) | |||
| Revenue share payable | (2,692 | ) | (623 | ) | |||
| Accrued expenses and other liabilities | (362 | ) | (476 | ) | |||
| Taxes payable | 323 | — | |||||
| Deferred revenue | 732 | 571 | |||||
| NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES | 2,118 | (86 | ) | ||||
| INVESTING ACTIVITIES: | |||||||
| Purchase of property and equipment | (32 | ) | (29 | ) | |||
| Purchases of held-to-maturity investments | — | (56,927 | ) | ||||
| Redemptions of held-to-maturity investments | — | 55,600 | |||||
| Capitalized software development costs | (121 | ) | (194 | ) | |||
| NET CASH USED IN INVESTING ACTIVITIES | (153 | ) | (1,550 | ) | |||
| FINANCING ACTIVITIES: | |||||||
| Cash paid for employee withholding taxes related to the vesting of restricted stock units | (140 | ) | (171 | ) | |||
| Proceeds from exercise of stock options | — | 40 | |||||
| Repayment of long-term debt | (500 | ) | — | ||||
| NET CASH USED IN FINANCING ACTIVITIES | (640 | ) | (131 | ) | |||
| NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS | 1,325 | (1,767 | ) | ||||
| CASH AND CASH EQUIVALENTS - BEGINNING OF PERIOD | 13,852 | 18,209 | |||||
| CASH AND CASH EQUIVALENTS - END OF PERIOD | $ | 15,177 | $ | 16,441 | |||
| SUPPLEMENTAL CASH FLOW INFORMATION: | |||||||
| Cash paid for interest | $ | 1,350 | $ | — | |||
| Cash paid for income taxes | $ | 21 | $ | — | |||
| OPTIMIZERX CORPORATION RECONCILIATION of GAAP to NON-GAAP FINANCIAL MEASURES (in thousands, except share and per share data) (UNAUDITED) | |||||||
| Three Months Ended March 31, | |||||||
| 2024 | 2023 | ||||||
| Net loss | $ | (6,899 | ) | $ | (6,398 | ) | |
| Depreciation and amortization | 1,067 | 464 | |||||
| Stock-based compensation | 3,024 | 4,381 | |||||
| Severance expenses | 419 | — | |||||
| Amortization of debt issuance costs | 182 | — | |||||
| Acquisition expenses | 243 | — | |||||
| Non-GAAP net loss | $ | (1,964 | ) | $ | (1,553 | ) | |
| Non-GAAP net loss per share | |||||||
| Diluted | $ | (0.11 | ) | $ | (0.09 | ) | |
| Weighted average shares outstanding: | |||||||
| Diluted | 18,170,108 | 17,094,676 | |||||
| Three Months Ended March 31, | |||||||
| 2024 | 2023 | ||||||
| Net loss | $ | (6,899 | ) | $ | (6,398 | ) | |
| Depreciation and amortization | 1,067 | 464 | |||||
| Provision for income taxes | 344 | — | |||||
| Stock-based compensation | 3,024 | 4,381 | |||||
| Severance expenses | 419 | — | |||||
| Acquisition expenses | 243 | — | |||||
| Interest (income) expense, net | 1,526 | (665 | ) | ||||
| Adjusted EBITDA | $ | (276 | ) | $ | (2,218 | ) | |
FAQ
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