XML 34 R24.htm IDEA: XBRL DOCUMENT v3.24.2.u1
SEGMENT REPORTING
 6 Months Ended
Jun. 30, 2024
Segment Reporting [Abstract]  
SEGMENT REPORTING SEGMENT REPORTING
Our chief operating decision makers ("CODM") previously identified the following three operating and reportable segments: RCM, EHR, and Patient Engagement. In May 2024, the Company made a number of changes to its organizational structure and management system to better align the Company's operating model with its strategic initiatives. As a result, the Company changed from three operating and reportable segments of (i) RCM, (ii) EHR and (iii) Patient Engagement to two operating and reportable segments of (i) EHR and (ii) RCM. These two segments are distinct business units with unique market dynamics and opportunities. They represent the components of the Company for which separate financial information is available and is utilized on a regular basis by the CODM in assessing segment performance and in allocating the Company's resources. The Patient Engagement segment results were transitioned into the EHR segment for all periods presented.
Management evaluates the performance of the segments based on revenues and adjusted EBITDA. Management believes adjusted EBITDA is a useful measure to assess the performance and liquidity of the Company as it provides meaningful operating results by excluding the effects of expenses that are not reflective of its operating business performance. Our CODM group is comprised of the Chief Executive Officer, Chief Operating Officer, and Chief Financial Officer. Accounting policies for each of the reportable segments are the same as those used on a consolidated basis.
Adjusted EBITDA consists of GAAP net income (loss) as reported and adjusts for (i) depreciation expense; (ii) amortization of software development costs; (iii) amortization of acquisition-related intangibles; (iv) stock-based compensation; (v) severance; (vi) other non-recurring charges; (vii) interest expense and other, net; and (viii) the provision (benefit) for income taxes. There are no intersegment revenues to be eliminated in computing segment revenue.
The CODM do not evaluate operating segments nor make decisions regarding operating segments based on assets. Consequently, we do not disclose total assets by reportable segment.
The following table presents a summary of the revenues and adjusted EBITDA of our two operating segments for the three and six months ended June 30, 2024 and 2023:
Three Months Ended June 30,Six Months Ended June 30,
(In thousands)2024202320242023
Revenues by segment:
RCM$54,108 $47,760 $107,146 $96,391 
EHR
Recurring revenue
Acute EHR26,666 30,013 54,160 59,353 
Post-acute EHR— 3,729 582 7,636 
Total recurring EHR revenue26,666 33,742 54,742 66,989 
Non-recurring revenue
Acute EHR3,956 2,775 6,008 6,750 
Post-acute EHR— 345 81 725 
Total non-recurring EHR revenue3,956 3,120 6,089 7,475 
Total EHR revenue$30,622 $36,862 $60,831 $74,464 
Total revenues$84,730 $84,622 $167,977 $170,855 
Adjusted EBITDA by segment:
RCM$7,804 $5,682 $14,202 13,580 
EHR4,770 5,545 7,826 12,289 
Total adjusted EBITDA$12,574 $11,227 $22,028 $25,869 
The following table reconciles net income to adjusted EBITDA:
Three Months Ended June 30,Six Months Ended June 30,
(In thousands)2024202320242023
Net income (loss), as reported$(5,049)$(2,837)(7,565)247 
Deferred revenue and other purchase accounting adjustments— — — — 
Depreciation expense400 597 800 1,095 
Amortization of software development costs5,980 1,826 8,722 3,312 
Amortization of acquisition-related intangibles3,126 4,014 6,253 8,029 
Stock-based compensation1,501 (123)2,300 1,124 
Severance and other non-recurring charges4,586 6,819 8,430 7,920 
Interest expense4,151 2,586 8,051 4,988 
Gain on sale of AHT— — (1,250)— 
Provision (benefit) for income taxes(2,121)(1,655)(3,713)(846)
Total adjusted EBITDA$12,574 $11,227 $22,028 $25,869 
Certain of the items excluded or adjusted to arrive at adjusted EBITDA are described below:
•Amortization of acquisition-related intangibles - Acquisition-related amortization expense is a non-cash expense arising primarily from the acquisition of intangibles in connection with acquisitions or investments. We exclude acquisition-related amortization expense from adjusted EBITDA because we believe (i) the amount of such expenses in any specific period may not directly correlate to the underlying performance of our business operations and (ii) such expenses can vary significantly between periods as a result of new acquisitions and full amortization of previously acquired intangible assets.
•Stock-based compensation - Stock-based compensation expense is a non-cash expense arising from the grant of stock-based awards. We exclude stock-based compensation expense from adjusted EBITDA because we believe (i) the amount of such expenses in any specific period may not directly correlate to the underlying performance of our business operations and (ii) such expenses can vary significantly between periods as a result of the timing and valuation of grants of new stock-based awards, including grants in connection with acquisitions.
•Severance and other non-recurring charges - We exclude severance expenses (primarily related to costs associated with our recent business transformation initiative) and other non-recurring charges (such as interest income, service charges, and other (income)/loss, and foreign currency (gain)/loss) from adjusted EBITDA because we believe (i) the amount of such expenses in any specific period may not directly correlate to the underlying performance of our business operations and (ii) such expenses can vary significantly between periods.