false Q2 --12-31 0001582982 0001582982 2025-01-01 2025-06-30 0001582982 CCLD:CommonStockParValue0.001PerShareMember 2025-01-01 2025-06-30 0001582982 CCLD:Sec8.75SeriesBCumulativeRedeemablePerpetualPreferredStockParValue0.001PerShareMember 2025-01-01 2025-06-30 0001582982 2025-07-31 0001582982 2025-06-30 0001582982 2024-12-31 0001582982 us-gaap:SeriesAPreferredStockMember 2025-06-30 0001582982 us-gaap:SeriesAPreferredStockMember 2024-12-31 0001582982 us-gaap:SeriesBPreferredStockMember 2025-06-30 0001582982 us-gaap:SeriesBPreferredStockMember 2024-12-31 0001582982 2025-04-01 2025-06-30 0001582982 2024-04-01 2024-06-30 0001582982 2024-01-01 2024-06-30 0001582982 us-gaap:PreferredStockMember us-gaap:SeriesAPreferredStockMember 2024-12-31 0001582982 us-gaap:PreferredStockMember us-gaap:SeriesBPreferredStockMember 2024-12-31 0001582982 us-gaap:CommonStockMember 2024-12-31 0001582982 us-gaap:AdditionalPaidInCapitalMember 2024-12-31 0001582982 us-gaap:RetainedEarningsMember 2024-12-31 0001582982 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2024-12-31 0001582982 us-gaap:TreasuryStockCommonMember 2024-12-31 0001582982 us-gaap:PreferredStockMember us-gaap:SeriesAPreferredStockMember 2025-03-31 0001582982 us-gaap:PreferredStockMember us-gaap:SeriesBPreferredStockMember 2025-03-31 0001582982 us-gaap:CommonStockMember 2025-03-31 0001582982 us-gaap:AdditionalPaidInCapitalMember 2025-03-31 0001582982 us-gaap:RetainedEarningsMember 2025-03-31 0001582982 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2025-03-31 0001582982 us-gaap:TreasuryStockCommonMember 2025-03-31 0001582982 2025-03-31 0001582982 us-gaap:PreferredStockMember us-gaap:SeriesAPreferredStockMember 2023-12-31 0001582982 us-gaap:PreferredStockMember us-gaap:SeriesBPreferredStockMember 2023-12-31 0001582982 us-gaap:CommonStockMember 2023-12-31 0001582982 us-gaap:AdditionalPaidInCapitalMember 2023-12-31 0001582982 us-gaap:RetainedEarningsMember 2023-12-31 0001582982 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2023-12-31 0001582982 us-gaap:TreasuryStockCommonMember 2023-12-31 0001582982 2023-12-31 0001582982 us-gaap:PreferredStockMember us-gaap:SeriesAPreferredStockMember 2024-03-31 0001582982 us-gaap:PreferredStockMember us-gaap:SeriesBPreferredStockMember 2024-03-31 0001582982 us-gaap:CommonStockMember 2024-03-31 0001582982 us-gaap:AdditionalPaidInCapitalMember 2024-03-31 0001582982 us-gaap:RetainedEarningsMember 2024-03-31 0001582982 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2024-03-31 0001582982 us-gaap:TreasuryStockCommonMember 2024-03-31 0001582982 2024-03-31 0001582982 us-gaap:PreferredStockMember us-gaap:SeriesAPreferredStockMember 2025-01-01 2025-03-31 0001582982 us-gaap:PreferredStockMember us-gaap:SeriesBPreferredStockMember 2025-01-01 2025-03-31 0001582982 us-gaap:CommonStockMember 2025-01-01 2025-03-31 0001582982 us-gaap:AdditionalPaidInCapitalMember 2025-01-01 2025-03-31 0001582982 us-gaap:RetainedEarningsMember 2025-01-01 2025-03-31 0001582982 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2025-01-01 2025-03-31 0001582982 us-gaap:TreasuryStockCommonMember 2025-01-01 2025-03-31 0001582982 2025-01-01 2025-03-31 0001582982 us-gaap:PreferredStockMember us-gaap:SeriesAPreferredStockMember 2025-04-01 2025-06-30 0001582982 us-gaap:PreferredStockMember us-gaap:SeriesBPreferredStockMember 2025-04-01 2025-06-30 0001582982 us-gaap:CommonStockMember 2025-04-01 2025-06-30 0001582982 us-gaap:AdditionalPaidInCapitalMember 2025-04-01 2025-06-30 0001582982 us-gaap:RetainedEarningsMember 2025-04-01 2025-06-30 0001582982 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2025-04-01 2025-06-30 0001582982 us-gaap:TreasuryStockCommonMember 2025-04-01 2025-06-30 0001582982 us-gaap:PreferredStockMember us-gaap:SeriesAPreferredStockMember 2024-01-01 2024-03-31 0001582982 us-gaap:PreferredStockMember us-gaap:SeriesBPreferredStockMember 2024-01-01 2024-03-31 0001582982 us-gaap:CommonStockMember 2024-01-01 2024-03-31 0001582982 us-gaap:AdditionalPaidInCapitalMember 2024-01-01 2024-03-31 0001582982 us-gaap:RetainedEarningsMember 2024-01-01 2024-03-31 0001582982 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2024-01-01 2024-03-31 0001582982 us-gaap:TreasuryStockCommonMember 2024-01-01 2024-03-31 0001582982 2024-01-01 2024-03-31 0001582982 us-gaap:PreferredStockMember us-gaap:SeriesAPreferredStockMember 2024-04-01 2024-06-30 0001582982 us-gaap:PreferredStockMember us-gaap:SeriesBPreferredStockMember 2024-04-01 2024-06-30 0001582982 us-gaap:CommonStockMember 2024-04-01 2024-06-30 0001582982 us-gaap:AdditionalPaidInCapitalMember 2024-04-01 2024-06-30 0001582982 us-gaap:RetainedEarningsMember 2024-04-01 2024-06-30 0001582982 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2024-04-01 2024-06-30 0001582982 us-gaap:TreasuryStockCommonMember 2024-04-01 2024-06-30 0001582982 us-gaap:PreferredStockMember us-gaap:SeriesAPreferredStockMember 2025-06-30 0001582982 us-gaap:PreferredStockMember us-gaap:SeriesBPreferredStockMember 2025-06-30 0001582982 us-gaap:CommonStockMember 2025-06-30 0001582982 us-gaap:AdditionalPaidInCapitalMember 2025-06-30 0001582982 us-gaap:RetainedEarningsMember 2025-06-30 0001582982 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2025-06-30 0001582982 us-gaap:TreasuryStockCommonMember 2025-06-30 0001582982 us-gaap:PreferredStockMember us-gaap:SeriesAPreferredStockMember 2024-06-30 0001582982 us-gaap:PreferredStockMember us-gaap:SeriesBPreferredStockMember 2024-06-30 0001582982 us-gaap:CommonStockMember 2024-06-30 0001582982 us-gaap:AdditionalPaidInCapitalMember 2024-06-30 0001582982 us-gaap:RetainedEarningsMember 2024-06-30 0001582982 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2024-06-30 0001582982 us-gaap:TreasuryStockCommonMember 2024-06-30 0001582982 2024-06-30 0001582982 us-gaap:SeriesAPreferredStockMember 2024-01-01 2024-06-30 0001582982 us-gaap:SeriesBPreferredStockMember 2024-01-01 2024-06-30 0001582982 CCLD:RevNuMember 2025-01-04 2025-01-04 0001582982 CCLD:RevNuMember 2025-01-01 2025-06-30 0001582982 CCLD:ContractAssetMember 2025-01-01 2025-06-30 0001582982 us-gaap:CustomerRelationshipsMember 2025-01-01 2025-06-30 0001582982 us-gaap:OtherIntangibleAssetsMember 2025-01-01 2025-06-30 0001582982 srt:ProFormaMember 2025-04-01 2025-06-30 0001582982 srt:ProFormaMember 2024-04-01 2024-06-30 0001582982 srt:ProFormaMember 2025-01-01 2025-06-30 0001582982 srt:ProFormaMember 2024-01-01 2024-06-30 0001582982 CCLD:MedicalPracticeManagementSegmentMember 2025-06-30 0001582982 CCLD:MedicalPracticeManagementSegmentMember 2024-12-31 0001582982 us-gaap:CustomerRelationshipsMember 2025-06-30 0001582982 CCLD:ContingentConsiderationMember 2025-06-30 0001582982 us-gaap:OtherIntangibleAssetsMember 2025-06-30 0001582982 2024-01-01 2024-12-31 0001582982 us-gaap:CustomerRelationshipsMember 2024-12-31 0001582982 CCLD:CapitalizedSoftwareMember 2025-06-30 0001582982 CCLD:CapitalizedSoftwareMember 2024-12-31 0001582982 us-gaap:NoncompeteAgreementsMember 2025-06-30 0001582982 us-gaap:NoncompeteAgreementsMember 2024-12-31 0001582982 us-gaap:OtherIntangibleAssetsMember 2024-12-31 0001582982 us-gaap:PreferredStockMember 2025-04-01 2025-06-30 0001582982 us-gaap:PreferredStockMember 2025-01-01 2025-06-30 0001582982 us-gaap:PreferredStockMember 2024-04-01 2024-06-30 0001582982 us-gaap:PreferredStockMember 2024-01-01 2024-06-30 0001582982 us-gaap:RestrictedStockUnitsRSUMember 2024-04-01 2024-06-30 0001582982 us-gaap:RestrictedStockUnitsRSUMember 2024-01-01 2024-06-30 0001582982 us-gaap:RestrictedStockUnitsRSUMember 2025-04-01 2025-06-30 0001582982 us-gaap:RestrictedStockUnitsRSUMember 2025-01-01 2025-06-30 0001582982 CCLD:SVBCreditFacilityMember 2025-06-30 0001582982 CCLD:SVBCreditFacilityMember 2023-02-28 0001582982 CCLD:SVBCreditFacilityMember 2023-02-01 2023-02-28 0001582982 CCLD:SVBCreditFacilityMember 2023-08-30 0001582982 CCLD:SVBCreditFacilityMember 2023-08-31 0001582982 CCLD:SVBCreditFacilityMember 2023-08-30 2023-08-31 0001582982 2024-10-31 0001582982 CCLD:SVBCreditFacilityMember 2024-03-31 0001582982 CCLD:SVBCreditFacilityMember 2024-04-01 0001582982 CCLD:SVBCreditFacilityMember 2025-01-01 2025-06-30 0001582982 us-gaap:LineOfCreditMember 2025-04-01 2025-06-30 0001582982 us-gaap:LineOfCreditMember 2025-01-01 2025-06-30 0001582982 us-gaap:LineOfCreditMember 2024-04-01 2024-06-30 0001582982 us-gaap:LineOfCreditMember 2024-01-01 2024-06-30 0001582982 CCLD:RamapoAnesthesiologistsPCMember 2023-12-22 2023-12-22 0001582982 CCLD:RamapoAnesthesiologistsPCMember CCLD:AccruedExpensesMember 2023-12-22 0001582982 2021-03-01 2021-03-31 0001582982 2024-04-30 0001582982 2024-09-01 2024-09-30 0001582982 2024-12-01 2024-12-31 0001582982 2025-03-01 2025-03-31 0001582982 CCLD:PhysicianMember 2025-04-01 2025-06-30 0001582982 CCLD:PhysicianMember 2024-04-01 2024-06-30 0001582982 CCLD:PhysicianMember 2025-01-01 2025-06-30 0001582982 CCLD:PhysicianMember 2024-01-01 2024-06-30 0001582982 CCLD:PhysicianMember 2025-06-30 0001582982 CCLD:PhysicianMember 2024-12-31 0001582982 CCLD:ExecutiveChairmanMember 2025-04-01 2025-06-30 0001582982 CCLD:ExecutiveChairmanMember 2024-04-01 2024-06-30 0001582982 CCLD:ExecutiveChairmanMember 2025-01-01 2025-06-30 0001582982 CCLD:ExecutiveChairmanMember 2024-01-01 2024-06-30 0001582982 us-gaap:RelatedPartyMember 2025-06-30 0001582982 us-gaap:RelatedPartyMember 2024-12-31 0001582982 CCLD:FormerNonIndependentDirectorsMember us-gaap:SeriesBPreferredStockMember CCLD:ConsultingAgreementMember 2022-06-01 2022-06-30 0001582982 CCLD:FormerNonIndependentDirectorsMember us-gaap:SeriesBPreferredStockMember CCLD:ConsultingAgreementMember 2023-02-01 2023-02-28 0001582982 CCLD:FormerNonIndependentDirectorsMember us-gaap:SeriesBPreferredStockMember CCLD:ConsultingAgreementMember 2024-01-01 2024-01-31 0001582982 CCLD:FormerNonIndependentDirectorsMember CCLD:ConsultingAgreementMember 2024-02-01 2024-02-01 0001582982 CCLD:FormerNonIndependentDirectorsMember CCLD:ConsultingAgreementMember 2024-02-12 2024-02-12 0001582982 CCLD:FormerNonIndependentDirectorsMember CCLD:ConsultingAgreementMember 2024-09-01 2024-09-01 0001582982 CCLD:FormerNonIndependentDirectorsMember CCLD:ConsultingAgreementMember 2025-04-01 2025-06-30 0001582982 CCLD:FormerNonIndependentDirectorsMember CCLD:ConsultingAgreementMember 2024-04-01 2024-06-30 0001582982 CCLD:FormerNonIndependentDirectorsMember CCLD:ConsultingAgreementMember 2025-01-01 2025-06-30 0001582982 CCLD:FormerNonIndependentDirectorsMember CCLD:ConsultingAgreementMember 2024-01-01 2024-06-30 0001582982 CCLD:TalkMDCliniciansMember 2025-01-01 2025-06-30 0001582982 2023-01-01 2023-12-31 0001582982 CCLD:SeveranceAndSeparationCostsMember 2024-12-31 0001582982 CCLD:OtherExitRelatedCostsMember 2024-12-31 0001582982 CCLD:SeveranceAndSeparationCostsMember 2025-01-01 2025-06-30 0001582982 CCLD:OtherExitRelatedCostsMember 2025-01-01 2025-06-30 0001582982 CCLD:SeveranceAndSeparationCostsMember 2025-06-30 0001582982 CCLD:OtherExitRelatedCostsMember 2025-06-30 0001582982 CCLD:SeveranceAndSeparationCostsMember 2023-12-31 0001582982 CCLD:OtherExitRelatedCostsMember 2023-12-31 0001582982 CCLD:SeveranceAndSeparationCostsMember 2024-01-01 2024-12-31 0001582982 CCLD:OtherExitRelatedCostsMember 2024-01-01 2024-12-31 0001582982 2023-12-11 2023-12-11 0001582982 us-gaap:SeriesAPreferredStockMember CCLD:CertificateOfAmendmentMember 2024-09-11 2024-09-11 0001582982 2024-09-12 2024-09-12 0001582982 us-gaap:SeriesAPreferredStockMember 2024-09-11 2024-09-11 0001582982 2025-01-30 0001582982 2025-01-31 0001582982 us-gaap:SeriesAPreferredStockMember 2025-03-06 2025-03-06 0001582982 us-gaap:SeriesAPreferredStockMember CCLD:IndividualShareholdersMember 2025-03-06 0001582982 us-gaap:SeriesAPreferredStockMember CCLD:IndividualShareholdersMember 2025-01-01 2025-06-30 0001582982 us-gaap:SeriesAPreferredStockMember CCLD:IndividualShareholdersMember 2025-06-30 0001582982 us-gaap:SeriesAPreferredStockMember CCLD:IndividualShareholdersMember 2025-03-06 2025-03-06 0001582982 CCLD:HealthcareITMember CCLD:TechnologyEnabledBusinessSolutionsMember 2025-04-01 2025-06-30 0001582982 CCLD:HealthcareITMember CCLD:TechnologyEnabledBusinessSolutionsMember 2024-04-01 2024-06-30 0001582982 CCLD:HealthcareITMember CCLD:TechnologyEnabledBusinessSolutionsMember 2025-01-01 2025-06-30 0001582982 CCLD:HealthcareITMember CCLD:TechnologyEnabledBusinessSolutionsMember 2024-01-01 2024-06-30 0001582982 CCLD:HealthcareITMember CCLD:ProfessionalServicesMember 2025-04-01 2025-06-30 0001582982 CCLD:HealthcareITMember CCLD:ProfessionalServicesMember 2024-04-01 2024-06-30 0001582982 CCLD:HealthcareITMember CCLD:ProfessionalServicesMember 2025-01-01 2025-06-30 0001582982 CCLD:HealthcareITMember CCLD:ProfessionalServicesMember 2024-01-01 2024-06-30 0001582982 CCLD:HealthcareITMember CCLD:PrintingAndMailingServicesMember 2025-04-01 2025-06-30 0001582982 CCLD:HealthcareITMember CCLD:PrintingAndMailingServicesMember 2024-04-01 2024-06-30 0001582982 CCLD:HealthcareITMember CCLD:PrintingAndMailingServicesMember 2025-01-01 2025-06-30 0001582982 CCLD:HealthcareITMember CCLD:PrintingAndMailingServicesMember 2024-01-01 2024-06-30 0001582982 CCLD:HealthcareITMember CCLD:GroupPurchasingServicesMember 2025-04-01 2025-06-30 0001582982 CCLD:HealthcareITMember CCLD:GroupPurchasingServicesMember 2024-04-01 2024-06-30 0001582982 CCLD:HealthcareITMember CCLD:GroupPurchasingServicesMember 2025-01-01 2025-06-30 0001582982 CCLD:HealthcareITMember CCLD:GroupPurchasingServicesMember 2024-01-01 2024-06-30 0001582982 CCLD:MedicalPracticeManagementMember CCLD:MedicalPracticeManagementServicesMember 2025-04-01 2025-06-30 0001582982 CCLD:MedicalPracticeManagementMember CCLD:MedicalPracticeManagementServicesMember 2024-04-01 2024-06-30 0001582982 CCLD:MedicalPracticeManagementMember CCLD:MedicalPracticeManagementServicesMember 2025-01-01 2025-06-30 0001582982 CCLD:MedicalPracticeManagementMember CCLD:MedicalPracticeManagementServicesMember 2024-01-01 2024-06-30 0001582982 CCLD:ChronicCareManagementMember 2025-04-01 2025-06-30 0001582982 CCLD:ChronicCareManagementMember 2024-04-01 2024-06-30 0001582982 CCLD:ChronicCareManagementMember 2025-01-01 2025-06-30 0001582982 CCLD:ChronicCareManagementMember 2024-01-01 2024-06-30 0001582982 CCLD:RemotePatientMonitoringMember 2025-04-01 2025-06-30 0001582982 CCLD:RemotePatientMonitoringMember 2024-04-01 2024-06-30 0001582982 CCLD:RemotePatientMonitoringMember 2025-01-01 2025-06-30 0001582982 CCLD:RemotePatientMonitoringMember 2024-01-01 2024-06-30 0001582982 CCLD:ProfessionalServicesMember us-gaap:UnbilledRevenuesMember 2025-01-01 2025-06-30 0001582982 CCLD:ProfessionalServicesMember us-gaap:UnbilledRevenuesMember 2024-01-01 2024-06-30 0001582982 CCLD:RevenueCycleManagementMember 2025-06-30 0001582982 CCLD:GroupPurchasingServicesMember 2025-06-30 0001582982 CCLD:ReferralFeesMember 2025-06-30 0001582982 us-gaap:OtherNoncurrentAssetsMember 2025-06-30 0001582982 us-gaap:OtherNoncurrentAssetsMember 2024-06-30 0001582982 us-gaap:RestrictedStockUnitsRSUMember us-gaap:CommonStockMember 2025-06-30 0001582982 us-gaap:RestrictedStockUnitsRSUMember us-gaap:PreferredStockMember us-gaap:SeriesBPreferredStockMember 2025-06-30 0001582982 us-gaap:SeriesBPreferredStockMember 2023-10-01 2023-10-31 0001582982 us-gaap:SeriesBPreferredStockMember 2024-01-01 2024-12-31 0001582982 us-gaap:RestrictedStockUnitsRSUMember us-gaap:SeriesBPreferredStockMember 2024-03-01 2024-03-31 0001582982 us-gaap:SeriesBPreferredStockMember 2024-05-01 2024-05-31 0001582982 us-gaap:SeriesBPreferredStockMember 2025-04-01 2025-06-30 0001582982 us-gaap:SeriesBPreferredStockMember 2025-01-01 2025-06-30 0001582982 us-gaap:SeriesBPreferredStockMember 2024-04-01 2024-06-30 0001582982 us-gaap:RestrictedStockUnitsRSUMember us-gaap:CommonStockMember 2024-12-31 0001582982 us-gaap:RestrictedStockUnitsRSUMember us-gaap:SeriesAPreferredStockMember 2024-12-31 0001582982 us-gaap:RestrictedStockUnitsRSUMember us-gaap:SeriesBPreferredStockMember 2024-12-31 0001582982 us-gaap:RestrictedStockUnitsRSUMember us-gaap:CommonStockMember 2025-01-01 2025-06-30 0001582982 us-gaap:RestrictedStockUnitsRSUMember us-gaap:SeriesAPreferredStockMember 2025-01-01 2025-06-30 0001582982 us-gaap:RestrictedStockUnitsRSUMember us-gaap:SeriesBPreferredStockMember 2025-01-01 2025-06-30 0001582982 us-gaap:RestrictedStockUnitsRSUMember us-gaap:SeriesAPreferredStockMember 2025-06-30 0001582982 us-gaap:RestrictedStockUnitsRSUMember us-gaap:SeriesBPreferredStockMember 2025-06-30 0001582982 us-gaap:RestrictedStockUnitsRSUMember us-gaap:CommonStockMember 2023-12-31 0001582982 us-gaap:RestrictedStockUnitsRSUMember us-gaap:SeriesAPreferredStockMember 2023-12-31 0001582982 us-gaap:RestrictedStockUnitsRSUMember us-gaap:SeriesBPreferredStockMember 2023-12-31 0001582982 us-gaap:RestrictedStockUnitsRSUMember us-gaap:CommonStockMember 2024-01-01 2024-06-30 0001582982 us-gaap:RestrictedStockUnitsRSUMember us-gaap:SeriesAPreferredStockMember 2024-01-01 2024-06-30 0001582982 us-gaap:RestrictedStockUnitsRSUMember us-gaap:SeriesBPreferredStockMember 2024-01-01 2024-06-30 0001582982 us-gaap:RestrictedStockUnitsRSUMember us-gaap:CommonStockMember 2024-06-30 0001582982 us-gaap:RestrictedStockUnitsRSUMember us-gaap:SeriesAPreferredStockMember 2024-06-30 0001582982 us-gaap:RestrictedStockUnitsRSUMember us-gaap:SeriesBPreferredStockMember 2024-06-30 0001582982 CCLD:DirectOperatingCostsMember 2025-04-01 2025-06-30 0001582982 CCLD:DirectOperatingCostsMember 2024-04-01 2024-06-30 0001582982 CCLD:DirectOperatingCostsMember 2025-01-01 2025-06-30 0001582982 CCLD:DirectOperatingCostsMember 2024-01-01 2024-06-30 0001582982 us-gaap:GeneralAndAdministrativeExpenseMember 2025-04-01 2025-06-30 0001582982 us-gaap:GeneralAndAdministrativeExpenseMember 2024-04-01 2024-06-30 0001582982 us-gaap:GeneralAndAdministrativeExpenseMember 2025-01-01 2025-06-30 0001582982 us-gaap:GeneralAndAdministrativeExpenseMember 2024-01-01 2024-06-30 0001582982 us-gaap:ResearchAndDevelopmentExpenseMember 2025-04-01 2025-06-30 0001582982 us-gaap:ResearchAndDevelopmentExpenseMember 2024-04-01 2024-06-30 0001582982 us-gaap:ResearchAndDevelopmentExpenseMember 2025-01-01 2025-06-30 0001582982 us-gaap:ResearchAndDevelopmentExpenseMember 2024-01-01 2024-06-30 0001582982 us-gaap:SellingAndMarketingExpenseMember 2025-04-01 2025-06-30 0001582982 us-gaap:SellingAndMarketingExpenseMember 2024-04-01 2024-06-30 0001582982 us-gaap:SellingAndMarketingExpenseMember 2025-01-01 2025-06-30 0001582982 us-gaap:SellingAndMarketingExpenseMember 2024-01-01 2024-06-30 0001582982 CCLD:HealthcareITMember us-gaap:OperatingSegmentsMember 2025-01-01 2025-06-30 0001582982 CCLD:MedicalPracticeManagementMember us-gaap:OperatingSegmentsMember 2025-01-01 2025-06-30 0001582982 us-gaap:OperatingSegmentsMember 2025-01-01 2025-06-30 0001582982 CCLD:HealthcareITMember us-gaap:OperatingSegmentsMember 2025-04-01 2025-06-30 0001582982 CCLD:MedicalPracticeManagementMember us-gaap:OperatingSegmentsMember 2025-04-01 2025-06-30 0001582982 us-gaap:OperatingSegmentsMember 2025-04-01 2025-06-30 0001582982 CCLD:HealthcareITMember us-gaap:OperatingSegmentsMember 2024-01-01 2024-06-30 0001582982 CCLD:MedicalPracticeManagementMember us-gaap:OperatingSegmentsMember 2024-01-01 2024-06-30 0001582982 us-gaap:OperatingSegmentsMember 2024-01-01 2024-06-30 0001582982 CCLD:HealthcareITMember us-gaap:OperatingSegmentsMember 2024-04-01 2024-06-30 0001582982 CCLD:MedicalPracticeManagementMember us-gaap:OperatingSegmentsMember 2024-04-01 2024-06-30 0001582982 us-gaap:OperatingSegmentsMember 2024-04-01 2024-06-30 iso4217:USD xbrli:shares iso4217:USD xbrli:shares xbrli:pure CCLD:Segment

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 10-Q

(Mark one)

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2025

or

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission File Number: 001-36529

CareCloud, Inc.

(Exact name of registrant as specified in its charter)

Delaware |  | 22-3832302
(State or other jurisdiction of incorporation or organization) |  | (I.R.S. Employer Identification Number)

7 Clyde Road Somerset, New Jersey |  | 08873
(Address of principal executive offices) |  | (Zip Code)

(732) 873-5133

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class |  | Trading Symbol(s) |  | Name of each exchange on which registered
Common Stock, par value $0.001 per share |  | CCLD |  | Nasdaq Global Market
8.75% Series B Cumulative Redeemable Perpetual Preferred Stock, par value $0.001 per share |  | CCLDO |  | Nasdaq Global Market

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer ☐ | Accelerated filer ☐
Non-accelerated filer ☒ | Smaller reporting company ☒
| Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

At July 31, 2025, the registrant had 42,322,039 shares of common stock, par value $0.001 per share, outstanding.

INDEX

|  | Page
Forward-Looking Statements |  | 2
PART I. FINANCIAL INFORMATION
Item 1. | Condensed Consolidated Financial Statements (Unaudited) |  | 4
| Condensed Consolidated Balance Sheets at June 30, 2025 and December 31, 2024 |  | 4
| Condensed Consolidated Statements of Operations for the three and six months ended June 30, 2025 and 2024 |  | 5
| Condensed Consolidated Statements of Comprehensive Income for the three and six months ended June 30, 2025 and 2024 |  | 6
| Condensed Consolidated Statements of Shareholders’ Equity for the three and six months ended June 30, 2025 and 2024 |  | 7
| Condensed Consolidated Statements of Cash Flows for the six months ended June 30, 2025 and 2024 |  | 8
| Notes to Condensed Consolidated Financial Statements |  | 9
Item 2. | Management’s Discussion and Analysis of Financial Condition and Results of Operations |  | 29
Item 3. | Quantitative and Qualitative Disclosures about Market Risk |  | 39
Item 4. | Controls and Procedures |  | 39
PART II. OTHER INFORMATION
Item 1. | Legal Proceedings |  | 41
Item 1A. | Risk Factors |  | 41
Item 2. | Unregistered Sales of Equity Securities and Use of Proceeds |  | 41
Item 3. | Defaults Upon Senior Securities |  | 41
Item 4. | Mine Safety Disclosures |  | 41
Item 5. | Other Information |  | 41
Item 6. | Exhibits |  | 42
Signatures |  | 43

1

Forward-Looking Statements

Certain statements that we make from time to time, including statements contained in this Quarterly Report on Form 10-Q, constitute “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, or the Securities Act, and Section 21E of the Securities Exchange Act of 1934, as amended, or the Exchange Act. All statements other than statements of historical fact contained in this Quarterly Report on Form 10-Q are forward-looking statements. These statements relate to anticipated future events, future results of operations or future financial performance. In some cases, you can identify forward-looking statements by terminology such as “may,” “might,” “will,” “shall,” “should,” “could,” “intends,” “expects,” “plans,” “goals,” “projects,” “anticipates,” “believes,” “seeks,” “estimates,” “forecasts,” “predicts,” “possible,” “potential,” “target,” or “continue” or the negative of these terms or other comparable terminology. Our operations involve risks and uncertainties, many of which are outside of our control, and any one of which, or a combination of which, could materially affect our results of operations and whether the forward-looking statements ultimately prove to be correct. Forward-looking statements in this Quarterly Report on Form 10-Q include, without limitation, statements reflecting management’s expectations for future financial performance and operating expenditures (including our ability to continue as a going concern, to raise additional capital and to succeed in our future operations), expected growth, profitability and business outlook, increased sales and marketing expenses, and the expected results from the integration of our acquisitions.

Forward-looking statements are only predictions, are uncertain and involve substantial known and unknown risks, uncertainties, and other factors that may cause our (or our industry’s) actual results, levels of activity or performance to be materially different from any future results, levels of activity or performance expressed or implied by these forward-looking statements. These factors include, among other things, the unknown risks and uncertainties that we believe could cause actual results to differ from these forward-looking statements as set forth under the heading “Risk Factors” in our Annual Report on Form 10-K/A filed with the SEC on April 3, 2025. New risks and uncertainties emerge from time to time, and it is not possible for us to predict all of the risks and uncertainties that could have an impact on the forward-looking statements, including without limitation, risks and uncertainties relating to:

| ● | our ability to manage our growth, including acquiring, partnering with, and effectively integrating acquired businesses into our infrastructure and avoiding legal exposure and liabilities associated with acquired companies and assets;
| ● | our ability to retain our clients and revenue levels, including effectively migrating new clients and maintaining or growing the revenue levels of our new and existing clients;
| ● | our ability to maintain operations in Pakistan, Azad Jammu and Kashmir, and Sri Lanka (together, the “Offshore Offices”) in a manner that continues to enable us to offer competitively priced products and services;
| ● | our ability to keep pace with a rapidly changing healthcare industry;
| ● | our ability to consistently achieve and maintain compliance with a myriad of federal, state, foreign, local, payor and industry requirements, regulations, rules, laws and contracts;
| ● | our ability to maintain and protect the privacy of confidential and protected Company, client and patient information;
| ● | our ability to develop new technologies, upgrade and adapt legacy and acquired technologies to work with evolving industry standards and third-party software platforms and technologies, and protect and enforce all of these and other intellectual property rights;
| ● | our ability to attract and retain key officers and employees, and the continued involvement of Mahmud Haq as Executive Chairman and A. Hadi Chaudhry and Stephen Snyder as Co-Chief Executive Officers, all of which are critical to our ongoing operations and growing our business;
| ● | our ability to realize the expected cost savings and benefits from our restructuring activities and structural cost reductions;
| ● | our ability to comply with covenants contained in our credit agreement with our senior secured lender, Silicon Valley Bank, a division of First Citizens Bank, and other future debt facilities;
| ● | our ability to continue to pay our monthly dividends which were suspended in December 2023 and resumed in February 2025 to the holders of our Series A Preferred Stock and Series B Preferred Stock (together the “Preferred Stock”);
| ● | our ability to incorporate AI into our products faster and more successfully than our competitors, protecting the privacy of medical records and cybersecurity threats;
| ● | our ability to compete with other companies developing products and selling services competitive with ours, and who may have greater resources and name recognition than we have;

2

| ● | our ability to effectively integrate, manage and keep our information systems secure and operational in the event of a cyber-attack;
| ● | our ability to respond to the uncertainty resulting from pandemics, epidemics or other public health emergencies and the impact they may have on our operations, the demand for our services, our projected results of operations, financial performance or other financial metrics or any of the foregoing risks and economic activity in general;
| ● | our ability to keep and increase market acceptance of our products and services;
| ● | changes in domestic and foreign business, market, financial, political and legal conditions; and
| ● | other factors disclosed in this Quarterly Report on Form 10-Q or our other filings with the Securities and Exchange Commission (the “SEC”).

The forward-looking statements contained in this Quarterly Report on Form 10-Q are based on our current expectations, beliefs and views as of the date of this Quarterly Report on Form 10-Q concerning future developments and their potential effects on our business. Although we believe that the expectations reflected in the forward-looking statements contained in this Quarterly Report on Form 10-Q are reasonable, we cannot guarantee future results, levels of activity, performance, or achievements. We anticipate that subsequent events and developments may cause our assessments to change. Except as required by law, we are under no duty to update or revise any of such forward-looking statements, whether as a result of new information, future events, or otherwise, after the date of this Quarterly Report on Form 10-Q.

You should read this Quarterly Report on Form 10-Q with the understanding that our actual future results, levels of activity, performance and events and circumstances may be materially different from what we currently expect. The forward-looking statements contained herein should not be relied upon as representing our assessments as of any date subsequent to the date of this Quarterly Report on Form 10-Q.

3

PART I. FINANCIAL INFORMATION

Item 1. Condensed Consolidated Financial Statements

CARECLOUD, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

($ in thousands, except share and per share amounts)

|  | June 30, |  |  | December 31, |
|  | 2025 |  |  | 2024 |
|  | (Unaudited) |  |  |  |
ASSETS |  |  |  |  |  |  |  |
Current assets: |  |  |  |  |  |  |  |
Cash |  | $ | 10,440 |  |  | $ | 5,145 |
Accounts receivable - net |  |  | 13,563 |  |  |  | 12,774 |
Contract asset |  |  | 3,955 |  |  |  | 4,334 |
Inventory |  |  | 523 |  |  |  | 574 |
Current assets - related party |  |  | 16 |  |  |  | 16 |
Prepaid expenses and other current assets |  |  | 2,593 |  |  |  | 1,957 |
Total current assets |  |  | 31,090 |  |  |  | 24,800 |
Property and equipment - net |  |  | 5,828 |  |  |  | 5,290 |
Operating lease right-of-use assets |  |  | 3,058 |  |  |  | 3,133 |
Intangible assets - net |  |  | 15,512 |  |  |  | 18,698 |
Goodwill |  |  | 19,192 |  |  |  | 19,186 |
Other assets |  |  | 564 |  |  |  | 507 |
TOTAL ASSETS |  | $ | 75,244 |  |  | $ | 71,614 |
LIABILITIES AND SHAREHOLDERS' EQUITY |  |  |  |  |  |  |  |
Current liabilities: |  |  |  |  |  |  |  |
Accounts payable |  | $ | 4,215 |  |  | $ | 4,565 |
Accrued compensation |  |  | 3,324 |  |  |  | 1,817 |
Accrued expenses |  |  | 4,909 |  |  |  | 4,951 |
Operating lease liability (current portion) |  |  | 1,294 |  |  |  | 1,287 |
Deferred revenue (current portion) |  |  | 1,232 |  |  |  | 1,212 |
Notes payable (current portion) |  |  | 222 |  |  |  | 310 |
Contingent consideration (current portion) |  |  | 330 |  |  |  | - |
Dividend payable |  |  | 714 |  |  |  | 5,438 |
Total current liabilities |  |  | 16,240 |  |  |  | 19,580 |
Notes payable |  |  | 86 |  |  |  | 26 |
Contingent consideration |  |  | 426 |  |  |  | - |
Operating lease liability |  |  | 1,785 |  |  |  | 1,847 |
Deferred revenue |  |  | 631 |  |  |  | 387 |
Total liabilities |  |  | 19,168 |  |  |  | 21,840 |
COMMITMENTS AND CONTINGENCIES (NOTE 9) |  |  | - |  |  |  | - |
SHAREHOLDERS’ EQUITY: |  |  |  |  |  |  |  |
Preferred stock, $0.001 par value - authorized 7,000,000 shares. Series A, issued and outstanding 984,530 and 4,526,231 shares at June 30, 2025 and December 31, 2024, respectively. Series B, issued and outstanding 1,511,372 shares at June 30, 2025 and December 31, 2024. |  |  | 2 |  |  |  | 6 |
Common stock, $0.001 par value - authorized 85,000,000 shares. Issued 43,062,838 and 16,997,035 shares at June 30, 2025 and December 31, 2024, respectively. Outstanding 42,322,039 and 16,256,236 shares at June 30, 2025 and December 31, 2024, respectively |  |  | 43 |  |  |  | 17 |
Additional paid-in capital |  |  | 122,635 |  |  |  | 121,046 |
Accumulated deficit |  |  | (61,780 | ) |  |  | (66,630 | )
Accumulated other comprehensive loss |  |  | (4,162 | ) |  |  | (4,003 | )
Less: 740,799 common shares held in treasury, at cost at June 30, 2025 and December 31, 2024 |  |  | (662 | ) |  |  | (662 | )
Total shareholders’ equity |  |  | 56,076 |  |  |  | 49,774 |
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY |  | $ | 75,244 |  |  | $ | 71,614 |

See notes to condensed consolidated financial statements.

4

CARECLOUD, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)

($ in thousands, except share and per share amounts)

|  | 2025 |  |  | 2024 |  |  | 2025 |  |  | 2024 |
|  | Three Months Ended |  |  | Six Months Ended |
|  | June 30, |  |  | June 30, |
|  | 2025 |  |  | 2024 |  |  | 2025 |  |  | 2024 |
NET REVENUE |  | $ | 27,377 |  |  | $ | 28,090 |  |  | $ | 55,009 |  |  | $ | 54,052 |
OPERATING EXPENSES: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Direct operating costs |  |  | 14,480 |  |  |  | 15,242 |  |  |  | 29,944 |  |  |  | 30,419 |
Selling and marketing |  |  | 1,118 |  |  |  | 1,664 |  |  |  | 2,249 |  |  |  | 3,434 |
General and administrative |  |  | 4,358 |  |  |  | 4,028 |  |  |  | 8,690 |  |  |  | 7,749 |
Research and development |  |  | 1,020 |  |  |  | 1,055 |  |  |  | 2,255 |  |  |  | 1,968 |
Depreciation and amortization |  |  | 3,382 |  |  |  | 3,714 |  |  |  | 6,719 |  |  |  | 7,644 |
Restructuring costs |  |  | 23 |  |  |  | 116 |  |  |  | 137 |  |  |  | 438 |
Total operating expenses |  |  | 24,381 |  |  |  | 25,819 |  |  |  | 49,994 |  |  |  | 51,652 |
OPERATING INCOME |  |  | 2,996 |  |  |  | 2,271 |  |  |  | 5,015 |  |  |  | 2,400 |
OTHER: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Interest income |  |  | 51 |  |  |  | 24 |  |  |  | 93 |  |  |  | 51 |
Interest expense |  |  | (68 | ) |  |  | (288 | ) |  |  | (126 | ) |  |  | (653 | )
Other expense - net |  |  | (35 | ) |  |  | (294 | ) |  |  | (49 | ) |  |  | (287 | )
INCOME BEFORE PROVISION FOR INCOME TAXES |  |  | 2,944 |  |  |  | 1,713 |  |  |  | 4,933 |  |  |  | 1,511 |
Income tax provision |  |  | 42 |  |  |  | 39 |  |  |  | 83 |  |  |  | 78 |
NET INCOME |  | $ | 2,902 |  |  | $ | 1,674 |  |  | $ | 4,850 |  |  | $ | 1,433 |
Preferred stock dividend |  |  | 1,365 |  |  |  | 3,923 |  |  |  | 4,176 |  |  |  | 5,235 |
NET INCOME (LOSS) ATTRIBUTABLE TO COMMON SHAREHOLDERS |  | $ | 1,537 |  |  | $ | (2,249 | ) |  | $ | 674 |  |  | $ | (3,802 | )
Net income (loss) per common share: basic and diluted |  | $ | 0.04 |  |  | $ | (0.14 | ) |  | $ | 0.02 |  |  | $ | (0.24 | )
Weighted-average common shares used to compute basic and diluted loss per share |  |  | 42,321,629 |  |  |  | 16,132,420 |  |  |  | 33,118,912 |  |  |  | 16,073,364 |

See notes to condensed consolidated financial statements.

5

CARECLOUD, INC.

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (UNAUDITED)

($ in thousands)

|  | 2025 |  |  | 2024 |  |  | 2025 |  |  | 2024 |
|  | Three Months Ended |  |  | Six Months Ended |
|  | June 30, |  |  | June 30, |
|  | 2025 |  |  | 2024 |  |  | 2025 |  |  | 2024 |
NET INCOME |  | $ | 2,902 |  |  | $ | 1,674 |  |  | $ | 4,850 |  |  | $ | 1,433 |
OTHER COMPREHENSIVE LOSS |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Foreign currency translation adjustment (a) |  |  | (101 | ) |  |  | (68 | ) |  |  | (159 | ) |  |  | (40 | )
COMPREHENSIVE INCOME |  | $ | 2,801 |  |  | $ | 1,606 |  |  | $ | 4,691 |  |  | $ | 1,393 |

(a) |  | No tax effect has been recorded as the Company recorded a valuation allowance against the tax benefit from its foreign currency translation adjustments.

See notes to condensed consolidated financial statements.

6

CARECLOUD, INC.

CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY (UNAUDITED)

FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2025 AND JUNE 30, 2024

($ in thousands, except for number of shares)

|  | Shares |  |  | Amount |  |  | Shares |  |  | Amount |  |  | Shares |  |  | Amount |  |  | Capital |  |  | Deficit |  |  | Loss |  |  | Stock |  |  | Equity |
|  | Preferred Stock Series A |  |  | Preferred Stock Series B |  |  | Common Stock |  |  | Additional Paid-in |  |  | Accumulated |  |  | Accumulated Other Comprehensive |  |  | Treasury (Common) |  |  | Total Shareholders’ |
|  | Shares |  |  | Amount |  |  | Shares |  |  | Amount |  |  | Shares |  |  | Amount |  |  | Capital |  |  | Deficit |  |  | Loss |  |  | Stock |  |  | Equity |
Balance - January 1, 2025 |  |  | 4,526,231 |  |  | $ | 5 |  |  |  | 1,511,372 |  |  | $ | 1 |  |  |  | 16,997,035 |  |  | $ | 17 |  |  | $ | 121,046 |  |  | $ | (66,630 | ) |  | $ | (4,003 | ) |  | $ | (662 | ) |  | $ | 49,774 |
Net income |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 1,948 |  |  |  | - |  |  |  | - |  |  |  | 1,948 |
Foreign currency translation adjustment |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | (58 | ) |  |  | - |  |  |  | (58 | )
Conversion of preferred stock and accrued dividends to common stock |  |  | (3,541,701 | ) |  |  | (4 | ) |  |  | - |  |  |  | - |  |  |  | 25,981,248 |  |  |  | 26 |  |  |  | 2,413 |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 2,435 |
Issuance of stock under the equity incentive plan |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 83,645 |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |
Stock-based compensation, net of cash settlements |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 104 |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 104 |
Preferred stock dividends |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | (26 | ) |  |  | - |  |  |  | - |  |  |  | - |  |  |  | (26 | )
Balance - March 31, 2025 |  |  | 984,530 |  |  | $ | 1 |  |  |  | 1,511,372 |  |  | $ | 1 |  |  |  | 43,061,928 |  |  | $ | 43 |  |  | $ | 123,537 |  |  | $ | (64,682 | ) |  | $ | (4,061 | ) |  | $ | (662 | ) |  | $ | 54,177 |
Balance - April 1, 2025 |  |  | 984,530 |  |  | $ | 1 |  |  |  | 1,511,372 |  |  | $ | 1 |  |  |  | 43,061,928 |  |  | $ | 43 |  |  | $ | 123,537 |  |  | $ | (64,682 | ) |  | $ | (4,061 | ) |  | $ | (662 | ) |  | $ | 54,177 |
Net income |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 2,902 |  |  |  | - |  |  |  | - |  |  |  | 2,902 |
Foreign currency translation adjustment |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | (101 | ) |  |  | - |  |  |  | (101 | )
Issuance of stock under the equity incentive plan |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 910 |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |
Stock-based compensation, net of cash settlements |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 100 |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 100 |
Preferred stock dividends |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | (1,002 | ) |  |  | - |  |  |  | - |  |  |  | - |  |  |  | (1,002 | )
Balance - June 30, 2025 |  |  | 984,530 |  |  | $ | 1 |  |  |  | 1,511,372 |  |  | $ | 1 |  |  |  | 43,062,838 |  |  | $ | 43 |  |  | $ | 122,635 |  |  | $ | (61,780 | ) |  | $ | (4,162 | ) |  | $ | (662 | ) |  | $ | 56,076 |
Balance - January 1, 2024 |  |  | 4,526,231 |  |  | $ | 5 |  |  |  | 1,468,792 |  |  | $ | 1 |  |  |  | 16,620,891 |  |  | $ | 17 |  |  | $ | 120,706 |  |  | $ | (74,481 | ) |  | $ | (3,869 | ) |  | $ | (662 | ) |  | $ | 41,717 |
Net loss |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | (241 | ) |  |  | - |  |  |  | - |  |  |  | (241 | )
Foreign currency translation adjustment |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 28 |  |  |  | - |  |  |  | 28 |
Issuance of stock under the equity incentive plan |  |  | - |  |  |  | - |  |  |  | 14,000 |  |  |  | - |  |  |  | 238,400 |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |
Stock-based compensation, net of cash settlements |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | (79 | ) |  |  | - |  |  |  | - |  |  |  | - |  |  |  | (79 | )
Preferred stock dividends |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | (5 | ) |  |  | - |  |  |  | - |  |  |  | - |  |  |  | (5 | )
Balance - March 31, 2024 |  |  | 4,526,231 |  |  | $ | 5 |  |  |  | 1,482,792 |  |  | $ | 1 |  |  |  | 16,859,291 |  |  | $ | 17 |  |  | $ | 120,622 |  |  | $ | (74,722 | ) |  | $ | (3,841 | ) |  | $ | (662 | ) |  | $ | 41,420 |
Balance - April 1, 2024 |  |  | 4,526,231 |  |  | $ | 5 |  |  |  | 1,482,792 |  |  | $ | 1 |  |  |  | 16,859,291 |  |  | $ | 17 |  |  | $ | 120,622 |  |  | $ | (74,722 | ) |  | $ | (3,841 | ) |  | $ | (662 | ) |  | $ | 41,420 |
Balance |  |  | 4,526,231 |  |  | $ | 5 |  |  |  | 1,482,792 |  |  | $ | 1 |  |  |  | 16,859,291 |  |  | $ | 17 |  |  | $ | 120,622 |  |  | $ | (74,722 | ) |  | $ | (3,841 | ) |  | $ | (662 | ) |  | $ | 41,420 |
Net income |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 1,674 |  |  |  | - |  |  |  | - |  |  |  | 1,674 |
Net income (loss) |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 1,674 |  |  |  | - |  |  |  | - |  |  |  | 1,674 |
Foreign currency translation adjustment |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | (68 | ) |  |  | - |  |  |  | (68 | )
Issuance of stock under the equity incentive plan |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 26,695 |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |
Stock-based compensation, net of cash settlements |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 218 |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 218 |
Balance - June 30, 2024 |  |  | 4,526,231 |  |  | $ | 5 |  |  |  | 1,482,792 |  |  | $ | 1 |  |  |  | 16,885,986 |  |  | $ | 17 |  |  | $ | 120,840 |  |  | $ | (73,048 | ) |  | $ | (3,909 | ) |  | $ | (662 | ) |  | $ | 43,244 |
Balance |  |  | 4,526,231 |  |  | $ | 5 |  |  |  | 1,482,792 |  |  | $ | 1 |  |  |  | 16,885,986 |  |  | $ | 17 |  |  | $ | 120,840 |  |  | $ | (73,048 | ) |  | $ | (3,909 | ) |  | $ | (662 | ) |  | $ | 43,244 |

For the six months ended June 30, 2025, the Company declared six months of dividends and paid five months of dividends on the Preferred Shares.

No dividends were declared or paid during the six months ended June 30, 2024.

See notes to condensed consolidated financial statements.

7

CARECLOUD, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)

FOR THE SIX MONTHS ENDED JUNE 30, 2025 AND 2024

($ in thousands)

|  | 2025 |  |  | 2024 |
OPERATING ACTIVITIES: |  |  |  |  |  |  |  |
Net income |  | $ | 4,850 |  |  | $ | 1,433 |
Adjustments to reconcile net income to net cash provided by operating activities: |  |  |  |  |  |  |  |
Depreciation and amortization |  |  | 6,855 |  |  |  | 7,818 |
Lease amortization |  |  | 901 |  |  |  | 1,008 |
Deferred revenue |  |  | 264 |  |  |  | (22 | )
Provision for expected credit losses |  |  | 169 |  |  |  | 123 |
Foreign exchange loss (gain) |  |  | 1 |  |  |  | (57 | )
Interest accretion |  |  | 219 |  |  |  | 321 |
Stock-based compensation expense (benefit) |  |  | 219 |  |  |  | (443 | )
Changes in operating assets and liabilities: |  |  |  |  |  |  |  |
Accounts receivable |  |  | (958 | ) |  |  | (1,314 | )
Contract asset |  |  | 411 |  |  |  | 294 |
Inventory |  |  | 51 |  |  |  | (32 | )
Other assets |  |  | (838 | ) |  |  | (825 | )
Accounts payable and other liabilities |  |  | 377 |  |  |  | 41 |
Net cash provided by operating activities |  |  | 12,521 |  |  |  | 8,345 |
INVESTING ACTIVITIES: |  |  |  |  |  |  |  |
Purchases of property and equipment |  |  | (1,786 | ) |  |  | (425 | )
Capitalized software and other intangible assets |  |  | (1,677 | ) |  |  | (3,046 | )
Initial payment for acquisition |  |  | (40 | ) |  |  | - |
Net cash used in investing activities |  |  | (3,503 | ) |  |  | (3,471 | )
FINANCING ACTIVITIES: |  |  |  |  |  |  |  |
Preferred stock dividends paid |  |  | (3,317 | ) |  |  | - |
Settlement of tax withholding obligations on stock issued to employees |  |  | (22 | ) |  |  | (184 | )
Repayments of notes payable |  |  | (355 | ) |  |  | (328 | )
Repayment of line of credit |  |  | - |  |  |  | (5,000 | )
Net cash used in financing activities |  |  | (3,694 | ) |  |  | (5,512 | )
EFFECT OF EXCHANGE RATE CHANGES ON CASH |  |  | (29 | ) |  |  | (76 | )
NET INCREASE (DECREASE) IN CASH |  |  | 5,295 |  |  |  | (714 | )
CASH - Beginning of the period |  |  | 5,145 |  |  |  | 3,331 |
CASH - End of the period |  | $ | 10,440 |  |  | $ | 2,617 |
SUPPLEMENTAL NONCASH INVESTING AND FINANCING ACTIVITIES: |  |  |  |  |  |  |  |
Conversion of preferred stock and accrued dividends to common stock |  | $ | 2,435 |  |  | $ | - |
Dividends declared, not paid |  | $ | 714 |  |  | $ | 5 |
Purchase of prepaid insurance with assumption of note |  | $ | - |  |  | $ | 96 |
Reclass of deposits for property and equipment placed in service |  | $ | - |  |  | $ | 296 |
SUPPLEMENTAL INFORMATION - Cash paid during the period for: |  |  |  |  |  |  |  |
Income taxes |  | $ | 144 |  |  | $ | 122 |
Interest |  | $ | 44 |  |  | $ | 527 |

See notes to condensed consolidated financial statements.

8

CARECLOUD, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

AS OF AND FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2025

AND 2024 (UNAUDITED)

1. ORGANIZATION AND BUSINESS

CareCloud, Inc., (together with its consolidated subsidiaries, “CareCloud,” the “Company,” “we,” “us” and/or “our”) is a leading provider of technology-enabled services and generative AI solutions. We provide technology-enabled revenue cycle management and a full suite of proprietary cloud-based solutions to healthcare providers, from small practices to enterprise medical groups, hospitals, and health systems throughout the United States. Healthcare organizations today operate in highly complex and regulated environments. Our suite of technology-enabled solutions helps our clients increase financial and operational performance, streamline clinical workflows, and improve the patient experience.

Our portfolio of proprietary software and business services includes: technology-enabled business solutions that maximize revenue cycle management and create efficiencies through platform agnostic AI-driven applications; cloud-based software that helps providers manage their practice and patient engagement while leveraging analytics to improve provider performance; digital health services to address value-based care and enable the delivery of remote patient care; healthcare IT professional services & staffing to address physician burnout, staffing shortages and leverage consulting expertise to transition into the next generation of healthcare; and, medical practice management services to assist medical providers with operating models and the tools needed to run their practice. Our high-value business services, such as revenue cycle management, are often paired with our cloud-based software, premiere healthcare consulting and implementation services, and on-demand workforce staffing capabilities for high-performance medical groups and health systems nationwide.

CareCloud has its corporate office in Somerset, New Jersey and maintains client support teams throughout the U.S., and offshore offices in Pakistan and Azad Jammu and Kashmir, a region administered by Pakistan (the “Pakistan Offices”), and in Sri Lanka.

2. BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial reporting and as required by Regulation S-X, Rule 8-03. Accordingly, they do not include all of the information and notes required by GAAP for complete financial statements. In the opinion of the Company’s management, the accompanying unaudited condensed consolidated financial statements contain all adjustments (consisting of items of a normal and recurring nature) necessary to present fairly the Company’s financial position as of June 30, 2025, the results of operations for the three and six months ended June 30, 2025 and 2024 and cash flows for the six months ended June 30, 2025 and 2024. When preparing financial statements in conformity with GAAP, the Company must make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ significantly from those estimates. The condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation.

The accompanying unaudited condensed consolidated financial statements and notes thereto should be read in conjunction with the audited consolidated financial statements for the year ended December 31, 2024, which are included in the Company’s Annual Report on Form 10-K/A filed with the SEC on April 3, 2025.

Significant Accounting Policies — During the six months ended June 30, 2025, there were no changes to the Company’s significant accounting policies from its disclosures in the Annual Report on Form 10-K/A for the year ended December 31, 2024, filed with the SEC on April 3, 2025.

9

Recent Accounting Pronouncements — From time to time, new accounting pronouncements are issued by the Financial Accounting Standards Board (“FASB”) and are adopted by us as of the specified effective date. Unless otherwise discussed, we believe that the impact of recently adopted and recently issued accounting pronouncements will not have a material impact on our condensed consolidated financial position, results of operations and cash flows.

In March 2023, the FASB issued ASU 2023-01, Leases (Topic 842): Common Control Arrangements – Issue 2. The amendments in this update require that leasehold improvements associated with common control leases be: (1) amortized by the lessee over the useful life of the leasehold improvements to the common control group as long as the lessee controls the use of the underlying asset through a lease and (2) accounted for as a transfer between entities under common control through an adjustment to equity if, and when, the lessee no longer controls the use of the underlying asset. The amendments in this update are effective for fiscal years beginning after December 15, 2023. There was no impact on the consolidated financial statements as a result of this standard.

In October 2023, the FASB issued ASU 2023-06, Disclosure Improvements: Codification Amendments in Response to the SEC’s Disclosure Update and Simplification Initiative. This update amends the disclosure or presentation requirements related to various subtopics in the FASB Accounting Standards Codification (the “Codification”). The new guidance is intended to align U.S. GAAP requirements with those of the SEC and to facilitate the application of U.S. GAAP for all entities. The effective date for each amendment will be the date on which the SEC’s removal of that related disclosure requirement from Regulation S-X or Regulation S-K becomes effective, with early adoption prohibited. If by June 30, 2027 the SEC has not removed the applicable requirement from Regulation S-X or Regulation S-K, the pending content of the associated amendment will be removed from the Codification and will not become effective.

In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280), Improvements to Reportable Disclosures. The amendments in this update improve segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses. The amendments are effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024. The impact was only to the financial statement disclosures, which have been adopted by the Company.

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740), Improvements to Income Tax Disclosures. The amendments in this update enhance the transparency and decision usefulness of income tax disclosures primarily related to rate reconciliation and income taxes paid information. The update also includes certain other amendments to improve the effectiveness of income tax disclosures. The amendments are effective for annual periods beginning after December 15, 2024. The Company does not expect this update to have a material impact on the consolidated financial statements.

In March 2024, the FASB issued ASU 2024-02, Codification Improvements – Amendments to Remove References to the Concepts Statements. This update contains amendments to the Codification that remove references to various FASB Concepts Statements. These Codification updates are for technical corrections such as conforming amendments, clarifications to guidance, simplifications to wording or the structure of guidance and other minor improvements. The resulting amendments are referred to as Codification improvements. The amendments in this update are effective for public business entities for fiscal years beginning after December 15, 2024. There was no impact on the consolidated financial statements as a result of this standard.

In November 2024, the FASB issued ASU 2024-03, Income Statement – Reporting Comprehensive Income – Expense Disaggregation Disclosures (Subtopic 220-40). This update contains amendments that require disclosure, in the notes to financial statements, of specified information about certain costs and expenses. The amendments in this update are effective for public business entities for annual reporting periods beginning after December 15, 2026, and interim reporting periods beginning after December 15, 2027. Early adoption is permitted. The expected impact would only be to the financial statement disclosures.

In January 2025, the FASB issued ASU 2025-01, Income Statement – Reporting Comprehensive Income – Expense Disaggregation Disclosures (Subtopic 220-40): Clarifying the Effective Date. This update clarifies the effective date of ASU 2024-03. Public business entities are required to adopt the guidance in annual reporting periods beginning after December 15, 2026, and interim periods within annual reporting periods beginning after December 15, 2027. Early adoption is permitted. The expected impact would only be to the financial statement disclosures.

10

3. PREPAID EXPENSES AND OTHER CURRENT ASSETs

Prepaid expenses and other current assets as of June 30, 2025 and December 31, 2024 consist of the following:

SCHEDULE OF PREPAID EXPENSES AND OTHER CURRENT ASSET

|  | June 30, 2025 |  |  | December 31, 2024 |
|  | ($ in thousands) |
Prepayments to vendors |  | $ | 1,567 |  |  | $ | 1,099 |
Prepaid credit card |  |  | 545 |  |  |  | - |
Prepaid insurance |  |  | 167 |  |  |  | 494 |
Prepaid commissions |  |  | 183 |  |  |  | 243 |
Other |  |  | 131 |  |  |  | 121 |
Prepaid expenses and other current assets |  | $ | 2,593 |  |  | $ | 1,957 |

4. ACQUISITION

On April 1, 2025 (the “RevNu Closing Date”), the Company entered into an Asset Purchase Agreement (“APA”) with Gratius Enterprises, Inc., doing business as RevNu Medical Management (“RevNu”), pursuant to which the Company acquired certain assets of RevNu. The acquisition has been accounted for as a business combination. Under the APA, the Company is obligated to make quarterly payments equal to twenty percent (20%) of the revenue generated from the acquired RevNu client accounts for a period of forty-two (42) months following the RevNu Closing Date (the “RevNu Quarterly Payments”). The total purchase price is contingent upon future revenue performance and includes the estimated fair value of the RevNu Quarterly Payments. In the event that the service agreement with a specified customer is terminated, the Company will have no further obligation to make additional payments under the APA. Through June 30, 2025, the quarterly payment due to RevNu was approximately $42,000.

RevNu was in the business of providing audiology and hearing aid billing/revenue cycle IT solutions and related services to hearing healthcare providers/practices.

The total consideration for this acquisition consists of contingent consideration of approximately $649,000.

The preliminary purchase price allocation of RevNu is summarized as follows:

SCHEDULE OF PRELIMINARY PURCHASE PRICE ALLOCATION

|  | ($ in thousands) |
Contract asset |  | $ | 14 |
Customer relationships |  |  | 629 |
Goodwill |  |  | 6 |
Total preliminary purchase price allocation |  | $ | 649 |

The fair value of the contract asset was based on the expected revenue earned by RevNu as of the RevNu Closing Date. The fair value of customer relationships was based on the estimated discounted cash flows generated by these intangibles. The goodwill represents the Company’s ability to expand in the audiology and hearing aid market. The goodwill from this acquisition is deductible ratably for income tax purposes over fifteen years. It was estimated that the probable future payments required under the APA will be approximately $649,000 which has been recorded as part of the preliminary purchase price allocation as contingent consideration.

The Company performed the valuation of the acquired assets and the contingent consideration. The weighted-average amortization period of the acquired intangible assets is approximately three years.

Revenue earned from the clients obtained from the RevNu acquisition was approximately $333,000 during the three and six months ended June 30, 2025.

The RevNu acquisition added additional clients to the Company’s customer base and, similar to previous acquisitions, broadened the Company’s presence in the healthcare information technology industry through expansion of its customer base and by increasing available customer relationship resources and specialized trained staff.

11

Pro forma financial information (Unaudited)

The unaudited pro forma information below represents the Company’s condensed consolidated results of operations as if the RevNu and one other acquisition had both occurred on January 1, 2024. The pro forma information has been included for comparative purposes and is not indicative of results of operations the Company would have had if the acquisitions occurred on the above date, nor is it necessarily indicative of future results. The unaudited pro forma information reflects material, non-recurring pro forma adjustments directly attributable to the business combinations. There was no difference between the actual revenue and the pro forma revenue for the three months ended June 30, 2025. The difference between the actual revenue and the pro forma revenue is approximately $521,000 for the six months ended June 30, 2025, and $517,000 and $1.1 million for the three and six months ended June 30, 2024, respectively and are reflected as pro forma adjustments below. These differences primarily represent revenue recorded by RevNu and one other acquisition. Other differences arise from amortizing purchased intangibles using the double declining balance method.

SCHEDULE OF PRO FORMA FINANCIAL INFORMATION

|  | 2025 |  |  | 2024 |  |  | 2025 |  |  | 2024 |
|  | Three Months Ended June 30, |  |  | Six Months Ended June 30, |
|  | 2025 |  |  | 2024 |  |  | 2025 |  |  | 2024 |
|  | ($ in thousands, except per share amounts) |
Total revenue |  | $ | 27,377 |  |  | $ | 28,607 |  |  | $ | 55,530 |  |  | $ | 55,115 |
Net income |  | $ | 2,969 |  |  | $ | 1,554 |  |  | $ | 4,965 |  |  | $ | 1,174 |
Net income (loss) attributable to common shareholders |  | $ | 1,604 |  |  | $ | (2,369 | ) |  | $ | 789 |  |  | $ | (4,061 | )
Net income (loss) per common share |  | $ | 0.04 |  |  | $ | (0.15 | ) |  | $ | 0.02 |  |  | $ | (0.25 | )

5. GOODWILL AND INTANGIBLE ASSETS-NET

Goodwill consists of the excess of the purchase price over the fair value of identifiable net assets of businesses acquired. At June 30, 2025 and December 31, 2024, approximately $90,000 of goodwill was allocated to the Medical Practice Management segment and the balance was allocated to the Healthcare IT segment.

For the six months ended June 30, 2025, the Company recorded total acquisition-related intangible assets of approximately $758,000 in customer relationships, approximately $756,000 in contingent consideration, and $6,000 in goodwill, related to the above acquisitions.

The following is the summary of the carrying amount of goodwill for the six months ended June 30, 2025 and the year ended December 31, 2024:

SCHEDULE OF CHANGES TO CARRYING AMOUNT OF GOODWILL

|  | Six Months Ended June 30, 2025 |  |  | Year Ended December 31, 2024 |
|  | ($ in thousands) |
Beginning gross balance |  | $ | 19,186 |  |  | $ | 19,186 |
Additions |  |  | 6 |  |  |  | - |
Ending gross balance |  | $ | 19,192 |  |  | $ | 19,186 |

12

Intangible assets – net as of June 30, 2025 and December 31, 2024 consist of the following:

SCHEDULE OF INTANGIBLE ASSETS

|  | June 30, 2025 |  |  | December 31, 2024 |
|  | ($ in thousands) |
Contracts and relationships acquired |  | $ | 48,355 |  |  | $ | 47,597 |
Capitalized software |  |  | 36,660 |  |  |  | 35,108 |
Non-compete agreements |  |  | 1,236 |  |  |  | 1,236 |
Other intangible assets |  |  | 8,417 |  |  |  | 8,417 |
Total intangible assets |  |  | 94,668 |  |  |  | 92,358 |
Less: Accumulated amortization |  |  | 79,156 |  |  |  | 73,660 |
Intangible assets - net |  | $ | 15,512 |  |  | $ | 18,698 |

Capitalized software represents payroll and development costs incurred for internally developed software. Other intangible assets primarily represent purchased intangibles. Amortization expense for the three months ended June 30, 2025 and 2024 was approximately $2.8 million and $3.2 million, respectively, and for the six months ended June 30, 2025 and 2024 was approximately $5.6 million and $6.6 million, respectively. The weighted-average amortization period is approximately two years.

As of June 30, 2025, future amortization is scheduled to be expensed as follows:

SCHEDULE OF INTANGIBLE ASSETS, FUTURE AMORTIZATION EXPENSE

Years ending December 31, |  | ($ in thousands) |
2025 (six months) |  | $ | 5,303 |
2026 |  |  | 6,672 |
2027 |  |  | 2,475 |
2028 |  |  | 612 |
2029 |  |  | 300 |
Thereafter |  |  | 150 |
Total |  | $ | 15,512 |

6. NET INCOME (LOSS) PER COMMON SHARE

The following table reconciles the weighted-average shares outstanding for basic and diluted net income (loss) per share for the three and six months ended June 30, 2025 and 2024:

SCHEDULE OF RECONCILIATION OF WEIGHTED-AVERAGE SHARES OUTSTANDING FOR BASIC AND DILUTED NET LOSS PER SHARE

|  | 2025 |  |  | 2024 |  |  | 2025 |  |  | 2024 |
|  | Three Months Ended June 30, |  |  | Six Months Ended June 30, |
|  | 2025 |  |  | 2024 |  |  | 2025 |  |  | 2024 |
|  | ($ in thousands, except share and per share amounts) |
Basic and Diluted: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Net income (loss) attributable to common shareholders |  | $ | 1,537 |  |  | $ | (2,249 | ) |  | $ | 674 |  |  | $ | (3,802 | )
Weighted-average common shares used to compute basic and diluted income (loss) per share |  |  | 42,321,629 |  |  |  | 16,132,420 |  |  |  | 33,118,912 |  |  |  | 16,073,364 |
Net income (loss) attributable to common shareholders per share - basic and diluted |  | $ | 0.04 |  |  | $ | (0.14 | ) |  | $ | 0.02 |  |  | $ | (0.24 | )

The net income (loss) attributable to common shareholders includes the preferred stock dividend amounts earned and declared for the three and six months ended June 30, 2025 of approximately $1.4 million and $4.2 million, respectively and the preferred stock dividend amounts earned, but not declared, for the three and six months ended June 30, 2024 of approximately $3.9 million and $5.2 million, respectively. The dividend payable at June 30, 2025 and December 31, 2024 in the condensed consolidated balance sheets represents one month and four months, respectively, of dividends declared, but not paid.

For the three and six months ended June 30, 2024, the 198,212 unvested equity restricted stock units (“RSUs”) as discussed in Note 14, have been excluded from the above calculations as they were anti-dilutive. For the three and six months ended June 30, 2025, the unvested equity RSUs totaling 152,800 were included in the fully diluted net income per share calculation, but it did not have a dilutive effect.

13

7. ACCRUED EXPENSES AND DEBT

Accrued expenses as of June 30, 2025 and December 31, 2024 consist of the following:

SCHEDULE OF ACCRUED EXPENSES

|  | June 30, 2025 |  |  | December 31, 2024 |
|  | ($ in thousands) |
Accrued expenses |  | $ | 3,034 |  |  | $ | 3,528 |
Payable to managed practices |  |  | 1,593 |  |  |  | 1,116 |
Taxes and other |  |  | 282 |  |  |  | 307 |
Total |  | $ | 4,909 |  |  | $ | 4,951 |

Bank Debt —The Company has a revolving line of credit with Silicon Valley Bank, a division of First Citizens Bank & Trust Company (“SVB”). The Company’s credit facility is a secured revolving line of credit where borrowings are based on a formula of 200% of repeatable revenue adjusted by an annualized attrition rate as defined in the credit agreement. During February 2023, the line of credit was increased to $25 million and the term was extended for two additional years maturing on October 12, 2025. The Company is currently in the process of renewing the credit line. The financial covenants were also slightly modified for 2023 and subsequent years. Effective August 31, 2023, the credit facility agreement was amended whereby the interest rate was temporarily increased from the prime rate plus 1.5% to the prime rate plus 2.0% and the requirement for the minimum liquidity ratio was slightly reduced. The amendments expired March 31, 2024 and the credit facility reverted to its previous terms. During October 2024, the credit line was reduced to $10 million at the Company’s request. The current unused borrowing base is approximately $9.5 million at June 30, 2025.

As of June 30, 2025 and December 31, 2024, there were no borrowings under the credit facility. Interest on the revolving line of credit was charged at the prime rate plus 2.0% for the first quarter of 2024, but decreased to the prime rate plus 1.5% on April 1, 2024. There is also a fee of one-half of 1% annually for the unused portion of the credit line. The debt is secured by all of the Company’s domestic assets and 65% of the shares in its offshore subsidiaries. Future acquisitions are subject to approval by SVB. The cost of the line of credit, which is included in interest expense, was approximately $13,000 and $25,000 for the three and six months ended June 30, 2025, respectively. Interest expense on the line of credit was approximately $616,000 and $906,000 for the three and six months ended June 30, 2024, respectively.

The SVB credit agreement contains various covenants and conditions governing the revolving line of credit including a current annual fee of $44,000. These covenants include a minimum level of adjusted EBITDA and a minimum liquidity ratio. At June 30, 2025 and December 31, 2024, the Company was in compliance with all covenants.

The Company maintains cash balances at SVB in excess of the FDIC insurance coverage limits. The Company performs periodic evaluations of the relative credit standing of this financial institution to ensure its credit worthiness. As of June 30, 2025 and December 31, 2024, the Company held cash of approximately $1.2 million and $119,000, respectively, in the name of its subsidiaries at banks in Pakistan and Sri Lanka. The banking systems in these countries do not provide deposit insurance coverage. The Company has not experienced any losses on its cash accounts.

8. LEASES

We determine if an arrangement is a lease at inception. We have operating leases for office and temporary living space as well as for some office equipment. Operating leases are included in operating lease right-of-use (“ROU”) assets, current operating lease liability and non-current operating lease liability in our condensed consolidated balance sheets as of June 30, 2025 and December 31, 2024. The Company does not have any finance leases.

As most of our leases do not provide an implicit rate, we use our estimated incremental borrowing rates, which are derived from information available at the lease commencement date, in determining the present value of lease payments. We give consideration to our bank financing arrangements, geographical location and collateralization of assets when calculating our incremental borrowing rates. We review our incremental borrowing rate on a quarterly basis.

14

Our lease terms include options to extend the lease when we believe that we may want the right to exercise that option. Leases with a term of less than 12 months are not recorded in the condensed consolidated balance sheets. Our lease agreements do not contain any residual value guarantees. For real estate leases, we account for the lease and non-lease components as a single lease component. Some leases include escalation clauses and termination options that are factored in the determination of the lease payments when appropriate. If a lease is modified after the effective date, the operating lease ROU asset and liability are re-measured using the current incremental borrowing rate.

Lease expense is included in direct operating costs, general and administrative expense, selling and marketing expense and research and development expense in the condensed consolidated statements of operations based on the nature of the expense. Our lease terms are determined taking into account lease renewal options, the Company’s anticipated operating plans and leases that are on a month-to-month basis. The Company also has some related party leases – see Note 10.

The components of lease expense were as follows:

SCHEDULE OF LEASE EXPENSE

|  | 2025 |  |  | 2024 |  |  | 2025 |  |  | 2024 |
|  | Three Months Ended June 30, |  |  | Six Months Ended June 30, |
|  | 2025 |  |  | 2024 |  |  | 2025 |  |  | 2024 |
|  | ($ in thousands) |
Operating lease cost |  | $ | 522 |  |  | $ | 620 |  |  | $ | 1,098 |  |  | $ | 1,257 |
Short-term lease cost |  |  | - |  |  |  | - |  |  |  | 5 |  |  |  | 4 |
Variable lease cost |  |  | 4 |  |  |  | 7 |  |  |  | 11 |  |  |  | 12 |
Total - net lease cost |  | $ | 526 |  |  | $ | 627 |  |  | $ | 1,114 |  |  | $ | 1,273 |

Short-term lease cost represents leases that were not capitalized as the lease term as of the later of January 1, 2025 or the beginning of the lease was less than 12 months. Variable lease costs include utilities, real estate taxes and common area maintenance costs.

Supplemental balance sheet information related to leases is as follows:

SCHEDULE OF SUPPLEMENTAL BALANCE SHEET INFORMATION RELATED TO LEASES

|  | June 30, 2025 |  |  | December 31, 2024 |
|  | ($ in thousands) |
Operating leases: |  |  |  |  |  |  |  |
Operating lease ROU assets, net |  | $ | 3,058 |  |  | $ | 3,133 |
Current operating lease liabilities |  | $ | 1,294 |  |  | $ | 1,287 |
Non-current operating lease liabilities |  |  | 1,785 |  |  |  | 1,847 |
Total operating lease liabilities |  | $ | 3,079 |  |  | $ | 3,134 |
Operating leases: |  |  |  |  |  |  |  |
ROU assets |  | $ | 3,964 |  |  | $ | 5,125 |
Asset lease expense |  |  | (901 | ) |  |  | (1,994 | )
Foreign exchange (loss)/gain |  |  | (5 | ) |  |  | 2 |
ROU assets, net |  | $ | 3,058 |  |  | $ | 3,133 |
Operating lease ROU assets, net |  | $ | 3,058 |  |  | $ | 3,133 |
Weighted average remaining lease term (in years): |  |  |  |  |  |  |  |
Operating leases |  |  | 4.8 |  |  |  | 5.0 |
Weighted average discount rate: |  |  |  |  |  |  |  |
Operating leases |  |  | 13.8 | % |  |  | 14.2 | %
Weighted average discount rate operating leases |  |  | 13.8 | % |  |  | 14.2 | %

15

Supplemental cash flow and other information related to leases is as follows:

SCHEDULE OF SUPPLEMENTAL CASH FLOW AND OTHER INFORMATION RELATED TO LEASES

|  | 2025 |  |  | 2024 |  |  | 2025 |  |  | 2024 |
|  | Three Months Ended June 30, |  |  | Six Months Ended June 30, |
|  | 2025 |  |  | 2024 |  |  | 2025 |  |  | 2024 |
|  | ($ in thousands) |
Cash paid for amounts included in the measurement of lease liabilities: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Operating cash flows from operating leases |  | $ | 521 |  |  | $ | 609 |  |  | $ | 1,082 |  |  | $ | 1,277 |
ROU assets obtained in exchange for lease liabilities: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Operating leases, excluding terminations |  | $ | 385 |  |  | $ | 125 |  |  | $ | 831 |  |  | $ | 374 |

Maturities of lease liabilities are as follows:

SCHEDULE OF MATURITIES OF LEASE LIABILITIES

Operating leases - Years ending December 31, |  | ($ in thousands) |
2025 (six months) |  | $ | 1,008 |
2026 |  |  | 968 |
2027 |  |  | 673 |
2028 |  |  | 397 |
2029 |  |  | 195 |
Thereafter |  |  | 1,253 |
Total lease payments |  |  | 4,494 |
Less: imputed interest |  |  | (1,415 | )
Total lease obligations |  |  | 3,079 |
Less: current obligations |  |  | 1,294 |
Long-term lease obligations |  | $ | 1,785 |

The Company leases certain apartments which are subleased to others. The sublease agreements are currently on a month-to-month basis and are considered operating leases. For the three and six months ended June 30, 2025, the Company received approximately $3,000 and $13,000, respectively, in sublease income. For the three and six months ended June 30, 2024, the Company received sublease income of approximately $28,000 and $56,000, respectively.

9. COMMITMENTS AND CONTINGENCIES

Legal Proceedings — On December 22, 2023, an arbitrator rendered a decision in favor of Ramapo Anesthesiologists, PC (“Ramapo”) and granted in part and denied in part certain claims brought against Origin Healthcare Solutions, LLC; Meridian Medical Management, Inc.; and the Company for alleged breach of contract and other allegations. Ramapo was awarded mitigation related costs of $117,000. The payment for this award was made during the first quarter of 2024. The Company’s portion of the settlement was approximately $32,000 and the insurance company paid the balance. The Company’s portion was accrued at December 31, 2023.

A former customer filed a complaint against the Company in New Jersey State Court to recover damages claimed to have been caused by the mishandling of their account. Plaintiff alleged at least approximately $750,000 in damages which was disputed by the Company. The parties participated in a one-day court-ordered, non-binding arbitration. At that time, the arbitrator awarded Plaintiff $288,750 on its contract claims, and awarded the Company $21,698 on its cross-claim for unpaid fees. Plaintiff filed to reject this award. The Company previously filed a partial motion for summary judgment on the alleged punitive damages, but the court denied that motion finding there is an issue of fact as to whether those can be awarded at trial. The Company filed an offer of judgment for $200,000 during April 2024 which was accepted and paid in July.

In connection with a prior acquisition, the seller had alleged that the Company owed approximately $800,000 in transition related costs to them. The parties agreed to settle the claim for approximately $316,000, which was paid in September 2024.

16

A former customer had a dispute with the Company that was based on services before and after the account was acquired in an acquisition. A complaint was filed in Massachusetts State Court, Essex County in February 2018. Under the terms of the purchase agreement, the Company’s liability, if any, was solely and expressly limited to damages related to its handling of the account at issue. The parties participated in formal mediation and at that time, Plaintiff’s starting settlement demand was over $2 million. The mediation was not successful. The Company made an offer of $100,000 in December 2024 to settle the suit, which was accepted. The settlement amount was recorded in accrued expenses at December 31, 2024 in the condensed consolidated balance sheet. A settlement agreement with mutual releases was signed by the parties in January 2025 and payment was made in February 2025.

A dispute occurred with a former customer regarding previous services rendered and they filed a complaint in New York Supreme Court, Onondaga County in January 2024. During settlement communications, Plaintiff’s initial settlement demand was over $2.5 million. During ongoing settlement communications, the Company made an offer of $29,000 in March 2025, which was accepted. A settlement agreement with mutual releases was signed by the parties in May 2025 and payment was made in June 2025.

From time to time, we may become involved in other legal proceedings arising in the ordinary course of our business. We are not presently a party to any legal proceedings that, in the opinion of our management, would individually or taken together have a material adverse effect on our business, consolidated results of operations, financial position or cash flows of the Company.

10. RELATED PARTIES

The Company had sales to a related party, a physician who is the wife of the Executive Chairman. Revenues from this customer were approximately $31,000 and $34,000 for the three months ended June 30, 2025 and 2024, respectively, and approximately $51,000 and $59,000 for the six months ended June 30, 2025 and 2024. As of June 30, 2025 and December 31, 2024, the accounts receivable balance due from this customer was approximately $9,000 and $13,000, respectively, and is included in accounts receivable - net in the condensed consolidated balance sheets.

The Company leases its corporate office in New Jersey, temporary housing for its foreign visitors, a storage facility, its backup operations center in Bagh, Pakistan and an apartment for temporary housing in Dubai, the UAE, from the Executive Chairman. The related party rent expense for the three months ended June 30, 2025 and 2024 was approximately $71,000 and $70,000, respectively, and was approximately $142,000 and $140,000 for the six months ended June 30, 2025 and 2024, respectively, and is included in direct operating costs, general and administrative expense, selling and marketing expense and research and development expense in the condensed consolidated statements of operations. During the six months ended June 30, 2025 and 2024, the Company spent approximately $838,000 and $250,000, respectively, to upgrade the related party leased facilities. Current assets-related party in the condensed consolidated balance sheets includes security deposits related to the leases of the Company’s corporate offices in the amount of approximately $16,000 as of both June 30, 2025 and December 31, 2024. The Company also leases two facilities used for temporary housing from a management employee for approximately $6,700 per month.

Included in the ROU asset at June 30, 2025 is approximately $505,000 applicable to the related party leases. Included in the current and non-current operating lease liability at June 30, 2025 is approximately $215,000 and $287,000, respectively, applicable to the related party leases. Included in the ROU asset at December 31, 2024 is approximately $550,000 applicable to the related party leases. Included in the current and non-current operating lease liability at December 31, 2024 is approximately $181,000 and $367,000, respectively, applicable to the related party leases.

During June 2022, the Company entered into a one-year consulting agreement with an entity owned and controlled by one of its former non-independent directors whereby that director received 10,000 shares of the Company’s 8.75% Series B Cumulative Redeemable Perpetual Preferred Stock (“Series B Preferred Stock”) in exchange for assisting the Company to identify and acquire additional companies, including performing due diligence. In addition, the Company could make additional payments under the agreement for any successful acquisitions by the Company based on the purchase price of the transaction. No such additional payments were made in 2022. During February 2023, the agreement was amended and extended through December 2024 whereby the former director received 14,000 shares of Series B Preferred Stock in February 2023 and received an additional 14,000 shares in January 2024. All of the payments made were capitalized and amortized over the service period. The amortization was recorded as stock compensation in general and administrative expense in the condensed consolidated statement of operations. All such shares of the Series B Preferred Stock were issued in accordance with the Company’s Amended and Restated 2014 Equity Incentive Plan (“Equity Incentive Plan”). In addition to the extension of the consulting agreement, the amendment provided that any transaction fees due will be offset against the last two above payments before any amounts are due to that former director. Effective February 1, 2024, the Company added an additional Statement of Work (“SOW”) to the consulting agreement with the same entity. As compensation for the SOW, the entity received $25,000 per month. The consulting agreement and SOW, through mutual consent, were terminated as of April 30, 2024. There were no transaction fees paid through that date. Effective May 1, 2024, the former non-independent director became President of the Company and effective January 1, 2025 became Co-Chief Executive Officer.

17

Effective January 9, 2024, and as amended February 12, 2024, the Company entered into a consulting agreement with an entity owned and controlled by a member of its Board of Directors to provide investor relations and other services as requested for $8,000 per month (reduced to $2,000 per month effective September 1, 2024 and reduced to an as-needed basis effective January 1, 2025). The agreement was paid at the contractual amount plus amounts for additional services requested, and as of January 1, 2025, is paid on an hourly basis. The consulting agreement is cancelable with ten days’ notice. The expense recorded under this agreement were approximately $3,000 and $32,000 for the three months ended June 30, 2025 and 2024, respectively, and approximately $11,000 and $55,000 for the six months ended June 30, 2025 and 2024.

During 2020, a New Jersey corporation, talkMD Clinicians, PA (“talkMD”), was formed by the wife of the Executive Chairman, who is a licensed physician, to provide telehealth services. talkMD was determined to be a variable interest entity (“VIE”) for financial reporting purposes because the entity will be controlled by the Company. As of June 30, 2025, talkMD had not yet commenced operations. Cumulatively, the Company has paid approximately $6,500 on behalf of talkMD for income taxes.

11. RESTRUCTURING COSTS

In October 2023, the Company committed to effectively align resources with business priorities and improve profitability through a reduction in the workforce for the Healthcare IT segment. The Company identified opportunities for improvements in its workforce realignment, strategy and staffing, and increased its focus on performance management, to ensure it has the right skillsets and number of employees to execute its long-term vision. In addition, the Company instituted certain other expense reductions.

A majority of the impacted employees exited in the fourth quarter of 2023. The Company estimates that it will incur expenses of approximately $1.5 million related to the reduction in workforce of which approximately $606,000 and $645,000 were incurred in 2024 and 2023, respectively, $23,000 and $137,000 was incurred during the three and six months ended June 30, 2025, respectively, with the remaining expenses to be incurred during the remainder of 2025. These restructuring expenses primarily consisted of one-time termination benefits, including, but not limited to, severance payments and healthcare benefits.

The expense associated with the restructuring is included in restructuring costs in the condensed consolidated statement of operations for the three and six months ended June 30, 2025 and 2024. The following table summarizes activity related to liabilities associated with restructuring costs:

SCHEDULE OF LIABILITIES ASSOCIATED WITH RESTRUCTURING COSTS

|  | Severance and separation costs |  |  | Other exit related costs |  |  | Total restructuring and other costs |
|  | ($ in thousands) |
Balance as of January 1, 2025 |  | $ | - |  |  | $ | - |  |  | $ | - |
Additions |  |  | 137 |  |  |  | - |  |  |  | 137 |
Payments and other adjustments |  |  | (137 | ) |  |  | - |  |  |  | (137 | )
Balance as of June 30, 2025 |  | $ | - |  |  | $ | - |  |  | $ | - |
Balance as of January 1, 2024 |  | $ | 145 |  |  | $ | 26 |  |  | $ | 171 |
Beginning balance |  | $ | 145 |  |  | $ | 26 |  |  | $ | 171 |
Additions |  |  | 606 |  |  |  | - |  |  |  | 606 |
Payments and other adjustments |  |  | (751 | ) |  |  | (26 | ) |  |  | (777 | )
Balance as of December 31, 2024 |  | $ | - |  |  | $ | - |  |  | $ | - |
Ending balance |  | $ | - |  |  | $ | - |  |  | $ | - |

18

12. SHAREHOLDERS’ EQUITY

On December 11, 2023, the Board of Directors suspended the monthly cash dividends for the Series A Preferred Stock and Series B Preferred Stock beginning with the payment scheduled for December 15, 2023, together with the remaining dividends that were declared. The suspension of these dividends deferred approximately $1.3 million in cash dividend payments each month.

On September 11, 2024 a Certificate of Amendment (the “Amendment”) to the Certificate of Designations, Preferences and Rights of 11% Series A Cumulative Redeemable Preferred Stock (the “Existing Certificate”) became effective, amending certain provisions of the 11% Series A Cumulative Redeemable Preferred Stock (the “Series A Preferred Stock”). Due to the above Amendment, effective September 12, 2024, the monthly dividends were reduced to approximately $1.1 million per month. The title of the Existing Certificate was amended to read “Amended and Restated Certificate of Designations, Preferences and Rights of 8.75% Series A Cumulative Redeemable Perpetual Preferred Stock.” Holders of Series A Preferred Stock will now receive similar change of control protections to those afforded to holders of the Company’s Series B Preferred Stock. The dividend of Series A Preferred Stock was amended from 11% to 8.75% per annum and the per annum dividend amount per share was amended from $2.75 to $2.1875 per share per annum.

In January 2025, the Company’s common stock shareholders approved an increase in the number of authorized common shares from 35 million to 85 million. An amended certificate of incorporation was filed by the Company.

Also, in January 2025, the Company’s Board of Directors declared the resumption of suspended Preferred Stock dividends beginning with two months of payments. In February 2025, the Company resumed monthly payment of the dividends on the Series A and B Preferred Stock, paying one month of dividends in arrears in both February and March 2025 and applying these amounts to the earliest payments in arrears. The March 2025 payment, which occurred after the conversion as discussed below, included dividends for the shares of Series A Preferred Stock that were not converted and dividends for the Series B Preferred Stock.

On March 6, 2025, the Board of Directors elected to exercise its conversion rights, which provided for the conversion of each share of Series A Preferred Stock into 7.3358 shares of common stock, inclusive of all accumulated and unpaid dividends. Dividends on the converted shares of Series A Preferred Stock ceased to accrue as of the conversion date. Individual shareholders who, on the exchange date, owned at least 100,000 shares of Series A Preferred Stock did not have their shares automatically converted to common stock so long as they were held by the Company’s transfer agent, unless they consented to the Conversion. There were 3,541,701 shares of Series A Preferred Stock converted and 984,530 shares of Series A Preferred Stock outstanding as of June 30, 2025. Due to the Conversion, the monthly cash dividends were reduced to approximately $455,000 per month. As a result of the Conversion, the Company delisted the Series A Preferred Stock from the Nasdaq Global Market.

At June 30, 2025, the Company had total undeclared dividends of approximately $7.1 million, which represents the accumulated (but undeclared) dividends due to preferred shareholders of record on June 30, 2025. Dividends in arrears that have not been declared by the Board of Directors are not recorded in the condensed consolidated balance sheets. Dividends earned during the period are reflected in the condensed consolidated statements of operations, whether or not they were declared.

13. REVENUE

Introduction

The Company accounts for revenue in accordance with ASC 606, Revenue from Contracts with Customers. All revenue is recognized as our performance obligations are satisfied. A performance obligation is a promise in a contract to transfer a distinct good or service to a customer, and is the unit of account under ASC 606. The Company recognizes revenue when the revenue cycle management services begin on the medical billing claims, which is generally upon receipt of the claim from the provider. For many services, the Company recognizes revenue as a percentage of the amount the customer collects on the medical billing claims. The Company’s software is utilized at the time the provider sees the patient, and the Company estimates the value of the consideration it will earn over the remaining contractual period as our services are provided and recognizes the fees over the term; this estimation involves predicting the amounts our clients will ultimately collect associated with the services they provided. Certain significant estimates, such as payment-to-charge ratios, effective billing rates and the estimated contractual payment periods are required to measure revenue cycle management revenue under the standard.

19

Most of our current contracts with customers contain a single performance obligation. For contracts where we provide multiple services, such as where we perform multiple ancillary services, each service represents its own performance obligation. The standalone selling prices are based on the contractual price for the service.

We apply the portfolio approach as permitted by ASC 606 as a practical expedient to contracts with similar characteristics and we use estimates and assumptions when accounting for those portfolios. Our contracts generally include standard commercial payment terms. We have no significant obligations for refunds, warranties or similar obligations and our revenue does not include taxes collected from our customers.

Disaggregation of Revenue from Contracts with Customers

We derive revenue from five primary sources: (1) technology-enabled business solutions, (2) professional services, (3) printing and mailing services, (4) group purchasing services and (5) medical practice management services.

The following table represents a disaggregation of revenue for the three and six months ended June 30, 2025 and 2024:

SCHEDULE OF DISAGGREGATION OF REVENUE

|  | 2025 |  |  | 2024 |  |  | 2025 |  |  | 2024 |
|  | Three Months Ended June 30, |  |  | Six Months Ended June 30, |
|  | 2025 |  |  | 2024 |  |  | 2025 |  |  | 2024 |
|  | ($ in thousands) |
Healthcare IT: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Technology-enabled business solutions |  | $ | 18,991 |  |  | $ | 19,034 |  |  | $ | 36,696 |  |  | $ | 36,317 |
Professional services |  |  | 4,076 |  |  |  | 4,491 |  |  |  | 9,967 |  |  |  | 8,913 |
Printing and mailing services |  |  | 802 |  |  |  | 809 |  |  |  | 1,681 |  |  |  | 1,670 |
Group purchasing services |  |  | 208 |  |  |  | 246 |  |  |  | 375 |  |  |  | 401 |
Medical Practice Management: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Medical practice management services |  |  | 3,300 |  |  |  | 3,510 |  |  |  | 6,290 |  |  |  | 6,751 |
Total |  | $ | 27,377 |  |  | $ | 28,090 |  |  | $ | 55,009 |  |  | $ | 54,052 |
Revenue |  | $ | 27,377 |  |  | $ | 28,090 |  |  | $ | 55,009 |  |  | $ | 54,052 |

Technology-enabled business solutions:

Revenue derived on an on-going basis from our technology-enabled solutions, which typically include revenue cycle management services, is billed as a percentage of payments collected by our customers. The fee for our services often includes the ability to use our electronic health records (“EHR”) and practice management software as well as revenue cycle management (“RCM”) as part of the bundled fee. The Software-as-a-Service (“SaaS”) component is not a material portion of the contract compared to the stand-alone value of RCM.

Technology-assisted revenue cycle management services are the recurring process of submitting and following up on claims with health insurance companies in order for the healthcare providers to receive payment for the services they rendered. The Company typically invoices customers on a monthly basis based on the actual collections received by its customers and the agreed-upon rate in the sales contract. The fee for these services typically includes use of practice management software and related tools (on a SaaS basis), electronic health records (on a SaaS basis), medical billing services and use of mobile health solutions. We consider the services to be one performance obligation since the promises are not distinct in the context of the contract. The performance obligation consists of a series of distinct services that are substantially the same and have the same periodic pattern of transfer to our customers.

In many cases, our clients may terminate their agreements with 90 days’ notice without cause, thereby limiting the term in which we have enforceable rights and obligations, although this time period can vary between clients. Our payment terms are normally net 30 days. Although our contracts typically have stated terms of one or more years, under ASC 606 our contracts are considered month-to-month and accordingly, there is no financing component.

For the majority of our revenue cycle management contracts, the total transaction price is variable because our obligation is to process an unknown quantity of claims, as and when requested by our customers over the contract period. When a contract includes variable consideration, we evaluate the estimate of the variable consideration to determine whether the estimate needs to be constrained; therefore, we include variable consideration in the transaction price only to the extent that it is probable that a significant reversal of the amount of cumulative revenue recognized will not occur when the uncertainty associated with variable consideration is subsequently resolved. Estimates to determine variable consideration such as payment-to-charge ratios, effective billing rates, and the estimated contractual payment periods are updated at each reporting date. Revenue is recognized over the performance period using the input method.

20

Our proprietary, cloud-based practice management application automates the labor-intensive workflow of a medical office in a unified and streamlined SaaS platform. The Company has a large number of clients who utilize the Company’s practice management software, electronic health records software, patient experience management solutions, business intelligence software and/or robotic process automation software on a SaaS basis, but who do not utilize the Company’s revenue cycle management services. SaaS fees may be fixed based on the number of providers, or may be variable.

Our digital health services include chronic care management, where a care manager has remote visits with patients with one or more chronic conditions under the supervision of a physician who is our client. The performance obligation for chronic care management is satisfied at a point in time once the patient receives the remote visit. The digital health services also include remote patient monitoring where our system monitors recordings from FDA approved internet connected devices. These devices record patient trends and alert the physician to changes which might trigger the need for additional follow-up visits. The performance obligations for remote patient monitoring are satisfied over time as the recordings are received and the patient receives the remote visit. The revenue for chronic care management for the three months ended June 30, 2025 and 2024, was approximately $791,000 and $822,000, respectively and for the six months ended June 30, 2025 and 2024, was approximately $1.4 million and $1.3 million, respectively. The revenue for remote patient monitoring for the three months ended June 30, 2025 and 2024, was approximately $199,000 and $210,000, respectively and for the six months ended June 30, 2025 and 2024, was approximately $376,000 and $350,000, respectively.

The medical billing clearinghouse service takes claim information from customers, checks the claims for errors and sends this information electronically to insurance companies. The Company invoices customers on a monthly basis based on the number of claims submitted and the agreed-upon rate in the agreement. This service is provided to medical practices and providers to medical practices who are not revenue cycle management customers. The performance obligation is satisfied once the relevant submissions are completed.

Additional services such as coding and transcription are rendered in connection with the delivery of revenue cycle management and related medical services. The Company invoices customers monthly, based on the actual amount of services performed at the agreed-upon rate in the contract. These services are only offered to revenue cycle management customers. These services do not represent a material right because the services are optional to the customer and customers electing these services are charged the same price for those services as if they were on a standalone basis. Each individual coding or transcription transaction processed represents a performance obligation, which is satisfied over time as that individual service is rendered.

Professional services:

Our professional services include an extensive set of services including EHR vendor-agnostic optimization and activation, project management, IT transformation consulting, process improvement, training, education and staffing for large healthcare organizations including health systems and hospitals. The performance obligation is satisfied over time using the input method. The revenue is recorded on a monthly basis as the professional services are rendered. Unbilled revenue at June 30, 2025 and 2024 was approximately $38,000 and $41,000, respectively.

Printing and mailing services:

The Company provides printing and mailing services for both revenue cycle management customers and a non-revenue cycle management customer, and invoices on a monthly basis based on the number of prints, the agreed-upon rate per print and the postage incurred. The performance obligation is satisfied once the printing and mailing is completed.

21

Group purchasing services:

The Company provides group purchasing services which enable medical providers to purchase various vaccines directly from selected pharmaceutical companies at a discounted price. Currently, there are approximately 4,000 medical providers who are members of the program. Revenue is recognized as the vaccine shipments are made to the medical providers. Fees from the pharmaceutical companies are paid either quarterly or annually and the Company adjusts its revenue accrual at the time of payment. The Company makes significant judgments regarding the variable consideration which we expect to be entitled to for the group purchasing services which includes the anticipated shipments to the members enrolled in the program, anticipated volumes of purchases made by the members, and the changes in the number of members. The amounts recorded are constrained by estimates of decreases in shipments and loss of members to avoid a significant revenue reversal in the subsequent period. The only performance obligation is to provide the pharmaceutical companies with the medical providers who want to become members in order to purchase vaccines. The performance obligation is satisfied once the medical provider agrees to purchase a specific quantity of vaccines and the medical provider’s information is forwarded to the vaccine suppliers. The Company records a contract asset for revenue earned and not paid as the ultimate payment is conditioned on achieving certain volume thresholds.

For all of the above revenue streams other than group purchasing services and chronic care management, revenue is recognized over time, which is typically one month or less, which closely matches the point in time that the customer simultaneously receives and consumes the benefits provided by the Company. For the group purchasing services, revenue is recognized at a point in time. Each service is substantially the same and has the same periodic pattern of transfer to the customer. Each of the services provided above is considered a separate performance obligation.

There were no unsatisfied performance obligations for contracts with an original duration greater than one year. The Company has elected to utilize the practical expedient available with the guidance for contracts with an expected duration of one year or less.

Medical practice management services:

The Company also provides medical practice management services under long-term management service agreements to three medical practices. We provide the medical practices with the nurses, administrative support, facilities, supplies, equipment, marketing, RCM, accounting, and other non-clinical services needed to efficiently operate their practices. Revenue is recognized as the services are provided to the medical practices. Revenue recorded in the condensed consolidated statements of operations represents the reimbursement of costs paid by the Company for the practices and the management fee earned each month for managing the practice. The management fee is based on either a fixed fee or a percentage of the net operating income.

The Company assumes all financial risk for the performance of the managed medical practices. Revenue is impacted by the amount of the costs incurred by the practices and their operating income. The gross billing of the practices is impacted by billing rates, changes in current procedural terminology code reimbursement and collection trends which in turn impacts the management fee that the Company is entitled to. Billing rates are reviewed at least annually and adjusted based on current insurer reimbursement practices. The performance obligation is satisfied as the management services are provided.

Our contracts for medical practice management services have approximately an additional 13 years remaining and are only cancellable under very limited circumstances. The Company receives a management fee each month for managing the day-to-day business operations of each medical group as a fixed fee or a percentage payment of the net operating income which is included in revenue in the condensed consolidated statements of operations.

Our medical practice management services obligations consist of a series of distinct services that are substantially the same and have the same periodic pattern of transfer to our customers. Revenue is recognized over time, however for reporting and convenience purposes, the management fee is computed at each month-end.

Information about contract balances:

As of June 30, 2025, the estimated revenue expected to be recognized in the future related to the remaining revenue cycle management performance obligations outstanding was approximately $3.3 million. We expect to recognize substantially all of the revenue for the remaining performance obligations over the next three months. Approximately $340,000 and $281,000 of the contract asset represents revenue earned, not paid, from the group purchasing services and referral fees, respectively.

22

Amounts that we are entitled to collect under the applicable contract are recorded as accounts receivable. Invoicing is performed at the end of each month when the services have been provided. The contract asset includes our right to payment for services already transferred to a customer when the right to payment is conditional on something other than the passage of time. For example, contracts for revenue cycle management services where we recognize revenue over time but do not have a contractual right to payment until the customer receives payment of their claim from the insurance provider. The contract asset also includes the revenue accrued, not received, for the group purchasing services and referral fees earned.

Changes in the contract asset are recorded as adjustments to net revenue. The changes primarily result from providing services to revenue cycle management customers that result in additional consideration and are offset by our right to payment for services becoming unconditional and changes in the revenue accrued for the group purchasing services. The contract asset for our group purchasing services is reduced when we receive payments from vaccine manufacturers and is increased for revenue earned, not received. The opening and closing balances of the Company’s accounts receivable, contract asset and deferred revenue are as follows:

SCHEDULE OF CHANGES IN ACCOUNTS RECEIVABLE, CONTRACT ASSET AND DEFERRED REVENUE

|  | Accounts Receivable - Net |  |  | Contract Asset |  |  | Deferred Revenue (current) |  |  | Deferred Revenue (long term) |
|  | ($ in thousands) |
Balance as of January 1, 2025 |  | $ | 12,774 |  |  | $ | 4,334 |  |  | $ | 1,212 |  |  | $ | 387 |
Acquisitions |  |  | - |  |  |  | 32 |  |  |  | - |  |  |  | - |
Increase (decrease), net |  |  | 789 |  |  |  | (411 | ) |  |  | 20 |  |  |  | 244 |
Balance as of June 30, 2025 |  | $ | 13,563 |  |  | $ | 3,955 |  |  | $ | 1,232 |  |  | $ | 631 |
Balance as of January 1, 2024 |  | $ | 11,888 |  |  | $ | 5,094 |  |  | $ | 1,380 |  |  | $ | 256 |
Increase (decrease), net |  |  | 1,191 |  |  |  | (294 | ) |  |  | (156 | ) |  |  | 134 |
Balance as of June 30, 2024 |  | $ | 13,079 |  |  | $ | 4,800 |  |  | $ | 1,224 |  |  | $ | 390 |

Deferred commissions:

Our sales incentive plans include commissions payable to employees and third parties at the time of initial contract execution that are capitalized as incremental costs to obtain a contract. The capitalized commissions are amortized over the period the related services are transferred. As we do not offer commissions on contract renewals, we have determined the amortization period to be the estimated client life, which is three years. Deferred commissions were approximately $257,000 and $478,000 at June 30, 2025 and 2024, respectively, and are included in the other assets amounts in the condensed consolidated balance sheets. The amortization of deferred sales commissions during the three months ended June 30, 2025 and 2024 was approximately $65,000 and $83,000, respectively, and approximately $136,000 and $173,000 for the six months ended June 30, 2025 and 2024, respectively.

Trade Accounts Receivable – Estimate of Credit Losses:

ASU 2016-13 requires the recognition of lifetime estimated credit losses expected to occur for trade accounts receivable. The guidance also requires we pool assets with similar risk characteristics and consider current economic conditions when estimating losses. At adoption, we segmented the accounts receivable population into pools based on their risk assessment. Risks related to trade accounts receivable are a customer’s inability to pay or bankruptcy. Each pool was defined by their internal credit assessment and business size. The pools are aligned with management’s review of financial performance. For the three months ended June 30, 2025 and 2024, no adjustment to the pools was necessary.

We utilize a loss-rate method to measure the expected credit loss for each pool. The loss rate is calculated using a three-year lookback period of write-offs and adjustments, divided by the revenue for each pool by aging category, net of customer payments during that period. We consider current and future economic conditions, internal forecasts, customer collection experience and credit memos issued during the current period when assessing loss rates. We reviewed these factors and concluded that no adjustments should be made to the historical loss rate data for the current quarter. In addition, the Company uses specific account identification in determining the total allowance for expected credit losses. Trade receivables are written off only after the Company has exhausted all collection efforts.

23

Changes in the allowance for expected credit losses for trade accounts receivable are presented in the table below:

SCHEDULE OF TRADE ALLOWANCE FOR DOUBTFUL ACCOUNTS

|  | Six Months Ended |  |  | Year Ended |
|  | June 30, 2025 |  |  | December 31, 2024 |
|  | ($ in thousands) |
Beginning balance |  | $ | 837 |  |  | $ | 879 |
Provision |  |  | 169 |  |  |  | 334 |
Recoveries/adjustments |  |  | - |  |  |  | 2 |
Write-offs |  |  | (131 | ) |  |  | (378 | )
Ending balance |  | $ | 875 |  |  | $ | 837 |

14. STOCK-BASED COMPENSATION

As of June 30, 2025, 499,683 shares of common stock and 16,000 shares of Series B Preferred Stock are available for grant under the Equity Incentive Plan. Permissible awards include incentive stock options, non-statutory stock options, stock appreciation rights, restricted stock, RSUs, performance stock and cash-settled awards and other stock-based awards in the discretion of the Compensation Committee of the Board of Directors including unrestricted stock grants.

Certain equity-based RSU agreements contain a provision in which the units shall immediately vest and become converted into common shares at the rate of one share per RSU, immediately after a change in control, as defined in the award agreement.

Common and preferred stock RSUs

In February 2023, the Compensation Committee approved executive bonuses to be paid in shares of Series B Preferred Stock, with the number of shares and the amount based on specified criteria being achieved during the year 2023. During October 2023, the Compensation Committee approved the issuance of 10,000 of the above shares to one of the executives who retired. The remaining 24,000 shares were forfeited in 2024.

In March 2024, the Compensation Committee approved executive bonuses to be paid in shares of Series B Preferred Stock with the number of RSUs granted based on employment agreements and the amount vested based on specified criteria being achieved during the year 2024. There were 34,000 RSUs granted. During May 2024, an additional executive bonus with similar terms was approved and 12,000 shares were awarded. During December 2024, the Compensation Committee approved the award of these shares based on achievement of the specified criteria. For the three and six months ended June 30, 2025, an expense of approximately $111,000 and $219,000, respectively, was recorded. For the three and six months ended June 30, 2024, an expense of approximately $265,000 and a net benefit of approximately $443,000, respectively, was recorded. Stock compensation expense recorded is based on the value of the shares at the grant date and recognized over the service period. The portion of the stock compensation expense to be used for the payment of withholding and payroll taxes is included in accrued compensation in the condensed consolidated balance sheets. The balance of the stock compensation expense has been recorded as additional paid-in capital.

24

The following table summarizes the RSU transactions related to the common and preferred stock under the Company’s Equity Incentive Plan for the six months ended June 30, 2025 and 2024:

SCHEDULE OF SHARE-BASED COMPENSATION ARRANGEMENTS BY SHARE-BASED PAYMENT AWARD

|  | Common Stock |  |  | Series A Preferred Stock |  |  | Series B Preferred Stock |
Outstanding and unvested shares at January 1, 2025 |  |  | 242,500 |  |  |  | - |  |  |  | 19,199 |
Granted |  |  | - |  |  |  | - |  |  |  | - |
Vested |  |  | (89,700 | ) |  |  | - |  |  |  | - |
Forfeited |  |  | - |  |  |  | - |  |  |  | - |
Outstanding and unvested shares at June 30, 2025 |  |  | 152,800 |  |  |  | - |  |  |  | 19,199 |
Outstanding and unvested shares at January 1, 2024 |  |  | 753,495 |  |  |  | - |  |  |  | 57,199 |
Granted |  |  | 50,000 |  |  |  | - |  |  |  | 46,000 |
Vested |  |  | (366,214 | ) |  |  | - |  |  |  | (14,000 | )
Forfeited |  |  | (224,032 | ) |  |  | - |  |  |  | (24,000 | )
Outstanding and unvested shares at June 30, 2024 |  |  | 213,249 |  |  |  | - |  |  |  | 65,199 |

At June 30, 2025 there was no liability for taxes withheld in connection with the equity awards. There was a liability for taxes withheld in connection with the equity awards of approximately $6,000 at December 31, 2024 and is included in accrued compensation in the condensed consolidated balance sheet. No amounts were paid in connection with cash-settled awards during the three and six months ended June 30, 2025 and 2024.

Stock-based compensation expense (benefit)

The following table summarizes the components of share-based compensation expense (benefit) for the three and six months ended June 30, 2025 and 2024:

SCHEDULE OF EMPLOYEE SERVICE SHARE-BASED COMPENSATION, ALLOCATION OF RECOGNIZED PERIOD COSTS

|  | Three Months Ended June 30, |  |  | Six Months Ended June 30, |
|  | 2025 |  |  | 2024 |  |  | 2025 |  |  | 2024 |
|  | ($ in thousands) |
Direct operating costs |  | $ | - |  |  | $ | 2 |  |  | $ | - |  |  | $ | (43 | )
General and administrative |  |  | 111 |  |  |  | 268 |  |  |  | 216 |  |  |  | (428 | )
Research and development |  |  | - |  |  |  | (68 | ) |  |  | 3 |  |  |  | (14 | )
Selling and marketing |  |  | - |  |  |  | 63 |  |  |  | - |  |  |  | 42 |
Total stock-based compensation expense (benefit) |  | $ | 111 |  |  | $ | 265 |  |  | $ | 219 |  |  | $ | (443 | )

15. INCOME TAXES

The income tax expense for the three months ended June 30, 2025 was approximately $42,000 comprised of current state tax expense of $30,000 and foreign tax expense of $12,000. The income tax expense for the six months ended June 30, 2025 was approximately $83,000 comprised of current state tax expense of $60,000 and foreign tax expense of $23,000. There was no deferred income tax for the three and six months ended June 30, 2025.

The income tax expense for the three months ended June 30, 2024 was approximately $39,000 comprised of a current tax expense of $30,000 and a foreign tax expense of $9,000. The income tax expense for the six months ended June 30, 2024 was approximately $78,000 comprised of a current tax expense of $60,000 and foreign tax expense of $18,000. There was no deferred income tax for the three and six months ended June 30, 2024.

The current income tax provision for the three and six months ended June 30, 2025 and 2024 primarily relates to state minimum taxes and foreign income taxes. To the extent allowable, prior to January 1, 2024, the federal and state deferred tax provision had been offset by the indefinite life net operating loss. As a result of the goodwill impairment charge recorded for the year ended December 31, 2023, no deferred tax liability is currently required.

The Company previously incurred losses, which make realization of a deferred tax asset difficult to support in accordance with ASC 740. Accordingly, a valuation allowance has been recorded against the federal and state deferred tax assets as of June 30, 2025 and December 31, 2024.

25

On July 4, 2025, the One Big Beautiful Bill Act (“OBBBA”) was signed into law, extending key provisions of the 2017 Tax Cuts and Jobs Act including, but not limited to, federal bonus depreciation and deductions for domestic research and development expenditures. The Company is currently evaluating OBBBA, however, it is not expected to have a material impact on the Company’s consolidated financial statements.

16. FAIR VALUE OF FINANCIAL INSTRUMENTS

Fair value measurements are based upon observable and unobservable inputs. Observable inputs reflect market data obtained from independent sources, while unobservable inputs reflect our view of market participant assumptions in the absence of observable market information. We utilize valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs. The fair values of assets and liabilities required to be measured at fair value are categorized based upon the level of judgement associated with the inputs used to measure their value in one of the following three categories:

Level 1: Inputs are unadjusted quoted prices in active markets for identical assets or liabilities. We held no Level 1 financial instruments at June 30, 2025 or December 31, 2024.

Level 2: Quoted prices for similar instruments in active markets with inputs that are observable, either directly or indirectly. Our Level 2 financial instruments include notes payable which are carried at cost and approximate fair value since the interest rates being charged approximate market rates.

Level 3: Unobservable inputs are significant to the fair value of the asset or liability, and include situations where there is little, if any, market activity for the asset or liability. Our Level 3 instruments include the fair value of contingent consideration related to completed acquisitions. The fair value at June 30, 2025 is based on a discounted cash flow analysis reflecting the likelihood of achieving specified performance measure or events and captures the contractual nature of the contingencies, the passage of time and the associated discount rate. There was no contingent consideration recorded at December 31, 2024.

The following table provides a reconciliation of the beginning and ending balances for the contingent consideration measured at fair value using significant unobservable inputs (Level 3):

FAIR VALUE OF THE ASSETS MEASURED ON A NON-RECURRING BASIS

|  | 2025 |  |  | 2024 |
|  | Fair Value Measurement at Reporting Date Using Significant Unobservable Inputs, Level 3 |
|  | Six Months Ended June 30, |
|  | 2025 |  |  | 2024 |
|  | ($ in thousands) |
Balance - January 1, |  | $ | - |  |  | $ | - |
Acquisitions |  |  | 756 |  |  |  | - |
Change in fair value |  |  | - |  |  |  | - |
Payments |  |  | - |  |  |  | - |
Balance - June 30, |  | $ | 756 |  |  | $ | - |

17. SEGMENT REPORTING

From January 1, 2023 through April 30, 2024, the Chief Executive Officer (“CEO”) and Executive Chairman served as the Chief Decision Maker (“CODM”), organizing the Company, managing resource allocations and measuring performance among two operating and reportable segments: (i) Healthcare IT and (ii) Medical Practice Management. As of May 1, 2024, the Company’s President, CEO and Executive Chairman served as the CODM. Effective January 1, 2025, the Executive Chairman and the two Co-CEOs serve as the CODM. We report our segment information based on the internal reporting used by management for making decisions and assessing performance as the source of our reportable segments.

The CODM evaluates the financial performance of the business units on the basis of revenue, certain individual and total operating expenses and operating income (loss) excluding unallocated amounts, which are mainly corporate overhead costs, for assessing operating results and the allocation of resources. Our CODM does not evaluate operating segments using asset or liability information. The CODM uses segment revenue, certain segment operating expenses and segment operating income (loss) to manage the segments, comparing actual results to forecasted amounts and investigating the reasons for significant variances. Currently, a focus is being placed on reducing costs and managing global headcount. The segment revenue and segment operating income (loss) is also used to assess the performance of personnel and in establishing their compensation.

26

The Healthcare IT segment includes revenue cycle management, SaaS solutions and other services. The Medical Practice Management segment includes the management of three medical practices. Each segment is considered a reporting unit. The CODM evaluates the financial performance of the business units on the basis of revenue and direct operating costs excluding unallocated amounts that are mainly corporate overhead costs. Our CODM does not evaluate operating segments using asset or liability information. The accounting policies of the segments are the same as those disclosed in the Company’s Annual Report on Form 10-K/A for the year ended December 31, 2024 filed with the SEC on April 3, 2025. The following table presents revenues, operating expenses and operating income (loss) by reportable segment:

SCHEDULE OF REVENUES, OPERATING EXPENSES AND OPERATING INCOME (LOSS) BY REPORTABLE SEGMENT

|  | Healthcare IT |  |  | Medical Practice Management |  |  | Total |
|  | Six Months Ended June 30, 2025 |
|  | ($ in thousands) |
|  | Healthcare IT |  |  | Medical Practice Management |  |  | Total |
Net revenue |  | $ | 48,719 |  |  | $ | 6,290 | (a) |  | $ | 55,009 |
Operating expenses: |  |  |  |  |  |  |  |  |  |  |  |
Direct operating costs |  |  | 24,666 |  |  |  | 5,278 |  |  |  | 29,944 |
Selling and marketing |  |  | 2,234 |  |  |  | 15 |  |  |  | 2,249 |
General and administrative |  |  | 4,455 |  |  |  | 1,211 |  |  |  | 5,666 |
Research and development |  |  | 2,255 |  |  |  | - |  |  |  | 2,255 |
Depreciation and amortization |  |  | 6,555 |  |  |  | 164 |  |  |  | 6,719 |
Restructuring costs |  |  | 137 |  |  |  | - |  |  |  | 137 |
Total operating expenses |  |  | 40,302 |  |  |  | 6,668 |  |  |  | 46,970 |
Segment operating income (loss) |  | $ | 8,417 |  |  | $ | (378 | ) |  | $ | 8,039 |
Reconciliation of profit or loss (segment profit/loss): |  |  |  |  |  |  |  |  |  |  |  |
Unallocated corporate expenses |  |  |  |  |  |  |  |  |  | $ | (3,024 | )
Net interest expense |  |  |  |  |  |  |  |  |  |  | (33 | )
Other expenses |  |  |  |  |  |  |  |  |  |  | (49 | )
Income before income taxes |  |  |  |  |  |  |  |  |  | $ | 4,933 |

(a) This revenue represents fees based on our actual costs plus a percentage of the operating profit.

|  | Healthcare IT |  |  | Medical Practice Management |  |  | Total |
|  | Three Months Ended June 30, 2025 |
|  | ($ in thousands) |
|  | Healthcare IT |  |  | Medical Practice Management |  |  | Total |
Net revenue |  | $ | 24,077 |  |  | $ | 3,300 | (a) |  | $ | 27,377 |
Operating expenses: |  |  |  |  |  |  |  |  |  |  |  |
Direct operating costs |  |  | 11,763 |  |  |  | 2,717 |  |  |  | 14,480 |
Selling and marketing |  |  | 1,110 |  |  |  | 8 |  |  |  | 1,118 |
General and administrative |  |  | 2,343 |  |  |  | 569 |  |  |  | 2,912 |
Research and development |  |  | 1,020 |  |  |  | - |  |  |  | 1,020 |
Depreciation and amortization |  |  | 3,300 |  |  |  | 82 |  |  |  | 3,382 |
Restructuring costs |  |  | 23 |  |  |  | - |  |  |  | 23 |
Total operating expenses |  |  | 19,559 |  |  |  | 3,376 |  |  |  | 22,935 |
Segment operating income (loss) |  | $ | 4,518 |  |  | $ | (76 | ) |  | $ | 4,442 |
Reconciliation of profit or loss (segment profit/loss) |  |  |  |  |  |  |  |  |  |  |  |
Unallocated corporate expenses |  |  |  |  |  |  |  |  |  |  | (1,446 | )
Interest expense |  |  |  |  |  |  |  |  |  |  | (17 | )
Other expenses |  |  |  |  |  |  |  |  |  |  | (35 | )
Income before income taxes |  |  |  |  |  |  |  |  |  | $ | 2,944 |

(a) This revenue represents fees based on our actual costs plus a percentage of the operating profit.

27

|  | Healthcare IT |  |  | Medical Practice Management |  |  | Total |
|  | Six Months Ended June 30, 2024 |
|  | ($ in thousands) |
|  | Healthcare IT |  |  | Medical Practice Management |  |  | Total |
Net revenue |  | $ | 47,301 |  |  | $ | 6,751 | (a) |  | $ | 54,052 |
Operating expenses: |  |  |  |  |  |  |  |  |  |  |  |
Direct operating costs |  |  | 25,254 |  |  |  | 5,165 |  |  |  | 30,419 |
Selling and marketing |  |  | 3,417 |  |  |  | 17 |  |  |  | 3,434 |
General and administrative |  |  | 4,602 |  |  |  | 911 |  |  |  | 5,513 |
Research and development |  |  | 1,968 |  |  |  | - |  |  |  | 1,968 |
Depreciation and amortization |  |  | 7,478 |  |  |  | 166 |  |  |  | 7,644 |
Restructuring costs |  |  | 438 |  |  |  | - |  |  |  | 438 |
Total operating expenses |  |  | 43,157 |  |  |  | 6,259 |  |  |  | 49,416 |
Segment operating income |  | $ | 4,144 |  |  | $ | 492 |  |  | $ | 4,636 |
Reconciliation of profit or loss (segment profit/loss): |  |  |  |  |  |  |  |  |  |  |  |
Unallocated corporate expenses |  |  |  |  |  |  |  |  |  | $ | (2,236 | )
Net interest expense |  |  |  |  |  |  |  |  |  |  | (602 | )
Other income |  |  |  |  |  |  |  |  |  |  | (287 | )
Income before income taxes |  |  |  |  |  |  |  |  |  | $ | 1,511 |

(a) This revenue represents fees based on our actual costs plus a percentage of the operating profit.

|  | Healthcare IT |  |  | Medical Practice Management |  |  | Total |
|  | Three Months Ended June 30, 2024 |
|  | ($ in thousands) |
|  | Healthcare IT |  |  | Medical Practice Management |  |  | Total |
Net revenue |  | $ | 24,580 |  |  | $ | 3,510 | (a) |  | $ | 28,090 |
Operating expenses: |  |  |  |  |  |  |  |  |  |  |  |
Direct operating costs |  |  | 12,710 |  |  |  | 2,532 |  |  |  | 15,242 |
Selling and marketing |  |  | 1,657 |  |  |  | 7 |  |  |  | 1,664 |
General and administrative |  |  | 2,021 |  |  |  | 477 |  |  |  | 2,498 |
Research and development |  |  | 1,055 |  |  |  | - |  |  |  | 1,055 |
Depreciation and amortization |  |  | 3,633 |  |  |  | 81 |  |  |  | 3,714 |
Restructuring costs |  |  | 116 |  |  |  | - |  |  |  | 116 |
Restructuring costs |  |  | 116 |  |  |  | - |  |  |  | 116 |
Total operating expenses |  |  | 21,192 |  |  |  | 3,097 |  |  |  | 24,289 |
Segment operating income |  | $ | 3,388 |  |  | $ | 413 |  |  | $ | 3,801 |
Reconciliation of profit or loss (segment profit/loss) |  |  |  |  |  |  |  |  |  |  |  |
Unallocated corporate expenses |  |  |  |  |  |  |  |  |  |  | (1,530 | )
Interest expense |  |  |  |  |  |  |  |  |  |  | (264 | )
Other expenses |  |  |  |  |  |  |  |  |  |  | (294 | )
Income before income taxes |  |  |  |  |  |  |  |  |  | $ | 1,713 |

(a) | This revenue represents fees based on our actual costs plus a percentage of the operating profit.

28

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following is a discussion of our condensed consolidated financial condition and results of operations for the three and six months ended June 30, 2025 and 2024, and other factors that are expected to affect our prospective financial condition. The following discussion and analysis should be read together with our Condensed Consolidated Financial Statements and related notes beginning on page 4 of this Quarterly Report on Form 10-Q and our Annual Report on Form 10-K/A for the year ended December 31, 2024, filed with the SEC on April 3, 2025.

Some of the statements set forth in this section are forward-looking statements relating to our future results of operations. Our actual results may vary from the results anticipated by these statements. Please see “Forward-Looking Statements” on page 2 of this Quarterly Report on Form 10-Q.

Financial Risks

The Company maintains cash balances at Silicon Valley Bank (“SVB”), a division of First Citizens Bank & Trust Company in excess of the FDIC insurance coverage limits. The Company performs periodic evaluations of the relative credit standing of this financial institution to ensure its credit worthiness. As of June 30, 2025 and December 31, 2024, the Company held cash of approximately $1.2 million and $119,000, respectively, in the name of its subsidiaries at banks in Pakistan and Sri Lanka. The banking systems in these countries do not provide deposit insurance coverage. The Company has not experienced any losses on its cash accounts.

Overview

The Company is a healthcare information technology company that provides technology-enabled revenue cycle management and a full suite of proprietary cloud-based solutions to healthcare providers, from small practices to enterprise medical groups, hospitals, and health systems throughout the United States. Our integrated Software-as-a-Service (“SaaS”) platform includes revenue cycle management (“RCM”), practice management (“PM”), electronic health records (“EHR”), business intelligence, telehealth, patient experience management (“PXM”) solutions and complementary software tools and business services for high-performance medical groups and health systems. The Company also offers printing and mailing and group purchasing services.

Our technology-enabled business solutions can be categorized as follows:

| ● | Technology-enabled revenue cycle management:

| ○ | Revenue Cycle Management services including end-to-end medical billing, eligibility, analytics, and related services, all of which can be provided utilizing our technology platform and robotic process automation tools or leveraging a third-party system;
| ○ | Medical coding and credentialing services to improve provider collections, back-end cost containment, and drive total revenue realization for our healthcare clients; and
| ○ | Healthcare claims clearinghouse which enables our clients to electronically scrub and submit claims and process payments from insurance companies.

| ● | Cloud-based software:

| ○ | Electronic Health Records, which are easy to use and sometimes integrated with our business services, and enable our healthcare provider clients to deliver better patient care, streamline their clinical workflows, decrease documentation errors, and potentially qualify for government incentives;
| ○ | Practice Management software and related capabilities, which support our clients’ day-to-day business operations and financial workflows, including automated insurance eligibility software, a robust billing and claims rules engine, and other automated tools designed to maximize reimbursement;
| ○ | Artificial intelligence (“AI”):

| ● | CareCloud cirrusAI is designed to serve as a digital healthcare assistant, helping to enhance clinical decision-making, streamline workflows, reduce administrative burdens, optimize revenue management, and promote patient-centered care. The functions include:

29

| ● | AI-Powered Ambient Listening: cirrusAI Notes seamlessly captures natural patient-provider conversations in the exam room in real-time, automatically generating and integrating clinical encounter documentation directly into the EHR. Powered by cutting-edge Healthcare Generative AI, it alleviates documentation burdens, saving providers 20% more time per day to focus on delivering exceptional patient care.
| ● | AI-Powered Call Auditing: cirrusAI Voice listens to recorded calls in healthcare facilities, evaluates agents’ performance against pre-defined KPIs, and assigns scores to each agent. With detailed insights into agent performance, healthcare managers can identify strengths and areas for improvement, enabling targeted training and development. By ensuring higher-quality interactions, this service empowers healthcare call centers to deliver superior patient care, enhance operational efficiency, and drive continuous improvement in service delivery.
| ● | AI-Powered Clinical Decision Support: CareCloud cirrusAI Guide automates clinical data input, and assists clinicians in workflow tasks, providing real-time, evidence-based recommendations and personalized suggestions via Vertex AI’s generative AI tools for providers to consider. This innovation can lead to enhanced diagnosis accuracy and treatment planning.
| ● | AI-Powered Virtual Support Assistant: CareCloud cirrusAI Chat facilitates natural language conversations with practice staff members, offering valuable assistance in navigating CareCloud Electronic Health Records workflows. This tool streamlines post-training and onboarding for new staff, reducing response times and providing real-time assistance, ultimately saving time.
| ● | AI-Driven Appeals: CareCloud cirrusAI Appeals generates customized appeal letters by analyzing patient claim details, the appeal’s reason, and the specific payor involved for healthcare workers to review, edit, and send. This functionality supports CareCloud’s RCM teams in optimizing providers’ RCM and securing proper reimbursement.

| ● | CareCloud cirrusAI integrates with CareCloud’s EHR solutions, talkEHR and CareCloud Charts, making it easily accessible to providers of all sizes.

| ○ | Patient Experience Management solutions designed to transform interactions between patients and their clinicians, including smartphone applications that assist patients and healthcare providers in the provision of healthcare services, contactless digital check-in solutions, messaging, and online appointment scheduling tools;
| ○ | Business Intelligence (“BI”) and healthcare analytics platforms that allow our clients to derive actionable insights from their vast amount of data; and
| ○ | Customized applications, interfaces, and a variety of other technology solutions that support our healthcare clients.

| ● | Digital health:

| ○ | Chronic care management is a program that supports care for patients with chronic conditions by certified care managers that operate under the supervision of the patient’s regular physician;
| ○ | Remote patient monitoring enables patient data collected outside the clinical setting through remote devices to be fed into their provider’s EHR to enable proactive patient care; and
| ○ | Telemedicine solutions which allow healthcare providers to conduct remote patient visits and extend the timely delivery of care to patients unable to travel to a provider’s office.

| ● | Healthcare IT professional services & staffing:

| ○ | Professional services consisting of a broad range of consulting services including full software implementations and activation, revenue cycle optimization, data analytic services, and educational training services;
| ○ | Strategic advisory services to manage system evaluations and selection, provide interim management, and operational assessments; and
| ○ | Workforce augmentation and on-demand staffing to support our clients as they expand their businesses, seek highly trained personnel, or struggle to address staffing shortages.

Our medical practice management solutions include:

| ● | Medical practice management:

| ○ | Medical practice management services for medical providers, including facilities, equipment, supplies, support services, nurses, and administrative support staff.

We are able to deliver our industry-leading solutions at very competitive prices because we leverage a combination of our proprietary software, which automates our workflows and increases efficiency, together with our team of approximately 300 experienced health industry experts throughout the United States. These experts are supported by our highly educated and specialized offshore workforce of approximately 3,600 team members that are approximately 18% of the cost of comparably educated and skilled workers in the U.S. Our unique business model also allowed us to become a leading consolidator in our industry sector, gaining us a reputation for acquiring and positively transforming distressed competitors into profitable operations of CareCloud.

30

Our offshore operations in the Pakistan Offices and Sri Lanka together accounted for approximately 18% and 14% of total expenses for the six months ended June 30, 2025 and 2024, respectively. A significant portion of those foreign expenses were personnel-related costs (approximately 77% and 76% for the six months ended June 30, 2025 and 2024, respectively). Because personnel-related costs are significantly lower in Pakistan and Sri Lanka than in the U.S. and many other offshore locations, we believe our offshore operations give us a competitive advantage over many industry participants. We are able to achieve significant cost reductions and leverage technology to reduce manual work and strategically transition a portion of the remaining manual tasks to our highly-specialized, cost-efficient team in the U.S., the Pakistan Offices and Sri Lanka.

Key Performance Measures

We consider numerous factors in assessing our performance. Key performance measures used by management, including adjusted EBITDA, adjusted operating income, adjusted operating margin, adjusted net income and adjusted net income per share, are non-GAAP financial measures, which we believe better enable management and investors to analyze and compare the underlying business results from period to period.

These non-GAAP financial measures should not be considered in isolation, or as a substitute for or superior to, financial measures calculated in accordance with accounting principles generally accepted in the United States of America (“GAAP”). Moreover, these non-GAAP financial measures have limitations in that they do not reflect all the items associated with the operations of our business as determined in accordance with GAAP. We compensate for these limitations by analyzing current and future results on a GAAP basis as well as a non-GAAP basis, and we provide reconciliations from the most directly comparable GAAP financial measures to the non-GAAP financial measures. Our non-GAAP financial measures may not be comparable to similarly titled measures of other companies. Other companies, including companies in our industry, may calculate similarly titled non-GAAP financial measures differently than we do, limiting the usefulness of those measures for comparative purposes.

Adjusted EBITDA, adjusted operating income, adjusted operating margin, adjusted net income and adjusted net income per share provide an alternative view of performance used by management and we believe that an investor’s understanding of our performance is enhanced by disclosing these adjusted performance measures.

Adjusted EBITDA excludes the following elements which are included in GAAP net income:

| ● | Income tax provision or the cash requirements to pay our taxes;
| ● | Interest expense, or the cash requirements necessary to service interest on principal payments, on our debt;
| ● | Foreign currency gains and losses and other non-operating expenditures;
| ● | Stock-based compensation expense (benefit) which includes cash-settled awards and the related taxes;
| ● | Depreciation and amortization charges;
| ● | Integration costs, such as severance amounts paid to employees from acquired businesses, and transaction costs, such as brokerage fees, pre-acquisition accounting costs and legal fees and exit costs related to contractual agreements; and
| ● | Restructuring costs.

31

Set forth below is a presentation of our adjusted EBITDA for the three and six months ended June 30, 2025 and 2024:

|  | Three Months Ended June 30, |  |  | Six Months Ended June 30, |
|  | 2025 |  |  | 2024 |  |  | 2025 |  |  | 2024 |
|  | ($ in thousands) |
Net revenue |  | $ | 27,377 |  |  | $ | 28,090 |  |  | $ | 55,009 |  |  | $ | 54,052 |
GAAP net income |  |  | 2,902 |  |  |  | 1,674 |  |  |  | 4,850 |  |  |  | 1,433 |
Provision for income taxes |  |  | 42 |  |  |  | 39 |  |  |  | 83 |  |  |  | 78 |
Net interest expense |  |  | 17 |  |  |  | 264 |  |  |  | 33 |  |  |  | 602 |
Foreign exchange loss / other expense |  |  | 41 |  |  |  | 306 |  |  |  | 60 |  |  |  | 301 |
Stock-based compensation expense (benefit) |  |  | 111 |  |  |  | 265 |  |  |  | 219 |  |  |  | (443 | )
Depreciation and amortization |  |  | 3,382 |  |  |  | 3,714 |  |  |  | 6,719 |  |  |  | 7,644 |
Transaction and integration costs |  |  | 11 |  |  |  | 11 |  |  |  | 23 |  |  |  | 23 |
Restructuring costs |  |  | 23 |  |  |  | 116 |  |  |  | 137 |  |  |  | 438 |
Adjusted EBITDA |  | $ | 6,529 |  |  | $ | 6,389 |  |  | $ | 12,124 |  |  | $ | 10,076 |

Adjusted operating income and adjusted operating margin exclude the following elements that are included in GAAP operating income:

| ● | Stock-based compensation expense (benefit) which includes cash-settled awards and the related taxes;
| ● | Amortization of purchased intangible assets;
| ● | Integration costs, such as severance amounts paid to employees from acquired businesses, and transaction costs, such as brokerage fees, pre-acquisition accounting costs and legal fees and exit costs related to contractual agreements; and
| ● | Restructuring costs.

Set forth below is a presentation of our adjusted operating income and adjusted operating margin, which represents adjusted operating income as a percentage of net revenue for the three and six months ended June 30, 2025 and 2024:

|  | Three Months Ended June 30, |  |  | Six Months Ended June 30, |
|  | 2025 |  |  | 2024 |  |  | 2025 |  |  | 2024 |
|  | ($ in thousands) |
Net revenue |  | $ | 27,377 |  |  | $ | 28,090 |  |  | $ | 55,009 |  |  | $ | 54,052 |
GAAP net income |  |  | 2,902 |  |  |  | 1,674 |  |  |  | 4,850 |  |  |  | 1,433 |
Provision for income taxes |  |  | 42 |  |  |  | 39 |  |  |  | 83 |  |  |  | 78 |
Net interest expense |  |  | 17 |  |  |  | 264 |  |  |  | 33 |  |  |  | 602 |
Other expense - net |  |  | 35 |  |  |  | 294 |  |  |  | 49 |  |  |  | 287 |
GAAP operating income |  |  | 2,996 |  |  |  | 2,271 |  |  |  | 5,015 |  |  |  | 2,400 |
GAAP operating margin |  |  | 10.9 | % |  |  | 8.1 | % |  |  | 9.1 | % |  |  | 4.4 | %
Stock-based compensation expense (benefit) |  |  | 111 |  |  |  | 265 |  |  |  | 219 |  |  |  | (443 | )
Amortization of purchased intangible assets |  |  | 193 |  |  |  | 586 |  |  |  | 282 |  |  |  | 1,426 |
Transaction and integration costs |  |  | 11 |  |  |  | 11 |  |  |  | 23 |  |  |  | 23 |
Restructuring costs |  |  | 23 |  |  |  | 116 |  |  |  | 137 |  |  |  | 438 |
Non-GAAP adjusted operating income |  | $ | 3,334 |  |  | $ | 3,249 |  |  | $ | 5,676 |  |  | $ | 3,844 |
Non-GAAP adjusted operating margin |  |  | 12.2 | % |  |  | 11.6 | % |  |  | 10.3 | % |  |  | 7.1 | %

Adjusted net income and adjusted net income per share exclude the following elements which are included in GAAP net income:

| ● | Foreign currency gains and losses and other non-operating expenditures;

| ● | Stock-based compensation expense (benefit) which includes cash-settled awards and the related taxes;

| ● | Amortization of purchased intangible assets;

| ● | Integration costs, such as severance amounts paid to employees from acquired businesses, and transaction costs, such as brokerage fees, pre-acquisition accounting costs and legal fees and exit costs related to contractual agreements; and

| ● | Restructuring costs.

32

No tax effect has been provided in computing non-GAAP adjusted net income and non-GAAP adjusted net income per share as the Company has sufficient carry forward net operating losses to offset the applicable income taxes. The following table shows our reconciliation of GAAP net income to non-GAAP adjusted net income for the three and six months ended June 30, 2025 and 2024:

|  | Three Months Ended June 30, |  |  | Six Months Ended June 30, |
|  | 2025 |  |  | 2024 |  |  | 2025 |  |  | 2024 |
|  | ($ in thousands) |
GAAP net income |  | $ | 2,902 |  |  | $ | 1,674 |  |  | $ | 4,850 |  |  | $ | 1,433 |
Foreign exchange loss / other expense |  |  | 41 |  |  |  | 306 |  |  |  | 60 |  |  |  | 301 |
Stock-based compensation expense (benefit) |  |  | 111 |  |  |  | 265 |  |  |  | 219 |  |  |  | (443 | )
Amortization of purchased intangible assets |  |  | 193 |  |  |  | 586 |  |  |  | 282 |  |  |  | 1,426 |
Transaction and integration costs |  |  | 11 |  |  |  | 11 |  |  |  | 23 |  |  |  | 23 |
Restructuring costs |  |  | 23 |  |  |  | 116 |  |  |  | 137 |  |  |  | 438 |
Non-GAAP adjusted net income |  | $ | 3,281 |  |  | $ | 2,958 |  |  | $ | 5,571 |  |  | $ | 3,178 |

Set forth below is a reconciliation of our GAAP net income attributable to common shareholders, per share to our non-GAAP adjusted net income per share:

|  | Three Months Ended June 30, |  |  | Six Months Ended June 30, |
|  | 2025 |  |  | 2024 |  |  | 2025 |  |  | 2024 |
GAAP net income (loss) attributable to common shareholders, per share |  | $ | 0.04 |  |  | $ | (0.14 | ) |  | $ | 0.02 |  |  | $ | (0.24 | )
Impact of preferred stock dividend |  |  | 0.03 |  |  |  | 0.24 |  |  |  | 0.09 |  |  |  | 0.33 |
Net income per end-of-period share |  |  | 0.07 |  |  |  | 0.10 |  |  |  | 0.11 |  |  |  | 0.09 |
Foreign exchange loss / other expense |  |  | 0.00 |  |  |  | 0.02 |  |  |  | 0.00 |  |  |  | 0.02 |
Stock-based compensation expense (benefit) |  |  | 0.00 |  |  |  | 0.01 |  |  |  | 0.01 |  |  |  | (0.03 | )
Amortization of purchased intangible assets |  |  | 0.00 |  |  |  | 0.04 |  |  |  | 0.01 |  |  |  | 0.09 |
Transaction and integration costs |  |  | 0.00 |  |  |  | 0.00 |  |  |  | 0.00 |  |  |  | 0.00 |
Restructuring costs |  |  | 0.00 |  |  |  | 0.01 |  |  |  | 0.00 |  |  |  | 0.03 |
Non-GAAP adjusted earnings per share |  | $ | 0.07 |  |  | $ | 0.18 |  |  | $ | 0.13 |  |  | $ | 0.20 |

For purposes of determining non-GAAP adjusted earnings per share, the Company used the number of common shares outstanding at the end of June 30, 2025 and 2024. Non-GAAP adjusted earnings per share does not take into account dividends declared or earned on preferred stock.

Key Metrics

In addition to the line items in our condensed consolidated financial statements, we regularly review the following metrics. We believe information on these metrics is useful for investors to understand the underlying trends in our business.

Providers and Practices Served: As of both June 30, 2025 and 2024, we provided services to approximately 40,000 providers (which we define as physicians, nurses, nurse practitioners, physician assistants and other clinical staff that render bills for their services), representing approximately 2,600 independent medical practices and hospitals. In addition, we served approximately 150 clients who were not medical practices, but are service organizations who serve the healthcare community. The foregoing numbers include clients leveraging any of our products or services and are based in part upon estimates in cases where the precise number of practices or providers is unknown.

33

Sources of Revenue

Revenue: We primarily derive our revenues from subscription-based technology-enabled business solutions, reported in our Healthcare IT segment, which are typically billed as a percentage of payments collected by our customers. This fee includes technology-enabled RCM, as well as the ability to use our EHR, practice management system and other software as part of the bundled fee. These solutions accounted for approximately 69% and 68% for the three months ended June 30, 2025 and 2024, respectively, and 67% for both the six months ended June 30, 2025 and 2024. Other healthcare IT services, including printing and mailing operations, group purchasing and professional services, represented approximately 19% and 20% of revenues for the three months ended June 30, 2025 and 2024, respectively, and 22% and 21% for the six months ended June 30, 2025 and 2024, respectively.

We earned approximately 12% of our revenue from medical practice management services during the three and six months ended June 30, 2025 and 2024. This revenue represents fees based on our actual costs plus a percentage of the operating profit and is reported in our Medical Practice Management segment.

Operating Expenses

Direct Operating Costs. Direct operating cost consists primarily of salaries and benefits related to personnel who provide services to our customers, claims processing costs, costs to operate the three managed practices, including facility lease costs, supplies, insurance and other direct costs related to our services. Costs associated with the implementation of new customers are expensed as incurred. The reported amounts of direct operating costs do not include depreciation and amortization, which are broken out separately in the condensed consolidated statements of operations.

Selling and Marketing Expense. Selling and marketing expense consists primarily of compensation and benefits, commissions, travel and advertising expenses.

General and Administrative Expense. General and administrative expense consists primarily of personnel-related expense for administrative employees, including compensation, benefits, travel, facility lease costs, insurance, software license fees and outside professional fees.

Research and Development Expense. Research and development expense consists primarily of personnel-related costs, software expense and third-party contractor costs.

Depreciation and Amortization Expense. Depreciation expense is charged using the straight-line method over the estimated lives of the assets ranging from three to five years. Amortization expense is charged on either an accelerated or on a straight-line basis over a period of three or four years for most intangible assets acquired in connection with acquisitions including those intangibles related to the group purchasing services. Amortization expense related to the value of our medical practice management clients is amortized on a straight-line basis over a period of twelve years.

Restructuring Costs. Restructuring costs primarily consists of severance and separation costs associated with the optimization of the Company’s operations and profitability improvements.

Interest and Other Income (Expense) - net. Interest income represents interest earned on temporary cash investments and late fees from customers. Interest expense consists primarily of interest costs related to our line of credit, term loans and the amortization of deferred financing costs. Other income (expense) - net results primarily from foreign currency transaction gains/(losses).

Income Taxes. In preparing our condensed consolidated financial statements, we estimate income taxes in each of the jurisdictions in which we operate. This process involves estimating actual current tax exposure together with assessing temporary differences resulting from differing treatment of items for tax and financial reporting purposes. These differences result in deferred income tax assets and liabilities. Although the Company has returned to profitability, it incurred losses historically and there is uncertainty regarding sufficient future U.S. taxable income, which makes realization of a deferred tax asset difficult to support in accordance with ASC 740. Accordingly, a valuation allowance has been recorded against all deferred tax assets as of June 30, 2025 and December 31, 2024.

34

Critical Accounting Policies and Estimates

The critical accounting policies and estimates used in the preparation of our condensed consolidated financial statements that we believe affect our more significant judgments and estimates used in the preparation of our condensed consolidated financial statements presented in this Report are described in Management’s Discussion and Analysis of Financial Condition and Results of Operations and in the Notes to the Consolidated Financial Statements included in our Annual Report on Form 10-K/A for the year ended December 31, 2024.

Capitalized Software Costs:

As of June 30, 2025 and December 31, 2024, the carrying amounts of internally-developed capitalized software in use was $8.7 million and $12.3 million, respectively. The decrease was due to the amortization exceeding the amounts being capitalized.

There have been no material changes in our critical accounting policies and estimates from those described in the Management’s Discussion and Analysis of Financial Condition and Results of Operations, included in our Annual Report on Form 10-K/A for the year ended December 31, 2024, filed with the SEC on April 3, 2025.

Results of Operations

The following table sets forth our consolidated results of operations as a percentage of total revenue for the periods shown:

|  | Three Months Ended June 30, |  |  | Six Months Ended June 30, |
|  | 2025 |  |  | 2024 |  |  | 2025 |  |  | 2024 |
Net revenue |  |  | 100.0 | % |  |  | 100.0 | % |  |  | 100.0 | % |  |  | 100.0 | %
Operating expenses: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Direct operating costs |  |  | 52.9 | % |  |  | 54.3 | % |  |  | 54.4 | % |  |  | 56.3 | %
Selling and marketing |  |  | 4.1 | % |  |  | 5.9 | % |  |  | 4.1 | % |  |  | 6.4 | %
General and administrative |  |  | 15.9 | % |  |  | 14.3 | % |  |  | 15.8 | % |  |  | 14.3 | %
Research and development |  |  | 3.7 | % |  |  | 3.8 | % |  |  | 4.1 | % |  |  | 3.6 | %
Depreciation and amortization |  |  | 12.4 | % |  |  | 13.2 | % |  |  | 12.2 | % |  |  | 14.1 | %
Restructuring costs |  |  | 0.1 | % |  |  | 0.4 | % |  |  | 0.3 | % |  |  | 0.8 | %
Total operating expenses |  |  | 89.1 | % |  |  | 91.9 | % |  |  | 90.9 | % |  |  | 95.5 | %
Operating income |  |  | 10.9 | % |  |  | 8.1 | % |  |  | 9.1 | % |  |  | 4.5 | %
Net interest expense |  |  | (0.1 | %) |  |  | (0.9 | %) |  |  | 0.0 | % |  |  | (1.1 | %)
Other expense - net |  |  | (0.1 | %) |  |  | (1.0 | %) |  |  | (0.1 | %) |  |  | (0.5 | %)
Income before provision for income taxes |  |  | 10.7 | % |  |  | 6.2 | % |  |  | 9.0 | % |  |  | 2.9 | %
Income tax provision |  |  | 0.1 | % |  |  | 0.1 | % |  |  | 0.2 | % |  |  | 0.1 | %
Net income |  |  | 10.6 | % |  |  | 6.1 | % |  |  | 8.8 | % |  |  | 2.8 | %

Comparison of the three and six months ended June 30, 2025 and 2024:

|  | Three Months Ended June 30, |  |  | Change |  |  | Six Months Ended June 30, |  |  | Change |
|  | 2025 |  |  | 2024 |  |  | Amount |  |  | Percent |  |  | 2025 |  |  | 2024 |  |  | Amount |  |  | Percent |
|  | ($ in thousands) |
Net revenue |  | $ | 27,377 |  |  | $ | 28,090 |  |  | $ | (713 | ) |  |  | (3 | %) |  | $ | 55,009 |  |  | $ | 54,052 |  |  | $ | 957 |  |  |  | 2 | %

35

Net Revenue. Net revenue of $27.4 million and $55.0 million for the three and six months ended June 30, 2025, respectively, decreased by $713,000 or 3% and increased by $957,000 or 2% from net revenue of $28.1 million and $54.1 million for the three and six months ended June 30, 2024, respectively. Revenue for the three and six months ended June 30, 2025 includes $19.0 million and $36.7 million relating to technology-enabled business solutions, $4.1 million and $10.0 million related to professional services and $3.3 million and $6.3 million for medical practice management services, respectively.

There was approximately a $415,000 decrease and a $1.1 million increase in professional services revenue, a $43,000 decrease and $379,000 increase in technology-enabled business solutions revenue, and a $210,000 and $461,000 decrease in medical practice management services revenue for the three and six months ended June 30, 2025, respectively, compared to the same period in the prior year.

|  | Three Months Ended June 30, |  |  | Change |  |  | Six Months Ended June 30, |  |  | Change |
|  | 2025 |  |  | 2024 |  |  | Amount |  |  | Percent |  |  | 2025 |  |  | 2024 |  |  | Amount |  |  | Percent |
|  | ($ in thousands) |
Direct operating costs |  | $ | 14,480 |  |  | $ | 15,242 |  |  | $ | (762 | ) |  |  | (5 | %) |  | $ | 29,944 |  |  | $ | 30,419 |  |  | $ | (475 | ) |  |  | (2 | %)
Selling and marketing |  |  | 1,118 |  |  |  | 1,664 |  |  |  | (546 | ) |  |  | (33 | %) |  |  | 2,249 |  |  |  | 3,434 |  |  |  | (1,185 | ) |  |  | (35 | %)
General and administrative |  |  | 4,358 |  |  |  | 4,028 |  |  |  | 330 |  |  |  | 8 | % |  |  | 8,690 |  |  |  | 7,749 |  |  |  | 941 |  |  |  | 12 | %
Research and development |  |  | 1,020 |  |  |  | 1,055 |  |  |  | (35 | ) |  |  | (3 | %) |  |  | 2,255 |  |  |  | 1,968 |  |  |  | 287 |  |  |  | 15 | %
Depreciation |  |  | 594 |  |  |  | 503 |  |  |  | 91 |  |  |  | 18 | % |  |  | 1,155 |  |  |  | 1,006 |  |  |  | 149 |  |  |  | 15 | %
Amortization |  |  | 2,788 |  |  |  | 3,211 |  |  |  | (423 | ) |  |  | (13 | %) |  |  | 5,564 |  |  |  | 6,638 |  |  |  | (1,074 | ) |  |  | (16 | %)
Restructuring costs |  |  | 23 |  |  |  | 116 |  |  |  | (93 | ) |  |  | (80 | %) |  |  | 137 |  |  |  | 438 |  |  |  | (301 | ) |  |  | (69 | %)
Total operating expenses |  | $ | 24,381 |  |  | $ | 25,819 |  |  | $ | (1,438 | ) |  |  | (6 | %) |  | $ | 49,994 |  |  | $ | 51,652 |  |  | $ | (1,658 | ) |  |  | (3 | %)

Direct Operating Costs. Direct operating costs of $14.5 million and $29.9 million for the three and six months ended June 30, 2025, respectively, decreased by $762,000 or 5% and $475,000 or 2% compared to direct operating costs of $15.2 million and $30.4 million for the three and six months ended June 30, 2024, respectively. During the three and six months ended June 30, 2025, salary costs decreased by $341,000 and increased by $18,000, outsourcing and processing costs decreased by $383,000 and $405,000 and billable expenses decreased by $274,000 and $258,000, respectively. The decrease in the salary costs primarily relates to professional services salaries due to the decreased professional services revenue.

Selling and Marketing Expense. Selling and marketing expense of $1.1 million and $2.2 million for the three and six months ended June 30, 2025, respectively, decreased by $546,000 or 33% and $1.2 million or 35% from selling and marketing expense of $1.7 million and $3.4 million for the three and six months ended June 30, 2024, respectively. The decrease for the three and six months ended June 30, 2025 was due to a reduction in headcount and lower spending on selling and marketing activities.

General and Administrative Expense. General and administrative expense of $4.4 million and $8.7 million for the three and six months ended June 30, 2025, respectively, increased by $330,000 or 8% and $941,000 or 12% compared to general and administrative expense of $4.0 million and $7.7 million for the three and six months ended June 30, 2024, respectively. During the three and six months ended June 30, 2025, salary costs increased by $385,000 and $1.4 million, respectively and legal and professional fees decreased by $170,000 and $459,000, respectively.

Research and Development Expense. Research and development expense of $1.0 million and $2.3 million for the three and six months ended June 30, 2025, respectively, decreased by approximately $35,000 or 3% and increased by $287,000 or 15% from research and development expense of $1.1 million and $2.0 million for the three and six months ended June 30, 2024, respectively. During the six months ended June 30, 2025 and 2024, the Company capitalized approximately $1.7 million and $3.0 million, respectively, of development costs in connection with its internal-use software. The increase in expense was primarily due to a shift in the nature of development activities, with fewer costs qualifying for capitalization as internal-use software, resulting in a greater portion of costs being recognized as operating expenses in the current period.

36

Depreciation Expense. Depreciation expense of $594,000 and $1.2 million for the three and six months ended June 30, 2025, respectively, increased by $91,000 and $149,000 from depreciation of $503,000 and $1.1 million for the three and six months ended June 30, 2024, respectively.

Amortization Expense. Amortization expense of $2.8 million and $5.6 million for the three and six months ended June 30, 2025, respectively, decreased by $423,000 or 13% and $1.1 million or 16% from amortization expense of $3.2 million and $6.6 million for the three and six months ended June 30, 2024, respectively. The decrease for the three and six months ended June 30, 2025, was due to previously acquired customer relationships becoming fully amortized.

Restructuring Costs. Restructuring costs of $23,000 and $137,000 for the three and six months ended June 30, 2025, respectively primarily consists of severance and separation costs associated with the optimization of the Company’s operations and profitability improvements. There were $116,000 and $438,000 of restructuring costs for the three and six months ended June 30, 2024, respectively.

|  | Three Months Ended June 30, |  |  | Change |  |  | Six Months Ended June 30, |  |  | Change |
|  | 2025 |  |  | 2024 |  |  | Amount |  |  | Percent |  |  | 2025 |  |  | 2024 |  |  | Amount |  |  | Percent |
|  | ($ in thousands) |
Interest income |  | $ | 51 |  |  | $ | 24 |  |  | $ | 27 |  |  |  | 113 | % |  | $ | 93 |  |  | $ | 51 |  |  | $ | 42 |  |  |  | 82 | %
Interest expense |  |  | (68 | ) |  |  | (288 | ) |  |  | (220 | ) |  |  | (76 | %) |  |  | (126 | ) |  |  | (653 | ) |  |  | (527 | ) |  |  | (81 | %)
Other expense - net |  |  | (35 | ) |  |  | (294 | ) |  |  | 259 |  |  |  | 88 | % |  |  | (49 | ) |  |  | (287 | ) |  |  | 238 |  |  |  | (83 | %)
Income tax provision |  |  | 42 |  |  |  | 39 |  |  |  | 3 |  |  |  | 8 | % |  |  | 83 |  |  |  | 78 |  |  |  | 5 |  |  |  | 6 | %

Interest Income. Interest income of $51,000 and $93,000 for the three and six months ended June 30, 2025, respectively, increased by $27,000 and $42,000 from interest income of $24,000 and $51,000 for the three and six months ended June 30, 2024, respectively. The interest income represents late fees from customers and interest earned on temporary cash investments, which increased due to additional funds being temporarily invested.

Interest Expense. Interest expense of $68,000 and $126,000 for the three and six months ended June 30, 2025, respectively, decreased by $220,000 and $527,000 from interest expense of $288,000 and $653,000 for the three and six months ended June 30, 2024, respectively. The interest expense decrease was due to no borrowings on the line of credit during 2025. Interest expense on the line of credit was $25,000 and $518,000 during the six months ended June 30, 2025 and 2024, respectively and includes fee related to the line of credit.

Other (Expense) – net. Other Expense – net was $35,000 and $49,000 for the three and six months ended June 30, 2025, respectively, compared to other expense – net of $294,000 and $287,000 for the three and six months ended June 30, 2024, respectively. Other expense or income primarily represents foreign currency transaction losses or gains. These transaction losses or gains result from revaluing intercompany accounts which are denominated in U.S. dollars that represent amounts payable/receivable between the entities. Whenever the exchange rate varies, the losses or gains are recorded in the condensed consolidated statements of operations.

Income Tax Provision. The provision for income taxes was $42,000 and $83,000 for the three and six months ended June 30, 2025, respectively, compared to the provision for income taxes of $39,000 and $78,000 for the three and six months ended June 30, 2024, respectively. In 2023, there was a goodwill impairment charge of $42 million, a portion of which was allocated to the tax deductible portion of the goodwill balance. The impairment charge resulted in the reversal of the entire deferred tax liability at December 31, 2023. There was no deferred tax liability recorded at December 31, 2024 or June 30, 2025. There were no deferred income taxes for the three and six months ended June 30, 2025 and 2024.

The current income tax expense for the three and six months ended June 30, 2025 was approximately $42,000 and $83,000, respectively, which represents state minimum taxes and foreign income taxes. Although the Company has returned to profitability, it incurred losses historically and there is uncertainty regarding sufficient future U.S. taxable income, which makes realization of a deferred tax losses difficult to support in accordance with ASC 740. Accordingly, a valuation allowance was recorded against all deferred tax assets at June 30, 2025 and December 31, 2024.

37

On July 4, 2025, the One Big Beautiful Bill Act (“OBBBA”) was signed into law, extending key provisions of the 2017 Tax Cuts and Jobs Act including, but not limited to, federal bonus depreciation and deductions for domestic research and development expenditures. The Company is currently evaluating OBBBA, however, it is not expected to have a material impact on the Company’s consolidated financial statements.

Liquidity and Capital Resources

As of June 30, 2025, the Company had total cash of $10.4 million and net working capital of $14.9 million. For the six months ended June 30, 2025, cash provided by operations was $12.5 million offset by cash used in investing and financing activities of $7.2 million resulting in an increase in cash of $5.3 million after accounting for the effect of $29,000 of exchange rate changes. As of June 30, 2025, there were no borrowings under the credit facility as compared to $5.0 million outstanding on the line of credit as of June 30, 2024.

For the three and six months ended June 30, 2025, the Company recorded net income of $2.9 million and $4.9 million, respectively. Management developed a plan that was substantially implemented during fiscal 2023 and 2024 to improve liquidity in its operations through reductions in payroll and operating expenses. The Company suspended its Preferred Stock dividends in December 2023, which was resumed in February 2025. Further cost reductions will continue throughout 2025.

Management continues to focus on the Company’s overall profitability, including managing expenses, and to the extent possible growing revenue, and expects that these efforts will continue to enhance our liquidity and financial position. Based on management’s forecasts, the Company will have sufficient liquidity to meet its obligations as they become due for the next twelve months from the date of the financial statements’ issuance.

We have not been adversely affected by inflation as typically we receive a percentage of the fees our clients collect from our revenue cycle management services. Additionally, our medical practice management contracts are based on our costs plus a percentage of the medical practice’s operating income. We continue to monitor the impact of inflation in order to minimize its effects through pricing strategies, productivity improvements and cost reductions. In the event of inflation, we believe that we will be able to pass on any price increases for fixed rate contracts to our customers, as the prices that we charge are not governed by long-term contracts. The interest rate on our line of credit is based on the prime rate which decreased slightly in 2024 and has remained consistent during 2025.

The Company has a revolving line of credit, and as of June 30, 2025, there were no borrowings under the credit facility. During October 2024, the credit line was reduced to $10 million at the Company’s request. The current unused borrowing base is approximately $9.5 million. The credit line expires in October 2025 and the Company is in the process of renewing the credit line.

The following table summarizes our cash flows for the periods presented:

|  | Three Months Ended June 30, |  |  | Six Months Ended June 30, |  |  | Change |
|  | 2025 |  |  | 2024 |  |  | 2025 |  |  | 2024 |  |  | Amount |  |  | Percent |
|  | ($ in thousands) |  |  |  |
Net cash provided by operating activities |  | $ | 7,408 |  |  | $ | 4,279 |  |  | $ | 12,521 |  |  | $ | 8,345 |  |  | $ | 4,176 |  |  |  | 50 | %
Net cash used in investing activities |  |  | (1,993 | ) |  |  | (1,603 | ) |  |  | (3,503 | ) |  |  | (3,471 | ) |  |  | (32 | ) |  |  | (1 | %)
Net cash used in financing activities |  |  | (1,762 | ) |  |  | (4,138 | ) |  |  | (3,694 | ) |  |  | (5,512 | ) |  |  | 1,818 |  |  |  | 33 | %
Effect of exchange rate changes on cash |  |  | (18 | ) |  |  | (59 | ) |  |  | (29 | ) |  |  | (76 | ) |  |  | 47 |  |  |  | 62 | %
Net increase (decrease) in cash |  | $ | 3,635 |  |  | $ | (1,521 | ) |  | $ | 5,295 |  |  | $ | (714 | ) |  | $ | 6,009 |  |  |  | 842 | %

The income before income taxes was $2.9 million and $4.9 million for the three and six months ended June 30, 2025, respectively, which included $3.4 million and $6.7 million of non-cash depreciation and amortization, respectively. The income before income taxes was $1.7 million and $1.5 million for the three and six months ended June 30, 2024, respectively, which included $3.7 million and $7.6 million of non-cash depreciation and amortization, respectively.

38

Operating Activities

Net cash provided by operating activities was $12.5 million and $8.3 million during the six months ended June 30, 2025 and 2024, respectively. This increase was primarily the result of the increase in the net income of $3.4 million which included the following changes in non-cash items: a decrease in depreciation and amortization of $963,000 offset by a net increase in stock-based compensation of $662,000. Accounts receivable increased $958,000 for the six months ended June 30, 2025, compared with an increase of $1.3 million for the six months ended June 30, 2024. Accounts payable, accrued compensation and accrued expenses increased by $377,000 and $41,000 during the six months ended June 30, 2025 and 2024, respectively. The contract asset decreased by $411,000 during the six months ended June 30, 2025 compared to a decrease of $729,000 in the prior period.

Investing Activities

Net cash used in investing activities was $3.5 million for both the six months ended June 30, 2025 and 2024. Capital expenditures were $1.8 million and $425,000 for the six months ended June 30, 2025 and 2024, respectively. The capital expenditures for the six months ended June 30, 2025 and 2024 primarily represented computer equipment purchased and leasehold improvements for the Pakistan Offices. Software development costs of $1.7 million and $3.0 million for the six months ended June 30, 2025 and 2024, respectively, were capitalized in connection with the development of software for providing technology-enabled business solutions.

Financing Activities

Net cash used in financing activities was $3.7 million and $5.5 million during the six months ended June 30, 2025 and 2024, respectively. Cash used in financing activities during the six months ended June 30, 2025 included $3.3 million of preferred stock dividends, $355,000 of repayments for debt obligations and $22,000 of tax withholding obligations paid in connection with stock awards issued to employees. Cash used in financing activities during the six months ended June 30, 2024 included $328,000 of repayments for debt obligations and $184,000 of tax withholding obligations paid in connection with stock awards issued to employees. Repayments on the line of credit were $5.0 million for the six months ended June 30, 2024.

Contractual Obligations and Commitments

We have contractual obligations under our line of credit. We were in compliance with all covenants as of June 30, 2025. We also maintain operating leases for property and certain office equipment. For additional information, see Contractual Obligations and Commitments under Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” in the Company’s Annual Report on Form 10-K/A for the year ended December 31, 2024, filed with the SEC on April 3, 2025.

Off-Balance Sheet Arrangements

As of June 30, 2025, and 2024, we did not have any relationships with unconsolidated entities or financial partnerships, such as entities often referred to as structured finance or special-purpose entities, which would have been established for the purpose of facilitating off-balance sheet arrangements or other contractually narrow or limited purposes.

Item 3. Quantitative and Qualitative Disclosures about Market Risk

We are a smaller reporting company as defined by 17 C.F.R. 229.10(f)(1) and are not required to provide information under this item, pursuant to Item 305(e) of Regulation S-K.

Item 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

Our management, with the participation of our Co-Chief Executive Officers and Interim Chief Financial Officer, based on the Internal Control-Integrated Framework (2013 framework) issued by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”), evaluated the effectiveness of our disclosure controls and procedures as of June 30, 2025 as required by Rules 13a-15(b) and 15d-15(b) of the Exchange Act. The term “disclosure controls and procedures,” as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act, means controls and other procedures of a company that are designed to ensure that information required to be disclosed by a company in the reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the SEC’s rules and forms.

39

Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by a company in the reports that it files or submits under the Exchange Act is accumulated and communicated to the company’s management, including its principal executive and principal financial officer, to allow timely decisions regarding required disclosure. Management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving their objectives and management necessarily applies its judgment in evaluating the cost-benefit relationship of possible controls and procedures.

Based on the evaluation of our disclosure controls and procedures, as of June 30, 2025, our Co-Chief Executive Officers and Interim Chief Financial Officer concluded that, as of such date, our disclosure controls and procedures were effective. We will continue to improve the controls to ensure that information required to be disclosed by the Company in reports that it files under the Exchange Act is reported within the time periods specified in the Securities and Exchange Commission’s rules and forms.

Changes in Internal Control Over Financial Reporting

There were no changes in our internal control over financial reporting (as defined in Rules 13a-15(f) and l5d-15(f) of the Exchange Act) that occurred during our most recent fiscal quarter that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

For the year ending December 31, 2025, the Company will be required to have an attestation by its independent registered public accounting firm regarding the effectiveness of its internal controls over financial reporting. Additionally, for the year ending December 31, 2025, the Company will become an accelerated filer.

40

Part II. Other Information

Item 1. Legal Proceedings

See discussion of legal proceedings in “Note 9, Commitments And Contingencies” of the Notes to Condensed Consolidated Financial Statements in this Quarterly Report, which is incorporated by reference herein.

Item 1A. Risk Factors

In addition to the other information set forth in this Quarterly Report on Form 10-Q, you should carefully consider the factors discussed in Part I—Item 1A. “Risk Factors” in our Annual Report on Form 10-K/A filed with the SEC on April 3, 2025, which could materially affect our business, financial condition and/or future results. The risks described in our Annual Report on Form 10-K/A are not the only risks facing us. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial may also materially adversely affect our business, financial condition, cash flows and/or future results.

We Maintain Our Cash at Financial Institutions, Often in Balances That Exceed Federally Insured Limits.

The financial markets recently have encountered volatility associated with concerns about the balance sheets of banks, especially small and regional banks who may have significant losses associated with investments that make it difficult to fund demands to withdraw deposits and other liquidity needs. Although the federal government has announced measures to assist these banks and protect depositors, some banks have already been impacted and others may be materially and adversely impacted. Our business is dependent on bank relationships and we are proactively monitoring the financial health of such bank relationships. Continued strain on the banking system may adversely impact our business, financial condition and results of operations.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

Not applicable.

Item 3. Defaults Upon Senior Securities

On December 11, 2023, the Board of Directors suspended the monthly cash dividends for Series A Preferred Stock and Series B Preferred Stock beginning with the payment scheduled for December 15, 2023 together with the remaining dividends that were declared. Effective in September 2024, there was a change in the dividend rate on the Series A Preferred Stock from 11.00% to 8.75%. Due to the conversion of the majority of the Series A Preferred Stock in March 2025, the dividend amount due on the converted shares resulting from the suspension was settled. During February 2025 and continuing monthly thereafter, the Company resumed payment of the dividends, paying one month of dividends in arrears each month based on the oldest dividend amount outstanding. As a result of such suspension, as of the filing date of this Quarterly Report, the Company has approximately $7.1 million of dividends in arrears. During this suspension, dividends continued to accumulate in arrears on the remaining Series A and Series B Preferred Stock. See discussion of preferred stock dividend suspension in “Note 12, Shareholders’ Equity” of the Notes to Condensed Consolidated Financial Statements in this Quarterly Report.

Item 4. Mine Safety Disclosures

Not applicable.

Item 5. Other Information

During the quarter ended June 30, 2025, none of the Company’s directors or officers (as defined in Rule 16a-1(f) of the Exchange Act) adopted, modified or terminated a Rule 10b5-1 trading arrangement or non-Rule 10b5-1 trading arrangement (as such terms are defined in Item 408 of Regulation S-K).

41

Item 6. Exhibits

Exhibit Number |  | Exhibit Description
31.1 |  | Certification of the Company’s Co-Principal Executive Officer pursuant to Rules 13a-14(a)/15d-14(a), of the Securities Exchange Act of 1934, as amended.
31.2 |  | Certification of the Company’s Co-Principal Executive Officer pursuant to Rules 13a-14(a)/15d-14(a), of the Securities Exchange Act of 1934, as amended.
31.3 |  | Certification of the Company’s Principal Financial Officer pursuant to Rules 13a-14(a)/15d-14(a), of the Securities Exchange Act of 1934, as amended.
32.1* |  | Certification of the Company’s Co-Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2* |  | Certification of the Company’s Co-Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.3* |  | Certification of the Company’s Interim Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101.INS |  | XBRL Instance
101.SCH |  | XBRL Taxonomy Extension Schema
101.CAL |  | XBRL Taxonomy Extension Calculation Linkbase
101.LAB |  | XBRL Taxonomy Extension Label Linkbase
101.PRE |  | XBRL Taxonomy Extension Presentation Linkbase
101.DEF 104 |  | XBRL Taxonomy Extension Definition Linkbase Cover Page Interactive Data File (embedded within the Inline XBRL document)

*The certifications on Exhibit 32 hereto are not deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liability of that Section. Such certifications will not be deemed incorporated by reference into any filing under the Securities Act or the Exchange Act.

42

Signatures

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

| CareCloud, Inc.
| By: | /s/ A. Hadi Chaudhry
|  | A. Hadi Chaudhry
|  | Co-Chief Executive Officer
|  | Date: August 5, 2025
| By: | /s/ Stephen Snyder
|  | Stephen Snyder
|  | Co-Chief Executive Officer
|  | Date: August 5, 2025
| By: | /s/ Norman S. Roth
|  | Norman S. Roth
|  | Interim Chief Financial Officer and Corporate Controller
|  | Date: August 5, 2025

43