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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K/A

(Amendment No.1)

(Mark One)

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

For the fiscal year ended December 31, 2023

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 001-3951 5

American Well Corporation

(Exact name of Registrant as specified in its charter)

Delaware | 20-5009396
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.)
75 State Street, 26th Floor Boston, MA | 02109
(Address of principal executive offices) | (Zip Code)

Registrant’s telephone number, including area code: (617) 204-3500

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

Title of each class |  | Trading Symbol(s) |  | Name of each exchange on which registered
Class A common stock, par value of $0.01 per share |  | AMWL |  | The New York Stock Exchange

Securities registered pursuant to Section 12(g) of the Act: None

Indicate by check mark if the Registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ☐ No ☒

Indicate by check mark if the Registrant is not required to file reports pursuant to Section 13 or 15(d) of the Act. Yes ☐ No ☒

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, 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 has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. ☒

If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction of an error to previously issued financial statements. ☐

Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant’s executive officers during the relevant recovery period pursuant to §240.10D-1(b). ☐

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

The aggregate market value of the voting and non-voting stock held by non-affiliates of the Registrant, based on the closing price of the shares of Class A common stock on The New York Stock Exchange as of the last business day of the registrant’s most recently completed second fiscal quarter was approximately $515 million. Common stock held by each executive officer, director and by each person known to the registrant who owned 10% or more of its outstanding common stock have been excluded in that such persons may be deemed to be affiliates. This determination of affiliate status is not necessarily a conclusive determination for other purposes.

As of February 2, 2024 the number of shares of Registrant’s Class A common stock outstanding was 256,306,641, the number of shares of Registrant’s Class B common stock outstanding was 27,390,397, and the number of shares of Registrant’s Class C common stock outstanding was 5,555,555.

DOCUMENTS INCORPORATED BY REFERENCE

The Registrant intends to file a definitive proxy statement pursuant to Regulation 14A relating to the 2024 Annual Meeting of Stockholders within 120 days of the end of the Registrant’s fiscal year ended December 31, 2023. Portions of such definitive proxy statement are incorporated by reference into Part III of this Annual Report on Form 10-K to the extent stated herein.

Auditor Firm Id: 238 Auditor Name: PricewaterhouseCoopers LLP Auditor Location: Boston, Massachusetts, United States

EXPLANATORY NOTE

This Amendment No. 1 on Form 10-K/A (“Amendment No. 1”) to the Annual Report on Form 10-K of American Well Corporation for the fiscal year ended December 31, 2023, originally filed with the Securities and Exchange Commission on February 15, 2024 (the “Original Filing”), is being filed to correct a typographical error in the Original Filing to reflect the correct signing date of the Report of Independent Registered Public Accounting Firm of PricewaterhouseCoopers LLP.

This Amendment No. 1 is being filed solely to correct the date within the Report of Independent Registered Public Accounting Firm. This Amendment No. 1 includes: Item 8 of Part II, “Financial Statements and Supplementary Data” and Item 9A, in its entirety and without change from the Original Filing other than the correction of the signing date of the Report of Independent Registered Public Accounting Firm.

In addition, pursuant to the rules of the SEC, the exhibit list included herewith reflects currently-dated certifications from the Company’s co-Chief Executive Officers and Chief Financial Officer, which are filed as exhibits to this Amendment No. 1.

Except for the foregoing amended information, this Amendment No. 1 does not amend or update any other information contained in the Original Filing, or reflect any events that have occurred after the filing of the Original Filing. Accordingly, this Amendment No. 1 should be read in conjunction with the Original Filing.

Item 8. Financial Statement s and Supplementary Data.

The financial statements required to be filed pursuant to this Item 8 are appended to this Annual Report on Form 10-K, which financial statements are incorporated by reference in response to this Item 8. An index of those financial statements is found in “Item 15. Exhibits and Financial Statement Schedules” of this Annual Report on Form 10-K.

Item 9A. Controls and Procedures.

Evaluation of Disclosure Controls and Procedures

Our management, with the participation of our principal executive officers and principal financial officer, evaluated the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) as of December 31, 2023. Disclosure controls and procedures refer to controls and other procedures designed to ensure that information required to be disclosed in the reports we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms and that such information is accumulated and communicated to our management, including our principal executive officers and principal financial officer, as appropriate, to allow timely decisions regarding required financial disclosure. In designing and evaluating the disclosure controls and procedures, management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives, and management is required to apply its judgment in evaluating the cost-benefit relationship of possible controls and procedures. Based on this evaluation, our principal executive officers and principal financial officer concluded that, as of December 31, 2023, our disclosure controls and procedures were effective at a reasonable assurance level.

Management’s Report on Internal Control over Financial Reporting

Our management is responsible for establishing and maintaining adequate internal control over financial reporting. Our internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. Our internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the Company; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the Company are being made only in accordance with authorizations of management and directors of the Company; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the Company’s assets that could have a material effect on the financial statements.

Under the supervision and with the participation of our management, including our principal executive officers and principal financial officer, we conducted an evaluation of the effectiveness of our internal control over financial reporting as

1

of December 31, 2023, based on the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) in Internal Control—Integrated Framework (2013). Based on this evaluation, management concluded that our internal control over financial reporting was effective as of December 31, 2023.

The effectiveness of our internal control over financial reporting as of December 31, 2023 has been audited by PricewaterhouseCoopers LLP, an independent registered public accounting firm, as stated in their report which is included herein.

Changes in Internal Control over Financial Reporting

There have been no changes in our internal control over financial reporting during the quarter ended December 31, 2023 that materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

2

PART IV

Item 15. Exhibits, Financ ial Statement Schedules.

(1)
Consolidated Financial Statements. For a list of the financial statements included herein, see Index to the Consolidated Financial Statements on page F-1 of this Annual Report on Form 10-K/A, incorporated into this Item by reference.
(2)
Consolidated Financial Statement Schedules. Financial statement schedules have been omitted because they are either not required or not applicable or the information is included in the consolidated financial statements or the notes thereto.
(3)
Exhibits. The exhibits listed below are filed or incorporated by reference as part of this Annual Report on Form 10-K/A.

Exhibit Number |  | Description |  | Incorporation by Reference
|  |  |  | Form |  | File Number |  | Exhibit Number |  | Filing Date
23.1* |  | Consent of Independent Registered Public Accounting Firm |  |  |  |  |  |  |  |
31.1* |  | Certification of Principal Executive Officers Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 |  |  |  |  |  |  |  |
31.2* |  | Certification of Principal Financial Officer Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 |  |  |  |  |  |  |  |
32.1* |  | Certification of Principal Executive Officers 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 Principal 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 |  | Inline XBRL Instance Document – the instance document does not appear in the Interactive Data File because XBRL tags are embedded within the Inline XBRL document. |  |  |  |  |  |  |  |
101.SCH |  | Inline XBRL Taxonomy Extension Schema With Embedded Linkbase Documents |  |  |  |  |  |  |  |
104 |  | Cover page formatted as Inline XBRL and contained in Exhibit 101 |  |  |  |  |  |  |  |

* Filed herewith.

3

SIGNA TURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this Report to be signed on its behalf by the undersigned, thereunto duly authorized.

|  | American Well Corporation
Date: March 1, 2024 |  | By: | /s/ Ido Schoenberg, MD
|  |  | Ido Schoenberg
|  |  | Co-Chief Executive Officer
Date: March 1, 2024 |  | By: | /s/ Roy Schoenberg, MD, MPH
|  |  | Roy Schoenberg
|  |  | Co-Chief Executive Officer

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, this Report has been signed below by the following persons on behalf of the Registrant in the capacities and on the dates indicated.

Name |  | Title |  | Date
/s/ Ido Schoenberg, MD |  | Co-Chief Executive Officer (principal executive officer) |  | March 1, 2024
Ido Schoenberg |  |  |  |
/s/ Roy Schoenberg, MD, MPH |  | Co-Chief Executive Officer (principal executive officer) |  | March 1, 2024
Roy Schoenberg |  |  |  |
/s/ Robert Shepardson |  | Chief Financial Officer (principal financial officer) |  | March 1, 2024
Robert Shepardson |  |  |  |
/s/ Paul McNeice |  | Chief Accounting Officer (principal accounting officer) |  | March 1, 2024
Paul McNeice |  |  |  |

4

Index to consolidated Financial Statements

| Page(s)
Report of Independent Registered Public Accounting Firm | F-2
Consolidated Balance Sheets | F-4
Consolidated Statements of Operations and Comprehensive Loss | F-5
Consolidated Statements of Stockholders’ Equity | F-6
Consolidated Statements of Cash Flows | F-7
Notes to Consolidated Financial Statements | F-8

F-1

Report of Independent Regist ered Public Accounting Firm

To the Board of Directors and Stockholders of American Well Corporation

Opinions on the Financial Statements and Internal Control over Financial Reporting

We have audited the accompanying consolidated balance sheets of American Well Corporation and its subsidiaries (the “Company”) as of December 31, 2023 and 2022, and the related consolidated statements of operations and comprehensive loss, of stockholders’ equity and of cash flows for each of the three years in the period ended December 31, 2023, including the related notes (collectively referred to as the “consolidated financial statements”). We also have audited the Company's internal control over financial reporting as of December 31, 2023, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of the Company as of December 31, 2023 and 2022, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2023 in conformity with accounting principles generally accepted in the United States of America. Also in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2023, based on criteria established in Internal Control - Integrated Framework (2013) issued by the COSO.

Basis for Opinions

The Company's management is responsible for these consolidated financial statements, for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting, included in Management’s Report on Internal Control over Financial Reporting appearing under Item 9A. Our responsibility is to express opinions on the Company’s consolidated financial statements and on the Company's internal control over financial reporting based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud, and whether effective internal control over financial reporting was maintained in all material respects.

Our audits of the consolidated financial statements included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audits also included performing such other procedures as we considered necessary in the circumstances. We believe that our audits provide a reasonable basis for our opinions.

Definition and Limitations of Internal Control over Financial Reporting

A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

F-2

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Critical Audit Matters

The critical audit matter communicated below is a matter arising from the current period audit of the consolidated financial statements that was communicated or required to be communicated to the audit committee and that (i) relates to accounts or disclosures that are material to the consolidated financial statements and (ii) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.

Revenue Recognition - Platform Subscription and Visits

As described in Notes 1, 2 and 3 to the consolidated financial statements, the Company generates revenue primarily from contracts with clients who purchase subscriptions to access the Company’s enterprise software. Clients can also purchase access to the Company’s co-branded digital care practice hosted on the Company’s shared services platform. The Company also generates revenue when either the enterprise digital care platform or the shared services platform is utilized to conduct a medical visit. The Company’s revenue for platform subscription and visits was $231.8 million for the year ended December 31, 2023.

The principal considerations for our determination that performing procedures relating to revenue recognition for platform subscription and visits is a critical audit matter are a high degree of auditor effort in performing procedures and evaluating audit evidence related to accuracy and occurrence of revenue transactions.

Addressing the matter involved performing procedures and evaluating audit evidence in connection with forming our overall opinion on the consolidated financial statements. These procedures included testing the effectiveness of controls relating to revenue recognition, including controls over the accuracy and occurrence of revenue transactions. These procedures also included, among others, evaluating the accuracy and occurrence of a sample of revenue transactions by obtaining and inspecting source documents, including sales contracts, project access approvals, medical records and cash receipts from customers, when applicable.

/s/ PricewaterhouseCoopers LLP

Boston, Massachusetts

February 15, 2024

We have served as the Company’s auditor since 2016.

F-3

AMERICAN WELL CORPORATION

CONSOLIDATED BA LANCE SHEETS

(In thousands, except share and per share amounts)

|  | As of December 31, |
|  | 2023 |  |  | 2022 |
Assets |  |  |  |  |  |
Current assets: |  |  |  |  |  |
Cash and cash equivalents |  | $ | 372,038 |  |  | $ | 538,546 |
Accounts receivable ($1,626 and $2,597, from related parties and net of allowances of $2,291 and $1,884, respectively) |  |  | 54,146 |  |  |  | 58,372 |
Inventories |  |  | 6,652 |  |  |  | 8,737 |
Deferred contract acquisition costs |  |  | 2,262 |  |  |  | 1,394 |
Prepaid expenses and other current assets |  |  | 14,484 |  |  |  | 19,567 |
Total current assets |  |  | 449,582 |  |  |  | 626,616 |
Restricted cash |  |  | 795 |  |  |  | 795 |
Property and equipment, net |  |  | 572 |  |  |  | 1,012 |
Goodwill |  |  | — |  |  |  | 435,279 |
Intangibles assets, net |  |  | 120,248 |  |  |  | 134,980 |
Operating lease right-of-use asset |  |  | 10,453 |  |  |  | 13,509 |
Deferred contract acquisition costs, net of current portion |  |  | 4,792 |  |  |  | 3,394 |
Other assets |  |  | 2,083 |  |  |  | 1,972 |
Investment in minority owned joint venture (Note 2) |  |  | 1,180 |  |  |  | — |
Total assets |  | $ | 589,705 |  |  | $ | 1,217,557 |
Liabilities and Stockholders’ Equity |  |  |  |  |  |
Current liabilities: |  |  |  |  |  |
Accounts payable |  | $ | 4,864 |  |  | $ | 7,236 |
Accrued expenses and other current liabilities |  |  | 38,988 |  |  |  | 54,258 |
Operating lease liability, current |  |  | 3,580 |  |  |  | 3,057 |
Deferred revenue ($1,286 and $1,665 from related parties, respectively) |  |  | 46,365 |  |  |  | 49,505 |
Total current liabilities |  |  | 93,797 |  |  |  | 114,056 |
Other long-term liabilities |  |  | 1,425 |  |  |  | 1,574 |
Operating lease liability, net of current portion |  |  | 8,206 |  |  |  | 11,787 |
Deferred revenue, net of current portion ($0 and $10 from related parties, respectively) |  |  | 6,091 |  |  |  | 6,289 |
Total liabilities |  |  | 109,519 |  |  |  | 133,706 |
Commitments and contingencies (Note 14) |  |  |  |  |  |
Stockholders’ equity: |  |  |  |  |  |
Preferred stock, $0.01 par value; 100,000,000 shares authorized, no shares issued or outstanding as of December 31, 2023 and as of December 31, 2022 |  |  | — |  |  |  | — |
Common stock, $0.01 par value; 1,000,000,000 Class A shares authorized, 255,542,545 and 244,193,727 shares issued and outstanding, respectively; 100,000,000 Class B shares authorized, 27,390,397 shares issued and outstanding, respectively; 200,000,000 Class C shares authorized 5,555,555 issued and outstanding as of December 31, 2023 and as of December 31, 2022 |  |  | 2,879 |  |  |  | 2,766 |
Additional paid-in capital |  |  | 2,234,768 |  |  |  | 2,160,108 |
Accumulated other comprehensive income (loss) |  |  | (15,650 | ) |  |  | (16,969 | )
Accumulated deficit |  |  | (1,757,778 | ) |  |  | (1,082,028 | )
Total American Well Corporation stockholders’ equity |  |  | 464,219 |  |  |  | 1,063,877 |
Non-controlling interest |  |  | 15,967 |  |  |  | 19,974 |
Total stockholders’ equity |  |  | 480,186 |  |  |  | 1,083,851 |
Total liabilities and stockholders’ equity |  | $ | 589,705 |  |  | $ | 1,217,557 |

The accompanying notes are an integral part of these consolidated financial statements.

F-4

AMERICAN WELL CORPORATION

CONSOLIDATED STATEMENTS OF OPER ATIONS AND COMPREHENSIVE LOSS

(In thousands, except share and per share amounts)

|  | Years Ended December 31, |
|  | 2023 |  |  | 2022 |  |  | 2021 |
Revenue |  |  |  |  |  |  |  |  |
($3,859, $4,544 and $12,045 from related parties, respectively) |  | $ | 259,047 |  |  | $ | 277,190 |  |  | $ | 252,789 |
Costs and operating expenses: |  |  |  |  |  |  |  |  |
Costs of revenue, excluding depreciation and amortization of intangible assets |  |  | 164,287 |  |  |  | 160,422 |  |  |  | 148,474 |
Research and development |  |  | 105,827 |  |  |  | 138,487 |  |  |  | 106,594 |
Sales and marketing |  |  | 86,460 |  |  |  | 81,628 |  |  |  | 66,154 |
General and administrative |  |  | 126,645 |  |  |  | 146,353 |  |  |  | 94,624 |
Depreciation and amortization expense |  |  | 31,492 |  |  |  | 26,153 |  |  |  | 16,089 |
Goodwill impairment |  |  | 436,479 |  |  |  | — |  |  |  | — |
Total costs and operating expenses |  |  | 951,190 |  |  |  | 553,043 |  |  |  | 431,935 |
Loss from operations |  |  | (692,143 | ) |  |  | (275,853 | ) |  |  | (179,146 | )
Interest income and other income (expense), net |  |  | 19,422 |  |  |  | 6,123 |  |  |  | 120 |
Loss before benefit (expense) from income taxes and loss from equity method investment |  |  | (672,721 | ) |  |  | (269,730 | ) |  |  | (179,026 | )
(Expense) benefit from income taxes |  |  | (3,860 | ) |  |  | (64 | ) |  |  | 5,376 |
Loss from equity method investment |  |  | (2,590 | ) |  |  | (2,278 | ) |  |  | (3,132 | )
Net loss |  |  | (679,171 | ) |  |  | (272,072 | ) |  |  | (176,782 | )
Net loss attributable to non-controlling interest |  |  | (4,007 | ) |  |  | (1,643 | ) |  |  | (448 | )
Net loss attributable to American Well Corporation |  | $ | (675,164 | ) |  | $ | (270,429 | ) |  | $ | (176,334 | )
Net loss per share attributable to common stockholders, basic and diluted |  | $ | (2.38 | ) |  | $ | (0.99 | ) |  | $ | (0.69 | )
Weighted-average common shares outstanding, basic and diluted |  |  | 284,256,743 |  |  |  | 274,249,749 |  |  |  | 254,068,942 |
Net loss |  | $ | (679,171 | ) |  | $ | (272,072 | ) |  | $ | (176,782 | )
Other comprehensive income (loss), net of tax: |  |  |  |  |  |  |  |  |
Unrealized loss on available-for-sale investments |  |  | — |  |  |  | — |  |  |  | (85 | )
Foreign currency translation |  |  | 1,319 |  |  |  | (10,616 | ) |  |  | (6,565 | )
Comprehensive loss |  |  | (677,852 | ) |  |  | (282,688 | ) |  |  | (183,432 | )
Less: Comprehensive loss attributable to non-controlling interest |  |  | (4,007 | ) |  |  | (1,643 | ) |  |  | (448 | )
Comprehensive loss attributable to American Well Corporation |  | $ | (673,845 | ) |  | $ | (281,045 | ) |  | $ | (182,984 | )

The accompanying notes are an integral part of these consolidated financial statements.

F-5

AMERICAN WELL CORPORATION

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(In thousands, except share amounts)

|  | Common Stock |  |  | Treasury |  |  | Additional Paid-In |  |  | Accumulated Other Comprehensive |  |  | Accumulated |  |  | American Well Corporation Stockholders’ |  |  | Noncontrolling |  |  | Total Stockholders’ |
|  | Shares |  |  | Amount |  |  | Stock |  |  | Capital |  |  | Income (Loss) |  |  | Deficit |  |  | Equity |  |  | Interest |  |  | Equity |
Balances as of December 31, 2020 |  |  | 235,604,105 |  |  | $ | 2,357 |  |  | $ | (37,568 | ) |  | $ | 1,841,405 |  |  | $ | 297 |  |  | $ | (582,359 | ) |  | $ | 1,224,132 |  |  | $ | 22,065 |  |  | $ | 1,246,197 |
Exercise of common stock options |  |  | 6,695,258 |  |  |  | 66 |  |  |  | — |  |  |  | 20,814 |  |  |  | — |  |  |  | — |  |  |  | 20,880 |  |  |  | — |  |  |  | 20,880 |
Vesting of restricted stock units |  |  | 7,394,144 |  |  |  | 75 |  |  |  | — |  |  |  | (75 | ) |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |
Retirement of treasury stock purchased in 2020 |  |  | — |  |  |  | — |  |  |  | 37,568 |  |  |  | (15 | ) |  |  | — |  |  |  | (37,553 | ) |  |  | — |  |  |  | — |  |  |  | — |
Shares withheld related to net share settlement and retired treasury stock in 2021 |  |  | (798,933 | ) |  |  | (8 | ) |  |  | — |  |  |  | 8 |  |  |  | — |  |  |  | (15,038 | ) |  |  | (15,038 | ) |  |  | — |  |  |  | (15,038 | )
Issuance of stock under employee stock purchase plan |  |  | 178,021 |  |  |  | 2 |  |  |  | — |  |  |  | 1,597 |  |  |  | — |  |  |  | — |  |  |  | 1,599 |  |  |  | — |  |  |  | 1,599 |
Issuance of common stock in acquisitions |  |  | 12,798,992 |  |  |  | 128 |  |  |  | — |  |  |  | 143,979 |  |  |  | — |  |  |  | — |  |  |  | 144,107 |  |  |  | — |  |  |  | 144,107 |
Stock-based compensation expense |  |  | — |  |  |  | — |  |  |  | — |  |  |  | 43,809 |  |  |  | — |  |  |  | — |  |  |  | 43,809 |  |  |  | — |  |  |  | 43,809 |
Capital contributed by selling shareholders of acquired businesses |  |  | — |  |  |  | — |  |  |  | — |  |  |  | 2,753 |  |  |  | — |  |  |  | — |  |  |  | 2,753 |  |  |  | — |  |  |  | 2,753 |
Unrealized loss on available-for-sale securities, net of tax |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | (85 | ) |  |  | — |  |  |  | (85 | ) |  |  | — |  |  |  | (85 | )
Currency translation adjustment |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | (6,565 | ) |  |  | — |  |  |  | (6,565 | ) |  |  | — |  |  |  | (6,565 | )
Net loss |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | (176,334 | ) |  |  | (176,334 | ) |  |  | (448 | ) |  |  | (176,782 | )
Balances as of December 31, 2021 |  |  | 261,871,587 |  |  | $ | 2,620 |  |  | $ | — |  |  | $ | 2,054,275 |  |  | $ | (6,353 | ) |  | $ | (811,284 | ) |  | $ | 1,239,258 |  |  | $ | 21,617 |  |  | $ | 1,260,875 |
Exercise of common stock options |  |  | 2,690,448 |  |  |  | 27 |  |  |  | — |  |  |  | 5,639 |  |  |  | — |  |  |  | — |  |  |  | 5,666 |  |  |  | — |  |  |  | 5,666 |
Vesting of restricted stock units |  |  | 5,372,060 |  |  |  | 53 |  |  |  | — |  |  |  | (53 | ) |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |
Shares withheld related to net share settlement and retired treasury stock in 2022 |  |  | (85,002 | ) |  |  | (1 | ) |  |  | — |  |  |  | (44 | ) |  |  | — |  |  |  | (315 | ) |  |  | (360 | ) |  |  | — |  |  |  | (360 | )
Issuance of stock under employee stock purchase plan |  |  | 703,148 |  |  |  | 7 |  |  |  | — |  |  |  | 2,496 |  |  |  | — |  |  |  | — |  |  |  | 2,503 |  |  |  | — |  |  |  | 2,503 |
Issuance of common stock related to Conversa earn-out settlement |  |  | 1,020,964 |  |  |  | 10 |  |  |  | — |  |  |  | 4,288 |  |  |  | — |  |  |  | — |  |  |  | 4,298 |  |  |  | — |  |  |  | 4,298 |
Issuance of common stock related to SilverCloud earn-out settlement |  |  | 4,959,856 |  |  |  | 50 |  |  |  | — |  |  |  | 12,895 |  |  |  | — |  |  |  | — |  |  |  | 12,945 |  |  |  | — |  |  |  | 12,945 |
Issuance of stock related to SilverCloud bonus escrow |  |  | 606,618 |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |
Receipt of Section 16(b) disgorgement |  |  | — |  |  |  | — |  |  |  | — |  |  |  | 295 |  |  |  | — |  |  |  | — |  |  |  | 295 |  |  |  | — |  |  |  | 295 |
Stock-based compensation expense |  |  | — |  |  |  | — |  |  |  | — |  |  |  | 69,144 |  |  |  | — |  |  |  | — |  |  |  | 69,144 |  |  |  | — |  |  |  | 69,144 |
Capital contributed by selling shareholders of acquired businesses |  |  | — |  |  |  | — |  |  |  | — |  |  |  | 11,173 |  |  |  | — |  |  |  | — |  |  |  | 11,173 |  |  |  | — |  |  |  | 11,173 |
Currency translation adjustment |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | (10,616 | ) |  |  | — |  |  |  | (10,616 | ) |  |  | — |  |  |  | (10,616 | )
Net loss |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | (270,429 | ) |  |  | (270,429 | ) |  |  | (1,643 | ) |  |  | (272,072 | )
Balances as of December 31, 2022 |  |  | 277,139,679 |  |  | $ | 2,766 |  |  | $ | — |  |  | $ | 2,160,108 |  |  | $ | (16,969 | ) |  | $ | (1,082,028 | ) |  | $ | 1,063,877 |  |  | $ | 19,974 |  |  | $ | 1,083,851 |
Exercise of common stock options |  |  | 286,599 |  |  |  | 3 |  |  |  | — |  |  |  | 566 |  |  |  | — |  |  |  | — |  |  |  | 569 |  |  |  | — |  |  |  | 569 |
Vesting of restricted stock units |  |  | 10,102,894 |  |  |  | 101 |  |  |  | — |  |  |  | (101 | ) |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |
Shares repurchased and retired |  |  | (264,987 | ) |  |  | (3 | ) |  |  | — |  |  |  | 3 |  |  |  | — |  |  |  | (586 | ) |  |  | (586 | ) |  |  | — |  |  |  | (586 | )
Issuance of stock under employee stock purchase plan |  |  | 1,224,312 |  |  |  | 12 |  |  |  | — |  |  |  | 2,152 |  |  |  | — |  |  |  | — |  |  |  | 2,164 |  |  |  | — |  |  |  | 2,164 |
Stock-based compensation expense |  |  | — |  |  |  | — |  |  |  | — |  |  |  | 72,040 |  |  |  | — |  |  |  | — |  |  |  | 72,040 |  |  |  | — |  |  |  | 72,040 |
Currency translation adjustment |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | 1,319 |  |  |  | — |  |  |  | 1,319 |  |  |  | — |  |  |  | 1,319 |
Net loss |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | (675,164 | ) |  |  | (675,164 | ) |  |  | (4,007 | ) |  |  | (679,171 | )
Balances as of December 31, 2023 |  |  | 288,488,497 |  |  | $ | 2,879 |  |  | $ | — |  |  | $ | 2,234,768 |  |  | $ | (15,650 | ) |  | $ | (1,757,778 | ) |  | $ | 464,219 |  |  | $ | 15,967 |  |  | $ | 480,186 |

The accompanying notes are an integral part of these consolidated financial statements.

F-6

AMERICAN WELL CORPORATION

CONSOLIDATED STATEME NTS OF CASH FLOWS

(In thousands, except share and per share amounts)

|  | Years Ended December 31, |
|  | 2023 |  |  | 2022 |  |  | 2021 |
Cash flows from operating activities: |  |  |  |  |  |  |  |  |
Net loss |  | $ | (679,171 | ) |  | $ | (272,072 | ) |  | $ | (176,782 | )
Adjustments to reconcile net loss to net cash used in operating activities: |  |  |  |  |  |  |  |  |
Goodwill impairment |  |  | 436,479 |  |  |  | — |  |  |  | — |
Depreciation and amortization expense |  |  | 31,512 |  |  |  | 26,167 |  |  |  | 16,089 |
Provisions for credit losses |  |  | 1,057 |  |  |  | 806 |  |  |  | 714 |
Amortization of deferred contract acquisition costs |  |  | 2,261 |  |  |  | 1,684 |  |  |  | 1,971 |
Amortization of deferred contract fulfillment costs |  |  | 432 |  |  |  | 620 |  |  |  | 737 |
Noncash compensation costs incurred by selling shareholders |  |  | — |  |  |  | 11,139 |  |  |  | 2,753 |
Accretion of discounts on debt securities |  |  | (10,010 | ) |  |  | — |  |  |  | — |
Interest on debt securities |  |  | 10,010 |  |  |  | — |  |  |  | — |
Stock-based compensation expense |  |  | 72,246 |  |  |  | 67,675 |  |  |  | 43,809 |
Loss on equity method investment |  |  | 2,590 |  |  |  | 2,278 |  |  |  | 3,132 |
Deferred income taxes |  |  | (242 | ) |  |  | (2,524 | ) |  |  | (6,245 | )
Changes in operating assets and liabilities, net of acquisition: |  |  |  |  |  |  |  |  |
Accounts receivable |  |  | 3,248 |  |  |  | (8,140 | ) |  |  | (512 | )
Inventories |  |  | 2,085 |  |  |  | (1,207 | ) |  |  | 1,598 |
Deferred contract acquisition costs |  |  | (4,499 | ) |  |  | (2,771 | ) |  |  | (2,235 | )
Prepaid expenses and other current assets |  |  | 4,694 |  |  |  | (161 | ) |  |  | (5,775 | )
Other assets |  |  | (76 | ) |  |  | (235 | ) |  |  | 117 |
Accounts payable |  |  | (2,361 | ) |  |  | (4,780 | ) |  |  | 5,546 |
Accrued expenses and other current liabilities |  |  | (15,139 | ) |  |  | 8,962 |  |  |  | (380 | )
Other long-term liabilities |  |  | — |  |  |  | (25 | ) |  |  | (16,705 | )
Deferred revenue |  |  | (3,459 | ) |  |  | (19,739 | ) |  |  | (9,369 | )
Net cash used in operating activities |  |  | (148,343 | ) |  |  | (192,323 | ) |  |  | (141,537 | )
Cash flows from investing activities: |  |  |  |  |  |  |  |  |
Purchases of property and equipment |  |  | (192 | ) |  |  | (292 | ) |  |  | (559 | )
Capitalized software development costs |  |  | (15,056 | ) |  |  | (10,155 | ) |  |  | — |
Investment in less than majority owned joint venture |  |  | (3,920 | ) |  |  | (1,960 | ) |  |  | (2,548 | )
Purchases of investments |  |  | (389,990 | ) |  |  | (499,223 | ) |  |  | — |
Proceeds from sales and maturities of investments |  |  | 389,990 |  |  |  | 500,000 |  |  |  | 100,000 |
Acquisitions of business, net of cash acquired |  |  | — |  |  |  | — |  |  |  | (156,526 | )
Net cash used in investing activities |  |  | (19,168 | ) |  |  | (11,630 | ) |  |  | (59,633 | )
Cash flows from financing activities: |  |  |  |  |  |  |  |  |
Proceeds from exercise of common stock options |  |  | 569 |  |  |  | 5,740 |  |  |  | 20,806 |
Proceeds from employee stock purchase plan |  |  | 2,164 |  |  |  | 2,503 |  |  |  | 1,599 |
Payments for the purchase of treasury stock |  |  | (586 | ) |  |  | (360 | ) |  |  | (15,038 | )
Proceeds from Section 16(b) disgorgement |  |  | — |  |  |  | 295 |  |  |  | — |
Payment of contingent consideration |  |  | — |  |  |  | (11,790 | ) |  |  | — |
Payment of deferred offering costs |  |  | — |  |  |  | — |  |  |  | (1,613 | )
Net cash provided by (used in) financing activities |  |  | 2,147 |  |  |  | (3,612 | ) |  |  | 5,754 |
Effect of exchange rates changes on cash, cash equivalents, and restricted cash |  |  | (1,144 | ) |  |  | (305 | ) |  |  | (84 | )
Net (decrease) increase in cash, cash equivalents, and restricted cash |  |  | (166,508 | ) |  |  | (207,870 | ) |  |  | (195,500 | )
Cash, cash equivalents, and restricted cash at beginning of period |  |  | 539,341 |  |  |  | 747,211 |  |  |  | 942,711 |
Cash, cash equivalents, and restricted cash at end of period |  | $ | 372,833 |  |  | $ | 539,341 |  |  | $ | 747,211 |
Cash, cash equivalents, and restricted cash at end of period: |  |  |  |  |  |  |  |  |
Cash and cash equivalents |  |  | 372,038 |  |  |  | 538,546 |  |  |  | 746,416 |
Restricted cash |  |  | 795 |  |  |  | 795 |  |  |  | 795 |
Total cash, cash equivalents, and restricted cash at end of period |  | $ | 372,833 |  |  | $ | 539,341 |  |  | $ | 747,211 |
Supplemental disclosure of cash flow information: |  |  |  |  |  |  |  |  |
Cash paid for income taxes |  | $ | 5,003 |  |  | $ | 1,723 |  |  | $ | 1,587 |
Supplemental disclosure of non-cash investing and financing activities: |  |  |  |  |  |  |  |  |
Issuance of common stock in acquisitions |  | $ | — |  |  | $ | — |  |  | $ | 144,107 |
Issuance of common stock in settlement of earnout |  | $ | — |  |  | $ | 17,243 |  |  | $ | — |
Receivable related to exercise of common stock options |  | $ | — |  |  | $ | — |  |  | $ | 74 |

The accompanying notes are an integral part of these consolidated financial statements.

F-7

AMERICAN WELL CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(In thousands, except share and per share amounts)

1. Organization and Description of Business

Description of Business

American Well Corporation (the “Company”) was incorporated under the laws of the State of Delaware in June 2006. The Company is headquartered in Boston, Massachusetts. The Company is a leading enterprise platform and software company that enables the digital distribution and delivery of care for healthcare’s key stakeholders. The Company’s scalable technology is deployed at the enterprise level of clients, embeds into existing offerings and workflows, spans the continuum of care and enables the delivery of this care across a wide variety of clinical, retail, school and home settings.

The Company is subject to a number of risks similar to other companies of a similar size in the high technology industry, including, but not limited to, uncertainty of progress in developing technologies, new technological innovations, dependence on key personnel, protection of proprietary technology, uncertainty of market acceptance of digital care and the need for additional financing.

Acquisitions

On August 9, 2021 and August 27, 2021, the Company completed the acquisitions of Conversa Health, Inc. (“Conversa”) and SilverCloud Health Holdings, Inc. (“SilverCloud”), respectively (together, the “Acquisitions”). Conversa is a leader in automated virtual healthcare. SilverCloud is a leading digital mental health platform. See Note 8 “Business Combinations”.

Liquidity and Capital Resources

The accompanying consolidated financial statements have been prepared on the basis of continuity of operations, realization of assets, and the satisfaction of liabilities and commitments in the ordinary course of business. Through December 31, 2023, the Company has primarily funded its operations with proceeds from the initial public offering, the sales of convertible preferred stock and revenue from clients who purchase access to the enterprise platform and software as a service. On September 21, 2020 the Company closed on the initial public offering raising $822,267 in gross proceeds. On September 21, 2020 the Company closed on a private placement with Google raising $100,000 in gross proceeds. Since inception, the Company has incurred recurring losses. As of December 31, 2023, the Company had an accumulated deficit of $1,757,778. The Company expects to continue to generate operating losses for the foreseeable future.

The Company expects that its cash, cash equivalents and investments will be sufficient to fund its operating expenses and capital expenditure requirements for at least the next twelve months.

2. Summary of Significant Accounting Policies

Basis of Presentation

The consolidated financial statements are prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and include the accounts of American Well Corporation, its wholly-owned subsidiaries, those of professional corporations, which represent variable interest entities in which American Well has an interest and is the primary beneficiary (“PC”) (see Note 4) and National Telehealth Network (“NTN”), an entity in which American Well controls fifty percent or more of the voting shares (see Note 5). Intercompany accounts and transactions have been eliminated in consolidation.

For consolidated entities where American Well owns or is exposed to less than 100% of the economics, the net income (loss) attributable to noncontrolling interests is recorded in the consolidated statements of operations and comprehensive loss equal to the percentage of the economic or ownership interest retained in each entity by the respective non-controlling party. The noncontrolling interests are presented as a separate component of stockholders’ deficit in the consolidated balance sheets.

F-8

Use of Estimates

The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenue and expenses during the reported periods. Significant estimates and assumptions reflected in these consolidated financial statements include, but are not limited to, revenue recognition, the estimated customer relationship period that is used in the amortization of deferred contract acquisition costs, the valuation of assets and liabilities acquired in business combinations, the useful lives of intangible assets, capitalization of software development costs and the valuation of share awards. The Company bases its estimates on historical experience, known trends, and other market-specific or other relevant factors that it believes to be reasonable under the circumstances. On an ongoing basis, management evaluates its estimates, as there are changes in circumstances, facts and experience. Changes in estimates are recorded in the period in which they become known. Actual results may differ from those estimates or assumptions.

Due to the COVID-19 global pandemic, the global economy and financial markets have been disrupted and there is a significant amount of uncertainty about the length and severity of the consequences caused by the pandemic. The Company has considered information available to it as of the date of issuance of these financial statements and has not experienced any significant impact to its estimates and assumptions as a result of the COVID-19 pandemic. On an ongoing basis, the Company will continue to closely monitor the COVID-19 impact on its estimates and assumptions.

Foreign Currency

The Company’s reporting currency is the U.S. dollar. The Company determines the functional currency of each subsidiary based on the currency of the primary economic environment in which each subsidiary operates. Items included in the financial statements of such subsidiaries are measured using that functional currency.

Foreign currency denominated monetary assets and liabilities are remeasured into U.S. dollars at current exchange rates and foreign currency denominated nonmonetary assets and liabilities are remeasured into U.S. dollars at historical exchange rates. Gains or losses from foreign currency remeasurement and settlements are included in interest income and other income (expense), net in the consolidated statements of operations and comprehensive loss. During the years ended December 31, 2023, 2022 and 2021 the Company’s gains (losses) from foreign currency remeasurement and settlement were $(11), $(377) and $445.

Segment Information

The Company’s chief operating decision makers (CODMs), its two Chief Executive Officers, review financial information presented on a consolidated basis for purposes of allocating resources and evaluating financial performance. The Company operates and manages its business as one reportable and operating segment. In addition, substantially all of the Company’s revenue and long-lived assets are attributable to operations in the United States for all periods presented.

Variable Interest Entities

The Company evaluates its ownership, contractual and other interests in entities to determine if it has any variable interest in a variable interest entity (“VIE”). These evaluations are complex and involve judgment. If the Company determines that an entity in which it holds a contractual or ownership interest is a VIE and that the Company is the primary beneficiary, the Company consolidates such entity in its consolidated financial statements. The primary beneficiary of a VIE is the party that meets both of the following criteria: (i) has the power to make decisions that most significantly affect the economic performance of the VIE; and (ii) has the obligation to absorb losses or the right to receive benefits that in either case could potentially be significant to the VIE. Management performs ongoing reassessments of whether changes in the facts and circumstances regarding the Company’s involvement with a VIE will cause the consolidation conclusion to change. Changes in consolidation status are applied prospectively.

Concentrations of Credit Risk and Significant Clients

Financial instruments that potentially subject the Company to concentrations of credit risk consist primarily of cash, cash equivalents, investments and accounts receivable. The Company invests its excess cash with large financial institutions that the Company believes are of high credit quality. Cash and cash equivalents are invested in highly rated money market funds. At times the Company’s cash balances with individual banking institutions are in excess of federally insured limits. The Company’s investments are invested in U.S. government agency bonds. The Company has not experienced any losses on

F-9

its deposits of cash, cash equivalents or investments. The Company does not believe that it is subject to unusual credit risk beyond the normal credit risk associated with commercial banking relationships.

The Company performs ongoing assessments and credit evaluations of its clients to assess the collectability of the accounts based on a number of factors, including past transaction experience, age of the accounts receivable, review of the invoicing terms of the contracts, and recent communication with clients. The Company has not experienced significant credit losses from its accounts receivable.

As of December 31, 2023 one client accounted for 40% of outstanding accounts receivable and as of December 31, 2022 two client each accounted for 18% of outstanding accounts receivable. For the years ended December 31, 2023, 2022 and 2021, sales to one client (which was a related party during the 2021 period) represented 24%, 23% and 25% of the Company’s total revenue, respectively.

Cash Equivalents

The Company considers all highly liquid investments purchased with maturities of three months or less at the date of purchase to be cash equivalents.

Restricted Cash

As of December 31, 2023 and 2022, the Company maintained letters of credit totaling $795 and $795, respectively, for the benefit of the landlord of its leased property and performance surety bonds. The Company has classified $795 and $795 as non-current on its consolidated balance sheet as of December 31, 2023 and 2022, respectively.

Investments

The Company’s investments are classified as available-for-sale and are carried at fair value, with the unrealized gains and losses reported as a component of accumulated other comprehensive income (loss) in total stockholders’ equity (deficit). The Company has classified its available-for-sale investments as current assets on the consolidated balance sheet as these investments generally consist of highly marketable securities that are identified to be available to meet near-term cash requirements.

Realized gains and losses and declines in value determined to be other than temporary are based on the specific identification method and are included as a component of interest income and other income (expense), net in the consolidated statements of operations and comprehensive loss.

The Company periodically evaluates its investments for other-than-temporary impairment. When assessing investments for other-than-temporary declines in value, the Company considers such factors as, among other things, how significant the decline in value is as a percentage of the original cost, how long the market value of the investment has been less than its original cost, the Company’s ability and intent to retain investment for a period of time sufficient to allow for any anticipated recovery in fair value and market conditions in general. If any adjustment to fair value reflects a decline in the value of the investment that the Company considers to be “other than temporary,” the Company reduces the investment through a charge to the consolidated statement of operations and other comprehensive income (loss). No such adjustments were necessary during the periods presented.

As of December 31, 2023 and 2022, there were no investments that had been in a continuous loss position for more than 12 months.

Accounts Receivable, Net

Accounts receivable primarily consist of amounts billed currently due from clients. Accounts receivable are presented net of an allowance for credit losses, which is an estimate of amounts that may not be collectible. In determining the amount of the allowance at each reporting date, the Company makes judgments about general economic conditions, historical write-off experience and any specific risks identified in client collection matters, including the aging of unpaid accounts receivable and changes in client financial conditions. Account balances are written off after all means of collection are exhausted and the potential for non-recovery is determined to be probable. Adjustments to the allowance for credit losses are recorded as general and administrative expenses in the consolidated statements of operations and comprehensive loss.

F-10

Inventories

The Company values all of its inventories, which consist primarily of raw material hardware components, at the lower of cost or net realizable value on a first-in, first-out basis (“FIFO”). Write-offs of potentially slow moving or damaged inventory are recorded through specific identification of obsolete or damaged material.

Property and Equipment

Property and equipment are stated at cost, net of accumulated depreciation and amortization. Depreciation and amortization are recognized using the straight-line method over the useful life of the assets. Computer equipment is depreciated over three to four years. Computer software, furniture and fixtures and office equipment are depreciated over three years. Leasehold improvements are amortized over the shorter of the lease term or the estimated useful life of the related asset. Repairs and maintenance costs are expensed as incurred. When assets are sold or retired, the cost and related accumulated depreciation or amortization are removed from the accounts, with any resulting gain or loss recorded in the consolidated statements of operations and comprehensive loss.

Business Combinations

The Company accounts for business combinations using the acquisition method of accounting. Application of this method of accounting requires that (i) identifiable assets acquired (including identifiable intangible assets) and liabilities assumed generally be measured and recognized at fair value as of the acquisition date and (ii) the excess of the purchase price over the net fair value of identifiable assets acquired and liabilities assumed be recognized as goodwill. Transaction costs related to business combinations are expensed as incurred in general and administrative expense in the consolidated statement of operations and comprehensive loss.

Determining the fair value of assets acquired and liabilities assumed, and the allocation of the purchase price requires management to use judgment and estimates with regards to the selection of valuation methodologies, especially with respect to intangible assets. Critical estimates in valuing certain identifiable assets include, but are not limited to, significant assumptions related to estimates of future revenue and cash flows, expected long-term market growth, expected revenue growth rates, future expected operating expenses, earnings before interest, taxes, depreciation and amortization margin, and discount rates. Management’s estimates of fair value are based upon assumptions believed to be reasonable, but which are inherently uncertain and unpredictable and, as a result, actual results may differ from estimates. During the measurement period, the Company may record certain adjustments to the carrying value of the assets acquired and liabilities assumed with the corresponding offset to goodwill. After the measurement period, which could last up to one year after the transaction date, all adjustments are recorded in the consolidated statements of operations and comprehensive loss.

Goodwill

The Company recognizes the excess of the purchase price over the fair value of identifiable net assets acquired as goodwill. Goodwill is not amortized but is tested for impairment annually on November 30 or more frequently if events or changes in circumstances indicate that the carrying amount of the goodwill may not be recoverable. These events include: (i) severe adverse industry or economic trends; (ii) significant company-specific actions, including exiting an activity in conjunction with restructuring of operations; (iii) current, historical or projected deterioration of our financial performance; or (iv) a sustained decrease in our market capitalization, as indicated by the Company’s publicly quoted share price, below our net book value. Our goodwill impairment tests are performed at the enterprise level given our single reporting unit.

When testing goodwill for impairment, we have the option of first performing a qualitative assessment to determine whether it is more likely than not that the fair value of our reporting unit is less than its carrying amount. If we elect to bypass the qualitative assessment, or if a qualitative assessment indicates it is more likely than not that carrying value exceeds its fair value, we perform a quantitative goodwill impairment test. Under the quantitative goodwill impairment test, if our reporting unit’s carrying amount exceeds its fair value, we will record an impairment charge based on that difference. A charge is reported as impairment of goodwill in the consolidated statements of operations and comprehensive loss. In the year ended December 31, 2023 there was a full impairment of the goodwill balance. For details associated with the Company's goodwill impairment, see Note 11 - Goodwill and Intangible Assets.

Intangible Assets

Intangible assets acquired in a business combination are recognized at fair value using generally accepted valuation methods deemed appropriate for the type of intangible asset acquired and reported net of accumulated amortization,

F-11

separately from goodwill. Finite-lived intangible assets, which primarily consist of customer relationships, contractor relationships, technology and trade name, are stated at historical cost and amortized over the assets’ estimated useful lives. Intangible assets are re-evaluated whenever events or changes in circumstances indicate that their estimated useful lives may require revision and/or the carrying value of the related asset group may not be recoverable by its projected undiscounted cash flows. If the carrying value of the asset group is determined to be unrecoverable, an impairment charge would be recognized in an amount equal to the amount by which the carrying value of the asset group exceeds its fair value. During the year ended December 31, 2023 the Company concluded there was a triggering event and a recoverability test for intangible assets was performed. No impairment was identified as result of the recoverability test. For details associated with the Company's impairment recovery test, see Note 11 - Goodwill and Intangible Assets.

Impairment of Long-Lived Assets

Long-lived assets consist primarily of property and equipment and intangible assets. Long-lived assets to be held and used are tested for recoverability whenever events or changes in business circumstances indicate that the carrying amount of the assets may not be fully recoverable. Factors that the Company considers in deciding when to perform an impairment review include significant underperformance of the business in relation to expectations, significant negative industry or economic trends and significant changes or planned changes in the use of the assets, among others. When testing for asset impairment, the Company groups assets and liabilities at the lowest level for which cash flows are separately identifiable. If an impairment review is performed to evaluate a long-lived asset group for recoverability, the Company compares forecasts of undiscounted cash flows expected to result from the use and eventual disposition of the long-lived asset group to its carrying value. An impairment loss would be recognized when estimated undiscounted future cash flows expected to result from the use of an asset group are less than the asset’s carrying amount. The impairment loss would be based on the excess of the carrying value of the impaired asset group over its fair value. To date, the Company has no t recorded any impairment losses on long-lived assets. No impairments were identified during the years ended December 31, 2023 and 2022.

Investment in Minority Owned Joint Venture

The Company and Cleveland Clinic partnered to form a joint venture, under the name CCAW, JV LLC, to provide broad access to comprehensive and high acuity care services via digital care. The Company does not have a controlling financial interest in CCAW, JV LLC, but it does have the ability to exercise significant influence over the operating and financial policies of CCAW, JV LsLC. Therefore, the Company accounts for its investment in CCAW, JV LLC using the equity method of accounting. The joint venture is considered a variable interest entity under ASC 810-10, but the Company is not the primary beneficiary as it does not have the power to direct the activities of the joint venture that most significantly impact its performance. The Company’s evaluation of ability to impact performance is based on Cleveland Clinic’s managing directors and Cleveland Clinic’s ability to appoint and remove the chairperson who has the ability to cast the tie breaking vote on the most significant activities.

During the year ended December 31, 2020, the Company contributed $2,940 as its initial investment for a 49% interest in CCAW, JV LLC. The agreement also requires aggregate total capital contributions by the Company up to an additional $11,800 in two phases, which is yet to be defined. During the years ended December 31, 2023, 2022 and 2021 the Company made a capital contribution of $3,920, $1,960 and $2,548 related to a portion of the phase one capital commitment. For the years ended December 31, 2023, 2022 and 2021, the Company recognized a loss of $2,590, $2,278 and $3,132 as its proportionate share of the joint ventures results of operations, respectively. Accordingly, the carrying value of the equity method investment as of December 31, 2023 and 2022 was $1,180 and $(150), respectively. As the share of losses exceeds the carrying amount of the investment, the carrying amount as of December 31, 2022 it is included in the balance of accrued expenses and other current liabilities on the consolidated balance sheet.

Advertising Costs

Advertising costs are expensed as incurred and are included in sales and marketing expense in the consolidated statement of operations and comprehensive loss. For the years ended December 31, 2023, 2022 and 2021, the Company’s advertising expenses were $5,508, $6,607 and $5,604, respectively.

Research and Development Costs

Research and development costs are expensed as incurred. Research and development expenses include payroll, employee benefits and other expenses associated with product development.

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Internal-Use Software

The Company evaluates development costs incurred to develop functionality in connection with its internal-use software for capitalization. Qualifying costs incurred to develop internal-use software are capitalized when (i) the preliminary project stage is completed, (ii) management has authorized further funding for the completion of the project and (iii) it is probable that the project will be completed and performed as intended. Capitalization of these costs ceases once the project is substantially complete and the software is ready for its intended purpose. Capitalized internal-use software costs are included in intangible assets on the consolidated balance sheet for the years ended December 31, 2023 and 2022. There were no impairment charges related to capitalized software development costs during 2023. Capitalized software development costs are amortized using the straight-line method over an estimated useful life of three to five years.

Stock-Based Compensation

The Company measures all stock options and other stock-based awards granted to employees and directors based on the fair value on the date of the grant and recognizes compensation expense of those awards, net of estimated forfeitures, over the requisite service period, which is generally the vesting period of the respective award. Generally, the Company issues stock options, restricted stock units (“RSU’s”) and performance-based market condition share awards ("PSU's") to employees. Stock options and RSUs only have service-based vesting conditions and the Company records the expense for these awards using the straight-line method. Stock option awards and restricted stock units issued to the co-CEOs prior to the IPO or as a result of the IPO (“IPO RSUs”) were expensed when granted as the requisite future service of the awards is not substantive for accounting purposes. PSUs have multiple tranches each with certain market capitalization milestones and service-based vesting conditions and the Company records the expense for these awards over the estimated life of each tranche.

The Company classifies stock-based compensation expense in its consolidated statements of operations and comprehensive loss in the same manner in which the award’s recipient’s payroll costs are classified.

The Company recognizes compensation expense for only the portion of awards that are expected to vest. In developing a forfeiture rate estimate, the Company has considered its historical experience to estimate pre-vesting forfeitures for service-based awards. The impact of a forfeiture rate adjustment will be recognized in full in the period of adjustment, and if the actual forfeiture rate is materially different from the Company’s estimate, the Company may be required to record adjustments to stock-based compensation expense in future periods.

The fair value of each stock option grant is estimated on the date of grant using the Black-Scholes option-pricing model. The restricted stock units issued to the co-CEOs as a result of the IPO had the fair value estimated using a binomial lattice approach. The Company historically had been a private company and lacks company-specific historical and implied volatility information. Therefore, it estimates its expected stock volatility based on the historical volatility of a publicly traded set of peer companies and expects to continue to do so until such time as it has adequate historical data regarding the volatility of its own traded stock price. The expected term of the Company’s stock options has been determined utilizing the “simplified” method for awards that qualify as “plain-vanilla” options. The risk-free interest rate is determined by reference to the U.S. Treasury yield curve in effect at the time of grant of the award for time periods approximately equal to the expected term of the award. The expected dividend yield is based on the fact that the Company has never paid cash dividends and does not expect to pay any cash dividends in the foreseeable future.

The fair value of the PSUs is estimated using a Monte-Carlo valuation simulation. Similar to stock options, the Company estimates its expected stock volatility based on the historical volatility of a publicly traded set of peer companies and expects to continue to do so until such time as it has adequate historical data regarding the volatility of its own traded stock price. The risk-free interest rate is determined by reference to the U.S. Treasury yield curve in effect at the time of grant of the award for time periods approximately equal to the expected term of the award. The expected dividend yield is based on the fact that the Company has never paid cash dividends and does not expect to pay any cash dividends in the foreseeable future.

Deferred Contract Acquisition Costs

The Company capitalizes sales commissions and certain parts of the Company bonus that are incremental to the acquisition of client contracts. These costs are recorded as deferred contract acquisition costs on the consolidated balance sheets. The Company determines whether costs should be deferred based on its sales compensation plans if the commissions are in fact incremental and would not have occurred absent the client contract.

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Sales commissions are paid upon the initial acquisition of a contract and are amortized over an estimated period of benefit of five years. Amortization is recognized on a straight-line basis commensurate with the pattern of revenue recognition. The Company determined the period of benefit for commissions paid for the acquisition of initial contracts by taking into consideration the commitment term of the client contract, the nature of the Company’s technology development life cycle, and an estimated client relationship period. Amortization of deferred contract acquisition costs is included in sales and marketing expenses in the accompanying consolidated statements of operations and comprehensive loss.

The Company reviews these deferred costs to determine whether events or changes in circumstances have occurred that could impact the period of benefit of these deferred contract acquisition costs. There were no impairment losses recorded during the periods presented.

Deferred Contract Fulfillment Costs

The Company capitalizes costs to fulfill contracts with clients in “Prepaid expenses and other current assets” and “Other assets” on its consolidated balance sheet. The Company amortizes these costs to cost of revenue in the consolidated statement of operations and comprehensive loss consistent with the revenue recognition of the performance obligations in the associated contracts. The Company assesses these costs for impairment at the end of each reporting period. There were no impairment losses recorded during the periods presented.

Comprehensive Loss

Comprehensive loss includes net loss as well as other changes in stockholders’ equity (deficit) that result from transactions and economic events other than those with stockholders.

Income Taxes

The Company accounts for income taxes using the asset and liability method, which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been recognized in the financial statements or in the Company’s tax returns. Deferred tax assets and liabilities are determined based on the difference between the financial statement and tax basis of assets and liabilities using the enacted tax rates in effect for the year in which the differences are expected to reverse. Changes in deferred tax assets and liabilities are recorded in the provision for income taxes. The Company assesses the likelihood that its deferred tax assets will be recovered from future taxable income, and to the extent it believes, based upon the weight of available evidence, that it is more likely than not that all or a portion of the deferred tax assets will not be realized, a valuation allowance is established through a charge to income tax expense. The potential for recovery of deferred tax assets is evaluated by considering taxable income in carryback years, existing taxable temporary differences, prudent and feasible tax planning strategies and estimating the future taxable profits.

The Company accounts for uncertainty in income taxes recognized in the financial statements by applying a two-step process to determine the amount of tax benefit to be recognized. First, the tax position must be evaluated to determine the likelihood that it will be sustained upon external examination by the taxing authorities. If the tax position is deemed more-likely-than-not to be sustained, the tax position is then assessed to determine the amount of benefit to recognize in the financial statements. The amount of the benefit that may be recognized is the largest amount that has a greater than 50% likelihood of being realized upon ultimate settlement. The provision for income taxes includes the effects of any resulting tax reserves, or unrecognized tax benefits, that are considered appropriate as well as the related net interest and penalties.

Net Loss per Share

Basic net loss per share attributable to common stockholders is computed by dividing the net loss attributable to common stockholders by the weighted average number of shares of common stock outstanding for the period. Diluted net loss attributable to common stockholders is computed by adjusting net losses attributable to common stockholders to reallocate undistributed earnings based on the potential impact of dilutive securities. Diluted net loss per share attributable to common stockholders is computed by dividing the diluted net loss attributable to common stockholders by the weighted average number of shares of common stock outstanding for the period, including potential dilutive common shares.

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The Company’s convertible preferred stock contractually entitles the holders of such shares to participate in dividends, but contractually does not require the holders of such shares to participate in losses of the Company. Accordingly, in periods in which the Company reports a net loss attributable to common stockholders, diluted net loss per share attributable to common stockholders is the same as basic net loss per share attributable to common stockholders since dilutive common shares are not assumed to have been issued, as their effect is anti-dilutive. The Company reported a net loss attributable to common stockholders for the years ended December 31, 2023, 2022 and 2021.

Revenue Recognition

Platform subscription

The Company generates revenue primarily from contracts with clients who purchase subscriptions to access the Company’s enterprise platform and software as a service which includes access to the Company’s affiliated medical group.

The Company’s clients do not have the right to take possession of the Company’s software operating its digital care platform at any time. Instead, clients are granted access to the Company’s platform over the contractual period. Access to the platform, including the stand ready obligation to provide access to the affiliated medical group, represents a series of distinct services as the Company continually provides access to and fulfills its obligation to the client over the contract term. The typical contract term is three years. Most of the Company’s contracts are non-cancelable over the contractual term. Clients typically have the right to terminate their contracts for cause if the Company fails to perform in accordance with the contractual terms.

For clients who purchase access to the enterprise platform and software as a service (the “Amwell Platform”), the Company hosts a dedicated instance of the Amwell Platform, white-labeled under the client’s own name, branding, and with customized workflows and operating choices. The implementation services for the Amwell Platform are not distinct within the context of the contract because the Company’s promise to perform the implementation services are not separately identifiable from the access to the Amwell Platform. The implementation services, which customize the client’s Amwell Platform, are integral to the client’s ability to derive its intended benefit from the Amwell Platform. The development and implementation services generally span several months and cannot be performed by another entity. Therefore, access to the Amwell Platform and the implementation services are bundled together and represent a single performance obligation. The fixed consideration related to the single performance obligation is generally recognized on a straight-line basis over the contract term beginning on the date access to the Amwell Platform is provided. The Company uses a time-elapsed method to measure progress because the Company transfers control evenly over the contractual period.

Clients can also purchase access to the Company’s co-branded digital care practice hosted on the Company’s shared services platform (the “Amwell Practice”). The implementation services for the Amwell Practice do not significantly modify or customize the Amwell Practice, typically occur over a few days, and can be performed by other entities. Therefore, access to the Amwell Practice and the implementation services are separate outputs promised by the Company and represent two distinct performance obligations.

Clients may be billed prior to the related goods or services being transferred to the client. In determining the transaction price, the Company adjusts the promised amount of consideration for a significant financing component if the timing of payments agreed to by the parties in the contract provide the client a significant benefit of financing. The Company has applied the practical expedient and recognizes the promised amount of consideration without adjusting for the effects of a significant financing component if the Company expects, at contract inception, that the period between the transfer of goods or services to the client when the client pays for that good or service will be one year or less. As of December 31, 2023, the effect of the financing component is not significant and does not materially change the amount of revenue that would be recognized under a contract.

The total fixed consideration is allocated to each distinct performance obligation based on standalone selling price (“SSP”) which reflects the amount that the Company charges for each performance obligation if it was sold separately in a standalone sale. The fixed consideration to access the Amwell Practice is recognized on a straight-line basis over the contract term beginning on the date access to the Amwell Practice is provided. A time-elapsed method is used to measure progress because the Company transfers control evenly over the contractual period. The fixed consideration related to the implementation services is recognized as the services are performed.

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In addition to the fixed consideration received from the Amwell Platform and Amwell Practice, the Company can also receive variable consideration based on the number of members serviced (that is, a stated fee per member per month). The Company allocates the per member per month variable consideration to the month that the fee is earned, correlating with the amount of services it is providing, which is consistent with the allocation objective of the series guidance. Revenue recognized from the per member per month variable consideration does not represent a significant portion of total revenue for the years ended December 31, 2023, 2022 and 2021.

Some contracts with clients contain a renewal option which allows the client to continue access to the Amwell Platform for a stated price after the initial contractual term has ended. These renewal options are evaluated on a case-by-case basis but generally do not provide a material right as they are priced at or above the price for the same service that the Company offers to similar clients and, as such, would not result in a separate performance obligation.

Visits

The Company also generates revenue when either the Amwell Platform or the Amwell Practice is utilized to conduct a medical visit. In the event of a visit, the fee that is earned upon completion of the visit is allocated to the specific day of performance, as the visit fee meets the criteria to allocate variable consideration to a distinct service within a series of distinct services that comprise the single performance obligation. Therefore, visit fees are recognized when the visits are completed, and the Company has delivered on its stand-ready obligation to provide access to the medical professional.

In addition, clients can visit with the Company’s affiliated medical group without purchasing access to an Amwell Platform or Amwell Practice. These direct-to-consumer virtual care visits are available through the Company’s website where clients can conduct a visit with the Company’s affiliated medical group for a fixed fee. The Company’s affiliated medical group is responsible for fulfilling the promise to the client to perform the medical visit. The Company has discretion in establishing the price for the visit, is responsible for the resolution of any client issues, and is exposed to credit risk for the receivable due from the client. Therefore, the Company recognizes the visit fee on a gross basis upon completion of the visit.

Other

Other revenue primarily represents professional services associated with the Amwell Platform. After implementation of the Amwell Platform has been completed, some clients purchase other professional services, which are designed to help clients enhance their ability to use the Amwell Platform. For the majority of arrangements, the Company prices these professional services on a time and material basis, has standalone selling price for these services, and recognizes revenue as services are performed. Other revenue also includes sale of hardware products, such as the Company’s digital care carts and kiosks. Revenue from the sale of hardware products to clients is recognized upon the transfer of control, which occurs upon shipment of the product.

Deferred Revenue

Deferred revenue includes amounts collected or billed in excess of revenue recognized. Deferred revenue is recognized as revenue as the related performance obligations are satisfied. Deferred revenue that will be recognized during the succeeding twelve-month period is recorded as a current liability and the remaining portion is recorded as a noncurrent liability on the consolidated balance sheet.

Leases

The Company determines at the inception of a contract if such arrangement is or contains a lease. A contract is or contains a lease if the contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration. The Company classifies leases at the lease commencement date as operating or finance leases and records a right-of-use asset and a lease liability on the consolidated balance sheet for all leases with an initial lease term of greater than 12 months. Leases with an initial term of 12 months or less are not recorded on the balance sheet, but payments are recognized as expense on a straight-line basis over the lease term.

The Company’s contracts may contain both lease and non-lease components. Non-lease components may include maintenance, utilities, and other operating costs. The Company combines the lease and non-lease components of fixed costs in its lease arrangements as a single lease component. Variable costs, such as utilities or maintenance costs, are not included in the measurement of right-of-use assets and lease liabilities, but rather are expensed when the event determining the amount of variable consideration to be paid occurs.

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Lease liabilities and their corresponding right-of-use assets are recorded based on the present value of future lease payments over the expected lease term. The Company determines the present value of future lease payments by using its estimated secured incremental borrowing rate for that lease term as the interest rate implicit in the lease is not readily determinable. The Company estimates its secured incremental borrowing rate for each lease based on the rate of interest that the Company would have to pay to borrow an amount equal to the lease payments on a collateralized basis over a similar term.

Certain of the Company’s leases include options to extend or terminate the lease. The amounts determined for the Company’s right-of-use assets and lease liabilities generally do not assume that renewal options or early-termination provisions, if any, are exercised, unless it is reasonably certain that the Company will exercise such options.

Recently Issued and Adopted Accounting Pronouncements

In October 2021, the FASB issued ASU 2021-08, Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers (“ASU 2021-08”), which requires that an entity (acquirer) recognize and measure contract assets and contract liabilities acquired in a business combination in accordance with Topic 606. At the acquisition date, an acquirer should account for the related revenue contracts in accordance with Topic 606 as if it had originated the contracts. To achieve this, an acquirer may assess how the acquiree applied Topic 606 to determine what to record for the acquired revenue contracts. Generally, this should result in an acquirer recognizing and measuring the acquired contract assets and contract liabilities consistent with how they were recognized and measured in the acquiree’s financial statements. The guidance was adopted effective July 1, 2021 and impacted the accounting of acquired deferred revenue for the Conversa and SilverCloud acquisitions that occurred in August 2021.

In November 2023, the FASB issued ASU No. 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures (“ASU 2023-07”), which includes amendments to improve reportable segment disclosures. For public entities that are Securities and Exchange Commission filers, ASU 2023-07 is effective for annual periods beginning after December 15, 2023, and interim periods beginning after December 15, 2024. Early adoption is permitted. The adoption is not expected to have a material effect on the Company’s consolidated financial statements.

In December 2023, the FASB issued ASU No. 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures (“ASU 2023-09”), which includes amendments to improve income tax disclosures primarily related to the rate reconciliation and income taxes paid information. For public entities that are Securities and Exchange Commission filers, ASU 2003-09 is effective for annual periods beginning after December 15, 2024. Early adoption is permitted. The adoption is not expected to have a material effect on the Company’s consolidated financial statements.

3. Revenue and Deferred Revenue

Revenue

The following table presents the Company’s revenues disaggregated by revenue source:

|  | Years Ended December 31, |
|  | 2023 |  |  | 2022 |  |  | 2021 |
Platform subscription |  | $ | 112,361 |  |  | $ | 120,919 |  |  | $ | 108,254 |
Visits |  |  | 119,485 |  |  |  | 124,350 |  |  |  | 116,617 |
Other |  |  | 27,201 |  |  |  | 31,921 |  |  |  | 27,918 |
Total Revenue |  | $ | 259,047 |  |  | $ | 277,190 |  |  | $ | 252,789 |

Contract Balances

The Company has rights to consideration for services completed but not billed at the reporting date. Unbilled receivables are classified as receivables when the Company has the right to invoice the client. Unbilled receivables as of December 31, 2023 and December 31, 2022 is $5,500 and $3,566, respectively, and has been included within accounts receivable on the consolidated balance sheet.

Contract liabilities consist of deferred revenue and include billings in advance of performance under the contract. Such amounts are recognized as revenue over the contractual period. For the years ended December 31, 2023, 2022 and 2021, the

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Company recognized revenue of $40,595, $56,595, and $56,473, respectively, that was included in the corresponding contract liability balance at the beginning of the periods presented.

The Company receives payments from clients based upon contractual billing schedules. The Company typically invoices its clients annually in advance for their annual software access fee. The Company records accounts receivable when the right to consideration becomes unconditional. Payment terms on invoiced amounts are typically net 30 days.

Deferred Revenue

Significant changes in the Company’s deferred revenue balance for the years ended December 31, 2023, 2022 and 2021:

|  | Years Ended December 31, |
|  | 2023 |  |  | 2022 |  |  | 2021 |
Total deferred revenue, beginning of the period |  | $ | 55,794 |  |  | $ | 75,896 |  |  | $ | 74,800 |
Additions |  |  | 124,091 |  |  |  | 106,330 |  |  |  | 123,717 |
Recognized |  |  | (127,429 | ) |  |  | (126,432 | ) |  |  | (122,621 | )
Total deferred revenue, end of the period |  | $ | 52,456 |  |  | $ | 55,794 |  |  | $ | 75,896 |
Current deferred revenue |  |  | 46,365 |  |  |  | 49,505 |  |  |  | 68,841 |
Non-current deferred revenue |  |  | 6,091 |  |  |  | 6,289 |  |  |  | 7,055 |
Total |  | $ | 52,456 |  |  | $ | 55,794 |  |  | $ | 75,896 |

Transaction Price Allocated to Remaining Performance Obligations

As of December 31, 2023 and 2022, the aggregate amount of the transaction price allocated to remaining performance obligations was $217,736 and $166,855, respectively. The substantial majority of the unsatisfied performance obligations will be satisfied over the next three years. As it pertains to the December 31, 2023 amount, the Company expects to recognize 49% of the transaction price in the year ending December 31, 2024 in its consolidated statement of operations and comprehensive loss with the remainder recognized thereafter.

4. Variable Interest Entities

The Company provides services pursuant to contracts with PCs which in turn contracts with physicians to provide virtual care medical services. The PC’s collectively represent the Company’s affiliated medical group. The PCs were designed and structured to comply with the relevant laws and regulations governing professional medical practice, which generally prohibits the practice of medicine by lay persons or entities. To satisfy these regulatory requirements, all of the issued and outstanding equity interests of the PCs are owned by a licensed medical professional nominated by the Company (the “Nominee Shareholder”). Upon formation of the PCs, and initial issuance of equity interests, the Nominee Shareholder contributes a nominal amount of capital in exchange for their interest in the PC. The Company then executes with each PC a Business Support Agreement (“BSA”), which provide for various administrative and management services to be provided by the Company to the PC, and a Stock Transfer Agreement (“STA”), which provide for transition of ownership of the PCs.

The Company provides all of the necessary capital for the operations of the PCs through loans to the PCs. The Company also has exclusive responsibility for the provision of all nonmedical services including contracting with clients who access the PCs for a medical visit, handling all financial transactions and day-to-day operations of each PC, overseeing the establishment of virtual care policies and protocol, and making recommendations to the PC in establishing the guidelines for the employment and compensation of the physicians and other employees of the PCs. In addition, the STA provides that the Company’s Board of Directors has the power and authority to change the Nominee Shareholder at any time for any reason, and designate a new Nominee Shareholder who will purchase the equity interests from the predecessor Nominee Shareholder for the same nominal amount, effectively limiting the Nominee Shareholder’s rights to returns of the PC. The Nominee Shareholders, notwithstanding their legal form of ownership of equity interests in the PC, have no substantive profit-sharing rights in the PCs.

Based upon the provisions of these agreements, the Company determined that the PCs are variable interest entities due to its equity holder having insufficient capital at risk, and the Company has a variable interest in the PCs. The Company consolidated the PCs under the VIE model since the Company has the power to direct activities that most significantly impact the PCs economic performance and the right to receive benefits or the obligation to absorb losses that could potentially be significant to the PCs.

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Furthermore, as a direct result of nominal initial equity contributions by the Nominee Shareholder, the financial support the Company provides to the PCs (e.g. loans) and the provisions of the STA, the interests held by noncontrolling interest holders lack economic substance and do not provide them with the ability to participate in the residual profits or losses generated by the PCs. Therefore, all income and expenses recognized by the PCs are allocated to the Company’s stockholders.

The aggregate carrying value of total assets and total liabilities included on the consolidated balance sheets for the PCs after elimination of intercompany transactions were $33,842 and $1,803, respectively, as of December 31, 2023 and $31,189 and $1,648, respectively as of December 31, 2022.

Total revenue included on the consolidated statements of operations and comprehensive loss for the PCs after elimination of intercompany transactions was $72,349, $74,389 and $72,125 for the years ended December 31, 2023, 2022 and 2021, respectively. Net loss included on the consolidated statements of operations and comprehensive was not material for the years ended December 31, 2023, 2022 and 2021.

5. National Telehealth Network

In 2012, the Company and an affiliate of Elevance Health, Inc. formed NTN to expand the availability and adoption of telemedicine. The Company did not have a controlling financial interest in NTN, but it had the ability to exercise significance influence over the operating and financial policies of NTN. Therefore, the Company accounted for its investment in NTN using the equity method of accounting through December 31, 2015.

On January 1, 2016, the Company made an additional investment in NTN, which increased its ownership percentage above 50%. The Company also obtained the right to elect the Chairman of NTN who has the ability to cast the tie-breaking vote in all decisions. Therefore, on January 1, 2016, the Company obtained control over NTN and has the power to direct the activities that most significantly impact NTN’s economic performance. This step-acquisition was accounted for as a business combination and the results of the operations of NTN from January 1, 2016, have been included in the Company’s consolidated financial statements. However, because the Company owns less than 100% of NTN, the Company recognizes net income (loss) attributable to non-controlling interest in the consolidated statements of operations and comprehensive loss equal to the percentage of the ownership interest retained in NTN by the respective non-controlling party.

The proportionate share of the loss attributed to the non-controlling interest amounted to $4,007, $1,643 and $448 for the years ended December 31, 2023, 2022 and 2021, respectively. The carrying value of the non-controlling interest was $15,967, $19,974 and $21,617 as of December 31, 2023, 2022 and 2021.

6. Fair Value Measurements

Certain assets and liabilities of the Company are carried at fair value under GAAP. Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Valuation techniques used to measure fair value must maximize the use of observable inputs and minimize the use of unobservable inputs. Financial assets and liabilities carried at fair value are to be classified and disclosed in one of the following three levels of the fair value hierarchy, of which the first two are considered observable and the last is considered unobservable:

•
Level 1—Quoted prices in active markets for identical assets or liabilities.
•
Level 2—Observable inputs (other than Level 1 quoted prices), such as quoted prices in active markets for similar assets or liabilities, quoted prices in markets that are not active for identical or similar assets or liabilities, or other inputs that are observable or can be corroborated by observable market data.
•
Level 3—Unobservable inputs that are supported by little or no market activity and that are significant to determining the fair value of the assets or liabilities, including pricing models, discounted cash flow methodologies and similar techniques.

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The following tables presents the Company’s fair value hierarchy for its assets and liabilities that are measured at fair value on a recurring basis and indicate the level within the fair value hierarchy of the valuation techniques the Company utilized to determine such fair value:

|  | December 31, 2023 |
|  | Level 1 |  |  | Level 2 |  |  | Level 3 |  |  | Total |
Money market funds |  | $ | 299,300 |  |  | $ | — |  |  | $ | — |  |  | $ | 299,300 |
Total financial assets: |  | $ | 299,300 |  |  | $ | — |  |  | $ | — |  |  | $ | 299,300 |

|  | December 31, 2022 |
|  | Level 1 |  |  | Level 2 |  |  | Level 3 |  |  | Total |
Money market funds |  | $ | 445,856 |  |  | $ | — |  |  | $ | — |  |  | $ | 445,856 |
Total financial assets: |  | $ | 445,856 |  |  | $ | — |  |  | $ | — |  |  | $ | 445,856 |

As of December 31, 2023 and 2022, the Company’s cash equivalents were invested in money market funds and were valued based on Level 1 inputs. During the years ended December 31, 2023 and 2022, there were no transfers between Level 1, Level 2 and Level 3.

The Company classified its net liability for contingent earnout considerations relating to the Acquisitions within Level 3 of the fair value hierarchy because the fair value is determined using significant unobservable inputs, which included the Monte Carlo method that uses key assumptions to model future revenue and costs of goods sold projections. A description of the Acquisitions is included within Note 8. The contingent earnout payments for each acquisition are based on the achievement of certain revenue and integration thresholds.

|  | Year Ended December 31, |
|  | 2023 |  |  | 2022 |
Beginning Balance as of January 1 |  | $ | — |  |  | $ | 16,450 |
Accretion of contingent consideration |  |  | — |  |  |  | 793 |
Earned amount issued to shareholders in Class A Common Stock |  |  | — |  |  |  | (17,243 | )
Ending Balance |  | $ | — |  |  | $ | — |

7. Allowance for Credit Losses

Changes in the allowance for credit losses were as follows:

|  | Years Ended December 31, |
|  | 2023 |  |  | 2022 |  |  | 2021 |
Allowance for credit losses, beginning of the period |  | $ | 1,884 |  |  | $ | 1,809 |  |  | $ | 1,556 |
Provisions |  |  | 1,034 |  |  |  | 803 |  |  |  | 714 |
Write-offs |  |  | (627 | ) |  |  | (728 | ) |  |  | (461 | )
Allowance for credit losses, end of the period |  | $ | 2,291 |  |  | $ | 1,884 |  |  | $ | 1,809 |

8. Business Combinations

On August 27, 2021, the Company completed the acquisition of SilverCloud through a merger in which SilverCloud became a wholly-owned subsidiary of the Company. The cash consideration paid was $105,195 net of cash acquired of $12,239. The stock consideration was comprised of 8.1 million shares of the Company’s Class A common stock valued at $85,571, and escrow share consideration of $6,376. SilverCloud is a leading digital mental health platform. The Company is obligated to pay an earn-out of up to $40,000 contingent upon SilverCloud achieving certain revenue thresholds for the year ending December 31, 2022. The Company estimated the fair value of the contingent consideration as of the acquisition date to be $29,360. The contingent consideration is subject to remeasurement at each reporting date until December 31, 2022, with the remeasurement adjustment reported in the consolidated statement of operations and comprehensive loss. The Company signed an amendment to the agreement accelerating the determination of the SilverCloud revenue earn-out as of May 11, 2022, which resulted in the issuance of 4,959,856 shares of Class A Common Stock. The acquisition was considered a stock acquisition for tax purposes and accordingly, the goodwill resulting from this acquisition is not tax deductible. The total acquisition related costs were $4,854 which included transaction costs from financial and legal advisors and other transaction

F-20

related fees and were recognized as incurred in the Company’s consolidated statement of operations and comprehensive loss in general and administrative expenses.

On August 9, 2021, the Company completed the acquisition of Conversa through a merger in which Conversa became a wholly-owned subsidiary of the Company. The cash consideration paid was $51,331 net of cash acquired of $9,735. The stock consideration was comprised of 4.7 million shares of the Company’s Class A common stock valued at $52,160. Conversa is a leader in automated virtual healthcare. The Company is obligated to pay an earn-out of up to $30,000 contingent upon Conversa achieving certain integration thresholds in the first quarter of 2022, and certain revenue thresholds for the year ending December 31, 2022. The Company estimated the fair value of the contingent consideration as of the acquisition date to be $15,230. The contingent consideration is subject to remeasurement at each reporting date until December 31, 2022, with the remeasurement adjustment reported in the consolidated statement of operations and comprehensive loss. The integration milestone was achieved in December 2021 and $15,000 was paid in January 2022. T he Company signed an amendment to the agreement accelerating the determination of the Conversa revenue earn-out as of March 31, 2022, which resulted in the issuance of 1,020,964 shares of Class A Common Stock. The acquisition was considered a stock acquisition for tax purposes and accordingly, the goodwill resulting from this acquisition is not tax deductible. The total acquisition related costs were $2,435 which included transaction costs from financial and legal advisors and other transaction related fees and were recognized as incurred in the Company’s consolidated statement of operations and comprehensive loss in general and administrative expenses.

The Acquisitions were accounted for using the acquisition method of accounting, which requires, among other things, the assets acquired and the liabilities assumed be recognized at their fair values as of the acquisition date. The results of the Acquisitions were integrated within the consolidated financial statements commencing on the aforementioned acquisition dates. Actual revenue and losses of the Acquisitions since the acquisition date as well as pro forma combined results of operations for the Acquisition have not been presented because the effect of the Acquisitions were not material to the Company’s consolidated financial results for the periods presented.

The following table summarizes the fair value estimates of the assets acquired and liabilities assumed for the SilverCloud and Conversa acquisitions at the respective acquisition dates. The Company, with the assistance of a third-party valuation expert, estimated the fair value of the acquired tangible and intangible assets with significant estimates such as revenue projections. In the year ended December 31, 2021, the Company recorded a $2,825 increase and a $1,268 decrease to goodwill related to the assessment of the tax attributes of the business combinations for SilverCloud and Conversa, respectively. In addition, the Company recorded a $9 and $66 decrease to goodwill with the finalization of the net working capital adjustment for SilverCloud and Conversa, respectively. In the third quarter of 2022, the Company recorded a $522 decrease in goodwill related to the assessment of the tax attributes of the business combination for SilverCloud. The allocation of the consideration transferred to the assets acquired and liabilities assumed for the Acquisitions is final.

Identifiable assets acquired and liabilities assumed:

|  | SilverCloud |  |  | Conversa Health |
Purchase consideration: |  |  |  |  |  |
Cash consideration, net of cash acquired |  | $ | 105,195 |  |  | $ | 51,331 |
Stock consideration |  |  | 85,571 |  |  |  | 52,160 |
Contingent consideration |  |  | 29,360 |  |  |  | 15,230 |
Escrow share consideration |  |  | 6,376 |  |  |  |
Working capital adjustment |  |  | (300 | ) |  |  | (127 | )
Total consideration transferred |  | $ | 226,202 |  |  | $ | 118,594 |
Allocation of Consideration transferred: |  |  |  |  |  |
Accounts receivable |  | $ | 2,630 |  |  | $ | 3,651 |
Identifiable intangible assets |  |  | 78,146 |  |  |  | 34,700 |
Other assets |  |  | 491 |  |  |  | 4,604 |
Total assets acquired |  |  | 81,267 |  |  |  | 42,955 |
Current liabilities |  |  | 2,155 |  |  |  | 8,463 |
Deferred revenue |  |  | 5,813 |  |  |  | 4,655 |
Other long-term liabilities |  |  | 11,035 |  |  |  | 115 |
Total liabilities assumed |  |  | 19,003 |  |  |  | 13,233 |
Goodwill |  | $ | 163,938 |  |  | $ | 88,872 |
|  | $ | 226,202 |  |  | $ | 118,594 |

F-21

The amount allocated to goodwill reflects the benefits the Company expects to realize from post-acquisition cross selling opportunities from integrating customer relationships and from the growth of the respective acquisitions’ operations.

The following are the identifiable intangible assets acquired in the Acquisitions and their respective weighted average useful lives, as determined based on initial valuations. The estimated fair value of the Technology and Tradename was determined using a relief from royalty method and the estimated fair value of the Customer relationships was determined using the excess earnings method:

|  | SilverCloud |  |  | Weighted Average Life (Years) |  |  | Conversa Health |  |  | Weighted Average Life (Years) |
Technology |  | $ | 34,996 |  |  |  | 5.0 |  |  | $ | 20,400 |  |  |  | 5.0 |
Tradename |  |  | 10,800 |  |  |  | 7.0 |  |  |  | 4,200 |  |  |  | 5.0 |
Customer relationships |  |  | 32,350 |  |  |  | 10.0 |  |  |  | 10,100 |  |  |  | 10.0 |
Total |  | $ | 78,146 |  |  |  |  |  | $ | 34,700 |  |  |  |

9. Deferred Contract Acquisition and Contract Fulfillment Costs

The following table represents a rollforward of the Company’s deferred contract acquisition costs:

|  | December 31, |
|  | 2023 |  |  | 2022 |
Beginning balance as of January 1 |  | $ | 4,788 |  |  | $ | 3,725 |
Additions to deferred contract acquisition costs |  |  | 4,511 |  |  |  | 2,768 |
Amortization of deferred contract acquisition costs |  |  | (2,266 | ) |  |  | (1,683 | )
Currency translation adjustments |  |  | 21 |  |  |  | (22 | )
Ending balance |  | $ | 7,054 |  |  | $ | 4,788 |
Deferred contract acquisition costs, current |  | $ | 2,262 |  |  | $ | 1,394 |
Deferred contract acquisition costs, noncurrent |  |  | 4,792 |  |  |  | 3,394 |
Total |  | $ | 7,054 |  |  | $ | 4,788 |

Amortization expense related to deferred contract acquisition costs for the years ended December 31, 2023, 2022 and 2021 was $2,266, $1,683 and $1,971, respectively.

The following table represents a rollforward of the Company’s deferred contract fulfillment costs:

|  | December 31, |
|  | 2023 |  |  | 2022 |
Beginning balance as of January 1 |  | $ | 1,281 |  |  | $ | 1,390 |
Additions to deferred contract fulfillment costs |  |  | 52 |  |  |  | 511 |
Amortization of deferred contract fulfillment costs |  |  | (432 | ) |  |  | (620 | )
Ending balance |  | $ | 901 |  |  | $ | 1,281 |
Deferred contract fulfillment costs, current |  | $ | 309 |  |  | $ | 620 |
Deferred contract fulfillment costs, noncurrent |  |  | 592 |  |  |  | 661 |
Total |  | $ | 901 |  |  | $ | 1,281 |

Amortization expense related to deferred contract fulfillment costs for the years ended December 31, 2023, 2022 and 2021 was $432, $620 and $737, respectively.

F-22

10. Property and Equipment, Net

Property and equipment, net consisted of the following:

|  | As of December 31, |
|  | 2023 |  |  | 2022 |
Furniture and fixtures |  | $ | 232 |  |  | $ | 231 |
Computer and office equipment |  |  | 7,322 |  |  |  | 7,216 |
Computer software |  |  | 5,125 |  |  |  | 5,041 |
Leasehold improvements |  |  | 692 |  |  |  | 692 |
|  |  | 13,371 |  |  |  | 13,180 |
Less: Accumulated depreciation and amortization |  |  | (12,799 | ) |  |  | (12,168 | )
Property and equipment, net |  | $ | 572 |  |  | $ | 1,012 |

Depreciation and amortization expense related to property and equipment was $631, $1,515 and $2,160 for the years ended December 31, 2023, 2022 and 2021, respectively. During the year ended December 31, 2022 the Company disposed of fully depreciated assets with a gross value of $1,139.

11. Goodwill and Intangible Assets

Goodwill consisted of the following as of:

|  | December 31, |
|  | 2023 |  |  | 2022 |
Beginning Balance as of January 1 |  | $ | 435,279 |  |  | $ | 442,761 |
Purchase accounting adjustment |  |  | — |  |  |  | (522 | )
Goodwill Impairment |  |  | (436,479 | ) |  |  | — |
Currency translation adjustments |  |  | 1,200 |  |  |  | (6,960 | )
Ending Balance |  | $ | — |  |  | $ | 435,279 |

In the third quarter of 2023, the Company experienced a triggering event, due to sustained decreases in the Company's publicly quoted share price and market capitalization, prompting impairment assessments of goodwill and long-lived assets including definite-lived intangibles. As such, the Company assessed the definite-lived intangible assets or other long-lived assets for impairment by performing an undiscounted cash flow analysis to establish fair value. The significant estimates used in fair value methodology, which are based on Level 3 inputs, include the Company's expectations for future operations and projected cash flows, including revenue, gross margin and operating expenses. The assessment did not result in an impairment of definite-lived intangible assets or other long-lived assets, as they passed the recoverability test. No triggering events were identified in the fourth quarter of 2023.

The Company also identified indicators of goodwill impairment for the single reporting unit which required an interim goodwill impairment assessment in each of the three quarters. In performing the quantitative assessment of goodwill, our reporting unit’s carrying amount exceeded its fair value. The Company estimated the reporting unit's fair value based on its market capitalization and a related control premium of 30% (amount paid by a new controlling shareholder for the benefits resulting from synergies and other potential benefits derived from controlling the acquired company). The Company evaluates the implied control premium or discount by comparing it to control premiums or discounts of recent comparable market transactions, as applicable. As a result of the interim quantitative impairment assessments, the Company recorded $436,479 non-deductible, of non-cash goodwill impairment charges for the year ended December 31, 2023. The goodwill balance as of December 31, 2023 is $0.

F-23

Identified intangible assets consisted of the following as of:

|  | Gross Amount |  |  | Accumulated Amortization |  |  | Carrying Value |  |  | Weighted Average Remaining Life |
December 31, 2023 |  |  |  |  |  |  |  |  |  |  |  |
Customer relationships |  | $ | 80,558 |  |  | $ | (33,109 | ) |  |  | 47,449 |  |  |  | 6.5 |
Contractor relationships |  |  | 535 |  |  |  | (329 | ) |  |  | 206 |  |  |  | 5.0 |
Trade name |  |  | 14,303 |  |  |  | (5,389 | ) |  |  | 8,914 |  |  |  | 4.1 |
Technology |  |  | 90,204 |  |  |  | (45,482 | ) |  |  | 44,722 |  |  |  | 3.3 |
Internally developed software |  |  | 25,210 |  |  |  | (6,253 | ) |  |  | 18,957 |  |  |  | 2.4 |
|  | $ | 210,810 |  |  | $ | (90,562 | ) |  | $ | 120,248 |  |  |  |
|  | Gross Amount |  |  | Accumulated Amortization |  |  | Carrying Value |  |  | Weighted Average Remaining Life |
December 31, 2022 |  |  |  |  |  |  |  |  |  |  |  |
Customer relationships |  | $ | 80,168 |  |  | $ | (24,919 | ) |  | $ | 55,249 |  |  |  | 7.4 |
Contractor relationships |  |  | 535 |  |  |  | (288 | ) |  |  | 247 |  |  |  | 6.0 |
Trade name |  |  | 14,012 |  |  |  | (3,050 | ) |  |  | 10,962 |  |  |  | 5.0 |
Technology |  |  | 89,262 |  |  |  | (30,895 | ) |  |  | 58,367 |  |  |  | 4.2 |
Internally developed software |  |  | 10,155 |  |  |  | — |  |  |  | 10,155 |  |  |  | 3.0 |
|  | $ | 194,132 |  |  | $ | (59,152 | ) |  | $ | 134,980 |  |  |  |

The Company capitalized $15,056 of costs during the year ended December 31, 2023, related to internally developed software to be sold as a service incurred during the application development stage and is amortizing these costs over the expected lives of the related technology. Amortization expense related to intangible assets for the years ended December 31, 2023, 2022 and 2021 was $30,861, $24,638 and $13,929, respectively.

Estimated future amortization expense of the identified intangible assets as of December 31, 2023, is as follows:

2024 | $ | 33,007 |
2025 | $ | 32,991 |
2026 | $ | 22,459 |
2027 | $ | 11,603 |
2028 | $ | 9,112 |
Thereafter |  | 11,076 |
|  | 120,248 |

12. Accrued Expenses

Accrued expenses consist of the following:

|  | As of December 31, |
|  | 2023 |  |  | 2022 |
Employee compensation and benefits |  | $ | 15,573 |  |  | $ | 26,192 |
Professional services |  |  | 3,838 |  |  |  | 10,190 |
Provider services |  |  | 7,437 |  |  |  | 8,096 |
Other |  |  | 12,140 |  |  |  | 9,780 |
Total |  | $ | 38,988 |  |  | $ | 54,258 |

F-24

13. Stockholders’ Equity

Undesignated Preferred Stock

In connection with our IPO in September 2020, we filed an Amended and Restated Certificate of Incorporation which authorizes the issuance of 100,000,000 shares of undesignated preferred stock, par value of $0.01 per share, with rights and preferences, including voting rights, designated from time to time by our board of directors. No shares of preferred stock were issued or outstanding as of December 31, 2023 and December 31, 2022.

Common Stock

In connection with the IPO, the Company filed an Amended and Restated Certificate of Incorporation which authorizes capital stock of 1,000,000,000 shares of Class A common stock, par value $0.01 per share, 100,000,000 shares of Class B common stock, par value $0.01 per share, and 200,000,000 shares of Class C common stock, par value $0.01 per share. Except for the rights noted below, each Class A, Class B and Class C common stock have the same rights, are equal in all respects and are treated by us as one class of shares. Each share of Class A and Class C common stock is entitled to one vote per share on all matters presented for a vote, except that Class C common stock does not have the right to vote for elections of directors. Subject to certain conditions, Class B common stock is collectively entitled to a number of votes equal to the product of (x) 1.0408163 and (y) the total number of votes that would be cast at such time by the holders of the Class A and Class C common stock and any other preferred stock entitled to vote under the certificate of incorporation at such time (resulting in the Class B common stock collectively holding 51% of the total outstanding voting power), and each share of Class B common stock will be entitled to a number of votes equal to the total number of votes held by all Class B common stock divided by the total number of then outstanding shares of Class B common stock. Shares of Class B and Class C common stock will be converted into shares of Class A common stock on a one-for-one basis upon the occurrence of certain events. Shares of Class B common stock will automatically convert on the first business day (i) after the date on which the outstanding shares of Class B common stock constitutes less than 5% of the aggregate number of shares of common stock then outstanding, (ii) after the date on which neither founder is serving as an executive officer or (iii) following seven years after the date the amended and restate certificate of incorporation becomes effective, provided that, such period may, to the extent permitted by law and applicable stock exchange rules, be extended for three years upon the affirmative vote of the holders of a majority of the voting power of the then-outstanding shares of Class A common stock entitled to vote thereon, voting separately as a class. Shares of Class C common stock will be convertible at the option of the holder upon determination that a Hart-Scott-Rodino Antitrust Improvements Act (“HSR”) filing is not necessary prior to the holder’s conversion of such shares or, if required, upon expiration or termination of the HSR waiting period.

Common stockholders are entitled to receive dividends, as may be declared by the board of directors, if any, subject to the preferential dividend right of the preferred stockholders. No dividends have been declared through December 31, 2023.

In August 2021, the Company issued 4.7 million and 8.1 million shares of Class A common stock at a fair value of $11.20 and $10.51 per share in connection with the acquisitions of Conversa and SilverCloud, respectively (see Note 8). In the year ended December 31, 2022 the Company issued 1.0 million and 5.0 million shares of Class A common stock at a fair value of $4.21 and $2.61 per share in connection with the settlement of the earnouts for Conversa and SilverCloud, respectively (see Note 6). In the year ended December 31, 2022 the Company also issued 0.6 million shares of Class A common stock in relation to the early settlement of the bonus escrow.

In the year ended December 31, 2023 no shares of Class B common stock were converted to Class A common stock. As of December 31, 2023 the par value of the Class A, Class B and Class C shares was $2,548, $275 and $56, respectively.

|  | Shares Authorized |  |  | Shares Issued |  |  | Shares Outstanding |
Class A |  |  | 1,000,000,000 |  |  |  | 255,542,545 |  |  |  | 255,542,545 |
Class B |  |  | 100,000,000 |  |  |  | 27,390,397 |  |  |  | 27,390,397 |
Class C |  |  | 200,000,000 |  |  |  | 5,555,555 |  |  |  | 5,555,555 |
|  |  | 1,300,000,000 |  |  |  | 288,488,497 |  |  |  | 288,488,497 |

As of December 31, 2023 and 2022, the Company had reserved 74,506,099 and 68,617,245 shares of common stock for the exercise of outstanding stock options, the vesting of restricted stock units and the number of shares remaining available for future grant, respectively.

F-25

Stock Plans and Stock Options

The Company maintains the 2006 Employee, Director and Consultant Stock Plan as amended and restated (the “2006 Plan”) and 2020 Equity Incentive Plan (the “2020 Plan” together, the “Plans”) under which it has granted incentive stock options, non-qualified stock options, and restricted stock units to employees, officers, and directors of the Company. In connection with the adoption of the 2020 Plan, the then-remaining shares of common stock reserved for grant or issuance under the 2006 Plan became available for issuance under the 2020 Plan, and no further grants will be made under the 2006 Plan. The 2020 Plan is administered by the board of directors with respect to awards to non-employee directors and by the compensation committee, with respect to other participants, are collectively, referred to as the plan administrator. The exercise prices, vesting and other restrictions are determined at the discretion of the plan administrator. Options issued under the Plans are exercisable for periods not to exceed ten years, and vest and contain such other terms and conditions as specified in the applicable award document. Options to buy common stock are issued under the Plans, with exercise prices equal to the closing price of shares of the Company’s common stock on the New York Stock Exchange on the date of award. Stock options granted under the Plan typically vest over four years and expire ten years after the grant date. The Company had 8,454,180 shares available for grant as of December 31, 2023.

Activity under the Plans is as follows:

|  | Number of Shares |  |  | Weighted Average Exercise Price |  |  | Weighted Average Remaining Contractual Term (Years) |  |  | Aggregate Intrinsic Value |
Outstanding as of January 1, 2023 |  |  | 11,039,551 |  |  | $ | 5.23 |  |  |  | 5.5 |  |  | $ | 996 |
Granted |  |  | — |  |  | $ | — |  |  |  |  |  |  |
Forfeited |  |  | (757,743 | ) |  | $ | 5.44 |  |  |  |  |  |  |
Expired |  |  | (6,160 | ) |  | $ | 1.77 |  |  |  |  |  |  |
Exercised |  |  | (286,599 | ) |  | $ | 1.99 |  |  |  |  |  |  |
Outstanding as of December 31, 2023 |  |  | 9,989,049 |  |  | $ | 5.09 |  |  |  | 4.6 |  |  | $ | — |
Vested and expected to vest as of December 31, 2023 |  |  | 9,978,545 |  |  | $ | 5.09 |  |  |  | 4.6 |  |  | $ | — |
Options exercisable as of December 31, 2023 |  |  | 9,906,925 |  |  | $ | 5.08 |  |  |  | 4.6 |  |  | $ | — |

The aggregate intrinsic value of stock options exercised during the years ended December 31, 2023, 2022 and 2021, was $206, $5,167 and $106,407, respectively. The aggregate intrinsic value of common stock options is calculated as the difference between the exercise price of the stock options and the fair value of the Company’s common stock for those stock options that had exercise prices lower than the fair value of the Company’s common stock.

There were no options granted during the years ended December 31, 2023, 2022 and2021.

The Company received cash proceeds from the exercise of common stock options of $569, $5,740 and $20,806 during the years ended December 31, 2023, 2022 and 2021, respectively.

Restricted Stock Units

The following table summarizes the unvested restricted stock unit activity for the year ended December 31, 2023:

|  | Shares |  |  | Weighted Average Grant Date Fair Value |
Unvested as of January 1, 2023 |  |  | 19,316,459 |  |  | $ | 10.78 |
Granted |  |  | 15,980,943 |  |  |  | 2.47 |
Vested |  |  | (8,956,584 | ) |  |  | 7.16 |
Forfeited |  |  | (3,917,923 | ) |  |  | 4.22 |
Unvested as of December 31, 2023 |  |  | 22,422,895 |  |  | $ | 7.45 |

The total grant date fair value of RSU’s granted for the years ended December 31, 2023, 2022 and 2021 was $39,419, $63,987 and $152,550, respectively. The aggregate intrinsic value of restricted stock units vested for the years ended December 31, 2023, 2022 and 2021 was $18,773, $22,218 and $90,726, respectively.

F-26

Restricted Stock Units with a Market Condition

In the year ended December 31, 2023 the Company granted performance-based market condition share awards to certain members of the Company’s management team (excluding the co-CEOs), which entitle these employees with the right to receive shares of common stock upon achievement of certain stock price milestones measured over a rolling thirty day trading-period, subject to the satisfaction of the applicable service vesting conditions. These performance-based market condition share awards consist of three tranches with three separate specified award values t hat become payable upon the achievement of certain stock price milestones, which can result in a vesting range of up to 2,654,598 shares. These performance-based market condition share awards have a performance period of three years.

As of December 31, 2023, 1,146,310 of the performance-based market condition share awards granted in the prior year have satisfied both the applicable market capitalization milestones and the service vesting conditions. None of the performance-based market condition share awards granted in 2023 have vested.

The total grant-date fair value of performance-based market condition share awards granted during the year ended December 31, 2023 and 2022 was $5,805 and $63,157, respectively. No performance-based market condition share awards were granted during the year ended December 31, 2021.

|  | Shares |  |  | Weighted Average Grant Date Fair Value |
Unvested as of January 1, 2023 |  |  | 25,602,405 |  |  | $ | 2.30 |
Granted |  |  | 2,654,598 |  |  |  | 2.19 |
Vested |  |  | (1,146,310 | ) |  |  | 2.12 |
Cancelled/Forfeited |  |  | (394,387 | ) |  |  | 2.41 |
Unvested as of December 31, 2023 |  |  | 26,716,306 |  |  | $ | 2.29 |

The weighted average estimated fair value of the performance-based market condition share awards granted during the year ended December 31, 2023 and December 31, 2022 was determined using a Monte-Carlo valuation simulation, with the following most significant weighted-average assumptions:

|  | Years Ended December 31,
|  | 2023 |  |  | 2022 |  |  | 2021
Risk-free rate |  |  | 4.61 | % |  |  | 2.34 | % |  | N/A
Term to end of performance period (yrs) |  | 3 years |  |  | 3 years |  |  | N/A
Weighted average valuation date stock price |  | $ | 2.76 |  |  | $ | 3.50 |  |  | N/A
Expected volatility |  |  | 70 | % |  |  | 75 | % |  | N/A
Expected dividend yield |  |  | 0 | % |  |  | 0 | % |  | N/A

2020 Employee Stock Purchase Plan

In July and August 2020, the Company’s board of directors adopted, and the Company’s stockholders approved, the 2020 Employee Stock Purchase Plan (“ESPP”). Rights granted under the ESPP will be issued only with respect to shares of Class A common stock. The purchase price of the shares will not be less than 85% of the fair market value of Class A common stock on the lower of the purchase date, which will be the final trading day of the purchase period, or the enrollment date, which will be the first trading day of the offering period.

F-27

During the years ended December 31, 2023, 2022 and 2021 the Company issued 1,224,312, 703,148 and 178,021 shares under the ESPP. As of December 31, 2023 6,923,669 shares remained available for issuance.

Stock-Based Compensation

Stock-based compensation expense was classified in the consolidated statements of operations and comprehensive loss as follows:

|  | Years Ended December 31, |
|  | 2023 |  |  | 2022 |  |  | 2021 |
Cost of revenues |  | $ | 1,681 |  |  | $ | 1,605 |  |  | $ | 1,655 |
Research and development |  |  | 10,348 |  |  |  | 10,236 |  |  |  | 7,613 |
Selling and marketing |  |  | 8,613 |  |  |  | 7,182 |  |  |  | 7,666 |
General and administrative |  |  | 51,398 |  |  |  | 50,121 |  |  |  | 26,875 |
Total |  | $ | 72,040 |  |  | $ | 69,144 |  |  | $ | 43,809 |

As of December 31, 2023, total unrecognized compensation cost related to the unvested common stock-based awards was $65,125, which is expected to be recognized over a weighted-average period of 2.2 years.

14. Commitments and Contingencies

Leases

The Company’s primary lease represents the lease for its corporate headquarters in Boston, Massachusetts. The Company modified the corporate headquarter lease during the third quarter of 2021. Rent expense for the year ended December 31, 2023 was $4,292. The carrying value of the Company’s right-of-use assets are substantially concentrated in real estate as the Company primarily leases office space. The Company’s policy is not to record leases with an original lease term of one year or less on the consolidated balance sheets. The Company recognizes lease expense for these short-term leases on a straight-line basis over the lease term. The Company does not have any lease contracts with the option to purchase as of December 31, 2023.

|  | Years Ended December 31, |
|  | 2023 |  |  | 2022 |  |  | 2021 |
The components of lease cost under ASC 842 were as follows: |  |  |  |  |  |  |  |  |
Operating lease cost |  | $ | 3,495 |  |  | $ | 3,694 |  |  | $ | 5,617 |
Short-term lease cost |  |  | — |  |  |  | — |  |  |  | — |
Variable lease cost |  |  | — |  |  |  | — |  |  |  | — |
Total lease cost |  | $ | 3,495 |  |  | $ | 3,694 |  |  | $ | 5,617 |

|  | Years Ended December 31, |
|  | 2023 |  |  | 2022 |  |  | 2021 |
Supplemental cash flow information: |  |  |  |  |  |  |  |  |
Cash paid for amounts included in measurement of lease liabilities: |  |  |  |  |  |  |  |  |
Operating cash flows from operating leases |  | $ | 3,527 |  |  | $ | 2,672 |  |  | $ | 6,352 |
Non-cash lease activity: |  |  |  |  |  |  |  |  |
Right-of-use lease assets obtained in exchange for new operating lease liability: |  |  |  |  |  |  |  |  |
Operating leases |  | $ | 0 |  |  | $ | 851 |  |  | $ | 15,506 |

F-28

|  | As of December 31, |
|  | 2023 |  |  | 2022 |
Supplemental balance sheet information related to leases is as follows: |  |  |  |  |  |
Operating leases |  |  |  |  |  |
Operating lease right-of-use assets |  | $ | 10,453 |  |  | $ | 13,509 |
Total operating right-of-use lease assets |  | $ | 10,453 |  |  | $ | 13,509 |
Operating lease liabilities, current |  |  | 3,580 |  |  |  | 3,057 |
Operating lease liabilities, net of current portion |  |  | 8,206 |  |  |  | 11,787 |
Total operating lease liabilities |  | $ | 11,786 |  |  | $ | 14,844 |
Weighted-average remaining lease term (in years) |  | 3.2 years |  |  | 4.1 years |
Weighted-average discount rate |  |  | 1.2 | % |  |  | 1.3 | %

As of December 31, 2023, minimum future lease payments for these operating leases were as follows:

Years ending December 31, |  |  |
2024 |  | $ | 3,698 |
2025 |  |  | 3,766 |
2026 |  |  | 3,649 |
2027 |  |  | 893 |
2028 |  |  | — |
Thereafter |  |  | — |
Total lease payments |  | $ | 12,006 |
Less imputed interest |  |  | (220 | )
Total present value of lease liabilities |  | $ | 11,786 |

Indemnification

The Company’s arrangements generally include certain provisions for indemnifying clients against third-party claims asserting infringement of certain intellectual property rights in the ordinary course of business. The Company also regularly indemnifies clients against third-party claims that the company’s products or services breach applicable law or regulation or from claims resulting from a breach of the business associate agreement in place with the client. In addition, the Company indemnifies its officers, directors and certain key employees while they are serving in good faith in their capacities. Through December 31, 2023, there have been no claims under any indemnification provisions.

Litigation

From time to time, and in the ordinary course of business, the Company may be subject to various claims, charges, and litigation. On September 14, 2020, the Company received a letter from Teladoc Health, Inc. alleging that certain of the Company’s cart products and associated peripherals infringe upon their patents. On October 12, 2020, Teladoc Health, Inc filed a claim against the Company related to these allegations. On June 30, 2022, the claim was dismissed pursuant to a confidential settlement between the parties. As of December 31, 2023 and 2022, the Company did no t have any pending claims, charges or litigation that it expects would have a material adverse effect on its consolidated financial position, results of operations or cash flows.

15. Income Taxes

During the years ended December 31, 2023, 2022 and 2021 the Company recorded an income tax (expense) benefit of $(3,860), $(64) and $5,376, respectively. The December 31, 2023 income tax provision is primarily due to foreign income taxes in Israel. The December 31, 2022 income tax provision is primarily due to foreign income taxes in Israel partially offset by losses in Ireland. The December 31, 2021 income tax benefit is primarily due to a partial release of valuation allowance in the U.S. resulting from the deferred tax liabilities established as part of the Acquisitions consummated during the year (see Note 8).

For the years ended December 31, 2023, 2022 and 2021, the Company’s loss before income taxes is primarily generated in the United States as the pre-tax loss from the Company’s foreign subsidiaries is not significant.

F-29

The components of our current and deferred portions of the provision for income taxes are presented in the table below:

|  | Years Ended December 31, |
|  | 2023 |  |  | 2022 |  |  | 2021 |
Current income tax (provision) benefit: |  |  |  |  |  |  |  |  |
Federal |  | $ | (237 | ) |  | $ | — |  |  | $ | — |
State |  |  | (167 | ) |  |  | (22 | ) |  |  | (41 | )
Foreign |  |  | (3,614 | ) |  |  | (3,256 | ) |  |  | (828 | )
Total Current |  | $ | (4,018 | ) |  | $ | (3,278 | ) |  | $ | (869 | )
Deferred income tax (provision) benefit: |  |  |  |  |  |  |  |  |
Federal |  | $ | — |  |  | $ | — |  |  | $ | 5,730 |
State |  |  | — |  |  |  | — |  |  |  | (1 | )
Foreign |  |  | 158 |  |  |  | 3,214 |  |  |  | 516 |
Total Deferred |  | $ | 158 |  |  | $ | 3,214 |  |  | $ | 6,245 |
Total (provision) benefit for income taxes |  | $ | (3,860 | ) |  | $ | (64 | ) |  | $ | 5,376 |

The following reconciles the differences between income taxes computed at the federal statutory rate and the provision for income taxes:

|  | Years Ended December 31, |
|  | 2023 |  |  | 2022 |  |  | 2021 |
Federal statutory income tax rate |  |  | 21.0 | % |  |  | 21.0 | % |  |  | 21.0 | %
State taxes, net of federal benefit |  |  | 1.1 |  |  |  | 3.7 |  |  |  | 4.5 |
Valuation allowance |  |  | (7.1 | ) |  |  | (18.5 | ) |  |  | (24.5 | )
Stock-based compensation |  |  | (1.3 | ) |  |  | (5.1 | ) |  |  | 1.9 |
Permanent differences |  |  | (14.0 | ) |  |  | (0.7 | ) |  |  | — |
Other |  |  | (0.3 | ) |  |  | (0.4 | ) |  |  | 0.1 |
Effective income tax rate |  |  | (0.6 | )% |  |  | — | % |  |  | 3.0 | %

Deferred tax assets and liabilities reflect the net tax effects of net operating loss and tax credit carryforwards and temporary differences between the carrying amount of assets and liabilities for financial reporting and the amounts used for tax purposes. Significant components of the Company's deferred tax assets and liabilities were as follows:

|  | As of December 31, |
|  | 2023 |  |  | 2022 |
Deferred tax assets: |  |  |  |  |  |
Net operating loss carryforwards |  | $ | 229,264 |  |  | $ | 201,495 |
Research and development credit carryforwards |  |  | 1,660 |  |  |  | 1,603 |
Deferred revenue |  |  | 2,687 |  |  |  | 3,395 |
Deferred compensation |  |  | 5,687 |  |  |  | 7,590 |
Leasing obligation |  |  | 3,087 |  |  |  | 3,932 |
Capitalized research expense |  |  | 43,476 |  |  |  | 27,147 |
Other |  |  | 2,415 |  |  |  | 1,224 |
Total deferred tax assets |  |  | 288,276 |  |  |  | 246,386 |
Total valuation allowance |  |  | 263,001 |  |  |  | 214,776 |
Total net deferred tax assets |  |  | 25,275 |  |  |  | 31,610 |
Joint venture investment basis difference |  |  | (1,054 | ) |  |  | (1,321 | )
Intangibles |  |  | (20,879 | ) |  |  | (26,672 | )
Right-of-use assets |  |  | (2,738 | ) |  |  | (3,578 | )
Other |  |  | (1,902 | ) |  |  | (1,499 | )
Total deferred tax assets (liabilities) |  |  | (26,573 | ) |  |  | (33,070 | )
Net deferred tax liabilities |  | $ | (1,298 | ) |  | $ | (1,460 | )

The Company has evaluated the positive and negative evidence bearing upon its ability to realize the deferred tax assets. Management has considered the Company's history of cumulative net losses incurred in the U.S. since inception and has concluded that it is more likely than not that the Company will not realize the benefits of the deferred tax assets. Accordingly, a full valuation allowance has been established against the net domestic deferred tax assets as of December 31, 2023, 2022 and 2021. Management reevaluates the positive and negative evidence at each reporting period.

F-30

Changes in the valuation allowance for deferred tax assets during the years ended December 31, 2023, 2022 and 2021 related primarily to the increase in net operating loss carryforwards in 2023, 2022 and 2021 and were as follows:

|  | Years Ended December 31, |
|  | 2023 |  |  | 2022 |  |  | 2021 |
Valuation allowance as of beginning of the year |  | $ | 214,776 |  |  | $ | 164,391 |  |  | $ | 118,795 |
Increases recorded to income tax provision |  |  | 48,225 |  |  |  | 50,403 |  |  |  | 51,348 |
Decreases recorded as a benefit to income tax provision |  |  | — |  |  |  | (18 | ) |  |  | (5,752 | )
Valuation allowance as of end of year |  | $ | 263,001 |  |  | $ | 214,776 |  |  | $ | 164,391 |

As of December 31, 2023, the Company has federal net operating loss carryforwards of approximately $865,981, which begin to expire in 2026. The Company’s federal net operating losses generated for the years ended after December 31, 2017, which amounted to a total of $636,756, can be carried forward indefinitely. The Company has tax effected state net operating losses of approximately $41,847, which began to expire in 2024. In addition, the Company has federal and state research and development tax credit carryforwards of $1,602 and $58, which begin to expire in 2027 and 2035, respectively.

Utilization of the Company's net operating loss ("NOL") carryforwards and research and development ("R&D") credit carryforwards may be subject to a substantial annual limitation due to ownership change limitations that have occurred previously or that could occur in the future in accordance with Section 382 of the Internal Revenue Code of 1986 ("Section 382") as well as similar state provisions. These ownership changes may limit the amount of NOL and R&D credit carryforwards that can be utilized annually to offset future taxable income and taxes, respectively. In general, an ownership change as defined by Section 382 results from transactions increasing the ownership of certain shareholders or public groups in the stock of a corporation by more than 50% over a three-year period. Since its formation, the Company has raised capital through the issuance of capital stock on several occasions. These financings, combined with the purchasing shareholders' subsequent disposition of those shares, could result in a change of control as defined by Section 382. The Company conducted an analysis under Section 382 to determine if historical changes in ownership through December 31, 2021 would limit or otherwise restrict its ability to utilize its NOL and R&D credit carryforwards. As a result of this analysis, it was determined that $1,680 federal and $6,391 state net operating loss carryforwards generated through December 31, 2021 will expire unused. However, changes in ownership occurring after December 31, 2021, could affect the limitation in future years, and any limitation may result in expiration of a portion of the NOL or R&D credit carryforwards before utilization.

The Company does no t have unrecognized tax benefits related to uncertain tax positions. The Company recognizes both accrued interest and penalties related to unrecognized tax benefits in income tax expense. The Company has not recorded any interest and penalties on any unrecognized tax benefits since its inception. The tax years 2006 through 2023 remain open to examination by major taxing jurisdictions to which the Company is subject, which is primarily in the United States (U.S.), as carryforward attributes generated in prior years may still be adjusted upon examination by the Internal Revenue Service (IRS) or state tax authorities if they have or will be used in a future period. The Company files income tax returns in the U.S. federal and various state jurisdictions. There are currently no federal or state audits in progress by the IRS or any other jurisdictions for any tax years.

16. Related-Party Transactions

Teva Pharmaceuticals, Industries Ltd

Teva Pharmaceuticals, Industries Ltd (“Teva”) was determined to be a related party because a member of the Company’s board of directors was the President and CFO of Teva Pharmaceuticals’ North America Commercial through June 2021. In addition, Teva was a non-significant shareholder of the Company during the year.

Prior to the board member’s departure from the board of directors in June 2021, the Company recognized an immaterial amount of revenue from contracts with this client.

Philips Holding USA, Inc.

Philips Holding USA, Inc. (“Philips”) was determined to be a related party because a member of the Company’s board of directors was the Business Leader of Philips Population Health Management through June 2021. In addition, Philips is a non-significant shareholder of the Company. As of September 30, 2021, it was determined Philips was no longer a related party.

F-31

Prior to the board member’s departure from Philips in June 2021, the Company recognized revenue of $1,658, from contracts with this client.

Elevance Health Inc. (formerly Anthem)

Elevance Health Inc. (“Elevance”) was determined to be a related party because a member of the Company’s board of directors served as the Vice President of Elevance through February 2021. In addition, Elevance is a non-significant shareholder of the Company. As of March 31, 2021, it was determined Elevance was no longer a related party.

Prior to the board member’s departure from Elevance in February 2021, the Company recognized revenue of $7,218 from contracts with this client.

Cleveland Clinic

Cleveland Clinic is a related party because a member of the Company’s board of directors is an executive advisor to Cleveland Clinic. As of December 31, 2023 and 2022, the Company held short-term deferred revenue of $43 and $355, respectively from contracts with this client. As of December 31, 2023 and 2022, amounts due from Cleveland Clinic were $24 and $995.

During the years ended December 31, 2023, 2022 and 2021, the Company recognized revenue of $2,283, $2,803 and $1,301, respectively, from contracts with this client.

CCAW, JV LLC

CCAW, JV LLC is a related party because it is a joint venture formed between the Company and Cleveland Clinic for which the Company has a less than majority owned interest in. During the year ended December 31, 2020 the Company made an initial investment in CCAW, JV LLC of $2,940 for its less than 50% interest in the joint venture. During the years ended December 31, 2023 and 2022 the Company made a capital contributed of $3,920 and $1,960, related to a portion of the phase one capital commitment.

During the year ended December 31, 2023, 2022 and 2021, the Company recognized revenue of $1,576, $1,741 and $1,841 from contracts with this client. As of December 31, 2023 and 2022, the Company held short and long term deferred revenue of $1,243 and $1,320 from contracts with this client. As of December 31, 2023 and 2022 amounts due from CCAW, JV LLC were $1,602 and $1,602, respectively.

17. Employee Benefit Plan

The Company has established a defined contribution savings plan under Section 401(k) of the Internal Revenue Code. This plan covers substantially all employees who meet minimum age and service requirements and allows participants to defer a portion of their annual compensation on a pretax basis, subject to legal limitations. Company contributions to the plan may be made at the discretion of the Company’s board of directors. The Company contributed a total of $3,639, $3,363 and $2,698 to the plan for the years ended December 31, 2023, 2022 and 2021, respectively.

18. Net Loss per Share

Basic and diluted net loss per share attributable to common stockholders was calculated as follows:

|  | Years Ended December 31, |
|  | 2023 |  |  | 2022 |  |  | 2021 |
Numerator: |  |  |  |  |  |  |  |  |
Net loss |  | $ | (679,171 | ) |  | $ | (272,072 | ) |  | $ | (176,782 | )
Net loss attributable to non-controlling interest |  |  | (4,007 | ) |  |  | (1,643 | ) |  |  | (448 | )
Net loss attributable to American Well Corporation |  | $ | (675,164 | ) |  | $ | (270,429 | ) |  | $ | (176,334 | )
Denominator: |  |  |  |  |  |  |  |  |
Weighted-average common shares outstanding, basic and diluted |  |  | 284,256,743 |  |  |  | 274,249,749 |  |  |  | 254,068,942 |
Net loss per share attributable to common stockholders, basic and diluted |  | $ | (2.38 | ) |  | $ | (0.99 | ) |  | $ | (0.69 | )

F-32

The Company’s potential dilutive securities, which include stock options, convertible preferred stock and unvested restricted stock units, have been excluded from the computation of diluted net loss per share as the effect would be to reduce the net loss per share. Therefore, the weighted-average number of common shares outstanding used to calculate both basic and diluted net loss per share attributable to common stockholders is the same. The Company excluded the following potential common shares equivalents presented based on amounts outstanding at each period end, from the computation of diluted net loss per share attributable to common stockholders for the periods indicated because including them would have had an anti-dilutive effect:

|  | Years Ended December 31, |
|  | 2023 |  |  | 2022 |  |  | 2021 |
Unvested restricted stock units |  |  | 22,422,895 |  |  |  | 16,178,486 |  |  |  | 7,472,787 |
Unvested performance market-based stock units |  |  | 26,716,306 |  |  |  | 25,602,405 |  |  |  | — |
Options to purchase shares of common stock |  |  | 9,989,049 |  |  |  | 11,039,551 |  |  |  | 15,893,755 |
|  |  | 59,128,250 |  |  |  | 52,820,442 |  |  |  | 23,366,542 |

F-33