SAN FRANCISCO, May 7, 2020 /PRNewswire/ -- Castlight
Health, Inc. (NYSE:CSLT), a leading health benefits platform
provider, today announced results for its first quarter ended
March 31, 2020.
"We delivered solid financial results and made progress in
executing against our strategic plan in the first quarter. In the
face of COVID-19, our team responded swiftly with innovative
thinking and nimble execution to support our customers, users and
the broader community. Given the economic downturn triggered by
COVID-19, we took swift and proactive measures to reduce costs and
protect our balance sheet. We believe the market's need for
navigation will only accelerate, and we are uniquely well
positioned to leverage our core technology to meet the needs of our
customers as we return to a new normal," said Maeve O'Meara, chief executive officer at
Castlight Health.
Financial performance for the three months ended March 31,
2020 compared to the three months ended March 31, 2019
includes:
- GAAP total revenue of $39.0
million, compared to $35.5
million
- GAAP gross margin of 62.9%, compared to 60.2%
- Non-GAAP gross margin of 65.1%, compared to 63.3%
- GAAP operating loss of $56.6
million, compared to $10.9
million
- Non-GAAP operating loss of $2.2
million, compared to $5.3
million
- GAAP net loss per basic and diluted share of $0.38, compared to a net loss per basic and
diluted share of $0.07
- Non-GAAP net loss per basic and diluted share of $0.01, compared to a net loss per basic and
diluted share of $0.03
- Cash used in operations of $14.4
million, compared to $12.1
million
Total cash, cash equivalents and marketable securities was
$43.7 million as of March 31,
2020.
A reconciliation of GAAP to non-GAAP results has been provided
in this press release in the accompanying tables. An explanation of
these measures is also included below under the heading "Non-GAAP
Financial Measures."
Business Outlook
For the full year 2020, the Company now expects:
- GAAP revenue in the range of $127
million to $135 million
- Non-GAAP operating loss in the range of $17 million to $24
million
- Non-GAAP net loss per share between $0.11 and $0.16,
based on approximately 150 million to 151 million shares
Quarterly Conference Call
Castlight Health senior management will host a conference call
to discuss its first quarter 2020 results and business outlook
today at 2:00 p.m. Pacific Time
(5:00 p.m. Eastern Time). A live
audio webcast of the conference call, together with detailed
financial information, can be accessed through the Company's
Investor Relations website at http://ir.castlighthealth.com. An
archive of the webcast can also be accessed through the same link.
The live conference call can be accessed by dialing (833) 238-7953
and the replay will be available for one week at (800)
585-8367. The conference ID number for the live call and
replay is 3692372.
About Castlight Health
Castlight is on a mission to make it as easy as humanly possible
for its users to navigate the healthcare system and live happier,
healthier, more productive lives. Our health navigation platform
connects hundreds of health vendors, benefits resources, and plan
designs into one comprehensive health and wellbeing experience. We
guide individuals—based on their unique profile—to the best
resources available to them, whether they are healthy, chronically
ill, or actively seeking medical care. Castlight transforms the
employee benefit experience into a deeply personalized, yet simple,
guided one, empowering better-informed patient decisions to unlock
better healthcare outcomes and maximizing return on healthcare
investments.
For more information visit www.castlighthealth.com. Follow us on
Twitter and LinkedIn and Like us on Facebook.
Non-GAAP Financial Measures
To supplement Castlight Health's financial statements presented
in accordance with generally accepted accounting principles (GAAP),
we also use and provide investors and others with non-GAAP measures
of certain components of financial performance, including non-GAAP
gross profit and margin, non-GAAP operating expense, non-GAAP
operating income (loss), non-GAAP net income (loss) and non-GAAP
net income (loss) per share. Non-GAAP gross profit and margin,
non-GAAP operating expense, non-GAAP operating income (loss), and
non-GAAP net income (loss) exclude goodwill impairment, stock-based
compensation, certain legal expenses, amortization of intangibles,
restructuring charges, amortization of internal-use software, and
lease exit and related charges.
We believe that these non-GAAP financial measures provide useful
supplemental information to investors and others, facilitate the
analysis of the company's core operating results and comparison of
operating results across reporting periods, and can help enhance
overall understanding of the company's historical financial
performance.
We have provided a reconciliation of each non-GAAP financial
measure to the most directly comparable GAAP financial measure,
except that we have not reconciled our non-GAAP operating loss and
net loss per share guidance for the full year 2020 to comparable
GAAP measures because we do not provide guidance for stock-based
compensation expense, and capitalization and amortization of
internal-use software, which are reconciling items between GAAP and
non-GAAP. The factors that may impact our future stock-based
compensation expense, and capitalization and amortization of
internal-use software are out of our control and/or cannot be
reasonably predicted, and therefore we are unable to provide such
guidance without unreasonable effort. Factors include our market
capitalization and related volatility of our stock price and our
inability to project the cost or scope of internally produced
software.
These non-GAAP financial measures should be considered in
addition to, not as a substitute for or in isolation from, measures
prepared in accordance with GAAP.
Further, these non-GAAP measures may differ from the non-GAAP
information used by other companies, including peer companies, and
therefore comparability may be limited. Castlight Health encourages
investors and others to review the company's financial information
in its entirety and not rely on a single financial measure.
Safe Harbor for Forward-Looking Statements
This press release contains forward-looking statements about
Castlight Health's expectations, plans, intentions, and strategies,
including, but not limited to, statements regarding Castlight
Health's first quarter performance and 2020 full year projections,
impact of COVID-19, the success of our strategy and our
expectations for our future business and financial performance.
Statements including words such as "anticipate," "believe,"
"estimate," "will," "continue," "expect," or "future," and
statements in the future tense are forward-looking statements.
These forward-looking statements involve risks and uncertainties,
as well as assumptions, which, if they do not fully materialize or
prove incorrect, could cause our results to differ materially from
those expressed or implied by such forward-looking statements. The
risks and uncertainties include those described in Castlight
Health's documents filed with or furnished to the Securities and
Exchange Commission, including the risks set forth in our annual
report on Form 10-K filed on February 28,
2020, and our quarterly report on Form 10-Q for the three
months ended March 31, 2020, when filed. All forward-looking
statements in this press release are based on information available
to Castlight Health as of the date hereof. Castlight Health assumes
no obligation to update these forward-looking statements.
Copyright 2020 Castlight Health, Inc. Castlight
Health® is the registered trademark of Castlight
Health, Inc. Other company and product names may be trademarks of
the respective companies with which they are associated.
CASTLIGHT HEALTH,
INC.
|
CONDENSED
CONSOLIDATED BALANCE SHEETS
|
(In
thousands)
|
(unaudited)
|
|
|
As
of
|
|
March 31,
2020
|
|
December 31,
2019
|
Assets
|
|
|
|
Current
assets:
|
|
|
|
Cash and cash
equivalents
|
$
|
37,681
|
|
|
$
|
43,017
|
|
Marketable
securities
|
6,009
|
|
|
16,411
|
|
Accounts receivable
and other, net
|
38,073
|
|
|
31,397
|
|
Prepaid expenses and
other current assets
|
5,256
|
|
|
4,645
|
|
Total current
assets
|
87,019
|
|
|
95,470
|
|
Property and
equipment, net
|
6,823
|
|
|
4,856
|
|
Restricted cash,
non-current
|
1,144
|
|
|
1,144
|
|
Deferred
commissions
|
12,653
|
|
|
14,718
|
|
Deferred professional
service costs
|
6,220
|
|
|
6,711
|
|
Intangible assets,
net
|
11,104
|
|
|
12,178
|
|
Goodwill
|
41,485
|
|
|
91,785
|
|
Operating lease
right-of-use assets, net
|
12,334
|
|
|
13,906
|
|
Other
assets
|
1,900
|
|
|
2,016
|
|
Total
assets
|
$
|
180,682
|
|
|
$
|
242,784
|
|
Liabilities and
stockholders' equity
|
|
|
|
Current
liabilities:
|
|
|
|
Accounts
payable
|
$
|
13,299
|
|
|
$
|
19,596
|
|
Accrued expenses and
other current liabilities
|
10,445
|
|
|
10,454
|
|
Accrued
compensation
|
4,305
|
|
|
8,770
|
|
Deferred
revenue
|
13,730
|
|
|
10,173
|
|
Operating lease
liabilities
|
5,430
|
|
|
5,914
|
|
Total current
liabilities
|
47,209
|
|
|
54,907
|
|
Deferred revenue,
non-current
|
588
|
|
|
572
|
|
Debt,
non-current
|
930
|
|
|
1,395
|
|
Operating lease
liabilities, non-current
|
10,618
|
|
|
11,823
|
|
Other liabilities,
non-current
|
1,241
|
|
|
1,213
|
|
Total
liabilities
|
60,586
|
|
|
69,910
|
|
Stockholders'
equity
|
120,096
|
|
|
172,874
|
|
Total liabilities and
stockholders' equity
|
$
|
180,682
|
|
|
$
|
242,784
|
|
CASTLIGHT HEALTH,
INC.
|
CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS
|
(In thousands,
except per share data)
|
(unaudited)
|
|
|
Three Months Ended
March 31,
|
|
2020
|
|
2019
|
Revenue:
|
|
|
|
Subscription
|
$
|
38,383
|
|
|
$
|
33,806
|
|
Professional services
and other
|
662
|
|
|
1,684
|
|
Total revenue,
net
|
39,045
|
|
|
35,490
|
|
Cost of
revenue:
|
|
|
|
Cost of
subscription(1)
|
10,232
|
|
|
8,166
|
|
Cost of professional
services and other(1)
|
4,241
|
|
|
5,944
|
|
Total cost of
revenue
|
14,473
|
|
|
14,110
|
|
Gross
profit
|
24,572
|
|
|
21,380
|
|
Operating
expenses:
|
|
|
|
Sales and
marketing(1)
|
10,472
|
|
|
9,215
|
|
Research and
development(1)
|
13,822
|
|
|
15,725
|
|
General and
administrative(1)
|
6,576
|
|
|
7,293
|
|
Goodwill
impairment
|
50,300
|
|
|
—
|
|
Total operating
expenses
|
81,170
|
|
|
32,233
|
|
Operating
loss
|
(56,598)
|
|
|
(10,853)
|
|
Other income,
net
|
263
|
|
|
314
|
|
Net loss
|
$
|
(56,335)
|
|
|
$
|
(10,539)
|
|
Net loss per share,
basic and diluted
|
$
|
(0.38)
|
|
|
$
|
(0.07)
|
|
Weighted-average shares
used to compute basic and diluted net loss
per share
|
148,872
|
|
|
143,000
|
|
|
|
(1)
Includes stock-based compensation expense as follows:
|
|
|
Three Months Ended
March 31,
|
|
2020
|
|
2019
|
Cost of
revenue:
|
|
|
|
Cost of
subscription
|
$
|
169
|
|
|
$
|
219
|
|
Cost of professional
services and other
|
116
|
|
|
265
|
|
Sales and
marketing
|
672
|
|
|
627
|
|
Research and
development
|
1,163
|
|
|
1,704
|
|
General and
administrative
|
1,066
|
|
|
1,162
|
|
CASTLIGHT HEALTH,
INC.
|
CONDENSED
CONSOLIDATED STATEMENTS OF CASH FLOWS
|
(In
thousands)
|
(unaudited)
|
|
|
Three Months Ended
March 31,
|
|
2020
|
|
2019
|
Operating
activities:
|
|
|
|
Net loss
|
$
|
(56,335)
|
|
|
$
|
(10,539)
|
|
Adjustments to
reconcile net loss to net cash used in operating
activities:
|
|
|
|
Depreciation and
amortization
|
1,535
|
|
|
1,344
|
|
Goodwill
impairment
|
50,300
|
|
|
—
|
|
Stock-based
compensation
|
3,186
|
|
|
3,977
|
|
Amortization of
deferred commissions
|
2,383
|
|
|
2,491
|
|
Amortization of
deferred professional service costs
|
925
|
|
|
969
|
|
Non-cash operating
lease expense
|
1,400
|
|
|
1,282
|
|
Accretion and
amortization of marketable securities
|
2
|
|
|
(126)
|
|
Changes in operating
assets and liabilities:
|
|
|
|
Accounts receivable
and other, net
|
(6,676)
|
|
|
(7,883)
|
|
Deferred
commissions
|
(318)
|
|
|
(1,416)
|
|
Deferred professional
service costs
|
(416)
|
|
|
(469)
|
|
Prepaid expenses and
other assets
|
(494)
|
|
|
(751)
|
|
Accounts
payable
|
(7,462)
|
|
|
(849)
|
|
Operating lease
liabilities
|
(1,516)
|
|
|
(1,382)
|
|
Accrued expenses and
other liabilities
|
19
|
|
|
(1,304)
|
|
Deferred
revenue
|
3,573
|
|
|
3,495
|
|
Accrued
compensation
|
(4,465)
|
|
|
(970)
|
|
Net cash used in
operating activities
|
(14,359)
|
|
|
(12,131)
|
|
Investing
activities:
|
|
|
|
Purchase of property
and equipment
|
(1,264)
|
|
|
(204)
|
|
Purchase of marketable
securities
|
(1,989)
|
|
|
—
|
|
Maturities of
marketable securities
|
12,400
|
|
|
11,453
|
|
Net cash provided by
investing activities
|
9,147
|
|
|
11,249
|
|
Financing
activities:
|
|
|
|
Proceeds from exercise
of stock options
|
155
|
|
|
1,680
|
|
Proceeds from ESPP
offering
|
186
|
|
|
—
|
|
Principal payments on
long-term debt
|
(465)
|
|
|
(465)
|
|
Net cash (used in)
provided by financing activities
|
(124)
|
|
|
1,215
|
|
|
|
|
|
Net (decrease)
increase in cash, cash equivalents and restricted cash
|
(5,336)
|
|
|
333
|
|
Cash, cash
equivalents and restricted cash at beginning of period
|
44,342
|
|
|
67,330
|
|
Cash, cash
equivalents and restricted cash at end of period
|
$
|
39,006
|
|
|
$
|
67,663
|
|
|
|
|
|
Reconciliation of
cash, cash equivalents and restricted cash:
|
|
|
|
Cash and cash
equivalents
|
$
|
37,681
|
|
|
$
|
66,338
|
|
Restricted cash
included in Prepaid expenses and other current assets
|
181
|
|
|
—
|
|
Restricted cash,
non-current
|
1,144
|
|
|
1,325
|
|
Total cash, cash
equivalents and restricted cash
|
$
|
39,006
|
|
|
$
|
67,663
|
|
CASTLIGHT HEALTH,
INC.
|
RECONCILIATION OF
GAAP TO NON-GAAP FINANCIAL MEASURES
|
(In thousands,
except per share data)
|
(unaudited)
|
|
|
Three Months
Ended
|
|
March 31,
2020
|
|
December 31,
2019
|
|
March 31,
2019
|
Gross
profit:
|
|
|
|
|
|
GAAP gross profit
subscription
|
$
|
28,151
|
|
|
$
|
25,573
|
|
|
$
|
25,640
|
|
Stock-based
compensation
|
169
|
|
|
179
|
|
|
219
|
|
Amortization of
internal-use software
|
26
|
|
|
—
|
|
|
—
|
|
Amortization of
intangibles
|
530
|
|
|
530
|
|
|
587
|
|
Non-GAAP gross profit
subscription
|
$
|
28,876
|
|
|
$
|
26,282
|
|
|
$
|
26,446
|
|
GAAP gross margin
subscription
|
73.3
|
%
|
|
73.6
|
%
|
|
75.8
|
%
|
Non-GAAP gross margin
subscription
|
75.2
|
%
|
|
75.7
|
%
|
|
78.2
|
%
|
|
|
|
|
|
|
GAAP gross loss
professional services
|
$
|
(3,579)
|
|
|
$
|
(5,426)
|
|
|
$
|
(4,260)
|
|
Stock-based
compensation
|
116
|
|
|
216
|
|
|
265
|
|
Non-GAAP gross loss
professional services
|
$
|
(3,463)
|
|
|
$
|
(5,210)
|
|
|
$
|
(3,995)
|
|
GAAP gross margin
professional services
|
(541)
|
%
|
|
(315)
|
%
|
|
(253)
|
%
|
Non-GAAP gross margin
professional services
|
(523)
|
%
|
|
(302)
|
%
|
|
(237)
|
%
|
|
|
|
|
|
|
GAAP gross
profit
|
$
|
24,572
|
|
|
$
|
20,147
|
|
|
$
|
21,380
|
|
Impact of non-GAAP
adjustments
|
841
|
|
|
925
|
|
|
1,071
|
|
Non-GAAP gross
profit
|
$
|
25,413
|
|
|
$
|
21,072
|
|
|
$
|
22,451
|
|
GAAP gross
margin
|
62.9
|
%
|
|
55.3
|
%
|
|
60.2
|
%
|
Non-GAAP gross
margin
|
65.1
|
%
|
|
57.8
|
%
|
|
63.3
|
%
|
|
|
|
|
|
|
Operating
expense:
|
|
|
|
|
|
GAAP sales and
marketing
|
$
|
10,472
|
|
|
$
|
10,664
|
|
|
$
|
9,215
|
|
Stock-based
compensation
|
(672)
|
|
|
(175)
|
|
|
(627)
|
|
Amortization of
intangibles
|
(528)
|
|
|
(529)
|
|
|
(272)
|
|
Non-GAAP sales and
marketing
|
$
|
9,272
|
|
|
$
|
9,960
|
|
|
$
|
8,316
|
|
|
|
|
|
|
|
GAAP research and
development
|
$
|
13,822
|
|
|
$
|
14,487
|
|
|
$
|
15,725
|
|
Stock-based
compensation
|
(1,163)
|
|
|
(1,369)
|
|
|
(1,704)
|
|
Certain legal
expenses
|
191
|
|
|
—
|
|
|
(191)
|
|
Capitalization of
internally developed software
|
21
|
|
|
80
|
|
|
—
|
|
Non-GAAP research and
development
|
$
|
12,871
|
|
|
$
|
13,198
|
|
|
$
|
13,830
|
|
|
|
|
|
|
|
GAAP general and
administrative
|
$
|
6,576
|
|
|
$
|
7,238
|
|
|
$
|
7,293
|
|
Stock-based
compensation
|
(1,066)
|
|
|
(1,217)
|
|
|
(1,162)
|
|
Amortization of
intangibles
|
(17)
|
|
|
(16)
|
|
|
(17)
|
|
Certain legal
expenses
|
—
|
|
|
—
|
|
|
(533)
|
|
Non-GAAP general and
administrative
|
$
|
5,493
|
|
|
$
|
6,005
|
|
|
$
|
5,581
|
|
|
|
|
|
|
|
GAAP goodwill
impairment
|
$
|
50,300
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Goodwill
impairment
|
(50,300)
|
|
|
—
|
|
|
—
|
|
Non-GAAP goodwill
impairment
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
|
|
|
|
|
GAAP operating
expense
|
$
|
81,170
|
|
|
$
|
32,389
|
|
|
$
|
32,233
|
|
Impact of non-GAAP
adjustments
|
(53,534)
|
|
|
(3,226)
|
|
|
(4,506)
|
|
Non-GAAP operating
expense
|
$
|
27,636
|
|
|
$
|
29,163
|
|
|
$
|
27,727
|
|
|
|
|
|
|
|
Operating
loss:
|
|
|
|
|
|
GAAP operating
loss
|
$
|
(56,598)
|
|
|
$
|
(12,242)
|
|
|
$
|
(10,853)
|
|
Impact of non-GAAP
adjustments
|
54,375
|
|
|
4,151
|
|
|
5,577
|
|
Non-GAAP operating
loss
|
$
|
(2,223)
|
|
|
$
|
(8,091)
|
|
|
$
|
(5,276)
|
|
|
|
|
|
|
|
Net loss and net
loss per share:
|
|
|
|
|
|
GAAP net
loss
|
$
|
(56,335)
|
|
|
$
|
(11,746)
|
|
|
$
|
(10,539)
|
|
Total pre-tax impact
of non-GAAP adjustments
|
54,375
|
|
|
4,151
|
|
|
5,577
|
|
Non-GAAP net
loss
|
$
|
(1,960)
|
|
|
$
|
(7,595)
|
|
|
$
|
(4,962)
|
|
GAAP net loss per
share, basic and diluted
|
$
|
(0.38)
|
|
|
$
|
(0.08)
|
|
|
$
|
(0.07)
|
|
Non-GAAP net loss per
share, basic and diluted
|
$
|
(0.01)
|
|
|
$
|
(0.05)
|
|
|
$
|
(0.03)
|
|
Shares used in basic
and diluted net loss per share computation
|
148,872
|
|
|
147,359
|
|
|
143,000
|
|
Castlight Media Contact:
press@castlighthealth.com
276-492-4248
Castlight Investor Contact:
ir@castlighthealth.com
415-829-1680
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SOURCE Castlight Health, Inc.