LifeMD(LFMD) - 2022 Q4 - Annual Report

Revenue Performance - Total revenue for the year ended December 31, 2022 was approximately $119.0 million, an increase of 28$92.9 million for the year ended December 31, 2021[198] - Telehealth revenue for 2022 was $82.6 million, accounting for 69$36.4 million, representing a 47% increase and accounting for 31% of total revenue[198] Profit and Loss - Gross profit increased by approximately 34% to $100.4 million for 2022, with a gross profit margin of 84$(43.4) million, an improvement from $(54.3) million in 2021[198] - Net loss attributable to common stockholders for 2022 was$(48.6) million, compared to $(61.8) million in 2021[198] Expenses - Total expenses for 2022 were approximately$143.8 million, an increase of 11% from approximately $129.2 million in 2021[202] - General and administrative expenses increased by approximately$7.4 million in 2022, primarily due to a $7.0 million increase in payroll expenses[204] Cash Flow and Working Capital - For the year ended December 31, 2022, the company reported a net cash used in operating activities of approximately$23.0 million, a decrease from $33.1 million in 2021[208] - The company's working capital decreased by approximately$42.2 million during the year ended December 31, 2022, resulting in a working capital of $(20.1) million[206] - The company experienced a net decrease in cash of approximately$37.4 million during the year ended December 31, 2022[207] - As of December 31, 2022, the company had a current cash balance of approximately $14.6 million[212] Acquisitions and Impairments - The company acquired Cleared, a nationwide allergy telehealth platform, for approximately$9.1 million in January 2022[187] - WorkSimpli acquired assets associated with ResumeBuild for $4.0 million in February 2022[189] - The company recorded an$8.0 million goodwill impairment charge and an $827 thousand intangible asset impairment charge in 2022[204] - Goodwill of$8.0 million was recognized in conjunction with the Cleared acquisition, with an impairment charge of $8.0 million recorded in 2022[228] - An impairment loss of$827 thousand was recorded related to the Cleared customer relationship intangible asset during the year ended December 31, 2022[229] Capital Expenditures - Net cash used in investing activities for 2022 was approximately $13.9 million, compared to$3.4 million in 2021, mainly due to capitalized software costs of $8.5 million[209] - The Company capitalized$12.1 million in software costs as of December 31, 2022, an increase of $8.5 million or 236$3.6 million in 2021[225] Liabilities and Deficits - The company has an accumulated deficit of approximately $190.6 million as of December 31, 2022[212] - As of December 31, 2022, the Company had accrued contract liabilities of approximately$5.5 million, up from $1.5 million in 2021[224] - The company recorded a$5.1 million reduction in contingent consideration related to the Cleared acquisition due to remeasurement of fair value[204] Accounting and Revenue Recognition - The Company is evaluating the effects of the new accounting standards update effective after December 15, 2022, related to business combinations[231] - The Company allows subscribers to cancel their subscription at any point during the billing cycle, impacting revenue recognition[223] - The Company capitalizes certain internal payroll and third-party costs related to internally developed software, amortizing these costs over an estimated useful life of three years[225]