Castlight Health Announces Third Quarter 2020 Results
November 5, 2020
SAN FRANCISCO — November 5, 2020 — Castlight Health, Inc. (NYSE:CSLT), a leading health benefits platform provider, today announced results for its third quarter ended September 30, 2020.
"In the third quarter, we made progress on our strategic priorities, meeting our goal of signing a new health plan partner in 2020, making the high-touch Care Guides solution that launched last year generally available to the market, and achieving strong financial results that allow us to increase our 2020 financial outlook,” said Maeve O’Meara, chief executive officer of Castlight Health. “We also delivered significant product innovation in the quarter, aligning our solutions to employer priorities like enablement of virtual care. We are competitively well positioned in the growing navigation market due to the complement of our high-touch capabilities, alongside our high-tech platform. As we look towards 2021, our two national health plan partnerships and the strength of our pipeline provide a foundation for growth through health plans."
Financial performance for the three months ended September 30, 2020 compared to the three months ended September 30, 2019 includes:
- GAAP total revenue of $35.1 million, compared to $35.5 million
- GAAP gross margin of 66.1%, compared to 59.1%
- Non-GAAP gross margin of 69.0%, compared to 62.1%
- GAAP operating loss of $0.5 million, compared to $9.6 million
- Non-GAAP operating income of $3.7 million, compared to an operating loss of $5.4 million
- GAAP net loss per basic and diluted share of $0.00, compared to a net loss per basic and diluted share of $0.06
- Non-GAAP net income per basic and diluted share of $0.02, compared to a net loss per basic and diluted share of $0.04
- Cash provided by operations of $2.7 million, compared to cash used in operations of $7.4 million
Total cash and cash equivalents were $46.8 million as of September 30, 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.”
The Company is updating its previously-issued 2020 outlook. For the full year 2020, the Company now expects:
- GAAP revenue in the range of $140 million to $143 million
- Non-GAAP operating income between $0 to $3 million
- Non-GAAP net income per share between $0.00 and $0.02, based on approximately 151 million shares
Quarterly Conference Call
Castlight Health senior management will host a conference call to discuss its third 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 8774374.
About Castlight Health
Castlight is on a mission to make it as easy as humanly possible for people 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 employee benefits into a deeply personalized, yet simple, guided experience, empowering better-informed patient decisions to unlock better healthcare outcomes and maximizing return on healthcare investments.
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, capitalization and 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. However, 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.
The non-GAAP measures we provide 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.
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.
Safe Harbor for Forward-Looking Statements
This press release contains forward-looking statements within the meaning of the federal securities laws, which statements involve substantial risks and uncertainties. Words such as "anticipates," "expects," "intends," "plans," "projects," "believes," "seeks," "estimates," "can," "may," "will," "would" and similar expressions identify such forward-looking statements. These statements are not guarantees of results and should not be considered as an indication of future activity or future performance. The forward-looking statements about Castlight Health’s expectations, plans, intentions, and strategies include, but are not limited to, statements regarding Castlight Health’s third quarter 2020 performance and 2020 full year projections, the impact of COVID-19, the success of our strategy, and our expectations for our future business and financial performance. 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 for the year ended December 31, 2019 as filed with the SEC on February 28, 2020, and our quarterly reports on Form 10-Q, including the quarterly report for the three months ended September 30, 2020, when filed. All forward-looking statements in this press release are expressly qualified in their entirety by these cautionary statements and are based on information available to Castlight Health as of the date hereof. Castlight Health assumes no obligation to update these forward-looking statements, except as required by law.
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.