After U.S. markets closed for trading yesterday, Accolade Inc. (ACCD:NASDAQ), which provides personalized, technology-enabled solutions to help individuals understand and navigate the healthcare system and their plan benefits, announced financial results for the third quarter of 2022 ended November 30, 2021.
The company reported that revenue in Q3/22 increased by 117% to $83.5 million, compared to $38.4 million in Q3/21. The firm indicated that net income during the same period increased by 236% to $22.5 million, versus a net loss of $16.6 million in the prior year's corresponding quarter.
Accolade's CEO Rajeev Singh commented, "It is remarkable for me to look back at the last twelve months and consider Accolade's transformation from a navigation and advocacy company to a personalized healthcare company. In January 2021, we were serving about 100 customers and 2 million members. Today, with the integration of primary care, mental health and expert medical opinion from our acquisitions of PlushCare and 2nd.MD, we now serve more than 600 customers and 10 million members, having added more than 200 customers since combining our companies."
"With the January 1 launch of our first customers on Accolade Care and Accolade One, we have completed the transition from a company that focused solely on providing navigation, guidance, and recommendations to our members, to a dramatically more impactful company that has all the capabilities to deliver an end-to-end care journey that can transform the healthcare experience," Singh added.
The company's CFO Steve Barnes remarked, "The strong outperformance was largely driven by earlier than expected achievement of approximately $7 million of performance-based revenue, including $2.5 million that was previously included in our third quarter guidance. This revenue recognition is a direct result of Accolade's continued success in delivering measurement-based outcomes for our customers."
The company offered some forward guidance on a non-GAAP basis and indicated that for Q4/22 it expects revenue will be in the range of $90-93 million. During the same period, the firm stated that it estimates adjusted EBITDA will be between $(4) million and $(8) million.
The company noted that it is updating it FY/22 forecasts and raising its revenue estimates from prior estimates of $303-307 million to $306-$309 million. The firm also raised its FY/22 estimates for adjusted EBITDA to between $(48) million and $(52) million.
In addition, Accolade provided its estimates for FY/23 calling for a 25% growth in annual revenue compared to FY22. The company stated that it expects adjusted EBITDA will be approximately 11-12% of revenue.
CFO Barnes commented further stating, "As we enter the fourth quarter with a more integrated suite of offerings and expanded go to market motion, we are beginning to see the positive impact of combining Accolade, 2nd.MD and PlushCare."
Barnes added that the firm remains focused on improving bottom line performance and is striving towards reaching breakeven levels in adjusted EBITDA in FY/25.
Accolade works to provide millions of people with personalized, data-driven navigational tools to improve and utilize their healthcare plans. Using best-in-class care navigation, the company helps members optimize their care choices through a combination of virtual primary care, mental health support and expert medical opinion services. The firm seeks boost consumer satisfaction by improving health outcomes and lowering medical costs.
Accolade began the day with a market cap of around $1.3 billion with approximately 66.66 million shares outstanding and a short interest of about 6.6%. ACCD shares opened 15% higher today at $22.03 (+$2.89, +15.10%) over yesterday's $19.14 closing price. The stock has traded today between $21.63 and $24.90 per share and is currently trading at $24.22 (+$5.08, +26.54%).
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