Accolade Announces Results for Fiscal Third Quarter 2024

SEATTLE, Jan. 08, 2024 (GLOBE NEWSWIRE) -- Accolade, Inc. (NASDAQ: ACCD) today announced financial results for the fiscal third quarter ended November 30, 2023.

“As we head into the new year, Accolade continues to define the future of how healthcare should be experienced in this country. Our unique combination of people and technology is creating a new model for improving health outcomes and helping our more than 10 million members live healthier lives. We are closing the physician gap, improving access to care, and leveraging AI and other innovations to make the system work better for our employer customers, their employees and their families. The results can be seen in our growing customer base and increasing revenues as we plan to deliver positive Adjusted EBITDA in the fourth quarter and next fiscal year,” said Rajeev Singh, Accolade Chairman of the Board of Directors and Chief Executive Officer.

Financial Highlights for Fiscal Third Quarter ended November 30, 2023

 Three months ended November 30,  
  2023   2022  % Change(2)
 (in millions, except percentages)  
GAAP Financial Data:     
Revenue$99.4  $90.9  9%
Net loss$(21.1) $(39.9) 47%
Non-GAAP Financial Data(1):     
Adjusted EBITDA$(4.6) $(10.2) 55%
Adjusted Gross Profit$46.0  $41.8  10%
Adjusted Gross Margin 46.3%  45.9%  

(1)  A reconciliation of GAAP to non-GAAP results has been provided in this press release in the accompanying Financial Tables. An explanation of these measures is also included below under the heading "Non-GAAP Financial Measures."

(2)  Percentages are calculated from accompanying Financial Tables and may differ from percentage change of numbers in Financial Highlights table due to rounding.

Steve Barnes, Accolade Chief Financial Officer, commented, “Accolade exceeded both top and bottom line guidance this quarter as we continue to execute consistently across the business. On the strength of our new bookings and the utilization trends we are experiencing, we are raising our guidance for fiscal year 2024 and affirming our expectation for approximately 20% revenue growth and Adjusted EBITDA between 2% - 4% in fiscal year 2025.”

Financial Outlook

Accolade provides forward-looking guidance on revenue and Adjusted EBITDA, a non-GAAP financial measure.

For the fiscal fourth quarter ending February 29, 2024, we expect:

  • Revenue between $121.5 million and $125.5 million
  • Adjusted EBITDA between $16 million and $20 million

For the fiscal year ending February 29, 2024, we expect:

  • Revenue between $411 million and $415 million
  • Adjusted EBITDA between $(6) million and $(10) million

For the fiscal year ending February 28, 2025, we are affirming preliminary revenue and Adjusted EBITDA guidance as follows:

  • Revenue growth of approximately 20%
  • Adjusted EBITDA between 2% and 4% of revenue

Accolade has not reconciled guidance for Adjusted EBITDA to net loss, the most directly comparable GAAP measure, and has not provided forward-looking guidance for net loss, because there are items that may impact net loss, including stock-based compensation, that are not within the company’s control or cannot be reasonably predicted.

Quarterly Conference Call Details

The company will host a conference call today, January 8, 2024 at 4:30 p.m. E.T. to discuss its financial results.
To Listen via Telephone: Pre-registration is required by the conference call operator. Please pre-register by clicking here ( Upon registering, you will be emailed a dial-in number, direct passcode and unique PIN.

To Listen via Internet: The conference call can be accessed via a live audio webcast that will be available online at

Replay: A replay of the call will be available via webcast for on-demand listening shortly after the completion of the call, at

Forward-Looking Statements

This release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and the Private Securities Litigation Reform Act of 1995, as amended. These forward-looking statements include statements regarding our future growth and our financial outlook. Forward-looking statements are subject to risks and uncertainties and are based on potentially inaccurate assumptions that could cause actual results to differ materially from those expected or implied by the forward-looking statements. Actual results may differ materially from the results predicted, and reported results should not be considered as an indication of future performance. In some cases, you can identify forward-looking statements because they contain words such as “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intend,” “may,” “maintain,” “might,” “likely,” “plan,” “potential,” “predict,” “project,” “seek,” “should,” “target,” “will,” “would,” or similar expressions and the negatives of those terms.

Important risks and uncertainties that could cause our actual results and financial condition to differ materially from those indicated in the forward-looking statements include, among others, the risks described under the heading “Risk Factors” in Accolade’s most recently filed Annual Report on Form 10-K and subsequent filings, which should be read in conjunction with any forward-looking statements. All forward-looking statements in this press release are based on information available to Accolade as of the date hereof, and it does not assume any obligation to update the forward-looking statements provided to reflect events that occur or circumstances that exist after the date on which they were made, except as required by law.

About Accolade, Inc.

Accolade (Nasdaq: ACCD) is a Personalized Healthcare company that provides millions of people and their families with exceptional healthcare experiences so they can live their healthiest lives. Accolade’s employer, health plan, and consumer solutions combine virtual primary care and mental health, expert medical opinion, and best-in-class care navigation. These offerings are built on a platform that is engineered to care through predictive engagement of population health needs, proactive care that improves outcomes and cost savings, and by addressing barriers to access and continuity of care. Accolade consistently receives consumer satisfaction ratings of over 90%. For more information, visit Follow us on LinkedIn, Twitter, Instagram and Facebook.

Investor Contact:

Todd Friedman, Investor Relations,

Media Contact:

Public Relations,

Source: Accolade

Financial Tables

Accolade, Inc. and Subsidiaries
Condensed Consolidated Balance Sheets (unaudited)
(In thousands, except share and per share data)
 November 30,
 February 28,
Current assets:   
Cash and cash equivalents$230,017  $321,083 
Accounts receivable, net 23,195   23,435 
Unbilled revenue 2,362   3,260 
Current portion of deferred contract acquisition costs 4,462   4,022 
Prepaid and other current assets 12,054   14,149 
Total current assets 272,090   365,949 
Property and equipment, net 19,223   14,763 
Operating lease right-of-use assets 28,847   29,525 
Goodwill 278,191   278,191 
Intangible assets, net 174,548   203,202 
Deferred contract acquisition costs 9,588   9,815 
Other assets 2,984   1,624 
Total assets$785,471  $903,069 
Liabilities and stockholders’ equity   
Current liabilities:   
Accounts payable$12,667  $10,155 
Accrued expenses and other current liabilities 8,334   11,744 
Accrued compensation 25,911   39,346 
Due to customers 9,085   15,694 
Current portion of deferred revenue 52,772   35,191 
Current portion of operating lease liabilities 6,900   7,284 
Total current liabilities 115,669   119,414 
Loans payable, net of unamortized issuance costs 208,178   282,323 
Operating lease liabilities 26,620   27,189 
Other noncurrent liabilities 165   203 
Deferred revenue 120   154 
Total liabilities 350,752   429,283 
Commitments and Contingencies   
Stockholders’ equity   
Common stock par value $0.0001; 500,000,000 shares authorized; 76,966,368 and 73,089,075 shares issued and outstanding at November 30, 2023 and February 28, 2023, respectively 8   7 
Additional paid-in capital 1,481,303   1,428,073 
Accumulated deficit (1,046,592)  (954,294)
Total stockholders’ equity 434,719   473,786 
Total liabilities and stockholders’ equity$785,471  $903,069 

Accolade, Inc. and Subsidiaries
Condensed Consolidated Statements of Operations (unaudited)
(In thousands, except share and per share data)
 Three months ended November 30, Nine months ended November 30,
  2023   2022   2023   2022 
Revenue$99,371  $90,946  $289,461  $264,117 
Cost of revenue, excluding depreciation and amortization 54,518   50,412   164,038   147,857 
Operating expenses:       
Product and technology 23,468   24,254   74,969   77,265 
Sales and marketing 26,230   25,023   75,339   75,573 
General and administrative 15,474   20,037   47,813   61,295 
Depreciation and amortization 11,400   11,602   33,858   34,749 
Goodwill impairment          299,705 
Total operating expenses 76,572   80,916   231,979   548,587 
Loss from operations (31,719)  (40,382)  (106,556)  (432,327)
Interest income (expense), net 1,705   386   4,340   (484)
Other income (expense) 9,281   201   10,424   21 
Loss before income taxes (20,733)  (39,795)  (91,792)  (432,790)
Income tax benefit (expense) (331)  (77)  (506)  3,573 
Net loss$(21,064) $(39,872) $(92,298) $(429,217)
Net loss per share, basic and diluted$(0.28) $(0.56) $(1.24) $(6.07)
Weighted-average common shares outstanding, basic and diluted 76,139,256   71,228,351   74,572,094   70,755,157 

The following table summarizes the amount of stock-based compensation included in the condensed consolidated statements of operations:

 Three months ended November 30, Nine months ended November 30,
  2023   2022   2023   2022 
Cost of revenue, excluding depreciation and amortization$1,163  $1,247  $3,276  $3,645 
Product and technology 7,807   5,930   22,416   19,045 
Sales and marketing 3,321   4,513   11,023   12,772 
General and administrative 3,353   6,216   8,933   19,347 
Total stock-based compensation$15,644  $17,906  $45,648  $54,809 

Accolade, Inc. and Subsidiaries
Condensed Consolidated Statements of Cash Flows (unaudited)
(In thousands)
 Nine months ended November 30,
  2023   2022 
Cash flows from operating activities:   
Net loss$(92,298) $(429,217)
Adjustments to reconcile net loss to net cash used in   
Operating activities:   
Goodwill impairment    299,705 
Depreciation and amortization expense 33,858   34,749 
Amortization of deferred contract acquisition costs 4,012   2,592 
Deferred income taxes    (3,859)
Noncash interest expense 1,236   1,251 
Gain on repurchase of convertible notes (9,268)   
Stock-based compensation expense 45,648   54,809 
Changes in operating assets and liabilities, net of effect of acquisitions:   
Accounts receivable and unbilled revenue 1,138   6,616 
Accounts payable and accrued expenses (133)  244 
Deferred contract acquisition costs (4,224)  (6,428)
Deferred revenue and due to customers 10,937   5,596 
Accrued compensation (13,433)  (3,722)
Other liabilities (314)  2,030 
Other assets 721   (2,512)
Net cash used in operating activities (22,120)  (38,146)
Cash flows from investing activities:   
Capitalized software development costs (6,475)  (2,914)
Purchases of property and equipment (3,900)  (1,901)
Net cash used in investing activities (10,375)  (4,815)
Cash flows from financing activities:   
Payments for repurchase of convertible notes (65,808)   
Payments for debt extinguishment costs (355)   
Proceeds from stock option exercises 4,013   1,646 
Proceeds from employee stock purchase plan 3,579   2,927 
Payment of contingent consideration for acquisition    (1,828)
Net cash provided (used) by financing activities (58,571)  2,745 
Net decrease in cash and cash equivalents (91,066)  (40,216)
Cash and cash equivalents, beginning of period 321,083   365,853 
Cash and cash equivalents, end of period$230,017  $325,637 
Supplemental cash flow information:   
Interest paid$1,590  $1,539 
Fixed assets and capitalized software included in accounts payable$40  $736 
Other receivable related to stock option exercises$1  $ 
Income taxes paid$325  $103 

Non-GAAP Financial Measures

In addition to our financial results determined in accordance with GAAP, we use the following non-GAAP financial measures to help us evaluate trends, establish budgets, measure the effectiveness and efficiency of our operations, and determine employee incentives. We believe that non-GAAP financial information, when taken collectively, may be helpful to investors because it provides consistency and comparability with past financial performance. However, non-GAAP financial information is presented for supplemental informational purposes only, has limitations as an analytical tool and should not be considered in isolation or as a substitute for financial information presented in accordance with GAAP. In addition, other companies, including companies in our industry, may calculate similarly-titled non-GAAP measures differently or may use other measures to evaluate their performance. A reconciliation is provided below for each non-GAAP financial measure to the most directly comparable financial measure stated in accordance with GAAP. Investors are encouraged to review the related GAAP financial measures and the reconciliation of these non-GAAP financial measures to their most directly comparable GAAP financial measures, and not to rely on any single financial measure to evaluate our business. In evaluating these non-GAAP financial measures, you should be aware that in the future we expect to incur expenses similar to the adjustments in this presentation. Our presentation of non-GAAP financial measures should not be construed as an inference that our future results will be unaffected by these expenses or any unusual or nonrecurring items.

Adjusted Gross Profit and Adjusted Gross Margin

Adjusted Gross Profit is a non-GAAP financial measure that we define as revenue less cost of revenue, excluding depreciation and amortization, and excluding stock-based compensation and severance costs. We define Adjusted Gross Margin as our Adjusted Gross Profit divided by our revenue. We believe Adjusted Gross Profit and Adjusted Gross Margin are useful to investors, as they eliminate the impact of certain noncash expenses and allow a direct comparison of these measures between periods without the impact of noncash expenses and certain other nonrecurring operating expenses.

Adjusted EBITDA

Adjusted EBITDA is a non-GAAP financial measure that we define as net income (loss) adjusted to exclude interest expense (income), net, income tax expense (benefit), depreciation and amortization, stock-based compensation, acquisition and integration-related costs, goodwill impairment, change in fair value of contingent consideration, severance costs, and other expense (income). Severance costs include severance payments related to the realignment of our resources. Other expense (income) includes debt extinguishment gain or loss and foreign exchange gain or loss. We believe Adjusted EBITDA provides investors with useful information on period-to-period performance as evaluated by management and comparison with our past financial performance. We believe Adjusted EBITDA is useful in evaluating our operating performance compared to that of other companies in our industry, as this measure generally eliminates the effects of certain items that may vary from company to company for reasons unrelated to overall operating performance.

Adjusted Gross Profit, Adjusted Gross Margin and Adjusted EBITDA have certain limitations, including that they exclude the impact of certain non-cash charges, such as depreciation and amortization, whereas underlying assets may need to be replaced and result in cash capital expenditures, and stock-based compensation expense, which is a recurring charge.

The following table presents, for the periods indicated, a reconciliation of our revenue to Adjusted Gross Profit:

 Three months ended November 30, Nine months ended November 30,
  2023   2022   2023   2022 
 (in thousands,except percentages) (in thousands,except percentages)
Revenue$99,371  $90,946  $289,461  $264,117 
Cost of revenue, excluding depreciation and amortization (54,518)  (50,412)  (164,038)  (147,857)
Gross profit, excluding depreciation and amortization 44,853   40,534   125,423   116,260 
Stock‑based compensation, cost of revenue 1,163   1,247   3,276   3,645 
Severance costs, cost of revenue (38)  (1)  688   113 
Adjusted Gross Profit$45,978  $41,781  $129,387  $120,019 
Gross margin, excluding depreciation and amortization 45.1%  44.6%  43.3%  44.0%
Adjusted Gross Margin 46.3%  45.9%  44.7%  45.4%

The following table presents, for the periods indicated, a reconciliation of our Adjusted EBITDA to our net loss:

 Three months ended November 30, Nine months ended November 30,
  2023   2022   2023   2022 
 (in thousands) (in thousands)
Net loss$(21,064) $(39,872) $(92,298) $(429,217)
Adjusted for:       
Interest expense (income), net (1,705)  (386)  (4,340)  484 
Income tax (benefit) expense 331   77   506   (3,573)
Depreciation and amortization 11,400   11,602   33,858   34,749 
Stock‑based compensation 15,644   17,906   45,648   54,809 
Acquisition and integration‑related costs(1) 208   439   187   439 
Goodwill impairment          299,705 
Severance costs(2) (159)  213   891   3,288 
Other expense (income)(3) (9,281)  (201)  (10,424)  (21)
Adjusted EBITDA$(4,626) $(10,222) $(25,972) $(39,337)

(1)   For the three and nine months ended November 30, 2023 and 2022, acquisition and integration-related costs represent expenses associated with litigation inherited through the PlushCare acquisition. Refer to Note 10 in our condensed consolidated financial statements for further details.
(2)   Severance costs represent expenses associated with workforce realignment actions taken by management.
(3)   For the three and nine months ended November 30, 2023, other expense (income) includes a gain on extinguishment of debt.

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