Part I [Item 1. Business](index=8&type=section&id=Item%201.%20Business) CareCloud, Inc. provides comprehensive cloud-based healthcare IT solutions and business services, leveraging a global workforce [Overview](index=8&type=section&id=Overview) CareCloud offers proprietary cloud-based EHR and RCM solutions and services to enhance healthcare provider performance - The company's core business provides technology-enabled solutions including **Electronic Health Records (EHRs)**, **Practice Management (PM) software**, **Patient Experience Management (PXM)**, **Robotic Processing Automation (RPA)**, **Telehealth**, and **Revenue Cycle Management (RCM) services**[26](index=26&type=chunk)[27](index=27&type=chunk) - CareCloud also provides medical practice management services, supplying facilities, equipment, staff, and administrative support[28](index=28&type=chunk) [Market Overview and Opportunity](index=9&type=section&id=Market%20Overview%20and%20Opportunity) The U.S. healthcare IT market, driven by value-based care and regulatory complexity, offers opportunities for CareCloud U.S. Healthcare IT Market Size and Growth (2019 Estimates) | Market Segment | Estimated Size (2019) | Compound Annual Growth Rate (CAGR) | | :--- | :--- | :--- | | Total Healthcare IT | ~$177 billion | - | | Revenue Cycle Management (RCM) | ~$87 billion | 12% | | Electronic Health Record (EHR) | ~$40 billion | 6% | | Analytics and AI | ~$30 billion | 27% | | Telehealth | ~$20 billion | 17% | - Market opportunities for CareCloud arise from the industry's shift to **value-based reimbursement**, evolving **regulatory requirements**, and increasing **patient consumerism**[37](index=37&type=chunk)[38](index=38&type=chunk)[39](index=39&type=chunk) [Business Strategy](index=10&type=section&id=Business%20Strategy) CareCloud's strategy focuses on market leadership in integrated SaaS and business services, leveraging a global workforce for growth - The company's multi-faceted strategy includes providing an **integrated solution suite**, continuously **enhancing solutions**, expanding into **new markets**, growing the **client base**, **up-selling services**, leveraging a **cost-effective offshore workforce**, and pursuing **acquisitions**[43](index=43&type=chunk)[45](index=45&type=chunk)[51](index=51&type=chunk) [Offerings and Clients](index=12&type=section&id=Offerings%20and%20Clients) CareCloud's portfolio spans six strategic areas, serving approximately **40,000 providers** across **2,600 practices** and hospitals - The company's product and service portfolio is structured across six key areas: **Cloud-based Software**, **Technology-enabled Services**, **Apps and App Ecosystem**, **Premier Healthcare IT Consulting & Staffing (medSR)**, **On-demand Workforce (CareCloud Force)**, and **Additional Business Services**[57](index=57&type=chunk)[58](index=58&type=chunk)[62](index=62&type=chunk) - As of December 31, 2021, CareCloud served approximately **40,000 providers** in about **2,600 medical practices and hospitals** across **80 specialties** and **50 states**[70](index=70&type=chunk) [Growth, Competition, and Employees](index=14&type=section&id=Growth%2C%20Competition%2C%20and%20Employees) CareCloud's growth strategy combines organic sales, partnerships, and acquisitions, leveraging its proprietary software and offshore workforce for competitive advantage - The company's growth strategy relies on three main levers: **organic growth** via direct sales, **channel partners**, and **acquisitions** of complementary businesses[75](index=75&type=chunk)[77](index=77&type=chunk)[78](index=78&type=chunk) - CareCloud's competitive advantage stems from delivering solutions at competitive prices by leveraging **proprietary software** and a global team, including an **offshore workforce of approximately 3,400 members** with significantly lower labor costs[82](index=82&type=chunk) - As of December 2021, the company employed approximately **4,100 full-time people worldwide**[84](index=84&type=chunk) [Item 1A. Risk Factors](index=17&type=section&id=Item%201A.%20Risk%20Factors) This section details significant risks to CareCloud's business, including acquisition strategy, operations, regulatory compliance, and stock ownership [Risks Related to Our Acquisition Strategy](index=17&type=section&id=Risks%20Related%20to%20Our%20Acquisition%20Strategy) CareCloud's acquisition strategy poses risks including ineffective growth management, customer retention, unforeseen liabilities, and potential dilutive equity or increased debt - The company's acquisition strategy is a key risk, presenting challenges in **integrating software and services**, **assimilating new employees**, and **diverting management resources**[92](index=92&type=chunk) - There is a risk of being unable to **retain customers from acquired businesses**, as contracts often allow termination on short notice[93](index=93&type=chunk) - Future acquisitions may result in **dilutive equity issuances**, **debt incurrence**, and **increased amortization expenses**, adversely affecting financial results[99](index=99&type=chunk) [Risks Related to Our Business](index=18&type=section&id=Risks%20Related%20to%20Our%20Business) CareCloud faces business risks including COVID-19 impact, intense competition, offshore operations dependence, technological advancement, security breaches, and a history of losses - The **COVID-19 pandemic** poses a risk, as approximately **60% of revenue** is tied to customer cash collections, which can decline with reduced patient visits[102](index=102&type=chunk) - Business success is heavily dependent on **offshore operations in Pakistan and Sri Lanka**, where approximately **3,400 employees** are located, making operations vulnerable to political or social unrest[111](index=111&type=chunk)[112](index=112&type=chunk) - The company has a history of operating and net losses, reporting a **net loss of $8.8 million in 2020**, despite achieving **net income of $2.8 million in 2021**, with future profitability not guaranteed[124](index=124&type=chunk) - A **material weakness in internal controls over financial reporting** was identified due to a lack of controls over the completeness and accuracy of key inputs for a non-routine transaction[177](index=177&type=chunk) [Regulatory Risks](index=30&type=section&id=Regulatory%20Risks) Operating in the heavily regulated healthcare industry, CareCloud faces significant regulatory risks, including compliance with complex laws and maintaining EHR certification - The company is subject to complex healthcare regulations, including the **federal Anti-Kickback Statute (AKS)** and **False Claims Act (FCA)**, with potential for substantial civil and criminal penalties for violations[189](index=189&type=chunk) - As a business associate, the company must comply with **HIPAA and HITECH Act provisions**; a breach of protected health information could lead to significant liabilities, including **civil penalties of up to $1.5 million per incident**[197](index=197&type=chunk)[199](index=199&type=chunk) - The company must maintain **EHR solution certification** under the HITECH Act for customers to qualify for government incentives; failure to do so would adversely affect the business[192](index=192&type=chunk)[194](index=194&type=chunk) [Risks Related to Ownership of Our Common and Preferred Stock](index=34&type=section&id=Risks%20Related%20to%20Ownership%20of%20Our%20Common%20and%20Preferred%20Stock) Stockholders face risks including stock price volatility, Executive Chairman Mahmud Haq's **30.1% control**, no common stock dividends, and for preferred stockholders, junior ranking to debt and potential dividend non-payment - Executive Chairman Mahmud Haq beneficially owns **30.1% of outstanding common stock**, granting him significant control over stockholder-approved matters, including director elections[214](index=214&type=chunk) - The company does not intend to pay **cash dividends on common stock**, making capital appreciation the sole potential source of gain for common stockholders[219](index=219&type=chunk) - Series A and B preferred stock rank **junior to all company indebtedness**; in bankruptcy or liquidation, assets are available to preferred stockholders only after all creditors are paid[227](index=227&type=chunk) - Preferred stock dividend payments are contingent on **compliance with SVB loan covenants**; a default could prohibit payments[230](index=230&type=chunk)[231](index=231&type=chunk) [Item 2. Properties](index=39&type=section&id=Item%202.%20Properties) CareCloud's headquarters are in Somerset, New Jersey, with significant leased office space in the U.S., Pakistan, and Sri Lanka, all deemed adequate - The company's principal executive offices are in **Somerset, New Jersey**, leasing approximately **152,000 sq. ft. in 16 U.S. locations** and **47,000 sq. ft. for pediatric offices**[251](index=251&type=chunk) - Significant office and server facility space is leased in **Islamabad, Bagh, and Karachi, Pakistan**, and in **Sri Lanka** to support offshore operations[252](index=252&type=chunk) [Item 3. Legal Proceedings](index=39&type=section&id=Item%203.%20Legal%20Proceedings) CareCloud's subsidiary, MAC, is in arbitration with RPRWC over an alleged billing services breach, with damages claimed up to **$10.8 million**, which MAC intends to vigorously defend - The company's subsidiary, **MTBC Acquisition Corp. (MAC)**, is in arbitration with **Randolph Pain Relief and Wellness Center (RPRWC)** over an alleged contract breach by an acquired predecessor company[254](index=254&type=chunk)[257](index=257&type=chunk) - RPRWC's damage claim has fluctuated, with a recent expert estimate between **$9.8 million and $10.8 million**, and the arbitration hearing is scheduled for April 2022[258](index=258&type=chunk) - MAC believes the allegations lack merit and plans to **vigorously defend** against the claim, anticipating any potential loss to be substantially less than the amount claimed[259](index=259&type=chunk) Part II [Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities](index=40&type=section&id=Item%205.%20Market%20for%20Registrant%27s%20Common%20Equity%2C%20Related%20Stockholder%20Matters%20and%20Issuer%20Purchases%20of%20Equity%20Securities) The company's common stock trades on Nasdaq under "MTBC", with approximately **7,800 holders**; no cash dividends are anticipated due to lender restrictions - The company's common stock is listed on the **Nasdaq Global Market** under the symbol **"MTBC"**[263](index=263&type=chunk) - The company has not paid **cash dividends on common stock** since its 2014 IPO and does not plan to, as restricted by its credit agreement with SVB[266](index=266&type=chunk) Securities Authorized for Issuance under Equity Compensation Plan (as of Dec 31, 2021) | Plan Category | Securities to be Issued Upon Vesting | Securities Remaining for Future Issuance | | :--- | :--- | :--- | | Common Stock Plan | 331,039 | 1,191,383 | | Preferred Stock Plan | 34,000 | 320,065 | | **Total** | **365,039** | **1,511,448** | [Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=42&type=section&id=Item%207.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) This section analyzes CareCloud's 2021 financial performance, highlighting **33% revenue growth to $139.6 million**, a shift from **$8.8 million net loss to $2.8 million net income**, and **Adjusted EBITDA growth to $22.1 million** [Key Performance Measures (Non-GAAP)](index=43&type=section&id=Key%20Performance%20Measures%20%28Non-GAAP%29) Management uses non-GAAP measures like Adjusted EBITDA and adjusted net income, with **Adjusted EBITDA reaching $22.1 million** and **adjusted net income rising to $18.5 million** in 2021 Adjusted EBITDA Reconciliation | Metric | 2021 ($ in thousands) | 2020 ($ in thousands) | | :--- | :--- | :--- | | GAAP Net Income (Loss) | 2,836 | (8,813) | | Adjustments | 19,283 | 19,684 | | **Adjusted EBITDA** | **22,119** | **10,871** | Non-GAAP Adjusted Net Income Reconciliation | Metric | 2021 ($ in thousands) | 2020 ($ in thousands) | | :--- | :--- | :--- | | GAAP Net Income (Loss) | 2,836 | (8,813) | | Adjustments | 15,661 | 17,272 | | **Non-GAAP Adjusted Net Income** | **18,497** | **8,459** | Non-GAAP Adjusted Earnings Per Share | Metric | 2021 | 2020 | | :--- | :--- | :--- | | Non-GAAP Adjusted EPS | $1.24 | $0.63 | | Non-GAAP Adjusted Diluted EPS | $1.19 | $0.50 | [Results of Operations](index=54&type=section&id=Results%20of%20Operations) For 2021, net revenue increased **33% to $139.6 million**, driven by acquisitions, resulting in an operating income of **$3.5 million** and a net income of **$2.8 million** Comparison of Results of Operations (2021 vs. 2020) | Metric ($ in thousands) | 2021 | 2020 | Change (%) | | :--- | :--- | :--- | :--- | | Net Revenue | 139,599 | 105,122 | 33% | | Total Operating Expenses | 136,070 | 113,393 | 20% | | Operating Income (Loss) | 3,529 | (8,271) | N/A | | Net Income (Loss) | 2,836 | (8,813) | N/A | - The **33% revenue growth in 2021** was primarily driven by contributions from the **CCH, Meridian, and medSR acquisitions**[332](index=332&type=chunk) - Research and development expense decreased by **53% to $4.4 million in 2021** from **$9.3 million in 2020**, due to increased capitalized software projects and offshore maintenance resources[336](index=336&type=chunk) [Liquidity and Capital Resources](index=57&type=section&id=Liquidity%20and%20Capital%20Resources) CareCloud's liquidity improved significantly in 2021, with **cash from operations turning positive at $13.3 million**, **$10.3 million in cash**, and **$6.0 million in positive working capital** Summary of Cash Flows (2021 vs. 2020) | Cash Flow Activity ($ in thousands) | 2021 | 2020 | | :--- | :--- | :--- | | Net cash provided by (used in) operating activities | 13,334 | (892) | | Net cash used in investing activities | (23,146) | (31,469) | | Net cash (used in) provided by financing activities | (519) | 33,422 | - The significant improvement in operating cash flow was driven by **higher net income** and **changes in working capital**, despite increased operating expenses from acquisitions[357](index=357&type=chunk) - Cash used in investing activities decreased due to lower cash paid for acquisitions in **2021 ($12.6 million for medSR)** compared to **2020 ($23.7 million for CareCloud and Meridian)**[360](index=360&type=chunk) [Item 9A. Controls and Procedures](index=59&type=section&id=Item%209A.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were **not effective as of December 31, 2021**, due to a **material weakness in internal control over financial reporting** - Management concluded that **disclosure controls and procedures were not effective** as of December 31, 2021, due to a **material weakness in internal control over financial reporting**[370](index=370&type=chunk) - A **material weakness** was identified related to a lack of controls over the completeness and accuracy of key inputs for a non-routine transaction, which did not result in misstatements to filed financial statements[375](index=375&type=chunk)[420](index=420&type=chunk) - The company has a **remediation plan** to add controls for increased precision in reviewing key inputs for non-routine transactions, expected to be completed before the end of 2022[379](index=379&type=chunk) Part III [Items 10-14](index=61&type=section&id=Items%2010%2C%2011%2C%2012%2C%2013%2C%20and%2014) Information for Items 10-14 (Directors, Executive Compensation, Security Ownership, Related Transactions, and Accountant Fees) is incorporated by reference from the forthcoming 2022 Proxy Statement - Information for **Directors, Executive Compensation, Security Ownership, Related Transactions, and Accountant Fees** is incorporated by reference from the forthcoming **2022 Proxy Statement**[384](index=384&type=chunk)[385](index=385&type=chunk)[388](index=388&type=chunk) Part IV [Item 15. Exhibits and Financial Statement Schedules](index=62&type=section&id=Item%2015.%20Exhibits%20and%20Financial%20Statement%20Schedules) This section lists documents filed as part of the 10-K, including consolidated financial statements for 2021 and 2020, and an index of exhibits - This section contains the company's **audited consolidated financial statements** for the fiscal years ended **December 31, 2021 and 2020**[390](index=390&type=chunk) - An extensive list of **exhibits** is provided, including acquisition agreements, corporate governance documents, material contracts, and certifications[391](index=391&type=chunk) [Consolidated Financial Statements and Notes](index=68&type=section&id=Consolidated%20Financial%20Statements%20and%20Notes) The audited consolidated financial statements present CareCloud's financial position and results, highlighting **total assets of $140.8 million**, **net income of $2.8 million in 2021**, and an **adverse auditor opinion on internal controls** Consolidated Balance Sheet Highlights (as of Dec 31) | Metric ($ in thousands) | 2021 | 2020 | | :--- | :--- | :--- | | Total Current Assets | 35,559 | 44,819 | | Total Assets | 140,848 | 137,999 | | Total Current Liabilities | 29,562 | 29,024 | | Total Liabilities | 42,917 | 36,754 | | Total Shareholders' Equity | 97,931 | 101,245 | Consolidated Statement of Operations Highlights (Year Ended Dec 31) | Metric ($ in thousands) | 2021 | 2020 | | :--- | :--- | :--- | | Net Revenue | 139,599 | 105,122 | | Operating Income (Loss) | 3,529 | (8,271) | | Net Income (Loss) | 2,836 | (8,813) | | Net Loss Attributable to Common Shareholders | (11,216) | (22,690) | - The independent auditor, **Grant Thornton LLP**, issued an **adverse opinion on the company's internal control over financial reporting** as of December 31, 2021, due to a **material weakness** related to controls over a non-routine transaction[402](index=402&type=chunk)[418](index=418&type=chunk)

CareCloud, Inc. (MTBC) Q3 2021 Earnings Conference Call November 4, 2021 8:30 AM ET Company Participants Kimberly Blanche - General Counsel, VP of Compliance & Secretary Mahmud Haq - Founder and Executive Chairman Hadi Chaudhry - Chief Executive Officer, President, and Director Stephen Snyder - Chief Strategy Officer and Director Bill Korn - Chief Financial Officer Jerry Howell - CEO of MedMatica Conference Call Participants Jeffrey Cohen - Ladenburg Thalmann & Co. Allen Klee - Maxim Group Marc Wiesenberg ...

[PART I. FINANCIAL INFORMATION](index=6&type=section&id=PART%20I.%20FINANCIAL%20INFORMATION) This section presents the company's unaudited condensed consolidated financial statements and management's analysis for the period ended September 30, 2021 [Item 1. Condensed Consolidated Financial Statements](index=6&type=section&id=Item%201.%20Condensed%20Consolidated%20Financial%20Statements) This section presents the unaudited condensed consolidated financial statements, highlighting significant revenue growth and improved net income driven by acquisitions [Condensed Consolidated Balance Sheets](index=6&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) Total assets increased to **$142.5 million** by September 30, 2021, primarily due to goodwill and intangible assets from acquisitions, while liabilities also rose Condensed Consolidated Balance Sheet Highlights ($ in thousands) | Account | Sep 30, 2021 (Unaudited) | Dec 31, 2020 | | :--- | :--- | :--- | | **Assets** | | | | Cash | $8,313 | $20,925 | | Accounts receivable - net | $18,094 | $12,089 | | Intangible assets - net | $32,143 | $29,978 | | Goodwill | $60,661 | $49,291 | | **Total Assets** | **$142,509** | **$137,999** | | **Liabilities & Equity** | | | | Total current liabilities | $26,465 | $29,024 | | Borrowings under line of credit | $6,000 | $- | | Contingent consideration | $6,500 | $- | | **Total Liabilities** | **$45,458** | **$36,754** | | **Total Shareholders' Equity** | **$97,051** | **$101,245** | [Condensed Consolidated Statements of Operations](index=8&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) Net revenue for Q3 2021 increased **21%** to **$38.3 million**, leading to an operating income of **$1.4 million** and reduced net loss per common share Statement of Operations Summary ($ in thousands, except per share data) | Metric | Q3 2021 | Q3 2020 | 9 Months 2021 | 9 Months 2020 | | :--- | :--- | :--- | :--- | :--- | | **Net Revenue** | **$38,304** | **$31,639** | **$102,137** | **$73,085** | | Operating Income (Loss) | $1,425 | $(1,235) | $(362) | $(8,682) | | Net Income (Loss) | $1,505 | $(1,673) | $(686) | $(8,968) | | Net Loss Attributable to Common Shareholders | $(2,137) | $(5,903) | $(11,094) | $(19,118) | | Net loss per common share | $(0.15) | $(0.46) | $(0.77) | $(1.53) | [Condensed Consolidated Statements of Cash Flows](index=12&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Operating activities generated **$7.2 million** in cash for the nine months ended September 30, 2021, offsetting significant cash used in investing activities for acquisitions Cash Flow Summary for Nine Months Ended Sep 30 ($ in thousands) | Cash Flow Activity | 2021 | 2020 | | :--- | :--- | :--- | | Net cash provided by (used in) operating activities | $7,210 | $(4,333) | | Net cash used in investing activities | $(19,851) | $(28,772) | | Net cash provided by financing activities | $1,272 | $36,139 | | **Net (Decrease) Increase in Cash** | **$(11,612)** | **$2,846** | [Notes to Condensed Consolidated Financial Statements](index=14&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) Detailed notes cover the company's healthcare IT business, recent acquisitions like medSR, accounting policies, and disaggregated revenue sources, showing growth in professional services - The company operates as a healthcare information technology firm providing a suite of proprietary cloud-based solutions, including RCM, PM, and EHR, to healthcare providers across the U.S. It leverages offshore offices in Pakistan and Sri Lanka for client support and operations[30](index=30&type=chunk) - On June 1, 2021, the company acquired MedMatica and its subsidiary SRS (renamed medSR) for **$10 million in cash** plus a working capital adjustment and potential earn-outs up to **$13 million**, expanding specialty consulting services[41](index=41&type=chunk)[42](index=42&type=chunk) Disaggregation of Revenue (Nine Months Ended Sep 30, $ in thousands) | Revenue Source | 2021 | 2020 | | :--- | :--- | :--- | | Technology-enabled business solutions | $80,075 | $61,138 | | Professional services | $10,978 | $1,278 | | Medical practice management services | $9,341 | $8,926 | | Other | $1,743 | $1,743 | | **Total** | **$102,137** | **$73,085** | [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=35&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management attributes **40% revenue growth** for the first nine months of 2021 to acquisitions, achieving **$16.0 million in Adjusted EBITDA** and maintaining solid liquidity [Results of Operations](index=43&type=section&id=Results%20of%20Operations) Net revenue for Q3 2021 increased **21%** to **$38.3 million**, with nine-month revenue up **40%** to **$102.1 million**, primarily due to acquisitions and reduced R&D expenses - Revenue for the nine months ended September 30, 2021, includes approximately **$63.1 million** from customers acquired in the medSR, CCH, and Meridian acquisitions[218](index=218&type=chunk) - Research and development expense decreased by **79% in Q3 2021** and **37% in the nine-month period** year-over-year, due to capitalizing **$5.3 million** in development costs for new technology[222](index=222&type=chunk) Operating Expenses Comparison (Nine Months Ended Sep 30, $ in thousands) | Expense Category | 2021 | 2020 | % Change | | :--- | :--- | :--- | :--- | | Direct operating costs | $62,719 | $45,842 | 37% | | Selling and marketing | $6,469 | $4,778 | 35% | | General and administrative | $17,814 | $17,176 | 4% | | Research and development | $4,328 | $6,846 | (37)% | | **Total operating expenses** | **$102,499** | **$81,767** | **25%** | [Key Performance Measures](index=37&type=section&id=Key%20Performance%20Measures) Adjusted EBITDA for the nine months ended September 30, 2021, significantly increased to **$16.0 million** from **$5.2 million** in the prior year, driven by revenue growth and cost management Adjusted EBITDA Reconciliation ($ in thousands) | Metric | Q3 2021 | Q3 2020 | 9 Months 2021 | 9 Months 2020 | | :--- | :--- | :--- | :--- | :--- | | GAAP net income (loss) | $1,505 | $(1,673) | $(686) | $(8,968) | | Stock-based compensation | $1,004 | $1,763 | $4,006 | $4,951 | | Depreciation & amortization | $3,547 | $3,206 | $9,505 | $6,944 | | Transaction & integration costs | $269 | $609 | $1,118 | $1,709 | | Other adjustments | $269 | $(11) | $1,585 | $532 | | **Adjusted EBITDA** | **$6,674** | **$4,214** | **$16,018** | **$5,170** | [Liquidity and Capital Resources](index=46&type=section&id=Liquidity%20and%20Capital%20Resources) The company maintained strong liquidity with **$9.3 million in cash** and **$9.9 million in working capital**, supported by **$7.2 million** in operating cash flow and an increased **$20 million** credit facility - The company generated positive cash flow from operations of **$7.2 million** for the nine months ended September 30, 2021[234](index=234&type=chunk)[240](index=240&type=chunk) - During the first quarter of 2021, the exercise of 858,000 warrants provided net proceeds of approximately **$6.4 million**[236](index=236&type=chunk) - The company's credit line with Silicon Valley Bank (SVB) was increased from **$10 million to $20 million** and extended through October 2023[80](index=80&type=chunk) [Item 3. Quantitative and Qualitative Disclosures about Market Risk](index=48&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) As a smaller reporting company, the registrant is exempt from providing quantitative and qualitative disclosures about market risk - As a smaller reporting company defined by 17 C.F.R. 229.10(f)(1), the registrant is not required to provide the information requested under this item[248](index=248&type=chunk) [Item 4. Controls and Procedures](index=48&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were effective as of September 30, 2021, with no material changes to internal control over financial reporting during the quarter - The Chief Executive Officer and Chief Financial Officer concluded that the company's disclosure controls and procedures were effective as of September 30, 2021[251](index=251&type=chunk) - No material changes in internal control over financial reporting occurred during the most recent fiscal quarter[252](index=252&type=chunk) [PART II. OTHER INFORMATION](index=49&type=section&id=PART%20II.%20OTHER%20INFORMATION) This section provides details on legal proceedings, risk factors, equity sales, and exhibits filed with the report [Item 1. Legal Proceedings](index=49&type=section&id=Item%201.%20Legal%20Proceedings) The company's subsidiary, MTBC Acquisition Corp., is involved in an arbitration proceeding with RPRWC, facing claimed damages of approximately **$11 million** plus costs - The company is involved in an arbitration demand filed by Randolph Pain Relief and Wellness Center ("RPRWC") against its subsidiary, MTBC Acquisition Corp. ("MAC")[96](index=96&type=chunk) - RPRWC's claimed damages have fluctuated, most recently estimated at approximately **$11 million** plus costs, which MAC intends to vigorously defend against[98](index=98&type=chunk) [Item 1A. Risk Factors](index=49&type=section&id=Item%201A.%20Risk%20Factors) No material changes to previously disclosed risk factors were reported, with investors directed to the Annual Report on Form 10-K for a comprehensive discussion - The report directs investors to the Risk Factors section of the Annual Report on Form 10-K filed on February 25, 2021, for a comprehensive discussion of potential risks[257](index=257&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=49&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) This item is not applicable for the current reporting period - Not applicable[258](index=258&type=chunk) [Item 6. Exhibits](index=49&type=section&id=Item%206.%20Exhibits) This section lists exhibits filed with the Form 10-Q, including CEO and CFO certifications and XBRL interactive data files - Exhibits filed include certifications from the Principal Executive Officer and Principal Financial Officer (Exhibits 31.1, 31.2, 32.1, 32.2) and XBRL data files (Exhibits 101 series)[262](index=262&type=chunk)

Financial Data and Key Metrics Changes - CareCloud reported record revenue of $34.1 million for Q2 2021, a 74% increase from $14.5 million in Q2 2020, and 6% above the previous all-time high [37] - The annual revenue run rate is now $136 million, which is 29% higher than 2020 and 111% higher than 2019 [37] - The net loss for Q2 2021 was $227,000, significantly reduced from a net loss of $4.8 million in the same period last year [38] - Adjusted EBITDA for Q2 2021 was $5.7 million, representing 17% of revenue, a substantial increase from $191,000 in Q2 2020 [40] Business Line Data and Key Metrics Changes - Approximately 81% of revenue in the first half of 2021 was driven by technology assets, with 52% from clients using the full technology suite [41][42] - The company is focusing on expanding its service offerings, including revenue cycle management and robotic process automation, to existing clients [56] Market Data and Key Metrics Changes - The company is experiencing a shift towards telehealth services, with 63% of practices reporting frequent to occasional telehealth use post-COVID, down from 93% during the pandemic [66] - The company is targeting larger multi-specialty hospital groups and specialties with higher average revenue per claim, such as orthopedics [60] Company Strategy and Development Direction - CareCloud is focused on integrating and cross-selling acquired assets while driving organic growth [7] - The recent acquisition of medSR aims to accelerate growth in the hospital market, which has not been a significant focus previously [18][19] - The company plans to leverage partnerships with existing EHR vendors rather than compete directly against them [19] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about continued strong momentum in the second half of 2021, raising full-year revenue guidance to $135 to $138 million [46] - The company anticipates its seventh consecutive year of annual revenue growth of 25% or more [47] - Management noted that the operating environment is returning to pre-COVID levels, with a mix of telehealth services continuing to be utilized [64] Other Important Information - The company has increased its investment in sales and marketing significantly, from $1.5 million in 2019 to $6.6 million in 2020, with plans for a further 30% to 40% increase [25] - Cash flow from operations for Q2 2021 was approximately $1.1 million, but would have been $5.1 million without a one-time payment related to a previous acquisition [45] Q&A Session Summary Question: Can you discuss the commercial organization and sales pipeline? - Management indicated steady sales and upsell activities, with optimism about increasing overall sales bookings for the year [52][53] Question: How normalized is the operating environment regarding COVID? - Management noted that patient volumes are almost back to pre-COVID levels, with a significant increase in telehealth utilization during the pandemic [64][66] Question: What is the impact of the recent acquisition of medSR? - The acquisition is expected to enhance capabilities in the hospital market, with a focus on cross-selling revenue cycle management services [19][84] Question: How is CareCloud addressing cybersecurity concerns? - The company has contracted an external security firm to monitor network traffic and ensure compliance with industry standards [88] Question: What challenges exist in accessing decision-makers in the hospital market? - Management acknowledged the difficulty in reaching decision-makers but emphasized the importance of leveraging established relationships through the medSR acquisition [21][100]

0 Q2 2021 Results Nasdaq Global Market: MTBC, MTBCP Safe Harbor Statements This presentation contains forward-looking statements within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. These statements relate to anticipated future events, future results of operations or future financial performance. In some cases, you can identify forward-looking statements by terminology such as "anticipate", "believe", "continue", "could", "estimate", "expect", "goals ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Form 10-Q (Mark one) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 2021 or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission File Number 001-36529 CareCloud, Inc. (Exact name of registrant as specified in its charter) Delaware 22-3832302 (State or other jurisdiction of ...

CareCloud, Inc. (MTBC) Q1 2021 Earnings Conference Call May 6, 2021 8:30 AM ET Company Participants Kim Blanche - General Counsel Mahmud Haq - Founder & Executive Chairman Hadi Chaudhry - CEO & President Stephen Snyder - CSO Bill Korn - CFO Karl Johnson - Chief Growth Officer Conference Call Participants Jeffrey Cohen - Ladenburg Thalmann Richard Baldry - ROTH Capital Marc Wiesenberger - B. Riley Securities Allen Klee - Maxim Group Gene Mannheimer - Colliers Securities Kevin Dede - H.C. Wainwright David Lar ...

0 Q1 2021 Results Nasdaq Global Market: MTBC, MTBCP Safe Harbor Statements This presentation contains forward-looking statements within the meaning of the federal securities laws. These statements relate to anticipated future events, future results of operations or future financial performance. In some cases, you can identify forward-looking statements by terminology such as "anticipate", "believe", "continue", "could", "estimate", "expect", "goals", "intend", "likely", "may", "might", "plan", "potential", ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Title of each class Trading Symbol(s) Name of each exchange on which registered Common Stock, par value $0.001 per share MTBC Nasdaq Global Market 11% Series A Cumulative Redeemable Perpetual Preferred Stock, par value $0.001 per share MTBCP Nasdaq Global Market Form 10-Q (Mark one) [X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2021 or [ ] TRANSITION ...

February 2021 Investor Presentation A leading healthcare technology company with a complete suite of proprietary, cloudbased solutions for healthcare providers NASDAQ Global Market: MTBC, MTBCP Safe Harbor Statements This presentation contains forward-looking statements within the meaning of the federal securities laws. These statements relate to anticipated future events, future results of operations or future financial performance. In some cases, you can identify forward-looking statements by terminology ...