Ontrak(US:OTRK)2025-05-20 20:08Revenue Performance - Revenue for Q1 2025 was $2.0 million, a decrease of 25% from $2.7 million in Q1 2024, primarily due to a decrease in total average enrolled members[157] - Total revenue decreased by $0.7 million, or 25%, to $2.017 million for the three months ended March 31, 2025, compared to $2.680 million in the same period of 2024[169] Operating Expenses and Loss - Total operating expenses for Q1 2025 were $6.6 million, up from $6.0 million in Q1 2024, with increases in research and development and general administrative expenses[168] - Total operating expenses increased by $0.6 million, or 10%, to $6.596 million for the three months ended March 31, 2025, driven by increases in research and development and general and administrative costs[172] - Operating loss for Q1 2025 was $(5.9) million, compared to $(4.3) million in Q1 2024, indicating a worsening financial performance[168] - Operating loss increased by $1.577 million, or 37%, to $5.850 million for the three months ended March 31, 2025[172] Cash Flow and Liquidity - Cash flow from operations improved to $(2.7) million in Q1 2025 from $(3.3) million in Q1 2024, attributed to increased collections on accounts receivable and efficient cash flow management[158] - Net cash used in operating activities improved to $2.723 million for the three months ended March 31, 2025, compared to $3.259 million in the same period of 2024[181] - Total cash as of March 31, 2025, was $4.1 million, with negative working capital of approximately $3.1 million[175] - The company was not in compliance with consolidated liquidity or consolidated recurring revenue covenants as of March 31, 2025, raising substantial doubt about its ability to continue as a going concern[178] Member Enrollment and Outreach - Callable outreach pool for WholeHealth+ increased by 45% to 7,319 members as of March 31, 2025, compared to 5,057 members a year earlier[159] - Callable outreach pool for Ontrak Engage reached 22,152 members as of March 31, 2025, reflecting the program's launch on an à la carte basis in early 2024[160] - The company aims to increase eligible members by signing new contracts and identifying more eligible members within existing contracts[161] Debt and Financing - The company entered into an agreement with Acuitas to purchase up to $5.0 million in Demand Notes and $5.0 million in senior secured non-convertible promissory notes[153] - Interest expense, net increased by $858,000, or 469%, to $183,000 for the three months ended March 31, 2025, due to a higher average total outstanding loan balance[174] - The company had $13.5 million of secured debt outstanding as of March 31, 2025, with additional borrowing of $0.5 million under the Keep Well Agreement on May 9, 2025[176] Customer Relations - A health plan customer notified the company of its intent to discontinue services after December 2024, leading to disenrollment of related members[152] - The company has a minimum guarantee of $5.8 million over a two-year period with a customer, extended to June 30, 2025, with $4.6 million invoiced as of March 31, 2025[163] Cost of Revenue and Profitability - Cost of revenue increased by $0.3 million, or 30%, to $1.271 million for the three months ended March 31, 2025, primarily due to higher employee compensation and benefit costs[170] - Gross profit decreased by $1.0 million to $746,000, with gross profit margin declining by 27% to 37% for the three months ended March 31, 2025[171]