Business Combination and Company Overview - VSee Health completed a Business Combination on June 24, 2024, merging with VSee Lab and iDoc, and subsequently changed its name to VSee Health, Inc.[286] - The company is classified as an "emerging growth company" and a "smaller reporting company," allowing it to take advantage of certain reporting exemptions[294][296]. Market Potential and Growth Strategy - The telehealth market is experiencing rapid transformation, with significant growth potential as major customers seek to enhance capabilities, indicating a strong future market outlook[298]. - The company aims to leverage industry relationships to expand its customer base, particularly within hospital systems, which are expected to drive most of the growth in telehealth utilization[299]. - VSee Health's technology solutions aim to address existing limitations in telehealth, such as integration challenges and the need for optimized backend software coordination[300]. - The company emphasizes the importance of innovation and new product offerings to capture a larger share of the telehealth market, which currently represents less than 1% of total healthcare spending[301]. Revenue Recognition and Financial Reporting - The company recognizes revenue in accordance with ASC 606, focusing on the transfer of promised goods or services to customers[306]. - Revenue from third-party payors is presented net of an estimated provision for contractual adjustments, with patient revenues net of service credits and expected credit losses[326]. - The Company recognizes revenue for telemedicine services when performance obligations are met, with payments from Medicare, Medicaid, and commercial insurance providers based on established rates[329][330][331]. - Subscription services are treated as a series of distinct performance obligations, with revenue recognized over time as services are delivered[316]. - The Company estimates variable consideration for revenue recognition based on expected value or the most likely amount method, ensuring that significant reversals in revenue recognized are unlikely[333]. - Fixed monthly fees are charged for telemedicine consultation services, EEG professional interpretation services, and platform software services, providing a predetermined number of physician hours[336]. - Deferred revenue consists of unamortized nonrefundable upfront fees, classified as current and non-current based on expected revenue recognition timing[316]. - The Company evaluates the nature of professional services arrangements to determine appropriate timing for revenue recognition, ensuring it reflects the transfer of goods or services[323]. - Performance obligations for patient fee services are satisfied when professional medical services are rendered, with revenue recognized upon satisfaction of these obligations[324]. Financial Performance - Revenue for the year ended December 31, 2024, was $10,421,352, an increase of $4,655,463 or 81% compared to $5,765,889 in 2023[347]. - The acquisition of iDoc contributed $2,217,733 or 49% of the total revenue increase, primarily from patient and telehealth fees[349]. - Operating expenses increased by $63,622,142 or 1,115%, driven by goodwill impairment charges of $56,675,210 and higher general and administrative expenses[355]. - Net loss for the year ended December 31, 2024, was $57,702,015, an increase of $53,976,561 or 1,449% compared to the previous year[357]. - Cash used in operating activities was $5,789,542 for the year ended December 31, 2024, compared to $632,595 in 2023[362]. - Cash provided by financing activities for the year ended December 31, 2024, was $6,023,067, primarily from proceeds of the Quantum Note and Convertible Note[368]. - The company had an accumulated deficit of $67,703,873 as of December 31, 2024, raising substantial doubt about its ability to continue as a going concern[359]. - Cash on hand as of December 31, 2024, was $326,115, insufficient to meet operating cash needs for the next 12 months[360]. - The increase in cost of revenues for the year ended December 31, 2024, was $1,310,577 or 68%, primarily due to the acquisition of iDoc[351]. Investment and Valuation - The Company uses a fair value hierarchy to measure investments, prioritizing unadjusted quoted prices in active markets for identical assets or liabilities[338]. - Future capital requirements will depend on growth rate, contract renewals, and market acceptance of telehealth services[363].
VSee Health, Inc.(VSEE) - 2024 Q4 - Annual Report