OptimizeRx(US:OPRX)2025-11-07 21:03Financial Performance - Net revenue for the three months ended September 30, 2025, increased to $26,067,000, up 22.5% from $21,309,000 for the same period in 2024[13] - Gross profit for the nine months ended September 30, 2025, was $49,495,000, a 32.4% increase compared to $37,355,000 for the same period in 2024[13] - The company reported a net income of $779,000 for the three months ended September 30, 2025, compared to a net loss of $9,124,000 for the same period in 2024[13] - For the nine months ended September 30, 2025, OptimizeRx Corporation reported a net income of $112, compared to a net loss of $20,032 for the same period in 2024[18] - Net revenue increased by 22% to $26,067 for the three months ended September 30, 2025, and by 29% to $77,190 for the nine months ended September 30, 2025, driven by DTC and DAAP related sales[120] Assets and Liabilities - Total assets as of September 30, 2025, decreased to $170,321,000 from $171,168,000 as of December 31, 2024, representing a decline of approximately 0.5%[11] - Cash and cash equivalents increased to $19,519,000 as of September 30, 2025, from $13,380,000 as of December 31, 2024, reflecting a growth of 46.0%[11] - The current portion of long-term debt rose to $3,300,000 as of September 30, 2025, compared to $2,000,000 as of December 31, 2024, indicating a 65.0% increase[11] - Long-term debt, net, decreased to $24,801 as of September 30, 2025, from $30,816 as of December 31, 2024[39] - The company had total current assets of approximately $56,320, resulting in working capital of approximately $37,854 and a current ratio of approximately 3.0 to 1[134] Equity and Stock - Total stockholders' equity increased to $122,263,000 as of September 30, 2025, from $116,998,000 as of December 31, 2024, marking a growth of 4.0%[11] - The weighted average number of shares outstanding for basic earnings per share increased to 18,576,199 for the three months ended September 30, 2025, compared to 18,323,542 for the same period in 2024[13] - The company had 166,666,667 shares of common stock authorized as of September 30, 2025, with 18,592,442 shares outstanding[54] - During the quarter ended September 30, 2025, the company issued 22,028 shares of common stock, receiving proceeds of $338[55] - The total intrinsic value of outstanding stock options at September 30, 2025, was $18,519[62] Expenses and Costs - Operating expenses for the three months ended September 30, 2025, were $15,466,000, down 29.9% from $22,009,000 in the same period of 2024[13] - Stock-based compensation for the nine months ended September 30, 2025, was $5,002, down from $8,530 in 2024[18] - Total lease cost for the nine months ended September 30, 2025, was $182, slightly down from $188 in the same period of 2024[52] - Cost of revenues as a percentage of revenue decreased to approximately 33% for the three months ended September 30, 2025, from approximately 37% in 2024[121] - Operating expenses decreased by approximately 30% to $15,466 for the three months ended September 30, 2025, and by approximately 15% to $46,371 for the nine months ended September 30, 2025[124] Cash Flow - The company experienced a net cash provided by operating activities of $11,627 for the nine months ended September 30, 2025, an increase from $4,691 in 2024[18] - The net increase in cash from operating activities was primarily due to a $20,144 increase in net income, partially offset by a $3,528 decrease in noncash expenses related to stock-based compensation[137] - Investing activities used $138 in cash during the nine months ended September 30, 2025, a decrease from $330 in the same period in 2024, mainly due to reduced capitalization of internally developed software[138] - Financing activities used $5,350 in cash during the nine months ended September 30, 2025, compared to $2,087 in the same period in 2024, primarily due to increased repayments of long-term debt[139] Revenue Recognition - Revenue recognized over time for the nine months ended September 30, 2025, was $77,017, up from $54,189 in 2024, indicating a growth of about 42.1%[79] - The company recognized $250 and $735 in revenue from contracts with Eversana for the three and nine months ended September 30, 2025, respectively, compared to $200 and $272 in 2024[84] - Deferred revenue as of September 30, 2025, was $395, down from $473 at December 31, 2024[77] - The allowance for credit losses at September 30, 2025, was $260, compared to $339 at the same date in 2024, showing a reduction of approximately 23.2%[81] Customer and Market Insights - The top five customers represented approximately 49% of the company's revenue for the year ended December 31, 2024[109] - The company is transitioning its Dynamic Audience Activation Platform (DAAP) customers to a subscription-based model, which is expected to improve margins and revenue predictability[108] - The percentage of total revenue attributable to top 20 pharmaceutical manufacturers decreased to 56% in 2025 from 65% in 2024, indicating growth from other customers[115] - Net revenue retention was 120% for the twelve months ended September 30, 2025, down from 127% in 2024, reflecting strong organic growth despite the lack of inorganic benefits from acquisitions[116] - Average revenue per top 20 pharmaceutical manufacturer increased to $3,073 for the twelve months ended September 30, 2025, compared to $2,874 for the same period in 2024[114] Debt and Financing - The company entered into a Financing Agreement on October 11, 2023, providing a term loan of $40 million, partially financing the Medicx Health transaction[39] - The term loan bears interest at 12.9%, with an effective interest rate of 15.9% for the three months ended September 30, 2025[46] - The company repaid approximately $2,000,000 of its Term Loan on October 29, 2025, reducing the outstanding balance to $26,790,000[98] - The company believes that funds generated from operations and existing cash will be sufficient to finance current operations and meet obligations under the Term Loan for the next 12 months[135] Regulatory and Compliance - The company is currently evaluating the impact of adopting ASU 2023-09, which is expected to result in additional disclosures but will not materially affect financial position or results of operations[143] - Management is committed to remediating a previously identified material weakness in internal control over financial reporting related to data accuracy from third-party service organizations[153] - There were no material changes in risk factors from those previously reported in the Annual Report for the year ended December 31, 2024[163]