Financial Performance - Total revenues for the three months ended September 30, 2025, were $3,980,655, an increase of 18.6% compared to $3,354,437 for the same period in 2024[20] - Subscription fees decreased to $894,514 for the three months ended September 30, 2025, down from $1,037,457 in 2024, representing a decline of 13.8%[20] - Net loss for the three months ended September 30, 2025, was $289,745, compared to a net loss of $53,922,561 for the same period in 2024[20] - Gross margin for the nine months ended September 30, 2025, was $5,521,759, up from $4,796,441 in 2024, indicating a growth of 15.1%[20] - For the nine months ended September 30, 2025, VSee Health reported a net loss of $6,862,468, compared to a net loss of $54,493,913 for the same period in 2024[23] Assets and Liabilities - Total current assets increased to $3,718,385 as of September 30, 2025, from $3,020,967 as of December 31, 2024, reflecting a growth of 23.1%[17] - Total liabilities rose to $24,282,620 as of September 30, 2025, compared to $20,010,976 as of December 31, 2024, marking an increase of 21.7%[18] - The company reported a total stockholders' deficit of $(5,575,498) as of September 30, 2025, compared to $(18,488) as of December 31, 2024[18] - Cash balance increased to $472,759 as of September 30, 2025, from $326,115 as of December 31, 2024, reflecting a growth of 45%[17] Goodwill and Impairment - The company experienced a goodwill impairment charge of $56,675,210 in 2024, which was not present in 2025[23] - The Company recorded non-cash goodwill impairment charges of $56,675,210 for the year ended December 31, 2024, due to the fair value of the Telehealth Services reporting unit being less than its carrying value[101] - The Company recognized a $300,000 goodwill impairment charge related to the acquisition of iDoc during the quarter ended September 30, 2024[34] Revenue Recognition - Revenue from telemedicine care services is recognized when administrative, business, and medical records are provided as required[75] - Subscription revenue is recognized over time as customers receive and consume services, with each module being a distinct performance obligation[61] - The Company’s telemedicine services are reimbursed by Medicare, Medicaid, and commercial insurance providers, with reimbursement rates generally lower than billed amounts[71][73] Contracts and Agreements - The Company has service contracts with hospitals typically ranging from two to three years, with an automatic renewal process[56] - The Company’s contracts typically contain cancellation clauses with advance notice, indicating no material outstanding commitments for future revenues beyond one year[57] - The Company won new contracts with larger hospitals and entered new markets, indicating positive revenue growth potential[32] Financial Adjustments and Restatements - The Company identified errors in previously issued financial statements, leading to a restatement of financial results for the period ended September 30, 2024, including a $940,130 accrual for sales and use taxes[33] - Adjustments included a $1,590,596 reduction in acquired accounts receivable due to uncollectible amounts, impacting goodwill impairment expense[35] - The Company recorded a $639,732 decrease in prepaid income taxes and a $414,542 increase in income taxes payable as part of the restatement adjustments[36] Shareholder Equity and Stock Issuance - The weighted average number of common shares outstanding increased to 16,549,357 for the three months ended September 30, 2025, compared to 15,077,548 in 2024[20] - The company issued shares as part of stock grants to vendors amounting to $98,000 in 2024[24] - The fair value of shares issued in the iDoc acquisition was $68,907,052[24] - The company issued shares to acquire non-controlling interest in TAD amounting to $325,279[24] Debt and Financing Activities - The Company reported a net cash provided by financing activities of $1,689,052 for the nine months ended September 30, 2025, compared to $5,045,235 in 2024[23] - The Company entered into a Master Business Loan Agreement for up to $2,500,001 in advances from Change Capital Holdings I, LLC[161] - The Company has an outstanding balance of $456,097 on the revolving line of credit as of September 30, 2025, with interest recorded as $15,886 for the three months ended September 30, 2025[168] Lease Obligations - Operating lease liabilities as of September 30, 2025, totaled $289,264, with a current portion of $85,575 and a long-term portion of $203,689[114] - The weighted average remaining lease term for operating leases decreased from 3.6 years as of December 31, 2024, to 2.8 years as of September 30, 2025[119] - The Company expects future minimum lease payments totaling $372,330, with the largest payment of $131,440 due in 2026[115] Accounting and Reporting - The Company continues to evaluate the impact of new accounting pronouncements, including ASU 2023-09 and ASU 2024-03, on its financial disclosures and operations[105][107] - The Company has determined that its Public warrants and other specified warrants meet equity classification under ASC 815, impacting the financial reporting of these instruments[98]
Digital Health Acquisition (DHAC) - 2025 Q3 - Quarterly Report