Q4 2023 Sharecare Inc Earnings Call

Operator: He's got a camera. Good day, everyone. And welcome to the Sharecare fourth quarter and full year 2023 earnings call. All participants are currently in a listen-only mode. After today's presentation, there will be an opportunity to ask questions. To ask a question at that time, please press the star and then one on the touch screen.

Right right right.

Yeah.

None: Good day, everyone and welcome to the share care fourth quarter and full year 2023 earnings call and webcast.

None: All participants are currently in a listen only mode.

None: After todays presentation, there will be an opportunity to ask questions.

None: To ask a question at that time, Please press star and then one using a touchtone telephone withdrawal from the queue. You May press star and two to remove yourself from the list.

Operator: Withdrawal from the queue; you may press star and two to remove yourself from, A call is being recorded and will be available on. On today's call, we have Justin Ferrero, President and Chief Financial Officer. Jeff Arnold.

None: Today's call is being recorded and will be available on the company's website.

On today's call we have Mr. Brent Layton.

Brent Davis Layton: He's executive officer Mrs.

Brent Davis Layton: Mr. Justin Pereiro, President and Chief Financial Officer, and Jeff Arnold Executive Chairman will join for the Q&A.

Operator: Chairman. We'll go on to the, Before we begin, we would like to remind you that certain statements made during this call will be forwarded in compliance with the Safe Harbor provisions of the Private Securities Litigation Reform, which includes statements regarding Strategic Review. Cost Savings, New Capabilities, Pipelines, and Future Expeditions. These forward-looking statements are subject to various risks and uncertainties and reflect our current expectations and information currently available. Although we believe these expectations are reasonable, we undertake no obligation to revise any statement to reflect changes that will occur after, from these four linking statements are discussed in more detail in our filings with the SEC and the risk factors section. Okay, for the year ended December. In addition, please note that the company will be discussing certain non-GAAP financial measures we believe are important in evaluating. Details on the relationship between these non-GAAP measures and the most comparable GAAP measures can be found in the press release that is posted on. I'd now like to turn the floor over to Mr. Brent Layton. Brent, please go ahead.

Brent Davis Layton: Before we begin we would like to remind you that certain statements made during this call will be forward looking statements within the meaning of the safe Harbor provisions of the private Securities Litigation Reform Act of 1995.

Which includes statements regarding the strategic review expected cost savings new capabilities pipelines and future expectations.

Brent Davis Layton: These forward looking statements are subject to various risks and uncertainties and reflect our current expectation based on our beliefs assumptions and information currently available to us.

Brent Davis Layton: Although we believe these expectations are reasonable we undertake no obligation to revise any statement to reflect changes will occur after this call.

Brent Davis Layton: Descriptions of some of the factors that could cause actual results to differ materially from these forward looking statements are discussed in more detail in our filings with the SEC, including the risk factors section of our Form 10-K for the year ended December 31 2023.

Brent Davis Layton: In addition, please note that the company will be discussing certain non-GAAP financial measures. We believe are important in evaluating performance.

Brent Davis Layton: Details on the relationship between these non-GAAP measures and the most comparable GAAP measures and reconciliation of historical non-GAAP financial measures.

Brent Davis Layton: Can be found in the press release that is posted on the company's website.

Brent Davis Layton: I'd now like to turn the floor over to Mr. Brent Layton right. Please go ahead.

Brent Davis Layton: Thank you Jamie and good afternoon.

Brent Davis Layton: Thank you, Jamie, and good afternoon. And thank you for joining us for my first earnings call as CEO of Sharecare. We appreciate you spending time with us today to learn more about Sharecare's fourth quarter and full year 2023 financial results, as well as the status of our strategic review. And, most importantly, where those innovative companies are headed.

Brent Davis Layton: And thank you for joining us for my first earnings call as CEO of <unk>.

Brent Davis Layton: We appreciate you spending time with us today to learn more about <unk> fourth quarter and full year 2023 financial results as well as the status of our strategic review and more.

Brent Davis Layton: Most importantly were those innovative company is headed.

Brent Davis Layton: Since joining Sharecare's Board of Directors over a year ago, I've learned a great deal about our technology and the opportunities that lie ahead. My belief in this company has only grown since I became Sharecare's CEO on January 2nd. In many ways, that is fueled by more than 75 meetings I've had during the last three months with dozens of organizations, including our current clients and over 50 potential customers and partners. I've seen firsthand their enthusiasm for the value we currently provide, as well as their considerable interest in the solutions we can bring to their businesses and the populations they serve. They're impressed by our innovation.

Brent Davis Layton: Since joining <unk> board of directors over a year ago I've learned a great deal about our technology and the opportunities that lie ahead.

None: I believe this company has only grown since I became <unk> CEO of January 2nd.

None: In many ways that is fueled by fueled by more than 75 meetings I've had during the last three months with dozens of organizations, including our current clients.

None: 50 potential customers and partners.

None: I've seen firsthand their enthusiasm for the value. We currently provide as well as the considerable interest in the solutions, we can bring to their businesses.

None: And the populations they serve.

None: They were impressed by our innovation they are inspired by our creativity and they appreciate our collaborative approach to partnerships.

Brent Davis Layton: They are inspired by our creativity, and they appreciate our collaborative approach to partnership and our commitments to solution-based opportunities. The bottom line, our pipeline, and our future are strong, healthy, and profitable. Before you hear from Justin, I think it's important to highlight a few things.

None: And our commitments to solution based opportunities the bottom line.

None: Pipeline, our future strong healthy and profitable.

None: Before you hear from Justin I think it's important to highlight a few things first share care made good on his commitment to achieve cash flow breakeven by the end of 2023, we have no debt a strong balance sheet.

Brent Davis Layton: First, Sharecare made good on its commitment to achieve cash flow breakeven by the end of 2023. We have no debt, a strong balance sheet, and made the right investments, which positions us for strong growth. As I help scale this company, I will continue to prioritize one of Sharecare's guiding business principles: the importance of profitability. To take that a step further, we have adopted new rules of engagement.

None: Made the right investments, which positions us for strong growth.

None: As I helped scale of this company our continued prioritize one is sure Chris guarding business principles.

None: The importance of profitability.

None: To take that a step further we have adopted new rules of engagement.

Brent Davis Layton: We'll only work with committed partners and clients who are aligned with us in driving meaningful outcomes, leveraging our solutions so all parties succeed, especially the people in the communities we serve. That's why, in Q4, Sharecare eliminated non-performing disputed contracts with a client that has historically affected our forecast. This impacted Q4 revenue by a reduction of approximately $14 million, which included a write-down of eliminated contracts, and reduced and adjusted EBITDA by approximately $6 million.

None: Will only work with committed partners and clients, who are aligned with us and driving meaningful outcomes leveraging our solutions. So all parties to see especially the people and the communities we serve.

None: That's why in Q4 share care eliminated nonperforming disputed contracts with a client that has historically affected our forecasting.

None: This impacted Q4 revenue by a reduction of approximately $14 million, which.

None: Which included a write down of eliminated contracts, reducing adjusted EBITDA by approximately $6 million.

Brent Davis Layton: Eliminating these disputed contracts for this client enables us to focus our time and resources on productive, collaborative relationships that recognize Sharecare's commitment to innovation, creativity, solution-based technology, and profitable growth. And it will provide our investors with more predictability and reliability in our financial forecasting and results going forward. With that in mind, we reported revenues of $105 million for the quarter and $445 million for 2023, and adjusted EBITDA of $3 million in the quarter and $16.5 million for the full year.

None: Eliminating these disputed contract for this client enables us to focus our time and resources on productive collaborative relationships that recognize <unk> commitment to innovation.

<unk> solution based technology and profitable growth and.

None: And it will provide our investors with more predictability and reliability in our financial forecasting and results going forward.

None: With that context, we reported revenues of $105 million for the quarter and 445 million for 2023, and adjusted EBITDA of 3 million in the quarter and $16 5 million for the full year.

Brent Davis Layton: Our enterprise channel performed in line with our expectations for Q4 and delivered an excellent quarter and had its strongest annual financial performance to date. Life Sciences growth in Q4 compared to the year prior can be attributed to long-term customers increasing their spend with us, and we believe this suggests a rebound from the softness in the digital advertising that the pharma industry has seen the last several quarters in 2023. I'm sure you have questions about our strategic review discussed in our press release two weeks ago. Sharecare's Special Committee of Independent Members of the Board of Directors, supported by legal and financial advisors, are continuing to actively evaluate multiple proposals for a potential sale transaction, as well as developing alternative value creation opportunities. The special committee is dedicated to being methodical in its review with a goal of maximizing shareholder value, and we will communicate the board's decision at the conclusion of the review process.

None: Our enterprise channel performed in line for our expectations for Q4 and provide a delivered an excellent quarter and had its strongest annual financial performance to date.

None: Life Sciences growth in Q4 compared to the year prior could be attributed to long time customers, increasing their spend with us and we believe suggest to rebound from the softness in the digital advertising that formula that the pharma industry has seen the last several quarters in 2023.

None: I'm sure you have questions about our strategic review discussed in our press release two weeks ago.

None: <unk> Special Committee of independent members of the board of directors supported by legal and financial advisors are continuing to actively evaluate multiple proposals for a potential sales transaction as well as developing alternative value creation opportunities.

None: Special Committee is dedicated to be a methodical in their review with the goal of maximizing shareholder value.

None: And we will communicate the board's decision at the conclusion of the review process.

Brent Davis Layton: As a reminder, our next earnings announcement is in May. Additionally, we are pleased to announce we've appointed a new member of our board of directors and the special committee. Former Xerox executive Nicole Tarocco, further strengthening our commitment to effective governance and strategic direction. Ms. Tarocco has extensive public company experience, holding key executive roles in finance, M&A, and investment management over the last 25 years, with a strategic review process ongoing, among other things. We will not be providing 2024 guidance today.

None: As a reminder, our next earnings in May.

Additionally, we are pleased to announce we've appointed a new member of our board of directors and the Special Committee.

None: Former Xerox executives Dakota, Rocco further strengthening our commitment to effective governance and strategic direction. Mr. Rocco has extensive public company experience holding key executive roles in finance M&A and investment management over the last 25 years.

None: With the strategic review process ongoing among other factors, we will not be providing 2024 guidance today.

Brent Davis Layton: That said, when we do provide guidance, we will articulate a clear and predictable path for long-term growth and profitability. In January at J.P. Morgan, I said I was focused on three key principles in my first 90 days. Operational Excellence, Profitable Growth, and Building Innovative Next-Generation Products We took an important step in driving operational excellence when we brought in a new Chief Operating Officer, Shannon Bagley. She brings 25 years of experience. Spanning a range of functions from auditor to chief administrative officer as well as leading M&A integration efforts for multi-billion dollar acquisitions, Shannon and I worked together at Centeen for over 20 years.

None: That said when we do provide guidance, we will articulate a clear and predictable path for long term growth and profitability.

None: In January of J P. Morgan I said I was focused on three key principles in my first 90 days.

None: Operational excellence.

None: Profitable growth and building innovative next generation products.

None: Now we took an important step in driving operational excellence when we brought in a new chief operating officer, Shannon Bagley cheaper.

None: She brings 25 years of experience spanning a range of functions from auditor, the chief administrative officer, as well as leading M&A integration efforts for multibillion dollar acquisitions.

None: For over 20 years, Shannon and I worked together at Centene and her first few months of share care, she and the team quickly identified opportunities for operational improvements and financial savings to make our enterprise platform more agile efficient and effective and most of all our operational acumen enables me to focus on what I do.

Brent Davis Layton: In her first few months at Sharecare, she and the team quickly identified opportunities for operational improvements and financial savings to make our enterprise platform more agile, efficient, and effective. And most of all, her operational acumen enables me to focus on what I do best, still at this great company.

None: Best scale in this great company, and we will certainly continue to add top talent to the team.

Brent Davis Layton: And we'll certainly continue to add top talent to the team. In terms of profitable growth, as I said earlier, we achieved breakeven by the end of 2023. We have no debt and a strong balance sheet.

None: In terms of profitable growth as I've said earlier, we achieved a breakeven by the end of 2023, we have no debt and a strong balance sheet.

Brent Davis Layton: As for innovating next-generation products, I believe it's worth reminding that our founder and executive chairman, Jeff Arnold, pioneered digital health, and his DNA runs deep here at Sharecare. This company has always been on the cutting edge of innovation, and that will not stop while I am CEO. You already know Sharecare for its deep customer relationships with large employers like Delta Airlines, Kohler, Koch Industries, Lenore, and H&R Block, and health plans such as CareFirst. Our focus in those areas will only continue.

None: As for innovative next generation products I believe that the sports reminding that our founder and executive Chairman, Jeff Arnold Pioneer digital health and his DNA runs deep here sure cure.

This company has always been on the cutting edge of innovation.

None: That will not stop where I am CEO.

None: You already know share care for a deep customer relationships with large employers like Delta Airlines Koehler Koch industries, Lenoir, and H&R block and health plans such as care first.

None: Our focus in those areas will only continue.

Brent Davis Layton: But given that I spent 30 years in managed care, 23 of which were at the nation's largest Medicaid and exchange company, I immediately recognized the expansion opportunities both short and long term for Sharecare's business. In addition to deepening our public-private partnership with government. We're also focused on MCOs that specialize in Medicaid, Medicare, and the exchange. And over the last several months, we've made significant progress and developed a new health navigation platform to meet the specific needs of government-sponsored health care that, quite frankly, we believe no one else is offering. The initial iteration of our enterprise-grade navigation platform was purpose-built for Medicaid, and it's a consumer-centric digital front door where members can access their benefits, providers, governmental programs, and additional information and resources. Members can easily navigate and re-enroll in their benefits using chat functionality and receive personalized prompts to engage preventive actions and close gaps in care. Our Medicaid platform also includes a dynamic, searchable provider directory that uses geolocation technology to help members find their providers and points of interest near them, such as pharmacies or shelters. Members can refine their search to find out hours of operation. Supporting Languages or whether they accept financial assistance programs like SNAP benefits.

None: But given that I spent 30 years in managed care 23 of the nation's largest Medicaid and exchange company and really recognize the expansion opportunities both short and long term per share cares business.

None: In addition into deepening our public private partnership with government.

None: We're also focused on <unk> specialized Medicaid Medicare and the exchange.

None: And over the last several months, we've made significant progress and developed a new health navigation platform to meet the specific needs of government sponsored health care, they're quite frankly, we believe no one else is offering.

None: The initial iteration of our enterprise grade navigation platform was purpose built for Medicaid.

None: As a consumer centric digital front door, where members can access their benefits providers government programs and additional information and resources.

Members can easily navigate and re enroll for their benefits using chat functionality and receive personalized prompts to engage preventive actions and close gaps in care.

None: Our Medicaid platform also includes a dynamic searchable provider directory that uses geolocation technology to help members bond their providers and point of interest near them, such as pharmacies or shelters.

None: Members can refine their search the bond out of hours of operation supporting languages or whether they accept financial assistant programs like snap benefits.

Brent Davis Layton: The platform also includes a digital wallet for secure access to their financial assistance and reward programs, so they can easily check their account balances and transaction history. And I'm pleased to share that the reception has been incredibly strong. In fact, we signed our first Medicaid contract of the year in advanced discussions with several other companies for this new platform. Additionally, over the last several months, we've made significant progress to support risk-bearing arrangements and other reinsurance and value-based care organizations. By aligning our data analytics capability with our digital therapeutics, Clinical Advocates, and Network of Professional In-Home Caregivers

None: The platform also includes a digital wallet for secure access to their financial assistance and reward programs. So they can easily check their account balances and transaction history.

None: And I am pleased to share the reception has been incredibly strong in fact, we signed our first Medicaid contract at the year and in advanced discussion with several other companies for this new platform.

None: Over the last several months, we've made significant progress to support risk bearing arrangements and other reinsurance and value based care organizations.

None: By aligning our data analytics capability with our digital therapeutics.

None: Clinical advocates and network of professional and home caregivers, we are addressing and fragmentation of care and improving patient outcomes. This.

Brent Davis Layton: We are addressing fragmentation of care and improving patient outcomes. This not only helps high-risk members have a better quality of life but also helps our partners proactively bend the health cost curve and improve STARS and quality outcomes. I am pleased that we're already in contract with some of the nation's largest health plans, including one of the largest reinsurance partners for Sharecare, to support members through our digital platform, high-risk maternity programs, and provide transitions of care services. Additionally, we are contracting with a large value-based care specialty organization focused on oncology to help improve cost, quality metrics, and diagnostic accuracy. And we're actively contracting with three risk-bearing entities to use our respite care capabilities to support the application for the CMS guide program focused on dementia.

None: This not only helps high risk members have a better quality of life, but also helps our partners proactively been be held the cost curve and improve stars and quality outcomes.

I am pleased that we're already in contract with some of the nation's largest including one of the largest reinsurance partners for sure care to support members through our digital platform high risk maternity programs and provide transitions of care services. Additionally, we are contracting with the large value based care specialty organization focused on oncology.

None: <unk>.

None: To help improve cost quality metrics and diagnostic accuracy.

We're active in our contracting with three risk bearing entities to use our respite care capabilities to support the application for the CMS Guide program focused on dementia.

Brent Davis Layton: These initial agreements demonstrate our commitment to optimizing our existing capabilities to generate revenue in new markets or sharing both the financial risk and rewards with our partners. I'd like to close out our innovative discussion today with one of the industry's most followed topics, GLP-1. By pairing these medications with our digital therapeutics, our coaches and clinical advocates, and our data analytics capabilities, we're able to effect lasting lifestyle behavioral change in a way that's more effective and affordable.

None: These initial agreements demonstrate our commitment to optimizing our existing capabilities to generate revenue in new markets or sharing both the financial risk and rewards with our partners.

None: I'd like to close out on our innovative discussion today with one of the industry's most volatile topics GOP ones.

None: By pairing these medications so our digital therapeutics, our coaches and clinical evidence in our data analytics capabilities, we're able to effect lasting lifestyle behavioral change in a way that is more effective and affordable.

Brent Davis Layton: And last Friday, I participated in a meeting with one of our longtime customers to prepare for the launch of a new holistic GLP-1 weight loss solution for their associates. Each of these examples is evidence of our ability to innovate quickly and effectively and expand the field of play by bringing long-term growth and sustainability to Sharecare's business. It's important to me that you know, and believe, that I take organic growth seriously and that I thrive on both the challenge and success of executing upon it. And with the breadth and depth of resources Sharecare has assembled over the years, we have everything we need to be successful.

None: And last Friday, I participated in a meeting with them with one of our longtime customer to prepare for the launch of our new holistic G. O P. One weight loss solution to their associates.

None: Each of these examples as evidence of our ability to innovate quickly and effectively and expand the field of play will.

None: While bringing long term growth and the sustainability of the <unk> business.

None: It's important to me that you know and beliefs that I'd take organic growth seriously and that I thrive on both the challenge the success of executing upon it and.

None: And with the breadth and depth of resources <unk> assembled over the years, we have everything we need to be successful.

Brent Davis Layton: I also want you to know that I believe deeply in Sharecare, as well as our technology, our people, and where we're headed. And I look forward to sharing more about our path ahead. Thank you for your ongoing support and confidence in this company. I'll now hand the call over to Justin.

None: Also wants you to know that I believe deeply in share care as well as our technology, our people and where we're headed.

None: And I look forward to sharing more about our path ahead.

None: Thank you for your ongoing support and confidence in this company.

None: I'll now hand, the call over to Justin Justin <unk>.

Justin L. Ferrero: Sir, Thank you, Brent, and thanks to everyone for joining us this afternoon. I'll be taking you through the financial highlights for the fourth quarter and fall year 2023. We reported fourth quarter revenue of $105.3 million and adjusted EBITDA of $3 million. Due to the disputed contracts with the client discussed earlier, there was a $14.2 million negative impact on what we had expected for Q4 revenue. This includes an approximate $6 million non-cash impairment, which also negatively impacted adjusted EBITDA.

Justin L. Ferrero: Thank you Brent.

Justin L. Ferrero: Thanks to everyone for joining this afternoon.

Justin L. Ferrero: I'll be taking you through the financial highlights for the fourth quarter and full year 2023.

Justin L. Ferrero: We reported fourth quarter revenue of $105 3 million and adjusted EBITDA of $3 million.

None: Due to the disputed contract with the client discussed earlier, there was a $14 2 million negative impact what we had expected for Q4 revenue.

This includes an approximate 6 million noncash impairment, which also negatively impacted adjusted EBITDA.

Justin L. Ferrero: For the full year, our revenues grew to $445.3 million from $442.4 million a year ago, and adjusted EBITDA grew to $16.5 million versus $5.8 million year-over-year, excluding the impact of the disputed contracts with a client. Our full-year revenue would have achieved the high end of our guidance, in the middle of our adjusted EBITDA guidance. We ended the year in a very strong financial position with $128.2 million in cash on our balance sheet and over 182 million in available cash. We also successfully executed on our goal of achieving cash flow break even by the end of the year, delivering positive cash flow of a couple hundred thousand during Q4.

None: For the full year, our revenue grew to $445 3 million from $442 4 million a year ago, and adjusted EBITDA grew to $16 5 million versus $5 8 million year over year.

None: Excluding the impact of the disputed contracts with a client and our full year revenue would have achieved the high end of our guidance in the middle of our adjusted EBITDA guidance.

None: We ended the year in a very strong financial position with $128 $2 million in cash on our balance sheet and over $182 million in available cash.

None: We also successfully executed on our goal of achieving cash flow breakeven by the end of the year delivering positive cash flow of a couple hundred thousand.

None: During Q4.

None: Relative to our primary annual operating Kpis and the enterprise and provider channels. We achieved our target of 13 million lives, which includes 700000 eligible lives associated with the dispute in contracts with a client.

Operator: Relative to our primary annual operating KPIs in the enterprise and provider channels, we achieved our target of 13 million lives, which includes 700,000 eligible lives associated with the disputed contracts with the client, and we processed 6.9 million records, significantly outpacing our estimate of 6.5 million records for the year. As discussed in the comments earlier, we are well on our way to diversifying with a reliable and profitable customer base. The future is bright for our enterprise channel, and Brent has already made a significant impact in his short tenure as CEO. To close out my comments, we are confident that our 2023 investments in new product innovation and our cost optimization and globalization efforts, enabling $30 million in annualized cost savings, position us to deliver strong, long-term, bottom-line results.

And we processed $6 9 million records significantly outpacing our estimate of $6 5 million records for the year.

None: As discussed with comments earlier, we are well on our way to diversifying with a reliable and profitable customer base.

None: The future is bright for our enterprise channel and Brent has already made a significant impact in his short tenure as CEO.

None: To close out my comments, we are confident that our 2023 investments in new product innovation, and our cost optimization and globalization efforts, enabling $30 million in annualized cost savings positions us to deliver strong long term bottom line results.

Operator: I also think it's important to note that as the special committee continues to focus on maximizing shareholder value, and as we've indicated in the past, we continue to believe that each of our business channels is worth substantially more than our market capitalization today. In addition, the strength of our balance sheet, and specifically our cash position, are significant assets to our business. As Brent said, we are grateful for your ongoing support and confidence in Sharecare. Thank you all for joining us today. We'll now open the call to your questions. Ladies and gentlemen, at this time, we'll begin that question and answer session. To join the question queue, you may press star and one, all by yourself. You may press star.

None: I also think it's important to note that as the special Committee continues to focus on maximizing shareholder value and as we've indicated in the past we continue to believe that each of our business channels are worth substantially more than our market capitalization today.

None: In addition, the strength of our balance sheet, and specifically our cash position our significant assets to our business.

None: As Brent said, we are grateful for your ongoing support and confidence in share care.

Thank you all for joining US today, we'll now open the call to your questions.

None: Ladies and gentlemen at this time, we will begin our question and answer session.

None: She joined the question you May press Star and one.

None: While yourself you May press star two.

None: Our first question today comes from David Larsen from <unk>. Please go ahead with your question.

David Michael Larsen: Our first question today comes from David Larson from BTIG. Please go ahead with your question. Hi, can you please talk a little bit more about this contract dispute? Are you able to disclose the name of the client? What is your relationship with Elevance Health? and what is the nature of the dispute?

David Michael Larsen: Can you please talk a little bit more about this this contract dispute are you able to disclose the name of the client how is your relationship with <unk> health.

And what is the nature of the dispute. Please thank you.

David Michael Larsen: Absolutely. Thank you, David, for the question. Hi David.

Absolutely. Thank you David for the question Jeff.

Jeffrey T. Arnold: Hi, David.

Justin L. Ferrero: So this particular client, you know, we have discussed in the past, and, and, you know, we've been advised not to get into contractual disputes, but it represents several hundred thousand of our lives under Sharecare Plus. And this particular contract from this client has given us challenges in the past, in which some of the commitments weren't honored, which made it difficult for us to forecast, and, working with Brent, we made the decision that, you know, certainty is important going forward and that we should focus on higher-margin business. And so we're transitioning away from that contract.

Jeffrey T. Arnold: This.

Jeffrey T. Arnold: Particular client we have discussed in the past and and you know we've been advised not to get into contractual disputes, but it represents several hundred thousand of our lives Thunder sure care plus and this particular contract from this client.

Jeffrey T. Arnold: Has given us challenges in the past and with some of the commitment.

Jeffrey T. Arnold: Werent honored which made it difficult for us to forecast and you know working with Brian made the decision that certainty is important going forward and that and that we should focus on.

Jeffrey T. Arnold: Higher margin business, and so were transitioning away from that contract.

Jeffrey T. Arnold: Okay can you maybe talk a little bit more about sort of the evolution of the data management capabilities of.

David Michael Larsen: Okay, can you maybe talk a little bit more about sort of the evolution of the data management capabilities of Sharecare and your ability to bear risk. And I guess what I'm getting at is you have like a dashboard, an executive dashboard that you can share with your health plan customer saying, "Okay, these are the number of lives. These are the number of lives that have used the solution."

Jeffrey T. Arnold: Sure care and your ability to bear risk and I guess, what I'm getting at is.

Do you have like a dashboard and executive dashboard that you can share with your health plan customers, saying, Okay. These are going or not the number of lives news of the number of lives that have used a solution. This is these are the clinical interventions that have been made this quarter. This is your claims trend on a per member per month basis. This is the improve.

Brent Davis Layton: These are the clinical interventions that have been made this quarter. This is your claims trend on a per member, per month basis. This is the improvement in trend based on those interventions. Can you talk about your ability to deliver that kind of data, which I think may have proactively prevented any kind of dispute that might have occurred with a health plan client? I imagine they want to sort of see the improved trend and value that's being delivered. Just any thoughts or calls would be very helpful, please.

Jeffrey T. Arnold: And trend based on those interventions can you talk about your ability to deliver that kind of data, which I think may have proactively prevented any kind of dispute that that might have occurred with.

Jeffrey T. Arnold: A health plan client I imagine they they want to sort of see the improved trend in value. That's being delivered just any thoughts or color. There would be very helpful. Please. Thank you very much.

Justin L. Ferrero: Thank you very much. Well, I would kind of answer that in two ways. One is that we very much have advanced analytics and an interoperable platform and are able to deliver real-time measurement of all our programs. And this particular dispute has nothing to do with that, our ability to deliver those capabilities. That's not what's under dispute.

None: Well I guess I would kind of answer that in two ways. As is one as you know we very much have advanced analytics, and interoperable platform and bill and we're able to deliver in real time.

None: Measurement of all our programs and this particular dispute.

None: Has nothing to do with that of our ability to deliver those capabilities.

None: Not what's under dispute.

None: Okay.

None: Okay. So they were showing improved claims trend good utilization.

Justin L. Ferrero: Okay, so they were showing improved claims trends, and good utilization. Unknown Speaker But there is a separate dispute that's, There's a contractual dispute that, you know, we, you know, believe, you know, needs to be resolved. And, you know, and because of that, you know, we're transitioning for now away from that relationship. But we're not disputing any of the things that you talked about.

But there is a separate dispute that's occurring.

None: There is a contractual dispute.

None: That debt.

None: Now we.

None: I believe.

None: You know.

None: <unk> needs to be resolved.

None: And you know and because of that you know were transitioning them for now.

None: Away from that relationship, but we're not disputing any of the things that you talked about.

None: Okay, and then just I guess, Brent just what are your thoughts on the business going forward like what sort of things.

Brent Davis Layton: Okay, and then just, I guess, Brent, which is what are your thoughts on the business going forward? Like what sort of things would you like to see implemented, what are the greatest capabilities of Sharecare going forward that you want to bring to manage care plans, and just thoughts on how to grow the enterprise would be very helpful. Absolutely.

None: <unk> would you like to see implemented what are the greatest capabilities of share care going forward that you want to bring T to managed care plans and just thoughts on how to grow enterprise would be very helpful. Thank you.

Brent Davis Layton: Thank you for the question, David. First of all, my enthusiasm is sky high for the company. And I really have gone from coast to coast meeting with potential customers and our current customers, and in my old role at my other company. I used to have all types of companies come to me and say, we have this solution or that solution, but nobody ever asked me what I needed and how to have such an impact. I've had the opportunity to do that now many times over.

Brent Davis Layton: Absolutely. Thank you for the question David first of all I My enthusiasm is sky high for the company.

None: And I really have gone from coast to coast meeting with potential customers in our current customers.

None: And in my old role at my other company.

None: I used to have all types of companies come to me and say, we have this solution or that solution, but nobody ever asked me, what I needed and how to have such an impact.

I've had the opportunity to do that now many times over and will not have the opportunity to talk about our platform our technology, our flexibility our ability to scale.

Brent Davis Layton: And when I've had the opportunity to talk about our platform, our technology, our flexibility, our ability to scale, and, most of all, our innovation, I am finding great receptivity, and that is both from MCOs, that is from entities that are leading the efforts in value-based care, and that is actually from employers as well. So my enthusiasm has grown.

None: And most of all our innovation I am finding great receptivity.

None: That is both from <unk> that is from entities that are leading the efforts in value based care.

None: That is actually from employers as well.

None: So my enthusiasm has grown but when I had the opportunity to come as CEO last fall when the board came to me.

Brent Davis Layton: Look, when I had the opportunity to come in as CEO last fall, when the board came to me, I believed in our technology because I had the opportunity to be on the board for several months. But now, having 90 days to be able to visit with so many customers and to be able to sit down and talk to them about what we do, what we can do, and what they're looking for, I believe the future is very bright. I'm as excited as I can be.

None: I believed in our technology, because I had the opportunity to be on the board for several months.

None: Now, having 90 days to be able to visit with so many customers and to be able to sit down and talk to them about what we do what we can do and what they're looking for.

None: I believe the future's very bright I'm as excited as I can be you know when I started with <unk>. Many many years ago, we did about 300 million in revenue and when I walked out the door, we're doing more than $130 billion in revenue and I was able to be very much a part of scaling that great company and I have every belief that I can scale. This company becomes.

Brent Davis Layton: You know, when I started with Cintin, many, many years ago, we did about $300 million in revenue. And when I walked out the door, we were doing more than $130 billion in revenue, innovative, creative technology. And we also have other assets, our life sciences. I've got to admit, life sciences was something new for me when I came to Sharecare.

None: We actually have scalable.

None: Innovative creative technology, and we also have other assets our life Sciences, I've got a Nit lifestyle, so something new for me when I came to share care.

Brent Davis Layton: And I've had the opportunity to visit with our team and our staff in New York and have had a lot of time to be able to learn about them. And I'm amazed by the data they have and what they do on a daily basis, and being able to work with Tim Husted and our team on provider and all the things that they are doing both in terms of the release of information and then, of course, you know, care link. That literally allows me to have opportunities with so many unique value-based companies. And you're gonna hear more and more about that.

None: And I've had the opportunity to.

None: Visit with our team and our staff in New York and had a lot of time to be able to learn about it and I'm amazed by the data they have and what they do on a daily basis.

None: And be able to work with Tim Houston, and our team on provider and all the things that they were doing both of them release of information and then of course, you know care links.

None: That literally allows me to have opportunity with so many unique value based companies and you're going to hear more and more about that and I gave you a little bit of flavor on my comments, but the future's very bright for share care and the one thing I'm going to do is I'll make sure that we're gonna have a diversity and a variety of clients.

Brent Davis Layton: And I gave you a little bit of my flavor of my comments, but the future is very bright for Sharecare. And the one thing I'm going to do is to make sure that we're gonna have diversity and variety of clients. My old boss used to say that we are not going to basically look to one client to be it. We're not going to look to one state for that or one customer. We're going to go out from coast to coast and have multiple clients and have multiple impacts, and that's exactly where I'm going to take Sharecare. Thanks a lot.

None: The old boss used to say that we are not going to basically look to one client to be we're not going to look to one state for that or one customer we're going to go out from coast to coast.

None: And have multiple clients and have multiple impact and that's exactly where I'm going to take share here.

None: Okay. Thanks, a lot I'll hop back in the queue.

None: Thank you.

None: Our next question comes from Richard close from Canaccord Genuity. Please go ahead with your question.

Richard Collamer Close: Yes, just to be.

Richard Collamer Close: To be clear on the nonperforming contract.

Brent Davis Layton: I'll hop back on the, Thank you. Our next question comes from Richard Close from Canaccord Genuity. Please go ahead with your, Yeah, just to be clear on the non-performing contract. Is that completely off the books?

Richard Collamer Close: Is that completely off the books.

Richard Collamer Close: At this point.

Richard Collamer Close: There'll be no additional noise going forward on that and then are there any other contracts like this that could be an issue.

Richard Collamer Close: At this point? There will be no additional noise going forward on that. And then, are there any other contracts like this that could be an issue? No, it's not. We expect definitely Q1 to have a similar impact. This is Justin.

None: No it's not.

None: What we expect.

None: Definitely for Q1 to have a similar impact this is Justin Richard Thank you for the question.

Justin L. Ferrero: Richard, thank you for the question. So there is still noise. Obviously, we're working to resolve the dispute, but until that has been fully agreed upon, then we expect to continue to see an impact on the P&L. So that. Yeah, you can expect that in Q1 as well. So this is of similar magnitude.

None: So there is there is still noise, obviously, we're working to resolve the dispute.

Justin L. Ferrero: But until that has been.

Justin L. Ferrero: Fully agreed upon then we expect to continue to.

Justin L. Ferrero: See an impact to the P&L.

Justin L. Ferrero: So that.

None: Yeah, you can expect that in Q1 as well.

Tim Houston: So this is Tim.

Tim Houston: Miller magnitude.

Tim Houston: Similar magnitude of dividend guidance, Okay, Yeah, I'm not given similar.

Justin L. Ferrero: Similar magnitude, but we're obviously hopeful that we can resolve the contract dispute, and we're actively having conversations around that, but it is a significant magnitude. And so we're working hard to resolve it, but I don't have that timetable set as we sit here today. And it'll impact us in the first half of the year. But as Brent talked about earlier, he has a lot of opportunity that he has brought in a very short time. It is 90 days, and we're going to start seeing that come online, you know, starting in Q3.

Tim Houston: Similar similar magnitude, but we're obviously hopeful that we can resolve.

Tim Houston: The contract dispute.

Tim Houston: And we're actively having conversations around that but it is a significant magnitude in and so we're working hard to resolve it.

Tim Houston: I don't have that timetable.

Tim Houston: As we sit here today.

Tim Houston: So it'll be it'll impact us in the first half of the year, but as Brent talked about earlier.

Tim Houston: He has a lot of opportunity that he has brought in a very short time.

Tim Houston: It is 90 days.

Tim Houston: And we're going to start seeing that come online starting in Q3.

Justin L. Ferrero: And so, you know, I just want to reiterate the impact that he's had in a short time and that the future is bright for enterprise. Okay, and then with respect to, I guess, the momentum in the Medicaid and Medicare exchange business, and then you're talking about a reliable, profitable, you know, customer base going forward. You know, maybe talk a little bit more about the opportunities on Medicaid. I know you signed one contract. If you can give any details on that, I guess it's going live in the third quarter.

So you know.

Tim Houston: I just want to reiterate the impact that he has had in a short time and that the future is bright for enterprise.

Tim Houston: Okay, and then with respect to I guess at the moment and in Medicaid Medicare Exchange business.

Tim Houston: And then youre talking about reliable profitable customer.

Tim Houston: Customer base going forward you know me.

Tim Houston: Talk a little bit more about that.

Tim Houston: The opportunities on Medicaid I know you signed one contract. If you can give any details on that I guess, let's go and live in third quarter.

Richard Collamer Close: But is there also going to be any deemphasizing of the employer market? Are you like pivoting, you know, towards these government markets? How do we think about that? I know there's a ton of questions. That's okay, Richard, and I'm glad to answer all of them.

Tim Houston: But they're also going to be any deemphasizing of the employer market are you pivoting towards these government markets. How do we think about that I know, there's a ton of questions in there.

None: That's okay, Richard and I'm glad to answer all of them first.

Brent Davis Layton: First and foremost, there's no backing down for my employer one bit. I've had the opportunity to be in a handful of best and finalist meetings with hopefully potential customers, and I have visited with current customers. So we're not backing down from employers at all. In fact, I'm going to try and bring more and more disciplined. At Centeen, I had the opportunity to be a part of 110 RFP wins, RFPs that sometimes were 10,000 pages and very complex. I was in finalist meetings and did all types of business development, and so forth. I did that for two decades.

Richard Collamer Close: First and foremost there's no backing up for employer, one bid I've had the opportunity to be on a handful of best and finalist.

Richard Collamer Close: Meetings with hopefully potential customers and I have visited with current customers. So we're not backing up from employers at all in fact, I am going to try and bring more and more discipline.

Richard Collamer Close: <unk> I had the opportunity to be a part of 110 RFP wins rfps that sometimes were 10000 pages and very complex I will combine those meetings and did all types of business development and so forth the debt for two decades, and I'm going to try to make sure that we have the very best RFP procurement business development approach there is.

Brent Davis Layton: And I'm going to try to make sure that we have the very best RFP procurement business development approach there is, and that's something you should hold me accountable for, and we're going to focus that on employers. We're going to focus that on government. I absolutely believe in public-private partnerships, and I believe our technology brings all types of solutions to state governments throughout this country.

Richard Collamer Close: And that's something you should hold me accountable for and we're going to focus that on employers, we're going to focus that on government.

Richard Collamer Close: I, absolutely believe in public private partnerships and I believe our technology brings all types of solution to state governments throughout this country and in regards to Medicaid.

Brent Davis Layton: And in regards to Medicaid, At the end of the day, there is a lot of opportunity within Medicaid, even though the redeterminations are out there, there's still roughly 80 plus million people in Medicaid in this country. And we've been able to develop something very unique with our navigation tool, trying to make sure, and I'll freestyle with you for a moment, Richard, so that that Medicaid recipient knows that the provider that's nearest to them, that's in network, is three miles away, that they're open four days a week, that they close at four o'clock, that the provider's actually speak Spanish, and that they will actually schedule an appointment for you immediately online, that the nearest grocery store is four miles away, and that ultimately you know that grocery store will take your SNAP benefits, for all the governmental programs and all the not-profit groups that exist out there, better known as Social Determinants of Health, that ultimately you have a dynamic directory so people can see about them, interact with them, and contact them.

The end of the day, there is a lot of opportunity within Medicaid, even though the redetermination are out there. They are still roughly 80 plus million people in Medicaid in this country and we've been able to develop something very unique with our navigation tool trying to make sure. We're now freestyle with you for a moment Richard so the debt Medicaid recipient knows that.

None: The provider that's nearest to them that their network is three miles away that they're opened four days a week that they close a four o'clock.

Providers actually speak Spanish and that they will actually schedule appointment for you immediately online that the nearest grocery stores four miles away and that ultimately you'd know that grocery store will take your snap benefits for all the governmental programs in all of the nonprofit groups that exist out there better known as social determinants of health.

None: That ultimately you have a dynamic directory. So people can see about them interactive my contacted them. That's the creativity desk. The innovation you should expect a share care.

Brent Davis Layton: That's the creativity, that's the innovation you should expect from Sharecare. I was sure looking for that back in my old job, and I'm honored to have it here today. In regards to the exchange... I think anybody who knows me by history knows I'm a huge advocate of the exchange and a huge advocate of things that are going on with the exchange. I can remember three short years ago, the overall exchange was somewhere around eight to ten million.

None: We're still looking for that back in my old job and I'm honored to have it here today in regards to the exchange.

None: Anybody who knows me by history, I'm, a huge advocate exchange and huge advocate of <unk>.

None: Things that are going on with the exchange I can remember three short years ago. This strange overall was somewhere around $8 million to $10 million today, there is $21 3 million people in the exchange and growing.

Brent Davis Layton: Today, there are 21.3 million people in the exchange and growing. Between the data that we have, the technology we have, and the innovation we have, you should expect us to be involved in that, and you also should expect us to be involved with ICHRA as that begins to take hold from a small group to a large group from that standpoint. And yes, we're talking to Medicare MCOs as well. I'm very proud that we are being creative in other lines of insurance, like re-insurance, as I mentioned. When talking to my staff, we sat down and said, look, I'm trying to bring you creative ideas. What other creative ideas do you have?

None: Between the data that we have the technology, we have and the innovation. We have you should expect us to see us involved in that and you also should see us involved with aircraft as that begins to take hold from small group to large group from that standpoint, and yes, we're talking to Medicare <unk> as well.

None: And I'm very proud that we are being creative in other lines of insurance like reinsurance as I imagined and talking to my staff, we sat down and silicon I'm trying to bring creative ideas what other creative ideas do you have and they brought the ideas of reinsurance and then value based my old job I did a tremendous amount of value based contracting.

Brent Davis Layton: And they brought the ideas of reinsurance and then value-based. In my old job, I did a tremendous amount of value-based contracting. And I can say that we have talked to some of, and we are going to work with some of, the largest value-based risk assumption companies that are out there. In a lot of ways, if we didn't have CareLinks, we wouldn't be able to do it.

None: I can say that we have talked to some of and where youre going to work with some of the largest value based risk assumption companies that are out there and a lot of ways that we didn't have care links we wouldn't be able to do it but since we do have <unk>. We can focus on post acute we can help people received the right care. They can in their home, we can stretch out that savings and more importantly, a pause.

Craig Matthew Hettenbach: But since we do have CareLinks, we can focus on post-acute care. We can help people receive the right care they can in their home. We can stretch out that savings and, more importantly, have positive outcomes. The assets that Jeff and his team have put together from life sciences to provider to enterprise platform flow quite well together in the modern healthcare system. And that's why, at the end of the day, I'm glad I'm here. I've been here for 90 days, and I look forward to watching this really company evolve and grow. Thank you. All right. And our next question comes from Craig Hettenbach from Morgan Stanley. Please go ahead with your answer.

None: Is it a outcomes the assets that Jeff and team has put together from life sciences to provide or to enterprise platform flows quite well together in a modern healthcare system and that's why at the end of the day I'm glad to hear I've been here 90 days and I look forward to Watson is really company evolving growth. Thank you.

None: Alright, thank you.

And our next question comes from Craig Hatton Bock from Morgan Stanley. Please go ahead with your question.

Brent Davis Layton: Great, thank you. Brent, maybe I could build on some of the discussion just now in terms of just the customer meetings you've had. Anything tangible as to kind of what you've identified, where you need to execute, or how you. I'd say on the employer front, clearly, as I mentioned, GOP ones have been a brilliant topic to discuss, top of mind. And before I took over as CEO, Jeff and his team were already on it. So to be able to move quickly and to be able to go live soon with a new existing customer and to have that conversation and be there for our current customers and new ones is very much a part of that. But at the same time, it's making sure that our technology is meeting the needs of employers. And that's one thing that I've enjoyed meeting in these meetings and sitting in these best and finals to make sure that we are meeting their needs and what they're looking for.

Speaker Change: Great. Thank you Brent maybe just building on some of the discussion just now in terms of just.

Speaker Change: The customer meetings, you've had and just anything tangible as to kind of what you've identified is where you need to execute or how you kind of put this in to plan. If you will.

None: I would say on the employer.

None: Clearly as I mentioned GOP ones have been Ah.

Really a topic to discuss.

None: Top of mind.

None: Before I took over as CEO, Jeff and team are already on it so to be able to move quickly and to be able to go live soon with a new existing customers and to have that conversation to be therefore, our current customers and new ones very much a part of that.

None: But at the same time is making sure that our technology is meeting the needs of employers and Thats. One thing that I've enjoyed meeting these meetings and sitting in these best in bundles and make sure that we're meeting their needs and what they're looking for and what I'm finding is that our approach to our digital front door, what I'm finding is our approach and coaching as well as advocate.

Brent Davis Layton: And what I'm finding is our approach to our digital front door, what I'm finding is our approach to coaching as well as advocacy is meeting their needs. In a lot of ways, we just have to listen to our customers and make sure we are articulating correctly what we're doing because we do have a lot of ways to solve for that. But at the same time, it's getting to know partners or future partners and making sure we meet their needs from that standpoint. In regards to MCOs, the MCOs have, you know, at the end of the day are incredible. I've been in the industry for 30 years, and I think a lot of people forget the great impact that they have. But there are certain places that companies like Sharecare can come in and bring assistance. Navigation is one.

None: Efficacy is meeting their needs and a lot of ways, we just have to listen to our customer and make sure. We are articulate correctly what were doing because we do have a lot of ways. The solution for that but at the same time as getting to know partners or future partners and making sure we meet their needs from that standpoint in regards to <unk>.

None: Like the <unk>.

None: At the end of the day, our incredible auditors in the industry for 30 years, and I think a lot of people forget the great impact that they have that they are certain places that companies like share can come in and bring assistance navigation is one being able to help people access benefits and access services.

Brent Davis Layton: Being able to help people access benefits and access services, and to be able to have an impact on proper utilization and to be able to focus on care gaps. There are all types of areas of all types of MCOs I've had discussions with. But in talking to Medicaid MCOs, whether it's navigation or, more importantly, what they want to make sure is that members get all the care they should. And I believe that our technology and our ability to get people on our platform and to receive service and care can do just that. I look forward to, you know, how we're going to be judged by MCOs down the road. Because I'm confident they're going to want to work with us in regards to our navigation tool.

None: To be able to have an impact on property utilization and to be able to focus on care gaps. There is all types of areas of all types of <unk> had discussions with but in talking to Medicaid MCR, whether it's navigation, but more importantly, what they wanted to make sure is that members get all the care they should and I believe that our two.

None: Acknowledging our ability to get people on our platform and receive service and care. We can do just that I'll look forward to how we're going to be judged by M. <unk> down the road because I'm confident they're going to want to work with us in regards to our navigation tool, but more important they are going to make sure that we have outcomes and I'll look forward to over the coming quarters to report those outcomes do you to show you that we're having a P.

Brent Davis Layton: But more important, they're going to make sure that we have outcomes, and I look forward to reporting those outcomes to you over the coming quarters to show you that we're having a positive impact on people's lives. And I know that I'm going to be held to a high bar by the MCOs and by you and by others. And I look forward to that challenge.

None: Positive impact on People's lives, and I know that I'm going to be held to a high bar by <unk> and by you and by others and I'll look forward to that challenge.

None: Got it thanks for that as a follow up I mean play a market I think before your arrival there was a big investment in terms of sales force and just building out kind of that sales infrastructure to execute.

Craig Matthew Hettenbach: As a follow-up on the employer market, I think before your arrival, there was a big investment in Salesforce, and just building out kind of that sales infrastructure to, Do you think you have the right go-to-market, or are there things you're also going to tweak there in terms of where you've invested? Grow that. Absolutely. We have the right go-to-market. In a lot of ways, it's just sales discipline at the end of the day, and focus, and how to scale.

None: You have the right go to market or are there things you're also going to tweak there in terms of where you've invested to grow that business.

None: Absolutely we have the right go to market I think a lot of ways just sales discipline.

None: At the end of the day and focus on how to scale and that's a lot of ways. It has to do about how are we responded at RFP are we listening and properly answered the question that our client wants.

Brent Davis Layton: And that has to do with how we responded to the RFP. Are we listening and properly answering the questions that our client wants? At the same time, are we finding the solutions to help them do better in the outcomes they wish for? And to be able to go in there and properly be a partner.

None: At the same time are we finding the solutions to help them do better and the outcomes they wish for and to be able to go in there and probably be a partner and a lot of that is just overall sales discipline and to be able to really be in that role for well over two decades, I have a pretty good insight to that and I'm really good at listening to customers and helping them.

Brent Davis Layton: And a lot of that is just overall sales discipline. And to be able to really be in that role for well over two decades, I have pretty good insight into that. And I'm really good at listening to customers and helping them get to where they're going. So, absolutely, we have what we need here. It's a matter of listening to our customers and acting upon it. And I think that discipline and our skills are going to get sharper and sharper. We're going to focus on it. You know, one thing at the end of the day. I like to win, and I like to have an impact.

None: Get to where they're going so absolutely we have what we need here, it's a matter of listener customers and acting upon it and I think that discipline and arts skills, we're going to get sharper and sharper.

None: We're going to focus on it one thing and then the day I'd like to win and I like to have an impact and that's where we're going to go in sales.

Brent Davis Layton: And then this last question for me, understanding you're not providing guidance, but at a high level, any kind of headwinds or tailwinds you would call out kind of by business segment this year to keep in mind? Justin, I'll let you go with that one, sir.

Got it and then just last question from me understanding you're not providing guidance, but at a high level any kind of headwind or tailwind you would call out kind of by business segment. This year to keep in mind.

None: Just and I'll, let you go without one Sir yes.

Justin L. Ferrero: Yeah. Are you referring to 2024? or 23?

None: Are you referring to.

None: 2024.

None: Our 23 ex that customer X the customer dispute just how youre thinking about the underlying trends by segment yes.

Craig Matthew Hettenbach: Yeah, and X the customer, X the customer, is how you're thinking about the underlying trends by segmentation. Well, we're, you know, I think you can see in our Q4 that we had a record year at Provider. We expect that to continue. We performed very well at Life Sciences in a down market.

None: Well we are.

None: You know I think you can see in our Q4 that we had a record year at provider.

None: We expect that to continue.

None:

<unk>.

None: We performed.

None: <unk> performed very well at life Sciences.

None: In a down market, we've talked about that a few times, Greg and so we expect that to continue so it's really the headwinds is around primarily this disputed contract and.

Justin L. Ferrero: We've talked about that a few times, Craig, and so we expect that to continue. So it's really the headwinds are around primarily this disputed contract. And, you know, I think that Brent's laid out a lot of opportunities in his first 90 days that we've started to execute against. And so, ultimately, there'll be a little bit of lag in the front end, which is what I commented on as we worked through the dispute. Hopefully, that can get done sooner than later. But I think we're going to be teed up very, very well as the other two assets are performing great. We would, as I noted in my comments, have had a really incredible quarter in Q4 if it wasn't for this disputed contract. We would have been at the high end, well over the high end of the guide. We were at the high end of the guide for the year and right in the middle of the range for EBITDA. So it's, it was all systems go, but we have this one issue, and we're working hard to resolve it.

None: I think that Brent laid out a lot of opportunity in his first 90 days that we've started to execute against and so ultimately there'll be a little bit of lag in the front end, which is what I commented on as we work through the dispute.

None: Hopefully that can get done sooner than later.

None: But I think we're going to be teed up very very well as the other two assets are performing great. We would as I noted in my comments, we would've had a.

None: Really.

None: But incredible quarter in Q4, if it wasn't for this disputed contract would have been at the high end of well over the high end of the guide.

At the high end of the guide for the year and right in the middle of the range for EBITDA. So it's it's.

None: It was all cylinder systems go but we have this this this one issue and we're working hard to resolve it. So once we get through that the future is really bright.

Craig Matthew Hettenbach: So, once we get through that, the future is really bright. Thank you, Craig. And our next question comes from Eric Percher from Nefron Research. Please go ahead with, Thank you. I think I just have two simple ones left.

None: Got it thank you.

None: Thank you Craig.

None: And our next question comes from Eric Percher from Nephron Research. Please go ahead with your question.

Eric R. Percher: Thank you I think I just have two simple ones left first congrats on getting to cash flow breakeven.

Eric R. Percher: First, congratulations on getting to cash flow breakeven. I do want to ask, is there a dependency on maintaining that on coming to an agreement with this client? Is there any?

Eric R. Percher: I do want to ask is there dependency and maintaining that on.

Eric R. Percher: Coming to agreement with this client is there any.

Justin L. Ferrero: Transcription by CastingWords, Unknown Attendee, Sharecare Unknown Attendee, Sharecare, Yeah. It will there'll be an impact. We need to resolve this, you know, in order to maintain cash flow breakeven. But there are things that we can do as a business to offset that, which we're looking at. But again, Eric, we've been focused on being cash flow positive, as we've talked about all year. It was a big push.

None: Anthem back stepping from breakeven.

None: Yes.

None: Sure.

None: Yes.

None: It will there'll be an impact.

None: We need to resolve this in order to maintain cash flow breakeven.

None: But there are things that we can do as a business.

None: To offset that.

None: We're looking at but.

None: Again, Eric we've been focused on being cash flow positive as we've talked about all year. It was a big push.

None: We are all thrilled that we achieved it.

Justin L. Ferrero: We're all thrilled that we achieved it. The Q1, as you know, is, you know, seasonally a lower quarter for us. So we expect some burn in the first half of the year.

The Q Q1, as you know as you know.

None: Seasonally it is a lower quarter for us. So we expect some burn in the first half of the year, but.

Justin L. Ferrero: But, you know, we think that will be very similar. We think that we can get back to cash flow break even as the long-term answer. So we take it, it's a challenge for us, and we achieve it. And, although there may be a short-term hit, we'll get back to it, appreciate it, and we heard you loud and clear on the cash on the back. This may be slightly related. Is it possible to size the annual impact of the disputed contract? Not asking for 25 looking back over 24 to give us.

None:

None: We think that will it'll be a very similar we think that we can get back to cash flow breakeven as the long term answer so we take it it's a challenge for us and we achieved it in and although there may be a short term hit will get back to it.

I appreciate it and we heard you loud and clear on the cash on the balance sheet.

None: Maybe.

None: Related is it possible to size the annual impact of the disputed contract.

None: Asking for 25, but looking back over 2004 and give us some measure here.

None: Well it could potentially be.

None: You know as large as rolling forward.

Eric R. Percher: Well, it could potentially be, you know, as large as rolling forward. Q4, in that in that realm. It could potentially be there.

None: Q4.

None: And that in that in that realm.

None: It could potentially be there now please know that we are again. This is part of why we Havent guide and we are working very diligently to resolve the dispute.

Justin L. Ferrero: Now, please know that we are, again, this is part of why we haven't guided you, we are working very diligently to resolve the dispute. And, and so, we're hopeful that that won't be the case. And then, on the last one, I want to take the bait on the GLP-1 commentary.

None: And.

None: And so.

None: We were hopeful that that won't be the case.

None: Okay.

None: And then the last one I wanted to take the bait on the GOP one commentary are you.

Eric R. Percher: Are you, well, I'll ask, what are you doing there? And I assume that this is relative to behavioral engagement and not in the realm of fulfillment. Do you partner for fulfillment? How are you working with payers? I'm going to let Jeff take the honor of that.

None: I'll ask what are you doing there and I assume that this is relative to behavioral engagement than not.

The realm.

None: The settlement do you partner for fulfillment how are you working with payers in that space.

Jeffrey T. Arnold: He has led the charge on that, and he's been talking ever since we got here on day one. So, Jeff, I'm going to let you take that one, sir. Sure. On the GOP1 front, you know, Eric, we've talked about it in the past. It's an exciting area, and similar to our business, we're taking a holistic approach to looking at how we can combine our unique assets to have a differentiated offering. And so, we've been working with our medical team to really understand what the right criteria is based on our claims data, and then using our analytics to be able to onboard those people based on eligibility. And yes, we've been working on different ways to source the GOP1s, whether it's from compound pharmacies or directly from manufacturers, and then how to leverage our behavior change program, our DPP-approved Eat Right Now, as well as our Unwinding Anxiety, and then lastly, how to use our WeCare Rewards platform for adherence.

None: I'm going to let Jeff take the honor him that he has led the charge on that and he's been talking ever since we got here on day, one so Jeff and we'll let you take that one sure yeah on the <unk> front, you know Eric as we've talked about in the past, it's exciting area and similar to our business. We were taken a holistic approach and looking out.

Jeffrey T. Arnold: We can combine our unique assets to have a differentiated offering and so we've been working with our medical team to really understand what's the right criteria.

Jeffrey T. Arnold: Based on our claims data and then using our analytics to be able to onboard those people based on eligibility and yes, we've been working on different ways to source.

Jeffrey T. Arnold: The G. L. P. One whether it's from compounding pharmacies or directly from manufacturers and then how to leverage our behave or behavior change program.

Jeffrey T. Arnold: Our DPP approved eat right now as well as our unwinding anxiety and then lastly, how to use our we care rewards platform for adherence and so we've kind of stitched all this together in a really elegant interoperable way and have now are now in our go to market like talking to our clients and thinking through.

Jeffrey T. Arnold: And so, we've kind of stitched all this together in a really elegant, interoperable way, and are now in our go-to-market, like talking to our clients and thinking through how to address affordability, and that's where some of the compound pharmacies have kind of come into play. But we've been doing that in partnership with the client. Thank you. Terps.

Jeffrey T. Arnold: How to address affordability, and that's where some of the compounding pharmacy pharmacies have kind of come into play, but we've been doing that in partnership with the client.

None: Interesting. Thank you.

None: Sure. Thank you.

Eric R. Percher: And our next question is a follow-up from... University. Yeah, I just wanted to follow up on the contract, the disputed contract, just on the EBITDA. I mean, you classify it as, you know, roughly a $6 million impairment. Is that just the fourth quarter?

Richard Collamer Close: And our next question is a follow up from Richard close from Canaccord Genuity. Please go ahead with your follow up.

Richard Collamer Close: Yes, I just wanted to follow up on the contract disputed contract just on the EBITDA you classify it as you know roughly a 6 million dollar impairment is that just the fourth quarter or is that a combination of maybe several quarters.

Richard Collamer Close: Or is that a combination of maybe several quarters? I know, in the answer to one of the recent questions, you said, look at the fourth quarter and roll that forward. Yeah, there are contracts that we label specific to the impairment. We took the impairment, all in the fourth quarter, which we were amortizing through contra revenue over the term of the relationship. But we went ahead and took the worst case scenario.

Richard Collamer Close: <unk>.

Richard Collamer Close: No.

Richard Collamer Close: The answer to the one of the recent questions you said look at the fourth quarter and roll that forward.

Richard Collamer Close: But just clarity on the EBITDA would be helpful.

None: Yes, there is.

None: There is on track.

None: Which we label specific to the impairment.

None: We took the impairment.

None: Sure.

None: All in the fourth quarter, which we were amortizing through onshore revenue over the term of the relationship.

None: But we went ahead and took a worst case scenario.

Justin L. Ferrero: But there could be other items of these contracts that impact EBITDA going forward. Okay. Which is why I say, you know, rolling this forward is the right way to look at it. But specific to that impairment, we impaired that asset in full. Unknown Speaker

None: But there could be other other items are these contracts that impact EBITDA going forward.

None: Yeah.

None: Okay.

Which is why I say rolling Rolling this forward as the as the right way to look at it.

None: But specific to that impairment, we impaired that asset.

Paul: And Paul.

Paul: Okay.

Richard Collamer Close: And then Brent, maybe on the Medicaid navigator platform for Medicaid. So just help me out here. Is this the customer? The state that you would be selling this to? So you sell it to the state, and they, you know, maybe require all the managed care organizations for managed Medicaid to, you know, provide this to their population? Or is it that you are essentially contracting with the managed Medicaid organization? Thank you for the question. We definitely could interact with states.

None: And then Brent maybe on the Medicaid.

None:

None: The navigation platform for Medicaid so.

None: Just help me out here is the customer the state.

None: That you would be selling this too so.

None: You sell it to the state and they maybe require all the managed care organizations for managed Medicaid.

None: Provide this to there.

None: To the population or is it you are essentially contracting with the managed Medicaid organization.

Brent Davis Layton: I mean, I did that for many, many years at Centene, but I will tell you right now that I'm focused on working with managed care organizations. The managed care organizations want to make sure that their members actually get care and get services, and they want to make sure that they understand their benefits, and I think we've developed a tool to do just that for them. But I have been speaking to a great number of states to better understand what they're looking for because I honestly believe that our technology lets us do so much more than Medicaid. There are things within justice and foster care, there are things in other social services, and, like I even mentioned SNAP before, that I think we can have an impact.

None: Thank you for the question, we definitely could interact with states I mean did that for many many years at Centene, but I will tell you that right now focused on working with <unk>.

None: <unk> want to make sure that their members actually get carried and get the services and they want to make sure that they understand their benefits and I think we've developed a tool to do that just that for them.

None: But I have been speaking to a great deal of states to better understand what they're looking for because I honestly believe that our technology lets us do so much more than Medicaid theres things with at Justice and Foster care, there's things in other social services and like David mentioned snap before that I think we can have an impact.

None: Packed so coming out of working in public private partnerships for two decades, that's something I'm going to spend a lot of time on and have a lot of conversations with states and make sure. They understand the flexible and really our innovative technology, but no right now definitely focus Medicaid Mcs.

Brent Davis Layton: So coming out of working in public-private partnerships for two decades, that's something I'm going to spend a lot of time on and have a lot of conversations with states and make sure they understand the flexible and really innovative technology, but no, definitely focus on Medicaid MCOs right now. And with that, we'll be concluding today's question and answer session. I'd like to turn the floor back over to Brent Layton for closing.

Okay. Thank you.

None: And with that we will be concluding today's question and answer session I would like to turn the floor back over to Brent Layton for closing remarks.

Brent Davis Layton: Thank you, Jamie. And thank you for your questions today. I appreciate them, and I appreciate everybody spending time with me today. As I mentioned, for two decades, I was at Centeam. I started with a company with about $300 million in revenue. And today, when I walked out of that door in 2023, they were doing well over $130 billion. It was a hell of a ride, and I'm proud of my time at that great company. At Sharecare, though, I am confident we have a similar opportunity to scale this company like it did at Mojo. And from what I've seen and what I've heard and the interactions I've had as a board member and now as CEO for the last 90 days, we do have happy clients.

Brent Davis Layton: Thank you Jamie.

Brent Davis Layton: And thank you for your questions today I appreciate them and I appreciate everybody spending time with me today as I mentioned for two decades, while I was at Centene was started with the company.

Brent Davis Layton: With about 300 million in revenue and today when I walked out the door in 2023, they were doing with over 130 billion. It was a hell of a ride and I'm proud of my time with that Great company.

At share care, though I am confident we have a similar opportunity to scale. This company like I did an moe job.

None: And what I've seen and what I've heard and the interactions I've had as a board member and now as CEO over the last 90 days, we do have happy clients. We do have a dynamic innovative technology platform that creates endless opportunities, whether which states whether William Ceos.

Brent Davis Layton: We do have a dynamic, innovative technology platform that creates endless opportunities, whether with states, whether with MCOs, whether with value-based care, or employers, to help us develop new customers and new innovations. In closing, I believe in this great company, and I'm confident we can scale and that I can scale this great company by driving strong profitable growth. Thank you very much for your attention today. Ladies and gentlemen, with that, we'll conclude today's conference call and presentation. You may now disconnect your

None: Whether we value base, whether employers to help us develop new customers and new innovations in.

None: In closing I believe in this great company.

None: I am confident we can scale and that I can scale of this great company by driving strong profitable growth. Thank you very much for your attention today.

Ladies and gentlemen, with that we'll conclude today's conference call and presentation. We thank you for joining you may now disconnect your lines.