UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
(Mark One)
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QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the quarterly period ended
or
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the transition period from to .
Commission File Number:
(Exact name of registrant as specified in its charter)
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(State or other jurisdiction of incorporation or organization) |
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(I.R.S. Employer Identification No.) |
(Address of principal executive offices and zip code)
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(Registrant’s telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act:
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Trading Symbol(s) |
Name of each exchange on which registered |
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Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act:
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Large accelerated filer |
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Non-accelerated filer |
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Smaller reporting company |
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Emerging growth company |
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If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes
As of August 1, 2022, there were approximately
Benefitfocus, Inc.
Form 10-Q
For the Quarterly Period Ended June 30, 2022
TABLE OF CONTENTS
2
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
Benefitfocus, Inc.
Unaudited Consolidated Balance Sheets
(in thousands, except share and per share data)
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As of June 30, 2022 |
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As of December 31, 2021 |
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Assets |
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Current assets: |
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Cash and cash equivalents |
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$ |
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$ |
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Marketable securities |
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Accounts receivable, net |
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Contract assets |
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Prepaid and other current assets |
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Total current assets |
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Property and equipment, net |
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Financing lease right-of-use assets |
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Operating lease right-of-use assets |
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Intangible assets, net |
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Goodwill |
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Deferred contract costs and other non-current assets |
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Total assets |
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$ |
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$ |
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Liabilities, redeemable preferred stock and stockholders' deficit |
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Current liabilities: |
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Accounts payable |
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$ |
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$ |
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Accrued expenses |
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Accrued compensation and benefits |
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Deferred revenue, current portion |
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Lease liabilities and financing obligations, current portion |
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Contingent consideration |
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Total current liabilities |
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Deferred revenue, net of current portion |
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Convertible senior notes |
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Lease liabilities and financing obligations, net current portion |
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Other non-current liabilities |
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Total liabilities |
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Commitments and contingencies |
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Redeemable preferred stock: |
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Series A preferred stock, par value $ authorized, at June 30, 2022 and December 31, 2021, respectively, liquidation preference $ |
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Stockholders' deficit: |
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Common stock, par value $ |
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Additional paid-in capital |
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Accumulated deficit |
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Total stockholders' deficit |
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Total liabilities, redeemable preferred stock and stockholders' deficit |
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$ |
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$ |
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The accompanying notes are an integral part of the Unaudited Consolidated Financial Statements.
3
Benefitfocus, Inc.
Unaudited Consolidated Statements of Operations and Comprehensive Loss
(in thousands, except share and per share data)
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Three Months Ended June 30, |
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Six Months Ended June 30, |
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2022 |
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2021 |
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2022 |
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2021 |
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Revenue |
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$ |
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$ |
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$ |
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$ |
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Cost of revenue |
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Gross profit |
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Operating expenses: |
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Sales and marketing |
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Research and development |
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General and administrative |
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Impairment of lease right-of-use assets |
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Change in fair value of contingently returnable consideration |
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Restructuring costs |
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Total operating expenses |
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Loss from operations |
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Other income (expense): |
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Interest income |
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Interest expense |
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Other income |
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Total other expense, net |
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Loss before income taxes |
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Income tax expense |
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Net loss |
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Preferred dividends |
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Net loss available to common stockholders |
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$ |
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$ |
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$ |
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$ |
( |
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Comprehensive loss |
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$ |
( |
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$ |
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$ |
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$ |
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Net loss per common share: |
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Basic and diluted |
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$ |
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$ |
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$ |
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$ |
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Weighted-average common shares outstanding: |
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Basic and diluted |
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The accompanying notes are an integral part of the Unaudited Consolidated Financial Statements.
4
Benefitfocus, Inc.
Unaudited Consolidated Statements of Changes in Stockholders’ Deficit
(in thousands, except share and per share data)
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Common Stock, |
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Additional |
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Total |
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$0.001 Par Value |
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Paid-in |
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Accumulated |
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Stockholders' |
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Shares |
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Par Value |
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Capital |
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Deficit |
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Deficit |
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Balance, December 31, 2021 |
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$ |
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$ |
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$ |
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$ |
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Cumulative effect adjustment from adoption of new accounting standard |
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Issuance of common stock upon vesting of restricted stock units |
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Stock-based compensation expense |
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Preferred dividends |
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Net loss |
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( |
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Balance, March 31, 2022 |
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$ |
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$ |
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$ |
( |
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$ |
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Issuance of common stock upon vesting of restricted stock units |
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Stock-based compensation expense |
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Preferred dividends |
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( |
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Net loss |
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( |
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Balance, June 30, 2022 |
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$ |
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$ |
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$ |
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$ |
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Common Stock, |
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Additional |
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Total |
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$0.001 Par Value |
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Paid-in |
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Accumulated |
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Stockholders' |
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Shares |
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Par Value |
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Capital |
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Deficit |
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Deficit |
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Balance, December 31, 2020 |
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$ |
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$ |
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$ |
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$ |
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Exercise of stock options |
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Issuance of common stock upon vesting of restricted stock units |
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Stock-based compensation expense |
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Preferred dividends |
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( |
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( |
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Net loss |
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( |
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( |
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Balance, March 31, 2021 |
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$ |
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$ |
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$ |
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$ |
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Exercise of stock options |
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Issuance of common stock upon vesting of restricted stock units |
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Issuance of common stock under Employee Stock Purchase Plan, or ESPP |
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Stock-based compensation expense |
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Preferred dividends |
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( |
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( |
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Net loss |
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( |
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( |
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Balance, June 30, 2021 |
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$ |
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$ |
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$ |
( |
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$ |
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The accompanying notes are an integral part of the Unaudited Consolidated Financial Statements.
5
Benefitfocus, Inc.
Unaudited Consolidated Statements of Cash Flows
(in thousands)
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Six Months Ended June 30, |
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2022 |
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2021 |
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Cash flows from operating activities |
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Net loss |
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$ |
( |
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$ |
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Adjustments to reconcile net loss to net cash (used in) provided by operating activities: |
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Depreciation and amortization |
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Stock-based compensation expense |
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Accretion of interest on convertible senior notes |
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Interest accrual on finance lease liabilities |
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Rent expense less than payments |
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Change in fair value of contingently returnable assets |
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Non-cash accretion income from investments |
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Impairment or loss on disposal of right-of-use assets and property and equipment |
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Changes in operating assets and liabilities: |
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Accounts receivable, net |
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( |
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Accrued interest on investments |
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( |
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Contract, prepaid and other current assets |
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Deferred costs and other non-current assets |
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Accounts payable and accrued expenses |
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( |
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Accrued compensation and benefits |
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( |
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( |
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Deferred revenue |
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Other non-current liabilities |
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Net cash (used in) provided by operating activities |
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( |
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Cash flows from investing activities |
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Purchases of investments held-to-maturity |
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Proceeds from short-term investments held-to-maturity |
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Maturities of investments available-for-sale |
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Sales of investments available-for-sale |
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Business combination, net of cash acquired |
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( |
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Purchases of property and equipment |
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( |
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( |
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Net cash provided by (used in) investing activities |
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Cash flows from financing activities |
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Payments of preferred dividends |
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( |
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( |
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Payments of contingent consideration |
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( |
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Proceeds from exercises of stock options and ESPP |
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Payments on financing obligations |
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( |
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( |
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Payments of principal on finance lease liabilities |
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( |
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( |
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Net cash used in financing activities |
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( |
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Net increase in cash and cash equivalents |
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Cash and cash equivalents, beginning of period |
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Cash and cash equivalents, end of period |
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$ |
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$ |
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Supplemental disclosure of non-cash investing and financing activities |
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Property and equipment purchases in accounts payable and accrued expenses |
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$ |
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$ |
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