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Press Release

Castlight Health Announces Fourth Quarter and Full Year 2017 Results

Castlight Health
Posted on: 24 Feb 18

SAN FRANCISCO, Feb. 21, 2018 /PRNewswire/ -- Castlight Health, Inc. (NYSE: CSLT), a leading health benefits platform provider, today announced results for its fourth quarter and full year ended December 31, 2017.

"2017 was a transformative year for Castlight. We expanded our capabilities into wellbeing, re-accelerated growth of annualized recurring revenues compared to 2016, and positioned the business to reach breakeven in the fourth quarter of this year," said John Doyle, chief executive officer of Castlight Health. "As we look ahead, we believe Castlight is in a great position to address the critical needs of employers and employees as individuals play an increasingly central role in the health care system."

Financial performance for the three months ended December 31, 2017 compared to the three months ended December 31, 2016 includes:

GAAP total revenue of $37.0 million, representing an increase of 24%

GAAP gross margin of 63.7%, compared to 71.9%

Non-GAAP gross margin of 67.7% compared to 74.8%

GAAP operating loss of $8.9 million, compared to a loss of $9.2 million

Non-GAAP operating loss of $5.8 million, compared to a loss of $1.5 million

GAAP net loss per basic and diluted share of $0.06, compared to a net loss per basic and diluted share of $0.09

Non-GAAP net loss per basic and diluted share of $0.04, compared to a net loss per basic and diluted share of $0.01

Cash used in operations of $0.1 million, compared to $1.7 million used in operations

Financial performance for the twelve months ended December 31, 2017 compared to the twelve months ended December 31, 2016 includes:

GAAP total revenue of $131.4 million, representing an increase of 29%

GAAP gross margin of 64.1%, compared to 66.0%

Non-GAAP gross margin of 68.6% compared to 69.5%

GAAP operating loss of $61.4 million, compared to a loss of $59.0 million

Non-GAAP operating loss of $27.7 million, compared to a loss of $30.6 million

GAAP net loss per basic and diluted share of $0.44, compared to a net loss per basic and diluted share of $0.58

Non-GAAP net loss per basic and diluted share of $0.22, compared to a net loss per basic and diluted share of $0.30

Cash used in operations of $23.5 million, compared to $37.0 million used in operations

Total cash, cash equivalents and marketable securities was $93.3 million as of December 31, 2017.

The financial performance of Jiff, Inc., which Castlight acquired on April 3, 2017, is not included in the metrics for fiscal year and fourth quarter ended December 31, 2016. A reconciliation of GAAP to non-GAAP results has been provided in this press release in the accompanying tables. An explanation of these measures is also included below under the heading "Non-GAAP Financial Measures."

Castlight adopted the new accounting standard ASC 606, effective January 1, 2018, and will use the full retrospective method of adoption. As such, Castlight will restate its historical financial information for fiscal years 2016 and 2017, as well as quarterly 2017. The Company expects to provide these restatements next quarter. Based on our preliminary review of ASC 606's impact, the Company currently expects to see a reduction of 2018 revenue by approximately $2 million compared to what it would have expected under the former ASC 605 standard.

Business Outlook

The Company's outlook is based on the new revenue recognition standard ASC 606. For the full year 2018, the Company expects:

GAAP revenue in the range of $150 million to $155 million

Non-GAAP operating loss in the range of $15 million to $20 million

Non-GAAP net loss per share of approximately $0.11 to $0.15 based on approximately 137 million to 138 million shares

Quarterly Conference Call

Castlight Health senior management will host a conference call to discuss its fourth quarter 2017 results and business outlook today at 2:00 p.m. Pacific Time (5:00 p.m. Eastern Time). A live audio webcast of the conference call, together with detailed financial information, can be accessed through the company's Investor Relations website at http://ir.castlighthealth.com. An archive of the webcast can also be accessed through the same link. The live conference call can be accessed by dialing (866) 393-4306 and the replay will be available for one week at (855) 859-2056.  The conference ID number for the live call and replay is 5381456.

About Castlight Health

Castlight is on a mission to make it as easy as humanly possible to navigate healthcare and live happier, healthier, more productive lives. Our health navigation platform connects with hundreds of health vendors, benefits resources, and plan designs, giving rise to the world's first comprehensive app for all health needs. We guide individuals - based on their unique profile - to the best resources available to them, whether they are healthy, chronically ill, or actively seeking medical care. In doing so, we help companies regain control over rising healthcare costs and get more value from their benefits investments. Castlight revolutionized the healthcare sector with the introduction of data-driven price transparency tools in 2008 and the first consumer-grade wellbeing platform in 2012. Today, Castlight serves as the health navigation platform for millions of people and is a trusted partner to many of the largest employers in the world.

For more information visit www.castlighthealth.com. Follow us on Twitter and LinkedIn and Like us on Facebook.

Non-GAAP Financial Measures

To supplement Castlight Health's financial statements presented in accordance with generally accepted accounting principles (GAAP), we also use and provide investors and others with non-GAAP measures of certain components of financial performance, including non-GAAP gross profit and margin, non-GAAP operating expense, non-GAAP operating loss, non-GAAP other income, net, non-GAAP net loss and non-GAAP net loss per share. Non-GAAP gross profit and margin, non-GAAP operating expense, non-GAAP operating loss, non-GAAP other income, net and non-GAAP net loss exclude stock-based compensation, litigation settlement, charges related to a reduction in workforce, amortization of intangibles, capitalization and amortization of internal-use software, gain on the sale of investment in related party, expense related to expiration of SAP warrant, changes in fair value of contingent consideration and charges related to the acquisition and the associated tax impact of these items, where applicable.

We believe that these non-GAAP financial measures provide useful supplemental information to investors and others, facilitate the analysis of the company's core operating results and comparison of operating results across reporting periods, and can help enhance overall understanding of the company's historical financial performance.

We have provided a reconciliation of each non-GAAP financial measure to the most directly comparable GAAP financial measure, except that we have not reconciled our non-GAAP operating loss and net loss per share guidance for the full year 2018 to comparable GAAP operating loss and net loss per share guidance because we do not provide guidance for stock-based compensation expense and capitalization and amortization of internal-use software, which are reconciling items between GAAP and non-GAAP operating loss. The factors that may impact our future stock-based compensation expense and capitalization and amortization of internal-use software are out of our control and/or cannot be reasonably predicted, and therefore we are unable to provide such guidance without unreasonable effort. Factors include our market capitalization and related volatility of our stock price and our inability to project the cost or scope of internally produced software.

These non-GAAP financial measures should be considered in addition to, not as a substitute for or in isolation from, measures prepared in accordance with GAAP.

Further, these non-GAAP measures may differ from the non-GAAP information used by other companies, including peer companies, and therefore comparability may be limited. Castlight Health encourages investors and others to review the company's financial information in its entirety and not rely on a single financial measure.

Safe Harbor For Forward-Looking Statements

This press release contains forward-looking statements about Castlight Health's expectations, plans, intentions, and strategies, including, but not limited to, statements regarding Castlight Health's 2018 full year projections, our expectations for our future business and financial performance. Statements including words such as "anticipate," "believe," "estimate," "will," "continue," "expect," or "future," and statements in the future tense are forward-looking statements. These forward-looking statements involve risks and uncertainties, as well as assumptions, which, if they do not fully materialize or prove incorrect, could cause our results to differ materially from those expressed or implied by such forward-looking statements. The risks and uncertainties include those described in Castlight Health's documents filed with or furnished to the Securities and Exchange Commission. All forward-looking statements in this press release are based on information available to Castlight Health as of the date hereof. Castlight Health assumes no obligation to update these forward-looking statements.

Copyright 2018 Castlight Health, Inc. Castlight Health® is the registered trademark of Castlight Health, Inc. Other company and product names may be trademarks of the respective companies with which they are associated.

Editor's Details

Mike Wood
PharmiWeb.com
www.pharmiweb.com
editor@pharmiweb.com

Last updated on: 24/02/2018

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