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What changed in American Well Corp's 10-K — 2023 vs 2024

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Paragraph-level year-over-year comparison of American Well Corp's 2023 and 2024 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2024 report.

+339 added−369 removedSource: 10-K (2025-02-12) vs 10-K (2024-02-15)

Top changes in American Well Corp's 2024 10-K

339 paragraphs added · 369 removed · 299 edited across 7 sections

Item 1. Business

Business — how the company describes what it does

113 edited+13 added−18 removed163 unchanged
Biggest changeCelebrating diverse perspectives and backgrounds • Elevating inclusiveness and diversity at Amwell • Educating and dedicating ourselves to understanding what DEI&B means to our employees and our business • Business Sustainability – Environment, Social, Governance & Ethical Accountability • Creating a profitable growth business that contributes to a more prosperous, sustainable and healthy world • Holding ourselves accountable for measuring and managing our performance across ESG issues • Social Responsibility – Volunteering, Community involvement, Giving back, Serving our network • Giving back to our community • Leveraging our position in the market to support/help those in need • Fostering a sense of purpose and connection to our mission • Health Equity – Equal access to care, Addressing Social Determinants of Health, enabling clients and informing ourselves on how health disparities and SDOH impact our clients and health outcomes • Leveraging cross-functional data to enhance culturally intelligent application of Amwell solutions • Enable our ecosystem to improve access to equitable care 20 Diversity, Equity and Inclusion Our culture is built on diverse perspectives, which help us think differently and better equip our clients, providers and patients with the tools to realize an improved healthcare experience for all.
Biggest changeMVP Framework • Elevating inclusiveness at Amwell • Business Sustainability – Environment, Social, Governance & Ethical Accountability • Creating a profitable growth business that contributes to a more prosperous, sustainable and healthy world • Holding ourselves accountable for measuring and managing our performance across ESG issues • Social Responsibility – Volunteering, Community involvement, Giving back, Serving our network • Giving back to our community • Leveraging our position in the market to support/help those in need • Fostering a sense of purpose and connection to our mission • Health Equity – Equal access to care, Addressing Social Determinants of Health, enabling clients and informing ourselves on how health disparities and SDOH impact our clients and health outcomes • Leveraging cross-functional data to enhance culturally intelligent application of Amwell solutions • Enable our ecosystem to improve access to equitable care Investing in our Communities Amwell Cares is our Corporate Social Responsibility Initiative.
Our proprietary Carepoint devices coupled with our Carepoint Calling technology enables providers to deliver digital care into clinical care locations, such as the emergency department, community hospitals, clinics, and hospital-at-home, as well as into community settings such as retail stores, employer sites, skilled nursing facilities, correctional facilities, and schools.
Our proprietary Carepoint devices coupled with our Carepoint Calling technology enables providers to deliver digital care into clinical locations, such as the emergency department, community hospitals, clinics, and hospital-at-home as well as into community settings such as retail stores, employer sites, skilled nursing facilities, correctional facilities, and schools.
Our international operations are and will be subject to different, and sometimes more stringent, legal and regulatory requirements, which vary widely by jurisdiction, including anti-corruption laws; economic sanctions laws; various privacy, insurance, tax, tariff and trade laws and regulations; corporate governance, privacy, data protection (including the EU General Data Protection Regulation ("GDPR") and the UK General Data Protection Regulation ("UK GDPR")), data mining, data transfer, labor and employment, intellectual property, consumer protection and investment laws and regulations; discriminatory licensing procedures; required localization of records and funds; and limitations on dividends and repatriation of capital.
International Regulation Our international operations are and will be subject to different, and sometimes more stringent, legal and regulatory requirements, which vary widely by jurisdiction, including anti-corruption laws; economic sanctions laws; various privacy, insurance, tax, tariff and trade laws and regulations; corporate governance, privacy, data protection (including the EU General Data Protection Regulation ("GDPR") and the UK General Data Protection Regulation ("UK GDPR")), data mining, data transfer, labor and employment, intellectual property, consumer protection and investment laws and regulations; discriminatory licensing procedures; required localization of records and funds; and limitations on dividends and repatriation of capital.
The UK has 16 adopted the UK GDPR and Data Protection Act. The GDPR and UK data protection law may increasingly diverge from each other, thereby increasing both our compliance costs and the potential for noncompliance. Our European clinical operations team and our health care clients in Europe are regulated as data controllers under GDPR.
The UK has adopted the UK GDPR and Data Protection Act. The GDPR and UK data protection law may increasingly diverge from each other, thereby increasing both our compliance costs and the potential for noncompliance. 16 Our European clinical operations team and our health care clients in Europe are regulated as data controllers under GDPR.
Total Rewards Framework • Compensation o Base Salary o Short-Term Incentives o Long-Term Incentives o Employee Stock Purchase Program • Benefits o Healthcare o Retirement/Pension o Life, Disability, and Income Protection o Voluntary Benefits o Mental Wellbeing Support • Work-Life o Virtual First Work Environment o Paid Time Off 19 o Leave Programs o EAP Program • Rewards and Recognition o Recognition Program o Performance Feedback o Annual Merit and Bonus Program o Service Anniversaries • Development o Tuition Assistance o Training Opportunities o Leadership Development Engagement We value and solicit employee feedback and listen to all of our employees through various outlets, including all hands meetings and yearly engagement surveys.
Total Rewards Framework • Compensation o Base Salary o Short-Term Incentives o Long-Term Incentives o Employee Stock Purchase Program • Benefits o Healthcare o Retirement/Pension o Life, Disability, and Income Protection o Voluntary Benefits o Mental Wellbeing Support • Work-Life o Virtual First Work Environment o Paid Time Off o Leave Programs o EAP Program 19 • Rewards and Recognition o Recognition Program o Performance Feedback o Annual Merit and Bonus Program o Service Anniversaries • Development o Tuition Assistance o Training Opportunities o Leadership Development Engagement We value and solicit employee feedback and listen to all of our employees through various outlets, including all hands meetings and yearly engagement surveys.
We also have a full, evidence-grade digital forensics system that provides real-time 9 analysis using multiple cloud forensic tools to our cybersecurity team. Amwell adheres to what we believe to be the highest security standards in the industry, using Auth0 with OAuth 2.0 SSO webRTC for in-browser video and Google’s Healthcare API for secure and standardized data storage.
We also have a full, evidence-grade digital forensics system that provides real-time analysis using multiple cloud forensic tools to our cybersecurity team. Amwell adheres to what we believe to be the highest security standards in the industry, using Auth0 with OAuth 2.0 SSO webRTC for in-browser video and Google’s Healthcare API for secure and standardized data storage.
We make available free of charge at the Investors section of this website our Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K and amendments to those reports filed or furnished pursuant to Sections 13(a) and 15(d) of the Securities Exchange Act of 1934, as amended, as soon as reasonably practicable after we file or furnish such materials with the Securities and Exchange Commission, or SEC.
We make available free of charge at the Investors section of this website our Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K and amendments to those reports filed or furnished pursuant to Sections 13(a) and 15(d) of the Securities Exchange Act of 1934, as amended, as soon as reasonably practicable after we file or furnish such materials with the Securities and Exchange Commission, or 21 SEC.
Driven by employees, with executive oversight, Amwell Cares works to support various causes, including health equity, hunger relief, and natural disaster recovery, through a variety of activities, including but not limited to company matches, sponsorship of and participation in charity walks/runs, donations and volunteer opportunities, and pro bono healthcare services delivered to communities affected by hurricane, fire or flood.
Driven by employees, with executive oversight, Amwell Cares works to support various causes, including health equity, hunger relief, and natural disaster recovery, through a variety of activities, including but not limited 20 to company matches, sponsorship of and participation in charity walks/runs, donations and volunteer opportunities, and pro bono healthcare services delivered to communities affected by hurricane, fire or flood.
Yet, this patient can also be escalated to a synchronous session with a care provider via video using algorithms our clients configure and/or patient choice. The mix of automated, 5 digital, and virtual care capabilities Amwell offers is unique and enables our clients to operate more efficiently and effectively while adhering to their own clinical pathways.
Yet, this patient can also be escalated to a synchronous session with a care provider via video using algorithms our clients configure and/or patient choice. The mix of automated, digital, and virtual care capabilities Amwell offers is unique and enables our clients to operate more efficiently and effectively while adhering to their own clinical pathways.
Practices can be organized by clinical specialty (e.g., primary care, therapy, psychiatry, nutrition), by disease state (e.g., diabetes, asthma, hypertension) or by program type (e.g., smoking cessation, weight loss, wellness). Each practice typically represents a distinct clinical use case with its own associated client branding, patient workflows, associated providers, eligibility and pricing.
Practices can be organized by clinical specialty (e.g., primary care, therapy, nutrition), by disease state (e.g., diabetes, asthma, hypertension) or by program type (e.g., smoking cessation, weight loss, wellness). Each practice typically represents a distinct clinical use case with its own associated client branding, patient workflows, associated providers, eligibility and pricing.
Moreover, a person who offers or transfers to a Medicare or Medicaid beneficiary any remuneration, including waivers of copayments and deductible amounts (or any part thereof), that the person knows or should know is likely to influence the beneficiary’s selection of a particular provider, practitioner or supplier of Medicare or Medicaid payable items or services may be liable for civil monetary penalties.
Moreover, a person who offers or transfers to a Medicare or Medicaid beneficiary any remuneration, including waivers of copayments and deductible amounts (or any part thereof), that the person knows or should know is likely to influence the beneficiary’s selection of a particular 14 provider, practitioner or supplier of Medicare or Medicaid payable items or services may be liable for civil monetary penalties.
For health systems, most require clinical support for their initial programs and then transition to weekend or evening coverage as their clinicians are provisioned. For rural health systems or community hospitals, AMG's clinical services provide wraparound care or access to critical services like telestroke or psychiatry when they may not have any providers to meet these patients' needs.
For health systems, most require clinical support for their initial programs and then transition to weekend or evening coverage as their clinicians are provisioned. For rural health systems or community hospitals, AMG's clinical services provide wraparound care or access to critical services like telestroke when they may not have any providers to meet these patients' needs.
Risk Factors), including in the states where we predominantly conduct our business, we provide administrative and management services to entities associated with AMG (which are consolidated subsidiaries from a financial reporting perspective) pursuant to which those entities reserve exclusive control and responsibility for all aspects of the practice of medicine and the delivery of medical 11 services.
Risk Factors), including in the states where we predominantly conduct our business, we provide administrative and management services to entities associated with AMG (which are consolidated subsidiaries from a financial reporting perspective) pursuant to which those entities reserve exclusive control and responsibility for all aspects of the practice of medicine and the delivery of medical services.
These practices enable clients to attract patients and members and drive revenue with services they offer. Visits For urgent care and walk-in clinic type use cases, patients can seek care on-demand whenever coverage is available (currently 50 states and D.C., 24/7 for urgent care via AMG providers).
These practices enable clients to attract patients and members and drive revenue with services they offer. 8 Visits For urgent care and walk-in clinic type use cases, patients can seek care on-demand whenever coverage is available (currently 50 states and D.C., 24/7 for urgent care via AMG providers).
As digital care delivery continues to evolve, Amwell clients and partners have the flexibility and agility to scale virtual care 10x, or 1,000x, as needed. Interoperability Converge is built on FHIR (“Fast Healthcare Interoperability Resources”) – not an antiquated, proprietary data model that needs to be translated to HL7 standards.
As digital care delivery continues to evolve, Amwell clients and partners have the flexibility and agility to scale virtual care 10x, or 1,000x, as needed. Interoperability The Amwell Converge ™ platform is built on FHIR (“Fast Healthcare Interoperability Resources”) – not an antiquated, proprietary data model that needs to be translated to HL7 standards.
Digital Care Provider Licensing, Medical Practice, Certification and Related Laws and Guidelines The practice of medicine is subject to various federal, state and local certification and licensing laws, regulations, approvals and standards, relating to, among other things, the adequacy of medical care, the practice of medicine (including 12 the provision of remote care), equipment, personnel, operating policies and procedures and the prerequisites for the prescription of medication and ordering of tests.
Digital Care Provider Licensing, Medical Practice, Certification and Related Laws and Guidelines The practice of medicine is subject to various federal, state and local certification and licensing laws, regulations, approvals and standards, relating to, among other things, the adequacy of medical care, the practice of medicine (including the provision of remote care), equipment, personnel, operating policies and procedures and the prerequisites for the prescription of medication and ordering of tests.
The FTC and state attorneys general have brought enforcement actions and prosecuted some data breach cases as unfair and/or deceptive acts or practices under the FTC Act and similar state laws. In recent years, there have been a number of well publicized data breaches involving the improper use and disclosure of PII and PHI.
The FTC and state attorneys general have brought enforcement actions and prosecuted some data breach cases as unfair and/or deceptive acts or practices under the FTC Act and similar state laws. 15 In recent years, there have been a number of well publicized data breaches involving the improper use and disclosure of PII and PHI.
All data within the platform works with healthcare organizations’ systems and any EHR. Being FHIR-native allows the platform to be interoperable with the entire healthcare ecosystem and creates an open platform for third-party developers. App Framework We have opened Converge to others to build on and expand its abilities.
All data within the platform works with healthcare organizations’ systems and any EHR. Being FHIR-native allows the platform to be interoperable with the entire healthcare ecosystem and creates an open platform for third-party developers. App Framework We have opened the Amwell Converge ™ platform to others to build on and expand its abilities.
We also integrate with back-end systems to streamline administrative functions such as enrollment, clinical management, payment, claims administration, e-prescribing, follow-up and data 6 interchanges such as picture archiving and communication systems (“PACS”). For our clients, this functionality eases administrative burdens and supports physician workflows.
We also integrate with back-end systems to streamline administrative functions such as enrollment, clinical management, payment, claims administration, e-prescribing, follow-up and data interchanges such as picture archiving and communication systems (“PACS”). For our clients, this functionality eases administrative burdens and supports physician workflows.
The TAM in the U.S. for Converge, our hybrid care platform, is the value of the above sub-segments of the market that can be captured through technology. We believe the TAM of our hybrid care platform is approximately $31 billion and will grow to roughly $50 billion over the next four years.
The TAM in the U.S. for the Amwell Converge platform is the value of the above sub-segments of the market that can be captured through technology. We believe the TAM of our hybrid care platform is approximately $31 billion and will grow to roughly $50 billion over the next four years.
This includes: • Virtual Care — virtual urgent care, virtual office visits, virtual home health, and tele-behavioral health; • Clinical Services — patient and member engagement, specialty carveout management services, provider enablement, health and wellness administration, and patient advocacy; 4 • Software and Platforms — telehealth technology, population health, health information exchange and interoperability products, patient engagement, remote patient monitoring, and clinical decision support.
This includes: • Virtual Care — virtual urgent care, virtual office visits, virtual home health, and tele-behavioral health; • Clinical Services — patient and member engagement, specialty carveout management services, provider enablement, health and wellness administration, and patient advocacy; • Software and Platforms — telehealth technology, population health, health information exchange and interoperability products, patient engagement, remote patient monitoring, and clinical decision support.
The application of some of these laws to digital care is unclear and subject to differing interpretation. Clinicians who provide professional medical services to a patient via digital care must, in most instances, hold a valid license to practice medicine in the state in which the patient is located.
The application of some of these laws to digital care is unclear and subject to differing interpretation. 12 Clinicians who provide professional medical services to a patient via digital care must, in most instances, hold a valid license to practice medicine in the state in which the patient is located.
Our virtual primary care solution offers a primary care navigation hub that supports a longitudinal care experience for members, integrating virtual visits with digital behavioral health tools and condition-specific automated care programs, with escalation back to virtual and/or in person care, if needed.
Our virtual primary care solution offers a primary care navigation hub that supports a whole-person, longitudinal care experience for members, integrating virtual visits with digital behavioral health tools and condition-specific automated care programs, with escalation back to virtual and/or in person care, if needed.
Post visit, patients can access their visit record or share it with other providers in their care 3 team. They also can engage with a condition-specific automated care program that the clinician enrolled them in during or after the visit.
Post visit, patients can access their visit record or share it with other providers in their care team. They also can engage with a condition-specific automated care program that the clinician enrolled them in during or after the visit.
At our core we are: • Client First – Focused on understanding and supporting clients by embracing change, innovating and enriching patient-provide relationships; • One Team – Focused on hiring and developing outstanding people who are encouraged to stay informed and speak up, to celebrate our similarities and honor our difference, and to serve our communities; and • Deliver Awesome – Focused on bringing passion and energy, acting with integrity, working with agility and a sense of urgency, being accountable, and delivering quality in all we do.
At our core we are: • Customer First – Focused on understanding and supporting clients by embracing change, innovating and enriching patient-provide relationships; • One Team – Focused on hiring and developing outstanding people who are encouraged to stay informed and speak up, to celebrate our similarities and honor our difference, and to serve our communities; and • Deliver Awesome – Focused on bringing passion and energy, acting with integrity, working with agility and a sense of urgency, being accountable, and delivering quality in all we do.
Moreover, the government may assert that a claim including items or services resulting from a violation of the Anti-Kickback Statute constitutes a false or fraudulent claim for purposes of the False Claims Act, as discussed below.
Moreover, the government may assert that a claim including items or services resulting from a violation of the Anti-Kickback Statute 13 constitutes a false or fraudulent claim for purposes of the False Claims Act, as discussed below.
All medical professionals go through a rigorous onboarding and credential checking process. When practicing online, doctors are required to deliver care in a medically appropriate setting. We offer similar best practices and training to our clients who utilize their own providers. Patients consistently rate AMG providers highly, with an average rating of 4.9 out of 5.0.
All medical professionals go through a rigorous onboarding and credential checking process. When practicing online, doctors are required to deliver care in a medically appropriate setting. We offer similar best practices and training to our clients who utilize their own providers. Patients consistently rate AMG providers highly, with an average rating of 4.8 out of 5.0.
Certain federal courts have held that the 13 Anti-Kickback Statute can be violated if “one purpose” of a payment is to induce referrals.
Certain federal courts have held that the Anti-Kickback Statute can be violated if “one purpose” of a payment is to induce referrals.
Our future-ready, customizable and configurable enterprise platform allows clients to target specific populations and opens up new revenue sources, driving higher value. • Expanding their Carepoint suite —Clients typically increase the number of Carepoint devices over time, as they penetrate additional locations and expand their own network of digital care delivery.
Our future-ready, configurable enterprise platform allows clients to target specific populations and opens up new revenue sources, driving higher value. 7 • Expanding their Carepoint suite —Clients typically increase the number of Carepoint devices over time, as they penetrate additional locations and expand their own network of digital care delivery.
AMG contracts with providers across primary and urgent care, behavioral health therapy, acute psychiatry, lactation counseling, and nutrition to provide licensed, reimbursable medical staffing for digital care delivery to our clients. AMG can be used to augment provider capacity during nights, weekends or times of high demand.
AMG contracts with providers across primary and urgent care, behavioral health therapy, lactation counseling, and nutrition to provide licensed, reimbursable medical staffing for digital care delivery to our clients. AMG can be used to augment provider capacity during nights, weekends or times of high demand.
For urgent care, the median wait time is less than 4 minutes for the 24 months ended December 31, 2023. Research and Development Our ability to continue to differentiate and enhance our platform and offerings depends, in large part, on our capacity to continue to introduce new services, technologies, features and functionality.
For urgent care, the median wait time is less than 4 minutes for the 24 months ended December 31, 2024. Research and Development Our ability to continue to differentiate and enhance our platform and offerings depends, in large part, on our capacity to continue to introduce new services, technologies, features and functionality.
As the number of Carepoint connections rise, utilization goes up and our clients recognize additional value. We intend to continue to promote our proprietary Carepoint devices and apps across our client base as we believe that expanded Carepoint offerings such as our TV kits will further expand usage of Converge.
As the number of Carepoint connections rise, utilization goes up and our clients recognize additional value. We intend to continue to promote our proprietary Carepoint devices and apps across our client base as we believe that expanded Carepoint offerings such as our TV kits will further expand usage of the platform.
For health systems, additional solutions typically include an expanding range of specialty care use cases across the care continuum. • Enabling the sale of new solutions and services for clients to sell to their consumers and B2B customers – Many clients benefit from our scalable and customizable platform to create high value programs to sell into their clients, whether it be virtual primary care staffed by their own providers, chronic care management programs or retail urgent care.
For health systems, additional solutions typically include an expanding range of specialty care use cases across the care continuum. • Enabling the sale of new solutions and services for clients to sell to their consumers and B2B customers —Many clients benefit from our scalable and configurable platform to create high-value programs to sell to their clients, whether it be virtual primary care staffed by their own providers, chronic care management programs or retail urgent care.
Security and Reliability Converge has been designed to be secure and scalable; testing is automated and includes security scans, all vetted by our QA team. These scans are also vetted by our dedicated cybersecurity team, which includes security experts who monitor and address issues around the clock.
Security and Reliability The Amwell Converge ™ platform has been designed to be secure and scalable; testing is automated and includes security scans, all vetted by our QA team. These scans are also vetted by our dedicated cybersecurity team, which includes security experts who monitor and address issues around the clock.
For health systems, our enterprise platform enables provider-to-provider virtual care for use cases ranging from stroke and acute psychiatry evaluations to virtual nursing and e-sitting. Our suite of Carepoint TM devices can enhance in-person care, whether the clients want to turn existing equipment such as televisions or iPads into digital access points or use Amwell Carepoint carts and peripherals.
For health systems, our enterprise platform enables provider-to-provider virtual care for use cases ranging from stroke to virtual nursing and e-sitting. Our suite of Carepoint devices can enhance in-person care, whether the clients want to turn existing equipment such as televisions or iPads into digital access points or use Amwell Carepoint TM carts and peripherals.
Converge is designed to remotely implement hybrid care solutions for our clients and grow with them as they broaden their offerings. The platform allows clients the flexibility to build their optimal hybrid care model across a wide variety of use cases based on their unique needs. Health systems typically begin with on-demand and/or scheduled virtual visits.
The Amwell Converge platform is designed to remotely implement hybrid care solutions and services for our clients and grow with them as they broaden their offerings. It allows clients the flexibility to build their optimal hybrid care model across a wide variety of use cases based on their unique needs. Health systems typically begin with on-demand and/or scheduled virtual visits.
AMG offers medical staffing solutions for virtual care services that can integrate with and extend our clients' existing care capabilities. Beyond general practitioners, our AMG roster includes approximately 1,400 active behavioral health providers.
AMG offers medical staffing solutions for virtual care services that can integrate with and extend our clients' existing care capabilities. Beyond general practitioners, our AMG roster includes approximately 1,000 active behavioral health providers.
We use targeted patient and provider engagement 7 campaigns, best practices training as well as operational support to further drive an increase in usage across our platform. • Adding new solutions —Most clients begin with one or two solutions for hybrid care delivery, but then expand into additional use case.
We use targeted patient and provider engagement campaigns, best practices training as well as operational support to further drive an increase in usage across our platform. • Adding new solutions —Most clients begin with one or two solutions for hybrid care delivery, but then expand into additional use cases.
These security capabilities ensure that clients’ and patients' data are held to high standards, limiting the impact of and ability for cyberattacks. Scalability and Innovation Converge allows providers to easily expand their use of digital care, taking advantage of highly scalable managed services from best-in-class technology partners.
These security capabilities ensure that clients’ and patients' data are held to high standards, limiting the impact of and ability for cyberattacks. 9 Scalability and Innovation The Amwell Converge ™ platform allows providers to easily expand their use of digital care, taking advantage of highly scalable managed services from best-in-class technology partners.
Support for Third-Party and First-Party Applications and Solutions Converge enables clients to add their own digital assets as well as best-in-class third party solutions and activate members and patients directly from our platform.
Support for Third-Party and First-Party Applications and Solutions The Amwell Converge ™ platform enables clients to add their own digital assets as well as best-in-class third party solutions and activate members and patients directly from our platform.
We maintain relationships with key industry participants including media publications, industry analyst firms, benefit consultants, brokers, group purchasing organizations and health plan and health system partners. Channel partners also play a key role in marketing and selling our products to our client base, primarily focusing on Converge and Carepoint devices.
We maintain relationships with key industry participants including media publications, industry analyst firms, benefit consultants, brokers, group purchasing organizations and health plan and health system partners. Channel partners also play a key role in marketing and selling our products to our client base, primarily focusing on the Amwell Converge ™ platform and Carepoint devices.
We also facilitate a Blue User Group, a venue in which representatives from those Blue plans share best practices and identify common needs for innovation. Our ecosystem also is strengthened by our partnerships with innovators that bring new services and capabilities to our platform.
We also facilitate a Blue User Group, a venue in which representatives from those Blue plans share best practices and identify common needs for innovation. 6 Our ecosystem also is strengthened by our alliances with innovators that bring new services and capabilities to our platform.
Our website, including the ESG Framework available on our website, is not incorporated by reference into this report. Our commitment to viewing our business through an ESG lens is strong and we continue to be guided by three pillars: Our People, Our Products and Our Operations.
Our website, including the Corporate Responsibility Report available on our website, is not incorporated by reference into this report. Our commitment to viewing our business through an ESG lens is strong and we continue to be guided by three pillars: Our People, Our Products and Our Operations.
Amwell has and continues to build partnerships with universities and other organizations across the country and has implemented a competitive intern program to develop a diverse candidate pool. In addition, our virtual workforce strategy has allowed us to continue our focus on a global recruitment strategy to hire from all geographies in which we operate to support our diverse pipeline.
Amwell has and continues to build partnerships with universities and other organizations across the country and has implemented a competitive intern program to develop a unique candidate pool. In addition, our virtual workforce strategy has allowed us to continue our focus on a global recruitment strategy to hire from all geographies in which we operate.
We have designed Converge to be future-ready, intuitive and convenient for patients, providers and payers: • Patients and Members— For member or patient-initiated on-demand/urgent care visits, patients can elect to see the next available clinician.
We have designed our platform to be future-ready, intuitive and convenient for patients, providers and payers: • Patients and Members— For member or patient-initiated on-demand/urgent care visits, patients can elect to see the next available clinician.
Converge received a thumbs up rating by patients of over 90% for the full-year period ended December 31, 2023. • Providers— Converge is designed to deliver an easy-to-use provider experience via web or mobile device. Providers access familiar workflows for taking notes, prescribing, referencing clinical treatment guidelines and alerts for gaps in care or referral protocols.
The platform received a thumbs-up rating by patients of over 90% for the full-year period ended December 31, 2024. • Providers— The Amwell Converge platform is designed to deliver an easy-to-use provider experience via web or mobile device. Providers access familiar workflows for taking notes, prescribing, referencing clinical treatment guidelines and receiving alerts for gaps in care or referral protocols.
Our Solution To capture these opportunities, we believe clients are seeking a comprehensive solution to support their connected care goals and consolidate unintegrated vendors and in-house designed solutions. One Platform, Powering the Care Continuum Converge, our cloud-based enablement platform, is our go-forward strategy to digitally enable a single, unified, scalable healthcare experience across all care settings.
Our Solution To capture these opportunities, we believe clients are seeking a comprehensive solution to support their connected care goals and consolidate point-solution vendors and in-house designed solutions. One Platform, Powering the Care Continuum The Amwell Converge ™ platform, our cloud-based enablement platform, is our go-forward strategy to digitally enable a scalable healthcare experience across all care settings.
For patients and members, our embedded functionality simplifies hybrid care delivery directly into the portals and systems those individuals are already utilizing. Connected Ecosystem of Health Systems, Health Plans and Innovators We partner with many of the world’s largest and most trusted health systems, health plans and healthcare innovators.
For patients and members, our embedded functionality simplifies hybrid care delivery directly into the portals and systems those individuals are already utilizing. Connected Ecosystem of Health Systems, Health Plans and Innovators We have technology and care delivery partnerships with many of the world’s largest and most trusted health systems, health plans and healthcare innovators.
As we expand our capabilities, our solutions, programs and Carepoint offerings allow us to partner with clients that are new to hybrid care delivery as well as with rapidly expanding digital and hybrid care market leaders.
As we expand our capabilities, our solutions, programs and devices allow us to partner with clients that are new to hybrid care delivery as well as with rapidly expanding digital and hybrid care market leaders.
By addressing these challenges, digital care delivery offers many opportunities to improve healthcare, which include: • Solving the access crisis driven by workforce shortages and inefficient resource allocation; • Addressing increasing healthcare costs for all stakeholders; • Enabling greater care coordination; • Improving health equity; and • Optimizing patient and member experience to drive adoption and retention.
By addressing these challenges, digital care delivery offers many opportunities to improve healthcare, which include: • Solving the access crisis driven by workforce shortages and inefficient resource allocation; • Reducing healthcare costs for all stakeholders; • Enabling greater care coordination; • Improving health equity and addressing social determinants of health; and • Optimizing patient and member experience to drive adoption and retention.
Overall Platform Design for Converge User Experience The Converge platform is designed to be a consistent experience across any application, workflow or access point for both providers and patients. The entire use experience is brandable by the client, letting providers and patients know they are meeting under the trusted brand of the healthcare organization they trust, driving brand affinity.
Overall Platform Design User Experience The Amwell Converge ™ platform is designed to be a consistent experience across any application, workflow or access point for both providers and patients. The entire user experience is brandable by the client, letting providers and patients know they are meeting under the trusted brand of their preferred healthcare organization, driving brand affinity.
These automated care programs share patient data back with the care team and can escalate care back to a virtual visit when necessary and based on client implemented protocols.
These automated care programs share patient data back with the care team and can escalate care to a virtual or in-person visit when necessary and based on client-implemented protocols.
Most Medicare reimbursement flexibilities have been extended through December 31, 2024, including a waiver for geographic site restrictions (patient may be located at home), the expansion of eligible provider types, and coverage for audio-only consults.
Most Medicare reimbursement flexibilities have been extended through March 31, 2025, including a waiver for geographic site restrictions (patient may be located at home), the expansion of eligible provider types, and coverage for audio-only consults.
As of December 31, 2023, we power the digital care programs of more than 50 health plans, which collectively represent more than 100 million covered lives, as well as approximately 115 of the nation’s largest health systems.
As of December 31, 2024, we power the digital care programs of approximately 50 health plans, which collectively represent more than 80 million covered lives, as well as approximately 100 of the nation’s largest health systems.
For scheduled visits, patients are guided through customizable pre-visit readiness assessments and can enroll themselves and their dependents, enter their medical history, and check insurance coverage. Entering a visit is simple; patients just click on a link they receive in a text message or email. No app download is required.
For scheduled visits, patients are guided through configurable pre-visit readiness assessments and can enroll themselves and their dependents, enter their medical history, search for providers who meet their needs and check insurance coverage. Entering a visit is simple; patients just click on a link they receive in a text message or email. No app download is required.
We designed the platform to be future-ready, reliable, flexible, scalable, secure and fully integrated with other healthcare software systems. Converge offers state-of-the-art data architecture and video capabilities, flexibility and scalability, as well as a user experience focused on the needs of patients, members and providers.
The Amwell Converge ™ platform is the latest version of our enterprise platform software. We designed the platform to be future-ready, reliable, flexible, scalable, secure and integrated with other healthcare software systems. Our platform offers state-of-the-art data architecture and video capabilities, flexibility and scalability, as well as a user experience focused on the needs of patients, members and providers.
In addition, the improper retention of an overpayment for 60 days or more is also a basis for a False Claim Act action, even if the claim was originally submitted appropriately. Penalties for False Claims Act violations include fines and exclusion from federally funded healthcare programs.
In addition, the improper retention of an overpayment for 60 days or more is also a basis for a False Claim Act action, even if the claim was originally submitted appropriately. Penalties for False Claims Act violations include fines and exclusion from federally funded healthcare programs. In addition, some states have adopted similar fraud, whistleblower and false claims provisions.
With our platform as a Service digital care solution, there is no need for clients to purchase hardware, install and upgrade software, or manage system operations. The hosted approach also ensures that visit capacity scales without requiring client-side interventions or upgrades. We manage hosting operations and security from our NOC, which is monitored 24 hours a day.
With our platform as a service digital care solution, there is no need for clients to purchase hardware, install and upgrade software, or manage system operations. The hosted approach ensures that visit capacity scales without requiring client-side interventions or upgrades. We manage hosting operations and security, which is monitored 24/7 by our Cyber Command Center (C3) and NOC.
Our urgent care solution helps members conveniently and effectively address unplanned care needs without visiting the emergency department or local urgent care facility, driving quality outcomes at a lower cost. As of December 31, 2023, approximately 99,500 of our clients’ providers use our enterprise platform and software to serve their patients and members.
Our urgent care solution helps members conveniently and effectively address unplanned care needs without visiting the emergency department or local urgent care facility, driving quality outcomes at a lower cost. Our clients’ providers use our enterprise platform and software to serve their patients and members.
Since inception, we have powered more than 27.2 million virtual care visits for our clients, including more than 6.3 million in the year ended December 31, 2023. Our enterprise platform and software as a service solutions enable hybrid care delivery by offering our clients products to help weave digital care across all care settings.
Since inception, we have powered more than 33.1 million virtual care visits for our clients, including more than 5.9 million in the year ended December 31, 2024. Our enterprise platform and software as a service solutions enable hybrid care delivery by offering our clients products to help weave digital care across all care settings.
Our research and development team is responsible for the design, development, testing and certification of our solution. We also maintain a development office in Ramat Gan, Israel, to support our international partners and to serve as an additional development resource. In addition, we utilize certain third-party development services to perform application development.
Our research and development team is responsible for the design, development, testing and certification of our solution. We maintain development offices in Ramat Gan, Israel and Bogotá and Medellin, Colombia, to support our international partners and to serve as an additional development resources. In addition, we utilize certain third-party development services to perform application development.
Our MVP Framework serves as a guide to empower our employees to live by our mission, value and purpose (MVP) in their work for and on behalf of Amwell. MVP Framework • Culture of Inclusion – Diversity, Equity, Inclusivity & Belonging.
Our MVP Framework serves as a guide to empower our employees to live by our mission, value and purpose (MVP) in their work for and on behalf of Amwell.
Investing in our Communities Amwell Cares is our Corporate Social Responsibility Initiative. Guided by Amwell’s purpose, mission and values, Amwell Cares is committed to enriching and giving back to the communities we serve, working as One Team to drive the greatest positive impact.
Guided by Amwell’s purpose, mission and values, Amwell Cares is committed to enriching and giving back to the communities we serve, working as One Team to drive the greatest positive impact.
As of December 31, 2023, we had 1,104 full-time employees of which 88% are based in the United States, spread out across 46 states, 7% in Ireland, 3% in Israel and 2% in the UK. Recruitment In 2023, we continued to focus on building a strong pipeline of talent.
As of December 31, 2024, we had 877 full-time employees of which 83% are based in the United States, spread out across 46 states, 7% in Ireland, 4% in Israel, 4% in Colombia and 2% in the UK. Recruitment In 2024, we continued to focus on building a strong pipeline of talent.
NTN is managed by a six (6) person Board of Managing Directors, with the Chairman of the Board appointed by us. NTN’s mandate is to oversee the clinical and administrative operations of Online Care Group, a clinical entity within the AMG family.
NTN, which is consolidated in our financial statements, is greater than 50% owned by us. NTN is managed by a six (6) person Board of Managing Directors, with the Chairman of the Board appointed by us. NTN’s mandate is to oversee the clinical and administrative operations of Online Care Group, a clinical entity within the AMG family.
For example, some health systems have embedded our solutions in their own patient portals. From a provider perspective, clients are embedding the provider virtual care workflow in their EHRs so that online visits are as easy to schedule and conduct as physical visits. Sales and Marketing We sell our digital care solution through our direct sales organization.
From a provider perspective, clients are embedding the provider virtual care workflow in their EHRs so that online visits are as easy to schedule and conduct as physical visits. Sales and Marketing We sell our digital care solution through our direct sales organization.
They can enroll patients in automated care programs to augment care, when appropriate. Importantly, Converge solutions can be launched directly from within a provider’s EHR system, creating a seamless experience and reducing redundant data entry. • Payers — Access to Converge can be embedded directly into health plan portals, websites, and mobile applications, all using the health plan’s trusted brand.
Importantly, solutions can be launched directly from within a provider’s EHR system, creating a seamless experience and reducing redundant data entry. • Payers — Access to the Amwell Converge platform can be embedded directly into health plan portals, websites, and mobile applications, all using the health plan’s trusted brand.
Additional provider-centric solutions include specialty consults, virtual nursing, automated care, behavioral health, and more. With our enterprise platform and software as a service, clients can seamlessly activate additional solutions on Converge as new needs arise, all working together to create a more connected experience for patients and providers.
Additional provider-centric solutions include specialty consults, virtual nursing, automated care, behavioral health, and more. Clients can seamlessly activate additional solutions on the platform as new needs arise, all working together to create a more connected experience for patients and providers. Health plans typically begin with urgent care, virtual primary care, or behavioral health.
The telehealth of yesterday has grown to encompass hybrid care delivery models and the flow of data that drives healthcare. 2 Converge delivers the digital capabilities that health systems and health plans care about — for example, virtual primary care, post-discharge follow-up, chronic condition management, virtual nursing — and aligns them into a single digital care operating system that aggregates all of the data from these care experiences to provide real-time insight.
The Amwell Converge ™ platform delivers the digital capabilities that health systems and health plans care about — for example, virtual primary care, post-discharge follow-up, chronic condition management, virtual nursing — and aligns them into a single digital care operating system that aggregates all of the data from these care experiences to provide real-time insight.
In addition, state laws are changing rapidly, and there is discussion of a new federal privacy law or federal breach notification law, to which we may be subject. 15 In addition to HIPAA and state health information privacy laws, we may be subject to other state and federal privacy laws, including laws that prohibit unfair privacy and security acts or practices and deceptive statements about privacy and security and laws that place specific requirements on certain types of activities, such as data security and texting.
In addition to HIPAA and state health information privacy laws, we may be subject to other state and federal privacy laws, including laws that prohibit unfair privacy and security acts or practices and deceptive statements about privacy and security and laws that place specific requirements on certain types of activities, such as data security and texting.
Employees also are encouraged to volunteer on their own and are given a designated volunteer day to allow them time to give back in their local community. In 2023, Amwell donated more than $140,000 in cash and pro bono healthcare services to support our local communities.
Employees also are encouraged to volunteer on their own and are given a designated volunteer day to allow them time to give back in their local community. In 2024, Amwell continues to donate cash and pro bono healthcare services to support our local communities. Employees also volunteered more than 200 hours of their time to support their communities.
This ability for healthcare organizations to seamlessly enable their own trusted providers and networks to deliver care on our best-in-class hybrid care platform – and the ability to supplement with our clinical services using AMG as needed - differentiates us in the industry.
This ability for healthcare organizations to seamlessly enable their own trusted providers and networks to deliver care on our best-in-class hybrid care platform – and the ability to supplement with our clinical services using AMG as needed - differentiates us in the industry. 5 Flexible and Scalable Suite of Solutions Our scalable solutions allow us to grow with the digital and hybrid care delivery needs of our clients.
We never forget that beyond the daily numbers and operating tasks, our goal is to transform how healthcare is delivered by improving access, convenience, economics and quality of care via digital care for all.
Social Responsibility & Health Equity Social responsibility is deeply embedded in our mission-oriented corporate culture. We never forget that beyond the daily numbers and operating tasks, our goal is to transform how healthcare is delivered by improving access, convenience, economics and quality of care via digital care for all.
Our Board consists of nine (9) directors, 22% identifying as diverse and 78% are independent, who bring a diversity of perspectives, experience, and backgrounds to their role of monitoring and advising management.
Our Board consists of nine (9) directors, of whom 22% are women and 78% are independent, who bring a variety of perspectives, experience, and backgrounds to their role of supervising and advising management.
Our Products The primary product we sell is access to our enterprise platform and software via recurring subscriptions. We sell additional related services and solutions via configurable modules and programs and Carepoint devices and services, including implementation, engagement, cart fleet management and integration. These additional services can be added to any base platform subscription.
Our Products The primary product we sell is access to the Amwell Converge platform, our enterprise, digital care delivery platform and software, via recurring subscriptions. We sell additional related services and solutions via configurable modules, partner programs, and Carepoint devices and services, including implementation, engagement, cart fleet management and integration.
During the fourth quarter of 2023, 52% of our visits were provided on Converge, which was an increase from 28% in the fourth quarter of 2022. A major strategic focus for us in 2024 is to continue the migration of our remaining health plan and health system clients onto Converge.
During the fourth quarter of 2024, 67% of our visits were provided on this platform, which was an increase from 52% in the fourth quarter of 2023. A strategic focus for us in 2025 is to continue the migration of health plan and health system clients onto the platform as soon as it is feasible for those clients.
It has been designed from the ground up with the holistic understanding that the future of care of any one person will inevitably blend a mix of in-person, virtual and automated experiences.
It has been designed from the ground up with the holistic understanding that the future of care of any one person will inevitably blend a mix of in-person, virtual and automated care experiences. The telehealth of yesterday has grown to encompass hybrid care delivery models and the flow of data that drives healthcare.
It has been the historical practice of the parties to review and adjust this fee on an annual basis. In addition, we have signed direct transfer agreements with the AMG entities. These direct transfer agreements outline the conditions under which we have the right to change the ownership of the clinical entity to a different third party.
It has been the historical practice of the parties to review and adjust this fee on an annual basis. In addition, we have signed direct transfer agreements with the AMG entities.
These avenues have provided us with valuable perspectives that have shaped our investments in programs and initiatives for our employees. In 2023, employee feedback shaped the creation of our MVP Framework, Total Rewards Framework, and internal communication improvements.
These avenues have provided us with valuable perspectives that have shaped our investments in programs and initiatives for our employees. Employee feedback shaped the creation of our MVP Framework, Total Rewards Framework, and internal communication improvements. The Amwell employee voice is the most powerful tool we have for increasing our engagement and the development of a strong and inclusive team.
To ensure we are creating equal and equitable access to care globally, we seek to improve outcomes in care disparities and social determinants of health by leveraging our unique place in the healthcare ecosystem. Intellectual Property Our patent portfolio consists of approximately 43 patents and 4 pending patent applications related to our software and technology.
To ensure we are creating equal and equitable access to care globally, we seek to improve outcomes in care disparities and social determinants of health by leveraging our unique place in the healthcare ecosystem.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeIf we are unable to address the needs of our clients or consumers, or our clients or consumers are unsatisfied with the quality of our solution or services, they may not renew their contracts, seek to cancel or terminate their relationship with us or renew on less favorable terms, any of which could cause our annual net dollar retention rate to decrease. 29 The estimates of market opportunity and forecasts of market growth included in this Annual Report may prove to be inaccurate, and even if the market in which we compete achieves the forecasted growth, our business could fail to grow at similar rates, if at all.
Biggest changeIf we are unable to address the needs of our clients or consumers, or our clients or consumers are unsatisfied with the quality of our solution or services, they may not renew their contracts, seek to cancel or terminate their relationship with us or renew on less favorable terms, any of which could cause our annual net dollar retention rate to decrease.
For example, there have been and continue to be a number of initiatives at the United States federal and state levels that seek to reduce healthcare costs, including the Budget Control Act (which, subject to certain sequestration periods, imposed 2% reductions in Medicare payments to providers per fiscal year) and the American Taxpayer Relief Act (which, among other things, further reduced Medicare payments to several types of providers, including hospitals, imaging centers and cancer treatment centers, and increased the statute of limitations period for the government to recover overpayments to providers from three to five 25 years).
For example, there have been and continue to be a number of initiatives at the United States federal and state levels that seek to reduce 25 healthcare costs, including the Budget Control Act (which, subject to certain sequestration periods, imposed 2% reductions in Medicare payments to providers per fiscal year) and the American Taxpayer Relief Act (which, among other things, further reduced Medicare payments to several types of providers, including hospitals, imaging centers and cancer treatment centers, and increased the statute of limitations period for the government to recover overpayments to providers from three to five years).
Similar to the federal Anti-Kickback Statute, a person or entity does not need to have actual knowledge of the statute or specific intent to violate it to have committed a violation; • HIPAA, which also imposes certain regulatory and contractual requirements regarding the privacy, security and transmission of PHI; • the federal False Claims Act that imposes civil and criminal liability on individuals or entities that knowingly submit false or fraudulent claims for payment to the government or knowingly making, or causing to be made, a false statement in order to have a false claim paid, including qui tam or whistleblower suits; • the federal Civil Monetary Law prohibits, among other things, the offering or transfer of remuneration to a Medicare or state healthcare program beneficiary if the person knows or should know it is likely to influence the beneficiary’s selection of a particular provider, practitioner, or supplier of services reimbursable by Medicare or a state healthcare program, unless an exception applies; • reassignment of payment rules that prohibit certain types of billing and collection practices in connection with claims payable by the Medicare or Medicaid programs; • similar state law provisions pertaining to Anti-Kickback, self-referral and false claims issues, some of which may apply to items or services reimbursed by any third party payer, including commercial insurers or services paid out-of-pocket by patients; • state laws that prohibit general business corporations, such as us, from practicing medicine, controlling physicians’ medical decisions or engaging in some practices such as splitting fees with physicians; 45 • the Federal Trade Commission Act and federal and state consumer protection, advertisement and unfair competition laws, which broadly regulate marketplace activities and activities that could potentially harm consumers; • laws that regulate debt collection practices as applied to our debt collection practices; • a provision of the Social Security Act that imposes criminal penalties on healthcare providers who fail to disclose or refund known overpayments; • federal and state laws that prohibit providers from billing and receiving payment from Medicare and Medicaid for services unless the services are medically necessary, adequately and accurately documented, and billed using codes that accurately reflect the type and level of services rendered; and • federal and state laws and policies that require healthcare providers to maintain licensure, certification or accreditation to provide physician and other professional services, to enroll and participate in the Medicare and Medicaid programs, to report certain changes in their operations to the agencies that administer these programs, as well as state insurance laws.
Similar to the federal Anti-Kickback Statute, a person or entity does not need to have actual knowledge of the statute or specific intent to violate it to have committed a violation; • HIPAA, which also imposes certain regulatory and contractual requirements regarding the privacy, security and transmission of PHI; • the federal False Claims Act that imposes civil and criminal liability on individuals or entities that knowingly submit false or fraudulent claims for payment to the government or knowingly making, or causing to be made, a false statement in order to have a false claim paid, including qui tam or whistleblower suits; • the federal Civil Monetary Law prohibits, among other things, the offering or transfer of remuneration to a Medicare or state healthcare program beneficiary if the person knows or should know it is likely to influence the beneficiary’s selection of a particular provider, practitioner, or supplier of services reimbursable by Medicare or a state healthcare program, unless an exception applies; • reassignment of payment rules that prohibit certain types of billing and collection practices in connection with claims payable by the Medicare or Medicaid programs; • similar state law provisions pertaining to Anti-Kickback, self-referral and false claims issues, some of which may apply to items or services reimbursed by any third party payer, including commercial insurers or services paid out-of-pocket by patients; • state laws that prohibit general business corporations, such as us, from practicing medicine, controlling physicians’ medical decisions or engaging in some practices such as splitting fees with physicians; • the Federal Trade Commission Act and federal and state consumer protection, advertisement and unfair competition laws, which broadly regulate marketplace activities and activities that could potentially harm consumers; • laws that regulate debt collection practices as applied to our debt collection practices; • a provision of the Social Security Act that imposes criminal penalties on healthcare providers who fail to disclose or refund known overpayments; • federal and state laws that prohibit providers from billing and receiving payment from Medicare and Medicaid for services unless the services are medically necessary, adequately and accurately documented, and billed using codes that accurately reflect the type and level of services rendered; and • federal and state laws and policies that require healthcare providers to maintain licensure, certification or accreditation to provide physician and other professional services, to enroll and participate in the Medicare and Medicaid programs, to report certain changes in their operations to the agencies that administer these programs, as well as state insurance laws.
Our quarterly financial results may fluctuate as a result of a variety of factors, many of which are outside of our control, including, without limitation, the following: • the addition or loss of large clients, including through acquisitions or consolidations of such clients; • seasonal and other variations in the timing of the sales of our services; • historically, a significantly higher proportion of our clients’ members and patients use our services during peak cold and flu season months, the future impact of seasonal viruses is unknown as there could be additional surges and demand on digital care visits; • the timing of recognition of revenue, including possible delays in the recognition of revenue due to sometimes unpredictable implementation timelines; • the amount and timing of operating expenses related to the maintenance and expansion of our business, operations and infrastructure; • our ability to effectively manage the size and composition of our proprietary network of healthcare professionals relative to the level of demand for services from our clients’ members and patients; • the timing and success of introductions of new products and services by us or our competitors or any other change in the competitive dynamics of our industry, including consolidation among competitors, clients or strategic partners; • client renewal rates and the timing and terms of client renewals; • the mix of products and services sold during a period; and • the timing of expenses related to the development or acquisition of technologies or businesses and potential future charges for impairment of goodwill from acquired companies.
Our quarterly financial 29 results may fluctuate as a result of a variety of factors, many of which are outside of our control, including, without limitation, the following: • the addition or loss of large clients, including through acquisitions or consolidations of such clients; • seasonal and other variations in the timing of the sales of our services; • historically, a significantly higher proportion of our clients’ members and patients use our services during peak cold and flu season months, the future impact of seasonal viruses is unknown as there could be additional surges and demand on digital care visits; • the timing of recognition of revenue, including possible delays in the recognition of revenue due to sometimes unpredictable implementation timelines; • the amount and timing of operating expenses related to the maintenance and expansion of our business, operations and infrastructure; • our ability to effectively manage the size and composition of our proprietary network of healthcare professionals relative to the level of demand for services from our clients’ members and patients; • the timing and success of introductions of new products and services by us or our competitors or any other change in the competitive dynamics of our industry, including consolidation among competitors, clients or strategic partners; • client renewal rates and the timing and terms of client renewals; • the mix of products and services sold during a period; and • the timing of expenses related to the development or acquisition of technologies or businesses and potential future charges for impairment of goodwill from acquired companies.
For example, our amended and restated certificate of incorporation and amended and restated by-laws collectively: • authorize three classes of common stock with disparate voting power, the Class A common stock that is listed on the NYSE, the Class B common stock that provide the holders thereof with the ability to control the outcome of matters requiring stockholder approval, even though such holders own significantly less than a majority of the shares of our outstanding Class A, Class B and Class C common stock, and the Class C common stock that do not have a vote on director elections; • authorize the issuance of “blank check” preferred stock that could be issued by our board of directors to prevent a takeover attempt; • authorize the classification of our Board of Directors into separate classes of directors to be elected on a staggered basis; • prohibit stockholders from calling special meetings of stockholders; • prohibit stockholder action by written consent, thereby requiring all actions to be taken at a duly called meeting of the stockholders; 50 • require the approval of holders of at least 75% of the total combined voting power of the outstanding shares of our common stock to amend our amended and restated by-laws and certain provisions of our amended and restated certificate of incorporation; and • provide for notice procedures that stockholders must comply with in order to nominate candidates to our board of directors or to propose matters to be acted upon at a stockholders’ meeting, which may discourage or deter a potential acquirer from conducting a solicitation of proxies to elect the acquirer’s own slate of directors or otherwise attempting to obtain control of us.
For example, our amended and restated certificate of incorporation and amended and restated by-laws collectively: • authorize three classes of common stock with disparate voting power, the Class A common stock that is listed on the NYSE, the Class B common stock that provide the holders thereof with the ability to control the outcome of matters requiring stockholder approval, even though such holders own significantly less than a majority of the shares of our outstanding Class A, Class B and Class C common stock, and the Class C common stock that do not have a vote on director elections; • authorize the issuance of “blank check” preferred stock that could be issued by our board of directors to prevent a takeover attempt; • authorize the classification of our Board of Directors into separate classes of directors to be elected on a staggered basis; • prohibit stockholders from calling special meetings of stockholders; • prohibit stockholder action by written consent, thereby requiring all actions to be taken at a duly called meeting of the stockholders; • require the approval of holders of at least 75% of the total combined voting power of the outstanding shares of our common stock to amend our amended and restated by-laws and certain provisions of our amended and restated certificate of incorporation; and • provide for notice procedures that stockholders must comply with in order to nominate candidates to our board of directors or to propose matters to be acted upon at a stockholders’ meeting, which may discourage or deter a potential acquirer from conducting a solicitation of proxies to elect the acquirer’s own slate of directors or otherwise attempting to obtain control of us.
Of particular importance are: • the federal physician self-referral law, commonly referred to as the Stark Law, that, unless one of the statutory or regulatory exceptions apply, prohibits physicians from referring Medicare or Medicaid patients to an entity for the provision of certain “designated health services” if the physician or a member of such physician’s immediate family has a direct or indirect financial relationship (including an ownership interest or a compensation arrangement) with the entity, and prohibit the entity from billing Medicare or Medicaid for such designated health services; • the federal Anti-Kickback Statute that prohibits the knowing and willful offer, payment, solicitation or receipt of any bribe, kickback, rebate or other remuneration for referring an individual, in return for ordering, leasing, purchasing or recommending or arranging for or to induce the referral of an individual or the ordering, purchasing or leasing of items or services covered, in whole or in part, by any federal healthcare program, such as Medicare and Medicaid.
Of particular importance are: • the federal physician self-referral law, commonly referred to as the Stark Law, that, unless one of the statutory or regulatory exceptions apply, prohibits physicians from referring Medicare or Medicaid patients to an entity for the provision of certain “designated health services” if the physician or a member of such physician’s immediate family has a direct or indirect financial relationship (including an ownership interest or a compensation arrangement) with the entity, and prohibit the entity from billing Medicare or Medicaid for such designated health services; 44 • the federal Anti-Kickback Statute that prohibits the knowing and willful offer, payment, solicitation or receipt of any bribe, kickback, rebate or other remuneration for referring an individual, in return for ordering, leasing, purchasing or recommending or arranging for or to induce the referral of an individual or the ordering, purchasing or leasing of items or services covered, in whole or in part, by any federal healthcare program, such as Medicare and Medicaid.
The market price for our Class A common stock may be influenced by many factors, including, but not limited to: • the success of competitive products or technologies; • developments related to our existing or any future collaborations; • regulatory or legal developments in the United States and other countries; • developments or disputes concerning our intellectual property or other proprietary rights; • the recruitment or departure of key personnel; • actual or anticipated changes in estimates as to financial results, development timelines or recommendations by securities analysts; • variations in our financial results or those of companies that are perceived to be similar to us; • changes in the structure of healthcare payment systems; • general economic, industry and market conditions; and • the other factors described in this “Risk Factors” section.
The market price for our Class A common stock may be influenced by many factors, including, but not limited to: • the success of competitive products or technologies; • developments related to our existing or any future collaborations; 51 • regulatory or legal developments in the United States and other countries; • developments or disputes concerning our intellectual property or other proprietary rights; • the recruitment or departure of key personnel; • actual or anticipated changes in estimates as to financial results, development timelines or recommendations by securities analysts; • variations in our financial results or those of companies that are perceived to be similar to us; • changes in the structure of healthcare payment systems; • general economic, industry and market conditions; and • the other factors described in this “Risk Factors” section.
Health epidemics, pandemics and other public health emergencies could cause disruptions and severely impact our business, including, but not limited to: negatively impacting our clients’ business, as well as loss of employment, resulting in difficulty collecting accounts receivable and/or fewer fees generated; negatively impacting our ability to facilitate the provision of our services to health system, health plan or innovator clients due to unpredictable demand; creating regulatory uncertainty if certain restrictions on reimbursement or the practice of medicine across state lines are reintroduced in the future; and harming our business, results of operations and financial condition.
Health epidemics, pandemics and other public health emergencies could cause disruptions and severely impact our business, including, but not limited to: negatively impacting our clients’ business, as well as loss of employment, resulting in difficulty collecting accounts receivable and/or fewer fees generated; negatively impacting our ability to facilitate the provision of our services to health system, health plan or innovator clients due to unpredictable demand; creating regulatory 27 uncertainty if certain restrictions on reimbursement or the practice of medicine across state lines are reintroduced in the future; and harming our business, results of operations and financial condition.
While we strive to comply with all applicable privacy and 46 security laws and regulations, as well as our own posted privacy policies, legal standards for privacy, including but not limited to “unfairness” and “deception,” as enforced by the FTC and state attorneys general, continue to evolve and any failure or perceived failure to comply may result in proceedings or actions against us by government entities or others, or could cause us to lose clients, which could have a material adverse effect on our business.
While we strive to comply with all applicable privacy and security laws and regulations, as well as our own posted privacy policies, legal standards for privacy, including but not limited to “unfairness” and “deception,” as enforced by the FTC and state attorneys general, continue to evolve and any failure or perceived failure to comply may result in proceedings or actions against us by government entities or others, or could cause us to lose clients, which could have a material adverse effect on our business.
Any potential security breach could also result in increased costs associated with liability for 48 stolen assets or information, repairing system damage that may have been caused by such breaches, incentives offered to clients or other business partners in an effort to maintain our business relationships after a breach and implementing measures to prevent future occurrences, including organizational changes, deploying additional personnel and protection technologies, training employees and engaging third-party experts and consultants.
Any potential security breach could also result in increased costs associated with liability for stolen assets or information, repairing system damage that may have been caused by such breaches, incentives offered to clients or other business partners in an effort to maintain our business relationships after a breach and implementing measures to prevent future occurrences, including organizational changes, deploying additional personnel and protection technologies, training employees and engaging third-party experts and consultants.
Foreign Corrupt Practices Act of 1977 (“FCPA”) and other anti-corruption laws and regulations; • changes to economic sanctions laws and regulations; • central bank and other restrictions on our ability to repatriate cash from international subsidiaries; • adverse tax consequences; • fluctuations in currency exchange rates, economic instability and inflationary conditions, which could make our solution more expensive or increase our costs of doing business in certain countries; • limitations on future growth or inability to maintain current levels of revenues from international sales if we do not invest sufficiently in our international operations; • different pricing environments, longer sales cycles and longer accounts receivable payment cycles and collections issues; • difficulties in staffing, managing and operating our international operations, including difficulties related to administering our stock plans in some foreign countries and increased financial accounting and reporting requirements and complexities; • difficulties in coordinating the activities of our geographically dispersed and culturally diverse operations; and • political unrest, war, terrorism or regional natural disasters, particularly in areas in which we have facilities.
Foreign Corrupt Practices Act of 1977 (“FCPA”) and other anti-corruption laws and regulations; • changes to economic sanctions laws and regulations; • central bank and other restrictions on our ability to repatriate cash from international subsidiaries; • adverse tax consequences; • fluctuations in currency exchange rates, economic instability and inflationary conditions, which could make our solution more expensive or increase our costs of doing business in certain countries; • limitations on future growth or inability to maintain current levels of revenues from international sales if we do not invest sufficiently in our international operations; • different pricing environments, longer sales cycles and longer accounts receivable payment cycles and collections issues; • difficulties in staffing, managing and operating our international operations, including difficulties related to administering our stock plans in some foreign countries and increased financial accounting and reporting requirements and complexities; • difficulties in coordinating the activities of our geographically dispersed operations; and • political unrest, war, terrorism or regional natural disasters, particularly in areas in which we have facilities.
The failure of AMG to maintain or to secure new cost-effective provider contracts may result in a loss of or inability to grow our consumer base, higher costs, healthcare provider network 28 disruptions, less attractive clinical services for our clients and/or difficulty in meeting regulatory or accreditation requirements, any of which could have a material adverse effect on our business, financial condition and results of operations.
The failure of AMG to maintain or to secure new cost-effective provider contracts may result in a loss of or inability to grow our consumer base, higher costs, healthcare provider network disruptions, less attractive clinical services for our clients and/or difficulty in meeting regulatory or accreditation requirements, any of which could have a material adverse effect on our business, financial condition and results of operations.
For additional information, see Part II, Item 7: Management’s Discussion & Analysis of Financial Condition and Results of Operations under the sub-heading “Critical Accounting Policies and Estimates—Goodwill and Intangible Assets.” Risks Related to Our Business and Industry The digital care market is still developing and volatile and may develop slower than we expect and be subject to negative publicity.
For additional information, see Part II, Item 7: Management’s Discussion & Analysis of Financial Condition and Results of Operations under the sub-heading “Critical Accounting Policies and Estimates— Intangible Assets.” Risks Related to Our Business and Industry The digital care market is still developing and volatile and may develop slower than we expect and be subject to negative publicity.
The foregoing provision does not apply to claims arising under the Securities Act, the Exchange Act or other federal securities laws for which there is exclusive federal or concurrent federal and state jurisdiction 51 Additionally, unless we consent in writing to the selection of an alternative forum, the federal district courts of the United States of America shall be the exclusive forum for the resolution of any complaint asserting a cause of action arising under the Securities Act.
The foregoing provision does not apply to claims arising under the Securities Act, the Exchange Act or other federal securities laws for which there is exclusive federal or concurrent federal and state jurisdiction Additionally, unless we consent in writing to the selection of an alternative forum, the federal district courts of the United States of America shall be the exclusive forum for the resolution of any complaint asserting a cause of action arising under the Securities Act.
Our software is used not just for telehealth itself but also handling insurance eligibility, medical record access, payment. claims submission, artificial intelligence based chat with patients and training patients on coping with behavioral health issues. Therefore, users of our software are less tolerant of errors than the market for other types of technologies generally.
Our software is used not just for telehealth itself but also handling insurance eligibility, medical record access, payment. claims 35 submission, artificial intelligence based chat with patients and training patients on coping with behavioral health issues. Therefore, users of our software are less tolerant of errors than the market for other types of technologies generally.
We also maintain general liability coverage; however, this coverage may not continue to be available on acceptable terms, may not be available in sufficient amounts to cover one or more large claims against us, and may include larger self-insured retentions or exclusions for certain products. In addition, the insurer might disclaim coverage as to any future claim.
We also maintain general liability coverage; however, this coverage may not continue to be available on acceptable terms, may not be available in sufficient amounts to cover one or more large claims 38 against us, and may include larger self-insured retentions or exclusions for certain products. In addition, the insurer might disclaim coverage as to any future claim.
The ability to develop and maintain satisfactory relationships with providers also may be negatively impacted by other factors not associated with us, such as changes in Medicare and/or Medicaid reimbursement levels, state physician licensing laws and standard of care requirements, and other pressures on healthcare providers and consolidation activity among hospitals, physician groups and healthcare providers.
The ability to develop and maintain satisfactory relationships with providers also may be negatively impacted by other factors not associated with us, such as changes in Medicare and/or Medicaid reimbursement levels, state physician licensing laws and standard of care requirements, and other pressures on healthcare providers and consolidation activity 28 among hospitals, physician groups and healthcare providers.
We serve all of our U.S. based clients and consumers from two geographically dispersed data centers. While we control and have access to our servers, we do not control the operation of these facilities. The owners of our data center facilities 32 have no obligation to renew their agreements with us on commercially reasonable terms, or at all.
We serve all of our U.S. based clients and consumers from two geographically dispersed data centers. While we control and have access to our servers, we do not control the operation of these facilities. The owners of our data center facilities have no obligation to renew their agreements with us on commercially reasonable terms, or at all.
Any such disclosure would have a negative effect on our business and the value of our proprietary software. Third parties may challenge the validity of our patents and trademarks, or oppose our patent and trademark applications. We may not be able to obtain and enforce additional patents to protect our proprietary rights from use by potential competitors.
Any such disclosure would have a negative effect on our business and the value of our proprietary software. 36 Third parties may challenge the validity of our patents and trademarks, or oppose our patent and trademark applications. We may not be able to obtain and enforce additional patents to protect our proprietary rights from use by potential competitors.
These clients may not renew their contracts, seek to terminate their relationship with us or renew on less favorable terms. Moreover, negative publicity related to our client relationships, regardless of its accuracy, may further damage our business by affecting our reputation or ability to compete for new business with current and prospective 35 clients.
These clients may not renew their contracts, seek to terminate their relationship with us or renew on less favorable terms. Moreover, negative publicity related to our client relationships, regardless of its accuracy, may further damage our business by affecting our reputation or ability to compete for new business with current and prospective clients.
If we fail to successfully enforce our intellectual property rights, our competitive position could suffer, which could harm our operating results. Regardless of the outcome, the cost and distraction associated with any such enforcement efforts could harm our business. 37 We could incur substantial costs as a result of any claim of infringement of another party’s intellectual property rights.
If we fail to successfully enforce our intellectual property rights, our competitive position could suffer, which could harm our operating results. Regardless of the outcome, the cost and distraction associated with any such enforcement efforts could harm our business. We could incur substantial costs as a result of any claim of infringement of another party’s intellectual property rights.
Were this to occur, there is no guarantee that we would be able to compensate for the loss in revenue from 26 employers by increasing sales of our solution to health insurance companies or to individuals or government agencies. In such a case, our results of operations would be adversely affected.
Were this to occur, there is no guarantee that we would be able to compensate for the loss in revenue from employers by increasing sales of our solution to health insurance companies or to individuals or government agencies. In such a case, our results of operations would be adversely affected.
Any future, litigation, whether or not successful, could be extremely costly to defend, divert our management’s time, attention and resources, damage our reputation and brand and substantially harm our business. We employ individuals who were previously employed at other companies in our field, including our competitors or potential competitors.
Any future, litigation, whether or not successful, could be 37 extremely costly to defend, divert our management’s time, attention and resources, damage our reputation and brand and substantially harm our business. We employ individuals who were previously employed at other companies in our field, including our competitors or potential competitors.
The failure to adequately comply with these future laws and regulations may delay or possibly prevent some of our products or services from being 44 offered to clients, or their members and patients, which could have a material adverse effect on our business, financial condition and results of operations.
The failure to adequately comply with these future laws and regulations may delay or possibly prevent some of our products or services from being offered to clients, or their members and patients, which could have a material adverse effect on our business, financial condition and results of operations.
Some of our clients undertake a significant and prolonged evaluation process, including to determine whether our services meet their unique healthcare needs, which frequently involves evaluation of not only our solution but also an evaluation of those of our competitors, which has in the past resulted in extended sales cycles.
Some of our clients undertake a significant and prolonged evaluation process, including to determine whether our services meet their unique healthcare needs, which frequently involves 30 evaluation of not only our solution but also an evaluation of those of our competitors, which has in the past resulted in extended sales cycles.
In addition, any financial difficulties, such as bankruptcy faced by our third-party data centers operators or any of the service providers with whom we or they contract may have negative effects on our business, the nature and extent of which are difficult to predict.
In 32 addition, any financial difficulties, such as bankruptcy faced by our third-party data centers operators or any of the service providers with whom we or they contract may have negative effects on our business, the nature and extent of which are difficult to predict.
AMG carries professional liability insurance for itself and each of its healthcare professionals, and we separately carry a professional liability insurance policy, which covers medical malpractice claims and covers our existing subsidiaries. In addition, professional liability insurance is expensive and insurance premiums may increase significantly in the future, particularly as 38 we expand our services.
AMG carries professional liability insurance for itself and each of its healthcare professionals, and we separately carry a professional liability insurance policy, which covers medical malpractice claims and covers our existing subsidiaries. In addition, professional liability insurance is expensive and insurance premiums may increase significantly in the future, particularly as we expand our services.
Negative publicity concerning our services or the digital care market as a whole could limit market acceptance of our services. For example, there has been and continue to be substantial media coverage in the U.S. surrounding mental health and virtual health services, including the virtual prescription of mental health prescription drugs.
Negative publicity concerning our services or the digital care market as a whole could limit market acceptance of our services. For example, there has been and continue to be substantial media 24 coverage in the U.S. surrounding mental health and virtual health services, including the virtual prescription of mental health prescription drugs.
Our success and execution of our business strategy depends heavily upon our ability to attract and retain key members of senior management and a diverse and skilled workforce generally. The members of senior management are at-will employees and therefore they may terminate employment with us at any time with no advance notice.
Our success and execution of our business strategy depends heavily upon our ability to attract and retain key members of senior management and a skilled workforce generally. The members of senior management are at-will employees and therefore they may terminate employment with us at any time with no advance notice.
For example, our Founders will be able to control the amendments of our amended and restated certificate of incorporation or by-laws, increases to the number of shares available for issuance under 49 our equity incentive plans or adoption of new equity incentive plans and approval of any merger or sale of assets for the foreseeable future.
For example, our Founders will be able to control the amendments of our amended and restated certificate of incorporation or by-laws, increases to the number of shares available for issuance under our equity incentive plans or adoption of new equity incentive plans and approval of any merger or sale of assets for the foreseeable future.
Among these important risks are the following: • our history of losses and the risk we may not achieve profitability; • our limited number of significant clients (including our largest client by revenue, Elevance Health, which accounted for 25%, 23% and 24% of our revenue for the years ended December 31, 2021, 2022 and 2023, respectively) and the risk that we may lose their business; • weak growth and increased volatility in the digital care market; • inability to adapt to rapid technological changes; • increased competition from existing and potential new participants in the healthcare industry; • our clients’ acceptance of Converge and our ability and the costs to further develop this platform; • changes in healthcare laws, regulations or trends as well as our ability to operate in the heavily regulated healthcare industry; • slower than expected growth in patient adoption of digital care and in platform usage by either clients or patients; • the impact of seasonal viruses on our business or on our ability to forecast our business’s financial outlook; • inability to grow our base of affiliated and non-affiliated providers utilizing the Amwell Platform to a number sufficient to serve patient demand; • our ability to comply with federal, state and foreign privacy regulations and the significant liability that could result from a cybersecurity breach or our failure to comply with such regulations; and • holders of our Class A common stock have limited or no ability to influence corporate matters due to the multiple class structure of our common stock and the ownership of Class B common stock by Ido Schoenberg and Roy Schoenberg (the “Founders”), which will have the effect of concentrating voting control with our founders for the foreseeable future.
Among these important risks are the following: • our history of losses and the risk we may not achieve profitability; • our limited number of significant clients (including our largest client by revenue, Elevance Health, which accounted for 23%, 24% and 27% of our revenue for the years ended December 31, 2022, 2023 and 2024, respectively) and the risk that we may lose their business; • weak growth and increased volatility in the digital care market; • inability to adapt to rapid technological changes; • increased competition from existing and potential new participants in the healthcare industry; • our clients’ acceptance of the Amwell Converge ™ platform and our ability and the costs to further develop this platform; • changes in healthcare laws, regulations or trends as well as our ability to operate in the heavily regulated healthcare industry; • slower than expected growth in patient adoption of digital care and in platform usage by either clients or patients; • the impact of seasonal viruses on our business or on our ability to forecast our business’s financial outlook; • inability to grow our base of affiliated and non-affiliated providers utilizing the Amwell Platform to a number sufficient to serve patient demand; • our ability to comply with federal, state and foreign privacy regulations and the significant liability that could result from a cybersecurity breach or our failure to comply with such regulations; and • holders of our Class A common stock have limited or no ability to influence corporate matters due to the multiple class structure of our common stock and the ownership of Class B common stock by Ido Schoenberg and Roy Schoenberg (the “Founders”), which will have the effect of concentrating voting control with our founders for the foreseeable future.
Our prior losses, combined with our expected future losses, have had and will continue to have an adverse effect on our stockholders’ equity and working capital. A significant portion of our revenue comes from a limited number of clients and we may be unable to retain our key clients.
Our prior losses, combined with our expected future losses, have had and will continue to have an adverse effect on our stockholders’ equity and working capital. 23 A significant portion of our revenue comes from a limited number of clients and we may be unable to retain our key clients.
It is possible that conflicts may arise with our collaborators, such as conflicts concerning the achievement of performance milestones, or the interpretation of significant terms under any agreement, such as those related to financial obligations or the ownership or control of intellectual property developed during the collaboration.
It is possible that conflicts may arise with our collaborators, such as conflicts concerning the achievement of performance milestones, or the interpretation of significant terms under any agreement, such as those related to financial obligations or the 41 ownership or control of intellectual property developed during the collaboration.
Accordingly, we may face claims from others claiming ownership of, or seeking to enforce the license terms applicable to such open-source software, including by demanding release of the open-source software, derivative works or our proprietary source code that was developed or 36 distributed with such software.
Accordingly, we may face claims from others claiming ownership of, or seeking to enforce the license terms applicable to such open-source software, including by demanding release of the open-source software, derivative works or our proprietary source code that was developed or distributed with such software.
We are subject to laws and regulations relating to the collection, use, retention, security and transfer of this information. Because of the extreme sensitivity of the information we store and transmit, the security features of our and our third-party vendors’ computer, network, and communications systems infrastructure are critical to the success of our business.
We are subject to laws and regulations relating to the collection, use, retention, security and transfer of this information. Because of the extreme sensitivity of the 33 information we store and transmit, the security features of our and our third-party vendors’ computer, network, and communications systems infrastructure are critical to the success of our business.
Where state laws are more protective than HIPAA, we have 47 to comply with the stricter provisions. Violations of these laws could result in significant fines and penalties, and, if these laws afford private rights of action to individuals, data breach litigation.
Where state laws are more protective than HIPAA, we have to comply with the stricter provisions. Violations of these laws could result in significant fines and penalties, and, if these laws afford private rights of action to individuals, data breach litigation.
The extent to which each state considers particular actions or contractual relationships to constitute improper influence of professional judgment varies 43 across the states and is subject to change and to evolving interpretations by state boards of medicine and state attorneys general, among others.
The extent to which each state considers particular actions or contractual relationships to constitute improper influence of professional judgment varies across the states and is subject to change and to evolving interpretations by state boards of medicine and state attorneys general, among others.
Accordingly, our results of operations will depend in substantial part 30 on our ability to deliver a successful experience for clients, as well as their members and patients, and persuade our clients to maintain and grow their relationship with us over time.
Accordingly, our results of operations will depend in substantial part on our ability to deliver a successful experience for clients, as well as their members and patients, and persuade our clients to maintain and grow their relationship with us over time.
We are at risk of a cyber-attack involving a vendor or other third party, which could result in a breakdown of such third party’s data protection processes or the cyber-attackers gaining access to our information systems or data through the third party.
We are at risk of a cyber-attack involving a vendor or other third party, which could result in a breakdown of such third party’s data 48 protection processes or the cyber-attackers gaining access to our information systems or data through the third party.
The ownership of a corporation’s stock for U.S. federal income tax purposes is generally based on the substance of a transaction, rather than the 39 ownership of legal title, based on a determination as to which entity has the benefits and burdens of the ownership of a corporation’s stock.
The ownership of a corporation’s stock for U.S. federal income tax purposes is generally based on the substance of a transaction, rather than the ownership of legal title, based on a determination as to which entity has the benefits and burdens of the ownership of a corporation’s stock.
These changes exclude companies with multiple classes of shares of common stock from being added to these indices. In addition, several stockholder advisory firms have announced their opposition to the use of dual or multiple class structures.
These changes exclude companies with multiple classes of shares of common stock from being added to these 49 indices. In addition, several stockholder advisory firms have announced their opposition to the use of dual or multiple class structures.
In addition, we have invested significant resources in research and development to enhance our existing solution and introduce new high-quality digital care products and services, such as our Converge platform, and intend to continue to invest resources to enhance our existing solution and introduce new products and services.
In addition, we have invested significant resources in research and development to enhance our existing solution and introduce new high-quality digital care products and services, such as our Amwell Converge ™ platform, and intend to continue to invest resources to enhance our existing solution and introduce new products and services.
Failure to comply with these laws and other laws can result in civil and criminal penalties such as fines, damages, overpayment recoupment, loss of enrollment status and exclusion from the Medicare and Medicaid programs.
Failure to comply with these laws and other laws can result in civil and criminal penalties such as fines, damages, overpayment recoupment, loss of enrollment status and 45 exclusion from the Medicare and Medicaid programs.
If our clients, or their members or patients, do not 24 perceive the benefits of our services, or if our services are not competitive, then our market may not develop at all, or it may develop more slowly than we expect.
If our clients, or their members or patients, do not perceive the benefits of our services, or if our services are not competitive, then our market may not develop at all, or it may develop more slowly than we expect.
In addition to remediating newly identified vulnerabilities, previously identified vulnerabilities must also be continuously addressed. Accordingly, we are at risk that cyber-attackers exploit these known vulnerabilities before they have 34 been addressed.
In addition to remediating newly identified vulnerabilities, previously identified vulnerabilities must also be continuously addressed. Accordingly, we are at risk that cyber-attackers exploit these known vulnerabilities before they have been addressed.
Any future such litigation against us could be costly and time-consuming to defend. We also publish statements to our clients and clients that describe how we handle and protect personal information.
Any future such litigation against us could be costly and time-consuming to defend. 46 We also publish statements to our clients and clients that describe how we handle and protect personal information.
Based on our analysis of changes in the ownership of our stock through December 31, 2023, we do not believe that any such changes prior to such date resulted in significant limitations under Section 382 of the Code on our ability to utilize NOL and credit carryforwards generated prior to that date.
Based on our analysis of changes in the ownership of our stock through December 31, 2024, we do not believe that any such changes prior to such date resulted in significant limitations under Section 382 of the Code on our ability to utilize NOL and credit carryforwards generated prior to that date.
In addition, as we expand internationally, we face the challenge of recruiting, integrating, educating, managing, retaining and developing a more culturally diverse workforce. Competition is intense for qualified professionals. We may not be successful in continuing to attract and retain qualified personnel.
In addition, as we expand internationally, we face the challenge of recruiting, integrating, educating, managing, retaining and developing a more culturally varied workforce. Competition is intense for qualified professionals. We may not be successful in continuing to attract and retain qualified personnel.
In addition, any such health epidemics, 27 pandemics and other public health emergencies could heighten many of the other risks identified elsewhere in this “Risk Factors” section. Our senior management team and diverse workforce are crucial for executing our business strategy.
In addition, any such health epidemics, pandemics and other public health emergencies could heighten many of the other risks identified elsewhere in this “Risk Factors” section. Our senior management team and workforce are crucial for executing our business strategy.
Our future capital requirements may be significantly different from our current estimates and will depend on many factors, including our growth rate, subscription renewal activity, the timing and extent of spending to support development efforts, the expansion of sales and marketing activities, the introduction of new or enhanced services and the continuing market acceptance of digital care.
Our future capital requirements may be significantly different from our current estimates and will depend on many factors, including our growth rate, subscription renewal activity, the timing and extent of spending to support development efforts, the expansion of sales and marketing activities, the introduction of new or enhanced services, the continuing market acceptance of digital care and the effectiveness of our cost-reduction efforts.
However, changes in the ownership of our stock after December 31, 2023, some of which are outside of our control, could result in an ownership change under Section 382 of the Code after such date, which could significantly limit 40 our ability to utilize our existing and future NOL and credit carryforwards arising at any time prior to such ownership change.
However, changes in the ownership of our stock after December 31, 2024, some of which are outside of our control, could result in an ownership change under Section 382 of the Code after such date, which could significantly limit our ability to utilize our existing and future NOL and credit carryforwards arising at any time prior to such ownership change.
At times, we may be required to quickly scale our capabilities, such as in response to unexpected shifts in demand for digital care, to implement our solution satisfactorily with respect to both large and demanding clients, who currently constitute the substantial majority of our client base.
We may not be able to quickly scale our capabilities when needed. At times, we may be required to quickly scale our capabilities, such as in response to unexpected shifts in demand for digital care, to implement our solution satisfactorily with respect to both large and demanding clients, who currently constitute the substantial majority of our client base.
However, although many of the executive orders have expired, several states have made permanent changes to their telehealth requirements, which in most cases will result in increased access to telehealth services. Most of the federal waivers have been extended through December 31, 2024.
However, although many of the executive orders have expired, several states have made permanent changes to their telehealth requirements, which in most cases will result in increased access to telehealth services. Most of the federal waivers have been extended through March 31, 2025.
The federal NOL carryforwards for years before 2018 begin to expire in 2026, the state NOL carryforwards began to expire in 2022 and federal research and development credit carryforwards begin to expire in 2027. Federal NOL carryforwards totaling $636.8 million generated in 2018 and after do not expire and can be carried forward indefinitely.
The federal NOL carryforwards for years before 2018 begin to expire in 2026, the state NOL carryforwards began to expire in 2022 and federal research and development credit carryforwards begin to expire in 2027. Federal NOL carryforwards totaling $757.4 million generated in 2018 and after do not expire and can be carried forward indefinitely.
For the years ended December 31, 2023, 2022 and 2021, our top ten clients by revenue accounted for 51%, 47% and 44% of our total 23 revenue, respectively. The loss of any of our key clients, or a failure of some of them to renew or expand their subscriptions, could have a significant impact on our revenue.
For the years ended December 31, 2024, 2023 and 2022, our top ten clients by revenue accounted for 58%, 51% and 47% of our total revenue, respectively. The loss of any of our key clients, or a failure of some of them to renew or expand their subscriptions, could have a significant impact on our revenue.
Risks Related to Our Financial Position We have a history of losses, which we expect to continue, and we may never achieve or sustain profitability. We have incurred significant losses in each period since our inception. We incurred net losses of $679.2 million, $272.1 million and $176.8 million for the years ended December 31, 2023, 2022 and 2021, respectively.
Risks Related to Our Financial Position We have a history of losses, which we expect to continue, and we may never achieve or sustain profitability. We have incurred significant losses in each period since our inception. We incurred net losses of $212.6 million, $679.2 million and $272.1 million for the years ended December 31, 2024, 2023 and 2022, respectively.
We rely on a limited number of clients for a substantial portion of our total revenue. For the years ended December 31, 2023, 2022 and 2021, our largest client, Elevance, accounted for 24%, 23% and 25% of our revenue, respectively.
We rely on a limited number of clients for a substantial portion of our total revenue. For the years ended December 31, 2024, 2023 and 2022, our largest client, Elevance, accounted for 27%, 24% and 23% of our revenue, respectively.
Our international operations are subject to particular risks in addition to those faced by our domestic operations, including: • the need to localize and adapt our solution for specific countries, including translation into foreign languages and associated expenses; • potential loss of proprietary information due to misappropriation or laws that may be less protective of our intellectual property rights than U.S. laws or that may not be adequately enforced; • requirements of foreign laws and other governmental controls, including cross-border compliance challenges related to the complexity of multiple, conflicting and changing governmental laws and regulations, including employment, healthcare, tax, privacy and data protection laws and regulations; • data privacy laws that require that client data be stored and processed in a designated territory; • new and different sources of competition and laws and business practices favoring local competitors; • local business and cultural factors that differ from our normal standards and practices, including business practices that we are prohibited from engaging in by the U.S.
In some countries we are required to, or choose to, operate with local business partners, which requires us to manage our partner relationships and may reduce our operational flexibility and ability to quickly respond to business challenges. 31 Our international operations are subject to particular risks in addition to those faced by our domestic operations, including: • the need to localize and adapt our solution for specific countries, including translation into foreign languages and associated expenses; • potential loss of proprietary information due to misappropriation or laws that may be less protective of our intellectual property rights than U.S. laws or that may not be adequately enforced; • requirements of foreign laws and other governmental controls, including cross-border compliance challenges related to the complexity of multiple, conflicting and changing governmental laws and regulations, including employment, healthcare, tax, privacy and data protection laws and regulations; • data privacy laws that require that client data be stored and processed in a designated territory; • new and different sources of competition and laws and business practices favoring local competitors; • local business and cultural factors that differ from our normal standards and practices, including business practices that we are prohibited from engaging in by the U.S.
As of December 31, 2023, we had an accumulated deficit of $1,757.8 million. These losses and accumulated deficit reflect the substantial investments we made to acquire new clients and develop our enterprise platform and software as a service.
As of December 31, 2024, we had an accumulated deficit of $1,965.9 million. These losses and accumulated deficit reflect the substantial investments we made to acquire new clients and develop our enterprise platform and software as a service.
In the year ended December 31, 2023, we incurred goodwill impairment charges of $436.5 million and, if in the future there is a sustained decline in our stock price, adverse changes in our projected cash flows, and/or changes in key assumptions, including but not limited to lower revenue growth, lower operating margin, and/or a lower terminal growth rate, we may be required conduct additional impairment testing of our other intangibles and/or long-lived assets and subsequently record additional non-cash impairment charge.
If in the future there is a sustained decline in our stock price, adverse changes in our projected cash flows, and/or changes in key assumptions, including but not limited to lower revenue growth, lower operating margin, and/or a lower terminal growth rate, we may be required conduct additional impairment testing of our other intangibles and/or long-lived assets and subsequently record additional non-cash impairment charge.
For the years ended December 31, 2023, 2022 and 2021, our net cash used in operating activities was $148.3 million, $192.3 million and $141.5 million respectively. As of December 31, 2023, we had $372.0 million of cash, cash equivalents and short-term investments, which are held for working capital purposes.
For the years ended December 31, 2024, 2023 and 2022, our net cash used in operating activities was $127.3 million, $148.3 million and $192.3 million respectively. As of December 31, 2024, we had $228.3 million of cash, cash equivalents and short-term investments, which are held for working capital purposes.
Sales and use and similar tax laws and rates vary greatly from state to state. For 2023 we filed sales and use tax in 46 states.
Sales and use and similar tax laws and rates vary greatly from state to state. For 2024, we filed sales and use tax in 47 states.
This could materially and adversely impact our business, financial condition and operating results. 33 If our or our vendors’ security measures fail or are breached and unauthorized access to a client’s data or information systems is obtained, our services may be perceived as insecure, we may incur significant liabilities, our reputation may be harmed, and we could lose sales and clients.
If our or our vendors’ security measures fail or are breached and unauthorized access to a client’s data or information systems is obtained, our services may be perceived as insecure, we may incur significant liabilities, our reputation may be harmed, and we could lose sales and clients.
While the digital care market is in an early stage of development, it is competitive and we expect it to attract increased competition, which could make it difficult for us to succeed.
The digital care market is competitive and we expect it to attract increased competition, which could make it difficult for us to succeed.
If we were not treated as the beneficial owner of the stock of the PCs, and were not entitled to include the PCs in our U.S. federal consolidated income tax return or a state unitary or similar tax return, this could have a material adverse effect on our cash position, tax liabilities, results of operations and financial condition.
If we were not treated as the beneficial owner of the stock of the PCs, and were not entitled to include the PCs in our U.S. federal consolidated income tax return or a state unitary or similar tax return, this could have a material adverse effect on our cash position, tax liabilities, results of operations and financial condition. 39 Certain U.S. state and local tax authorities may assert that we have a nexus with such states or localities and may seek to impose state and local income taxes on our income allocated to such state and localities.
These acquisitions may result in significant financial losses if the intended objectives of the transactions are not achieved. 41 We may enter into collaborations, in-licensing arrangements, joint ventures, strategic alliances or partnerships with third-parties that may not result in the development of commercially viable solutions or the generation of significant future revenues.
We may enter into collaborations, in-licensing arrangements, joint ventures, strategic alliances or partnerships with third-parties that may not result in the development of commercially viable solutions or the generation of significant future revenues.
As part of our business, we may deal with governments and state-owned business enterprises, the employees and representatives of which may be considered public officials for purposes of the FCPA. 42 We also are subject to the jurisdiction of various governments and regulatory agencies around the world, which may bring our personnel and agents into contact with public officials responsible for issuing or renewing permits, licenses or approvals or for enforcing other governmental regulations.
We also are subject to the jurisdiction of various governments and regulatory agencies around the world, which may bring our personnel and agents into contact with public officials responsible for issuing or renewing permits, licenses or approvals or for enforcing other governmental regulations.
We have offices in the United States, Ireland and Israel and clients in Israel and throughout Europe and Australia. Additionally, certain international geopolitical conflicts, such as between Russia and Ukraine and Israel-Hamas, may create additional risks for our business.
We have offices in the United States, Ireland and Israel and clients in Israel and throughout Europe and Australia. Additionally, certain international geopolitical conflicts, such as between Russia and Ukraine and Israel-Hamas, may create additional risks for our business. For example, we have certain employees, including our CEO, as well as engineering contractors who are located in these regions.
Though we have implemented an anti-corruption policy as well as formal training and monitoring programs, we cannot assure compliance by our employees or representatives for which we may be held responsible, and any such violation could materially adversely affect our reputation, business, financial condition and results of operations.
Though we have implemented an anti-corruption policy as well as formal training and monitoring programs, we cannot assure compliance by our employees or representatives for which we may be held responsible, and any such violation could materially adversely affect our reputation, business, financial condition and results of operations. 42 Our business could be adversely affected by legal challenges to our business model or by actions restricting our ability to provide the full range of our services in certain jurisdictions.
As of December 31, 2023, the Company had 32,945,952 shares of Class A common stock reserved for issuance upon conversion of Class B and Class C common stock.
As of December 31, 2024, the Company had 1,647,295 shares of Class A common stock reserved for issuance upon conversion of Class B and Class C common stock.
The scope and enforcement of each of these laws is uncertain and subject to rapid change in the current environment of healthcare reform. For example, because of increasing concerns about health information privacy, through guidance documents, some government agencies are taking a newly expansive view of the scope of information subject to the laws and regulations that they enforce.
For example, because of increasing concerns about health information privacy, through guidance documents, some government agencies are taking a 47 newly expansive view of the scope of information subject to the laws and regulations that they enforce.
Such risks include, but are not limited to, adverse macroeconomic conditions; increased exposure to cyber-attacks; risks to the contractors that we use in the region; constraints or disruption in the capital markets and our sources of liquidity; and a potential inability to service certain contractual obligations if our contractors in the region are otherwise unable to perform. 31 Our international operations require us to overcome logistical and other challenges based on differing languages, cultures, legal and regulatory schemes and time zones.
Such risks include, but are not limited to, adverse macroeconomic conditions; increased exposure to cyber-attacks; risks to the contractors that we use in the region; constraints or disruption in the capital markets and our sources of liquidity; and a potential inability to service certain contractual obligations if our contractors in the region are otherwise unable to perform.
Even if we are successful in identifying suitable acquisitions or investments, we may be unable to complete them due to, among other things, an inability to obtain in the anticipated timeframe, or at all, any regulatory approvals required to complete proposed acquisitions and other strategic transactions.
Even if we are successful in identifying suitable acquisitions or investments, we may be unable to complete them due to, among other things, an inability to obtain in the anticipated timeframe, or at all, any regulatory approvals required to complete proposed acquisitions and other strategic transactions. 40 If we acquire additional businesses, we may not be able to integrate the acquired personnel, operations and technologies successfully, or effectively manage the combined business following the acquisition.
Any such failure or event could adversely affect our relationships with our clients and damage our reputation.
Any such failure or event could adversely affect our relationships with our clients and damage our reputation. This could materially and adversely impact our business, financial condition and operating results.
If one or more of these analysts cease coverage of us or fail to publish reports on us regularly, we could lose visibility in the financial markets, which in turn could cause our stock price or trading volume to decline. 52 Because we do not anticipate paying any cash dividends on our capital stock in the foreseeable future, capital appreciation will be your sole source of gain, if any.
If one or more of these analysts cease coverage of us or fail to publish reports on us regularly, we could lose visibility in the financial markets, which in turn could cause our stock price or trading volume to decline.
We may not grow at the rates we historically have achieved or at all, even if our key metrics may indicate growth. We have experienced significant growth in the last five years. Future revenues may not grow at these same rates or may decline.
We may not grow at the rates we historically have achieved or at all, even if our key metrics may indicate growth.
For example, we have certain employees, including one of our Co-CEOs, as well as engineering contractors who are located in these regions. The conflicts in those regions and our exposure to it may heighten many other risks disclosed in this “Risk Factors” section, any of which could materially and adversely affect our business and results of operations.
The conflicts in those regions and our exposure to it may heighten many other risks disclosed in this “Risk Factors” section, any of which could materially and adversely affect our business and results of operations.
A material change in our relationship with AMG, whether resulting from a dispute among the entities, a change in government regulation, or the loss of these affiliations, could impair our ability to provide services to our consumers and could have a material adverse effect on our business, financial condition and results of operations.
A material change in our relationship with AMG, whether resulting from a dispute among the entities, a change in government regulation, or the loss of these affiliations, could impair our ability to provide services to our consumers and could have a material adverse effect on our business, financial condition and results of operations. 43 In addition, the arrangement in which we have entered to comply with state corporate practice of medicine doctrines could subject us to additional scrutiny by federal and state regulatory bodies regarding federal and state fraud and abuse laws.
However, the validity of the DPF is likely to be challenged before the CJEU. Because of the breadth of these laws and the narrowness of their exceptions and safe harbors, it is possible that our business activities can be subject to challenge under one or more of such laws.
Because of the breadth of these laws and the narrowness of their exceptions and safe harbors, it is possible that our business activities can be subject to challenge under one or more of such laws. The scope and enforcement of each of these laws is uncertain and subject to rapid change in the current environment of healthcare reform.
As of December 31, 2023, we had approximately $866.0 million of federal NOL carryforwards, $41.8 million of tax effected state NOL carryforwards, $1.6 million and $0.1 of federal and state research and development credit carryforwards, respectively.
As of December 31, 2024, we had approximately $986.0 million of federal NOL carryforwards, $45.7 million of tax effected state NOL carryforwards, $12.9 million and $3.0 of federal and state research and development credit carryforwards, respectively.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeItem 1C. Cybersecurity. Cybersecurity risk management is an integral part of our enterprise risk management program. Our cybersecurity program is designed to align with industry best practices and provide a framework for handling cybersecurity threats and incidents, including threats and incidents associated with the use of services provided by third-party service providers.
Biggest changeOur cybersecurity program is designed to align with industry best practices and provide a framework for handling cybersecurity threats and incidents, including threats and incidents associated with the use of services provided by third-party service providers. 52 Our Board has overall oversight responsibility for our risk management and is briefed periodically on cybersecurity risk management and any material cybersecurity incidents by o ur Chief Information Officer, or CIO, and General Counsel.
For more information about these risks, please see “Risk Factors – Risks Related to Our Business and Industry” and “Risk Factors – Risks Related to Government Regulation" in this annual report on Form 10-K. 53
For more information about these risks, please see “Risk Factors – Risks Related to Our Business and Industry” and “Risk Factors – Risks Related to Government Regulation" in this annual report on Form 10-K.
In 2023, we did not identify any cybersecurity threats that have materially affected or are reasonably likely to materially affect our business strategy, results of operations, or financial condition. However, despite our efforts, we cannot eliminate all risks from cybersecurity threats, or provide assurances that we have not experienced an undetected cybersecurity incident.
In 2024, we did not identify any cybersecurity threats that have materially affected or are reasonably likely to materially affect our business strategy, results of operations or financial condition. Despite our efforts, we cannot eliminate all risks from cybersecurity threats, or provide assurances that we have not experienced an undetected cybersecurity incident.
Personnel with significant security responsibilities receive specialized education and training on their roles and responsibilities prior to being granted access to systems and resources. The pre-employment process for these roles is designed to ensure that security responsibilities are specifically defined. Our CIO has over 25 years of technology leadership experience.
Our CIO and dedicated personnel are certified and experienced information systems security professionals and information security managers. Personnel with significant security responsibilities receive specialized education and training on their roles and responsibilities prior to being granted access to systems and resources. The pre-employment process for these roles is designed to ensure that security responsibilities are specifically defined.
Specifically, our Security Steering Committee ("SSC"), a cross-functional team of employees chaired by our CIO, is responsible for providing strategic guidance and execution oversight to Amwell’s privacy, risk and security programs and policies. Management has instituted an Information Security Management System ("ISMS").
Specifically, our Security Steering Committee ("SSC"), a cross-functional team of employees chaired by our CIO, is responsible for providing strategic guidance and oversight to Amwell’s privacy, risk and security programs and policies. Management has instituted an Information Security Management System ("ISMS"). The ISMS establishes risk-based safeguards that are designed to adequately protect the Company and information acquired through business operations.
The ISMS establishes risk-based safeguards that are designed to adequately protect the Company and information acquired through business operations. Amwell maintains its ISMS in accordance with ISO 27001 standards. Amwell is audited annually by a third-party assessment firm that determines the effectiveness of the procedures and processes of its ISMS.
Amwell maintains its ISMS in accordance with ISO 27001 standards. Amwell is audited annually by a third-party assessment firm that determines the effectiveness of the procedures and processes of its ISMS. Amwell also self-assesses the performance and effectiveness of the ISMS through monitoring, measurement, analysis, and evaluation of controls and control objectives.
Amwell also self-assesses the performance and effectiveness of the ISMS through monitoring, measurement, analysis, and evaluation of controls and control objectives. The SSC ensures the workforce complies with the ISMS policies, procedures and controls through many channels, including annual review of audit and risk assessment results, multifactor authentication, annual employee training and company-wide communications.
The SSC ensures the workforce complies with the ISMS policies, procedures and controls through many channels, including annual review of audit and risk assessment results, multifactor authentication, annual employee training and company-wide communications. Our team of cybersecurity focused employees, under the direction of our CIO, is responsible for assessing our cybersecurity risk and detecting, mitigating and remediating cybersecurity incidents.
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Our Board has overall oversight responsibility for our risk management and is briefed periodically on cybersecurity risk management and any material cybersecurity incidents by our Chief Information Officer, or CIO, and General Counsel.
Added
Item 1C. Cybersecurity. Cybersecurity risk management is an integral part of our enterprise risk management program.
Removed
Our team of cybersecurity focused employees, under the direction of our CIO, is responsible for assessing our cybersecurity risk and detecting, mitigating and remediating cybersecurity incidents. Our CIO and dedicated personnel are certified and experienced information systems security professionals and information security managers.
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Our CIO has over 15 years of technology leadership experience.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeWe have instituted a remote work policy which has allowed us to reduce our office footprint, including approximately 50% of our corporate headquarters footprint, reducing the climate impact associated with our team members’ commuting. We will continue to assess the need for space taking into consideration the change in workplace dynamic driven by the COVID-19 pandemic.
Biggest changeWe have instituted a remote work policy which has allowed us to reduce our office footprint, including approximately 50% of our corporate headquarters footprint, reducing the climate impact associated with our team members’ commuting.
We believe that our facilities are adequate to meet our needs for the immediate future, and that, should it be needed, suitable additional space will be available to accommodate any such expansion.
We believe that our facilities are adequate to meet our needs for the immediate future, and that, should it be needed, suitable additional space will be available to accommodate any such expansion. 53
Item 2. Pro perties. Our principal executive office is located in Boston, Massachusetts and is a LEED certified building. We also have an office in Ramat Gan, Israel, Tysons Corner, Virginia and Dublin, Ireland. All of our office locations are leased. We also maintain hardware inventory in facilities based in San Diego, California.
Item 2. Pro perties. Our principal executive office is located in Boston, Massachusetts and is a LEED certified building. We also have offices in Ramat Gan, Israel, Tysons Corner, Virginia, Dublin, Ireland and Bogotá and Medellin, Colombi. All of our office locations are leased. We also maintain hardware inventory in facilities based in San Diego, California.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changePurchase of Equity Securities The Company had no purchases of its common stock for any month during the fourth quarter of the fiscal year covered by this report. 55 Performance Graph The following performance graph shall not be deemed “soliciting material” or to be “filed” with the SEC for purposes of Section 18 of the Exchange Act, or otherwise subject to the liabilities under that Section, and shall not be deemed to be incorporated by reference into any filing of American Well Corporation under the Securities Act or the Exchange Act.
Biggest changePeriod (a) Total number of shares (or units) purchased* (b) Average price paid per share (or unit)* (c) Total number of shares (or units) purchased as part of publicly announced plans or programs (d) Maximum number (or approximate dollar value) of shares (or units) that may yet be purchased under the plans or programs October 1 to October 31 143 $ 9.48 — — November 1 to November 30 13 $ 9.16 — — December 1 to December 31 26 $ 9.57 — — Total 182 $ 9.47 — — * Shares withheld to cover tax withholding obligations under the net settlement provision upon vesting of restricted stock units and exercising of options. 55 Performance Graph The following performance graph shall not be deemed “soliciting material” or to be “filed” with the SEC for purposes of Section 18 of the Exchange Act, or otherwise subject to the liabilities under that Section, and shall not be deemed to be incorporated by reference into any filing of American Well Corporation under the Securities Act or the Exchange Act.
Securities Authorized for Issuance under Equity Compensation Plans The information required hereunder will be included in our Definitive Proxy Statement to be filed with the SEC with respect to our 2024 Annual Meeting of Stockholders and is incorporated herein by reference.
Securities Authorized for Issuance under Equity Compensation Plans The information required hereunder will be included in our Definitive Proxy Statement to be filed with the SEC with respect to our 2025 Annual Meeting of Stockholders and is incorporated herein by reference from Part III. "Item 12.
Holders On February 2, 2024, there were 170 stockholders of record of our Class A common stock, two stockholders of record of our Class B common stock and one stockholder of record of our Class C common stock.
Holders On January 31, 2025, there were 153 stockholders of record of our Class A common stock, two stockholders of record of our Class B common stock and one stockholder of record of our Class C common stock.
Removed
Recent Sales of Unregistered Securities There were no sales of unregistered equity securities during the quarter ended December 31, 2023.
Added
Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters." Recent Sales of Unregistered Securities There were no sales of unregistered equity securities during the quarter ended December 31, 2024. Purchase of Equity Securities The following table provides information about the Company’s purchases of its common stock for each month during this quarterly period covered by this report.
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Fiscal year ended December 31 Item 6. Reserved 56

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Biggest changeConsolidated Results of Operations The following table sets forth our summarized consolidated statement of operations data for the years ended December 31, 2023, 2022 and 2021 and the dollar and percentage change between the respective periods: Years Ended December 31, Fiscal Year 2023 to Fiscal Year 2022 Fiscal Year 2022 to Fiscal Year 2021 (in thousands) 2023 2022 2021 Change % Change % Revenue $ 259,047 $ 277,190 $ 252,789 $ (18,143 ) -7 % $ 24,401 10 % Costs and operating expenses: Costs of revenue, excluding depreciation and amortization of intangible assets 164,287 160,422 148,474 3,865 2 % 11,948 8 % Research and development 105,827 138,487 106,594 (32,660 ) (24 )% 31,893 30 % Sales and marketing 86,460 81,628 66,154 4,832 6 % 15,474 23 % General and administrative 126,645 146,353 94,624 (19,708 ) (13 )% 51,729 55 % Depreciation and amortization expense 31,492 26,153 16,089 5,339 20 % 10,064 63 % Goodwill impairment 436,479 — — 436,479 100 % — 100 % Total costs and operating expenses 951,190 553,043 431,935 398,147 72 % 121,108 28 % Loss from operations (692,143 ) (275,853 ) (179,146 ) (416,290 ) 151 % (96,707 ) 54 % Interest income and other income (expense), net 19,422 6,123 120 13,299 217 % 6,003 5,003 % Loss before benefit (expense) from income taxes and loss from equity method investment (672,721 ) (269,730 ) (179,026 ) (402,991 ) 149 % (90,704 ) 51 % (Expense) benefit from income taxes (3,860 ) (64 ) 5,376 (3,796 ) 5,931 % (5,440 ) (101 )% Loss from equity method investment (2,590 ) (2,278 ) (3,132 ) (312 ) 14 % 854 (27 )% Net loss (679,171 ) (272,072 ) (176,782 ) (407,099 ) 150 % (95,290 ) 54 % Net loss attributable to non-controlling interest (4,007 ) (1,643 ) (448 ) (2,364 ) 144 % (1,195 ) 267 % Net loss attributable to American Well Corporation $ (675,164 ) $ (270,429 ) $ (176,334 ) $ (404,735 ) 150 % $ (94,095 ) 53 % Revenue For the year ended December 31, 2023, subscription revenue declined $8.6 million due to customer churn during re-platforming, partially offset by growth in our existing strategic clients.
Biggest changeConsolidated Results of Operations The following table sets forth our summarized consolidated statement of operations data for the years ended December 31, 2024, 2023 and 2022 and the dollar and percentage change between the respective periods: Years Ended December 31, Fiscal Year 2024 to Fiscal Year 2023 Fiscal Year 2023 to Fiscal Year 2022 (in thousands) 2024 2023 2022 Change % Change % Revenue $ 254,364 $ 259,047 $ 277,190 $ (4,683 ) (2 )% $ (18,143 ) (7 )% Costs and operating expenses: Costs of revenue, excluding depreciation and amortization of intangible assets 155,412 164,287 160,422 (8,875 ) (5 )% 3,865 2 % Research and development 86,065 105,827 138,487 (19,762 ) (19 )% (32,660 ) (24 )% Sales and marketing 76,272 86,460 81,628 (10,188 ) (12 )% 4,832 6 % General and administrative 121,174 126,645 146,353 (5,471 ) (4 )% (19,708 ) (13 )% Depreciation and amortization expense 32,975 31,492 26,153 1,483 5 % 5,339 20 % Goodwill impairment — 436,479 — (436,479 ) 100 % 436,479 100 % Total costs and operating expenses 471,898 951,190 553,043 (479,292 ) (50 )% 398,147 72 % Loss from operations (217,534 ) (692,143 ) (275,853 ) 474,609 (69 )% (416,290 ) 151 % Interest income and other income (expense), net 10,757 19,422 6,123 (8,665 ) (45 )% 13,299 217 % Loss before expense from income taxes and loss from equity method investment (206,777 ) (672,721 ) (269,730 ) 465,944 (69 )% (402,991 ) 149 % Expense from income taxes (2,751 ) (3,860 ) (64 ) 1,109 (29 )% (3,796 ) 5,931 % Loss from equity method investment (3,110 ) (2,590 ) (2,278 ) (520 ) 20 % (312 ) 14 % Net loss (212,638 ) (679,171 ) (272,072 ) 466,533 (69 )% (407,099 ) 150 % Net loss attributable to non-controlling interest (4,495 ) (4,007 ) (1,643 ) (488 ) 12 % (2,364 ) 144 % Net loss attributable to American Well Corporation $ (208,143 ) $ (675,164 ) $ (270,429 ) $ 467,021 (69 )% $ (404,735 ) 150 % Revenue For the year ended December 31, 2024, subscription revenue increased $3.2 million due to growth in our strategic clients.
A typical health system client has many hospitals within its system. The average number of health system clients is calculated by averaging the number of such clients under contract at the beginning and end of each fiscal year. The decline in number of health system client is due to consolidation in the market as well as churn experienced with re-platforming.
A typical health system client has many hospitals within its system. The average number of health system clients is calculated by averaging the number of such clients under contract at the beginning and end of each fiscal year. The decline in number of health system clients is due to consolidation in the market as well as churn experienced with re-platforming.
We expect that our future revenues will be driven by the growing adoption of digital care and our ability to maintain and grow market share within that market. We continue to experience strong digital care adoption and usage of our enterprise platform and software as a service.
We expect that our future revenues will be driven by the growing adoption of digital care and our ability to maintain and grow market share within that market. We continue to experience strong adoption and usage of our enterprise platform and software as a service.
Revenue performance is reflective of the strong foundation that has been built, focused around health plans, health systems, our provider network. We generate revenues from the use of our enterprise platform and software as a service in the form of recurring subscription fees for use, and related services and Carepoint sales.
Revenue performance is reflective of the strong foundation that has been built, focused around health plans, health systems, and our provider network. We generate revenues from the use of our enterprise platform and software as a service in the form of recurring subscription fees for use, and related services and Carepoint sales.
Second, our health systems agreements typically include a certain number of visits conducted by their own providers annually and provide that as certain volume thresholds are exceeded, its annual license fees will rise to reflect this growing value. Third, to the extent that clients utilize provider services from AMG, Amwell derives revenue from clinical fees.
Second, our health systems agreements typically include a certain number of visits conducted by their own providers annually and provide that as certain volume thresholds are exceeded, its annual license fees will rise 58 to reflect this growing value. Third, to the extent that clients utilize provider services from AMG, Amwell derives revenue from clinical fees.
Treasury zero-coupon issues with maturities that are commensurate with the expected term. • Dividend Yield —The dividend yield assumption is zero, as we have no history of, or plans to make, dividend payments. The fair value of the PSUs is estimated using a Monte-Carlo valuation simulation.
Treasury zero-coupon issues with maturities that are commensurate with the expected term. • Dividend Yield —The dividend yield assumption is zero, as we have no history of, or plans to make, dividend payments. 69 The fair value of the PSUs is estimated using a Monte-Carlo valuation simulation.
We believe that this non-GAAP financial measure, when taken together with 59 the corresponding GAAP financial measures, provides meaningful supplemental information regarding our performance by excluding certain items that may not be indicative of our business, results of operations or outlook.
We believe that this non-GAAP financial measure, when taken together with the corresponding GAAP financial measures, provides meaningful supplemental information regarding our performance by excluding certain items that may not be indicative of our business, results of operations or outlook.
The Company does not have a controlling financial interest in CCAW, JV LLC, but it does have the ability to exercise significant influence over the operating and 65 financial policies of CCAW, JV LLC. Therefore, the Company accounts for its investments in CCAW, JV LLC using the equity method of accounting.
The Company does not have a controlling financial interest in CCAW, JV LLC, but it does have the ability to exercise significant influence over the operating and financial policies of CCAW, JV LLC. Therefore, the Company accounts for its investments in CCAW, JV LLC using the equity method of accounting.
General and Administrative Expenses For the year ended December 31, 2023, the decrease in general and administrative expense was driven by a decrease of $6.0 million in legal costs mainly due to the Teladoc litigation settlement in the second quarter of 2022.
For the year ended December 31, 2023, the decrease in general and administrative expense was driven by a decrease of $6.0 million in legal costs mainly due to the Teladoc litigation settlement in the second quarter of 2022.
Operating Expenses Operating expenses consist of research and development, sales and marketing, and general and administrative expenses. Research and Development Expenses Research and development expenses include personnel and related expenses for software and hardware engineering, information technology infrastructure, security and compliance and product development (inclusive of stock-based compensation for our research and development employees).
Operating Expenses Operating expenses consist of research and development, sales and marketing, and general and administrative expenses. 61 Research and Development Expenses Research and development expenses include personnel and related expenses for software and hardware engineering, information technology infrastructure, security and compliance and product development (inclusive of stock-based compensation for our research and development employees).
(4) Litigation expense relates to legal costs related to the Teladoc litigation which was dismissed pursuant to a confidential settlement between the parties in 2022. 60 Some of the limitations of adjusted EBITDA include (i) adjusted EBITDA does not properly reflect capital commitments to be paid in the future, and (ii) although depreciation and amortization are non-cash charges, the underlying assets may need to be replaced and adjusted EBITDA does not reflect these capital expenditures.
(3) Litigation expense relates to legal costs related to the Teladoc litigation which was dismissed pursuant to a confidential settlement between the parties in 2022. 60 Some of the limitations of adjusted EBITDA include (i) adjusted EBITDA does not properly reflect capital commitments to be paid in the future, and (ii) although depreciation and amortization are non-cash charges, the underlying assets may need to be replaced and adjusted EBITDA does not reflect these capital expenditures.
While our aggregated number of health systems clients has declined during re-platforming, we have retained the majority of our historically significant clients and with the Converge platform have been able to strengthen and expand our strategic clients during the year. Visit revenue decreased $4.9 million due to a decline in visit volume and lower utilization in specialty care.
While our aggregated number of health systems clients declined during re-platforming, we have retained the majority of our historically significant clients and with the Amwell Converge ™ platform have been able to strengthen and expand our strategic clients during the year. Visit revenue decreased $4.9 million due to a decline in visit volume and lower utilization in specialty care.
The Company has no debt as of December 31, 2023 and expects to generate operating losses in future years. We believe that our existing cash and cash equivalents will be sufficient to meet our working capital and capital expenditure needs for at least the next 12 months from the issuance date of the financial statements.
The Company has no debt as of December 31, 2024 and expects to generate operating losses in future years. We believe that our existing cash and cash equivalents will be sufficient to meet our working capital and capital expenditure needs for at least the next 12 months from the issuance date of the financial statements.
Research and Development Expenses For the year ended December 31, 2023, the decrease in research and development expense was primarily driven by a decrease of $24.8 million in consulting services as spend related to the development of the Converge platform has declined (contributing to this decrease was $15.1 million capitalized as software development costs) as well as a decrease of $1.2 million in third party software costs.
For the year ended December 31, 2023, the decrease in research and development expense was primarily driven by a decrease of $24.8 million in consulting services as spend related to the development of the Amwell Converge ™ platform has declined (contributing to this decrease was $15.1 million capitalized as software development costs) as well as a decrease of $1.2 million in third party software costs.
A reconciliation is provided below for our non-GAAP financial measure to the most directly comparable financial measure stated in accordance with GAAP.
A reconciliation is provided below for our non-GAAP financial measure to the most directly comparable financial measure 59 stated in accordance with GAAP.
Interest Income and Other Income (Expense), net For the year ended December 31, 2023, interest income and other expenses consist primarily of interest income and gains from our cash equivalents and short-term investments, the increase in interest income is due to the increase in interest rates on investments held during the year (investments matured just prior to December 31, 2023).
For the year ended December 31, 2023, interest income and other expenses consist primarily of interest income and gains from our cash equivalents and short-term investments, the increase in interest income is due to the increase in interest rates on investments held during the year (investments matured just prior to December 31, 2023).
Digital Care Utilization Digital care utilization is a key driver of our business. A client’s overall utilization of its digital care platform provides an important measure of the value they derive. Digital care utilization drives our business in three important ways.
Digital Care Utilization Digital and hybrid care utilization is a key driver of our business. A client’s overall utilization of its digital care platform provides an important measure of the value they derive and drives our business in three important ways.
During the years ended December 31, 2023 and 2022, the Company recognized a loss of $2.6 million and $2.3 million as its proportionate share of the joint venture results of operations, respectively.
During the years ended December 31, 2024 and 2023, the Company recognized a loss of $3.1 million and $2.6 million as its proportionate share of the joint venture results of operations, respectively.
We had no such other items during the years ended December 31, 2023, 2022 and 2021.
We had no such other items during the years ended December 31, 2024, 2023 and 2022.
As of December 31, 2023, we powered the digital care programs of more than 50 health plans, which collectively represent more than 100 million covered lives, as well as approximately 115 of the nation’s largest health systems.
As of December 31, 2024, we powered the digital care programs of approximately 50 health plans, which collectively represent more than 80 million covered lives, as well as approximately 100 of the nation’s largest health systems.
Health Plans: Years Ended December 31, 2023 2022 2021 Average Number of Health Plan Clients 55 57 58 Total Health Plan Subscription Revenue $ 49.2 million $ 48.7 million $ 41.9 million Average Annual Contract Value $ 902 thousand $ 862 thousand $ 723 thousand Health Plan : A health plan is an enterprise platform client whose primary business case is managing the healthcare financial risk of its membership.
Health Plans: Years Ended December 31, 2024 2023 2022 Average Number of Health Plan Clients 52 55 57 Total Health Plan Subscription Revenue $ 49.9 million $ 49.2 million $ 48.7 million Average Annual Contract Value $ 963 thousand $ 902 thousand $ 862 thousand Health Plan : A health plan is an enterprise platform client whose primary business case is managing the healthcare financial risk of its membership.
(Expense) Benefit from Income Taxes Income tax expense was $3.9 million for the year ended December 31, 2023, compared to income tax expense of $0.1 million for the year ended December 31, 2022. The increase in the expense is primarily due to an increase in foreign tax expense.
The decrease in the expense is primarily due to an decrease in foreign tax expense. 65 Income tax expense was $3.9 million for the year ended December 31, 2023, compared to income tax expense of $0.1 million for the year ended December 31, 2022. The increase in the expense is primarily due to an increase in foreign tax expense.
If we are unable to raise additional capital when desired, our business, financial condition and results of operations would be adversely affected. Cash Used in Operating Activities For the year ended December 31, 2023, cash used in operating activities was $148.3 million. The primary driver of this use of cash was our net loss of $679.2 million.
If we are unable to raise additional capital when desired, our business, financial condition and results of operations would be adversely affected. Cash Used in Operating Activities For the year ended December 31, 2024, cash used in operating activities was $127.3 million. The primary driver of this use of cash was our net loss of $212.6 million.
We combine contracts entered into at or near the same time with the same client if we determine that the contracts are negotiated as a package with a single commercial objective; the amount of consideration to be paid in one contract depends on the price or performance of the other contract; or the services promised in the contracts are a single performance obligation. 68 In general, we satisfy the majority of our performance obligations over time as we transfer the promised services to our clients.
We combine contracts entered into at or near the same time with the same client if we determine that the contracts are negotiated as a 68 package with a single commercial objective; the amount of consideration to be paid in one contract depends on the price or performance of the other contract; or the services promised in the contracts are a single performance obligation.
We expect our sales and marketing expense to decrease as a percentage of our total revenue in future periods. Our sales and marketing expenses will fluctuate as a percentage of our total revenue from period to period due to the seasonality of our total revenue and the timing and extent of our advertising and marketing expenses.
We expect sales and marketing expense to decrease over the next year and then to remain flat in future periods. Our sales and marketing expenses will fluctuate as a percentage of our total revenue from period to period due to the seasonality of our total revenue and the timing and extent of our advertising and marketing expenses.
Due to a reduction in headcount employee related expenses decreased by $2.5 million and recruiting and new hire costs decrease $0.9 million.
Due to a reduction in headcount employee related expenses decreased by $2.5 million and recruiting and new hire costs decrease $0.9 million. There was also a decrease in insurance costs of $2.9 million.
We calculate adjusted EBITDA as net loss adjusted to exclude (i) interest income and other income, net, (ii) tax benefit and expense, (iii) depreciation and amortization, (iv) goodwill impairment, (v) stock-based compensation expense, (vi) severance, (vii) public offering expenses, (viii) acquisition-related expenses, capitalized software costs, (ix) capitalized software, (x) litigation expenses related to the defense of our patents in the patent infringement claim filed by Teladoc and (xi) other items affecting our results that we do not view as representative of our ongoing operations, including direct and incremental expenses associated with the COVID-19 pandemic.
We calculate adjusted EBITDA as net loss adjusted to exclude (i) interest income and other income, net, (ii) tax benefit and expense, (iii) depreciation and amortization, (iv) goodwill impairment, (v) stock-based compensation expense, (vi) severance and strategic transformation costs, (vii) capitalized software costs, (viii) litigation expenses related to the defense of our patents in the patent infringement claim filed by Teladoc and (ix) other items affecting our results that we do not view as representative of our ongoing operations.
Cash used in financing activities consisted of the payment of the Conversa integration earnout of $11.8 million, partially offset by $8.2 million of proceeds from the exercise of employee stock options and employee stock purchase plan. Cash provided by financing activities for the year ended December 31, 2021, was $5.8 million.
Cash used in financing activities consisted of the payment of the Conversa integration earnout of $11.8 million, partially offset by $8.2 million of proceeds from the exercise of employee stock options and employee stock purchase plan.
Liquidity and Capital Resources The following table presents a summary of our cash flow activity for the periods set forth below: Years December 31, 2023 2022 2021 Consolidated Statements of Cash Flows Data: Net cash used in operating activities $ (148,343 ) $ (192,323 ) $ (141,537 ) Net cash used in investing activities (19,168 ) (11,630 ) (59,633 ) Net cash provided by (used in) financing activities 2,147 (3,612 ) 5,754 Total $ (165,364 ) $ (207,565 ) $ (195,416 ) Sources of Financing Our principal sources of liquidity were cash, cash equivalents and short-term investments totaling $372.0 million as of December 31, 2023, which were held for a variety of growth initiatives and investments as well as working capital purposes.
Liquidity and Capital Resources The following table presents a summary of our cash flow activity for the periods set forth below: Years December 31, 2024 2023 2022 Consolidated Statements of Cash Flows Data: Net cash used in operating activities $ (127,338 ) $ (148,343 ) $ (192,323 ) Net cash used in investing activities (18,652 ) (19,168 ) (11,630 ) Net cash provided by (used in) financing activities 1,381 2,147 (3,612 ) Total $ (144,609 ) $ (165,364 ) $ (207,565 ) Sources of Financing Our principal sources of liquidity were cash and cash equivalents totaling $228.3 million as of December 31, 2024, which were held for a variety of growth initiatives and investments as well as working capital purposes.
Key Metrics and Factors Affecting Our Performance We monitor the following key metrics to help us evaluate our business, identify trends affecting our business, formulate business plans and make strategic decisions: Health Systems: Years Ended December 31, 2023 2022 2021 Average Number of Health System Clients 129 153 154 Total Health System Subscription Revenue $ 53.5 million $ 61.2 million $ 54.7 million Average Annual Contract Value $ 415 thousand $ 401 thousand $ 356 thousand Health System : A health system is an enterprise platform client whose primary business case is the delivery of care by its providers.
Streamlining our service offerings will enable us to focus our resources on the Converge platform, strategic customers, and our path to profitability. 57 Key Metrics and Factors Affecting Our Performance We monitor the following key metrics to help us evaluate our business, identify trends affecting our business, formulate business plans and make strategic decisions: Health Systems: Years Ended December 31, 2024 2023 2022 Average Number of Health System Clients 107 129 153 Total Health System Subscription Revenue $ 52.0 million $ 53.5 million $ 61.2 million Average Annual Contract Value $ 488 thousand $ 415 thousand $ 401 thousand Health System : A health system is an enterprise platform client whose primary business case is the delivery of care by its providers.
The increase in amortization was related to a full year of amortization related to the intangible assets acquired in the Acquisitions. Goodwill Impairment During the year ended December 31, 2023, the goodwill was impaired by $436.5 million (or $1.54 per basic and diluted share) as a result of sustained decreases in the Company's publicly quoted share price and market capitalization.
The increase in amortization was related to the amortization of the internally developed software intangible assets. Goodwill Impairment During the year ended December 31, 2023, the goodwill was fully impaired by $436.5 million as a result of sustained decreases in the Company's publicly quoted share price and market capitalization.
Obligations under contracts that we can cancel without a significant penalty are not included in the table above. 67 During the periods presented, we did not have, nor do we currently have, any relationships with unconsolidated entities or financial partnerships, such as entities often referred to as structured finance or special purpose entities, which would have been established for the purpose of facilitating off-balance sheet arrangements or other contractually narrow or limited purposes.
During the periods presented, we did not have, nor do we currently have, any relationships with unconsolidated entities or financial partnerships, such as entities often referred to as structured finance or special purpose entities, which would have been established for the purpose of facilitating off-balance sheet arrangements or other contractually narrow or limited purposes.
The net loss for the year was reflective of the investments made back into the Company (from both a personnel and technology perspective), partially offset by the overall growth of our business including an increase in new clients and expansion of business with existing clients.
The net loss was reflective of the investments made back into the Company (from a technology and infrastructure perspective), partially offset by the overall growth of our business including expansion of business with existing clients and the addition of new strategic agreements.
The net loss was partially offset by non-cash expenses of $107.8 million (primarily stock-based compensation of $67.7 million and depreciation and amortization of $26.2 million). 66 For the year ended December 31, 2021, cash used in operating activities was $141.5 million. The primary driver of this use of cash was our net loss of $176.8 million.
The net loss was partially offset by non-cash expenses of $107.8 million (primarily stock-based compensation of $67.7 million and depreciation and amortization of $26.2 million). Cash Used in Investing Activities Cash used in investing activities was $18.7 million for the year ended December 31, 2024.
Sales and Marketing Expenses For the year ended December 31, 2023, the increase in sales and marketing expense primarily consisted of $11.0 million in employee-related costs including severance, stock compensation expense (related to accelerated vesting on an executive grant), and headcount realignment.
These decreases were partially offset by $3.6 million in non-recurring consulting costs related to organizational strategy initiatives. For the year ended December 31, 2023, the increase in sales and marketing expense primarily consisted of $11.0 million in employee-related costs including severance, stock compensation expense (related to accelerated vesting on an executive grant), and headcount realignment.
Health System Subscription Revenue: Health System subscription revenue consists of all platform-related fees for a health system, including subscription licenses, fees related to software modules, and overage charges, and primarily represents the fee to access the enterprise platform over the contractual period.
Health System Subscription Revenue: Health System subscription revenue consists of all platform-related fees for a health system, including subscription licenses, fees related to software modules, and overage charges, and primarily represents the fee to access the enterprise platform over the contractual period. Subscription revenue may include immaterial amounts from non-health system clients whose business model acts similarly to those clients.
Deferred revenues consist of the unearned portion of billed fees for our enterprise platform and software as a service access fees and related services, which is subsequently recognized as revenue in accordance with our revenue recognition policy.
These evaluations require significant judgment around the proper identification of performance obligations, which could affect the timing and amount of revenue recognized. Deferred revenues consist of the unearned portion of billed fees for our enterprise platform and software as a service access fees and related services, which is subsequently recognized as revenue in accordance with our revenue recognition policy.
Since inception, we have powered more than 27.2 million virtual care visits for our clients, including more than 6.3 million in the year ended December 31, 2023.
Since inception, we have powered more than 33.1 million virtual care visits for our clients, including more than 5.9 million in the year ended December 31, 2024.
Our enterprise platform and software as a service solutions enable hybrid care delivery by offering our clients products to help weave digital care across all care settings. We bring technology and services that facilitate new models of care, strategic partnerships, consistent execution and better outcomes.
We offer our clients products to help weave digital care across all care settings. We bring technology and services that facilitate new models of care, strategic partnerships, consistent execution and better outcomes.
The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income. Management makes estimates and judgments about future taxable income based on assumptions that are consistent with our plans and estimates.
Deferred tax assets are reduced by a valuation allowance to the extent management believes it is not more likely than not to be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income. Management makes estimates and judgments about future taxable income based on assumptions that are consistent with our plans and estimates.
The increase in amortization was related to the amortization of the internally developed software intangible assets. Depreciation expense remained consistent for the year ended December 31, 2022. Amortization expense increased by $10.7 million for the year ended December 31, 2022.
Amortization expense increased by $1.8 million for the year ended December 31, 2024. The increase in amortization was related to the amortization of the internally developed software intangible assets that had a full year of amortization. Depreciation expense remained consistent for the year ended December 31, 2023. Amortization expense increased by $6.2 million for the year ended December 31, 2023.
The Company estimates the amount of revenue it expects to recognize during the twelve-month period following the financial statement date which is recorded as current deferred revenue and the remaining portion is recorded as noncurrent. Business Combinations The Company accounts for business combinations using the acquisition method of accounting.
The Company estimates the amount of revenue it expects to recognize during the twelve-month period following the financial statement date which is recorded as current deferred revenue and the remaining portion is recorded as noncurrent. Intangible Assets Amortization of acquired intangible assets is the result of historical acquisitions.
Scheduled visits were 4.1 million and 4.6 million during the years ended December 31, 2023 and 2022, respectively. AMG providers accounted for 25% and 25% of total visits performed on our enterprise platform during the years ended December 31, 2023 and 2022, respectively.
In the year ended December 31, 2023, our clients completed a total of 6.3 million visits on our enterprise platform, while in the year ended December 31, 2024, 5.9 million visits were completed. AMG providers accounted for 25% and 25% of total visits performed on our enterprise platform during the years ended December 31, 2024 and 2023, respectively.
In addition, we believe continued investments in platform modules and clinical programs will allow us to further penetrate our products and services into our existing client relationships and new opportunities.
Invest in Growth We expect to continue to focus on long-term revenue growth through investments in technology development and sales and marketing efforts. In addition, we believe continued investments in platform modules and clinical programs will allow us to further penetrate our products and services into our existing client relationships and new opportunities.
The significant estimates used in fair value methodology, which are based on Level 3 inputs, include the Company's expectations for future operations and projected cash flows, including revenue, gross margin and operating expenses. Reasonably possible changes in those assumptions could result in non-cash impairment charges in the future.
To test intangible assets for impairment the Company performs an undiscounted cash flow analysis to establish fair value. The significant estimates used in fair value methodology, which are based on Level 3 inputs, include the Company's expectations for future operations and projected cash flows, including revenue, gross margin and operating expenses.
Contractual Obligations The following summarizes our contractual obligations as of December 31, 2023: Payment Due by Period Total Less than 1 Year 1 to 3 Years 4 to 5 Years More than 5 Years Operating Leases $ 12,006 $ 3,698 $ 8,308 $ — $ — Purchase Obligations $ 49,850 15,326 34,524 — — Total $ 61,856 $ 19,024 $ 42,832 $ — $ — Our existing office and hosting facilities lease agreements provide us with the option to renew and generally provide for rental payments on a graduated basis.
Contractual Obligations The following summarizes our contractual obligations as of December 31, 2024: Payment Due by Period Total Less than 1 Year 1 to 3 Years 4 to 5 Years More than 5 Years Operating Leases $ 8,303 $ 3,763 $ 4,540 $ — $ — Purchase Obligations $ 39,530 16,088 23,442 — — Total $ 47,833 $ 19,851 $ 27,982 $ — $ — 67 Our existing office and hosting facilities lease agreements provide us with the option to renew and generally provide for rental payments on a graduated basis.
Subscription revenue may include immaterial amounts from non-health system clients whose business model acts similarly to those clients. 57 Average Annual Contract Value: Average annual contract value is defined as total health system subscription revenue for the fiscal period divided by average number of health system clients.
Average Annual Contract Value: Average annual contract value is defined as total health system subscription revenue for the fiscal period divided by average number of health system clients.
The following table presents a reconciliation of adjusted EBITDA from the most comparable GAAP measure, net loss, for each of the years ended December 31, 2023, 2022 and 2021: Years Ended December 31, (in thousands) 2023 2022 2021 Net loss $ (679,171 ) $ (272,072 ) $ (176,782 ) Add: Depreciation and amortization 31,492 26,153 16,089 Interest and other income, net (19,422 ) (6,123 ) (120 ) (Expense) benefit from income taxes 3,860 64 (5,376 ) Goodwill impairment 436,479 — — Stock-based compensation 72,040 69,144 43,809 Severance (1) 4,414 — — Public offering expenses (2) — — 1,223 Acquisition-related (income) expenses — — 7,289 Noncash expenses and contingent consideration adjustments (3) — 12,153 (10,987 ) Capitalized software development costs (15,056 ) (10,155 ) — Litigation expense (4) — 5,575 2,182 Adjusted EBITDA $ (165,364 ) $ (175,261 ) $ (122,673 ) (1) Severance costs associated with the termination of employees during the year ended December 31 2023.
The following table presents a reconciliation of adjusted EBITDA from the most comparable GAAP measure, net loss, for each of the years ended December 31, 2024, 2023 and 2022: Years Ended December 31, (in thousands) 2024 2023 2022 Net loss $ (212,638 ) $ (679,171 ) $ (272,072 ) Add: Depreciation and amortization 32,975 31,492 26,153 Interest and other income, net (10,757 ) (19,422 ) (6,123 ) Expense from income taxes 2,751 3,860 64 Goodwill impairment — 436,479 — Stock-based compensation 47,505 72,040 69,144 Severance and strategic transformation costs (1) 20,892 4,414 — Noncash expenses and contingent consideration adjustments (2) — — 12,153 Capitalized software costs (15,102 ) (15,056 ) (10,155 ) Litigation expense (3) — — 5,575 Adjusted EBITDA $ (134,374 ) $ (165,364 ) $ (175,261 ) (1) Severance and strategic transformation costs include expenses associated with the termination of employees and expenses that focus on transforming the strategy of the Company’s sales and growth organization as well as our overall cost structure during the year ended December 31, 2024 and 2023, as described below in “—Severance and strategic transformation costs.” (2) Noncash expenses and contingent consideration adjustments include, noncash compensation costs incurred by selling shareholders and adjustments made to the contingent consideration.
Cash Provided by (Used in) Financing Activities Cash provided by financing activities for the year ended December 31, 2023, was $2.1 million.
Cash Provided by (Used in) Financing Activities Cash provided by financing activities for the year ended December 31, 2024, was $1.4 million. Cash provided by financing activities consisted of $1.4 million of proceeds from the exercise of employee stock options and employee stock purchase plan. Cash provided by financing activities for the year ended December 31, 2023, was $2.1 million.
For the year ended December 31, 2022, interest income and other expenses consist primarily of interest income and gains from our cash equivalents and short-term investments, the decline in interest income is due to the decline in the investments held during the year.
Interest Income and Other Income (Expense), net For the year ended December 31, 2024, interest income and other expenses consist primarily of interest income and gains from our cash equivalents.
As shown in the accompanying consolidated financial statements, the Company incurred a loss from operations of $692.1 million and a net loss of $679.2 million for year ended December 31, 2023 and had an accumulated deficit of $1,757.8 million as of December 31, 2023.
Our cash and cash equivalents are comprised of money market funds. As shown in the accompanying consolidated financial statements, the Company incurred a loss from operations of $217.5 million and a net loss of $212.6 million for year ended December 31, 2024 and had an accumulated deficit of $1,965.9 million as of December 31, 2024.
We have also expanded the use of offshore resources to provide more efficient rates which are designed to offset the increased research and development spend. While we have recognized an increase in the research and development expense throughout the prior years, the corresponding future revenue growth is expected to result in lower expenses as a percentage of revenue.
We have made an effort to optimize our resourcing structure with a mix of nearshore and offshore employees and contractors, resulting in a more efficient cost structure. While we have recognized an increase in the research and development expense throughout the prior years, the corresponding future revenue growth is expected to result in lower expenses as a percentage of revenue.
General and administrative expenses, excluding the increase in stock-based compensation, are expected to remain relatively flat in future periods as we have now recognized the impact of the regulatory and compliance costs associated with being a publicly traded company and scaled the Company to meet these complexities and requirements.
General and administrative expenses, excluding the decrease in stock-based compensation, are expected to decrease in 2025 and then remain relatively flat in future periods as we have now recognized the impact of many strategic transformation costs.
We will continue to invest appropriately in sales expenses as we look to grow with new prospects and expand the business of our existing clients.
Sales and Marketing Expenses Sales expenses consist primarily of employee-related expenses, including salaries, benefits, commissions, travel and stock-based compensation costs for our employees engaged in commercial activities. We will continue to invest appropriately in sales expenses as we look to grow with new prospects and expand the business of our existing clients.
Other revenue increased by $4.0 million due to increased professional service revenue for new clients. 63 Costs of Revenue, Excluding Depreciation and Amortization of Intangible Assets For the year ended December 31, 2023, the increase in cost of revenue was primarily due to an increase of $4.5 million in employee-related costs such as salary and benefits for the fulfilment of professional service obligations.
Consulting spend also decreased by $2.1 million. The Company's cost savings measures continue to have a positive impact on gross margin. For the year ended December 31, 2023, the increase in cost of revenue was primarily due to an increase of $4.5 million in employee-related costs such as salary and benefits for the fulfilment of professional service obligations.
Total general and administrative employee headcount decreased to 229 on December 31, 2023, as compared to 248 on December 31, 2022 and 221 on December 31, 2021. Depreciation and Amortization Expense Depreciation expense remained consistent for the year ended December 31, 2023. Amortization expense increased by $6.2 million for the year ended December 31, 2023.
Total general and administrative employee headcount decreased to 189 on December 31, 2024, as compared to 229 on December 31, 2023 and 248 on December 31, 2022. Depreciation and Amortization Expense Depreciation expense declined $0.3 million from the year ended December 31, 2024 as assets from prior years have become fully depreciated.
Income tax expense was $0.1 million for the year ended December 31, 2022, compared to income tax benefit of $5.4 million for the year ended December 31, 2021.
(Expense) Benefit from Income Taxes Income tax expense was $2.8 million for the year ended December 31, 2024, compared to income tax expense of $3.9 million for the year ended December 31, 2023.
We expect our general and administrative expenses to decrease as a percentage of our total revenue over the next several years. Our general and administrative expenses may fluctuate as a percentage of our total revenue from period to period due to the seasonality of our total revenue and the timing and extent of our general and administrative expenses.
Our research and development expenses may fluctuate as a percentage of our total revenue from period to period due to the seasonality of our total revenue and the timing and extent of our research and development expenses based on customer demand and emerging market trends .
Depreciation and Amortization Expense Depreciation and amortization expense includes the amortization of intangible assets and depreciation related to our fixed assets. Amortization of intangible assets consists of the amortization of acquisition-related intangible assets, which are customer relationships, contractor relationships, technology and trade names, as well as the amortization of capitalized software costs.
Amortization of intangible assets consists of the amortization of acquisition-related intangible assets, which are customer relationships, contractor relationships, technology and trade names, as well as the amortization of capitalized software costs. 62 Goodwill Impairment Goodwill impairment is the result of the fair value of the Company's one reporting unit being less than its carrying value.
Other revenue decreased by $4.7 million primarily related to a decrease in hardware and services revenue. For the year ended December 31, 2022, the increase in revenue from the prior period was substantially driven by an increase in subscription revenue.
Other revenue decreased by $4.7 million primarily related to a decrease in hardware and services revenue.
As a result of these transactions, contractor and customer relationships, acquired technology, and trade name were identified as intangible assets, and are amortized over their estimated useful lives. We recognize the excess of the purchase price over the fair value of identifiable net assets acquired as goodwill.
As a result of these transactions, contractor and customer relationships, acquired technology, and trade name were identified as intangible assets, and are amortized over their estimated useful lives. When there is a triggering event the Company assesses the potential impact on its definite-lived intangibles and other long-lived assets.
Visits: Years Ended December 31, 2023 2022 2021 Overall Visits 6,290,000 6,465,000 5,885,000 AMG Visits 1,590,000 1,640,000 1,480,000 Total Visit Revenue $ 119.5 million $ 124.3 million $ 116.6 million Revenue per Visit $ 75 $ 76 $ 79 (1) In the year ended December 31, 2022, we revised our methodology of how we count visits in our Amwell Psychiatric Care business which is part of our AMG visits.
Visits: Years Ended December 31, 2024 2023 2022 Overall Visits 5,905,000 6,290,000 6,465,000 AMG Visits 1,475,000 1,590,000 1,640,000 Total Visit Revenue $ 116.5 million $ 119.5 million $ 124.3 million Revenue per Visit $ 79 $ 75 $ 76 AMG Visit : An AMG visit is a case completed by our AMG affiliate providers and visit revenue reflects fee-for-service revenue to AMG for the visit.
When evaluating our performance, you should consider adjusted EBITDA alongside other financial performance measures, including our net loss and other GAAP results.
When evaluating our performance, you should consider adjusted EBITDA alongside other financial performance measures, including our net loss and other GAAP results. Severance and strategic transformation costs In the twelve months ended December 31, 2024, the Company recorded charges of $20.9 million, in connection with severance and strategic transformation costs.
Provision for (Benefit from) Income Taxes The income tax provision and benefit were primarily due to state and foreign income tax expense, and benefit related to release of the valuation allowance as a result of our acquisitions. 62 Deferred tax assets are reduced by a valuation allowance to the extent management believes it is not more likely than not to be realized.
We did not incur material interest expenses in the period as there were no outstanding debts or notes payables. Provision for (Benefit from) Income Taxes The income tax provision and benefit were primarily due to state and foreign income tax expense, and benefit related to release of the valuation allowance as a result of our acquisitions.
We review the contract terms and conditions to evaluate the timing and amount of revenue recognition; the related contract balances; and our remaining performance obligations. These evaluations require significant judgment around the proper identification of performance obligations, which could affect the timing and amount of revenue recognized.
In general, we satisfy the majority of our performance obligations over time as we transfer the promised services to our clients. We review the contract terms and conditions to evaluate the timing and amount of revenue recognition; the related contract balances; and our remaining performance obligations.
Total sales and marketing employee headcount increased to 304 on December 31, 2023, as compared to 291 on December 31, 2022 and 249 on December 31, 2021.
Total research and development employee headcount decreased to 289 on December 31, 2024, as compared to 332 on December 31, 2023 and 358 on December 31, 2022.
This increased spend represents an investment in a more scalable and economically beneficial solution that will properly position the Company to benefit in the long term.
We believe increased spending in prior years was a temporary investment to accelerate development of a more scalable and economically beneficial solution that will properly position the Company to benefit in the long term and have seen marked decline during 2024 as we return to normal levels of spend in future periods.
There was also a decrease in insurance costs of $2.9 million. 64 For the year ended December 31, 2022, the increase in general and administrative expense was driven by an increase related to employee-related costs (inclusive of $23.2 million of stock compensation expense) of approximately $33.5 million, due to additional equity awards granted in 2022 and headcount increase.
Total sales and marketing employee headcount decreased to 180 on December 31, 2024, as compared to 304 on December 31, 2023 and 291 on December 31, 2022. 64 General and Administrative Expenses For the year ended December 31, 2024, the decrease in general and administrative expense was driven by a decrease in employee-related costs of $9.6 million.
For the year ended December 31, 2022, the increase in research and development expense was primarily driven by an increase of $14.6 million in consulting services primarily for the Converge platform (an additional $10.2 million was capitalized as software development costs). There was also a $12.2 million increase in employee-related costs (inclusive of stock compensation expense) due to increased headcount.
Research and Development Expenses For the year ended December 31, 2024, the decrease in research and development expense was primarily driven by a decrease of $12 million in consulting spend as the peak development of the Amwell Converge ™ platform is complete.
Cash used in investing activities was $59.6 million for the year ended December 31, 2021.
For the year ended December 31, 2023, cash used in operating activities was $148.3 million. The primary driver of this use of cash was our net loss of $679.2 million.
The net loss was partially offset by non-cash expenses of $63.0 million (primarily stock-based compensation of $43.8 million and depreciation and amortization of $16.1 million). Cash Used in Investing Activities Cash used in investing activities was $19.2 million for the year ended December 31, 2023.
Cash used in operations reflects an increase in accounts receivable of $25.0 million which was primarily driven by service delays in third party providers. The net loss was 66 partially offset by non-cash expenses of $95.3 million (primarily stock-based compensation of $47.5 million and depreciation and amortization of $33.0 million).
For the year ended December 31, 2022, the increase in cost of revenue was primarily due to an increase of $4.0 million in consulting costs and $3.0 million related to employee-related costs due to increased headcount. There was also an increase in provider costs of $4.1 million due to increased visits.
Sales and Marketing Expenses For the year ended December 31, 2024, the decrease in sales and marketing expense was driven by a decrease in employee-related costs of $8.6 million, a decrease in other consulting spend of $1.9 million, a decrease in business related travel of $1.1 million and a decrease in marketing spend of $1.0 million, due to headcount reduction and cost savings measures put into place.
Removed
In the year ended December 31, 2022, our clients completed a total of 6.5 million visits on our enterprise platform, while in the year ended December 31, 2023, 6.3 million visits were completed. The decrease in number of visits is due in part to the churn experienced with re-platforming as well as a decline in the number of scheduled visits.
Added
Recent Developments On January 8, 2025, we, Aligned Telehealth, LLC ("Aligned"), one of our wholly owned subsidiaries, and Avel eCare, LLC (the “Buyer”) entered into an asset purchase agreement (the “Agreement”) relating to the sale to the Buyer of all property and assets owned, leased or licensed by the Seller that are primarily used or held for use in connection with our business of providing telepsychiatry services to hospitals and correctional programs (the “Business”), subject to certain specified exclusions such as cash.
Removed
This change resulted in an adjustment to the number of visits reported as of December 31, 2021. The numbers included in the table above reflect the current methodology.
Added
In connection with such purchase and sale, the Buyer assumed specified contracts and the related accounts receivable and all accounts payable and accrued expenses of the Business.
Removed
AMG Visit : An AMG visit is a case completed by our AMG affiliate providers and visit revenue reflects fee-for-service revenue to AMG for the visit. 58 Active Providers Historically, an important indicator of the value of our enterprise platform and software as a service to our clients was the number of non-AMG providers that are active on the enterprise platform.
Added
The purchase price is comprised of (i) an upfront cash payment of $20.7 million, which is equal to 1.1x the Business’ trailing twelve-month revenue, excluding on-site revenue attributable to certain of the Business’ contracts, subject to customary adjustments and (ii) an additional cash payment (the “Additional Payment”) equal to 0.4x the Buyer and its affiliates’ aggregate revenues arising from the provision of the Business to current customers and potential customers in the sales pipeline during the twelve-month period immediately following the closing, excluding revenues arising from the provision of on-site psychiatric services to certain of the Business’ contracts and other specified revenues, which Additional Payment is payable within ten days following the final determination of the Additional Payment amount.
Removed
We defined “Active Providers” as providers that have delivered a visit on the enterprise platform at least once in the last 12 months. Active Providers was initially provided as an indicator that the activity on our platform in a post pandemic world was healthy and sustained.
Added
The Company divested our APC business as it was determined the offering no longer fit our goals around profitability and growth.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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Biggest changeThe Company also has a branch with a functional currency of the New Israeli Shekel. The transactional activity for these entities in the years ended December 31, 2022 and 2023 was not considered significant. In December 2023 the Company established a foreign subsidiary in Columbia, however there were no operations in this entity for the year ended December 31, 2023.
Biggest changeIn addition the Company has three foreign subsidiaries from the acquisition of SilverCloud, with functional currencies of the Euro, British pound and Australian dollars. The transactional activity for these entities in the years ended December 31, 2023 and 2024 was not considered significant. Accordingly, we believe we do not have a material exposure to foreign currency risk.
However, the U.S. economy has experienced and is continuing to experience high rates of inflation, and such inflation risk may continue in 2024. If our costs were to become subject to significant inflationary pressures, we may not be able to fully offset such higher costs through price increases.
However, the U.S. economy has experienced and is continuing to experience high rates of inflation, and such inflation risk may continue in 2025. If our costs were to become subject to significant inflationary pressures, we may not be able to fully offset such higher costs through price increases.
Accordingly, we believe we do not have a material exposure to foreign currency risk. As our international operations expand, it will increase our exposure to foreign currency exchange risk in the future. Inflation Risk We do not believe that inflation had a material effect on our business, financial condition or results of operations in the last two years.
As our international operations expand, it will increase our exposure to foreign currency exchange risk in the future. Inflation Risk We do not believe that inflation had a material effect on our business, financial condition or results of operations in the last two years.
Item 7A. Quantitative and Qualita tive Disclosures About Market Risk Interest Rate Risk We had cash and cash equivalents totaling $372.0 million, $538.5 million, and $746.4 million as of December 31, 2023, 2022 and 2021, respectively. As of December 31, 2023, 2022 and 2021 the Company held no investments.
Item 7A. Quantitative and Qualita tive Disclosures About Market Risk Interest Rate Risk We had cash and cash equivalents totaling $228.3 million, $372.0 million, and $538.5 million as of December 31, 2024, 2023 and 2022, respectively. As of December 31, 2024, 2023 and 2022 the Company held no investments.
All our investments are denominated in U.S. dollars. 70 We do not believe that an increase or decrease of 100 basis points in interest rates would have a material effect on our business, financial condition or results of operations. However, our cash equivalents are subject to market risk due to changes in interest rates.
We do not believe that an increase or decrease of 100 basis points in interest rates would have a material effect on our business, financial condition or results of operations. However, our cash equivalents are subject to market risk due to changes in interest rates.
Fixed rate securities may have their market value adversely affected due to a rise in interest rates. Interest rates have risen and may continue to rise in 2024.
Fixed rate securities may have their market value adversely affected due to a rise in interest rates. Interest rates rose some in early 2024 but have started to decline may continue to decline in 2025.
The cash and cash equivalents are held for a variety of growth and investments as well as working capital purposes. Our investments are made for capital preservation purposes. We do not enter into investments for trading or speculative purposes.
The cash and cash equivalents are held for investment in our business operations and working capital purposes. Our investments are made for capital preservation purposes. We do not enter into investments for trading or speculative purposes. All our investments are denominated in U.S. dollars.
We have limited operations outside the United States. As of December 31, 2023 the Company has one foreign subsidiary in Israel, the functional currency of that subsidiary is the U.S. dollar. In addition the Company has three foreign subsidiaries from the acquisition of SilverCloud, with functional currencies of the Euro, British pound and Australian dollars.
We have limited operations outside the United States. As of December 31, 2024 the Company has a foreign subsidiary and branch in Israel, the functional currency for each is New Israel Shekel, and another foreign subsidiary in Colombia, the functional currency of this subsidiary is the U.S. dollar.

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