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Ontrak Health Announces 2025 First Quarter Financial Results

Ontrak, Inc. (NASDAQ: OTRK) (“Ontrak” or the “Company”), a leading AI-powered and technology-enabled behavioral healthcare company, today reported its financial results for the first quarter e...

Autore: Business Wire

Ontrak Health Announces 2025 First Quarter Financial Results

MIAMI: Ontrak, Inc. (NASDAQ: OTRK) (“Ontrak” or the “Company”), a leading AI-powered and technology-enabled behavioral healthcare company, today reported its financial results for the first quarter ended March 31, 2025.

Management Commentary

Brandon LaVerne, Ontrak Health’s Chief Executive Officer, stated, “We are thrilled to report that membership in our Ontrak programs has nearly doubled year over year, validating our multi-solution approach across Medicare Advantage, Medicaid, and Commercial populations. Our AI-driven Advanced Engagement System has transformed how we deliver care, enabling unprecedented operational efficiency while maintaining our focus on the human elements that drive meaningful outcomes. Our successful implementations at Intermountain Health and our Northeast Regional Plan, coupled with our optimism on converting prospects in our pipeline, provide a path to doubling our run-rate revenue in 2025.”

First Quarter 2025 Financial Results Highlights

Adjusted EBITDA, non-GAAP net loss and non-GAAP diluted net loss per common share are non-GAAP financial measures. See our description and reconciliation of such non-GAAP measures at the end of this release.

First Quarter 2025 and Recent Operating Highlights

Financial Outlook

The following outlook is based on information available as of the date of this press release and is subject to change in the future.

For the quarter ending June 30, 2025, the Company estimates revenue in the range of $2.2 million to $2.6 million.

Conference Call & Webcast Details

The Company will host a conference call/webcast today at 4:30 pm ET/1:30 pm PT. Investors, analysts, employees and the general public can access the call by registering online for dial-in information or via live audio webcast at: https://ontrakhealth.com/investors/presentations-events. Participants interested in dialing in to the conference call are requested to register a day in advance or at a minimum 15 minutes before the start of the call to obtain a unique pin for the call.

A replay of the call will be available via webcast for on-demand listening shortly after the completion of the call, at the same web link, and will remain available for approximately 90 days.

About Ontrak, Inc.

Ontrak Health (Nasdaq: OTRK) is a value-based behavioral healthcare company that identifies and engages people with unmet health needs using its proprietary Advanced Engagement System to improve clinical outcomes and reduce total cost of care. Ontrak uniquely identifies, engages, and delivers care to the most vulnerable members of the behavioral health population who would otherwise fall through the cracks of the healthcare system. Through our Advanced Engagement System, we achieve higher engagement rates with individuals with anxiety, depression, substance use disorder and chronic disease by delivering personalized care coaching and customized care pathways that help them receive the treatment and advocacy they need, despite the socio-economic, medical and health system barriers that exacerbate the severity of their comorbid illnesses. The company’s whole-person approach integrates AI, predictive analytics, comprehensive clinical and claims data, patient-generated information, and digital interfaces with care coach engagements to deliver improved member health, better healthcare system utilization, and durable outcomes and savings to healthcare payors.

Learn more at www.ontrakhealth.com.

Forward-Looking Statements

This press release contains “forward-looking” statements that are based on the Company’s beliefs and assumptions and on information currently available to the Company on the date of this press release and are made pursuant to the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include all statements that are not historical facts and can be identified by terms such as “may,” “will,” “could,” “should,” “believes,” “estimates,” “projects,” “potential,” “expects,” “plan,” “anticipates,” “intends,” “continues,” “forecast,” “designed,” “goal,” or the negative of those words or other comparable words. Forward-looking statements may include, but are not limited to, the Company’s belief that it will be successful in returning to sustained growth, that its strategy will accelerate the Company’s return to growth by converting new customers and expand with existing customers, the Company's ability to convert its pipeline of prospects into active customers, the Company's ability to maximize its differentiated platform and deliver return on investment for customers, the Company’s revenue on a per member per month basis, gross margin estimates and the Company's estimated revenue for quarter ending June 30, 2025. Forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause the Company’s actual results, performance or achievements to be materially different from those expressed or implied by forward-looking statements, including, without limitation, risks related to: the Company’s ability to successfully execute on its strategy and business plan; the Company’s ability to increase its revenue and efficiently manage expenses and achieve profitability; the Company’s high customer concentration and the ability of its customers to terminate their contracts for convenience; the adequacy of the Company’s existing cash resources and anticipated capital commitments and future cash requirements to enable the Company to continue as a going concern; Company’s ability to access the financing provided by the financing commitment and the potential benefits to the Company of such financing; the Company’s ability to raise additional capital when needed; difficulty enrolling new members and maintaining existing members in the Company’s programs; the effectiveness of the Company’s treatment programs; lower than anticipated eligible members under the Company’s contracts; the Company’s dependence on key personnel and the Company’s ability to recruit and retain key personnel; the Company’s ability to maintain the listing of its stock on Nasdaq; the federal jury's conviction of the Company’s largest stockholder and former Chief Executive Officer and Chairman of one count of securities fraud and two counts of insider trading, and whether governmental authorities will institute separate investigations or proceedings against the Company and/or its current or former executives and/or directors; substantial regulation in the health care industry; changes in regulations or issuance of new regulations or interpretations; the Company’s limited operating history; difficulty in developing, exploiting and protecting proprietary technologies; business disruption and related risks; general economic conditions, nationally and globally, and their effect on the market for our service; intense competition and competitive pressures and trends in the Company’s industry and the Company’s ability to successfully compete; changes in laws, regulations, or policies; and risks related to the Company’s ability to realize the potential benefits of and to effectively integrate acquisitions. For a further list and description of the risks and uncertainties the Company faces, please refer to the Company’s most recent Securities and Exchange Commission filings which are available on its website at http://www.sec.gov. Forward-looking statements are current only as of the date they are made and the Company assumes no obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.

Non-GAAP Financial Measures

To supplement its consolidated financial statements, which are prepared and presented in accordance with U.S. generally accepted accounting principles, or GAAP, the Company has provided in this press release and the quarterly conference call held on the date hereof certain non-GAAP financial measures. The non-GAAP financial measures presented include EBITDA, Adjusted EBITDA, Non-GAAP net loss, and Non-GAAP net loss per common share, which are not U.S. GAAP financial measures. We believe that the presentation of these financial measures enhances an investor’s understanding of our financial performance. We further believe that these financial measures are useful financial metrics to assess our operating performance from period-to-period by excluding certain items that we believe are not representative of our core business.

EBITDA consists of net loss before interest, taxes, depreciation and amortization expenses. Adjusted EBITDA consists of net loss before interest, taxes, depreciation, amortization, stock-based compensation, restructuring, severance and related costs, and gain/loss on change in fair value of warrant liability. We believe that making such adjustments provides investors meaningful information to understand our results of operations and the ability to analyze our financial and business trends on a period-to-period basis.

Non-GAAP net loss consists of net loss adjusted for stock-based compensation, restructuring, severance and related costs, and gain/loss on change in fair value of warrant liability. Non-GAAP net loss per common share consists of loss per share adjusted for non-GAAP net loss attributable to common stockholders. We believe that making such adjustments provides investors meaningful information to understand our results of operations and the ability to analyze our financial and business trends on a period-to-period basis.

We believe the above non-GAAP financial measures are commonly used by investors to evaluate our performance and that of our competitors. However, our use of the term EBITDA, Adjusted EBITDA, Non-GAAP net loss and Non-GAAP net loss per common share may vary from that of others in our industry. None of EBITDA, Adjusted EBITDA, Non-GAAP net loss or Non-GAAP net loss per common share should be considered as an alternative to net loss before taxes, net loss, net loss per common share or any other performance measures derived in accordance with U.S. GAAP as measures of performance.

See the Reconciliation of Non-GAAP Measures table at the end of this press release for a reconciliation of the Non-GAAP financial measures to U.S. GAAP financial measures.

ONTRAK, INC.

Consolidated Statements of Operations

(in thousands, except per share data)

 

 

 

Three Months Ended
March 31,

 

 

2025

 

2024

Revenue

 

$

2,017

 

 

$

2,680

 

Cost of revenue

 

 

1,271

 

 

 

975

 

Gross profit

 

 

746

 

 

 

1,705

 

 

 

 

 

 

Operating expenses:

 

 

 

 

Research and development

 

 

1,408

 

 

 

1,078

 

Sales and marketing

 

 

564

 

 

 

532

 

General and administrative

 

 

4,624

 

 

 

4,078

 

Restructuring, severance and related costs

 

 

 

 

 

290

 

Total operating expenses

 

 

6,596

 

 

 

5,978

 

Operating loss

 

 

(5,850

)

 

 

(4,273

)

 

 

 

 

 

Other expense, net

 

 

 

 

 

(2

)

Interest expense, net

 

 

(1,041

)

 

 

(183

)

Loss before income taxes

 

 

(6,891

)

 

 

(4,458

)

Income tax expense

 

 

 

 

 

 

Net loss

 

 

(6,891

)

 

 

(4,458

)

Dividends on preferred stock - undeclared

 

 

(2,239

)

 

 

(2,239

)

Net loss attributable to common stockholders

 

$

(9,130

)

 

$

(6,697

)

 

 

 

 

 

Net loss per common share, basic and diluted

 

$

(1.65

)

 

$

(1.65

)

 

 

 

 

 

Weighted-average common shares outstanding, basic and diluted

 

 

5,517

 

 

 

4,059

 

ONTRAK, INC.

Consolidated Balance Sheets

(in thousands, except share and per share data)

 

 

March 31,
2025

 

December 31,
2024

Assets

(unaudited)

 

 

Current assets:

 

 

 

Cash

$

4,087

 

 

$

5,710

 

Accounts receivable, net

 

602

 

 

 

1,012

 

Unbilled receivables

 

879

 

 

 

595

 

Deferred costs

 

179

 

 

 

178

 

Prepaid expenses and other current assets

 

2,162

 

 

 

2,065

 

Total current assets

 

7,909

 

 

 

9,560

 

Long-term assets:

 

 

 

Property and equipment, net

 

454

 

 

 

490

 

Goodwill

 

5,713

 

 

 

5,713

 

Other assets

 

4,064

 

 

 

5,167

 

Operating lease right-of-use assets

 

131

 

 

 

145

 

Total assets

$

18,271

 

 

$

21,075

 

Liabilities and stockholders' equity

 

 

 

Current liabilities:

 

 

 

Accounts payable

$

725

 

 

$

179

 

Accrued compensation and benefits

 

824

 

 

 

558

 

Deferred revenue

 

19

 

 

 

18

 

Demand notes payable, net

 

7,037

 

 

 

6,008

 

Current portion of operating lease liabilities


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