SEC Filing - GoodRx

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gdrx-20240630

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

________________________________

FORM 10-Q

________________________________

(Mark One)


x	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2024


o	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ______ to ______.

Commission File Number: 001-39549

________________________________

GoodRx Holdings, Inc.

(Exact Name of Registrant as Specified in its Charter)

________________________________


Delaware	47-5104396
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

2701 Olympic Boulevard Santa Monica, CA	90404
(Address of principal executive offices)	(Zip Code)

(855) 268-2822

(Registrant’s telephone number, including area code)

N/A

(Former name, former address and former fiscal year, if changed since last report)

________________________________

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Class A common stock, $0.0001 par value per share	GDRX	The Nasdaq Stock Market LLC

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities

Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and

(2) has been subject to such filing requirements for the past 90 days. Yes x No o

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted

pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the

registrant was required to submit such files). Yes x No o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller

reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting

company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.


Large accelerated filer	o	Accelerated filer	x

Non-accelerated filer	o	Smaller reporting company	o

Emerging growth company	o

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for

complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes o No x

As of July 30, 2024, the registrant had 98,583,716 shares of Class A common stock, $0.0001 par value per share, and

280,869,320 shares of Class B common stock, $0.0001 par value per share, outstanding.

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FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q contains forward-looking statements. We intend such forward-looking statements

to be covered by the safe harbor provisions for forward-looking statements contained in Section 27A of the Securities Act of

1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). All

statements other than statements of historical facts contained in this Quarterly Report on Form 10-Q may be forward-looking

statements. In some cases, you can identify forward-looking statements by terms such as “may,” “will,” “should,” “expects,”

“plans,” “anticipates,” “could,” “intends,” “targets,” “projects,” “contemplates,” “believes,” “estimates,” “forecasts,” “predicts,”

“potential” or “continue” or the negative of these terms or other similar expressions. Forward-looking statements contained in

this Quarterly Report on Form 10-Q include, but are not limited to statements regarding our future results of operations and

financial position, industry and business trends, the anticipated impact of recent changes in the U.S. retail pharmacy

landscape, our value proposition, our collaborations and partnerships with third parties, including our integrated savings

program, stock compensation, our stock repurchase program, potential outcomes and estimated impacts of certain legal

proceedings, our business strategy, our plans, market growth and our objectives for future operations.

The forward-looking statements in this Quarterly Report on Form 10-Q are only predictions. We have based these

forward-looking statements largely on our current expectations and projections about future events and financial trends that

we believe may affect our business, financial condition and results of operations. Forward-looking statements involve known

and unknown risks, uncertainties and other important factors that may cause our actual results, performance or

achievements to be materially different from any future results, performance or achievements expressed or implied by the

forward-looking statements, including, but not limited to, risks related to our limited operating history and early stage of

growth; our ability to achieve broad market education and change consumer purchasing habits; our general ability to

continue to attract, acquire and retain consumers in a cost-effective manner; our significant reliance on our prescription

transactions offering and ability to expand our offerings; changes in medication pricing and the significant impact of pricing

structures negotiated by industry participants; our general inability to control the categories and types of prescriptions for

which we can offer savings or discounted prices; our reliance on a limited number of industry participants, including

pharmacy benefit managers, pharmacies, and pharma manufacturers; the competitive nature of industry; risks related to

pandemics, epidemics or outbreak of infectious disease, such as COVID-19; the accuracy of our estimate of our

addressable market and other operational metrics; our ability to respond to changes in the market for prescription pricing

and to maintain and expand the use of GoodRx codes; our ability to maintain positive perception of our platform or maintain

and enhance our brand; risks related to any failure to maintain effective internal control over ﬁnancial reporting; risks related

to use of social media, emails, text messages and other messaging channels as part of our marketing strategy; our

dependence on our information technology systems and those of our third-party vendors, and risks related to any failure or

significant disruptions thereof; risks related to government regulation of the internet, e-commerce, consumer data and

privacy, information technology and cybersecurity; risks related to a decrease in consumer willingness to receive

correspondence or any technical, legal or any other restrictions to send such correspondence; risks related to any failure to

comply with applicable data protection, privacy and security, advertising and consumer protection laws, regulations,

standards, and other requirements; our ability to utilize our net operating loss carryforwards and certain other tax attributes;

the risk that we may be unable to realize expected benefits from our restructuring and cost reduction efforts; our ability to

attract, develop, motivate and retain well-qualified employees; risks related to our acquisition strategy; risks related to our

debt arrangements; interruptions or delays in service on our apps or websites or any undetected errors or design faults; our

reliance on third-party platforms to distribute our platform and offerings, including software as-a-service technologies;

systems failures or other disruptions in the operations of these parties on which we depend; risks related to climate change;

the increasing focus on environmental sustainability and social initiatives; risks related to our intellectual property; risks

related to operating in the healthcare industry; risks related to our organizational structure; litigation related risks; our ability

to accurately forecast revenue and appropriately plan our expenses in the future; risks related to general economic factors,

natural disasters or other unexpected events; risks related to fluctuations in our tax obligations and effective income tax rate

which could materially and adversely affect our results of operations; risks related to the recent healthcare reform legislation

and other changes in the healthcare industry and in healthcare spending which may adversely affect our business, financial

condition and results of operations; as well as the other important factors discussed in the section entitled “Risk Factors” of

our Annual Report on Form 10-K for the fiscal year ended December 31, 2023 (“2023 10-K”) and in our other filings with the

Securities and Exchange Commission (“SEC”). The forward-looking statements in this Quarterly Report on Form 10-Q are

based upon information available to us as of the date of this Quarterly Report on Form 10-Q, and while we believe such

information forms a reasonable basis for such statements, such information may be limited or incomplete, and our

statements should not be read to indicate that we have conducted an exhaustive inquiry into, or review of, all potentially

available relevant information. These statements are inherently uncertain and investors are cautioned not to unduly rely

upon these statements.

You should read this Quarterly Report on Form 10-Q and the documents that we reference in this Quarterly Report on

Form 10-Q and have filed as exhibits to this Quarterly Report on Form 10-Q with the understanding that our actual future

results, levels of activity, performance and achievements may be materially different from what we expect. We qualify all of

our forward-looking statements by these cautionary statements. These forward-looking statements speak only as of the date

of this Quarterly Report on Form 10-Q. Except as required by applicable law, we do not plan to publicly update or revise any

forward-looking statements contained in this Quarterly Report on Form 10-Q, whether as a result of any new information,

future events or otherwise.

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We periodically post information that may be important to investors on our investor relations website at https://

investors.goodrx.com. We intend to use our website as a means of disclosing material non-public information and for

complying with our disclosure obligations under Regulation FD. Accordingly, investors and potential investors are

encouraged to consult our website regularly for important information, in addition to following GoodRx’s press releases,

filings with the SEC and public conference calls and webcasts. The information contained on, or that may be accessed

through, our website is not incorporated by reference into, and is not a part of, this Quarterly Report on Form 10-Q.

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		Page

PART I.	FINANCIAL INFORMATION
Item 1.	Condensed Consolidated Financial Statements (Unaudited)	1
	Condensed Consolidated Balance Sheets	1
	Condensed Consolidated Statements of Operations	2
	Condensed Consolidated Statements of Stockholders’ Equity	3
	Condensed Consolidated Statements of Cash Flows	5
	Notes to Condensed Consolidated Financial Statements	6
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	13
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	22
Item 4.	Controls and Procedures	22

PART II.	OTHER INFORMATION
Item 1.	Legal Proceedings	23
Item 1A.	Risk Factors	23
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	23
Item 3.	Defaults Upon Senior Securities	23
Item 4.	Mine Safety Disclosures	23
Item 5.	Other Information	23
Item 6.	Exhibits	25
	Signatures	26

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PART I. FINANCIAL INFORMATION

Item 1. Condensed Consolidated Financial Statements (Unaudited)

GoodRx Holdings, Inc.

Condensed Consolidated Balance Sheets

(Unaudited)


(in thousands, except par values)	June 30, 2024	December 31, 2023
Assets
Current assets
Cash and cash equivalents	$524,903	$672,296
Accounts receivable, net	161,774	143,608
Prepaid expenses and other current assets	63,878	56,886
Total current assets	750,555	872,790
Property and equipment, net	14,495	15,932
Goodwill	410,769	410,769
Intangible assets, net	56,022	60,898
Capitalized software, net	111,774	95,439
Operating lease right-of-use assets, net	29,893	29,929
Deferred tax assets, net	65,268	65,268
Other assets	36,614	37,775
Total assets	$1,475,390	$1,588,800
Liabilities and stockholders' equity
Current liabilities
Accounts payable	$16,884	$36,266
Accrued expenses and other current liabilities	73,172	71,329
Current portion of debt	7,029	8,787
Operating lease liabilities, current	5,388	6,177
Total current liabilities	102,473	122,559
Debt, net	645,648	647,703
Operating lease liabilities, net of current portion	49,316	48,403
Other liabilities	8,554	8,177
Total liabilities	805,991	826,842
Commitments and contingencies (Note 7)
Stockholders' equity
Preferred stock, $0.0001 par value; 50,000 shares authorized and zero shares issued and outstanding at June 30, 2024 and December 31, 2023	—	—
Common stock, $0.0001 par value; Class A: 2,000,000 shares authorized, 97,738 and 92,355 shares issued and outstanding at June 30, 2024 and December 31, 2023, respectively; and Class B: 1,000,000 shares authorized, 280,869 and 301,732 shares issued and outstanding at June 30, 2024 and December 31, 2023	38	40
Additional paid-in capital	2,121,079	2,219,321
Accumulated deficit	(1,451,718)	(1,457,403)
Total stockholders' equity	669,399	761,958
Total liabilities and stockholders' equity	$1,475,390	$1,588,800

See accompanying notes to condensed consolidated financial statements.

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GoodRx Holdings, Inc.

Condensed Consolidated Statements of Operations

(Unaudited)


	Three Months Ended June 30,		Six Months Ended June 30,
(in thousands, except per share amounts)	2024	2023	2024	2023
Revenue	$200,610	$189,677	$398,490	$373,663
Costs and operating expenses:
Cost of revenue, exclusive of depreciation and amortization presented separately below	11,870	16,339	24,338	33,034
Product development and technology	30,854	31,285	61,871	64,193
Sales and marketing	93,454	77,440	183,418	155,962
General and administrative	27,589	30,208	68,697	59,827
Depreciation and amortization	16,965	16,097	32,907	31,036
Total costs and operating expenses	180,732	171,369	371,231	344,052
Operating income	19,878	18,308	27,259	29,611
Other expense, net:
Other expense	—	—	—	(1,808)
Interest income	6,334	7,814	13,889	15,048
Interest expense	(14,566)	(14,054)	(29,209)	(27,187)
Total other expense, net	(8,232)	(6,240)	(15,320)	(13,947)
Income before income taxes	11,646	12,068	11,939	15,664
Income tax (expense) benefit	(4,952)	46,718	(6,254)	39,832
Net income	$6,694	$58,786	$5,685	$55,496
Earnings per share:
Basic	$0.02	$0.14	$0.01	$0.13
Diluted	$0.02	$0.14	$0.01	$0.13
Weighted average shares used in computing earnings per share:
Basic	376,254	412,221	386,153	412,322
Diluted	384,732	414,335	393,620	414,373

Stock-based compensation included in costs and operating expenses:
Cost of revenue	$64	$180	$140	$341
Product development and technology	6,259	7,534	12,107	16,123
Sales and marketing	9,396	(3,020)	17,523	1,392
General and administrative	10,871	13,203	21,916	25,540

See accompanying notes to condensed consolidated financial statements.

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GoodRx Holdings, Inc.

Condensed Consolidated Statements of Stockholders’ Equity

(Unaudited)


	Class A and Class B Common Stock		Additional Paid-in Capital	Accumulated Deficit	Total Stockholders' Equity
(in thousands)	Shares	Amount	Additional Paid-in Capital	Accumulated Deficit	Total Stockholders' Equity
Balance at December 31, 2023	394,087	$40	$2,219,321	$(1,457,403)	$761,958
Stock options exercised	604	—	2,666	—	2,666
Stock-based compensation	—	—	28,891	—	28,891
Vesting and settlement of restricted stock units	2,535	—	—	—	—
Common stock withheld related to net share settlement	(954)	—	(6,623)	—	(6,623)
Repurchases of Class A common stock (1)	(21,329)	(2)	(154,812)	—	(154,814)
Net loss	—	—	—	(1,009)	(1,009)
Balance at March 31, 2024	374,943	$38	$2,089,443	$(1,458,412)	$631,069
Stock options exercised	1,454	—	8,947	—	8,947
Stock-based compensation	—	—	30,885	—	30,885
Vesting and settlement of restricted stock units	3,262	—	—	—	—
Common stock withheld related to net share settlement	(1,231)	—	(9,343)	—	(9,343)
Repurchases of Class A common stock	—	—	290	—	290
Issuance of common stock through employee stock purchase plan	179	—	857	—	857
Net income	—	—	—	6,694	6,694
Balance at June 30, 2024	378,607	$38	$2,121,079	$(1,451,718)	$669,399

See accompanying notes to condensed consolidated financial statements.

_____________________________________________________

(1)Repurchases of Class A common stock for the three months ended March 31, 2024 include 20.9 million shares

repurchased from related parties (after giving effect to the automatic conversion of Class B common stock to Class

A common stock upon such repurchase) for an aggregate consideration of $151.4 million. See "Note 9.

Stockholders' Equity" for additional information.

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GoodRx Holdings, Inc.

Condensed Consolidated Statements of Stockholders’ Equity

(Unaudited)


	Class A and Class B Common Stock		Additional Paid-in Capital	Accumulated Deficit	Total Stockholders' Equity
(in thousands)	Shares	Amount	Additional Paid-in Capital	Accumulated Deficit	Total Stockholders' Equity
Balance at December 31, 2022	397,025	$40	$2,263,322	$(1,448,535)	$814,827
Stock options exercised	192	—	895	—	895
Stock-based compensation	—	—	28,263	—	28,263
Vesting and settlement of restricted stock units	1,668	—	—	—	—
Common stock withheld related to net share settlement	(666)	—	(3,710)	—	(3,710)
Repurchases of Class A common stock	(1,570)	—	(9,517)	—	(9,517)
Net loss	—	—	—	(3,290)	(3,290)
Balance at March 31, 2023	396,649	$40	$2,279,253	$(1,451,825)	$827,468
Stock options exercised	204	—	560	—	560
Stock-based compensation	—	—	21,354	—	21,354
Vesting and settlement of restricted stock units	2,148	—	—	—	—
Common stock withheld related to net share settlement	(827)	—	(4,526)	—	(4,526)
Repurchases of Class A common stock	(1,663)	—	(8,920)	—	(8,920)
Issuance of common stock through employee stock purchase plan	161	—	649	—	649
Net income	—	—	—	58,786	58,786
Balance at June 30, 2023	396,672	$40	$2,288,370	$(1,393,039)	$895,371

See accompanying notes to condensed consolidated financial statements.

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GoodRx Holdings, Inc.

Condensed Consolidated Statements of Cash Flows

(Unaudited)


	Six Months Ended June 30,
(in thousands)	2024	2023
Cash flows from operating activities
Net income	$5,685	$55,496
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	32,907	31,036
Amortization of debt issuance costs	1,663	1,695
Non-cash operating lease expense	1,930	2,055
Stock-based compensation expense	51,686	43,396
Deferred income taxes	—	(62,980)
Loss on operating lease assets	—	374
Loss on minority equity interest investment	—	1,808
Changes in operating assets and liabilities
Accounts receivable	(18,166)	(6,237)
Prepaid expenses and other assets	(5,981)	(13,574)
Accounts payable	(18,017)	(10,972)
Accrued expenses and other current liabilities	1,973	18,418
Operating lease liabilities	(1,770)	(665)
Other liabilities	377	2,304
Net cash provided by operating activities	52,287	62,154
Cash flows from investing activities
Purchase of property and equipment	(675)	(440)
Capitalized software	(37,169)	(28,807)
Net cash used in investing activities	(37,844)	(29,247)
Cash flows from financing activities
Payments on long-term debt	(5,273)	(3,515)
Repurchases of Class A common stock (1)	(153,226)	(18,437)
Proceeds from exercise of stock options	11,772	1,267
Employee taxes paid related to net share settlement of equity awards	(15,966)	(8,048)
Proceeds from employee stock purchase plan	857	649
Net cash used in financing activities	(161,836)	(28,084)
Net change in cash and cash equivalents	(147,393)	4,823
Cash and cash equivalents
Beginning of period	672,296	757,165
End of period	$524,903	$761,988
Supplemental disclosure of cash flow information
Non cash investing and financing activities:
Stock-based compensation included in capitalized software	$8,090	$6,221
Capitalized software included in accounts payable and accrued expenses and other current liabilities	4,628	4,232
Capitalized software transferred from prepaid assets	—	5,751

See accompanying notes to condensed consolidated financial statements.

_____________________________________________________

(1)Repurchases of Class A common stock for the six months ended June 30, 2024 include 20.9 million shares

repurchased from related parties (after giving effect to the automatic conversion of Class B common stock to Class

A common stock upon such repurchase) for an aggregate consideration of $151.4 million. See "Note 9.

Stockholders' Equity" for additional information.

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GoodRx Holdings, Inc.

Notes to Condensed Consolidated Financial Statements

(Unaudited)

1. Description of Business

GoodRx Holdings, Inc. was incorporated in September 2015 and has no material assets or standalone operations other

than its ownership in its consolidated subsidiaries. GoodRx, Inc. (“GoodRx”), a Delaware corporation initially formed in

September 2011, is a wholly-owned subsidiary of GoodRx Intermediate Holdings, LLC, which itself is a wholly-owned

subsidiary of GoodRx Holdings, Inc.

GoodRx Holdings, Inc. and its subsidiaries (collectively, "we," "us" or "our") offer information and tools to help

consumers compare prices and save on their prescription drug purchases. We operate a price comparison platform that

provides consumers with curated, geographically relevant prescription pricing, and provides access to negotiated prices

through our codes that can be used to save money on prescriptions across the United States. These services are free to

consumers and we primarily earn revenue from our core business from pharmacy benefit managers ("PBMs") that manage

formularies and prescription transactions including establishing pricing between consumers and pharmacies. We also offer

other healthcare products and services, including pharmaceutical ("pharma") manufacturer solutions, subscriptions and

telehealth services.

2. Summary of Significant Accounting Policies

Basis of Presentation

The accompanying unaudited condensed consolidated financial statements have been prepared in conformity with

accounting principles generally accepted in the United States (“GAAP”) and applicable rules and regulations of the

Securities and Exchange Commission (“SEC”) regarding interim financial information. Certain information and disclosures

normally included in our annual consolidated financial statements prepared in accordance with GAAP have been condensed

or omitted. Accordingly, these condensed consolidated financial statements should be read in conjunction with our audited

consolidated financial statements for the year ended December 31, 2023 and the related notes, which are included in our

Annual Report on Form 10-K filed with the SEC on February 29, 2024 ("2023 10-K"). The December 31, 2023 condensed

consolidated balance sheet was derived from our audited consolidated financial statements as of that date. The condensed

consolidated financial statements include, in the opinion of management, all adjustments, consisting of normal and recurring

items, necessary for the fair statement of our condensed consolidated financial statements. The operating results for the

three and six months ended June 30, 2024 are not necessarily indicative of the results expected for the full year ending

December 31, 2024.

There have been no material changes in significant accounting policies during the three and six months ended June 30,

2024 from those disclosed in “Note 2. Summary of Significant Accounting Policies” in the notes to our consolidated financial

statements included in our 2023 10-K.

Principles of Consolidation

The condensed consolidated financial statements include the accounts of GoodRx Holdings, Inc., its wholly owned

subsidiaries and variable interest entities for which we are the primary beneficiary. Intercompany balances and transactions

have been eliminated in consolidation.

Use of Estimates

The preparation of the condensed consolidated financial statements in conformity with GAAP requires management to

make estimates and assumptions that affect the amounts reported in the condensed consolidated financial statements,

including the accompanying notes. We base our estimates on historical factors; current circumstances; macroeconomic

events and conditions; and the experience and judgment of our management. We evaluate our estimates and assumptions

on an ongoing basis. Actual results can differ materially from these estimates, and such differences can affect the results of

operations reported in future periods.

Certain Risks and Concentrations

Financial instruments that potentially subject us to significant concentrations of credit risk consist principally of cash,

cash equivalents and accounts receivable.

We maintain cash deposits with multiple financial institutions in the United States which, at times, may exceed federally

insured limits. Cash may be withdrawn or redeemed on demand. We believe that the financial institutions that hold our cash

are financially sound and, accordingly, minimal credit risk exists with respect to these balances. However, market conditions

can impact the viability of these institutions. In the event of failure of any of the financial institutions where we maintain our

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cash and cash equivalents, there can be no assurance that we will be able to access uninsured funds in a timely manner or

at all. We have not experienced any losses in such accounts.

We consider all short-term, highly liquid investments purchased with an original maturity of three months or less at the

date of purchase to be cash equivalents. Cash equivalents, consisting of U.S. treasury securities money market funds, of

$485.5 million and $605.5 million at June 30, 2024 and December 31, 2023, respectively, were classified as Level 1 of the

fair value hierarchy and valued using quoted market prices in active markets.

We extend credit to our customers based on an evaluation of their ability to pay amounts due under contractual

arrangements and generally do not obtain or require collateral. For each of the three and six months ended June 30, 2024,

one customer accounted for 11% of our revenue. For each of the three and six months ended June 30, 2023, two customers

accounted for 14% and 11% of our revenue. At June 30, 2024, one customer accounted for 14% of our accounts receivable

balance. At December 31, 2023, no customer accounted for more than 10% of our accounts receivable balance.

Equity Investments

We retain minority equity interests in privately-held companies without readily determinable fair values. Our ownership

interests are less than 20% of the voting stock of the investees and we do not have the ability to exercise significant

influence over the operating and financial policies of the investees. The equity investments are accounted for under the

measurement alternative in accordance with Accounting Standards Codification ("ASC") 321, Investments – Equity

Securities, which is cost minus impairment, if any, plus or minus changes resulting from observable price changes. Due to

indicators of a decline in the financial condition of one of our investees, we recognized a $1.8 million impairment loss on one

of our minority equity interest investments during the three months ended March 31, 2023 and presented as other expense

on our condensed consolidated statement of operations for the six months ended June 30, 2023. We otherwise have not

recognized any changes resulting from observable price changes or impairment losses on our minority equity interest

investments during the three and six months ended June 30, 2024 and 2023. Equity investments included in other assets on

our condensed consolidated balance sheets as of June 30, 2024 and December 31, 2023 were $15.0 million.

Recent Accounting Pronouncements

In December 2023, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU")

2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures. This ASU is intended to enhance the

transparency and decision usefulness of income tax disclosures. The amendments in this ASU address investor requests for

enhanced income tax information primarily through changes to the rate reconciliation and income taxes paid information.

This ASU applies to all public entities and will be effective for fiscal years beginning after December 15, 2024, and for interim

periods for fiscal years beginning after December 15, 2025. Early adoption of this ASU is permitted. We are currently

evaluating the impact of the adoption of this ASU on our consolidated financial statement disclosures.

In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable

Segment Disclosures. The ASU expands public entities’ segment disclosures by requiring disclosure of significant segment

expenses that are regularly provided to the chief operating decision maker and included within each reported measure of

segment profit or loss, an amount and description of its composition for other segment items, and interim disclosures of a

reportable segment’s profit or loss and assets. All disclosure requirements under ASU 2023-07 are also required for public

entities with a single reportable segment. This ASU applies to all public entities that are required to report segment

information in accordance with ASC 280, and is effective for fiscal years beginning after December 15, 2023 and is effective

for interim periods within fiscal years beginning after December 15, 2024. Early adoption of this ASU is permitted. We are

currently evaluating the impact of the adoption of this ASU on our consolidated financial statement disclosures.

3. Prepaid Expenses and Other Current Assets

Prepaid expenses and other current assets consist of the following:


(in thousands)	June 30, 2024	December 31, 2023
Insurance recovery receivable (1)	$14,900	$12,900
Income taxes receivable	12,904	3,537
Reimbursable third-party payments (2)	14,186	15,481
Other prepaid expenses and other current assets (3)	21,888	24,968
Total prepaid expenses and other current assets	$63,878	$56,886

_____________________________________________________

(1)Represents a receivable for the probable recovery related to an incurred loss in connection with certain

contingencies. Loss recoveries are recognized when a loss has been incurred and the recovery is probable. This

determination is based on our analysis of the underlying insurance policies, historical experience with insurers, and

ongoing review of the solvency of insurers, among other factors.

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(2)Represents payments we make to third parties on behalf of, and reimbursable from, certain customers.

(3)Other current assets were not material as of June 30, 2024 and December 31, 2023.

4. Accrued Expenses and Other Current Liabilities

Accrued expenses and other current liabilities consist of the following:


(in thousands)	June 30, 2024	December 31, 2023
Accrued bonus and other payroll related	$17,743	$30,401
Accrued legal settlement	27,500	12,500
Accrued marketing	13,607	10,650
Deferred revenue	5,988	7,105
Other accrued expenses	8,334	10,673
Total accrued expenses and other current liabilities	$73,172	$71,329

Deferred revenue represents payments received in advance of providing services for certain advertising contracts with

customers and subscriptions. We expect substantially all of the deferred revenue at June 30, 2024 will be recognized as

revenue within the subsequent twelve months. Of the $7.1 million of deferred revenue at December 31, 2023, $1.0 million

and $6.4 million was recognized as revenue during the three and six months ended June 30, 2024, respectively. Revenue

recognized during the three and six months ended June 30, 2023 of $1.3 million and $7.0 million, respectively, was included

as deferred revenue at December 31, 2022.

5. Income Taxes

We generally calculate income taxes in interim periods by applying an estimated annual effective income tax rate to

income or loss before income taxes and by calculating the tax effect of discrete items recognized during such periods. Our

estimated annual effective income tax rate is based on our estimated full year income or loss and the related income taxes

for each jurisdiction in which we operate. This rate can be affected by estimates of full year pre-tax income or loss and

permanent differences.

The effective income tax rate for the three months ended June 30, 2024 and 2023 was 42.5% and (387.1%),

respectively. The effective income tax rate for the six months ended June 30, 2024 and 2023 was 52.4% and (254.3%),

respectively. The primary differences between our effective income tax rates and the federal statutory tax rate for the three

and six months ended June 30, 2024 and 2023 were due to the effects of non-deductible officers’ stock-based compensation

expense, state income taxes, benefits from research and development tax credits, and tax effects from our equity awards.

The effective income tax rate for the three and six months ended June 30, 2023 was further impacted by the release of our

valuation allowance against the majority of our net deferred tax assets recorded as a discrete tax benefit during the three

months ended June 30, 2023.

6. Debt

As of June 30, 2024, our First Lien Credit Agreement (as amended from time to time, the "Credit Agreement") provided

for (i) a $700.0 million term loan maturing on October 10, 2025 (“First Lien Term Loan Facility”); and (ii) a revolving credit

facility for up to $100.0 million (the “Revolving Credit Facility”) maturing on July 11, 2025. As of June 30, 2024, there were no

changes to the terms of our First Lien Term Loan Facility and Revolving Credit Facility as disclosed in Note 12 to our

consolidated financial statements included in our 2023 10-K.

The effective interest rate on the First Lien Term Loan Facility for the three months ended June 30, 2024 and 2023 was

8.75% and 8.37%, respectively. The effective interest rate on the First Lien Term Loan Facility for the six months ended June

30, 2024 and 2023 was 8.76% and 8.09%, respectively.

We had no borrowings against the Revolving Credit Facility as of June 30, 2024 and December 31, 2023.

We had outstanding letters of credit issued against the Revolving Credit Facility for $8.3 million and $9.2 million as of

June 30, 2024 and December 31, 2023, respectively, which reduces our available borrowings under the Revolving Credit

Facility.

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Our debt balance is as follows:


(in thousands)	June 30, 2024	December 31, 2023
Principal balance under First Lien Term Loan Facility	$656,524	$661,797
Less: Unamortized debt issuance costs and discounts	(3,847)	(5,307)
	$652,677	$656,490

The estimated fair value of our debt approximated its carrying value as of June 30, 2024 and December 31, 2023,

based on inputs categorized as Level 2 in the fair value hierarchy.

Under the Credit Agreement, we are subject to a financial covenant requiring maintenance of a First Lien Net Leverage

Ratio (as defined in the Credit Agreement) not to exceed 8.2 to 1.0 only in the event that the amounts outstanding under the

Revolving Credit Facility exceed a specified percentage of commitments under the Revolving Credit Facility, and other

nonfinancial covenants under the Credit Agreement. At June 30, 2024, we were in compliance with our covenants.

On July 10, 2024, we entered into the Sixth Amendment to First Lien Credit Agreement (the "Sixth Amendment") to,

among other things, (i) establish a new $500.0 million term loan (the “2024 Term Loan”) with a maturity date of July 10,

2029, (ii) extend the maturity date on $88.0 million of the total $100.0 million Revolving Credit Facility to April 10, 2029 and

(iii) immaterially modify certain covenants. The $12.0 million of revolving commitments not subject to the maturity extension

will terminate on July 11, 2025. Concurrently with the closing of the Sixth Amendment, we repaid outstanding principal and

accrued interest under the First Lien Term Loan Facility in full as well as all premiums, fees and expenses in connection with

the foregoing transactions using all of the proceeds from the 2024 Term Loan and $167.2 million of cash on hand. The 2024

Term Loan and the Revolving Credit Facility are collateralized by substantially all of our assets and 100% of the equity

interest of GoodRx.

The 2024 Term Loan bears interest, at our option, at either (i) a term rate based on the Secured Overnight Financing

Rate, subject to a “floor” of 0.00%, plus a margin of 3.75%; or (ii) an alternate base rate plus a margin of 2.75%. Interest is

paid monthly. The 2024 Term Loan was funded with an original issue discount at 99.0% of the principal amount thereof. The

2024 Term Loan requires quarterly principal payments of $1.3 million beginning with the quarter ending March 31, 2025, with

any remaining unpaid principal and any accrued interest due upon maturity. We may make voluntary prepayments of the

2024 Term Loan from time to time, and we are required in certain instances related to asset dispositions, casualty events,

non-permitted debt issuances and annual excess cash flow, to make mandatory prepayments of the 2024 Term Loan.

7. Commitments and Contingencies

Aside from the below, as of June 30, 2024, there were no material changes to our commitments and contingencies as

disclosed in the notes to our consolidated financial statements included in our 2023 10-K.

Between February 2, 2023, and March 30, 2023, five individual plaintiffs filed five separate putative class actions

lawsuits against Google, Meta, Criteo and us, alleging generally that we have not adequately protected consumer privacy

and that we communicated consumer information to third parties, including the three co-defendants. Four of the plaintiffs

allege common law intrusion upon seclusion and unjust enrichment claims, as well as claims under California’s

Confidentiality of Medical Information Act, Invasion of Privacy Act, Consumer Legal Remedies Act, and Unfair Competition

Law. One of these four plaintiffs additionally brings a claim under the Electronic Communications Privacy Act. The fifth

plaintiff brings claims for common-law unjust enrichment and violations of New York’s General Business Law. Four of these

cases were originally filed in the United States District Court for the Northern District of California ("NDCA) (Cases No. 3:23-

cv-00501; 3:23-cv-00744; 3:23-cv-00940; and 4:23-cv-01293). One case was originally filed in the United States District

Court for the Southern District of New York (Case No. 1:23-cv-00943); however, that case was voluntarily dismissed and re-

filed in the NDCA (Case No. 3:23-cv-01508). These five matters have been consolidated and assigned to U.S. District Judge

Araceli Martínez-Olguín in the NDCA. The court also set a briefing schedule for filing a single consolidated complaint, which

the plaintiffs filed on May 21, 2023 (Case No. 3:23-cv-00501-AMO; the "NDCA Class Action Matter"), as well as motions to

dismiss and motions to compel arbitration. In addition to the aforementioned claims, the plaintiffs in the now consolidated

matter bring claims under the Illinois Consumer Fraud and Deceptive Business Practices Act, common law negligence and

negligence per se, in each case, pleaded in the alternative. The plaintiffs are seeking various forms of monetary damages

(such as statutory damages, compensatory damages, attorneys’ fees and disgorgement of profits) as well as injunctive

relief. Briefing on the motions to dismiss and motions to compel arbitration was completed on August 24, 2023.

On October 27, 2023, six plaintiffs filed a class action complaint (Case No. 1:23-cv-24127-BB; the “SDFL Class Action

Matter”) against us in the United States District Court for the Southern District of Florida ("SDFL"). The plaintiffs alleged, on

behalf of the same nationwide class as the NDCA Class Action Matter, substantially the same statutory and common law

violation claims as alleged in that matter as well as claims based on the federal Electronic Communications Privacy Act,

invasion of privacy under California common law and the California constitution, invasion of privacy under New Jersey's

Constitution, and violations of Pennsylvania’s Wiretapping and Electronic Surveillance Control Act, Florida’s Security of

Communications Act, New York’s Civil Rights Law and Stop Hack and Improve Electronic Data Security Act. The plaintiffs in

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the SDFL Class Action Matter seek various forms of monetary damages as well as injunctive and other unspecified equitable

relief.

On October 27, 2023, we entered into a proposed settlement agreement with the plaintiffs in the SDFL Class Action

Matter, on behalf of a nationwide settlement class that includes the NDCA Class Action Matter, which provides for a payment

of $13.0 million by us. On October 30, 2023, the plaintiffs in the SDFL Class Action Matter filed a motion and memorandum

in support of preliminary approval of the proposed class action settlement and, on October 31, 2023, the SDFL granted

preliminary approval of the proposed settlement. The proposed settlement is subject to final approval of the court. Members

of the class have the opportunity to opt-out of the class and commence their own actions.

In response to the proposed settlement in the SDFL Class Action Matter, plaintiffs in the NDCA Class Action Matter filed

(i) on November 1, 2023, a motion in the NDCA for an order to require us to cease litigation of, or alternatively file a motion

to stay in, the SDFL Class Action Matter and enjoin us from seeking settlement with counsel other than plaintiffs’ counsel in

the NDCA Class Action Matter; and (ii) on November 2, 2023, a motion in the SDFL for that court to allow them to intervene

and appear in the SDFL action, transfer the SDFL Class Action Matter to the NDCA and reconsider and deny its preliminary

approval of the proposed settlement. The SDFL has issued an order requiring the SDFL plaintiffs to, among other things, file

a response to the NDCA plaintiffs' motion to intervene. Additionally, U.S. District Judge Araceli Martínez-Olguín in the NDCA

issued an order for us to show cause as to why we should not be sanctioned for an alleged failure to provide notification to

the NDCA of the pendency of the SDFL Class Action Matter. We filed our written response to this order on November 8,

2023. The NDCA held a hearing on November 14, 2023, and ordered parties to the litigation to participate in mediation. The

parties participated in mediation on January 10, 2024, and have agreed to participate in an additional day of mediation,

which occurred on March 7, 2024. Negotiations between the parties remain ongoing.

Based on the proposed settlement agreement, we determined that an estimated $13.0 million loss was probable and

accrued $12.5 million as of December 31, 2023, which was net of an initial $0.5 million payment to a third party qualified

settlement fund that we do not own, which will be disbursed to the plaintiffs if required conditions are satisfied. Based on

ongoing negotiations and mediation between the parties, we determined the estimated probable loss to be $28.0 million as

of March 31, 2024 and June 30, 2024. The $27.5 million estimated net liability was accrued within accrued expenses and

other current liabilities on our condensed consolidated balance sheet as of June 30, 2024. While this amount represents our

best judgment of the probable loss based on the information currently available to us, it is subject to significant judgments

and estimates and numerous factors beyond our control, including, without limitation, final approval of the court or the results