GoodRx reported falling revenue for the fourth quarter, but its stock rallied early Wednesday after beating earnings expectations.
The company, best known for its drug cost transparency tools, reported $184.1 million in revenue for Q4 compared with $213.3 million in the prior-year period. Net loss for the quarter was $2 million compared to $39.9 million last year, which the company said was due to a decrease in their provision for income taxes.
GoodRx reported its prescription transactions revenue decreased 19% to $129.4 million, driven by an decrease in monthly active consumers and a shift to other retailers due to a previously mentioned issue with a large grocery chain rumored to be Kroger. The company said the impact of the problem on prescription transactions was about $40 to $50 million in the fourth quarter.
Pharma manufacturer solutions revenue also decreased 23% to $24.9 million, though subscription revenue rose 42% to $24.6 million, which the company attributed primarily to an increase in subscription fees for GoodRx Gold. Other revenue increased 8% to $5.2 million, driven by a growing number of telehealth visits.
Product development and technology expenses stayed relatively flat, though sales and marketing expenses and general and administrative expenses declined.
For the full year, GoodRx reported revenue of $766.6 million and a net loss of $32.81 million. In 2021, the company posted $745.4 million in revenue and a $25.3 million net loss.
“While there is much to be proud of in advancing our mission, 2022 was not the year we anticipated in terms of financial performance. The grocer issue that began in the first half of the year impacted us significantly, we haven’t yet recouped the volume loss resulting from that event,” Doug Hirsch co-CEO and cofounder of GoodRx, said during an earnings call. “But our resourceful team used this event as an opportunity to take actions to make the business more resilient, and we exited the year with results that were better than our expectations following the grocer issue.”
GoodRx expects $181 million to $183 million in revenue for the first quarter and $780 million to $790 million for the full year.
THE LARGER TREND
Last month, the Federal Trade Commission alleged GoodRx had shared consumers’ personal health information with third parties like Google and Facebook for advertising purposes. The company agreed to pay a $1.5 million fine to settle the case, but admitted no wrongdoing.
It laid off about 16% of its workforce in the fall, primarily affecting its technology-focused and marketing segments.