Sharecare (SHCR) concludes strategic review, announces share repurchase program

Sharecare (Nasdaq: SHCR), the digital health company that helps people manage all their health in one place, today announced that its Board of Directors has completed the strategic review process initiated in August 2022.

After evaluating a number of alternatives with the support of advisors, the Board unanimously concluded that the best way to maximize value for shareholders at this time is to continue executing on the Company’s strategic plan to drive growth and efficiencies across all three of its complementary business channels. Highlighting its confidence in Sharecare’s long-term strategy and strong balance sheet and belief that the Company’s shares represent an attractive investment opportunity, the Board has re-authorized a $50 million stock repurchase program.

“The significant interest we received during our strategic review process not only confirmed the fundamental value of each of our business channels but, more importantly, that they are, in fact, all together better,” said Jeff Arnold, chairman and CEO of Sharecare. “Our complementary capabilities, data, unified platform, and expansive customer base deliver a differentiated ecosystem for our users and clients, as well as offered the best path forward to maximize value for our shareholders.”

As part of the review, Sharecare’s leadership also is executing an initiative to align and maximize synergies across the Company’s business channels to create integrated cross-sell opportunities, foster value-added, customer-centered relationships, and accelerate long-term revenue growth. This includes:

• Sharecare’s Enterprise platform for comprehensive care solutions – which is currently focused on the employer, health plan, and government sectors – will be actively sold to new markets including health systems, life science companies, and other healthcare stakeholders by providing the Company’s connected care capabilities and extensive product portfolio via Sharecare’s flexible API-as-a-Product architecture.
• Sharecare’s Provider business channel will broaden its focus to offer Health Insight & Data Solutions, which reflect the channel’s expanding customer base across a growing suite of services and extensive datasets, as it is no longer confined to traditional provider interactions given health plan contracts now constitute a large percentage of its revenue. With services that extend into population health data management, analytics, AI, and insight generation, this shift is intended to effectively represent Sharecare’s ability to empower healthcare stakeholders by delivering comprehensive insight and data solutions across the spectrum.
• Sharecare’s Life Sciences business channel will further evolve to offer broader, more robust Customer Activation & Management Solutions. Designed to acquire, engage, educate, and support people in managing their health, this channel’s product suite and capabilities extend beyond pharmaceutical and biotech clients to health plans, employers, and health systems, efficiently driving targeted patient and member acquisition, increasing member enrollments into Sharecare’s offerings, and furthering user engagement by leveraging extensive digital capabilities and its 100 million+ zero party database.

Arnold added, “The further alignment across our company reflects our continued commitment to growth and the evolving needs of our clients. We’re excited about this initiative and the momentum we’re experiencing from investments in our salesforce and innovation which – when combined with our strategic optimization and globalization initiatives – position us to deliver long-term growth and expand adjusted EBITDA margins.”

Justin Ferrero, president and chief financial officer of Sharecare, said, “The strength of our business model, cash position, and debt-free capital structure enables us to opportunistically buy back stock through a repurchase program while retaining a sufficient cash reserve for operational needs and continued innovation. The decision to re-authorize the repurchase program is a direct reflection of our belief that our shares are undervalued.”

Ferrero added, “Further demonstrating the executive team's belief in Sharecare's future and its stock as an attractive investment, we are all participating in a program that allows eligible employees to forgo up to 25% of guaranteed cash salary in exchange for restricted stock units. We look forward to building on our strong first quarter operating performance, which put us well on our way to achieving our full year 2023 revenue and adjusted EBITDA guidance.”

Repurchases under the program may be made at the Company’s discretion from time to time in the open market, in privately negotiated transactions, or by other means, including through the use of trading plans intended to qualify under Rule 10b5-1 under the Securities Exchange Act of 1934, as amended, in accordance with applicable securities laws and other restrictions. The timing and total amount of stock repurchases will depend upon business, economic, and market conditions, corporate and regulatory requirements, prevailing stock prices, and other considerations. The share repurchase program will have a term of 12 months, may be extended, modified, suspended, or discontinued at any time at the Board’s discretion, and does not obligate the Company to acquire any amount of common stock. Authorization for the Company’s previous stock repurchase program expired on December 31, 2022.

Sharecare expects to fund repurchases with existing cash and cash equivalents. The Company had 356,289,293 shares of Common Stock outstanding as of March 31, 2023.

While the strategic review process has been completed, Sharecare plans to continue to look for ways to leverage its ecosystem to pursue attractive strategic opportunities in the ordinary course of business.

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