GoodRx Holdings, Inc.: Form 10-Q for the period ended Mar 31, 2025

You should read the following discussion and analysis of our financial condition and results of operations together with

our unaudited condensed consolidated financial statements and related notes included elsewhere in this Quarterly Report

on Form 10-Q, as well as Part II, Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of

Operations” and Part II, Item 8, “Financial Statements and Supplementary Data” included in our Annual Report on Form 10-

K for the fiscal year ended December 31, 2024 filed with the Securities and Exchange Commission ("SEC") on February 27,

2025 (“2024 10-K”). This discussion contains forward-looking statements based upon current plans, expectations and beliefs

involving risks and uncertainties. Our actual results may differ materially from those anticipated in these forward-looking

statements as a result of various factors, including those set forth in the "Risk Factors" sections of our 2024 10-K and this

Quarterly Report on Form 10-Q and other factors set forth in other parts of this Quarterly Report on Form 10-Q and our

filings with the SEC.

Glossary of Selected Terminology

As used in this Quarterly Report on Form 10-Q, unless the context otherwise requires, references to:

• “we,” “us,” “our,” the “Company,” “GoodRx,” and similar references refer to GoodRx Holdings, Inc. and its

consolidated subsidiaries.

• “Co-Founders” refers to Trevor Bezdek, our Co-Chairman and a director of the Company, and Douglas Hirsch,

a director of the Company.

• “consumers” refer to the general population in the United States that uses or otherwise purchases healthcare

products and services. References to “our consumers” or “GoodRx consumers” refer to consumers that

have used one or more of our offerings.

• “discounted price” refers to a price for a prescription provided on our platform that represents a negotiated

rate provided by one of our PBM partners at a retail pharmacy or under a direct contract with one of our

partner pharmacies. Through our platform, our discounted prices are free to access for consumers by saving a

GoodRx code to their mobile device for their selected prescription and presenting it at the chosen pharmacy.

The term “discounted price” excludes prices we may otherwise source, such as prices from patient assistance

programs for low-income individuals and Medicare prices, and any negotiated rates offered through our

subscription offerings: GoodRx Gold (“Gold”), and Kroger Rx Savings Club powered by GoodRx (“Kroger

Savings”) which sunset in July 2024.

• “GoodRx code” refers to codes that can be accessed by our consumers through our apps or websites or that

can be provided to our consumers directly by healthcare professionals, including physicians and pharmacists,

that allow our consumers free access to our discounted prices or a lower list price for their prescriptions when

such code is presented at their chosen pharmacy.

• “Monthly Active Consumers” refers to the number of unique consumers who have used a GoodRx code to

purchase a prescription medication in a given calendar month and have saved money compared to the list

price of the medication. A unique consumer who uses a GoodRx code more than once in a calendar month to

purchase prescription medications is only counted as one Monthly Active Consumer in that month. A unique

consumer who uses a GoodRx code in two or three calendar months within a quarter will be counted as a

Monthly Active Consumer in each such month. Monthly Active Consumers do not include subscribers to our

subscription offerings, consumers of our pharma manufacturer solutions offering, or consumers who used our

telehealth offering. When presented for a period longer than a month, Monthly Active Consumers is averaged

over the number of calendar months in such period. For example, a unique consumer who uses a GoodRx

code twice in January, but who did not use our prescription transactions offering again in February or March, is

counted as 1 in January and as 0 in both February and March, thus contributing 0.33 to our Monthly Active

Consumers for such quarter (average of 1, 0 and 0). A unique consumer who uses a GoodRx code in January

and in March, but did not use our prescription transactions offering in February, would be counted as 1 in

January, 0 in February and 1 in March, thus contributing 0.66 to our Monthly Active Consumers for such

quarter. Effective January 1, 2025, Monthly Active Consumers from acquired companies are included

beginning from the acquisition date. Prior to January 1, 2025, Monthly Active Consumers from acquired

companies were only included beginning in the first full quarter following the acquisition.

• "partner pharmacies" refers to select licensed pharmacies with whom we have direct contractual agreements.
• “PBM” refers to a pharmacy benefit manager. PBMs aggregate demand to negotiate prescription medication

prices with pharmacies and pharma manufacturers. PBMs find most of their demand through relationships with

insurance companies and employers. However, nearly all PBMs also have consumer direct or cash network

pricing that they negotiate with pharmacies for consumers who choose to purchase prescriptions outside of

insurance.

• “pharma” is an abbreviation for pharmaceutical.

15

• “savings,” “saved” and similar references refer to the difference between the list price for a particular

prescription at a particular pharmacy and the price paid by the GoodRx consumer for that prescription utilizing

a GoodRx code available through our platform at that same pharmacy. In certain circumstances, we may show

a list price on our platform when such list price is lower than the negotiated price available using a GoodRx

code and, in certain circumstances, a consumer may use a GoodRx code and pay the list price at a pharmacy

if such list price is lower than the negotiated price available using a GoodRx code. We do not earn revenue

from such transactions, but our savings calculation includes an estimate of the savings achieved by the

consumer because our platform has directed the consumer to the pharmacy with the low list price. This

estimate of savings when the consumer pays the list price is based on internal data and is calculated as the

difference between the average list price across all pharmacies where GoodRx consumers paid the list price

and the average list price paid by consumers in the pharmacies to which we directed them. We do not

calculate savings based on insurance prices as we do not have information about a consumer’s specific

coverage or price. We do not believe savings are representative or indicative of our revenue or results of

operations.

• “subscribers” and similar references refers to our consumers that are subscribed to either of our subscription

offerings, Gold or Kroger Savings (which sunset in July 2024). References to subscription plans as of a

particular date represents an active subscription to either one of our aforementioned subscription offerings as

of the specified date. Each subscription plan may represent more than one subscriber since family subscription

plans may include multiple members.

Certain monetary amounts, percentages, and other figures included in this Quarterly Report on Form 10-Q have been

subject to rounding adjustments. Percentage amounts included in this Quarterly Report on Form 10-Q have not in all cases

been calculated on the basis of such rounded figures, but on the basis of such amounts prior to rounding. For this reason,

percentage amounts in this Quarterly Report on Form 10-Q may vary from those obtained by performing the same

calculations using the figures in our condensed consolidated financial statements included elsewhere in this Quarterly

Report on Form 10-Q. Certain other amounts that appear in this Quarterly Report on Form 10-Q may not sum due to

rounding.

Overview

Our mission is to help Americans get the healthcare they need at a price they can afford. To achieve this, we are

building the leading consumer-focused digital healthcare platform in the United States. Copays on prescription medication

have continued to trend upward in recent years and we believe as insurance providers continue to shift the cost burden

more and more to consumers, consumers are now more than ever searching for sustainable and affordable healthcare

solutions which we believe strengthens our value proposition. We believe our financial results reflect the significant market

demand for our offerings and the value that we provide to the broader healthcare ecosystem.

We have seen rapid changes in the U.S. retail pharmacy landscape recently with announcements of store closures and

reduction of footprint from various retail pharmacies, including Rite Aid and Walgreens. Additionally, in early May 2025, Rite

Aid announced its plan to pursue a sale of substantially all of its assets through a voluntary bankruptcy process. Given the

timing of this announcement, the estimated immediate impact of this plan on our revenue is not yet known, however,

revenue through Rite Aid is currently forecasted to be less than 5% of our total revenue in 2025. Future store closures and

reduction of footprint from retail pharmacies are expected to have an immediate adverse impact on our prescription volume

and prescription transactions revenue. However, we believe this impact to be largely transient as we expect prescription

volume to migrate to other in-network pharmacies in the near term. As an extension of the changing retail pharmacy

landscape, we have seen and continue to expect heightened renegotiations between pharmacies and PBMs, including

changes in retailer reimbursement models, as a result of the pharmacies' increased focus on rationalizing their spending,

which in turn has had and may continue to have an impact on our prescription transactions revenue.

For the three months ended March 31, 2025 as compared to the same period of 2024:

• Revenue increased 3% to $203.0 million from $197.9 million;
• Net income and net income margin were $11.1 million and 5.4%, respectively, compared to net loss and net

loss margin of $1.0 million and 0.5%, respectively; and

• Adjusted EBITDA and Adjusted EBITDA Margin were $69.8 million and 34.4%, respectively, compared to $62.8

million and 31.7%, respectively.

Revenue, net income (loss) and net income (loss) margin are financial measures prepared in conformity with

accounting principles generally accepted in the United States ("GAAP"). Adjusted EBITDA and Adjusted EBITDA Margin are

non-GAAP financial measures. For a reconciliation and presentation of Adjusted EBITDA and Adjusted EBITDA Margin to

the most directly comparable GAAP financial measures, information about why we consider Adjusted EBITDA and Adjusted

EBITDA Margin useful and a discussion of the material risks and limitations of these measures, please see “Key Financial

and Operating Metrics—Non-GAAP Financial Measures" below.

16

Key Financial and Operating Metrics

We use Monthly Active Consumers, subscription plans, Adjusted Revenue, Adjusted EBITDA and Adjusted EBITDA

Margin to assess our performance, make strategic and offering decisions and build our financial projections. The number of

Monthly Active Consumers and subscription plans are key indicators of the scale of our consumer base and a gauge for our

marketing and engagement efforts. We believe these operating metrics reflect our scale, growth and engagement with

consumers.

We exited the first quarter of 2025 with over 7 million prescription-related consumers that used GoodRx across our

prescription transactions and subscription offerings. Our prescription-related consumers represent the sum of Monthly Active

Consumers for the three months ended March 31, 2025 and subscribers to our subscription plans as of March 31, 2025.

Monthly Active Consumers

We expect the changes in retail pharmacy reimbursement models as discussed above to result in a year-over-year

decline in Monthly Active Consumers in the near term.

(in millions)

Subscription Plans

Subscription plans through the second quarter of 2024 included subscription plans for Kroger Savings, which sunset in

July 2024.

(in thousands)

Non-GAAP Financial Measures

Adjusted Revenue, Adjusted EBITDA and Adjusted EBITDA Margin are key measures we use to assess our financial

performance and are also used for internal planning and forecasting purposes. We believe Adjusted Revenue, Adjusted

EBITDA and Adjusted EBITDA Margin are helpful to investors, analysts and other interested parties because they can assist

in providing a more consistent and comparable overview of our operations across our historical financial periods. In addition,

these measures are frequently used by analysts, investors and other interested parties to evaluate and assess performance.

We define Adjusted Revenue for a particular period as revenue excluding client contract termination costs associated

with restructuring related activities. We exclude these costs from revenue because we believe they are not indicative of past

or future underlying performance of the business. For the three months ended March 31, 2025 and the full year of 2024,

revenue was equal to Adjusted Revenue.

We define Adjusted EBITDA for a particular period as net income or loss before interest, taxes, depreciation and

amortization, and as further adjusted, as applicable, for acquisition related expenses, stock-based compensation expense,

payroll tax expense related to stock-based compensation, loss on extinguishment of debt, financing related expenses, loss

on operating lease assets, restructuring related expenses, legal settlement expenses, gain on sale of business and other

income or expense, net. These excluded items are either non-cash charges or such that we believe do not represent our

underlying core operating performance and that their exclusion provides investors with a better understanding of the factors

and trends affecting our business. Adjusted EBITDA Margin represents Adjusted EBITDA as a percentage of Adjusted

Revenue.

Adjusted Revenue, Adjusted EBITDA and Adjusted EBITDA Margin are non-GAAP financial measures and are

presented for supplemental informational purposes only and should not be considered as alternatives or substitutes to

financial information presented in accordance with GAAP. These measures have certain limitations in that they do not

include the impact of certain costs that are reflected in our condensed consolidated statements of operations that are

necessary to run our business. Other companies, including other companies in our industry, may not use these measures or

may calculate these measures differently than as presented in this Quarterly Report on Form 10-Q, limiting their usefulness

as comparative measures.

17

The following table presents a reconciliation of net income (loss), the most directly comparable financial measure

calculated in accordance with GAAP, to Adjusted EBITDA, and presents net income (loss) margin, the most directly

comparable financial measure calculated in accordance with GAAP, with Adjusted EBITDA Margin:

(dollars in thousands)

(1) Financing related expenses include third-party fees related to proposed financings.

(2) Acquisition related expenses principally include costs for actual or planned acquisitions including related third-party

fees, legal, consulting and other expenditures, and as applicable, severance costs and retention bonuses to

employees related to acquisitions and change in fair value of contingent consideration. From time to time,

acquisition related expenses may also include similar transaction related costs for business dispositions.

(3) Restructuring related expenses include costs for various workforce optimization and organizational changes to

better align with our strategic goals and future scale including employee severance and other personnel related

costs, contract termination costs, and losses from the disposal of certain technology and certain capitalized

software.

(4) Legal settlement expenses consist of periodic settlement costs for significant and unusual litigation matters.

(5) Loss on operating lease asset represents losses incurred from time to time relating to the impairment or

abandonment of leased office space.

Components of our Results of Operations

For a description of the components of our results of operations, refer to Note 2 to our audited consolidated financial

statements included in our 2024 10-K. In addition, for a description of primary drivers that may cause our revenue, costs and

operating expenses to fluctuate from period to period, including seasonality, refer to Part II, Item 7, “Management’s

Discussion and Analysis of Financial Condition and Results of Operations” included in our 2024 10-K.

18

Results of Operations

The following table sets forth our results of operations for the three months ended March 31, 2025 and 2024:

(dollars in thousands)

Revenue

All of our revenue has been generated in the United States.

Prescription transactions revenue increased $3.5 million, or 2%, year-over-year, primarily driven by improved unit

economics related to contracting with our customers and partners and sales mix, partially offset by a 4% decrease in the

number of our Monthly Active Consumers, primarily due to the broader changes in the retail pharmacy landscape including

store closures and retail reimbursement models as discussed above. Our acquisition of VCRx (see Note 3 to our condensed

consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q) did not materially contribute to

the year-over-year changes in prescription transactions revenue and Monthly Active Consumers.

Subscription revenue decreased $1.6 million, or 7%, year-over-year, primarily driven by a decrease in the number of

subscription plans principally due to the sunset of Kroger Savings with 680 thousand subscription plans as of March 31,

2025 compared to 778 thousand as of March 31, 2024. Given the subscription fee is higher for Gold relative to Kroger

Savings, the sunset of Kroger Savings resulted in a higher year-over-year decline in subscription plans relative to

subscription revenue.

Pharma manufacturer solutions revenue increased $4.1 million, or 17%, year-over-year, driven by organic growth as we

continued to expand our market penetration with pharma manufacturers and other customers. We expect pharma

manufacturer solutions to grow as a percentage of total revenue in the near to medium term as we continue to scale and

expand available services, capabilities and platforms of our pharma manufacturer solutions offering.

19

Costs and Operating Expenses

Cost of revenue, exclusive of depreciation and amortization

Cost of revenue remained relatively flat year-over-year, primarily driven by an increase in processing fees and hosting

costs, substantially offset by a decrease in outsourced personnel costs related to consumer support.

Product development and technology

Product development and technology expenses remained relatively flat year-over-year, primarily driven by an increase

in third-party services and contractors associated with non-capitalizable product development activities, partially offset by a

decrease in payroll and related costs largely due to higher capitalization of such costs related to the development of internal-

use software.

Sales and marketing

Sales and marketing expenses decreased $5.4 million, or 6%, year-over-year, primarily driven by a $2.6 million

decrease in third-party marketing expenses and a $1.9 million decrease in payroll and related expenses largely due to lower

stock-based compensation expense as a result of changes in our employee composition.

General and administrative

General and administrative expenses decreased $11.5 million, or 28%, year-over-year, primarily driven by a net $13.0

million estimated legal settlement loss recognized in the first quarter of 2024 with respect to an ongoing class action litigation

and a $2.4 million decrease in stock-based compensation expense related to awards granted to our Co-Founders in 2020

that fully vested by the end of 2024. The impact of these drivers was partially offset by a $4.4 million impairment loss related

to a leased office space we recognized in the first quarter of 2025.

Depreciation and amortization

Depreciation and amortization expenses increased $5.0 million, or 31%, year-over-year, primarily driven by higher

amortization related to capitalized software due to higher capitalization costs for platform improvements and the introduction

of new products and features.

Interest Income

Interest income decreased by $3.6 million, or 48%, year-over-year, primarily due to lower average balance of cash

equivalents held in U.S. treasury securities money market funds.

Interest Expense

Interest expense decreased by $4.0 million, or 27%, year-over-year, primarily due to lower average debt balances.

Income Taxes

For the three months ended March 31, 2025 and 2024, we had income tax expense of $5.6 million and $1.3 million,

respectively, and an effective income tax rate of 33.7% and 444.4%, respectively. The year-over-year increase in income tax

expense was primarily driven by an increase in income before income taxes and tax effects from our equity awards, partially

offset by a decrease in the estimated annual effective income tax rate.

Liquidity and Capital Resources

Since our inception, we have financed our operations primarily through net cash provided by operating activities, equity

issuances, and borrowings under our long-term debt arrangements. Our principal sources of liquidity are our cash and cash

equivalents and borrowings available under our $100.0 million secured revolving credit facility, of which $12.0 million will

mature on July 11, 2025 and $88.0 million on April 10, 2029. As of March 31, 2025, we had cash and cash equivalents of

$301.0 million and $91.7 million available under our revolving credit facility.

As of March 31, 2025, there were no material changes to our primary short-term and long-term requirements for liquidity

and capital or to our contractual commitments as disclosed in Part II, Item 7, "Management's Discussion and Analysis of

Financial Condition and Results of Operations" of our 2024 10-K. In addition, see Note 12 to our condensed consolidated

financial statements included elsewhere in this Quarterly Report on Form 10-Q for a contractual commitment we entered into

in April 2025.

20

Based on our current conditions, we believe that our net cash provided by operating activities and cash on hand will be

adequate to meet our operating, investing and financing needs for at least the next twelve months from the date of the

issuance of the accompanying unaudited condensed consolidated financial statements. Our future capital requirements will

depend on many factors, including the growth of our business, the timing and extent of investments, sales and marketing

activities, and many other factors as described in Part I, Item 1A, "Risk Factors" of our 2024 10-K.

If necessary, we may borrow funds under our revolving credit facility to finance our liquidity requirements, subject to

customary borrowing conditions. To the extent additional funds are necessary to meet our long-term liquidity needs as we

continue to execute our business strategy, we anticipate that they will be obtained through the incurrence of additional

indebtedness, additional equity financings or a combination of these potential sources of funds; however, such financing

may not be available on favorable terms, or at all. In particular, the current economic uncertainty, including rising inflation,

new or increased tariffs and socio-political events, has resulted in, and may continue to result in, significant disruption of

global financial markets, including rising interest rates, which could reduce our ability to access capital. If we are unable to

raise additional funds when needed or on the terms desired, our business, financial condition and results of operations could

be adversely affected.

Holding Company Status

GoodRx Holdings, Inc. is a holding company that does not conduct any business operations of its own. As a result,

GoodRx Holdings, Inc. is largely dependent upon cash distributions and other transfers from its subsidiaries to meet its

obligations and to make future dividend payments, if any. Our debt arrangements contain covenants restricting payments of

dividends by our subsidiaries, including GoodRx, Inc., unless certain conditions are met. These covenants provide for

certain exceptions for specific types of payments. Based on these restrictions, all of the net assets of GoodRx, Inc. were

restricted pursuant to the terms of our debt arrangements as of March 31, 2025. Since the restricted net assets of GoodRx,

Inc. and its subsidiaries exceed 25% of our consolidated net assets, in accordance with Regulation S-X, see Note 18 to our

consolidated financial statements included in our 2024 10-K for the condensed parent company financial information of

GoodRx Holdings, Inc.

Cash Flows

(in thousands)

Net cash provided by operating activities

The $33.2 million year-over-year decrease in net cash provided by operations was driven by a $48.8 million increase in

cash outflow from changes in operating assets and liabilities, partially offset by a $15.6 million increase in net income after

adjusting for non-cash adjustments. Changes in operating assets and liabilities were principally driven by the timing of

payments of prepaid services, accounts payable and accrued expenses, income tax payments and refunds, as well as

collections of accounts receivable.

Net cash used in investing activities

The $31.3 million year-over-year increase in net cash used in investing activities was primarily driven by a $30.0 million

increase in cash paid for the acquisition of a business.

Net cash used in financing activities

The $56.1 million year-over-year decrease in net cash used in financing activities was primarily driven by a $53.3 million

decrease in payments for repurchases of our Class A common stock, a $3.1 million decrease in employee taxes paid related

to net share settlement of equity awards, and a $2.3 million decrease in payments on our term loans as a result of our

refinancing in July 2024. The impact from these drivers was partially offset by a $2.6 million decrease in proceeds from the

exercise of stock options.

Recent Accounting Pronouncements

Refer to Note 2 to our condensed consolidated financial statements appearing elsewhere in this Quarterly Report on

Form 10-Q.

21

Critical Accounting Policies and Estimates

During the three months ended March 31, 2025, there have been no significant changes to our critical accounting

policies and estimates compared with those disclosed in Part II, Item 7, “Management’s Discussion and Analysis of Financial

Condition and Results of Operations” of our 2024 10-K.

There have been no material changes in our market risk from the disclosure included in Part II, Item 7A, “Quantitative

and Qualitative Disclosures About Market Risk” of our 2024 10-K.

Evaluation of Disclosure Controls and Procedures

Our management, with the participation of our principal executive officer and principal financial officer, evaluated, as of

the end of the period covered by this Quarterly Report on Form 10-Q, the effectiveness of our disclosure controls and

procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act). Based on that evaluation, our principal

executive officer and principal financial officer concluded that, as of March 31, 2025, our disclosure controls and procedures

were effective.

Changes in Internal Control Over Financial Reporting

There have been no changes in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f)

under the Exchange Act) during the three months ended March 31, 2025 that have materially affected, or are reasonably

likely to materially affect, our internal control over financial reporting.

22

For a discussion of potential risks and uncertainties related to us, see the information included in Part I, Item 1A, "Risk

Factors" of our 2024 10-K. There have been no material changes to the risk factors previously disclosed in our 2024 10-K,

except as noted below:

General economic factors, natural disasters or other unexpected events may adversely affect our business,

financial performance and results of operations.

Although we only operate in the United States, our business, financial performance and results of operations depend in

part on worldwide macroeconomic economic conditions and their impact on consumer spending. Recessionary economic

cycles, changing interest rates, volatile fuel and energy costs, inflation, levels of unemployment, conditions in the residential

real estate and mortgage markets, access to credit, consumer debt levels, tariffs, government spending freezes, unsettled

financial markets and other economic factors that may affect costs of manufacturing prescription medications, consumer

spending or buying habits could materially and adversely affect our customers, our consumers, and demand for our

offerings. Volatility in the financial markets and deterioration in economic conditions, increasing inflation or increasing

unemployment levels has also had and may continue to have a negative impact on consumer spending patterns. Changes

and uncertainty can, among other things, reduce or shift spending away from medical treatments, procedures and doctors’

office visits.

In addition, negative national or global economic conditions have adversely affected the PBMs, partner pharmacies and

pharma manufacturers we contract with and their associated industry participants, financial performance, liquidity and

access to capital, and may continue to impact them. This may affect their ability to renew contracts with us on the same or

better terms, which could impact the competitiveness of the discounted prices we are able to offer our consumers. Trade

barriers, duties, tariffs, and retaliatory measures by the U.S. and other governments may impact the pharma manufacturers

we contract with by increasing their costs of business, which could cause them to decrease their marketing spend on our

offerings. All of these factors may be exacerbated by global financial conditions and other geopolitical factors, which could

harm our business, financial condition and results of operations.

Economic factors such as increased insurance and healthcare costs, commodity prices, tariffs, shipping costs, inflation,

higher costs of labor, and changes in or interpretations of other laws, regulations and taxes may also increase our costs and

make our offerings less competitive, increase general and administrative expenses, and otherwise adversely affect our

financial condition and results of operations.

Additionally, global public health crises, natural disasters, such as earthquakes and wildfires, and other adverse weather

and climate conditions, political crises, such as terrorist attacks, war and other political instability or other unexpected

events, could disrupt our operations, internet or mobile networks or the operations of PBMs and their pharmacy networks.

For example, our corporate headquarters and other facilities are located in California, which in the past has experienced

both severe earthquakes and wildfires. Certain of these events may become more frequent or intense as a result of climate

change or other environmental or social pressures. For more information, see our risk factor titled “We are subject to a

series of risks related to climate change” previously disclosed in our 2024 10-K. If any of these events occurs, our business

could be adversely affected.