Accolade Investor Presentation Deck
Reconciliations of Revenue to Adjusted Gross Profit
& Net loss to Adjusted EBITDA
Adjusted Gross Profit is a non-GAAP financial measure that we define as revenue less cost of revenue, excluding depreciation and amortization, and
excluding stock-based compensation and severance costs. We define Adjusted Gross Margin as our Adjusted Gross Profit divided by our revenue. We
believe Adjusted Gross Profit and Adjusted Gross Margin are useful to investors, as they eliminate the impact of certain noncash expenses and allow a
direct comparison of these measures between periods without the impact of noncash expenses and certain other nonrecurring operating expenses.
Adjusted EBITDA is a non-GAAP financial measure that we define as net loss adjusted to exclude interest expense (income), net, income tax expense
(benefit), depreciation and amortization, stock-based compensation, acquisition and integration-related costs, goodwill impairment, change in fair value of
contingent consideration, severance costs, and other expense (income). We believe Adjusted EBITDA provides investors with useful information on period-
to-period performance as evaluated by management and comparison with our past financial performance. We believe Adjusted EBITDA is useful in
evaluating our operating performance compared to that of other companies in our industry, as this measure generally eliminates the effects of certain items
that may vary from company to company for reasons unrelated to overall operating performance.
Adjusted Gross Profit, Adjusted Gross Margin and Adjusted EBITDA have certain limitations, including that they exclude the impact of certain non-cash
charges, such as depreciation and amortization, whereas underlying assets may need to be replaced and result in cash capital expenditures, and stock-
based compensation expense, which is a recurring charge. These non-GAAP financial measures may also not be comparable to similarly titled measures of
other companies because they may not calculate such measures in the same manner, limiting their usefulness as comparative measures. In evaluating these
non-GAAP financial measures, you should be aware that in the future we expect to incur expenses similar to the adjustments in this presentation. Our
presentation of non-GAAP financial measures should not be construed as an inference that our future results will be unaffected by these expenses or any
unusual or nonrecurring items. When evaluating our performance, you should consider these non-GAAP financial measures alongside other financial
performance measures, including the most directly comparable GAAP measures set forth in the reconciliation tables below and our other GAAP results.
The following tables present, for the periods indicated, reconciliation of our revenue to Adjusted Gross Profit and net loss to Adjusted EBITDA.
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