What happened
Shares of GoodRx Holdings (GDRX +0.39%) were taking a dive today after the prescription drug comparison platform offered weak guidance in its third-quarter earnings report.
As of 12:31 p.m., the stock was down 20.7%.
NASDAQ: GDRX
Key Data Points
So what
Revenue in the quarter declined 4% to $187.3 million, as the company is still dealing with the loss of a large grocery customer earlier in the year. Still, that beat estimates at $185.3 million. It also said that the number of monthly active consumers declined 9%, associated with the loss of that grocer.
Subscription revenue, generated by GoodRx Gold, which offers deeper discounts on drugs, was a bright spot in the quarter, up 63% to $26.5 million, even though subscription plans declined by 6%.
On the bottom line, adjusted EBITDA shrunk from $61.8 million to $52 million, or a margin of 27.8%. Adjusted earnings per share slipped from $0.09 to $0.07, but that beat expectations at $0.04.
CEO Doug Hirsch said:
We are pleased with the progress made in the third quarter, despite near-term challenges. We achieved better-than-expected results and addressed the grocer issue in August. While we continued to see some impact from the grocer issue, as we expected, the third quarter was highlighted by double-digit growth in our subscription and pharma manufacturer solutions platforms.
Now what
Despite those upbeat remarks, GoodRx's guidance was well below expectations.
The company sees revenue of $175 million to $180 million in the fourth quarter, which is down 16% to 18% from the quarter a year ago. That compared to the consensus at $204.2 million. GoodRx also forecast adjusted EBITDA in the low-to-mid 20% range.
The healthcare stock has already fallen sharply this year, but as long as customers and revenue are declining, the stock is likely to keep spiraling.
