– Achieved total revenue growth of nearly
13%, led by Employer Solutions –
– Strong BPaaS revenue growth of roughly 40%
–
– Successful execution of transformational
initiatives driving enhanced profitability and cash flow –
– Over 90% of revenue under contract for
2023 –
Alight, Inc. (NYSE: ALIT), a leading cloud-based provider of
integrated digital human capital and business solutions, today
reported results for the second quarter ended June 30, 2023.
“Alight delivered strong financial performance in the second
quarter with double digit growth across revenue, profitability and
operating cash flow,” said Chief Executive Officer Stephan Scholl.
“Our transformational progress and stable core business enrich our
long-term visibility with over 90% of our 2023 revenue under
contract and an unprecedented $2.5 billion of backlog already under
contract for 2024. We believe the strength of our combined book of
business positions Alight to achieve its profitable growth targets
in 2023 and beyond.”
Second Quarter 2023 Highlights
- Revenue increased 12.7% over the prior year period to $806
million
- Over 90% of projected 2023 revenue under contract at the end of
the second quarter
- Business Process as a Service (BPaaS) revenue grew 39.8% to
$179 million, representing 22.2% of total revenue
- BPaaS bookings on a total contract value (TCV) basis were $149
million, and since the start of 2021, we have delivered BPaaS TCV
bookings of $1.7 billion, ahead of our goal of $1.5 billion by the
end of 2023
- Gross profit of $257 million and gross profit margin of 31.9%
compared to $219 million and 30.6% in the prior year period,
respectively, and adjusted gross profit of $287 million and
adjusted gross profit margin of 35.6% compared to $242 million and
33.8%, in the prior year period, respectively
- Net loss of $72 million compared to net income of $52 million
in the prior year period
- Adjusted EBITDA grew 10.6% over the prior year period to $157
million
- Cash from operations of $162 million in the first half of 2023,
up $44 million or 37.3% from the prior year period
- New wins or expanded relationships with companies including
Maersk, Weis Markets and Siemens Healthineers
Second Quarter 2023 Results
Consolidated Results
Revenue grew 12.7% to $806 million, as compared to $715 million
in the prior year period. The improvement was driven by a 13.5%
increase in Employer Solutions revenue due to increased net
commercial activity, project revenue, and volumes as well as the
impact of our 2022 acquisition, and nearly 10% growth in
Professional Services revenue. Recurring revenues, which comprised
84.7% of total revenue, grew 13.6% to $683 million mainly due to
growth in Employer Solutions revenue.
Gross profit was $257 million or 31.9% of revenue compared to
$219 million, or 30.6% of revenue in the prior year period. The
increase in gross profit was primarily driven by revenue growth as
noted above, partially offset by additional costs associated with
the rise in revenues.
Selling, general and administrative expenses were $193 million,
compared to $157 million in the prior year period. The change was
primarily due to progress made against the previously announced
restructuring program as well as the inclusion of expenses from the
2022 acquisition.
Interest expense was $33 million as compared to $29 million in
the prior year period. The change in expense was primarily due to
higher interest expense on our term loan borrowings due to movement
in market interest rates.
The Company’s loss before income tax expense was $69 million
compared to income before income tax benefit of $43 million in the
prior year period. The change was primarily due to non-operating
fair value remeasurements of financial instruments and the tax
receivable agreement.
Second Quarter 2023 Segment Results
Employer Solutions
Employer Solutions is driven by Alight’s digital, software and
AI-led capabilities and spans total employee wellbeing and
engagement, including integrated benefits administration,
healthcare navigation, financial health, employee wellness and
payroll.
Employer Solutions revenues grew 13.5% to $697 million, as
compared to $614 million in the prior year period, as a result of
increased net commercial activity, project revenue, and volumes as
well as the impact of our 2022 acquisition. Recurring revenue grew
14.3% to $639 million, while project revenue was up 5.5% to $58
million.
Employer Solutions gross profit was $240 million, as compared to
$200 million in the prior year period, up 20%, driven by revenue
growth and lower expenses related to productivity initiatives,
partially offset by employee compensation costs and additional
costs associated with funding growth of current and future
revenues. Employer Solutions adjusted gross profit was $268
million, as compared to $221 million in the prior year period, up
21.3% or $47 million, primarily due to the factors impacting gross
profit above.
Professional Services
Professional Services revenues were up nearly 10% to $100
million as compared to $91 million in the prior year period as a
result of higher recurring revenue and higher project revenue.
Recurring revenue and project revenue rose by $3 million and $6
million, respectively.
Professional Services gross profit was $19 million and adjusted
gross profit was $20 million, both representing a decrease of $1
million compared to the prior year period.
Balance Sheet Highlights
As of June 30, 2023, the Company’s cash and cash equivalents
balance was $271 million, total debt was $2,809 million and total
debt net of cash and cash equivalents was $2,538 million.
The interest rates on the Company’s debt are 84% fixed through
2024 and 60% through 2025. The Company has no debt maturities until
2025.
Business Outlook
The Company's 2023 outlook includes:
- Revenue of $3.47 billion to $3.51 billion (growth of 11% to
12%).
- Adjusted EBITDA of $735 million to $750 million.
- Adjusted diluted EPS of $0.62 to $0.67.
- BPaaS total contract value bookings of $700 million to $900
million.
- Operating Cash Flow Conversion rate of 45-55%.
Reconciliations of the historical financial measures used in
this press release that are not recognized under U.S. generally
accepted accounting principles ("GAAP") are included below. Because
GAAP financial measures on a forward-looking basis are not
accessible, and reconciling information is not available without
unreasonable effort, we have not provided reconciliations for
forward-looking non-GAAP measures. For the same reasons, we are
unable to address the probable significance of the unavailable
information, which could be material to future results.
Management Update
In addition to highlighting its second quarter results, the
Company is also announcing that Katie Rooney, Chief Financial
Officer of Alight will also be assuming the role of Chief Operating
Officer, effective immediately. Katie will continue in her role as
Global CFO and will also focus on the operations of Alight’s
Professional Services segment and Alight’s global payroll
capabilities. With Katie’s expanded role, Jeremy Heaton, previously
Executive Vice President, Financial Planning & Analysis, will
assume the role of Operating CFO and be accountable for many of the
day-to-day responsibilities across the finance function.
Additionally, Cesar Jelvez will depart Alight.
“I am thrilled to cultivate our strong leadership team by
expanding Katie and Jeremy’s roles,” said Scholl. “Adding
operational experience to Katie’s skillset, and elevating Jeremy’s
role deepens the expertise of our executive leadership team and
gives our board, colleagues, shareholders and customers confidence
in our long-term success.”
Earnings Conference Call and Webcast Information
A conference call to discuss the Company’s second-quarter
financial results is scheduled for today, August 1, 2023 at 4:00
p.m. Central Time (5:00 p.m. Eastern Time). Interested parties can
access the live webcast and accompanying presentation materials by
logging on to the Investor Relations section on the Company’s
website at http://investor.alight.com. A replay of the conference
call and the accompanying presentation materials will be available
on the investor relations website for approximately 90 days.
About Alight Solutions
Alight is a leading cloud-based human capital technology and
services provider that powers confident health, wealth and
wellbeing decisions for 36 million people and dependents. Our
Alight Worklife® platform combines data and analytics with a
simple, seamless user experience. Supported by our global delivery
capabilities, Alight Worklife is transforming the employee
experience for people around the world. With personalized,
data-driven health, wealth, pay and wellbeing insights, Alight
brings people the security of better outcomes and peace of mind
throughout life’s big moments and most important decisions. Learn
how Alight unlocks growth for organizations of all sizes at
alight.com.
For more information, please visit www.alight.com.
Forward-Looking Statements
This press release contains forward-looking statements within
the meaning of Section 27A of the Securities Act of 1933, as
amended (the “Securities Act”), and Section 21E of the Securities
Exchange Act of 1934, as amended. These statements include, but are
not limited to, statements related to the expectations regarding
the performance and outlook for Alight’s business, financial
results, liquidity and capital resources, and other non-historical
statements, including statements in the “Business Outlook” section
of this press release. In some cases, these forward-looking
statements can be identified by the use of words such as “outlook,”
“believes,” “expects,” “potential,” “continues,” “may,” “will,”
“should,” “could,” “seeks,” “projects,” “predicts,” “intends,”
“plans,” “estimates,” “anticipates” or the negative version of
these words or other comparable words. Such forward-looking
statements are subject to various risks and uncertainties
including, among others, risks related to declines in economic
activity in the industries, markets, and regions our clients serve,
including as a result of increases in inflation rates or interest
rates or changes in monetary and fiscal policies, recent events
affecting the financial services industry, risks related to the
performance of our information technology systems and networks,
risks related to our ability to maintain the security and privacy
of confidential and proprietary information, risks related to
changes in regulation, including developments on the use of
artificial intelligence and machine learning, and competition in
our industry. Additional factors that could cause Alight’s results
to differ materially from those described in the forward-looking
statements can be found under the section entitled “Risk Factors”
of Alight’s Annual Report on Form 10-K, filed with the Securities
and Exchange Commission (the "SEC") on March 1, 2023, as such
factors may be updated from time to time in Alight's filings with
the SEC, which are, or will be, accessible on the SEC's website at
www.sec.gov. Accordingly, there are or will be important factors
that could cause actual outcomes or results to differ materially
from those indicated in these statements. These factors should not
be construed as exhaustive and should be considered along with
other factors noted in this presentation and in Alight’s filings
with the SEC. Alight undertakes no obligation to publicly update or
review any forward-looking statement, whether as a result of new
information, future developments or otherwise, except as required
by law.
Non-GAAP Financial Measures
The Company refers to certain non-GAAP financial measures in
this press release, including: Adjusted EBITDA, Adjusted EBITDA
Margin, Adjusted Net Income, Adjusted Diluted Earnings Per Share,
Operating Cash Flow Conversion, Adjusted Gross Profit and Adjusted
Gross Profit Margin. Please see below for additional information
and for reconciliations of such non-GAAP financial measures. The
presentation of non-GAAP financial measures is used to enhance our
investors’ and lenders’ understanding of certain aspects of our
financial performance. This discussion is not meant to be
considered in isolation, superior to, or as a substitute for the
directly comparable financial measures prepared in accordance with
GAAP.
Adjusted EBITDA, which is defined as earnings before interest,
taxes, depreciation and intangible amortization adjusted for the
impact of certain non-cash and other items that we do not consider
in the evaluation of ongoing operational performance. Adjusted
EBITDA Margin is defined as Adjusted EBITDA divided by revenue.
Both Adjusted EBITDA and Adjusted EBITDA Margin are non-GAAP
financial measures used by management and our stakeholders to
provide useful supplemental information that enables a better
comparison of our performance across periods as well as to evaluate
our core operating performance.
Adjusted Net Income, which is defined as net income (loss)
attributable to Alight, Inc. adjusted for intangible amortization
and the impact of certain non-cash items that we do not consider in
the evaluation of ongoing operational performance, is a non-GAAP
financial measure used solely for the purpose of calculating
Adjusted Diluted Earnings Per Share.
Adjusted Diluted Earnings Per Share is defined as Adjusted Net
Income divided by the adjusted weighted-average number of shares of
Alight Inc. common stock, diluted. Adjusted Diluted Earnings Per
Share is used by us and our investors to evaluate our core
operating performance and to benchmark our operating performance
against our competitors.
Operating Cash Flow Conversion is defined as cash provided by
operating activities divided by Adjusted EBITDA. Operating Cash
Flow Conversion is used by management and stakeholders to evaluate
our core operating performance.
Adjusted Gross Profit is defined as revenue less cost of
services adjusted for depreciation, amortization and share-based
compensation, and Adjusted Gross Profit Margin is defined as
Adjusted Gross Profit divided by revenue. Management uses Adjusted
Gross Profit and Adjusted Gross Profit Margin as key measures in
making financial, operating and planning decisions and in
evaluating our performance. We believe that presenting Adjusted
Gross Profit and Adjusted Gross Profit Margin is useful to
investors as it eliminates the impact of certain non-cash expenses
and allows a direct comparison between periods.
Condensed Consolidated Statements of
Income (Loss)
(Unaudited)
Three Months Ended June
30
Six Months Ended June
30
(in millions, except per share
amounts)
2023
2022
2023
2022
Revenue
$
806
$
715
$
1,637
$
1,440
Cost of services, exclusive of
depreciation and amortization
528
483
1,083
974
Depreciation and amortization
21
13
40
24
Gross Profit
257
219
514
442
Operating Expenses
Selling, general and administrative
193
157
378
297
Depreciation and intangible
amortization
85
85
170
170
Total operating expenses
278
242
548
467
Operating Income (Loss)
(21
)
(23
)
(34
)
(25
)
Other (Income) Expense
(Gain) Loss from change in fair value of
financial instruments
—
(50
)
25
(63
)
(Gain) Loss from change in fair value of
tax receivable agreement
11
(38
)
19
(43
)
Interest expense
33
29
66
58
Other (income) expense, net
4
(7
)
7
(8
)
Total other (income) expense, net
48
(66
)
117
(56
)
Income (Loss) Before Income Tax
(69
)
43
(151
)
31
Income tax expense (benefit)
3
(9
)
(5
)
(8
)
Net Income (Loss)
(72
)
52
(146
)
39
Net loss attributable to noncontrolling
interests
(5
)
1
(11
)
(1
)
Net (Loss) Income Attributable to
Alight, Inc.
$
(67
)
$
51
$
(135
)
$
40
Earnings Per Share
Basic (net loss) earnings per share
$
(0.14
)
$
0.11
$
(0.28
)
$
0.09
Diluted (net loss) earnings per share
$
(0.14
)
$
0.10
$
(0.28
)
$
0.07
Condensed Consolidated Balance
Sheets
(Unaudited)
June 30,
December 31,
2023
2022
(in millions, except par values)
Assets
Current Assets
Cash and cash equivalents
$
271
$
250
Receivables, net
629
678
Other current assets
297
379
Total Current Assets Before Fiduciary
Assets
1,197
1,307
Fiduciary assets
1,291
1,509
Total Current Assets
2,488
2,816
Goodwill
3,681
3,679
Intangible assets, net
3,713
3,872
Fixed assets, net
358
320
Deferred tax assets, net
9
6
Other assets
523
542
Total Assets
$
10,772
$
11,235
Liabilities and Stockholders'
Equity
Liabilities
Current Liabilities
Accounts payable and accrued
liabilities
$
385
$
508
Current portion of long-term debt, net
25
31
Other current liabilities
324
300
Total Current Liabilities Before
Fiduciary Liabilities
734
839
Fiduciary liabilities
1,291
1,509
Total Current Liabilities
2,025
2,348
Deferred tax liabilities
43
60
Long-term debt, net
2,784
2,792
Long-term tax receivable agreement
603
568
Financial instruments
122
97
Other liabilities
241
281
Total Liabilities
$
5,818
$
6,146
Commitments and Contingencies
Stockholders' Equity
Preferred stock at $0.0001 par value: 1.0
shares authorized, none issued and outstanding
$
—
$
—
Class A Common Stock: $0.0001 par value,
1,000.0 shares authorized; 497.7 and 478.3 issued and outstanding
as of June 30, 2023 and December 31, 2022, respectively
—
—
Class B Common Stock: $0.0001 par value,
20.0 shares authorized; 10.0 issued and outstanding as of June 30,
2023 and December 31, 2022, respectively
—
—
Class V Common Stock: $0.0001 par value,
175.0 shares authorized; 44.1 and 63.5 issued and outstanding as of
June 30, 2023 and December 31, 2022, respectively
—
—
Class Z Common Stock: $0.0001 par value,
12.9 shares authorized; 5.2 and 5.6 issued and outstanding as of
June 30, 2023 and December 31, 2022, respectively
—
—
Treasury stock, at cost (3.1 and 1.5
shares at June 30, 2023 and December 31, 2022, respectively)
(26
)
(12
)
Additional paid-in-capital
4,734
4,514
Retained deficit
(293
)
(158
)
Accumulated other comprehensive income
100
95
Total Alight, Inc. Stockholders'
Equity
$
4,515
$
4,439
Noncontrolling interest
439
650
Total Stockholders' Equity
$
4,954
$
5,089
Total Liabilities and Stockholders'
Equity
$
10,772
$
11,235
Condensed Consolidated Statements of
Cash Flows
(Unaudited)
Six Months Ended June
30
(in millions)
2023
2022
Operating activities:
Net income (loss)
$
(146
)
$
39
Adjustments to reconcile net income (loss)
to net cash provided by operating activities:
Depreciation
50
35
Intangible asset amortization
160
159
Noncash lease expense
11
13
Financing fee and premium amortization
(1
)
(1
)
Share-based compensation expense
75
75
(Gain) loss from change in fair value of
financial instruments
25
(63
)
(Gain) loss from change in fair value of
tax receivable agreement
19
(43
)
Release of unrecognized tax provision
(1
)
—
Deferred tax expense (benefit)
(2
)
(10
)
Other
4
—
Changes in operating assets and
liabilities, net of business combinations:
Accounts receivable
49
(42
)
Accounts payable and accrued
liabilities
(126
)
(49
)
Other assets and liabilities
45
5
Cash provided by operating
activities
$
162
$
118
Investing activities:
Capital expenditures
(89
)
(79
)
Cash used in investing
activities
$
(89
)
$
(79
)
Financing activities:
Net increase (decrease) in fiduciary
liabilities
(218
)
74
Borrowings from banks
—
104
Financing fees
—
(3
)
Repayments to banks
(13
)
(126
)
Principal payments on finance lease
obligations
(13
)
(17
)
Payments on tax receivable agreements
(7
)
—
Tax payment for shares/units withheld in
lieu of taxes
(6
)
(1
)
Deferred and contingent consideration
payments
(4
)
(81
)
Repurchase of shares
(14
)
—
Other financing activities
—
(6
)
Cash provided by (used in) financing
activities
$
(275
)
$
(56
)
Effect of exchange rate changes on
cash, cash equivalents and restricted cash
5
(9
)
Net increase (decrease) in cash, cash
equivalents and restricted cash
(197
)
(26
)
Cash, cash equivalents and restricted
cash at beginning of period
1,759
1,652
Cash, cash equivalents and restricted
cash at end of period
$
1,562
$
1,626
Reconciliation of Net Income (Loss) to
Adjusted EBITDA
(Unaudited)
Three Months Ended June
30
Six Months Ended June
30
(in millions)
2023
2022
2023
2022
Net Income (Loss)
$
(72
)
$
52
$
(146
)
$
39
Interest expense
33
29
66
58
Income tax expense (benefit)
3
(9
)
(5
)
(8
)
Depreciation
26
18
50
35
Intangible amortization
80
80
160
159
EBITDA
70
170
125
283
Share-based compensation
38
42
75
75
Transaction and integration
expenses(1)
8
3
10
9
Restructuring
30
14
56
20
(Gain) Loss from change in fair value of
financial instruments
—
(50
)
25
(63
)
(Gain) Loss from change in fair value of
tax receivable agreement
11
(38
)
19
(43
)
Other(2)
—
1
1
3
Adjusted EBITDA
$
157
$
142
$
311
$
284
Revenue
$
806
$
715
$
1,637
$
1,440
Adjusted EBITDA Margin(3)
19.5
%
19.9
%
19.0
%
19.7
%
(1)
Transaction and integration
expenses primarily relate to acquisition activity.
(2)
Other primarily includes expenses
related to debt financing.
(3)
Adjusted EBITDA Margin is defined
as Adjusted EBITDA as a percentage of revenue.
Reconciliation of Net Income (Loss)
Attributable to Alight, Inc. to Adjusted Net Income and Adjusted
Diluted Earnings per Share
(Unaudited)
Three Months Ended June
30
Six Months Ended June
30
(in millions, except share and per share
amounts)
2023
2022
2023
2022
Numerator:
Net (Loss) Income Attributable to Alight,
Inc.
$
(67
)
$
51
$
(135
)
$
40
Conversion of noncontrolling interest
(5
)
1
(11
)
(1
)
Intangible amortization
80
80
160
159
Share-based compensation
38
42
75
75
Transaction and integration expenses
8
3
10
9
Restructuring
30
14
56
20
(Gain) Loss from change in fair value of
financial instruments
—
(50
)
25
(63
)
(Gain) Loss from change in fair value of
tax receivable agreement
11
(38
)
19
(43
)
Other
—
1
1
3
Tax effect of adjustments(1)
(18
)
(39
)
(51
)
(67
)
Adjusted Net Income
$
77
$
65
$
149
$
132
Denominator:
Weighted average shares outstanding -
basic
490,306,205
457,851,348
483,358,533
457,347,581
Dilutive effect of the exchange of
noncontrolling interest units
—
75,886,716
—
75,886,716
Dilutive effect of RSUs
—
—
—
836,356
Weighted average shares outstanding -
diluted
490,306,205
533,738,064
483,358,533
534,070,653
Exchange of noncontrolling interest
units(2)
44,103,939
—
51,055,250
—
Impact of unvested RSUs(3)
10,109,595
10,791,134
10,109,595
9,954,778
Adjusted shares of Class A Common Stock
outstanding - diluted(4)
544,519,739
544,529,198
544,523,378
544,025,431
Basic (Net Loss) Earnings Per
Share
$
(0.14
)
$
0.11
$
(0.28
)
$
0.09
Diluted (Net Loss) Earnings Per
Share
$
(0.14
)
$
0.10
$
(0.28
)
$
0.07
Adjusted Diluted Earnings Per
Share(4)(5)
$
0.14
$
0.12
$
0.27
$
0.24
(1)
Income tax effects have been
calculated based on the statutory tax rates for both U.S. and
foreign jurisdictions based on the Company's mix of income and
adjusted for significant changes in fair value measurement.
(2)
Assumes the full exchange of the
units held by noncontrolling interests for shares of Class A Common
Stock of Alight, Inc. pursuant to the exchange agreement.
(3)
Includes non-vested time-based
restricted stock units that were determined to be antidilutive for
U.S. GAAP diluted earnings per share purposes.
(4)
Excludes two tranches of
contingently issuable seller earnout shares: (i) 7.5 million shares
will be issued if the Company's Class A Common Stock's
volume-weighted average price ("VWAP") is >$12.50 for 20
consecutive trading days; and (ii) 7.5 million shares will be
issued if the Company's Class A Common Stock VWAP is >$15.00 for
20 consecutive trading days. Both tranches have a seven-year
duration.
(5)
Excludes 30,228,371 and
34,577,418 performance-based units, which represents the gross
number of shares expected to vest based on achievement of
performance conditions as of June 30, 2023 and June 30, 2022,
respectively.
Reconciliation of Segment Profit to
Income (Loss) Before Income Tax Benefit
(Unaudited)
Segment Profit
Three Months Ended June
30
Six Months Ended June
30
(in millions)
2023
2022
2023
2022
Employer Solutions
$
240
$
200
$
478
$
404
Professional Services
19
20
38
39
Other
(2
)
(1
)
(2
)
(1
)
Total Gross Profit
257
219
514
442
Selling, general and administrative
193
157
378
297
Depreciation and intangible
amortization
85
85
170
170
Operating Income (Loss)
(21
)
(23
)
(34
)
(25
)
(Gain) Loss from change in fair value of
financial instruments
-
(50
)
25
(63
)
(Gain) Loss from change in fair value of
tax receivable agreement
11
(38
)
19
(43
)
Interest expense
33
29
66
58
Other (income) expense, net
4
(7
)
7
(8
)
Income (Loss) Before Income Tax
$
(69
)
$
43
$
(151
)
$
31
Gross Profit to Adjusted Gross Profit
Reconciliation by Segment
(Unaudited)
Three Months Ended June 30,
2023
($ in millions)
Employer Solutions
Professional Services
Other
Total
Gross Profit
$
240
$
19
$
(2
)
$
257
Add: stock-based compensation
8
1
—
9
Add: depreciation and amortization
20
—
1
21
Adjusted Gross Profit
$
268
$
20
$
(1
)
$
287
Gross Profit Margin
34.4
%
19.0
%
-22.2
%
31.9
%
Adjusted Gross Profit Margin
38.5
%
20.0
%
-11.1
%
35.6
%
Three Months Ended June 30,
2022
($ in millions)
Employer Solutions
Professional Services
Other
Total
Gross Profit
$
200
$
20
$
(1
)
$
219
Add: stock-based compensation
9
1
—
10
Add: depreciation and amortization
12
—
1
13
Adjusted Gross Profit
$
221
$
21
$
-
$
242
Gross Profit Margin
32.6
%
22.0
%
-10.0
%
30.6
%
Adjusted Gross Profit Margin
36.0
%
23.1
%
0.0
%
33.8
%
Six Months Ended June 30,
2023
($ in millions)
Employer Solutions
Professional Services
Other
Total
Gross Profit
$
478
$
38
$
(2
)
$
514
Add: stock-based compensation
16
2
—
18
Add: depreciation and amortization
38
—
2
40
Adjusted Gross Profit
$
532
$
40
$
-
$
572
Gross Profit Margin
33.7
%
19.2
%
-10.5
%
31.4
%
Adjusted Gross Profit Margin
37.5
%
20.2
%
0.0
%
34.9
%
Six Months Ended June 30,
2022
($ in millions)
Employer Solutions
Professional Services
Other
Total
Gross Profit
$
404
$
39
$
(1
)
$
442
Add: stock-based compensation
16
1
—
17
Add: depreciation and amortization
22
—
2
24
Adjusted Gross Profit
$
442
$
40
$
1
$
483
Gross Profit Margin
32.7
%
21.5
%
-4.5
%
30.7
%
Adjusted Gross Profit Margin
35.7
%
22.1
%
4.5
%
33.5
%
Other Select Financial Data
(Unaudited)
Three Months Ended June
30
Six Months Ended June
30
($ in millions)
2023
2022
2023
2022
Segment Revenues
Employer Solutions:
Recurring
$
639
$
559
$
1,308
$
1,129
Project
58
55
112
108
Total Employer Solutions
697
614
1,420
1,237
Professional Services:
Recurring
35
32
68
62
Project
65
59
130
119
Total Professional Services
100
91
198
181
Total Reportable Segments
797
705
1,618
1,418
Other (1)
9
10
19
22
Total revenue
$
806
$
715
$
1,637
$
1,440
Segment Gross Profit
Employer Solutions
$
240
$
200
$
478
$
404
Professional Services
19
20
38
39
Other
(2
)
(1
)
(2
)
(1
)
Total gross profit
$
257
$
219
$
514
$
442
Segment Gross Margin
Employer Solutions
34.4
%
32.6
%
33.7
%
32.7
%
Professional Services
19.0
%
22.0
%
19.2
%
21.5
%
Other
(22.2
%)
(10.0
%)
(10.5
%)
(4.5
%)
Total gross margin
31.9
%
30.6
%
31.4
%
30.7
%
Segment Adjusted Gross Profit
Employer Solutions
$
268
$
221
$
532
$
442
Professional Services
20
21
40
40
Other
(1
)
—
—
1
Total gross profit
$
287
$
242
$
572
$
483
Segment Adjusted Gross Margin
Percent
Employer Solutions
38.5
%
36.0
%
37.5
%
35.7
%
Professional Services
20.0
%
23.1
%
20.2
%
22.1
%
Other
(11.1
%)
0.0
%
0.0
%
4.5
%
Total adjusted gross margin percent
35.6
%
33.8
%
34.9
%
33.5
%
Adjusted EBITDA
$
157
$
142
$
311
$
284
Cash provided by operating
activities
$
162
$
118
Other Key Statistics
Recurring revenue
$
683
$
601
$
1,395
$
1,213
BPaaS revenue
$
179
$
128
$
350
$
242
BPaaS revenue as % of total revenue
22.2
%
17.9
%
21.4
%
16.8
%
BPaaS bookings(2)
$
149
$
234
$
224
$
356
(1)
Other revenues primarily
attributable to the former Hosted Segment.
(2)
BPaaS bookings are reported on a
total contract value (TCV) basis.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20230801005546/en/
Investors: Jeremy Cohen investor.relations@alight.com
Media: MacKenzie Lucas mackenzie.lucas@alight.com
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