1 Calculate Q1 2016 NonGAAP gross profit 142627 150760 15560

1) Calculate Q1 2016 Non-GAAP gross profit:

142,627

150,760

155,603

158,893

159,623

2) Calculate Q1 2016 Non-GAAP EBITDA (apply all relevant SBC and nonrecurring adjustments to EBITDA):

34,853

49,898

49,982

49,730

49,940

3) Calculate Q1 2016 Non-GAAP operating income:

10,762

16,964

18,288

23,166

23,208

4) Calculate Q1 2016 Non-GAAP Net Income.

9,815

12,116

12,847

12,889

13,345

AthenaHealth Q1 2016 Non-GAAP disclosures Stock based compensation (SBC) disclosure .$4.843 million of SBC in direct operating (cost of sales) $4.052 million of SBC in selling and marketing .$2.657 million of SBC in R&D; .$3.614 million of SBC in G&A; Nonrecurring items $0.210 million of integration and transaction costs in G&A; $1.264 million restructuring expenses in R&D; $0.042 million litigation gain allocated to Other Income Amortization .$3.290 million of amortization expense from nonrecurring purchases allocated to direct operating expenses (cost of sales) $2.912 million of amortization expense from nonrecurring purchases allocated to selling and marketing Other Tax Rate on Non-GAAP items: 40%

Solution

1. Q1 Non GAAP Gross Profit:

Revenue from Business Services = 247,529,000

Direct Operating Expenses = 105,389,000 - 4,483,000 = 100,546,000

Gross Profit fro Q1 = 247,529,000 - 100,546,000 = 146,983,000

2. Calculation of EBIDTA:

Net Loss = 833

Income Tax Benefit = 731

Loss before Income Tax Benefit = 1,564

Interest Expense = 1930

Depreciation and Amortisation = 26,774

EBIDTA = 30,268