8-K

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

May 6, 2009

Date of Report (Date of earliest event reported)

WEBMD HEALTH CORP.

(Exact name of registrant as specified in its charter)

Delaware	0-51547	20-2783228
(State or other jurisdiction of incorporation)	(Commission File Number)	(I.R.S. Employer Identification No.)

111 Eighth Avenue
New York, New York 10011

(Address of principal executive offices, including zip code)

(212) 624-3700

(Registrant’s telephone number, including area code)

(Former name or address, if changed since last report)

     Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 7.01. Regulation FD Disclosure

     On May 5, 2009, WebMD Health Corp. filed a Current Report on Form 8-K furnishing a May 5, 2009 press release announcing results for the quarter ended March 31, 2009. In that press release, WebMD indicated that it has decided to divest its Little Blue Book print directory business and, accordingly, reflected that business as discontinued operations in the financial statements accompanying the press release, no longer presented a stand-alone publishing segment in its financial statements and began reporting revenue in the following three categories: advertising and sponsorship; licensing; and print. WebMD is furnishing, with this Current Report, certain unaudited financial information for each of the quarters in 2008 and for the year ended December 31, 2008, retroactively reclassifying the Little Blue Book print directory business as discontinued operations and reflecting the changes in segment presentation and revenue reporting described above.

     Exhibits 99.1, 99.2 and 99.3 are being “furnished” and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 (the “Exchange Act”), nor shall any of those exhibits be deemed incorporated by reference in any filing under the Securities Act of 1933 (the “Securities Act”) or the Exchange Act, except as shall be expressly set forth by specific reference in such filing.

Item 9.01. Financial Statements and Exhibits

     (d) Exhibits. The following exhibits are furnished herewith:

Exhibit
Number	Description
99.1	Unaudited Consolidated Statements of Operations of the Registrant for the Quarters ended March 31, 2008, June 30, 2008, September 30, 2008 and December 31, 2008 and for the Year ended December 31, 2008
99.2	Supplemental Non-GAAP Financial Information of the Registrant for the Quarters ended March 31, 2008, June 30, 2008, September 30, 2008 and December 31, 2008 and for the Year ended December 31, 2008
99.3	Explanation of Non-GAAP Financial Measures (Annex A to Exhibit 99.2)

2

SIGNATURE

     Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	WEBMD HEALTH CORP.
Dated: May 6, 2009	By:	/s/ Lewis H. Leicher
		Lewis H. Leicher
		Senior Vice President

3

EXHIBIT INDEX

Exhibit
Number	Description
99.1	Unaudited Consolidated Statements of Operations of the Registrant for the Quarters ended March 31, 2008, June 30, 2008, September 30, 2008 and December 31, 2008 and for the Year ended December 31, 2008
99.2	Supplemental Non-GAAP Financial Information of the Registrant for the Quarters ended March 31, 2008, June 30, 2008, September 30, 2008 and December 31, 2008 and for the Year ended December 31, 2008
99.3	Explanation of Non-GAAP Financial Measures (Annex A to Exhibit 99.2)

EX-99.1

Exhibit 99.1

WebMD Health Corp.

Unaudited Consolidated Statements of Operations of the Registrant

For the Quarters ended March 31, 2008, June 30, 2008, September 30, 2008 and
December 31, 2008 and for the Year ended December 31, 2008

(in thousands, except per share amounts)

	For the quarter ended,										For the year ended
	March 31, 2008			June 30, 2008		September 30, 2008		December 31, 2008			December 31, 2008
Revenue	$	80,650		$	86,004	$	96,797	$	110,091		$	373,542
Costs and expenses:
Cost of operations		30,927			31,968		34,225		38,018			135,138
Sales and marketing		25,149			24,898		26,021		30,012			106,080
General and administrative		13,480			14,211		14,774		14,170			56,635
Depreciation and amortization		6,672			7,087		7,056		7,106			27,921
Interest income		3,453			2,350		2,616		2,033			10,452
Impairment of auction rate securities		27,406			—		—		—			27,406
Restructuring		—			—		—		2,910			2,910
Income (loss) from continuing operations
before income tax provision (benefit)		(19,531	)		10,190		17,337		19,908			27,904
Income tax provision (benefit)		3,432			4,501		7,375		(13,097	)		2,211
Income (loss) from continuing operations		(22,963	)		5,689		9,962		33,005			25,693
Income (loss) from discontinued operations		(372	)		663		804		(86	)		1,009
Net income (loss)	$	(23,335	)	$	6,352	$	10,766	$	32,919		$	26,702
Basic income (loss) per share:
Income (loss) from continuing operations	$	(0.40	)	$	0.10	$	0.17	$	0.57		$	0.45
Income (loss) from discontinued operations		(0.00	)		0.01		0.02		(0.00	)		0.01
Net income (loss)	$	(0.40	)	$	0.11	$	0.19	$	0.57		$	0.46
Diluted income (loss) per share:
Income (loss) from continuing operations	$	(0.40	)	$	0.10	$	0.17	$	0.57		$	0.44
Income (loss) from discontinued operations		(0.00	)		0.01		0.01		(0.01	)		0.01
Net income (loss)	$	(0.40	)	$	0.11	$	0.18	$	0.56		$	0.45
Weighted-average shares outstanding used in
computing income (loss) per common share:
Basic		57,636			57,693		57,770		57,771			57,717
Diluted		57,636			59,061		59,111		58,384			58,925

EX-99.2

Exhibit 99.2

WebMD Health Corp.

Supplemental Non-GAAP Financial Information of the Registrant

For the Quarters ended March 31, 2008, June 30, 2008, September 30, 2008 and December 31,
2008 and for the Year ended December 31, 2008

(in thousands)

	For the quarter ended,												For the year ended
	March 31, 2008			June 30, 2008			September 30, 2008			December 31, 2008			December 31, 2008
Revenue:
Advertising and sponsorship	$	56,482		$	62,728		$	72,438		$	85,576		$	277,224
Licensing		21,923			21,866			22,139			23,198			89,126
Print		2,245			1,410			2,220			1,317			7,192
	$	80,650		$	86,004		$	96,797		$	110,091		$	373,542
Earnings before interest, taxes, non-cash and other items (“Adjusted EBITDA”) (a)	$	16,332		$	18,392		$	25,467		$	33,909		$	94,100
Interest, taxes, non-cash and other items (b)
Interest income		3,453			2,350			2,616			2,033			10,452
Depreciation and amoritization		(6,672	)		(7,087	)		(7,056	)		(7,106	)		(27,921	)
Non-cash advertising		(1,558	)		—			(178	)		(3,361	)		(5,097	)
Non-cash stock-based compensation		(3,680	)		(3,465	)		(3,512	)		(2,657	)		(13,314	)
Impairment of auction rate securities		(27,406	)		—			—			—			(27,406	)
Restructuring		—			—			—			(2,910	)		(2,910	)
Income tax (provision) benefit		(3,432	)		(4,501	)		(7,375	)		13,097			(2,211	)
Income (loss) from continuing operations		(22,963	)		5,689			9,962			33,005			25,693
Income (loss) from discontinued operations		(372	)		663			804			(86	)		1,009
Net income (loss)	$	(23,335	)	$	6,352		$	10,766		$	32,919		$	26,702

(a)	See Annex A — Explanation of Non-GAAP Financial Measures
(b)	Reconciliation of Non-GAAP measure to net income (loss)

EX-99.3

Exhibit 99.3

Annex A to Exhibit 99.2

Explanation of Non-GAAP Financial Measures
(All dollar amounts in thousands)

     The tables in Exhibit 99.2 include both financial measures in accordance with U.S. generally accepted accounting principles, or GAAP, as well as non-GAAP financial measures. The non-GAAP financial measures represent earnings before interest, taxes, non-cash and other items (which we refer to as “Adjusted EBITDA”). Adjusted EBITDA should be viewed as supplemental to, and not as an alternative for, “income (loss) from continuing operations” or “net income (loss)” calculated in accordance with GAAP. The tables in Exhibit 99.2 include reconciliations of non-GAAP financial measures to GAAP financial measures.

     Adjusted EBITDA is used by WebMD’s management as an additional measure of WebMD’s performance for purposes of business decision-making, including developing budgets, managing expenditures, and evaluating potential acquisitions or divestitures. Period-to-period comparisons of Adjusted EBITDA help WebMD’s management identify additional trends in WebMD’s financial results that may not be shown solely by period-to-period comparisons of income (loss) from continuing operations or net income (loss). In addition, WebMD uses Adjusted EBITDA in the incentive compensation programs applicable to many of its employees in order to evaluate WebMD’s performance. WebMD management recognizes that Adjusted EBITDA has inherent limitations because of the excluded items, particularly those items that are recurring in nature. In order to compensate for those limitations, management also reviews the specific items that are excluded from Adjusted EBITDA, but included in income (loss) from continuing operations or net income (loss), as well as trends in those items. The amounts of those items are set forth, for the applicable periods, in the reconciliations of Adjusted EBITDA to income (loss) from continuing operations or to net income (loss) that accompany our press releases and disclosure documents containing non-GAAP financial measures, including the reconciliations contained in the tables included in Exhibit 99.2.

     WebMD believes that the presentation of Adjusted EBITDA is useful to investors in their analysis of WebMD’s results for reasons similar to the reasons why WebMD’s management finds it useful and because it helps facilitate investor understanding of decisions made by WebMD’s management in light of the performance metrics used in making those decisions. In addition, as more fully described below, WebMD believes that providing Adjusted EBITDA, together with a reconciliation of Adjusted EBITDA to income (loss) from continuing operations or to net income (loss), helps investors make comparisons between WebMD and other companies that may have different capital structures, different effective income tax rates and tax attributes, different capitalized asset values and/or different forms of employee compensation. However, Adjusted EBITDA is intended to provide a supplemental way of comparing WebMD with other public companies and is not intended as a substitute for comparisons based on “income (loss) from continuing operations” or “net income (loss)” calculated in accordance with GAAP. In making any comparisons to other companies, investors need to be aware that companies use different non-GAAP measures to evaluate their financial performance. Investors should pay close attention to the specific definition being used and to the reconciliation between such measures and the corresponding GAAP measures provided by each company under applicable SEC rules.

     The following is an explanation of the items excluded by WebMD from Adjusted EBITDA but included in income (loss) from continuing operations:

• Depreciation and Amortization. Depreciation and amortization expense is a non-cash expense relating to capital expenditures and intangible assets arising from acquisitions that are expensed on a straight-line basis over the estimated useful life of the related assets. WebMD excludes depreciation and amortization expense from Adjusted EBITDA because it believes (i) the amount of such expenses in any specific period may not directly correlate to the underlying performance of WebMD’s business operations and (ii) such expenses can vary significantly between periods as a result of new acquisitions and full amortization

of previously acquired tangible and intangible assets. Accordingly, WebMD believes this exclusion assists management and investors in making period-to-period comparisons of operating performance. Investors should note that use of tangible and intangible assets contributed to revenue in the periods presented and will contribute to future revenue generation and should also note that such expenses will recur in future periods.

• Stock-Based Compensation Expense. Stock-based compensation expense is a non-cash expense arising from the grant of stock-based awards to employees. WebMD believes that excluding the effect of stock-based compensation from Adjusted EBITDA assists management and investors in making period-to-period comparisons in its operating performance because it believes (i) the amount of such expenses in any specific period may not directly correlate to the underlying performance of WebMD’s business operations and (ii) such expenses can vary significantly between periods as a result of the timing of grants of new stock-based awards, including grants in connection with acquisitions. Additionally, WebMD believes that excluding stock-based compensation from Adjusted EBITDA assists management and investors in making meaningful comparisons between WebMD’s operating performance and the operating performance of other companies that may use different forms of employee compensation or different valuation methodologies for their stock-based compensation. Investors should note that stock-based compensation is a key incentive offered to employees whose efforts contributed to the operating results in the periods presented and are expected to contribute to operating results in future periods. Investors should also note that such expenses will recur in the future. Stock-based compensation expenses included in the Statement of Operations are summarized as follows:

	Quarter Ended									Year Ended
	March 31,		June 30,		September 30,		December 31,			December 31,
	2008		2008		2008		2008			2008
Non-cash stock-based compensation included in:
Cost of operations	$	1,116	$	817	$	997	$	888		$	3,818
Sales and marketing		1,126		1,261		1,215		(11	)		3,591
General and administrative		1,438		1,387		1,300		1,780			5,905

• Non-Cash Advertising Expense. This expense relates to the usage of non-cash advertising obtained from News Corporation (“Newscorp”) in exchange for equity securities issued by our parent, HLTH Corporation in 2000. The advertising is available only on various Newscorp properties, primarily its television network and cable channels, without any cash cost to WebMD. WebMD excludes this expense from Adjusted EBITDA (i) because it is a non-cash expense, (ii) because it is incremental to other non-television cash advertising expense that WebMD otherwise incurs and (iii) to assist management and investors in comparing its operating results over multiple periods. Investors should note that it is likely that WebMD derives some benefit from such advertising. Non-cash advertising expenses included in the Consolidated Statement of Operations in Sales and Marketing expense were: (a) $1,558, $178, $3,361 for the three months ended March 31, 2008, September 30, 2008 and December 31, 2008, respectively; and (b) and $5,097 for the year ended December 31, 2008.

• Interest Income. Interest income is associated with the level of marketable debt securities and other interest bearing accounts in which WebMD invests. Interest income varies over time due to varying levels of securities available for investment. Transactions that WebMD has entered into in recent periods that have impacted securities available for investment include the initial public offering of equity in WebMD and acquisitions of other companies for varying amounts of cash since our initial public offering. Additional financing transactions as well as potential acquisitions that WebMD may enter into in the future could impact the levels and timing of securities available for investment. WebMD excludes interest income from Adjusted EBITDA (i) because it is not directly attributable to the performance of WebMD’s business operations and, accordingly, its exclusion assists management and investors in making period-to-period comparisons of operating performance and (ii) to assist management and investors in making comparisons to companies with different capital structures. Investors should note that interest income will recur in future periods.

2

• Income Tax (Benefit) Provision. WebMD maintains a valuation allowance on a portion of its net operating loss carryforwards, the amount of which may change from quarter to quarter based on factors that are not directly related to WebMD’s results for the quarter. The valuation allowance is either reversed through the statement of operations or additional paid-in capital. The timing of such reversals has not been consistent and as a result, WebMD’s income tax expense can fluctuate significantly from period to period in a manner not directly related to WebMD’s operating performance. WebMD excludes the income tax (benefit) provision from Adjusted EBITDA (i) because it believes that the income tax (benefit) provision is not directly attributable to the underlying performance of WebMD’s business operations and, accordingly, its exclusion assists management and investors in making period-to-period comparisons of operating performance and (ii) to assist management and investors in making comparisons to companies with different tax attributes. Investors should note that income tax (benefit) provision will recur in future periods.

• Other Items. WebMD engages in other activities and transactions that can impact WebMD’s overall income (loss) from continuing operations. WebMD excludes these other items from Adjusted EBITDA when it believes these activities or transactions are not directly attributable to the performance of WebMD’s business operations and, accordingly, their exclusion assists management and investors in making period-to-period comparisons of operating performance. Investors should note that these other items may recur in future periods. In Exhibit 99.2, WebMD has excluded loss on the impairment of auction rate securities and a restructuring charge from Adjusted EBITDA.

3