Daniel Island-based software firm Benefitfocus expects to make $5 million less this year in profits than it originally predicted, the firm's leadership told investors in a call last week.
Instead of earning between $15 million and $20 million this year, Benefitfocus now expects to post profits in the $10 million to $20 million range before taxes, depreciation and other costs. Its sales forecast for 2019 was down by $9 million, as well, now between $292 million and $300 million.
The software company, which sells a subscription service to its benefits platform, said in its quarterly earnings report that revenue was up 13 percent compared to the same time last year. The company also reported a loss of nearly $15 million.
On the other hand, Benefitfocus added 1 million "lives" to its platform in the last quarter, which Ray August, the company's CEO, said was a record. Most of the additions come from large companies and institutions. Those customers won't actually buy a product on the Benefitfocus platform immediately, however, which is how the firm makes its money.
The company won't see revenue from those contracts until after this year, August said.
"We'll see future significant economic value on our platform," he said.
For example, Benefitfocus secured the state of Texas as a customer more than a year ago, but the company still has yet to see much in the way of profits from that relationship.
Some members of the North Carolina State Health Plan saw some of their personal information compromised in early July when Charleston-based Benefitfocus accidentally sent mail to incorrect addresses.
Only first and last names were included in the letters; no other personal data was exposed. Still, 827 members — teachers and employees of the North Carolina government — were affected by the error.
Benefitfocus, a cloud software company that makes a benefits management platform, said in a statement it "has no reason to believe that any information has been misused." The company said it could not comment further.
The letters stated that the recipient was a member of the state health plan and would soon be eligible for Medicare. Everyone whose information was inadvertently shared received a notice and correction letter.
The U.S. Department of Health and Human Services is conducting an investigation into the breach of information.
A new Harbor home
The Harbor Entrepreneur Center, one of Charleston's two tech accelerators, has found a new home after a months-long search.
The business incubator is moving into a 10,000-square-foot office just south of the medical district and Calhoun Street. Posted prices for the open workspace range from $100 per month for the right to work at communal tables to $1,500 per month for a private office.
The Harbor's lease on an office in the Pacific Box & Crate development on Upper King Street was up this month. It forfeited that space to local solar company Palmetto Clean Technology Inc., which needed more room to expand.