What changed in this filing

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Item 7. Management’s Discussion and Analysis

2023-03-14 compared with 2022-03-15 · 617 added, 456 removed, 161 unchanged (87% of the section changed)

Management’s Discussion and Analysis of Financial Condition and Results of Operations.

following discussion and analysis of our financial condition and results of operations should be read in conjunction with our consolidated

financial statements and the accompanying notes included elsewhere in this Annual Report on Form 10-K.

The discussion and analysis below

contain certain forward-looking statements about our business and operations that are subject to the risks, uncertainties, and other

factors described in the section entitled “Risk Factors,” included in Part I, Item 1A, and elsewhere in this Annual Report

on Form 10-K.

These risks, uncertainties, and other factors could cause our actual results to differ materially from those expressed

in, or implied by, the forward-looking statements.

Please read the section entitled “Cautionary Note Regarding Forward-Looking

the context requires otherwise, references to “DocGo,” “we,” “us,” “our” and “the

Company” in this section are to the business and operations of DocGo and its consolidated subsidiaries, including those periods

prior to the Business Combination.

Certain figures, such as interest rates and other percentages, included in this section have been

rounded for ease of presentation.

Percentage figures included in this section have not in all cases been calculated on the basis of such

rounded figures but on the basis of such amounts prior to rounding.

For this reason, percentage amounts in this section may vary slightly

from those obtained by performing the same calculations using the figures in DocGo’s financial statements or in the associated

Management’s Discussion and Analysis

of Financial Condition and Results of Operations.

The following discussion and analysis of our financial condition and

results of operations should be read in conjunction with our Consolidated financial statements and the accompanying notes included elsewhere

in this Annual Report on Form 10-K.

The discussion and analysis below contain certain forward-looking statements about our business and

operations that are subject to the risks, uncertainties, and other factors described in the section entitled “Risk Factors,”

included in Part I, Item 1A, and other factors included elsewhere in this Annual Report on Form 10-K.

These risks, uncertainties, and

other factors could cause our actual results to differ materially from those expressed in, or implied by, the forward-looking statements.

Please refer to the section entitled “Cautionary Note Regarding Forward-Looking Statements.”

Unless the context requires otherwise, references to “DocGo,”

“we,” “us,” “our” and “the Company” in this section are to the business and operations

of DocGo and its consolidated subsidiaries, including those periods prior to the Business Combination.

Certain figures, such as interest

rates and other percentages, included in this section have been rounded for ease of presentation.

Percentage figures included in this

section have, in some cases, been calculated on the basis of such rounded figures.

For this reason, percentage amounts in this section

may vary slightly from those obtained by performing the same calculations using the figures in DocGo’s Consolidated Financial Statements

or in the associated text.

Certain other amounts that appear in this section may similarly not sum due to rounding.

which was originally formed in 2015, is a healthcare transportation and mobile services company that uses proprietary dispatch and communication

technology to provide quality healthcare transportation and mobile services in-person medical treatment directly to patients in

the comfort of their homes, workplaces and other non-traditional locations, in major metropolitan cities in the United States

and the United Kingdom.

which was originally formed in 2015, is a healthcare transportation and mobile services company that uses proprietary dispatch and

communication technology to help provide quality healthcare transportation and mobile services in-person medical treatment

directly to patients in the comfort of their homes, workplaces and other non-traditional locations, in major metropolitan

cities in the United States and the United Kingdom.

Company derives revenue primarily from its two operating segments:

Transportation Services and Mobile Health Services.

● Transportation

The services offered by this segment encompass both emergency response and non-emergency transport

Non-emergency transport services include ambulance transports and wheelchair

Net revenue from Transportation Services is derived from the transportation of

patients based on billings to third party payors and healthcare facilities.

Health Services:

The services offered by this segment include services performed at home

and offices, COVID-19 testing, and event services which include on-site healthcare

support at sporting events and concerts.

the section of this prospectus titled “ Description of DocGo’s Business — Our Segments” and

Note 11 to the notes to the audited consolidated financial statements of Ambulnz included in the prospectus for additional information

regarding DocGo’s segments.

the years ended December 31, 2021 the Company recorded net income of $19.2 million, compared to a net loss of $14.8 million

in the year ended December 31, 2020.

January 30, 2020, the World Health Organization announced a global health emergency because of COVID-19, a new strain of coronavirus.

In March 2020, the WHO classified the COVID-19 outbreak as a pandemic, based on the rapid increase in exposure globally.

spread of COVID-19 and the related shutdowns and restrictions have had a mixed impact on our business.

In the ambulance transportation

business, which comprise predominantly non-emergency medical transport, the Company experienced a decline in transportation volumes

versus historical levels, as elective surgeries and other non-emergency surgical procedures were postponed or cancelled.

the Company experienced lost revenue associated with sporting, concerts and other events, as those events were either cancelled or have

experienced a significantly restricted number of permitted attendees In most markets, these trip volumes have recovered, and on a consolidated

basis, trip volumes in December 2021 were 27.2% above those of March 2020, when COVID-19 related restrictions were first implemented.

are two areas where the Company experienced positive business impacts from COVID-19.

In April and May 2020, the Company participated

in an emergency project with Federal Emergency Management Agency in the New York City area.

This engagement resulted in incremental

transportation revenue that partially offset some of the lost non-emergency transport revenues.

In addition, in response to the need

for widespread COVID-19 testing and available EMTs and paramedics, the Company expanded its operations to include Rapid Reliable

Testing (“RRT”), with the goal to perform COVID-19 tests at nursing homes, municipal sites, businesses, schools and other

Transportation Services:

The services offered by this segment encompass both emergency response and non-emergency transport services.

Non-emergency transport services include ambulance transports and wheelchair transports.

Net revenue from Transportation Services is derived from the transportation of patients based on billings to third party payors and healthcare facilities.

Mobile Health Services:

The services offered by this segment include a wide variety of healthcare services performed at home and offices, testing, vaccinations and event services which include on-site healthcare support at sporting events and concerts.

“Business” in this Annual Report on Form 10-K

for additional information regarding DocGo’s business.

the year ended December 31, 2022 the Company recorded net income of $30.7 million, compared to net income of $19.2 million in

the year ended December 31, 2021.

The spread of COVID-19 and the related shutdowns and restrictions had

a mixed impact on our business.

In the Transportation Services segment, which comprises primarily of non-emergency medical transport,

the Company saw a decline in volumes from historical and expected levels, as elective surgeries and other non-emergency surgical procedures

were postponed.

In addition, in the Mobile Health segment, the Company experienced lost revenue associated with sporting, concerts and

other events, as those events were cancelled or had a significantly restricted (or entirely eliminated) number of permitted attendees.

Ambulance transports and event-related revenues have both since recovered to pre-COVID levels or higher.

There are two areas where the Company experienced positive business

impacts from COVID-19.

In April and May 2020, the Company participated in an emergency project with Federal Emergency Management Agency

in the New York City area.

This engagement resulted in incremental transportation revenue that partially offset some of the lost non-emergency

transport revenues.

In addition, in response to the need for widespread COVID-19 testing and available EMTs and paramedics, the Company

expanded its operations to include Rapid Reliable Testing (“RRT”), with the goal of performing COVID-19 tests at nursing homes,

municipal sites, businesses, schools and other venues.

RRT is part of the Mobile Health business line.

Mobile Health generated approximately $234.4 million in revenue in the year

ended December 31, 2021, as compared to $30.9 million in 2020 and $1.9 million in 2019.

2020 and the early part of 2021, the Company continued to operate with several back-office employees working remotely.

the Company has not witnessed any degradation in productivity from these employees, the large majority of whom have now returned to their

respective offices, and our operations have proceeded without major interruption.

By early 2021, nearly all remote employees had returned

to work in their respective offices and other locations.

DocGo also utilized several government programs in 2020 related to the pandemic,

receiving approximately $1.0 million in payments through the Public Health and Social Services Emergency Fund authorized under the

Coronavirus Aid, Relief and Economic Security Act and related legislation as well as various state and local programs, net of amounts

that will be repaid to HHS.

DocGo also received accelerated Medicare payments of approximately $2.4 million that were required

to be repaid beginning in April 2021.

Through December 31, 2021, approximately $1.7 million of this advance had been recouped

by Medicare .

it is very difficult to accurately predict the future direction of the effects of the COVID-19 pandemic, and the related impact on

medical transportation levels, the revenue from the Transportation Services segment during 2021 exceeded that of 2020 by approximately

Since the beginning of 2021, trip volumes in most of our markets have started to return to more normal historical levels.

generated, during 2021, COVID-19 testing revenue, including its Mobile Health services segment, above the levels projected.

broader, strategic sense, the consumer focus on Mobile Health services and the formation of RRT, and its emergence as a significant contributor

to overall revenues have accelerated the diversification in the Company’s business by more rapid expansion of the Mobile Health

Company’s current business plan assumes gradual recovery of industrywide transportation volumes to historical levels, plus an increased

demand for mobile health services, a demand that was accelerated by the pandemic, but which is also being driven by longer-term secular

However, given the unpredictable, unprecedented, and fluid nature of the pandemic and its economic consequences, we are unable

to predict the duration and extent to which the pandemic and its related positive and negative impacts will affect our business, financial

condition, and results of operations in future periods.

Affecting Our Results of Operations

operating results and financial performance are influenced by a variety of factors, including, among others, obtaining operating licenses,

acquisitions, conditions in the healthcare transportation and mobile health services markets and economic conditions generally, availability

of healthcare professionals, changes in the cost of labor, and production schedules of our suppliers.

Some of the more important factors

are briefly discussed below.

Future revenue growth and improvement in operating results will be largely contingent on DocGo’s ability

to penetrate new markets and further penetrate existing markets, which is subject to a number of uncertainties, many of which are beyond

DocGo’s control.

The COVID-19 pandemic has also significantly impacted DocGo’s business, as discussed above.

Mobile Health generated approximately

$325.9 million in revenue in the year ended December 31, 2022, as compared to $234.4 million in 2021 and $30.9 million in 2020.

COVID-19 testing has become a minor part of this segment’s business, as of the second half of 2022, the Mobile Health segment has

continued to grow.

We have expanded our service offerings in this segment to offer a wider range of testing, vaccination and other services

to a broader customer group.

During 2020 and the early part of 2021, the Company continued to operate

with several back-office employees working remotely.

During that time, the Company did not witness any significant reduction in productivity

from these employees, nearly all of whom returned to their respective offices and other locations by early 2021 and our operations have

proceeded without major interruption.

DocGo also utilized several government programs in 2020 related to the pandemic, receiving approximately

$1.0 million in payments through the Public Health and Social Services Emergency Fund authorized under the Coronavirus Aid, Relief and

Economic Security Act and related legislation as well as various state and local programs.

DocGo also received accelerated Medicare payments

of approximately $2.4 million that were repaid in 2022.

As the COVID-19 pandemic reaches endemic stages, the future impacts

of it or other pandemics on DocGo remain highly uncertain and subject to numerous factors, including the severity of any new outbreaks,

resurgences and variants, actions taken to contain resurgences or variants or to address their impact, and other effects, and its related

impact on medical transportation levels remain uncertain.

However, trip volumes in most of our markets returned to more normal historical

levels in 2021, and this trend continued throughout 2022.

The Company generated, during 2021, COVID-19 testing revenue, included in its

Mobile Health services segment, above the levels projected, and this persisted through the second quarter of 2022.

However, as expected,

COVID-19 testing revenues declined in the third quarter of 2022 and declined further in the fourth quarter, to the point where, as of

the date of the filing of this Annual Report on Form 10-K, they account for an insignificant proportion of total revenues.

Given the nature

of the Company’s contracts with most of its customers, which include multiple procedures for which the Company is paid per hours

worked, per vehicles and related equipment utilized and on a per-procedure basis (such procedures including both testing and several other

procedures), it is difficult to determine the revenues that are directly attributable to COVID-19 testing.

However, the Company estimates

that COVID-19 testing revenue will continue to account for an insignificant proportion of Mobile Health segment and overall consolidated

revenues in 2023 and beyond, as COVID-19 enters the endemic phase.

In a broader, strategic sense, the consumer focus on Mobile Health

services and the formation of RRT, and its emergence as a significant contributor to overall revenues, have accelerated the diversification

in the Company’s business by more rapid expansion of the Mobile Health segment, which has now become our larger operating segment,

both in terms of revenues and personnel.

The Company’s current business plan assumes an increased demand

for Mobile Health services, a demand that was accelerated by the pandemic, but which we believe is also being driven by longer-term secular

factors, such as the increasing desire on the part of patients to receive treatments outside of traditional settings, such as doctor’s

offices and hospitals.

In the Transportation segment, volumes are expected to continue to rise, reflecting an aging population in the

and U.K., which tends to drive demand for the non-emergent medical transportation services provided by the Company.

Factors Affecting

Our Results of Operations

Our operating results and financial performance are influenced by a

variety of factors, including, among others, our ability to obtain or maintain operating licenses;

the success of our acquisition strategy;

conditions in the healthcare transportation and mobile health services markets;

our competitive environment;

overall macroeconomic and

geopolitical conditions, including rising interest rates, the inflationary environment, the potential recessionary environment, regional

conflict and tensions;

availability of healthcare professionals;

changes in the cost of labor;

and production schedules of our suppliers.

Some of these important factors are briefly discussed below.

Future revenue growth and improvement in operating results will be largely

contingent on DocGo’s ability to penetrate new markets and further penetrate existing markets, which is subject to a number of uncertainties,

many of which are beyond DocGo’s control.

The COVID-19 pandemic also significantly impacted DocGo’s business, as discussed

While the direct impact of the pandemic itself has waned, other impacts, such as supply chain disruptions and the cost and availability

of labor are expected to persist.

Operating Licenses

has historically pursued a strategy to apply for ambulance operating licenses in the states, counties and cities, identified for future

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DocGo pursued an acquisition strategy to obtain ambulance operating licenses from small operators.

Future acquisitions may also include

larger companies that may help drive revenue, profitability, cash flow and stockholder value During the 12 months ended December 31,

2021, DocGo completed one acquisition, for a purchase price of $2.3 million, which contributed approximately $0.3 million to

2021 revenues.

During the 12 months ended December 31, 2020, DocGo completed one acquisition, for a purchase price of $0.8 million, which

contributed approximately $0.1m to 2020 revenues.

During the 12 months ended December 31, 2019, DocGo completed four acquisitions,

for an aggregate purchase price of approximately $1.1 million.

These acquisitions contributed a combined total of approximately

$0.4 million to 2019 revenues.

services market

transportation services market is highly dependent on patients requiring transportation after surgeries and other medical procedures

and treatments.

During the pandemic, DocGo experienced a decrease in transportation volumes as a result of fewer elective surgeries.

However, the Company was able to reallocate assets to locations where demand increased as a result of the pandemic.

economic conditions in the markets we operate

Future acquisitions may also

include larger companies that may help drive revenue, profitability, cash flow and stockholder value, in both the Mobile Health and

the Transportation segments.

During the twelve months ended December 31, 2022, DocGo completed five acquisitions, for a

purchase price of $69.1 million.

On July 6, 2022, the Company acquired Government Medical Services,

LLC (“GMS”) in exchange for $20.3 million in cash and up to a total of $3.0 million in future contingent consideration upon

GMS meeting certain performance conditions .

GMS is in the business of providing licensed healthcare clinicians.

We believe this

acquisition will allow us to increase our presence in that market, while giving us improved access to municipal contracts.

On July 13, 2022, the Company acquired Exceptional Medical Transportation,

LLC (“Exceptional”) in exchange for $7.7 million in cash (and a total of $6.0 million deferred consideration).

Company also agreed to pay an estimated $1.1 million contingent consideration upon Exceptional meeting certain performance conditions.

Exceptional is in the business of providing medical transportation services in New Jersey.

We believe this acquisition will allow us to

increase our presence in that market.

On August 9, 2022, the Company acquired Ryan Brothers Ambulance Inc.

(“RB”), in exchange for $7.4 million of cash (and a total of $4 million in future contingent consideration).

Ryan Brothers

is in the business of providing medical transportation services in Wisconsin.

We believe this acquisition will allow us to increase our

presence in that market.

October 12, 2022, the Company acquired Community Ambulance Services LTD (“CAS”) in exchange for approximately $5.5

million in cash.

CAS is located in the U.K.

and is engaged in providing emergency and non-emergency transport

services, including high dependency, urgent care, mental health and blue light transport services and diagnostics testing.

that this acquisition will help allow us to continue to grow our presence in the U.K.

On December 9, 2022, Ambulnz

Ltd., a wholly owned subsidiary of the Company acquired Location Medical Services, LLC (“LMS”) for a total of $11.6 million

in cash (of which $11.3 million is deferred consideration) and $2.5 million in future contingent consideration.

LMS, based in Shepperton,

U.K., provides professional medical support services, including staff and equipment, for events (festivals, equestrian, cycling, etc.),

as well as for the film and television production industry.

LMS has a staff of over 250 medical professionals.

We believe that this acquisition

will allow us to increase our share of the events business in the U.K.

During the twelve months ended December 31, 2021, DocGo completed

one acquisition, for a purchase price of $2.3 million.

Healthcare Services Market

The transportation services market is highly dependent on patients

requiring transportation after surgeries and other medical procedures and treatments.

During the pandemic, DocGo experienced a decrease

in transportation volumes as a result of fewer elective surgeries.

However, since 2021, the Company has seen increased demand and trip

volumes in nearly all of its Transportation services markets, as elective surgeries resumed and as the Company expanded its customer base.

Overall Economic Conditions in the Markets in which we Operate

changes both nationally and locally in our markets impact our financial performance.

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of any regional or local economy in which we operate and other factors beyond our control could adversely affect our business.

Volumes and Average Trip Price

Trip Volumes and Average

“trip” is defined as an instance where the Company completes the transport of a patient to a specific destination, for which

we are able to charge a fee.

This metric does not include instances where a trip is ordered and subsequently either canceled (by the

customer) or declined (by the Company).

As trip volume represents the most basic unit of transportation service provided by the Company,

it is the best measure of the level of demand for the Company’s Transportation Services, and is used by management to monitor and

manage the scale of the business.

This metric does not include instances where a trip is ordered and subsequently either canceled (by the customer)

or declined (by the Company).

As trip volume represents the most basic unit of transportation service provided by the Company, it is the

best measure of the level of demand for the Company’s Transportation services, and is used by management to monitor and manage the

scale of the business.

average trip price is calculated by dividing the aggregate revenue from completed transports (“trips”) by the total number

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the trip counts or average trip prices mentioned above.

ability to control expenses

pay close attention to managing our working capital and operating expenses.

Some of our most significant operating expenses are labor

costs, medical supplies and vehicle-related costs, such as fuel, maintenance, repair and insurance.

Insurance costs include premiums

paid for coverage as well as reserves for estimated losses within the Company’s insurance policy deductibles.

We employ our proprietary

technology to drive improvements in productivity per transport.

We regularly analyze our workforce productivity to achieve the optimum,

cost-efficient labor mix for our locations.

in April 2021, the inflation rate in the US, as measured by the Consumer Price Index (CPI) has been steadily increasing.

inflation rate was approximately 1.8%, while it dropped to approximately 1.2% in 2020.

These data are reported monthly, showing year-over-year

changes in prices across a basket of goods and services.

For 2021, inflation increased from the 1.4%-2.6% range in the first quarter,

to 4.2% in April, and was in the 5.0% area through the end of the third quarter of 2021.

The inflation rate continued to increase throughout

the fourth quarter, measuring approximately 7.5% in December 2021.

The increased inflation rate has had an impact on the Company’s

expenses in several areas, including wages, fuel and medical and other supplies.

This has had the impact of compressing gross profit

margins, as the Company is generally unable to pass these higher costs on to its customers, particularly in the short term.

2022, we anticipate a moderation of the inflation rate when compared to 2021, when the annual inflation rate was 4.7%, but expect that

inflation will remain above the levels seen in the previous 10 years, when the annual inflation rate ranged from 0.1% to 2.4%.

is above the levels that the Company anticipates in 2022, gross margins could be below plan.

in R&D and enhancing our customer experience

We anticipate that these fixed rate, “leased hour” programs will account

for an increasing proportion of the Transportation segment’s revenues in the future.

Our Ability to Control Expenses

We pay close attention to managing our working capital and operating

Some of our most significant operating expenses are labor costs, medical supplies and vehicle-related costs, such as fuel,

maintenance, repair and insurance.

Insurance costs include premiums paid for coverage as well as reserves for estimated losses within

the Company’s insurance policy deductibles.

We aim to employ our proprietary technology to drive improvements in productivity per

We regularly analyze our workforce productivity with a goal of balancing the optimum, cost-efficient labor mix for our

Beginning in March 2021, the inflation rate in the US, as measured

by the Consumer Price Index (CPI) has generally trended higher.

This data is reported monthly, showing year-over-year changes in prices

across a basket of goods and services.

The monthly 12-month inflation rate was 2.6% in March 2021, and increased steadily over the rest

of 2021 and into 2022, with the inflation rate hitting 9.1% in June 2022.

The inflation rate has seemingly moderated since that point,

declining to 6.4% in January 2023, but remains well above historical averages.

On an annual basis, in 2019, the inflation rate was approximately

1.8%, while it dropped to approximately 1.2% in 2020, rising to 4.7% in 2021 and 8.0% in 2022.

The increased inflation rate has had an

impact on the Company’s expenses in several areas, including wages, fuel and medical and other supplies.

This has had the impact

of compressing gross profit margins, as the Company is generally unable to pass these higher costs on to its customers, particularly in

the short term.

In an attempt to dampen inflation, the U.S.

Federal Reserve implemented seven interest rate hikes in 2022, and another

hike to date in 2023, raising its benchmark rate (the “federal funds rate”) from near 0.00%% at the beginning of 2022 to the

current level of 4.50%-4.75% as of the date of the filing of this Annual Report on Form 10-K.

The federal funds rate was raised in March,

May, June, July, September, November and December of 2022 and in February of 2023.

The rate of the increase in the federal funds rate

has declined, however, with the December 2022 increase coming in at 0.50% and the February 2023 rate increase of 0.25%, compared with

rate hikes at 0.75% each in June, July, September and November of 2022.

Looking to 2023, we anticipate a continued moderation of the inflation

rate when compared to the levels seen in 2022, as a result of these recent rate hikes, but expect that inflation will remain well above

the levels seen in the previous 10 years, when the annual inflation rate ranged from 0.1% to 2.4%.

If inflation is above the levels that

the Company anticipates, gross margins could be below plan and our business, operating results and cash flows may be adversely affected.

Investing in R&D and Enhancing our Customer Experience

performance is dependent on the investments we make in research and development, including our ability to attract and retain highly skilled

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and services, mobile applications and other new offerings.

If we fail to innovate and enhance our brand and our products, our market

position and revenue will likely be adversely affected.

If we fail to innovate and enhance our brand and our products, our market position

and revenue will likely be adversely affected.

Regulatory Environment

is subject to federal, state and local regulations including healthcare and emergency medical services laws and regulations and tax laws

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such change occurs, compliance with new laws and regulations might significantly affect its operations and cost of doing business.

of Results of Operations

Components of Results

of Operations

business consists of two reportable segments — Transportation services and Mobile Health services.

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results from operations are only included in the discussion of consolidated results of operations.

Company’s revenue consists of services provided by its ambulance Transportation segment and its Mobile Health segment.

Company’s revenue consists of services provided by its Transportation segment and its Mobile Health segment.

Cost of Revenues

of revenues consists primarily of revenue generating wages paid to employees, vehicle insurance costs (including insurance premiums and

costs incurred under the insurance deductibles), maintenance, and fuel related to Transportation Services, and laboratory fees, facility

rent, medical supplies and subcontractors.

costs incurred under the insurance deductibles), maintenance, fuel, laboratory fees, facility rent, medical supplies and subcontractors.

We expect cost of revenue to continue to rise in proportion to the expected increase in revenue.

and administrative expenses

and administrative expense consists primarily of salaries, bad debt expense, insurance expense, consultant fees, and professional fees

Operating expenses

General and Administrative Expenses

and administrative expenses consist primarily of salaries, bad debt expense, insurance expense, consultant fees, and professional fees

for accounting services.

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expenses, investor relations activities, and other administrative and professional services.

and Amortization

Depreciation and Amortization

depreciates its assets using the straight-line method over the estimated useful lives of the respective assets.

Amortization of

intangibles consists of amortization of definite-lived intangible assets over their respective useful lives.

and Regulatory

Amortization of intangibles

consists of amortization of definite-lived intangible assets over their respective useful lives.

Regulatory Expenses

and regulatory expenses include legal fees, consulting fees related to healthcare compliance, claims processing fees and legal settlements.

and development

and development expense, net of capitalization, consists primarily of cost incurred in the design and development of DocGo’s proprietary

technology, third-party software and technologies.

We expect technology and development expense to increase in future periods to

support our growth, including continuing to invest in the optimization, accuracy and reliability of our platform and drive efficiency

in our operations.

These expenses may vary from period to period as a percentage of revenue, depending primarily upon when we choose

to make more significant investments.

advertising and marketing

Technology and

development Expenses

Technology and development expense, net of capitalization, consists

primarily of costs incurred in the design and development of DocGo’s proprietary technology, third-party software and technologies.

We expect technology and development expense to increase in future periods to support our growth, including as we invest in the optimization,

accuracy and reliability of our platform to help drive efficiency in our operations.

These expenses may vary from period to period as

a percentage of revenue, depending primarily upon when we choose to make more significant investments, which is in turn, dependent on

numerous factors, including when we plan to enter into new business lines or customer sales channels.

Sales, Advertising and Marketing

sales and marketing expenses consist of costs directly associated with our sales and marketing activities, which primarily include sales

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We expect that our sales and marketing expenses will continue

to increase over time as we increase our marketing activities, grow our domestic and international operations, and continue to build

brand awareness.

expense consists primarily of interest on our outstanding borrowings under our outstanding notes payable and financing obligations.

of Operations

of Fiscal 2021 with Fiscal 2020

For the Years Ended

to increase over time as we increase our marketing activities, grow our domestic and international operations, and continue to build brand

As the Company expands its sales efforts to include the direct-to-consumer channel, marketing expenses are likely to increase

as a percentage of revenues, given the marketing-intensive nature of that sales channel.

Interest Expense

expense consists primarily of interest on our outstanding borrowings under our outstanding notes payable, credit line and financing obligations.

Results of Operations

Comparison of Fiscal

2022 with Fiscal 2021

Years Ended December 31,

$ in Millions

Revenues, net

Cost of revenue

Cost of revenues

Operating expenses:

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Interest income (expense), net

Gain (loss) from PPP loan forgiveness

Gain (loss) on disposal of fixed assets

Gain (loss) on remeasurement of warrant liabilities

Gain (loss) on initial equity method investment

Total other expense

Net income/(loss) before income tax

Income tax (expense) benefit

Gain (loss) from Payroll Protection Program (“PPP”) loan forgiveness

Gain on remeasurement of warrant liabilities

Gain (loss) on equity method investment

Gain on remeasurement of finance leases

Loss on disposal of fixed assets

Gain on bargain purchase

Other income (loss)

Total other income (expense)

Net income (loss) before income tax benefit (expense)

Benefit (provision) for income tax

Net income (loss)

Net income (loss) attributable to Non-controlling interests

Net income (loss) attributable to the shareholders of DocGo Inc and Subsidiaries

Net loss attributable to noncontrolling interests

and Subsidiaries

For the year ended December

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December 31, 2021.

Transportation

the year ended December 31, 2021, Transportation Services revenue totaled $84.3 million and increased by $21.1 million, or 33%, as compared

with the year ended December 31, 2020.

This increase was due to a 12% increase in transportation trip volumes, from 159,908 trips for

the year ended December 31, 2020 to 179,063 trips for the year ended December 31, 2021.

The increase in trip volumes is due to a combination

of growth in markets originally entered in 2019 and 2020, expansion of existing markets and entry into new markets in 2021.

trip price increased from $324 in the year ended December 31, 2020, to $342 in the year ended December 31, 2021.

The increase in the

average trip price in the 2021 period reflects a shift in mix toward higher-priced transports.

We anticipate that average trip price

could increase further in 2022, due to a 5.1% increase in the Medicare reimbursement rate for ambulance transports.

Mobile Health

For the year ended December 31, 2022, Mobile Health revenue was $325.9

million, an increase of $91.4 million, or 39%, as compared with the year ended December 31, 2021.

This increase was primarily due to the

expansion of the services offered by this segment, particularly with respect to testing, vaccination and other healthcare services revenues.

This expansion accelerated through 2021 and into 2022 as the Company increased its customer base, primarily in the municipal customer

segment, and its geographic reach, while extending the terms of and/or expanding the scope of several large customer contracts and introducing

a broader range of services.

Compared to the prior year, 2022 featured significantly lower COVID-19 testing revenue, which was outweighed

by the substantial increase in other Mobile Health services, as the Mobile Health segment transitioned away from its dependence on COVID-19

related revenue.

COVID-19 testing continued to be a significant driver of Mobile Health revenues in the first half of 2022, but dropped

sharply in the third quarter of the year, and represented an insignificant proportion of total revenues in the fourth quarter.

Transportation Services

revenues were also driven higher in 2021 by an 135% increase in revenues generated from programs under which DocGo is paid a fixed rate

for the use of a fully staffed and equipped ambulance, driven by new customer acquisition.

These services do not factor in the trip counts

or average trip prices mentioned above.

This was partially offset by the absence of FEMA transport revenues in the current year period.

FEMA revenues amounted to approximately $4.5 million in the second quarter and full year of 2020.

For the year ended December

31, 2021, Mobile Health revenue totaled $234.4 million, an increase of $203.5 million, or 659%, as compared with the year ended December

This significant increase was mainly due to the expansion of the services offered by this segment in 2021, particularly with

respect to COVID-19 related testing (which began in May 2020) and vaccination and other healthcare services revenues included in the Mobile

Health segment.

This expansion accelerated throughout 2021 as the Company increased its customer base and geographic reach, while extending

several large customer contracts and began providing a broader range of services.

For the year ended December

31, 2021, total cost of revenue (exclusive of depreciation and amortization) increased by 233%, as compared to the year ended December

31, 2020, while revenue increased by approximately 239%.

Cost of revenue as a percentage of revenue decreased to 65.6% in 2021 from 66.6%

absolute dollar terms, cost of revenue in the year ended December 31, 2021 increased by $146.3 million from the levels of the year ended

For the year ended December 31, 2022, Transportation Services revenue

was $114.6 million an increase of $30.3 million, or 36%, as compared with the year ended December 31, 2021.

This increase was due to a

20% increase in transportation trip volumes, from 180,753 trips for the year ended December 31, 2021 to 216,009 trips for the year ended

December 31, 2022.

This was primarily attributable to a $40.9 million increase in total compensation, reflecting higher headcount for

both the Transportation Services and Mobile Health segments;

a $65.5 million increase in subcontracted labor, driven mostly by the Mobile

Health segment, where revenue increases outpaced the Company’s ability to service such revenue solely with internal resources,

temporarily causing the Company to rely increasingly on subcontracted labor;

a $12.7 million increase in lab fees related to COVID-19

testing activity, which was launched toward the middle of the prior-year period and continued to increase in volume throughout the year,

particularly in the fourth quarter of 2021;

a $20.8 million increase in medical supplies, due to the purchase of COVID-19 test kits and

the need for increased personal protective equipment (PPE) and related supplies, particularly in the fourth quarter of 2021, and the

increased cost thereof as a result of increased demand during the pandemic;

and a $4.6 million increase in vehicle costs, driven by a

continued increase in the Company’s vehicle fleet and higher fuel costs;

and $1.6 increase in facilities and other costs of sales,

relating to the Company’s increased scale and geographic presence.

the Transportation Services segment, cost of revenues (exclusive of depreciation and amortization) in the year ended December 31, 2021

amounted to $63.4 million, up $19.6 million, or 45%, from the year ended December 31, 2021.

Cost of revenues as a percentage of revenues

increased to 75.3% from 69.3%, reflecting higher hourly wages in certain markets and increased overtime for field employees, and increased

fuel costs, as described above.

the Mobile Health segment, cost of revenues (exclusive of depreciation and amortization) in the year ended December 31, 2021 amounted

to $145.6 million, compared to $18.9 million in the year ended December 31, 2020.

Cost of revenues as a percentage of revenues increased

to 62.3% from 61.2%, despite lower average per-test lab fees and the inclusion of higher-margin, hourly-based programs in the 2021 period,

reflecting the increased use of higher cost subcontracted labor and significant increases in medical supply costs, as described above.

For the year ended December

31, 2021, the Company recorded $94.4 million of operating expenses compared to $46.1 million for the year ended December 31, 2020, an

increase of 105%.

As a percentage of revenue, operating expenses declined from 49.0% in 2020 to 29.6% in 2021, due primarily to the significant

increase in overall revenues described above, coupled with the semi-fixed nature cost of the corporate infrastructure.

The increase of

$48.3 million related primarily to a $25.8 million increase in payroll due to investments in and expansion of corporate infrastructure

to support the revenue growth;

a $0.9 million increase in subcontracted labor costs, due to the growth of the Mobile Health segment, which

outpaced the Company’s ability to hire enough internal personnel to service these revenues;

a $3.7 million increase in sales and

marketing cost, driven by higher sales commissions and increased marketing activity arising from the expansion of the Mobile Health segment;

a $1.0 million increase in liability insurance expense, reflecting a reserve for estimated losses under the Company’s insurance

policy deductibles;

a $4.5 million increase in travel and entertainment expenses, reflecting both the growth of the overall employee base,

as well as increased business development related activities for both the Transportation Services and Mobile Health segments;

a $3.4 million

increase in depreciation and amortization due to an increase in assets to support revenue growth and capitalized software amortization;

a $1.9 million increase in legal, accounting and other professional fees related to increased revenue and related contract generation

and financing and capital-raising activities;

a $1.8 million increase in office-related expenses, owing to the Company’s ongoing

geographic expansion;

a $0.8 million increase in licenses and taxes, due primarily to the geographic expansion of the Mobile Health segment;

a $1.9 million increase in computer IT infrastructure, driven by the Company’s business and headcount expansion;

The increase in trip volumes was due to a combination of growth in the customer base in certain core markets, entry

into new markets in 2021 and early 2022 and acquisitions made during the second half of 2022.

Our average trip price increased from $301

in the year ended December 31, 2021, to $380 in the year ended December 31, 2022.

The increase in the average trip price in 2022 reflected

a shift in mix toward higher-priced transports with existing customers, as well as the acquisition of licenses to provide higher acuity

transports resulting in higher prices per trip.

The average trip price also benefited from a 5.1% increase in the average Medicare reimbursement

rate for ambulance transports.

In October 2022, the Centers for Medicare and Medicaid Services (CMS) announced that the Medicare ambulance

fee schedule would be increasing by a further 8.7%, effective January 1, 2023.

Cost of Revenue

For the year ended December 31, 2022, total cost of revenue (exclusive

of depreciation and amortization) increased by 37%, as compared to the year ended December 31, 2021, while revenue increased by approximately

Cost of revenue as a percentage of revenue decreased to 64.9% in 2022 from 65.5% in 2021.

In absolute dollar terms,

cost of revenue in the year ended December 31, 2022 increased by $76.8 million from the levels of the year ended December 31, 2021.

was primarily attributable to a $64.9 million increase in total compensation, due to higher headcount for both the Transportation Services

and Mobile Health segments;

a $16.0 million increase in subcontracted labor, driven mostly by the Mobile Health segment, where the Company

did not have sufficient personnel to staff the initial phases of large new projects;

$13.6 million increase in vehicle costs, driven by

a continued increase in the Company’s vehicle fleet and higher fuel and maintenance costs, as well as costs incurred to rent vehicles

to provide Mobile Health services;

a $2.1 million increase in travel costs, due to field personnel and other clinicians who traveled out

of their home regions to provide Mobile Health services;

a $0.4 million increase in facilities and related costs;

and approximately $2.6

million in increases across a variety of other cost of revenue categories relating to the Company’s increased scale and geographic

These items were partially offset by a $21.1 million decrease in lab fees related to COVID-19 testing activity, reflecting sharply

lower COVID-19 testing activity in the second half of 2022, lower per-test lab fees and a shift toward rapid tests;

and a $1.8 million

increase in bad debt expense, in line with the increase in overall revenues during the period.

the Transportation Services segment, operating expenses in the year ended December 31, 2021 were $47.2 million, up $8.5 million, or 22%,

from the year ended December 31, 2020.

Operating expenses as a percentage of revenues declined to 56.1% from 61.2% in the prior year

period, reflecting the increase in Transportation Services revenues, compared to the semi-fixed cost nature of the corporate infrastructure.

The increased operating expenses, in dollar terms, in the year ended December 31, 2021 primarily reflected higher costs for payroll,

travel and entertainment, professional fees and depreciation, as described above.

decline in medical supplies, reflecting a decline in COVID-19 testing activity and improved sourcing of various supplies.

For the Mobile Health segment,

operating expenses in the year ended December 31, 2021 were $47.2 million, compared to operating expenses of $7.5 million in the year

cost of revenues (exclusive of depreciation and amortization) in the year ended December 31, 2022 amounted to $199.2 million, compared

to $145.2 million in the year ended December 31, 2021.

Cost of revenues as a percentage of revenues decreased slightly to 61.1% from 61.9%,

due to the increase in revenues and the continued shift away from higher-cost subcontracted labor toward Company personnel during 2022,

which was partially offset by higher compensation costs associated with some of the Company’s newer projects.

For the Transportation services

segment, cost of revenues (exclusive of depreciation and amortization) in the year ended December 31, 2022 was $86.5 million, an increase

of $23.1 million, or 36%, from the year ended December 31, 2021.

Cost of revenues as a percentage of revenues were essentially unchanged,

at 75.5% in 2022 compared to 75.3% in 2021.

Increased volumes and higher average trip prices, as described above, combined with lower

average hourly wages, as recent market wage pressures began to subside, and as the Company more effectively managed its staff to reduce

overtime hours for field employees, to offset the effects of increased fuel costs.

Fuel prices moderated somewhat during the third quarter

and in the fourth quarters of 2022, but the full-year average fuel price for 2022 was approximately 29% above the full-year average for

We anticipate that fuel prices will remain at elevated levels for 2023, but we expect that the full-year average for 2023 will be

lower than it was in 2022.

Operating expenses

For the year ended December 31, 2022, operating expenses were $132.9

million compared to $94.4 million for the year ended December 31, 2021, an increase of 41%.

As a percentage of revenue, operating expenses

increased slightly, from 29.6% in 2021 to 30.2% in 2022, despite the significant increase in overall revenues described above, as the

Company continued to add to its management infrastructure and incurred a full year’s worth of expenses relating to its status as

a public company.

The increase of $38.3 million related primarily to a $20.1 million increase in total compensation, which includes salaries,

benefits, bonuses and commissions for both direct and subcontracted labor, reflecting higher headcount driven by the Company’s overall

growth and expansion;

a $7.1 million increase in legal, accounting and other professional fees related to increased revenue and related

contract generation and SEC filing-related costs;

a $2.8 million increase in insurance costs reflecting the growth and expansion of the

Company, as well as the addition of directors and officers (D&O) insurance in 2022;

a $3.2 million increase in depreciation and amortization

charges due to an increase in assets to support revenue growth and capitalized software amortization, including from recently acquired

a $2.3 million increase in rent utility expenses, due to the Company’s ongoing growth and geographic expansion;

million increase in IT infrastructure, driven by the Company’s business and headcount expansion;

and a $0.6 million increase in

marketing expenses, driven in part by expenditures made to develop and expand the Company’s direct-to-consumer (DTC) and other Mobile

Health programs.

These items were partially offset by a $0.7 million decline witnessed across several operating expense categories, such

as travel, commissions and general office expenses.

The Company anticipates that operating expenses will continue to increase along with

the Company’s revenue growth and remain in the range of 25%-30% of revenue in the coming quarters.

For the Mobile Health segment,

operating expenses in the year ended December 31, 2022 were $58.0 million, up 25% from operating expenses of $46.3 million in the year

ended December 31, 2021.

Operating expenses as a percentage of revenues decreased to 20.1% from 24.2% in 2020, despite significant expenditures

made in the expansion of services and geographic areas of operation, as well as the buildout of the Mobile Health management infrastructure

throughout 2021, due to the faster rate of increase in Mobile Health revenues.

The increased operating expenses, in dollar terms, in 2021

were primarily driven by higher costs for payroll, subcontracted labor costs, travel and entertainment, marketing and computer IT infrastructure,

and facilities costs, as described above.

income (expense, net)

the year ended December 31, 2021, the Company recorded $0.8 million of net interest expense compared to $0.2 million of interest expense

in the year ended December 31, 2020.

The increase in net interest expense in the current period reflects an increase in payments made

for leased vehicles, as the Company’s fleet expanded.

the year ended December 31, 2021, the Company recorded a $0.1 million gain from the forgiveness of a PPP loan made to one of the Company’s

subsidiaries.

No gain or loss was recorded in relation to the disposition of any loan in the prior year period.

on remeasurement of warrant liabilities

the year ended December 31, 2021, the Company recorded a $5.2 million gain from the remeasurement of warrant liabilities, The warrants

are marked-to-market in each reporting period, and this gain reflects the decline in DCGO’s stock price relative to the beginning

Operating expenses as a percentage of revenues decreased to 17.8% from 19.8% in 2021, due to the increase in

Mobile Health revenues, which outweighed the effect of the significant expenditures that were made in 2022 in the expansion of services

and geographic areas of operation, as well as the continued buildout of the Mobile Health management infrastructure and the costs of developing

the Company’s “on-demand” direct-to-consumer offering.

For the Transportation services

segment, operating expenses in the year ended December 31, 2022 were $74.0 million, up $26.6 million, or 56%, from the year ended December

Operating expenses as a percentage of revenues increased to 64.6% from 56.3% in the prior year period, despite the increase

in revenues, primarily due to increases in the Company’s corporate overhead expenditures, as described above, as these expenses

were allocated to the Transportation segment for purposes of segment reporting.

Operating expenses for the Transportation segment were

also driven higher by the inclusion of the acquisitions the Company made in the second half of 2022.

Interest Income (Expense), Net

For the year ended December

31, 2022, the Company recorded $0.8 million of net interest income compared to $0.8 million of interest expense in the year ended December

This was due to a significantly higher amount of interest earned during 2022, resulting from an increase in the Company’s

cash balances in income-bearing accounts, coupled with higher rates of interest earned on balances in these accounts, which reflected

significantly higher market interest rates.

Gain/(loss) on Remeasurement of Warrant Liabilities

During the year ended December

31, 2022, the Company recorded a net gain of approximately $1.1 million from the remeasurement of warrant liabilities.

The warrants are

marked-to-market in each reporting period, and this gain reflected the decrease in DocGo’s stock price relative to the beginning

of the period.

No gain or loss was recorded in relation to the remeasurement of warrant liabilities in 2020.

tax (expense)/benefit

During the year ended December 31, 2021, the Company recorded a net gain of $5.2 million on the remeasurement of warrant

On August 15, 2022, the Company announced the redemption of all of its outstanding warrants under the Warrant Agreement,

dated as of October 14, 2020, by and between Motion and Continental Stock Transfer & Trust Company, as warrant agent, on the redemption

date of September 16, 2022 (the “Redemption Date”).

Warrants surrendered for exercise on a cashless basis resulted in the

issuance of 1,406,371 shares.

A total of 68,514 warrants were not surrendered on the Redemption Date and were redeemed for $0.10 per warrant.

Gain/(Loss) on Equity Method Investment

During the year ended December

31, 2021, the Company recorded income tax expense of $0.6 million, compared to an income tax expense of $0.2 million in the year ended

31, 2022, the Company recorded a gain on equity method investment of $8,919, representing its share of the losses incurred by an entity

in which the Company has a minority interest, which is accounted for under the equity method.

This investment was made in the fourth quarter

of 2021, during which period a loss of $66,818 was recorded in relation to this equity method investment.

Gain on Bargain Purchase

During the year ended December

31, 2022, the Company recorded a gain on bargain purchase of approximately $1.6 million in relation to an acquisition made during the

fourth quarter of the year, wherein the tangible net asset value of the acquired entity exceeded the purchase price.

No such gain or loss

was recorded during the same period in 2021.

Gain/(Loss) from Remeasurement of Finance Leases

During the year ended December

31, 2022, the Company recorded a gain from remeasurement of finance leases of approximately $1.4 million, resulting from a change in estimated

remaining liabilities under the terms of its leases.

No such gain or loss was recorded in the same period in 2021.

Gain from PPP Loan Forgiveness

In 2021, the Company recorded

a $0.1 million gain due to the forgiveness of a loan that one of its subsidiaries had obtained via the government’s Paycheck Protection

Program (PPP) in 2020.

No gain from loan forgiveness was recorded during the year ended December 31, 2022.

Income Tax Benefit (Expense)

During the year ended December

31, 2022, the Company recorded an income tax benefit of $7.9 million compared to an income tax expense of $0.6 million in the year ended

December 31, 2021.

The increase in income tax expense resulted from the higher level of pretax income as well as state income taxes in

jurisdictions the Company entered during the past year.

Noncontrolling

the year ended December 31, 2021, the Company had a net loss attributable to noncontrolling interest of approximately $4.6 million, compared

to a net loss attributable to noncontrolling interest of $0.4 million for the year ended December 31, 2020.

The increased loss reflects

ongoing investments made into new markets that were entered into during 2020 and 2021.

and Capital Resources

inception, DocGo completed three equity financing transactions as its principal source of liquidity, with minimal debt incurred.

the Company utilized equity raised to finance operations during its development phase, investments in assets, ambulance operating licenses

and funding accounts receivable.

The Company has also funded these activities through operating cashflows.

In November 2021, upon the

completion of the merger between Motion Acquisition Corp.

and Ambulnz, Inc., the Company received proceeds of approximately $158.1 million,

net of transaction expenses.

Despite the fact that the Company generated positive net income in the year ended December 31, 2021, operating

cash flows are not always sufficient to meet immediate obligations arising from current operations.

For example, as the business has

grown, the Company’s expenditures for human capital and supplies has expanded accordingly, and the timing of the payments for payroll

and to associated vendors, compared to the timing of receipts of cash from customers frequently results in the requirement for using

existing cash balances to fund these working capital needs.

The Company’s working capital needs depend on many factors, including

the overall growth of the company and the various payment terms that are negotiated with customers and vendors.

Future capital requirements

depend on many factors, including potential acquisitions, our level of investment in technology, and rate of growth in existing and into

The cost of ongoing technology development is another factor that is considered.

Capital requirements might also be affected

by factors which the Company cannot control, such as interest rates, and other monetary and fiscal policy changes to the manner in which

the Company currently operates.

Additionally, as the impact of the COVID-19 on the economy and operations evolves, the Company will continuously

assess its liquidity needs.

If the Company’s growth rate is higher than is currently anticipated, resulting in greater-than-anticipated

capital requirements, the Company might need or choose to raise additional capital through debt or equity financings.

the foregoing, DocGo anticipates that existing balances of cash and cash equivalents, future expected cash flows generated from our operations

and an available line of credit will be sufficient to satisfy operating requirements for at least the next twelve months.

as of December 31, 2021 and December 31, 2020

The tax benefit in 2022 was due to the release of the valuation allowance recorded in previous years for net operating

losses (NOLs), as the Company determined that it was now more likely than not that it would be able to realize its NOL carryforwards in

Net Loss Attributable to Noncontrolling Interest

For the year ended December

31, 2022, the Company had a net loss attributable to noncontrolling interest of approximately $3.8 million compared to a net loss attributable

to noncontrolling interest of $4.6 million for the year ended December 31, 2021.

For both periods, the loss reflected ongoing investments

in new markets that were entered into during 2021 and 2022, partially offset by income generated by those markets.

Liquidity and Capital Resources

Since inception, DocGo has

completed three equity financing transactions as its principal source of liquidity.

Generally, the Company has utilized equity raised

to finance operations, investments in assets, ambulance operating licenses and to fund accounts receivable.

The Company has also funded

these activities through operating cash flows.

In November 2021, upon the completion of the merger between Motion and Ambulnz, the Company

received proceeds of approximately $158.1 million, net of transaction expenses.

Despite the fact that the Company generated positive net

income in the year ended December 31, 2022, operating cash flows are not always sufficient to meet immediate obligations arising from

current operations.

For example, as the business has grown, the Company’s expenditures for human capital and supplies has expanded

accordingly, and the timing of the payments for payroll and to associated vendors, compared to the timing of receipts of cash from customers,

frequently results in the need to use existing cash balances to fund these working capital needs.

The Company’s working capital

needs depend on many factors, including the overall growth of the Company and the various payment terms that are negotiated with customers

Future capital requirements depend on many factors, including potential acquisitions, DocGo’s level of investment in

technology and ongoing technology development, and rate of growth in existing markets and into new markets.

Capital requirements might

also be affected by factors outside of the Company’s control, such as interest rates, rising inflation and other monetary and fiscal

policy changes to the manner in which the Company currently operates.

Additionally, as the impact of the COVID-19 on the economy and on

the Company’s market environment and operations evolves, the Company routinely assesses its liquidity needs.

If the Company’s

growth rate is higher than is currently anticipated, resulting in greater-than-anticipated capital requirements, the Company might need

to, or choose to, raise additional capital through debt or equity financings.

On November 1, 2022, the Company

entered into a revolving loan and security agreement with two banks, with one bank acting as the administrative agent (the “Lenders”),

with an initial maximum commitment amount of $90,000,000.

The revolving facility includes the ability for the Company to request an increase

to the commitment by an additional amount of up to $50,000,000, though no Lender (nor the Lenders collectively) are obligated to increase

their respective commitments.

Borrowings under the revolving facility bear interest at a per annum rate equal to (i) at the Company’s

option, the (x) the base rate or (y) the adjusted term SOFR rate, plus (ii) the applicable margin.

The applicable margins are based on

the Company’s consolidated net leverage ratio, adjusted on a quarterly basis.

The initial applicable margins are 1.25% for an adjusted

term SOFR loan and 0.25% for a base rate loan and will be updated based on the Company’s consolidated net leverage ratio.

The revolving

facility matures on November 1, 2027.

The revolving facility is secured by a first-priority lien on substantially all of the Company’s

present and future personal assets and intangible assets.

The revolving facility is subject to certain financial covenants, such as a

net leverage ratio and interest coverage ratio, as defined in the agreement.

As of the date of the filing of this Annual Report on Form

10-K, the Company has not made any draws under the facility and there are no amounts outstanding.

Considering the foregoing,

DocGo anticipates that its existing balances of cash and cash equivalents, future expected cash flows generated from its operations and

its available line of credit under the revolving facility (as further discussed in Note 9, “Line of Credit” to the Consolidated

Financial Statements) will be sufficient to satisfy operating requirements for at least the next twelve months.

Capital Resources

Comparison as of December 31, 2022 and December

As of December 31,

$ in Millions

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As of December 31, 2022, available

cash totaled $175.5 million, which represented an increase of $143.1 million compared to December 31, 2020, reflecting the receipt of

the proceeds of the Motion transaction described above.

As of December 31, 2021, working capital amounted to $198.1 million, which represents

an increase of $163.2 million compared to December 31, 2020, reflecting the increased cash balance.

Increased accounts receivable, reflecting

the growth of the business in 2021, were partially offset by increases in current liabilities reflecting the growth of the business and

resulting from extended payment terms from vendors.

ended December 31, 2021 and 2020

For the Year ended

cash totaled $157.3 million, which represented a decrease of $18.2 million compared to December 31, 2021, as changes to working capital

accounts and cash used for acquisitions in 2022 outweighed the positive cash flow generated by operations.

As of December 31, 2022, working

capital amounted to $170.9 million, which represented a decrease of $27.2 million compared to December 31, 2021, which reflected the decreased

cash balance in 2022.

Increased accounts receivable, which reflected the growth of the business and a shift towards higher credit quality

customers, who have longer payment terms, in 2022, were outweighed by the increase in current liabilities, which reflected the growth

of the business and amounts due to seller resulting from acquisitions.

Year ended December 31, 2022 and 2021

As of December 31,

$ in Millions

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Net cash provided by/(used in) operating activities

Net cash used in investing activities

Net cash provided by financing activities

Net cash provided by/(used in) investing activities

Net cash provided by/(used in) financing activities

Effect of exchange rate changes

Net (decrease) increase in cash

Operating activities

During the year ended December

31, 2021, operating activities used $1.9 million of cash, despite net income of $19.2 million.

31, 2022, cash provided by operating activities was $28.9 million, aided by net income of $30.73 million.

Non-cash charges were $11.3

million and included $7.3 million in depreciation of property and equipment and right-of-use assets, $3.2 million from amortization of

intangible assets, $3.8 million in bad debt expense primarily related to a provision for potential uncollectible accounts receivable,

$8.1 million of stock compensation expense, and a non-cash loss of $2.9 million related to the impairment of a business unit that was

discontinued at the end of the year.

These charges were partially offset by non-cash gains of $1.4 million relating to the remeasurement

of finance lease liabilities $1.1 million from the remeasurement of warrant liabilities, $1.6 million in a gain on a bargain purchase

and $9.9 million in the realization of a deferred tax asset.

Changes in assets and liabilities resulted in an approximately $13.2 million

decrease to operating cash flow, as an $8.4 million increase in accounts receivable, a $4.2 million increase in prepaid expenses and a

$6.0 million decrease in accrued liabilities outweighed the effect of a $1.8 million decrease in other assets and a $3.6 million increase

in accounts payable.

During the year ended December

31, 2021, cash used in operating activities was $1.9 million, despite net income of $19.2 million.

Non-cash charges amounted to $7.7 million,

2 unchanged sentences

stock compensation expense were partially offset by $5.2 million in a non-cash gain on the remeasurement of warrant liabilities.

in assets and liabilities resulted in approximately $28.8 million in negative operating cash flow and were primarily driven by a $57.1

in assets and liabilities resulted in an approximately $28.8 million decrease in operating cash flow and were primarily driven by a $57.1

million increase in accounts receivable arising from the growth of the business, particularly in the fourth quarter of the year and the

4 unchanged sentences

where possible, in an attempt to manage cash balances.

the year ended December 31, 2020, operating activities used $10.7 million of cash, primarily resulting from a net loss of $14.8 million,

partially offset by non-cash charges of $7.7 million.

The non-cash items included $1.9 million of bad debt expense primarily related

to a provision for potential uncollectible accounts receivable, $4.0 million resulting from the depreciation of property and equipment

and right-of-use assets, $1.4 million from amortization of intangible assets, and $0.7 million of stock compensation expense, partially

offset by a non-cash gain of $0.3 million from a write off of amounts due to a seller.

Changes in assets and liabilities resulted in

approximately $3.6 million in negative operating cash flow and were primarily driven by a $16.2 million increase in accounts receivable

and a $0.1 million increase in prepaid expenses and other current assets, which were partially offset by a $12.7 million increase in

combined accounts payable and accrued expenses.

Investing activities

During the year ended December

31, 2021, investing activities used $8.6 million of cash, primarily consisting of the acquisition of property and equipment totaling $4.8

million and the acquisition of businesses and intangibles in the amount of $3.1 million to support the ongoing growth of the business.

In addition, there was an equity investment amounting to approximately $0.7 million.

the year ended December 31, 2020, investing activities used $6.0 million, primarily consisting of the acquisition of intangibles ($1.9

million) and the acquisition of property and equipment ($4.4 million) to support growth of new transportation markets, partially offset

by $0.3 million in proceeds from the disposal of property and equipment.

31, 2022, cash used in investing activities was $38.4 million and consisted of the acquisition of property and equipment totaling approximately

$3.2 million, the acquisition of intangibles in the amount of $2.3 million and $33.0 million in the acquisition of businesses, primarily

relating to acquisitions the Company completed in the third and fourth quarters of 2022.

During the year ended December

31, 2021, financing activities provided $155.2 million of cash, due primarily to $158.1 million in proceeds from the issuance of common

31, 2021, cash used in investing activities was $8.6 million, primarily consisting of the acquisition of property and equipment totaling

$4.8 million and the acquisition of businesses and intangibles of $3.1 million to support the ongoing growth of the business.

the Company made an equity investment amounting to approximately $0.7 million.

Financing activities

During the year ended December

31, 2022, cash used in financing activities was $6.2 million, including $3.7 million in the repurchase of Common Stock, $3.0 million in

payments under the terms of a finance lease, $2.5 million decrease in amounts due to seller and $0.9 million in repayments of notes payable,

which were partially offset by $2.1 million in non-controlling interest contributions and $2.0 million in proceeds from the exercise of

stock options.

During the year ended December

31, 2021, cash provided by financing activities was $155.2 million, due primarily to $158.1 million in proceeds from the issuance of common

stock in connection with the Motion merger, which is net of $20.0 million in issuance costs.

3 unchanged sentences

quarter of 2021.

the year ended December 31, 2020, financing activities used $0.8 million of cash, as noncontrolling interest contributions were outweighed

by repayments made on notes payable and finance leases.

minimum annual maturities of notes payable at December 31, 2021 are as follows:

Notes Payable

2027 and thereafter

Future minimum annual maturities

of notes payable as of December 31, 2022 are as follows:

Amounts in millions

Total maturities

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Long-term portion of notes payable

lease payments included in lease liabilities as of December 31, 2021, and for the following five fiscal years and thereafter were as

minimum lease payments under finance leases as of the year ended December 31, 2022:

Amounts in millions

Finance Leases

2027 and thereafter

Total future minimum lease payments

Less effects of discounting

Present value of future minimum lease payments

Future minimum lease payments

under operating leases as of the year ended December 31, 2022:

Operating Leases

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Less effects of discounting

Present value of future minimum lease

Accounting Policies

Present value of future minimum lease payments

Critical Accounting

Basis of Presentation

The Company’s consolidated financial statements

are presented in conformity with accounting principles generally accepted in the United States of America (“U.S.

pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”).

The consolidated financial statements

include the accounts and operations of the Company and its wholly owned subsidiaries.

All intercompany accounts and transactions are eliminated

upon consolidation.

Noncontrolling interests (“NCI”) on the consolidated statements of financial condition represents the

portion of consolidated joint ventures and a variable interest entity in which the Company does not have direct equity ownership.

and transactions between consolidated entities have been eliminated.

Pursuant to the Business Combination, the merger

between Motion and Ambulnz, Inc.

was accounted for as a reverse recapitalization in accordance with U.S.

GAAP (the “Reverse Recapitalization”).

Under this method of accounting, Motion was treated as the “acquired” company for financial reporting purposes.

for accounting purposes, the Reverse Recapitalization was treated as the equivalent of Ambulnz, Inc.

stock for the net assets of Motion,

accompanied by a recapitalization.

The net assets of Motion are stated at historical cost, with no goodwill or other intangible assets

The consolidated assets, liabilities and results of operations prior to the Reverse Recapitalization are those of Ambulnz, Inc.

The shares and corresponding capital amounts and earnings per share available for common stockholders, prior to the Business Combination,

have been retroactively restated as shares reflecting the exchange ratio (645.1452 to 1) established in the Business Combination.

Ambulnz, Inc.

was determined to be the accounting acquirer in the transaction, as such, the acquisition is considered a business combination

under Accounting Standards Codification (“ASC”), Topic 805, Business Combinations, (“ASC 805”) and was accounted

for using the acquisition method of accounting.

The Company’s Consolidated

Financial Statements are presented in conformity with accounting principles generally accepted in the U.S.

pursuant to the rules and regulations of the SEC.

The Consolidated Financial Statements include the accounts and operations of the Company

and its wholly-owned subsidiaries.

All intercompany accounts and transactions are eliminated upon consolidation.

Noncontrolling interests

(“NCI”) on the Consolidated Balance Sheets represents the portion of consolidated joint ventures and a variable interest entity

in which the Company does not have direct equity ownership.

Accounts and transactions between consolidated entities have been eliminated.

Pursuant to the Business Combination,

the merger between Motion and Ambulnz was accounted for as a reverse recapitalization in accordance with U.S.

GAAP (the “Reverse

Recapitalization”).

Under this method of accounting, Motion was treated as the “acquired” company for financial reporting

Accordingly, for accounting purposes, the Reverse Recapitalization was treated as the equivalent of Ambulnz

stock for the net assets of Motion, accompanied by a recapitalization.

The net assets of Motion are stated at historical cost, with no

goodwill or other intangible assets recorded.

The consolidated assets, liabilities and results of operations prior to the Reverse Recapitalization

are those of Ambulnz.

The shares of common stock and corresponding capital amounts and earnings per share available for common stockholders,

prior to the Business Combination, have been retroactively restated as shares of the Company, reflecting the exchange ratio (645.1452

to 1) established in the Business Combination.

Further, Ambulnz was determined to be the accounting acquirer in the transaction, as such,

the acquisition is considered to be a business combination under Accounting Standards Codification (“ASC”), Topic 805, Business

Combinations, (“ASC 805”) and was accounted for using the acquisition method of accounting.

Principles of Consolidation

The Company’s Consolidated Financial statements

include the accounts of DocGo Inc and its subsidiaries.

All significant intercompany transactions and balances have been eliminated in

these Consolidated Financial statements.

The Company holds a variable interest which contracts

with physicians and other health professionals in order to provide services to the Company.

MD1 Medical Care P.C.

is considered a variable interest entity (“VIE”) since it does not have sufficient equity to finance its activities without

additional subordinated financial support.

An enterprise having a controlling financial interest in a VIE must consolidate the VIE if

it has both power and benefits—that is, it has (1) the power to direct the activities of a VIE that most significantly impacts

the VIE’s economic performance (power) and (2) the obligation to absorb losses of the VIE that potentially could be significant

to the VIE or the right to receive benefits from the VIE that potentially could be significant to the VIE (benefits).

The Company has

the power and rights to control all activities of MD1 and funds and absorbs all losses of the VIE and appropriately consolidates MD1.

Total revenue for the VIE amounted to $477,654 as of December 31, 2021.

The Company holds a variable

interest in an entity which contracts with physicians and other health professionals in order to provide services to the Company.

Medical Care P.C.

(“MD1”) is considered a variable interest entity (“VIE”) since it does not have sufficient equity

to finance its activities without additional subordinated financial support.

An enterprise having a controlling financial interest in

a VIE must consolidate the VIE if it has both power and benefits—that is, it has (1) the power to direct the activities of

a VIE that most significantly impacts the VIE’s economic performance (power) and (2) the obligation to absorb losses of the

VIE that potentially could be significant to the VIE or the right to receive benefits from the VIE that potentially could be significant

to the VIE (benefits).

The Company has the power and rights to control all activities of MD1 and funds and absorbs all losses of the VIE

and appropriately consolidates MD1.

Total revenue for the VIE

amounted to $2,857,463 as of December 31, 2022.

Net loss for the VIE was $373,456 as of December 31, 2022.

The VIE’s total assets, all of which were current, amounted to $481,338

on December 31, 2021.

Total liabilities, all of which were current for the VIE, was $906,444 on December 31, 2021.

The VIE’s total

stockholders’ deficit was $425,106 on December 31, 2021.

The Company made payments of $1,746,736 and $298,404 to MD1 and its

affiliates during the years ended December 31, 2021 and 2020, respectively.

The VIE’s total assets,

all of which were current, amounted to $610,553 as of December 31, 2022.

Total liabilities, all of which were current for the VIE, was

$320,424 as of December 31, 2022.

The VIE’s total stockholders’ deficit was $290,130 as of December 31, 2022.

made payments of $3,018,119 and $1,746,736 to MD1 and its affiliates during the years ended December 31, 2022 and 2021, respectively.

Business Combinations

The Company accounts for its business combinations

under the provisions of ASC 805-10, Business Combinations (“ASC 805-10”), which requires that the acquisition method of

accounting be used for all business combinations.

Assets acquired and liabilities assumed, including NCI, are recorded at the date of

acquisition at their respective fair values.

under the provisions of ASC 805-10, Business Combinations (“ASC 805-10”), which requires that the acquisition method

of accounting be used for all business combinations.

Assets acquired and liabilities assumed, including NCI, are recorded at the date

of acquisition at their respective fair values.

ASC 805-10 also specifies criteria that intangible assets acquired in a business combination

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Goodwill and Indefinite-Lived Intangible

Goodwill represents the excess of the purchase

price of an acquired business over the fair value of amounts assigned to assets acquired and liabilities assumed.

Goodwill and indefinite-lived

intangible assets, consisting primarily of operating licenses, are not amortized, but are evaluated for impairment on an annual basis,

or on an interim basis when events or changes in circumstances indicate that the carrying value may not be recoverable.

In assessing the

recoverability of goodwill and indefinite-lived intangible assets, the Company makes assumptions regarding the estimated future cash flows,

including forecasted revenue growth, projected gross margin and the discount rate to determine the fair value of these assets.

estimates or their related assumptions change in the future, the Company may be required to record impairment charges against these assets

in the reporting period in which the impairment is determined.

The Company tests goodwill for impairment at the

reporting unit level, which is one level below the operating segment.

The Company has the option of performing a qualitative assessment

to determine whether further impairment testing is necessary before performing the one-step quantitative assessment.

If as a result of

the qualitative assessment, it is more-likely-than-not that the fair value of a reporting unit is less than its carrying amount, a quantitative

impairment test will be required.

Otherwise, no further testing will be required.

If a quantitative impairment test is performed, the

Company compares the fair values of the applicable reporting units with their aggregate carrying values, including goodwill.

the fair value of the reporting units requires significant judgment by management.

If the carrying amount of a reporting unit exceeds

the fair value of the reporting unit, goodwill impairment is recognized.

Any excess in carrying value over the estimated

fair value is recorded as impairment loss and charged to the results of operations in the period such determination is made.

For the periods

ended December 31, 2021 and 2020, management determined that there was no impairment loss required to be recognized in the carrying value

of goodwill or other intangible assets.

The Company selected December 31 as its annual testing date.

Goodwill represents the excess

of the total purchase consideration over the fair value of the identifiable assets acquired and liabilities assumed in a business combination.

Goodwill is not amortized but is tested for impairment at the reporting unit level annually on December 31 or more frequently if events

or changes in circumstances indicate that it is more likely than not to be impaired.

These events include:

(i) severe adverse industry

or economic trends;

(ii) significant company-specific actions, including exiting an activity in conjunction with restructuring of operations;

(iii) current, historical or projected deterioration of our financial performance;

or (iv) a sustained decrease in our market capitalization,

as indicated by our publicly quoted share price, below our net book value.

On February 3, 2023, Ambulnz

Health, LLC (“Health”), commenced an assignment for the benefit of creditors (“ABC”) pursuant to California law.

An ABC is a liquidation process governed by state law (California law in this instance) that is an alternative to a bankruptcy case under

Prior to commencing the ABC, Health ceased business operations and all of its employees were terminated and treated in accordance

with California law.

In the ABC, all of Health’s assets were transferred to an assignee (the “Assignee”) who acts as

a fiduciary for creditors and in a capacity equivalent to that of a bankruptcy trustee.

The Assignee is responsible for liquidating the

Similar to a bankruptcy case, there is a claims process.

Creditors of Health will receive notice of the ABC and a proof of claim

form and are required to submit a proof of claim in order to participate in distribution of net liquidation proceeds by the Assignee.

Based on such filing for Health,

the Company impaired the goodwill assigned to that reporting unit as of December 31, 2022 by approximately $5.1 million.

Revenue Recognition

11 unchanged sentences

it is entitled to in exchange for the goods or services the Company provides to the customer.

The Company generates revenues from the provision

of (1) ambulance and medical transportation services (“Transportation Services”) and (2) Mobile Health services.

simultaneously receives and consumes the benefits provided by the Company as the performance obligations are fulfilled, therefore the

Company satisfies performance obligations immediately.

The Company has utilized the “right to invoice” expedient which allows

an entity to recognize revenue in the amount of consideration to which the entity has the right to invoice when the amount that the Company

has the right to invoice corresponds directly to the value transferred to the customer.

Revenues are recorded net of an estimated contractual

allowances for claims subject to contracts with responsible paying entities.

The Company estimates contractual allowances at the time

of billing based on contractual terms, historical collections, or other arrangements.

All transaction prices are fixed and determinable

which includes a fixed base rate, fixed mileage rate and an evaluation of historical collections by each payer.

The Company generates revenues from the provision of (1) ambulance

and medical transportation services (“Transportation Services”) and (2) Mobile Health services.

The customer simultaneously

receives and consumes the benefits provided by the Company as the performance obligations are fulfilled, therefore the Company satisfies

performance obligations immediately.

The Company has utilized the “right to invoice” expedient which allows an entity to recognize

revenue in the amount of consideration to which the entity has the right to invoice when the amount that the Company has the right to

invoice corresponds directly to the value transferred to the customer.

Revenues are recorded net of an estimated contractual allowances

for claims subject to contracts with responsible paying entities.

The Company estimates contractual allowances at the time of billing

based on contractual terms, historical collections, or other arrangements.

All transaction prices are fixed and determinable which includes

a fixed base rate, fixed mileage rate and an evaluation of historical collections by each payor.

Income taxes are recorded in accordance with ASC

14 unchanged sentences

of Significant Accounting Policies” to the Consolidated Financial Statements.

Quantitative and Qualitative Disclosures About Market Risk.

are a smaller reporting company, as defined by Rule 12b-2 under the Securities and Exchange Act of 1934 and in Item 10(f)(1) of Regulation

S-K, and are not required to provide the information under this item.

and Qualitative Disclosures About Market Risk.

We are a smaller reporting

company, as defined by Rule 12b-2 under the Securities and Exchange Act of 1934 and in Item 10(f)(1) of Regulation S-K, and are not required

to provide the information under this item.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 7. Management’s Discussion and Analysis