Company: HCTI
Filing Date: 2025-03-31
Form Type: 10-K
Source: 0001213900-25-026218
Chunk: 489

Company: Healthcare Triangle, Inc.
Filing Date: 2025-03-31
Form: 10-K
Item: Item 3
Chunk 489
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The revenue from solutions delivery model contains
a series of separately identifiable and distinct services that represent performance obligations that are satisfied over time. During
the periods presented the company generated Platform revenue on solution delivery model only, which is non-recurring revenue.

Our SaaS agreements will be generally non-cancellable
during the term, although customers typically will have the right to terminate their agreements for cause in the event of material breach.

SaaS revenues will be recognized ratably over
the respective non-cancellable subscription term because of the continuous transfer of control to the customer. Our subscription arrangements
will be considered service contracts, and the customer will not have the right to take possession of the software Segment wise revenue
breakup.

Cost of revenue

Cost of revenue consists primarily of employee-related
costs associated with the rendering of our services, including salaries, benefits and stock-based compensation expense, the cost of subcontractors,
travel costs, cloud hosting charges and allocated overhead the cost of providing professional services is significantly higher as a percentage
of the related revenues than for our subscription services due to the direct labor costs and costs of subcontractors. Our business and
operational models are designed to be highly scalable and leverage variable costs to support revenue-generating activities.

While we may grow our headcount overtime to capitalize
on our market opportunities, we believe our increased investment in automation, electronic health record integration capabilities, and
economies of scale in our operating model, will position us to grow our platform solutions revenue at a greater rate than our cost of
revenue.

37

Operating Expenses

Research and development

Research and development expense (majorly our
investment in innovation) consists primarily of employee-related expenses, including salaries, benefits, incentives, employment taxes,
severance, and equity compensation costs for our software developers, engineers, analysts, project managers, and other employees engaged
in the development and enhancement of our cloud-based platform applications. Research and development expenses also include certain third-party
consulting fees. Our research and development expense excludes any depreciation and amortization.

We expect to continue our focus on developing
new product offerings and enhancing our existing product offerings. As a result, we expect our research and development expense to increase
in absolute dollars, although it may vary from period to period as a percentage of revenue.

Sales and marketing

Sales and marketing expense consists primarily
of employee-related expenses, including salaries, benefits, commissions, travel, discretionary incentive compensation, employment taxes,
severance, and equity compensation costs for our employees engaged in sales