Teladoc Q1 revenue more than doubles to $454M as telehealth visits continue to climb

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During a first-quarter earnings call Wednesday, Jason Gorevic, CEO of Teladoc Health, said the company was making considerable progress on the integration of digital chronic condition management company Livongo. (Teladoc Health)

Teladoc's first-quarter revenue reached $454 million, jumping 151% from $181 million a year ago, driven by growth in specialty offerings and multi-product contracts.

Despite a historically weak flu season, the telehealth giant delivered 3.2 million virtual visits in the first quarter of 2021, up 56% compared to the first quarter in 2020.

During a first-quarter earnings call Wednesday, Jason Gorevic, CEO of Teladoc Health, said the company was making considerable progress on the integration of digital chronic condition management company Livongo. Teladoc acquired Livongo in a massive $18.5 billion deal in October.

Earlier this month, the company launched the first wave of members to access and register for Livongo programs within the Teladoc app, marking "the first step to creating a seamless member experience to engage with members more effectively across programs," Gorevic said.

The company also launched medical group referrals into chronic care management programs and a major new contract with a regional Blue Cross Blue Shield plan on the East Coast.

“After a transformational year, Teladoc Health continues to show strong momentum by delivering record results across the business,” Gorevic said. “Consumers are embracing our whole-person virtual care offerings, engaging with multiple products and coming to us for more of their health needs. As our integration accelerates, we are leading the way in whole-person care, unlocking the full spectrum of healthcare in one unified and personalized consumer experience.” 

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"We continue to see significant strength in non-infectious disease and specialty visits with mental health volumes, in particular, driving growth in both business-to-business and direct-to-consumer channels," Gorevic said. 

The number of consumers enrolled in more than one chronic care program tripled year over year, which indicates users are choosing Teladoc Health to meet broader health needs beyond urgent or episodic issues, according to company executives.

Membership in the Livongo chronic care suite of products grew 66% over the prior year, as Teladoc added 62,000 new chronic care members in the quarter, Gorevic said.

With over 40% of adults in the U.S. living with more than one chronic condition, the opportunity is significant, he said.

"Clients are looking for comprehensive multi-product solutions. They're not looking for point solutions that they have to integrate themselves to stitch together and get the benefit of that," Gorevic said, noting that the combined capabilities of Teladoc and Livongo gives the company a competitive advantage in the market.

Teladoc ended the quarter with U.S. paid membership of 51.5 million members, an increase of 20% over the prior-year quarter. 

The company's quarterly revenue beat Wall Street estimates of $452 million.

The company raised it's second-quarter and full-year guidance based on its continued strong growth. Teladoc raised its full-year revenue guidance by $20 million to $1.97 billion to $2.02 billion. The company expects total virtual visits between 12.5 million and 13.5 million for the year, Chief Financial Officer Mala Murthy said.

Total U.S. paid membership is expected to rise to between 52 million and 54 million members.

Out of its $454 million quarterly revenue, revenue from subscription access fees came to $388 million, up 183% from the prior year's quarter, while total visit-fee revenue increased 24% to $54 million.

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The virtual care company reported a wider than expected net loss in the quarter.

Earnings per share in the quarter came to a loss of $1.31, which missed the Wall Street estimate of a loss per share of 57 cents.

The company grew its sizable net losses due to stock-based compensation expense of $86 million, up $68 million from the first quarter of 2020, substantially reflecting higher expense associated with Livongo stock awards that continue to vest after the merger, Murthy said. 

Teladoc's net loss in the first quarter also includes amortization of acquired intangibles of $45 million and a non-cash income tax charge of $87 million related to transaction costs from the Livongo and InTouch Health deals.

Teladoc reported a loss of $200 million in the first quarter, which grew from a net loss of $30 million during the same quarter a year ago. 

Second-quarter 2021 total revenue is expected to be in the range of $495 million to $505 million, and the company is projecting total U.S. paid membership will be in the range of 52 million to 53 million members.

Teladoc expects to deliver more than 3.2 million virtual visits in the second quarter, possibly up to 3.4 million.