Teladoc continues to see surging demand for its virtual care services even as the use of telehealth across the country has slowly declined from hitting peaks in April.
Teladoc, one of the nation's top telehealth providers, reported 2.8 million total virtual visits during the third quarter, up 206% from 928,000 visits in the third quarter of 2019.
Total telehealth visits in 2020 have jumped 163% from 2.9 million visits during the first nine months of 2019 to 7.6 million visits this year.
Third-quarter revenue soared 109% to $289 million from $138 million during the same period a year ago. During the first nine months of 2020, revenue grew 79% to $711 million, company executives said during a third-quarter earnings call Wednesday.
The company's third-quarter revenue beat Wall Street estimates of $282 million for the quarter.
The telehealth giant is now projecting its full-year 2020 revenue to reach just north of $1 billion, up 82% from $553 million in 2019, according to Teladoc Chief Financial Officer Mala Murthy.
Teladoc reported U.S. paid membership in the third quarter totaled 51.5 million users, up 47% from 35 million users in the same quarter in 2019.
“Our strong third-quarter results exceeded expectations, driven by broad-based strength across the business and building on the momentum we saw in the first half of the year,” Teladoc CEO Jason Gorevic said during the earnings call.
With Teladoc's acquisition of Livongo, announced in August, the company's value proposition in the marketplace is only getting stronger, Gorevic said.
"Together with Livongo, we have created an unmatched combination of scale and insights, driving improved outcomes, lower cost, and a better consumer experience," he said.
Teladoc and Livongo, which went public a year ago, have both experienced explosive growth during the COVID-19 pandemic as consumers have turned to virtual care options.
Livongo, a chronic condition management company, also reported third-quarter results Wednesday. The company reported third-quarter total revenue of $106 million, up 126% year over year from $47 million during the same period in 2019. Livongo for Diabetes members increased 113% year over year to over 442,000, marking an increase of over 235,000 members on a net basis from 208,000 members in the third quarter of 2019, according to the company.
Gorevic said the deal with Livongo creates an "entirely new category" of virtual care companies.
"We are distancing ourselves from the legacy telehealth players. Our competitive takeaways are increasing in velocity and that's happening across multiple channels, employer and health plans, as well as the hospital and health system channel. I have never felt better about the competitive landscape and our competitive position," he said.
Teladoc's clients are looking for a single integrated solution that brings all assets of the two companies together for episodic, chronic and complex care, he said.
The company has signed two major cross-selling agreements since the announced acquisition, including with Florida Blue, a subsidiary of GuideWell Mutual Holding Corp., and the Blue Cross and Blue Shield plan of Florida. Teladoc also announced new partnerships with Johns Hopkins University and Spanish telecommunications company Telefonica.
Teladoc's business is booming even as in-person visits to doctors' offices have started to rebound to pre-COVID-19 levels, according to a report from the Commonwealth Fund.
Looking at data visit volume for more than 50,000 medical practices, telehealth visits as a percentage of visits hit a peak of 14% in April and now has fallen to around 6%, which is still above pre-COVID-19 levels.
"We see in many parts of the country, office visits returning to near-normal levels, and at the same time, people are accessing Teladoc for a broader array of clinical services," Gorevic said.
Visits for conditions such as hypertension, back pain, anxiety, and depression represent over half of Teladoc's general medical visit volume, up from approximately one-third a year ago, he said.
More details on Q3 financial performance
Out of its $289 million quarterly revenue, revenue from subscription access fees came to $227 million, up 98% from the third quarter in 2019, while total visit-fee revenue reached $51 million, up 171% from the same period in 2019.
However, the company grew its sizable net losses during the quarter due to $16 million in transaction costs related to the Livongo deal. Teladoc reported a loss of $36 million in the third quarter, which grew from a net loss of $20 million during the same quarter a year ago.
Excluding $25 million of transaction costs related to the pending Livongo deal and the acquisition of InTouch Health, net loss for the quarter was $11 million, the company reported.
Net loss per basic and diluted share was 43 cents for the third quarter of 2020 compared to a loss of 28 cents for the third quarter of 2019. That missed Street estimates of a net loss per share of 32 cents for the quarter.
Excluding transaction costs of 30 cents per share related to the pending Livongo deal and the acquisition of InTouch Health, net loss per share was 13 cents for the third quarter of 2020. That beat Wall Street projections by 18 cents.
Murthy said the company expected fourth-quarter 2020 revenue between $294 and $304 million, up 88% to 94% from revenue of $156 million in the fourth quarter of 2019.
The company is expecting total U.S. paid membership for full-year 2020 to be in the range of 50 million to 51 million members and visit-fee-only access to be available to between 21 million and 22 million individuals. Total virtual visits are expected to reach between 10.4 million and 10.6 million for the year.
In the fourth quarter, Teladoc is expecting net loss per share, based on 84.4 million weighted average shares outstanding, excluding all transaction costs related to the pending Livongo acquisition, to be between 36 cents and 33 cents.
For full-year 2020, the company expects a net loss per share, excluding all transaction costs, based on 79.4 million weighted average shares outstanding, to be between a loss of $1.36 and $1.32.
Teladoc is expecting earnings before interest, taxes, depreciation and amortization to range between a loss of $1 million to a gain of $2 million.