Teladoc continues to prosper from the boom in virtual care as revenue in the second quarter surged 85% to $241 million.
Teladoc, one of the nation's top telehealth providers, reported total virtual visits increased 203% to 2.8 million during the second quarter.
In its U.S. market, the brief period of national COVID-19 containment in late May and early June provided visibility into continuing demand for virtual care, with utilization stabilizing at a level 40% higher than before the pandemic, company executives said during a second-quarter earnings call Wednesday.
In several southern states where COVID-19 case volumes have accelerated, Teladoc is seeing a significant spike in demand with visit volume exceeding the initial peak levels in March and April, Teladoc CEO Jason Gorevic said during the call.
“We are also seeing sustained demand in areas that are no longer considered hot spots. In some states where the curve has flattened, we are still seeing twice as many patient visits as last year,” he said.
Teladoc's second-quarter revenue beat Wall Street estimates of $220 million for the quarter.
Shares of Teladoc rose 2.81% after the company reported second-quarter results. Teladoc shares have jumped 164% year-to-date, according to Forbes.
The Purchase, New York-based company significantly raised its forward guidance for full-year 2020. Teladoc expects 2020 revenue between $980 million to $995 million, up $170 million to $180 million from the previous range, Gorevic said.
At the top end, that's around an 80% jump from its 2019 revenue of $553 million.
"There’s no doubt that the ongoing pandemic shines a spotlight on the integral role virtual care plays within the healthcare system," he said. "The pandemic has accelerated the widespread adoption of virtual care and I’m confident there’s no going back."
"The tremendous momentum and demand that we're seeing across the business for our comprehensive product offering including an impressive pipeline of new opportunities gives us confidence in providing a preliminary outlook of 30% to 40% revenue growth for 2021," Gorevic said.
In the first half of the year, Teladoc onboarded nearly 15 million new paid members, including 8.5 million new paid members during the second quarter.
Demand for specialty care including virtual mental health visits also continued to show rapid acceleration.
Employers are increasingly interested in virtual care offerings as Teladoc recently signed a contract to provide its entire suite of clinical services to a Fortune 50 media company with well over 100,000 employees, Gorevic said
The company finalized its acquisition of InTouch Health on July 1 at a purchase price of approximately $150 million in cash and 4.6 million shares of Teladoc common stock.
The addition of InTouch Health solidifies the company’s leadership in hospital-based telemedicine and is projected to grow over 35% in 2020, company executives said.
The company also launched a virtual primary care pilot in the second quarter. Teladoc is having conversations with large employers and payers about leveraging the virtual primary care service and expects to launch it commercially in the first half of 2021, Gorevic said.
More details on Q2 financial performance
Teladoc reported U.S. paid membership in the second quarter totaled 51.5 million users, up 92% from 26.8 million users in the same quarter in 2019.
The number of members in the U.S. with visit-fee-only access rose 125% from 9.7 million members in the second quarter of 2019 to 21.8 million members in the second quarter of 2020.
Out of its $241 million quarterly revenue, revenue from subscription access fees came to $182 million, up 64% from the second quarter in 2019, while total visit-fee revenue reached $59 million, up 209% from the same period in 2019.
The company has yet to turn a profit and still has sizable net losses—$98.9 million for the full year in 2019, which grew from a net loss of $97.1 million in 2018. Net loss per share was $1.38 for full-year 2019 compared to $1.47 for full-year 2018.
The company's net loss for the quarter was $25.7 million, down slightly from $29 million in the second quarter of 2019. Net loss per share for the quarter was 34 cents compared to a net loss per share of 41 cents in the second quarter of 2019. That missed Street estimates of a net loss per share of 23 cents for the quarter.
Chief Financial Officer Mala Murthy said the company expected third-quarter 2020 revenue between $275 million to $285 million. That represents growth between 100% to 106% compared to the same period in 2019.
The company also expects strong growth in its virtual visits in the third quarter, which are projected to reach between 2.5 million and 2.7 million
In the third quarter, Teladoc is expecting net loss per share, based on 83.4 million weighted average shares outstanding, to be between 35 cents and 30 cents.
For full-year 2020, the company expects net loss per share, based on 79.6 million weighted average shares outstanding, to be between $1.45 to $1.36.
Teladoc is expecting a loss based on earnings before interest, taxes, depreciation, and amortization of $6 million to $13 million.