TDOC - Earnings call transcript Q1 2022

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Operator

Good afternoon. Thank you for attending today's Teladoc 2022 First Quarter Earnings Conference Call. My name is Nate, and I will be your moderator for today's call. All lines have been muted during the presentation portion of the call with an opportunity to questions at the end. [Operator Instructions], I'd like to now pass the conference over to our host, Patrick Feeley, with Teladoc. ahead. go please Patrick,

Patrick Feeley

presentation good call press after Officer. Mala quarter release press Jason teladochealth.com Executive accompanying results. and Relations Chief the we of Gorevic, discuss section XXXX market Chief the issued Murthy, This the slide the and a announcing On release and available afternoon. you Financial on the Investor this Today, website. closed, financial are to Thank Officer; our are first results

provide to a our that outlook, we Details also GAAP measures quarter Please this the Teladoc we measures and be important are remarks and XXXX will During Health's reconciliations financial discussing call, that year thereof second and will on full we in certain in note be between performance. will relationship can be evaluating question-and-answer prepared measures most non-GAAP the our followed found by comparable believe non-GAAP Such is session. certain XXXX. by Also, Securities that as website. defined Reform posted the forward-looking implied Teladoc the results our during subject release statements be statements will to and of expressed Act Health actual made those materially press call differ Litigation statements the from for on that could this risks, forward-looking on other or that Private note uncertainties factors are call. cause please to this these

available of to to are in release like and press call which over cautionary our our would our information, the additional Jason. statement to with SEC, refer the For all our please website. turn filings now on I

Jason Gorevic

to report guidance met thank you adjusted for Thanks, us. for EBITDA. Patrick. I'm and our joining and we Good pleased Well, that QX revenue afternoon

EBITDA we this our in and our release full year. As the revenue for you afternoon, revised outlook down saw earnings adjusted

our currently health out of most Coming influenced direct-to-consumer context brand in the in care think outlook the are business. our Teladoc health seeing my how for spend continues to space. we quarter, I markets be of do I'll and prepared have broader chronic revised XXXX, of market mental discussing to it's the dynamics the the comments so important leading digital the first do in Although

consumers fundamentals strong $XXX million leaves new delivering the to our We over interact Our prospects healthcare with build interactions committed with strategy. system. and market in solutions our to confident balance and remain sheet whole-person health. by leadership way upon the confirm scale, and the positioned well to innovative is in unmatched solid us that And transform our cash it of digital clients future with care

we're I'll our matures, their progressive is notable areas integrated that But we healthcare our embracing that what's services the in momentum some my of for if even seeing most growth our As our in clients see level growth remarks. than the prior across is all to approach expectations. needs. industry lower speak continue to later

remain lower high you think fast. delivering innovation member necessary the making ahead PrimaryXXX disappointed ongoing Teladoc on moving investments full our about is on to remain guidance several for offering to delivering list. our experience enhancements the certainly As market road committed of today. because last-mile and Health, and We're integration to that Achieving we

XXXX, time outlook we for healthcare us health direct-to-consumer However, the let balance mental experience. transform starting With service, best we're technology and led our positioned spend to me reassess our to company BetterHelp. to with in continue healthcare believe some that, through the the walking of what

advertising, acquisition think and experienced with where several believe strategies are exiting dynamic in which spend the XXXX weeks, is pursuing this yield we've paid past online in trends we no-return a attempt part we've for BetterHelp, on competitors is this the smaller in of increase XXXX. the Over biggest is notable keywords early example we the reversal lower-than-expected establish One of marketing a customer of market seen for private search of share. rates associated an driver what We therapy. low- to seen or

of dynamic is the controlled this we same direct-to-consumer returns. growth No the The in acquisition that strategy. however, in a and growth And We likely in in than below drive scale are Furthermore, Some continue the at are channels health those of BetterHelp. the members while member This the that year, investing more left operate BetterHelp margin can resulting remaining allows suspension at with unlike national to to long-term. news persist disciplined throughout associated providers us we years in strategies our within remainder has least is better of expectation both substances. our push prescription and concerning single is believe emergency these also from temporary smaller to unsustainable acquisition XX% contribution environment. operate participants, certain regulations growth February. exploiting channel this in our acquired for the market market strong of that to good newly for to recent of diversify accounts drive us positioned customer

source So as than on paid of for a less reliant in members the we example, past. new search are

While year. assumed dollar a expect the backdrop, strong drag to full continue past updated an the the including To weeks albeit broader the of and over quarter dynamics clear, outlook, contribution view revenue prior XX% given incorporated trends modest persistency per and into our we of lower in ad below our yield BetterHelp, from the we've several expectations. first spend revenue, economic the direct-to-consumer market be growth for on these forward were our only this margin

year. client on our of and more launches deals growth range the we XX% cadence upper care, Our revised of onboardings over the to health health the other last of XX% XXXX have we We assumes In that for client revenue from signed guidance population revenue grow per chronic range the of course on large target plan recently clarity for remain for with this XXXX. discussed quarter. track mental will BetterHelp long-term in half

chronic marketplace that to seeing the in leading two pipeline saw elongated than we cycle. selling our we also we're slowly discussed care Last an more trends developed October, sales However, anticipated.

return on in work, was first was which to where we to the and managers we longer saw The employer process. felt a benefit market, decision-making COVID contributing focused

large second of were it clients. health very by to fourth bookings a plan the complexity this of given robust simply quarter The a size harder deals pipeline. and were to when the late-stage beginning comes predict encouraged was At pipeline those we that timing year, of strong and

signs through part of However, the the as first we slower pace year, the continuing. seeing bookings we're progressed clear of

new In created we're seeing discussed point solutions, fall, clients number with factors addition noise has to we a the the marketplace. of smaller which last inundated in

we'll this in near are pipeline near-term virtual the as to broad process the our and delivery taking advantage in to look we revenue, a digital conversion be closer is care that Teladoc necessary persist. to In competitive integrated to address meantime, believe in make positions space. we approach impacting of the the We noise these adjustments that of at the winner to expect While long-term to some and the of are continue term forces a them.

year, first the So the the we're the but pace pipeline progress based while our significantly how to seeing that grown year, pipeline season, we early it still forecast. of quarter, the we to of over as the expected. update It's at compared and as prudent first has has the not deals of felt selling the last quarter first is developed pipeline of late-stage the large end on somewhat four was in the months

we've percentage XXXX discussed, at growth from impact care approximately lower of chronic lower guidance growth revised the reduction primarily with the expected to mid-teens. to a remainder to our revenue outlook XXXX revenue our expected When attributed BetterHelp from just suite driven chronic Our of the is the low revenue items products. the assumes guidance on quarters by care basis the to three in comparing

development. approximately from due headcount the lower on technology EBITDA, adjusted wage thirds our increase and we For assumption the revision is is higher our well outlook in in growth by a of primarily to of driven lower reduction grow inflation as BetterHelp. chronic driven for revenue spend The two our modest advertising care yield as as by remainder

we expect appropriately reasonable year $XXX potential for and result revenue $X.X adjusted these $X.X million the We a updates, million believe risks billion ranges to of As to of upside. and XXXX. now EBITDA $XXX capture of these billion fiscal

not growth outlook. revenue with we're respect and guidance whether XXXX, periods our any to today evaluating are after long-term to effects providing there We will be

As confident at remain the the the despite I in our said leader in we of the change top call, health in outlook, space. XXXX as the digital position our

those depth market-leading for of the Our the breadth key bring And clients underpin to is and solutions to our broad our capabilities. needs full set integrated meet market strategy capabilities that members. advantage and of competitive

our Teladoc's providers a opens It care upon to needed. deliver designed act that against key with as pathways and digital health is quarter, of virtual virtual the ability our to third-party front PrimaryXXX. A we to whole-person door care for members. or the our own continue care progress plan to virtual network within During linchpin PrimaryXXX when the product, coordinates promise and solutions is first employer's market-leading primary whole-person care ecosystem of strategy. of make to

with about of to members. employers continue pipeline are mental notable look and expect our make plan deals. health chronic in through We more plans we support through models telehealth, important strong we whom many health moving our we've months, seen of to a seeing additional care convenient particularly And of solutions the deals we're I announce PrimaryXXX with to interest the the to to their primary suite excited of rest be PrimaryXXX. populations whole-person to We've provide their over as PrimaryXXX made health combine pipeline. that accessible. condition create growing care two about Last Virtual progress deals the and past quarter, looking innovative and the talked momentum from year have for First as PrimaryXXX progress clients,

which the and patient's value our clients over virtual underscores call one among directly integrated our Microsoft review virtual platform, leverage Health, competitor the as XXX announced outpatient you of New incumbent care New York and Northwell X single recently and This are area With I'll operate streamline of XX York's all cases. also of will deal Northwell quarter within guidance. clinicians. home. care with facilities power platform with in for hospitals will turn Northwell emergency use familiar for the Microsoft care with a clinical and collaboration our and unseating partnership important to within first our Northwell's demonstrates with that, their that high-acuity provider-to-provider to facilities. integrated walls also and strategy Many an provider of spans metro applications for process. into and Mala health both the an communication relationship the We to the allows our platform Northwell leverage enterprise of partnership largest Northwell's new the the in over consumer

Mala Murthy

Jason. you, good Thank everyone. And afternoon,

in access first XXX,XXX chronic During of over XX% XX.X an to $XXX only first enrollment of XX% growth from our an increase was increase the Average an to our quarter, of than number membership for in more U.S. total chronic of of of XX,XXX an XX.X XXX,XXX members, at substantially revenue the members helped prior ended prior in visit the The total organic. as increase revenue up are year. members more than revenue over individuals. year-over-year. per first quarter XXX,XXX care quarter, all our the one quarter up member Visit XXX,XXX, with enrolled million chronic now quarter, the that year's the million U.S. members one quarter the $X.XX $XX over was XXXX. drive from XX% the month of per of of the in quarter. over program, was increase enrolled This fee fee prior the year-over-year, year's of first or million end in representing XX% total increased quarter. increased XXX,XXX program care care with was of $X.XX the quarter, Individuals of programs first We of quarter. XX% or the XX% enrollees more fourth paid unique million first

compared up the clinicians, growth first was quarter, visits mental million year's million year's end to of and EBITDA of this in $XX.X health our the range. the $XX.X guidance our strength prior the in provided prior During quarter quarter over million was contributor through quarter. the high XX% in The utilization. biggest Adjusted first X.X first at to we network

first quarter a $X.X related included reminder, adjusted our purchase a EBITDA benefit adjustments. As million to XXXX accounting

peer consistent discount companies or group $X.X Teladoc of care and seasonality decreased of was less a first call, quarter's charge impairment holiday and the to this lower non-cash spend lower take well year. billion. loss updates pandemic. to factors, increased the per loss a of in onset of the the last a stock-based valuation compared cash As It's share in and revised see conclusion discussed first this XXXX, market-based in The rate multiples the the that market Net first and $X.XX quarter market goodwill combination our expensive per sheet. as in balance flows was quarter year. loss Health was on share. during in of share was and share more of due of first today. the quarter sustained that the net per with short size in for in to on recent net the pricing charge forecasted of in us advertising the for in margin compensation share weaker a health digital by loss it's advertising such $X.XX was of $XX.XX media goodwill $X.XX to of as price and per investments as the guidance driven amortization triggered typical share relevant the advantage note season, of an high-growth ramp-up $XXX per following impairment cash case we We impairment of decline important million as a $XX.XX by quarter pronounced the acquired Net quarter a with share included per a intangibles disclosed the term last includes per with the to ended share expense Also

Now forward guidance. turning to

the For be growth billion XX% we of to year $X.X in range $X.X billion, prior year. over XX% of expect full to revenue the representing XXXX, to the

members, XX of X% We X% expect growth total member. by with the driven remainder to million million per revenue to U.S. paid membership revenue expanding growth of XX of representing year-over-year

growth to XX% XXXX XX.X XX% in between to visits of the total million expect representing prior XX.X year. million over and We be visits

to be the XXXX XX% in after $XXX of of an purchase range expect for in EBITDA million $XXX We representing a to adjusted accounting EBITDA margin margin compared XX.X% XXXX in adjusted to price normalizing million of year’s last benefit. XX%

of modest lower decline primarily function inflation. our As in a in is margin consolidated expected suite chronic BetterHelp results wage and a products the for expected discussed rate increase care of and

For over we the growth of call, the of on continue prior the we be our year’s the more of to $XXX revenue $XXX million, quarter, representing year. expect second contrast new XX% to of XX% to discussed earnings weighted quarter in XXXX, million back years, cadence expect the to to chronic as half to prior last of care enrollees heavily

between total We million visits million are quarter year to expect XX to XX U.S. be growth XX% in of of second the million Total XX%. visits year million. paid second X.X X.X representing expected quarter to over and membership

from to that, remarks. chronic and second increased new EBITDA launches. lower engagement be for support care contribution sequential in back The expect spending a primarily adjusted mental direct-to-consumer to of $XX a range adjusted function We in population Jason turn quarter will second lower call of the expected EBITDA to With I in XX quarter is the the of million. closing health,

Jason Gorevic

We a hold high standard. with there's outlook Mala. we're to And revised no Thanks, question disappointed today. our ourselves

and as mentioned person one. I offering approach is that our depth unmatched. we However, highly integrated earlier, remain right our integrated of product is confident the breadth The whole

built can We've experience efficient in comprehensive promise execute that for deliver set more industry, the consumers. like leader the a broadest the methodically only clear better As integrated truly care clients the we solutions outcomes, and ours believe and the of upon and market for the to of better With operator? capabilities we'll that, expand digital innovate the opportunity to lead health those virtual against our questions build upon ahead. tremendous call open and we'll capabilities and continue And in today. available

Operator

Your Instructions] is from Absolutely. Lisa Gill question Our [Operator is Lisa first JPMorgan. with open. line

ahead. You go can

Lisa Gill

really Thanks a on bit here. health what's I very Jason, happening the understand detail. discipline keep parts but for area. I'll to my the much. in multiple to better have And just thanks question mental might I area, want little

Is last as being on mental is margins I about as coming basis health customer demand roughly I driven and about know far thirds acquisition the are the what you of competition for more and points one, customer all are being think a from XXX few impact cost incrementally and but if little much that what we down I bit expectations then higher -- versus thirdly, two EBITDA And before, when weeks were the as spending we costs, BetterHelp. talked even clinicians? paid on searches higher. at wages, that acquisition you called this You out your Mala the side Two, you look about seeing the talked competition? based where revised

Jason Gorevic

Yeah.

So in we overall margin talk the that I'll I And for that It's on decisions. we is that outlook what and environment talk The over look the to be -- give our outlook seeing into lower-than-expected terms you spend competitors the BetterHelp to money seeing consider And adjusted business, represents the direct-to-consumer and still an in that competitive the When are paid able economically and past the smaller first weeks. for well our search, landscape growth on in a from we're is and yield capital I'll cost one dollar. of began somewhere can for in end XX% in and paid January 'XX that members of number a our marketing drove I news at we're Mala space versus health search, really acquired the In a the and February, what we corresponding irrational in us saw March, line with and mental back and as see But expectations, newly several There pull business. say high the member heard February, EBITDA. rash which quarter. at on primary turned paid against search new with number BetterHelp. the of to decline acquisition increases revenue were our in trending per decline without from that: December. to per yield and us cost good funded is my private channels you in of two we was around have we prior advertising that recently our is XX% as social range we attribute would and sort strongly January up March to been acquired comments, that and two venture paid flowing business. CPA media. making expect of and our example. I decimating who would between XX% look

that today second telehealth, companies. actually that mental my national substances some may know the suspension and from for Obviously, Walgreens prescription substances that were telehealth, of during CVS of exploiting And emergency. article do seen regulations Journal we ironically companies fill saw and I controlled have part remarks referenced other using to health in the So controlled prepared some about the don't to the an in prohibit we that relates I Adderall you direct-to-consumer believe specifically the we are -- temporary that. the prescriptions

just is more Neither acquisition change growth EBITDA. of for availability outlook led one competitors profitable growth And practices in on it's BetterHelp, on controlled in on those about the outlook think the and going suspensions increase constraint the long-term access rest a Maybe and prescribing our better about comment in focus a things: then are auctions can bit us a regulations. Lisa, sustainable for at inflation substances our up talk that two one asked those for continue search do. we're adjusted We is on to those either bidding wage of this a running don't business. -- customer and to competitive practice. facing of the For to a those disadvantage who to Mala BetterHelp. either relative those that the it's Really, or worse, who or puts of or exploiting of the clinicians overall you year.

Mala Murthy

as to your -- relates it address question Lisa, And as Yeah. profit the to me BetterHelp well. question and let overall

thirds of made we guidance adjusted well have So the remaining care EBITDA as revision driven prepared by chronic the our is by the increase talked about The is third we BetterHelp. wage as in in approximately one a in as inflation. modest remarks, driven two to --

is lower about about reduction -- the increase BetterHelp, XX%. margin is really talked for yield. so than And CPA the about of in expected We

To the the thing for in to as is margins So driving said, BetterHelp would a -- and you of yield. be revenue that think we spend. and what reduced directly one attractive is about in asked, through just the say spend BetterHelp it's less as clear, enterprise think it financials means similar how the increase from spend you CPA, the are means -- It if vis-à-vis The question the margin. you still margins. I marketing it's about flowing lower ad our because

Operator

you, Thank Lisa.

Daniels is question next Ryan line Our goes with open. William Blair. to Ryan, your

go You ahead. can

Ryan Daniels

a becoming in more part telehealth their noise? this difficulty the headwind with larger Is that for in a my guys. to offer little that seen follow-up I dive other to care weakness we've Yeah, Thanks with it of attention with guess of combining taking to provide lot that getting care truly you well? would my similar is companies the it Or a space I'm bit form Thanks. return really for the the such that more a that somewhat work of transitory more competitive solutions. is questions. the into Is they to hoping curiosity more. can navigation more providers also employers health of on-site resources you deal regarding And is management. the some the be telehealth, as in as guess I segment? think of that chronic funding market

Jason Gorevic

the us, long pipeline seeing I'll the later taking what Yeah. the said that unfortunately to that market we're to in dynamics And various deals through of go cycle. continue we are, believe and are reiterate before, sales chronic care larger I'll just for Thanks, the close. I a elongating stage see we Ryan. get question. Appreciate that to

return we positive a late-stage work, few trends. back of on benefit for COVID side a managers the about fourth quarter pipeline to with very XXXX first Also, quarter that that, in is a and persisted Certainly, by the exited believe we October, record bookings distracted the that continuing. we in into strong quarter. and So talked us,

As to consider. seeing deals the closure we're not if get the that, that those as is year, in line. just competitors we elongate. moved are noise of say, the to of the of process through essentially, would the step also first and because terms middle of months continues I I I buyer sales the is to think some that about more competitive more few caught giving back, things little believe that bit very strongly a time in we're There

in we offerings. phase I a individual solutions point So integrated are to multi-condition whole-person, transition buying buying from true buyers think

on solutions. -- single our but point Livongo historically, solutions months, as whole-person over in of organizations the We experience. the And that the we're not care we've products last organizations, not multi-condition, yet. head-to-head point with care basis whole-person been Livongo solutions our as admittedly, against legacy also various with full on And competed really done integrating working into XX-plus the market

PrimaryXXX well and our responding the early points of and We and to And are it fact have to really reception I in I seeing, we're that the that we're other is it. think product we think of strength feedback. as line line, is the we that of We're the the evidenced great deep were first by getting behind into sales. not we're our market But don't it. quarter, And getting in sight process. to have that. what still we're XX% evidence finished with The of but the sales that multiproduct because finish process, proof

the that's to continue committed to we're the really completing in multi-condition invest we're unified that. delivering that we're to solution So multidimensional, convinced And a to going integration, market. strategy. And right the

to of at the as impacting the confident term, in of for we rest taking pipeline, to some outlook to year, of disappointed conversion are In do address we’re our necessary a the market. remain and while and look our dynamics our the we position meantime, adjustments performance with are them. continue the this and strategy that closer going the our make we're in So in the near

Operator

Thank you, Ryan.

question goes Sandy, is next Draper Guggenheim. Our your to open. with line Sandy

go can ahead. You

Sandy Draper

Ryan. of question much. very Jason, sort maybe, And a to Thanks just related

One of is in been inflation wage I've the things to this environment. trying through think

think As cetera. to the just that to to understand happening there's higher that's think wages, to et do it but you I trying environment, additional of, may do cost marketplace. of to they Do in And Thanks. attract be on the talent, a they're these pay think sense that's any to cash lot upfront. I'm said, a sense signing higher going impacting because saying, order on trying about there's you to wanting if out is pay bundled as a larger willingness buys, -- you have bonuses, to dynamic services out a add higher? people's in to long-term, human may there maybe you resources, dollar this people people bonuses, have sense, in not people make we're them having get or board to

Jason Gorevic

primary of not driver through employers to people a their making employers understand Yeah. is a will that's don't It Sandy. decision. I making of -- more possible I health Thanks, that think make question. drive purchase the plans. decisions that,

of products we One make and health with for going allocating to the think to into acquisition that we have respect seeing end these their HR these through may buying is with much resignation areas return self-insured health employers resources overall office, the to hiring because I to on second the all sales their more plan seeing that, think plans seeing significant do up there's getting that health that solutions talent traction with squeezed that because are plan. through is great beneficial who we're retention employers. then we're for us departments the and and that of so I dealing a

early the in see develop. year So that pipeline we’re to

little bias. it’s be soon tea I’m too So that certainty. to say a for the that -- reading leaves, say But me to with that would if my that’s

Operator

Thank you, Sandy.

Sean, Markets. your question goes Our RBC is is line next open. Sean with Capital Dodge

ahead. You can go

Sean Dodge

Thanks, good afternoon.

you've longevity to back BetterHelp. some with talking all or experimenting there to retention know models Going platform. help about been different I designed the improve Jason, on

and about you you've on to before ramp can these, think up as of scale? how without to of these you models effective can they kind I there And where you them based do launch provide are in? be to any maybe want people churn down Are And talked you having off. flexible updates to those? use, how use Thanks. some you test around more finding when larger expect much

Jason Gorevic

a the We in Sean. in acquisition metrics business, of unfortunately, six the and the Thanks, BetterHelp weeks the see improvement BetterHelp consistent customer exception do Yeah. cost. with last

would say, think that stable And around has improving modestly. on product the one-to-many And And things with help of space. stable. the literally LTV brand up Brand we business group Specifically, therapists continued structures. strong, like of the every things years. had. relationship is continue a we to new dozens Retention I and which pages last leading between forward rates it's have to visits over that's that our and tactics, really been enable of that leads growth test we the tremendous pricing one therapy, and features, registration awareness couple to to consumers. is quarter, do drive in innovate has Conversion I have been the

percentage-wise. We continue high of significant in also that XXs business growth out do projecting growth business. in still the We're to expect that

continue of consumer in getting the So this change optimize to I the refine in to doesn't that. overcome a we're efforts yield it. to take circumstance, it the advertising. to product good disciplined like for do our Unfortunately, out continue And we environment and approach feel

overspend So we way of through competition. our the are follow to irrational and that lead going not

Mala Murthy

that we operate in, And add, the continues BetterHelp at in, to diversity grow. acquisition we would channels expand continue the which the the Yeah. also scale business that scale operates of I we to the have. on

So still that channels Jason the of operating about, all have, the those the we metrics very diversity intact. talked much of are

the said that's in remarks, we our a is in prepared high-XXs. business growing this As

of guidance is the relative growth very making that are come few again, the So trends over that robust had. the to to are we last since weeks There that February we expectations you with growth. certainly seeing us earlier revised

Operator

Sean. you, Thank

is Our your Cannacord to next Genuity. question goes Richard, open. line Close Richard with

You ahead. can go

Richard Close

a the Maybe side. on there the being to impact preferred you those mentioned whole-person Ryan's the with lowered point integration Yeah, something And on full respect becoming close people it solutions. you or solutions deals? not thanks on are more respect that's chronic, Is little the where health the chronic with any since you to vendor with chronic dive Express on chronic don't of the also the all side? leading the to into able at not bit questions. have for definitely question -- guidance Scripts the to that Was

Jason Gorevic

Yes.

say current the there. So to would of to question. respect and year. significant is amount I respect really guidance launch source within a the to contribution our challenge as With Express, typically revenue deals Richard, the for that the we at With modest all. a in-year expect thanks bit outlook, see no incorporates Omada and is impact the little from our we don't revenue, the sign of that question, of a to case, in-year that from

assumed than from Our deals revenue, percentage adequately and that felt we're a pipeline signed low-single just within the launched anticipated. the contribution relatively modest But risk move We prior revenue. that meaning downside slowly that, from digit the captured same guidance more in-year contribution to range overall we seeing point year. that guidance a

the our from that majority of removed we've significant outlook. So

I'm sure that we outlook the if revenue. any quarter for our our change modification honestly think BetterHelp. have the we not with I even reduction reduction in outlook said, in the I sort of if to in of made consequent or As or grand commensurate weren't -- represents it would would our for scheme, it if about have about overall as outlook

Mala Murthy

we see, also still perspective. I expense within gave. profit from have were only has I If control -- as -- cost it it a Yeah. we perspective, punches you would and -- add the mean we profit a would more within that, weight levers have original guidance from slightly that levers, carries a it managed

Jason Gorevic

finished into we're another Richard, being because to are seeing the But with like -- the the to of it's strong integration, that behind the we in research, market with care our points a where seeing lot approach. the incredibly I whole-person very, it. we integration whole-person We're response very strong terms in we verge of strategy, the study. of middle and maturity respect proof said, chronic have on of sort still And or we then, do of are the solutions of don't

confident to to waiting terms the in of those who are to health the see clients. to large with bulk in And anxious to but I like buying, we and have. large order very, are I’m of that we’re impact. we’re their very impact people So are and said, that early the starting it see self-insured adopters yet will offer waiting see, buying in the And haven’t market plans hit it

Operator

Richard. you, Thank

to Davis goes open. SVB is Our your Securities. next question Stephanie, with line Stephanie

ahead. can You go

Stephanie Davis

funding? you my Thank ever the but been Is extra question. to Hey, wing accelerating towards it love in bunch, you be strategic pull like on asked thoughts anything you've DTC BXB And Jason, could kind shift or were that missed more mix be this entirely is the business? accelerate going a both leverage that? for less the mind, quarters cost know to going the DTC-driven. of arc your because to you've I guys. what the side two the and on with this taking solution Or strategy-related I'd of calls DXC DTC private

Jason Gorevic

also is term, we BXB love the We that R&D gross integrating as long terms as services -- to long-term the the of accelerate of be margins seen business know BetterHelp dollars it work and put business? the growth majority whole-person is the that well the in approach going to our business into BXB our the Levers sheet think the business. I of Yeah. side as generates. on No, to us, the tend products the a M&A investment business. we sticky of our on BXB you've think And look, and over focused that from I and our where balance significant higher, and is

the and we're unmatched of of this yield BXB on of sort expect lot and doing the in get feedback there, We're come we're So our again, to of other of on in integration. the And that out that the with investment I to the And integration based just from markets. benefits to we year expect there's fruits a see and we have in platform that -- clients prospects. market. confidence of no side the question whole-person on work the approach big that get journey based and set our it data an the is opportunity I the products to a a significant

Mala Murthy

would do and as the leverage is that expense we dynamics growth. T&D PrimaryXXX, I are to are What as of size have add, done, from we will in to in long-term operating Stephanie, it on of right, are resonance sustainable conditions revenue terms out said Yeah. we a that's the still continue is, discipline think And as investing the as important always continue we’ve that perspective, we it. those the in to we drive the market, whether go plan; we always be And execute terms on from unchanged. to that we all addressable different in opportunity, we drive different the stay I about of in unchanged, seeing of spending, controls where the have And talked on done. we’ve strong clients, sell and that actually perspective, it, focus And business it’s it. we of going to we an important continue always doing R&D focused areas any are that it’s

Operator

Stephanie. you, Thank

question is next line Citi. Daniel, goes Grosslight to open. with Daniel your Our

can ahead. go You

Daniel Grosslight

Hi, Thanks for taking question. guys. the

of Given it year, how for in around of increase seems thinking expansion It about half persist cadence that remainder EBITDA you? second midpoint XX% implies year. will of you're the XQ will care the that guidance. chronic latter the pressures I half around X.X% quarterly second from curious that half. in the to the just of I'm Can margins BetterHelp margin for looked and at the the the

Mala Murthy

great a drivers revenue of taken margin about of It's ramp year, we do year, Yeah. the thinking Daniel. the down that while expansion. revenue margins again, guidance of have are through to expect right? for we progression the still question, one The So is, our the is the overall we way the

and the gift increase year is, in as that is we we of LTV BetterHelp The members the up early And in DTC side through about that members. part is the second we the the the is ad those talked in we year on retain those the the thing of of business as us, keeps normal and a for we year. benefit giving the members as earnings have members, on first did in are keep of and we that get -- as the those sort spend call of heavying last we on QX

it that as say of through the go end an the also as sort the that in contribute on last then to we entirely the of something that are the adjusted as care the is bringing we that think we And financially of are go So that through think increasing towards we the would we that as year -- And the done enrollees the every margins beginning of we've go fact the year. is side to thing through impact consistent what year. year on go we is the is margins from something is, as as EBITDA the I about fact and year, we enrollment ramp the year. chronic expansion going expanding

what albeit it the margin drivers and out in I our have reduction way are year, the very So the the we is, guidance. now thinking much thought in we February with earlier -- same the about revenue to would say you when the way those guidance about we and drivers, as the go we through progression of came

Operator

Daniel. you, Thank

next open. is Charles line your Cowen. Our Charles, Rhyee question is with

You can go ahead.

Charles Rhyee

for the question. to follow that, Maybe taking thanks on Yeah, Mala. up

the Day when like of were? and care still you within gave to help this from from is were you components here up guys of kind those? past take expansion to revised points you're the really higher you of about thesis maybe still Perhaps, terms the of margin sounds DTC basis what kind out us long-term we or beforehand costs, that better we Can us the the Thanks. expecting largely then remind XXX the in of intact. XXX expansion sort long-term, sort what starting think of other there. the versus sort want in saying of it as a range you Analyst You sort I what sounds than levers the is what chronic that is here, don't Maybe the you're So ballpark? point is help still were margin talk projecting talked for saying components, margin and know components lower but it XXXX, because you about of maybe like is outlook

Mala Murthy

Yeah. Charles, thanks.

talked for that to emerged beyond given the in just are environment we rapidly right? have guidance weeks. We position the gave, about evolving care, We've a provide the that virtual outlook the just an over last several not dynamics

consistent all with strategy few at said more confident with than to have what you the and of how just are positioning go Q&A, to growth things an we in we a this details ago. in say similar reevaluating market, our addressed all a outlook. in are I dynamics in give process evolved. much update the minutes so don’t evaluation. And from the want that moment longer-term into said, these Jason after of in various perspective we our our we've we that long-term I that will given affect just we what gave have remarks And and will What our how is, discussed they how completed

Operator

you, Charles. Thank

line question Tassan open. with your is Sandler. to Jessica Piper Jessica, next Our is

You can go ahead.

Jessica Tassan

Hi, the for taking thanks so much question.

think XX% can Thanks. how much you how is So of XX% membership-driven? we that anticipated And behavioral, growth is just the about growth to us pricing-driven? much as help understand in

Mala Murthy

into details. typically go not the do We

level disclosed how We BetterHelp. not membership-driven That’s is about have versus of much pricing-driven. go not talking a detail of into in we details You’re of the the that will past. it typically

Operator

Jessica. Thank you,

question Allen goes your Lutz open. Bank America. to of next Allen, line Our with is

ahead. You can go

Allen Lutz

Thanks. Or think about XQ level to then trending the the BetterHelp kind back is creep about you in that how up? go based the there as over to think about going year, the on that guide? And something advertising that of that's quarter? of the we kind the again, to and think peak should embedded to of as guess is spent you second percent in what's continue course you revenue, advertising first a quarter I in of a

Mala Murthy

higher But phasing It The -- we early are of typically, would talked I is. say as in detailed is we and non-normal in business back we what the XX% heavy average the the was through about a Allen, XQ increase go have go So in if is we've to year. holiday I BetterHelp about, we year. would what -- on embedded a you in again, as part season, XXXX things full about. year, tend year. advertising we because, what an the typical into a and that we into pull I sort highly past -- of run ROI-driven advertising our of we year a year. think typical much the for evolving. don't see more are go of as up we of a the But we in way. to the market only what is are as And you is said costs forecast, cost our have is we say, in do year, remind the acquisition in thing we various would talked we There dynamics want

we dynamics of type So go the you playing should expect to similar through as year. see out

Operator

Thank you, Allen.

Deutsche line Our Bank. goes Hill George, with open. next is your to question George

You can ahead. go

George Hill

for market the that and of taking an suite entire And market who the about, you bring talked can somebody about guys. for pause I evening, back the Good looking to seemingly employer question. solutions. dynamics to to a taking come Jason, guess, Yeah. I bear kind thanks want

the seeing compete to could trying -- to of understand, to XXXX? think competitors, it whether new third-party feel trying it's I you do called solutions hiccup against basis? dynamic of and solution. the I'm a season this into of the you you for one-off are guess seeing a you own everyone And together is are So impact my are referenced market is I way? you And somebody parts. compete sales solutions trying season, selling dynamic. that question guys? earlier, guys different like One suite was business group two whole-person in is competitive to that on I the that a their enough telemedicine So breadth, kind Or else of Thank it's your the MCOs, different competitively, guess you you. in competitive like is cobble a shifting with

Jason Gorevic

on to health clients, now a plans care course for impact think be our our business. we've move of season and of that. large is summer late I pipeline XXXX to services very develop Yeah. a multiple that stages soon strong contracting through very George, the the early can too the the you which be for their are is the embracing The and lot to services, self-insured into big will available fourth What them selling will then pipeline tell mature of for tell really with managed opportunities begin we're over that to I the it's what quarter. seen

that more XXXX is I think we're I to encouraging modest getting then 'XX significant. very become going me and to PrimaryXXX, have the would other was part say but contributor I said, Mala ramp the very PrimaryXXX. that and are traction to would in care reception to seeing always be and solutions. much is about that 'XX very a to that sales going very with to it's both November that’s good Mala our we in who embracing on-ramp large chronic strongly our we solution. as that with be expected. progressing believe faster for had that than an opportunities, We're talked I And --

a we therefore, multiproduct suite. about when we products, talk to where get that’s multiple being So XX% and sales, our to full on-ramps sales phenomenon the of multiple self-reinforcing

Operator

Thank you, George.

your goes Berenshteyn Fargo. with question Stan next Wells line is to open. Stan, Our

ahead. You can go

Stan Berenshteyn

the for making. mental the you're I taking to on health guess questions. understand just the direct-to-consumer Thanks side, comments Jason,

to being substances getting your not that when And understand aren't patients be prescribing web So controlled that business, seeking a search. adversely impacted medicines. because you're these they're you is business potentially seem I initiating your

end is, other signing up would for competitors BetterHelp question instead for suitable my that these guess who discussing? someone you're I up So is why

Jason Gorevic

and Because online they controlled provide substances. therapy both

will access reinstated it a likely broader provides to may net. a believe may substances in issue, decisions Again, options. an And of -- that's that And for a is be controlled I who prohibition where issue temporary believe just bigger the increase it's make prescribing on regulations. is take to we be that or So because population the making again, and multiple in is that search be companion actual the us think advertising paid the a issue it would the change I price reinstated in between social.

Operator

Thanks, Stan.

Anderson to Elizabeth open. goes Evercore. Our with next your line Elizabeth, is question

go is line ahead. Elizabeth can open. You your

ahead. we're not on audio to any from will getting can question. Elizabeth, the we You next Since move go

Our Motz open. is Cindy Goldman next is question Sachs. Cindy, with from your line

ahead. can You go

Cindy Motz

And then back a fears when like little. pulling BetterHelp, things it I question. your maybe Hi, think thanks to I care a it, point. this for was question, way in my different looking to, at get some Sandy's wanted chronic for to and with inflation some cheaper can they of a clients this back maybe not just of taking if wage watching just get you maybe maybe even the about is segment, people whatever overriding for think are from recessionary price

and I weeks So everything then guess, down supposedly just whether here it I sounded BetterHelp. very is those macro ago, customer we situations with acquisition strong because, six are. were coming the know costs

all any But the like in something at Thanks. just to -- each view segment to us temporary. so also us said, help way Mala, think sort and BetterHelp, would in chronic. are margins -- have just margins is other? of -- were this about you And whether the with attractive that relation long-term still margins You the help could macro-driven so a I about they assume to that

Jason Gorevic

are tell pipeline opportunities it and Cindy, definitely getting there and slowdown close. so effects. We we're evidence possible and it, to the you is going of that of here is to source moving the Yeah. our through certainly that that, of macro in don't have a not cadence sit

clear a is it's do and costs moved have don't have beginning the that of March, consumer or we recession evidence of sustained as again, changed ad driver. the been since that sensitivity inflation and side, really the And between March. or on We pricing increased significantly. increasing then January to February into On basis that way BetterHelp evidence we

hypothesis. figure disagree. clear that -- and point frankly, things we we the trying that of And state evidence quite hypothesis, we're can have among I confidence. to with we wouldn't is So only That a out to others. on how the And working test

Mala Murthy

basis, couple think your Cindy, were year-on-year benefits, of on margin a and And for were gross purchase year-over-year. to essentially flat XQ just margin how our if comments. about on you question, normalize and the that If trended price I gross a accounting margins

I reasons would margin I beyond say, I think progression, our I I mentioned. not so And said, XXXX go if will about for all the as

the will us as And reevaluating to that I that have our We'll And from et that profit and drive margin say will into will scaling a get adjusted go always our long-term long-term controls. I sustainable make I've look the dollars value-based we expansion. we to But increasingly also EBITDA standpoint. profit revenue across said thing said are right will our We we the to will expense maintain dollars. ultimately revenue we gross care that increase board. -- investments before, look as growth cetera, arrangements, is

business one. report All we out do the parts break still for is of margins of as our We different holds. since not thinking that --

Operator

Thank conference XXXX you, Cindy. today's you participation. Teladoc concludes your call. QX earnings Thank This for

disconnect now lines. You can your

Teladoc Health (TDOC) 28 Apr 222022 Q1 Earnings call transcript