Health Teladoc posted a net loss of $3 billion during the second quarter, bringing its losses for the year so far to nearly $10 billion.
By comparison, the virtual care giant posted a $133.8 million loss in the second quarter of 2021. Teladoc also reported another $3 billion non-cash goodwill impairment charge in the second quarter, then of a $6.6 billion charge related to its acquisition of Livongo reported last quarter.
But Teladoc revenue increased 18% to $592.4 million, compared to $503.1 million in the second quarter of 2021, the high end of expectations.
During an earnings call, CEO Jason Gorevic said the virtual care giant’s performance was driven by growth in its chronic care segment. Teladoc had previously projected that chronic care enrollment growth would be weighted at the end of the year. But he also noted that deals for the segment are moving slowly so far this year.
“We think at least in part it’s due to competitive noise as the market moves from stand-alone point solutions to integrated virtual care for the whole person,” he said during the call. “Based on what we’re currently seeing in the market, we also believe that heightened economic uncertainty in recent months is playing an increasingly important role in delaying the decision-making process in the employer market.”
He also promoted Teladoc’s BetterHelp direct-to-consumer mental health product, which saw revenue growth of more than 40% year over year. Still, similar to the company’s first-quarter report, BetterHelp was hampered by poor returns on its marketing spend as competitors flooded the mental health market.
“We still see smaller private competitors pursuing what we believe to be low or no return customer acquisition strategies to establish market share. While we don’t see this as sustainable, it’s hard to predict how long this dynamic may continue,” he said. Gorevic.
“We also believe that the weakening economic environment and declining consumer confidence are likely to have an effect on BetterHelp’s performance. In recent months, we have seen a modest incremental decline in return on ad spend, which we believe which may be a belt indication. hardening among consumers”.
Teladoc expects revenue of between $600 million and $620 million in the third quarter, with a net loss per share of between $0.85 and $0.60. For the full year, the virtual care giant forecast revenue of between $2.4 billion and $2.5 billion, though it cautioned that results could be on the lower end of the range due to market conditions.
THE BIGGEST TREND
Teladoc Stock dove on the earnings news, closing Wednesday at $43.24 a share and opening Thursday morning at $35.28.
After disappointing earnings in the first quarter of this year, a class action lawsuit alleged that Teladoc had misled investors about its business and financial prospects. A Teladoc spokesman said “there was no factual basis for the lawsuit.”
The virtual care company launched its Chronic Care Complete management program earlier this year. It also recently added same-day drug delivery and home lab collection to its primary care offering, Primary360, through partnerships with digital pharmacy Capsule and Scarlet Health.