Direct-to-consumer telemedicine provider Teladoc saw double-digit growth during the first quarter of the year as a result of COVID-19. Specifically, total revenue grew 41% to $180.8 million compared to the same period last year. Total revenue includes subscription access fees (75.8%) as well as visit fee revenue (24.2%). More than three-fourths of the subscription access fees come from clients in the United States with the remainder from international clients. In addition to sizable revenue growth, the number of Teladoc visits grew a record 92%.
“In the first quarter of 2020 alone, Teladoc Health delivered two million medical visits to people around the world, while simultaneously expanding access to millions of new members,” said Jason Gorevic, CEO, in an April 29 news release. “As our clients and consumers have turned to us during these unprecedented times, our proven ability to meet their needs has elevated our global leadership role and accelerated our impact on the healthcare system overall.”
Other highlights from the quarter include the following:
- As of March 31, 2020, Teladoc had 43.0 million members, compared to 26.7 million members on March 31, 2019.
- As of March 31, 2020, Total U.S. Visit Fee Only Access was 19.2 million, compared to 10.2 million on March 31, 2019.
- Gross margin for the first quarter of 2020 was 60.0% compared to 65.3% in the first quarter of 2019.
- Despite the increase in revenue and visits, Teladoc reported a first quarter net loss of $29.6 million, or $(0.40) per basic and diluted share, down from a net loss of $30.2 million, or $(0.43) per basic and diluted share, in the first quarter of 2019.
Teladoc shared its outlook for the second quarter of 2020:
- Total revenue is estimated to be in the range of $215 million to $225 million.
- EBITDA is estimated to be in the range of $(1) million to $3 million with adjusted EBITDA in the range of $20 million to $24 million.
- Total U.S. paid membership is anticipated to be approximately 49 million to 50 million members and visit fee-only access to be available to approximately 21 million to 22 million individuals, including the addition of 2 to 3 million members on a temporary basis.
- Total visits will be between 2.3 million and 2.4 million.
- Net loss per share is anticipated to be between $(0.28) and $(0.23).
Teladoc’s guidance for the full year 2020 is as follows:
- Total revenue is estimated to be in the range of $800 million to $825 million.
- EBITDA loss is estimated to be in the range of $(14) million to $(4) million with adjusted EBITDA to be in the range of positive $70 million to $80 million.
- Total U.S. paid membership will be at least 50 million members and visit-fee-only access will be available to approximately 19 million to 20 million individuals.
- Total visits are estimated to be between 8 million to 9 million.
- Net loss per share is based to be between $(1.27) and $(1.13).
With 2,400 employees around the world, Teladoc offers telemedicine services to clients in 175 countries in 40 languages. Care includes everyday care, pediatrician services, mental health support, wellness and preventative care, and access to medical experts. Teledoc partners with employers, insurers and health plans which dictate the co-pay patients will pay. Co-pays are based on the type of service requested and an employee’s insurance plan.
As COVID-19 has spread, Teladoc has added a coronavirus page to its website with advice, tips and information about how people can prevent the spread of COVID-19. They also explain when they can help versus when a patient should go to their own doctor for an in-person visit.
It is interesting to see that Teladoc has seen such growth in terms of total revenue and visits, yet its net loss was only slightly lower than it was for the first quarter of 2019. The company is, however, anticipating additional revenue growth and lower net losses for the second quarter. We hope their business model and financial situation are strong enough to withstand at least one more quarter of COVID-19.