- Teladoc ran 2.8 million total virtual visits in the second quarter of the year, more than triple the same period last year as the pandemic continued to spur telehealth utilization, the vendor reported in financial results released Wednesday afternoon.
- The Purchase, New York-based vendor reported revenue of $241 million, up 85% year over year, beating Wall Street expectations, though Teladoc did miss slightly on earnings. Its paid U.S. membership almost doubled year over year, reaching 51.5 million from just 26.8 million in the same period last year.
- Teladoc significantly raised its 2020 guidance as a result, after hiking it in the first quarter as well. The 18-year-old company expects full-year revenue between $980 million and $995 million, and total visits between 9.8 million and 10.3 million. That's compared to just $533 million in revenue and 4.1 million total visits last year. Teladoc also said it expects to achieve 30% to 40% year-over-year revenue growth in 2021.
Digital health is one of the few industries thriving amid the coronavirus, with major telehealth vendors like Teladoc, Amwell and Doctor on Demand reporting unprecedented growth. The pandemic accelerated the adoption of virtual care starting in March, as patients began to avoid doctor's offices and hospitals, afraid of potential virus transmission, and providers temporarily shut down non-emergent services.
However, vendors are reporting utilization is yoked to the availability of in-person services. As states reopened in April and May, many vendors saw volumes dip though usage remains high overall, especially for behavioral health services, in a traditionally slow quarter.
Teladoc's utilization has stabilized at 40% higher than pre-COVID levels following May and June containment measures, CEO Jason Gorevic told investors on a Wednesday call. And that could swing higher once again as COVID-19 cases increase across the South and West, which could bode well for telemedical utilization in the back half of the year especially if the coronavirus coincides with the flu season.
However, Teladoc didn't factor in a second wave into its third-quarter and full-year outlook, reflecting a "healthy level of conservativism," SVB Leerink anaylst Stephanie Davis wrote in a note on the earnings.
"The persistent strength in visit volumes retains our confidence in meaningfully higher visit volumes going forward," Gorevic said. Teladoc's bookings reflect that confidence, up a little over 70% year over year, with an average deal size up 50% year over year.
Teladoc saw a tenfold increase in utilization on its provider book of business, as more of its health system and medical group clients shifted their encounters to virtual.
Earlier this month, Teladoc closed its $600 million acquisition of provider telehealth vendor InTouch Health to expand its health system offerings, and expects its hospital-based telemedicine business to grow more than 35% this year as a result.
However, Teladoc's topline continues to lean most heavily on U.S. subscriptions paid by insurers and employers. Revenue from such subscriptions was $152 million in the quarter, up 78% year over year. Revenue from per-visit fees, paid either by insurers or directly by patients, was up almost 450% to $19.5 million, while U.S. paid visits made up $39 million in revenue, up 159% year over year.
Teladoc, which went public in 2015, hasn't yet turned a profit. It reported a loss of $25.7 million in the quarter — slightly better than the $29.3 million loss same time last year — despite rising expenses, which rose 63% in the quarter due to investments in technology, onboarding more physicians and spending more on advertising.
Teladoc also began piloting a virtual primary care model in the second quarter it expects to go live in the first half of 2021. Pricing could be on a traditional per-member-per-month basis, risk-based or some other arrangement, execs said.
For the third quarter, Teladoc expects revenue of $275 million to $285 million and total visits between 2.5 million and 2.7 million. That's compared to $138 million in revenue and fewer than 1 million visits in the third quarter of 2019.