- Teladoc Health saw its year-over-year total revenue more than double in the second quarter of this year, coming in above Wall Street expectations and hiking its full-year guidance for the second time this year after offering mild expectations in February.
- Analysts noted, however, that membership numbers were stale and the hospital business was slower than expected for the quarter. Shares were down 6% in morning trading Wednesday.
- In a call with investors Tuesday, executives tried to steer the conversation toward per-member revenue metrics and touted new contracts, including with major Blues payer HCSC and a primary care platform agreement in the works with an unnamed national payer.
SVB Leerink analysts noted investors continue to be spooked by a concern of little cross-sales traction with Livongo, which Teladoc bought last year for $18.5 billion, and the possibility that virtual visits will drop off as more people get coronavirus vaccinations. They noted, however, that "core business metrics quietly continue to outperform."
COVID-19 led to a major spike in telehealth use that's beginning to level off but still settling in at much higher rates than before the pandemic. One recent study pegged the usage at 38 times pre-COVID-19 levels. And, with the rising threat of the highly contagious delta variant of the coronavirus, visits could tick up, especially as some hospitals have again been forced to put off elective procedures amid rising case counts.
Teladoc executives on Tuesday touted their project pipeline and reinvestment efforts aimed at achieving an evolution from episodic urgent care services to a more comprehensive suite that includes programs for mental health, chronic care, weight management and primary care.
Management said the primary care program, Primary360, was in "very very late-stage" discussions with multiple payers. They also pointed to the launch earlier this month of myStrength Complete, the first program that is cross-platform across Teladoc and Livongo.
Addressing the hospital market, Gorevic said the company has hopes for growth in the area from its recently announced partnership with Microsoft Teams, which aims to streamline clinical processes and allow for better data analytics.
"What we're hearing from hospital administrators is ... they want to turn virtual care into a revenue generator, a way to better manage their at risk populations, and to manage over positive care because more and more, they're on the hook for delivering value," Gorevic said.
The company posted a net loss of $133.8 million for the period, compared to a loss of $25.7 million in the prior year quarter.
Teladoc is one of the most established names in telehealth but it faces increasing competition — from newer companies that have ramped up investor interest and gone public, to major names like Walmart and Amazon.
One key issue for companies like Teladoc will be how telehealth services are covered by payers after the COVID-19 public health emergency ends. Lawmakers have expressed support for ongoing Medicare coverage, which would likely prompt private payers to continue coverage as well. This week, more than 400 healthcare organizations sent a letter to congressional leaders asking them to keep many of the flexibilities for providing telehealth services put in place during the pandemic.