Teladoc Health, Inc. (NYSE: TDOC), the global leader in
whole-person virtual care, today reported financial results for the
quarter ended September 30, 2021.
“Our strong performance in the third quarter reflects our
continued success in leading the transformation of healthcare
delivery and expanding access for all,” said Jason Gorevic, chief
executive officer at Teladoc Health. “By leveraging our unique
combination of data, analytics, technology and dedicated healthcare
professionals, we are driving growth across our business. The third
quarter was notable in expanding relationships with a number of
leading national health plans with the successful launch of our
Primary360 offering which reimagines the primary care model and
delivers increased access and engagement to members.”
“As we look ahead to the rest of 2021 and into 2022, we are
confident in our ability to innovate, anticipate and solve for the
evolving whole-person health needs of consumers and healthcare
professionals globally," Gorevic added.
Financial Results for the Third Quarter and Nine Months
Ended September 30, 2021
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Revenue |
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($ thousands, unaudited) |
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Quarter Ended |
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Year over Year |
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Nine Months Ended |
Year over Year |
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September 30, |
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Growth |
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September 30, |
Growth |
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2021 |
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2020 |
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2021 |
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2020 |
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Access Fees
Revenue |
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U.S. |
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$ |
413,594 |
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$ |
194,622 |
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113 |
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% |
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$ |
1,161,084 |
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$ |
454,582 |
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155 |
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% |
International |
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37,989 |
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31,997 |
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19 |
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% |
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112,699 |
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|
91,261 |
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23 |
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% |
Total |
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451,583 |
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226,619 |
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99 |
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% |
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1,273,783 |
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|
545,843 |
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133 |
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% |
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Visit Fee
Revenue |
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U.S. |
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|
59,863 |
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|
|
50,948 |
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18 |
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% |
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|
173,399 |
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|
|
152,944 |
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13 |
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% |
International |
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|
116 |
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|
96 |
|
|
22 |
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% |
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|
368 |
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|
705 |
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(48 |
) |
% |
Total |
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59,979 |
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|
51,044 |
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18 |
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% |
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|
173,767 |
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|
153,649 |
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13 |
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% |
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Other |
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U.S. |
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9,583 |
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10,299 |
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(7 |
) |
% |
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29,617 |
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|
10,299 |
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188 |
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% |
International |
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513 |
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850 |
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(40 |
) |
% |
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1,305 |
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|
850 |
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54 |
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% |
Total |
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10,096 |
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|
11,149 |
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(9 |
) |
% |
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30,922 |
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|
11,149 |
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|
177 |
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% |
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Total Revenue |
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$ |
521,658 |
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$ |
288,812 |
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81 |
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% |
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$ |
1,478,472 |
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$ |
710,641 |
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|
108 |
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% |
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n/m – Not meaningful
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Membership and Visit
Fee Only Access |
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(millions) |
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Quarter Ended |
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September 30, |
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Growth |
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2021 |
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2020 |
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U.S. Paid Membership |
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52.5 |
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51.5 |
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2 |
% |
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U.S. Visit Fee Only
Access |
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23.6 |
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21.8 |
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8 |
% |
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Chronic Care Enrollment |
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0.725 |
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- |
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n |
/m |
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Visits |
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(thousands) |
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Quarter Ended |
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Year over Year |
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Nine Months Ended |
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Year over Year |
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September 30, |
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Growth |
|
September 30, |
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Growth |
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2021 |
|
2020 |
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2021 |
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2020 |
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U.S. Visits |
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3,354 |
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|
2,390 |
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40 |
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% |
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|
9,114 |
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|
6,306 |
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45 |
% |
International Visits |
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531 |
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|
445 |
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19 |
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% |
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|
1,475 |
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|
1,330 |
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11 |
% |
Total Visits |
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3,885 |
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|
2,835 |
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37 |
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% |
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10,589 |
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7,636 |
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39 |
% |
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Utilization |
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23.7 |
% |
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16.5 |
% |
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713 |
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pt |
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21.6 |
% |
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15.4 |
% |
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620 |
pt |
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Platform-Enabled
Sessions* |
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969 |
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986 |
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(2 |
) |
% |
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3,078 |
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|
986 |
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|
212 |
% |
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Total Visits & Sessions
Provided & Enabled |
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4,854 |
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3,821 |
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27 |
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% |
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13,667 |
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8,622 |
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|
59 |
% |
* Platform-Enabled Sessions are a unique instance in which our
licensed software platform has facilitated a virtual voice or video
encounter between a care provider and our client’s patient, or
between care providers. We believe platform-enabled sessions are an
indicator of the value our clients derive from the platform they
license from us in order to facilitate virtual care.
- Net loss was $(84.3) million for the third
quarter of 2021 compared to $(35.9) million for the third quarter
of 2020. Net loss was $(417.8) million for the first nine months of
2021 compared to $(91.2) million for the first nine months of 2020.
The third quarter and first nine months of 2021 include stock-based
compensation expense of $71.7 million and $241.0 million,
respectively, representing increases of $50.8 million and $179.8
million, respectively, from the third quarter and first nine months
of 2020, substantially reflecting higher expense associated with
Livongo stock awards that continue to vest after the merger. Net
loss also includes amortization of acquired intangibles of $45.1
million and $133.8 million, respectively, for the third quarter and
first nine months of 2021, representing increases of $35.0 million
and $109.2 million, respectively, from the third quarter and first
nine months of 2020, substantially reflecting higher amortization
of acquired intangible assets from the Livongo and InTouch Health
acquisitions. Net loss also includes loss on extinguishment of debt
of $0.8 million and $43.7 million, respectively, for the third
quarter and first nine months of 2021, a decrease of $0.4 million
and an increase of $34.7 million, respectively, from the third
quarter and first nine months of 2020, primarily reflecting the
exchange of convertible senior notes in the first nine months of
2021. Net loss also includes non-cash income tax expense of $3.6
million and $93.9 million, respectively, for the third quarter and
first nine months of 2021, substantially reflecting the recording
of a valuation allowance on stock compensation benefits associated
with the Livongo merger recorded in the first quarter of 2021.
- Net loss per basic and diluted share was
$(0.53) for the third quarter of 2021 compared to $(0.43) for the
third quarter of 2020. Net loss per basic and diluted share was
$(2.68) and $(1.17) for the first nine months of 2021 and 2020,
respectively. Net loss per basic and diluted share includes
stock-based compensation expense of $0.45 per share and $0.25 per
share for the third quarter of 2021 and 2020, respectively, and
$1.55 per share and $0.79 per share for the first nine months of
2021 and 2020, respectively. Net loss per basic and diluted share
also includes amortization of acquired intangible assets of $0.28
per share and $0.12 per share for the third quarter of 2021 and
2020, respectively, and $0.86 per share and $0.32 per share for the
first nine months of 2021 and 2020, respectively. Net loss per
basic and diluted share also includes loss on extinguishment of
debt of $0.01 per share for the third quarter of both 2021 and
2020, and $0.28 per share and $0.12 per share for the first nine
months of 2021 and 2020, respectively. In addition, net loss per
basic and diluted share includes the non-cash income tax charge
(benefit) referred to above of $0.02 per share and $(0.03) per
share for the third quarter of 2021 and 2020, respectively, and
$0.60 per share for the first nine months of 2021 as compared to a
benefit of $(0.07) per share in the first nine months of 2020. The
number of weighted-average shares outstanding was 159.4 million and
155.9 million for the third quarter and first nine months of 2021,
respectively, up from 83.6 million and 77.8 million for the third
quarter and first nine months of 2020, substantially reflecting the
impact of the Livongo and InTouch Health acquisitions.
- GAAP Gross margin, which includes depreciation
and amortization, was 67.1 percent for the third quarter of 2021
and 63.3 percent for the third quarter of 2020. For the first nine
months of 2021 and 2020, GAAP Gross margin was 67.3 percent and
61.7 percent, respectively.
- Adjusted Gross margin was 67.6 percent for the
third quarter of 2021 compared to 63.7 percent for the third
quarter of 2020. For the first nine months of 2021 and 2020,
Adjusted Gross margin was 67.9 percent and 62.3 percent,
respectively.
- EBITDA was a loss of $(8.7) million for the
third quarter of 2021 compared to a loss $(6.8) million for the
third quarter of 2020. EBITDA was a loss of $(72.3) million and
$(15.4) million, respectively, for the first nine months of 2021
and 2020. EBITDA includes stock-based compensation expense of $71.7
million and $241.0 million for the third quarter and first nine
months of 2021, respectively, representing increases of $50.8
million and $179.8 million from the third quarter and first nine
months of 2020, respectively, substantially reflecting higher
expense associated with Livongo stock awards that continue to vest
after the merger. EBITDA also includes acquisition, integration and
transformation costs of $4.3 million and $22.1 million for the
third quarter and first nine months of 2021, respectively,
representing decreases of $21.1 million and $8.6 million from the
third quarter and first nine months of 2020, respectively.
- Adjusted EBITDA was $67.4 million for the
third quarter of 2021 compared to $39.5 million for the third
quarter of 2020. Adjusted EBITDA was $190.8 million for the first
nine months of 2021 compared to $76.5 million for the first nine
months of 2020.
A reconciliation of generally accepted accounting principles
(“GAAP”) in the United States to non-GAAP results has been provided
in this press release in the accompanying tables. An explanation of
these measures is also included below under the heading “Non-GAAP
Financial Measures.”
Financial OutlookTeladoc Health provides
guidance based on current market conditions and expectations. Given
the uncertainty of the expected path of the COVID-19 pandemic as
well as the broader economic impact, our updated guidance is based
on what we know today. As this is an evolving situation,
circumstances are likely to change, but we believe our guidance
ranges provide a reasonable baseline for 2021 financial
performance.
For the fourth-quarter 2021, we expect:
- Total revenue to be in the range of $536 million to $546
million.
- EBITDA to be in the range of $(8) million to $(3) million.
- Adjusted EBITDA to be in the range of $69 million to $74
million.
- Net loss per share, based on 160 million weighted average
shares outstanding, to be between $(0.73) and $(0.53).
- Total U.S. paid membership to be in the range of 52.5 million
to 53.5 million members and visit fee only access to be available
to approximately 23 million to 24 million individuals.
- Total visits to be between 3.9 million and 4.1 million.
For the full-year 2021, we expect:
- Total revenue to be in the range of $2,015 million to $2,025
million.
- EBITDA to be in the range of $(80) million to $(75)
million.
- Adjusted EBITDA to be in the range of $260 million to $265
million, including an estimated $20 million in lower expenses
primarily related to Livongo devices as a result of the
merger.
- Net loss per share, based on 157 million weighted average
shares outstanding, to be between $(3.40) and $(3.20).
- Total U.S. paid membership to be in the range of 52.5 million
to 53.5 million members and visit fee only access to be available
to approximately 23 million to 24 million individuals.
- Total visits to be between 14.5 million and 14.7 million.
Quarterly Conference Call
The third quarter 2021 earnings conference call and webcast will
be held Wednesday, October 27, 2021 at 4:30 p.m. E.T. The
conference call can be accessed by dialing 1-833-968-2101 for U.S.
participants, or 1-236-714-2089 for international participants, and
referencing Conference ID Number: 3489052; or via a live audio
webcast available online at
http://ir.teladoc.com/news-and-events/events-and-presentations/. A
webcast replay will be available for on-demand listening shortly
after the completion of the call at the same web link, and will
remain available for approximately 90 days.
About Teladoc Health
Teladoc Health empowers all people everywhere to live their
healthiest lives by transforming the healthcare experience. As the
world leader in whole-person virtual care, Teladoc Health uses
proprietary health signals and personalized interactions to drive
better health outcomes across the full continuum of care, at every
stage in a person’s health journey. Ranked best in KLAS for Virtual
Care Platforms in 2020 and #1 among direct-to-consumer telehealth
providers in the J.D. Power 2021 U.S. Telehealth Satisfaction
Study, Teladoc Health leverages more than a decade of expertise and
data-driven insights to meet the growing virtual care needs of
consumers and healthcare professionals. For more information,
please visit www.teladochealth.com or
follow @TeladocHealth on Twitter.
Cautionary Note Regarding Forward-Looking
Statements
This press release contains “forward-looking statements” within
the meaning of the safe harbor provisions of the U.S. Private
Securities Litigation Reform Act of 1995. Forward-looking
statements can be identified by words such as: “anticipate,”
“intend,” “plan,” “believe,” “project,” “estimate,” “expect,”
“may,” “should,” “will” and similar references to future periods.
Examples of forward-looking statements include, among others,
statements we make regarding future revenues, future earnings,
future numbers of members or clients, litigation outcomes,
regulatory developments, market developments, new products and
growth strategies, and the effects of any of the foregoing on our
future results of operations or financial condition.
Forward-looking statements are neither historical facts nor
assurances of future performance. Instead, they are based only on
our current beliefs, expectations and assumptions regarding the
future of our business, future plans and strategies, projections,
anticipated events and trends, the economy and other future
conditions. Because forward-looking statements relate to the
future, they are subject to inherent uncertainties, risks and
changes in circumstances that are difficult to predict and many of
which are outside of our control. Our actual results and financial
condition may differ materially from those indicated in the
forward-looking statements. Important factors that could cause our
actual results and financial condition to differ materially from
those indicated in the forward-looking statements include, among
others, the following: (i) changes in laws and regulations
applicable to our business model; (ii) changes in market conditions
and receptivity to our services and offerings; (iii) results of
litigation; (iv) the loss of one or more key clients; (v) changes
to our abilities to recruit and retain qualified providers into our
network; and (vi) the impact of the COVID-19 pandemic on our
operations, demand for our services and general economic
conditions, as well as orders, directives and legislative action by
local, state, federal and foreign governments in response to the
spread of COVID-19. For a detailed discussion of the risk factors
that could affect our actual results, please refer to the risk
factors identified in our SEC reports, including, but not limited
to, our Annual Report on Form 10-K and Quarterly Reports on Form
10-Q, as filed with the SEC.
Any forward-looking statement made by us in this press release
is based only on information currently available to us and speaks
only as of the date on which it is made. We undertake no obligation
to publicly update any forward-looking statement, whether written
or oral, that may be made from time to time, whether as a result of
new information, future developments or otherwise.
|
TELADOC HEALTH, INC.CONSOLIDATED BALANCE
SHEETS(In thousands, except share and per share
data, unaudited) |
|
|
|
|
|
|
|
|
|
September 30, |
|
December 31, |
|
|
2021 |
|
2020 |
|
|
|
|
|
|
Assets |
|
|
|
|
|
|
Current assets: |
|
|
|
|
|
|
Cash and cash equivalents |
|
$ |
823,828 |
|
|
$ |
733,324 |
|
Short-term investments |
|
|
2,538 |
|
|
|
53,245 |
|
Accounts receivable, net of allowance of $11,277 and $6,412,
respectively |
|
|
178,072 |
|
|
|
169,281 |
|
Inventories |
|
|
56,937 |
|
|
|
56,498 |
|
Prepaid expenses and other current assets |
|
|
95,941 |
|
|
|
47,259 |
|
Total current assets |
|
|
1,157,316 |
|
|
|
1,059,607 |
|
Property and equipment, net |
|
|
27,027 |
|
|
|
28,551 |
|
Goodwill |
|
|
14,470,399 |
|
|
|
14,581,255 |
|
Intangible assets, net |
|
|
1,932,012 |
|
|
|
2,020,864 |
|
Operating lease - right-of-use assets |
|
|
47,935 |
|
|
|
46,647 |
|
Other assets |
|
|
17,890 |
|
|
|
18,357 |
|
Total assets |
|
$ |
17,652,579 |
|
|
$ |
17,755,281 |
|
Liabilities and stockholders’
equity |
|
|
|
|
|
|
Current liabilities: |
|
|
|
|
|
|
Accounts payable |
|
$ |
34,655 |
|
|
$ |
46,030 |
|
Accrued expenses and other current liabilities |
|
|
106,252 |
|
|
|
83,657 |
|
Accrued compensation |
|
|
75,891 |
|
|
|
94,593 |
|
Deferred revenue-current |
|
|
72,865 |
|
|
|
52,356 |
|
Advances from financing companies |
|
|
12,442 |
|
|
|
13,453 |
|
Current portion of long-term debt |
|
|
0 |
|
|
|
42,560 |
|
Total current liabilities |
|
|
302,105 |
|
|
|
332,649 |
|
Other liabilities |
|
|
1,328 |
|
|
|
1,616 |
|
Operating lease liabilities, net of current portion |
|
|
42,729 |
|
|
|
43,142 |
|
Deferred revenue, net of current portion |
|
|
4,075 |
|
|
|
2,449 |
|
Advances from financing companies, net of current portion |
|
|
9,561 |
|
|
|
9,926 |
|
Deferred taxes |
|
|
93,824 |
|
|
|
102,103 |
|
Convertible senior notes, net |
|
|
1,211,375 |
|
|
|
1,379,592 |
|
Commitments and
contingencies |
|
|
|
|
|
|
Stockholders’ equity: |
|
|
|
|
|
|
Common stock, $0.001 par value; 300,000,000 shares authorized as of
September 30, 2021 and December 31, 2020; 160,013,751 shares and
150,281,099 shares issued and outstanding as of September 30, 2021
and December 31, 2020, respectively |
|
|
160 |
|
|
|
150 |
|
Additional paid-in capital |
|
|
17,399,023 |
|
|
|
16,857,797 |
|
Accumulated deficit |
|
|
(1,410,469 |
) |
|
|
(992,661 |
) |
Accumulated other comprehensive (loss) gain |
|
|
(1,132 |
) |
|
|
18,518 |
|
Total stockholders’ equity |
|
|
15,987,582 |
|
|
|
15,883,804 |
|
Total liabilities and stockholders’ equity |
|
$ |
17,652,579 |
|
|
$ |
17,755,281 |
|
|
|
|
|
|
|
|
|
|
|
TELADOC HEALTH, INC.CONSOLIDATED
STATEMENTS OF OPERATIONS(In thousands, except
share and per share data, unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Quarter Ended September 30, |
|
Nine Months Ended September 30, |
|
|
2021 |
|
2020 |
|
2021 |
|
2020 |
Revenue |
|
$ |
521,658 |
|
|
$ |
288,812 |
|
|
$ |
1,478,472 |
|
|
$ |
710,641 |
|
Expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
Cost of revenue (exclusive of depreciation and amortization, which
is shown separately below) |
|
|
169,041 |
|
|
|
104,725 |
|
|
|
475,273 |
|
|
|
267,887 |
|
Operating expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
Advertising and marketing |
|
|
111,078 |
|
|
|
52,302 |
|
|
|
303,738 |
|
|
|
132,395 |
|
Sales |
|
|
62,602 |
|
|
|
23,483 |
|
|
|
191,251 |
|
|
|
60,110 |
|
Technology and development |
|
|
80,250 |
|
|
|
29,958 |
|
|
|
239,017 |
|
|
|
72,244 |
|
Acquisition, integration and transformation costs |
|
|
4,340 |
|
|
|
25,395 |
|
|
|
22,084 |
|
|
|
30,686 |
|
General and administrative |
|
|
103,016 |
|
|
|
59,742 |
|
|
|
319,404 |
|
|
|
162,699 |
|
Depreciation and amortization |
|
|
51,907 |
|
|
|
12,932 |
|
|
|
151,907 |
|
|
|
32,535 |
|
Total expenses |
|
|
582,234 |
|
|
|
308,537 |
|
|
|
1,702,674 |
|
|
|
758,556 |
|
Loss from operations |
|
|
(60,576 |
) |
|
|
(19,725 |
) |
|
|
(224,202 |
) |
|
|
(47,915 |
) |
Loss on extinguishment of
debt |
|
|
850 |
|
|
|
1,227 |
|
|
|
43,728 |
|
|
|
8,978 |
|
Other expense (income),
net |
|
|
376 |
|
|
|
252 |
|
|
|
(5,493 |
) |
|
|
827 |
|
Interest expense, net |
|
|
18,895 |
|
|
|
16,970 |
|
|
|
61,493 |
|
|
|
38,849 |
|
Net loss before taxes |
|
|
(80,697 |
) |
|
|
(38,174 |
) |
|
|
(323,930 |
) |
|
|
(96,569 |
) |
Income tax expense
(benefit) |
|
|
3,643 |
|
|
|
(2,290 |
) |
|
|
93,878 |
|
|
|
(5,400 |
) |
Net loss |
|
$ |
(84,340 |
) |
|
$ |
(35,884 |
) |
|
$ |
(417,808 |
) |
|
$ |
(91,169 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss per share, basic and
diluted |
|
$ |
(0.53 |
) |
|
$ |
(0.43 |
) |
|
$ |
(2.68 |
) |
|
$ |
(1.17 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted-average shares used
to compute basic and diluted net loss per share |
|
|
159,435,165 |
|
|
|
83,607,902 |
|
|
|
155,926,680 |
|
|
|
77,821,073 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TELADOC HEALTH, INC.CONSOLIDATED
STATEMENTS OF CASH FLOWS (In thousands,
unaudited) |
|
|
|
|
|
|
|
|
|
Nine Months Ended September 30, |
|
|
2021 |
|
2020 |
Cash flows provided by
operating activities: |
|
|
|
|
|
|
Net loss |
|
$ |
(417,808 |
) |
|
$ |
(91,169 |
) |
Adjustments to reconcile net
loss to net cash provided by operating activities: |
|
|
|
|
|
|
Depreciation and amortization |
|
|
151,907 |
|
|
|
32,535 |
|
Depreciation of rental equipment |
|
|
2,500 |
|
|
|
851 |
|
Amortization of right-of-use assets |
|
|
8,185 |
|
|
|
4,643 |
|
Allowance for doubtful accounts |
|
|
11,353 |
|
|
|
2,320 |
|
Stock-based compensation |
|
|
240,971 |
|
|
|
61,151 |
|
Deferred income taxes |
|
|
91,414 |
|
|
|
(4,096 |
) |
Accretion of interest |
|
|
46,843 |
|
|
|
29,459 |
|
Loss on extinguishment of debt |
|
|
40,631 |
|
|
|
8,978 |
|
Gain on sale of investment |
|
|
(5,901 |
) |
|
|
0 |
|
Other, net |
|
|
38 |
|
|
|
216 |
|
Changes in operating assets
and liabilities: |
|
|
|
|
|
|
Accounts receivable |
|
|
(19,407 |
) |
|
|
(16,450 |
) |
Prepaid expenses and other current assets |
|
|
(34,566 |
) |
|
|
(5,906 |
) |
Inventory |
|
|
(2,661 |
) |
|
|
(2,392 |
) |
Other assets |
|
|
(3,432 |
) |
|
|
140 |
|
Accounts payable |
|
|
(11,115 |
) |
|
|
6,584 |
|
Accrued expenses and other current liabilities |
|
|
15,880 |
|
|
|
17,269 |
|
Accrued compensation |
|
|
(17,352 |
) |
|
|
9,329 |
|
Deferred revenue |
|
|
20,002 |
|
|
|
15,348 |
|
Operating lease liabilities |
|
|
(8,202 |
) |
|
|
(4,360 |
) |
Other liabilities |
|
|
1,502 |
|
|
|
(3,025 |
) |
Net cash provided by operating
activities |
|
|
110,782 |
|
|
|
61,425 |
|
Cash flows used in investing
activities: |
|
|
|
|
|
|
Capital expenditures |
|
|
(5,611 |
) |
|
|
(2,872 |
) |
Capitalized software development costs |
|
|
(35,402 |
) |
|
|
(14,515 |
) |
Proceeds from marketable securities |
|
|
50,000 |
|
|
|
0 |
|
Proceeds from the sale of investment |
|
|
10,901 |
|
|
|
0 |
|
Acquisitions of business, net of cash acquired |
|
|
(75,944 |
) |
|
|
(159,663 |
) |
Other, net |
|
|
3,150 |
|
|
|
0 |
|
Net cash used in investing
activities |
|
|
(52,906 |
) |
|
|
(177,050 |
) |
Cash flows provided by
financing activities: |
|
|
|
|
|
|
Net proceeds from the exercise of stock options |
|
|
22,956 |
|
|
|
40,627 |
|
Proceeds from issuance of 2027 Notes |
|
|
0 |
|
|
|
1,000,000 |
|
Payment of issuance costs of 2027 Notes |
|
|
0 |
|
|
|
(24,070 |
) |
Repurchase of 2022 Notes |
|
|
(139 |
) |
|
|
(228,153 |
) |
Proceeds from advances from financing companies |
|
|
10,677 |
|
|
|
1,924 |
|
Payment against advances from financing companies |
|
|
(12,053 |
) |
|
|
(4,427 |
) |
Proceeds from employee stock purchase plan |
|
|
13,996 |
|
|
|
2,473 |
|
Cash received for withholding taxes on stock-based compensation,
net |
|
|
3,109 |
|
|
|
326 |
|
Other, net |
|
|
(4,224 |
) |
|
|
0 |
|
Net cash provided by financing
activities |
|
|
34,322 |
|
|
|
788,700 |
|
Net increase in cash and cash
equivalents |
|
|
92,198 |
|
|
|
673,075 |
|
Foreign exchange
difference |
|
|
(1,694 |
) |
|
|
(129 |
) |
Cash and cash equivalents at
beginning of the period |
|
|
733,324 |
|
|
|
514,353 |
|
Cash and cash equivalents at
end of the period |
|
$ |
823,828 |
|
|
$ |
1,187,299 |
|
|
|
|
|
|
|
|
Income taxes paid |
|
$ |
3,114 |
|
|
$ |
786 |
|
|
|
|
|
|
|
|
Interest paid |
|
$ |
7,973 |
|
|
$ |
5,612 |
|
|
|
|
|
|
|
|
|
|
Stock-based Compensation Summary
Total compensation costs for stock-based awards were recorded as
follows (in thousands):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Quarter Ended |
|
Nine Months Ended |
|
|
September 30, |
|
September 30, |
|
|
2021 |
|
2020 |
|
2021 |
|
2020 |
Cost of revenue (exclusive of
depreciation and amortization, which is shown separately) |
|
$ |
2,162 |
|
|
$ |
128 |
|
|
$ |
6,310 |
|
|
$ |
128 |
|
Advertising and marketing |
|
|
5,244 |
|
|
|
1,644 |
|
|
|
15,141 |
|
|
|
4,447 |
|
Sales |
|
|
17,518 |
|
|
|
3,275 |
|
|
|
57,638 |
|
|
|
9,465 |
|
Technology and
development |
|
|
22,910 |
|
|
|
2,622 |
|
|
|
77,335 |
|
|
|
7,285 |
|
General and
administrative |
|
|
23,867 |
|
|
|
13,239 |
|
|
|
84,547 |
|
|
|
39,826 |
|
Total stock-based compensation
expense (1) |
|
$ |
71,701 |
|
|
$ |
20,908 |
|
|
$ |
240,971 |
|
|
$ |
61,151 |
|
(1) Excluding the amount capitalized related to
internal software development projects.
Non-GAAP Financial Measures:
To supplement our financial information presented in accordance
with GAAP, we use adjusted gross profit, adjusted gross margin,
EBITDA and adjusted EBITDA, which are non-GAAP financial measures,
to clarify and enhance an understanding of past performance. We
believe that the presentation of these financial measures enhances
an investor’s understanding of our financial performance. We
further believe that these financial measures are useful financial
metrics to assess our operating performance from period-to-period
by excluding certain items that we believe are not representative
of our core business. We use certain financial measures for
business planning purposes and in measuring our performance
relative to that of our competitors. We utilize adjusted EBITDA as
the primary measure of our performance.
Adjusted gross profit is our total revenue minus our total cost
of revenue (exclusive of depreciation and amortization, which is
shown separately) and adjusted gross margin is adjusted gross
profit as a percentage of our total revenue. We believe that these
measures provide investors meaningful information to understand our
results of operations and the ability to analyze financial and
business trends on a period-to-period basis.
EBITDA consists of net loss before interest; other expense
(income), net, including foreign exchange gain or loss; taxes;
depreciation and amortization; and loss on extinguishment of debt.
Adjusted EBITDA consists of net loss before interest; other expense
(income), net, including foreign exchange gain or loss; taxes;
depreciation and amortization; loss on extinguishment of debt;
stock-based compensation; and acquisition, integration and
transformation costs. We believe that making such adjustments
provides investors meaningful information to understand our results
of operations and the ability to analyze financial and business
trends on a period-to-period basis.
We believe the above financial measures are commonly used by
investors to evaluate our performance and that of our competitors.
However, our use of the terms adjusted gross profit, adjusted gross
margin, EBITDA and adjusted EBITDA may vary from that of others in
our industry. None of adjusted gross profit, adjusted gross margin,
EBITDA nor adjusted EBITDA should be considered as an alternative
to net loss before taxes, net loss, net loss per share or any other
performance measures derived in accordance with GAAP.
Adjusted gross profit, adjusted gross margin, EBITDA and
adjusted EBITDA have important limitations as analytical tools and
you should not consider them in isolation or as a substitute for
analysis of our results as reported under GAAP. Some of these
limitations are:
- Adjusted gross margin has been and
will continue to be affected by a number of factors, including the
fees we charge our clients, the number of visits and cases we
complete, the costs paid to providers and medical experts, as well
as the costs of our provider network operations center;
- Adjusted gross margin does not
reflect the significant depreciation and amortization to cost of
revenue;
- EBITDA and adjusted EBITDA do not
reflect the significant interest expense on our debt;
- EBITDA and adjusted EBITDA eliminate
the impact of income taxes on our results of operations;
- EBITDA and adjusted EBITDA do not
reflect the loss on extinguishment of debt;
- EBITDA and adjusted EBITDA do not
reflect other expense (income), net;
- Adjusted EBITDA does not reflect the
significant acquisition, integration and transformation costs.
Acquisition, integration and transformation costs include
investment banking, financing, legal, accounting, consultancy,
integration, fair value changes related to contingent consideration
and certain other transaction costs related to mergers and
acquisitions. It also includes costs related to certain business
transformation initiatives focused on integrating and optimizing
various operations and systems, including upgrading our customer
relationship management (CRM) and enterprise resource planning
(ERP) systems. These transformation cost adjustments made to our
results do not represent normal, operating expenses necessary to
operate the business but rather, incremental costs incurred in
connection with our acquisition and integration activities;
- Adjusted EBITDA does not reflect the
significant non-cash stock compensation expense which should be
viewed as a component of recurring operating costs; and
- other companies in our industry may
calculate adjusted gross profit, adjusted gross margin, EBITDA and
adjusted EBITDA differently than we do, limiting the usefulness of
these measures as comparative measures.
In addition, although depreciation and amortization are non-cash
charges, the assets being depreciated and amortized will often have
to be replaced in the future, and adjusted gross profit, adjusted
gross margin, EBITDA and adjusted EBITDA do not reflect any
expenditures for such replacements.
We compensate for these limitations by using adjusted gross
profit, adjusted gross margin, EBITDA and adjusted EBITDA along
with other comparative tools, together with GAAP measurements, to
assist in the evaluation of operating performance. Such GAAP
measurements include net loss, net loss per share and other
performance measures.
In evaluating these financial measures, you should be aware that
in the future we may incur expenses similar to those eliminated in
this presentation. Our presentation of adjusted gross profit,
adjusted gross margin, EBITDA and adjusted EBITDA should not be
construed as an inference that our future results will be
unaffected by unusual or nonrecurring items.
We have not reconciled EBITDA or adjusted EBITDA guidance to
GAAP net loss because we do not provide guidance on the individual
reconciling items between EBITDA and adjusted EBITDA and GAAP net
loss. This is due to the uncertainty as to timing, and the
potential variability, of the individual reconciling items such as
the tax impact of share-based compensation, the effect of which may
be significant. Accordingly, a reconciliation of the non-GAAP
financial measure guidance to the corresponding GAAP measure is not
available without unreasonable effort.
The following is a reconciliation of gross profit and gross
margin, the most directly comparable GAAP financial measures, to
adjusted gross profit and adjusted gross margin, respectively:
Reconciliation of GAAP Gross Profit to Adjusted Gross
Profit and Adjusted Gross Margin(In thousands,
unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Quarter Ended |
|
Nine Months Ended |
|
|
|
September 30, |
|
September 30, |
|
|
|
2021 |
|
2020 |
|
2021 |
|
2020 |
|
Revenue |
|
$ |
521,658 |
|
|
$ |
288,812 |
|
|
$ |
1,478,472 |
|
|
$ |
710,641 |
|
|
Cost of revenue (exclusive of
depreciation and amortization, which is shown separately
below) |
|
|
(169,041 |
) |
|
|
(104,725 |
) |
|
|
(475,273 |
) |
|
|
(267,887 |
) |
|
Depreciation and amortization
of intangible assets |
|
|
(2,545 |
) |
|
|
(1,149 |
) |
|
|
(8,233 |
) |
|
|
(4,078 |
) |
|
Gross Profit |
|
|
350,072 |
|
|
|
182,938 |
|
|
|
994,966 |
|
|
|
438,676 |
|
|
Depreciation and amortization
of intangible assets |
|
|
2,545 |
|
|
|
1,149 |
|
|
|
8,233 |
|
|
|
4,078 |
|
|
Adjusted gross profit |
|
$ |
352,617 |
|
|
$ |
184,087 |
|
|
$ |
1,003,199 |
|
|
$ |
442,754 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross margin |
|
|
67.1 |
|
% |
|
63.3 |
|
% |
|
67.3 |
|
% |
|
61.7 |
|
% |
Adjusted gross margin |
|
|
67.6 |
|
% |
|
63.7 |
|
% |
|
67.9 |
|
% |
|
62.3 |
|
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The following is a reconciliation of Net Loss, the most directly
comparable GAAP financial measure, to EBITDA and adjusted
EBITDA:
Reconciliation of GAAP Net Loss to EBITDA and Adjusted
EBITDA(In thousands, unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Quarter Ended |
|
Nine Months Ended |
|
|
September 30, |
|
September 30, |
|
|
2021 |
|
2020 |
|
2021 |
|
2020 |
Net loss |
|
$ |
(84,340 |
) |
|
$ |
(35,884 |
) |
|
$ |
(417,808 |
) |
|
$ |
(91,169 |
) |
Add: |
|
|
|
|
|
|
|
|
|
|
|
|
Loss on extinguishment of
debt |
|
|
850 |
|
|
|
1,227 |
|
|
|
43,728 |
|
|
|
8,978 |
|
Other expense (income),
net |
|
|
376 |
|
|
|
252 |
|
|
|
(5,493 |
) |
|
|
827 |
|
Interest expense, net |
|
|
18,895 |
|
|
|
16,970 |
|
|
|
61,493 |
|
|
|
38,849 |
|
Income tax expense
(benefit) |
|
|
3,643 |
|
|
|
(2,290 |
) |
|
|
93,878 |
|
|
|
(5,400 |
) |
Depreciation and
amortization |
|
|
51,907 |
|
|
|
12,932 |
|
|
|
151,907 |
|
|
|
32,535 |
|
EBITDA |
|
|
(8,669 |
) |
|
|
(6,793 |
) |
|
|
(72,295 |
) |
|
|
(15,380 |
) |
Stock-based compensation |
|
|
71,701 |
|
|
|
20,908 |
|
|
|
240,971 |
|
|
|
61,151 |
|
Acquisition, integration and
transformation costs |
|
|
4,340 |
|
|
|
25,395 |
|
|
|
22,084 |
|
|
|
30,686 |
|
Adjusted EBITDA |
|
$ |
67,372 |
|
|
$ |
39,510 |
|
|
$ |
190,760 |
|
|
$ |
76,457 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Investors:Patrick
Feeley914-265-7925IR@teladochealth.com
Media:Chris
Stenrud860-491-8821pr@teladochealth.com
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