Q2 2025 Teladoc Inc Earnings Call

July 29, 2025

Operator: Moderator today. All lines will be muted during the presentation portion of the call, with an opportunity for questions and answers at the end. If you would like to ask a question, please press star followed by one on your telephone keypad. I would now like to pass the conference over to Mike Minchak, Head of Investor Relations for Teladoc Health. Thank you. You may proceed.

During the presentation portion of the call with an opportunity for questions and answers at the end if you'd like to ask a question. Please press star followed by one on your telephone keypad.

I would now like to pass the conference over to Mike <unk> head of Investor Relations for Dog Health. Thank you you May proceed.

Thank you and good afternoon.

Mike Minchak: Thank you, and good afternoon. Today, after the market close, we issued a press release announcing our Q2 2025 financial results. This press release and the accompanying slide presentation are available in the Investor Relations section of the teladochealth.com website. On this call to discuss our results are Chuck Divita, Chief Executive Officer, and Mala Murthy, Chief Financial Officer. During this call, we will also discuss our outlook, and our prepared remarks will be followed by a question-and-answer session. Please note that we will be discussing certain non-GAAP financial measures that we believe are important in evaluating our performance. Details on the relationship between these non-GAAP measures to the most comparable GAAP measures and reconciliations thereof can be found in the press release that is posted on our website.

After the market close we issued a press release announcing our second quarter 2025 financial results. This press release and the accompanying slide presentation are available in the Investor Relations section of the Teladoc health Dot Com website.

On this call to discuss our results are Chuck Davita, Chief Executive Officer, and Mala Murthy, Chief Financial Officer.

During this call. We will also discuss our outlook and our prepared remarks will be followed by a question and answer session. Please.

Please note that we will be discussing certain non-GAAP financial measures that we believe are important in evaluating our performance details on the relationship between these non-GAAP measures to the most comparable GAAP measures and reconciliations thereof can be found in the press release that is posted on our website.

Please note that certain statements made during this call will be forward looking statements as defined by the private Securities Litigation Reform Act of 1095.

Mike Minchak: Also, please note that certain statements made during this call will be forward-looking statements as defined by the Private Securities Litigation Reform Act of 1995. Such forward-looking statements are subject to risks, uncertainties, and other factors that could cause our actual results to differ materially from those expressed or implied on this call. For additional information, please refer to our cautionary statement in our press release and our filings with the SEC, all of which are available on our website. I would now like to turn the call over to Chuck.

Such forward looking statements are subject to risks uncertainties and other factors that could cause our actual results to differ materially from those expressed or implied on this call for additional information. Please refer to our cautionary statement in our press release and our filings with the SEC all of which are available on our website.

I would now like to turn the call over to Chuck.

Thanks, Mike I am pleased with our strong performance in the second quarter, our consolidated revenue and adjusted EBITDA, both at the higher end of our guidance ranges.

Chuck Divita: Thanks, Mike. I'm pleased with our strong performance in the second quarter, with consolidated revenue and Adjusted EBITDA both at the higher end of our guidance ranges. This reflects continued disciplined execution and builds on our solid results from the first quarter. Based on our results and outlook for the second half of the year, we're narrowing our guidance range in 2025 consolidated revenue and Adjusted EBITDA. Mala will provide more details on our performance and outlook later in the call. It's now been a year since I joined Teladoc Health, and I would like to take the opportunity to comment on the progress we've made and the direction of the company. It's been a transformative year in many respects, as we've worked with urgency and purpose to improve performance and reposition the business.

This reflects continued disciplined execution and builds on our solid results from the first quarter.

Based on our results and outlook for the second half of the year, we're narrowing our guidance range in 2025 consolidated revenue and adjusted EBITDA.

<unk> will provide more details on our performance and outlook later in the call.

It's now been a year since I joined Teladoc health and I would like to take the opportunity to comment on the progress we've made and the direction of the company.

It's been a transformative year in many respects as we've worked with urgency and purpose to improve performance and reposition the business.

As I shared when I first joined I saw the need to strengthen our market focus and increase the efficiency of our business.

Chuck Divita: As I shared when I first joined, I saw the need to strengthen our market focus and increase the efficiency of our business, and we've taken decisive actions that have resulted in a more streamlined organization with greater agility and market orientation, and a more efficient and scalable cost structure. I also shared the importance of accelerating innovation across our products and capabilities. We've made considerable progress in that regard, including a product innovation pipeline that's gaining momentum. Let me share some examples. We recently launched WellBound, a new employee assistance program offering for the US integrated care market. It provides mental health and wellbeing support, including access to online therapy services from BetterHelp and seamless access to other available Teladoc services. While early, we're pleased with the level of interest we're seeing, and we look forward to building a position in the EAP market.

And we've taken decisive actions that have resulted in a more streamlined organization with greater agility and market orientation, and a more efficient and scalable cost structure.

I also shared the importance of accelerating innovation across our products and capabilities.

We've made considerable progress in that regard, including our product innovation pipeline, that's gaining momentum let me share some examples.

We recently launched well bound a new employee assistance program offering for the U S integrated care market.

It provides mental health and wellbeing support.

Putting access to online therapy services from better health and seamless access to other available Teladoc services.

While early we're pleased with the level of interest we are seeing and we look forward to building our position in the EAP market.

We're enhancing our cardio metabolic health program this year, including new connected devices as well as registered dietitian access sleep support and other new features and to further engage and support enrollees with rising risk in higher acuity conditions, we are developing additional clinical interventions leveraging our primary care specialist.

Chuck Divita: We're enhancing our Cardiometabolic Health Program this year, including new connected devices, as well as registered dietitian access, sleep support, and other new features. And to further engage and support enrollees with rising risk and higher acuity conditions, we're developing additional clinical interventions leveraging our primary care, specialist, and care support teams. We believe that a comprehensive approach focused on both prevention and the progression of diabetes, hypertension, and obesity will have the greatest sustained impact on patient health and value for our clients. For our hospital and health system clients, we launched a new AI-enabled Virtual Sitter solution fully integrated into our proprietary technology. This new offering extends and supports our clients' workforce capacity and their care delivery and patient safety objectives, including matters such as fall risk and patient elopement.

And care support teams.

We believe that a comprehensive approach focused on both prevention and the progression of diabetes hypertension, and obesity, but the greatest sustained impact on patient health and value for our clients.

For our hospital and health system clients, we launched a new AI enabled virtual center solution fully integrated into our proprietary technology.

This new offering extends and supports our clients' workforce capacity and their care delivery and patient safety objectives, including matters, such as fall risk and patient will open.

And our international integrated care business. We also continued to add new solutions, including hybrid care models for public health systems to support a variety of needs, including access to primary care and emergency Department care in rural and remote communities.

Chuck Divita: In our international Integrated Care business, we also continue to add new solutions, including hybrid care models for public health systems to support a variety of needs, including access to primary care and emergency department care in rural and remote communities. Product innovation will be an ongoing focus of our organization. Over the past year, we've also added important capabilities, including through strategic acquisitions. Catapult Health strengthens our approach to preventative care through its virtual checkup and other solutions, as well as being an important and complementary engagement capability with other Teladoc services. We recently acquired Uplift to support BetterHelp's entry into insurance, an important initiative I also shared when I joined the company. I'll provide an update on our progress in this area in a moment.

Innovation will be an ongoing focus of our organization.

Over the past year, we've also added important capabilities, including through strategic acquisitions.

Catapult health strengthens our approach to preventative care through its virtual checkup and other solutions as well as being an important and complementary engagement capability with other Teladoc services.

And we've recently acquired uplift to support better helps entry into insurance and important initiative I also shared when I joined the company.

I'll provide an update on our progress in this area in a moment.

Additionally, we've strengthened operational execution added new partnerships and collaborations and made advancements in our technological infrastructure.

Chuck Divita: Additionally, we've strengthened operational execution, added new partnerships and collaborations, and made advancements in our technological infrastructure, all aimed at supporting our strategic priorities and our ability to deliver more services and value to customers. We've also hit some noteworthy milestones, including exceeding 100 million US Integrated Care members, providing additional opportunities to grow our services over time. While there is important work ahead, I'm pleased with the progress overall, and I'm confident we're in a stronger position to execute in an evolving market. As we've all seen, the healthcare challenges are substantial. Affordability and rising costs, the impact of disease and chronic conditions, unmet mental health needs, provider pressures, and other issues continue to impact all stakeholders, and it's clear to us that virtual care can and must play a greater role going forward, given the extent and magnitude of these challenges.

All aimed at supporting our strategic priorities and our ability to deliver more services and value to customers.

We've also had some noteworthy milestones, including exceeding 100 million U S integrated care members, providing additional opportunities to grow our services over time.

While there is important work ahead I am pleased with the progress overall and I'm confident we're in a stronger position to execute in an evolving market.

As we've all seen the healthcare challenges are substantial.

Affordability and rising costs, the impact of disease, and chronic conditions unmet mental health needs provider pressures and other issues continue to impact all stakeholders and it's clear to us that virtual care can and must play a greater role going forward given the extent and magnitude of these challenges.

Prior to 2020 virtual care was largely about convenience and access to quality cost effective care.

Chuck Divita: Prior to 2020, virtual care was largely about convenience and access to quality, cost-effective care. Teladoc led the way through technology, services, and scale, and also delivered during the pandemic. Now, virtual care has become widely adopted, and there's also been a proliferation of point solutions, adding to fragmentation and complexity. Teladoc again led the way by taking an integrated approach across physical health, mental health, and chronic conditions, placing the whole patient at the center. Looking ahead, we intend to build on our leadership position, our assets, clinical capabilities, and range of services with an intensified focus on orchestration across patients, providers, platforms, and partners, all aimed at enhancing the patient experience, improving outcomes, and delivering greater value. We're uniquely positioned to advance this important work, and we're prioritizing investments that are aligned with this vision, and we plan to deliver on it through our four strategic priorities.

Teladoc led the way through technology services and scale and also delivered during the pandemic.

Now virtual care has become widely adopted and there has also been a proliferation of point solutions, adding to fragmentation and complexity.

Teladoc again led the way by taking an integrated approach across physical health mental health and chronic conditions, placing the whole patient at the center.

Looking ahead, we intend to build on our leadership position our assets clinical capabilities and range of services with an intensified focus on orchestration.

Across patients providers platforms and partners all aimed at enhancing the patient experience improving outcomes and delivering greater value.

We're uniquely positioned to advance this important work and we're prioritizing investments that are aligned with this vision.

And we plan to deliver on it through our four strategic priorities.

First we're enhancing our integrated care offerings, particularly in the U S to drive a greater impact on both clinical outcomes and the cost equation.

Chuck Divita: First, we're enhancing our integrated care offerings, particularly in the US, to drive a greater impact on both clinical outcomes and the cost equation. We'll support our growth objectives through continued product innovation, and we intend to launch new and enhanced offerings across our portfolio on a sustained basis. By leveraging our millions of engagement points in new and unique ways, advancing clinical intervention opportunities, and orchestrating care more holistically, we intend to deliver greater value for clients and the people we serve. Second, we're further leveraging our scaled mental health position. In addition to new products, such as WellBound, we have several initiatives underway to expand mental health access and our ability to serve more needs.

We will support our growth objectives through continued product innovation, and we intend to launch new and enhanced offerings across our portfolio on a sustained basis.

By leveraging our millions of engagement points, and new and unique ways advancing clinical intervention opportunities and orchestrate incur more holistically, we intend to deliver greater value for clients and the people we serve.

Second we're further leveraging our scaled mental health position in.

In addition to new products, such as well bound we have several initiatives underway to expand mental health access and our ability to serve more needs.

This includes momentum in integrated care, where we saw a 13% year over year increase in mental health visits in the U S. During the second quarter.

Chuck Divita: This includes momentum in Integrated Care, where we saw a 13% year-over-year increase in mental health visits in the US during Q2, and in BetterHelp, where we'll be building on our unparalleled consumer position by adding insurance capabilities to grow and expand our market opportunity. On that front, I would like to take a moment to provide an update on BetterHelp's insurance coverage initiative. As we've shared, we believe insurance will leverage BetterHelp's strong consumer activation, experience, and scale, while having a positive impact on conversion rates, the number of user sessions, and return on advertising spend over time. With ongoing headwinds in the consumer cash pay business, we see insurance coverage as essential to the stability and growth outlook for BetterHelp, and we believe we can meaningfully scale insurance over time. We are being methodical in our approach to ensure the long-term success of this business.

And in better health, where we will be building on our unparalleled consumer position by adding insurance capabilities to grow and expand our market opportunity.

On that front I would like to take a moment to provide an update on better helps insurance coverage initiative.

As we've shared we believe insurance will leverage better help strong consumer activation experience and scale.

While having a positive impact on conversion rates the number of users sessions and return on advertising spend over time.

With ongoing headwinds in the consumer cash pay business, we see insurance coverage is essential to the stability and growth outlook for better health.

And we believe we can meaningfully scale insurance over time.

We are being methodical in our approach to ensure the long term success of this business. This includes ensuring a robust and scalable operating infrastructure growing our network of credentialed mental health professionals, and supporting and expanding our payer relationships and corresponding membership coverage.

Chuck Divita: This includes ensuring a robust and scalable operating infrastructure, growing our network of credentialed mental health professionals, and supporting and expanding our payer relationships and corresponding membership coverage. From an operating infrastructure standpoint, the BetterHelp and Uplift teams are partnering in a seamless way. Execution is progressing well, including unifying the platforms and experience and ability to leverage and scale the combined capabilities. In late June, we began a soft launch of BetterHelp Insurance in a single state, laying the groundwork for a methodical ramp of the business over the next several quarters. We're encouraged by the early results, including the performance of our technology, the strength, reliability, and durability of the insurance processes, and growth of the insurance provider network. We see significant opportunities to access and leverage BetterHelp's expansive network of 35,000 therapists to support growth in the insurance network.

From an operating infrastructure standpoint to better help an uplift teams are partnering in a seamless way.

Execution is progressing well, including unifying the platforms and experience and ability to leverage and scale of the combined capabilities.

In late June we began a soft launch of better health insurance and a single state laying the groundwork for a methodical ramp of the business over the next several quarters.

We're encouraged by the early results, including the performance of our technology, the strength reliability and durability of the insurance processes and growth of the insurance provider network.

We see significant opportunities to access and leverage better helps expansive network of 35000 therapist to support growth in the insurance network.

As a reminder, better helps therapists are all fully licensed and with a master's degree or higher.

Chuck Divita: As a reminder, BetterHelp's therapists are all fully licensed and with a master's degree or higher. The network averages 8 years of experience and consistently delivers results, including over 70% of patients reporting symptom reduction within 12 weeks, as well as high satisfaction rates, including over 80% of patients that would recommend their therapist to others. In this regard, we've begun initial outreach to many of our BetterHelp therapists to join the insurance network, and we're seeing good interest. To date, over 2,000 have engaged and are now in various stages of the credentialing process. This outreach will continue as we look to complement and further build on Uplift's already robust base of over 1,500 mental health professionals. We're also seeing success in further expanding payer relationships.

The network average is eight years of experience and consistently delivers results, including over 70% of patients reporting symptom reduction within 12 weeks.

As well as high satisfaction rates, including over 80% of patients that would recommend their therapist to others.

In this regard we've begun initial outreach to many of our better health therapist to join the insurance network and.

And we're seeing good interest.

To date over 2000 have engaged and are now in various stages of the credentialing process.

This outreach will continue as we look to complement and further building uplifts already robust base of over 500 mental health professionals.

We're also seeing success in further expanding payer relationships ups.

Uplift broad arrangements covering over 100 million lives and over the past few months, we have signed additional new contracts, adding over 15 million lives.

Chuck Divita: Uplift brought arrangements covering over 100 million lives, and over the past few months, we have signed additional new contracts, adding over 15 million lives. We'll provide further updates on progress during the Q3 call. Our third strategic priority is international growth. Our international business now accounts for over 15% of our consolidated revenue, and we see continued growth potential. We already operate a robust international business in Integrated Care that has delivered steady, double-digit growth and is well positioned to meet diverse needs across countries, markets, and client segments, including leveraging our hospital and health system technologies to support public health systems in several countries. We continue to evaluate opportunities to increase our position across both existing and new geographies. Fourth, we're highly focused on operational excellence to consistently deliver for clients and to achieve our business and financial objectives.

We will provide further updates on progress during the third quarter call.

Our third strategic priority is international growth.

Our international business now accounts for over 15% of our consolidated revenue and we see continued growth potential.

We already operate a robust international business and integrated care that is delivered steady double digit growth and is well positioned to meet diverse needs across countries markets and client segments, including leveraging our hospital and health system technologies to support public health systems in several countries.

We continue to evaluate opportunities to increase our position across both existing and new geographies.

Fourth we're highly focused on operational excellence to consistently deliver for clients and to achieve our business and financial objectives.

We've made considerable progress in driving operational excellence, including our highly successful client implementation season for 2025 coming off of a very challenging one and 2020 for.

Chuck Divita: We've made considerable progress in driving operational excellence, including a highly successful client implementation season for 2025, coming off of a very challenging one in 2024. This was also a key priority when I joined. With respect to cost efficiency, as noted last quarter, we're tracking modestly ahead of our cost savings and productivity targets. We've made meaningful progress across several areas, including technology and development, administrative costs, and Stock-Based Compensation, and we'll continue to make progress while balancing the need to invest in our strategic priorities. In closing, I'm encouraged by our first half performance... We're making progress against each of our key strategic priorities, and our teams continue to operate with focus, urgency, and discipline. We're committed to maintaining a balanced approach by delivering solid financial performance and investing in the products and capabilities important to our future.

This was also a key priority when I joined.

With respect to cost efficiency as noted last quarter, we're tracking modestly ahead of our cost savings and productivity targets.

We've made meaningful progress across several areas, including technology and development administrative costs and stock based compensation.

And we'll continue to make progress while balancing the need to invest in our strategic priorities.

In closing I am encouraged by our first half performance.

We're making progress against each of our key strategic priorities and our teams continue to operate with focused urgency and discipline.

We're committed to maintaining a balanced approach by delivering solid financial performance and investing in the products and capabilities are important to our future.

While broader market dynamics continued impact healthcare in the operating environment I remain confident in our strategy and our ability to return the company to an overall growth trajectory over time, including through the initiatives I've outlined with that I'll turn it over to model.

Chuck Divita: While broader market dynamics continue to impact healthcare and the operating environment, I remain confident in our strategy and our ability to return the company to an overall growth trajectory over time, including through the initiatives I have outlined. With that, I'll turn it over to Mala.

Thank you Chuck and good afternoon, everyone.

Mala Murthy: Thank you, Chuck, and good afternoon, everyone. Q2 consolidated revenue was $631.9 million, near the high end of the guidance range and down 1.6% year-over-year, driven by a decline at BetterHelp, offset to some extent by growth in Integrated Care revenues. Adjusted EBITDA of $69.3 million was also at the upper end of the guidance range and represented a margin of 11%. Net loss per share was $0.19, compared to a net loss per share of $4.92 in Q2 2024, which included $4.64 related to a pretax non-cash goodwill impairment charge.

Second quarter consolidated revenue was 631 9 million.

Near the high end of the guidance range and down one 6% year over year drill.

Driven by a decline at better health.

Offset to some extent by growth in integrated care revenue.

Adjusted EBITDA of $69 $3 million was also at the upper end of the guidance range and represented a margin of 11%.

Net loss per share was <unk> 19.

Compared to a net loss per share of $4 92 in the <unk>.

With the initiatives I have outlined.

Second quarter of 2024.

I'll turn it over to model.

Included a $4.64 related to a pre tax noncash goodwill impairment charge.

Thank you Chuck and good afternoon, everyone.

Second quarter consolidated revenue was 631 $9 million near the high end of the guidance range and down one 6% year over year drew.

Net loss per share in the second quarter of 2025 included amortization of intangibles of 50 cents per share pretax.

Mala Murthy: Net loss per share in Q2 2025 included amortization of intangibles of $0.50 per share pretax, and stock-based compensation expense of $0.13 per share pretax. These items were partially offset by a discrete tax benefit of $0.06 per share. Free Cash Flow was $61 million in the second quarter, slightly ahead of the prior year period. On a year-to-date basis, Free Cash Flow increased by $11 million compared to the same period last year. We ended the quarter with $618 million in cash and cash equivalents, after retiring $551 million in Convertible Senior Notes that matured during the quarter. Turning to our segment results.

Driven by a decline at better health.

Stock based compensation expense.

Offsets to some extent by growth in integrated care revenue.

<unk> per share pretax.

These items were partially offset.

Adjusted EBITDA of $69 $3 million was also at the upper end of the guidance range and represented a margin of 11%.

Greek tax benefit.

I appreciate it.

Free cash flow was $61 million in the second quarter slightly ahead of the prior year period.

Net loss per share was <unk> 19 cents compared to a net loss per share of $4.92 in the second quarter of 'twenty 'twenty four books.

On a year to date basis free cash flow increased $11 million compared to the same period last year.

She included a $4.64 related to a pretax noncash goodwill impairment charge.

We ended the quarter with six.

And $18 million in cash and cash equivalents.

After retiring $551 million in convertible senior notes.

Net loss per share in the second quarter of 2025 included amortization of intangibles of 50 cents per share pretax.

During the quarter.

Turning to our segment results.

Stock based comp.

Okay.

Integrated care segment revenue of 391 5 million.

Okay.

Mala Murthy: Integrated Care segment revenue of $391.5 million increased 3.7% over the prior year period and exceeded the high end of our guidance range. We saw good growth in visit revenue and continued strong performance in our international business, which again delivered mid-teens growth on a constant currency basis. Catapult contributed approximately 240 basis points to segment growth. Foreign exchange also contributed roughly 50 basis points to growth in the quarter. Underlying fundamentals continue to trend favorably. US Integrated Care segment membership at quarter end was 102.4 million members, towards the high end of our guidance range and up 11% year-over-year, while US Integrated Care virtual visit volume increased by 6% versus the prior year period.

Yeah.

Okay.

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Increase.

Three 7% over the prior year period.

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We saw good growth in visit revenue and continued strong performance in our international business, which delivered mid teens growth.

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Catapult contributed approximately 240 basis points.

Foreign exchange also contributed roughly 50 basis points to growth in the quarter.

Underlying fundamentals continue to trend favorably.

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U S integrated care segment membership at quarter end was 102 4 million member.

Towards the high end of our guidance range and up 11% year over year.

While U S integrated care virtual visit volume increased by 6% versus the prior year period.

We saw good growth in visits revenue and continued strong performance in our international business, which again delivered mid teens growth constant currency basis.

On a tab program enrollment at quarter end was 112 million down versus the fourth quarter due to the previously discussed contract law.

Mala Murthy: Chronic Care Program enrollment at quarter end was 1.12 million, down versus the Q1 due to the previously discussed contract loss. Excluding the impact of this loss, underlying program enrollment would have increased by a low single-digit percentage on a sequential basis. Q2 Integrated Care Adjusted EBITDA was $57.5 million, which represented a margin of 14.7% and was at the high end of our guidance range. This benefited from revenue flow-through, which was partially offset by higher OpEx in the quarter, including marketing spend and legal fees.

Catapult contributed approximately 240 basis points to seven.

Excluding the impact of this loss.

Foreign exchange also contributed roughly 50 basis points to growth in the quarter.

Underlying program enrollment would have increase by a low single digit percentage on a sequential basis.

Underlying fundamentals continue to trend.

Second quarter integrated care adjusted EBITDA was $57 5 million, which represented a margin of 14, 7% and was at the high end of our guidance range.

Yeah.

Okay.

[noise] well you asked integrated care virtual visit volume increased by 6% versus the prior year period.

This benefited from revenue flow through which was partially offset by higher opex in the quarter, including marketing spend and legal team.

On a care program enrollment at quarter end was 1.12 million down versus the first quarter due to the previously discussed contract law.

While this compares to an adjusted EBITDA margin of 17% in the prior year period.

Mala Murthy: While this compares to an Adjusted EBITDA margin of 17% in the prior year period, recall that we had cited a roughly 340 basis point tailwind to Adjusted EBITDA margins in Q2 2024 from performance-based revenue, variable compensation costs, and the timing of certain marketing and other operating expenses. Moving to the BetterHelp segment. Q2 revenue was $240.4 million, up slightly sequentially and just above the midpoint of our guidance range. Foreign exchange contributed approximately 45 basis points to year-over-year growth, while Uplift contributed roughly 100 basis points. Q2 average paying users declined by roughly 9,000 sequentially to 388,000, and were 5% lower versus Q2 2024.

Recall that we had cited a roughly 340 basis point tailwind to adjusted EBITDA margin in the second quarter of 2024 from performance based revenue variable compensation costs, and the timing of certain marketing and other operating expenses.

Excluding the impact of this law.

Underlying program enrollment would have increase by a low single digit percentage on a sequential basis.

Second quarter.

Moving to the better health segment.

Second quarter revenue was $244 million.

today.

Operator: All lines will be muted during the presentation portion of the call with an opportunity for questions and answers at the end. If you would like to ask a question, please press star followed by one on your telephone keypad.

Percent and was at the high end of our guidance range.

Up slightly sequentially and just above the midpoint of our guidance range.

This benefited from revenue flow through which was partially offset by higher opex in the quarter, including marketing spend and legal team.

Foreign exchange contributed approximately 45 basis points to year over year growth.

Michael Minchak: I would now like to pass the conference over to Mike Minchak, Head of Investor Relations for Teladoc Health. Thank you. You may proceed. Thank you and good afternoon.

While uplift contributed roughly 100 basis points.

While this compares to an adjusted EBITDA margin of 17% in the prior year period.

Second quarter average paying users declined by roughly 9000 sequentially to 388000 and were 5% lower versus the second quarter of 2024.

Michael Minchak: Today after the market close, we issued a press release announcing our second quarter 2025 financial results. This press release and the accompanying slide presentation are available in the investor relations section of the TeladocHealth.com website.

Call that we had cited a roughly 340 basis point tailwind to adjusted EBITDA margin in the second quarter of 'twenty 'twenty four from performance based revenue variable compensation costs, and the timing of certain marketing and other operating expenses.

Michael Minchak: On this call to discuss our results are Chuck Divita, Chief Executive Officer, and Mala Murthy, Chief Financial Officer. During this call, we will also discuss our outlook and our prepared remarks will be followed by a question and answer session. Please note that we will be discussing certain non-GAAP financial measures that we believe are important in evaluating our performance. Details on the relationship between these non-GAAP measures to the most comparable GAAP measures and reconciliations thereof can be found in the press release that is posted on our website.

Despite the encouraging early progress on our insurance and international initiatives.

Mala Murthy: Despite encouraging early progress on our insurance and international initiatives, we continue to see headwinds in the underlying US cash pay business. While the year-over-year decline has moderated relative to 2024 levels, US cash pay users saw a high single-digit percentage decline versus Q2 2024. Last quarter, we pointed to a slight uptick in churn rates, which we believe was reflective of softening consumer sentiment and uncertainty around the macro environment. That trend continued through Q2, while we also saw an increase in customer acquisition costs and fewer growth user adds. We believe these factors and consumer interest in accessing therapy through insurance coverage is impacting the cash pay business. We believe that validates our insurance acceptance initiative with Uplift meaningfully accelerating our effort.

We continue to see headwinds in the underlying U S cash pay business.

Moving to the better health segment.

Second quarter revenue was $244 million up slightly sequentially and just above the midpoint of our guidance range.

While the year over year decline has moderated relative to 2024 level.

Cash pay users for a high single digit percentage decline versus the second quarter of 2024.

Foreign exchange contributed approximately 45 basis points to year over year growth.

Michael Minchak: Also, please note that certain statements made during this call will be forward-looking statements as defined by the Private Securities Litigation Reform Act of 1995. Such forward-looking statements are subject to risks, uncertainties, and other factors that could cause our actual results to differ materially from those expressed or implied on this call. For additional information, please refer to our cautionary statement in our press release and our filings with the SEC, all of which are available on our website.

Last quarter, we pointed to a slight uptick in churn rate, which.

While uplift contribution of roughly 100 basis points.

Which we believe was reflective of softening consumer sentiment and uncertainty around the macro environment.

Second quarter average paying users declined by roughly 90000 sequentially to 388000 and were 5% lower versus the second quarter of 'twenty 'twenty four.

That trend continued through the second quarter.

While we also saw an increase in customer acquisition costs and fuel our growth user ads.

Despite the encouraging early progress on our insurance and international initiatives.

We believe these factors and consumer interest in accessing therapy to insurance coverage is impacting the cash payments.

Chuck Divita: I would now like to turn the call over to Chuck. Thanks, Mike. I'm pleased with our strong performance in the second quarter with consolidated revenue and adjusted EBITDA, both at the higher end of our guidance. This reflects continued discipline execution and builds on our solid results from the first quarter.

We continue to see headwinds in the underlying U S cash pay business.

We believe that validate our insurance acceptance initiatives with uplift meaningfully accelerating our effort.

While the year over year decline has moderated relative to 'twenty 'twenty four level.

Sure.

We continue to believe the unification of timber acquisition funnel between cash gain insurance coverage.

Chuck Divita: Based on our results and outlook for the second half of the year, we're narrowing our guidance range in 2025, consolidated revenue, and adjusted EBITDA.

Okay.

Mala Murthy: We continue to believe the unification of customer acquisition funnel between cash pay and insurance coverage will allow us to more effectively leverage BetterHelp's advertising and marketing budget, and lead to a lower acquisition cost per user over time. While not enough to offset the headwinds in the US cash pay business, international users were up by a high single-digit percentage over Q2 2024. With more attractive customer acquisition costs, we plan to continue reallocating advertising spend to those markets. While still early, our localized launches continue to see good month-over-month growth in users, and we are evaluating opportunities for additional localized market launches over the balance of 2025.

Sure.

Okay.

Yeah.

Allow us to more effectively leverage better health advertising and marketing budget.

Okay.

Chuck Divita: Mala will provide more details on our performance and outlook later in the call.

Okay.

[noise].

And lead to a lower acquisition cost per user over time.

Chuck Divita: It's now been a year since I joined Teladoc Health and I would like to take the opportunity to comment on the progress we've made and the direction of the company. It's been a transformative year in many respects, as we've worked with urgency and purpose to improve performance and reposition the business. As I shared when I first joined, I saw the need to strengthen our market focus and increase the efficiency of our business. and we've taken decisive actions that have resulted in a more streamlined organization with greater agility and market orientation and a more efficient and scalable cost structure.

While not enough to offset the headwinds in the U S cash paid business.

International users up by a high single digit percentage over the second quarter of 2024.

With more attractive customer acquisition cost.

Okay.

Yes.

[noise] [noise].

We plan to continue reallocating advertising spend to those market.

While still early our localized launches continue to see good month over month growth in users.

And we are evaluating opportunities for additional localized market launches over the balance of 2025.

Chuck Divita: I also shared the importance of accelerating innovation across our products and capabilities. We've made considerable progress in that regard, including a product innovation pipeline that's gaining momentum.

Okay.

Insurance revenue totaled $2 4 million for the quarter, which was in line with expectation and attributable to outlets.

[noise] [noise] by a high single digit.

Mala Murthy: Insurance revenue totaled $2.4 million for the quarter, which was in line with expectations and attributable to Uplift, as we continue to build out the operating infrastructure to support the future scaling of our BetterHelp insurance business. BetterHelp Adjusted EBITDA was $11.9 million in Q2. Adjusted EBITDA margin of 4.9% was in the upper half of our guidance range of 2.5% to 5.25%. The margin declines on a year-over-year basis was mainly due to lower revenue and incremental investments to advance the insurance initiative. Turning to guidance.

Chuck Divita: Let me share some examples.

Chuck Divita: We recently launched Wellbound, a new employee assistance program offering for the U.S. integrated care market. It provides mental health and well-being support, including access to online therapy services from BetterHelp and seamless access to other available Teladoc services. While early, we're pleased with the level of interest we're seeing and we look forward to building a position in the EAP market.

As we continue to build out of the operating infrastructure to support the future scaling better health insurance.

Better help adjusted EBITDA was $11 9 million in the second quarter.

Message over the second quarter of 'twenty 'twenty four.

With more attractive customer acquisition call.

Adjusted EBITDA margin of four 9% was in the upper half of our guidance range of two 5% to five 5%.

We plan to continue reallocating advertising spend to those markets.

Chuck Divita: We're enhancing our cardiometabolic health program this year, including new connected devices, as well as registered dietician access, sleep support, and other new features. And to further engage and support enrollees with rising risk and higher acuity conditions, we're developing additional clinical interventions leveraging our primary care specialist and care support team. We believe that a comprehensive approach focused on both prevention and the progression of diabetes, hypertension, and obesity will have the greatest sustained impact on patient health and value for our clients.

While it's still early our localized launches continue to see good month over month growth in users.

The margin declines on a year over year basis was mainly due to lower revenue and incremental investments to advance the insurance initiatives.

And we are evaluating opportunities for additional localized market launches over the balance of 'twenty 'twenty five.

Sure.

Turning to guidance.

We now expect 2025 consolidated revenue.

Insurance revenue totaled $2 $4 million for the quarter, which was in line with expectation.

Mala Murthy: We now expect 2025 consolidated revenue of $2.501 billion to $2.548 billion, with the midpoint increasing slightly versus our prior range, with an increase in integrated care outpacing a lower Better Health outlook. Adjusted EBITDA is expected to be in the range of $263 million to $294 million. The midpoint of this range is slightly below the previous outlook, impacted by similar segment dynamics and now incorporating the anticipated impact of tariffs, which I will speak about momentarily. Full-year free cash flow guidance of $170 million to $200 million remains unchanged.

250 1 billion.

254 $8 billion.

Yeah.

Oh.

[noise] [noise].

But the midpoint, increasing slightly versus our prior range.

With that increase in integrated care outpacing in lower better health outlook.

Chuck Divita: For our hospital and health system clients, we launched a new AI-enabled virtual Sitter solution fully integrated into our proprietary technology. This new offering extends and supports our clients' workforce capacity and their care delivery and patient safety objectives, including matters such as fall risk and patient loathing.

Adjusted EBITDA is expected to be in the range of $263 million to $294 million.

[laughter].

The midpoint of this range is slightly below the previous outlook impacted by similar segment dynamics and now incorporating the anticipated impact of tariffs, which I will speak about momentarily.

[noise] incremental investments to advance the insurance initiative.

Chuck Divita: In our international integrated care business, we also continue to add new solutions, including hybrid care models for public health systems to support a variety of needs, including access to primary care and emergency department care in rural and remote communities. Product innovation will be an ongoing focus of our organization. Over the past year, we've also added important capabilities, including through strategic acquisition. Catapult Health strengthens our approach to preventative care through its virtual checkup and other solutions, as well as being an important and complimentary engagement capability with other Teladoc services.

Turning to guidance.

We now expect 2025 consolidated revenue.

Full year free cash flow guidance of $117 million due to a $100 million remains unchanged.

Oh $2.501 billion to 2.5 or $8 billion.

We now expect 2025 stock based compensation expense in the range of $95 million to $105 million.

Mala Murthy: We now expect 2025 stock-based compensation expense in the range of $95 to 105 million, approximately $10 million below our prior outlook, and a continued area of focus for us. For Q3, we expect consolidated revenue in the range of $614 to 636 million, and adjusted EBITDA in the range of $56 to 70 million. Drilling down into the segments, starting with Integrated Care, we are raising and narrowing our full year 2025 revenue guidance, which we now expect to be up 1.75% to 3.25% year-over-year, versus our prior guidance of flat to up 3%.

But the midpoint, increasing slightly versus our prior range.

Would that increase in integrated care.

Proximately $10 million below our prior outlook and a continued area of focus for us.

Sing a long better health outlook.

Yeah, I said EBITDA is expected to be in the range of $263 million to do $194 million.

Chuck Divita: And we recently acquired Uplift to support Better Helps entry into insurance, an important initiative I also shared when I joined the company.

For the third quarter, we expect consolidated revenue in the range of $614 million to $636 million.

Chuck Divita: I'll provide an update on our progress in this area in a moment. Additionally, we've strengthened operational execution, added new partnerships and collaborations, and made advancements in our technological infrastructure. All aimed at supporting our strategic priorities and our ability to deliver more services and value to customers.

The midpoint of this range is slightly below the previous outlook.

And adjusted EBITDA in the range of $56 million and $17 million.

By similar segment dynamics, and now incorporating the anticipated impact of tariffs, which I will speak about momentarily.

Drilling down into the segments, starting with integrated care.

Are raising and narrowing our full year 2025 revenue item.

Full year free cash flow guidance of $117 million to $200 million remains unchanged.

Which we now expect to be up 175% to three points to 5% year over year.

Chuck Divita: We've also hit some noteworthy milestones, including exceeding 100 million U.S. integrated care members, providing additional opportunities to grow our services over time. While there is important work ahead, I'm pleased with the progress overall, and I'm confident we're in a stronger position to execute in an evolving market. As we've all seen, the health care challenges are substantial. affordability and rising costs, the impact of disease and chronic conditions, unmet mental health needs, provider pressures, and other issues continue to impact all stakeholders. And it's clear to us that virtual care can and must play a greater role going forward given the extent and magnitude of these challenges.

We now expect 2025 stock based compensation expense in the range of $95 million to $105 million approximately $10 million below our prior outlook and a continued area of focus for us.

Our prior guidance.

Flat to up 3%.

The increase of 100 basis points at the midpoint reflects our strong first half performance relative to guidance.

Mala Murthy: The increase of 100 basis points at the midpoint reflects our strong first half performance relative to guidance, coupled with updated assumptions on foreign exchange. We continue to expect Catapult to contribute approximately 200 basis points to full-year revenue growth. We are narrowing our full-year 2025 Adjusted EBITDA margin guidance to 14.5% to 15.25% versus our prior range of 14.3% to 15.3%, which is up slightly at the midpoint. As previously discussed, this includes a roughly 40 basis point headwind from the Catapult acquisition. Excluding Catapult dilution, Adjusted EBITDA margin would be up slightly year-over-year at the midpoint of the guidance range. Our guidance of 101 million to 103 million US Integrated Care members remains unchanged.

Coupled with updated assumptions on foreign exchange.

For the third quarter, we expect consolidated revenue in the range of $614 million to $636 million.

We continue to expect to contribute approximately 200 basis points to full year revenue growth.

And adjusted EBITDA in the range of $56 million and $17 million.

We are narrowing our full year 2025, adjusted EBITDA margin guidance to 14, 5%.

Drilling down into the segments, starting with integrated care.

Two 5% versus our prior range of 14, 3% to 15, 3%.

We are raising and narrowing our full year 2025 revenue budget, which.

Which we now expect to be up 1.75% to 3.25% year over year.

It was up slightly at the midpoint.

As previously discussed this includes a roughly 40 basis point headwind from the catapult acquisition excluding.

Versus our prior guidance of flat to up 3%.

Excluding can have full dilution.

The increase of 100 basis points at the midpoint reflects our strong first half performance relative to guidance cut.

Adjusted EBITDA margin would be up slightly year over year at the midpoint of the guidance range.

Our guidance of $101 million to $103 million U S integrated care member remain unchanged.

Coupled with updated assumptions on foreign exchange.

We continue to expect to contribute approximately 200 basis points to full year revenue growth.

Last quarter, we provided a preliminary view on the potential impact of tariffs.

Mala Murthy: Last quarter, we provided a preliminary view on the potential impact of tariffs. The initial estimate we provided, which was not included in our prior guidance, given the fluidity of the situation, was based on proposed rates at the time, including a 145% China tariff and the impact of our mitigation efforts. Based on the latest information, we now estimate an unfavorable Adjusted EBITDA impact in 2025 of approximately $3 million, which is now included in our guidance ranges. This reflects a partial year of impact based on the timing of new rates and inventory on hand. We continue to evaluate additional levers to mitigate the impact of tariffs now and into the future. This includes assessing alternative sourcing arrangements to diversify our supply chain, which we think is a prudent long-term action.

We are narrowing our full year 'twenty 25, adjusted EBITDA margin guidance to 14, 5% to 15.25% versus our prior range of 14, 3% to 15, 3%, which is up slightly at the midpoint.

Chuck Divita: across patients, providers, platforms, and partners, all aimed at enhancing the patient experience, improving outcomes, and delivering greater value. We're uniquely positioned to advance this important work, and we're prioritizing investments that are aligned with this vision.

The initial estimate we provided which was not included in our prior guidance given the fluidity of the situation was based on proposed rate at the time, including 845%, China tariff and the impact of our mitigation efforts.

Chuck Divita: and we plan to deliver on it through our four strategic priorities. First, we're enhancing our integrated care offerings, particularly in the U.S., to drive a greater impact on both clinical outcomes and the cost equation. We'll support our growth objectives through continued product innovation and we intend to launch new and enhanced offerings across our portfolio on a sustained basis. are leveraging our millions of engagement points in new and unique ways. In advancing clinical intervention opportunities and orchestrating care more holistically, we intend to deliver greater value for clients and the people we serve. Second, we're further leveraging our skilled mental health position.

Just on the latest information we now estimate.

As previously discussed this includes a roughly 40 basis points.

Favorable adjusted EBITDA impact in 2025.

Yeah.

Approximately $3 million.

Okay.

Which is now included in our guidance ranges.

[noise] [noise].

This reflects a partial Europe impact based on the timing of new rates and inventory on hand.

We continue to evaluate additional levers to mitigate the impact of tariffs now and into the future.

This includes assessing alternative sourcing arrangements to diversify our supply chain.

Yeah.

Not included in our guidance given the fluidity of the situation was based on proposed rate at the time, including 845%, China tariffs and the impact of our mitigation efforts.

Which we think is a prudent long term action.

For the third quarter.

Chuck Divita: In addition to new products such as Wellbound, we have several initiatives underway to expand mental health access and our ability to serve more needs. This includes momentum in integrated care, where we saw a 13% year-over-year increase in mental health visits in the U.S. during the second quarter. And in better health, where we'll be building on our unparalleled consumer position by adding insurance capabilities to grow and expand our market opportunities.

We expect integrated care segment revenue growth to be down <unk>, 5% to up two 5% and adjusted EBITDA margin in the range of 14% and 16, 5%.

Mala Murthy: For the third quarter, we expect Integrated Care segment revenue growth to be down 0.5% to up 2.25%, and Adjusted EBITDA margin in the range of 14% and 16.5%. Recall that the third quarter of 2024 had included a favorable resolution of a prior period billing adjustment, which will drive a roughly 115 basis points headwind to revenue growth and roughly 95 basis points headwind to Adjusted EBITDA margin in the third quarter of 2025. Importantly, we assume a return to sequential growth in Chronic Care Program Enrollment in the third quarter, driven in part by continued growth in our weight management program, which was augmented by the addition of one of our largest customers at the start of 2025.

Just on the latest information, we now estimate an unfavorable.

Recall that the third quarter of 2024 had included a favorable resolution of a prior period billing adjustment, which will drive a roughly 115 basis point headwind to revenue growth and roughly 95 basis point headwind to adjusted EBITDA Mark.

Chuck Divita: On that front, I would like to take a moment to provide an update on BetterHelp's insurance coverage initiative. As we've shared, we believe insurance will leverage better help strong consumer activation, experience, and scale while having a positive impact on conversion rates, the number of user sessions, and return on advertising spend over time. With ongoing headwinds in the consumer cash pay business, we see insurance coverage as essential to the stability and growth outlook for better health. and we believe we can meaningfully scale insurance over time. We are being methodical in our approach to ensure the long-term success of this business.

In the third quarter of 2025.

Importantly, we assume a return to sequential growth in chronic care program enrollment in the third quarter driven in part by continued growth in our weight management program.

Each was augmented by the addition of one of our largest customers.

From 2025.

Regarding the second half cadence.

Mala Murthy: Regarding the second half cadence, our updated guidance implies a sequential step-up in revenue in Q4, driven largely by typical seasonality related to infectious disease business, as well as contribution from new business implementations. It also implies a sequential increase in Adjusted EBITDA dollars, driven by the revenue increase, coupled with disciplined cost control. Moving to BetterHelp. We are narrowing our revenue guidance range with a revised midpoint reflecting ongoing headwinds in our US cash pay business. Although still in the early stages, we are encouraged by the progress of our insurance initiative, which we view as a critical driver for restoring long-term growth in the BetterHelp business. We now expect a year-over-year revenue decline of 6.8% to 9.2% in 2025, compared to our prior outlook of a 3.75% to 9.75% increase.

Our updated guidance implies a sequential step up in revenue in the fourth quarter, driven largely by typical seasonality related to infectious diseases as well as contribution from new business implementations.

It also implies a sequential increase in adjusted EBITDA dollars driven by the revenue increase coupled with disciplined cost control.

Moving to better health.

We are narrowing our revenue guidance range with the revised midpoint, reflecting ongoing headwinds in our U S cash pay business.

Chuck Divita: In late June, we began a soft launch of Better Health Insurance in a single state, laying the groundwork for a methodical ramp of the business over the next several quarters. We're encouraged by the early results, including the performance of our technology, the strength, reliability, and durability of the insurance processes, and growth of the insurance provider network. we see significant opportunities to access and leverage BetterHelp's expansive network of 35,000 therapists to support growth in the insurance network. As a reminder, BetterHelp's therapists are all fully licensed and with a master's degree or higher. The network averages eight years of experience and consistently delivers results, including over 70 percent of patients reporting symptom reduction within 12 weeks.

Although still in the early stages.

We're encouraged by the progress our insurance initiative, which we view as a critical driver for restoring long term growth and to better help us.

We now expect a year over year revenue decline of six 8% to nine 2% in 2025.

Compared to our prior outlook of 375% to 975% increase.

Our guidance continues to reflect approximately $10 million in insurance revenue for 2025 net of any mix shift from the existing cash pay business.

Mala Murthy: Our guidance continues to reflect approximately $10 million in insurance revenue for 2025, net of any mix shifts from the existing cash pay business. We expect a more meaningful revenue contribution in 2026 as we continue to methodically scale operations and expand our payer therapist network over the next 6 to 12 months, while steadily enabling access across additional states. We now expect a BetterHelp Adjusted EBITDA margin of 4% to 5.5% for the full year, with the midpoint down 75 basis points versus our prior guidance. This revision primarily reflects the flow-through impact of a lower revenue outlook, partially offset by incremental G&A reductions as we continue to prioritize investments that support the growth of our insurance initiative. We remain focused on balancing top-line growth with bottom-line discipline.

We expect a more meaningful revenue contribution in 2026, and we continue to methodically scale operation and expand our bed therapist network over the next six to 12 months.

Chuck Divita: as well as high satisfaction rates, including over 80 percent of patients that would recommend their therapist to others. In this regard, we've begun an initial outreach to many of our better health therapists to join the insurance network, and we're seeing good interest. To date, over 2,000 have engaged and are now in various stages of the credentialing process. This outreach will continue as we look to complement and further build on Uplift's already robust base of over 1,500 mental health professionals. We're also seeing success in further expanding payer relations. Uplift brought arrangements covering over 100 million lives, and over the past few months, we have signed additional new contracts adding over 15 million.

Was that any enabling access across additional days.

We now expect a better health adjusted EBITDA margin of 4% to five 5% for the full year.

With the midpoint down 75 basis points versus our prior guidance.

This revision primarily reflects the flow through impact of lower revenue outlook, partially offset by incremental G&A reductions as we continue to prioritize investments that support the growth of our insurance solutions.

Chuck Divita: will provide further updates on progress during the third quarter call.

We remain focused on balancing top line growth with bottom line discipline.

Chuck Divita: Our third strategic priority is international growth. Our international business now accounts for over 15% of our consolidated revenue and we see continued growth potential. We already operate a robust international business in integrated care that has delivered steady double-digit growth and is well positioned to meet diverse needs across countries, markets and client segments, including leveraging our hospital and health system technologies to support public health systems in several countries. We continue to evaluate opportunities to increase our position across both existing and new geographies.

While we will not pursue inefficient customer acquisition, we are committed to maintaining strong profit to better health in preparation for the broader insurance Rona.

Mala Murthy: While we will not pursue inefficient customer acquisition, we are committed to maintaining strong traffic to BetterHelp in preparation for the broader insurance rollout. For the third quarter, we are guiding to BetterHelp segment revenue down 5% to 9.75% year-over-year, and an Adjusted EBITDA margin of 1% to 3.75%, reflecting the early investment phase of scaling our insurance initiative. Lastly, our balance sheet remains strong. We retired $551 million in Convertible Senior Notes that came due in Q2 with cash on hand. The $1 billion Convertible Note maturing in June 2027 is our only remaining debt outstanding. We remain comfortable with our leverage as Net Debt to Trailing Adjusted EBITDA stood at 1.1x at quarter end.

For the third quarter, we are guiding to better health segment revenue down 5% to 975% year over year.

And an adjusted EBITDA margin of 1% to 375%, reflecting the early investment phase of scaling our insurance initiatives.

Lastly, our balance sheet remains strong.

Chuck Divita: Fourth, we're highly focused on operational excellence to consistently deliver for clients and to achieve our business and financial objectives. We've made considerable progress in driving operational excellence, including a highly successful client implementation season for 2025, coming off of a very challenging one in 2024. This was also a key priority when I started. With respect to cost efficiency, as noted last quarter, we're tracking modestly ahead of our cost savings and productivity targets. We've made meaningful progress across several areas, including technology and development, administrative costs, and stock-based compensation. and will continue to make progress while balancing the need to invest in our strategic priorities.

We retired $551 million in convertible senior notes that came due in the second quarter with cash on hand.

The $1 billion convertible note maturing in June 2027 is our only remaining debt outstanding.

We remain comfortable with our leverage as net debt to trailing adjusted EBITDA stood at one one times at quarter end.

We continue to believe our strong cash balance cash flow generation and business position provides us with optionality in the future.

Mala Murthy: We continue to believe our strong cash balance, capital generation, and business position provides us with optionality in the future. Separately, in mid-July, we entered into a new $300 million revolving credit facility, which enhances our financial and operational flexibility. At the current time, there is nothing drawn on the facility, and we have no immediate plans to use it. Our capital allocation priorities remain unchanged. First, we look to maintain a strong balance sheet and an appropriate net leverage profile. Second, we will invest in the business to support our strategy through both organic and inorganic initiatives. And third, we will evaluate share repurchases as a potential use of cash. With that, let me turn the call back to Chuck.

Separately in mid July we entered into a new $300 million revolving credit facility, which enhances our financial and operational flexibility.

Chuck Divita: In closing, I'm encouraged by our first half performance. We're making progress against each of our key strategic priorities, and our teams continue to operate with focus, urgency, and discipline. We're committed to maintaining a balanced approach by delivering solid financial performance and investing in the products and capabilities important to our future. While broader market dynamics continue to impact health care and the operating environment, I remain confident in our strategy and our ability to return the company to an overall growth trajectory over time, including through the initiatives I have outlined.

At the current time, there is nothing drawn on the facility and we have no immediate plans to use it.

Our capital allocation priorities remain unchanged first we look to maintain a strong balance sheet and an appropriate net leverage profile.

We will invest in the business to support our strategy to both organic and inorganic initiatives and third we will evaluate share repurchases as a potential use of cash.

Mala Murthy: With that, I'll turn it over to Mala. Thank you, Chuck, and good afternoon, everyone. Second quarter consolidated revenue was $631.9 million, near the high end of the guidance range and down 1.6% year over year, driven by a decline at better health, offset to some extent by growth in integrated care revenue. Adjasted EBITDA of $69.3 million was also at the upper end of the guidance range and represented a margin of $11 billion. Net loss per share was $0.19 compared to a net loss per share of $4.92 in the second quarter of 2024, which included a $4.64 related to a pre-tax, non-cash goodwill impairment.

That let me turn the call back to Chuck.

Thanks model.

We continue to believe that virtual care could be a performance multiplier within the health care ecosystem, helping to address key challenges and that Teladoc health is well positioned to play a key role in doing so.

Chuck Divita: Thanks, Mala. We continue to believe that virtual care could be a performance multiplier within the healthcare ecosystem, helping to address key challenges, and that Teladoc Health is well positioned to play a key role in doing so. Just last week, we hosted our annual Teladoc Health Forum event in Nashville, which brought together healthcare thought leaders, virtual care advocates, and innovators from across the globe to share their experiences, exchange perspectives, discuss strategies, and offer insights into the further advancement of virtual care. And spending time with many of our clients and partners in attendance, I was encouraged with the level of interest in deepening our partnerships and further collaborating to help them achieve their goals now and into the future. With that, we'll open it up for your questions. Operator?

Just last week, we hosted our annual Teladoc Health Forum event in Nashville, which brought together health care thought leaders virtual care advocates and innovators from across the globe to share their experiences exchange perspectives discuss strategies and offers insights into the further advancement of virtual care.

And spending time with many of our clients and partners in attendance.

Encouraged with the level of interest and deepening our partnerships and further collaborating to help them achieve their goals now and into the future.

With that we'll open it up for your questions operator.

Of course, we will now begin the question and answer session. We kindly ask that all participants limit themselves to one question.

Operator: Of course. We will now begin the question-and-answer session. We kindly ask that all participants limit themselves to one question. If you'd like to ask a question, please press star followed by one on your telephone keypad. If for any reason you'd like to remove that question, please press star followed by two. Again, to ask a question, press star one. As a reminder, if you are using a speakerphone, please remember to pick up your handset before asking a question. Our first question comes from the line of David Roman with Goldman Sachs. Your line is now open.

Mala Murthy: Net loss per share in the second quarter of 2025 included amortization of intangibles of $0.50 per share pre-tax. at stock-based compensation expense of $0.13 per share pre-tax. These items were partially offset by a discrete tax benefit. $0.06 per share. Pre-cash flow was $61 million in the second quarter, slightly ahead of the prior year period. On a year-to-date basis, free cash flow increased by $11 million compared to the same period last year. We ended the quarter with $618 million in cash and cashing.

If you'd like to ask a question. Please press star followed by one on your telephone keypad.

Any reason that you'd like to remove that question. Please press star followed by two again to ask a question press Star one.

Reminder, if you're using a speaker phone. Please remember to pick up your handset before asking a question.

Our first question comes from the line of David Roman with Goldman Sachs.

Your line is now open.

Okay.

Thank you good afternoon, and good afternoon everybody.

David Roman: Thank you. Good afternoon. Good afternoon, everybody. A lot of moving parts here, so I'll try to make sure I limit it here to one question. I guess, you've talked about over the past year, Chuck, the transition away from a subscription model to a pay per visit or pay per use model, that does to some extent obfuscate the underlying performance of the business. And I know you went through a few metrics on the call, but maybe you could unpack a little bit, what's going on there and where we are in that transition. If you can give us a sense of, is that a 2025 event? Does that extend into 2026? And how you're thinking about measuring success in that initiative.

Right.

Lot of moving parts here, so I'll try to make sure are limited to one question I guess, you've talked about over the over the past year, Chuck the transition away from a subscription model to a pay per visit or pay per use model that that does to some extent does to some extent obvious gate the underlying performance of the business and I know you went through a few metrics.

Mala Murthy: after retiring $551 million in convertible senior notes at the door during the Turning to our segment. Integrated care segment revenue of $391.5 million increased 3.7% over the prior year period and exceeded the high end of our guidance We saw good growth in VisitRev. and continued strong performance in our international business which has been delivered mid-teens growth on constant currency basis. Catapult contributed approximately 240 basis points to settlement. Foreign exchange also contributed roughly 50 basis points to growth in the course. Underlying fundamentals continue to transceiver.

On the call, but maybe you could unpack a little bit.

What's going on there and where we are in that in that transition either if you can give us a sense of is that a 2025 event does that extend into 2026, and how youre thinking about measuring success in that initiative.

Yes, I appreciate the question.

Chuck Divita: Yeah, I appreciate the question. You know, this transition's been going on for a few years now in earnest because, you know, post-pandemic, obviously, with the broad adoption and maturity of the market, and that's continued. In 2025, we now are at a point where more than 50%, a majority of our revenues in virtual care are coming from visit-based arrangements versus subscription-based. So there's more room to go there, probably, but we've sort of reached a place where it's the majority. And it varies a little bit by product line. In mental health, we're now at about 70% that are visit-based. So you'll start to see over time, more of that underlying growth in visits, which is a good thing, and translate into revenue growth.

This transition has been going on for a few years now in earnest because youll post pandemic, obviously with the broad adoption and maturity of the market.

That has continued in 2025.

We now are at a point where.

More than 50% the majority of our revenues in virtual care are coming from visit based arrangements versus subscription base. So theres more room to go there probably but we sort of reached a place where it's the majority.

Varies a little bit by product line and mental health. We're now at about 70% that our visit base. So youll start to see over time more of that underlying growth in visits which is a good thing and translate into revenue growth, but we still got a little bit of a headwind from that subscription.

Mala Murthy: U.S. Integrated Care Segment Membership at Quarter End with 102.4 million members towards the high end of our guidance range and up 11% year-over-year.

Chuck Divita: But we still got a little bit of headwind from that subscription move.

Yeah.

Great. Thank you very much.

David Roman: Great. Thank you very much.

Mala Murthy: while U.S. integrated care virtual visit volume increased by 6% versus the prior year period. Chronic care program enrollment at quarter end was $1.12 million down versus the first quarter due to the previously discussed contract. Excluding the impact of this loss, underlying program enrollment would have increased by a low single-digit percentage on a sequential basis. Second Quarter Integrated Care Adjusted EBITDA was $57.5 million, which represented a margin of 14.7% and was at the high end of our guidance range. This benefited from revenue flow through, which was partially offset by higher OPEX in the quarter, including marketing spend and legal.

Yeah.

Thank you for your question.

Operator: Thank you for your question. Our next question comes from the line of Richard Close with Canaccord Genuity. Your line is now open.

Our next question comes from the line of Richard close with Canaccord Genuity.

Your line is now open.

Yes, thanks for the questions congratulations on the progress maybe on better health and insurance.

Richard Close: Yes, thanks for the questions. Congratulations on the progress. Maybe on BetterHelp and insurance. First, can you discuss, you know, how you see the margin difference between cash pay and insurance, I guess, longer term? And then second, you know, you launch-- I think you said launching insurance in one state, a soft launch. How are you thinking about the rollout going forward? Is that just a state-by-state basis?

First can you discuss how are you.

You see the margin difference between cash pay and insurance I guess longer term and then second.

You launch I think you said launching insurance in one state a soft launch how are you thinking about the rollout going forward is that just a state by state basis.

So thank you Richard for the question look on the margin for insurance.

Mala Murthy: Thank you, Richard, for the question. Look, on the margins for insurance, if you think about the legacy cash pay business in BetterHelp, we have always said that the gross margins for that business are, you know, in the range of overall Teladoc Health margins, right? It's always been around the high 60s, early 70s type of gross margin. Relative to that, you know, as we have thought about insurance, we recognize that it is going to be lower than that, those levels. You know, it's a little bit early for us to comment on exactly where it is going to reach equilibrium in the longer term, but, you know, there are enough public proxies out there that will tell you that it is a lot lower than those levels.

If you think about the legacy cash pay business in better health.

Mala Murthy: While this compares to an adjusted EBITDA margin of 17% in the prior year period, Recall that we had cited a roughly 340 basis point tailwind to adjust the EBITDA margins in the second quarter of 2024 from performance based revenue, variable compensation costs, and the timing of certain marketing and other operating moving to the better health set. Second quarter revenue was $240.4 million, up slightly sequentially, and just above the midpoint of our guidance. Foreign Exchange contributed approximately 45 basis points to Eurovision growth. while Uplift contributed roughly 100 billion. Second quarter average paying users declined by roughly 9,000 sequentially to 388,000 and were 5% lower versus the second quarter of 2024.

We have always said that the gross margins for that business.

Our.

In the range of overall Teladoc health margins right, it's always been around the high 16 17.

Margin.

Relative to that.

As we have thought about insurance, we recognize that it is going to be lower than that of those levels.

It's a little bit early for us to comment on exactly where it is going to reach equilibrium in the longer term.

But you know there are enough public proxies out there that will tell you that it is a lot lower than both level, having said that.

What we are.

Mala Murthy: Having said that, what we are, you know, what we are focused on is the fact that we have 4 million plus consumers coming at the top of the funnel, if you will. So, you know, the advertising spend that we have, the scale of it, attracts that scale of consumers seeking therapy. And we believed that offering the choice of insurance acceptance, side by side with cash pay, which is what is live on our platform now in one state, as we talked about, is going to allow for greater conversion than we have with just cash pay. So that is the investment thesis we have, that we will continue to make progress on, as we scale this initiative. Chuck?

What we are focused on is the fact that we have 4 million plus consumers coming at the top of the funnel if you will.

So the advertising spend that we have the scale of that.

Dropped that scale of consumers seeking therapy.

Mala Murthy: Despite encouraging early progress on our insurance and international initiatives, We continue to see headwinds in the underlying U.S.

And we believe that offering the choice of insurance acceptance.

Mala Murthy: tax havens. While the year-over-year decline has moderated relative to 2024 levels, U.S. cash pay users saw a high single-digit percentage decline versus the second quarter of 2024. Last quarter, we pointed to a slight uptick in churn rates, which we believe was reflective of softening consumer sentiment and uncertainty around the macro environment. That trend continued through the second quarter, while we also saw an increase in customer acquisition costs and fewer gross user ads. We believe these factors and consumer interest in accessing therapy through insurance coverage is impacting the cash payment. We believe this validates our insurance acceptance initiative with Uplift meaningfully accelerating our efforts.

Side by side with cash pay which is what is live on our platform now in one state as we talked about is going to allow for greater conversion than we have we just catch me so.

That is the investment thesis, we have that we will continue to make progress on.

We scale this initiatives, Chuck and I'll talk a bit about the rollout. So I guess I think of it this way supply and demand that we know the demand out there one unmet need to help me.

Chuck Divita: Yeah, and I'll talk a bit about the rollout. So I guess, think of it this way: supply and demand. We know the demand out there. One, the unmet mental health need, the adoption of the virtual modality, in terms of therapy and just the size and scale of BetterHelp. So what we wanna do is make sure we are, you know, preserving that user experience, which BetterHelp is known for, as we turn this on. Obviously, the scale is pretty massive. So the demand side will be there as we turn that on. The supply side, we also want to make sure that we have the right level of therapists credentialed in the network to meet the demand in the way that we want....

The adoption of the virtual modality in terms of therapy, and just the size and scale of better help. So what we want to do is make sure. We are preserving that user experience, which better help is known for as we turn this on obviously the scale is pretty massive so the demand side will be there as we turn that on the supply side we.

I also want to make sure that we have the right level of therapist Credentialing the network to meet the demand and the way that we that we want behind the scenes, we are continuing to build that network out.

Mala Murthy: We continue to believe the unification of the customer acquisition funnel between cash pay and insurance coverage will allow us to more effectively leverage better health advertising and marketing budgets. and leads to a lower acquisition cost per user over time. While not enough to offset the headwinds in the U.S. cash pay business, International users were up by a high single digit percentage over the second quarter of 2024. With more attractive customer acquisition costs, we plan to continue reallocating advertising spent to those markets. While still early, our localized launches continue to see good month-over-month growth in users.

Chuck Divita: Behind the scenes, we are continuing to build that network out beyond the single state, so that as we ramp further, we'll be able to turn on multiple markets over time. So I wouldn't necessarily think about it state by state, per se, because we're gonna reach a point where we're gonna be able to activate multiple markets. But we do want to take it methodical here at the start to make sure all the capabilities that we built in place are working. The good news is they've worked quite well, and we're at a position now where we're behind the scenes building the supply side.

On the single state so that as we ramp further.

Be able to turn on multiple markets over time, so I wouldn't necessarily think about it state by state per se, because we're going to reach a point, where we want them to be able to activate multiple markets, but we do want to take it methodically here at the start to make sure all the capabilities that we built in place are working and the good news is they worked quite well and we're at a position now where we are.

Behind the scenes building the supply side.

Thank you for your question Richard.

Operator: Thank you for your question, Richard. Our next question comes from the line of Lisa Gill with JP Morgan. Your line is now open.

Our next question comes from the line of Lisa Gill with J P. Morgan.

Your line is now open.

Mala Murthy: And we are evaluating opportunities for additional localized market launches over the balance of 2020. Insurance revenue totaled $2.4 million for the quarter, which was in line with expectations and attributable to uplifts. As we continue to build out the operating infrastructure to support the future scaling of our better health insurance. Better health adjusted EBITDA was $11.9 million in the second quarter. Adjusted EBITDA margin of 4.9% was in the upper half of our guidance range of 2.5% to 5.25%. The margin declines on a year-over-year basis was mainly due to lower revenue and incremental investments to advance the insurance policy.

Alright, thanks, very much good afternoon.

Lisa Gill: Hi, thanks very much. Good afternoon. Chuck, I wanted to go back to where you ended the call today. You talked about virtual healthcare can be a performance multiplier to help address key challenges in the evolving healthcare landscape. Clearly, failing managed care, we see that right now from a cost perspective. As a former managed care executive, what do you think are some of the biggest opportunities for Teladoc to help to really drive the cost or bend the cost curve going forward? And maybe if you could just spend a minute sharing some of the takeaways from last week. And is it talking more to providers? Is it talking to employers? Is it, you know, talking to the managed care organizations? What do you see are some of the biggest opportunities?

Chuck I wanted to go back to where you ended the call today, you talked about virtual health care can be a performance multiplier to help address key challenges and the evolving health care landscape clearly following managed care or we see that right now from a cost perspective as a former managed care executive what do you think are some of the biggest opportunity.

Knees for Teladoc to help to really drive.

The costs are bend, the cost curve going forward and maybe if you could just spend a minute sharing some of the takeaways from last week.

And is it talking more to providers as they are talking to employers does it talking to the managed care organizations, what what do you see are some of the biggest opportunities.

Yes, thanks for the question I think.

Chuck Divita: Yeah, thanks for the question. I think, you know, first of all, if you go back to where sort of virtual care took off, you know, it was, like I said in my prepared remarks, around access and convenience, and that's still an issue. You know, access to care, whether it's primary care, specialist care, it varies pretty significantly. So I think access will continue to be a place where virtual care can support the ecosystem. I think where the next sort of generation of that is, and the reality of it is, you know, each individual, all of us are unique. We have our own healthcare situation, needs, and expectations, and healthcare is also local.

First of all if you go back to where sort of virtual care took off.

Mala Murthy: is turning to guidance. We now expect 2025 consolidated revenue. of $2.501 billion to $2.548 billion. with the midpoint increasing slightly versus our prior rate. with an increase in integrated care outpacing a lower mental health outcome.

Like I said in my prepared remarks around access and convenience and that's still an issue you know access to care, whether it's primary care specialist care. It varies pretty significantly. So I think access will continue to be a place where virtual care can can support the ecosystem I think where the next sort of generation and that is in there.

Reality of as each individual all of US are unique we have their own health care situation and needs and expectations and health care is also local and so I think over time. The reason why we've been investing in the technology. We are in the approach. We have is because we think we have an ability to partner with a local delivery systems more and more over time to advance our.

Mala Murthy: Fiasco Divita is expected to be in the range of $263 million to $294 million. The midpoint of this range is slightly below the previous outlook, impacted by similar segment dynamics, and now incorporating the anticipated impact of tariffs, which I will speak about momentarily.

Chuck Divita: And so I think over time, the reason why we've been investing in the technology we are and the approach we have, is because we think we have an ability to partner with the local delivery systems more and more over time to advance our customers' strategies. So we have a number of things underway to do that, and I think then extending that longitudinal care capability to help complement the system, sometimes we'll be on point for those services, and other times we'll be playing a complementary role. And I do think that's where it's gonna evolve over time. I think with respect to the forum, it was a great event. I mean, there was a lot of excitement. We shared a lot about the progress we're making.

<unk> strategy. So we have a number of things underway to do that and I think then extending that longitudinal care capability to help complement the system, sometimes will be on point for those services and other times, we'll be playing a complementary role and I do think that's where it's going to evolve over time I think with respect to the forum. It was a great event.

Mala Murthy: Fully or free capital guidance of $117 million to $200 million remains unchanged. We now expect 2025 stock-based compensation expense in the range of $95 million to $105 million, approximately $10 million below our prior outlook, and a continued area of focus.

I mean, there was a lot of excitement we shared a lot about the progress we're making.

I'd say uniformly a lot of the things that you you are studying in health care or are alive and well. They are very concerned about the affordability issues cost increases provider capacity shortages and sort of the dynamics that are at play certainly in the health plan World a lot of uncertainty with respect to some of the changes that are vendor underway and I think there.

Chuck Divita: I would say uniformly, a lot of the things that you study in healthcare are alive and well. They're very concerned about the affordability issues, cost increases, provider capacity shortages, and sort of the dynamics that are at play. Certainly, in the health plan world, a lot of uncertainty with respect to some of the changes that are underway. I think there was, I would say, a good level of interest in the strategic direction we're taking and how we're approaching this issue. So I think the level of partnership is gonna be even deeper going forward, and I think we're gonna build on it in the coming months.

Mala Murthy: For the third quarter, we expect consolidated revenue in the range of $614 million to $636 million and adjusted even up in the range of $56 million to $79 million.

I would say a good level of interest in the strategic direction, we're taking and how we're approaching this this issue. So I think the level of partnership is is gonna be even deeper going forward and I think we're going to build on it in the coming months.

Mala Murthy: Drilling down into the segments, starting with integrated... We are raising and narrowing our full year 2025 revenue budget. which we now expect to be up 1.75% to 3.25% year-over-year. versus our prior guidance of Flats2Up. The increase of 100 basis points at the midpoint reflects our strong first half performance relative to guidance. coupled with updated assumptions on foreign We continue to expect Haskell to contribute approximately 200 basis points to four-year revenue growth. We are narrowing our full year 2025 Adjusted EBITDA margin guidance to 14.5% to 15.25% versus our prior range of 14.3% to 15.3%. which is up slightly at the minute.

Thank you for your question Lisa.

Operator: Thank you for your question, Lisa. Our next question comes from the line of Jessica Tassan with Piper Sandler. Your line is now open.

Our next question comes from the line of Jessica <unk> with Piper Sandler.

Your line is now open.

Hi, guys. Thank you so much for the detail.

Jessica Tassan: Hi, guys. Thank you so much for the detail. I was hoping maybe you could talk about 2026 for your chronic care solutions in particular. You know, where are we in the selling season for the chronic care condition, chronic care solutions, excuse me, and then just could you describe any kind of competitive efforts that you've noticed so far, retreats maybe that are expected to impact retention, competitive takeaways, and pricing next year? Thank you.

I was hoping maybe you could talk about 2026 for your chronic care solutions in particular.

Where are we in the selling season for the chronic care conditions chronic care solutions excuse me and then just could you describe any kind of competitive efforts that you've noticed so far retreats, maybe that are expected to impact retention competitive takeaways and pricing next year. Thank you.

Yeah, I'll just make some general comments here I think first of all.

Chuck Divita: Yeah, I'll just make some general comments here. I think, first of all, a lot of the things that we've said in prior quarters are continuing to be the case. You know, we've got employer channel continues to, I would say, largely be in line with our expectations. At this point in the year, we do have continued pressure on the health plan channel for all the reasons that that we've given. I think we've had, you know, a good level of interest across all of our solutions, chronic care included. We've added some accounts, including in, you know, health plans with respect to Medicare Advantage. We've Mala mentioned that the large we added last year, coming into this year in weight management. So there's good activity, there's good interest.

A lot of the things that we've said in prior quarters are continue to be the case, we've got employer channel continues to I would say largely be in line with our expectations at this point in the year. We do have continued pressure on the health plan channel for all the reasons that that we've given.

Mala Murthy: As previously discussed, this includes a roughly 40 basis point headwind from the catapult acquisition, excluding catapult dilution. Adjusted EBITDA margins would be up slightly year-over-year at the midpoint of the guidance. Our guidance of 101 million to 103 million U.S. integrated care members remains unchanged.

We've had a good level of interest.

Cross all of our solutions chronic care included we've added some accounts, including health plans with respect to Medicare advantage.

While we mentioned that.

We added last year coming into this year and weight management. So there is good activity is good interest I will say there is.

Some pause and some hesitation in terms of big moves by some of the players as they sort through their strategies.

Chuck Divita: I will say there's some pause and some hesitation in terms of big moves by some of the players as they sort through their strategies. Where we're focused, really back to the product innovation point, is how do we expand the level of services, and I think with this new Cardiometabolic Health Program that we're rolling out to meet a variety of needs. If you think about a patient, you know, we sort of card people up into these conditions. Well, it's a whole person, and so they're gonna move through the journey of maybe it's a weight issue, some other kinds of acuity that happens during the cycle of that person's life.

We're focused really back to the product innovation point is how do we expand the level of services and I think with this new cardio metabolic health program that we're rolling out to meet a variety of needs. If you think about a patient.

We sort of car people up into these conditions, while its a whole person and so theyre going to move through the journey, maybe it's a weight issue similar kinds of acuity that happens during the cycle of that person's life and so this program really is trying to be there in a more holistic way for those people and I think the features and enhancements.

Chuck Divita: And so this program really is trying to be there in a more holistic way for those people, and I think the features and enhancements that we put in place will be attractive to our customers. I think where we're headed, though, is really leveraging what is, I think, one of our greatest strengths, which is our clinical capabilities. You know, as a provider, we have primary care, we have specialist care, we have care teams. And I think when you're dealing with people with, you know, hypertension, diabetes, and obesity and those kinds of things, the ability to support them clinically, and if they're not on the right path, I think is where we can add value to the patient as well as to our client.

Put in place will be attractive to our customers I think where we're headed though is really leveraging what is I think one of our greatest strengths, which is our clinical capabilities as a provider. We have primary care. We have specialist care, we have care teams and I think when youre dealing with people with.

Mala Murthy: We continue to evaluate additional levers to mitigate the impact of tariffs now and into the future. This includes assessing alternative sourcing array. to diversify our supply chain. which we think is a prudent long format.

Hypertension, and diabetes and obesity and those kinds of things.

Mala Murthy: for the third quarter. We expect integrated care segment revenue growth to be down 0.5% to up 2.25% and adjusted EBITDA margin in the range of 14% and 15.5%.

Ability to support them clinically.

And if they're not on the right path I think is where we can add value to the patient as well as to our clients.

So what I would also add is.

Mala Murthy: You know, Jessica, what I would also add is, you know, it's not a surprise. The chronic care market is a highly competitive market. It is a fast-moving, fast-changing market. We know that.... You know, we are absolutely already, you know, with a cardiometabolic product that we have that Chuck mentioned, adding to the clinical capabilities that Chuck mentioned. That certainly gives us confidence in growing momentum in the chronic care business over time.

No it's not a surprise the chronic care market is a highly competitive market and it is a fast moving.

Mala Murthy: Recall that the third quarter of 2024 had included a favorable resolution of a prior period billing adjustment, which will drive a roughly 115 basis point headwind to revenue growth and roughly 95 basis point headwind to adjust the EBITDA margin in the third quarter of 2025. Importantly, we assume a return to sequential growth in chronic care program enrollment in the third quarter, driven in part by continued growth in our weight management program, which was augmented by the addition of one of our largest customers at the start of 2025. Regarding the second half case Our updated guidance implies a sequential step-up in revenue in the fourth quarter.

Fast changing Marvel we know that.

We are absolutely already.

You know with a cardio metabolic product that we have that Chuck mentioned, adding to the clinical capability that Chuck mentioned.

That certainly gives us.

Confidence and growing momentum in the chronic care business over time.

Only thing I would also say is if.

Mala Murthy: The other thing I would also say is, if you think about our 102+ million member base and what that represents in terms of cross-selling opportunity, if you think about the scale of recruitable with chronic disease and need for chronic managed care management that we already have, that I would say is sort of the, in some ways, the demand side that we already have for us to be able to continue to grow and penetrate. We've talked about the fact that our penetration levels are still relatively low, in the membership base we have.

If you think about our 802 plus million member base.

And what that represents in terms of cross selling opportunity.

Do you think about the scale of recordable with chronic disease and need for chronic care management that we already have.

Mala Murthy: driven largely by typical seasonality related to infectious disease. as well as contributions from new business implementations. It also implies a sequential increase in adjusted EBITDA dollars driven by the revenue increase coupled with discipline costs.

That I would say is sort of the.

<unk> the demand side that we already have for us to be able to continue to grow and penetrate you've talked about the fact that our penetration level are still relatively low.

Mala Murthy: Moving to Better Health. We are narrowing our revenue guidance range with a revised midpoint reflecting ongoing headwinds in our U.S. capital.

In the membership base, we have so if you combine the innovation that we're bringing in from the product side together with the scale of opportunity in terms of the.

Mala Murthy: So if you combine the innovation that we are bringing in from the product side, together with the scale of opportunity in terms of the recruitables and the member base we have, those are the assets that we are going to use, combined with our engagement capability and enrollment capability, and we are investing in that as well.

Mala Murthy: Although still in the early stages, we are encouraged by the progress of our insurance initiative, which we view as a critical driver for restoring long-term growth and a better health. We now expect a year-over-year revenue decline of 6.8% to 9.2% in 2025. compared to a prior outlook of a 3.75% to 9.75%. Our guidance continues to reflect approximately $10 million in insurance revenue for 2025, net of any makeshift from the existing cash payments.

The recruiter both on the member base.

Those are the assets that we are going to use.

Find with our engagement capable and enrollment capability and we are investing in that as well.

Thank you for your question.

Operator: Thank you for your question. Our next question comes from the line of Daniel Grosslight with Citi. Your line is now open.

Our next question comes from the line of Danielle <unk> with Citi.

Your line is now open hi, thanks.

Hi, Thanks for taking the question you mentioned that you expect a meaningful revenue contribution from better health insurance coverage in 2026, I was hoping you could provide a bit more color on that and the cadence we should expect throughout next year and similarly, if theres any.

Daniel Grosslight: Hi, thanks. Hi, thanks for taking the question. Mala, you mentioned that you expect a meaningful revenue contribution from BetterHelp insurance coverage in 2026. I was hoping you could provide a bit more color on that and the cadence we should expect throughout next year. And similarly, if there's any significant investments you need to make to kind of scale that in 2026 and the cadence of those investments. Thanks.

Mala Murthy: We expect a more meaningful revenue contribution in 2026, as we continue to methodically scale operations and expand our fair therapist network over the next six to 12 months, while steadily enabling access across additional. We now expect a better health adjusted EBITDA margin of 4% to 5.5% for the full year. with a midpoint down 75 basis points versus our prior guide. This revision primarily reflects the flow-to-impact of a lower revenue outlook, partially offset by incremental G&A reductions, as we continue to prioritize investments that support the growth of our insurance.

Significant investments you need to make.

To kind of scale that in 2006, and the cadence of those investments. Thanks.

Yeah.

So what I would say Danielle let me start with your second question first because we need to invest to be able to scale.

Mala Murthy: Yeah. So what I would say, Daniel, let me sort of start with your second question first, because we need to invest to be able to scale the insurance revenue. So we already are making investments, right? Remember, when we announced the Uplift acquisition back in April, we actually had taken down our Adjusted EBITDA, and the reason we did that was because of the investments we needed to make. Those investments are essentially in, think of it in two ways. One is just scaling up the number of people we need, the talent we need to be able to run this, this business within the BetterHelp segment. It's not an initiative any longer, it's a business. And the second is absolutely scaling up the operational capabilities, the back-end capabilities, billing, coding, all of that.

<unk> insurance.

Revenues.

So we already are making investments right remember when we announced the uplift acquisition back in April we actually had taken down our adjusted EBITDA.

The reason, we did that was because of the investments we needed to make.

Those investments are essentially in think of it in two ways. One is just scaling up the number of people we need the talent, we need to be able to run.

Mala Murthy: We remain focused on balancing top line growth with bottom line While we will not pursue inefficient customer acquisition, we are committed to maintaining strong traffic to better health in preparation for the broader insurance world. For the third quarter, we are guiding to better health segment revenue down 5% to 9.75% year over year, and an adjusted EBITDA margin of 1% to 3.75%, reflecting the early investment phase of scaling our insurance initiative.

This this business within the better health segment, its not an initiative any longer it's a business and the second is absolutely scaling up the operational capabilities the backend capabilities billing coding all of that.

So those are the kinds of investments we are making we have already started on making those investments and we are going to make investments in the back half of this year between Q3, and Q4 and I expect we will continue to do more.

Mala Murthy: So those are the kinds of investments we are making. We've already started on making those investments, and we are going to make investments in the back half of this year, between Q3 and Q4, and I expect we will continue to do more of it at a probably a more modest level into the first half of next year. In terms of your second question on how this will pace, I would say, look, we have said from the outset, back in April, we expect the revenue for insurance to scale and fully ramp up over the 6 to 12-month period, right? We have told you this year, we expect insurance to be about $10 million in revenue. I think we need to see how this paces through this year, Daniel, and get more proof points.

Mala Murthy: Lastly, our balance sheet remains strong. We retired $551 million in convertible senior notes that came due in the second quarter with cash on hand. The $1 billion convertible note maturing in June 2027 is our only remaining debt out. We remain comfortable with our leverage as net debt to trailing adjusted EBITDA stood at 1.1 times at quarter. We continue to believe our strong cash balance, cash flow generation, and business position provides us with optionality in the future.

More of it at a probably a more modest level in June.

First half of next year.

In terms of your second question on how this will pay.

I would say well look we have said from the outset back in April.

We expect the revenue for insurers to scale and fully ramp up over the six to 12 month period right.

And we have told you this year, we expect insurance to be about $10 million in revenue.

Mala Murthy: Separately, in mid-July, we entered into a new $300 million revolving credit facility which enhances our financial and operational flexibility. At the current time, there is nothing drawn on the facility and we have no immediate plans to use it.

I think we need to see how that paces to this tier Danielle and get more proof points.

As we said we soft launched in one stage early signs of progress are good.

Mala Murthy: You know, as we said, we have launched in one state. Early signs of progress are good. You know, we are hitting and checking off on all the metrics that we expect to see at about this point, but we need to see more proof points. And what I would say is, expect us to give a progress update in October and in February. You know, every time we talk to you on earnings calls, we will give you our progress updates on how things are going and how the scaling is going to case in through 2026.

You know, we are hitting and checking off on all the metrics that we expect to see at about this point.

Mala Murthy: Our capital allocation priorities remain unchanged. First, we look to maintain a strong balance sheet and an appropriate net leverage profile. Second, we will invest in the business to support our strategy through both organic and inorganic initiatives. And third, we will evaluate share repurchases as a potential use of cash.

We need to see more proof points and what I would say is expect us to give a progress update.

<unk> and in February every time, we talk to you on earnings calls, we will give you all progress updates on how things are going.

Chuck Divita: With that, let me turn the call back. Thanks, Mala. We continue to believe that virtual care could be a performance multiplier within the healthcare ecosystem, helping to address key challenges, and that Teladoc Health is well positioned to play a key role in doing so.

And how the scaling is going to pay in through 2027.

Okay.

Thank you for your question Daniel.

Operator: Thank you for your question, Daniel. Our next question comes from the line of Dilendra Singh with Willis. Your line is now open.

Our next question comes from the line of Joe interesting with Lewis.

Chuck Divita: Just last week, we hosted our annual Teladoc Health Forum event in Nashville, which brought together healthcare thought leaders, virtual care advocates, and innovators from across the globe to share their experiences, exchange perspectives, discuss strategies, and offer insights into the further advancement of virtual care. And spending time with many of our clients and partners in attendance, I was encouraged with a level of interest in deepening our partnerships and further collaborating to help them achieve their goals now and into the future.

Your line is now open.

Thank you and thanks for taking my questions. Chuck I. Appreciate you spending some time on GE capping the progress the company has made and all the initiatives we have put in place and the actions you've taken over the past one year, but where we stand now do you believe that you have all the pieces in place to get the company back on a revenue and EBITDA growth.

Dhilendra Singh: Thank you, and thanks for taking my questions. Chuck, I appreciate you spending some time on recapping the progress the company has made and all the initiatives you have put in place and actions you've taken over the past 1 year. But where we stand now, do you believe that you have all the pieces in place to get the company back on revenue and EBITDA growth and potentially accelerate in the coming years? And I completely understand all the integration and business transitions still ahead of us, but just curious about your view, if you still think there's some work needed for organic and inorganic product expansion or any, any restructuring.

Jailendra Singh: Thank you, and thanks for taking my questions. Chuck, I appreciate you spending some time on recapping the progress the company has made and all the initiatives you have put in place and actions you've taken over the past 1 year. But where we stand now, do you believe that you have all the pieces in place to get the company back on revenue and EBITDA growth and potentially accelerate in the coming years? And I completely understand all the integration and business transitions still ahead of us, but just curious about your view, if you still think there's some work needed for organic and inorganic product expansion or any, any restructuring.

And potentially accelerating the coming years and I completely understand all the integration business foundations to ahead of us, but just curious about your view. If you still think there is some work needed for organic and inorganic product expansions.

Operator: With that, we'll open it up for your questions. Operator? Of course.

Operator: We will now begin the question and answer session. We kindly ask that all participants limit themselves to one question. If you'd like to ask a question, please press star followed by one on your telephone keypad. If for any reason you'd like to remove that question, please press star followed by two. Again, to ask a question, press star one. As a reminder, if you're using a speakerphone, please remember to pick up your handset before asking a question.

Restructuring.

I appreciate the question I'm not sure I would say we're ever going to be done.

Chuck Divita: Yeah, I appreciate the question. I'm not sure I would say we're ever gonna be done, in a you know, highly competitive, dynamic, complex market, particularly in the US, in terms of advancing the vision, the strategy. So I wouldn't wanna set that expectation. I think we've made considerable progress. You know, from the technology we put in place, we now have the ability to surface information across each one of our care engagement, whether it's Catapult, our gen med visits, our coaches, our mental health providers, we can action and surface information there that for the next best action. So there's a lot of things that I think we put in place. Clinically, we come from a strong position with all the history the company has.

A highly competitive dynamic complex market, particularly in the U S.

In terms of advancing division our strategy. So I wouldn't want to set that expectation I think we've made considerable progress from the technology. We put in place. We now have the ability to surface information across each one of our care our engagement with us catapult, our gem that visits our coaches are mental health.

David Roman: Our first question comes from the line of David Roman with Goldman Sachs. Your line is now open. Thank you. Good afternoon. Good afternoon, everybody.

Riders, we can action and surface information there that for the next best action. So theres a lot of things that I think we've put in place clinically we come from a strong position with all the history. The company has however, theres additional capabilities, we're going to put in place to be able to.

David Roman: A lot of moving parts here, so I'll try to make sure I limit it here to one question. I guess you've talked about over the past year, Chuck, the transitional way from a subscription model to a pay-per-visit or pay-per-use model that does, to some extent, obfuscate the underlying performance of the business. And I know you went through a few metrics on the call, but maybe you could unpack a little bit what's going on there and where we are in that transition, either if you can give us a sense of, is that a 2025 event? Is that extended to 2026?

Chuck Divita: However, there's additional capabilities we're gonna put in place to be able to, you know, continue to develop new intervention models for these individuals with chronic conditions. So I think you're gonna see us continue to invest organically, as well as if we think there are places that could accelerate our progress, we're gonna look for those opportunities, just like we did with Catapult. You know, that was a really nice strategic complementary acquisition. It's resonating with our clients. They understand why we did it, one, because of their own capabilities, which is, you know, quite effective, but the opportunity to use that as another point of engagement for people that aren't engaged in their healthcare, and to get them aware of their healthcare conditions, and get them plugged into whether it's a Teladoc services or get them a care plan.

To develop new intervention models for these are individuals with chronic conditions. So I think youre going to see us continue to invest organically as well as if we think there are places that could accelerate our progress we're going to look for those opportunities just like we did with catapult you know that was a really nice strategic complementary acquisition, it's resonating with our clients.

They understand why we did it one because of their own capabilities, which is quite effective but the opportunity to use that as another point of engagement for people that aren't engaged in their health care and to get them aware of their health care conditions.

Chuck Divita: And how you're thinking about measuring success in that initiative.

Chuck Divita: Yeah, I appreciate the question. You know, this, this transition has been going on for a few years now, in earnest, because, you know, post pandemic, obviously, with the broad adoption and maturity of the market, and that's continued. In 2025, we now are at a point where more than 50% of the majority of our revenues in virtual care are coming from visit-based arrangements versus subscription-based. So there's more room to go there, probably, but we've sort of reached a place where it's the majority, and it varies a little bit by product line. In mental health, we're now at about 70% that are visit-based.

And get them plugged into whether it's a teladoc services or or get them. A care plan. So I think there are going to be continued investments that we're going to make to be able to have a sustainable growth path in the U S and attack some of those bigger challenges of the health care system as we are well positioned to do it but we aren't finished yet I think the other thing I would say all of it.

Chuck Divita: So I think there are going to be continued investments that we're gonna make to be able to have a sustainable growth path in the US, and attack some of those bigger challenges that the healthcare system has. We're well positioned to do it, but we aren't finished yet. I think the other thing I would say, I'll end with this, with BetterHelp, you know, as we've seen from the last many number of quarters, that's been a business that's been very challenging on the consumer front, with notwithstanding all of its strengths. So making a move like Uplift and being able to demonstrate progress on insurance, we do believe that that transition over time is going to position BetterHelp to return to a growth trajectory.

We entered this with better health.

As we've seen from the west many number of quarters, that's been a business that's been very challenging on the consumer front with notwithstanding all of its strength, so, making a move like uplift and being able to.

David Roman: So you'll start to see over time more of that underlying growth in visits, which is a good thing, and translate into revenue growth, but we've still got a little bit of headwind from that side. Great, thank you very much. Thank you for your question.

Demonstrate progress on insurance, we do believe that that transition over time is going to position better help too.

<unk> returned to a growth trajectory. So I think both integrated care and better health. We've made some really good progress and I think we're going to build on it.

Chuck Divita: So I think both Integrated Care and BetterHelp, we've made some really good progress, and I think we're gonna build on it.

Richard Close: Our next question comes from the line of Richard Close with Canaccord Genuity. Your line is now open. Yes, thanks for the questions. Congratulations on the progress.

Thank you for your question.

Operator: Thank you for your question. Our next question comes from the line of Elizabeth Anderson with Evercore. Your line is now open.

Our next question comes from the line of Elizabeth Anderson with Evercore.

Your line is now open hi, guys.

Richard Close: Maybe on better help in insurance, first, can you discuss, you know, how you see the margin difference between cash pay and insurance, I guess, longer term? And then second, you know, your launch, I think you said launching insurance in one state, a soft launch. How are you thinking about the rollout going forward? Is that just a state by state basis?

Hi, guys. Good afternoon. Thanks, so much for the question.

Elizabeth Anderson: Hi, guys. Hi, guys, good afternoon. Thanks so much for the question. One of the highlights of the quarter, it looks like, which is, for me at least, is like the strong international growth as part of the broader strategy. Can you talk about, given that you have a variety of opportunities across your portfolio, as you've highlighted, the BetterHelp, et cetera, how do you think about that? Is there any sort of change in terms of the emphasis you're putting on that business, given the lower acquisition costs that, Mala, you mentioned? Or do you see that as sort of continuing along the path that you sort of previously described for us? Thanks.

What are the highlights of the quarter it looks like for.

For me this is like the strong international growth as part of the broader strategy can you talk about given that you have a variety of opportunities across your portfolio as you've highlighted that better health et cetera.

How do you think about that is there any sort of change in terms of the emphasis you're putting on that business given the lower acquisition costs that you mentioned or do you see that as sort of continuing along the path that you took previously described for us yeah.

Chuck Divita: So, thank you, Richard, for the question. Look, on the margins for insurance. If you think about the legacy cash pay business in better health. We have always said that the gross margins for that business are, you know, in the range of overall Teladoc health margins, right? It's always been around the high 60s, early 70s. Relative to that, you know, as we have thought about insurance, we recognize that it is going to be lower than that, those levels. You know, it's a little bit early for us to comment on exactly where it is going to reach equilibrium in the longer term.

So when you think about our international business, we need to think about it both on the integrated care slide as well as on the bed side. So on the integrated care side Elizabeth.

Mala Murthy: Yeah. So when we think about our international business, we need to think about it both on the Integrated Care side as well as on the BetterHelp side. So on the Integrated Care side, Elizabeth, what I see this business performing at is very reliably, you know, in the mid-teens, including this quarter. It was in the mid-teens on a constant currency basis, actually higher, high teens on a reported basis because of foreign exchange tailwinds. And, you know, this is a business that is looking at and working with clients around the world, you know, Canada, UK, Europe, Australia. You know, those are the countries that we have a strong B2B international business presence in. We have clients who have been with us for a long time, for many years, and we have a robust relationship with them.

I see the business performing at is very reliably.

In the mid teens, including this quarter.

It was in the mid teens on a constant currency basis was actually higher high teens on a reported painful because of foreign exchange tailwind and.

This is a business that is looking at and working with clients around the world.

Canada, UK Europe, Australia.

Those are the countries that we have a strong b to B international business presence.

Chuck Divita: But, you know, there are enough public proxies out there that will tell you that it is a lot lower than those levels. Having said that, what we are, you know, what we are focused on is the fact that we have 4 million plus... http://www.thevenusproject.com And we believe that offering the choice of insurance acceptance side-by-side with cash pay, which is what is live on our platform now in one state, as we talked about, is going to allow for greater conversion than we have with just... So that is the investment thesis we have that we will. progress on as we scale this initiative.

We have clients, who have been with us for a long time for many years.

We have a robust relationship with them and then the last thing I'd point out is what Chuck said in his prepared remarks, we are making real progress in working with the public health system in Canada, We are expanding province by Province for example in Canada.

Mala Murthy: And then the last thing I'd point out is what Chuck said in his prepared remarks: We are making real progress in working with the public health systems in Canada. We are expanding province by province, for example, in Canada. They were part of our client event last week, and you know, we talked, they talked about how pleased they are with the partnership with us, and let's say Newfoundland and Labrador as an example. So that's sort of the work we are doing on the Integrated Care side. On the BetterHelp side, the way I would think about international is, so there are two subparts to it. The first is, we have now been in what I would call English-speaking countries internationally for a few years in BetterHelp. So think about those as the UK, Canada.

Part of our client event last week, and we talk to they talked about how pleased they are with the partnership with thoughtful and let's say in Newfoundland up an example.

New Labradors, another province, where we have expanded so that's sort of the work we're doing on the integrated care side.

On the better health side, the way I would think about international is well there are two parts to it. The first is we have now been and what I would call English speaking countries internationally for a few years and better health think about those as the U K.

Chuck Divita: Chuck? Yeah, and I'll talk a bit about the rollout. So I guess, think of it this way, supply and demand. We know the demand out there. One, the unmet mental health need, the adoption of the virtual modality in terms of therapy, and just the size and scale of BetterHelp. So what we want to do is make sure we are preserving that user experience, which BetterHelp is known for, as we turn this on. Obviously, the scale is pretty massive. So the demand side will be there as we turn that on. The supply side, we also want to make sure that we have the right level of therapists, credential in the network to meet the demand in the way that we want.

Canada.

What we are now doing starting really this year is expanding into other countries with in localized platform and product experience.

Mala Murthy: What we are now doing, starting really this year, is expanding into other countries with a localized platform and product experience. You know, this is still, I would say, relatively new, and we are seeing good signs of progress, one of which is we said in our prepared remarks, the growth in users in the quarter was high single digits. So I say this because we will continue to build on this localization initiative we have in international for BetterHelp. I expect us to roll out into additional countries. We are also learning, candidly, from launching these localized experiences. You know, it does require us to think about the experience with consumers, the therapists, et cetera.

This is this is still I would say relatively new.

And we are seeing good signs of progress one of which is we said in our prepared remarks the growth in users in the quarter with high single digit. So I say this because this is we will continue to build on this localization.

Chuck Divita: Behind the scenes, we are continuing to build that network out beyond the single state, so that as we ramp further, we'll be able to turn on multiple markets over time. So I wouldn't necessarily think about it state by state per se, because we're going to reach a point where we're going to be able to activate multiple markets. But we do want to take it methodically here at the start to make sure all the capabilities that we've built in place are working. The good news is they've worked quite well. And we're at a position now where we're behind the scenes building the...

Initiatives, we have in international for better health.

Kept us to rollout into additional countries. We are also learning candidly from launching these localized experiences.

It does require us to think about the experience with consumers a therapist et cetera. So it's we are taking learnings we have launched in these countries and building it into the next wave. If you will of countries that we are planning to launch it.

Mala Murthy: So we are taking learnings as we have launched in these countries and building it into the next wave, if you will, of countries that we are planning to launch into.

Richard Close: Thank you for your question, Richard.

Lisa Gill: Our next question comes to the line of Lisa Gill with J.P. Morgan. queue line is now open. Thanks very much. Good afternoon. Chuck, I wanted to go back to where you ended the call today. You talked about virtual healthcare can be a performance multiplier to help address key challenges in the evolving healthcare landscape. Clearly, following managed care, we see that right now from a cost perspective.

Your point on the integrated care part of international and I. Appreciate you raising that it's a I think an often underappreciated part of Teladoc, we have an amazing team their structure to really understand the unique local market needs and opportunities and they are very creative at coming up with solutions that makes it.

Chuck Divita: One more point on the Integrated Care part of international, and I appreciate you raising that. It's, I think, an often underappreciated part of Teladoc. We have an amazing team. They are structured to really understand the unique local market needs and opportunities, and they are very creative at coming up with solutions that make sense for that market. An example is that I think is really, really a great proof point, where they're using our hospital and health system technology, our devices; if you go to our website, you can see the pictures of those devices. They're using those in creative ways with those public health systems. And I was very gratified when they take those devices, and they are helping keep emergency departments open in rural communities....

Lisa Gill: As a former managed care executive, what do you think are some of the biggest opportunities for Teladoc to help to really drive the cost or bend the cost curve going forward? Maybe if you could just spend a minute sharing some of the takeaways from last week. Is it talking more to providers? Is it talking to employers? Is it talking to the managed care organizations? What do you see are some of the biggest opportunities? Yeah, thanks for the question. I think, you know, first of all, if you go back to where sort of virtual care took off, you know, like I said, in my prepared remarks around access and convenience, and that's still an issue, you know, access to care, whether it's primary care, specialist care, it varies pretty significantly.

For that market. An example is that that I think is really.

Really a great proof point, where they're using our hospital and health system technology. Our devices. If you go to our website you can see the pictures of those devices, they're using those in creative ways with this public health systems and I was very gratified when they take those devices and they are helping keep keep emergency departments open and rural communities, we're talking about life and death.

Keeping access available to populations in remote areas. So we're very proud of the work that's happening internationally and there's a lot of learnings that we are looking to import to the U S and vice versa overtime and I think it's important part of the company.

Chuck Divita: We're talking about life and death stuff, keeping access available to populations in remote areas. So we're very proud of the work that's happening internationally, and there's a lot of learnings that we're, you know, looking to import to the US and vice versa over time. And I think it's an important part of the company.

Thank you for your question.

Operator: Thank you for your question. Our next question comes from the line of Sarah James with Cantor. Your line is now open.

Our next question comes from the line of Sarah James with Cantor.

Chuck Divita: So I think access will continue to be a place where virtual care can support the ecosystem. I think where the next sort of generation of that is, and the reality of it is, you know, each individual, all of us, or you know, we're all unique, we have our own health care situation and needs and expectations, and health care is also local. And so I think over time, the reason why we've been investing in the technology we are and the approach we have, is because we think we have an ability to partner with the local delivery systems, more and more over time to advance our customers.

Your line is now open.

Thank you.

You said earlier that you expect will better help too.

Sarah James: Thank you. You said earlier that you expected BetterHelp to exit the year flat with the prior year. Can you talk a little bit more about what's changed relative to your prior expectations, and will BetterHelp return to growth mode in 2026?

The year flat with the prior year can you talk a little bit more about what's changed relative to your policy from Glen will better help return to growth mode in 2024.

Yeah I think.

Mala Murthy: Yeah, I think it's a really good question, Sarah, and let me sort of give you a little bit of a longer answer on that to set the overall context. So as we have always said, when we talk about BetterHelp, especially our guidance, our revenue guidance range, incorporates a range of expectations, right? It's based on many factors, our ability to drive user growth, looking at what the macro backdrop looks like, the consumer sentiment. We had talked in the April earnings call about softening, potentially softening consumer sentiment, customer acquisition costs, churn rates, et cetera. In Q2, we did see incremental pressure in our US cash business from lower retention, so higher churn and fewer gross user additions, okay?

Let's say, it's a really good question and let me sort of.

Chuck Divita: strategies. So we have a number of things underway to do that, and I think then extending that longitudinal care capability to help complement the system sometimes will be on point for those services, and other times will be playing a complementary role, and I do think that's where it's going to evolve over time.

Give you a little bit of a <unk>.

Longer answer on that to set the overall context.

As we have always said when we talk about better help especially.

Chuck Divita: I think with respect to the forum, it was a great event. I mean, there was a lot of excitement. We shared a lot about the progress we're making. I would say uniformly, a lot of the things that you study in healthcare are alive and well. They're very concerned about the affordability issues, cost increases, provider capacity shortages, and sort of the dynamics that are at play. Certainly in the health plan world, a lot of uncertainty with respect to some of the changes that are underway, and I think there was a, I would say, a good level of interest in the strategic direction we're taking, and how we're approaching this issue.

Our guidance our revenue guidance range incorporates a range of expectation right.

It's based on many factors our ability to drive user growth.

Looking at what the macro backdrop looks like.

Yeah My sentiment as we have talked in the April earnings call about softening potentially softening consumer sentiment.

Our acquisition cost churn rates etcetera.

The second quarter.

We did see incremental pressure.

Chuck Divita: So I think the level of partnership is going to be even deeper going forward, and I think we're going to build on it. Thank you for your question, Lisa.

In our U S cash business from <unk>.

<unk> retention, so higher Sean and fuel our growth user ads.

Addition, okay and that is what led to the lower user count that we reported about 9000 lower sequentially.

Jessica Tassan: Our next question comes from the line of Jessica Tassan with Piper Sandler. Your line is now open. Hi guys, thank you so much for the detail.

Mala Murthy: And that is what led to the lower user count that we reported, about 9,000 lower sequentially. And, you know, if you - if we - as we've analyzed what's contributed to that, we believe that these - this is actually being driven by more consumers using insurance for their mental health needs, for mental health therapy, and an increase in advertising by other virtual mental health companies that offer insurance coverage. So we now assume that these trends are going to remain consistent for the balance of the year, and, you know, that is what is incorporated in the guidance range that we have now provided. So as such, you know, we've revised our outlook, which we've obviously now talked about. We have narrowed it and brought the sort of midpoint down, if you will.

Yeah.

And if you if we as we've analyzed what's contributed to that we believe that these this is actually being driven by more consumers using insurance for their mental health need for mental health therapy.

Jessica Tassan: I was hoping maybe you could talk about 2026 for your chronic care solutions in particular. You know, where are we in the selling season for the chronic care conditions, chronic care solutions, excuse me. And then just, could you describe any kind of competitive efforts that you've noticed so far, retreats maybe that are expected to impact retention, competitive takeaways and pricing next year? Thank you.

And that increase in advertising by other virtual mental health companies that offer insurance coverage.

So.

We now assume that these trends are going to remain consistent for the balance of the year.

Chuck Divita: Yeah, I'll just make some general comments here. I think first of all, a lot of the things that we've said in prior quarters are continue to be the case, you know, we've got employer channel continues to, I would say, largely be in line with our expectations. At this point in the year, we do have continued pressure on the health plan channel for all the reasons that we've given, and I think we've had, you know, a good level of interest across all of our solutions, chronic care included. We've added some accounts, including in, you know, health plans with respect to Medicare Advantage.

And you know that is what is incorporated in the guidance range that we have now provided.

So as such we have.

Revised their outlook, which we've obviously now talked about we have narrowed it and brought the sort of midpoint down if you will.

And it now assumes year over year revenue growth towards the lower end of our previous guidance revenue guidance.

Mala Murthy: It now assumes year-over-year revenue growth towards the lower end of our previous guidance, revenue guidance. If you think about what that also means, based on the Q3 guidance and the updated 2025 guidance, what it means is that the implied high end of the Q4 guidance range does not contemplate a return to flat year-over-year growth in the Q4. Okay? Just to be sort of spelling it out very clearly. Now, adding to that is the fact that we have insurance where we are seeing encouraging early signs, but we have talked about the fact that it needs time to scale. We continue to expect $10 million of insurance revenue this year, as we have talked about, and we are pleased with, you know, the scaling of that overall initiative.

And if you think about what that also means based on the third quarter guidance and the updated 2025 guidance. What it means that is that the implied high end of the fourth quarter guidance range.

Chuck Divita: We've, Mala mentioned it, that we added last year, coming into this year, weight management. So there's good activity, there's good interest. I will say there's some pause and some hesitation in terms of big moves by some of the players as they sort through their strategies. Where we're focused, really back to the product innovation point, is how do we expand the level of services, and I think with this new Carter Metabolic Health program that we're rolling out, to meet a variety of needs. If you think about a patient, you know, we sort of carve people up into these conditions, well, it's a whole person.

It does not contemplate a return to flat year over year growth in the fourth quarter, Okay just to be.

Sort of spelling it out very clearly.

No.

Adding to that is the fact that we have insurance, where we are seeing encouraging early signs, but we have talked about the fact that at the time to scale. We continue to expect $10 million of insurance revenue. This year as we have talked about and we are pleased with the scaling of that overall initiative.

Chuck Divita: And so they're going to move through the journey of maybe it's a weight issue, some other kinds of acuity that happens during the cycle of that person's life, and so this program really is trying to be there in a more holistic way for those people, and I think the features and enhancements that we put in place will be attractive to our customers. I think where we're headed, though, is really leveraging what is, I think, one of our greatest strengths, which is our clinical capabilities. You know, as a provider, we have primary care, we have specialist care, we have care teams. And I think when you're dealing with people with, you know, hypertension and diabetes and obesity and those types of things, it's really important that we have a team of people The ability to support them clinically, and if they're not on the right path, I think is where we can add value to the patient as well as...

Yeah.

So all of this put together what I would say is as I think about next year.

Mala Murthy: So all of this put together, what I would say is, as I think about next year, you know, we need to see how these different things pan out, how insurance scales in 2026, and provides the necessary offset for the cash pay business, especially in the US. That's a little bit of a longer view of how we are seeing the puts and takes in the BetterHelp business.

We need to see how these different things pan out how insurers scale in 2026.

And provides the necessary offsets.

For the cash pay business, especially in the U S.

That's a little bit of a longer.

View of how we are seeing the puts and takes and the better health business.

Chuck Divita: You know, Jessica, what I would also add is, you know, it's not a surprise, the chronic care market is a highly competitive market. It is a fast moving, fast changing market. We know that. You know, we are absolutely already, you know, with a cardiometabolic product that we have that Chuck mentioned, adding to the clinical capabilities that Chuck That certainly gives us confidence in growing momentum in the chronic care business over time. The other thing I would also say is, if you think about our 102-plus million member... and what that represents in terms of cross-selling. Think about the scale of recruitable with chronic disease and need for chronic care management that we already have.

Thank you for your question.

Operator: Thank you for your question. Our next question comes from the line of Charles Rhyee, Cowen. Your line is now open.

Our next question comes from the line of Charles Meade County.

Your line is now yes.

Yes. Thanks.

Yes, thanks for taking the question.

Charles Rhyee: Yeah, thanks. Thanks. Yes, thanks. Thanks for taking the question. Chuck, maybe I want to ask Lisa's question maybe a little bit in the reverse. You know, obviously, during COVID, the use of virtual care skyrocketed, in part because that was the only options. We also recognized the great demand for behavioral health services as well, and BetterHelp filled an important need during that period of time. You know, since then, we've seen the use of virtual care drop, you know, fairly dramatically. You mentioned, you know, obviously, you talked about sort of the opportunities of where virtual care can be used. You know, I know to another question, I think you talked about sort of penetration rates remain relatively low.

Chuck maybe I want to ask a question, maybe a little bit of the reverse.

Obviously during COVID-19 the use of virtual care skyrocketed in part because that was the only options.

We also recognize the great demand for behavioral health services, as well and better help fill the unimportant.

Need during that period of time.

Since then we've seem to use the virtual care dropped fairly dramatically.

You mentioned, obviously, you talked about sort of the opportunity as a way of virtual care can be used.

I know it's another question I think you talked about sort of penetration rates remain relatively low.

Chuck Divita: That, I would say, is sort of. In some ways, the demand side that we already have for us to be able to... We've talked about the fact that our penetration levels are still relatively low in the membership base. So if you combine the innovation that we are bringing in from the product side together with the scale of opportunity in terms of the and the member base we have. Those are the assets that we are going to use combined with our engagement capability and enrollment capability. and we are investing in that.

I think Jeff you also talked about healthcare being very local and it's a very individual people as well what are what are the big challenges that you see in.

Charles Rhyee: You know, I think, Chuck, you also talked about healthcare being very local, and it's very individual for people as well. What are the big challenges that you see in? You know, I guess, the question really is, what has been really the limiting factor then, in getting sort of that penetration up? Is it really at the provider level in changing how they deliver care? And is that maybe more of a systemic thing in just how the workflows are designed, or is it at the payer level where, you know, how benefits are designed and sort of set up? Or is it really just a consumer level of just people wanting to be in person with someone?

I guess the question really is what has been really the limiting factor them in.

And getting sort of that penetration up.

Is it really at the provider level changing how they deliver care and is that maybe more of a.

More of a systemic thing and just how the workflows are designed or is it at the payer level, where you know how benefits are designed in.

Set up.

A similar level of just people wanting to be in person.

No.

Charles Rhyee: Just trying to understand, you know, you can talk about innovation, and I guess the question really is more, what's in your control, versus what is it more that you have to wait for the market to, you know, come around, to understand? Thanks.

You talked about innovation and I guess the question really is more what's what's in your control versus what is it more that you have to wait for the market to come around just understood. Thanks.

Daniel Grosslight: Our next question comes from the line of Daniel Grosslight with Citi. Your line is now open. All right, thank you. Thanks for taking the question. Mala, you mentioned that you expect a meaningful revenue contribution from Better Health Insurance coverage in 2026. I was hoping you could provide a bit more color on that and the cadence we should expect throughout next year. And similarly, if there's any significant investments you need to make to kind of scale that in 2026 and the cadence of those investments. Thanks.

Yes, I appreciate the question so a cut.

Chuck Divita: Yeah, I, I appreciate the question. So, a couple of things. I think you're gonna see over time, continued recognition that there's not enough primary care in the United States. And I think virtual, there's, there's, at least a more openness to, virtual primary care, and I think that you'll see, you'll see that continue on. I think the bigger part of your question, though, is, and this is kind of how we're thinking about it: if you'll recall back when I joined, I, I started highlighting this. You know, we have millions and millions of engagement points each year, through the various visits that we do. Those, those were previously seen as visits. I see them as engagement points.

A couple of things I.

I think youre going to see over time.

Continued recognition that there's not enough primary care, United States and I think virtual there's there's a at least a more openness to.

Virtual primary care and I think that Youll see youll see that continue on I think the bigger part of your question, though is and this is kind of how we're thinking about it if you recall back when I joined I started highlighting is we have millions and millions of engagement points each year for the various business that we do those those were previously seen as visits I see.

Mala Murthy: For more information visit www.besthealth.com Yeah. So what I would say, Daniel, let me sort of start with your second question first, because we need to invest to be able to scale the insurance So we already are making investments, right? Remember when we announced the uplift acquisition back in April, we actually had taken down our adjusted EBITDA, and the reason we did that was because of the investment. Those investments are essentially in, think of it in two ways, one is just scaling up the number of people we need, the talent we need to be able to run this business within the better health segment.

The most engagement. So that's why we put this technology in place that allows us to start activating different strategies to create value for clients in that way. So maybe it's that same visit but I can also address the care gap closure, maybe I can also help that individual.

Chuck Divita: So that's why we put this technology in place that allows us to start activating different strategies to create value for clients in that way. So maybe it's that same visit, but I can also address a care gap closure. Maybe I can also help that individual get navigate them to the next best action. Maybe I can resolve things more holistically than I do today with respect to bringing specialists to the table and provider-provider consult. So there are ways that we can make this engagement points more impactful, more valuable to clients specifically, and I think the virtual care system up until now has been set up to do.

Get navigate them to the next best action, maybe I can resolve things more holistically than I do today with respect to bringing specialist to the table and provider provider console. So there are ways that we can make this engagement points more impactful more valuable.

Clients.

Mala Murthy: It's not an initiative any longer, it's a business. And the second is absolutely scaling up the operational capabilities, the back end capabilities, billing, coding, all of that. So those are the kinds of investments we are We've already started on making those investments, and we are going to make investments in the back half of this year. And I expect we will continue to do more of it at probably a more modest level into the first half of the year. In terms of your second question on how this will pay. I would say, look, we have said from the outset back in April.

Particularly but I think the virtual care system up until now has been set up to do its been very transactional in many ways and I think trying to create a little bit more of a longitudinal opportunity is really where we're going to be able to drive more volume and more impact.

Chuck Divita: It's been very transactional in many ways, and I think trying to create a little bit more of a longitudinal opportunity is really where we're gonna be able to drive more volume and more impact.

Thank you for your question.

Mike Minchak: Thank you for your question. That will close our question and answer session for today. That concludes today's call. Thank you for your participation, and enjoy the rest of your day.

Operator: Thank you for your question. That will close our question and answer session for today. That concludes today's call. Thank you for your participation, and enjoy the rest of your day.

That will close our question and answer session for today.

That concludes today's call. Thank you for your participation and enjoy the rest of your day.

Mala Murthy: We expect the revenue for insurance to scale and fully ramp up over the 6 to 12 month period, right? And we have told you this year we expect insurance to be about $10 million in revenue. I think we need to see how this paces through this year, Daniel, and get more proof points. You know, as we said, we have launched in one state. Early signs of progress are good. You know, we are hitting and checking off on all the metrics that we expect to see at about... But we need to see more proof points. And what I would say is expect us to give a progress update in October and in February.

Mala Murthy: You know, every time we talk to you on any calls, we will give you all progress updates on how things are going and how the scaling is going to cave in. Thank you for your question, Daniel.

Jailendra Singh: Our next question comes from the line of Jailendra Singh with Prillis. Your line is now open. Thank you, and thanks for taking my questions. Chuck, I appreciate you spending some time on recapping the progress the company has made and all the initiatives you have put in place and actions you've taken over the past one year.

Chuck Divita: But where we stand now, do you believe that you have all the pieces in place to get the company back on revenue and EBITDA growth and potentially accelerate in the coming years? And I completely understand all the integration and business financials still ahead of us, but just curious about your view, if you still think there's some work needed for organic and inorganic product expansion or any restructuring? Yeah, I appreciate the question. I'm not sure I would say we're ever going to be done in a, you know, highly competitive, dynamic, complex market, particularly in the US, in terms of advancing the vision, the strategy.

Chuck Divita: So I wouldn't want to set that expectation. I think we've made considerable progress, you know, from the technology we put in place, we now have the ability to surface information across each one of our care engagement, whether it's Catapult, our gen med visits, our coaches, our mental health providers, we can action and surface information there that for the next best action. So there's a lot of things that I think we put in place. Clinically, we come from a strong position with all the history the company has. However, there's additional capabilities we're going to put in place to be able to, you know, continue to develop new intervention models for these individuals with chronic So I think you're going to see us continue to invest organically, as well as if we think there are places that could accelerate our progress, we're going to look for those opportunities just like we did with Catapult.

Chuck Divita: You know, that was a really nice strategic complementary acquisition. It's resonating with our clients. They understand why we did it. One, because of their own capabilities, which is, you know, quite effective. But the opportunity to use that as another point of engagement for people that aren't engaged in their healthcare and to get them aware of their healthcare conditions and get them plugged into whether it's Teladoc services or get them a care plan. So I think there are going to be continued investments that we're going to make to be able to have a sustainable growth path in the U.S.

Chuck Divita: and attack some of those bigger challenges that the healthcare system has.

Chuck Divita: We're well-positioned to do it, but we aren't finished yet.

Chuck Divita: I think the other thing I would say, and I'll end with this, with better help, you know, as we've seen from the last many number of quarters, that's been a business that's been very challenging on the consumer front, notwithstanding all of its strengths. So making a move like Uplift and being able to demonstrate progress on insurance, we do believe that that transition over time is going to position better help to return to a growth trajectory. So I think both integrated care and better help, we've made some really good progress, and I think we're going to...

Chuck Divita: Thank you for your questions.

Elizabeth Anderson: Our next question comes from the line of Elizabeth Anderson with Evercore. Your line is now open. Hi, guys. Good afternoon. Thanks so much for the question. One of the highlights of the quarter, it looks like, for me at least, is the strong international growth as part of the broader strategy. Can you talk about, given that you have a variety of opportunities across your portfolio, as you've highlighted, to better help, et cetera, how do you think about that? Is there any sort of change in terms of the emphasis you're putting on that business, given the lower acquisition costs that, Mala, you mentioned?

Elizabeth Anderson: Or do you see that as sort of continuing along the path that you sort of previously described for us? Thanks. Yeah. So when we think about our international business, we need to think about it both on the integrated care side as well as on the better So, on the integrated care side, Elizabeth, what I see this business performing at is very reliably, you know, in the mid-teens, including this quarter, it was in the mid-teens on a constant currency basis, actually higher high-teens on a reported basis because of foreign exchange. And, you know, this is a business that is looking at and working with clients around the world, you know, Canada, UK, Europe, Australia, you know, those are the countries that we have a strong B2B international business presence.

Mala Murthy: We have clients who have been with us for a long time, for many years, and we have a robust relationship with them. And then the last thing I'd point out is what Chuck said in his prepared remarks. We are making real progress in working with the public health systems in Canada. We are expanding province by province, for example, in Canada. They were part of our client event last week, and they talked about how pleased they are with the partnership with us in, let's say, Newfoundland, as an example, New Labrador is another province where we have expanded.

Mala Murthy: So that's sort of the work we are doing on the Internet. On the better health side, the way I would think about international is so there are two subparts. The first is, we have now been in what I would call English-speaking countries internationally for a few years in better health. Now think about those as the UK, Canada. What we are now doing, starting really this year, is expanding into other countries with a localized platform and product. You know, this is still, I would say, relatively new, and we are seeing good signs of progress, one of which is, we said in our prepared remarks, the growth in users in the quarter was high So I say this because this is, we will continue to build on this localization initiative we have in international for better health.

Mala Murthy: I expect us to roll out into additional countries. We are also learning, candidly, from launching these localized experiences. It does require us to think about the experience with consumers, the therapists, et cetera. So we are taking learning as we have launched in these countries and building it into the next wave, if you will, of countries that we are planning to launch.

Mala Murthy: One more point on the integrated care part of international, and I appreciate you raising that. It's, I think, an often underappreciated part of Teladoc. We have an amazing team. They are structured to really understand the unique local market needs and opportunities. And they are very creative at coming up with solutions that make sense for that market. An example is that I think is really a great proof point. They're using our hospital and health system technology, our devices, if you go to our website. They're using those in creative ways with those public health systems, and I was very gratified when they take those devices and they are helping keep emergency departments open in rural areas.

Mala Murthy: We're talking about life and death stuff, keeping access available to populations in remote areas. So we're very proud of the work that's happening internationally, and there's a lot of learnings that we're looking to import to the U.S. and vice versa over time, and I think it's important Thank you for your question.

Sarah James: Our next question comes from the line of Sarah James with Cantor. You know, it's all of them. Thank you. You said earlier that you expected Better Health to exit the year flat with the prior year.

Mala Murthy: Can you talk a little bit more about what's changed relative to your prior expectations and will Better Health return to growth mode in 2020? Yeah, I think It's a it's a really good question, Sarah. And let me sort of give you a little bit of a longer answer on that to set the overall context. So, as we have always said, when we talk about better health, especially, our guidance, our revenue guidance range incorporates a range of Right. It's based on many factors, our ability to drive user growth, looking at what the macro backdrop looks like.

Mala Murthy: We have talked in the April earnings call about potentially softening consumer sentiment, customer acquisition costs, churn rate. Um, in the second quarter. We did see incremental pressure in our U.S. cash business from lower retention, so higher churn, and fewer gross user ads additions, okay? And that is what led to the lower user count that we reported, about 9,000 lower. And, you know, if we as we've analyzed what contributed to that, we believe that this is actually being driven by more consumers using insurance for their mental health needs for mental health therapy, and an increase in advertising by other virtual mental health companies that offer insurance coverage.

Mala Murthy: So We now assume that these trends are going to remain consistent for the balance of the year. And, you know, that is what is incorporated in the guidance range that we have now provided. So as such, you know, we've revised our outlook, which we've obviously now talked about, we have narrowed it and brought the sort of midpoint down, if you will. And it now assumes year-over-year revenue growth towards the lower end of our previous guidance, revenue guidance. And if you think about what that also means, based on the third quarter guidance and the updated 2025 guidance, what it means is that the implied high end of the fourth quarter guidance range .

Mala Murthy: does not contemplate a return to flat year-over-year growth in the fourth quarter. Okay, just to be. sort of spelling it out very clearly. Now.

Mala Murthy: Adding to that is the fact that we have insurance, where we are seeing encouraging early signs, but we have talked about the fact that it needs time to scale. We continue to expect $10 million of insurance revenue this year, as we have talked about, and we are pleased with, you know, the scaling of that overall insurance. So all of this put together, what I would say is, as I think about next year, you know, we need to see how these different things pan out, how insurance scales in 2026 and provides the necessary offset. for the cash pay business, especially in the U.S.

Mala Murthy: That's a little bit of a longer view of how we are seeing the puts and takes in the better health. Thank you for your question.

Charles Reeve: Our next question comes from the line of Charles Reeve County. Yeah, thanks for taking the question.

Charles Reeve: Chuck, maybe I want to ask Lisa's question, maybe a little bit in the reverse. Obviously, during COVID, the use of virtual care skyrocketed, in part because that was the only option. We also recognized the great demand for behavioral health services as well, and better health filled an important need during that period of time. Since then, we've seen the use of virtual care drop fairly dramatically. You mentioned, obviously, you talked about the opportunities of where virtual care can be used. Um, you know, I know it's another question, I think you talked about sort of penetration rates remain relatively low.

Charles Reeve: Um, you know, I think Chuck, you also talked about healthcare being very local and it's very individual for people as well.

Charles Reeve: What, what are the big challenges that you see in, you know, I guess the question really is what has been really the limiting factor then in, in getting sort of that penetration up? Um, is it really at the provider level in changing how they deliver care? And is that maybe more of a, more of a systemic thing in just how the workflows are designed? Or is it at the payer level where, you know, how benefits are designed and, and, and sort of set up? Um, or is it really just a consumer level of just people wanting to be in person with somebody?

Chuck Divita: Just trying to understand that, you know, you can count on this innovation and I guess the question really is more what's, what's in your control versus what is it more that you have to wait for the market to, you know, come around to a certain extent. Thanks.

Chuck Divita: Yeah, I appreciate the question. So a couple of things. I think you're going to see over time continued recognition that there's not enough primary care. virtual there's there's at least a more openness to virtual primary care and I think that you'll see you'll see that I think the bigger part of your question though is, and this is kind of how we're thinking about it. If you recall back when I joined, I started highlighting this, you know, we have millions and millions of engagement. with the various visits. Those were previously seen as visits. I see them as engagement points.

Chuck Divita: So that's why we put this technology in place that allows us to start activating different strategies to create value for clients in that way. So maybe it's that same visit, but I can also address a care gap closure. Maybe I can also help that individual navigate them to the next best action. Maybe I can resolve things more holistically than I do today with respect to bringing specialists to the table and provider-provider consult. So there are ways that we can make this engagement points more impactful, more valuable to clients. And I think the virtual care system, up until now, has been set up to do it's been very transactional in many ways.

Chuck Divita: And I think trying to create a little bit more of a longitudinal opportunity is really where we're going to be able to drive more volume. Thank you for your question.

Operator: That will close our question and answer session for today. That concludes today's call. Thank you for your participation and enjoy the rest of your day.

Q2 2025 Teladoc Inc Earnings Call

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