Teladoc Health (TDOC) 27 Oct 222022 Q3 Earnings call transcript

Hello and welcome to the Teladoc Health Third Quarter 2022 Earnings Conference Call. My name is Alex, and I'll be coordinating the call today. [Operator Instructions]. I'll hand over to your host, Patrick Feeley, Head of Investor Relations. Patrick, please go ahead.

afternoon. good and you Thank Today, after announcing a release we market third quarter closed, our issued XXXX press the financial results. and Relations teladochealth.com This on release the presentation slide press are the Investor section website. the of accompanying available On Chief Murthy, Officer; Gorevic, are Executive to this Officer. and discuss call Financial results Jason the Chief Mala

statements that release the will certain XXXX. for a are please our and is website. cause as during call, non-GAAP fourth we this that statements on made evaluating remarks defined prepared could relationship subject measures to During our forward-looking on uncertainties Litigation note that question-and-answer can Securities call. financial Health's our to full between call Teladoc Please be Private factors certain or and Reform discussing comparable we thereof will press that will this by forward-looking Also, most measures we'll quarter also provide followed this risks, session. posted to differ note outlook, implied in be Act measures those year be by in materially important actual are on be believe of found non-GAAP performance. GAAP the Details reconciliations the and these XXXX expressed statements that the Such from and results Health Teladoc other the

on which available our and our turn Jason. release are press filings to call website. information, additional in now over SEC, our refer to please all the statement For the I like of cautionary to with would our

execution $XXX of of above Health results $XX EBITDA year Teladoc for high over Good our Revenue After end Patrick. the close expectations. us. exceeded adjusted range. driven across reported our million, today, of to grew business. third you, And prior and XX% strong midpoint thanks quarter the million the the guidance joining Thank afternoon by solid the

shared proven relationships. we one more Shield trend in the strong proposition as virtual at I savings and to savings populations for X positioned value and care strategy, evidenced progress seeing broader tremendous we're challenging quarter, even operating areas across drive continued chronic remains our large at of and clients members fully meaningful XXXX, economy, market the present well our a second, favorable our see is early deals; fourth, a of with a clients, looking our interest in performance insured in increase during outcomes strong by members; for high better is example us made Blue care clear populations; that held advisory to for PrimaryXXX on outcomes our to was new chronic first, launched ability the chronic outcomes briefly with deals a chronic primary on pipeline, engagement pilots. We arrangements we're as conditions pilot the becoming features. and universally proven priority in closing care. with Earlier BetterHelp. look these health via the the macroeconomic with meaningful third, a delivering we results against highlight: current I We're deliver important with Blue An lower month, Cross we health care are including organizations drive driving who the at our panel costs programs While and capitalize with momentum and dynamic. very our in attendance. for plan. notable savings manage in product Starting can encouraged such view trend Value-based for that our want care environment and the systems It XX of recent large clients In leaders growing employers to partners of list value-based cost plans, from this outcomes. care that this environment. since And client and with chronic

team, models We leverage the Ultimately, capitalize toward on ability with ability do uniquely by validate and just client, we market and savings outcomes partner's measurable for virtual positions broad outcome believe over move arrangements. team more target us drive to for small we the study integrated this better pilot time. this realize but that it only of bonus. others cost exceeded savings digital a to believe concluded further contracting our able actuarial determined who we and have members Not medical a to we our to XX%. like care for demand shared drive these savings Our our our were to savings drive value-based

additional Turning start you told insight At later year. we the the to provide would the in we of PrimaryXXX. year,

provide greater today, seen results year rate primary front demonstrating connecting are is our far. PrimaryXXX's X we'll services, every high of as once we vote likely at members a in chronic value NPS so likely of care PrimaryXXX of not with care are We're first delivering. of who encouraging significant using a care. X this have And scores also seeing PrimaryXXX to to but or a some PrimaryXXX the door thus Meanwhile, meet conditions X also virtual significantly months, teams we're look a with strong year, to X just members you are those at XXs, with members currently with multi-specialty engaged X as confidence. the more This more members as care, in PrimaryXXX. satisfaction times than team. PrimaryXXX of role are with that engage result finding we've with our the every as a Members with reporting their

to confidence stages to the the response integrated a the market, and of member beginning lot client So at strong virtual service while us in primary bringing opportunity. gives long-term we're the the care of

represents first the roughly which from equivalent during to year. estimated same bookings, year, prior we turn developed the our expected momentum, incremental the contribution the period year. signed I the slowly of annual more discussed commercial in has the to the revenue we've As is into pipeline year throughout half Year-to-date than deals coming

contribute are, however, significant next We our by expect for of we to to growth that number years. the encouraged a new few deals

you just HCSC's seen launch The looking our partner month medical, year clients. groups. of available general to release press care to to to chronic health of employer follows and bring of our our momentum to partnership expand health clients. land and HCSC the PrimaryXXX is another products. we're heels represents example to nutrition seeing make to First, products mental of with example of self-insured us on along whole-person plans last our our across our last our offer This services this to have the and integrated announcing care products with suite partnership full deal agreement employer of employer large strategy And one with that services ability and validation bear may

care health In in plans partner. looking multiple addition to large this seeing to PrimaryXXX, chronic with momentum we're also

these expect multiyear contribute pipeline will We agreements over period. our a to

Finally, to close offering. competitors I many in underscores solutions Teladoc care, a different one Health. quarter, wanted trend correctional and integrated think the strongly the away while highlight of particular disparate chronic shifting solutions We're the we typically all we one favors providers at point once I from our broad value mental new of that believe market as it any replacing believe health offerings, proposition to employer in integrated care We service deals telemedicine across X government-run facilities is at our given of institutions. and myStrength and other largest toward

need tremendous to BetterHelp. uncertainty unmet to drive growth, while Turning line team the macroeconomic continued of increased in addressing services. top medical particularly for The impressive this time global

the at as While margin deliver below to yield we've of anticipated. where it year, on on spend advertising expected be seen beginning remains track remains to contribution. it the BetterHelp revenue and we strong stabilize

a building over in mental the leadership driving while growth turn position our We significant the expect I'll forward quarter upon Mala direct-to-consumer margin. and health to and review of call to third BetterHelp's guidance. market the With that, both for continue

you, Thank afternoon, and everyone. Jason, good

During expectations. year's as of approximately our quarter brand, over total growth in $XXX to quarter increased mental sequentially second was XX% our or line the that grew year-over-year direct-to-consumer X% third over The with BetterHelp, compared quarter, to driver which revenue health and the prior biggest million. the XX%

the continue expect see the consolidated fourth the to in spending quarter. the in We margin in season EBITDA expect slowdown during in adjusted to market, therefore, typical and advertising acceleration material direct-to-consumer seasonal holiday

to revenue of for by driven new a this increased our sequential to member past offering programs The in Turning million of in more year's the up the has efforts that primary care end the membership XX.X The population the was client, attrition virtual an higher-than-expected third of onboardings client's by resulted due the than quarter chronic access with in care to X,XXX increase lives member was chronic member increase expansions by members, prior of X% even or fee U.S. in driven including of compared clients. XX.X end decline rate $X.XX of care which the better to the slightly was care. enrollment quarter, quarter, total populations. and sector our of members decline combination members and Average If the in U.S. was quarter. only over We its would churn a an number a our one the I not X better in Individuals the also to have enrolled of of our the in per or quarter. client, third the to over chosen programs million this total loss year's loss, to X XX,XXX from within management enrollees decision the trending to visit a while over at third the would quarter testament the with second enrollment line care XXX,XXX cease quarter, second years, the chronic month third changes in still prior client ended existing loss leadership, X% is as XX,XXX second X.X engagement. quarter, quarter. of of full $X.XX year quarter. add government member per drive at paid million

end BetterHelp second members the of quarter new to quarter. third was membership in million $XX.X compared high EBITDA growth As the offset as the mix above guidance the growth by in quarter our added in compared million was quarter, largely million range. year's $XX.X to telemedicine we net Adjusted although by prior PMPM the revenue and X.X driven in

margin quarter quarter driven drive look costs upside. abandonment adjusted The per amortization expense third share, and efficiency. and of of gross per was with to Net and share our in as the acquired space control compared to in share stock-based includes Net relative technology primarily $X.XX development EBITDA per the Both quarter third $X.XX per of cost was share of share by expectations $X.XX loss stronger to third we lease loss contributed to per expense net per the of intangibles of associated share, loss XXXX. $X.XX a $X.XX office rationalization. outperformance compensation

million cash During the free quarter $XX in we million quarter, investments short-term $XXX flow third sheet. on and with the balance ended cash the generated and of

results to low the that near be forward turning we end of guidance Now Last noted were range. full to likely prior guidance. quarter, year our

updated with today expectation. that Our is guidance consistent

full the we billion $X.XXX year the XXXX, For range to to of revenue be in expect $X.XX billion.

the year EBITDA million the for $XXX range be expect full to We of $XXX million. in to adjusted

over We of XX million million increase to members expect prior total XX of guidance. our paid membership U.S. members, million X.X an

to visits growth XX% of XX.X visits, the to year be XX% expect representing million total million for between over prior the XX.X and year. We

million XXXX, we XX% to XX% of expect revenue quarter fourth $XXX $XXX million, of to representing of the year-over-year. growth For

We be turn With be in visits. between remarks. X.X million. that, visits to the quarter Jason range quarter of X.X adjusted million will for $XX the expected are million $XX and million EBITDA fourth call to back to to I fourth expect Total closing

are to and welcome team new Mala. Growth President our week, Thanks, Kornwasser Markets. we of pleased the This as Enterprise Laizer to Global

of questions. Laizer know driving performance Health, company diversification business franchise Officer optimize of company's services. CareCentrix, across as from he integration build to all profit strategy, live to their product new Operating impact potential growth With client leading our that, will open Teladoc of a diabetes the forward client him lives. was lines for Chief may role and to immediate closely everywhere excellence where channels look to all help you make revenue commitment operational and empowering further At for unlock with growing our on responsible we'll and his healthiest of through to will product people suite the Laizer whole-person know the an care and the and I working and strategy. Some of EBITDA call he Operator?

[Operator Instructions].

JPMorgan. today for of Gill question from Lisa first Our comes

the about quarter, third the so know going it's to Jason, season. ask selling I'm you

You talked a little deals. incremental signing some bit about

play of think about season idea of them And about new are can deals, about headwinds is the to as the give some implementation talked any payment about to newer think and perspective are we cost the the You But an XXXX? there think us going with how anything And where going to about? from you talked we pipeline how tailwinds else some is. or into of selling about 'XX. think you into models an of as anything

Yes. I'd you Thanks, didn't Lisa. if disappointed now. ask be that

appreciate the So question.

then Let with overview the bookings deeper about dig outlook revenue a pipeline me sort forward, think looks of little an like. I'll into start how and to of and our the going what

dynamics guidance until going I'll outlook, think February, I to but you the about on. some give if So the overall of we try give won't obviously, specific

year, first, if about next the BetterHelp. So think for factors swing I

macroeconomic a July that outlook. though. of can about growth reasonable call. more the of impact tied therefore, a to macroeconomic health That, of the We and expect course, to bit think see consumer, the it's to BetterHelp this little to the both be more in little discussed bit ways the as from business, we financial closely BetterHelp I cut As year, direct-to-consumer to sensitive dynamic

consumer So and since for a the helpful see consumer come coming doesn't economic that pressure, if significantly and If down be pressure consumer of more us. sees that in next box. recovery the and the could year one that that is online confident, things consumer more expensive feeling we inflation BetterHelp inflation more could buys the the

growth of comes and from started has should just to business expect a the fair think expect you to of to $X billion. And margin specifically approach continue year, BetterHelp. to to of our you think That see BetterHelp. a gross in fast. rate And It's scaled driving to take run of more that I also both half and and I some the of and balanced in us grown it's us incredibly improvement some this focus efficiency. on benefits growth second margin at

is when asked a to quarter look call thing development. third at catch-up would about I kind it second what I'd the comes of The you bookings. pipeline specifically, the quarter

pipeline the talk developing than heard you than slowly prior first in quarters expectations. about So or of more us years it couple slower the as our had

larger quarter third year. it but it of year The was not third our quarter of than that, saw in our of quarter last only a terms and turnaround the bookings, biggest bookings was significantly

total saw it almost quarter, puts us last that at of now So third year. place quarter gross the where through we year-to-date a the third we're identical sort through to bookings the

you reminder So at it's year, of of this BXB just a business, business. our if year bookings think about plus that BXB side on churn. side baseline the about how look next essentially our The minus revenue revenue to

the is last slightly line better years churn line was previous it with Our in and in to even year. over than several

season. always in really important The X So us. selling the significant we we quarter left still fourth there. don't for have see And any changes months is

to is to some time this that it our was There are the last closed. good As year. look we've pipeline at characteristics our what deals similar I pipeline, at

they closed larger Our significantly deals prior we've that been have are years. in than

significantly see size So ago Xx continuing to are the was -- third multiproduct quarters deals good in And year quarter, -- sales. contributes, our period. in it X/X than the it average That larger what XX% larger was what to size. of the deal a and multiple was We're over first obviously, is Xx X it our cross-sells. deal

gives you think some So that hopefully color. I

savings deals have prepared that more this value-based generate. in signed we about that bit little value-based Blue to I'm into deals we arrangements. We of well the the us further a share talked and give that at for our portends do that about year that And that pilot the upside And by some results deals. excited remarks asked are think You in more we've large plan. I value-based leaning us

Close Richard Canaccord. of question comes from next Our

Jason, a I could bit margins the BetterHelp. about balancing if I But had those you on in two, in. growth flip little talked

talk in in can suspect curious the maybe market competitors and with bit could economy, noise detail your Just the if tough that. share? about some back then some. pulled year maybe the you you on go of talked more earlier about have And I little a you Obviously,

as the just about So that in talk competitive environment well.

Yes.

virtual is Richard, with example out point whole -- as think, margins. the leaning of more as that I of the margin, say business. things interacting improves especially We're business. to -- into of BetterHelp It -- the to a gross group lot for combination there's efficient in with actually couple not margin. a consumers the digital well the focusing interactions effect on say, has We the I which way about always more more growth will consumer, that and sort yielded improvements visit try other have I'll of therapy that our on actually group margin volume. depressing of sessions, the a with gross optimize

is -- visits. we in with professional fewer the visits Fewer people resources. it more BetterHelp margin actually serve business because gross see to us that's enables our fewer improves and good actually So

an a impacting smaller group with care the largest of number in as higher cost definitely we're at clients both as, impact seeing health capital of a client example companies. CEOs good I some a our recently of of think mentioned, retention seeing that's consumer, our and couple just Richard, give our tightening that an about margin. the overall a I'll also I fair from landscape. clients, some in for what value spent we're good and And for So time margin also economic advisory other a industry. with of well lifetime things relative When of as share, some of market good environment or amount of comments member and a for are the to I've then

very In the quite to is client them. I was and fact, survive of definitely companies challenge going with be are to of whether mind questioning those them, some able a yesterday, for of frankly, large smaller top

I'm both that yet, that. clients quite as seen So shakeout sure not hearing well to other we've but that I very I'm attuned health a massive among that say is much a bit companies as would care

from from Singh Our Securities. comes question Truist next Jailendra

is to shift you general. like I'd if but encouraging, program BCBS in just outcomes play about the think wondering if company Should little a role bit going Clearly, understand of much a pretty was the in expected on Teladoc savings. in more shared some quantify the I we should to role from if evolve quarter pilot Jason, point understand the think spend in can we you to care. as benefit enabler? shift. out BBC is called at more taking company the more the as about to And the time are them in future? Trying to these Teladoc's value-based could Or the risk how you like

Yes.

in generated. focused management. signed we this will immaterial a And back. downstream We significantly shared maybe had It's it's specific to So conditions. Jailendra, In is. opportunity hear was that It's are PMPM is that. to share expected. welcome -- that savings the impact base probably outpaced savings pilot bit diabetes program a the bonus, specifically that the I that talk quarter. say the up nice on savings I'll But for to was on that I'm the we a savings and a it going case, from defer what we about shared small you. seeing what chronic to not little I'll we of quantify from and so

by shared a that, had XX% out The share we the with in the corridor was savings prepared way said for in where savings, we great risk we it deal relative where beat we had And risk worked I health As target. that in remarks, plan that the corridor. that to my structured, us.

of expansion the as that their our number of in downstream of we the has maybe services impacts terms populations. both one obvious of think isn't as population accelerated also that quite the result that, and serve we products bring and to that client significant that I the success is a

that guarantee to economic great frankly, value-based underlying as acceleration expansion making our arrangements. line and little a that serve of because is economic savings sets us. fees we benefit both boost shared lean learning impact. of the data population got us both and the those It quite can and put and The bonus do into up clinical we we record We're impact, on that the also our for more significant within from bigger of products impact, very of to that client. we of track happy the science the of that our and inured scale So to the

it been And the have I of the on making our past of saying generates infrastructure would X years. data months are investments sort add all we in the that return XX we that to over

an the example return this that. as is such on So of investments

Ryan Our next William comes from of question Blair. Daniels

high Jason, to interesting to It's go NPS. I back you're seeing that wanted PrimaryXXX. utilization, higher

if an drives to I'm might that savings with that clinicians your. there's you able over opportunity outcomes value-based so So the well be contracting curious better with as utilization garner time. as better to move into shared

go Yes. pleased I'll progress in of just I include my very, appreciate that couple very that. didn't other prepared a Ryan, PrimaryXXX. in I stats We're the with remarks. through

that I treating primary provider the was care about have almost not of points As least relationship haven't last they wouldn't in seen members seen we're of engage members seeing them in at were to especially employer things that physician X that with some PrimaryXXX. by a And illnesses, is who if some that didn't of fact XX% virtual I a a with have XX% what say they the but our access PrimaryXXX our the -- most years. to they I that sat moved talked with just largest chronic of relative the data the down clients, things talked about,

Star appropriate largest talk employers of relative never can't focused health necessary things of When if employees, the really I are take And some are of engage health the who in we we to early those the distant identification conditions consumers the interested are their know Because and they're do so screenings. chronic their to that care to on. large health long-term to plans, reasons, might right they're you're are Ryan, of because Ratings measures imagine care. closing HEDIS right, on we plan lesser and with and exactly and very to employer think gaps in over focused, partners, lean And into a all health and time. those to arrangements degree, value-based now, as starting for our when closing we steps you'll you system, to from with of continue talk partners our or And evolve going that franchise the some PrimaryXXX. I see

question Our comes Dodge RBC. of next Sean from

Maybe going back moment. to a for the gross margins

couple more So Are gross stepped a XX%, for those how on there Jason, any us we any items give think XX.X% in of basis, last And consolidated you should quarters onetime margin last detail -- with beyond about quarter, there that that? going in so up mentioned adjusted you sustainable on there? forward? closing pretty the you BetterHelp being on example. can the that, considerably I is drivers of now. the guess

and as as exactly we think performance margin, gone in remarks. efficiencies you margins the if Sean, you're about the -- gross the we've Yes. the our BetterHelp, The uptick prepared we have increase through in is coming from about improved talked our year. our we in in have biggest seeing right, in had gross been

the margin membership really Specifically, utilization our is that, that in around gross base. dynamics the the driver helping of of is

seeing also greater we our go group members to And those engaging kinds efficiency, that things and As we lead are the of therapy talked are members bit things a like margin we utilizing seeing it's through year. therefore, And we as gross more more. improving are about, little digitally.

years you certainly XXXX provider from gaining are what note, also have we to of more to model, really was also about our we in hybrid that about and terms purely is more a a of thing this, other well -- and productivity And The advancing think talked efficiency. going few model, a bit if model. we a ago

monitor and productivity sustained We full-time are that we obviously, with are the we'll margins. that on in seeing is the driving providers of that, our are continue, employees. optimize And part are that. the to But our now on initiatives metrics gross more the really like pleased that who impact it

Sandler. Jessica Our from next Piper question from Tassan comes

give multi-solution of we could on color within continue and the 'XX pricing exiting rate how Congrats hoping is bookings? And chronic We you care kind see think just how care as XXXX? you were a some chronic us business about then of trending, maybe the especially should good into adoption just Xand to quarter. growth on

question Yes. Mala take think the for hold pricing comment now market, most X, CCM on I X rates. pricing multiproduct the you are of and Jess, I'll One, growth mentioned, seeing sales. in maybe sales our can as We're reasons. probably

truth less entirety so is that many out portfolio And portion full -- the there who aren't the there of we much of even a can match have, it. the

apples-to-apples less And entire is buying services. there so in of the bundle

head-to-head single-point competitive price having to react So a it rather solution little gives us the defining bid. the opportunity to be a to bit more about clear than

talked I would say The is what about of reason second because we before.

some fees relative to at more mentioned and drive. our ROIs, risk stability capital Blue buying relative clients as of willing our the that, risk about measures, When just record of I track That clinical have able whether favor are you to what difficult players of are those solid and put for put about stability, derisks in going buyers, are for And fear is scale, Cross the environment. then does shared it because I some cases to cost enables willing be that and we to that fees savings. our play to Blue outcomes of are the plan, Shield to at among at in to that for even guaranteed in with it. in our heard clinical pricing kind And keep those and think, ourselves many with the a because smaller cases, continue us exist reason, pilot we risk third of to for and earlier We our the upside offering our longevity. opportunity who

generally, seeing So stable. staying is we're that it's I what think

single-digit high year around care growth, terms then, this to of chronic your expect have end would growth year. through And question the what in of us year. revenue this chronic next that's And exiting expect care we Jess, growth, I revenue into

from Our comes next Davis Securities. question of Stephanie SVB

we Congrats or us Cross greater of such Could that given of are walk through still the the this on XQ And solid could upside the quarter. EBITDA February, considering scale some cuts bit a upside, the magnitude more that? especially the any you Shield and on savings its focus Or you Blue similar from when you ramp? relationship? Blue on to think beat impact surprises, growth, granularity efficiency and a fuel to about a on ad moderate benefit DTC as January

Yes. Yes. Stephanie. Thanks,

of terms of in the the side So beat, of upside majority equation. on of the the came cost the the drivers

margin the given of those expectations, light we closely performance, obviously efforts, okay? especially I driver the just the and gross was the largely drivers walked resulted quarter. macroeconomic the internal efficiency more was of companies. utilization Relative and at our seeing other gross as the just and the this second performance at to I are line, development those BetterHelp environment, technology are better of the like beat performance, looking many biggest in pull-through year margin mentioned dynamics. So and And driver we in all of on improved The through our margin margin efforts, in some revenue

the does year it we guidance adjusted it about In QX, end way what of -- we year the to full quarter, when terms EBITDA we the this low full EBITDA following: last I'm adjusted talked our be near prior ramp for the for and our of is expect about expectations have the your around -- we thinking question range. mean

we you range I fourth the -- the spend EBITDA the much therefore this the as we so ramp sort the single the we in be for performance to sequential in and take before, remind muted, assumes just have the that more seasonally through million what pre-COVID at it optimize If -- the talked the if EBITDA have $XXX something now what range. can the ad step for that just in guidance I just updated about ad you dynamics. is every But we manage And driven COVID year, have back ad and QX QX was in we about, doing of will -- year right? deliver we to we spend returns. had far becomes new, seasonal expensive dynamics about BetterHelp pre-COVID, for pricing, our million those that. adjusted pullback think XXX And we the and $XXX adjusted that that quarter. still business ad said Our the solidly full our calls a spend expense holiday more just going again, changed, became therefore, advertising of is were not the around that think would lower back season, are in spending It by happened because our that that dynamics optimize business we largely

we technology is thing just included in business. the Of bit just anticipate EBITDA, do EBITDA. BetterHelp, to the I would adjusted business step-up as terms a you a course, is sequential that in those development That And invest say out terms in and a for the visible have was we is then guidance quarter fourth is as continue we in know, it more it in given now adjusted other pre-COVID, more the than spend scaled XQ in of for so dynamics. of QX

next Our Charles Rhyee comes Cowen. from question of

the secondly, sense around who you available it's as has it characterized what a about been as really actual is I the us clients, something gave engaged you have who driven you? care selling by members team? and your think that's what metrics the those then you driven of for PrimaryXXX, self-insured available in in by some for virtual we it's Can give HCSC think product? next us it. of to selecting members expectations with members uptake that Or for, year? is then Jason, for efforts terms are a their If HCSC And terms primary pushing

the they a decision clients. Yes. our that want to team management Their go of work PrimaryXXX to It's or with to self-insured always approach. make partners We any clients programs. chronic care their our engage self-insured have with

a that's sell. team so And

Our that's we've a with as engaged And team theirs. is multiyear deeply said, approach.

overall to partners health work years plan we we the penetrate population, So through and eligible PrimaryXXX book the course are multiple their that now of coverage. we of for several that as benefit the have with. see insurance members other to that who over thousand business respect With expect of we the hundred

that integral We've rapidly. of of members growing plans in thousands care an as have We have tens them. part enrolled visits of primary of and who have PrimaryXXX done thousands it's this year,

that volume And of versus the significant saw we point. year. it year we we are quantified step-up this quarter third product. this remember, in at market So the a But the first in in first half the that really is haven't with the

either the a number. of given haven't the or eligible We the that's number population penetration direct on total

we I year, and next frankly, enrollment end continue think that expand of the the quite on you'll through season. see to year as into open get this and clarity through this us

Our comes Citi. question Grosslight of next Daniel from

my ahead. to Shield Just question. And And to on then bonus that? quick go Cross quarter? sorry, question is say Blue a quantify -- ahead. XXXX you Did the into I contributed Go clarification this actual Blue able you before revenue get are my

So Daniel, immaterial it was quarter. this to

going to quarter? Is it's hit Or it to revenue guidance? immaterial Okay. your next

It's immaterial. immaterial. It's

Okay. Got it.

Okay. about better. similar you Attrition And a year. growth is is your Jason, you bit I as pipeline were think mentioned where last then for revenue to XXXX,

XX% guidance, softening are in If should around see about slightly you you're year-over-year? year, step-down economy, a based likely where growth your on to BetterHelp XXXX we growth for a think rates which is at next 'XX assuming below

that. sort to tried components start you to modeling going that how we February. not the of we're to is to in We'll today. and do So that guidance do think give What give how of about

of And that. to than going I'm short stop going further so

and given about bookings impressive I've far, growth big billion, a thus drive bit obviously, we're how to far, I rates. it think the and the takes that's business, thus And at relative BetterHelp. quite lot to very those thinking a $X continue pipeline to a

comes from Anderson question from next Evercore. Elizabeth Our

Anderson. Virtual coming speaking light terms up is market in Any seeing the pricing of much? you behalf Elizabeth in Patel on are wondering, be what This just or Sameer I guys the was great. on not it so of First cheaper would plans? Is

really mean to terms, and we've I relative actually seen you what to in have -- you -- think I we and assume, what priced think year. exchanges everything the We the the I expensive in the like tell First I or exchange the the premiums the is this things is the products were that that is last consumer on You seen that for actually part What least were I end not can year that. pricing, of exchange. can buyer. tell Virtual -- And the in positive. yet exchange is fully the market end baked don't of

it's plan a terms. think ultimately, those that seeing Virtual benefits be I their a sharing cost richer in, designs. may a little but premium more, the it's demonstration that in First Because plan the are value is are because the bit of them all the less on meets consumers and

And has so very pleased looks plans. experience that year for 'XX head for so for we'll as like we're good. happens very But been this into pricing we with past see 'XX. actually the what And far, what

Valiquette from from Barclays. Our next Steve question comes

This is Tiffany [ph] on Steve. for

on more sentiment. employer the on if side impact what you you're was bit terms and DTC about of the could give macro think color the I I maybe BXB you in macro talked side. environment seeing on wondering a

Yes.

they And cases, think are bit a health distraction thing now base the managing managing in than their physical a among in of think remote little office of workforces more that responsible dealing locations executives both and, of their to with workforce and employee are we're who HR difficult are way. in the have only for inflationary a course, directly buildings. I we're seeing and many is about environment all different facing where benefits

a what employer -- I have the we bit seen that saw in X benefits caused first quarters, said slowdown to the quarter a I So a I with described I again, of a We is -- of bit distraction I bit think the in and more in as little said, like bookings. quarter leaders. among haven't think there's would that respect little just decision-making catch-up current environment. But third

And in that. quarter greater in and enabled think to to part break that the third of led so through some the I employer focus us that

impact significant on yet see a don't employer patterns. buying I So

that hard also to is that's in what there is pinpoint thing potential last business? recession. of is if The a recession, our was Virtual care to sort the impact really not to the around -- the extent

of So to history on. have lean a we exactly don't lot

Our Deutsche next of question Bank. comes Hill from George

cost company kind my looking of talked guess one question on got Jason opportunity Mala. I've Jason, guess 'XX outsized opportunities of opposed and the growth. about kind for one margin and revenue I to I housekeeping is, could as for feel then, aggressive you you focused into big-picture a lot Mala, do margins. is the rightsized on like be of like And And cost to would how a perspective? of be feel gross attack do you there from you kind just question costs? a kind

margin a If talked margins to 'XX, people attributed of little expansion BetterHelp. about of to we weakness see are the You that consumer talking see about that being in lot expect bit? revert would a gross for gross we some the growth

Yes.

So I'll take both, George.

would So in I sort what terms cost here's of say. control, the of

not does to current companies thing. conscious minutes a all as few at managing of look if new a it I are are adjusted about exception the ago, require costs. our more That environment, we no costs, And certainly be macroeconomic is always We We've our efforts you EBITDA managing for and that. talked increased control the beat focused quarter. that to expenses. We've the as talked on said about to we

the pleased are we results so And we've of efforts. those seen

being of multiple focused side the are date cost that on intentional equation. of initiatives We in the terms are driving to

So I'll give you an example.

underway streamlined. are make our of had and for months We we seeking to now, project a several several more financial systems where have efficient

real world about, we our are working colleagues estate of As our a footprint remotely. where consolidating talked a number large in we are

of that initiatives maintain. That's we have assessed, to we to the need of evaluated, examples X office many we space of We underway. and have the amount small begun reduce that just have

say growth say revenue XXXX. I clear, to not, about So be did rate anything we for really would

with XXXX. that need investments as top optimize guidance at an will it specific structure, to even when cost head will, ways, look make as we the more February. our we balance and for we conclusion, we will about I more how in looking right revenue at provide say, in the look will into and take to will we our do we growth. be though, outlook, thoughtful line But efficiency as We our specific drive we closer to QX are always, always, continue call to

well investments based to before, said enormous this line have for now not positioned the call a to continue in an that. growth that really space, go the said would those it have we do us there on to on we is As And until right we shame be to top are capture runway of make growth. for still and things all

and longer-term look will cost we at revenue it right optimizing towards always, looking for both our -- growth. investments making as the structure, So

Our Goldman next question comes from Cindy Sachs. Motz of

to wanted just chronic bit. to I go a back care little

well, guidance. a down client quarter, can go the judging and So in said that then up like bit. the of and you next with a it's bookings, by to And PMPM enthusiasm you're feels quarter we the as with that's little the lost going stable. sort it assume But maybe you

would I Is that So assume correct? rise. is going PMPM, think overall to that we the could

would have membership the on absent exactly not portfolio We members added CCM, loss. total in receptivity enrollment feel Mala chronic and XX,XXX where in the this CCM outlook in in called what we're out the would giving program QX. -- right. or We the on XX,XXX and market. client growth have enrollment been you're But is enrollment. one product overall care specific about mean I good revenue

the So we feel fourth good quarter about that, of sorry, quarter especially year. the the in -- in third of

next to CCM sort of growth look the as I bookings into we then forward. the gave look far think, continue we'll the year. year especially as and So And at heading Mala, outlook as general feel as we good, for

today. for was question the final That

So that conference for today's joining. concludes you Thank call.

disconnect. now may You