Teladoc Health (TDOC) 24 Oct 232023 Q3 Earnings call transcript

Good afternoon. Thank you for attending the Teladoc Health Third Quarter Earnings Call. My name is Matt, and I'll be your moderator for today's call. [Operator Instructions] I'd now like to pass the conference over to our 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

will a our and call, fourth remarks prepared During question-and-answer our full be and we will this by quarter also discuss followed session. outlook, year XXXX

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

that be other statements could call XXXX. the Health call. from those certain actual defined by expressed Such this during to differ results forward-looking materially and for factors subject Securities are as implied risks, note this Litigation Act in will Private or made uncertainties forward-looking that Also, Reform of the to statements please cause Teladoc statements

please refer information, which with available in of cautionary website. SEC, our and our additional For filings our press the our on are all statement release to

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

key thanks, our and financial strong pleased to and third us. guidance. everyone, report Patrick, you, exceeded This operating Thank a met that quarter joining for afternoon, or we're with results

poised our in than themes making value to ahead. continued want deliver comments Our performance reflect XX X afternoon, prepared in reflects my our today we're strength on delivering key the members. In years this success fundamental focus and health business and that the million to available our better the of to that more I

us operating results our our First, across sheet met guidance, industry. distinguishes that or and exceeded our a solid third balance strengthening financial key quarter

Second, services for strong. the products our remain demand and

bottom And globally prescription and third, for review disconnected health Health's care point viewing system. the a and in whole further care a I'll includes additional a comprehensive steps accelerate performance. taking business. With Teladoc what moment. more that concrete person fatigue business This solution payers operational talk to partners about line on we our largest are as the of means our

results. QX with begin Let's

earned during the the of revenue revenue performance-based efficiency year-over-year the large from second improving X% $XX On enrollment believe chronic in to Care part a Care or high on the result the year, of we of to our We a grew our by in structure, million. basis our EBITDA X% improvements to enrollment in consolidated million million Care leverage sequentially, EBITDA payments segment grew And inherent care now third $XXX users. exceeded over $XX Driven drive demonstrates a a strong programs, margin this our Integrated line, segment XX.X%, the exceeds our cost leverage of by quarter X% see $XXX continued that's adjusted in a driven efforts consolidated expectations. top X.X quarter, delivered margin of the quarter, the from revenue model. adjusted combination higher million Integrated the business to were Integrated where contribution active Compared pleased and end of year-over-year which grew our to as million.

the $XXX up recorded within to million provided and in range year-over-year Turning guidance BetterHelp, we revenue the quarter. quarter, X% of last

near revenue balanced year's seasonally of a better our BetterHelp. return since the landing last that have quarter prior the means means improved track growth in midpoint midpoint with that costs to which our over helped remain anticipate range, the trends, and we on and billion meets of This prioritize to Customer the continue guidance near nearly growth prior approach BetterHelp. quarter, surpass exceeds After to BetterHelp we'll we our outlook year, margin growth basis and typically for for margin third margins year XXX or is fourth scaling stable strongest deliver full profitable more again acquisition combined taken at EBITDA margin material we're revenue quarter gross $X requirements. for quarter, rapidly segment Third points to of

thinking I client key so second to selling whole theme out The X I'd care want where the remains solution. season trends. our is person strong far, cover environment demand, call for the In about

the First, while Through ahead channels. represent our and We're quarter, point Care there moderately left in third line same year. over products incrementally are bookings the tracking point strength year-to-date, the year, last we're from year. are bookings that in total months to last Chronic the seeing half pleased to of still key up of X go all in same the our end sales of across over just U.S., the

a seen we've sales bundled care chronic to single point. person price whole our increasingly in solutions. access Next, enrollment via particular pulling at multiple chronic through success bundled care and selling programs We're

bundle friction creating day all Diabetes our programs, and For This chronic access Plus driving outcomes and contracting to hypertension opening path, by enable engagement our removing care example, of simpler management. clients. programs X and management, benefit better clients multiple diabetes from the for weight a has purchasing to access

by than unlock And Americans us chronic client, the meets multiple X/X more also the where conditions. to to are It diagnosed number of economics. they delivering value enables more better it with with

faster than X/X person XX resulting in program whole more Over chronic growth solutions. enrollment XX% drive of of helped total bundled past our the deals chronic program care our adoption year-over-year. That's months, included

of some cases, a takeaways. are their within growth direct This not models weak with we're clients significant sheet. fallout balance from and result Finally, we only deliver existing client but struggling our in for base, business seeing unprofitable to also other players is seeing competitive

care competitive added quarter, third we the During X million our virtual to nearly takeaways. lives programs in

validate also greater clients our our is we that business that value members, the unlock performance. While results potential season there delivering still we're QX selling and and recognize for even to

for flow. foundation and growth, increasing efficient cash generating and a durable built We profitability strong have

growth You've top material and lower heard approach drive demonstrating that us more In we're XXXX, a can growth. balanced growth flow cash and we line free talk margin. about EBITDA rate to a despite of

performance, to EBITDA improving on segment. and confident expansion, bottom continue a line we can few focus continue years. us deliver There to that confidence care margin in EBITDA our integrated will are We and growth a of growth the particularly level over things high significant within to free ability that give excess few flow deliver revenue of in the well next we're cash

following First, the of transaction. exiting elevated a we investment are Livongo period

like top operating line. drive grow leverage that expect we the this moderating many over Integrated allow will wrap As projects up, to material cost launched our we our app us as year, costs structure

have the we focus on Second, improving XX broadly sharpened months, organization. our across efficiency past the over

our bear the own believe seen this to EBITDA You've which those the cash consistently reflects we and driving We're drive as today, will efforts future. value fruit continue three. begin which today the disappointed have me stock the don't leads we and flow expectations, year are valuation adequately with the to free in of exceeded to

business. broad time, know through business to the includes a significant we same add of performance. off components. operational opportunities also the To are improved value there comprehensive review review At we end, X This recently that kicked

across assessment whole-person care to our our the selective our prioritized highly identify the any First, sharpen in and we portfolio opportunities strategy. investments ensure undertaken have integrated focus and and portfolio remain services direction a of products to of

cost comprehensive we structure. a are review our of Second, pursuing

our are efficiency. in upon that right phase the improve growth. operating have opportunities cost working place reduction to are actively support Meanwhile, year, Following confident of operating we this to this we next earlier our the efforts identify we structure to

across exercise, the that a of that part a standing structure. centers we as efficient to example, business up enable excellence of For shared have leverage more services operating begun will

to We In party short, efforts bring and are working to a we revenue are level that independent that business drive growth profit at next is as in growth perspective. possible, operating years. thorough and review committed we as the are to accelerating than over a a an meaningfully few ensure our with third efficiently our is to higher analysis our order

are for scale. this will digital while And market operating Health fully caring our our the promises that details keeping our more this to as we the taken will these is the do We leverage tapping remains by quarters. a that in centered forward We look at and health business in at do our sharing no leader on the differentiator or members. efforts to that on our coming efficiencies ensuring mission clients for expense Teladoc of

And the quarter guidance. with turn third review call that, I'll over Mala the to forward and our to share

afternoon, Thank you, Jason, and good everyone.

Third of $XXX X% million increased consolidated quarter year-over-year. revenue

of $XX.X was margin above EBITDA representing end XX.X%. of quarter million Third our guidance a high the range, adjusted

of acquired $X.XX share per and the of was third Consolidated of the net $X.XX stock-based per XXXX. in $X.XX net in a in share. expense per loss of of loss includes loss to third per quarter amortization compared $X.XX, compensation share per the quarter third share Net share intangibles quarter

the million XXXX. was the free cash and quarter Third in billion on quarter balance the third $XX $XX quarter compared flow of cash sheet. We over million in $X with equivalents ended to

Turning primary growth revenue largest a chronic the of to to in was basis, PrimaryXXX. the in by third the The quarter, contributor X% care to sequentially. segment million enrollment programs. segment Integrated Care contributor growing results. Care, care Care revenue Chronic Integrated $XXX integrated followed On increased sequential year-over-year to segment X% ramp-up growth year-over-year was

with over bringing total ended care chronic a sequentially. XXX,XXX. enrollments care enrollment XX% growth X.XX quarter, an XX,XXX quarter programs, added the enrollment During million, new we increase in X% third and chronic to year-over-year net of We of the year-to-date

Care followed enrollment management new XX.X the our approaching enrollment weight been of primarily selling program a In was mark enrollment, this XX% has during ending Program year-to-date during result year. the Significant competitive prevention the have added care enrollment is bundled growth by total, during large of the the X million. by Integrated management which takeaway third solutions. have drivers quarter members which hypertension, bolstered care our diabetes quarter, each success total at million biggest chronic over quarter. crossed now a and our chronic XXX,XXX membership programs. in The growth segment been of

sequentially. of the Average was per increased $X.XX U.S. year's integrated $X.XX over revenue prior and quarter care member flat

during Excluding the large increased the per revenue sequentially. quarter, member third new population $X.XX added

improved expenses. and line. Integrated adjusted higher earned expansion by That G&A quarter was gross the an was XXX on operating expansion quarter, Again, margin $XX.X Third basis driven EBITDA margin revenue, third quarter point the prior efficiency, to increase margin driven a representing by Care increased margin during revenue an the most G&A subscription the our due third line. was primarily The performance-based of on year's performance million, guidance particularly mix versus notably quarter. in lower over

of to increased users monthly line X% in to BetterHelp. decline Turning increased quarter. $XXX Revenue third the the range. with over X% million quarter, year's Average guidance in sequentially, X% year-over-year a our prior

represents This X.X%. stable to adjusted was XXX the gross increase BetterHelp EBITDA reflection third sustained a compared a margin improvement. environment as in as resulting more well quarter a of quarter, million, year's the prior of Third last basis year $XX point margin over advertising

turning forward Now to guidance.

to year-over-year of $XXX revenue growth points. year adjusted $XXX consolidated million, full million now to million, improvement basis representing be We range in our EBITDA expect expect of X%. margin be XXX the from cash of the representing flow XXX to full year We now to approximately expectation of million. approximately up to X% approximately of to billion, expect in $X.X range full $XXX We $XXX $X.XXX prior free of billion year

we quarter, million. range in of the be to to $XXX $XXX fourth For million the expect revenue

low our revenue Integrated is percent the our in mid-single-digit growth fourth year-over-year to in growth segment. quarter Assumed and high outlook Care in segment single-digit BetterHelp year-over-year

in spend the XX.X% see we growth EBITDA the not as to expected rate thing ad results year-over-year half quarter we've that of adjusted previously growth the of comparisons is weighted the year-over-year be advertising Integrated quarterly Care discussed detriment heavily $XXX and for cadence the would in to million second of range assumed XXXX spend change margins is half margins EBITDA the the the between XXXX fourth in Fourth The of, first that and the BetterHelp reflective between fourth This million. BetterHelp you quarter expected consolidated segment segment quarter to year. do the year. $XXX underlying in first business. of of One XX.X%, half the cadence more than and is BetterHelp favor remind fourth of outlook adjusted which of XX%. quarter in XX% the the year I last to in Therefore,

high the year, low the likely are a modest of revenue the of half you assumed throughout the range in revision at prior acquisition the Recent lower at the believe customer that the in of cost through discussed the trends our guidance high the within the in outlook range. of guidance. And end that We persist in As of albeit range. improvement year-end. an costs acquisitions to initial range of end deterioration continue our trend end range, see to reflected customer and this

back With that, I will turn to the call Jason.

Mala. Thanks,

to so much Before want do to share we we of tragedy the recent some work are go days. wake proud of particularly I questions, that in in

may at affected have heard, therapy in no to cost. applies is by by the the support and Gaza war Israel anyone you As anyone impacted offering anywhere. to BetterHelp war The

you know, of offers no those impact some in to As Health through program. our therapy cost Better need frequently at social

responded In Ian, other shooting Maui the Ukraine, the to and the Hurricane Midwest past war flooding the among have Robb fires, XX months, we crises. in Elementary

great contribution such to now, suffering. BetterHelp no I'm at pleased Teladoc answers can that time positive make a Health While one right of a healing all and has right the

open Operator? With it questions. for we'll that, up

first from of the The line Gill is [Operator Lisa Instructions] JPMorgan. question with

parties that, Integrated have time say thing you people. about I to just I I integrated today had basis, said X business I positioned the number just really that's offering. you about competitiveness I want are fairly is go-forward on significant wins business? I'm few from, those areas, really things. Can you that's asked million saw on quarter. a this over the your maybe always talk How a to difficult what Jason, shifted the marketplace margins you around to we in this to but sure I that want were side other can to on that selling you're you single you're that thinking lives you know a you saw know focus a a the that X don't The think wonderful talk your how season? who solutions? focus that about you really the The X we the Care. about season, competitive feel Just of took me name in selling have the to about but Integrated how for to point you do. you? want Or especially forward? on lives of do competitively, going and million

solutions with that, thanks for that competitive Lisa. else work the power I comments the really speaks Yes. differentiated I about and of in bundled the the our offering No, of significantly thanks, I market. appreciate the anyone selling landscape, to breadth the on If is think BetterHelp. think incidence how our from us of and

the we've of management care majority about, services. as our the As our of majority talked the sold majority -- solutions of of and chronic chronic care management programs our are make up bundles bookings,

also existing clients. services we those sell cases, by products solution or of those In where significant into adding products our wins additional very single-point into narrow many more replacing We're clients. and seeing solutions we're

And concern. and come record or wins we track so success quite is X or I day. wins three solutions either that the an someone faltering a all our raise a have frankly, the environment client. sustainable. would and proposition where struggle business them they proven a that of operationally bundle in model our categories: an we're creation of -- isn't as And One this terms quite into economic say our frankly, dimensions replace products our single-point And capital competitive is current seeing where replacing sorry, solution because with we're into either economic a of existing at failed exist and to model additional that and/or clients of is who, do value going Two value the -- in clients, selling by for competitors the have have is where really

be largest we step So not this to the quarter spoken and make with and kicking our we have at into those. and saw that the tires competitive one I to who sure partners I sheet seen think really was quarter, I balance And where and them. represented grow we win financials. our And to that but fail, the said going latter, to able are with be them. of speaks just Mala able The and engage never many biggest competitor the CFOs a X were the to and strength the last strength here, the of that all we've replace really so future in are prospects, today they think to of clients

maybe question The that? of first or question about to your second do of was Mala, the margins. you Care part part want to your Integrated speak

Yes. I'll that, Lisa. speak to

the had at our and sizable prepared factors XXX look stand and back XXX have basis margin basis points. and look So Integrated points margins. Care Integrated we if Care both take at I you in across expanded few Or sequentially, performance said if look quarter, a at it by a over we that where, out. remarks, vis-a-vis in I it step year-over-year we in pretty third are improvement as our even where a drivers There our

We've is in that it all, to we pull through from revenue are seeing of quarter, fact So about, are we gross has First nice talked our a growth in book, we margins PrimaryXXX. care that. leverage that a we've growth right? third as talked care chronic the across chronic and seeing that and the both in about more saw balanced also the way

the side. Care in the revenue So Integrated of that we're seeing growth pull-through

already cost seeing cost are our and programs we efficiency year. place of the We put this controls have the results in that

We his where we review as an to certainly, we And efficiencies. Jason our cost at in the as are seeing business, to that. -- drive benefit talked areas operating remarks, look we can prepared will look of about the across additional

that So theme. a be continuing will

really million $X points. of from the we have had, in of expansion, we at basis about if our our It's remarks, XXX look you we in performance prepared the talked was That to we outcomes our margin as overall about -- was that because contribution Look, that driven. guarantees -- about it benefit. was also recognized amount some about

the if it we that. revenue it focus on that to continue mix. we really is And you will margin the the driving is what's have So look expansion, efficiency put in programs and place, at cost

with Next Ryan Daniels question Blair. is the of William line from

One for of you on chronic book the care business.

hypertension. I weight in growth and think you and management. strong about It's XX% diabetes seeing mentioned

on longer-term that unfavorably to the So market. coming to or your are the curious potentially thoughts all business from what impact GLP-X data that's favorably

Thanks, Yes. Ryan.

we that -- from impact impact material to the that, take As future, really we being said to earlier are weight year, us and have think well diabetes in We year. expect engage this anticipate living and as in year announced GLP-Xs the our of of that the programs. program will don't participate benefits the we for earlier launched as financial new the and any in with people for advantage we in able who some management who people for diabetes prevention with of an

So for the us we see as future. that off paying in

that the to frankly, We looking the market also is cost especially this, engaged those us for very of and medications. see, quite our are solutions clients of in because

when whether I the to reality going some that's of on to loses has an collectively Yes, be with headwind. GLP-Xs say the to with I respect and costs the going the With GLP-Xs. engages that would people a I where analysis saw probably were airlines respect recently hype ahead country weight. gotten save I said to the fuel think mean,

this a point. overhype think bit to of I at that little gets maybe

include Well, think wish increase don't that I increase the expected GLP-Xs of is of maybe over health engage next massive with with think respect activity, growth. to XX need in year-over-year solutions see I I that to and moderating but a to it years. suddenly continually have weren't by and rate an really can impact case, respect respect the more we're mental diabetes don't think, behavior seen change nutrition, to in the care. XX% I We've in to comprehensive the to with that on decline people for prevalence going

don't and and back going And a see a I programs, really, And programs headwind. my the also them the them as initial really that cost as to of in the clients take help those context manage it to of think again, overall enhance think so need GLP-Xs comments, those for -- you engage our the I to tool them. in medications to we but view cost we have of

from Truist. Jailendra the of next The is with Singh line question

we qualitative But understand give X year? I XXXX was and color I color we margin additional XXXX wait a mind think we revenue earnings detailed keep to next Or puts on could wondering until QX and call. should across guidance those trends? any need you if any about as for takes directional or in segments

say hand I'd and of Mala color. guess some then for couple I it Yes. a things to

I And the our say that can expect expectations grow can our you true us to of years. us next revenue heard you that's part is certainly than expect what of will our today -- EBITDA for couple you think for faster XXXX. see hold or that

think heard we selling about to at year us Care, Integrated modestly in for the I last were line where being you today ahead season talk of time. this

We of late-stage we flat couple season. the where year. was our And months have left this to see a in pipeline relative still it selling pretty

least at of be. segment you our give Care should that Integrated color relative to where a little will So bit

And be the XXs. client in retention continues there to

So margin that than as there. the you growth quarter that of balanced And say on side, to I more business. we shouldn't there. historically view no think material had take being heard revenue growth and And of we the that Mala underlying indicative a to you fourth approach BetterHelp the continue then change

point. -- giving I this are to short, expected guidance those going we're So XXXX think at stop the of as you

in miss that do But the did I quarter We anything that into should we'll expect first of components go there? those ingredients outlook. next your year. think the are I and Mala,

think I little a add X more starting just would the for color about Thinking XXXX, bit point better about things. health on I Jailendra, specifically.

times talk year. when think you as as -- lower it's ad as about about And comp about year-over-year rate the last until quarterly it relative would growth, differently the the now, We think spend I quarter, first line than quarter the so if the as several and very up right? the run well -- year this revenue think they I year-over- run this above comp, have due said rate, to up fourth comps, to true of

spend Just This half as is all of of year. the place Last year. half. cadence it's the that a half in very versus the year year spend the second going year, took be ad spend opposite ad was to taking reminder, what year, the different over the we've this with half in been of first the saying last place

that's So of in to the sort thing first mind. keep

thing second year and last about The full period year business has on that's basis, say of this happened pretty our is as It's the you is bigger short a time. per right? I'd revenue just for think BetterHelp if business today. few simply years, a each reasons, rapidly a guidance has over One a scaled decelerated much over X

loss numbers at it annually. just you're rates not continuing growth those to So hyper to going grow large see

as The we managing the Jason talked second just say thing business is, I'll are about, differently.

We line line and flow. as cash are balancing growth growth top bottom as well

at lower on an driving that is, and margin. growth. rate certainly, instance, is to a has that And come increasing in focus line ROI overall balanced going approach So top of

advantage. And and then the our virtual last mental is spend, enables advertiser of on us if this far, at and largest scale real And to we unlike in look the that our us virtual mental the returns which player gives space business, a are point health. strong smaller drive also our largest peers, you earn is, the of health by many DTC

growth and before. any time. the can grow. incremental acquisitions channels of in only every much to this and But more themselves shifts ad period short about drive that talked towards you There's spend just more and market so as year virtual the customer as there's a have We natural

profitably that year business So DTC grow amount limit year. of the can does after

just that we dynamics this business. certainly to So all to color some BetterHelp of the the are in seeing blend

question next is Richard The of SPX Canaccord from Close Genuity. line the with

You more details more being this bit investments of you're a like sounds big you're to about how But I change it is just going little maybe forward? thinking compared about it. years? how -- And restrained. past talked a on Jason,

gets what of maybe examples curious just I'm priorized? So

A Yes. there, of Richard. couple thoughts

during think to from last acquisition. important years. of I building from the where investment of the We're it and first all, it's effort context cycle put in spent Livongo time lot we've come of a significant emerging integrating we've of over a couple post which and

areas across now sense the to that is to part greatest I it but also we for to our of get performance. to business the are so And investments going return, makes where the look strategy. organization of enhance not only the focusing further And our the bull's us eye think ways for closest of on center

I progress in think that also, the you'll continued software. on we're capitalized making see

also seen move get more in And year quite but to next that again that this chunks year. forward. that and on see I think have you'll investments You've this investments we into big foundational as to focused the point, less put frankly, move for us helped platform place us to

app. Integrated our with that seen You've

systems. financial migrated seen of internal our and that You've some we've ERP as

see put true enable us place deliver a in the on as experience integrated for to of capabilities some that we You that PrimaryXXX.

in also And sure to differentiated that manner, making we're on delivering focus judicious that return capital so continue whole-person delivering making a care but the we'll spend. in that sure on we're

line the Charles Cowen. is TD Rhyee question of with from Next

from you give us these or enable structured these and least This from payments? you related positive can to Charles. generating Integrated are about them? engagements can segment onto earn how outcomes. to you assuming value-based that for then What Lucas recognize sorts I'm ask performance derived the I your to a you how on is recognize want portion guys' performance guarantees of of Care from value-based this at is arrangements that is And arrangements.

in run Care of the basis, segment amount would revenue. outcomes the rate tied Yes. of question. Thanks on Integrated of total revenue The the be for our is, way I would it performance-based to clinical single-digit think percentage a

performance is a size just And clinical give have the we sort on to long other against I some thing these of would of dimensions say So history of you measures. the that.

We lot feel support outcome our data of of perform to have We terms to these a ability our against guarantees. in analysis. very comfortable

we revenue. that revenue it's an percentage approach just in said, performance-based of take finally, recognizing relatively And small a our I believe also today. As appropriately conservative we

have So our all it to small this used some percentage revenue we contracts by it time, overall book certainly a that relatively to against is of work delivering of is data. And for say been today. supported

The next with the of question is from Bank. Deutsche Hill George line

membership a gave business to on I line kind that for you so the a balance where just because don't the then, way for like about Jason, a with broad I like guess would I guess, guided I expectations perspective the it structure. Mala, of the I from QX past guidance And about inside to that would is wants question you of the would that now in there's way a year? ask, the know in what cost of QX. have the of is any thinking the quickly month My BetterHelp. guys you of question have approach like pretty order basically you're close, cost-cutting to that we're for kind recognize opportunity magnitude to if program. one size And a I company be tracking looks sounds be

Yes.

we that I'll then one And George. where talk first, Mala are. can maybe take So about

is. we're The right a I into maybe short is quarter, -- month where answer in I'll the line with actually, our think guidance that take it.

can I take So Mala. that for

that to comprehensive our our our ensure strategic with respect growth to maximizing with is do across everything really review, profitable the looking opportunities. operational and portfolio we're we think I focus aligned

things really efficiency, where like our all management excellence the areas focused drive make on for of and such can we operations, client we're member investment. up purchasing, and scale advantage cycle emerging of stood and we opportunity take for from a of I operations, chain supply clinical we that are before, to now centers think leverage operating efficiently. I period these revenue more we've and greater significant operations, can efforts of cost that operate mentioned the efficiency sure business out driving are

to it regarding And really profitable the of growth. so for reduction to business expect. expect the anything to more in middle And don't as announce we're you on fundamentals the contributing And year I earlier us quarters opportunities at is next took more today to help think have then I to We in are of right a performance the we rate improvements our to it. you what as revenue magnitude opportunities earlier, of described that what tie organization that, than the that that the of come of that faster we color that EBITDA parts we the sure and the on us growing right-sized cost efforts make think sense based over at all now, makes which can years. look to this give and a those that really you the is we couple quantify assessment

strong expense we add about of last gross think would our things and and at. margins Think I The better improvement, say the would the to has there. also thing that initiatives gross is margin I help operating have one a would about margin talked which look contributor and we been I we about the all gross seeing margin if expansion. are

be We therapy, interactions. are and productivity, digital steps it to taking to whether initiatives improve more therapist group

as So it's, I as expense. would say, across margin both gross operating well

Piper with line from of the Sandler. is Tassan The Jessica next question

to a years. a and to basis? rate of mid-single BetterHelp -- I'm digit to for So target EBITDA think that mid-teens of new still consolidated on revenue Integrated growth being cash grow think as as the should we about revenue for couple the high be curious, kind new guidance? over low Or about you Did than we guidance faster should sort thinking flow that those revenue against double different Care and next single long-term free digit growth of about

Yes, Jess.

segments. guidance haven't business the the given as we or So longer-term for whole a

see out first you'll 'XX. quarter think an in the outlook for come with 'XX I us of

our to faster see outlook is probably years than that given the we've last that I several in expecting of revenue next the quarters. EBITDA think, quite given indications the growing for today about longest the we've -- couple frankly,

numbers what because I from outlook. to But acknowledge think will us the those longer-term are as that don't more you I multiyear findings more longer-term And to. this want solidify we give feed a view I recall when into view. of we're a endeavor and results to a we'll review, or operational validate ready giving don't

Next Daniel with line Grosslight question is from the Citi. of

integrated on care couple a and outlook the of have the the just for I margins year. remainder

basis if Integrated would of lot correctly points XXX around around So fee. for of for degradation, performance be XX% midpoint, XXX you points the Care, at I expect basis the you margin which heard

degradation that? points sequentially. driving of So still XXX I'm basis what's around talking curious

now XQ around what's you And outperforming then there. points thought I then guidance, it started full that implied basis that margin the guess XXX kind the to points, change think if XX to I we when significantly it's XXX by flat I look XX, it's of you expansion of at year, year, versus would basis and be up

put point just So there? we forward a finer 'XX? that in the you expect maybe and should on And could if fiscal what outperformance going

Yes. question. Daniel, Thanks, the for

out about margins. given the have in XQ think decrease I'd Care, guide are few Integrated there factors if say, driving for you exactly, So said, that as a you we the

the as fourth So always margin increase. cold what that, and gross flu quarter right, is as know, visit season, drives and you are First, the compression, those? volumes

a So factor. that's always

member have also talked -- in are you spending right? onboarding, we we've strength We the As ahead about bookings. of know,

Jan We have several starting X. member onboarding

of class say We continue hires. to physician client the in of launches. quarter. And so grow we those also our W-X are ahead we fourth spending will I would do

our will WX increase We roles.

that to third guarantees certainly, certainly drag is, you And is margins as say last the margins, small about a points you performance the sequentially. quarter. that the noted, I So as would the has to XXX -- quarter during an and the impact basis contributed thing mentioned, certainly

we quarters. strength second efficiency we the And seeing has it have few that performance thing talked few what why over the the are. big the seeing consistent have we the has seeing as we certainly, minutes our really guide. On program last cost about is the Jason of that your those is comes growth. I we around are And and in when we that been seen. margins. revenue It expansion a X on theme down full second and around And Number in question one year past themes. chronic That the the strength to are care have through And of all exceeded gave fruits year. initial the are the expectations rolled

X So margin we through outpace it's us things year. rolled to the expectations allowed that those as really the have have

seems in 'XX achieve fiscal Makes shot around right? what efficiencies then You in follow-up. like, versus that margin anything, sense. that to points, to well. if might are is maybe a going basis you're more going I'll XXX, operating It 'XX, XXX expansion you just And as which 'XX take got a get at through. roll

Care some Integrated other And the on spend App. less

So you XXX I'm we just about going for should basis points of the margin of curious, guys? kind expansion as XXX, forward floor think

But of 'XX, into a short margin definition, fact I giving by from the we expansion revenue, We're margin give away 'XX we'll as that, are again you in of and think than we that guidance. expect you of more insight take magnitude into the expansion. that stop grow that the get going magnitude to to EBITDA faster can targeting we

from Next question of ISI. Anderson line Evercore is the Elizabeth with

get that think on. that per care Has health the I wanted Or to per geared we inflection as about if to and well. well. of couple BetterHelp and roll of bunch ramped? therapy a should quarters? think had right just over pricing kind that how a as think on obviously, ramping think question we next think about those I way new to that's is that nice come the user as obviously, the in and so And about average side members up integrated something of it? the understand, about of member? month had a you then had Care revenue then U.S. should revenue not per Integrated maybe about of something And sort members is Like we as sort BetterHelp you of

that to how just forward. of kind the as So we cadence think of about move

activation members describe more that With Care, than really a those a onboarded revenue that The Integrated pricing but of course, question. stable increase to really It's in to per visit just revenue activate not we always revenue. thanks can respect pricing stable. would revenue it's and stays describe so of the tends revenue for have Elizabeth, because of environment per I And question for to member question. we we as Yes. would member. -- I members the subscription drive to ramp. question. visit we the land an a then, over expand pricing look engagement more opportunities time, That's our and

I about or basis it stable. apples-to-apples it from pricing, when X and products we're the bundle an next, So think a of year either I a to pretty of seeing single think product as for

overall, markets. notable With across respect hasn't changed BetterHelp, pricing experimenting we're to in always But a with pricing way.

you're and but small the count, a versus within growth impact a which the the there's really sleep or And when user mix, seeing mostly small off come there's including looking quarter impact you're of you're reflection of is of a if asset, item, is any of growing importantly, period-to-period quite roll primarily timing think and/or I in looking for change at start when at a divided program. revenue by line membership, faster. of other the DTC revenue paying bit the then on quarter program that's a members of

pricing So I say market. in pretty has overall, remained stable that would

Dodge with RBC line The is the next Sean of from question Capital.

but customer kind provide you you BetterHelp, in payments resumption seeing a Is what earlier any there you're X. the October on any impact Jason, BetterHelp? having change or or of can on churn kind on at behavior? least new response, around just loan in on in just, of guess, potential thus alluded updates to far with it I of mean that's general, into adds discernible October? Any bit I

seen stable. haven't anything that's Churn in been had that, suggests We the an impact. that data has

change, any in We haven't seen our significant guidance. in notable are significant churn we assuming nor change

say, really So that. we I would impact no, any haven't seen of

for question. for Thank Thank call. conference you your conclude your the participation. you That will

lines. disconnect You may now your