Amwell® (NYSE: AMWL), a leader in hybrid care enablement,
today announced financial results for the second quarter ended June
30, 2023.
Amwell Second Quarter 2023 Highlights:
- Recorded Total Revenue of $62.4 million
- Achieved subscription revenue of $28.0 million
- Recorded AMG Visit revenue of $28.1 million
- Reported gross margin of 39%
- Net loss was ($93.5) million, compared to ($398.5) million in
first quarter of 2023. Net loss reflects non-cash goodwill
impairment charges of $27.3 million recorded in the second quarter
of 2023 and $330.3 million recorded in the first quarter of
2023
- Adjusted EBITDA was ($45.3) million compared to ($44.6) million
in the first quarter of 2023
- Total active providers were 106,000
- Total visits were 1.5 million; visits on Converge grew to 43%
of total visits, from 36% in first quarter of 2023
- Cash and short-term securities as of quarter-end were
approximately $458.7 million.
“The second quarter of 2023 was another solid quarter for our
company. With most of Converge development behind us, we made
progress continuing to migrate health systems, and payer migrations
are underway,” said Dr. Ido Schoenberg, chairman and CEO of Amwell.
“We expanded our list of strategic clients on Converge, and our
automated care programs are resonating in the market. We are also
putting important strategies in place, as we work to reaccelerate
our bookings momentum.”
Financial Outlook
The Company revised its guidance, which calls for:
- Revenue in the range of $257 to $263 million, compared to
previous guidance of $275 to $285 million
- AMG visits between 1.525 and 1.575 million, compared to
previous range of 1.45 and 1.65 million
- An Adjusted EBITDA range of between ($160) million to ($165)
million, compared to previous guidance of ($150) million to ($160)
million.
Other than with respect to GAAP Revenue, the Company only
provides guidance on a non-GAAP basis. The Company does not provide
a reconciliation of forward-looking Adjusted EBITDA (non-GAAP) to
GAAP net income (loss), due to the inherent difficulty in
forecasting and quantifying certain amounts that are necessary for
such reconciliation. Because other deductions used to calculate
projected net income (loss) vary dramatically based on actual
events, the Company is not able to forecast on a GAAP basis with
reasonable certainty all deductions needed in order to provide a
GAAP calculation of projected net income (loss) at this time. The
amount of these deductions may be material and, therefore, could
result in projected GAAP net income (loss) being materially less
than projected Adjusted EBITDA (non-GAAP).
Quarterly Conference Call Details
The company will host a conference call to discuss its financial
results today at 5:00 p.m. Eastern Time, Wed., Aug. 2, 2023. The
call can be accessed via a live audio webcast at
https://investors.amwell.com or by dialing 1-888-510-2008 for U.S.
participants, or 1-646-960-0306 for international participants,
referencing conference ID #7830032. A replay of the call will be
available via webcast for on-demand listening shortly after the
completion of the call, at the same web link, and will remain
available for approximately 90 days.
About Amwell
Amwell provides a leading hybrid care enablement platform in the
United States and globally, connecting and enabling providers,
insurers, patients, and innovators to deliver greater access to
more affordable, higher quality care. Amwell believes that hybrid
care delivery will transform healthcare. The Company offers a
single, comprehensive platform to support all digital health needs
from urgent to acute and post-acute care, as well as chronic care
management and healthy living. With nearly two decades of
experience, Amwell powers the digital care of more than 55 health
plans, which collectively represent more than 90 million covered
lives, and many of the nation’s largest health systems,
representing over 2,000 hospitals, have access to Amwell solutions.
For more information, please visit
https://business.amwell.com/.
American Well, Amwell, Converge, Conversa, SilverCloud and
Carepoints are registered trademarks or trademarks of American Well
Corporation in the United States and other countries. All other
trademarks used herein are the property of their respective
owners.
Forward-Looking Statements
This press release contains forward-looking statements about us
and our industry that involve substantial risks and uncertainties
and are based on our beliefs and assumptions and on information
currently available to us. All statements other than statements of
historical facts contained in this press release, including
statements regarding our future results of operations, financial
condition, business strategy and plans and objectives of management
for future operations, are forward-looking statements. In some
cases, you can identify forward-looking statements because they
contain words such as “anticipate,” “believe,” “could,” “estimate,”
“expect,” “intend,” “may,” “plan,” “potential,” “predict,”
“project,” “should,” “will,” or “would,” or the negative of these
words or other similar terms or expressions.
Forward-looking statements involve known and unknown risks,
uncertainties and other factors that may cause our actual results,
performance or achievements to be materially different from any
future results, performance or achievements expressed or implied by
the forward-looking statements. Forward-looking statements
represent our beliefs and assumptions only as of the date of this
release. These statements, and related risks, uncertainties,
factors and assumptions, include, but are not limited to: weak
growth and increased volatility in the telehealth market; inability
to adapt to rapid technological changes; increased competition from
existing and potential new participants in the healthcare industry;
changes in healthcare laws, regulations or trends and our ability
to operate in the heavily regulated healthcare industry; our
ability to comply with federal and state privacy regulations; the
significant liability that could result from a cybersecurity
breach; and other factors described under ‘Risk Factors’ in our
most recent form 10-K filed with the SEC. These risks are not
exhaustive. Except as required by law, we assume no obligation to
update these forward-looking statements, or to update the reasons
actual results could differ materially from those anticipated in
the forward-looking statements, even if new information becomes
available in the future. Further information on factors that could
cause actual results to differ materially from the results
anticipated by our forward-looking statements is included in the
reports we have filed or will file with the Securities and Exchange
Commission. These filings, when available, are available on the
investor relations section of our website at investors.amwell.com
and on the SEC’s website at www.sec.gov.
AMERICAN WELL
CORPORATION
CONDENSED CONSOLIDATED BALANCE
SHEETS
(in thousands, except share
and per share amounts)
(unaudited)
June 30, 2023
December 31, 2022
Assets
Current assets:
Cash and cash equivalents
$
161,356
$
538,546
Investments
297,326
—
Accounts receivable ($91 and $2,597, from
related parties and net of allowances of $1,838 and $1,884,
respectively)
48,399
58,372
Inventories
8,532
8,737
Deferred contract acquisition costs
1,534
1,394
Prepaid expenses and other current
assets
18,294
19,567
Total current assets
535,441
626,616
Restricted cash
795
795
Property and equipment, net
586
1,012
Goodwill
79,421
435,279
Intangible assets, net
134,953
134,980
Operating lease right-of-use asset
11,770
13,509
Deferred contract acquisition costs, net
of current portion
4,520
3,394
Other assets
2,197
1,972
Investment in minority owned joint
venture
2,493
—
Total assets
$
772,176
$
1,217,557
Liabilities and Stockholders’
Equity
Current liabilities:
Accounts payable
$
4,521
$
7,236
Accrued expenses and other current
liabilities
42,581
54,258
Operating lease liability, current
2,932
3,057
Deferred revenue ($706 and $1,665 from
related parties, respectively)
60,214
49,505
Total current liabilities
110,248
114,056
Other long-term liabilities
1,645
1,574
Operating lease liability, net of current
portion
9,995
11,787
Deferred revenue, net of current portion
($4 and $10 from related parties, respectively)
6,600
6,289
Total liabilities
128,488
133,706
Commitments and contingencies
Stockholders’ equity:
Preferred stock, $0.01 par value;
100,000,000 shares authorized, no shares issued or outstanding as
of June 30, 2023 and as of December 31, 2022
—
—
Common stock, $0.01 par value;
1,000,000,000 Class A shares authorized, 251,076,995 and
244,193,727 shares issued and outstanding, respectively;
100,000,000 Class B shares authorized, 27,390,397 shares issued and
outstanding; 200,000,000 Class C shares authorized 5,555,555 issued
and outstanding as of June 30, 2023 and as of December 31, 2022
2,834
2,766
Additional paid-in capital
2,204,387
2,160,108
Accumulated other comprehensive income
(8,869
)
(16,969
)
Accumulated deficit
(1,572,777
)
(1,082,028
)
Total American Well Corporation
stockholders’ equity
625,575
1,063,877
Non-controlling interest
18,113
19,974
Total stockholders’ equity
643,688
1,083,851
Total liabilities and stockholders’
equity
$
772,176
$
1,217,557
AMERICAN WELL
CORPORATION
CONDENSED CONSOLIDATED
STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS
(in thousands, except share
and per share amounts)
(unaudited)
Three Months Ended June
30,
Six Months Ended June
30,
2023
2022
2023
2022
Revenue
($983, $1,163, $1,971 and $2,377 from
related parties, respectively)
$
62,447
$
64,516
$
126,448
$
128,748
Costs and operating expenses:
Costs of revenue, excluding depreciation
and amortization of intangible assets
38,244
36,497
76,996
73,262
Research and development
25,842
37,067
51,765
74,548
Sales and marketing
21,554
18,721
44,280
39,875
General and administrative
36,319
34,911
72,689
67,627
Depreciation and amortization expense
7,718
6,724
14,961
13,322
Goodwill Impairment
27,276
—
357,585
—
Total costs and operating expenses
156,953
133,920
618,276
268,634
Loss from operations
(94,506
)
(69,404
)
(491,828
)
(139,886
)
Interest income and other income
(expense), net
2,332
764
3,272
872
Loss before expense from income taxes and
loss from equity method investment
(92,174
)
(68,640
)
(488,556
)
(139,014
)
Expense from income taxes
(716
)
(461
)
(2,191
)
(129
)
Loss from equity method investment
(625
)
(551
)
(1,277
)
(762
)
Net loss
(93,515
)
(69,652
)
(492,024
)
(139,905
)
Net loss attributable to non-controlling
interest
(1,040
)
(507
)
(1,861
)
(723
)
Net loss attributable to American Well
Corporation
$
(92,475
)
$
(69,145
)
$
(490,163
)
$
(139,182
)
Net loss per share attributable to common
stockholders, basic and diluted
$
(0.33
)
$
(0.25
)
$
(1.74
)
$
(0.51
)
Weighted-average common shares
outstanding, basic and diluted
283,059,929
273,320,740
281,504,945
273,615,031
Net loss
$
(93,515
)
$
(69,652
)
$
(492,024
)
$
(139,905
)
Other comprehensive income (loss), net of
tax:
Unrealized gain (loss) on
available-for-sale investments
1,933
(111
)
6,252
(1,362
)
Foreign currency translation
(214
)
(10,179
)
1,848
(13,130
)
Comprehensive loss
(91,796
)
(79,942
)
(483,924
)
(154,397
)
Less: Comprehensive loss attributable to
non-controlling interest
(1,040
)
(507
)
(1,861
)
(723
)
Comprehensive loss attributable to
American Well Corporation
$
(90,756
)
$
(79,435
)
$
(482,063
)
$
(153,674
)
AMERICAN WELL
CORPORATION
CONDENSED CONSOLIDATED
STATEMENTS OF CASH FLOWS
(in thousands, except share
and per share amounts)
(unaudited)
Six Months Ended June
30,
2023
2022
Cash flows from operating
activities:
Net loss
$
(492,024
)
$
(139,905
)
Adjustments to reconcile net loss to net
cash used in operating activities:
Goodwill impairment
357,585
—
Depreciation and amortization expense
14,950
13,132
Provisions for credit losses
(21
)
(308
)
Amortization of deferred contract
acquisition costs
1,093
847
Amortization of deferred contract
fulfillment costs
215
288
Noncash compensation costs incurred by
selling shareholders
—
3,993
Stock-based compensation expense
42,685
27,598
Loss on equity method investment
1,277
762
Deferred income taxes
(23
)
(1,164
)
Changes in operating assets and
liabilities, net of acquisition:
Accounts receivable
10,161
5,763
Inventories
205
(391
)
Deferred contract acquisition costs
(2,338
)
(1,135
)
Prepaid expenses and other current
assets
1,091
(1,714
)
Other assets
(212
)
489
Accounts payable
(2,753
)
(6,525
)
Accrued expenses and other current
liabilities
(11,591
)
(490
)
Other long-term liabilities
—
(15
)
Deferred revenue
10,924
(6,624
)
Net cash used in operating activities
(68,776
)
(105,399
)
Cash flows from investing
activities:
Purchases of property and equipment
(36
)
(58
)
Capitalized software development costs
(13,836
)
—
Investment in less than majority owned
joint venture
(3,920
)
(1,960
)
Purchases of investments
(389,990
)
(499,223
)
Proceeds from sales and maturities of
investments
98,916
124,981
Net cash used in investing activities
(308,866
)
(376,260
)
Cash flows from financing
activities:
Proceeds from exercise of common stock
options
569
4,465
Proceeds from employee stock purchase
plan
1,268
1,501
Payments for the purchase of treasury
stock
(586
)
—
Proceeds from Section 16(b)
disgorgement
—
295
Payment of contingent consideration
—
(11,790
)
Net cash provided by (used in) financing
activities
1,251
(5,529
)
Effect of exchange rates changes on cash,
cash equivalents, and restricted cash
(799
)
(2,039
)
Net decrease in cash, cash equivalents,
and restricted cash
(377,190
)
(489,227
)
Cash, cash equivalents, and restricted
cash at beginning of period
539,341
747,211
Cash, cash equivalents, and restricted
cash at end of period
$
162,151
$
257,984
Cash, cash equivalents, and restricted
cash at end of period:
Cash and cash equivalents
161,356
257,189
Restricted cash
795
795
Total cash, cash equivalents, and
restricted cash at end of period
$
162,151
$
257,984
Supplemental disclosure of cash flow
information:
Cash paid (refunded) for income taxes
$
1,018
$
13
Supplemental disclosure of non-cash
investing and financing activities:
Issuance of common stock in settlement of
earnout
$
—
$
17,243
Non-GAAP Financial Measures:
To supplement our financial information presented in accordance
with generally accepted accounting principles in the United States,
of US GAAP, we use adjusted EBITDA, which is a non-U.S GAAP
financial measure to clarify and enhance an understanding of past
performance. We believe that the presentation of adjusted EBITDA
enhances an investor’s understanding of our financial performance.
We further believe that adjusted EBITDA is a useful financial
metric to assess our operating performance from period-to-period by
excluding certain items that we believe are not representative of
our core business. We use certain financial measures for business
planning purposes and in measuring our performance relative to that
of our competitors. We utilize adjusted EBITDA as the primary
measure of our performance.
We calculate adjusted EBITDA as net loss adjusted to exclude (i)
interest income and other income, net, (ii) tax benefit and
expense, (iii) depreciation and amortization, (iv) goodwill
impairment, (v) stock-based compensation expense, (vi) severance
expenses, (vii) capitalized software costs, (viii) litigation
expenses related to the defense of our patents in the patent
infringement claim filed by Teladoc and (ix) other items affecting
our results that we do not view as representative of our ongoing
operations, including noncash compensation costs incurred by
selling shareholders and adjustments made to the contingent
consideration.
We believe adjusted EBITDA is a commonly used by investors to
evaluate our performance and that of our competitors. However, our
use of the term adjusted EBITDA may vary from that of others in our
industry. Adjusted EBITDA should not be considered as an
alternative to net loss before taxes, net loss, loss per share or
any other performance measures derived in accordance with U.S. GAAP
as measures of performance.
Adjusted EBITDA has important limitations as an analytical tool
and you should not consider it in isolation or as a substitute for
analysis of our results as reported under U.S. GAAP. Some of the
limitations of adjusted EBITDA include (i) adjusted EBITDA does not
properly reflect capital commitments to be paid in the future, and
(ii) although depreciation and amortization are non-cash charges,
the underlying assets may need to be replaced and adjusted EBITDA
does not reflect these capital expenditures. Our legal, accounting
and other professional expenses reflect cash expenditures and we
expect such expenditures to recur from time to time. Our adjusted
EBITDA may not be comparable to similarly titled measures of other
companies because they may not calculate adjusted EBITDA in the
same manner as we calculate the measure, limiting its usefulness as
a comparative measure.
In evaluating adjusted EBITDA, you should be aware that in the
future we will incur expenses similar to the adjustments in this
presentation. Our presentation of adjusted EBITDA should not be
construed as an inference that our future results will be
unaffected by these expenses or any unusual or non-recurring items.
Adjusted EBITDA should not be considered as an alternative to loss
before benefit from income taxes, net loss, earnings per share, or
any other performance measures derived in accordance with U.S.
GAAP. When evaluating our performance, you should consider adjusted
EBITDA alongside other financial performance measures, including
our net loss and other GAAP results.
The following table presents a reconciliation of adjusted EBITDA
from the most comparable GAAP measure, net loss, for the three and
six months ended June 30, 2023 and 2022 and the three months ended
March 31, 2023:
Three Months Ended June
30,
Six Months Ended June
30,
Three Months Ended March 31,
2023
(in thousands)
2023
2022
2023
2022
Net loss
$ (93,515)
$ (69,652)
$ (492,024)
$ (139,905)
$ (398,509)
Add:
Depreciation and amortization
7,718
6,724
14,961
13,322
7,243
Interest income and other income
(expense), net
(2,332)
(764)
(3,272)
(872)
(940)
Expense from income taxes
716
461
2,191
129
1,475
Goodwill Impairment
27,276
—
357,585
—
330,309
Stock-based compensation
21,513
14,907
42,510
26,992
20,997
Severance(1)
406
—
1,981
—
1,575
Capitalized software costs
(7,085)
—
(13,836)
—
(6,751)
Noncash expenses and contingent
consideration adjustments(2)
—
1,259
—
4,996
—
Litigation expense(3)
—
4,261
—
5,399
—
Adjusted EBITDA
$ (45,303)
$ (42,804)
$ (89,904)
$ (89,939)
$ (44,601)
(1)
Severance costs associated with
the termination of employees during the three and six months ended
June 30, 2023.
(2)
Noncash expenses and contingent
consideration adjustments include, noncash compensation costs
incurred by selling shareholders and adjustments made to the
contingent consideration.
(3)
Litigation expense relates to
legal costs related to the Teladoc litigation which was dismissed
pursuant to a confidential settlement between the parties in
2022.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20230802370424/en/
Media: Angela Vogen Press@amwell.com
Investors: Sue Dooley sue.dooley@amwell.com
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