Special Note Regarding Forward-Looking Statements
Many statements made in this Quarterly Report on Form 10-Q that are not
statements of historical fact, including statements about our beliefs and
expectations, are forward-looking statements and should be evaluated as such.
Forward-looking statements include information concerning possible or assumed
future results of operations, including descriptions of our business plan and
strategies. These statements often include words such as "anticipates",
"believes", "suggests", "targets", "projects", "plans", "expects", "future",
"intends", "estimates", "predicts", "potential", "may", "will", "should",
"could", "would", "likely", "foresee", "forecast", "continue" and other similar
words or phrases, as well as statements in the future tense to identify these
forward-looking statements. These forward-looking statements and projections are
contained throughout this Form 10-Q, including the section entitled"
"Management's Discussion and Analysis of Financial Condition and Results of
Operations." We base these forward-looking statements or projections on our
current expectations, plans and assumptions that we have made in light of our
experience in the industry, as well as our perceptions of historical trends,
current conditions, expected future developments and other factors we believe
are appropriate under the circumstances and at such time. As you read and
consider this Form 10-Q, you should understand that these statements are not
guarantees of performance or results. The forward-looking statements and
projections are subject to and involve risks, uncertainties and assumptions and
you should not place undue reliance on these forward-looking statements or
projections. Although we believe that these forward-looking statements and
projections are based on reasonable assumptions at the time they are made, you
should be aware that many factors could affect our actual financial results or
results of operations and could cause actual results to differ materially from
those expressed in the forward-looking statements and projections. Factors that
may materially affect such forward-looking statements and projections include,
but are not limited to, the section entitled "Risk Factors" in the 2020 Form
10-K and in our other reports and
Overview
COVID-19 Update
We believe that favorable existing macro trends were accelerated by the impacts of the COVID-19 pandemic, driving greater consumer trial and use of virtual care, and increased adoption by employers, health plans, hospitals and health systems, and health care providers. In combination with the expansion of our capabilities, we believe that these trends present significant opportunities for virtual healthcare to address the most pressing, universal healthcare challenges through trusted solutions, such as ours, that deliver convenient, high quality care; empower consumers to manage and improve their health; and enable providers to offer their best care for their patients.
We continue to closely monitor the impact of the COVID-19 pandemic on all aspects of our business. The outbreak of COVID-19 in 2020 increased utilization of our telehealth services, but it is uncertain whether such increase in demand will continue. While the COVID-19 pandemic has not had a material adverse impact on our financial
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condition and results of operations to date, the future impact on our operational and financial performance will depend on certain developments, including the duration and spread of the pandemic, impact on our Clients and Members, impact on our sales cycles, and effect on our vendors, all of which are uncertain and cannot be predicted. Public and private sector policies and initiatives to reduce the transmission of COVID-19 and disruptions to our operations and the operations of our third-party suppliers, along with any related global slowdown in economic activity, may result in decreased revenues, decreased collections, and increased costs. Further, the economic effects of the COVID-19 pandemic have financially constrained some of our prospective and existing Clients' healthcare spending, which may negatively impact our ability to acquire new Clients and our ability to renew subscriptions with or sell additional solutions to our existing Clients. We also may experience increased Member attrition to the extent our existing Clients' reduce their respective workforces in response to economic conditions. In addition, due to our subscription-based business model, the effect of the COVID-19 pandemic may not be fully reflected in our revenue until future periods. It is possible that the COVID-19 pandemic, the measures taken by the governments and businesses affected and any resulting economic impact may materially and adversely affect our business, results of operations, cash flows and financial positions as well as our customers.
We have also taken measures in response to the COVID-19 pandemic, including temporarily closing our offices and implementing a work from home policy for our workforce; limiting capacity at our offices that have reopened; implementing additional safety policies and procedures for employees working in our offices that have reopened; suspending employee travel and in person meetings; and adjusting our supply chain and inventory levels. We may take further actions that alter our business operations as may be required by federal, state, local or foreign authorities or that we determine are in the best interests of our employees, Clients, Members, and stockholders. The effects of these operational modifications are unknown and may not be realized until further reporting periods.
Revenue
We have a demonstrated track record of driving growth both organically and
through acquisitions. We increased revenue 151% to
For the quarter ended
Membership, Visits and Platform Enabled Sessions
We completed approximately 3.2 million telehealth visits in the first three
months of 2021 and approximately 10.6 million telehealth visits for the full
year of 2020.
Acquisition History
We have scaled and intend to continue to scale our platform through the pursuit of selective acquisitions. We have completed multiple acquisitions since our inception, which we believe have expanded our distribution capabilities and broadened our service offerings.
On
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On
On
Key Factors Affecting Our Performance
We believe that our future performance will depend on many factors, including the following:
Number of Members. Our revenue growth rate and long-term profitability are
affected by our ability to increase our number of Members because we derive a
substantial portion of our revenue from subscription access fees via Client
contracts that provide Members access to our professional provider network in
exchange for a contractual based monthly fee or subscription access fees derived
from our D2C Members. Therefore, we believe that our ability to add new Members
is a key indicator of our increasing market adoption, the growth of our business
and future revenue potential, and that increasing our Membership is an integral
objective that will provide us with the ability to continually innovate our
services and support initiatives that will enhance Members' experiences.
Number of Visits. We also recognize revenue in connection with the completion of
a general medical visit, expert medical service, and other specialty visits for
the majority of our contracts. Accordingly, our visit revenue, or visit fees,
generally increase as the number of visits increase. Visit fee revenue is driven
primarily by the number of Clients, the number of Members in a Client's
population, Member utilization of our provider network services and the
contractually negotiated prices of our services. We believe that increasing our
current Member utilization rate and increasing penetration further into existing
and new health plan Clients is a key objective in order for our Clients to
realize tangible healthcare savings with our service. Visits increased by 56%,
or 1.1 million, to approximately 3.2 million for the quarter ended
Number Platform Enabled of Sessions. A platform-enabled session is a unique
instance in which our licensed software platform has facilitated a virtual voice
or video encounter between a care provider and our Client's patient, or between
care providers. We believe platform-enabled sessions are an indicator of the
value our Clients derive from the platform they license from us in order to
facilitate virtual care. Over time, we expect platform-enabled sessions to
outpace overall revenue growth as telehealth becomes a bigger part of our
Clients' care delivery strategy. Our Clients completed 1.1 million
platform-enabled sessions during the quarter ended
Seasonality. We typically experience the strongest increases in consecutive
quarterly revenue during the fourth and first quarters of each year, which
coincides with traditional annual benefit enrollment seasons. In particular, as
a result of many Clients' introduction of new services at the very end of the
current year, or the start of each year, a high concentration of our new Client
contracts has an effective date of
As a result of national seasonal cold and flu trends, we typically experience our highest level of visit fees during the first and fourth quarters of each year. Conversely, the second quarter of the year has historically been the period of lowest utilization of our provider network services relative to the other quarters of the year. However, during the COVID-19 pandemic in 2021 and 2020, we did not experience the typical seasonality associated with national cold and flu outbreaks. See "Risk Factors-Risks Related to Our Business-Our quarterly results may fluctuate significantly,
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which could adversely impact the value of our common stock." included in our
Form 10-K for the year ended
Critical Accounting Policies and Estimates
Our discussion and analysis of our results of operations, liquidity and capital
resources are based on our condensed consolidated financial statements which
have been prepared in conformity with accounting principles generally accepted
in
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