Amwell (NYSE:AMWL) announced its financial results for the third quarter ended September 30, 2022. Amwell, formerly known as American Well, is a telemedicine company that connects patients with doctors over secure video. The company came out with a quarterly loss of $0.25 per share versus the Zacks Consensus Estimate of a loss of $0.26. This compares to loss of $0.20 per share a year ago.
During the call, Ido Shoenberg, Chairman and Co-CEO of Amwell, spoke of progress in migration to Amwell’s digital health platform Converge, showing the company’s understanding that it must offer more than just video televisits to stay relevant post-pandemic. Mr. Shoenberg name-dropped clients such as CVS Health, LHM Health and MU Health, representing the scale and diversity of the Converge platform, which is nearing its 1 millionth visit. Despite budgetary constraint headwinds impacting health plans and health systems, Amwell still reported revenue growth of 11% over the third quarter of 2021. During the call, the Boston, Massachusetts-based company reported:
- 11% increase in total revenue from $62.2 million in Q3:21 to $69.2 million in Q3:22.
- 40% decrease in net loss from $69.7 million in Q2:22 to $41.9 million in Q3:22
- 2.1% decrease in adjusted EBITDA from $42.8 million in Q3:21 to $41.9 million in Q3:22
- 23% increase in total active providers from 80,000 in Q3:21 to 98,500 in Q3:22
- Achieved subscription revenue of $31.9 million, representing growth of 19% compared to the third quarter of 2021
- Reported gross margin of 40%
- Total visits were 1.4 million, similar to the third quarter of 2021
Here are some notable quotes from Amwell CEO Dr. Ido Schoenberg:
- “Feedback is excellent on Converge™, our digital care delivery enablement platform. We made great progress with customer migrations this quarter and we are honored that so many, including large, strategic customers, are trusting Amwell as their technology partner for years to come.” – Dr. Ido Schoenberg, Chairman and Co-CEO
- “Our approach to the market is squarely aimed at helping organizations address the challenges they are facing. We enable transformative patient and provider experiences, reduce care team burnout, and free up providers to spend their time on care by enveloping them with digital support to streamline non-core tasks. We also empower our customers to achieve important goals around better clinical and financial outcomes. We are emerging as the trusted partner who can ready payers and providers for the future of true digital first healthcare.”
Migration to the Converge platform:
- “Scheduled visits represented 70% of visit volume, consistent with the 70% to 75% range we have seen since the beginning of 2021 and up from approximately 30% pre COVID. We are making steady progress on Converge development, and the migration of our customers to our new platform is proceeding according to our plan.”
- “…if the focus of this year was development and the initial migration in strategic market segments, next year, the focus is really on migration. That would generate opportunities for same-store growth. It will create opportunities for strengthening our relationships with our customers and retention. And very importantly, this is a very close market.”
Headwinds and a digital fix:
- “As we see it, economic uncertainty creates both headwinds and tailwinds for us. We know hospital budgets are constrained, and yet the challenges facing providers and payers drive an urgent need to leverage technology to achieve their operational goals. At Amwell, we strive in every conversation to compel prospects and customers that our solutions are the must-have engine to resolve their pain points today and well into the future.”
- “It is incredibly apparent that digital is no longer just a side road to surrogate urgent care. It is rapidly becoming the main highway for all types of care offered by all types of providers and services. Providers are prioritizing digital care that allows them to offer an experience that improves staff retention, streamlines workflows, improves outcomes, and offers a business model to grow revenue and be more competitive.”
