Teladoc Health loses $13.6 billion in 2022 due to merger of Livongo

Teladoc Health posted a loss of $13.6 billion in 2022, largely due to fees related to its acquisition of Livongo in 2020 for $18 billion.

The annual loss reported Wednesday, equivalent to $84.6 per share, compared with a loss of $428.8 million, or $2.73 per share, in 2021. In the fourth quarter, the New York-based telehealth company said it lost $3.8 billion, or $23.40 per share, compared with a loss of $11 million or 7 cents per share for the previous one-year period.

Throughout the year, Teladoc recorded $13.4 billion in non-cash loss of goodwill associated with its acquisition of Livongo. That includes a $3.8 billion charge in the fourth quarter.

Shares of Teladoc fell 8% in after-hours trading from a market close of $26.70 a share. As the company struggled financially, its share price fell from a high of $296.66 a share in February 2021.

On the earnings call with investors, Teladoc CFO Mala Murthy said the decline in non-cash goodwill had no impact on the company’s cash or liquidity. The company reported free cash flow of $16.5 million for 2022 compared with $130.1 million in 2021. The company said cash, cash equivalents, and short-term investments equaled $918 million. dollars.

The acquisition of Livongo did not go as planned for Teladoc. Livongo lost Cigna as the preferred digital health tool for chronic care conditions in December 2021. In January, Teladoc laid off 300 non-clinical employees, or 6% its workforce.

CEO Jason Gorevic said on the earnings call that broader economic challenges have left the company focused on profitability rather than revenue growth.

“Given the current operating environment, as well as the larger scale we currently operate in, you should expect us to balance growth and profitability with a greater focus on efficiency,” said Gorevic. in the future,” said Gorevic.

Teladoc reported a 41% increase in revenue for its BetterHelp consumer segment, from $720 million in 2021 to $1 billion in 2022. However, the company says the consumer segment is difficult. could return to rapid growth in 2020 and 2021.

“I don’t think you’re going to see it go back to the period of super-growth this business has seen over the past few years, when it grew better than 100%,” says Murthy. “But we think there is still a long way to go for growth in this market. If you think about virtual therapy, it hasn’t penetrated.”


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