Talkspace, Inc. (“Talkspace”) (Nasdaq:
TALK), a leading virtual behavioral healthcare company, today
reported financial results for the second quarter ended June 30,
2021.
Oren Frank, Co-founder and CEO of Talkspace,
said, “We continued to experience broad-based momentum throughout
our business in the second quarter, driven by significant demand
tailwinds and a generational shift to virtual care. Our
differentiated and comprehensive product portfolio continues to
resonate in the marketplace, and we are seeing traction in both
expanding our offering within existing clients as well as adding
new clients. We are ideally positioned to address the vast, unmet
and growing demand for mental health services in innovative ways,
and we are excited to keep executing on our strategy.”
Second Quarter 2021 Financial
Highlights
The following table summarizes the Company’s
performance during the second quarter of 2021, compared to the same
period in 2020:
|
Three Months Ended June 30, |
|
Period-Over-Period |
(amounts in thousands, except percentages) |
2021 |
|
|
2020 |
|
|
Change |
Number of B2B eligible lives at period end |
|
56,039.0 |
|
|
|
33,560.5 |
|
|
67.0% |
|
Total number
of active members at period end |
|
61.5 |
|
|
|
43.5 |
|
|
41.5% |
|
|
|
|
|
|
|
|
|
|
|
|
Net
revenue |
$ |
30,983 |
|
|
$ |
17,877 |
|
|
73.3% |
|
Gross
profit |
|
19,286 |
|
|
|
12,307 |
|
|
56.7% |
|
Gross margin
% |
62.2% |
|
|
68.8% |
|
|
(660) basis
points |
Operating
expenses |
|
46,847 |
|
|
|
12,948 |
|
|
261.8% |
|
Net
loss |
|
30,441 |
|
|
|
646 |
|
|
* |
Adjusted
EBITDA (1) |
$ |
(11,872 |
) |
|
$ |
(291 |
) |
|
* |
* - not meaningful (1) Adjusted EBITDA is a
non-GAAP financial measure. Refer to “Reconciliation of Non-GAAP
Results to GAAP Results” table below.
Outlook for Third Quarter 2021 and Full
Fiscal Year 2021
The Company is reaffirming its net revenue
guidance of $125 million for the full year ending December 31,
2021. The Company’s outlook for net revenue is $32 million for the
third quarter ending September 30, 2021.
Conference Call Details
The Company will host a conference call at 5:00
p.m. E.T. to discuss these results and management’s outlook for
future financial and operational performance. A live audio webcast
will be available online at https://investors.talkspace.com/. The
conference call can also be accessed by dialing (800) 773-2954 for
U.S. participants, or (847) 413-3731 for international
participants, and referencing participant code 50201358. 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.
Key Business
Metrics
Active Members: We consider members “active” (i)
in the case of our B2C members, commencing on the date such member
initiates contact with a provider on our platform until the term of
their monthly, quarterly or bi-annual subscription plan expires,
unless terminated early, and (ii) in the case of our B2B members,
if such members have engaged on our platform during the preceding
25 days, such as sending a text, video or audio message to, or
participating in a video call with, a provider, completing a
satisfaction or progress report survey or signing up for our
platform.
B2B Eligible Lives: We consider B2B lives
“eligible” if such persons are eligible to receive treatment on the
Talkspace platform, in the case of its enterprise clients, for free
when their employer is under an active contract with Talkspace, or,
in the case of health plan clients, at an agreed upon reimbursement
rate through insurance under an employee assistance program or
other network behavioral health paid benefit program.
About Talkspace
Talkspace is a leading virtual behavioral
healthcare company enabled by a purpose-built technology platform.
As a digital healthcare company, all care is delivered through an
easy-to-use and fully encrypted web and mobile platform, consistent
with HIPAA and other state regulatory requirements.
Today, the need for care feels more urgent than
ever. When seeking treatment, whether it's psychiatry or
adolescent, individual or couples therapy, Talkspace offers
treatment options for almost every need. With Talkspace, members
can send their dedicated therapists text, video, and voice messages
anytime, from anywhere, and engage in live video sessions. As of
June 2021, over 2 million people have used Talkspace, and over 55
million lives were covered for Talkspace through insurance and
employee assistance programs or other network behavioral health
paid benefit programs.
For more information about Talkspace commercial
relationships, visit https://business.talkspace.com. To learn more
about online therapy, please visit
https://www.talkspace.com/online-therapy.
Forward Looking Statements
This press release contains certain
forward-looking statements within the meaning of the Private
Securities Litigation Reform Act of 1995, as amended. All
statements contained in this press release that do not relate to
matters of historical fact should be considered forward-looking,
including statements regarding our financial condition, anticipated
financial performance, business strategy and plans, market
opportunity and expansion and objectives of our management for
future operations. These forward-looking statements generally are
identified by the words “anticipate,” “believe,” “contemplate,”
“continue,” “could,” “estimate,” “expect,” “forecast”, “future”,
“intend,” “may,” “might”, “opportunity”, “plan,” “possible”,
“potential,” “predict,” “project,” “should,” “strategy”, “strive”,
“target,” “will,” or “would”, the negative of these words or other
similar terms or expressions. The absence of these words does not
mean that a statement is not forward-looking. Forward-looking
statements are predictions, projections and other statements about
future events that are based on current expectations and
assumptions and, as a result, are subject to risks and
uncertainties. Many important factors could cause actual future
events to differ materially from the forward-looking statements in
this press release, including but not limited to: our history of
losses; the rapid evolution of our business and the markets in
which we operate; our ability to continue growing at the rates we
have historically grown, or at all; the development of the virtual
behavioral health market; COVID-19 and its impact on business and
economic conditions; competition in our industry; and our
relationships with affiliated professional entities to provide
physician and other professional services. The foregoing list of
factors is not exhaustive. You should carefully consider the
foregoing factors and the other risks and uncertainties described
in under the caption “Risk Factors” in our prospectus dated July
12, 2021 (File No. 333-257686), as filed with the Securities and
Exchange Commission (“SEC”) pursuant to Rule 424(b)(4) under the
Securities Act of 1933, as amended, our Quarterly Report on Form
10-Q for the quarterly period ended June 30, 2021 to be filed with
the SEC, and our other documents filed from time to time with the
SEC. These filings identify and address other important risks and
uncertainties that could cause actual events and results to differ
materially from those contained in the forward-looking statements.
Forward-looking statements speak only as of the date they are made.
Readers are cautioned not to put undue reliance on forward-looking
statements, and we assumes no obligation and do not intend to
update or revise these forward-looking statements, whether as a
result of new information, future events, or otherwise. We do not
give any assurance that we will achieve our expectations.
Contacts
For Investors: Westwicke, an ICR Company Bob East
/ Asher Dewhurst / Jordan Kohnstam 443-213-0500
TalkspaceIR@westwicke.com
For Media: SKDK John Kim 310-997-5963
jkim@skdknick.com
Talkspace, Inc.
Condensed Consolidated Statements of Loss
(Unaudited)
|
|
Three months ended June 30, |
|
|
Variance |
|
|
Six months ended June 30, |
|
|
Variance |
|
|
|
2021 |
|
|
2020 |
|
|
$ |
|
|
% |
|
|
2021 |
|
|
2020 |
|
|
$ |
|
|
% |
|
|
|
|
|
|
|
|
|
|
($ in
thousands) |
|
|
($ in
thousands) |
|
Revenues |
|
$ |
30,983 |
|
|
$ |
17,877 |
|
|
$ |
13,106 |
|
|
|
73.3 |
|
|
$ |
58,140 |
|
|
$ |
28,997 |
|
|
$ |
29,143 |
|
|
|
100.5 |
|
Cost of
revenues |
|
|
11,697 |
|
|
|
5,570 |
|
|
|
6,127 |
|
|
|
110.0 |
|
|
|
21,511 |
|
|
|
10,980 |
|
|
|
10,531 |
|
|
|
95.9 |
|
Gross
profit |
|
|
19,286 |
|
|
|
12,307 |
|
|
|
6,979 |
|
|
|
56.7 |
|
|
|
36,629 |
|
|
|
18,017 |
|
|
|
18,612 |
|
|
|
103.3 |
|
Operating
expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Research and development, net |
|
|
4,781 |
|
|
|
2,400 |
|
|
|
2,381 |
|
|
|
99.2 |
|
|
|
7,745 |
|
|
|
5,128 |
|
|
|
2,617 |
|
|
|
51.0 |
|
Clinical operations |
|
|
1,913 |
|
|
|
759 |
|
|
|
1,154 |
|
|
|
152.0 |
|
|
|
3,990 |
|
|
|
1,636 |
|
|
|
2,354 |
|
|
|
143.9 |
|
Sales and marketing |
|
|
26,443 |
|
|
|
8,442 |
|
|
|
18,001 |
|
|
|
213.2 |
|
|
|
48,694 |
|
|
|
17,360 |
|
|
|
31,334 |
|
|
|
180.5 |
|
General and administrative |
|
|
13,710 |
|
|
|
1,347 |
|
|
|
12,363 |
|
|
|
917.8 |
|
|
|
16,318 |
|
|
|
2,461 |
|
|
|
13,857 |
|
|
|
563.1 |
|
Total
operating expenses |
|
|
46,847 |
|
|
|
12,948 |
|
|
|
33,899 |
|
|
|
261.8 |
|
|
|
76,747 |
|
|
|
26,585 |
|
|
|
50,162 |
|
|
|
188.7 |
|
Operating
loss |
|
|
27,561 |
|
|
|
641 |
|
|
|
26,920 |
|
|
* |
|
|
|
40,118 |
|
|
|
8,568 |
|
|
|
31,550 |
|
|
|
368.2 |
|
Financial
expenses (income), net |
|
|
2,870 |
|
|
|
(1 |
) |
|
|
2,871 |
|
|
* |
|
|
|
3,043 |
|
|
|
(31 |
) |
|
|
3,074 |
|
|
* |
|
Loss before
taxes on income |
|
|
30,431 |
|
|
|
640 |
|
|
|
29,791 |
|
|
* |
|
|
|
43,161 |
|
|
|
8,537 |
|
|
|
34,624 |
|
|
|
405.6 |
|
Taxes on
income |
|
|
10 |
|
|
|
6 |
|
|
|
4 |
|
|
|
66.7 |
|
|
|
18 |
|
|
|
9 |
|
|
|
9 |
|
|
|
100.0 |
|
Net
loss |
|
$ |
30,441 |
|
|
$ |
646 |
|
|
$ |
29,795 |
|
|
* |
|
|
$ |
43,179 |
|
|
$ |
8,546 |
|
|
$ |
34,633 |
|
|
|
405.3 |
|
* = not meaningful
Talkspace, Inc.
Condensed Consolidated Balance Sheets
|
|
June 30, 2021 |
|
|
December 31, 2020 |
|
|
|
(Unaudited) |
|
|
|
|
ASSETS |
|
|
|
|
|
|
CURRENT
ASSETS: |
|
|
|
|
|
|
Cash and cash equivalents |
|
$ |
248,173 |
|
|
$ |
13,248 |
|
Accounts receivable |
|
|
6,617 |
|
|
|
5,914 |
|
Other current assets |
|
|
4,318 |
|
|
|
1,515 |
|
Total current assets |
|
|
259,108 |
|
|
|
20,677 |
|
Property and equipment, net |
|
|
549 |
|
|
|
175 |
|
Deferred issuance costs |
|
|
- |
|
|
|
692 |
|
Intangible assets, net |
|
|
4,315 |
|
|
|
5,195 |
|
Goodwill |
|
|
6,134 |
|
|
|
6,134 |
|
Other long-term assets |
|
|
98 |
|
|
|
- |
|
Total assets |
|
$ |
270,204 |
|
|
$ |
32,873 |
|
|
|
|
|
|
|
|
LIABILITIES,
CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS’ DEFICIT |
|
|
|
|
|
|
|
|
|
|
|
|
|
CURRENT
LIABILITIES: |
|
|
|
|
|
|
Accounts payable |
|
$ |
11,759 |
|
|
$ |
7,901 |
|
Deferred revenues |
|
|
7,549 |
|
|
|
5,172 |
|
Accrued expenses and other current liabilities |
|
|
9,640 |
|
|
|
7,416 |
|
Total current liabilities |
|
|
28,948 |
|
|
|
20,489 |
|
|
|
|
|
|
|
|
Warrant
liabilities |
|
|
38,897 |
|
|
|
- |
|
Other
long-term liabilities |
|
|
98 |
|
|
|
- |
|
Total
liabilities |
|
|
67,943 |
|
|
|
20,489 |
|
|
|
|
|
|
|
|
Convertible
preferred stock |
|
|
- |
|
|
|
111,282 |
|
|
|
|
|
|
|
|
STOCKHOLDERS’ DEFICIT: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Common stock |
|
|
15 |
|
|
|
1 |
|
Additional paid-in capital |
|
|
354,213 |
|
|
|
9,889 |
|
Accumulated deficit |
|
|
(151,967 |
) |
|
|
(108,788 |
) |
Total stockholders’ deficit |
|
|
202,261 |
|
|
|
(98,898 |
) |
Total liabilities, convertible preferred stock and
stockholders’ deficit |
|
$ |
270,204 |
|
|
$ |
32,873 |
|
|
|
|
|
|
|
|
|
|
Talkspace, Inc.
Condensed Consolidated Statements of Cash Flows
(Unaudited)
|
|
Six months ended June 30, |
|
|
|
2021 |
|
|
2020 |
|
Cash flows
from operating activities: |
|
|
|
|
|
|
Net loss |
|
$ |
(43,179 |
) |
|
$ |
(8,546 |
) |
Adjustments
to reconcile net loss to net cash used in operating
activities: |
|
|
|
|
|
|
Depreciation and amortization |
|
|
955 |
|
|
|
36 |
|
Amortization of debt issuance cost |
|
|
175 |
|
|
|
— |
|
Stock-based compensation |
|
|
16,709 |
|
|
|
733 |
|
Change in fair value of warrants |
|
|
3,043 |
|
|
|
— |
|
Increase in accounts receivable |
|
|
(703 |
) |
|
|
(785 |
) |
Increase in other current assets |
|
|
(1,784 |
) |
|
|
(556 |
) |
Increase (decrease) in accounts payable |
|
|
4,833 |
|
|
|
(326 |
) |
Increase in deferred revenues |
|
|
2,377 |
|
|
|
2,068 |
|
Decrease in accrued expenses and other current liabilities |
|
|
(213 |
) |
|
|
(286 |
) |
Net cash
used in operating activities |
|
|
(17,787 |
) |
|
|
(7,662 |
) |
Cash flows
from investing activities: |
|
|
|
|
|
|
Purchase of property and equipment |
|
|
(449 |
) |
|
|
(9 |
) |
Net cash
used in investing activities |
|
|
(449 |
) |
|
|
(9 |
) |
Cash flows
from financing activities: |
|
|
|
|
|
|
Proceeds from reverse capitalization, net of transaction costs |
|
|
251,325 |
|
|
|
— |
|
Proceeds from borrowings |
|
|
6,000 |
|
|
|
— |
|
Repayment of borrowings |
|
|
(6,000 |
) |
|
|
— |
|
Payment of debt issuance costs |
|
|
(50 |
) |
|
|
— |
|
Proceeds from exercise of stock options |
|
|
1,886 |
|
|
|
62 |
|
Net cash
provided by financing activities |
|
|
253,161 |
|
|
|
62 |
|
Change in
cash and cash equivalents |
|
|
234,925 |
|
|
|
(7,609 |
) |
Cash and
cash equivalents at the beginning of the period |
|
|
13,248 |
|
|
|
39,632 |
|
Cash and
cash equivalents at the end of the period |
|
$ |
248,173 |
|
|
$ |
32,023 |
|
Non-GAAP Financial Measures
In addition to our financial results determined
in accordance with GAAP, we believe adjusted EBITDA, a non-GAAP
measure, is useful in evaluating our operating performance. We use
adjusted EBITDA to evaluate our ongoing operations and for internal
planning and forecasting purposes. We believe that this non-GAAP
financial measure, when taken together with the corresponding GAAP
financial measures, provides meaningful supplemental information
regarding our performance by excluding certain items that may not
be indicative of our business, results of operations or outlook. We
believe that the use of adjusted EBITDA is helpful to our investors
as it is a metric used by management in assessing the health of our
business and our operating performance. However, non-GAAP financial
information is presented for supplemental informational purposes
only, has limitations as an analytical tool and should not be
considered in isolation or as a substitute for financial
information presented in accordance with GAAP. In addition, other
companies, including companies in our industry, may calculate
similarly titled non-GAAP measures differently or may use other
measures to evaluate their performance, all of which could reduce
the usefulness of our non-GAAP financial measure as a tool for
comparison. A reconciliation is provided below for this non-GAAP
financial measure to net loss, the most directly comparable
financial measure stated in accordance with GAAP. Investors are
encouraged to review our GAAP financial measure and the
reconciliation of our non-GAAP financial measure to its most
directly comparable GAAP financial measure, and not to rely on any
single financial measure to evaluate our business.
Adjusted EBITDA
Adjusted EBITDA is a key performance measure
that our management uses to assess our operating performance.
Because adjusted EBITDA facilitates internal comparisons of our
historical operating performance on a more consistent basis, we use
this measure for business planning purposes and in evaluating
acquisition opportunities.
We calculate adjusted EBITDA as net loss
adjusted to exclude (i) interest and other expenses (income), net,
(ii) tax benefit and expense, (iii) depreciation and amortization
(iv) stock-based compensation expense and (v) business combination
and other financing expenses.
Talkspace, Inc.
Reconciliation of Non-GAAP Results to GAAP
Results
|
|
Three months ended June 30, |
|
|
Six months ended June 30, |
|
(in
thousands) |
|
2021 |
|
|
2020 |
|
|
2021 |
|
|
2020 |
|
Net loss |
|
$ |
(30,441 |
) |
|
$ |
(646 |
) |
|
$ |
(43,179 |
) |
|
$ |
(8,546 |
) |
Add: |
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation
and amortization |
|
|
493 |
|
|
|
18 |
|
|
|
955 |
|
|
|
36 |
|
Financial
expense (income), net (1) |
|
|
2,870 |
|
|
|
(1 |
) |
|
|
3,043 |
|
|
|
(31 |
) |
Taxes on
income |
|
|
10 |
|
|
|
6 |
|
|
|
18 |
|
|
|
9 |
|
Stock-based
compensation |
|
|
15,196 |
|
|
|
332 |
|
|
|
16,709 |
|
|
|
733 |
|
Adjusted
EBITDA |
|
$ |
(11,872 |
) |
|
$ |
(291 |
) |
|
$ |
(22,454 |
) |
|
$ |
(7,799 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) For the three months ended June 30, 2021,
financial expense, net primarily consisted of $4.0 million in
warrant issuance costs in connection with the close of the Business
Combination, partially offset by $1.4 million in gains resulting
from the revaluation of warrant liabilities. For the six months
ended June 30, 2021, financial expense, net primarily consisted of
$4.0 million in warrant issuance costs in connection with the close
of the Business Combination, partially offset by $1.2 million in
gains resulting from the revaluation of warrant liabilities.
Talkspace (NASDAQ:TALK)
Historical Stock Chart
From May 2024 to Jun 2024
Talkspace (NASDAQ:TALK)
Historical Stock Chart
From Jun 2023 to Jun 2024