Talkspace, Inc. (Nasdaq: TALK), a leading virtual behavioral
healthcare company, today reported 2022 first quarter results as
summarized below. All financial results refer to 2022 first quarter
and the prior-year period unless otherwise stated.
|
|
Three Months |
|
Period ended March 31, 2022 |
|
Results |
|
|
Variance from Prior Year |
|
(In
thousands unless otherwise noted, unaudited) |
|
|
|
|
|
|
Number of B2B eligible lives (in millions) |
|
|
76.5 |
|
|
|
54 |
% |
Number of
active members 1 |
|
|
64.5 |
|
|
|
10 |
% |
Number of
completed B2B sessions |
|
|
90.6 |
|
|
|
68 |
% |
|
|
|
|
|
|
|
Total
revenue |
|
$ |
30,150 |
|
|
|
11 |
% |
Gross
profit |
|
$ |
15,021 |
|
|
|
(13 |
)% |
Gross margin
% |
|
|
50 |
% |
|
~(1,400) bps |
|
Operating
expenses |
|
$ |
36,229 |
|
|
|
21 |
% |
Net
loss |
|
$ |
(20,360 |
) |
|
(60% |
) |
Adjusted
EBITDA 2 |
|
$ |
(18,411 |
) |
|
(74% |
) |
Cash and
cash equivalents |
|
$ |
184,127 |
|
|
* |
|
* = not meaningful (1) Reflects active members
at the end of the period. (2) Adjusted EBITDA is a non-GAAP
financial measure. For a reconciliation to the most directly
comparable GAAP measure, see “Reconciliation of Non-GAAP Results to
GAAP Results.”
“We delivered revenue growth in the first quarter
of 2022, led by increasing demand for our business-to-business
("B2B") services, partially offset by a decline in our consumer
business. Our business-to-consumer ("B2C") business began to
demonstrate modest improvement in a number of operating metrics as
a result of changes designed to better optimize our marketing
investments,” said Chief Financial Officer Jennifer Fulk.
“Importantly, we continued making progress on our operational
priorities throughout the quarter.” First Quarter 2022
Key Performance Metrics
- The number of individuals eligible for Talkspace via their
insurance or employer (B2B eligible lives) grew by 54% to 76.5
million, driven by expanded relationships with existing clients
including Optum as well as the addition of Beacon.
- Completed B2B sessions grew 68% to 90,600, driven primarily by
growth in B2B eligible lives.
- Active members grew 10% to 64,500, driven by strong growth in
B2B, partially offset by fewer individual consumer subscribers (B2C
clients) resulting primarily from lower marketing spend.
- Conversion metrics and customer acquisition costs modestly
improved in the quarter in our B2C business.
First Quarter 2022 Key Financial
Metrics
- Revenue grew 11% to $30 million, driven by 50% growth in B2B
revenue partially offset by a 7% decline in B2C revenue. B2B
revenue performance was driven by an increase in covered lives from
health plan clients and new enterprise clients, and a higher number
of completed B2B sessions. B2C revenue declined primarily due to
reduced marketing spend, partially offset by a one-time $0.5
million non-cash reversal in deferred revenue associated with
customers no longer active on Talkspace’s platform.
- Gross profit declined 13% to $15 million, and gross margin
declined to 50%, due primarily to a revenue mix shift toward the
B2B business, a greater number of salaried therapists within
Talkspace's network, and higher therapist hourly compensation
expense.
- Net loss was ($20) million, compared to a net loss of ($13)
million in the prior-year period, driven primarily by increased
general and administrative expenses and higher cost of revenues.
Adjusted EBITDA loss was ($18) million, compared to ($11) million
in the prior-year period.
Conference Call, Presentation Slides,
and Webcast Details
Visit investors.talkspace.com to view a
presentation related to 2022 first quarter results and business
outlook and listen to a conference call scheduled to begin at 5:00
p.m. ET on Tuesday, May 3, 2022. The conference call can also be
accessed by dialing (888) 660-0107 for U.S. participants or (409)
216-0599 for international participants (participant code 5293204).
A replay will be available shortly after the call’s completion and
remain available for approximately 90 days.
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
March 31, 2022, over 2 million people have used Talkspace, and 76.5
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/. To learn more about
Talkspace Psychiatry, please visit
https://www.talkspace.com/psychiatry.
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, achieving profitability, 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
under the caption “Risk Factors” in our Annual Report on Form 10-K
for the annual period ended December 31, 2021 filed with the
Securities and Exchange Commission (“SEC”) on February 25, 2022,
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 assume 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.
Financial Disclosures
The financial results reported in this press
release are unaudited and subject to change as additional
information becomes available pending completion of the audit.
Contacts
For Investors: Mike Lovell, Senior Director
Investor Relations 515-771-1585 Mike.Lovell@Talkspace.com
For Media: SKDK John Kim 310-997-5963
jkim@skdknick.com
Talkspace, Inc.
Consolidated Statements of Operations
(Unaudited)
|
|
Three Months Ended March 31, |
|
|
Variance |
|
|
|
2022 |
|
|
2021 |
|
|
$ |
|
|
% |
|
(in thousands, except percentages, share and per share data) |
|
|
Consumer revenue |
|
$ |
17,260 |
|
|
$ |
18,564 |
|
|
$ |
(1,304 |
) |
|
|
(7.0 |
) |
Commercial
revenue |
|
|
12,890 |
|
|
|
8,593 |
|
|
|
4,297 |
|
|
|
50.0 |
|
Total
revenue |
|
|
30,150 |
|
|
|
27,157 |
|
|
|
2,993 |
|
|
|
11.0 |
|
Cost of
revenues |
|
|
15,129 |
|
|
|
9,814 |
|
|
|
5,315 |
|
|
|
54.2 |
|
Gross
profit |
|
|
15,021 |
|
|
|
17,343 |
|
|
|
(2,322 |
) |
|
|
(13.4 |
) |
Operating
expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
Research and development, net |
|
|
5,035 |
|
|
|
2,964 |
|
|
|
2,071 |
|
|
|
69.9 |
|
Clinical operations |
|
|
1,776 |
|
|
|
2,077 |
|
|
|
(301 |
) |
|
|
(14.5 |
) |
Sales and marketing |
|
|
21,408 |
|
|
|
22,251 |
|
|
|
(843 |
) |
|
|
(3.8 |
) |
General and administrative |
|
|
8,010 |
|
|
|
2,608 |
|
|
|
5,402 |
|
|
|
* |
|
Total
operating expenses |
|
|
36,229 |
|
|
|
29,900 |
|
|
|
6,329 |
|
|
|
21.2 |
|
Operating
loss |
|
|
21,208 |
|
|
|
12,557 |
|
|
|
8,651 |
|
|
|
68.9 |
|
Financial
(income) expense, net |
|
|
(869 |
) |
|
|
173 |
|
|
|
(1,042 |
) |
|
|
* |
|
Loss before
taxes on income |
|
|
20,339 |
|
|
|
12,730 |
|
|
|
7,609 |
|
|
|
59.8 |
|
Taxes on
income |
|
|
21 |
|
|
|
8 |
|
|
|
13 |
|
|
|
* |
|
Net
loss |
|
$ |
20,360 |
|
|
$ |
12,738 |
|
|
$ |
7,622 |
|
|
|
59.8 |
|
Net loss per share (1): |
|
|
|
|
|
|
|
|
|
|
|
Basic and
Diluted |
|
$ |
0.13 |
|
|
$ |
0.93 |
|
|
$ |
(0.79 |
) |
|
|
(85.7 |
) |
Weighted average number of common shares (1): |
|
|
|
|
|
|
|
|
|
|
|
Basic and
Diluted |
|
|
154,083,443 |
|
|
|
13,762,205 |
|
|
|
|
|
|
|
* = not meaningful(1) Prior period results have
been adjusted to reflect the exchange of Old Talkspace’s common
stock for Talkspace’s common stock at an exchange ratio of
approximately 1.134140 in June 2021 as a result of the
Business Combination.
Talkspace, Inc.
Consolidated Balance Sheets
|
|
March 31, 2022 |
|
|
December 31, 2021 |
|
(in
thousands) |
|
(Unaudited) |
|
|
|
|
ASSETS |
|
|
|
|
|
|
CURRENT
ASSETS: |
|
|
|
|
|
|
Cash and cash equivalents |
|
$ |
184,127 |
|
|
$ |
198,256 |
|
Accounts receivable, net |
|
|
6,312 |
|
|
|
5,512 |
|
Other current assets |
|
|
5,039 |
|
|
|
9,562 |
|
Total current assets |
|
|
195,478 |
|
|
|
213,330 |
|
Property and equipment, net |
|
|
633 |
|
|
|
624 |
|
Intangible assets, net |
|
|
3,086 |
|
|
|
3,436 |
|
Goodwill |
|
|
6,134 |
|
|
|
6,134 |
|
Other long-term assets |
|
|
82 |
|
|
|
82 |
|
Total assets |
|
$ |
205,413 |
|
|
$ |
223,606 |
|
LIABILITIES
AND STOCKHOLDERS’ EQUITY |
|
|
|
|
|
|
CURRENT
LIABILITIES: |
|
|
|
|
|
|
Accounts payable |
|
$ |
9,490 |
|
|
$ |
7,429 |
|
Deferred revenues |
|
|
6,026 |
|
|
|
7,186 |
|
Accrued expenses and other current liabilities |
|
|
10,234 |
|
|
|
12,562 |
|
Total current liabilities |
|
|
25,750 |
|
|
|
27,177 |
|
Warrant
liabilities |
|
|
3,195 |
|
|
|
4,070 |
|
Other
long-term liabilities |
|
|
191 |
|
|
|
86 |
|
Total
liabilities |
|
|
29,136 |
|
|
|
31,333 |
|
Commitments
and contingencies |
|
|
|
|
|
|
STOCKHOLDERS’ EQUITY: |
|
|
|
|
|
|
Common stock |
|
|
15 |
|
|
|
15 |
|
Additional paid-in capital |
|
|
368,152 |
|
|
|
363,788 |
|
Accumulated deficit |
|
|
(191,890 |
) |
|
|
(171,530 |
) |
Total stockholders’ equity |
|
|
176,277 |
|
|
|
192,273 |
|
Total liabilities and stockholders’ equity |
|
$ |
205,413 |
|
|
$ |
223,606 |
|
Talkspace, Inc.
Consolidated Statements of Cash Flows
(Unaudited)
|
|
Three Months Ended March 31, |
|
(in
thousands) |
|
2022 |
|
|
2021 |
|
Cash
flows from operating activities: |
|
|
|
|
|
|
Net loss |
|
$ |
(20,360 |
) |
|
$ |
(12,738 |
) |
Adjustments
to reconcile net loss to net cash used in operating
activities: |
|
|
|
|
|
|
Depreciation and amortization |
|
|
429 |
|
|
|
462 |
|
Stock-based compensation |
|
|
2,368 |
|
|
|
1,513 |
|
Warrant issuance cost and change in fair value |
|
|
(875 |
) |
|
|
— |
|
Increase in accounts receivable, net |
|
|
(800 |
) |
|
|
(1,666 |
) |
Decrease (increase) in other current assets |
|
|
4,923 |
|
|
|
(1,076 |
) |
Increase in accounts payable |
|
|
2,061 |
|
|
|
7,030 |
|
(Decrease) increase in deferred revenues |
|
|
(1,160 |
) |
|
|
2,878 |
|
Decrease in accrued expenses and other current liabilities |
|
|
(1,837 |
) |
|
|
(282 |
) |
Increase in other long-term liabilities |
|
|
105 |
|
|
|
— |
|
Net cash
used in operating activities |
|
|
(15,146 |
) |
|
|
(3,879 |
) |
Cash
flows from investing activities: |
|
|
|
|
|
|
Purchase of property and equipment |
|
|
(88 |
) |
|
|
(319 |
) |
Net cash
used in investing activities |
|
|
(88 |
) |
|
|
(319 |
) |
Cash
flows from financing activities: |
|
|
|
|
|
|
Payment of deferred issuance costs |
|
|
— |
|
|
|
(75 |
) |
Proceeds from exercise of stock options |
|
|
2,063 |
|
|
|
797 |
|
Payments for employee taxes withheld related to vested stock-based
awards |
|
|
(558 |
) |
|
|
— |
|
Net cash
provided by financing activities |
|
|
1,505 |
|
|
|
722 |
|
Net decrease
in cash and cash equivalents |
|
|
(13,729 |
) |
|
|
(3,476 |
) |
Cash and
cash equivalents at the beginning of the period |
|
|
198,256 |
|
|
|
13,248 |
|
Cash and
cash equivalents at the end of the period (1) |
|
$ |
184,527 |
|
|
$ |
9,772 |
|
(1) As of
March 31, 2022, amount includes restricted cash of $0.4 million
maintained in a short-term certificate of deposit account and
included within other current assets in the condensed consolidated
balance sheet. |
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) certain non-recurring
expenses, where applicable.
Talkspace, Inc.
Reconciliation of Non-GAAP Results to GAAP
Results
|
Three Months Ended March 31, |
|
(in
thousands) |
2022 |
|
|
2021 |
|
Net loss |
$ |
(20,360 |
) |
|
$ |
(12,738 |
) |
Add: |
|
|
|
|
|
Depreciation
and amortization |
|
429 |
|
|
|
462 |
|
Financial
(income) expense, net (1) |
|
(869 |
) |
|
|
173 |
|
Taxes on
income |
|
21 |
|
|
|
8 |
|
Stock-based
compensation |
|
2,368 |
|
|
|
1,513 |
|
Adjusted
EBITDA |
$ |
(18,411 |
) |
|
$ |
(10,582 |
) |
1) For
the three months ended March 31, 2022, financial (income) expense,
net, primarily consisted of $0.9 million in gains resulting from
the revaluation of warrant liabilities. |
For the
three months ended March 31, 2021, financial (income) expense, net,
primarily consisted of $0.2 million in losses 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