Teladoc Health, Inc. (NYSE:TDOC) Q1 2020 Earnings Conference Call Highlights Summary
CEO Jason Gorevic
Total revenue in the quarter grew 41% over the prior year to approximately $181 million. As a result of the increased demand for our services from clients and consumers, we are significantly raising forward guidance, including full-year revenue guidance of $800 million to $825 million, representing an increase of over $100 million relative to our prior range.
We are playing a critical role during the global outbreak of COVID-19 and has seen a significant increase in inquiries from both existing and new potential clients. Our clients are turning to us to expand our service offering to new populations and add new products during this time of need.
Requests from new potential clients are increasing as the outbreak of COVID-19 has highlighted the value of access to a comprehensive virtual healthcare solution. During the first quarter alone, we onboarded over 6 million new paid members in the U.S. across government and commercial populations. And we anticipate onboarding an additional 6 million to 7 million new members during the second quarter, culminating in the strongest first half membership growth in company history.
As discussed on our business update call two weeks ago, the remarkable growth across our platform has been enabled by the tremendous response on the part of our team members and physicians. We responded to the surgeon demand by rapidly expanding the capacity of our physician network, including the onboarding of thousands of new providers, more than doubling the number of licensed physicians in our network.
The investments in capacity made during the month of March have positioned us to meet the increased demand from existing members as well as the new members we are in the process of onboarding.
Turning to visits, we crossed a new milestone as total visits exceeded 2 million in the first quarter, representing growth of nearly 90% as compared to the first quarter of 2019. This is particularly noteworthy as it comes just 12 months after crossing the 1 million visit per quarter mark in the first quarter of last year.
Well, the first two months of the year were strong, visit volume accelerated significantly throughout March and into April as shelter-in-place, orders began, $0 copays were implemented and brick and mortar facilities closed. We were experiencing broad-based growth in visits across the portfolio as our diverse product offering has enabled us to step up and meet the varied healthcare needs of patients during the outbreak of COVID-19.
While general medical visit growth has increased significantly, demand for specialist care including behavioral health and dermatology has accelerated even faster reflecting the diverse nature of the need for care during this challenging time.
The increased behavioral health adoption is particularly encouraging as it creates strong longitudinal relationships generating multiple visits over time, which will help drive visit volume through the rest of the year. We have also seen an increase in new users across the platform with over 60% of visits coming from first time users.
This new user growth will have a lasting effect on utilization, since member satisfaction levels are extremely strong and our experience shows that when members use our service once they are much more likely to use it again. Importantly, new registrations increased 125%, over the prior year, outpacing member growth as the outbreak of COVID-19 is driving awareness of virtual care among consumers.
This significant increase in activation is particularly important to us as it feeds into the flywheel dynamic that is at the core of our member engagement efforts. Once an individual actively registers with us, it creates opportunities for our engagement team to reach that member and build a relationship.
These engagement opportunities serve as the growth engine that drives visit growth and utilization within our populations. And the material growth in new activations we are currently experiencing will continue to benefit us into the future as consumers turn to Teladoc Health for more of their healthcare needs.
We’re also seeing an encouraging demographic expansion in our user base. Visit growth rates among our younger cohorts in the range of 18 years to 30 years old and among males have accelerated faster than the overall growth rates, as we increasingly reach populations that have historically been lower utilizers of virtual care.
Demand for our D2C mental health product, BetterHelp is also rapidly accelerating as conditions such as anxiety and depression are amplified by fear, isolation, and loneliness during the crisis. This increased utilization will continue to benefit us throughout the year given the high repeat usage profile of mental health services.
Provider interest in BetterHelp is also increasing. We added a record number of new active mental health providers during the quarter. And provider applications to deliver care to BetterHelp members have increased over 70% in just the last few months. This increased provider activity will allow us to meet the growing need for mental health services throughout the rest of the year.
Similar to the impact on the health plan employer and consumer channels, the COVID-19 outbreak is accelerating the adoption of virtual care among hospitals and physician groups. The Teladoc Health technology platform is enabling hundreds of hospitals and physician groups across the country to continue serving their patients, increasing flexibility and capacity while dramatically reducing physical exposure for both patients and physicians.
As virtual care becomes mainstream within the healthcare delivery system, we are seeing increased demand from new partners for our provider platform. This includes both the Teladoc Health technology platform as well as the InTouch Health offering, which we have a commercial agreement in place to jointly sell the combined offering ahead of the transaction closing.
We have now signed multiple new cross sales and the pipeline of new opportunities in the provider market for this industry leading offering continues to grow. The broad-based demand we are seeing across distribution channels for our comprehensive product offering gives us confidence in the long-term growth opportunity for our business.