Amwell reported a significantly larger net loss in the first quarter due to a noncash goodwill impairment charge related to a lasting decline in the company’s share price.
The telehealth company posted a $398.5 million loss compared with $70.3 million in the prior-year period and a $61.6 million loss in the fourth quarter. The impairment charge was $330.3 million.
“This charge resulted from the sustained decline in our share price and associated market capitalization compared to the book value of our equity as of quarter end,” Amwell CFO Bob Shepardson said during an earnings call.
The company posted revenue of $64 million, stable from the first quarter last year when it brought in $64.2 million. Shepardson said revenue declined $15 million from Q4, which he attributed to lower professional services revenue.
Adjusted EBITDA was a loss of $44.6 million, compared with $47.1 million in the prior-year period.
Amwell reiterated its guidance for the year, expecting $275 million to $285 million in revenue and an adjusted EBITDA loss between $150 million and $160 million.
THE LARGER TREND
Dr. Ido Schoenberg, chairman and CEO of Amwell, said much of the company’s transition to Converge, its latest virtual care platform announced in 2021, was complete.
Amwell reported 1.7 million visits in Q1, with Converge visits making up 36% compared with 28% in the fourth quarter.
Schoenberg said the platform can embed third-party tools, “much like an app store.” He pointed to the company’s partnership with chronic condition management company DarioHealth as an example.
“We made great progress with customer migrations and strategic clients went live on Converge, our unique, one-stop-shop, hybrid care enablement platform,” he said in a statement. “These successes provide valuable, in-market validation of the power and scale of Converge. Converge streamlines the simple, cohesive, and efficient delivery of hybrid healthcare.”