Key Takeaways
- Teladoc Health rose 11% after its third-quarter adjusted EBITDA beat guidance, rising 14% to $79.4 million.
- BetterHelp’s insurance revenue jumped to $32.1 million, making up about half of the cash-pay revenue it lost.
- BetterHelp now competes with LifeStance Health for clinicians, while growth at Hims & Hers suggests the cash-pay slide is specific to therapy.
- Nearly $1 billion of convertible notes come due within a year, so cash flow matters.
Teladoc Health (TDOC) stock is up 11% today after third-quarter results that beat its adjusted EBITDA guidance.
CEO Chuck Divita said in the release that at BetterHelp, “insurance revenue exceeded our expectations, and we are making encouraging progress expanding provider capacity.”
That push makes BetterHelp a more direct rival to LifeStance Health Group (LFST). And its fading cash-pay business raises a question for Hims & Hers Health (HIMS): is out-of-pocket telehealth softening everywhere?
What exactly happened
- Revenue fell 3% to $605.1 million.
- Adjusted EBITDA rose 14% to $79.4 million, helped by a 26% cut to advertising and marketing.
- Management raised the low end of its 2026 ranges: revenue to $2.40-$2.44 billion and adjusted EBITDA to $277-$303 million.
Revenue has now slipped for three straight quarters:
Insurance is doing about half the job
BetterHelp’s revenue fell 13% to $206.6 million. Insurance revenue jumped to $32.1 million, but cash-pay fell 25% to $174.5 million.
Year over year, that’s about $28 million gained against about $59 million lost, roughly half the hole. Divita still expects cash-pay to struggle, and the segment’s adjusted EBITDA margin was a thin 2.2%.
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A fight for therapists, and a cash-pay check
LifeStance’s second-quarter revenue rose 26% to $435.4 million, and it ended the quarter with 8,542 clinicians after adding 193, net. Can it keep hiring that fast as BetterHelp recruits from the same pool? Its early-November report will say.
Hims & Hers points the other way: its subscribers grew 19% to nearly 2.9 million in the second quarter. My read: BetterHelp’s slide is about therapy, where insurance increasingly pays what users once paid. Hims’ Nov. 9 report will test that.
What’s next
Analysts expect revenue to bottom in 2027, then stay roughly flat:
The insurance beat argues for nudging those estimates up. But the fourth-quarter guide has BetterHelp revenue falling 18.5%-31.5%.
My take: Teladoc earned today’s jump by squeezing more profit out of a smaller business. To rerate, its insurance gains have to outrun cash-pay losses.
Of course, nearly $1 billion of convertible notes come due within a year against $850 million of cash, so the $135-$165 million free cash flow outlook has to deliver.
So what is Teladoc stock actually worth?
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Disclaimer:
Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any of the stocks mentioned. Thank you for reading, and happy investing!
