Teladoc Health Inc

Previous wording

Number of U.S. Integrated Care Members. U.S. Integrated Care members represent the number of unique individuals who have paid access and visit fee only access to our suite of integrated care services in the U.S. at the end of the applicable period. Our revenue growth rate and long-term profitability are affected by our ability to increase cross selling capability among our existing members over time because we derive a substantial portion of our revenue from access and other fees via Client contracts that provide members access to our professional provider network in exchange for a contractual based periodic fee. Therefore, we believe that our ability to add new members and retain existing members, and to increase utilization and penetration further into existing and new health plan and employer Clients is a key indicator of our increasing market adoption, the growth of our business, and our future revenue potential. We further believe that increasing our membership is an integral objective that will provide us with the ability to continually innovate our services and support initiatives that will enhance members’ experiences. U.S. Integrated Care members increased by 6.5 million, or 8%, to 92.4 million at June 30, 2024, compared to the same period in 2023.

Current wording

Number of U.S. Integrated Care Members. U.S. Integrated Care members represent the number of unique individuals who have paid access and visit fee only access to our suite of integrated care services in the U.S. at the end of the applicable period. Our revenue growth rate and long-term profitability are affected by our ability to increase cross selling capability among our existing members over time because we derive a substantial portion of our revenue from access and other fees via Client contracts that provide members access to our professional provider network in exchange for a contractual based periodic fee. Therefore, we believe that our ability to add new members and retain existing members, and to increase utilization and penetration further into existing and new health plan and employer Clients is a key indicator of our increasing market adoption, the growth of our business, and our future revenue potential. We further believe that increasing our membership is an integral objective that will provide us with the ability to continually innovate our services and support initiatives that will enhance members’ experiences. U.S. Integrated Care members increased by 3.7 million, or 4%, to 93.9 million at September 30, 2024, compared to the same period in 2023.

Previous wording

Chronic Care Program Enrollment. Chronic care program enrollment represents the total number of enrollees across our suite of chronic care programs at the end of a given period. Our chronic care program enrollments are one of the key components of our whole person virtual care platform that we believe positions us to drive greater engagement with our platforms and increased revenue. Chronic care program enrollment increased by 9% to 1.173 million at June 30, 2024, compared to 1.073 million at June 30, 2023.

Current wording

Chronic Care Program Enrollment. Chronic care program enrollment represents the total number of enrollees across our suite of chronic care programs at the end of a given period. Our chronic care program enrollments are one of the key components of our whole person virtual care platform that we believe positions us to drive greater engagement with our platforms and increased revenue. Chronic care program enrollment increased by 5% to 1.179 million at September 30, 2024, compared to 1.122 million at September 30, 2023.

Previous wording

Average Monthly Revenue Per U.S. Integrated Care Member. Average monthly revenue per U.S. Integrated Care member measures the average monthly amount of global revenue that we generate from a U.S. Integrated Care member for a particular period. It is calculated by dividing the total revenue generated from the Integrated Care segment by the average number of U.S. Integrated Care members during the applicable period. Approximately 20% of total Integrated Care revenues relates to international and hospital and health systems for which membership is not considered as a management metric. We believe that our ability to increase the revenue generated from each member over time is also a key indicator of our increasing market adoption, the growth of our business, and future revenue potential. Average monthly revenue per U.S. Integrated Care member was $1.36 in the three months ended June 30, 2024, compared to $1.41 in the same period in 2023. Average monthly revenue per U.S. Integrated Care member decreased to $1.37 in the six months ended June 30, 2024 from $1.40 in the same period in 2023. The change in average monthly revenue versus the indicated prior periods is reflective of the growth of onboarding new members and the timing and mix of when fees are realized.

Current wording

Average Monthly Revenue Per U.S. Integrated Care Member. Average monthly revenue per U.S. Integrated Care member measures the average monthly amount of global revenue that we generate from a U.S. Integrated Care member for a particular period. It is calculated by dividing the total revenue generated from the Integrated Care segment by the average number of U.S. Integrated Care members during the applicable period. Approximately 20% of total Integrated Care revenues relates to international and hospital and health systems for which membership is not considered as a management metric. We believe that our ability to increase the revenue generated from each member over time is also a key indicator of our increasing market adoption, the growth of our business, and future revenue potential. Average monthly revenue per U.S. Integrated Care member was $1.36 in the three months ended September 30, 2024, compared to $1.41 in the same period in 2023. Average monthly revenue per U.S. Integrated Care member decreased to $1.37 in the nine months ended September 30, 2024 from $1.40 in the same period in 2023. The change in average monthly revenue versus the indicated prior period is reflective of the growth of onboarding new members and the timing and mix of when fees are realized.

Previous wording

BetterHelp Paying Users. BetterHelp paying users represent the average number of global monthly paying users of our BetterHelp therapy services during the applicable period. We believe that our ability to add new paying users and retain existing users is a key indicator of the market adoption of BetterHelp, the growth of that business, and future revenue potential. BetterHelp paying users decreased by 14% to 0.407 million for the three months ended June 30, 2024, compared to 0.476 million for the three months ended June 30, 2023, and decreased by 13% to 0.411 million for the six months ended June 30, 2024, compared to 0.471 million for the six months ended June 30, 2023.

Current wording

BetterHelp Paying Users. BetterHelp paying users represent the average number of global monthly paying users of our BetterHelp therapy services during the applicable period. We believe that our ability to add new paying users and retain existing users is a key indicator of the market adoption of BetterHelp, the growth of that business, and future revenue potential. BetterHelp paying users decreased by 13% to 0.398 million for the three months ended September 30, 2024, compared to 0.459 million for the three months ended September 30, 2023, and decreased by 13% to 0.407 million for the nine months ended September 30, 2024, compared to 0.467 million for the nine months ended September 30, 2023.

Previous wording

As a result of sustained decreases in our publicly quoted share price and market capitalization as well as changes in the operating results of the BetterHelp reporting unit, we conducted an interim test of our goodwill, definite-lived intangibles, and other long-lived assets at June 30, 2024. Following this test, we did not identify an impairment to our definite-lived intangible assets or other long-lived assets, but recorded a $790 million non-deductible, non-cash goodwill impairment charge for the three and six months ended June 30, 2024, or $4.64 per basic and diluted share for the three months ended June 30, 2024 and $4.68 per basic and diluted share for the six months ended June 30, 2024.

Current wording

As a result of sustained decreases in our publicly quoted share price and market capitalization through June 30, 2024 as well as changes in the operating results of the BetterHelp reporting unit, we conducted an interim test of our goodwill, definite-lived intangibles, and other long-lived assets at June 30, 2024. Following this test, we did not identify an impairment to our definite-lived intangible assets or other long-lived assets, but recorded a $790.0 million non-deductible, non-cash goodwill impairment charge for the three months ended June 30, 2024. No goodwill impairment charge was recognized for the three months ended September 30, 2024.

Previous wording

Our June 30, 2024 goodwill impairment testing was performed using a discounted cash flow method under the income approach. Unlike in prior testing, we did not utilize the market approach because of limited availability of relevant comparable company information. We believe using only the income approach is appropriate as it most directly reflects our future growth and profitability expectations. For our June 30, 2024 impairment testing, we reduced our estimated future cash flows related to our BetterHelp reporting unit used in the impairment assessment, including revenues and margin, to reflect out best and most recent estimates at this time. We also updated certain significant inputs into the valuation models including the discount rate, which increased to 15%, reflecting, in part, higher interest rates. Our updates to our discount rate and estimated future cash flows each had a significant impact to the estimated fair value of the reporting unit.

Current wording

Our June 30, 2024 goodwill impairment testing was performed using a discounted cash flow method under the income approach. Unlike in prior testing, we did not utilize the market approach because of limited availability of relevant comparable company information. We believe using only the income approach is appropriate as it most directly reflects our future growth and profitability expectations. For our June 30, 2024 impairment testing, we reduced our estimated future cash flows related to our BetterHelp reporting unit used in the impairment assessment, including revenues and margin, to reflect our best and most recent estimates at this time. We also updated certain significant inputs into the valuation models including the discount rate, which increased to 15%, reflecting, in part, higher interest rates. Our updates to our discount rate and estimated future cash flows each had a significant impact to the estimated fair value of the reporting unit.

Previous wording

Adjusted EBITDA consists of net loss before provision for income taxes; other expense (income), net; interest income; interest expense; depreciation of property and equipment; amortization of intangible assets; restructuring costs; acquisition, integration, and transformation cost; goodwill impairment; and stock-based compensation.

Current wording

Adjusted EBITDA consists of net loss before provision for income taxes; other (income) expense, net; interest income; interest expense; depreciation of property and equipment; amortization of intangible assets; restructuring costs; acquisition, integration, and transformation cost; goodwill impairment; and stock-based compensation.

Previous wording

•Adjusted EBITDA eliminates the impact of the provision for income taxes on our results of operations, and it does not reflect other expense (income), net, interest income, or interest expense;

Current wording

•Adjusted EBITDA eliminates the impact of the provision for income taxes on our results of operations, and it does not reflect other (income) expense, net, interest income, or interest expense;

Previous wording

The following table sets forth our Condensed Consolidated Statements of Operations data for the six months ended June 30, 2024 and 2023 and the dollar and percentage change between the respective periods (in thousands, except per share data):

Current wording

The following table sets forth our Condensed Consolidated Statements of Operations data for the nine months ended September 30, 2024 and 2023 and the dollar and percentage change between the respective periods (in thousands, except per share data):

Previous wording

The following table reconciles net loss, the most directly comparable GAAP financial measure, to Adjusted EBITDA for the three and six months ended June 30, 2024 and 2023 (in thousands):

Current wording

The following table reconciles net loss, the most directly comparable GAAP financial measure, to Adjusted EBITDA for the three and nine months ended September 30, 2024 and 2023 (in thousands):

Previous wording

$16.0 million, or 3%. Other revenue, which predominately includes visit fees and, to a lesser extent, revenue from the sales of our telehealth solutions for hospitals and health systems, was $82.8 million for the three months ended June 30, 2024, compared to $76.7 million for the three months ended June 30, 2023, an increase of $6.1 million, or 8%. For the three months ended June 30, 2024, 87% and 13% of our revenue was derived from access fees and other revenue, respectively, as compared to 88% and 12%, respectively, for the three months ended June 30, 2023. By geography, International revenue increased by 12% to $101.6 million while U.S. revenue decreased by 4% to $540.8 million, each compared to the three months ended June 30, 2023.

Current wording

Revenue. Total revenue was $640.5 million for the three months ended September 30, 2024, compared to $660.2 million during the three months ended September 30, 2023, a decrease of $19.7 million, or 3%. This decrease in revenue was driven substantially by lower revenue in our BetterHelp segment. Total access fees were $555.3 million for the three months ended September 30, 2024, compared to $582.1 million for the three months ended September 30, 2023, a decrease of $26.8 million, or 5%. Other revenue, which predominately includes visit fees and, to a lesser extent, revenue from the sales of our telehealth solutions for hospitals and health systems, was $85.2 million for the three months ended September 30, 2024, compared to $78.2 million for the three months ended September 30, 2023, an increase of $7.1 million, or 9%. For the three months ended September 30, 2024, 87% and 13% of our revenue was derived from access fees and other revenue, respectively, as compared to 88% and 12%, respectively, for the three months ended September 30, 2023. By geography, International revenue increased by 15% to $104.3 million while U.S. revenue decreased by 6% to $536.2 million, each compared to the three months ended September 30, 2023.

Previous wording

For the six months ended June 30, 2024, the increase of total revenue was 1%, growing to $1,288.6 million compared to $1,281.7 million for the six months ended June 30, 2023. This growth was driven substantially by the generation of additional other revenue. Revenue from access fees was $1,116.8 million for the six months ended June 30, 2024, compared to $1,126.5 million for the six months ended June 30, 2023, a decrease of $9.7 million, or 1%. Other revenue was $171.8 million for the six months ended June 30, 2024, compared to $155.1 million for the six months ended June 30, 2023, an increase of $16.6 million, or 11%. For the six months ended June 30, 2024, 87% and 13% of our revenue was derived from access fees and other revenue, respectively, as compared to 88% and 12%, respectively, for the six months ended June 30, 2023. By geography, International revenue increased by 12% to $200.2 million while U.S. revenue decreased by 1% to $1,088.4 million, each compared to the six months ended June 30, 2023.

Current wording

For the nine months ended September 30, 2024, the decrease of total revenue was 1%, from $1,941.9 million for the nine months ended September 30, 2023 to $1,929.1 million. This decrease was driven substantially by lower revenue in our BetterHelp segment. Revenue from access fees was $1,672.1 million for the nine months ended September 30, 2024, compared to $1,708.6 million for the nine months ended September 30, 2023, a decrease of $36.5 million, or 2%. Other revenue was $257.0 million for the nine months ended September 30, 2024, compared to $233.3 million for the nine months ended September 30, 2023, an increase of $23.7 million, or 10%. For the nine months ended September 30, 2024, 87% and 13% of our revenue was derived from access fees and other revenue, respectively, as compared to 88% and 12%, respectively, for the nine months ended September 30, 2023. By geography, International revenue increased by 13% to $304.5 million while U.S. revenue decreased by 3% to $1,624.6 million, each compared to the nine months ended September 30, 2023.

Previous wording

Cost of Revenue (exclusive of depreciation and amortization, which are shown separately below). Cost of revenue was $188.1 million for the three months ended June 30, 2024, compared to $190.5 million for the three months ended June 30, 2023, a decrease of $2.5 million, or 1%. The decrease was primarily driven by lower technology costs, partially offset by higher amortization of device costs. On a year-to-date basis, cost of revenue increased by $2.0 million, or 1%, to $382.6 million. The increase was primarily driven by higher costs associated with the growth in revenue and higher amortization of device costs, partially offset by lower technology costs.

Current wording

Cost of Revenue (exclusive of depreciation and amortization, which are shown separately below). Cost of revenue was $179.7 million for the three months ended September 30, 2024, compared to $186.0 million for the three months ended September 30, 2023, a decrease of $6.2 million, or 3%. The decrease was primarily driven by lower physician and product shipping costs, partially offset by higher amortization of device costs. On a year-to-date basis, cost of revenue decreased by $4.3 million, or 1%, to $562.3 million. The decrease was also primarily driven by lower physician and product shipping costs, partially offset by higher amortization of device costs.

Previous wording

$8.5 million, or 5%. This primarily reflects lower digital and media advertising cost. On a year-to-date basis, advertising and marketing expenses decreased by $1.9 million, or 1%, to $353.6 million. The decrease was driven mainly by lower digital and media advertising costs and lower professional fees.

Current wording

Advertising and Marketing Expenses. Advertising and marketing expenses were $177.5 million for the three months ended September 30, 2024, compared to $186.2 million for the three months ended September 30, 2023, a decrease of $8.7 million, or 5%. This decrease primarily reflects lower digital and media advertising costs. On a year-to-date basis, advertising and marketing expenses decreased by $10.6 million, or 2%, to $531.1 million. The decrease was driven mainly by lower digital and media advertising costs and lower employee compensation costs.

Previous wording

Sales Expenses. Sales expenses were $50.4 million for the three months ended June 30, 2024, compared to $53.5 million for the three months ended June 30, 2023, a decrease of $3.1 million, or 6%. The decrease was primarily driven by lower employee compensation costs, partially offset by higher costs for conference and events and for professional fees. On a year-to-date basis, sales expenses decreased by $3.2 million, or 3%, to $104.8 million. This reflects lower employee compensation costs and legal fees, partially offset by higher costs for professional fees.

Current wording

Sales Expenses. Sales expenses were $47.5 million for the three months ended September 30, 2024, compared to $52.3 million for the three months ended September 30, 2023, a decrease of $4.8 million, or 9%. On a year-to-date basis, sales expenses decreased by $8.1 million, or 5%, to $152.3 million. The decreases in both the three month and year-to-date periods reflect lower employee compensation costs, partially offset by higher costs for professional fees.

Previous wording

Technology and Development Expenses. Technology and development expenses were $76.8 million for the three months ended June 30, 2024, compared to $87.3 million for the three months ended June 30, 2023, a decrease of $10.6 million, or 12%. This decrease reflects lower employee compensation costs, partially offset by higher professional fees and higher infrastructure and hosting costs associated with running operations and ongoing projects and services to continuously improve and optimize our products and services. On a year-to-date basis, technology and development expenses decreased by $16.2 million, or 9% to $158.1 million. The decrease was primarily driven by lower employee compensation costs and contract labor costs, partially offset by higher infrastructure, hosting and software license costs. For the three months ended June 30, 2024 and 2023, research and development costs, which exclude amounts reflected as capitalized software development costs, were $22.2 million and $33.2 million, respectively. For the six months ended June 30, 2024 and 2023, research and development costs were $47.0 million and $63.6 million, respectively.

Current wording

Technology and Development Expenses. Technology and development expenses were $72.4 million for the three months ended September 30, 2024, compared to $84.3 million for the three months ended September 30, 2023, a decrease of $11.9 million, or 14%. On a year-to-date basis, technology and development expenses decreased by $28.1 million, or 11%, to $230.5 million. The decreases for both the three month and year-to-date periods reflect lower employee compensation costs and professional fees, partially offset by higher infrastructure, hosting, and software license costs associated with running operations as well as ongoing projects and services to continuously improve and optimize our products and services.

Previous wording

General and Administrative Expenses. General and administrative expenses decreased $16.3 million, or 13%, to $109.6 million for the three months ended June 30, 2024, compared to $125.8 million for the three months ended June 30, 2023. The decrease was primarily driven by lower employee compensation costs, therapist onboarding costs, and indirect taxes. On a year-to-date basis, general and administrative expenses decreased $18.7 million, or 8%, to $221.2 million. The decrease was primarily driven by lower employee compensation costs, therapist onboarding costs, indirect taxes and bad debt expenses, partially offset by higher software and infrastructure costs.

Current wording

General and Administrative Expenses. General and administrative expenses decreased $1.5 million, or 1%, to $114.2 million for the three months ended September 30, 2024, compared to $115.7 million for the three months ended September 30, 2023. The decrease was primarily driven by lower employee compensation costs, indirect taxes, therapist onboarding costs, and bad debt expense, offset by higher legal costs, professional fees, and software and infrastructure costs. On a year-to-date basis, general and administrative expenses decreased $20.2 million, or 6%, to $335.5 million. The decrease was primarily driven by lower employee compensation costs, therapist onboarding costs, indirect taxes, and bad debt expenses, partially offset by higher legal costs and software and infrastructure costs.

Previous wording

As a result of the termination of our former CEO, we recognized approximately $6.4 million of related costs for the three and six months ended June 30, 2024, with $1.2 million for cash severance costs and $5.2 million for stock-based compensation.

Current wording

As a result of the termination of our former CEO, we recognized approximately $6.4 million of related costs for the nine months ended September 30, 2024, with $1.2 million for cash severance costs and $5.2 million for stock-based compensation.

Previous wording

Goodwill Impairment. As discussed earlier under the section "Critical Accounting Estimates and Policies: Goodwill Impairment Charge," we recorded a non-cash goodwill impairment charge of $790.0 million for the three and six months ended June 30, 2024, following the goodwill impairment testing performed. The non-cash charge had no impact on the provision for income taxes.

Current wording

Goodwill Impairment. As discussed earlier under the section "Critical Accounting Estimates and Policies: Goodwill Impairment Charge," we recorded a non-cash goodwill impairment charge of $790.0 million for the nine months ended September 30, 2024 resulting from the June 30, 2024 interim goodwill impairment testing performed. The non-cash charge had no impact on the provision for income taxes.

Previous wording

Acquisition, Integration, and Transformation Costs. Acquisition, integration, and transformation costs primarily consisted of costs to integrate and upgrade our Customer Relationship Management and Enterprise Resource Planning ecosystem and were $0.5 million and $5.1 million for the three months ended June 30, 2024 and 2023 respectively, and were $0.8 million and $11.0 million for the six months ended June 30, 2024 and 2023, respectively.

Current wording

Acquisition, Integration, and Transformation Costs. Acquisition, integration, and transformation costs primarily consisted of costs to integrate and upgrade our Customer Relationship Management and Enterprise Resource Planning ecosystem and were $0.5 million and $5.8 million for the three months ended September 30, 2024 and 2023 respectively, and were $1.3 million and $16.8 million for the nine months ended September 30, 2024 and 2023, respectively.

Previous wording

Restructuring Costs. Restructuring costs for the three months ended June 30, 2024 were $1.5 million, of which $1.3 million was for employee transition, severance, employee benefits, and related costs and $0.1 million was for other restructuring related costs. Restructuring costs for the six months ended June 30, 2024, were $11.2 million which primarily consisted of employee transition, severance, employee benefits, and related costs. For the three and six months ended June 30, 2023, restructuring costs were $7.5 million and $15.6 million respectively, and also consisted of charges related to the reduction of office space and severance.

Current wording

Restructuring Costs. Restructuring costs for the three months ended September 30, 2024 were $3.6 million, of which $2.3 million was for employee transition, severance, employee benefits, and related costs and $1.3 million was related to costs associated with office space reductions, including $1.0 million of right-of-use asset impairment charges. Restructuring costs for the nine months ended September 30, 2024, were $14.8 million, with $10.7 million of employee transition, severance, employee benefits, and related costs, $1.3 million of costs associated with office space reductions, including $1.0 million of right-of-use asset impairment charges, and $2.8 million of other restructuring related costs.

Previous wording

$72.5 million for the three months ended June 30, 2023, an increase of $22.4 million, or 31%. Amortization of intangible assets was $189.9 million for the six months ended June 30, 2024, compared to $139.4 million for the six months ended June 30, 2023, an increase of $50.5 million, or 36%. The higher expense was driven by higher amortization of intangible assets due to the acceleration of amortization associated with the Livongo trademark as well as an increase in the amortization of capitalized software development costs related to our investment in platforms. In the second half of 2023, we initiated a strategy to transition the majority of our chronic condition management Clients and members to the Teladoc Health brand on a phased basis, with a smaller subset continuing to be served under the Livongo trade name beyond 2024. In connection with the brand strategy, we accelerated the amortization of intangible assets that are associated with the Livongo trademark, increasing amortization of intangible assets expense in the year ended December 31, 2023 and in the year ending December 31, 2024, with corresponding reductions thereafter. The change in accounting estimate resulted in additional amortization of intangible expense for acquired intangibles of $18.6 million, or $0.11 per basic and diluted share, for the three months ended June 30, 2024 and $37.2 million, or $0.22 per basic and diluted share, for the six months ended June 30, 2024.

Current wording

In the second half of 2023, we initiated a strategy to transition the majority of our chronic condition management Clients and members to the Teladoc Health brand on a phased basis, with a smaller subset continuing to be served under the Livongo trade name beyond 2024. In connection with the brand strategy, we accelerated the amortization of intangible assets that are associated with the Livongo trademark, increasing amortization of intangible assets expense in the year ended December 31, 2023 and continuing through the six months ended June 30, 2024, with corresponding reductions thereafter.

Previous wording

Depreciation of Property and Equipment. Depreciation of property and equipment was $1.7 million for the three months ended June 30, 2024, compared to $3.0 million for the three months ended June 30, 2023, a decrease of $1.3 million, or 42%. On a year-to-date basis, depreciation of property and equipment was $4.5 million for the six months ended June 30, 2024, compared to $5.9 million for the six months ended June 30, 2023, a decrease of $1.3 million, or 23%

Current wording

Depreciation of Property and Equipment. Depreciation of property and equipment was $2.7 million for the three months ended September 30, 2024, compared to $2.5 million for the three months ended September 30, 2023, an increase of $0.2 million, or 8%. On a year-to-date basis, depreciation of property and equipment was $7.2 million for the nine months ended September 30, 2024, compared to $8.3 million for the nine months ended September 30, 2023, a decrease of $1.1 million, or 14%

Previous wording

Interest Income. Interest income consisted of interest earned on cash and cash equivalents. Interest income was $13.6 million for the three months ended June 30, 2024, compared to $11.6 million for the three months ended June 30, 2023. Interest income was $27.5 million for the six months ended June 30, 2024 compared to $20.5 million for the six months ended June 30, 2023. The increase for both periods was primarily driven by higher interest rate yields and an increase in cash and cash equivalent balances.

Current wording

Interest Income. Interest income consisted of interest earned on cash and cash equivalents. Interest income was $15.3 million for the three months ended September 30, 2024, compared to $12.6 million for the three months ended September 30, 2023. Interest income was $42.8 million for the nine months ended September 30, 2024 compared to $33.1 million for the nine months ended September 30, 2023. The increase for both periods was primarily driven by higher interest rate yields and an increase in cash and cash equivalent balances.

Previous wording

Interest Expense. Interest expense consisted of interest costs and the amortization of debt discounts primarily associated with the convertible senior notes. Interest expense was $5.6 million for the three months ended June 30, 2024, compared to $5.8 million for the three months ended June 30, 2023. Interest expense was $11.3 million and $11.1 million for the six months ended June 30, 2024 and 2023, respectively.

Current wording

Interest Expense. Interest expense consisted of interest costs and the amortization of debt discounts primarily associated with the convertible senior notes. Interest expense was $5.7 million for the three months ended September 30, 2024, compared to $5.6 million for the three months ended September 30, 2023. Interest expense was $17.0 million and $16.7 million for the nine months ended September 30, 2024 and 2023, respectively.

Previous wording

$0.9 million for the six months ended June 30, 2024, compared to an income of $4.7 million for the six months ended June 30, 2023, primarily reflecting losses on foreign currency exchange rate fluctuations in 2024 and a gain on the partial sale of a business in 2023.

Current wording

Other (Income) Expense, net. Other (income) expense, net was an income of $2.2 million for the three months ended September 30, 2024, compared to an expense of $1.8 million for the three months ended September 30, 2023, primarily reflecting the impact of foreign currency exchange rate fluctuations. Other (income) expense, net was an income of $1.3 million for the nine months ended September 30, 2024, compared to $2.9 million for the nine months ended September 30, 2023, primarily reflecting gains on foreign currency exchange rate fluctuations for the nine months ended September 30, 2024 and a gain on the partial sale of a business, partially offset by losses on foreign currency exchange rate fluctuations for the nine months ended September 30, 2023.

Previous wording

Provision for Income Taxes. We recorded an income tax expense of $3.9 million for the three months ended June 30, 2024, compared to $1.0 million for the three months ended June 30, 2023, and income tax expense of $6.6 million for the six months ended June 30, 2024, compared to $0.3 million for the six months ended June 30, 2023.

Current wording

Provision for Income Taxes. We recorded an income tax expense of $0.8 million for the three months ended September 30, 2024, compared to $2.5 million income tax benefit for the three months ended September 30, 2023, and an income tax expense of $7.4 million for the nine months ended September 30, 2024, compared to $2.8 million income tax benefit for the nine months ended September 30, 2023.

Previous wording

The following tables set forth the results of operations for the relevant segments for the three and six months ended June 30, 2024 and 2023 (dollars in thousands):

Current wording

The following tables set forth the results of operations by segment for the three and nine months ended September 30, 2024 and 2023 (dollars in thousands):

Previous wording

Integrated Care total revenues increased by $17.4 million, or 5%, to $377.4 million for the three months ended June 30, 2024, primarily on higher chronic care results and higher visit revenue in the U.S., as well as strong growth internationally. For the six months ended June 30, 2024, Integrated Care total revenues increased by $44.5 million, or 6%, to $754.5 million, primarily on higher chronic care results and higher visit revenue in the U.S., as well as strong growth internationally.

Current wording

Integrated Care total revenues increased by $9.3 million, or 2%, to $383.7 million for the three months ended September 30, 2024, reflecting higher visit revenue in the U.S., as well as strong growth internationally. For the nine months ended September 30, 2024, Integrated Care total revenues increased by $53.8 million, or 5%, to $1,138.2 million, primarily on higher chronic care results and higher visit revenue in the U.S., as well as strong growth internationally.

Previous wording

Integrated Care Adjusted EBITDA increased by $26.1 million, or 69%, to $64.0 million for the three months ended June 30, 2024, primarily reflecting higher gross profit and lower operating expenses. For the six months ended June 30, 2024, Integrated Care Adjusted EBITDA increased by $38.6 million, or 53%, to $111.7 million, primarily reflecting higher gross profit and lower operating expenses.

Current wording

Integrated Care Adjusted EBITDA increased by $5.2 million, or 8%, to $68.0 million for the three months ended September 30, 2024, primarily reflecting higher gross profit and lower other operating expenses. For the nine months ended September 30, 2024, Integrated Care Adjusted EBITDA increased by $43.8 million, or 32%, to $179.7 million, primarily reflecting higher gross profit and lower other operating expenses.

Previous wording

BetterHelp total revenues decreased by $27.3 million, or 9%, to $265.0 million for the three months ended June 30, 2024, primarily driven by a 14% decrease in average monthly paying users. BetterHelp total revenues decreased by $37.6 million, or 7%, to $534.0 million for the six months ended June 30, 2024, primarily driven by a 13% decrease in average monthly paying users.

Current wording

BetterHelp total revenues decreased by $29.0 million, or 10%, to $256.8 million for the three months ended September 30, 2024, primarily driven by a 13% decrease in average monthly paying users. BetterHelp total revenues decreased by $66.6 million, or 8%, to $790.9 million for the nine months ended September 30, 2024, primarily driven by a 13% decrease in average monthly paying users.

Previous wording

BetterHelp Adjusted EBITDA decreased by $8.7 million, or 26%, to $25.5 million for the three months ended June 30, 2024, primarily reflecting the impact of revenues declining more than expenses. BetterHelp Adjusted EBITDA decreased by $10.9 million, or 21%, to $40.9 million for the six months ended June 30, 2024, again primarily reflecting the impact of revenues declining more than expenses.

Current wording

BetterHelp Adjusted EBITDA decreased by $10.7 million, or 41%, to $15.2 million for the three months ended September 30, 2024, primarily reflecting the impact of revenues declining more than expenses. BetterHelp Adjusted EBITDA decreased by $21.6 million, or 28%, to $56.1 million for the nine months ended September 30, 2024, primarily reflecting the impact of revenues declining more than expenses.

Previous wording

The following table presents a summary of our cash flow activity for the six months ended June 30, 2024 and 2023 (in thousands):

Current wording

The following table presents a summary of our cash flow activity for the nine months ended September 30, 2024 and 2023 (in thousands):

Previous wording

Our principal source of liquidity is our cash and cash equivalents, totaling $1,162.4 million as of June 30, 2024. During 2023, we experienced positive operating cash flow and we anticipate continuing positive operating cash flow results for 2024.

Current wording

Our principal source of liquidity is our cash and cash equivalents, totaling $1,243.9 million as of September 30, 2024. During 2023, we experienced positive operating cash flow and we anticipate continuing positive operating cash flow results for 2024.

Previous wording

See Note 9. “Convertible Senior Notes” to the condensed consolidated financial statements for additional information on our convertible senior notes.

Current wording

At September 30, 2024, we had outstanding convertible notes for an aggregate principal amount of $550.7 million due within the next 12 months. See Note 9. “Convertible Senior Notes” to the condensed consolidated financial statements for additional information on our convertible senior notes.

Previous wording

Cash flows provided by operating activities consisted of net loss adjusted for certain non-cash items and the cash effect of changes in assets and liabilities. Net cash provided by operating activities was $97.6 million for the six months ended June 30, 2024 compared to net cash provided by operating activities of $114.3 million for the six months ended June 30, 2023. The year-over-year change was primarily driven by higher incentive compensation payments, partially offset by growth in the business.

Current wording

Cash flows provided by operating activities consisted of net loss adjusted for certain non-cash items and the cash effect of changes in assets and liabilities. Net cash provided by operating activities was $207.8 million for the nine months ended September 30, 2024 compared to net cash provided by operating activities of $219.9 million for the nine months ended September 30, 2023. The year-over-year change was primarily driven by higher incentive compensation payments.

Previous wording

Cash used in investing activities was $63.3 million for the six months ended June 30, 2024, and $82.2 million for the six months ended June 30, 2023. Amounts for both periods relate to payments for capitalized software development costs associated with ongoing projects to continuously improve and optimize our products and services.

Current wording

Cash used in investing activities was $94.4 million for the nine months ended September 30, 2024, and $119.8 million for the nine months ended September 30, 2023. Amounts for both periods relate to payments for capitalized software development costs associated with ongoing projects to continuously improve and optimize our products and services.

Previous wording

Cash provided by financing activities for the six months ended June 30, 2024 was $5.6 million and $7.6 million for the six months ended June 30, 2023, reflecting lower proceeds from the employee stock purchase plan.

Current wording

Cash provided by financing activities for the nine months ended September 30, 2024 was $6.3 million and $12.6 million for the nine months ended September 30, 2023, primarily reflecting lower proceeds from the employee stock purchase plan.

Previous wording

Free cash flow was $34.3 million for the six months ended June 30, 2024, compared to $32.1 million for the six months ended June 30, 2023. The year-over-year change was driven by decreases in payments for capitalized expenditures and capitalized software development costs as well as growth in the business, offset by higher incentive compensation payments.

Current wording

Free cash flow was $113.4 million for the nine months ended September 30, 2024, compared to $100.1 million for the nine months ended September 30, 2023. The year-over-year change was driven by decreases in payments for capitalized expenditures and capitalized software development costs, offset by higher incentive compensation payments.