Teladoc Health, Inc.

Previous wording

Teladoc, Inc. was incorporated in the State of Texas in June 2002 and changed its state of incorporation to the State of Delaware in October 2008. Effective August 10, 2018, Teladoc, Inc. changed its corporate name to Teladoc Health, Inc. Unless the context otherwise requires, Teladoc Health, Inc., together with its subsidiaries, is referred to herein as “Teladoc Health,” the “Company,” or “we.” The Company’s principal executive office is located in Purchase, New York. Teladoc Health is the global leader in virtual care focused on forging a new healthcare experience with better convenience, outcomes, and value around the world.

Current wording

Teladoc, Inc. was incorporated in the State of Texas in June 2002 and changed its state of incorporation to the State of Delaware in October 2008. Effective August 10, 2018, Teladoc, Inc. changed its corporate name to Teladoc Health, Inc. Unless the context otherwise requires, Teladoc Health, Inc., together with its subsidiaries, is referred to herein as “Teladoc Health,” the “Company,” or “we.” In June 2025, the Company relocated its principal executive office from Purchase, New York to New York, New York. Teladoc Health is the global leader in virtual care focused on forging a new healthcare experience with better convenience, outcomes, and value around the world.

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 the THMG Association 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. However, certain health plans that have historically promoted our services to our employer Clients have developed, and may in the future continue to develop, solutions that replicate our services or offer competitive services at discounted prices to our current or prospective Clients, which could result in a loss of members. For further information, see “Risk Factors—Risks Related to Our Business and Industry—We operate in a competitive industry, and if we are not able to compete effectively, our business, financial condition, and results of operations will be harmed,” and “—A significant portion of our revenue comes from a limited number of Clients, the loss of which could have a material adverse effect on our business, financial condition and results of operations” included in our 2024 Form 10-K. U.S. Integrated Care members increased by 10.7 million, or 12%, to 102.5 million at March 31, 2025, compared to the same period in 2024.

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. Individuals who have paid access offer a greater margin than those who have visit fee only access and, over time, the mix of those who have paid access as compared to those who have visit fee only access has declined. 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 the THMG Association 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. However, certain health plans that have historically promoted our services to our employer Clients have developed, and may in the future continue to develop, solutions that replicate our services or offer competitive services at discounted prices to our current or prospective Clients, which could result in a loss of members. For further information, see “Risk Factors—Risks Related to Our Business and Industry—We operate in a competitive industry, and if we are not able to compete effectively, our business, financial condition, and results of operations will be harmed,” and “—A significant portion of our revenue comes from a limited number of Clients, the loss of which could have a material adverse effect on our business, financial condition and results of operations” included in our 2024 Form 10-K. U.S. Integrated Care members increased by 10.0 million, or 11%, to 102.4 million at June 30, 2025, compared to the same period in 2024.

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 virtual care platform that we believe positions us to drive greater engagement with our platforms and increased revenue. Chronic care program enrollment increased by 3% to 1.151 million at March 31, 2025, compared to 1.121 million at March 31, 2024.

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 virtual care platform that we believe positions us to drive greater engagement with our platforms and increase revenue. Chronic care program enrollment decreased by 5% to 1.117 million at June 30, 2025, compared to 1.173 million at June 30, 2024.

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 $1.27 in the three months ended March 31, 2025, compared to $1.38 in the same period in 2024.

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 $1.27 in the three months ended June 30, 2025, compared to $1.36 in the same period in 2024. Average monthly revenue per U.S. Integrated Care member was $1.27 in the six months ended June 30, 2025, compared to $1.37 in the same period in 2024.

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 this segment, and future revenue potential. Effectively reaching potential paying users through various advertising channels remains critical to our success. BetterHelp paying users decreased by 4% to 0.397 million for the three months ended March 31, 2025, compared to 0.415 million for the three months ended March 31, 2024.

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, including both those who pay directly out-of-pocket and those who utilize their insurance coverage. 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 this segment, and future revenue potential. Effectively reaching potential paying users through various advertising channels remains critical to our success. BetterHelp paying users decreased by 5% to 0.388 million for the three months ended June 30, 2025, compared to 0.407 million for the three months ended June 30, 2024, and decreased by 4% to 0.393 million for the six months ended June 30, 2025, compared to 0.411 million for the six months ended June 30, 2024.

Previous wording

The following table reconciles net loss, the most directly comparable GAAP financial measure, to Adjusted EBITDA for the three months ended March 31, 2025 and 2024 (in thousands):

Current 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, 2025 and 2024 (in thousands):

Previous wording

Revenue. The following table presents revenues disaggregated by revenue source and geography:

Current wording

Revenue. The following table presents revenues disaggregated by revenue source and geography for the three months ended June 30, 2025 and 2024:

Previous wording

Total revenue was $629.4 million for the three months ended March 31, 2025, compared to $646.1 million during the three months ended March 31, 2024, a decrease of $16.8 million, or 3%. This decrease in revenue was driven by lower revenue in our BetterHelp segment, partially offset by higher revenue in our Integrated Care segment. Other revenue predominately includes visit fees and, to a lesser extent, revenue from the sales of our telehealth solutions for hospitals and health systems.

Current wording

Total revenue was $631.9 million for the three months ended June 30, 2025, compared to $642.4 million for the three months ended June 30, 2024, a decrease of $10.5 million, or 2%. This decrease in revenue was driven by lower revenue in our BetterHelp segment, partially offset by higher revenue in our Integrated Care segment. The acquisitions of Catapult Health and Uplift increased total revenue for the three months ended June 30, 2025 by approximately 2 percentage points. Other revenue predominately includes visit fees and, to a lesser extent, revenue from the sales of our telehealth solutions for hospitals and health systems.

Previous wording

Cost of Revenue (exclusive of depreciation and amortization, which are shown separately below). Cost of revenue was $196.8 million for the three months ended March 31, 2025, compared to $194.5 million for the three months ended March 31, 2024, an increase of $2.3 million, or 1%. The increase was primarily driven by higher labor costs, technology costs, and amortization of devices, partially offset by lower physician costs.

Current wording

Cost of Revenue (exclusive of depreciation and amortization, which are shown separately below). Cost of revenue was $190.5 million for the three months ended June 30, 2025, compared to $188.1 million for the three months ended June 30, 2024, an increase of $2.5 million, or 1%. On a year-to-date basis, cost of revenue increased by $4.8 million, or 1%, to $387.4 million. The increase for both periods was primarily driven by higher labor costs, technology costs, and amortization of devices, offset by lower physician costs.

Previous wording

Advertising and Marketing Expenses. Advertising and marketing expenses were $168.2 million for the three months ended March 31, 2025, compared to $183.3 million for the three months ended March 31, 2024, a decrease of

Current wording

Advertising and Marketing Expenses. Advertising and marketing expenses were $167.5 million for the three months ended June 30, 2025, compared to $170.3 million for the three months ended June 30, 2024, a decrease of $2.7 million, or 2%. On a year-to-date basis, advertising and marketing expenses decreased by $17.9 million, or 5%, to $335.7 million. The decrease for both periods was driven mainly by lower digital and media advertising costs and lower employee compensation costs, partially offset by higher professional fees and conference costs.

Previous wording

Sales Expenses. Sales expenses were $48.7 million for the three months ended March 31, 2025, compared to $54.4 million for the three months ended March 31, 2024, a decrease of $5.7 million, or 10%. The decrease reflects lower employee compensation and commission costs, partially offset by higher costs for professional fees.

Current wording

Sales Expenses. Sales expenses were $50.0 million for the three months ended June 30, 2025, compared to $50.4 million for the three months ended June 30, 2024, a decrease of $0.5 million, or 1%. This decrease reflects lower employee compensation costs and professional fees, offset by higher commissions costs, travel costs, and software and infrastructure costs. On a year-to-date basis, sales expenses decreased by $6.2 million, or 6%, to $98.6 million. This reflects lower employee compensation costs, partially offset by higher commissions costs.

Previous wording

Technology and Development Expenses. Technology and development expenses were $70.0 million for the three months ended March 31, 2025, compared to $81.4 million for the three months ended March 31, 2024, a decrease of $11.4 million, or 14%. The decrease primarily reflects lower employee compensation costs.

Current wording

Technology and Development Expenses. Technology and development expenses were $68.8 million for the three months ended June 30, 2025, compared to $76.8 million for the three months ended June 30, 2024, a decrease of $8.0 million, or 10%. The decrease primarily reflects lower employee compensation costs, partially offset by higher infrastructure, hosting, and software license costs. On a year-to-date basis, technology and development expenses decreased by $19.4 million, or 12% to $138.7 million. The year-to-date decrease was primarily driven by lower employee compensation costs.

Previous wording

For the three months ended March 31, 2025 and 2024, research and development costs, which exclude amounts reflected as capitalized software development costs, were $22.9 million and $24.8 million, respectively.

Current wording

For the three months ended June 30, 2025 and 2024, research and development costs, which exclude amounts reflected as capitalized software development costs, were $22.1 million and $22.2 million, respectively. For the six months ended June 30, 2025 and 2024, research and development costs were $45.0 million and $47.0 million, respectively.

Previous wording

Goodwill Impairment. Concurrent with the completion of the acquisition of Catapult Health, we performed a goodwill impairment test on the Integrated Care reporting unit and determined that the carrying value of the reporting unit continued to exceed its fair value. As a result, we recognized an immediate impairment of $59.1 million of goodwill associated with the Catapult Health acquisition in the three months ended March 31, 2025. As the carrying value of the Integrated Care reporting unit continues to exceed its fair value, any future business combinations that would be part of the Integrated Care reporting unit could result in further goodwill impairment charges.

Current wording

Goodwill Impairment. Concurrent with the completion of the acquisition of Catapult Health, we performed a goodwill impairment test on the Integrated Care reporting unit and determined that the carrying value of the reporting unit continued to exceed its fair value. As a result, an immediate impairment of $59.1 million of goodwill associated with the Catapult Health acquisition was recognized in the three months ended March 31, 2025. As the carrying value of the Integrated Care reporting unit continues to exceed its fair value, any future business combinations that would be part of the Integrated Care reporting unit could result in further goodwill impairment charges.

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 $2.2 million and $0.4 million for the three months ended March 31, 2025 and 2024, 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 costs to integrate the operations of acquired operations and were $2.7 million and $0.5 million for the three months ended June 30, 2025 and 2024, respectively, and were $4.8 million and $0.8 million for the six months ended June 30, 2025 and 2024, respectively.

Previous wording

Restructuring Costs. Restructuring costs for the three months ended March 31, 2025 were $4.3 million, of which $3.6 million was for employee transition, severance, employee benefits, and related costs and $0.7 million was related to costs associated with office space reductions, including $0.2 million of right-of-use asset impairment charges.

Current wording

Restructuring Costs. Restructuring costs for the three months ended June 30, 2025 were $5.7 million, of which $5.4 million was for employee transition, severance, employee benefits, and related costs and $0.3 million was related to costs associated with office space reductions, including $0.1 million of right-of-use asset impairment charges. Restructuring costs for the six months ended June 30, 2025 were $10.0 million, of which $9.0 million was for employee transition, severance, employee benefits, and related costs and $1.0 million was related to costs associated with office space reductions, including $0.3 million of right-of-use asset impairment charges.

Previous wording

Restructuring costs for the three months ended March 31, 2024 were $9.7 million, of which $7.0 million was for employee transition, severance, employee benefits, and related costs and $2.7 million was related to other restructuring related costs.

Current wording

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 related to other restructuring related costs. Restructuring costs for the six months ended June 30, 2024 were $11.2 million, of which $8.3 million was for employee transition, severance, employee benefits, and related costs and $2.8 million was related to other restructuring related costs.

Previous wording

$95.1 million for the three months ended March 31, 2024, a decrease of $10.8 million, or 11%. The decrease was primarily driven by the lower amortization associated with the Livongo trademark, partially offset by an increase in the amortization of capitalized software development costs related to our investment in platforms.

Current wording

Amortization of intangible assets was $88.7 million for the three months ended June 30, 2025, compared to $94.9 million for the three months ended June 30, 2024, a decrease of $6.2 million, or 7%. Amortization of intangible assets was $173.0 million for the six months ended June 30, 2025, compared to $189.9 million for the six months ended June 30, 2024, a decrease of $17.0 million, or 9%. The decrease for both periods was primarily driven by the lower amortization associated with the Livongo trademark, partially offset by an increase in the amortization of capitalized software development costs related to our investment in platforms.

Previous wording

Interest Income. Interest income consisted of interest earned on cash and cash equivalents. Interest income was $12.7 million for the three months ended March 31, 2025, compared to $13.9 million for the three months ended March 31, 2024. The decrease was driven by lower interest rate yields.

Current wording

Interest Income. Interest income consisted of interest earned on cash and cash equivalents. Interest income was $10.1 million for the three months ended June 30, 2025, compared to $13.6 million for the three months ended June 30, 2024. Interest income was $22.7 million for the six months ended June 30, 2025, compared to $27.5 million for the six months ended June 30, 2024. The decrease for the three and six months ended June 30, 2025 was driven by lower interest rate yields and a lower average balance of cash and cash equivalents.

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 $5.8 million for the three months ended March 31, 2025, compared to $5.6 million for the three months ended March 31, 2024.

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 $4.5 million for the three months ended June 30, 2025, compared to $5.6 million for the three months ended June 30, 2024. Interest expense was $10.2 million for the six months ended June 30, 2025, compared to $11.3 million for the six months ended June 30, 2024. The decrease for the three and six months ended June 30, 2025 was driven by the maturation of the Livongo Notes and the 2025 Notes.

Previous wording

Other Expense (Income), net. Other expense (income), net was an income of $2.4 million for the three months ended March 31, 2025, compared to an expense of $0.4 million for the three months ended March 31, 2024, primarily reflecting the impact of foreign currency exchange rate fluctuations.

Current wording

Other Expense (Income), net. Other expense (income), net was an income of $8.4 million for the three months ended June 30, 2025, compared to an expense of $0.6 million for the three months ended June 30, 2024. Other expense (income), net was an income of $10.8 million for the six months ended June 30, 2025, compared to an expense of $0.9 million for the six months ended June 30, 2024. The change in both periods primarily reflects the impact of foreign currency exchange rate fluctuations.

Previous wording

Provision for Income Taxes. We recorded an income tax benefit of $18.3 million for the three months ended March 31, 2025, compared to $2.7 million income tax expense for the three months ended March 31, 2024. The tax benefit in 2025 resulted primarily from a discrete benefit of $20.1 million related to completion of a research and development tax credit study. The tax expense in 2024 was primarily due to a shortfall related to stock-based compensation awards that vested in the quarter.

Current wording

Provision for Income Taxes. We recorded an income tax benefit of $7.8 million for the three months ended June 30, 2025 compared to an income tax expense of $3.9 million for the three months ended June 30, 2024, and an income tax benefit of $26.0 million for the six months ended June 30, 2025 compared to an income tax expense of $6.6 million for the six months ended June 30, 2024. The tax benefit in 2025 resulted primarily from a discrete benefit of $20.1 million related to completion of a research and development tax credit study in the three months ended March 31, 2025 and $11.1 million from the current year's acquisitions, offset by ordinary tax expense of $5.0 million. The tax expense in 2024 was primarily due to a shortfall related to stock-based compensation awards that were vested during the year.

Previous wording

The following tables set forth the results of operations by segment for the three months ended March 31, 2025 and 2024 (dollars in thousands):

Current wording

The following tables set forth the results of operations by segment for the three and six months ended June 30, 2025 and 2024 (dollars in thousands):

Previous wording

Integrated Care cost of revenue, exclusive of depreciation, amortization, and stock-based compensation, increased by $10.7 million, or 9%, to $131.0 million for the three months ended March 31, 2025. The increase was primarily driven by higher labor costs, technology costs, and amortization of device costs, partially offset by lower physician costs.

Current wording

Integrated Care cost of revenue, exclusive of depreciation, amortization, and stock-based compensation, increased by $8.7 million, or 7%, to $126.4 million for the three months ended June 30, 2025, and increased by $19.4 million, or 8%, to $257.4 million for the six months ended June 30, 2025. For both periods, the increase was primarily driven by higher labor costs, technology costs, and amortization of device costs, partially offset by lower physician costs.

Previous wording

BetterHelp total revenues decreased by $29.1 million, or 11%, to $239.9 million for the three months ended March 31, 2025, driven by a 4% decrease in average monthly paying users.

Current wording

BetterHelp total revenue decreased by $24.6 million, or 9%, to $240.4 million for the three months ended June 30, 2025, and decreased by $53.8 million, or 10%, to $480.3 million for the six months ended June 30, 2025, driven by a 5% and a 4% decrease in average monthly paying users in the respective periods.

Previous wording

BetterHelp cost of revenue, exclusive of depreciation, amortization, and stock-based compensation, decreased by $7.6 million, or 10%, to $65.2 million for the three months ended March 31, 2025. The decrease was primarily driven by lower therapist costs.

Current wording

BetterHelp cost of revenue, exclusive of depreciation, amortization, and stock-based compensation, decreased by $5.5 million, or 8%, to $63.6 million for the three months ended June 30, 2025, and decreased by $13.0 million, or 9%, to $128.9 million for the six months ended June 30, 2025. For both periods, the decrease was primarily driven by lower therapist costs.

Previous wording

BetterHelp advertising and marketing, exclusive of stock-based compensation, decreased by $14.0 million, or 10%, to $133.0 million for the three months ended March 31, 2025, primarily reflecting lower spending on digital and media advertising, partially offset by higher professional fees.

Current wording

BetterHelp advertising and marketing, exclusive of stock-based compensation, decreased by $1.4 million, or 1%, to $134.3 million for the three months ended June 30, 2025, and decreased by $15.4 million, or 5%, to $267.3 million for the six months ended June 30, 2025, primarily reflecting lower spending on digital and media advertising, partially offset by higher professional fees.

Previous wording

The following table presents a summary of our cash flow activity for the three months ended March 31, 2025 and 2024 (in thousands):

Current wording

The following table presents a summary of our cash flow activity for the six months ended June 30, 2025 and 2024 (in thousands):

Previous wording

Our principal source of liquidity is our cash and cash equivalents, totaling $1,193.3 million as of March 31, 2025. We anticipate continuing positive operating cash flows for 2025.

Current wording

Our principal source of liquidity is our cash and cash equivalents, totaling $679.6 million as of June 30, 2025. We anticipate continuing positive operating cash flows for 2025.

Previous wording

Historically, we have financed our operations primarily through sales of equity securities, debt issuance, and bank borrowings.

Current wording

Historically, we have financed our operations primarily through sales of equity securities, debt issuance, and bank borrowings. On July 17, 2025, we entered into a five-year, $300.0 million revolving credit facility. We entered into the revolving credit facility to preserve and enhance our financial and operational flexibility, and we do not currently anticipate borrowing any amounts under the facility. See Note 17. “Subsequent Events” to the condensed consolidated financial statements for additional information on our revolving credit facility.

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 $15.9 million for the three months ended March 31, 2025 compared to net cash provided by operating activities of $8.9 million for the three months ended March 31, 2024. The year-over-year change was primarily driven by lower incentive compensation payments.

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 $107.4 million for the six months ended June 30, 2025 compared to net cash provided by operating activities of $97.6 million for the six months ended June 30, 2024. The year-over-year change was primarily driven by lower incentive compensation payments.

Previous wording

Cash used in investing activities was $123.3 million for the three months ended March 31, 2025, and $35.5 million for the three months ended March 31, 2024. We paid $64.6 million, net of cash acquired, to complete the acquisition of Catapult Health and paid $27.0 million to acquire securities of a private company during the three months ended March 31, 2025. The remaining change drivers primarily related to lower amounts paid 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 $183.0 million for the six months ended June 30, 2025, and $63.3 million for the six months ended June 30, 2024. We paid a total of $65.3 million, net of cash acquired, to purchase Catapult Health, paid $29.6 million for the net intangible assets associated with the Uplift acquisition, and paid $27.0 million to acquire the securities of a private company during the six months ended June 30, 2025. The remaining change drivers primarily related to lower amounts paid for capitalized software development costs associated with ongoing projects to continuously improve and optimize our products and services.

Previous wording

Free cash flow was an outflow of $15.7 million for the three months ended March 31, 2025, compared to an outflow of $26.6 million for the three months ended March 31, 2024. The year-over-year change was driven by decreases in incentive compensation payments and lower payments for capitalized software development costs, offset by higher capitalized expenditures.

Current wording

Free cash flow was $45.5 million for the six months ended June 30, 2025, compared to $34.3 million for the six months ended June 30, 2024. The year-over-year change was driven by decreases in incentive compensation payments and lower payments for capitalized software development costs, offset by higher capitalized expenditures.