So good afternoon, everyone. My name is Jess Tassan. I'm the healthcare services analyst at Piper, and I'm thrilled to be here with Jason Gorevic, CEO of Teladoc, the country's largest and most diversified digital healthcare platform, serving over 90 million DTC employer and payer lives. So Jason, welcome back to the Piper Conference, and thanks so much for taking the time. Thanks, Jess. I'm happy to be here. So I wanted to begin with my favorite segment, U.S. Integrated Care, where growth accelerated to 9.2% year-over-year in the third quarter, and led the company's 3Q 2023 Adjusted EBITDA beat, as segment margins expanded from 10.5% in 2Q to about 16.8% in 3Q. So just what drove the accelerating top-line momentum and profitability in U.S. Integrated Care in the third quarter? Yeah. So, if I step back, I would say we're pleased across the board with our third quarter results. We were within our guidance on revenue and significantly beat our guidance on Adjusted EBITDA. I think that reflects what we've been saying about a balanced approach to top-line and bottom-line growth. We've seen significant margin expansion over the course of the year as we've focused more on costs, but also driven strong growth. As you mentioned, Integrated Care was particularly strong in the quarter. That's really driven by primarily our Chronic Care performance, where Chronic Care enrollment, total program enrollment was up 13% year-over-year. That's a very strong result, and I think it's the result of a few things. One is we continue to sell more and more bundled services, where we're selling multiple Chronic Care programs into the same client. That yields better overall enrollment, both on a unique user basis as well as multi-program enrollment. And of course, that translates to better economics because our chronic care programs generally are a higher revenue per member, and also tend to operate at a higher margin, because they are truly digitally enabled. I think that makes sense. So can you maybe just help us understand the difference between bundled chronic care and Provider-Based Care, and when did the latter launch, if at all? Yeah. So bundled Chronic Care really means at a single price point, we're selling multiple programs into a client. I think that's reflective of one of our key competitive advantages, which is the breadth of our product portfolio, where a client can come to us for an entire cardiometabolic suite, or an entire cardiometabolic suite, along with Virtual Primary Care and mental health care. And what we see there is, at a single price point, we can sell multiple chronic care programs. That ends up being attractive to a broader population, and therefore, we get more unique users. But also, there's a benefit to getting people to engage in multiple chronic care programs. We're now at the point where more than one in three of our chronic care members is engaged with more than one of our programs. That yields really two benefits. One, better clinical outcomes, right? So better clinical outcomes drives better results for the client, and in many cases, we're going to clients saying, "Hey, we're willing to put our fees at risk for those clinical outcomes." The second thing it yields is greater retention. So once someone engages with multiple programs, they're more likely to stay with us for a longer period of time. Provider-Based Care can be a component of that. So Provider-Based Care is where we take our physician network, and we apply it to either our mental health care programs, which is where we started with Provider-Based Care, or one of our chronic care programs. So we went from Provider-Based Care and mental health to diabetes, to then hypertension, and now Weight Management, as we see the emergence of GLP-1s in the market, and clients really looking for a solution to help them manage that cost. Okay, so a lot there. That's extremely helpful. I think I heard you say 30% of eligibles are enrolled. Would you expect that number to tick higher as these bundled programs really proliferate? And then you mentioned also just that retention has improved as these bundled programs have become adopted in chronic care. Are you able to quantify that improved retention at all? And, is that trend expected to continue, so just sustained kind of improvement in chronic care retention? Yeah. So just to be clear, what I said is one in three people who are enrolled in a chronic care program are using more than one of our chronic care programs, not 30% of eligibles are enrolled. We haven't quantified publicly the increased retention rates. What I would say is: we're seeing increased retention rates across the board with respect to our chronic care programs, and that is directly attributable to that multiple program enrollment. We especially see that when people enroll in both a diabetes program and a hypertension program, or a diabetes program and a Weight Management program, they end up just having greater frequency of interaction with Teladoc Health, and that drives better Net Promoter Score and better retention. Got it. So when did Teladoc start marketing provider-based chronic care? And are we seeing this product in the strong sequential chronic care growth year- to- date, or is that more of a 2024 event? I think what we're most interested in is this your response to the proliferation of GLP-1s and kind of demand for a utilization management tool? So we and we introduced Provider-Based Care first with our mental health programs, where we said, "You can get therapy, and we can also bring in a psychiatrist who can prescribe SSRIs or something like that." Obviously, we have to be careful and not go to scheduled drugs. But so that started long before we ever did anything relative to the broader set of cardiometabolic chronic conditions. We then introduced it to our diabetes program so that a physician could help titrate medications for a member, again, before GLP-1s became all the rage that everyone wants to talk about. Certainly, the introduction of Provider-Based Care to our weight management programs, and especially Diabetes Prevention, that is absolutely in response to the proliferation of GLP-1s. And we're seeing a few things that I think are really notable. First of all, the entire gamut of experiences with respect to coverage, non-coverage, on formulary, off formulary, and specifically, whether people are fully embracing it. We see some employers say, "We're all in on GLP-1s. We need to treat for our employees." We see others saying, "I am terrified of the long-term cost of these medications," and kinda everything in between. I think the people who are coming to us for solutions recognize a couple of things. One, that GLP-1s by themselves are not a panacea that is sustainable from a cost perspective, right? And so they recognize that you have to have behavior change in terms of especially diet, nutrition, and activity in order to make this a sustainable program, where someone can go on a GLP-1, engage in significant lifestyle changes, and then wean off of those very expensive medications. I talk to CEOs all the time who are saying, "I expect my cost of GLP-1s to double or triple next year, and that just can't be sustainable." So they're coming to us for the broad set of capabilities that we have as a companion to a shorter duration on GLP-1s. The second thing we're seeing is, especially health plans, who are saying, "I need something to put alongside my prior auth program for these GLP-1s." So in order to get coverage to begin with or sustain coverage over time for these medications, someone has to engage in your Weight Management and/or Diabetes Prevention program. And we need proof that they're engaging over the long- term, so that it's not just a drug as the silver bullet. I think that's where we can play a significant role in the market and help our clients do what they're really looking for from all of our programs, which is improve clinical outcomes and contain their costs. I think that makes a lot of sense. So just to be clear, is Teladoc's provider-based chronic care platform capable of kind of shepherding someone through GLP-1 evaluation, procurement, titration, de-prescribing insulin, kind of the whole UM gamut? This solution is an answer. So I wouldn't describe us as a UM provider. I would say that we are certainly in the position where we can prescribe, manage, titrate, and help then ultimately wean them off of GLP-1s. Whether that has an impact on whether they're taking insulin or not is really very clinically dependent, and so I'm going to stop short of saying, you know, we're going to end the use of insulin. That would probably be an overreach for anybody to say. That's fair. So of the 90+ million U.S. Integrated Care members today, do you have any sense of how many have access to GLP-1s in 2023, and how many might in 2024? Well, somebody asked me today how many people are going to be on GLP-1s? Yeah. I'm not going to look into that crystal ball. Certainly, there's a lot that's evolving right now. I think a lot of it will depend on what does the cost of the medications look like over time. That will impact what's the treatment of health plans and employers relative to their formularies, their benefit structures, and those are going to have an impact on how many people really engage with them. So, you know, I'm going to leave that to other experts in the pharma area. That's fair. So, just with respect to the chronic care programs for hypertension, diabetes, Weight Management, should we think about those as, you know, according to the bundled offerings, all being priced essentially at parity, and then maybe some slight PMPM lift from the Provider-Based Care? When those are purchased on an individual basis, they have multiple price points. Right? So what we've done, however, with bundling, is be able to say: We're going to give you one price point for every enrollee, the same price point for every enrollee, regardless of how many of those programs or which programs they enroll in, right? And so that enables us to streamline the contracting process, we're talking about one price, and be able to go out to the population with a broad message about engaging in any of these programs without us having different economics, depending on where they engage. And it ultimately makes us aligned in our incentives with the client about engaging people across multiple programs, which, as we said, improves outcomes and retention rates. I think that makes a lot of sense from a commercialization perspective. So just as kind of testament to Teladoc's breadth and scale, and just the uniqueness of the platform, in 3Q, you added about 4.3 million U.S. Integrated Care members. As we understand it, these members didn't meaningfully contribute to reported results in the quarter. So kind of what were the circumstances surrounding this huge competitive win, and how should we expect contribution from those 4.3 million lives to ramp? Yeah. So, first I would say, we already had a relationship and a substantial membership base with that client. We had a competitor who faltered in the market, and we were able to step in for this client and take on that whole 4+ million members. The product for which that was servicing was essentially our General Medical virtual urgent care product for a Medicaid population. And as a result, is a relatively small contribution of revenue per member. That's why, as we said, it didn't have a significant contribution, at least not material, in terms of the overall context of our business. But where we see that being beneficial always is our land and expand strategy, right? So that's always our opportunity for a bigger footprint and then sell additional products and services into the client for that population. So we hope that, that revenue will continue to grow for that same population over time. It certainly cements and improves our relationship with that client. There's nominal economics from it, but I think the fact that about 3/4 of our sales come from existing clients is really a testament to that land and expand strategy, and it's how we've been able to then take advantage of really what is, I think, an underappreciated, competitive moat in that 90 million members who have access to our platform. Okay, that's super helpful color. Within Integrated Care, fourth quarter guidance calls for, I know Mala is not here, but fourth quarter guidance calls for sustained high single-digit year-over-year growth in U.S. Integrated Care, but suggests that margins are going to contract from about 17% in 3Q to about 12%. We know there were some one-time performance related revenues recognized in 3Q, but what else is driving the anticipated margin contraction, and are these one-time investments or kind of structural costs? Yeah. So, a few things in there. One, as you mentioned, we had about a $4 million gain in Q3 from a performance payment that we realized in Q3. That's a one-time thing. We do think that performance related relationships and the economics that will benefit us will continue to grow into the future. In the fourth quarter, there are a few things that I think are important. One, fourth quarter tends to be seasonally higher, cold and flu season, higher infectious diseases drive higher visits, you know, General Medical visits. Those are inherently lower gross margin, therefore, lower net margin. Just puts a little bit of contraction on our Q4 margins versus our Q3 margins. That's a good thing, right? In terms of just the health of the business and us being there for our members. The second thing is, we generally spend in the fourth quarter ahead of first quarter implementations, right? So as we go live with a population on 1/1, we want to get ahead of that in Q4 by engaging that population so that we hit the ground running. So there tends to be expenses that we recognize in the fourth quarter, that we don't see revenue until the first quarter. So there's just a higher expense base. And I think, you know, overall, if you look at the entire year, which is what I would encourage you to do, you'll see material margin expansion across the business, and that's very intentional as we look to get leverage out of the P&L. So last question on Integrated Care. Where do you expect this business to be in maybe five years, from, you know, a member perspective, a PMPM perspective, and a margin, any qualitative commentary on a margin perspective? Yeah. So look, five years is an eternity in our business. I would say this, people ask me frequently, like, "Jason, what will we be surprised about the business five years from now?" I think you'll be surprised that when you ask people where they get their healthcare, their answer is Teladoc Health. Not where do you get your diabetes management program, not where do you get your, you know, virtual urgent care, not where are you going for virtual mental health care, but where are you going for your healthcare? Like, who's your healthcare partner, writ large? And I think that's the role and the opportunity that the integrated care business has to play in the healthcare system. It's almost like this sort of Uber multi-specialty clinic without walls that can be ubiquitous across the country and across clinical specialties. And really, that's the vision for our Whole Person Care. I think in terms of margin, you're going to continue to see us expand margins in the business for the foreseeable future. I'm not going to quantify, you know, how much on an annual basis or for what duration or what's a terminal margin there, but we are very focused, as we've said, on the balance of margin expansion and continued top line growth. The business has significant scale at this point. We will continue to leverage sort of the middle of the P&L, but we also continue to get economies of scale across, you know, areas. We've seen gross margins be, I would say, most external parties should say, astoundingly resilient as we've continued to scale, and in the face of medical economics being challenging relative to the cost of labor and things like that. So you'll continue to see the margin of that business expand. Awesome. I think we are very excited about that part of the business. I want to move on to BetterHelp. In the BetterHelp segment, Teladoc delivered healthy 8% year-over-year revenue growth and a 9% Adjusted EBITDA margin in 3Q. In 4Q, the segment is expected to deliver low to mid-single digit revenue growth and a 22.5% Adjusted EBITDA margin at the midpoint. So this guidance largely parallels the results Teladoc delivered in 4Q 2022, but, to put it bluntly, how is Teladoc going to pull it off this year? Look, I mean, I think people have a hard time sometimes understanding just the cadence and the investment, the investment cadence, cadence, and the seasonality of the BetterHelp business. And we've also done some different things as we've seen different dynamics in the ad market, right? So last year, we pulled back on ad spend in the first half because of a challenging environment. We spent more than half of our spend in the back half of the year. This year, it's the opposite of that. So there's a little bit of challenge relative to, I don't know, lapping of quarter to quarter. So first thing I would always say about BetterHelp is, I'd suggest looking at it on an annual basis more than a quarterly basis. I think that, like, you try to look at that business on a quarter by quarter basis, and you're subject to, like, the levers that we're pulling on a daily basis and weekly basis relative to our ad spend, and depending on what the ad and customer acquisition cost environment is. So I would say that's the biggest thing. We always pull back on, l ike, this time of the year is the most expensive time of the year to advertise, so we always pull back on ad spend at this time of the year. There were a couple of exceptions in, like, the height of the pandemic, when that wasn't the case. But you know, for the last two years, we've seen that, and so you know, that's the biggest line item of cost in the P&L. So as we pull back on that at this time of the year, you just naturally get the margin expansion in the fourth quarter. And so I, I would encourage people to look at it on an annual basis. And then, you know, you should expect to see us reinvest in the beginning of the year as we get into- we get out of the holiday season, ad costs come down, and we get into the New Year's resolution season, where people are more receptive. And so, you know, you'll continue to see that. And then, so, so what we said on the call was, "Don't expect the fourth quarter trend to be indicative of what the 2024 trend is going to be. I think that that's really helpful and something I wanted to focus on. So in 4Q, BetterHelp is expected to grow low- to mid-single digits due to the cadence of ad spend in 2023. Mala told us on the 3Q call that 4Q BetterHelp revenue growth guidance is not indicative of underlying growth in that business. So, should investors think about the 2023 overall year-over-year growth rate for BetterHelp as being indicative of the underlying growth in that business? So we're modeling 11.6%, and I think guidance is low double digits year-over-year o r is it somewhere in between? No. So, look, I'm not going to give guidance for 2024, but I think, yes, you should look at 2023 full year as more indicative of what 2024 will be like. That's really helpful. And, please give me credit for a valiant attempt. But, so is BetterHelp a margin expansion story from here at about 12.5% in 2023? Or just given its scale, is the future of this business kind of a fight to flat on the Adjusted EBITDA margin side? No, I think we'll continue to focus across the business on margin expansion. I think there's naturally more room for margin expansion in a B2B business, where you get significant leverage, you have long tenure of your clients. Like, that's just sort of a normal thing. But we will continue to expand margins on both segments of the business. That's very helpful. Last one on BetterHelp, any fundamental changes in the BetterHelp business that you'd call out in terms of net realized price, retention, or revenue per member? We're basically trying to understand if kind of BetterHelp advertising ROI is stable year-over-year. Yeah. So I would say a couple of things. Retention continues to get better, LTV continues to get better, and actually, we're seeing strong resilience in terms of pricing. Where we've seen challenges is in the customer acquisition cost, right? And I think we've been pretty public about this. We said, top of our range assumes that there'll be an improvement in the customer acquisition cost. Bottom end of the range means it stays sort of stubbornly a little bit worse than our expectations for the year, and that's where it's been, right? It's just stayed a little worse than our expectations for the year. Now, let me be clear: That's a significant improvement over what it was last year, right? So if you look at, w e had 500 basis points of margin expansion in Q3 of this year versus Q3 of last year. Like, we're improving margins. The customer acquisition cost came down versus what we saw as a spike and then a moderation in the back half of the year, in customer acquisition costs last year. They've improved since then. They're slightly worse than our expectations, and we're doing a lot to experiment with new channels, new markets, and new techniques in order to continue to moderate the customer acquisition costs, and then, you know, get a little bit more yield on our, on our ad spend. That's really helpful. So I'm going to switch to two last enterprise questions. So on the 3Q call, 2023 bookings were described as flat to slightly up year-over-year with stable retention. So at the time of the 3Q call, would you have had complete visibility into the 2024 selling season, or is it possible that some upside could materialize in the last couple of months of the year? So no, I mean, the fourth quarter is an important quarter from, with respect to bookings. Based on my outlook now, I'd say I expect our bookings to be up in the range of 10% this year versus last year. So that's positive. It's on the back of strong Chronic Care sales, strong multi-product sales. So, you know, we feel good about that. And again, just as a reminder, that's all on the Integrated Care side of our business. And so I feel good about where we are, and we've got a couple of weeks left in the selling season, so, you know, anything can happen. But, you know, but I feel good about where our bookings are. Okay, that's very helpful. I guess maybe to round things out, in your conversations with investors, what do you think is the most underappreciated part of the Teladoc story, and is 2024 the turning point to kind of, you know, bring the market into the light? Yeah, look, I'm sure I'm not the only CEO who gets frustrated by the quarter-to-quarter focus. I think investors, many times fail to step back and look at the bigger picture opportunity and the role that we can play. The value of that 90 million member installed base and our track record of selling additional products and services into that installed base to continue to bring more value to our clients and get more economic value for the company and our shareholders. Then lastly, I think, to be honest, I feel frustrated that we haven't gotten more credit for improving our bottom line performance and doing what we've said we were going to do, which is balancing our growth on the top line and bottom line, and expanding margins, and getting real leverage and scale out of the business. I think that's reflective of the financial strength of the business and our maturity into the next phase for the company, which is really driving significant cash flows, margin expansion, leveraging the fact that we have a strong balance sheet, and being able to be the beneficiary as others in the market shake out and can't compete. That's quite a few things that we're not appreciating just yet. But appreciate the time. Thank you so much, Jason. Thank you so much for joining us, and thanks, everyone.