TDOC 10-K & 10-Q changes, risk factors and insider trading

•risk of the loss of any of our significant Clients or partners, or the loss of a significant number of members or BetterHelp paying users;

•our ability to operate in the heavily regulated healthcare industry, and comply with regulations concerning data privacy, including personally identifiable informationPII and personal health informationPHI;

•our expectations and management of potential growth, including our ability to introduce new products, markets and any change in product or revenue mix that impacts our profitability;

•our dependence on a limited number of third-party suppliers for timely access to materials, and the risk of supply chain disruptionsdisruptions, imposition or expansion of tariffs or further cost inflation;

We have incurred significant losses in each period since our inception. We incurred net losses of $1,001.2$200.3 million and $220.4$1,001.2 million for the years ended December 31, 20242025 and 2023,2024, respectively. The net loss for the year ended December 31, 20242025 included a non-cash goodwill impairment chargecharges oftotaling $790.0$71.8 million as discussed further below. As of December 31, 2024,2025, we had an accumulated deficit of $16,229.9$16,430.2 million. These losses and accumulated deficit reflect the large non-cash impairment chargecharges for our goodwill and the substantial investments we have made to expand our business and scope of services, acquire new Clients and members, build our proprietary network of healthcare providers, and develop our technology platform.services. We cannot assure you that we will achieve profitability in the future or that, if we do become profitable, we will be able to sustain or increase profitability. Our prior losses, combined with our expected future losses, have had and will continue to have an adverse effect on our stockholders’ equity and working capital. As a result of these factors and cash flow needs, we may need to raise additional capital through debt or equity financings to fund our operations, and such capital may not be available on reasonable terms, if at all.

Historically, we have relied on a limited number of Clients for a substantial portion of our total revenue. For the years ended December 31, 20242025 and 2023,2024, our top five Clients by revenue accounted for 18%19% and 19%18% of our total revenue, respectively, and 31% and 34% of our Integrated Care segment revenue,revenue respectively.for both years ended December 31, 2025 and 2024. In addition, 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 couldhas resultresulted in a loss of Clients, includingand ourmay largestresult in the loss of additional Clients. The further loss of any of our key Clients, or a failure of some of them to renew or expand their relationships with us, could have a significant impact on the growth rate of our revenue, profitability, and our reputation. In addition, mergers and acquisitions involving our Clients could lead to cancellation or non-renewal of our contracts with those Clients or by the acquiring or combining companies, thereby reducing the number of our existing and potential Clients and members.

On October 1, 2024,2025, we performed our annual goodwill impairment test and determined that, while there was a significant excess ofthat the BetterHelp reporting unit’s fair value overexceeded its carrying value,value and the Integrated Care reporting unit’s fair value was less thanapproximated its carrying value. If we complete any acquisitions of businesses that would be included in the Integrated Care reporting unit, including the acquisition of Catapult Health, LLC (“Catapult Health”), some or all of any goodwill associated with the acquisition could be subject to an immediate impairment depending on the Integrated Care segment’s then-current fair value. In the event there are further adverse changes in our projected cash flows and/or further changes in key assumptions, including but not limited to an increase in the discount rate, lower revenue growth, lower margin, and/or a lower terminal growth rate, we may be required to record additional non-cash impairment charges to our goodwill or other intangibles and/or long-lived assets.assets that we hold or acquire in the future. If the carrying value of the Integrated Care reporting unit exceeds its fair value as of the date of any future business combinations, the future business combinations that would be part of the Integrated Care reporting unit could result in further goodwill impairment charges. Such non-cash charges could have a material adverse effect on our consolidated statements of operations and balance sheets in the reporting period of the charge.

The virtual care market is developing and volatile, and if it does not continue to develop, if it develops more slowly than we expect, if it encounters negative publicity, or if our solutions do not drive member engagement, the growth of our business will be harmed.

The virtual care market is competitive, and we expect it to continue to attract increased competition, which could make it difficult for us to succeed. We currently face competition in the virtual care industry for our solutions from a range of companies, including specialized software and solution providers that offer competitive solutions, often at substantially lower prices, and that are continuing to develop additional products and becoming more sophisticated and effective. Aside from other competing virtual care companies and smaller industry participants, we also face competition from companies that offer solutions for mental health and management of chronic conditions, and enterprise companies who are focused on or may enter the healthcare industry, including initiatives and partnerships launched by these large companies. In addition, large, well-financed health plans, technology companies and retailers have in some cases developed or acquired their own tools and may provide these solutions to their customers at discounted prices. Competition from these parties has and may continue to result in a loss of Clients and will result in continued pricing pressures, which is likely to lead to price declines in certain product segments, and which could negatively impact our sales, profitability, and market share. Increased competition has also resulted in elongated sales cycles for certain products, including chronic condition management solutions, which may continue to reduce our growth and could negatively impact our sales, profitability, and market share.

We expect to continue to derive a significant portion of our revenue from the renewal of existing Client contracts and sales of additional applications and services to existing Clients. As part of our growth strategy, for instance, we have focused on expanding our services amongst current Clients. As a result, selling additional applications and services are critical to our future business, revenue growth, and results of operations.

We generally enter into contracts with our Clients for a subscription access or usagevisit fee. Most of our Clients have no obligation to renew their contracts for our solutions after the initial term expires. In addition, our Clients may negotiate terms less advantageous to us upon renewal, which may reduce our revenue from these Clients. Individuals who have paid subscription access offer a greater margin than those who have visit fee only access and, over time, the mix of those who have paid subscription access as compared to those who have visit fee only access has declined. Any further increase in the portion of our revenue derived from visit fee only access would likely adversely impact our growth and profitability and could reduce our revenue. Our future results of operations also depend, in part, on our ability to expand into new clinical specialties and across care settings and use cases. If our Clients fail to renew their contracts, renew their contracts upon less favorable terms or at lower fee levels, or fail to purchase new products and services from us, our revenue may decline, or our future revenue growth and profitability may be constrained.

Similarly, individual members who utilize our BetterHelp or Uplift Health Technologies, Inc. (“Uplift”) services have no obligation to renew their subscriptions, and the number of BetterHelp paying users has been declining in recent periods. In 2024,2025, BetterHelp paying users decreased by 11%5% to 0.410.39 million. Failure of additional BetterHelp paying users to renew their subscriptions could cause the revenue of our BetterHelp segment to further decline or constrain any future growth.

There is no guarantee that we will possess the resources, either financial or personnel, for the research, design, and development of new applications or services, or that we will be able to utilize these resources successfully and avoid technological or market obsolescence. Further, there can be no assurance that technological advancesadvances, including with respect to AI and machine learning, by one or more of our competitors or future competitors will not result in our present or future applications and services becoming uncompetitive or obsolete. If we are unable to enhance our offerings and network capabilities to keep pace with rapid technological and regulatory change, or if new technologies emerge that are able to deliver competitive offerings at lower prices, more efficiently, more conveniently, or more securely than our offerings, our business, financial condition, and results of operations could be adversely affected.

The growthdevelopment of our business in recent years has strained our business, technology, operations, and employees, and we anticipate that our Integrated Care segment operations will continue to expand.employees. To manage our current and any anticipated future growth effectively, we must continue to maintain and enhance our information technology infrastructure, financial and accounting systems, and controls. For example, we have upgraded our customer relationship management (“CRM”) and enterprise resource planning (“ERP”) systems in connection with our acquisition and integration activities, and implemented a new EMR system for certain products. Any expected benefits from these systems will be gradual or may not be realized at all, and there have been, and in the future could be integration issues or inefficiencies as operators learn the new system. In addition, the introduction of a new system can lead to errors and loss of data or may not work as intended. The integration process between new and legacy systems may lead to temporary manual processes and possible data integrity issues. If our data were found to be inaccurate or unreliable due to error or fraud, or if we, or any of the third-party service providers we engage, were to fail to maintain information systems, including our new EMR system,systems and data integrity effectively, we may not achieve the intended benefits of the new system and could experience operational disruptions that may impact our members and providers and hinder our ability to provide services, retain and attract members, and manage our member risk profiles. We must also attract, train, and retain a significant number of qualified sales and marketing personnel, customer support personnel, professional services personnel, software engineers, technical personnel, finance and accounting personnel, and management personnel, and the availability of such personnel, in particular software engineers, may be constrained. Additionally, our growth strategy requires the collection, storage, and analysis of a high volumes of data from internal and external sources. Failure to effectively utilize our current data or establish and integrate new systems of data capture may adversely impact our ability to achieve our strategic goals and business plans.

We are continually executing a number of growth initiatives, strategies and operating plans designed to enhance our business, including the introduction of new products and solutions, the expansion of BetterHelp into additional international markets and pursuing insurance coverage for BetterHelp in the U.S.. The anticipated benefits from these efforts are based on several assumptions that may prove to be inaccurate. Moreover, we may not be able to successfully complete these growth initiatives, strategies, and operating plans and realize all of the benefits, including growth targets and cost savings, that we expect to achieve, or it may be more costly to do so than we anticipate. A variety of risks could cause us not to realize some or all of the expected benefits. These risks include, among others, delays in the anticipated timing of activities related to such growth initiatives, strategies and operating plans, increased difficulty and cost in implementing these efforts, including difficulties in complying with new regulatory requirements, and the incurrence of other unexpected costs associated with operating the business. Moreover, our continued implementation of these programs may disrupt our operations and performance. As a result, we cannot assure you that we will realize these benefits. If, for any reason, the benefits we realize are less than our estimates or the implementation of these growth initiatives, strategies and operating plans adversely affect our operations or cost more or take longer to effectuate than we expect, or if our assumptions prove inaccurate, our business, financial condition, and results of operations may be materially adversely affected.

Recently weWe have implementedcontinued to implement operational excellence initiatives which include a number of restructuring, realignment and cost reduction initiatives. We may not realize the benefits of these initiatives to the extent or on the timing we anticipated and the ongoing difficulties in implementing these measures may be greater than anticipated and/or offset by inflationary pressures, which could cause us to incur additional costs. In addition, if these measures are not successful or sustainable, we may undertake additional realignment and cost reduction efforts, which could result in significant additional expenses and adversely impact our ability to achieve our other strategic goals and business plans.

Our success is dependent upon our continued ability to maintain a network of qualified providers, and demand for such providers in both our Integrated Care and BetterHelp segments has become increasingly competitive. In order to ensure predictable availability of providers and a consistent member experience, we expect that the THMG Association will continue to hire more employed providers and rely less on contractors. If the THMG Association isand the Uplift Association are unable to recruit and retain board-certified physicians, advanced practice providers, mental health providers, and other healthcare professionals, or unable to augment itstheir employee basebases with contractors to meet resource needs, it would adversely affect our business, financial condition, results of operations, and ability to grow. In any particular market, providers could demand higher payments or take other actions that could result in higher medical costs, less attractive and reliable service for our Clients and members, or difficulty meeting regulatory or accreditation requirements.

Our ability to develop and maintain satisfactory relationships with providers also may be negatively impacted by other factors not associated with us, such as state therapist or psychiatrist licensing laws and standard of care requirements, international credentialing requirements, changes in Medicare and/or Medicaid reimbursement levels and other pressures on healthcare providers and consolidation activity among hospitals, physician groups, and healthcare providers. The failure to maintain or to secure new cost-effective provider contracts may result in a loss of or inability to grow our membership base, higher costs, healthcare provider network disruptions, less attractive service for our Clients and members, and/or difficulty in meeting regulatory or accreditation requirements, any of which could have a material adverse effect on our business, financial condition, and results of operations.

Failure to adequately develop our direct sales force could impede our growth.ability to grow.

We believe that our future growth will depend on the continued development of our direct sales force and our ability to obtain new Clients and to manage our existing Client base. Identifying and recruiting qualified personnel and training them requires significant time, expense, and attention. It can take six months or longer before a new sales representative is fully trained and productive. Our business may be adversely affected if our efforts to train our direct sales force do not generate a corresponding increase in revenue. In particular, if we are unable to hire and develop sufficient numbers of productive direct sales personnel or if new direct sales personnel are unable to achieve desired productivity levels in a reasonable period of time, sales of our services will suffer, and our growthability to grow will be impeded.

Economic downturns, market volatility, inflationinflation, tariffs, and uncertainty make it potentially very difficult for our Clients and us to accurately forecast and plan future business activities. During challenging economic times, our Clients may have difficulty gaining timely access to sufficient credit or obtaining credit on reasonable terms, which could impair their ability to make timely payments to us and adversely affect our revenue. If that were to occur, our financial results could be harmed. Furthermore, we have Clients in a variety of different industries. A significant downturn in the economic activity attributable to any particular industry may cause organizations to react by reducing their capital and operating expenditures in general or by specifically reducing their spending on healthcare matters, including chronic care and mental health solutions. In addition, our Clients may delay or cancel healthcare projects or seek to lower their costs by renegotiating vendor contracts. To the extent purchases of our solutions are perceived by Clients and potential Clients to be discretionary, our revenue may be disproportionately affected by delays or reductions in general healthcare spending. Also, competitors may respond to challenging market conditions by lowering prices and attempting to lure away our Clients or members.

Similarly, economic conditions may impact the ability of our members to pay for our BetterHelp services, particularly if such services are perceived by members to be discretionary and too expensive, new users continue to declineexpensive or if we are unsuccessful in obtainingour efforts to obtain insurance coverage for BetterHelp in theall U.S. states and territories. For example, BetterHelp paying users decreasedcontinued to decrease during 2024,2025, and any further decrease in, or reduction in growth of, the number of paying users who utilize our BetterHelp services would negatively impact our business, financial condition and results of operations.

Further, challenging economic conditionsconditions, including as a result of increased inflation, may impair the ability of our Clients to pay for the applications and services they already have purchased from us and, as a result, our write-offs of accounts receivable could increase. We cannot predict the timing, strength, or duration of any economic slowdown or recovery. If the condition of the general economy or markets in which we operate worsens, our business, financial condition, and results of operations could be harmed.

Despite the terms in our supply agreements, our suppliers may encounter problems that limit their ability to supply products to us, including financial difficulties, further imposition of tariffs that impact the suppliers' ability to perform their obligations or significantly increase the amount we pay, labor shortages, shutdowns related to a pandemic or other emergency, shipping delays, or damage to their manufacturing equipment or facilities. As a result, our ability to purchase adequate quantities of our products may be limited. If we fail to obtain sufficient quantities of high-quality components to meet demand on a timely basis, we could lose Clients or members, our reputation may be harmed, and our business could suffer. For certain of our contracts, we have obligations to provide a blood glucose meter and other supplies to new members within a certain specified period of time, and/or to provide replacements for defective blood glucose meters within a certain specified period of time. If we are regularly unable to meet those obligations, our channel partners, resellers, or Clients may decide to terminate their contracts.

•requirements of foreign laws and other governmental controls, including compliance challenges related to the complexity of multiple, conflicting and changing governmental laws and regulations, including employment, healthcare, tax, privacy, consumer protection, and data protection laws and regulations;

Our overall success in international markets depends, in part, on our ability to anticipate and effectively manage these risks and there can be no assurance that we will be able to do so without incurring unexpected costs. If we are not able to manage the risks related to our international operations, our business, financial condition, and results of operations may be materially adversely affected. As of our efforts to expand BetterHelp into additional international markets continues, the risks described above may continue to grow as well.

Our success depends largely upon the continued services of our key executive officers and other senior leaders, and on our ability to attract and retain qualified leaders. These individuals are at-will employees and therefore they may terminate employment with us at any time with no advance notice. In connection with the hiring of our new chief executive officer and subsequent changes to our operational structure, weWe have had several recent executive transitions inand 2024. Therethere may be additional changes in our senior management team resulting from the hiring or departure of executives or other key employees or from additional changes to our operational structure, which could disrupt our business. The replacement of one or more of our executive officers or other key employees would likely involve significant time and costs and may significantly delay or prevent the achievement of our business objectives.

We cannot predict the likelihood, timing or effect of future transitions among our senior leadership. The loss of the services of our executive officers or other key employees, or inability to attract and retain qualified leaders, could impede the achievement of our objectives and harm our ability to successfully implement our business strategy. For example, certain of our employees have taken on increased responsibilities in lightconnection ofwith thischanges turnover,to our operational structure over the past several years, which could divert attention from key business areas, and the realignment of our leadership structure could result in a lack of clear ownership for key products and processes.

To continue to execute our growth strategy, we also must attract and retain highly skilled personnel. However, competition in the job market is intense for a limited pool of qualified professionals. Inability to meet the ever-increasing expenses (including salaries, benefits and technology costs, and talent inflationcosts) of attracting and retaining talent may threaten our ability to provide the staffing resources needed to execute our growth strategy. We have from time to time in the past experienced, and we expect to continue to experience in the future, difficulty in hiring and retaining highly skilled personnel with appropriate qualifications. The pool of qualified personnel with experience working in the healthcare market is limited overall. In addition, many of the companies with which we compete for experienced personnel have greater resources than we have.

We are dependent on our ability to recruit, retain and develop a very large and diverse workforce. We must evolve our culture in order to successfully grow our business.

In addition, we rely on relationships for our BetterHelp business with a wide variety of third parties, including internet search providers such as Google, social networking platforms such as Facebook, internet advertising networks, co-registration partners, retailers, distributors, television advertising agencies, and direct marketers, to source new members and to promote or distribute our services and products. If these third parties and social networking platforms materially change how they permit companies to advertise with them, it could materially adversely affect our business, financial condition and results of operations. Also, in connection with the launch of new services or products, features or markets for our BetterHelp business, including our expansion of insurance coverage and new international markets, we have spent, and may spendcontinue to spend, a significant amount of resources on marketing, which could divert resources from marketing efforts for our coretraditional BetterHelp service, which could lead to a decrease in the acquisition of new paying users for that service. The ability of our advertising spend to efficiently attract new members and increase engagement of current members has led to a decline in visit volume and revenue. If our marketing activities are inefficient or unsuccessful, if important third-party relationships or marketing strategies, such as internet search engine marketing and search engine optimization, become more expensive or unavailable, or are suspended, modified, or terminated, for any reason, if there is an increase in the proportion of individuals visiting our websites or purchasing our services by way of marketing channels with higher marketing costs as compared to channels that have lower or no associated marketing costs or if our marketing efforts do not result in our services being prominently ranked in internet search listings, our business, financial condition, results of operations, and cash flows could be materially and adversely impacted.

Our operations have consumed substantial amounts of cash since inception and we intend to continue to make significant investments to support our growth, respond to business challenges or opportunities, develop new applications and services, enhance our existing solutions and services, enhance our operating infrastructure, and potentially acquire complementary businesses and technologies. For the years ended December 31, 20242025 and 2023,2024, our net cash provided by operating activities was $293.7$294.4 million and $350.0$293.7 million, respectively. As of December 31, 2024,2025, we had $1,298.3$781.1 million of cash and cash equivalents which are held for working capital purposes, capital expenditures, and other corporate purposes. On the May 15, 2025 maturity date, we paid $0.6 million to settle the outstanding principal amount of 1.375% convertible senior notes due 2015 and, on the June 1, 2025 maturity date, we paid $550.0 million to settle the outstanding principal amount of 0.875% convertible senior notes due 2025 that were issued by Livongo Health, Inc. for which we agreed to assume all of Livongo's rights and obligations. As of December 31, 2024,2025, we had outstanding $1,000.0 million of 1.25% convertible senior notes due 2027 (the “2027 Notes”), $0.7 million of 1.375% convertible senior notes due 2025 (the “2025 Notes”), and $550.0 million of 0.875% convertible senior notes due 2025 that were issued by Livongo Health, Inc. ("Livongo") for which we agreed to assume all of Livongo's rights and obligations (the "Livongo Notes," and together with the 2027 Notes and 2025 Notes, the "Notes").

We may be required to use a substantial portion of our cash flows from operations to pay interest and principal on our indebtedness. An aggregate principal amount of $550.7 million of the Notes is due in 2025. Our ability to make scheduled payments of the principal of, to pay interest on, or to refinance our indebtedness, including the Notes, depends on our future performance, which is subject to economic, financial, competitive, and other factors beyond our control. Such payments will reduce the funds available to us for working capital, capital expenditures, and other corporate purposes and limit our ability to obtain additional financing for working capital, capital expenditures, expansion plans, and other investments, which may in turn limit our ability to implement our business strategy, heighten our vulnerability to downturns in our business, the industry, or in the general economy, limit our flexibility in planning for, or reacting to, changes in our business and the industry, and prevent us from taking advantage of business opportunities as they arise. Our business may not continue to generate cash flow from operations in the future sufficient to service our debt, make necessary capital expenditures and fund our operations. If we are unable to generate such cash flow, we may be required to adopt one or more alternatives, such as selling assets, restructuring debt, or obtaining additional equity capital on terms that may be onerous or highly dilutive. If we are unable to engage in any of these activities or engage in these activities on desirable terms, it could result in a default on our debt obligations, which would adversely affect our business, financial condition, and results of operations. We may settle conversions of the Notes through payment or delivery, as the case may be, of cash, shares of our common stock, or a combination of cash and shares of our common stock. The amount of cash paid, or number of shares delivered, in connection with any conversion may be material and could result in a significant depletion in the cash available to fund our operations or significant dilution to our stockholders.

At December 31, 2024,2025, we had $1,298.3$781.1 million in cash and cash equivalents. Our investments may also include commercial paper, securities issued by the U.S. government obligations, bank deposits, and money market funds meeting the criteria of our investment policy, which is focused on the preservation of our capital.capital and liquidity. These investments are subject to general credit, liquidity, and market and interest rate risks, particularly in the current economic environment. We may realize losses in the fair value of these investments or a complete loss of these investments, which would have a negative effect on our consolidated financial statements. In addition, should our investments cease paying or reduce the amount of interest paid to us, our interest income would suffer. The market risks associated with our investment portfolio may have an adverse effect on our results of operations, liquidity and financial condition.

Our offices may be harmed or rendered inoperable by natural or man-made disasters, including earthquakes, power outages, fires, floods, nuclear disasters, health epidemics (including the COVID-19 pandemic), war, and acts of terrorism or other criminal activities, which may render it difficult or impossible for us to operate our business for some period of time. For example, the COVID-19 pandemic, including its variants, disrupted the normal operations of our business, and any other similar pandemic or epidemic may result in the same among other impacts. As another example, our headquarters are located in the greater New York City area,City, a region with a history of terrorist attacks and hurricanes. Acts of terrorism, including malicious internet-based activity, could cause disruptions to the internet or the economy as a whole. Even with our disaster recovery arrangements, access to our platform could be interrupted. If our systems were to fail or be negatively impacted as a result of a natural disaster or other event, our ability to deliver our platform and solution to our Clients and members would be impaired or we could lose critical data. Although we maintain an insurance policy covering damage to property we rent, such insurance may not be sufficient to compensate for losses that may occur. If we are unable to develop adequate plans to ensure that our business functions continue to operate during and after a disaster, and successfully execute on those plans in the event of a disaster or emergency, any such losses or damages could have a material adverse effect on our business, financial condition and results of operations and harm our reputation. In addition, our Clients’ facilities may be harmed or rendered inoperable by such natural or man-made disasters, which may cause disruptions, difficulties, or material adverse effects on our business.

Our services involve the storage and transmission of Clients’ and our members’ proprietary information, sensitive or confidential data, including valuable intellectual property and personal information of employees, Clients, members and others, as well as the PHI of our members. Because of the sensitivity of the information we store and transmit, the security features of our and our third-party vendors’ computer, network, and communications systems infrastructure are critical to the success of our business. A breach or failure of our or our third-party vendors’ security measures could result from a variety of circumstances and events, including third-party action, employee negligence or error, malfeasance, computer viruses, cyber-attacks by computer hackers, failures during the process of upgrading or replacing software and databases, power outages, hardware failures, telecommunication failures, user errors, or catastrophic events. Information security risks have generally increased in recent years because of the proliferation of new technologies and the increased sophistication and activities of perpetrators of cyber-attacks. As cyber threats continue to evolve, we may be required to expend additional resources to further enhance our information security measures and/or to investigate and remediate any information security vulnerabilities. While we have security measures in place, we have experienced cybersecurity incidents in the past. Likewise, our third-party vendors have experienced cybersecurity incidents in the past that have impacted us. To date, management has not determined that any cybersecurity incidents the Company has experienced, including incidents our third-party vendors have experienced, have resulted in, or are reasonably likely to result in, a material impact to our business. We learn from these incidents and adjust controls and incident response procedures as needed. If our or our third-party vendors’ security measures fail or are breached, it could result in unauthorized persons accessing sensitive Client or member data (including PHI), a loss of or damage to our data, an inability to access data sources, or process data or provide our services to our Clients or members. Such failures or breaches of our or our third-party vendors’ security measures, or our or our vendors’ inability to effectively resolve such failures or breaches in a timely manner, could severely damage our reputation, adversely affect Client, member, or investor confidence in us, and reduce the demand for our services from existing and potential Clients or members. In addition, we could face litigation, damages for contract breach, monetary penalties, or regulatory actions for violation of applicable laws or regulations, and incur significant costs for remedial measures to prevent future occurrences and mitigate past violations. Applicable data protection laws, privacy policies, or data protection obligations may require us to notify affected individuals, regulators, customers, credit reporting agencies, and others in the event of a security breach. Members about whom we obtain health information, as well as the providers who share this information with us, may have statutory or contractual rights that limit our ability to use and disclose the information. We may be required to expend significant capital and other resources to ensure ongoing compliance with applicable data protection laws, privacy policies, and data protection obligations. Claims that we have violated individuals’ privacy rights or breached our data protection obligations, even if we are not found liable, could be expensive and time-consuming to defend and could result in adverse publicity that could harm our business. Although we maintain insurance covering certain security and privacy damages and claim expenses, we may not carry insurance or maintain coverage sufficient to compensate for all liability and in any event, insurance coverage would not address the reputational damage that could result from a security incident.

In addition, our BetterHelp segment and the industry as a whole has come under increasing scrutiny from government regulators in recent years, including as a result of the industry’s growing profile due to the COVID-19 pandemic.years. Accordingly, we must monitor our compliance with laws in every jurisdiction in which we operate, on an ongoing basis, and we cannot provide assurance that our activities and arrangements, if challenged, will be found to be in compliance with the laws. Additionally, it is possible that the laws and rules governing the practice of medicine, including virtual healthcare, in one or more jurisdictions may change in a manner deleterious to our business. In the past 12 months, Oregon and California have passed laws codifying and strengthening their existing corporate practice of medicine prohibitions in ways which may require us to adjust contractual arrangements with BetterHelp, THMG Association and the Uplift Association. We are aware of a number of states, including Washington, Maine, Connecticut, and North Carolina which are considering similar bills in 2026. If a successful legal challenge or an adverse change in the relevant laws were to occur, and we were unable to adapt our business model accordingly, our operations in the affected jurisdictions would be disrupted, which could have a material adverse effect on our business, financial condition, and results of operations.

In our U.S. telehealth business, we are dependent on our relationships with affiliated professional entities, which we do not own, to provide medical services, and our business would be adversely affected if those relationships were disrupted or if our arrangements with the THMG Association's or the Uplift Association's providers or our Clients are found to violate state laws prohibiting the corporate practice of medicine or fee splitting.

The laws of all states prohibit us from exercising control over the medical judgments or decisions of physicians and the laws of many states, including states in which many of our Clients are located, prohibit us from engaging in certain financial arrangements, such as splitting professional fees with physicians. These laws and their interpretations vary from state to state and are enforced by state courts and regulatory authorities, each with broad discretion, and are subject to change and to evolving interpretations by state boards of medicine and state attorneys general, among others. We enter into agreements with our affiliated professional association,associations, THMG,THMG and Uplift PC, which entersenter into contracts with itstheir respective providers pursuant to which they render professional medical services. In addition, we enter into contracts with our Clients to arrange for the THMG Association to deliver professional services in exchange for fees. These contracts include management services agreements with our affiliated physician organizations pursuant to which the physician organizations reserve exclusive control and responsibility for all aspects of the practice of medicine and the delivery of medical services. Although we seek to comply with applicable state prohibitions on the corporate practice of medicine and fee splitting, changes in, or subsequent interpretations of, the corporate practice of medicine laws could circumscribe our business operations, and state officials who administer these laws or other third parties may successfully challenge our existing organization and contractual arrangements. If such a claim were successful, we could be subject to civil and criminal penalties, the repayment of reimbursements from third partythird-party payors, and could be required to restructure or terminate the applicable contractual arrangements. A determination that these arrangements violate state statutes, or our inability to successfully restructure our relationships with the THMG Association's or the Uplift Association's providers to comply with these statutes, could hinder our ability to provide services to Clients or members located in certain states, which would have a materially adverse effect on our business, financial condition, and results of operations. State corporate practice of medicine doctrines also often impose penalties on physicians themselves for aiding the corporate practice of medicine, which could discourage physicians from participating in our network of providers. Additionally, a number of states have recently introduced or are planning to introduce legislation which would significantly increase the level of scrutiny that similarly structured organizations would face and could introduce additional penalties on management services organizations similar to ours.

We do not own THMG,THMG or Uplift PC, which is aare 100% physician owned independent entity,entities, or the respective professional corporations with which iteach entity contracts. THMGTHMG, Uplift PC, and the other professional corporations are owned by physicians licensed in their respective states. While we expect that these relationships will continue, we cannot guarantee that they will. A material change in our relationship with THMG, Uplift PC, or among THMG or Uplift PC and the respective contracted professional corporations, whether resulting from a dispute among the entities, a change in government regulation, or the loss of these affiliations, could impair our ability to provide services to our members and could have a material adverse effect on our business, financial condition, and results of operations. In addition, the arrangements in which we have entered to comply with state corporate practice of medicine doctrines could subject us to additional scrutiny by federal and state regulatory bodies, including with respect to federal and state fraud and abuse laws. We believe that our operations comply with applicable state statutes and regulations regarding corporate practice of medicine, fee-splitting, and anti-kickback prohibitions. However, any scrutiny, investigation, or litigation with regard to our arrangement with the THMG Association the Uplift Association, or BetterHelpBetterHelp's providers could have a material adverse effect on our business, financial condition and results of operations, particularly if we are unable to restructure our operations and arrangements to comply with applicable laws or we are required to restructure at a significant cost, or if we were subject to penalties or other adverse action. In the past 12 months, Oregon and California have passed laws codifying and strengthening their existing corporate practice of medicine prohibitions in ways which may require us to adjust contractual arrangements with THMG or Uplift. We are aware of a number of states, including Washington, Maine, Connecticut, and North Carolina which are considering similar bills in 2026.

We have identified what we believe are the areas of government regulation that, if changed, would likely be most costly to us. These areas include: rules governing the provision of telehealth, including, for example, rules that would require in person visits or consultations prior to the provision of telehealth; practice of medicine by physicians; licensure standards for doctors, physician assistants, advanced practice registered nurses, nurses, and mental health professionals; laws limiting the corporate practice of medicine; cybersecurity and privacy laws; laws and rules relating to the distinction between independent contractors and employees; and tax and other laws encouraging employer-sponsored health insurance and group benefits. There could be laws and regulations applicable to our business that we have not identified or that, if changed, may be costly to us, and we cannot predict all the ways in which implementation of such laws and regulations may affect us.

In the jurisdictions in which we operate, we believe we are in compliance with all applicable laws, but, due to the uncertain regulatory environment, certain jurisdictions may allege or determine that we are in violation of their laws. Moreover, the uncertain regulatory environment surrounding AI may result in states with competing regulations, and therefore we cannot ensure that we will be compliant with changing regulations or that new regulations will not negatively affect our business. In the event that we must remedy such violations, we may be required to modify our services and products in a manner that undermines our solutions’ attractiveness to our Clients, members or providers, we may become subject to fines or other penalties or, if we determine that the requirements to operate in compliance in such jurisdictions are overly burdensome, we may elect to terminate our operations in such places. In each case, our revenue may decline, and our business, financial condition, and results of operations could be materially adversely affected.

The U.S. healthcare industry is heavily regulated and closely scrutinized by federal, state, and local governments. Comprehensive statutes and regulations govern the manner in which we provide and bill for services and collect reimbursement from governmental programs and private payors, our contractual relationships with the THMG Association's and the Uplift Association's providers, vendors, and Clients, our marketing activities and other aspects of our operations. Of particular importance are:

Numerous other federal and state laws protect the confidentiality, privacy, availability, integrity, and security of PII, including PHI and other personal data. These laws in many cases are more restrictive than, and may not be preempted by, the HIPAA rules and may be subject to varying interpretations by courts and government agencies, creating complex compliance issues for us and our Clients and potentially exposing us to additional expense, adverse publicity, and liability. In addition to fines and penalties imposed upon violators, some of these state laws also afford private rights of action to individuals who believe their personal information has been misused. There are many other state-based data privacy and security laws and regulations that may impact our business. All of these evolving compliance and operational requirements impose significant costs that are likely to increase over time, may require us to modify our data processing practices and policies, divert resources from other initiatives and projects, and could restrict the way services involving data are offered, all of which may adversely affect our business, financial condition, and results of operations. For example, U.S. states have begun to introduce more comprehensive data protection laws.laws, Thewhich CCPA went into effect in January 2020 and established a new privacy framework for covered businesses such as ours that expands the scope of personal information and provides new privacy rights for California residents. These changes requiredrequire us to modify our data processing practices and policies and incur compliance-related costs and expenses.expenses, Theand CCPA also providesprovide for civil penalties for violations, as well as a private right of action for data breaches, which may increase the likelihood and cost of data breach litigation. Additionally, the CPRA went into effect on January 1, 2023 and significantly modifies the CCPA by, among other things, creating a dedicated privacy regulatory agency, requiring businesses to implement data minimization and data integrity principles, and imposing additional requirements for contracts addressing the processing of personal information. Numerous states have enacted, or are currently reviewing, legislation that is similar to the CCPA and/or CPRA. For example, the Texas Data Privacy and Security Act, the Oregon Consumer Privacy Act and the Montana Consumer Data Privacy Act became effective in 2024. There are also bills that have been approved or are going through the legislative process in many more states. In 2022, a draft of the American Data Privacy and Protection Act was released and would be a comprehensive federal data privacy law that would seek to ease the burden of a patchwork of overlapping but different state laws. These changes may result in further uncertainty with respect to privacy, data protection, and information security issues and will require us to incur additional costs and expenses in an effort to comply.

We outsource important aspects of the storage and transmission of Client and member information, and thus rely on third parties to manage functions that have material cybersecurity risks. We attempt to address these risks by requiring outsourcing subcontractors who handle Client and member information to sign business associate agreements and/or data processing agreements contractually requiring those subcontractors to adequately safeguard personal health data to the same extent that applies to us and in some cases by requiring such outsourcing subcontractors to undergo third-party security examinations. In addition, we periodically hire third-party security experts to assess and test our security posture. However, we cannot assure you that these contractual measures and other safeguards will adequately protect us from the risks associated with the storage and transmission of Client and members’ proprietary and protected health information.

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.” TheIn Company’sJune 2025, the Company relocated its principal executive office is located infrom 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.care.

WeMore than 20 years ago, we were founded on a simple, yet revolutionary idea: that everyone should have access to the best healthcare, anywhere in the world on their terms. Today, we have a vision of making virtual care the first step on any healthcare journey, and we are delivering on this mission by providing virtual care that includes primary care, mental health, chronic condition management, and more.

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 fees offer a greater margin than those who have visit fee only access and, over time, the mix of those who have paid access fees 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 elsewhere in this Annual Report on Form 10-K. U.S. Integrated Care members increased by 4.28.0 million, or 5%,9%, to 93.8101.8 million at December 31, 2024,2025, compared to the same period in 2023.2024.

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 increasedincrease revenue. Chronic care program enrollment increaseddecreased by 4%1% to 1.19 million at December 31, 2025, compared to 1.20 million at December 31, 2024, compared to 1.16 million at December 31, 2023.2024.

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,adoption and future revenue growth potential. Average monthly revenue per U.S. Integrated Care member decreased to $1.37$1.29 in the year ended December 31, 2024,2025, from $1.41$1.37 in the same period in 2023,2024, primarily due to the impact of new members onboarded over the course of the year. The change in average monthly revenue versus the indicated prior period is reflective of the growth and timing of onboarding new members and the mix of their fees.

BetterHelp Paying Users. BetterHelp paying users represent the average number of global monthly paying users of our BetterHelp therapy services during the applicable period.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 11%5% to 0.39 million for the year ended December 31, 2025, compared to 0.41 million for the year ended December 31, 2024, compared to 0.46 million for the year ended December 31, 2023.2024.

We follow the revenue accounting requirements of Accounting Standards Codification (“ASC”) Topic 606, “Revenues from Contracts with Customers,” which establishes a principle for recognizing revenue upon the transfer of promised goods or services to customers, in an amount that reflects the expected consideration received in exchange for those goods or services. The core principle of ASC Topic 606 is to recognize revenue to depict the transfer of promised goods or services to Clients as well as individual members, in an amount that reflects the consideration the entity expects to be entitled in exchange for those goods or services. This principle is achieved through applying the following five-step approach:

As it relates to the Integrated Care segment, we primarily generate virtual healthcarecare service revenue from contracts with Clients who purchase access to the THMG AssociationAssociation's professional provider network or medical experts for their employees, dependents and other beneficiaries. Our Client contracts include a PMPMPMPM, PEPM, or PPPM access fee as well as certain contracts that also include additional revenue on a per-virtual healthcare visit basis for general medical, or other specialty visits or expert medical service on a per case basis. We also have certain contracts that generate revenue based solely on a per healthcareper-telehealth visit basis for general medical and other specialty visits. Depending on the product, we may generate revenue from Clients through a combination of access fees and visit fees, while certain Clients may have access-fee only or visit fee only arrangements.

We recordgenerate access fees from Clients accessing the THMG Association professional provider network ornetwork, hosted virtual healthcarecare platformplatform, orand chronic care management platforms,platforms. We also generate visit fee revenue for general medical, expert medicalsecond serviceopinions, virtual therapy, and other specialty visitsvisits. asAdditionally, wellwe asgenerate other revenue primarily associated with virtual healthcarecare device equipment sales included with our hosted virtual healthcarecare platform. Visit and other revenues are reported as “Other” revenue in our consolidated financial statements.

Revenue is also generated from contracts with Clients in hospital and health systems for the sale and rental of equipment consisting of virtual healthcarecare devices which allow physicians to access our hosted virtual healthcarecare platform. These contracts also include multiple performance obligations, and we determine the standalone selling prices based on overallhistorical selling price of these performance obligations in similar transactions as well as current pricing objectives.practices. In some arrangements, our devices are rented to certain qualified Clients that qualify as either sales-type lease or operating lease arrangements and are subject to lease accounting guidance.

Revenue is also generated from contracts with Clients for our chronic care management solutions. Substantially all of this revenue is derived from monthly access fees that are recognized as services are rendered and earned under subscription agreements with Clients that are based on a PPPM model, using the number of active enrolled members each month for the minimum enrollment period. These solutions integrate devices, supplies, access to our web-based platform, mobile application, and clinical and data services to provide an overall health management solution. The promises to transfer these goods and services are not separately identifiable and are considered a single continuous service comprised of a series of distinct services that are substantially the same and have the same pattern of transfer (i.e., distinct days of service). These services are consumed as they are received, and we recognize revenue each month using the variable consideration allocation exception sincebecause the nature of the obligations and the variability of the payment being based on the number of active members are aligned.

Our Client agreements generally have a term of one to three years for the Integrated Care segment.segment, Thethe majority of Clientswhich have a term of one year and renew their contracts following their first year of services.year. Revenues are recognized when we satisfy our performance obligation to stand ready to provide virtual healthcarecare services which occurs when our Clients and members have access to and obtain control of the virtual healthcarecare service or platform.

For contracts where revenue is generated on a per healthcareper-telehealth visit basis, revenues are recognized when the visits are completed as we have delivered on our stand ready obligation to provide access. For other revenue, which primarily includes virtual healthcarecare devices, our performance obligation is satisfied when the equipment is provided to the Client and revenue is recognized at a point in time upon shipment.

We generally bill for virtual healthcarecare services on a monthly basis, in advance or in arrears depending on the service, with payment terms generally being 30 days. There are not significant differences between the timing of revenue recognition and billing. Consequently, we have determined that Client contracts do not include a financing component. Revenue is recognized in an amount that reflects the consideration that is expected in exchange for the service and for certain contracts include a variable transaction price as the number of members may vary from period to period. We estimate this amount based on historical experience.

Additionally, certain of our contracts include Client performance guarantees and pricing adjustments that are based upon minimum member utilization and guarantees by us for specific service level performance, member satisfaction scores, cost savings or other value achievements or guarantees, and health outcome guarantees. Performance guarantees are estimated at each reporting period based on our historical performance or other available information of the underlying criteria or the customer’s specific performance as of that reporting date. Any estimated adjustments to the contract price for achieving or not achieving the performance guarantee are recognized as an adjustment to revenue in the period. For the years ended December 31, 2024 and 2023, revenue recognized from performancePerformance obligations related to prior periods for changes in estimated transaction price or Client performance guarantees wasresulted in an increase of $8.3 million in revenue for the year ended December 31, 2025 and a decrease of $5.9 million andof $14.7revenue million,for respectively.the year ended December 31, 2024.

We have elected the optionalpractical exemptionexpedient to not disclose the remaining performance obligations of our contracts since the majority of our contracts have a duration of one year or less and the variable consideration expected to be received over the duration of the contract is allocated entirely to the wholly unsatisfied performance obligations.

As it relates to the BetterHelp segment, users can purchase virtual therapy services for an access fee, generally on a monthly or weekly basis. In certain states, users can utilize their insurance coverage to pay for virtual therapy services on a per visit basis. For other wellness services, users can purchase access to their consumer application for a subscription fee, generally for a period of one year. BetterHelp also provides virtual therapy services to employers as part of employee assistance programs, with revenues recorded based on completion of visit.

At October 1, 2024,2025, we performed our annual test of goodwill impairment using a quantitativediscounted analysis.cash flow method under the income approach. We determined that the BetterHelp reporting unit’s fair value exceeded its carrying value by a significant margin,value, while the Integrated Care reporting unit’s fair value was less thanapproximated its carrying value. Since the BetterHelp reporting unit's fair value exceeded its carrying value and the Integrated Care reporting unit carriescarried no goodwill at October 1, 2024,2025, no impairment was recorded. If the carrying value of the Integrated Care reporting unit exceeds its fair value as of the date of any future business combinations, the future business combinations that would be part of the Integrated Care reporting unit could result in further goodwill impairment charges.

Other intangible assets include customerclient and other relationships, non-compete agreements, acquired technology, and trademarks resulting from business acquisitions, as well as capitalized software development costs. As of December 31, 2024,2025, the aggregate balance of these assets was $1,431.4$1,297.1 million. We amortize these definite-lived intangible assets over their estimated useful lives as disclosed in Note 8.9. “Intangible Assets, Net and Certain Cloud Computing Costs” to the consolidated financial statements. We also review the estimated useful lives on a quarterly basis to determine if the period of economic benefit has changed. Potential changes in useful lives, whether due to strategic decisions involving our brands, competitive forces, or other factors could result in additional amortization expense taking effect prospectively in the period of the change and could have a material impact on our consolidated financial statements.

During the secondthree halfmonths ofended 2023,December 31, 2025, we initiated a strategy to transition the majorityremainder of our chronic condition management Clients and members to the Teladoc Health brand onby aDecember phased31, basis, with a smaller subset continuing to be served under the Livongo trade name beyond 2024.2026. In connection with the brand strategy,westrategy, acceleratedwe have decreased the amortizationremaining useful life of intangible assets that are associated with the Livongorelated trademark,trademarks increasingasset, which increased amortization of intangible assets expense beginning in the second half of 2023 and continuing throughfor the year ended December 31, 2024,2025 withby corresponding$7.7 reductionsmillion thereafter.and will increase amortization expense for the year ending December 31, 2026 by $30.7 million.

Cost of revenue (exclusive of depreciation and amortization, which are shown separately), or "“Cost of revenue,"” primarily consists of fees paid to the physicians and other health professionals in the THMG Association and the Uplift Association provider networknetworks; product cost; costs incurred in connection with the THMG Association and the Uplift Association provider network operations and data center activities, which include employee-related expenses (including salaries and benefits, incentive compensation, and stock-based compensation); costs related to Client support; and provider network, medical records, magnetic resonance imaging, medical lab tests, translation, postage, medical malpractice insurance, and deferred device costs. Cost of revenue includes costs of technology enabling multiple modes of real-time communication, including via web browser, mobile application, voice / telephony, and text. These expenses increase or decrease as the level of revenue changes. Cost of revenue is driven primarily by the number of general medical visits, mental health visits, expert medical services, and other specialty visits completed in each period and are closely correlated or directly related to delivery of our solutions and monthly access fees. Many of the elements of the cost of revenue are relatively variable, and can be reduced in the near-term to offset any decline in our revenue. Our business and operational models are designed to be highly scalable and leverage variable costs to support revenue-generating activities. Cost of revenue does not include an allocation of depreciation and amortization.

Technology and development expenses include personnel and related expenses (including salaries and benefits, incentive compensation, and stock-based compensation) for software engineering, information technology infrastructure, security and compliance, product development, and support for our efforts to add new features and ensure the reliability or scalability of our existing solutions. Technology and development expenses also include outsourced software engineering services, the costs of operating our on-demand technology infrastructure (whereas costs directly associated with revenue are presented separately in cost of revenues), and certain licensed applications.applications, and stock-based compensation for its technology and development employees. Our technology and development expenses exclude certain allocations of occupancy expense, capitalized software development costscosts, and depreciation and amortization.

General and administrative expenses include personnel and related expenses (including salaries and benefits, incentive compensation, and stock-based compensation) of, and professional fees incurred by our finance, legal and compliance, operations, human resources, clinical, corporate strategy, business development, strategies, quality and executive departments. They also include bank charges, most of the facilitiesoccupancy costs including rent, utilities, and facilities maintenance, except for amounts allocated to cost of revenues, as well as therapists recruiting costs, related to BetterHelp, indirect taxes and certain licensed corporate applications. Our general and administrative expenses exclude any allocation of depreciation and amortization.

Adjusted EBITDA,EBITDA and Free Cash Flow

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 impairmentimpairments; and stock-based compensation.

______________________________________ n/m – not meaningful (1)Non-GAAP Financial Measures The following table reconciles net loss, the most directly comparable GAAP measure, to Adjusted EBITDA for the years ended December 31, 20242025 and 20232024 (in thousands):

Cost of Revenue (exclusive of depreciation and amortization, which are shown separately below). Cost of revenue was $771.6 million for the year ended December 31, 2025, compared to $751.3 million for the year ended December 31, 2024, comparedan to $760.0 million for the year ended December 31, 2023, a decreaseincrease of $8.8$20.3 million, or 1%.3%. The decreaseincrease was primarily driven by lowerhigher providerlabor andcosts, technology costs, and amortization of devices, partially offset by higherlower amortization of deviceprovider costs.

Advertising and Marketing Expenses. Advertising and marketing expenses were $653.4 million for the year ended December 31, 2025, compared to $705.8 million for the year ended December 31, 2024, compareda to $688.9 million for the year ended December 31, 2023, an increasedecrease of $16.9$52.4 million, or 2%.7%. This increasedecrease was substantially driven by higherlower media advertising costs, partially offset by lowerand employee compensation costs.

Sales Expenses. Sales expenses were $194.5 million for the year ended December 31, 2025, compared to $205.0 million for the year ended December 31, 2024, compared to $213.8 million for the year ended December 31, 2023, a decrease of $8.8$10.5 million, or 4%.5%. The decrease was primarily driven by lower employee compensation,compensation costs and lower professional fees, partially offset by higher professional fees and broker commissions.

General and Administrative Expenses. General and administrative expenses were $431.9 million for the year ended December 31, 2025, compared to $435.5 million for the year ended December 31, 2024, compared to $464.7 million for the year ended December 31, 2023, a decrease of $29.2$3.6 million, or 6%.1%. The decrease was primarily driven by lower employee compensation and therapist onboarding costs,compensation, partially offset by higher legalindirect feestaxes, andprofessional fees, software and infrastructure costs.costs, and dues and subscriptions.

Acquisition, Integration, and Transformation Costs. Acquisition, integration, and transformation costs were $9.0 million for the year ended December 31, 2025, compared to $1.7 million for the year ended December 31, 2024, comparedan increase of $7.3 million. The increase relates to $21.1the millioncosts forto integrate the yearoperations endedof Decemberthe 31,businesses 2023,acquired and to complete the upgrade of a decreasetechnology of $19.4 million, as we wrap up the upgrading of our CRM and ERP systems.platform.

Restructuring Costs. Restructuring costs were $20.4$18.8 million and $16.9$20.4 million for the years ended December 31, 20242025 and 2023,2024, respectively. The costs primarily related to severance, the reduction of office space, severance, right-of-use asset impairment chargescharges, and other restructuring related costs. See Note 12.13. ‘“Restructuring” to the financial statements for additional information.

Amortization of intangible assets was $350.8 million for the year ended December 31, 2025, compared to $363.4 million for the year ended December 31, 2024, compareda to $325.9 million for the year ended December 31, 2023, an increasedecrease of $37.4$12.6 million, or 11%.3%. The higher expensedecrease 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, partially offset by lower amortization of acquired intangibles due to certain trademarks becoming fully amortized.platforms.

Depreciation of Property and Equipment. Depreciation of property and equipment was $13.3 million for the year ended December 31, 2025, compared to $10.2 million for the year ended December 31, 2024, comparedan increase of $3.1 million, or 31%. The increase was driven primarily by accelerated depreciation associated with decisions made to $11.1exit millioncertain forleased spaced in the year ended December 31, 2023, a decrease of $1.0 million, or 9%.2025.

Interest Expense.Income. Interest expenseincome was $23.8$36.8 million for the year ended December 31, 2024,2025, compared to $22.3$57.1 million for the year ended December 31, 2023.2024. The decrease was driven by a lower average balance of cash and cash equivalents and lower interest rate yields.

Other Expense (Income), Net. Other expense (income), net was an income of $10.4 million for the year ended December 31, 2025, compared to an expense of $6.0 million for the year ended December 31, 2024,2024. comparedThe tobalance anin incomeboth ofperiods $4.4primarily million forreflects the year ended December 31, 2023, primarily reflecting losses on foreign currency exchange rate fluctuations for the year ended December 31, 2024, whereas the year ended December 31, 2023 reflected a gain on the partial saleimpact of a business, partially offset by losses on foreign currency exchange rate fluctuations.

For a discussion of potential risks and uncertainties related to our Company see the information in Part I, Item 1A1A. “Risk Factors” of our Annual Report on Form 10-K for the year ended December 31, 2025.2025, Thereas havewell been no material changes toas the risk factors previouslyset disclosedforth in our Annual Report on Form 10-K for the year ended December 31, 2025.below.

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 fees offer a greater margin than those who have visit fee only arrangements and, over time, the mix of those who have paid access fees as compared to those who have visit fee only arrangements 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 overall membership level 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 2025 Form 10-K. U.S. Integrated Care members decreased by 1.32.1 million, or 1%,2%, to 101.2100.3 million at MarchJune 31,30, 2026, compared to the same period in 2025.

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 increased to 1.1971.272 million, or 4%,14%, at MarchJune 31,30, 2026, compared to 1.1511.117 million at MarchJune 31,30, 2025.2025, driven by an increase in multi-condition product bundles.

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 21%22% 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 and further product adoption among our Client-base to drive future revenue growth potential. Average monthly revenue per U.S. Integrated Care member was $1.30$1.31 in the three months ended MarchJune 31,30, 2026, compared to $1.27 in the same period in 2025. Average monthly revenue per U.S. Integrated Care member was $1.31 in the six months ended June 30, 2026, compared to $1.27 in the same period in 2025. The change in average monthly revenue versus the prior period is reflective of the decrease in members and the mix of their fees.

BetterHelp Paying Users. BetterHelp Paying Users represent the average number of global monthly paying users of our BetterHelp therapy and psychiatry 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 usersusers, including through Insurance Covered Services, and retain existing users is a key indicator of the market adoption of BetterHelp, the stability and growth of this segment, and future revenue potential. Effectively reaching potential paying users through various advertising channels remains critical to our success.success, including the level of advertising and marketing spending deployed. BetterHelp Paying Users decreased by 9%11% to 0.3610.346 million for the three months ended MarchJune 31,30, 2026, compared to 0.3970.388 million for the three months ended MarchJune 31,30, 2025, and decreased by 10% to 0.353 million for the six months ended June 30, 2026, compared to 0.393 million for the six months ended June 30, 2025. See “Item 1A. Risk Factors— Our BetterHelp segment has experienced, and may continue to experience, declines in revenue from users who pay directly out-of-pocket, and growth in insurance-covered services may not offset those declines as quickly as we expect or at all.” included elsewhere in this Quarterly Report on Form 10-Q.

Seasonality. Our business has historically been subject to seasonality. In our Integrated Care segment, a concentration of our new Client contracts have an effective date of January 1 as a result of many Clients’ introduction of new services at the start of each calendar year. Therefore, while membership increases,service utilization and enrollment rates aremay dampenednot untildirectly servicealign delivery ramps up overwith the coursetiming of themembership year.changes. In addition, as a result of seasonal cold and flu trends, we historically have experienced our highest level of visit and other fee revenue during the first and fourth quarters of each year.

Due to the higher cost of customer acquisition during the end-of-year holiday season, our BetterHelp segment has historically reduced marketing activity during the fourth quarter. As a result of this dynamic, we have typically experienced fewer new memberuser additions and stronggenerally a stronger operating income performance in the fourth quarter. Conversely, as marketing activity typically resumes at the start of the year, we typically experience weakweaker operating income performance during the first quarter as new customeruser acquisition and associated revenue growthtend lagsto lag marketing spend.

As of MarchJune 31,30, 2026, goodwill was $283.2 million, which all related to the BetterHelp segment.reporting unit. During the three months ended MarchJune 31,30, 2026, ourwe market capitalization remained belowrevised the Company’sexpected carryingfinancial orperformance bookof value.the WhileBetterHelp reporting unit. We determined that this factorwas isa consideredtriggering inevent ourand accordingly performed a quantitative goodwill impairment test. The assessment of potential impairment indicators, we did not identify any additional events or changes in circumstances that would indicate it is more likely than notindicated that the fair value of the BetterHelp reporting unit is belowexceeded its carrying value.value As a result,and no interim impairment test was required.identified. We will continue to monitor and evaluate events and circumstances, including a sustained decrease in our share price,price and the future performance of the BetterHelp segment, and should any change,change occur, it could require further testing of the goodwill, which may result in an impairment of the BetterHelp reporting unit's goodwill. Additionally, if the carrying value of the Integrated Care reporting unit exceeds its fair value as of the date of any future business combinations, future business combinations that would be part of the Integrated Care reporting unit could result in goodwill impairment charges.

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 costcosts; goodwill impairments; and stock-based compensation.

We compensate for these limitations by using these non-GAAP measures along with other comparative tools, together with GAAP measurements, to assist in the evaluation of operating performance. Such GAAP measurements include net loss, net loss per share, net cash provided byfrom operating activities, and other performance measures.

The following table sets forth our condensed consolidated statements of operations data for the three months ended MarchJune 31,30, 2026 and 2025 and the dollar and percentage change between the respective periods (dollars in thousands, except per share data):

The following table reconciles net loss, the most directly comparable GAAP financial measure, to Adjusted EBITDA for the three and six months ended MarchJune 31,30, 2026 and 2025 (in thousands):

The following table presents revenues disaggregated by revenue source and geography for the three months ended MarchJune 31,30, 2026 and 2025:

Total revenue was $613.8$606.9 million for the three months ended MarchJune 31,30, 2026, compared to $629.4$631.9 million for the three months ended MarchJune 31,30, 2025, a decrease of $15.5$25.0 million, or 2%.4%. This decrease in revenue was driven by lower revenue in our BetterHelp segment, reflecting actions to further prioritize insurance-covered services and decline in users paying directly out of pocket, partially offset by higher revenue in our Integrated Care segment. For further discussion regarding the decrease in revenue in our BetterHelp segment, see below under “Segment Information.” The acquisitions of Catapult Health, Uplift,Uplift and Telecare increased total revenue for the three months ended MarchJune 31,30, 2026 by approximately 31 percentage points.point. Other revenue predominately includes visit fees and, to a lesser extent, revenue from the sales of our telehealth solutions for hospitals and health systems.

TechnologyTotal andrevenue Developmentwas Expenses. Technology and development expenses were $67.9$1,220.8 million for the threesix months ended MarchJune 31,30, 2026, compared to $70.0$1,261.3 million for the threesix months ended MarchJune 31,30, 2025, a decrease of $2.1$40.5 million, or 3%. TheThis decrease primarilyin reflectsrevenue was driven by lower employeerevenue compensationin costsour andBetterHelp travel costs,segment, partially offset by higher professionalrevenue feesin our Integrated Care segment. The acquisitions of Catapult Health, Uplift, and duesTelecare andincreased subscriptions.total revenue for the six months ended June 30, 2026 by approximately 2 percentage points.

General and AdministrativeSales Expenses. General and administrativeSales expenses decreasedwere $10.7 million, or 9%, to $102.1$49.4 million for the three months ended MarchJune 31,30, 2026, compared to $112.8$50.0 million for the three months ended MarchJune 31,30, 2025.2025, Thea decrease wasof primarily$0.6 drivenmillion, byor 1%. This decrease reflects lower employee compensation costs, professional fees, occupancy costs,costs and travel costs, partially offset by higher indirectcommissions. taxes.On a year-to-date basis, sales expenses increased by $2.0 million, or 2%, to $100.7 million. This increase reflects higher commissions costs, offset by lower employee compensation costs and lower travel costs.

Goodwill Impairments. We did not record a non-cash goodwill impairment charge for the three and six months ended MarchJune 31,30, 2026. In the three months ended March 31, 2025, 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 exceeded its fair value. As a result, we recognized a goodwill impairment of $59.1 million associated with the acquisition of Catapult Health. If the carrying value of the Integrated Care reporting unit exceeds its fair value as of the date of any future business combinations, the future business combinations that would be part of the Integrated Care reporting unit could result in further goodwill impairment charges.

Acquisition, Integration, and Transformation Costs. Acquisition, integration, and transformation costs primarily consisted of costs to integrate and upgrade our ERP ecosystemsystem and costs to integrate the operations of acquired businesses and were $1.1$1.7 million and $2.2$2.7 million for the three months ended MarchJune 31,30, 2026 and 2025, respectively, and were $2.8 million and $4.8 million for the six months ended June 30, 2026 and 2025, respectively.

Restructuring Costs. Restructuring costs for the three months ended MarchJune 31,30, 2026 were $12.0$0.9 million, of which $11.0$0.6 million was for employee transition, severance, employee benefits, and related costs and $1.0$0.3 million was related to costs associated with office space reductions. Restructuring costs for the six months ended June 30, 2026 were $12.9 million, of which $11.6 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 $0.2 million of right-of-use asset impairment charges.

Restructuring costs for the three months ended MarchJune 31,30, 2025 were $4.3$5.7 million, of which $3.6$5.4 million was for employee transition, severance, employee benefits, and related costs and $0.7$0.3 million was related to costs associated with office space reductions, including $0.2$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.

DepreciationAmortization of Propertyintangible and Equipment. Depreciation of property and equipmentassets was $2.5flat at $88.4 million for the three months ended MarchJune 31,30, 2026, compared to $3.6$88.7 million for the three months ended MarchJune 31,30, 2025. Amortization of intangible assets was $178.3 million for the six months ended June 30, 2026, compared to $173.0 million for the six months ended June 30, 2025, aan decreaseincrease of $1.1$5.3 million, or 31%.3%.

Interest Income. Interest income consisted of interest earned on cash and cash equivalents. Interest income was $6.5 million for the three months ended MarchJune 31,30, 2026, compared to $12.7$10.1 million for the three months ended MarchJune 31,30, 2025. Interest income was $13.0 million for the six months ended June 30, 2026, compared to $22.7 million for the six months ended June 30, 2025. The decrease for theboth three months ended March 31, 2026periods was driven by lower interest rate yields and holding a lower average balance of cash and cash equivalents.

Interest Expense. Interest expense consisted of interest costs and the amortization of debt discounts primarily associated with the convertible senior notes. Interest expense was $5.4$5.1 million for the three months ended MarchJune 31,30, 2026, compared to $5.8$4.5 million for the three months ended MarchJune 31,30, 2025. Interest expense was $10.5 million for the six months ended June 30, 2026, compared to $10.2 million for the six months ended June 30, 2025. The decreaseincrease for both periods was primarily driven by interest associated with the Revolving Credit Facility, partially offset by the impact of the maturation of previouslycertain outstandingof the convertible senior notes in the prior year.

Other Expense (Income), net. Other expense (income), net was an expense of $0.2$2.2 million for the three months ended MarchJune 31,30, 2026, compared to an income of $2.4$8.4 million for the three months ended MarchJune 31,30, 2025. Other expense (income), net was an expense of $2.4 million for the six months ended June 30, 2026, compared to an income of $10.8 million for the six months ended June 30, 2025. The change primarily reflects the impact of foreign currency exchange rate fluctuations.

Provision for Income Taxes. We recorded an income tax expense of $3.0$1.0 million for the three months ended MarchJune 31,30, 2026 compared to an income tax benefit of $18.3$7.8 million for the three months ended MarchJune 31,30, 2025.2025, Theand an income tax expense of $4.0 million for the threesix months ended MarchJune 31,30, 2026 resultedcompared to an income tax benefit of $26.0 million for the six months ended June 30, 2025. Tax expense recorded for six months ended June 30, 2026 was primarily fromdue anto a $19.3 million increase in the valuation allowance.allowance and a discrete tax expense related to shortfall from stock-based compensation, offset by an ordinary tax benefit of $20.7 million. The tax benefit infor six months ended June 30, 2025 resultedwas primarily fromdue to a discrete benefit of $20.1 million related to the completion of a research and development tax credit study.study and $11.1 million of acquisition related tax benefits, offset by ordinary tax expense of $5.0 million.

The following tables set forth the results of operations by segment for the three and six months ended MarchJune 31,30, 2026 and 2025 (dollars in thousands):

Integrated Care total revenues increased by $6.0$2.8 million, or 2%,1%, to $395.4$394.3 million for the three months ended MarchJune 31,30, 2026, and increased by $8.8 million, or 1%, to $789.8 million for the six months ended June 30, 2026. The acquisition of Telecare increased Integrated Care total revenue for the three months ended June 30, 2026 by approximately 1 percentage point and the acquisitions of Catapult Health and Telecare increased Integrated Care total revenue for the threesix months ended MarchJune 31,30, 2026 by approximately 21 percentage points.point.

Integrated Care cost of revenue, exclusive of depreciation, amortization, and stock-based compensation, increased by $4.9$3.5 million, or 4%,3%, to $135.9$129.9 million for the three months ended MarchJune 31,30, 2026, and increased by $8.4 million, or 3%, to $265.8 million for the six months ended June 30, 2026. TheFor both periods, the increase was primarily driven by higher labor and provider costs.

BetterHelpIntegrated Care advertising and marketing, exclusive of stock-based compensation, decreased by $16.2$0.7 million, or 12%,2%, to $116.8$31.3 million for the three months ended MarchJune 31,30, 2026,2026 and decreased by $0.5 million, or 1%, to $65.2 million for the six months ended June 30, 2026. For both periods, the decrease primarily reflectingreflects lower spendingemployee oncompensation costs, partially offset by higher digital and media advertising.advertising costs.

BetterHelpIntegrated Care other segment expenses increaseddecreased by $4.5$7.8 million, or 13%,4%, to $38.5$167.9 million for the three months ended MarchJune 31,30, 2026, and decreased by $12.8 million, or 4%, to $337.3 million for the six months ended June 30, 2026. The increasedecrease for both periods was primarily driven by higherlower employee compensation costscosts, professional fees, and professionaloccupancy fees.and office expense, partially offset by higher commissions and indirect taxes.

The following table presents a summary of our cash flow activity for the threesix months ended MarchJune 31,30, 2026 and 2025 (in thousands):