The following is a summary of the American Well Corporation (AMWL) Q1 2024 Earnings Call Transcript:

Financial Performance:

• American Well Corporation reported Q1 2024 revenue of $59.5 million, a decrease of 7% year-on-year, largely due to declines in subscription and visit revenue.

• Subscription revenue for Q1 was $24.9 million, down 9% from Q4, but it's expected to increase throughout the year, with gains projected by Q4.

• Services and Carepoints revenue declined to $3.6 million from $7.7 million last quarter, while AMG visit revenue was $31 million, 4% lower than the previous year.

• Gross profit margin for Q4 was 31%, down around 300 basis points from the previous quarter mainly due to one-time costs and lower subscription software and services revenue.

• The company expects revenues of $259 million to $269 million for the year 2024, with revenue in 2025 projected to grow by around 30%, mainly driven by go-lives of contracted software backlog.

• It is predicted that the company will achieve adjusted EBITDA breakeven by 2026.

Business Progress:

• American Well made progress with its Converge platform, migrating approximately 70% of visit volume in Q1, up from 54% in Q4.

• With the completion of the Converge platform, R&D investments are expected to reduce, and the company aims to focus on higher-margin software subscriptions.

• The company executed a large client expansion with an existing East Coast Blue payer client, exhibiting their competitive edge in the crowded regional market for health insurance.

• Successful client renewals were noted from Highmark, Intermountain, El Camino Health, Penn State, and Cleveland Clinic.

• Also, the company completed the first milestone in the Defense Health Agency (DHA) project by going live with behavioral health, in line for an enterprise-wide deployment in Q4 of this year.

• American Well is embarking on a period of transformation to improve efficiency and effectiveness within the company, highlighted by changes in their go-to-market strategy and sales team.

More details: American Well IR

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