LifeMD (LFMD) Q3 2024 earnings summary

Executive summary

• Q3 2024 revenue increased 38% year-over-year to $53.4 million, driven by a 65% rise in telehealth revenue and a record gross margin of 91%.

• Telehealth active subscribers grew 30% to nearly 269,000, with growth in weight management, men's health, and insomnia; WorkSimpli subscribers declined 6% but returned to sequential growth.

• Launched a 22,500 sq ft national pharmacy, in-home labs, non-GLP-1 weight management, and men's hormonal therapy, with pharmacy expected to be accretive in 2025.

• Progress in payer contracting, aiming for coverage in at least 25 states and Medicare launch in H1 2025; commercial insurance programs launched in 10 states.

• Strategic priorities include expanding weight management, cardiovascular, and hormone therapy offerings, and scaling B2B solutions.

Financial highlights

• Q3 revenue was $53.4 million (+38% YoY); telehealth revenue $40.3 million (+65% YoY); WorkSimpli revenue $13.1 million (-8% YoY).

• Gross margin reached 91% (up from 88%); telehealth gross margin 89%; consolidated gross margin 85%+ YTD 2024.

• Adjusted EBITDA was $3.7 million (+33% YoY); telehealth adjusted EBITDA $2.5 million (up 200% sequentially); consolidated adjusted EBITDA guidance for 2024 is $13–$14 million.

• GAAP net loss attributable to common stockholders was $5.9 million ($0.14/share), improved from $6.9 million ($0.20/share) a year ago.

• Cash and equivalents stood at $37.6 million as of September 30, 2024; net cash provided by operating activities was $6.2 million for Q3 and $15.9 million for the nine months.

Outlook and guidance

• 2024 revenue guidance reaffirmed at $205 million (+35% YoY); telehealth revenue guidance raised to $151–$152 million; WorkSimpli revenue guidance $54 million.

• Adjusted EBITDA guidance narrowed to $13–$14 million; telehealth adjusted EBITDA raised to $6–$7 million.

• Q4 2024 revenue expected between $57–$58 million; Q4 adjusted EBITDA guidance: $6.5–$7.0 million.

• Pharmacy expected to be accretive in 2025, with anticipated $5 million in annualized savings at current volumes.

• Management expects continued double-digit new patient growth, 30%+ YoY revenue growth, and ~25% adjusted EBITDA margins.