Amwell saw its net losses balloon in the second quarter driven largely by the company’s dwindling market capitalization, the telehealth provider reported Wednesday.
The Boston-based company, also known as American Well Company, recorded a $93 million net loss, or 33 cents per share, a 34.8% increase from the year-ago period. Revenue declined 3.3% to $62.4 million and subscription revenue fell 5.1% to $28 million in the second quarter. Amwell downgraded its yearly revenue guidance from $275 million-$285 million to $257 million-$263 million.
The bulk of the additional losses stemmed from a $27.3 million non-cash goodwill impairment charge related to shrinking share prices, Amwell disclosed in a Securities and Exchange Commission filing. The company endured a separate non-cash goodwill impairment charge worth more than $330 million in the first quarter.
Amwell reported its earnings after its shares closed at $2.30 on the New York Stock Exchange Wednesday. At its peak in October 2020, the stock traded at more than $35 per share.
The company’s market capitalization has plummeted 47.2% from $1.18 billion on June 20, 2022, to $623.5 million as of Wednesday.
Amwell Chair and co-CEO Ido Schoenberg expressed optimism about potential of the company’s Converge platform during a call with investors Wednesday. The telehealth platform, which encompasses all of its products, represented 43% of visits in the second quarter compared with 28% at the end of last year, when the company began tracking the metric. Most visits are still on its legacy platforms.
Efforts to transition customers from the old system to Converge accounted for the revenue slip and subscription churn, Amwell Chief Financial Officer Robert Shepardson said. Amwell is counting on these conversions to boost revenue and achieve profitability and is modifying its sales tactics for health systems and health insurance companies, he said.