TALKSPACE EQUITY WARRANT(TALKW) - 2025 Q2 - Quarterly Results

Financial Performance Overview Talkspace reported strong Q2 2025 top-line growth and improved profitability, fueled by Payor revenue and strategic investments Second Quarter 2025 Financial Highlights Talkspace reported strong Q2 2025 top-line growth, with total revenue up 18% to $54.3 million, driven by Payor revenue gains Q2 2025 Key Financial Metrics (vs. Q2 2024) | Metric | Q2 2025 | % YoY Change | | :--- | :--- | :--- | | Total Revenue | $54.3M | 18% | | Payor Revenue | $40.5M | 35% | | Consumer Revenue | $4.4M | (32)% | | Net Loss | $(0.5)M | (14)% | | Adjusted EBITDA | $2.3M | 94% | Q2 2025 Key Operational Metrics (vs. Q2 2024) | Metric | Q2 2025 | % YoY Change | | :--- | :--- | :--- | | Completed Payor Sessions | 385.1 thousand | 29% | | Unique Active Payor Members | 111.2 thousand | 25% | - The company repurchased $1.4 million of its shares during the second quarter of 2025[1] Management Commentary Management highlighted positive operational momentum in Q2 2025, attributing it to technology and marketing investments - Management highlighted positive momentum from technology and marketing investments made in H1 2025[2] - The company achieved 10% sequential growth in unique active payor members and completed payor sessions, indicating a strong trajectory for the second half of the year[2] Financial Guidance The company reaffirmed its full-year 2025 financial guidance for total revenue and Adjusted EBITDA ranges Full Year 2025 Outlook Talkspace reaffirmed its full-year 2025 financial guidance, expecting total revenue between $220 million and $235 million and Adjusted EBITDA between $14 million and $20 million Full Year 2025 Guidance | Metric | Guidance Range | | :--- | :--- | | Revenue | $220M - $235M | | Adjusted EBITDA | $14M - $20M | Consolidated Financial Statements Consolidated financial statements detail Q2 2025 revenue growth, improved operating loss, solid liquidity, and cash flow Condensed Consolidated Statements of Operations Q2 2025 total revenue grew 17.9% to $54.3 million, driven by Payor revenue, with a narrowed loss from operations Revenue Breakdown (Q2 2025 vs Q2 2024) | Revenue Stream | Q2 2025 ($ thousands) | Q2 2024 ($ thousands) | % Change | | :--- | :--- | :--- | :--- | | Payor revenue | 40,501 | 29,945 | 35.3% | | DTE revenue | 9,403 | 9,628 | (2.3)% | | Consumer revenue | 4,406 | 6,485 | (32.1)% | | Total revenue | 54,310 | 46,058 | 17.9% | Profitability Metrics (Q2 2025 vs Q2 2024) | Metric ($ thousands) | Q2 2025 | Q2 2024 | % Change | | :--- | :--- | :--- | :--- | | Loss from operations | (1,790) | (3,486) | 48.7% | | Net loss | (541) | (474) | (14.1)% | Condensed Consolidated Balance Sheets As of June 30, 2025, Talkspace maintained a solid liquidity position with strong cash and marketable securities balances Key Balance Sheet Items (in thousands) | Account | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Cash and cash equivalents | $54,342 | $76,692 | | Total current assets | $120,667 | $130,182 | | Total assets | $132,786 | $138,677 | | Total liabilities | $19,845 | $21,282 | | Total stockholders' equity | $112,941 | $117,395 | Condensed Consolidated Statements of Cash Flows For H1 2025, net cash used in operating activities was $1.6 million, with significant usage in investing and financing Cash Flow Summary - Six Months Ended June 30 (in thousands) | Cash Flow Activity | 2025 | 2024 | | :--- | :--- | :--- | | Net cash (used in) provided by operating activities | $(1,590) | $1,418 | | Net cash used in investing activities | $(11,386) | $(2,150) | | Net cash used in financing activities | $(9,374) | $(8,263) | | Net decrease in cash | $(22,350) | $(8,995) | - The company repurchased $8.4 million of common stock for retirement during the first six months of 2025[19] Non-GAAP Financial Measures and Reconciliation This section defines Adjusted EBITDA as a key non-GAAP metric and reconciles it from net loss, detailing key adjustments Definition and Use of Non-GAAP Measures Adjusted EBITDA is a key non-GAAP metric used for assessing operating performance and business planning, excluding non-core items - Adjusted EBITDA is a key performance measure used by management for evaluating operating performance and for business planning purposes[20] - The company defines Adjusted EBITDA as net loss excluding depreciation and amortization, stock-based compensation, net financial income, income tax, and certain non-recurring expenses[24] Reconciliation of Net Loss to Adjusted EBITDA Q2 2025 GAAP net loss of $0.54 million was reconciled to Adjusted EBITDA of $2.28 million, adjusted for stock-based compensation and non-recurring expenses Reconciliation of Net Loss to Adjusted EBITDA (Q2 2025 vs Q2 2024, in thousands) | Line Item | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | Net loss | $ (541) | $ (474) | | Depreciation and amortization | 718 | 220 | | Stock-based compensation | 2,355 | 3,107 | | Financial income, net | (1,325) | (3,044) | | Income tax expense | 76 | 32 | | Non-recurring expenses | 999 | 1,338 | | Adjusted EBITDA | $ 2,282 | $ 1,179 | - Non-recurring expenses for Q2 2025 primarily consisted of severance costs, one-time legal fees, and other one-time expenses[26] Other Information This section covers earnings call details, Talkspace's virtual healthcare services, and disclosures on forward-looking statements Conference Call and Webcast Information The Q2 2025 earnings conference call was held on August 5, 2025, with a replay available for 90 days - The earnings conference call was held on August 5, 2025, at 8:30 a.m. E.T., with a replay available for 90 days[5] About Talkspace Talkspace is a leading provider of virtual behavioral healthcare, offering therapy and psychiatric treatment via a secure platform - Talkspace offers a comprehensive suite of virtual mental health services, including therapy and psychiatric treatment, through a fully-encrypted web and mobile platform[6][7][8] Forward-Looking Statements This press release contains forward-looking statements regarding financial condition and future performance, subject to risks and uncertainties - The report contains forward-looking statements that are subject to risks and uncertainties, and actual results may differ materially. The company directs readers to its SEC filings, such as the Form 10-K, for a full list of risk factors[9]