eHealth(EHTH) - 2025 Q2 - Quarterly Results

Q2 2025 Performance Highlights & CEO Commentary Q2 2025 Results Overview eHealth reported a strong Q2 2025, exceeding revenue and profitability expectations despite an 8% decrease in total revenue year-over-year to $60.8 million, driven by increased net adjustment revenue and reduced operating costs | Metric | Q2 2025 (in millions) | Q2 2024 (in millions) | Change (%) | | :------------------------------------- | :---------- | :---------- | :--------- | | Total Revenue | $60.8 | $65.9 | (8)% | | Net Adjustment Revenue | $17.8 | $11.5 | 54.8% | | Non-GAAP Total Revenue (excl. adj. rev) | $43.0 | $54.4 | (21)% | | Total Operating Costs & Expenses | $83.8 | $93.8 | (11)% | | GAAP Net Loss | $(17.4) | $(28.0) | 38% improvement | | Non-GAAP Net Loss | $(29.7) | $(34.3) | 13.4% improvement | | Adjusted EBITDA | $(14.1) | $(15.5) | 9% improvement | | MA Constrained LTV | +1% | | | | Medicare Supplement Constrained LTV | +29% | | | CEO Commentary CEO Fran Soistman highlighted eHealth's strong Q2 performance, exceeding expectations and demonstrating adaptability, with updated 2025 annual guidance and preparations for a dynamic Medicare Annual Enrollment Period - eHealth delivered a strong second quarter, exceeding revenue and profitability expectations[2] - Updated 2025 annual guidance ranges based on year-to-date performance[2] - Anticipates a dynamic Medicare Annual Enrollment Period (AEP) with elevated consumer shopping activity due to recent industry developments[2] - eHealth aims to differentiate itself as a trusted Medicare advisor with broad plan selection, omni-channel platform, and distinct brand[2] 2025 Financial Guidance Update eHealth revised its full-year 2025 financial guidance upwards, reflecting strong year-to-date performance, with higher ranges for total revenue, GAAP net income, and Adjusted EBITDA, while operating cash flow guidance remains consistent | Metric | Previous Guidance (Low, in millions) | Previous Guidance (High, in millions) | Revised Guidance (Low, in millions) | Revised Guidance (High, in millions) | | :----------------------- | :---------------------- | :----------------------- | :--------------------- | :---------------------- | | Total Revenue | $510.0 | $550.0 | $525.0 | $565.0 | | GAAP Net Income (Loss) | $(10.0) | $15.0 | $5.0 | $26.0 | | Adjusted EBITDA | $35.0 | $60.0 | $55.0 | $75.0 | | Operating Cash Flow | $(25.0) | $10.0 | $(25.0) | $10.0 | | Net Adjustment Revenue | $11.0 | $20.0 | $29.0 | $32.0 | Condensed Consolidated Financial Statements Condensed Consolidated Balance Sheets As of June 30, 2025, total assets decreased to $1,079.7 million from $1,155.4 million, primarily due to lower contract assets and accounts receivable, while total liabilities also significantly decreased | Balance Sheet Item | June 30, 2025 (in thousands) | December 31, 2024 (in thousands) | Change (in thousands) | | :----------------------------------- | :--------------------------- | :------------------------------- | :-------------------- | | Cash and cash equivalents | $65,920 | $39,197 | +$26,723 | | Short-term marketable securities | $39,280 | $43,043 | -$3,763 | | Accounts receivable | $1,856 | $16,807 | -$14,951 | | Contract assets – commissions receivable – current | $209,654 | $242,467 | -$32,813 | | Contract assets – commissions receivable – non-current | $707,337 | $757,523 | -$50,186 | | Total assets | $1,079,711 | $1,155,425 | -$75,714 | | Accounts payable | $5,748 | $23,448 | -$17,700 | | Accrued compensation and benefits | $17,054 | $43,888 | -$26,834 | | Short term debt | $69,087 | — | +$69,087 | | Long-term debt | — | $68,458 | -$68,458 | | Total liabilities | $165,878 | $229,488 | -$63,610 | | Total stockholders' equity | $554,923 | $588,428 | -$33,505 | Condensed Consolidated Statements of Operations For Q2 2025, total revenue decreased 8% to $60.8 million, but total operating costs and expenses decreased by 11%, leading to an 18% improvement in loss from operations and a 38% improvement in GAAP net loss | Metric (in thousands) | Q2 2025 | Q2 2024 | % Change (QoQ) | YTD 2025 | YTD 2024 | % Change (YTD) | | :----------------------------------- | :-------- | :-------- | :------------- | :--------- | :--------- | :------------- | | Commission Revenue | $54,731 | $56,847 | (4)% | $153,677 | $137,774 | 12% | | Other Revenue | $6,051 | $9,009 | (33)% | $20,224 | $21,046 | (4)% | | Total Revenue | $60,782 | $65,856 | (8)% | $173,901 | $158,820 | 9% | | Marketing and advertising | $21,425 | $26,783 | (20)% | $62,614 | $65,520 | (4)% | | Customer care and enrollment | $27,910 | $28,551 | (2)% | $65,131 | $61,452 | 6% | | Technology and content | $11,354 | $13,044 | (13)% | $23,955 | $26,349 | (9)% | | General and administrative | $21,582 | $22,402 | (4)% | $38,892 | $42,021 | (7)% | | Impairment, restructuring and other charges | $1,555 | $3,035 | (49)% | $1,555 | $9,348 | (83)% | | Total Operating Costs and Expenses | $83,826 | $93,815 | (11)% | $192,147 | $204,690 | (6)% | | Loss from Operations | $(23,044) | $(27,959) | 18% improvement | $(18,246) | $(45,870) | 60% improvement | | Net Loss | $(17,398) | $(27,968) | 38% improvement | $(15,448) | $(44,952) | 66% improvement | | Net Loss Attributable to Common Stockholders | $(29,783) | $(38,988) | 24% improvement | $(39,755) | $(66,699) | 40% improvement | | Basic and Diluted EPS | $(0.98) | $(1.33) | 26% improvement | $(1.32) | $(2.29) | 42% improvement | | Adjusted EBITDA | $(14,142) | $(15,540) | 9% improvement | $(1,621) | $(17,192) | 91% improvement | Condensed Consolidated Statements of Cash Flows For the six months ended June 30, 2025, net cash provided by operating activities was $35.9 million, while investing activities used $4.6 million, and overall cash, cash equivalents, and restricted cash increased by $26.7 million year-to-date | Cash Flow Item (in thousands) | Q2 2025 | Q2 2024 | YTD 2025 | YTD 2024 | | :------------------------------------------ | :-------- | :-------- | :--------- | :--------- | | Net cash provided by (used in) operating activities | $(41,204) | $(32,182) | $35,917 | $38,579 | | Net cash used in investing activities | $(10,119) | $(13,448) | $(4,647) | $(23,735) | | Net cash used in financing activities | $(3,844) | $(2,982) | $(4,543) | $(4,241) | | Net increase (decrease) in cash, cash equivalents and restricted cash | $(55,172) | $(48,642) | $26,723 | $10,622 | | Cash, cash equivalents and restricted cash at end of period | $69,010 | $129,434 | $69,010 | $129,434 | Segment Performance Analysis Medicare Segment The Medicare segment's total revenue decreased by 2% in Q2 2025 but increased by 14% year-to-date, with gross profit significantly increasing by 26% in Q2 due to reduced variable marketing and advertising expenses | Metric (in thousands) | Q2 2025 | Q2 2024 | % Change (QoQ) | YTD 2025 | YTD 2024 | % Change (YTD) | | :----------------------------------- | :-------- | :-------- | :------------- | :--------- | :--------- | :------------- | | Total Revenue | $58,059 | $59,248 | (2)% | $161,728 | $141,636 | 14% | | Variable marketing and advertising | $(13,800) | $(18,270) | 24% | $(47,553) | $(48,518) | 2% | | Medicare CC&E | $(25,078) | $(25,685) | 2% | $(59,547) | $(55,634) | (7)% | | Medicare segment gross profit | $19,145 | $15,204 | 26% | $54,892 | $37,252 | 47% | Employer and Individual (E&I) Segment The Employer and Individual (E&I) segment experienced a substantial 59% decline in total revenue in Q2 2025 to $2.7 million, resulting in a significant 107% decrease in segment gross profit, turning into a loss | Metric (in thousands) | Q2 2025 | Q2 2024 | % Change (QoQ) | YTD 2025 | YTD 2024 | % Change (YTD) | | :----------------------------------- | :-------- | :-------- | :------------- | :--------- | :--------- | :------------- | | Total Revenue | $2,723 | $6,608 | (59)% | $12,173 | $17,184 | (29)% | | Variable marketing and advertising | $(717) | $(698) | (3)% | $(1,907) | $(1,474) | (29)% | | E&I CC&E | $(2,201) | $(2,135) | (3)% | $(4,381) | $(4,412) | 1% | | E&I segment gross profit (loss) | $(257) | $3,682 | (107)% | $5,731 | $11,087 | (48)% | Consolidated Segment Gross Profit Reconciliation Consolidated total segment gross profit remained flat year-over-year in Q2 2025 at $18.9 million but increased by 25% year-to-date, driven by significant reductions in marketing, advertising, and impairment charges | Metric (in thousands) | Q2 2025 | Q2 2024 | % Change (QoQ) | YTD 2025 | YTD 2024 | % Change (YTD) | | :----------------------------------- | :-------- | :-------- | :------------- | :--------- | :--------- | :------------- | | Total segment gross profit | $18,888 | $18,886 | —% | $60,623 | $48,339 | 25% | | Other marketing and advertising | $(6,810) | $(7,633) | 11% | $(13,264) | $(15,085) | 12% | | Technology and content | $(11,354) | $(13,044) | 13% | $(23,955) | $(26,349) | 9% | | General and administrative | $(21,582) | $(22,402) | 4% | $(38,892) | $(42,021) | 7% | | Impairment, restructuring and other charges | $(1,555) | $(3,035) | 49% | $(1,555) | $(9,348) | 83% | | Loss before income taxes | $(24,052) | $(28,473) | 16% improvement | $(20,326) | $(46,802) | 57% improvement | Commission Revenue Breakdown Commission Revenue by Product Total commission revenue decreased by 4% in Q2 2025 to $54.7 million but increased by 12% year-to-date, with Medicare Supplement commissions seeing a significant 228% increase in Q2 | Product (in thousands) | Q2 2025 | Q2 2024 | % Change (QoQ) | YTD 2025 | YTD 2024 | % Change (YTD) | | :----------------------------------- | :-------- | :-------- | :------------- | :--------- | :--------- | :------------- | | Medicare Advantage | $38,264 | $42,168 | (9)% | $113,250 | $104,164 | 9% | | Medicare Supplement | $13,286 | $4,045 | 228% | $21,890 | $9,523 | 130% | | Medicare Part D | $(1,048) | $2,710 | (139)% | $1,395 | $5,395 | (74)% | | Total Medicare | $50,502 | $48,923 | 3% | $136,535 | $119,082 | 15% | | Non-Qualified Health Plans | $(434) | $388 | (212)% | $484 | $2,033 | (76)% | | Qualified Health Plans | $(402) | $710 | (157)% | $1,363 | $2,756 | (51)% | | Total Individual and Family | $(836) | $1,098 | (176)% | $1,847 | $4,789 | (61)% | | Ancillary | $2,249 | $2,555 | (12)% | $8,081 | $5,243 | 54% | | Small Business | $2,297 | $2,563 | (10)% | $5,731 | $6,179 | (7)% | | Commission Bonus and Other | $519 | $1,708 | (70)% | $1,483 | $2,481 | (40)% | | Total Commission Revenue | $54,731 | $56,847 | (4)% | $153,677 | $137,774 | 12% | Commission Revenue by Segment Medicare segment commission revenue increased by 3% in Q2 2025 and 17% year-to-date, driven by higher net commission revenue from prior periods, while the Employer and Individual segment's commission revenue decreased substantially | Segment (in thousands) | Q2 2025 | Q2 2024 | YTD 2025 | YTD 2024 | | :------------------------------------------------- | :-------- | :-------- | :--------- | :--------- | | Medicare | | | | | | Commission revenue from members approved during the period | $33,148 | $39,941 | $114,902 | $109,693 | | Net commission revenue from members approved in prior periods | $19,089 | $10,681 | $27,054 | $11,683 | | Total Medicare segment commission revenue | $52,237 | $50,622 | $141,956 | $121,376 | | Employer and Individual | | | | | | Commission revenue from members approved during the period | $1,920 | $3,265 | $5,778 | $8,942 | | Commission revenue from renewals of small business members | $1,892 | $2,142 | $4,742 | $5,170 | | Net commission revenue from members approved in prior periods | $(1,318) | $818 | $1,201 | $2,286 | | Total Employer and Individual segment commission revenue | $2,494 | $6,225 | $11,721 | $16,398 | | Total commission revenue | $54,731 | $56,847 | $153,677 | $137,774 | Key Operating Metrics Approved Members Total approved members decreased by 13% in Q2 2025 to 48,936, primarily due to declines in Medicare Advantage and Individual and Family members, but increased 4% year-to-date driven by Medicare Advantage growth | Approved Members | Q2 2025 (Count) | Q2 2024 (Count) | % Change (QoQ) | YTD 2025 (Count) | YTD 2024 (Count) | % Change (YTD) | | :----------------------- | :-------- | :-------- | :------------- | :--------- | :--------- | :------------- | | Medicare Advantage | 30,568 | 37,638 | (19)% | 113,239 | 103,388 | 10% | | Medicare Supplement | 1,730 | 1,954 | (11)% | 4,295 | 8,136 | (47)% | | Medicare Part D | 1,378 | 1,468 | (6)% | 4,020 | 5,043 | (20)% | | Total Medicare | 33,676 | 41,060 | (18)% | 121,554 | 116,567 | 4% | | Individual and Family | 2,062 | 3,508 | (41)% | 7,879 | 10,668 | (26)% | | Ancillary | 12,360 | 11,078 | 12% | 29,285 | 25,028 | 17% | | Small Business | 838 | 922 | (9)% | 2,028 | 2,564 | (21)% | | Total Approved Members | 48,936 | 56,568 | (13)% | 160,746 | 154,827 | 4% | Constrained Lifetime Value (LTV) of Commissions per Approved Member In Q2 2025, Constrained LTV per approved member for Medicare Advantage increased by 1% to $934, and Medicare Supplement LTV significantly increased by 29% to $1,435, while Medicare Part D LTV decreased by 24% | LTV per Approved Member | Q2 2025 ($) | Q2 2024 ($) | % Change | | :----------------------------------- | :-------- | :-------- | :--------- | | Medicare Advantage | $934 | $927 | 1% | | Medicare Supplement | $1,435 | $1,112 | 29% | | Medicare Part D | $171 | $225 | (24)% | | Non-Qualified Health Plans | $328 | $353 | (7)% | | Qualified Health Plans | $315 | $354 | (11)% | | Short-term Ancillary | $111 | $172 | (35)% | | Dental Ancillary | $125 | $122 | 2% | | Vision Ancillary | $84 | $76 | 11% | | Small Business | $263 | $253 | 4% | Expense Metrics per Approved Member In Q2 2025, Customer Care & Enrollment (CC&E) cost per MA-equivalent approved member increased by 11% to $664, while variable marketing cost decreased by 7% to $423, but both costs significantly increased for IFP-equivalent approved members | Expense Metric | Q2 2025 ($) | Q2 2024 ($) | % Change | | :------------------------------------------ | :-------- | :-------- | :--------- | | Medicare Plans | | | | | CC&E cost per MA-equivalent approved member | $664 | $599 | 11% | | Variable marketing cost per MA-equivalent approved member | $423 | $457 | (7)% | | Total acquisition cost per MA-equivalent approved member | $1,087 | $1,056 | 3% | | Individual and Family Plans ("IFP") | | | | | CC&E cost per IFP-equivalent approved member | $422 | $284 | 49% | | Variable marketing cost per IFP-equivalent approved member | $99 | $59 | 68% | | Total acquisition cost per IFP-equivalent approved member | $521 | $343 | 52% | Estimated Membership As of June 30, 2025, total estimated membership decreased by 3% year-over-year to 1,145,603, primarily due to declines in Medicare Supplement, Medicare Part D, Individual and Family, and Small Business memberships | Estimated Membership | June 30, 2025 (Members) | June 30, 2024 (Members) | % Change | | :----------------------- | :-------------- | :-------------- | :--------- | | Medicare Advantage | 596,397 | 584,649 | 2% | | Medicare Supplement | 91,845 | 97,426 | (6)% | | Medicare Part D | 176,223 | 195,671 | (10)% | | Total Medicare | 864,465 | 877,746 | (2)% | | Individual and Family | 66,374 | 79,786 | (17)% | | Ancillary | 174,632 | 174,107 | —% | | Small Business | 40,132 | 45,101 | (11)% | | Total Estimated Membership | 1,145,603 | 1,176,740 | (3)% | Non-GAAP Financial Measures Reconciliation Operating Costs and Expenses Reconciliation eHealth provides reconciliations from GAAP to Non-GAAP operating costs and expenses by excluding stock-based compensation and impairment/restructuring charges, with total non-GAAP operating costs and expenses decreasing by 8.5% in Q2 2025 | Metric (in thousands) | Q2 2025 | Q2 2024 | YTD 2025 | YTD 2024 | | :----------------------------------- | :-------- | :-------- | :--------- | :--------- | | GAAP marketing and advertising expense | $21,425 | $26,783 | $62,614 | $65,520 | | Non-GAAP marketing and advertising expense | $20,840 | $26,072 | $61,532 | $64,165 | | GAAP customer care and enrollment expense | $27,910 | $28,551 | $65,131 | $61,452 | | Non-GAAP customer care and enrollment expense | $27,578 | $28,040 | $64,535 | $60,417 | | GAAP technology and content expense | $11,354 | $13,044 | $23,955 | $26,349 | | Non-GAAP technology and content expense | $10,674 | $12,265 | $22,587 | $24,596 | | GAAP general and administrative expense | $21,582 | $22,402 | $38,892 | $42,021 | | Non-GAAP general and administrative expense | $19,303 | $19,297 | $34,273 | $35,518 | | GAAP operating costs and expenses | $83,826 | $93,815 | $192,147 | $204,690 | | Non-GAAP operating costs and expenses | $78,395 | $85,674 | $182,927 | $184,696 | Net Loss and Adjusted EBITDA Reconciliation For Q2 2025, GAAP net loss attributable to common stockholders was $(29.8) million, which reconciles to an Adjusted EBITDA of $(14.1) million after various add-backs, while Non-GAAP net loss was $(29.7) million | Metric (in thousands) | Q2 2025 | Q2 2024 | YTD 2025 | YTD 2024 | | :------------------------------------------------- | :-------- | :-------- | :--------- | :--------- | | GAAP net loss attributable to common stockholders | $(29,783) | $(38,988) | $(39,755) | $(66,699) | | GAAP net loss | $(17,398) | $(27,968) | $(15,448) | $(44,952) | | Adjusted EBITDA | $(14,142) | $(15,540) | $(1,621) | $(17,192) | | Adjusted EBITDA margin | (23)% | (24)% | (1)% | (11)% | | Non-GAAP net loss | $(29,678) | $(34,317) | | | | Adjusted EBITDA excluding net adjustment revenue | $(31,913) | $(27,039) | | | Total Revenue Reconciliation Non-GAAP total revenue excluding net adjustment revenue for Q2 2025 was $43.0 million, a 21% decrease from Q2 2024, calculated by subtracting net adjustment revenue from GAAP total revenue | Metric (in thousands) | Q2 2025 | Q2 2024 | $ Change | % Change | | :------------------------------------------ | :-------- | :-------- | :--------- | :--------- | | GAAP total revenue | $60,782 | $65,856 | $(5,074) | (8)% | | Net adjustment revenue | $(17,771) | $(11,499) | $6,272 | 55% | | Non-GAAP total revenue excluding net adjustment revenue | $43,011 | $54,357 | $(11,346) | (21)% | Guidance Adjusted EBITDA Reconciliation eHealth's full-year 2025 Adjusted EBITDA guidance ranges from $55.0 million to $75.0 million, reconciled from GAAP net income guidance by adding back preferred stock impact, stock-based compensation, depreciation, interest, and taxes | Metric (in millions) | Full Year 2025 Guidance (Low) | Full Year 2025 Guidance (High) | | :----------------------------------- | :---------------------------- | :----------------------------- | | GAAP net loss attributable to common stockholders | $(45.0) | $(24.0) | | GAAP net income | $5.0 | $26.0 | | Stock-based compensation expense | $15.0 | $12.0 | | Depreciation and amortization | $18.0 | $17.0 | | Interest expense | $11.0 | $10.0 | | Provision for income taxes | $9.0 | $13.0 | | Adjusted EBITDA | $55.0 | $75.0 | Company Information & Footnotes About eHealth, Inc. eHealth, Inc. is a leading private online health insurance marketplace with over 25 years of experience, connecting millions of Americans with suitable and affordable healthcare coverage - eHealth is a leading private online health insurance marketplace[9] - Helps Americans find healthcare coverage for over 25 years[9] - Operates as an independent licensed insurance agency and advisor[9] - Offers access to over 180 health insurers[9] Forward-Looking Statements and Risk Factors The press release contains forward-looking statements subject to various risks and uncertainties, including regulatory changes, competition, seasonality, and the ability to estimate key metrics - Statements are forward-looking and subject to risks and uncertainties[10] - Key risks include ability to retain/enroll members, changes in laws/regulations, competition, seasonality, accuracy of membership/LTV estimates, carrier relationships, security risks, and macroeconomic conditions[10][14] - Specifically mentions a complaint filed by the U.S. Attorney's Office alleging violation of the Federal False Claims Act[10][14] Webcast and Investor Relations Information eHealth held a webcast and conference call on August 6, 2025, to discuss its Q2 2025 results, with investor relations contact information and website links provided for further inquiries - Webcast and conference call held on August 6, 2025, at 8:30 a.m. Eastern Time[8] - Investor Relations contact: Kate Sidorovich, CFA, Senior Vice President, Investor Relations & Strategy[16] - Investor Relations website: **https://ir.ehealthinsurance.com**[16](index=16&type=chunk) Non-GAAP Financial Information Definitions This section defines non-GAAP financial measures such as non-GAAP total revenue, operating costs, net income (loss), and Adjusted EBITDA, explaining their use and limitations as supplements to GAAP statements - Non-GAAP measures supplement GAAP financial statements for management and investors[52] - Non-GAAP total revenue excludes net commission revenue from prior periods[52] - Non-GAAP operating costs exclude stock-based compensation and impairment/restructuring charges[54] - Adjusted EBITDA excludes preferred stock impact, taxes, depreciation, stock-based compensation, impairment, interest, and other non-recurring charges from GAAP net loss[56] - Acknowledges limitations of non-GAAP measures as they don't reflect all costs and should not be considered in isolation[56] Metrics Definitions This section provides detailed definitions for key operating metrics including Approved Members, Constrained Lifetime Value (LTV) of Commissions per Approved Member, Expense Metrics per Approved Member, and Estimated Membership - Approved Members: Number of individuals on applications approved by carriers during the period[58] - Constrained LTV of Commissions per Approved Member: Estimated commissions collected over a plan's life, applying constraints per revenue recognition policy, considering factors like commission rates, carrier mix, plan duration, regulatory environment, and cancellations[59][60] - Expense Metrics per Approved Member: Calculates CC&E and variable marketing costs per MA-equivalent or IFP-equivalent approved member, based on relative LTVs[62] - Estimated Membership: Estimated active members based on commission payments received/applied and approved members, adjusted for historical cancellations, and not updated for prior periods[64]