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LifeMD, Inc. (LFMD)·Q2 2025 Earnings Summary

Executive Summary

  • Q2 2025 revenue rose 23% year over year to $62.2M, gross margin was 88%, and adjusted EBITDA was $7.1M; GAAP diluted EPS was -$0.06, improving from -$0.19 in Q2 2024 .
  • Versus consensus, LifeMD missed on revenue and EPS: Revenue $62.2M vs ~$66.3M consensus* and EPS -$0.06 vs ~-$0.01 consensus*, largely due to temporary performance challenges at RexMD and higher weight-management refund rates .
  • FY 2025 guidance was lowered: Total revenue to $250–$255M (from $268–$275M), adjusted EBITDA to $27–$29M (from $31–$33M); telehealth revenue and telehealth adjusted EBITDA also reduced, citing RexMD CAC pressure and downstream subscription effects .
  • Stock reaction: following the Aug 5 release and guidance cut, shares fell $5.31 (44.85%) to close at $6.53 on Aug 6, 2025, highlighting investor sensitivity to guidance and RexMD execution .

What Went Well and What Went Wrong

  • What Went Well
    • Telehealth revenue up 30% YoY to $48.6M with telehealth adjusted EBITDA up 560% to $3.4M; CFO: “Telehealth revenue grew 30% year-over-year and telehealth adjusted EBITDA increased 560%” .
    • Operating execution: >$8M operating cash flow, cash $36.2M at quarter-end, and all senior debt repaid shortly after quarter-end, strengthening the balance sheet .
    • Strategic expansion: nationwide behavioral health launch, acquisition to accelerate women’s health, and scaling LifeMD+ membership; CEO called Q2 “extremely productive” with “transformational expansion” into underserved areas .
  • What Went Wrong
    • RexMD headwinds: elevated customer acquisition costs (CAC) in ED drove lower new subscriber volume and downstream revenue; guidance cut attributed “mostly” to RexMD performance .
    • Weight management refunds: higher-than-anticipated refund rates for patients lacking insurance coverage or unable to afford branded GLP‑1 therapies pressured results near term .
    • Gross margin compression: 88% vs 90% prior-year due to revenue mix and higher allocation of physician costs to COGS driven by utilization .

Financial Results

MetricQ4 2024Q1 2025Q2 2025
Revenue ($USD Millions)$64.255 $65.698 $62.218
GAAP Diluted EPS ($USD)-$0.02 $0.01 -$0.06
Gross Margin (%)85% 87% 88%
Adjusted EBITDA ($USD Millions)$8.982 $8.659 $7.120

Segment revenue breakdown:

Segment Revenue ($USD Millions)Q4 2024Q1 2025Q2 2025
Telehealth$49.889 $52.456 $48.564
WorkSimpli$14.365 $13.241 $13.655
Total$64.255 $65.698 $62.218

Key KPIs:

KPIQ4 2024Q1 2025Q2 2025
Telehealth Active Subscribers275,267 290,660 296,946
WorkSimpli Active Subscribers163,743 158,265 149,465
Total Active Subscribers439,010 448,925 446,411

Actual vs S&P Global consensus (Q2 2025):

MetricActualConsensusSurprise
Revenue ($USD Millions)$62.218 $66.313*Miss: -$4.095M*
Primary EPS ($USD)-$0.06 -$0.01*Miss: -$0.05*

Values retrieved from S&P Global.*

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Total RevenueFY 2025$268–$275M $250–$255M Lowered
Telehealth RevenueFY 2025$208–$213M $195–$200M Lowered
Adjusted EBITDAFY 2025$31–$33M $27–$29M Lowered
Telehealth Adjusted EBITDAFY 2025~>$21M $14–$16M Lowered
Total RevenueQ3 2025N/A$61–$63M New
Adjusted EBITDAQ3 2025N/A$6–$7M New
Telehealth RevenueQ3 2025N/A$48–$50M New
Telehealth Adjusted EBITDAQ3 2025N/A$3–$4M New

Earnings Call Themes & Trends

TopicPrevious Mentions (Q4 2024, Q1 2025)Current Period (Q2 2025)Trend
AI/Technology initiativesFocus on platform quality and integration; setup for 2025 growth CEO: integrating AI “into every aspect of operations” to improve productivity and outcomes Increasing emphasis
Weight management (GLP‑1)Strong program momentum; LillyDirect integration; Medicare launch anticipated Robust demand but higher refund rates; scaling coverage/affordability; expand oral therapies; add liraglutide Mixed near term; positive medium term
RexMD (men’s health)HRT uptake; strong growth outlook Elevated CAC in ED; actions taken; acquisitions/day improving to ~85–90% of historical; guidance cut largely due to Q2 RexMD Near-term headwind, stabilizing
Insurance/Medicare coverageMedicare launch slated for April; payer infrastructure expansion >100 plans across 40 states; ~80M lives; scaling more in 2026; Medicare expansion targeted in 2H after structural updates Building capacity; medium-term scaling
Behavioral & Women’s HealthBehavioral entry announced; women’s program planned Behavioral live in 50 states; women’s health to launch end of Q3; accretive to 2026 results New growth vectors
Regulatory/legalLitigation costs in non-GAAP reconcilers Continued litigation costs (Marden case) included in adjusted EBITDA reconciliation Ongoing cost headwind

Management Commentary

  • CEO: “The second quarter of 2025 was an extremely productive quarter… Our platform is undergoing a transformational expansion… I believe we are exceptionally well positioned to transform the lives of millions of Americans in the years ahead.” .
  • CFO: “Telehealth revenue grew 30% year-over-year and telehealth adjusted EBITDA increased 560%… We exited the quarter with $36.2 million in cash and have now fully paid off all senior debt… Due to some temporary challenges facing our Rex MD business—which are now largely resolved—we are revising our full-year 2025 guidance…” .
  • CEO on strategy: scaling LifeMD+ and expanding behavioral/women’s health; premium membership driving retention and margin expansion .
  • CFO on refunds/CAC: weight management ahead of plan but higher refund rates; RexMD CAC spikes (15–25% sequential in parts of Q2) drove volume pullback, downstream subscription impact; performance improvements already underway .

Q&A Highlights

  • Insurance coverage: contracted with 100+ plans across 40 states, ~80M covered lives; unit economics for insured patients encouraging; broader scaling expected in 2026 .
  • RexMD dynamics: CAC pressures up 15–25% at times; actions taken returned CAC/acquisitions/day to near historical levels; FY guide embeds prudence without assuming full rebound .
  • LifeMD+ marketing: measured scaling; plan includes spend increase in back half but not “very significant”; focus on balanced profitability growth .
  • Behavioral health: nationwide launch live; onboarding daily; expect scaling in 30–60 days and accretive in 2026 .
  • Medicare: reworking medical group structure; expansion to 49 states targeted by year end; scaling expected in 2H 2025 .
  • Refund policy: liberal refunds when therapy not accessed or unaffordable; competitive pressure from low-cost compounded GLP‑1s contributes to higher refunds .

Estimates Context

  • Q2 2025 actual vs consensus: Revenue $62.2M vs ~$66.3M*, EPS -$0.06 vs ~-$0.01*; both misses driven by RexMD acquisition inefficiencies and weight-management refunds .
  • Q3 2025 setup: Company guides revenue $61–$63M and adjusted EBITDA $6–$7M vs S&P Global revenue consensus ~$62.13M* and EPS consensus ~-$0.045*; guidance aligns with cautious recovery trajectory .
  • FY 2025 implication: Lowered guidance ($250–$255M revenue, $27–$29M adjusted EBITDA) suggests consensus revisions down across revenue, EBITDA, and EPS near term .
    Values retrieved from S&P Global.*

Key Takeaways for Investors

  • The quarter showed durable telehealth growth and cash generation, but headline misses vs estimates and a notable guidance cut were driven by RexMD CAC spikes and weight-management refund rates; watch CAC normalization and refund mitigation to gauge momentum into Q3/Q4 .
  • Balance sheet strengthened with full senior debt repayment and $36.2M cash; supports continued investment in behavioral, women’s health, and LifeMD+ initiatives .
  • Strategic diversification (behavioral, women’s health, LifeMD+) and AI-enabled operations position the model for margin expansion in 2026+, but near-term execution in RexMD and payer coverage expansion are critical .
  • Insurance pathway: >100 plans/40 states with ~80M lives; broader scaling likely in 2026; expect cohort LTV improvement with insured patients, potentially easing refund pressure .
  • Guidance prudence: Q3 guide and FY reset embed conservative assumptions around RexMD rebound; upside hinges on faster CAC normalization and weight-management coverage/pricing tailwinds .
  • Legal overhang: ongoing litigation costs appear in non-GAAP reconciliations; monitor developments though core operations remain the primary driver .
  • Trading lens: stock’s sharp drop post print reflects sensitivity to growth visibility; near-term catalysts include evidence of RexMD recovery, payer coverage wins, behavioral/women’s health scaling, and LifeMD+ attach/retention metrics .