American Well NYSE: AMWL executives highlighted progress toward profitability and described what they see as rising demand for a unified telehealth platform during the company’s first-quarter fiscal 2026 earnings call. Chairman and CEO Dr. Ido Schoenberg pointed to large customer renewals, government deployments, and a regulatory environment he said is increasingly supportive of telehealth.
Management frames platform strategy around payer and government demand
Schoenberg said the company spent the past year focusing on “solving clear, urgent customer needs” by consolidating around a unified platform. He argued that payers, facing margin pressure as “premiums are not keeping pace with the total cost of care,” are increasingly turning to technology-enabled care and “AI-powered clinical programs” as a cost and outcomes lever.
He also emphasized what he called a key adoption barrier for customers: vendor sprawl and fragmented tech stacks that make it difficult to integrate point solutions and measure performance across programs. Amwell’s approach, he said, is to provide a “trusted, proven technology-enabled care infrastructure” that customers can white label and embed into their own digital front doors, along with unified engagement, navigation, and analytics capabilities.
Schoenberg said the platform is positioned for a shift from generative AI toward “agentic AI,” describing Amwell as “the infrastructure layer where AI-powered care becomes operational and measurable.” He added that a unified data structure across programs could be a competitive advantage by enabling information sharing before care begins and consolidating outcomes data after delivery.
Customer validation: Elevance renewal and DHA global deployment
Schoenberg said Elevance Health renewed its relationship with Amwell for three more years, calling it “a strong vote of confidence in our platform.” On the government side, he cited the Military Health System contract extension in August 2025, which he said put Amwell’s platform in front of 9.6 million military beneficiaries globally.
During Q&A, management addressed questions about the Defense Health Agency (DHA) relationship and renewal timing. Schoenberg said Amwell’s focus is on meeting DHA’s “very specific and high expectations,” adding that while “many other players” are involved, Amwell’s integration into DHA’s backbone “remains constant.” He said the company is “fairly confident and hopeful” about continuing to serve the customer, while noting it cannot be taken for granted.
CFO and COO Mark Hirschhorn said the DHA renewal is expected to be “completed at the end of the quarter, start of the third quarter, perhaps July.” He added that any expansion would likely come after the base renewal and said Amwell feels “very confident that that renewal is going to commence within that timeframe.”
On potential scope expansion, Schoenberg said Amwell is “laser-focused” on renewing the current scope and does not have specific information “as to the if and when” for expansion. Hirschhorn later addressed a lapsed component of the DHA relationship, saying the company expects that portion would represent “in excess of 15%–20% of the total value of the platform today,” based on DHA’s usage in early 2025. He said discussions around reintroducing those services are ongoing but would likely take place after renewal of base services.
Schoenberg described that additional program as an “automated behavioral health program,” which he said had been integrated and proven in the DHA environment but was deferred by the customer for its own reasons. He added that if the customer chooses to add it back, deployment would be quick. He also referenced use in the U.K.’s National Health Service, saying studies showed the program could improve the therapist-to-patient ratio and accelerate access.
Regulatory tailwinds and operating changes
Schoenberg said the regulatory environment is “working in our favor,” citing CMS actions that he said make telehealth “permanently accessible,” including the removal of rural geographic restrictions, home-based telehealth extended through at least 2027, and virtual behavioral health as a permanent part of Medicare. He also pointed to new reimbursement codes for advanced primary care management and behavioral health integration as additional incentives to shift care to virtual and community-based settings.
He also described internal changes, saying the company has made “meaningful operational improvements” and “significant organizational changes.” Hirschhorn echoed that theme, citing continued cost discipline and transformation actions.
Q1 results: revenue decline, improved profitability metrics
Hirschhorn reported total revenue of $54.9 million for the first quarter, down about 18% year-over-year. Subscription revenue was $24.9 million, down about 23% year-over-year, which he attributed primarily to “previously disclosed churn.” However, he said renewals and retention were higher than budgeted in the quarter, improving confidence in subscription stability.
Amwell Medical Group (AMG) visit revenue was $28.9 million, up about 9% year-over-year. Hirschhorn said AMG paid visits were approximately 382,000, up slightly year-over-year, with revenue per visit of about $76, up roughly $5 per visit from the prior year. He attributed the change to a growing contribution from clinical programs and a shift toward “higher acuity, higher value care.” Virtual primary care visits grew about 57% year-over-year, which he said reflects increasing adoption among clients.
Total platform visits were 1 million, down about 19% year-over-year, which Hirschhorn said was in line with previously discussed portfolio changes.
Gross profit was $28 million and gross margin was 51%, down about 180 basis points year-over-year. Hirschhorn said the existing revenue mix is likely to generate a similar near-term margin profile, while a longer-term shift toward higher-margin SaaS offerings could support margin expansion over several years.
Operating expenses were $45.4 million, down about 31% year-over-year. As a percentage of revenue, operating expenses improved to 82.6% from 98.3% in the prior-year quarter. Adjusted EBITDA loss narrowed to $3.1 million versus a $12.2 million loss in Q1 2025, a $9.1 million improvement. Operating loss was $17.4 million, compared with $30.4 million in the prior-year period.
On liquidity, Hirschhorn said cash burn was about $3.1 million, down from $19 million last quarter, and the company ended the quarter with $179 million in cash and investments and “zero debt.” Schoenberg separately referenced $182 million in cash and no debt in his prepared remarks and reiterated a goal of reaching cash flow breakeven in the fourth quarter.
Outlook: Q2 seasonality, improved full-year adjusted EBITDA guidance
For the second quarter of fiscal 2026, Hirschhorn guided to revenue of $48 million to $52 million and an adjusted EBITDA loss of negative $4 million to negative $2 million. He said the outlook reflects normal seasonality in visit volumes and a continued step-down in subscription revenue tied to previously discussed churn.
For the full year, he reiterated the revenue outlook of $195 million to $205 million and raised expectations for adjusted EBITDA, now projecting a loss of $16 million to $12 million compared with a prior range of a loss of $24 million to $18 million. Hirschhorn said Q1 performance increased confidence in the goal of achieving positive cash flow from operations in Q4.
On volume trends, Hirschhorn told analysts Amwell saw “high-single-digit growth in volume” and did not experience softness cited by some providers, instead seeing a seasonal boost through the end of the quarter, supported in part by additional ASO clients participating in offerings the company introduced. He added that seasonality is now setting in as expected.
Discussing AI, Schoenberg said some AI-related modules tied to navigation and analytics are not universally adopted, with some customers cautious. However, he said customers are “eager and ready to test AI-driven clinical programs” on the platform because integration is fast and replacement is even faster, enabling risk management while evaluating innovations.
On pipeline commentary, Schoenberg said the company’s platform is resonating across payers, health systems, and government, with the “most pressing need” among large payers. Hirschhorn added that the pipeline is “a multiple of what it had been last year,” describing it as “closer to triple digit,” and said it is “primarily” aligned with government opportunities. He also said 2026 churn has been “immaterial,” and that while low-single-digit churn is expected in a competitive market, the company has “significant expectations for revenue growth,” including what he described as potential meaningful improvement in 2027 from new government contracts.
About American Well NYSE: AMWL
American Well, operating under the trade name Amwell, is a Boston-based digital health company that develops and delivers telehealth solutions to healthcare providers, payers, employers and patients. Through its cloud-based platform, the company enables secure virtual visits, remote patient monitoring and integrated care coordination across a range of medical disciplines, including primary care, behavioral health, chronic disease management and urgent care.
The company's core offering, the Amwell Telehealth Platform, facilitates live video consultations, asynchronous messaging, e-prescribing and electronic health record integration.
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