American Well Corporation Reports 13% Revenue Growth and Improved Operational Efficiency in Q2 2025

American Well Corporation (Amwell) reported its financial results for the second quarter of 2025, revealing a revenue increase of 13% year-over-year, reaching $70.9 million compared to $62.8 million in the same period of 2024. For the first half of 2025, total revenue was $137.7 million, up from $122.3 million in the prior year. The growth in revenue was primarily driven by a significant rise in subscription fees, which increased to $40.5 million from $27.5 million in the second quarter of 2024. However, the company also reported a net loss of $19.5 million for the quarter, a substantial improvement from the $50.6 million loss recorded in the same period last year.

The company’s operational efficiency improved, as total costs and operating expenses decreased by 21% to $91.3 million for the second quarter, down from $115.2 million in 2024. This reduction was attributed to lower costs of revenue, which fell by 21% to $31.1 million, and a significant decrease in sales and marketing expenses, which dropped by 32% to $12.5 million. The company also noted a 12% reduction in research and development costs, reflecting its ongoing efforts to streamline operations and reduce expenditures.

In terms of strategic developments, Amwell completed the divestiture of its telepsychiatry business, Aligned Telehealth, which generated a gain of $10.7 million. This divestiture was part of a broader strategy to focus on its core offerings, particularly the Amwell Converge platform, which aims to enhance digital care delivery. The company also reported a decrease in its employee headcount by approximately 22% year-over-year, contributing to reduced operational costs.

Amwell's user engagement metrics showed a decline in total visits, with 2.5 million virtual care visits recorded in the first half of 2025, down from 3.2 million in the same period of 2024. The company attributed this decrease to the divestiture of the APC business, which had previously contributed to visit revenue. Despite this, the company continues to expand its client base, serving approximately 50 health plans and 100 health systems, representing over 80 million covered lives.

Looking ahead, Amwell remains focused on enhancing its digital care offerings and expects to leverage its existing cash reserves of $219.1 million to support growth initiatives. The company anticipates continued operating losses in the near term but is optimistic about achieving profitability through strategic transformations and increased adoption of its digital care solutions. The management emphasized the importance of maintaining operational efficiency and adapting to market conditions as it navigates the evolving landscape of digital healthcare.