eHealth Reports Mixed Q3 Results with 10% Revenue Decline, Net Loss Widens

eHealth, Inc. reported its financial results for the third quarter and the nine months ended September 30, 2024, revealing a mixed performance in revenue and profitability compared to the previous fiscal period. Total revenue for the three months was $58.4 million, a decrease of 10% from $64.7 million in the same period of 2023. However, for the nine months, revenue increased by 6% to $217.2 million, up from $205.2 million year-over-year.

The company's Medicare segment saw a decline in commission revenue for the third quarter, dropping by $5.0 million (10%) to $43.4 million, attributed to lower net adjustment revenue from prior enrollments. Conversely, the Medicare segment's revenue for the nine months rose by $22.1 million (13%) to $194.9 million, driven by increased commission revenue and fee-based revenue. The Employer and Individual (E&I) segment, however, faced a significant revenue decline of 44% in the third quarter, totaling $4.8 million, and a 31% decrease for the nine months, reflecting challenges in member approvals across individual and family plans.

Profitability metrics showed a worsening trend, with a net loss of $42.5 million for the third quarter, compared to a loss of $37.0 million in the same period of 2023. The net loss attributable to common stockholders for the third quarter was $(53.9 million), up from $(47.2 million) a year earlier. For the nine months, the net loss increased to $(87.4 million) from $(80.4 million) in 2023.

eHealth's total assets decreased to $1.0 billion as of September 30, 2024, down from $1.1 billion at the end of 2023. Cash and cash equivalents also fell significantly to $64.0 million from $115.7 million. The company reported a notable increase in short-term marketable securities, which rose to $53.8 million from $5.9 million at the end of 2023.

Strategically, eHealth has focused on enhancing its marketing efforts and diversifying revenue streams, particularly in the Medicare segment, which has shown strong enrollment growth. The company has also implemented operational enhancements that have led to a decline in approved members in certain segments, such as individual and family plans, which decreased by 23% in the third quarter.

In terms of expenses, marketing and advertising costs rose by 2% in the third quarter, while general and administrative expenses decreased by 12%. The company has also recognized restructuring charges related to employee termination benefits, totaling $2.0 million for the nine months ended September 30, 2024.

Overall, eHealth continues to navigate a challenging market environment, with strategic initiatives aimed at improving its operational efficiency and revenue generation capabilities.