GoHealth, Inc. Form 10-Q for the Quarterly Period Ended March 31, 2024

Press release · 05/10 10:44

GoHealth, Inc. has released its quarterly report for the period ended March 31, 2024. The report provides an overview of the company’s financial performance and developments during the quarter.

Overview

Revenue and Profit Trends

GoHealth is evolving to an engagement model focused on building long-term relationships with consumers. Non-agency revenue, which includes enrollment and engagement services, increased significantly to $81.3 million, up 46% of total Medicare revenue compared to 27% in the prior year period. This drove an increase in total revenue to $185.6 million, up 1.3%. However, net loss widened to $21.3 million from $22.5 million due to investments in targeted marketing and higher operating expenses.

Strengths

Shift to non-agency model provides more recurring revenue and cash upfront
Encompass platform puts consumer at center to drive trusted relationships
Strong growth in non-agency revenue to $81.3 million, up 51%

Weaknesses

Net loss widened by $1.2 million compared to prior year period
Decline in Submissions as agent of record impacted agency revenue
Adjusted EBITDA declined by $1.9 million or 6.5%

Outlook

GoHealth is well positioned to help consumers navigate an increasingly complex Medicare landscape, reinforced by CMS Final 2025 Marketing Rule. Investments in Customer 360 and other technologies aim to drive efficiency and personalized service. Focused on higher quality Submissions through enhancements in training, technology and retention strategies.

Financial Performance

Revenue

Total revenue grew 1.3% to $185.6 million
Growth driven by non-agency revenue of $81.3 million, up 51%
- Includes enrollment and engagement services
Offset by decline in agency revenue as Submissions as agent of record decreased

Expenses

Operating expenses increased 0.4% to $189.6 million
Increase driven by investments in targeted marketing and higher consumer care expenses to support non-agency model
Offset by 16.4% decrease in revenue share expense

Profitability

Net loss widened by $1.2 million to $21.3 million
Adjusted EBITDA declined $1.9 million or 6.5% to $26.9 million
Adjusted EBITDA margin contracted 150 basis points to 14.5%

Cash Flow

Cash from operations decreased by $8.0 million to $12.5 million
Driven by $10.5 million payment related to Securities Class Action settlement
Cash collections also impacted by shift to more non-agency revenue

Key Metrics

Submissions

Submissions increased 1.2% compared to prior year period to 216,148
Growth driven by targeted marketing and enhancements in training, technology and retention

Sales Per Submission

Increased 7.8% to $856 per Submission
Increase attributable to strong growth in non-agency revenue

Cost Per Submission

Increased 8.3% to $640 per Submission
Driven by investments in targeted marketing and increased agent headcount

Outlook

GoHealth is strategically positioned as Medicare landscape grows increasingly complex. Shift to non-agency model aims to drive more recurring revenue while focus remains on building trusted relationships with consumers through investments in the Encompass platform. With double digit growth in non-agency revenue and over 200,000 Submissions, the company believes it has strong momentum entering the key Annual Enrollment Period later this year. Profitability is expected to improve over time as investments in targeted marketing and other growth initiatives begin to drive additional productivity gains.

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