August 9, 2021

Q2 Net revenue grew 73% year-over-year to approximately $31 million

Q2 Total active members grew more than 40% year-over-year to approximately 61,500

Reaffirm FY 2021 Net revenue guidance, expecting 64% year-over-year growth

NEW YORK, Aug. 09, 2021 (GLOBE NEWSWIRE) --  Talkspace, Inc. (“Talkspace”) (Nasdaq: TALK), a leading virtual behavioral healthcare company, today reported financial results for the second quarter ended June 30, 2021.

Oren Frank, Co-founder and CEO of Talkspace, said, “We continued to experience broad-based momentum throughout our business in the second quarter, driven by significant demand tailwinds and a generational shift to virtual care. Our differentiated and comprehensive product portfolio continues to resonate in the marketplace, and we are seeing traction in both expanding our offering within existing clients as well as adding new clients. We are ideally positioned to address the vast, unmet and growing demand for mental health services in innovative ways, and we are excited to keep executing on our strategy.”

Second Quarter 2021 Financial Highlights

The following table summarizes the Company’s performance during the second quarter of 2021, compared to the same period in 2020:

 Three Months Ended June 30,   Period-Over-Period
(amounts in thousands, except percentages) 2021     2020     Change
Number of B2B eligible lives at period end   56,039.0       33,560.5     67.0%  
Total number of active members at period end   61.5       43.5     41.5%  
Net revenue $ 30,983     $ 17,877     73.3%  
Gross profit   19,286       12,307     56.7%  
Gross margin % 62.2%     68.8%     (660) basis points
Operating expenses   46,847       12,948     261.8%  
Net loss   30,441       646     *
Adjusted EBITDA (1) $ (11,872 )   $ (291 )   *

* - not meaningful
(1) Adjusted EBITDA is a non-GAAP financial measure. Refer to “Reconciliation of Non-GAAP Results to GAAP Results” table below.

Outlook for Third Quarter 2021 and Full Fiscal Year 2021

The Company is reaffirming its net revenue guidance of $125 million for the full year ending December 31, 2021. The Company’s outlook for net revenue is $32 million for the third quarter ending September 30, 2021.

Conference Call Details

The Company will host a conference call at 5:00 p.m. E.T. to discuss these results and management’s outlook for future financial and operational performance. A live audio webcast will be available online at The conference call can also be accessed by dialing (800) 773-2954 for U.S. participants, or (847) 413-3731 for international participants, and referencing participant code 50201358. A replay of the call will be available via webcast for on-demand listening shortly after the completion of the call, at the same web link, and will remain available for approximately 90 days.

Key Business Metrics        

Active Members: We consider members “active” (i) in the case of our B2C members, commencing on the date such member initiates contact with a provider on our platform until the term of their monthly, quarterly or bi-annual subscription plan expires, unless terminated early, and (ii) in the case of our B2B members, if such members have engaged on our platform during the preceding 25 days, such as sending a text, video or audio message to, or participating in a video call with, a provider, completing a satisfaction or progress report survey or signing up for our platform.

B2B Eligible Lives: We consider B2B lives “eligible” if such persons are eligible to receive treatment on the Talkspace platform, in the case of its enterprise clients, for free when their employer is under an active contract with Talkspace, or, in the case of health plan clients, at an agreed upon reimbursement rate through insurance under an employee assistance program or other network behavioral health paid benefit program.

About Talkspace

Talkspace is a leading virtual behavioral healthcare company enabled by a purpose-built technology platform. As a digital healthcare company, all care is delivered through an easy-to-use and fully encrypted web and mobile platform, consistent with HIPAA and other state regulatory requirements.

Today, the need for care feels more urgent than ever. When seeking treatment, whether it's psychiatry or adolescent, individual or couples therapy, Talkspace offers treatment options for almost every need. With Talkspace, members can send their dedicated therapists text, video, and voice messages anytime, from anywhere, and engage in live video sessions. As of June 2021, over 2 million people have used Talkspace, and over 55 million lives were covered for Talkspace through insurance and employee assistance programs or other network behavioral health paid benefit programs.

For more information about Talkspace commercial relationships, visit To learn more about online therapy, please visit

Forward Looking Statements

This press release contains certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, as amended. All statements contained in this press release that do not relate to matters of historical fact should be considered forward-looking, including statements regarding our financial condition, anticipated financial performance, business strategy and plans, market opportunity and expansion and objectives of our management for future operations. These forward-looking statements generally are identified by the words “anticipate,” “believe,” “contemplate,” “continue,” “could,” “estimate,” “expect,” “forecast”, “future”, “intend,” “may,” “might”, “opportunity”, “plan,” “possible”, “potential,” “predict,” “project,” “should,” “strategy”, “strive”, “target,” “will,” or “would”, the negative of these words or other similar terms or expressions. The absence of these words does not mean that a statement is not forward-looking. Forward-looking statements are predictions, projections and other statements about future events that are based on current expectations and assumptions and, as a result, are subject to risks and uncertainties. Many important factors could cause actual future events to differ materially from the forward-looking statements in this press release, including but not limited to: our history of losses; the rapid evolution of our business and the markets in which we operate; our ability to continue growing at the rates we have historically grown, or at all; the development of the virtual behavioral health market; COVID-19 and its impact on business and economic conditions; competition in our industry; and our relationships with affiliated professional entities to provide physician and other professional services. The foregoing list of factors is not exhaustive. You should carefully consider the foregoing factors and the other risks and uncertainties described in under the caption “Risk Factors” in our prospectus dated July 12, 2021 (File No. 333-257686), as filed with the Securities and Exchange Commission (“SEC”) pursuant to Rule 424(b)(4) under the Securities Act of 1933, as amended, our Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2021 to be filed with the SEC, and our other documents filed from time to time with the SEC. These filings identify and address other important risks and uncertainties that could cause actual events and results to differ materially from those contained in the forward-looking statements. Forward-looking statements speak only as of the date they are made. Readers are cautioned not to put undue reliance on forward-looking statements, and we assumes no obligation and do not intend to update or revise these forward-looking statements, whether as a result of new information, future events, or otherwise. We do not give any assurance that we will achieve our expectations.


‍For Investors:
Westwicke, an ICR Company
Bob East / Asher Dewhurst / Jordan Kohnstam

For Media:
John Kim

Talkspace, Inc.
Condensed Consolidated Statements of Loss

    Three months ended
June 30,
    Variance     Six months ended
June 30,
    2021     2020     $     %     2021     2020     $     %  
    ($ in thousands)     ($ in thousands)  
Revenues   $ 30,983     $ 17,877     $ 13,106       73.3     $ 58,140     $ 28,997     $ 29,143       100.5  
Cost of revenues     11,697       5,570       6,127       110.0       21,511       10,980       10,531       95.9  
Gross profit     19,286       12,307       6,979       56.7       36,629       18,017       18,612       103.3  
Operating expenses:                                                
Research and development, net     4,781       2,400       2,381       99.2       7,745       5,128       2,617       51.0  
Clinical operations     1,913       759       1,154       152.0       3,990       1,636       2,354       143.9  
Sales and marketing     26,443       8,442       18,001       213.2       48,694       17,360       31,334       180.5  
General and administrative     13,710       1,347       12,363       917.8       16,318       2,461       13,857       563.1  
Total operating expenses     46,847       12,948       33,899       261.8       76,747       26,585       50,162       188.7  
Operating loss     27,561       641       26,920     *       40,118       8,568       31,550       368.2  
Financial expenses (income), net     2,870       (1 )     2,871     *       3,043       (31 )     3,074     *  
Loss before taxes on income     30,431       640       29,791     *       43,161       8,537       34,624       405.6  
Taxes on income     10       6       4       66.7       18       9       9       100.0  
Net loss   $ 30,441     $ 646     $ 29,795     *     $ 43,179     $ 8,546     $ 34,633       405.3  

* = not meaningful


Talkspace, Inc.
Condensed Consolidated Balance Sheets

    June 30, 2021     December 31, 2020  
Cash and cash equivalents   $ 248,173     $ 13,248  
Accounts receivable     6,617       5,914  
Other current assets     4,318       1,515  
Total current assets     259,108       20,677  
Property and equipment, net     549       175  
Deferred issuance costs     -       692  
Intangible assets, net     4,315       5,195  
Goodwill     6,134       6,134  
Other long-term assets     98       -  
Total assets   $ 270,204     $ 32,873  
Accounts payable   $ 11,759     $ 7,901  
Deferred revenues     7,549       5,172  
Accrued expenses and other current liabilities     9,640       7,416  
Total current liabilities     28,948       20,489  
Warrant liabilities     38,897       -  
Other long-term liabilities     98       -  
Total liabilities     67,943       20,489  
Convertible preferred stock     -       111,282  
Common stock     15       1  
Additional paid-in capital     354,213       9,889  
Accumulated deficit     (151,967 )     (108,788 )
Total stockholders’ deficit     202,261       (98,898 )
Total liabilities, convertible preferred stock and stockholders’ deficit   $ 270,204     $ 32,873  

Talkspace, Inc.
Condensed Consolidated Statements of Cash Flows

    Six months ended
June 30,
    2021     2020  
Cash flows from operating activities:            
Net loss   $ (43,179 )   $ (8,546 )
Adjustments to reconcile net loss to net cash used in operating activities:            
Depreciation and amortization     955       36  
Amortization of debt issuance cost     175        
Stock-based compensation     16,709       733  
Change in fair value of warrants     3,043        
Increase in accounts receivable     (703 )     (785 )
Increase in other current assets     (1,784 )     (556 )
Increase (decrease) in accounts payable     4,833       (326 )
Increase in deferred revenues     2,377       2,068  
Decrease in accrued expenses and other current liabilities     (213 )     (286 )
Net cash used in operating activities     (17,787 )     (7,662 )
Cash flows from investing activities:            
Purchase of property and equipment     (449 )     (9 )
Net cash used in investing activities     (449 )     (9 )
Cash flows from financing activities:            
Proceeds from reverse capitalization, net of transaction costs     251,325        
Proceeds from borrowings     6,000        
Repayment of borrowings     (6,000 )      
Payment of debt issuance costs     (50 )      
Proceeds from exercise of stock options     1,886       62  
Net cash provided by financing activities     253,161       62  
Change in cash and cash equivalents     234,925       (7,609 )
Cash and cash equivalents at the beginning of the period     13,248       39,632  
Cash and cash equivalents at the end of the period   $ 248,173     $ 32,023  

Non-GAAP Financial Measures

In addition to our financial results determined in accordance with GAAP, we believe adjusted EBITDA, a non-GAAP measure, is useful in evaluating our operating performance. We use adjusted EBITDA to evaluate our ongoing operations and for internal planning and forecasting purposes. We believe that this non-GAAP financial measure, when taken together with the corresponding GAAP financial measures, provides meaningful supplemental information regarding our performance by excluding certain items that may not be indicative of our business, results of operations or outlook. We believe that the use of adjusted EBITDA is helpful to our investors as it is a metric used by management in assessing the health of our business and our operating performance. However, non-GAAP financial information is presented for supplemental informational purposes only, has limitations as an analytical tool and should not be considered in isolation or as a substitute for financial information presented in accordance with GAAP. In addition, other companies, including companies in our industry, may calculate similarly titled non-GAAP measures differently or may use other measures to evaluate their performance, all of which could reduce the usefulness of our non-GAAP financial measure as a tool for comparison. A reconciliation is provided below for this non-GAAP financial measure to net loss, the most directly comparable financial measure stated in accordance with GAAP. Investors are encouraged to review our GAAP financial measure and the reconciliation of our non-GAAP financial measure to its most directly comparable GAAP financial measure, and not to rely on any single financial measure to evaluate our business.

Adjusted EBITDA

Adjusted EBITDA is a key performance measure that our management uses to assess our operating performance. Because adjusted EBITDA facilitates internal comparisons of our historical operating performance on a more consistent basis, we use this measure for business planning purposes and in evaluating acquisition opportunities. 

We calculate adjusted EBITDA as net loss adjusted to exclude (i) interest and other expenses (income), net, (ii) tax benefit and expense, (iii) depreciation and amortization (iv) stock-based compensation expense and (v) business combination and other financing expenses.

Talkspace, Inc.
Reconciliation of Non-GAAP Results to GAAP Results

    Three months ended
June 30,
    Six months ended
June 30,
(in thousands)   2021     2020     2021     2020  
Net loss   $ (30,441 )   $ (646 )   $ (43,179 )   $ (8,546 )
Depreciation and amortization     493       18       955       36  
Financial expense (income), net (1)     2,870       (1 )     3,043       (31 )
Taxes on income     10       6       18       9  
Stock-based compensation     15,196       332       16,709       733  
Adjusted EBITDA   $ (11,872 )   $ (291 )   $ (22,454 )   $ (7,799 )

(1) For the three months ended June 30, 2021, financial expense, net primarily consisted of $4.0 million in warrant issuance costs in connection with the close of the Business Combination, partially offset by $1.4 million in gains resulting from the revaluation of warrant liabilities. For the six months ended June 30, 2021, financial expense, net primarily consisted of $4.0 million in warrant issuance costs in connection with the close of the Business Combination, partially offset by $1.2 million in gains resulting from the revaluation of warrant liabilities.

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Source: Talkspace