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Mala Murthy

Thank you, Chuck, and good afternoon, everyone. First-quarter consolidated revenue was $629.4 million, down 3% year-over-year and at the high end of the guidance range. Adjusted EBITDA of $58.1 million was near the high end of the guidance range and represented a margin of 9.2%. Consolidated net loss per share was $0.53 compared to a net loss per share of $0.49 in the first quarter of 2024.
The net loss per share included a noncash goodwill impairment charge of $0.34 per share pretax, which occurs after the issuance of our prior guidance and was not included. Excluding this charge, net loss per share in the quarter would have been near the upper end of our guidance range.
As discussed in our 10-K, the Integrated Care reporting unit's fair value was below its carrying value based on the results of our animal goodwill impairment test in the fourth quarter of 2024 and continued to be at the time of the Catapult acquisition. As a result, any goodwill recorded in the Integrated Care segment could require immediate impairment.
Net loss per share also included amortization of intangibles of $0.48 per share pretax and stock-based compensation expense of $0.14 per share pretax. These items were partially offset by a discrete tax benefit related to an R&D tax credit of $0.12 per share. First-quarter free cash flow was a net outflow of $16 million, an improvement of $11 million versus the prior year period. We ended the quarter with nearly $1.2 billion in cash and cash equivalents on the balance sheet.
Turning to our segment results. Integrated Care segment revenue of $389.5 million increased 3.3% over the prior year period and exceeded the top end of our guidance range. Factors that contributed to the upside versus the guidance range included timing shifts related to favorable performance on risk-based deals in Chronic Care as well as FX.
Growth over the prior year was driven by visit revenue, international and our Chronic Care business as well as the additional Catapult, which contributed approximately 90 basis points to segment growth. U.S. Integrated Care segment membership at quarter end was 102.5 million members, above the high end of our guidance range and up 12% year-over-year while U.S. virtual visit volume increased by 7%. Chronic Care ended the quarter with total program enrollment of 1.15 million, up approximately 3% year-over-year as enrollment gains from existing and new clients were partially offset by the slightly higher [attrition] that we have previously discussed.
Our Integrated Care segment continues to show strong momentum internationally with related revenue growth in the mid-teens on a constant-currency basis. First quarter Integrated Care adjusted EBITDA was $50.4 million, a 6% increase over the first quarter of 2024. Adjusted EBITDA margin of 12.9% was up approximately 30 basis points year-over-year and above our guidance range of 11.25% to 12.75%. Driven by flow-through from the revenue upside from performance on our risk-based deals, partially offset by a pull forward of paid media spend as we continually seek to optimize spend throughout the year.
Turning to the BetterHelp segment. First-quarter revenue of $239.9 million was down 11% versus the prior year and above the midpoint of our guidance range. In the quarter, we continued to see improved stability in average paying users, which declined by less than 1% sequentially while total users at March month-end, exceeded that of December.
Overall, customer acquisition costs have remained relatively stable since our prior update, and retention rates were generally consistent with the fourth quarter. Over the next several years, we believe the unification of the customer acquisition funnel between cash pay and benefit coverage will allow us to leverage BetterHelp's marketing budget more effectively, resulting in a lower acquisition cost per user. BetterHelp adjusted EBITDA were $7.7 million in the first quarter versus $15.5 million in the prior year period. Adjusted EBITDA margin was 3.2% compared to 5.7% in the prior year.
Now let me turn to guidance. For full-year 2025, we expect consolidated revenue of $2.047 billion to $2.058 billion, which is unchanged versus our prior outlook. We now expect adjusted EBITDA in the range of $263 million to $304 million and full-year free cash flow of $170 million to $200 million, both of which have been updated to reflect the impact of the UpLift acquisition, which I will discuss in a moment.
Stock-based compensation expense is now expected to be in the range of $105 million to $115 million, approximately $15 million below our prior estimate. For the second quarter, we expect consolidated revenue in the range of $614 million to $633 million and adjusted EBITDA in the range of $56 million to $70 million, which includes the UpLift acquisition.
Moving to the segments. For Integrated Care, we are maintaining our full-year 2025 revenue guidance of flat to up 3% year-over-year. We continue to expect Catapult to contribute roughly 200 basis points to full-year revenue growth. Our full-year 2025 adjusted EBITDA margin guidance of 14.3% to 15.3% is unchanged. And as previously discussed, includes a roughly 40 basis point headwind from the Catapult acquisition.
Excluding Catapult, adjusted EBITDA margin would be roughly flat year-over-year at the midpoint of the guidance range. We are also confirming our full-year member guidance range of 101 million to 103 million members. Importantly, given the fluidity of the situation, we have not included the impact of announced tariffs in our current guidance. However, we feel that it is important to size the potential impact to the current year.
Based on the start date, current rates by country, including the 145% China tariffs and our mitigation efforts, which includes the amount of inventory on hand, we estimate a potential $5 million to $10 million headwind to adjusted EBITDA in 2025, largely in the second half. We will continue to monitor developments and explore additional mitigation opportunities.
For the second quarter, we expect Integrated Care segment revenue growth of 0.25% to 2.75% and adjusted EBITDA margin between 13.25% and 14.75%. This includes a full quarter of contribution for Catapult which is expected to add approximately 240 basis points to growth as well as a sequential decline in Chronic Care program enrollment in the second quarter due to the previously discussed contract loss.
Importantly, we expect sequential growth in Chronic Care enrollment to resume in the third quarter, driven in part by growth from our new weight management contract with one of our largest customers. Also, recall that our adjusted EBITDA margin in the second quarter of 2024 included a roughly 340 basis points tailwind due to several discrete factors, including performance-based revenue, compensation accruals, and the timing of certain marketing and operating expenses.
Moving to BetterHelp. I wanted to start by providing some additional color on uplift. Echoing Chuck's thoughts, I'm very excited about the transaction and believe it has the opportunity to advance our strategic priorities and drive a material improvement in segment performance over time. In terms of background, we have acquired UpLift for $30 million in cash with up to $15 million in additional contingent NAV considerations based on certain performance-related milestones. UpLift generated approximately $15 million in revenue in 2024 and completed approximately 114,000 sessions. Adjusted EBITDA was a loss of roughly $6 million which reflected investments to build out the operating infrastructure.
With that as a starting point, let me provide some additional detail on several factors. First, we believe that access to benefits coverage will lead to significantly higher conversion rates relative to BetterHelp's cash pay business, driven by greater affordability as prospective users would incur relatively low or potentially no out-of-pocket costs to access mental health care based on their particular business. Next, we expect increased member duration relative to the current BetterHelp model as many cash users that pause subscriptions site cost as a primary factor.
For covered benefits, we initially assume that sessions per user will be 30% above that of cash pay, which is conservatively below UpLift historical utilization rates. As we progress through the remainder of 2025, we will advance business plans at an appropriate pace with increased scaling over time. This means that for users coming through the BetterHelp platform, we will enable access to insurance benefits coverage in a staged manner. As we scale uplifts operations, including the provider network to ensure access and a high-quality consumer experience. Therefore, we expect a ramp in revenue contribution from benefits coverage as we enable more access over the next 6 to 12 months.
Consistent with others accepting benefit coverage, we expect gross margins for therapy covered by insurance benefits to be lower than that of the cash pay business. With our results, to reflect the shift in mix over time. We expect this mix shift to be driven by new users accessing benefits coverage as well as the potential shift of a portion of existing BetterHelp cash pay users to in-network arrangements.
However, we expect higher conversion rates to lead to an increase in users and visit volumes and higher gross profit dollars should more than offset the lower gross margin profile for benefits coverage. We expect to achieve this increase by leveraging existing advertising and marketing spend and activation expertise.
Given consumer demand and preferences and our market-leading position, we do expect to maintain a sizable direct-to-consumer cash pay business at BetterHelp which will include users without benefits coverage, those with a health plan that is not in our network and also users who prefer a direct-pay arrangement. And as a reminder, BetterHelp's international business is cash pay and our BetterSleep consumer offering with cash pay today as well.
In terms of how this translates to our outlook, we anticipate approximately $10 million of incremental benefits-coverage related revenue in 2025, net of any shift from the existing cash pay business. We expect a more material revenue contribution in 2026 as we continue to methodically scale operations and the therapist network to meet demand and enable access returning the BetterHelp segment to a growth trajectory. These estimates will be further refined as we progress through the year and move into 2026.
To support the scaling of the insurance business, we expect additional OpEx investments in areas such as provider recruitment, credentialing, support functions, and technology. These investments combined with some dilution from the legacy UpLift business are expected to lead to an incremental headwind of approximately $10 million to $15 million to 2025 adjusted EBITDA for the BetterHelp segment and overall.
Moving to our updated outlook for BetterHelp. We continue to expect full-year 2025 revenue to decline 3.75% to 9.75% versus 2024, which includes the incremental contribution from benefits coverage. And reflects updated views on the cash pay business with recent softening consumer sentiment and increasingly uncertain macroeconomic factor.
Demand for mental health services remained resilient in the first quarter as we delivered revenues in the upper half of our guidance range. Having said that, we observed a slight uptick in churn rates more recently, something we are monitoring closely and factoring into our guidance range. However, providing customers with the ability to access benefits coverage can help to ease this risk over time.
For adjusted EBITDA margin, we now expect a range of 4.75% to 6.25% for the full year, which is down 150 basis points versus our prior outlook and includes the impact of the UpLift acquisition and increased investments to support the insurance business. For the second quarter, we are guiding to BetterHelp segment revenue to be down 7.5% to 11.25% year-over-year, with the midpoint reflecting modest sequential revenue improvement over the first quarter.
We expect an adjusted EBITDA margin of 2.5% to 5.25% for the second quarter, both reflect UpLift from the closing date forward. Lastly, from a balance sheet standpoint, we continue to have a high degree of financial flexibility with nearly $1.2 billion in cash and cash equivalents on the balance sheet as of the end of the first quarter.
Our 2025 convertible bond comes due in June, which we will retire with cash on hand and maturity. We continue to evaluate our long-term financing although we believe our strong cash position, cash flow generation, and business position provides us with optionality in the future.
With that, I will turn the call back to Chuck.

Charles Divita

Thanks, Mala. Before we open it up for your questions, I wanted to highlight some exciting recognition we recently received. Teladoc was named to Newsweek's Most Trustworthy Companies in America for 2025 and ranked number one in the healthcare and life sciences industry. We were also included in USA TODAY's inaugural list of America's Most Trusted Brands and one of just five companies to earn a Top 5 star rating in the pharmacies, health, and wellness category. We are honored to be recognized for the trust we earn from members, clients, and partners, and I could not be more proud of the entire team and their commitment to integrity and excellence.
With that, we will open it up for questions. Operator?

Question and Answer Session

Operator

(Operator Instructions)
Jessica Tassan, Piper Sandler.

Jessica Tassan

Hi, guys. Thanks for taking the questions and congratulations on the acquisition and bringing behavioral health in network or expanding that offering.
I'm wondering if you guys can talk a little bit about the shorter duration contracts that were made available in BetterHelp, I think in the fourth quarter, so like weekly billing. It doesn't look like that had too much of a corrosive impact on average PMPMs in the first quarter which is good. But just if you could speak a little bit to the impact of that offering on churn and then the expectations embedded in the next three quarters as well that would be helpful.
And then just a quick follow-up would be, have you done any evaluation or assessment as to why the core BetterHelp network was not able to ultimately get payer coverage and upfront obviously was just kind of any distinctions you want to make on the two different networks.

Mala Murthy

Thank you, Jessica. I'll start with your first question. So I'll take them in order. So we have been talking about the weekly offering now for several months. Just to recap the activities we've had there, we started essentially in September with the weekly offer. Prior to that, our BetterHelp offering was only a monthly subscription.
What we did do then is to start this weekly offer with a price point that is essentially one-fourth of the monthly subscription price point. So we didn't really do any kind of discounting. We have essentially taken that price point and priced it at one-fourth of that.
What we are seeing, and I will say a lot of our acquisitions now is around the weekly offer versus the monthly offer. The trends that we have been seeing over the past several months is as follows: First, because the weekly offer is at a more accessible price point, unsurprisingly, we're actually seeing stronger conversion, I would say, much stronger conversion. The second, though, is because the user is reminded on a weekly basis, we are also seeing higher churn, both of which we expected.
What is important though is that net of the two, it is still positive, okay? So what we are essentially seeing is it is it is still net positive relative to the monthly offer. And we are continuing to evaluate how the LTV plays out over time. LTV, as you know, is something that we measure and watch over time. So we are essentially seeing that the metrics that we are looking at remain stable. We are pleased with what we are seeing and we will continue to assess and evaluate.
The one thing I would also say is we have to be careful about when we think about the revenue per member, if you will, the revenue per user because we are acquiring these customers at that lower weekly price point, you will see an impact quite naturally on the revenue per member. But remember, we are also getting a lot more members -- a lot more users. So those are essentially the trends that we are seeing.
Chuck, do you want to comment on the second question?

Charles Divita

Yes. I would just -- as a reminder, what we talked about getting into the benefit coverage space, really through the end of the year, our focus was on the technical capabilities around that. And the team have made really good progress. And as we had shared in the last call, we were ready operationally to do that.
We had hired talent, and we were going after -- and still are going after payer contracts that really started in earnest in the first quarter. We applied to over a dozen payers in terms of getting in network coverage and had a couple that were at the finish line when the UpLift transaction started to really gain momentum, and we paused things there with those payers. So we didn't send mixed signals and felt like this was a way to accelerate what we're doing.
So it wasn't about the BetterHelp network itself, it's about this is an opportunity to accelerate. We have over 35,000 therapists in the network, and we have extensive -- we believe there's extensive numbers in there that would be interested and meet the requirements for payer coverage, and that's what we're going to activate over time. So again, I think the sequencing was, as I just mentioned, and we're excited about this opportunity.

Jessica Tassan

Awesome. Thank you.

Operator

David Roman, Goldman Sachs.

Mala Murthy

David, we can't hear you.

David Roman

Can you hear me now?

Mala Murthy

Yes.

David Roman

Sorry about that. I just wanted to come back to the BetterHelp business here a little bit -- the member trends actually improved quite a bit. You mentioned Q1 versus Q4 down very marginally sequentially. But if you look at the revenue numbers, you're seeing a pretty significant decline either in PMPM or revenue per member.
Can you maybe help us understand the declines that you're seeing both in the integrated care business. I think you noted an 8% decline in revenue per member there and obviously, the down 4% on members in BetterHelp compared to the down 11% in revenue. Maybe help us bridge that gap.

Mala Murthy

Yes. So on the Integrated Care side, yes, what we did see is the decline that we spoke of on a year-over-year basis on revenue per member. However, remember, that what that is showing is a very significant increase in number of members. We also reported a 12% increase in members on a year-over-year basis, David, over 8 million members.
So if you just think about what that means, you're onboarding a big cohort of members, and that is essentially in the ratio. We haven't really had time yet to sell into that member population all of the more revenue accretive services that we offer such as chronic care, et cetera.
So what you see here is they typically will come in. So take TRICARE is a great example, right? We onboarded 9 million members essentially starting the beginning of the year. So what you will see is them coming in with essentially core telehealth services. Over time, we will have an opportunity to cross-sell and upsell to them additional products and services.
So that dynamic is essentially what is causing a depression in the year-over-year metric. I will say, if you were to look at it on a, think of it on a same-store sales basis, you would actually see a slight increase in our revenue per member on the integrated care side. And the fact that we are adding all of these members is a perfect opportunity for us to actually put in action or land and expand, right? We have landed these members and now is an opportunity for us to expand into additional products and services, which will happen over time. So that's on the Integrated Care side.
On the BetterHelp side, what I would say is the fact that you're seeing the revenue per user as you are is a combination of a few things. First is we have said in terms of our priorities, international growth is certainly an area of focus for us in BetterHelp. And we have said that international revenue per user is lower than in the U.S.
Now keep in mind that in international, the cost of acquisition is also lower. So from a margin perspective, it's slightly lower than the U.S. on net margin, but only slightly lower. But certainly, if you look at the headline revenue per user, it is lower. So you are partly seeing a mix effect if you look at the revenue per user. So that is one dynamic. And then the other dynamic that you're seeing is what I spoke about a few minutes ago about the weekly price.
We are acquiring users at a price point that is lower, but we are also acquiring more users, it's just though that we will be able to, over time, I would say that as our acquisition efforts become more efficient, and we are able to use our advertising spend to actually be more efficient and effective that should essentially result in greater revenue growth over time.

David Roman

That's very helpful perspective. Thank you for the detail. Maybe just a follow-up on that.
As you think strategically, I think one of the themes, Chuck, that you've talked about over the past year is increasing the profitability per member and really focusing in on profitable member growth. How do you kind of contrast that with sort of the continued focus on member growth, the dilutive impact of that? Are you sure you're being focused enough in the strategy here? And maybe any color you can give us on what, in your mind, the signpost that you're watching to give you confidence that you can really return this business to growth?

Charles Divita

Are you speaking about members on the BetterHelp side? Or are you talking about the Integrated Care side?

David Roman

I don't have a total -- obviously, there's a focus on BetterHelp there, but you're still talking about 8% growth in the Integrated Care side. You have over 100 million members, that's a giant number. How do you make sure you're extracting the value there. So we're still not seeing total company revenue turn in any meaningful way.
So as you think about the strategic changes you're making and the acquisitions, how does this all fit together for you? And what are the signposts in Washington to give you confidence that you can get this company back to revenue and EBITDA growth?

Charles Divita

Yes. Okay. Got it. I just want to make sure I was clear on the question.
So a couple of things are in play here. First of all, the growth in customers, growth in members will translate into growth in usage of services and as our business and the Integrated Care side, we see more movement from subscription-based models to visit-fee-based models. That membership and the activation of that membership to visits is how you get paid. That is the revenue generation. So the growth is important there as well. And why, I talked about this a couple of quarters ago, but why it's such a priority for us to make our visits more valuable.
What do I mean by that? As that mix shift changes, we need those visits to -- we need the activation. We need to do a great job for our customers, great job for our members to have the visit, and we need those visits to be able to do more services on behalf of our customers. So that's why we are putting the technology in place that I mentioned in my prepared remarks, that allow us to activate and take the next best action for that member. All of that is underlying the importance of that in terms of how we're going to see growth.
So I think the headline metric of revenues divided by members, I think, has historically made some sense. But I think if that business is evolving, and I would just highlight that. So that's one. Second, I've talked about the need to make our Chronic Care management programs and use our clinical strength and product breadth to drive more value. Well, what do I mean by that?
We have over 1 million people that we serve, a massive number of people that we serve in Chronic Care. These are people with diabetes, hypertension, with weight and obesity issues. And so we're doing a great job in terms of engaging with those members, helping them with their conditions, et cetera. We have a further opportunity to drive more, I would say, outcomes with respect to cost of care, which is a major issue that our health plan customers are facing and our employer customers are facing. And so that's where a lot of the innovation and the product road map is headed which is how do we take those programs to the next level.
It's those things that are going to drive the future growth of the company, both from a top line as well as from a user perspective. So hopefully, that's some additional color for you.

Mala Murthy

David, one other thing I would add is on the BetterHelp side, we have for a while now, been talking about balancing top and bottom-line growth. We are managing our return on ad spend such that we are more chasing unprofitable revenue. One thing I would add, as we thought about the rationale, the strategic rationale for the UpLift acquisition, is the fact that if you think about the enormous funnel that BetterHelp has with its scale and that scale and the funnel is supported by the advertising and marketing spend that we have in the BetterHelp business. You're talking about close to 4 million users at the top of the funnel who are essentially interested in at least looking into a BetterHelp service, right?
Now the fact is as they go through the funnel and they come to a cash pay option, many of them choose not to avail themselves of the service. So you think about the conversion factor for the amount of ad spend we have, we now, with offering the covered benefits auction with UpLift are allowed -- are essentially leveraging our ad spend to capture some of those, hopefully, many of those users over time with the insurance option. So it actually allows us to capture more users through that funnel, leverage our ad spend in a much more effective way, and that should help not only top line growth, but that should also translate to bottom-line growth.

Operator

Daniel Grosslight, Citi.

Daniel Grosslight

Thanks for taking the question. I was hoping to get a little bit more detail on the cadence of BetterHelp margin improvement in the back half of the year. Guidance implies nearly $20 million or so improvement from one half to second half and you noted that there's around, I think you mentioned $10 million to $15 million of additional costs due to UpLift and some additional investments you're making in the insured product. So can you help us think through 3Q and 4Q as those two dynamics play out?

Mala Murthy

Yes. So the way I would think about the dynamic playing out is the following [Daniel] and you know that the BetterHelp business is essentially largely a variable margin business. There is a relatively low amount of fixed cost. We do, as we said, have investments proposed for the integration and just getting a quick start on realizing the strategy that we have with the UpLift acquisition.
Having said that, what I would say is the following. Think of the ramp for the second half to be driven by a few things. One is, if you think about revenue, we will continue to advance on revenue growth as we go to the second half on the back of all of the priorities for the BetterHelp business that we have already talked about, including insurance -- I'm sorry, including international.
We are continuing to make progress on our international efforts, both English-speaking company as well as the localized market launches that we are in process. We've done France. We are doing Germany and Netherlands next. So we are making progress on advancing those international priorities. So the second half ramp is essentially conditioned on the revenue from those efforts.
And then we are also, as we talked about, looking to advance the insurance efforts in the second half. The last thing is, as always, we have talked about pulling back on ad spend in the fourth quarter, and we will do so again this year just like we have done in prior years. I will say I do expect the ad spend in the fourth quarter of this year to be slightly sequentially greater from a pullback standpoint relative to last year.
Last year, if you remember, we had very, very little pullback in ad spend in the fourth quarter. I do expect it to be a little bit more pronounced this year. And those are essentially the various factors playing into the second half.

Daniel Grosslight

Got it. okay. And then on the UpLift pricing model, is that subscription-based and visit based? Or is it based only. And can you talk a little bit about how that may integrate with the mental health solution on the Integrated Care side of things?

Charles Divita

Yes. This is in network coverage. So they'll be -- it's visit based, it's not subscription based. So that model is there, and we expect as we've seen with others, but also our own experience, more extended usage, more visits because it's covered by insurance. So that's the model there.
The Integrated Care mental health offering, which is quite scaled over 1 million visits a year, it's really an offering that it's somewhat different. It's got a lot of content a lot of different kinds of tools, and it's really sort of sold and integrated with our various other offerings on that side.
We have looked at and moved a bit on some synergies between Integrated Care and BetterHelp, for example, how we were doing some of the sales and go-to-market of the BetterHelp for business offering. There are some products, some joint products that we're exploring right now that we think could be an interesting development for the company. I don't want to speak about that too much now.
So I think that they're somewhat different markets they're serving, different use cases for customers. But again, the macro theme of virtual mental health care being an important priority for Teladoc is what's most important. It's a space that is widely adopted. Post pandemic that had the highest sort of penetration, if you will, in virtual care, that's sustained that. You think about the shortage of access, the unmet mental health needs that are there, both in the U.S. and internationally, obviously.
And so we think from a macro perspective, this is the right space to be in. We're scaled in integrated care. We have massive scale in the consumer business with BetterHelp. We have the most well-recognized brand in BetterHelp funnel of 4 million people registering. That's massively higher than anyone else.
So if we have this opportunity to sort of help those consumers access their benefit coverage with the great experience that they're looking for with BetterHelp. We think it's the right strategic move for us. So different customer bases, but I think broader theme is right on.

Daniel Grosslight

Got it. Thank you.

Operator

Jailendra Singh, Truist.

Hi, guys. Thanks for the question. This is Eduardo on for Jailendra. Can you speak to the -- what you're seeing in terms of CAC trends in BetterHelp business? Is it different on the domestic and international side? I noticed that advertising and marketing spend [ad] is down 130 bps year over year, 50 bps sequentially. So just curious [about] what you're seeing there.

Mala Murthy

Yes. I would characterize the trends that we are seeing as stable through the first quarter of this year. And I would say, Eduardo, we are actually seeing it more favorable relative to the last many quarters for an important reason, because we are seeing good conversion rates from our weekly offer from the acquisitions we are making on our weekly offer, the yield is actually better. So if you just think about why we are seeing favorability in our CAC, it is really because of the acquisitions that we are making on the weekly offer.
So those are essentially the trends that we are seeing. We are not seeing any significant differences, I would say in U.S. versus international. I'd say customer acquisition costs have remained relatively stable thus far in 2025 across the board. So that's sort of what we are factoring into our guidance.
Now one thing I will obviously always caveat is we started in February with a wide range in our guidance for BetterHelp. We are continuing with that wide range for BetterHelp. And part of the reason we have that wide range out there is macros are uncertain. Consumer sentiment is certainly uncertain to softening. And I would say, overall, what we have also learned over the past couple of years is this space can move very dynamically, including in ad costs and ad pricing.
So we have given ourselves room to navigate through these uncertainties as best we can by our guidance range being as wide as it is.

Okay, thanks.

Operator

Elizabeth Anderson, Evercore.

Alan Chen

Hi, thanks for the question. This is Alan Chen on for Elizabeth. I have a question on cost savings. I believe on the 4Q call, you mentioned about increased focus on tech and G&A costs. Can you share more color on how you're thinking about additional opportunities in those areas? Thanks.

Mala Murthy

Yes. So we had talked about the fact that in the February call, we expected the cost savings this year to be modestly higher than what we had originally signaled for 2025. We continue to make efforts. In fact, I would say to you, in the first quarter, we took out a little bit of additional costs than we were expecting earlier in the year. And we have accounted for increased restructuring costs and severance costs as a result of that as we have put out the EPS guide.
Point being, we continue in this uncertain macroeconomic environment. It's prudent for us to think about continuously looking at our cost base and look at streamlining, rationalizing our cost base as appropriate. If you look at the results, we delivered in 1Q, I would say we have demonstrated good control over our overall cost base technology and development spend is down on a year-over-year basis. We have spoken about the fact that we are putting scrutiny on this line item. We expect that to continue. And I would say I would expect overall T&D dollar spend from an OpEx basis to be down in absolute levels year-over-year as we go through this year.
On the G&A side, we did have a couple of -- we had some accruals that we took reserves on. So you will see that in our numbers for the first quarter. But I do expect us to continue to demonstrate restrain and discipline as we go through the year. And as you saw in our prepared remarks, we have brought down our stock-based compensation outlook for the year by $15 million, and it is considerably lower than 2024 and 2023. So again, it's a point of focus for us, and we'll continue to maintain control, exercise control over that.

Alan Chen

Okay, thanks.

Operator

Charles Rhyee, Cowen.

Charles Rhyee

Thanks for taking the question. Yes. I guess, firstly, if we think about sort of the path here with -- I guess I just want to talk about UpLift here, you're paying about 2x revenue, up to 3x depending on the contingent payments into the future. You go back to Catapult, you paid about 2x revenue as well. And I guess both of these bring to you guys some important capabilities certainly with UpLift getting sort of insurance-based coverage here.
But with your stock trading at less than 1x, closer to 0.5x revenue. Can you talk about more about why the Board is not more actively perhaps looking at a share buyback. Understanding you have the converts coming due, you're going to pay down in cash but when you look at overall leverage, it's not that drastic. And you still need a lot of financial capacity as it stands.
Can you talk to me a little bit about your capital deployment strategy at this point? And maybe why share buyback is not a perhaps a bigger part of that?

Mala Murthy

Yes. So it's a very fair question, Charles. Unsurprisingly, this is a point of active discussion amongst the management team internally. And as we think about the various options, we have to deploy our capital. First, we are looking to deploy capital to amass capabilities that we need for us to be able to drive sustained top line growth as we move forward over the next 12 to 36 months.
When Chuck came on board middle of last year, one of the things that we talked about then and since on earnings call is the fact that we are a company looking to reposition and turn around our performance. That takes capital deployment that can be organic, that can be inorganic, as you have seen us use inorganically over the past couple of quarters.
So we are looking to, as we have always done, to look at adding to our capabilities, whether it be services, whether it be other capabilities so that we can drive sustained top line and bottom-line growth in the months and years ahead. So that's number one. Number two, we definitely are looking at our overall leverage and our debt. As we talked about in our prepared remarks, we'll pay down the upcoming note that's due. We are looking at the 2027 note that is outstanding. And we know that it's trading below par, so we are assessing that.
The third, and we have never taken this off the table, we are absolutely looking at buybacks as well. So it's a matter of -- and we have been talking to the Board about all of this. So as a part of normal course of conversations that the leadership team has with the Board. I would say to you none of these is off the table. It's a matter of us at this moment because of looking to accrete to our top line growth and bottom-line growth in the years ahead, there are opportunities that are coming our way.
We are, with the scale we have in this space, we do tend to get a lot of inbound and we look at them in terms of what it will do for our future performance. So the fact that we are going out with Catapult and we have just gone out with the UpLift acquisition is a reflection of the fact that we have these interesting opportunities that we were looking at. And that came to us, and we felt that it was really important for us to move forward with this. Chuck?

Charles Divita

Yes. And just the only thing I would add is we need to invest in those key strategic priorities. Our biggest opportunity as a company and for our shareholders is to leverage this scale position that we have with 100 million lives with this really unparalleled position over 12,000 customers, international business. So we need to invest in those capabilities, they're going to really achieve the outcomes against the scale that's been built.
And on the BetterHelp side, the acquisition I mentioned the two times. This is a company that had invested in their capabilities as a really strong team are limited in terms of their ability to activate. At the end of the day, you need to activate the consumer, make them aware of what you're doing and activate them into your solution. That's what BetterHelp does, BetterHelp us expert at that, massive scale.
So that's how we looked at that acquisition, and we're really excited about the fact that we can accelerate our progress. Obviously, we're going to do it in a measured way, as Mala said, we want to build it for the long term. But it really is an unparalleled opportunity to take something as massively scaled as BetterHelp and to start to bring that consumer orientation and activate with that benefit coverage.
So that's how we're looking at capital. Obviously, all the things that Mala said are on the table. But we also want to make sure we're investing in this business for the future.

Charles Rhyee

And a follow-up question. Can I just ask, so obviously, you talked about getting into the TRICARE population at the start of this year, looking to activate on that side, cross-sell products above the basic sort of telehealth offering to start. You're talking about here BetterHelp here with the UpLift in trying to transition that a little bit away from a direct-to-consumer model.
Can you talk about sort of the capacity internally at the management level to kind of handle these processes because they seem very distinctly different challenges that you're facing that you have been facing over the last year plus. And I guess just to fundamentally get to the question, the strategic value having both of these assets under a single roof here and whether your management attention or resources are being kind of pulled in different directions and perhaps a more focused strategy on one or the other might move things along a lot quicker. Thank you.

Charles Divita

Yes, I think it's a fair question. One of the very first things when I came on board, and we've spoken about this in prior quarters, was that we needed to take it to look at the way we were organized. I think we were organized in a way that we're not as close to the customer as we needed to be, and we've made a number of changes to streamline the organization and focus them on their markets that not only did it save cost, if you will, it improved agility and put the right leadership and management structure in place so that we can activate on each one of these strategies.
So we are organized to execute against this. I feel comfortable that we have the ability to kind of drive those forward. I think the importance of we had these two scaled businesses that are part of Teladoc. It's incumbent upon us to make sure that we're maximizing the value out of those. We need to make sure that BetterHelp is positioned for the future. As we said, we think that's the right thing to do regardless. And I think activating against these strategies on the Integrated Care side are going to yield benefits as well. So it's a fair point, but we feel like we've got it adequately covered.

Operator

We are out of time for questions. So that will conclude today's call. Thank you all for your participation. You may now disconnect your lines.