Healwell is focusing exclusively on artificial intelligence (AI) and data science, as both it and parent company Well Health record record-breaking second-quarter earnings.
The healthtech company’s board announced in its earnings release that it is considering “strategic alternatives” for its clinical research and patient services, aiming to become a “pure-play” software-as-a-service (SaaS) and services firm. Non-binding letters of intent have already been signed to pursue this path.
“This milestone marks a shift in our financial trajectory and validates the scalability of our healthcare software business and AI-driven business model.”
James Lee, CEO
Healwell
BetaKit sought more information from Healwell about this transition, but had not received a response at the time of publication. In the related earnings call, CEO James Lee stated the company was in “very early discussions,” and couldn’t yet detail how the research and patient services shift would impact the company’s margins.
This strategic shift follows a 645-percent year-over-year revenue increase to $40.5 million CAD, largely due to the Orion Health acquisition completed on April 1.
Additionally, the company reported its first quarter of positive adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA), earning $1.9 million, compared to a $3.7 million loss in Q2 of the previous year. Lee commented that this quarter represented a “major inflection point” demonstrating the efficacy of their strategy.
“This milestone marks a shift in our financial trajectory and validates the scalability of our healthcare software business and AI-driven business model,” Lee stated.
Healwell focuses on preventative healthcare, offering software that uses AI and data science to identify chronic and rare diseases early, potentially allowing for more timely diagnoses and treatments. Orion Health provides services to consolidate health data and make it more accessible to patients.
Well Health, which exercised a call option to gain majority control of Healwell on April 1, also posted strong earnings. Its revenue increased 57 percent year-over-year to a quarterly record of $356.7 million, fueled by acquisitions and “organic growth,” according to a release. Its adjusted EBITDA rose 231 percent to $49.7 million, and net income surged 532 percent to $25.8 million.
For the first time, the company recorded over 1 million patient visits in Canada in one quarter, a 38-percent increase compared to the same period in 2024. The average Well Health provider increased their visits by 22 percent.
Both brands highlighted strong revenue growth in Q1, though overall performance was less robust. Well Health saw its net income decrease from $17.2 million in Q1 last year to $7.5 million, partly due to selling software provider Intrahealth to Healwell, which posted a $14-million net loss last quarter, prompting layoffs in February.
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