Amwell Reports Q1 Revenue Decline but Sees Strong Renewals and AI Progress

Amwell, a leading telehealth platform formerly known as American Well, reported first-quarter revenue of $54.9 million, marking an 18% decline from the same period in 2025. Despite this drop, executives highlighted positive developments in subscription renewals and artificial intelligence (AI) during their earnings call on May 5.

Chief Financial Officer Mark Hirschhorn noted that subscription software revenue, which accounted for 53% of total Q1 revenue at $24.9 million, was down approximately 23% year-over-year. However, Amwell's focus on subscription-based models is part of a strategic shift aimed at stabilizing and growing its core business.

“Encouragingly, renewals and retention were higher than budgeted in the first quarter, providing greater confidence in the stability of our subscription base going forward,” Hirschhorn stated during the call. This positive trend in renewals and retention is a crucial indicator for Amwell's long-term sustainability, especially as it navigates a competitive telehealth market.

Strategic Adjustments and Financial Performance

Amwell's visit volume decreased by about 19% year-over-year to 1.1 million visits in Q1. Hirschhorn attributed this decline to portfolio changes previously disclosed by the company. The reduction in visit volume, however, did not significantly impact Amwell's financial metrics as adjusted EBITDA improved from a negative $12.2 million in Q1 2025 to a negative $3.1 million in the latest quarter.

The net loss for Q1 was $10.3 million, a significant improvement from the $25.2 million net loss reported in the fourth quarter of 2025. These financial improvements are part of Amwell's broader strategy to achieve positive cash flow from operations by the fourth quarter of 2026.

Amwell Chairman and CEO Ido Schoenberg, M.D., expressed confidence in the company’s financial trajectory: "We have ample cash, no debt, and a clear path to cash flow breakeven in Q4 with real confidence in multiyear growth beyond it."

In recent years, Amwell has divested non-core assets to sharpen its focus on its core telehealth platform. Notably, in January 2025, the company sold its Amwell Psychiatric Care business to Avel eCare, a move that allowed Amwell to concentrate on fulfilling the unmet needs of payer and provider customers.

Investment Implications

Entering 2026, Amwell's main focus is consolidating its platform to better serve payer and provider clients. Dr. Schoenberg emphasized that the company's technology-enabled care infrastructure is well-positioned to address these needs: "The technology-enabled care infrastructure we have built is robust and scalable, and it will be a key driver of our growth in the coming years."

Investors should watch for continued improvements in subscription renewals and retention rates, as these metrics are critical indicators of Amwell's ability to maintain and grow its customer base. Additionally, the company’s progress in integrating AI into its telehealth solutions could provide a competitive edge in an increasingly technology-driven healthcare landscape.

Amwell's strategic adjustments and financial improvements suggest that the company is on track to achieve its goal of positive cash flow from operations by the end of 2026. While the Q1 revenue decline is a concern, the strong renewal rates and improved EBITDA provide a solid foundation for future growth.