Financial Data and Key Metrics Changes - Total revenues for Q3 2025 reached $956 million, representing a 100% increase year-over-year and a 46% increase sequentially, driven by the integration of Prospect Health and solid organic growth [7][18] - Adjusted EBITDA for the quarter was $68.5 million, up 52% year-over-year and 42% sequentially, indicating strong profitability during aggressive scaling [7][18] - The company ended the quarter with approximately $462 million in cash and short-term investments, and net debt of approximately $624 million, resulting in a net leverage ratio of about 2.5 times on a pro forma trailing 12-month adjusted EBITDA basis [20][50] Business Line Data and Key Metrics Changes - The care enablement segment saw significant growth, more than doubling revenue quarter-over-quarter due to the addition of new provider group clients from Prospect [18] - Medical cost trends remained stable and well-controlled across both legacy Astrana and Prospect businesses, with Medicare trending favorably below the 4.5% expectation for the year [8][18] Market Data and Key Metrics Changes - The company reiterated synergy targets of $12 to $15 million from the Prospect acquisition, focusing on aligning provider and patient experiences, standardizing operating systems, and implementing the Astrana technology platform [9][20] - The partnership with Intermountain Health in Nevada enhances Astrana's presence in a fast-growing market, combining clinical infrastructure with value-based care management capabilities [12] Company Strategy and Development Direction - The company’s strategy is built on four pillars: smart growth, disciplined risk progression, quality and cost excellence, and operating leverage through technology [6] - The integration of AI across the enterprise is expected to drive improvements in efficiency and care quality, with predictive models identifying high-risk patients for earlier interventions [10][11] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the integration of Prospect and its potential to enhance performance heading into 2026, despite some anticipated headwinds in Medicaid and exchange businesses due to regulatory dynamics [15][16] - The company updated its 2025 revenue guidance to a range of $3.1 to $3.18 billion and adjusted EBITDA to a range of $200 to $210 million, attributing changes to timing rather than underlying performance [14][21] Other Important Information - The company expects to achieve full onboarding of Prospect's physician groups and care teams to the Astrana platform by mid-2026, with cultural integration being a key focus [9][10] - Cash flow from operations for the quarter was approximately $10 million, contributing to a nine-month total of $118 million, with expectations of full-year free cash flow conversion of approximately 40 to 45% of adjusted EBITDA [20] Q&A Session Summary Question: Revenue guidance update related to full-risk transition timing - Management clarified that the delay was strictly a timing issue related to both legacy Astrana and Prospect businesses, ensuring contract standardization across both [22][23] Question: Details on the Intermountain Health partnership - The partnership aims to enhance care coordination and affordability for patients in Southern Nevada, with potential for future expansion into additional states [24] Question: Medicaid cost trends and expectations - Management anticipates Medicaid margins to stabilize by late 2026, with current trends showing improvement [25][26] Question: Margins by segment - The care enablement segment showed high margins due to rapid growth and effective management, while care partners' margins were slightly lower due to higher trends in the legacy Prospect business [27][28] Question: Medical cost trends and expectations for 2026 - The blended weighted average cost trend was just under 4.5%, with expectations for conservative management in light of potential regulatory headwinds [41][42]

Core Insights - Astrana Health reported a remarkable year-on-year revenue growth of 99.7%, reaching $956 million, which exceeded Wall Street's estimates by 0.6% [1][5] - The company has shown strong annualized revenue growth of 47.7% over the last two years, indicating a recent acceleration in demand [1] - Astrana Health's sales have grown at a compounded annual growth rate of 33.3% over the last five years, outperforming the average healthcare company [2] Financial Performance - The company's free cash flow margin decreased to 0.8% from 6.6% in the same quarter last year, and the operating margin fell to 2% from 5.9% [4] - Astrana Health's full-year revenue guidance was lowered to $3.14 billion, which is 1.9% below previous estimates [4] - The GAAP profit for the company was reported at $0.01 per share, significantly below analysts' consensus estimates by 97.6% [5] Profitability Trends - Astrana Health's operating margin has decreased by 14 percentage points over the last five years, indicating rising expenses that could not be passed onto customers [8] - The operating margin for Q3 was 2%, down 3.9 percentage points year on year, reflecting less efficiency due to faster-growing expenses compared to revenue [9] - Earnings per share (EPS) declined by 27.1% annually over the last five years, despite revenue growth, suggesting reduced profitability on a per-share basis [10] Market Expectations - Analysts project a revenue growth of 37.2% over the next 12 months, indicating a slowdown compared to the previous two years but still reflecting confidence in the company's products and services [6] - Wall Street expects Astrana Health's full-year EPS to grow 877% over the next 12 months, despite the current low EPS of $0.01 [12]

Third Quarter 2025 Earnings Supplement November 2025 Forward Looking Statements This presentation contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act and Section 21E of the Exchange Act. Forward-looking statements include any statements about the Company's business, financial condition, operating results, plans, objectives, expectations and intentions, expansion plans, estimates of our total addressable market, our ...

Financial Performance - Total revenue for Q3 2025 reached $956.0 million, a 100% increase from $478.7 million in Q3 2024[7] - Adjusted EBITDA for Q3 2025 was $68.5 million, up 52% from $45.2 million in Q3 2024[8] - Care Partners revenue was $897.7 million, reflecting a 97% increase from $455.8 million in the prior year[8] - Net income attributable to Astrana for Q3 2025 was $0.4 million, with diluted earnings per share of $0.01[8] - Total revenue for the three months ended September 30, 2025, was $956,048 thousand, representing a 100.0% increase from $478,710 thousand in the same period of 2024[26] - Net income for the nine months ended September 30, 2025, was $17,514 thousand, a decrease of 69.7% compared to $57,709 thousand for the same period in 2024[28] - Adjusted EBITDA for the nine months ended September 30, 2025, was $152,970 thousand, an increase of 12.9% from $135,332 thousand in the same period of 2024[31] - Earnings per share (diluted) for the three months ended September 30, 2025, was $0.01, a decrease from $0.33 in the same period of 2024[26] Guidance and Projections - The company updated its full-year 2025 guidance, projecting total revenue between $3,100 million and $3,180 million[13] - Net income guidance for the year ending December 31, 2025, is projected to be between $23,500,000 and $28,500,000[35] - EBITDA guidance for the same period is estimated to range from $124,000,000 to $134,000,000[35] - Adjusted EBITDA is expected to be between $200,000,000 and $210,000,000, providing a key performance measure for the company[35] Assets and Liabilities - Total assets as of September 30, 2025, were $2,237.2 million, compared to $1,354.9 million at the end of 2024[23] - Total stockholders' equity as of September 30, 2025, was $775,543 thousand, up from $712,720 thousand as of December 31, 2024, reflecting a growth of 8.8%[24] - Total liabilities, mezzanine deficit, and stockholders' equity amounted to $2,237,186 thousand as of September 30, 2025, compared to $1,354,894 thousand as of December 31, 2024[24] - The company reported a total of $1,302.4 million in assets that can only be used to settle obligations of its consolidated VIEs as of September 30, 2025[24] Cash Flow and Expenses - Cash flows from operating activities for the nine months ended September 30, 2025, were $117,483 thousand, compared to $63,146 thousand for the same period in 2024, indicating a significant increase[28] - The company incurred $548,553 thousand in payments for business acquisitions during the nine months ended September 30, 2025, compared to $115,494 thousand in the same period of 2024[28] - The company had a net cash increase of $175,224 thousand for the nine months ended September 30, 2025, compared to $54,488 thousand for the same period in 2024[28] Non-GAAP Measures - The company defines Adjusted EBITDA margin as Adjusted EBITDA over total revenue, emphasizing its importance in evaluating operational performance[36] - Non-GAAP measures like Adjusted EBITDA are used to assess the company's ongoing operating performance without the impact of non-recurring financial information[37] - The company believes that presenting non-GAAP financial measures provides investors with relevant information for evaluating business performance[37] - The reconciliation of GAAP and non-GAAP measures is provided to enhance understanding of the company's financial performance[37] Strategic Initiatives - The acquisition of Prospect Health was completed on July 1, 2025, enhancing the company's operational scale and capabilities[9] - A strategic partnership with Intermountain Health was announced to improve healthcare access in southern Nevada[14] - The company continues to control medical costs effectively, reiterating full-year trend expectations[7] Depreciation and Expenses - Interest expense is projected to be between $37,000,000 and $38,000,000, while provision for income taxes is expected to range from $18,000,000 to $22,000,000[35] - Depreciation and amortization is consistently estimated at $45,500,000 for the guidance period[35] - Stock-based compensation is projected to be $36,000,000, which is included in the Adjusted EBITDA calculation[35]

Core Insights - Astrana Health, Inc. reported strong third-quarter results for 2025, with significant revenue growth and successful integration of Prospect Health [2][9][10] - The company is focused on enhancing its care delivery platform and maintaining strong clinical and cost performance despite some delays in full-risk contract transitions [2][9] Financial Highlights for Q3 2025 - Total revenue reached $956.0 million, a 100% increase from $478.7 million in Q3 2024 [9][10] - Adjusted EBITDA was $68.5 million, up 52% from $45.2 million in the same quarter last year [10][22] - Net income attributable to Astrana was $0.4 million, with diluted earnings per share of $0.01 [10][20] Financial Highlights for Nine Months Ended September 30, 2025 - Total revenue for the nine months was $2,231.2 million, a 63% increase from $1,369.3 million [10][19] - Adjusted EBITDA for the nine months was $153.0 million, up 13% from $135.3 million [10][22] - Net income attributable to Astrana for the nine months was $16.5 million, with diluted earnings per share of $0.33 [10][20] Recent Operating Highlights - Care Partners revenue was $897.7 million, a 97% increase from $455.8 million in Q3 2024 [10][19] - The company successfully closed the acquisition of Prospect Health, which exceeded performance expectations [9][10] - Astrana announced a strategic partnership with Intermountain Health to enhance care access and improve patient outcomes in southern Nevada [10][19] Guidance for 2025 - Updated guidance for total revenue is projected between $3.1 billion and $3.18 billion, with Adjusted EBITDA expected between $200 million and $210 million [11][29] - The guidance reflects adjustments for full-risk contract delays unrelated to core performance [9][11] Cash Flow and Balance Sheet Highlights - Cash and cash equivalents as of September 30, 2025, were $462.2 million, up from $288.5 million at the end of 2024 [17][21] - Total assets increased to $2,237.2 million from $1,354.9 million at the end of 2024 [17][18] - Total liabilities rose to $1,682.5 million from $840.7 million at the end of 2024 [17][18]

Core Insights - Astrana Health, Inc. will release its financial results for Q3 2025 on November 6, 2025, after market close [1] - A conference call to discuss these results is scheduled for 2:30 p.m. PT/5:30 p.m. ET on the same day [1][2] Company Overview - Astrana Health is a physician-centric, AI-powered healthcare company focused on delivering high-quality, patient-centered care [3] - The company supports over 20,000 providers and more than 1.6 million patients in value-based care arrangements [4] - Astrana aims to improve patient outcomes, enhance experiences, and support provider well-being through its scalable care delivery infrastructure and proprietary technology [3][4]

Core Viewpoint - Investors are evaluating Astrana Health, Inc. (ASTH) and U.S. Physical Therapy (USPH) to determine which stock offers better value opportunities in the Medical - Outpatient and Home Healthcare sector [1] Valuation Metrics - ASTH has a Zacks Rank of 1 (Strong Buy), while USPH has a Zacks Rank of 3 (Hold), indicating a stronger earnings outlook for ASTH compared to USPH [3] - ASTH's forward P/E ratio is 23.09, significantly lower than USPH's forward P/E of 31.71, suggesting that ASTH may be undervalued [5] - The PEG ratio for ASTH is 0.78, while USPH's PEG ratio is 4.15, indicating that ASTH has a more favorable earnings growth outlook relative to its price [5] - ASTH's P/B ratio is 2.28, compared to USPH's P/B of 2.5, further supporting the argument that ASTH is a better value option [6] - ASTH has a Value grade of B, while USPH has a Value grade of C, reinforcing the conclusion that ASTH is the preferred choice for value investors [6]

Core Viewpoint - Astrana Health, Inc. (ASTH) is currently positioned as a more attractive investment option compared to U.S. Physical Therapy (USPH) based on various valuation metrics and earnings outlook [1][7]. Valuation Metrics - ASTH has a forward P/E ratio of 20.02, significantly lower than USPH's forward P/E of 33.65 [5]. - The PEG ratio for ASTH is 0.67, indicating a better valuation relative to its expected earnings growth compared to USPH's PEG ratio of 4.40 [5]. - ASTH's P/B ratio stands at 2.11, while USPH has a P/B ratio of 2.65, further suggesting that ASTH is undervalued [6]. Earnings Outlook - ASTH is experiencing an improving earnings outlook, which enhances its attractiveness in the Zacks Rank model, indicating a stronger potential for future earnings growth compared to USPH [3][7]. Investment Ratings - ASTH holds a Zacks Rank of 1 (Strong Buy), while USPH has a Zacks Rank of 2 (Buy), reflecting a more favorable investment sentiment towards ASTH [3]. Value Grades - ASTH has received a Value grade of A, whereas USPH has a Value grade of C, indicating that ASTH is perceived as a better value investment [6].

Group 1 - Astrana Health, Inc. reported quarterly earnings of $0.19 per share, missing the Zacks Consensus Estimate of $0.36 per share, and down from $0.4 per share a year ago, representing an earnings surprise of -47.22% [1] - The company posted revenues of $654.81 million for the quarter ended June 2025, surpassing the Zacks Consensus Estimate by 2.31%, and up from $486.27 million year-over-year [2] - Astrana Health, Inc. shares have lost about 30.8% since the beginning of the year, while the S&P 500 has gained 7.9% [3] Group 2 - The current consensus EPS estimate for the coming quarter is $0.58 on revenues of $946.77 million, and for the current fiscal year, it is $1.59 on revenues of $3.17 billion [7] - The Zacks Industry Rank for Medical - Outpatient and Home Healthcare is currently in the top 27% of over 250 Zacks industries, indicating a favorable outlook for the industry [8]

Financial Data and Key Metrics Changes - The company reported total revenues of $654.8 million for Q2 2025, representing a 35% year-over-year increase [6][16] - Adjusted EBITDA for the quarter was $48.1 million, reflecting strong profitability and cash flow generation [7][16] - Net income attributable to the company was $9.4 million, with an EPS of $0.19 per share [16] - The company closed the quarter with $342 million in cash and cash equivalents, and a pro forma net leverage ratio of 2.7 times [17] Business Line Data and Key Metrics Changes - Approximately 78% of revenue now comes from full risk contracts, up from 60% a year ago and 75% from the previous quarter [7] - The Care Partners segment continued to drive revenue growth as payer partners sought high-quality coordinated care [7] Market Data and Key Metrics Changes - Medical cost trends remained well controlled, coming in slightly below the full-year expectation of 4.5% [8] - Medicare Advantage and commercial lines of business performed below the 4.5% trend, while Medicaid ran slightly above but improved sequentially from Q1 [8][12] Company Strategy and Development Direction - The company aims to build a leading patient-centered healthcare platform by empowering entrepreneurial physicians and providers [6] - The integration of the Prospect Health acquisition is a key focus, with efforts to standardize workflows and align clinical operations [10] - The company updated its full-year 2025 revenue guidance to between $3.1 billion and $3.3 billion, and adjusted EBITDA guidance to between $215 million and $225 million [11][18] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in navigating upcoming Medicaid changes and maintaining growth and profitability despite potential headwinds [12][30] - The company remains optimistic about Medicare Advantage, supported by favorable rate notices and increased scale from the Prospect acquisition [13][58] Other Important Information - The company is focused on deleveraging its balance sheet to below 2.5 times over the next 12 to 18 months [11] - The company has minimal exposure to Part D risk, with fewer than 2% of members carrying any amount of Part D risk [13] Q&A Session Summary Question: How have Prospect's numbers been year to date over the first half of the year? - Management noted continued strength in the Prospect business, with great retention on both the provider and member sides [24][25] Question: What is the worst-case scenario for Medicaid and exchange impacts? - Management estimated a conservative 20% to 25% decline in Medicaid enrollment could lead to a revenue headwind of $200 million to $250 million [30] Question: Can you provide insights on the 4.5% blended utilization trend by geography? - Management stated that most revenue comes from California, and while they are not breaking out geographic trends, Nevada has shown profitability [34] Question: How are the rates trending for Medicaid in 2025? - Management indicated that negotiations are ongoing, and they have not accounted for any resolution in their guidance yet [42] Question: What are the expected synergies from the Prospect acquisition? - Management reiterated a synergy target of $12 million to $15 million over the first 12 to 18 months, with potential for upside as integration progresses [52][78] Question: How does the company ensure accurate coding and revenue per member? - Management highlighted their in-house RAF modeling and HEDIS programs, ensuring accurate risk adjustment practices [95]