Core Insights - Evolent Health, Inc. (NYSE: EVH) has experienced a significant double-digit decline in stock price since January, indicating a poor performance year-to-date [1] Company Performance - The stock price of Evolent Health has shown a very slow and poor performance throughout the year, with a notable double-digit drop [1] Analyst Background - Gamu Dave Innocent Pasi, a financial professional with extensive experience in investment research and analysis, has contributed insights into the financial landscape, focusing on actionable trading ideas and investment recommendations [1]

Core Viewpoint - Evolent Health, Inc. has announced the pricing of $145.0 million in 4.50% convertible senior notes due 2031, aimed at improving financial flexibility and reducing interest expenses while minimizing shareholder dilution [1][2][5]. Group 1: Transaction Details - The offering size was increased from $140.0 million to $145.0 million, with an additional option for initial purchasers to buy up to $21.75 million more [1]. - Evolent expects net proceeds of approximately $140.2 million, or $161.2 million if the additional notes option is fully exercised, which will be used primarily to repurchase existing convertible senior notes [5][7]. - The notes will mature on August 15, 2031, and interest will be paid semiannually at a rate of 4.50% [6]. Group 2: Conversion and Repurchase Terms - The notes are convertible at the option of the holders prior to maturity, with an initial conversion price of approximately $13.53 per share, representing a 50% premium over the closing price on August 18, 2025 [6]. - Evolent may terminate conversion rights under certain conditions related to the stock price performance [3]. - Holders can require Evolent to repurchase their notes upon a "fundamental change" at 100% of the principal amount plus accrued interest [4]. Group 3: Share Repurchase Impact - Evolent plans to repurchase approximately 4.43 million shares of its Class A common stock at a price of $9.02 per share, which may influence the market price of both the stock and the notes [8][9]. - The repurchase of shares sold short by initial investors could lead to increased market activity affecting the stock price [9]. Group 4: Company Overview - Evolent Health specializes in improving health outcomes for individuals with complex conditions and serves a national base of leading payers and providers [13].

Core Viewpoint - Evolent Health, Inc. plans to offer $140 million in convertible senior notes due 2031, with an option for initial purchasers to buy an additional $20 million, aimed at improving financial flexibility and supporting share repurchases [1][2]. Group 1: Offering Details - The offering consists of $140 million aggregate principal amount of convertible senior notes due 2031, subject to market conditions [1]. - Evolent expects to use up to $100 million of the net proceeds to repurchase a portion of its existing 1.50% convertible senior notes due 2025 and approximately $40 million for repurchasing shares of its Class A common stock [2]. - The notes will be convertible into cash, shares of Evolent's Class A common stock, or a combination thereof, with interest payable semiannually starting February 15, 2026 [4]. Group 2: Repurchase Strategy - Evolent plans to repurchase shares of its Class A common stock sold short by initial investors at a price equal to the last reported sale price on the pricing date, which may influence the market price of the stock [3]. - The company anticipates that holders of the 2025 Notes who agree to have their notes repurchased may unwind their hedges by buying Evolent's Class A common stock, potentially affecting the stock price [6]. Group 3: Conversion Rights - The conversion rights of the notes may be terminated by Evolent on or after August 20, 2026, under specific conditions related to the stock price performance [5]. - The conversion price and other terms of the notes will be determined at the time of the offering's pricing [4]. Group 4: Regulatory Information - The notes and any Class A common stock issued upon conversion will not be registered under the Securities Act, and may only be offered to qualified institutional buyers [7]. - The press release does not constitute an offer to sell or a solicitation to buy the securities described [8]. Group 5: Company Overview - Evolent Health specializes in improving health outcomes for individuals with complex conditions, serving a national base of leading payers and providers [9].

Evolent Health (EVH) FY Conference Summary Company Overview - **Company**: Evolent Health (EVH) - **Date of Conference**: August 13, 2025 - **Key Speakers**: CFO John Johnson, Richard Close from Canaccord Key Points and Arguments Financial Performance - **EBITDA Outperformance**: Evolent Health reported a strong performance in EBITDA, achieving a second consecutive beat for the year, leading to an increase in the lower end of their EBITDA guidance [5][12] - **Revenue Decline**: Despite the positive EBITDA performance, revenue guidance was lowered due to timing issues with performance suites and risk-based contracts [12][14] - **Claims Development**: Favorable claims development was noted, with trends below the 12% forecast for oncology costs, which were projected at a 10.5% trend for the year [5][6][26] Revenue Guidance Changes - **Partnership with Aetna**: A significant new partnership with Aetna for their Medicare Advantage population in Florida was announced, with a delay in the go-live date to Q1 of the following year due to data exchange preparations [14][16] - **Regulatory Delays**: A performance suite contract was delayed due to regulatory issues but is now set to go live on September 1 [16][17] - **Guidance Philosophy Shift**: The company adjusted its guidance philosophy, moving the fully contracted revenue point to the midpoint of the range to allow for potential faster deterioration in exchange membership [17][18] Cost Trends and Oncology - **Oncology Cost Trends**: The company is forecasting a 12% trend in oncology costs but is currently experiencing a trend of about 10.5%. The stability in authorization data is noted as a positive sign compared to the previous year's volatility [23][25][26][27] - **Pandemic Impact**: The spikes in cancer cases last year were attributed to pandemic-related factors, with expectations of a return to normal trends moving forward [27] Market Dynamics and Partnerships - **Vendor Consolidation Trend**: Evolent Health aims to be the enterprise partner of choice for managed care organizations, capitalizing on a trend of vendor consolidation in the industry [29][30] - **Regulatory Pressures**: Increasing regulatory requirements are driving managed care organizations to seek external partners like Evolent to meet commitments on turnaround times and data integration [36][38] Future Outlook - **Revenue Projections**: Evolent Health anticipates generating approximately $2.5 billion in revenue for the next year, supported by a robust pipeline of over $1 billion [41][33] - **EBITDA Growth**: The company aims for a 20% year-over-year growth in adjusted EBITDA, driven by both organic growth and margin expansion initiatives [43][41] - **AI Integration**: Evolent is on track to achieve a $20 million net improvement in unit costs through AI initiatives, with a long-term goal of $50 million in net EBITDA benefits [45][46] Cash Flow and Capital Allocation - **Cash Flow Expectations**: The company expects to generate about $65 million in cash from operations for the remainder of the year, following a one-time cash usage of $85 million in the first half [49][50] - **Deleveraging Strategy**: Evolent plans to deleverage by approximately one turn per year, focusing on capital allocation priorities [50] Additional Important Insights - **Data Connectivity Investments**: Evolent is investing in data connectivity and interoperability, which is expected to become an industry standard by 2027, enhancing their competitive position [39][40] - **Engagement with Regulatory Bodies**: The company is actively involved in discussions with AHIP and HHS to influence value-based care directions [40]

PART I - FINANCIAL INFORMATION [Item 1. Financial Statements](index=6&type=section&id=Item%201.%20Financial%20Statements) This section presents the unaudited interim consolidated financial statements for Evolent Health, Inc. as of June 30, 2025, and for the three and six-month periods then ended Consolidated Balance Sheet Highlights (Unaudited) | (in thousands) | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Assets** | | | | Cash and cash equivalents | $150,995 | $104,203 | | Total current assets | $562,257 | $607,117 | | Goodwill | $1,137,321 | $1,137,320 | | Total assets | $2,461,532 | $2,544,411 | | **Liabilities & Equity** | | | | Total current liabilities | $557,519 | $715,501 | | Long-term debt, net | $648,455 | $490,520 | | Total liabilities | $1,336,727 | $1,352,979 | | Total shareholders' equity | $896,005 | $1,001,259 | Consolidated Statement of Operations Highlights (Unaudited) | (in thousands, except per share data) | For the Six Months Ended June 30, 2025 | For the Six Months Ended June 30, 2024 | | :--- | :--- | :--- | | Revenue | $927,977 | $1,286,798 | | Total operating expenses | $930,770 | $1,292,419 | | Operating income (loss) | $(2,793) | $(5,621) | | Net loss attributable to common shareholders | $(123,340) | $(31,608) | | Loss per common share - Basic and diluted | $(1.07) | $(0.28) | Consolidated Statement of Cash Flows Highlights (Unaudited) | (in thousands) | For the Six Months Ended June 30, 2025 | For the Six Months Ended June 30, 2024 | | :--- | :--- | :--- | | Net cash (used in) provided by operating activities | $(25,769) | $26,326 | | Net cash used in investing activities | $(73,624) | $(23,273) | | Net cash provided by (used in) financing activities | $98,927 | $(88,499) | | Net decrease in cash and cash equivalents | $(526) | $(85,508) | [Note 4. Transactions](index=20&type=section&id=Note%204.%20Transactions) On August 1, 2024, the company acquired certain assets of Machinify, Inc. for $28.5 million, enhancing its AI capabilities Machinify Acquisition Purchase Price Allocation (August 1, 2024) | (in thousands) | Amount | | :--- | :--- | | **Purchase Consideration** | | | Cash | $19,500 | | Fair value of contingent consideration | $9,000 | | **Total consideration** | **$28,500** | | **Allocation** | | | Technology (Intangible Asset) | $7,700 | | Goodwill | $20,809 | | Liabilities assumed | $9 | | **Net assets acquired** | **$28,500** | [Note 5. Revenue Recognition](index=20&type=section&id=Note%205.%20Revenue%20Recognition) Revenue is primarily from multi-year contracts for care management services, recognized over time, with a significant year-over-year decrease in Medicare and Performance Suite revenue Disaggregation of Revenue by Line of Business (in thousands) | Line of Business | Q2 2025 | Q2 2024 | YTD 2025 | YTD 2024 | | :--- | :--- | :--- | :--- | :--- | | Medicaid | $193,018 | $217,068 | $381,142 | $432,192 | | Medicare | $109,042 | $268,673 | $224,360 | $555,633 | | Commercial and other | $142,268 | $161,404 | $322,475 | $298,973 | | **Total** | **$444,328** | **$647,145** | **$927,977** | **$1,286,798** | Disaggregation of Revenue by Product Type (in thousands) | Product Type | Q2 2025 | Q2 2024 | YTD 2025 | YTD 2024 | | :--- | :--- | :--- | :--- | :--- | | Performance Suite | $267,917 | $461,602 | $570,938 | $909,820 | | Specialty Technology and Services Suite | $81,401 | $81,515 | $164,222 | $170,518 | | Administrative Services | $55,880 | $60,770 | $113,071 | $119,339 | | Cases | $39,130 | $43,258 | $79,746 | $87,121 | | **Total** | **$444,328** | **$647,145** | **$927,977** | **$1,286,798** | [Note 8. Goodwill and Intangible Assets, Net](index=25&type=section&id=Note%208.%20Goodwill%20and%20Intangible%20Assets%2C%20Net) As of June 30, 2025, the company held $1.14 billion in goodwill and $651.2 million in net intangible assets, with no impairment identified - The annual goodwill impairment test as of October 31, 2024, concluded that goodwill was not impaired, as the reporting unit's fair value exceeded its carrying value by approximately **$336.0 million**, or **13.6%**[96](index=96&type=chunk) - Amortization expense for intangible assets decreased to **$33.6 million** for the six months ended June 30, 2025, from **$44.0 million** in the prior year period, primarily because several corporate trade names were fully amortized by December 2024[99](index=99&type=chunk) [Note 9. Debt](index=29&type=section&id=Note%209.%20Debt) The company's debt includes $575 million in Convertible Senior Notes and a First Lien Credit Agreement, with a new $150.0 million facility secured to retire 2025 Notes Summary of Convertible Senior Notes (as of June 30, 2025) | Term | 2025 Notes | 2029 Notes | | :--- | :--- | :--- | | Aggregate principal amount | $172,500,000 | $402,500,000 | | Interest rate | 1.5% | 3.5% | | Maturity date | Oct 15, 2025 | Dec 1, 2029 | | Conversion price | $33.43 | $38.00 | | Carrying value | $172,119,000 | $393,880,000 | - During the six months ended June 30, 2025, the Company borrowed **$200.0 million** under its Term Loan Facility. As of June 30, 2025, **$262.5 million** was outstanding under the Term Loan and Revolving Facilities[128](index=128&type=chunk) - On June 19, 2025, the company secured a commitment letter from Ares for up to **$150.0 million** in additional debt capital to retire its 2025 Notes and for working capital[118](index=118&type=chunk) [Note 10. Commitments and Contingencies](index=33&type=section&id=Note%2010.%20Commitments%20and%20Contingencies) The company faces significant revenue concentration risk with key partners and has a Tax Receivables Agreement liability of $108.1 million Revenue Concentration by Partner (YTD) | Partner | % of Revenue YTD 2025 | % of Revenue YTD 2024 | | :--- | :--- | :--- | | Molina Healthcare, Inc. | 24.1% | 12.1% | | Cook County Health and Hospitals System | 16.5% | 11.2% | | Florida Blue Medicare, Inc. | 14.5% | 12.6% | | Centene Corporation | 11.2% | * | | Humana Insurance Company | * | 21.7% | | *Represents less than 10.0%* | | | - As of June 30, 2025, the company had a Tax Receivables Agreement (TRA) liability of **$108.1 million**, representing its obligation to pay certain pre-IPO investors 85% of specific tax benefits it realizes[136](index=136&type=chunk)[137](index=137&type=chunk) [Note 16. Investments and Equity Method Investees](index=39&type=section&id=Note%2016.%20Investments%20and%20Equity%20Method%20Investees) In Q2 2025, the company purchased the remaining interest in an equity method investment for $51.5 million, recognizing a $52.5 million loss - In Q2 2025, the company purchased the remaining portion of an equity method investment for **$51.5 million**, recognizing a loss of **$52.5 million**, which represents the difference between the fixed purchase price and the estimated fair value of the interests acquired[172](index=172&type=chunk) [Note 21. Reserve for Claims and Performance-Based Arrangements](index=46&type=section&id=Note%2021.%20Reserve%20for%20Claims%20and%20Performance-Based%20Arrangements) The company's reserve for claims and performance-based arrangements decreased to $187.3 million as of June 30, 2025, due to claims payments exceeding newly incurred costs Activity in Reserves for Claims and Performance-Based Arrangements (in thousands) | | For the Six Months Ended June 30, 2025 | For the Six Months Ended June 30, 2024 | | :--- | :--- | :--- | | Balance, beginning of period | $318,705 | $404,048 | | Total claims incurred | $420,239 | $731,158 | | Total claims paid | $(551,693) | $(817,643) | | **Balance, end of period** | **$187,251** | **$317,563** | [Note 23. Subsequent Events](index=48&type=section&id=Note%2023.%20Subsequent%20Events) Subsequent to quarter-end, the "One Big Beautiful Bill Act" was enacted, and the company exchanged its Series A Preferred Shares for a new second lien term loan facility - On August 7, 2025, the company completed the exchange of its Series A Preferred Shares for a new second lien term loan facility with similar economic terms but without a common stock conversion feature[209](index=209&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=48&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses the company's financial performance, highlighting a significant revenue decrease in H1 2025 due to contractual updates, while medical claims cost growth slowed [Recent Events and Industry Climate](index=48&type=section&id=Recent%20Events%20and%20Industry%20Climate) Medical claims costs continued to rise in H1 2025, albeit at a slower pace, and the company completed a significant financing transaction by exchanging Series A Preferred Shares - Medical claims costs in the Performance Suite continued to grow faster than historical averages in the first half of 2025, though at a slower pace than in previous quarters, impacting financial results[216](index=216&type=chunk) - On August 7, 2025, the company exchanged its Series A Preferred Shares for a new second lien term loan, which has substantively similar economic terms but lacks a common stock conversion feature[221](index=221&type=chunk) [Results of Operations](index=51&type=section&id=Results%20of%20Operations) Revenue for the first six months of 2025 decreased by 27.9% to $928.0 million due to contractual changes, leading to a shift towards higher-margin business Consolidated Results Summary (YTD) | (in thousands) | YTD 2025 | YTD 2024 | Change ($) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Revenue | $927,977 | $1,286,798 | $(358,821) | (27.9)% | | Cost of revenue | $725,121 | $1,075,849 | $(350,728) | (32.6)% | | Selling, general and administrative | $153,618 | $148,289 | $5,329 | 3.6% | | Operating income (loss) | $(2,793) | $(5,621) | $2,828 | 50.3% | - The decrease in total revenue for the first six months of 2025 was primarily driven by contractual updates, including transitioning a customer from Performance Suite to Specialty Technology and Services Suite (**$257.6 million** impact) and narrowing the scope with other Performance Suite customers (**$96.6 million** impact)[255](index=255&type=chunk) - Cost of revenue as a percentage of total revenue decreased from **83.6%** to **78.1%** for the six months ended June 30, year-over-year, reflecting a shift in business mix towards higher-margin product types[258](index=258&type=chunk) [Liquidity and Capital Resources](index=57&type=section&id=Liquidity%20and%20Capital%20Resources) As of June 30, 2025, the company had $151.0 million in cash, with net cash used in operating activities of $25.8 million, primarily due to prior-year contract payments Summary of Cash Flows (in thousands) | | For the Six Months Ended June 30, 2025 | For the Six Months Ended June 30, 2024 | | :--- | :--- | :--- | | Net cash (used in) provided by operating activities | $(25,769) | $26,326 | | Net cash used in investing activities | $(73,624) | $(23,273) | | Net cash provided by (used in) financing activities | $98,927 | $(88,499) | - Cash used in operating activities for H1 2025 was primarily driven by **$67.5 million** in payments to clients for reconciliations of prior-year Performance Suite contracts that have since been restructured[277](index=277&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=60&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company's primary market risk is interest rate fluctuations, with a 1% SOFR increase leading to a $2.63 million rise in annual interest expense - The company is exposed to interest rate risk on its variable-rate debt. For every **1%** increase in the SOFR, annual interest expense on outstanding term and revolving loans would increase by **$2.63 million**[294](index=294&type=chunk) [Item 4. Controls and Procedures](index=60&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that the company's disclosure controls and procedures were effective as of June 30, 2025, with no material changes in internal control over financial reporting - Management concluded that the company's disclosure controls and procedures were effective as of June 30, 2025[299](index=299&type=chunk) PART II - OTHER INFORMATION [Item 1. Legal Proceedings](index=62&type=section&id=Item%201.%20Legal%20Proceedings) A shareholder derivative action was dismissed in January 2023, and a subsequent demand for litigation was refused by the Board after an investigation - A shareholder derivative action was dismissed in January 2023. The Board later investigated and refused a subsequent shareholder demand to commence litigation related to the same matters[139](index=139&type=chunk)[304](index=304&type=chunk) [Item 1A. Risk Factors](index=62&type=section&id=Item%201A.%20Risk%20Factors) The company updates its risk factors, emphasizing those related to significant indebtedness, potential need for additional financing, and restrictive covenants - The company highlights significant risks associated with its substantial debt, which could make it difficult to satisfy obligations, limit its ability to obtain additional financing, and place it at a competitive disadvantage[306](index=306&type=chunk)[314](index=314&type=chunk) - Restrictive covenants in the company's Credit Agreements impose limitations on incurring additional debt, selling assets, making investments, and paying dividends, which could interfere with business activities[316](index=316&type=chunk)[320](index=320&type=chunk) [Item 5. Other Information](index=65&type=section&id=Item%205.%20Other%20Information) On August 7, 2025, the company exchanged its Series A Preferred Shares for a new $175.0 million second lien term loan facility, removing the common stock conversion feature - On August 7, 2025, the company exchanged its Series A Preferred Shares for a new **$175.0 million** second lien term loan facility, which has similar economic terms but no equity conversion feature[323](index=323&type=chunk)[324](index=324&type=chunk) - The new Second Lien Term Loan Facility matures on December 6, 2029, and carries an interest rate of SOFR + **6.00%** or ABR + **5.00%**, subject to step-downs[325](index=325&type=chunk)[326](index=326&type=chunk)

Core Insights - Evolent Health reported a revenue of $444.33 million for the quarter ended June 2025, marking a year-over-year decline of 31.3% and an EPS of -$0.10 compared to $0.30 a year ago, indicating significant financial challenges [1] - The revenue fell short of the Zacks Consensus Estimate of $457.4 million by 2.86%, and the EPS was below the consensus estimate of $0.09 by 211.11% [1] Financial Performance - Evolent Health's stock has returned -16.7% over the past month, contrasting with the Zacks S&P 500 composite's +1.2% change, suggesting underperformance relative to the broader market [3] - The company currently holds a Zacks Rank 3 (Hold), indicating it may perform in line with the market in the near term [3] Key Metrics Analysis - Average PMPM Fees / Revenue per Case for Performance Suite was $13.76, below the estimated $14.21 [4] - Average PMPM Fees / Revenue per Case for Specialty Technology and Services Suite was $0.35, slightly below the estimated $0.36 [4] - Average PMPM Fees / Revenue per Case for Administrative Services was $15.13, compared to the estimated $15.82 [4] - Average Lives on Platform / Cases for Cases was 13 thousand, below the estimated 14.39 thousand [4] - Average Lives on Platform / Cases for Performance Suite was 6.49 million, slightly above the estimated 6.48 million [4] - Average Lives on Platform / Cases for Specialty Technology and Services Suite was 77.02 million, below the estimated 77.71 million [4] - Average Lives on Platform / Cases for Administrative Services was 1.23 million, slightly above the estimated 1.22 million [4] - Average PMPM Fees / Revenue per Case for Cases was $2,969.00, below the estimated $3,008.56 [4]

Company Performance - Evolent Health reported a quarterly loss of $0.1 per share, missing the Zacks Consensus Estimate of $0.09, and down from earnings of $0.3 per share a year ago, representing an earnings surprise of -211.11% [1] - The company posted revenues of $444.33 million for the quarter ended June 2025, missing the Zacks Consensus Estimate by 2.86%, and down from $647.15 million year-over-year [2] - Evolent Health has not surpassed consensus EPS estimates over the last four quarters and has topped consensus revenue estimates only once during the same period [2] Stock Performance - Evolent Health shares have declined approximately 16.4% since the beginning of the year, contrasting with the S&P 500's gain of 7.9% [3] - The current Zacks Rank for Evolent Health is 3 (Hold), indicating that the shares are expected to perform in line with the market in the near future [6] Future Outlook - The current consensus EPS estimate for the upcoming quarter is $0.12 on revenues of $539.68 million, and for the current fiscal year, it is $0.40 on revenues of $2.06 billion [7] - The outlook for the Medical Info Systems industry, where Evolent Health operates, is currently in the top 37% of Zacks industries, suggesting a favorable environment for stock performance [8]

Financial Data and Key Metrics Changes - Q2 adjusted EBITDA was $37.5 million, in the top half of the range, driven by strong results across technology and services and performance suite models [16] - Q2 revenue was $444 million, $11 million below the midpoint of guidance, primarily due to lower revenue for 2024 and go-live timing issues [19][20] - The company updated its full-year revenue outlook to between $1.85 billion and $1.88 billion [27] Business Line Data and Key Metrics Changes - The performance suite normalized oncology trend was approximately 10.5%, modestly below the initial forecast of 12% [16] - The company achieved four new revenue agreements, bringing the total to 11 new agreements year-to-date [5] - The oncology performance suite offering is expanding to include inpatient or Part A oncology costs, reflecting an addressable market expansion [8] Market Data and Key Metrics Changes - About 25% of Q2 revenue and over 80% of new business announced for 2026 is in Medicare, with expectations of a return to normal macro membership growth [25] - Approximately 10% of Q2 revenue is in the commercial fully insured line of business, expected to remain stable [25] - Medicaid revenue accounted for about 45% of Q2 revenue, with typical annual growth of 2% to 3% expected [25] Company Strategy and Development Direction - The company is focused on organic growth, margin expansion, and capital allocation, with no plans for M&A in the near term [12] - The strategy includes enhancing AI and automation capabilities to improve efficiency and member experience [10] - The company aims to grow adjusted EBITDA at 20% per year despite industry volatility [14] Management's Comments on Operating Environment and Future Outlook - Management noted a challenging operating environment with elevated utilization and lagging premiums [12] - The company expects strong selling conditions in the coming years due to pressures on health plans [8] - Management remains cautiously optimistic about future performance, maintaining a conservative approach to forecasting [9] Other Important Information - The company plans to launch its partnership with Aetna in Q1 2026, targeting 250,000 Medicare Advantage members in Florida [6][7] - The company has a strong late-stage pipeline and anticipates additional growth announcements in the fall [8] Q&A Session Summary Question: Aetna partnership and market density - Management highlighted the significance of the Aetna partnership and its potential for expansion into additional states, with expected margin ramp consistent with typical performance suite margins [29][33] Question: Changes in contract structuring and customer engagement - Management noted that the pipeline has grown to $1 billion, driven by enhanced contract terms and the industry's challenges in managing high-cost specialty categories [35][37] Question: Aetna contract launch timeline - Management expressed confidence in the Aetna contract launch timeframe, emphasizing the importance of having all necessary components in place for a successful rollout [40] Question: Exchange business and ACA risk pools - Management acknowledged the lower margin nature of the exchange business and indicated a focus on protecting downside risks while growing the business [43][45] Question: Performance Suite pipeline and specialty focus - Management indicated that the Performance Suite pipeline is heavily focused on oncology, with a mix of national and regional plans [47][49] Question: Revenue growth expectations for 2026 - Management projected a clear path to exceeding $2.5 billion in revenue for 2026, based on the weighted pipeline and expected go-live timing [53][55]

Financial Performance - Revenue reached $4443 million, which includes a $46 million reduction due to favorable prior year claims development[6] - Adjusted EBITDA was $375 million, placing it in the upper range of expectations, with an adjusted EBITDA margin of 85%[6] - The company reported a net loss attributable to common shareholders of $511 million for Q2 2025, compared to a net loss of $64 million in Q2 2024[6] Growth & Outlook - Evolent announced four new revenue arrangements in Tech & Services and the Performance Suite, bringing the year-to-date total to 11 new arrangements[6] - The company updated the Q1 2026 go-live date for a new relationship with a large national Performance Suite partner to ensure optimal data exchange[6] - The 2025 full-year revenue is projected to be between $185 billion and $188 billion, with adjusted EBITDA between $140 million and $165 million[8] Capital & Liquidity - As of June 30, 2025, Evolent had $1510 million in cash and cash equivalents, along with $625 million in revolver availability[6] - The period-end net leverage stood at 53x based on LTM Adjusted EBITDA of $1288 million[6] - Total debt was reported as $820574 million, with net debt at $686505 million[18]

```markdown [Executive Summary](index=1&type=section&id=Executive%20Summary) Evolent Health exceeded Q2 EBITDA targets, raised full-year profitability outlook, and saw accelerating new business, driven by demand for specialty care solutions and progress with Auth Intelligence AI [Q2 2025 Performance Overview](index=1&type=section&id=Q2%202025%20Performance%20Overview) Evolent Health exceeded its Q2 EBITDA targets and raised its full-year profitability outlook, driven by a rapidly accelerating new business pipeline and robust demand for complex specialty care solutions. The company also noted progress with its Auth Intelligence AI and automation targets - **Evolent** exceeded **Q2 EBITDA targets** and raised the **full-year profitability outlook**[3](index=3&type=chunk) - The company anticipates exceeding **historical growth rates for 2026** due to a **rapidly accelerating new business pipeline**[3](index=3&type=chunk) - **Auth Intelligence**, one year after launch, is on track to achieve **near-term AI and automation targets by the end of 2025**, aspiring to become a market leader in clinical data exchange and AI[3](index=3&type=chunk) - **Robust demand** for Evolent's **complex specialty care solutions** is driven by **rising medical costs** impacting health plans[3](index=3&type=chunk) Financial Highlights (Q2 2025 vs Q2 2024) ($ in thousands) | Metric | Q2 2025 | Q2 2024 | Change | | :--------------------------------------- | :-------- | :-------- | :------- | | Revenue | $444,328 | $647,145 | -31.3% | | Net loss attributable to common shareholders | $(51,090) | $(6,383) | -700.4% | | Net loss margin | (11.5)% | (1.0)% | -10.5 pp | | Adjusted EBITDA | $37,547 | $51,950 | -27.7% | | Adjusted EBITDA Margin | 8.5% | 8.0% | +0.5 pp | Operational Highlights (Q2 2025 vs Q2 2024) | Metric | Q2 2025 | Q2 2024 | Change | | :----------------------------------- | :-------- | :-------- | :------- | | Performance Suite Lives on Platform | 6,490 | 6,901 | -5.9% | | Specialty Technology and Services Suite Lives on Platform | 77,019 | 71,701 | +7.4% | | Administrative Services Lives on Platform | 1,231 | 1,268 | -2.9% | | Cases | 13 | 15 | -13.3% | | Average Unique Members | 40,201 | 39,856 | +0.9% | Average PMPM Fees/Revenue per Case (Q2 2025 vs Q2 2024) ($) | Metric | Q2 2025 | Q2 2024 | Change | | :----------------------------------- | :-------- | :-------- | :------- | | Performance Suite | $13.76 | $22.30 | -38.3% | | Specialty Technology and Services Suite | $0.35 | $0.38 | -7.9% | | Administrative Services | $15.13 | $15.97 | -5.2% | | Cases | $2,969 | $2,849 | +4.2% | [CEO Commentary](index=1&type=section&id=CEO%20Commentary) Seth Blackley, Co-Founder and CEO, highlighted Evolent's strong Q2 performance, exceeding EBITDA targets and raising the full-year profitability outlook. He emphasized the accelerating new business pipeline, the company's critical role in improving healthcare quality and affordability, and confidence in achieving AI and automation targets with Auth Intelligence - **Evolent** exceeded **Q2 EBITDA targets** and raised the **full-year profitability outlook**[3](index=3&type=chunk) - The company expects to exceed historical growth rates for 2026 due to a rapidly accelerating new business pipeline[3](index=3&type=chunk) - Evolent's solutions aim to improve quality for members, reduce administrative burden for providers, and manage affordability for the system[3](index=3&type=chunk) - Confidence in achieving near-term AI and automation targets exiting 2025 with Auth Intelligence, aiming to become a leader in clinical data exchange and AI[3](index=3&type=chunk) [Financial Performance](index=1&type=section&id=Financial%20Performance) Evolent Health reported a significant GAAP net loss in Q2 2025, while adjusted results showed a decrease in Adjusted EBITDA despite margin improvement, alongside mixed operational metric trends [GAAP Reported Results](index=2&type=section&id=GAAP%20Reported%20Results) Evolent Health reported a net loss attributable to common shareholders of $(51.1) million for Q2 2025, a significant increase from $(6.4) million in Q2 2024, despite a decrease in revenue. Loss per share also increased substantially GAAP Financial Results (Q2 2025 vs Q2 2024) ($ in thousands) | Metric | Q2 2025 | Q2 2024 | Change | | :--------------------------------------- | :-------- | :-------- | :------- | | Revenue | $444,328 | $647,145 | -31.3% | | Cost of revenue | $343,943 | $540,302 | -36.3% | | Selling, general and administrative expenses | $75,209 | $69,185 | +8.7% | | Net loss attributable to common shareholders | $(51,090) | $(6,383) | -700.4% | | Net loss margin | (11.5)% | (1.0)% | -10.5 pp | | Loss per share (Basic and diluted) | $(0.44) | $(0.06) | -633.3% | - **Total cash and cash equivalents** were **$151.0 million** as of June 30, 2025[5](index=5&type=chunk) [Non-GAAP Adjusted Results](index=2&type=section&id=Non-GAAP%20Adjusted%20Results) Evolent Health's adjusted results for Q2 2025 show a decrease in Adjusted EBITDA and a shift from adjusted income to adjusted loss per common share compared to Q2 2024, despite an increase in Adjusted EBITDA margin Adjusted Financial Results (Q2 2025 vs Q2 2024) ($ in thousands) | Metric | Q2 2025 | Q2 2024 | Change | | :--------------------------------------- | :-------- | :-------- | :------- | | Adjusted cost of revenue | $342,893 | $539,095 | -36.4% | | Adjusted selling, general and administrative expenses | $63,888 | $56,100 | +13.9% | | Adjusted EBITDA | $37,547 | $51,950 | -27.7% | | Adjusted EBITDA margin | 8.5% | 8.0% | +0.5 pp | | Adjusted income (loss) attributable to common shareholders | $(11,013) | $21,065 | -152.3% | | Adjusted income (loss) per common share (Basic) | $(0.10) | $0.18 | -155.6% | [Key Operational Metrics](index=1&type=section&id=Key%20Operational%20Metrics) Evolent's operational metrics for Q2 2025 show mixed trends, with growth in Specialty Technology and Services Suite Lives on Platform and Cases revenue per case, but declines in Performance Suite and Administrative Services metrics Average Lives on Platform/Cases (Q2 2025 vs Q2 2024) | Metric | Q2 2025 | Q2 2024 | Change | | :----------------------------------- | :-------- | :-------- | :------- | | Performance Suite | 6,490 | 6,901 | -5.9% | | Specialty Technology and Services Suite | 77,019 | 71,701 | +7.4% | | Administrative Services | 1,231 | 1,268 | -2.9% | | Cases | 13 | 15 | -13.3% | | Average Unique Members | 40,201 | 39,856 | +0.9% | Average PMPM Fees/Revenue per Case (Q2 2025 vs Q2 2024) ($) | Metric | Q2 2025 | Q2 2024 | Change | | :----------------------------------- | :-------- | :-------- | :------- | | Performance Suite | $13.76 | $22.30 | -38.3% | | Specialty Technology and Services Suite | $0.35 | $0.38 | -7.9% | | Administrative Services | $15.13 | $15.97 | -5.2% | | Cases | $2,969 | $2,849 | +4.2% | [Business Developments](index=2&type=section&id=Business%20Developments) Evolent Health secured four new revenue agreements in Q2 2025, expanding existing partnerships with new states, lines of business, and specialty care solutions [New Revenue Agreements](index=2&type=section&id=New%20Revenue%20Agreements) Evolent announced four new revenue agreements in Q2 2025, bringing the year-to-date total to 11. These agreements include expansions with existing national and regional partners, adding new states, lines of business, and specialty care solutions like Oncology, Cardiology, Radiation Oncology, and Musculoskeletal services - **Evolent** announced **four new revenue agreements** in **Q2 2025**, bringing the year-to-date total to **11**[4](index=4&type=chunk) - An existing national partner is adding a new state in the mid-west for Oncology and Cardiology - An existing partner in the north-east will add cardiology, radiation oncology, and musculoskeletal solutions across multiple lines of business for more than 400,000 members - A regional partner in New England will add musculoskeletal and cardiology services across multiple lines of business - A national partner will add additional musculoskeletal services to a plan in the northeast[7](index=7&type=chunk) [Business Outlook and Guidance](index=3&type=section&id=Business%20Outlook%20and%20Guidance) Evolent Health provided Q3 2025 guidance and revised its full-year 2025 outlook, raising Adjusted EBITDA while adjusting revenue due to go-live timing, maintaining strong customer retention [Third Quarter 2025 Guidance](index=3&type=section&id=Third%20Quarter%202025%20Guidance) For the third quarter ending September 30, 2025, Evolent expects revenue to be in the range of $460 million to $480 million, and Adjusted EBITDA to be between $34 million and $42 million Third Quarter 2025 Guidance ($ in millions) | Metric | Range | | :------------- | :------------ | | Revenue | $460M - $480M | | Adjusted EBITDA | $34M - $42M | [Full Year 2025 Guidance](index=3&type=section&id=Full%20Year%202025%20Guidance) Evolent revised its full-year 2025 guidance, raising the Adjusted EBITDA outlook to $140 million to $165 million. The revenue outlook was adjusted to $1.85 billion to $1.88 billion, reflecting updated go-live timing for certain Performance Suite launches, while customer retention and pipeline activity remain strong Full Year 2025 Guidance ($ in millions/billions) | Metric | Range | | :------------- | :------------ | | Adjusted EBITDA | $140M - $165M (raised) | | Revenue | $1.85B - $1.88B (revised) | - The **revenue outlook revision** is due to **updated go-live timing** for certain Performance Suite launches[10](index=10&type=chunk) - The company continues to experience **strong customer retention** and **late-stage pipeline activity**[10](index=10&type=chunk) [Capitalized Software Development Outlook](index=3&type=section&id=Capitalized%20Software%20Development%20Outlook) Evolent reiterated its expectation to deploy approximately $35 million in cash for capitalized software development during 2025 - Expected **cash deployment** for **capitalized software development** in **2025**: approximately **$35 million**[11](index=11&type=chunk) [Company Information](index=3&type=section&id=Company%20Information) Evolent Health, Inc. specializes in improving healthcare outcomes for complex conditions, providing details on its Q2 2025 conference call and investor relations contact [About Evolent Health, Inc.](index=3&type=section&id=About%20Evolent%20Health,%20Inc.) Evolent specializes in improving health outcomes for individuals with complex conditions by providing solutions that make healthcare simpler and more affordable. The company serves a national base of leading payers and providers and is recognized as a top workplace in healthcare - **Evolent** specializes in **better health outcomes** for people with **complex conditions**[14](index=14&type=chunk) - Provides **proven solutions** that make **health care simpler and more affordable**[14](index=14&type=chunk) - Serves a **national base of leading payers and providers** and is consistently recognized as a **top place to work in health care**[14](index=14&type=chunk) [Web and Conference Call Information](index=3&type=section&id=Web%20and%20Conference%20Call%20Information) Evolent Health held a conference call on August 7, 2025, to discuss its financial performance. Details for accessing the live broadcast via the investor relations website and participating by telephone were provided, with an archive available for one week - **Conference call** held on **August 7, 2025**, at **5:00 p.m. Eastern Time**[13](index=13&type=chunk) - **Live broadcast** and accompanying materials available on the Company's **Investor Relations website** at http://ir.evolent.com[13](index=13&type=chunk) - **Telephone participation details** provided for domestic and international callers[13](index=13&type=chunk) [Contacts](index=3&type=section&id=Contacts) For investor relations inquiries, Evolent Health can be contacted via email at investorrelations@evolent.com - **Investor relations contact**: investorrelations@evolent.com[15](index=15&type=chunk) [Supplemental Information](index=5&type=section&id=Supplemental%20Information) This section provides definitions for Evolent Health's key operational metrics and explains the rationale and adjustments for its non-GAAP financial measures [Definitions of Key Operational Metrics](index=5&type=section&id=Definitions%20of%20Key%20Operational%20Metrics) This section defines key operational metrics used by Evolent, including Revenue Agreements, Lives on Platform (Performance Suite, Specialty Technology and Services Suite, Administrative Services), Cases, PMPM Fees, Revenue per Case, and Average Unique Members, explaining their calculation and relevance for evaluating unit economics and operational performance - **Revenue Agreements:** Include incremental revenue from new partner entities or additional sales to existing partners (services, geographic, line of business expansions, or conversion of Specialty Technology to Performance Suite contracts) Excludes renewals, membership growth within existing contracts, or transaction-related purchase agreements - **Lives on Platform:** Calculated by summing monthly members covered for specialty care services (Performance Suite, Specialty Technology and Services Suite) or administrative services (Administrative Services), divided by the number of months in the period - **Cases:** Sum of individuals receiving services through surgery management and advanced care planning programs in a given period - **Average PMPM Fee:** Revenue for a specific suite divided by its Lives on Platform for the period, divided by the number of months - **Revenue per Case:** Revenue for surgery management and advanced care planning programs divided by the number of cases - **Average Unique Members:** Sum of members covered by Performance Suite, Specialty Technology and Services Suite, and Administrative Services, with members crossing multiple solutions counted only once from the solution with maximum members[16](index=16&type=chunk)[17](index=17&type=chunk)[18](index=18&type=chunk)[19](index=19&type=chunk) - Management uses these measures to provide insight into the **unit economics of services** and **period-over-period operational performance**[20](index=20&type=chunk) [Non-GAAP Financial Measures Explanation](index=11&type=section&id=Non-GAAP%20Financial%20Measures%20Explanation) Evolent presents several non-GAAP financial measures, including Adjusted Cost of Revenue, Adjusted SG&A, Adjusted EBITDA, Adjusted EBITDA Margin, Adjusted Income (Loss) Attributable to Common Shareholders, and Adjusted EPS. These measures are used to provide investors with a clearer understanding of fundamental operational performance by excluding non-recurring or non-operational costs such as stock-based compensation, severance, transaction-related, and repositioning costs - **Non-GAAP financial measures** are presented as supplemental measures to help investors evaluate **fundamental operational performance**[28](index=28&type=chunk) - **Adjusted Cost of Revenue and Adjusted Selling, General and Administrative Expenses:** Exclude stock-based compensation, severance, transaction-related, and repositioning costs to facilitate understanding of long-term operational costs - **Adjusted EBITDA:** Excludes various non-operating and non-cash items from net loss attributable to common shareholders to focus on operational performance - **Adjusted EBITDA Margin:** Adjusted EBITDA divided by Revenue, useful for understanding operational performance compared to revenues over time - **Adjusted Income (Loss) Attributable to Common Shareholders and Adjusted Income (Loss) per Share Attributable to Common Shareholders:** Adjust net loss for various non-GAAP items and their tax impact to provide a more comparable measure of net profitability and a meaningful basis for forecasting future performance[29](index=29&type=chunk)[30](index=30&type=chunk)[31](index=31&type=chunk)[32](index=32&type=chunk)[33](index=33&type=chunk)[34](index=34&type=chunk)[35](index=35&type=chunk)[36](index=36&type=chunk) - These adjusted measures are **not alternatives to GAAP measurements** and may not be comparable to similarly titled measures reported by other companies[37](index=37&type=chunk) [Consolidated Financial Statements](index=6&type=section&id=Consolidated%20Financial%20Statements) Evolent Health's Q2 2025 consolidated financial statements show a significant net loss, decreased total assets with increased cash and long-term debt, and net cash used in operating activities [Consolidated Statements of Operations and Comprehensive Income (Loss)](index=6&type=section&id=Consolidated%20Statements%20of%20Operations%20and%20Comprehensive%20Income%20(Loss)) For the three months ended June 30, 2025, Evolent Health reported a net loss attributable to common shareholders of $(51.1) million, a substantial increase from $(6.4) million in the prior year, primarily due to decreased revenue and increased interest expense and dividends on Series A Preferred Stock Consolidated Statements of Operations (Q2 2025 vs Q2 2024) ($ in thousands) | Metric | Q2 2025 | Q2 2024 | Change | | :--------------------------------------------------- | :-------- | :-------- | :------- | | Revenue | $444,328 | $647,145 | -31.3% | | Total operating expenses | $445,499 | $639,357 | -30.3% | | Operating income (loss) | $(1,171) | $7,788 | -115.0% | | Net loss attributable to common shareholders | $(51,090) | $(6,383) | -700.4% | | Basic and diluted loss per common share | $(0.44) | $(0.06) | -633.3% | [Consolidated Balance Sheets](index=7&type=section&id=Consolidated%20Balance%20Sheets) As of June 30, 2025, Evolent Health's total assets decreased to $2.46 billion from $2.54 billion at December 31, 2024. Notable changes include an increase in cash and cash equivalents, a decrease in accounts receivable, and a significant increase in long-term debt Consolidated Balance Sheets (June 30, 2025 vs December 31, 2024) ($ in thousands) | Metric | June 30, 2025 | Dec 31, 2024 | Change | | :----------------------------------- | :-------------- | :------------- | :------- | | Total assets | $2,461,532 | $2,544,411 | -3.3% | | Cash and cash equivalents | $150,995 | $104,203 | +44.9% | | Accounts receivable, net | $358,756 | $414,681 | -13.5% | | Total current liabilities | $557,519 | $715,501 | -22.1% | | Long-term debt, net | $648,455 | $490,520 | +32.2% | | Total liabilities | $1,336,727 | $1,352,979 | -1.2% | | Total shareholders' equity | $896,005 | $1,001,259 | -10.5% | [Consolidated Statements of Cash Flows](index=8&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) For the six months ended June 30, 2025, Evolent Health reported net cash used in operating activities of $(25.8) million, a significant shift from cash provided in the prior year. Investing activities also used more cash, while financing activities provided a net cash inflow, leading to a slight net decrease in cash and restricted cash Consolidated Statements of Cash Flows (Six Months Ended June 30, 2025 vs 2024) ($ in thousands) | Metric | 2025 | 2024 | Change | | :--------------------------------------------------- | :--------- | :--------- | :------- | | Net cash and restricted cash (used in) provided by operating activities | $(25,769) | $26,326 | -197.9% | | Net cash and restricted cash used in investing activities | $(73,624) | $(23,273) | -216.3% | | Net cash and restricted cash provided by (used in) financing activities | $98,927 | $(88,499) | +211.7% | | Net (decrease) increase in cash and cash equivalents and restricted cash | $(526) | $(85,508) | +99.4% | | Cash and cash equivalents and restricted cash as of end-of-period | $177,970 | $137,949 | +29.0% | [Non-GAAP Reconciliations](index=13&type=section&id=Non-GAAP%20Reconciliations) This section provides detailed reconciliations of Evolent Health's GAAP to non-GAAP financial measures, including Adjusted Cost of Revenue, SG&A, EBITDA, and Adjusted Income (Loss) Attributable to Common Shareholders [Reconciliation of Adjusted Cost of Revenue](index=13&type=section&id=Reconciliation%20of%20Adjusted%20Cost%20of%20Revenue) For Q2 2025, Adjusted Cost of Revenue was $342.9 million, derived by subtracting $1.1 million in stock-based compensation from the GAAP Cost of Revenue of $343.9 million Reconciliation of Adjusted Cost of Revenue (Q2 2025 vs Q2 2024) ($ in thousands) | Metric | Q2 2025 | Q2 2024 | Change | | :-------------------------- | :-------- | :-------- | :------- | | Cost of revenue (GAAP) | $343,943 | $540,302 | -36.3% | | Less: Stock-based compensation | $1,050 | $1,207 | -13.0% | | Adjusted cost of revenue | $342,893 | $539,095 | -36.4% | [Reconciliation of Adjusted Selling, General and Administrative Expenses](index=13&type=section&id=Reconciliation%20of%20Adjusted%20Selling,%20General%20and%20Administrative%20Expenses) Adjusted Selling, General and Administrative Expenses for Q2 2025 totaled $63.9 million, after excluding $10.5 million in stock-based compensation, $0.8 million in severance costs, and other non-recurring items from the GAAP figure Reconciliation of Adjusted SG&A (Q2 2025 vs Q2 2024) ($ in thousands) | Metric | Q2 2025 | Q2 2024 | Change | | :--------------------------------------- | :-------- | :-------- | :------- | | Selling, general and administrative expenses (GAAP) | $75,209 | $69,185 | +8.7% | | Less: Stock-based compensation | $10,530 | $11,452 | -8.0% | | Less: Severance costs | $791 | $800 | -1.1% | | Less: Transaction-related costs | $0 | $163 | -100.0% | | Less: Repositioning costs | $0 | $670 | -100.0% | | Adjusted selling, general and administrative expenses | $63,888 | $56,100 | +13.9% | [Reconciliation of Adjusted EBITDA](index=14&type=section&id=Reconciliation%20of%20Adjusted%20EBITDA) Evolent's Adjusted EBITDA for Q2 2025 was $37.5 million, a decrease from $52.0 million in Q2 2024. This was calculated by adjusting the GAAP net loss attributable to common shareholders for various non-operating and non-cash items, including interest expense, depreciation and amortization, stock-based compensation, and dividends on Series A Preferred Stock Reconciliation of Adjusted EBITDA (Q2 2025 vs Q2 2024) ($ in thousands) | Metric | Q2 2025 | Q2 2024 | Change | | :--------------------------------------- | :-------- | :-------- | :------- | | Net loss attributable to common shareholders (GAAP) | $(51,090) | $(6,383) | -700.4% | | Interest expense | $11,601 | $5,995 | +93.5% | | Depreciation and amortization expenses | $23,141 | $29,870 | -22.6% | | Stock-based compensation expense | $11,580 | $12,659 | -8.5% | | Dividends and accretion of Series A Preferred Stock | $31,193 | $7,979 | +290.9% | | Adjusted EBITDA | $37,547 | $51,950 | -27.7% | | Adjusted EBITDA margin | 8.5% | 8.0% | +0.5 pp | [Reconciliation of Adjusted Income (Loss) Attributable to Common Shareholders](index=15&type=section&id=Reconciliation%20of%20Adjusted%20Income%20(Loss)%20Attributable%20to%20Common%20Shareholders) Evolent reported an Adjusted loss attributable to common shareholders of $(11.0) million for Q2 2025, a significant decline from an Adjusted income of $21.1 million in Q2 2024. This adjustment involved removing various non-GAAP items, including purchase accounting adjustments, stock-based compensation, and the tax impact of these adjustments Reconciliation of Adjusted Income (Loss) (Q2 2025 vs Q2 2024) ($ in thousands) | Metric | Q2 2025 | Q2 2024 | Change | | :--------------------------------------------------- | :-------- | :-------- | :------- | | Net loss attributable to common shareholders (GAAP) | $(51,090) | $(6,383) | -700.4% | | Purchase accounting adjustments | $13,364 | $17,189 | -22.2% | | Stock-based compensation expense | $11,580 | $12,659 | -8.5% | | Tax impact | $2,927 | $(5,600) | +152.3% | | Adjusted income (loss) attributable to common shareholders | $(11,013) | $21,065 | -152.3% | | Adjusted income (loss) per common share (Basic) | $(0.10) | $0.18 | -155.6% | [Forward-Looking Statements and Risk Factors](index=16&type=section&id=Forward-Looking%20Statements%20and%20Risk%20Factors) This section outlines cautionary language regarding forward-looking statements, detailing various risks and uncertainties that could materially impact Evolent Health's future performance [Forward-Looking Statements - Cautionary Language](index=16&type=section&id=Forward-Looking%20Statements%20-%20Cautionary%20Language) This section provides cautionary language regarding forward-looking statements, indicating that actual results may differ materially from expectations due to various risks and uncertainties. It outlines numerous factors that could impact future performance, including reliance on large partners, risk-sharing arrangements, ability to attract new partners, regulatory changes, data security, and the use of AI, advising investors not to place undue reliance on these statements - **Forward-looking statements** are predictions based on current expectations and projections about future events, subject to **risks and uncertainties** that may cause actual results to differ materially[47](index=47&type=chunk)[48](index=48&type=chunk) - **Significant portion of revenue derived from largest partners**, with potential for loss, termination, or renegotiation of contracts - **Increasing number of risk-sharing arrangements** and the ability to accurately predict exposure under performance-based contracts - **Ability to attract new partners** and offer new and innovative products and services, keeping pace with industry standards and technology - **Dependency on key personnel** and the ability to attract, hire, integrate, and retain them - **Risks related to completed and future acquisitions**, investments, alliances, and joint ventures, which could divert management resources or result in unanticipated costs - **Evolution of the healthcare regulatory and political framework**, restrictions on data access, and penalties from privacy and data protection laws - **Data loss or corruption due to system failures**, service disruptions, and liabilities related to safeguarding confidential data security and privacy - **Risks associated with the use of artificial intelligence (AI)** and machine learning models - **Ability to achieve profitability in the future** and the impact of additional goodwill and intangible asset impairments - **Indebtedness**, ability to service debt, and obtain additional financing on favorable terms - **Potential volatility of Class A common stock price** and provisions that discourage or prevent strategic transactions - **Impact of litigation proceedings**, government inquiries, public health emergencies, and increasing inflationary pressures[48](index=48&type=chunk)[51](index=51&type=chunk) - Investors should **not place undue reliance on forward-looking statements** as a prediction of actual results, and the company undertakes no obligation to publicly update them[50](index=50&type=chunk) ```