Financial Data and Key Metrics Changes - Total revenue for Q2 2025 was reported at $2,900,000,000, representing a 29% increase year over year [7][18] - The medical loss ratio (MLR) increased by 12 points year over year to 91.1%, primarily due to an overall increase in average market morbidity [7][19] - The SG&A ratio improved by 90 basis points year over year to 18.7% [8][21] - The loss from operations was $230,000,000, a decrease of $298,000,000 year over year, while the adjusted EBITDA loss was $199,000,000 [8][22] - The company reaffirmed its 2025 guidance, projecting total revenue between $12,000,000,000 and $12,200,000,000 [8][24] Business Line Data and Key Metrics Changes - Membership grew to over 2,000,000, an increase of 28% year over year, driven by solid retention and above-market growth during open enrollment [19] - The second quarter MLR was impacted by a $316,000,000 increase in risk adjustment payable for 2025 due to higher ACA marketplace morbidity [19] Market Data and Key Metrics Changes - The latest risk adjustment data indicates a meaningful market-wide increase in morbidity in 2025, affecting all carriers with increases in mid to high single digits [9] - The company anticipates double-digit rate increases in the market for 2026 to address current morbidity pressures [10] Company Strategy and Development Direction - The company is focused on the individual market, believing it will stabilize in 2026 and is taking actions to mitigate current industry headwinds [8][12] - Oscar Health is acquiring early-stage assets to build a consumer marketplace, including a brokerage and a direct enrollment technology platform [13][14] - The company is launching a new ICRA product in partnership with Hy Vee Inc., targeting employers and employees in Des Moines, Iowa [15] Management's Comments on Operating Environment and Future Outlook - Management believes the individual market has significant long-term growth potential and is taking corrective actions to return to profitability in 2026 [16][27] - The company is confident in its capital position and expects to absorb the majority of forecasted losses through its excess capital [32][90] Other Important Information - The company is reducing its workforce in the second half of 2025, expecting to save approximately $60,000,000 in administrative costs for 2026 [12][27] - The company has a strong capital position with approximately $5,400,000,000 in cash and investments [22][90] Q&A Session Summary Question: Guidance on 2025 free cash flow and risk adjustment payable - Management confirmed a strong capital position and indicated that the majority of expected losses would be absorbed by excess capital [31] Question: Long-term targets for 2027 - Management reaffirmed the 5% margin target and stated that no changes to long-term forecasts are being made at this time [34] Question: Multiyear earnings levers - Management indicated that there are still opportunities to improve medical costs and administrative efficiencies [41] Question: Potential risk pool deterioration - Management expressed confidence that the risk pool would not deteriorate further and that they have factored risks into their pricing for 2026 [48] Question: Market stabilization assumptions for 2026 - Management stated that conservative assumptions have been built into the 2026 guidance, considering market morbidity shifts and program integrity impacts [52] Question: Membership shifts and retention - Management noted that improved membership retention and lower lapse rates contributed to membership growth, with no adverse selection observed [105]

Financial Data and Key Metrics Changes - Total revenue for the second quarter of 2025 was reported at $2,900,000,000, representing a 29% year-over-year increase [5][18] - The medical loss ratio (MLR) increased by 12 points year-over-year to 91.1%, primarily due to an overall increase in average market morbidity [5][19] - The SG&A ratio improved by 90 basis points year-over-year to 18.7% [6][21] - The loss from operations was $230,000,000, a decrease of $298,000,000 year-over-year, while the adjusted EBITDA loss was $199,000,000, a decrease of $34,000,000 year-over-year [6][22] - The company reaffirmed its updated 2025 guidance, projecting total revenues between $12,000,000,000 and $12,200,000,000 and a loss from operations between $200,000,000 and $300,000,000 [6][24] Business Line Data and Key Metrics Changes - Membership grew to over 2,000,000, an increase of 28% year-over-year, driven by solid retention and above-market growth during open enrollment [19] - The second quarter MLR was impacted by a $316,000,000 increase in risk adjustment payable for 2025 due to higher ACA marketplace morbidity [19] Market Data and Key Metrics Changes - The latest risk adjustment data indicated a meaningful market-wide increase in morbidity in 2025, affecting all carriers with increases in mid to high single digits [7] - The company expects double-digit rate increases in the market for 2026 to address current morbidity pressures [9] Company Strategy and Development Direction - The company is focused on managing expenses and optimizing operations through technology and AI-driven efficiencies, aiming to eliminate approximately $60,000,000 in administrative costs for 2026 [10][11] - Strategic acquisitions include an individual market brokerage and a direct enrollment technology platform to enhance capabilities in the consumer marketplace [12][13] - The company is launching a new ICRA product in partnership with Hy Vee Inc., targeting employers and employees in Des Moines, Iowa [14] Management's Comments on Operating Environment and Future Outlook - Management believes the individual market will stabilize in 2026 and expects to return to profitability in that year [15][26] - The company is taking corrective actions to ensure a strong position for profitability next year, despite current market challenges [18][26] Other Important Information - The company has a strong capital position with approximately $5,400,000,000 in cash and investments, including $579,000,000 in excess capital [22][90] - The company is reducing its workforce in the second half of 2025 to solidify its profitability position for 2026 [26][85] Q&A Session Summary Question: Guidance on 2025 free cash flow and risk adjustment payable - Management indicated a strong capital position and that the majority of expected losses would be absorbed by excess capital [30] Question: Long-term targets for 2027 - Management reaffirmed the 5% margin target but stated that adjustments may be made after assessing the pricing season [32] Question: Multiyear earnings levers - Management highlighted ongoing opportunities to improve medical costs and administrative efficiencies [38] Question: Potential risk pool deterioration - Management expressed confidence in their current position and noted that they have factored risks into their pricing for 2026 [47] Question: Market stabilization assumptions for 2026 - Management built conservative assumptions into their guidance, expecting to improve margins and return to profitability [51] Question: Membership shifts and retention - Management noted that improved membership retention and lower lapse rates contributed to membership growth [105]

Group 1: Company Performance - Oscar Health reported a second-quarter loss of $228 million, or 89 cents per share, marking a $285 million swing from a profit of $56.2 million, or 20 cents per share, in the same quarter last year [5] - Total membership increased by 28% to over 2 million, contributing to a 29% rise in total revenue, which reached nearly $2.9 billion in the second quarter [4] - The medical loss ratio surged to 91.1% in the second quarter, up from 79% in the previous year, indicating higher costs associated with a sicker patient pool [7] Group 2: Industry Context - The health insurance industry is facing challenges due to an influx of sicker-than-expected patients, leading to increased costs and lowered profit forecasts [5][6] - Rising costs in the health insurance sector are attributed to pent-up demand for healthcare following the COVID-19 pandemic, with many patients delaying treatment [6] - Health insurers, particularly those providing government-subsidized coverage, are planning to increase rates next year to manage the costs associated with a sicker patient demographic [5] Group 3: Future Outlook - Oscar's CEO, Mark Bertolini, remains optimistic about the individual health insurance market, believing it has long-term growth potential [8][9] - The company anticipates a market stabilization in 2026 and expects to return to profitability by that year [9] - Oscar is focused on building the individual market into a comprehensive healthcare marketplace for consumers and businesses [9]

[Preliminary Q2 2025 Financial Results and Revised 2025 Guidance](index=1&type=section&id=Preliminary%20Q2%202025%20Financial%20Results%20and%20Revised%202025%20Guidance) Oscar Health announced preliminary Q2 2025 financial results, revising full-year guidance due to higher ACA Marketplace risk scores and projected significant losses [Preliminary Q2 2025 Financial Highlights](index=1&type=section&id=Preliminary%20Q2%202025%20Financial%20Highlights) Oscar Health announced preliminary Q2 2025 financial results, expecting significant losses from operations and net loss, primarily due to an independent actuarial review of 2025 Marketplace data indicating higher-than-anticipated risk scores Preliminary Q2 2025 Financials | Metric | Amount (USD) | | :--- | :--- | | Loss from Operations | ~$230 million | | Net Loss | ~$228 million | - The preannouncement is driven by a review of 2025 Marketplace data ("2Q Risk Adjustment Reports") from Wakely, an independent actuarial firm, analyzing paid claims submissions through April 30, 2025[1](index=1&type=chunk) [Drivers for Revised Guidance and Market Commentary](index=1&type=section&id=Drivers%20for%20Revised%20Guidance%20and%20Market%20Commentary) The revision is driven by increased ACA Marketplace risk scores, indicating higher average morbidity. Oscar plans pricing actions for 2026 and will resubmit rate filings to reflect these higher market risk scores, while noting 2024 risk adjustment results were favorable - Overall ACA Marketplace risk scores have increased by more than the Company's prior estimates, based on the analysis of 2Q Risk Adjustment Reports covering nearly 100% of Oscar's geographic footprint[2](index=2&type=chunk) - The Company now expects a Medical Loss Ratio (MLR) of **86.0% to 87.0%** for full year 2025[2](index=2&type=chunk) - Oscar expects to resubmit rate filings for 2026 in states covering approximately **98% of current membership** to reflect the higher market risk scores in the ACA Marketplace[2](index=2&type=chunk) - The 2024 risk adjustment results were approximately **$23 million favorable** to the Company's accruals as of the first quarter of 2025[3](index=3&type=chunk) [Revised Full Year 2025 Financial Outlook](index=1&type=section&id=Revised%20Full%20Year%202025%20Financial%20Outlook) Oscar Health has revised its full year 2025 financial outlook, anticipating lower total revenue and higher loss from operations, alongside specific ranges for Medical Loss Ratio and SG&A Expense Ratio Revised Full Year 2025 Outlook | Metric | Low (USD) | High (USD) | | :--- | :--- | :--- | | Total Revenue | $12.0 billion | $12.2 billion | | Medical Loss Ratio | 86.0% | 87.0% | | SG&A Expense Ratio | 17.1% | 17.6% | | Loss from Operations | ($300 million) | ($200 million) | | Adjusted EBITDA Loss | ~$120 million less than Loss from Operations | [Upcoming Q2 2025 Earnings Release](index=1&type=section&id=Upcoming%20Q2%202025%20Earnings%20Release) The company expects to release its full second quarter 2025 financial results and host a conference call on August 6, 2025 - Q2 2025 financial results are expected to be released before the market opens on Wednesday, August 6, 2025[5](index=5&type=chunk) - A conference call to review results will be hosted beginning at 8:00 AM (ET) on August 6, 2025[5](index=5&type=chunk) [2025 Financial Guidance Summary](index=2&type=section&id=2025%20Financial%20Guidance%20Summary) This section outlines Oscar Health's revised full year 2025 financial outlook and defines key performance metrics [Full Year 2025 Outlook Table](index=2&type=section&id=Full%20Year%202025%20Outlook%20Table) This section provides a detailed table of Oscar Health's revised full year 2025 financial outlook, including ranges for Total Revenue, Medical Loss Ratio, SG&A Expense Ratio, and Loss from Operations Full Year 2025 Outlook | Metric | Low (USD) | High (USD) | | :--- | :--- | :--- | | Total Revenue | $12.0 billion | $12.2 billion | | Medical Loss Ratio | 86.0% | 87.0% | | SG&A Expense Ratio | 17.1% | 17.6% | | Loss from Operations | ($300 million) | ($200 million) | [Key Financial Metric Definitions](index=2&type=section&id=Key%20Financial%20Metric%20Definitions) This section defines the key financial metrics used in the guidance, including Total Revenue, Medical Loss Ratio (MLR), SG&A Expense Ratio, and Loss from Operations, explaining their significance for assessing business performance - **Total Revenue:** Includes Premium revenue, Investment income, and Services and other revenue; important for assessing business growth and investment portfolio earnings potential[7](index=7&type=chunk) - **Medical Loss Ratio (MLR):** Calculated as medical expenses as a percentage of net premiums before ceded quota share reinsurance; demonstrates the ratio of costs to pay for healthcare of members to net premiums[8](index=8&type=chunk) - **SG&A Expense Ratio:** Calculated as selling, general, and administrative expenses as a percentage of Total Revenue; valuable for evaluating the ability to manage the overall cost base[9](index=9&type=chunk) - **Loss from Operations:** The Company's Total revenue less Total operating expenses; a metric for assessing operating performance[9](index=9&type=chunk) [Non-GAAP Financial Information](index=2&type=section&id=Non-GAAP%20Financial%20Information) This section defines and explains the application of Adjusted EBITDA as a non-GAAP financial measure for performance evaluation [Adjusted EBITDA Definition and Use](index=2&type=section&id=Adjusted%20EBITDA%20Definition%20and%20Use) The company presents Adjusted EBITDA as a non-GAAP metric, defined as Net income (loss) adjusted for interest, taxes, depreciation, amortization, stock-based compensation, and other unusual items. It is used by analysts and management to evaluate performance, though comparability with other companies may vary - **Adjusted EBITDA Definition:** Net income (loss) before interest expense, income tax expense (benefit), and depreciation and amortization, further adjusted for stock-based compensation and other items considered unusual or not representative of underlying business trends[10](index=10&type=chunk) - Management believes Adjusted EBITDA enhances investors' understanding of performance and provides a reasonable basis for comparing ongoing results of operations[10](index=10&type=chunk) - Oscar has not provided a quantitative reconciliation of forecasted Adjusted EBITDA to forecasted GAAP net income (loss) due to the inability to calculate certain reconciling items (e.g., stock-based compensation) without unreasonable efforts[10](index=10&type=chunk) [Cautionary Statements](index=2&type=section&id=Cautionary%20Statements) This section outlines disclaimers for forward-looking statements and the preliminary nature of financial disclosures [Forward-Looking Statements](index=2&type=section&id=Forward-Looking%20Statements) This section warns that the press release contains forward-looking statements regarding future performance, financial outlook, and business strategy, which are subject to significant risks, assumptions, and uncertainties beyond the company's control - Statements regarding preliminary Q2 2025 results, financial outlook, estimates, underlying assumptions, planned rate filings, business prospects, market dynamics, and management plans are considered forward-looking statements[11](index=11&type=chunk) - Future performance is not guaranteed and is subject to risks, assumptions, and uncertainties, including the ability to execute strategy, manage growth, retain members, accurately estimate medical expenses, maintain profitability, and adapt to regulatory changes[11](index=11&type=chunk)[12](index=12&type=chunk) - Readers are cautioned not to place undue reliance on any forward-looking statements, and the company does not undertake any obligation to publicly update or review them, except as required by law[13](index=13&type=chunk) [Financial Disclosure Advisory](index=3&type=section&id=Financial%20Disclosure%20Advisory) All financial data presented in the release is preliminary and subject to change as quarter-end accounting procedures are not yet complete, meaning actual results may differ - All financial data in this press release is preliminary and represents the most current information available, as financial closing procedures for the quarter ended June 30, 2025, are not yet complete[14](index=14&type=chunk) - Actual results may differ from these estimates due to the completion of normal quarter-end accounting procedures and adjustments, as well as the preparation and review of financial statements[14](index=14&type=chunk) [About Oscar Health](index=4&type=section&id=About%20Oscar%20Health) This section provides an overview of Oscar Health, a healthcare technology company focused on accessible and affordable solutions [Company Overview](index=4&type=section&id=Company%20Overview) Oscar Health is a leading healthcare technology company founded in 2012, focused on making healthcare accessible and affordable through its full-stack technology platform. It offers Individual & Family plans and health technology solutions, serving approximately 2.0 million members as of March 31, 2025 - Oscar Health, Inc. is a leading healthcare technology company built around a full stack technology platform[15](index=15&type=chunk) - The company is dedicated to making a healthier life accessible and affordable for all, offering Individual & Family plans and health technology solutions through +Oscar[15](index=15&type=chunk) - Oscar served approximately **2.0 million members** as of March 31, 2025[15](index=15&type=chunk) [Contacts](index=4&type=section&id=Contacts) This section provides contact information for Oscar Health's investor and media relations departments [Investor and Media Relations](index=4&type=section&id=Investor%20and%20Media%20Relations) This section provides contact information for Oscar Health's Investor Relations and Media Relations departments - Investor Contact: Chris Potochar, VP of Investor Relations, ir@hioscar.com[16](index=16&type=chunk) - Media Contact: Kristen Prestano, VP of Communications, press@hioscar.com[16](index=16&type=chunk)

Company Overview - Oscar Health (NYSE: OSCR) is a technology-driven health insurance company focused on individual and family health plans under the Affordable Care Act (ACA) [1] Business Model - Oscar Health operates differently from traditional insurance companies, leveraging artificial intelligence to enhance its services [1] Market Position - The company is positioned within the ACA landscape, indicating a focus on providing health insurance solutions that comply with regulatory requirements [1]

Group 1 - Oscar Health (NYSE: OSCR) is gaining attention as a rising health insurer, with upcoming Q2 results expected to reveal its plans following the One Big Beautiful Bill and the uncertain environment [1] - The analysis focuses on value investing, emphasizing an owner's mindset and a long-term horizon, indicating a strategic approach to investment rather than short-term speculation [1] Group 2 - There are no disclosed positions in Oscar Health or related derivatives, and no plans to initiate any positions in the near future, suggesting a neutral stance on immediate investment opportunities [2] - The article expresses personal opinions and does not provide compensation for the analysis, indicating an independent viewpoint [2]

Core Insights - Oscar Health's stock has decreased by 40% from its recent highs, but investors are advised not to panic [1] Company Summary - The video discusses the current stock performance of Oscar Health (OSCR), emphasizing that the significant drop should not cause alarm among investors [1]

Group 1 - Oscar Health, Inc. (OSCR) stock closed at $15.53, down 3.42% from the previous day, underperforming the S&P 500's gain of 0.28% [1] - The stock has increased by 13.64% over the past month, outperforming the Finance sector's gain of 2.79% and the S&P 500's gain of 4.37% [1] Group 2 - Oscar Health, Inc. is expected to report an EPS of $0.34, reflecting a 70% increase from the same quarter last year, with revenue forecasted at $2.86 billion, indicating a 28.96% growth [2] - For the fiscal year, earnings are projected at $0.61 per share and revenue at $11.21 billion, representing increases of 510% and 22.12% respectively from the prior year [3] Group 3 - Recent analyst estimate revisions for Oscar Health, Inc. indicate positive sentiment regarding the company's business operations and profit generation capabilities [4] - The Zacks Rank system, which evaluates estimate changes, currently ranks Oscar Health, Inc. at 3 (Hold), with the consensus EPS projection remaining unchanged over the past 30 days [6] Group 4 - Oscar Health, Inc. has a Forward P/E ratio of 26.22, significantly higher than the industry average of 10.14, suggesting the company is trading at a premium [7] - The Insurance - Multi line industry, part of the Finance sector, holds a Zacks Industry Rank of 65, placing it in the top 27% of over 250 industries [7]

Core Viewpoint - Oscar Health, Inc. is expected to show significant growth in its upcoming financial results, with strong projections for earnings and revenue compared to the previous year [2][3]. Financial Performance - The stock closed at $16.55, down 1.55% from the previous trading session, underperforming the S&P 500's daily loss of 0.07% [1] - Over the past month, the stock has increased by 13.89%, outperforming the Finance sector's gain of 2.38% and the S&P 500's gain of 3.94% [1]. Earnings Estimates - The upcoming EPS is predicted to be $0.34, reflecting a 70% growth year-over-year [2]. - For the full year, analysts expect earnings of $0.61 per share, marking a 510% increase from last year [3]. Revenue Projections - The Zacks Consensus Estimate for revenue in the upcoming quarter is $2.86 billion, which is a 28.96% increase from the same period last year [2]. - For the full year, revenue is projected to be $11.21 billion, indicating a 22.12% increase from the previous year [3]. Analyst Sentiment - Recent changes in analyst estimates suggest a positive outlook for the company's business and profitability [4]. - The Zacks Rank system indicates a current rank of 3 (Hold) for Oscar Health, with a recent downward shift of 11.11% in the EPS estimate [6]. Valuation Metrics - Oscar Health is currently trading at a Forward P/E ratio of 27.41, which is significantly higher than the industry average of 9.99 [7]. - The Insurance - Multi line industry, part of the Finance sector, has a Zacks Industry Rank of 145, placing it in the bottom 42% of over 250 industries [7].

Group 1: Core Insights - Centene's recent developments have negatively impacted the ACA sector, causing Oscar Health's stock to drop by approximately 15-20% due to concerns over higher-than-expected claims risk [1] - Despite the selloff, Oscar Health reported record Q1 results with a 42% revenue growth and an expanding membership base, indicating strong operational performance [1] Group 2: Investment Methodology - The investment strategy focuses on identifying high-conviction opportunities through leadership and management analysis, market disruption, financial health, and valuation metrics [1] - Key factors include proven track records in scaling businesses, smart capital allocation, sustainable revenue growth, and strong balance sheets [1] - The portfolio construction emphasizes core positions, growth bets, and speculative investments to balance risk and reward [1]