Oscar(OSCR) - 2025 Q2 - Quarterly Results

Preliminary Q2 2025 Financial Results and Revised 2025 Guidance 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 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] Drivers for Revised Guidance and Market Commentary 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] - The Company now expects a Medical Loss Ratio (MLR) of 86.0% to 87.0% for full year 2025[2] - 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] - The 2024 risk adjustment results were approximately $23 million favorable to the Company's accruals as of the first quarter of 2025[3] Revised Full Year 2025 Financial Outlook 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 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] - A conference call to review results will be hosted beginning at 8:00 AM (ET) on August 6, 2025[5] 2025 Financial Guidance Summary This section outlines Oscar Health's revised full year 2025 financial outlook and defines key performance metrics Full Year 2025 Outlook Table 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 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] - 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] - 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] - Loss from Operations: The Company's Total revenue less Total operating expenses; a metric for assessing operating performance[9] Non-GAAP Financial Information This section defines and explains the application of Adjusted EBITDA as a non-GAAP financial measure for performance evaluation Adjusted EBITDA Definition and Use 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] - Management believes Adjusted EBITDA enhances investors' understanding of performance and provides a reasonable basis for comparing ongoing results of operations[10] - 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] Cautionary Statements This section outlines disclaimers for forward-looking statements and the preliminary nature of financial disclosures Forward-Looking Statements 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] - 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][12] - 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] Financial Disclosure Advisory 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] - 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] About Oscar Health This section provides an overview of Oscar Health, a healthcare technology company focused on accessible and affordable solutions Company Overview 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] - 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] - Oscar served approximately 2.0 million members as of March 31, 2025[15] Contacts This section provides contact information for Oscar Health's investor and media relations departments Investor and Media Relations 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] - Media Contact: Kristen Prestano, VP of Communications, press@hioscar.com[16]