Evolent Announces Third Quarter 2024 Results

Core Insights - Evolent Health, Inc. reported a revenue of $621.4 million for the quarter ended September 30, 2024, representing an increase of $110.4 million or 21.6% compared to the same period in 2023 [1][4][7] - The company experienced a net loss attributable to common shareholders of $(31.2) million, with a net loss margin of (5.0)%, an improvement from (6.5)% in the previous year [1][4][7] - Adjusted EBITDA for the quarter was $31.8 million, resulting in an Adjusted EBITDA margin of 5.1%, down from 9.5% in the same quarter of 2023 [1][4][7] - Evolent announced six new contract agreements during the quarter, marking the highest number of new agreements in a single quarter in the company's history [5][11] Financial Performance - Revenue for the quarter was $621.4 million, up from $511.0 million in the same quarter of 2023 [4][7] - Cost of revenue increased to $540.7 million from $386.6 million year-over-year [7][22] - Selling, general and administrative expenses decreased to $67.1 million from $96.6 million in the prior year [7][22] - Adjusted income attributable to common shareholders was $4.7 million, compared to $20.0 million in the same quarter of 2023 [8][41] Business Outlook - The company revised its outlook for Adjusted EBITDA for 2024, expecting it to be in the range of $160.0 million to $175.0 million for the full year [11][12] - Evolent continues to anticipate average annual revenue growth exceeding 15% and average Adjusted EBITDA growth of 20% on a long-term basis [12][11] - The company is taking aggressive actions to improve profitability, particularly in response to rising medical costs and losses in its Performance Suite [3][4] New Contracts and Market Position - The six new agreements include significant partnerships with major payers and health plans, indicating strong demand for Evolent's solutions in managing complex health conditions [5][11] - The company noted a $42 million increase in medical costs in the third quarter, attributed to new data and an industry-wide spike in oncology costs [3][4] - Evolent's diversified business is performing at or better than expectations, despite challenges in the Performance Suite [3][4]