Stonegate Capital Partners Updates Coverage on GoHealth Inc. (GOCO) 2025 Q3November 17, 2025 9:52 AM EST | Source: Reportable, Inc. Dallas, Texas--(Newsfile Corp. - November 17, 2025) - GoHealth Inc. (NASDAQ: GOCO): Stonegate Capital Partners updates their coverage on GoHealth Inc. (NASDAQ: GOCO). GoHealth, Inc. reported a difficult 3Q25 as the Company continued to navigate a materially different Medicare Advantage environment. Net revenues declined to $34.2M from $118.3M a year ago, reflectin ...

Financial Data and Key Metrics Changes - GoHealth reported a cash balance of approximately $32 million at the end of Q3 2025, with access to an additional $40 million from a new super-priority term loan facility [44][47]. - The company emphasized cash management and maintaining liquidity to support operations and strategic opportunities [45][48]. Business Line Data and Key Metrics Changes - The company shifted focus from Medicare Advantage (MA) to GoHealth Protect, prioritizing retention and stable member profiles over volume growth due to tightening health plan economics [5][9]. - GoHealth Protect has been instrumental in retaining business, with a strategy to enhance consumer peace of mind through complementary product offerings [19][20]. Market Data and Key Metrics Changes - The Medicare Advantage market is experiencing strong demand, but health plans are prioritizing retention and stable member profiles rather than broad expansion [5][9]. - The total available non-special needs plan products are declining for 2026, while special needs plan options are increasing, indicating a shift in industry priorities [9]. Company Strategy and Development Direction - The company is focusing on quality over quantity, retention over short-term submissions, and cash preservation to maintain strategic flexibility [7][8]. - GoHealth aims to lead consolidation in a fragmented broker landscape, leveraging its strong balance sheet and governance structure to create long-term value [10][11]. Management's Comments on Operating Environment and Future Outlook - Management believes that the current actions taken by health plans are justified and prudent, reflecting a focus on retention and quality [6][9]. - The company expects the Medicare Advantage market to stabilize over the next 12-24 months, allowing for potential revenue growth with improved margins and cash profiles [12][17]. Other Important Information - GoHealth has retained its highest-quality agents and adjusted compensation structures to reinforce retention strategies [8][53]. - The company has invested in AI and automation to improve agent effectiveness and consumer experience [8][58]. Q&A Session Summary Question: What is the growth trajectory for Medicare Advantage over the next 12 to 24 months? - Management indicated that growth will depend on health plans stabilizing their cost structures and focusing on retention, with expectations for a return to growth as the market rationalizes [15][17]. Question: Can you discuss the key drivers of growth for GoHealth Protect? - The growth of GoHealth Protect is driven by enhancing consumer peace of mind and serving both existing and new customers effectively [19][20]. Question: Why did the company decide to pull back on Medicare Advantage? - The decision was based on feedback from health plans prioritizing retention and stability over new enrollments, as well as the need to focus on existing members [25][26]. Question: What are the implications of the company's current strategy if the market conditions change? - If the assessment proves correct, the company retains its capabilities and cash position, but if wrong, it may need to ramp up operations quickly [28][30]. Question: Why should the industry consolidate, and how is GoHealth positioned to lead? - The company believes that consolidation can reduce duplicative costs and enhance efficiency, positioning GoHealth as a leader due to its strong consumer base and technology investments [31][32].

Core Insights - GoHealth, Inc. has intentionally reduced its Medicare Advantage volume to adapt to a changing market that prioritizes retention and member stability over raw enrollment growth [2][3][6] - The company's third-quarter performance reflects a disciplined approach, maintaining liquidity and reducing fixed costs while focusing on platform efficiency and strategic flexibility [3][6] Financial Performance - For the three months ended September 30, 2025, GoHealth reported net revenues of $34.186 million, a decrease of 71.1% from $118.292 million in the same period of 2024 [16] - Operating expenses for the same period totaled $322.103 million, a significant increase of 100.1% compared to $160.964 million in 2024, leading to a loss from operations of $287.917 million [16][18] - The net loss attributable to GoHealth, Inc. for the three months ended September 30, 2025, was $165.846 million, compared to a net income of $6.775 million in the same period of 2024 [18] Strategic Focus - The company is emphasizing a retention-first strategy, reinforcing objective guidance to members and protecting the quality of its member base [6][3] - GoHealth aims to maintain its leadership in Special Needs Plans (SNP) and has preserved strategic capabilities to scale when market conditions stabilize [6][2] Market Environment - The Medicare Advantage environment has shifted towards margin integrity and long-term member value, prompting GoHealth to align its operating model accordingly [2][3] - Health plans are increasingly prioritizing renewal stability and member quality, which has influenced GoHealth's decision to reduce its Medicare Advantage volume [2][6] Operational Metrics - The number of submissions for the three months ended September 30, 2025, was 72,183, a decrease of 56.6% from 166,195 in the same period of 2024 [27] - Sales per submission decreased to $461 in the third quarter of 2025, down 34.3% from $702 in the same quarter of 2024 [27]

Company Performance - GoHealth Inc. reported a challenging second quarter in 2025, with net revenues decreasing by 11.2% year-over-year to $94.0 million, primarily due to a significant drop in partner revenue by 44.4% and non-agency revenue by 79.4% [1] - The overall revenue decline was partially offset by a strong increase in other revenues, particularly from GoHealth Protect [1] - The company experienced a net loss of $115.9 million in Q2, which was impacted by a $53 million intangible asset impairment charge; however, adjusted EBITDA improved slightly year-over-year to -$11.3 million [7] Strategic Initiatives - Management indicated a focus on adapting to market conditions and capitalizing on opportunities as they arise, particularly in light of the upcoming Annual Enrollment Period (AEP) [1] - The company secured $115 million in new and rolled-up loans and amended its credit agreement to waive near-term principal payments, creating a $250 million debt basket for pursuing strategic deals [7] Cost Management - Marketing and consumer care expenses were reduced by 26% and 33% year-over-year, respectively, leading to improved cost efficiency per submission despite a 7.5% decline in total submissions [7]

Company Overview - GoHealth is a leading health insurance marketplace providing personalized guidance to Medicare-eligible consumers[12] - GoHealth has assisted over 11 million consumers with Medicare plan options[15] - The Medicare market is large and growing, with over 68 million eligible lives and over 11,000 new members each day[18] Business Model and Technology - GoHealth utilizes a consumer-centric approach and streamlined Encompass operating model[22] - The company's PlanFit technology platform optimizes enrollment and ensures the best outcomes for consumers[14] - GoHealth's differentiated operating model results in industry-leading customer acquisition costs, with Direct Operating Cost per Submission at $578 in FY24[51, 52] Market Position and Growth - GoHealth is ranked 1 Medicare enroller for health plans[25] - The company projects over 40 million Medicare Advantage enrollees by 2030[55] Competitive Advantage - GoHealth's Direct Operating Cost per Submission is 17% to 31% lower than peers in FY24[51]

Core Insights - GoHealth Inc. (NASDAQ: GOCO) reported a strong performance in Q1 2025, with net revenues increasing by 19.1% year-over-year to $221.0 million, driven by a significant rise in submissions [1][7] - The company achieved an operating income of $6.7 million, a notable improvement from the previous year's loss, and Adj. EBITDA grew by 56.4% to $45.1 million, highlighting operational efficiencies [1][7] - GoHealth's growth is attributed to its leadership in the Medicare-focused digital health marketplace, supported by strategic investments in technology and operational excellence [1] Financial Performance - Q1 2025 net revenues reached $221.0 million, up from $185.6 million in the same period last year, reflecting a 19.1% increase [7] - The number of submissions in Q1 2025 was 303,026, representing a 40.2% increase compared to 216,148 submissions in Q1 2024 [7] - The company launched GoHealth Protect during the quarter, indicating a focus on innovation and market expansion [7]

Core Insights - GoHealth, Inc. reported strong financial results for Q1 2025, highlighting significant growth in revenue and improved operational metrics [1][3][6] - The company launched GoHealth Protect, expanding its product offerings to include guaranteed acceptance life insurance, aiming to enhance customer relationships and unit economics [3][6] Financial Performance - Q1 2025 net revenues reached $221.0 million, a 19.1% increase from $185.6 million in Q1 2024 [6][19] - The net loss for Q1 2025 was $9.8 million, showing a 54.2% improvement compared to a net loss of $21.3 million in the prior year [6][19] - Adjusted EBITDA for Q1 2025 was $42.1 million, a 56.4% increase from $26.9 million in Q1 2024 [6][19] - The number of submissions increased to 303,026, a 40.2% rise from 216,148 submissions in the same period last year [6][26] Operational Metrics - Direct Operating Cost per Submission improved to $522, an 18.4% decrease from $640 in Q1 2024 [6][26] - The company reported a total operating expense of $214.3 million, a 13.0% increase from $189.6 million in the prior year [19] - The Adjusted EBITDA Margin for Q1 2025 was 19.0%, compared to 14.5% in Q1 2024 [20][19] Product Development - The launch of GoHealth Protect aims to diversify the company's offerings and improve customer engagement [3][6] - The new product suite is expected to enhance cash flow generation and reduce customer acquisition costs as it scales [3][6]