Summary of DocGo (DCGO) FY Conference Call - August 26, 2025 Company Overview - **Company Name**: DocGo (DCGO) - **Industry**: Mobile health services and integrated medical mobility solutions - **Core Business**: Provides last mile mobile health services, medical transport, and care in the home [1][4] Key Points and Arguments Investment Thesis - DocGo is positioned as a leading provider of tech-driven mobile care, with a strong balance sheet and a large total addressable market (TAM) [4][6] - The company aims to deliver healthcare at any address, moving care outside traditional hospital settings [6][7] Business Segments - **Medical Transport**: The foundation of the business, expanding with a focus on non-emergency medical transport [5][43] - **Mobile Health**: Rapidly growing segment providing care in the home, with a broad range of services [5][31] Financial Performance - Revenue for Q2 was approximately $80.4 million, slightly above consensus, with a gross margin of 31.5% [16] - The company has collected about 98% of receivables from New York City and State for migrant services, improving cash flow [14][15] - Book value per share is increasing, and the company is trading at a significant discount to its book value [12][13] Market Dynamics - The U.S. healthcare system spends significantly on treating chronic diseases, with 90% of $4.5 trillion spent on chronic conditions and mental health [21][22] - DocGo aims to assist payers and providers in preventing chronic issues by offering tailored solutions [22][23] Growth Opportunities - The number of patients assigned for care gap closure is projected to exceed 1 million, with a significant increase in completed visits expected [53][54] - The company is focusing on expanding partnerships with health plans and hospital systems to enhance service delivery [62] Competitive Advantages - DocGo has a proprietary logistics platform that allows efficient routing and service delivery, creating a competitive moat [34][60] - The company has vertical integration, combining technology, staffing, and clinical services, which is rare in the industry [58][65] Management and Strategy - The management team includes experienced professionals from various sectors, enhancing operational capabilities [66] - Future M&A activities will focus on filling gaps in service offerings rather than simply acquiring revenue [62] Important but Overlooked Content - The company has pruned underperforming markets to focus on scalable opportunities, which may lead to higher growth rates than previously indicated [52] - The emphasis on care gap closure and mobile health services is critical for improving patient outcomes and reducing overall healthcare costs [40][41] Conclusion - DocGo is strategically positioned in a fragmented healthcare market with a strong focus on mobile health and medical transport services, backed by a solid financial foundation and growth potential through innovative solutions and partnerships [63][66]

Financial Data and Key Metrics Changes - Total revenue for Q1 2025 was $96 million, down from $192.1 million in Q1 2024, primarily due to the decline in the government vertical, especially in migrant-related projects [18] - The company recorded a net loss of $11.1 million in Q1 2025 compared to a net income of $10.6 million in Q1 2024, reflecting the drop in revenues [19] - Adjusted EBITDA for Q1 2025 was a loss of $3.9 million, down from adjusted EBITDA of $24.1 million in Q1 2024 [20] - SG&A as a percentage of total revenues was 46.7% in Q1 2025, compared to 26.8% in Q1 2024, indicating a significant increase due to the decline in migrant revenues [23] Business Line Data and Key Metrics Changes - Mobile health revenue for Q1 2025 was $45.2 million, down from $143.9 million in Q1 2024, driven by the anticipated wind down of migrant revenues [19] - Medical transportation services revenue increased to $50.8 million in Q1 2025 from $48.2 million in Q1 2024, supported by growth in several markets [19] - The medical transportation business is expected to generate $225 million in revenue for 2025, while the payer and provider business is projected to generate $50 million [17] Market Data and Key Metrics Changes - The company has seen growth in medical transportation services in markets including Delaware, Tennessee, Pennsylvania, New Jersey, Wisconsin, Upstate New York, and the UK [19] - The payer and provider vertical has exceeded 900,000 assigned lives, up from 700,000 just a quarter ago, indicating strong demand [10] Company Strategy and Development Direction - The company has removed its government population health vertical from its 2025 guidance due to ongoing policy changes and budget cuts, leading to substantial uncertainty [5][7] - The focus is on building the company around innovative solutions for payers, providers, and health systems, particularly in mobile health and medical transportation [8] - The company is undertaking cost-cutting measures while investing in growing segments, aiming for positive adjusted EBITDA in 2026 [15][16] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the growth trajectory of the medical transportation and payer/provider verticals despite the challenges in the government sector [8][17] - The anticipated adjusted EBITDA loss for 2025 is primarily due to elevated SG&A levels during the transition period [15] - Management highlighted the importance of patient satisfaction and the positive impact of their services on healthcare outcomes, which is expected to drive future growth [40][70] Other Important Information - The company plans to report any significant non-migrant municipal work as upside revenue in future quarters [17] - The balance sheet remains healthy, with expectations of positive cash flow from operations despite projected losses [16][25] - The company has initiated a stock buyback program, repurchasing nearly 2 million shares for approximately $5.8 million [26] Q&A Session Summary Question: What is the expected government revenue for the remainder of the year? - Management clarified that government population health revenues have been removed from guidance, and any new deployments will be reported separately as upside [30][31] Question: How is the payer business performing? - The payer business is experiencing healthy demand, with plans focused on reducing medical loss ratios and improving quality metrics [38][40] Question: What caused the revenue miss in Q1? - The revenue miss was attributed to the government vertical, with delays in contract launches and RFP responses impacting expected revenues [46][51] Question: What is the margin profile of the migrant-related revenue? - The margin for the migrant program was about 34%, consistent with previous quarters, while the non-migrant mobile health segment had higher margins [75] Question: Are there risks from tariffs on medical equipment? - Management indicated that tariffs could impact the cost of maintaining the fleet and procuring new vehicles, but they are well-positioned to manage these costs [77][78]

Financial Data and Key Metrics Changes - Total revenue for Q1 2025 was $96 million, down from $192.1 million in Q1 2024, primarily due to the decline in the government vertical, especially in migrant-related projects [20][21] - The company recorded a net loss of $11.1 million in Q1 2025 compared to a net income of $10.6 million in Q1 2024, reflecting the drop in revenues [21] - Adjusted EBITDA for Q1 2025 was a loss of $3.9 million, down from an adjusted EBITDA of $24.1 million in Q1 2024 [22] Business Line Data and Key Metrics Changes - Mobile health revenue for Q1 2025 was $45.2 million, down from $143.9 million in Q1 2024, driven by the anticipated wind down of migrant revenues [21] - Medical transportation services revenue increased to $50.8 million in Q1 2025 from $48.2 million in Q1 2024, supported by growth in several markets [21] - The medical transportation business is expected to have adjusted EBITDA of greater than $15 million in 2025, with a projected total of approximately 575,000 transports by the end of 2025 [11][19] Market Data and Key Metrics Changes - The company has seen substantial growth in its payer and provider vertical, exceeding 900,000 assigned lives, up from 700,000 just a quarter ago [12] - The number of care gap closure and transitional care management visits is projected to grow from over 4,400 in Q4 2024 to over 11,500 in Q4 2025, indicating a significant expansion [13] Company Strategy and Development Direction - The company has removed its government population health vertical from its 2025 guidance due to ongoing policy changes and budget cuts, leading to substantial uncertainty [7][9] - The focus is on building the company around innovative solutions for payers, providers, and health systems, particularly in mobile health and medical transportation [10] - Cost-cutting measures have been initiated, with SG&A reduced by approximately $3.1 million sequentially in Q1 2025, while still investing in growth areas [17][18] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the growth trajectory of the medical transportation and payer/provider verticals, despite the challenges in the government sector [10][19] - The company anticipates positive cash flow from operations and expects to exit the year with over $110 million in cash, despite projecting a consolidated adjusted EBITDA loss for the year [18][27] Other Important Information - The company has initiated a stock buyback program, repurchasing nearly 2 million shares for approximately $5.8 million in Q1 2025 [28] - The balance sheet remains healthy, with expectations for improved cash flow from operations as accounts receivable from migrant programs are collected [27] Q&A Session Summary Question: What is the expected government revenue for the remainder of the year? - Management clarified that government population health revenues have been removed from guidance, and any new deployments will be reported separately as upside [32][33] Question: How is the company balancing SG&A cuts with staffing for future government engagements? - Management is restructuring shared services for savings while reinvesting in growing parts of the business to ensure readiness for future growth [34][35] Question: What is the margin profile of the migrant-related revenue compared to core business? - The margins on the migrant program were about 34%, while the non-migrant mobile health segment had a gross margin of 35.9% in Q4 2024 [80] Question: Are there any risks from tariffs on medical equipment? - Management indicated that tariffs could impact the cost of maintaining the fleet and procuring new vehicles, but they are in a good position to manage these costs [81][82]

Financial Data and Key Metrics Changes - Total revenue for Q1 2025 was $96 million, down from $192.1 million in Q1 2024, primarily due to the decline in the government vertical, especially in migrant-related projects [19] - The company recorded a net loss of $11.1 million in Q1 2025 compared to a net income of $10.6 million in Q1 2024 [20] - Adjusted EBITDA for Q1 2025 was a loss of $3.9 million, down from an adjusted EBITDA of $24.1 million in Q1 2024 [21] - The adjusted gross margin for Q1 2025 was 32.1%, compared to 35% in Q1 2024 [21] Business Line Data and Key Metrics Changes - Mobile health revenue for Q1 2025 was $45.2 million, down from $143.9 million in Q1 2024, driven by the anticipated wind down of migrant revenues [20] - Medical transportation services revenue increased to $50.8 million in Q1 2025 from $48.2 million in Q1 2024, supported by growth in several markets [20] - The medical transportation business is expected to have an adjusted EBITDA of greater than $15 million in 2025, with projected total transports reaching approximately 575,000 by the end of 2025 [10] Market Data and Key Metrics Changes - The company has seen substantial growth in its payer and provider vertical, exceeding 900,000 assigned lives, up from 700,000 just a quarter ago [11] - The number of care gap closure and transitional care management visits is projected to grow from approximately 4,400 in Q4 2024 to over 11,500 in Q4 2025 [12] Company Strategy and Development Direction - The company has removed its government population health vertical from its 2025 guidance due to ongoing policy changes and budget cuts, leading to substantial uncertainty [6] - The focus is on building the company around innovative solutions for payers, providers, and health systems, particularly in mobile health and medical transportation [9] - Cost-cutting measures have been initiated, with SG&A reduced by approximately $3.1 million sequentially in Q1 2025, while the company plans to aggressively cut SG&A over the next several quarters [17] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the growth trajectory of the medical transportation and payer/provider verticals despite the challenges in the government sector [9] - The company anticipates positive cash flow from operations and expects to exit the year with over $110 million in cash, despite projecting a consolidated adjusted EBITDA loss for the year [17] - Management highlighted the importance of their technology platform in securing new contracts and improving patient outcomes [11] Other Important Information - The company has initiated a stock buyback program, repurchasing nearly 2 million shares for approximately $5.8 million in Q1 2025 [27] - The balance sheet remains healthy, with expectations for improved cash flow from operations as accounts receivable from migrant programs are collected [26] Q&A Session Summary Question: What is the expected government revenue for the remainder of the year? - Management clarified that government population health revenues have been removed from guidance, and any new deployments will be reported separately as upside [31][32] Question: How is the company balancing SG&A cuts with staffing for future government engagements? - Management indicated they are restructuring shared services for savings while reinvesting in growing parts of the business to prepare for future growth [33][34] Question: What is the demand outlook for the payer business? - Management noted healthy demand in the payer segment, with proactive healthcare services aimed at reducing medical loss ratios and improving quality metrics [39][41] Question: What caused the revenue miss in Q1? - The revenue miss was attributed to the government vertical, with delays in contract launches and RFP responses impacting expected revenues [48][55] Question: What is the margin profile of the migrant-related revenue? - The margins on the migrant program were about 34%, consistent with previous quarters, while the non-migrant mobile health segment had higher margins [78] Question: Are there risks from tariffs on medical equipment? - Management acknowledged potential tariff impacts on fleet procurement and maintenance but expressed confidence in their fleet management capabilities [80]

Financial Data and Key Metrics Changes - Total revenue for Q4 2024 was $120.8 million, a 39% decrease from $199.2 million in Q4 2023 [32] - For the full year, revenues were $616.6 million in 2024, down 1% from 2023 [34] - Net loss for Q4 2024 was $7.6 million, compared to net income of $8 million in Q4 2023 [35] - Adjusted EBITDA for Q4 2024 was $1.1 million, down from $22.6 million in Q4 2023 [35] - Adjusted EBITDA margin for the full year of 2024 was 9.8%, up from 8.6% in 2023 [36] Business Line Data and Key Metrics Changes - Mobile Health revenue for Q4 2024 was $71.8 million, down 52% from Q4 2023 [34] - Medical transportation revenue increased to $49.1 million in Q4 2024, up about 1% from Q4 2023 [34] - Transportation revenues for 2024 were 7% higher than in 2023, with a compound annual growth rate of 32% over the past three years [34] Market Data and Key Metrics Changes - The company provided services across 31 states in the U.S. and the UK, with significant expansions in New York and California [13] - The company anticipates a significant cash flow tailwind through mid-2025 from accounts receivable totaling approximately $150 million related to migrant programs [22] Company Strategy and Development Direction - The company aims to build a 100-year company that transforms healthcare delivery and brings high-quality, accessible care to all [10] - Investments are being made in technology, personnel, and infrastructure to support growth in customer verticals [11][39] - The company acquired PTI Health, a mobile phlebotomy company, to expand its service offerings [20] Management's Comments on Operating Environment and Future Outlook - Management acknowledged a near-term impact on profitability due to aggressive investments but remains optimistic about future growth opportunities [10][27] - The company expects to maintain gross margins while anticipating EBITDA margins in the mid-single digits for 2025 [46] - Management noted a robust pipeline of deals, with expectations for significant revenue growth in the base business [54][100] Other Important Information - The company received over 40,000 job applications from healthcare clinicians and corporate staff in the past year, indicating strong interest in its mission [14] - The company’s net promoter score for its care gap closure program was above 86, indicating high customer satisfaction [14] Q&A Session Summary Question: What is the 2025 revenue guidance? - Management indicated that the base business is expected to grow faster in 2025, with potential for migrant-related revenues to be below the previously estimated $50 million [50][51] Question: What are the details of the $17 million investments? - Investments are focused on technology, personnel training, and business development to support growth in the care gap closure business [58][60] Question: What was the migrant revenue in Q4 and the full year? - Migrant revenues in Q4 were approximately $55 million, with total annual revenues around $370 million [84] Question: How will the company manage unanticipated expenses? - Management noted that being self-insured introduces some uncertainty, but they are working to improve reserving practices to mitigate future fluctuations [72][75] Question: What is the outlook for the municipal business? - The company is progressing with its Project Prime initiative and expects to see contracts with existing service providers for municipal entities [121]