Executive Summary

Q3 revenue accelerated to $136.6M (+36.7% y/y, +14.0% q/q), driven by 57% y/y growth in Pharmacy and 13% y/y Fee-for-Service; gross profit rose 31.7% to $18.9M though gross margin ticked down 50 bps y/y to 13.9% due to a one-time $1.8M FFS bad-debt reserve recorded in the quarter .
Adjusted EBITDA improved to $(3.5)M from $(8.2)M y/y and from $(4.1)M in Q2; management achieved the first adjusted EBITDA-positive month in September and reiterated Q4 adjusted EBITDA of ~$0 to $2M .
FY25 guidance raised on revenue (to $495–$505M) and tightened for adjusted EBITDA (to $(11)–$(13)M); gross profit and FCF guidance maintained; company also expects Q4 free cash flow to be positive (not yet at run-rate) .
Execution catalysts: Florida delegated capitation expansion (Elevance MA lives >2x in <1 year), MSO network >200 providers, Florida pharmacy opening, and AI-enabled prior auth automation (>80% time reduction; potential ~$2M OpEx savings in 2026) .

What Went Well and What Went Wrong

What Went Well
- Pharmacy momentum: $75.9M revenue (+57% y/y) and $12.8M gross profit, with gross margin ~16.9% stable; record fill volumes and improved script attachment .
- Value-based care scaling: Strong MLR performance in Florida delegated model, additional MA lives coming in Q4 (more than doubling Elevance lives y/y), MSO network >200 providers .
- AI enablement: Prior authorization submission time cut from ~18 minutes to ~5 seconds; potential to save >80% per auth and up to ~$2M OpEx in 2026; first deployment live in 8 weeks with Ascertain .
- Quote: “We achieved adjusted EBITDA profitability for our first month… in September… which allowed us to increase our outlook for 2025.” – CEO .
What Went Wrong
- Margin headwind: Reported gross margin 13.9% (vs 14.4% y/y; 14.6% in Q2) impacted by a one-time $1.8M FFS bad-debt reserve; normalized gross profit would have been $20.7M (15.2% margin) .
- Non-cash drag from derivatives: Large q/q increase in conversion option derivative fair value (+$6.0M in Q3, +$13.3M YTD) weighed on GAAP net loss .
- Cyber vendor incident: Temporary billing disruption at a third-party vendor affects timing of FFS collections into late Q4/early Q1, though patient volumes remained intact .

Financial Results

Metric	Q3 2024	Q2 2025	Q3 2025
Revenue ($M)	$99.9	$119.8	$136.6
Gross Profit ($M)	$14.4	$17.5	$18.9
Gross Margin %	14.4%	14.6%	13.9%
Net Loss ($M)	$(16.1)	$(17.0)	$(16.5)
Diluted EPS ($)	$(0.18)	$(0.15)	$(0.14)
Adjusted EBITDA ($M)	$(8.2)	$(4.1)	$(3.5)

Segment revenue breakdown

Segment Revenue ($M)	Q3 2024	Q2 2025	Q3 2025
Patient Services	$49.8	$55.9	$60.2
Dispensary	$48.2	$62.6	$75.9
Clinical Trials & Other	$1.9	$1.3	$0.5

Key performance indicators (Q3 2025 unless noted)

KPI	Q3 2024	Q3 2025
Clinics	86	80
Markets	14	22
Lives under value-based contracts (M)	1.9	1.9
Cash & Cash Equivalents ($M)	—	$27.7
Long-term Debt, net ($M)	—	$76.2
Pharmacy Gross Profit ($M)	—	$12.8
Pharmacy Gross Margin %	—	16.9%
Patient Services Gross Profit ($M)	—	$5.6
Patient Services Gross Margin %	—	9.3%

Notes: One-time $1.8M FFS reserve reduced Q3 reported revenue/gross profit; normalized gross profit $20.7M and margin 15.2% .

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Revenue	FY 2025	$460–$480M	$495–$505M	Raised
Gross Profit	FY 2025	$73–$82M	$73–$82M	Maintained
Adjusted EBITDA	FY 2025	$(8)–$(17)M	$(11)–$(13)M	Tightened (midpoint ~unchanged)
Free Cash Flow	FY 2025	$(12)–$(21)M	$(12)–$(21)M	Maintained
Adjusted EBITDA	Q4 2025	—	~$0–$2M	New/affirmed

Context: Management reiterated Q4 adjusted EBITDA positivity and expects Q4 free cash flow to be positive (not yet run-rate) .

Earnings Call Themes & Trends

Topic	Previous Mentions (Q1 & Q2 2025)	Current Period (Q3 2025)	Trend
AI/Technology initiatives	Announced AI pilots in revenue cycle, prior auth, call center; one-time rebate aided margins; SG&A discipline	Prior auth automation cut submission time to ~5 seconds; 80%+ savings per auth; ~$2M 2026 OpEx savings potential; live deployment in 8 weeks with Ascertain	Accelerating deployment and quantified savings
Pharmacy performance	Q1: $49.3M, >$9M GP; Q2: $62.6M, >$11M GP; margin tailwind from improved procurement; DIR transition lapped	$75.9M revenue (+57% y/y), $12.8M GP; margin ~16.9% flat y/y; strong script attachment	Continued strong growth
Delegated capitation/MLR	Q1: Launched FL delegated model; Q2: additional contracts/lives; cap margins ramp over time	40k initial FL MA lives performing well; expanding Elevance MA coverage in Central FL (>2x lives in <1yr); overall MLR stable despite rapid growth	Scaling with stable MLR
Regulatory/macro (IRA, PA)	IRA likely net positive; tariffs monitored; DIR fee impact behind	Payer prior auth reductions seen as neutral-to-positive; trend to lower drug costs viewed favorably	Supportive
Cybersecurity/vendor risk	—	Third-party billing platform incident affected FFS billing timeliness; collections timing shifts to late Q4/early Q1; operations unaffected	New headwind (timing only)
Clinical trials	Outsourced to Helios; one-time write-off in Q2; deconsolidation reduces revenue	Segment minimal in Q3 ($0.5M)	De-emphasized
Radiopharma (Pluvicto)	—	Certified; adoption growing; small absolute numbers; community setting advantage; potential expansion	Early traction

Management Commentary

“We had a solid third quarter across all lines of our business… These were just some of the factors that allowed us to increase our full-year guidance and reaffirm our positive outlook for Q4 adjusted EBITDA.” – CEO Daniel Virnich .
“Adjusted EBITDA loss of $3.5 million in Q3 represents a $4.7 million improvement… We are reinforcing our expectation to achieve profitability in the fourth quarter and become free cash flow positive in 2026.” – CEO .
“Pharmacy revenue was $75.9 million… gross margin of 16.9%… We recorded a $1.8 million [FFS] reserve… Normalized gross profit would have been $20.7 million (15.2% gross margin).” – CFO Rob Carter .
“We are raising revenue outlook to $495–$505 million and tightening adjusted EBITDA to a loss of $11–$13 million… implying adjusted EBITDA between break-even and +$2 million for the fourth quarter.” – CFO .

Q&A Highlights

One-time reserve: $1.8M FFS reserve reduced Q3 results; fully included in adjusted EBITDA .
Profitability cadence: September was the first adjusted EBITDA-positive month; management expects Q4 adjusted EBITDA ~breakeven to +$2M and Q4 FCF positive (not run-rate) .
MLR and PMPM: Overall MLR in high 60s; delegated model mid-70s but larger TAM and GP dollars; contracts typically have annual PMPM escalators; MLR stable despite growth .
Pharmacy growth drivers: Reduced leakage and higher attachment; not expecting the same sequential growth rate into Q4 .
Pipeline/2026: Expect 20%+ top-line growth, subtle gross margin improvement, and flat SG&A % of revenue; additional $10–$15M remaining from 2025-signed deals into 2026 .

Estimates Context

Wall Street consensus from S&P Global was unavailable for Q3 2025 and forward quarters at the time of analysis. As a result, we cannot present a vs-consensus comparison for revenue, EPS, or EBITDA for Q3 2025 or near-term periods (values not returned by S&P Global).
Implications: Management’s FY25 revenue raise and Q4 adjusted EBITDA guide (~$0–$2M) provide the comparison anchor; normalized Q3 gross margin (15.2%) excluding the reserve suggests underlying momentum into Q4 .

Key Takeaways for Investors

Momentum broad-based: Pharmacy strength and FFS growth in FL/OR lifted revenue to $136.6M (+36.7% y/y), with adjusted EBITDA tracking to Q4 breakeven/positive, a critical inflection for the equity story .
Delegated risk scaling: Florida delegated model evidences stable MLR and growing MA lives (Elevance expansion) with MSO leverage; expect continued capitation growth and margin maturation as patients transition to in-network care .
AI as a structural cost lever: Prior auth automation at scale offers tangible OpEx reduction (>80% per auth; ~$2M 2026 savings potential) and operating leverage as volumes grow .
Transient Q3 headwinds: A conservative $1.8M FFS reserve and a vendor cyber incident shifted some collections timing; underlying gross margin normalized to ~15.2% absent the reserve, supporting Q4 guide .
Liquidity and working capital: Cash ended at $27.7M; the ATM provided ~$11.3M in Q3 and enabled profitable end-of-quarter buy-ins; convertible debt ~$86M outstanding (2027 maturity) .
2025 setup: Guidance raised to $495–$505M revenue and tightened for adjusted EBITDA $(11)–$(13)M, with Q4 EBITDA $0–$2M and positive FCF (not yet run-rate) .
Medium-term: Management targets 20%+ revenue growth in 2026 with modest margin improvement and flat SG&A %; FCF-positive mid-2026 reinforces a durable profitability trajectory .

Appendix: Additional Relevant Press Releases (Q3 timing)

Ascertain partnership: Co-developing agentic-AI “near-touchless” prior auth; first deployment live in 8 weeks; >80% submission time reduction and potential ~$2M 2026 OpEx savings .
Q3 earnings call schedule: Company announced Nov 13 date post-close, with replay details .

Potential stock reaction catalysts: Confirmation of Q4 adjusted EBITDA/FCF inflection; continued pharmacy outperformance; additional delegated capitation wins or geographic expansions; visible AI-driven OpEx reductions scaling in 2026 .

All figures are from company filings and transcripts as cited. No S&P Global consensus data was returned for estimate comparisons.

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