Oscar Health Earnings Call Transcripts
Fiscal Year 2026
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After a challenging 2025, proactive planning and strategic plan design led to strong 2026 enrollment and improved retention, with pricing and risk management reflecting lessons learned. Regulatory changes and integrity measures are expected to further stabilize the market.
Fiscal Year 2025
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Revenue grew 28% to $11.7B in 2025, but higher market morbidity led to a $443M net loss. Membership surged to 3.4M, with 2026 guidance projecting a return to profitability, 61% revenue growth, and improved margins.
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Panelists discussed persistent healthcare cost growth, the need for better consumer incentives, and the promise of AI and personalization to simplify choices and improve outcomes. Policy changes, industry collaboration, and expanded access to financial tools like HSAs and ICHRAs were highlighted as key levers for future cost control and consumer empowerment.
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Guidance for 2025 is based on stable market morbidity and proactive cost management, with competitive pricing and expansion into new markets. The company is prepared for a 20-30% market contraction if enhanced subsidies expire, but sees strong capital flexibility and growth opportunities, especially in ICRA.
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Q3 2025 revenue rose 23% year-over-year to $3 billion, with membership up 28%. MLR increased to 88.5% due to higher morbidity, but SG&A ratio improved. Full-year guidance was reaffirmed, with disciplined pricing and cost actions positioning for margin expansion and profitability in 2026.
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Utilization trends have stabilized, with modest membership losses and positive market morbidity impacts. MLR seasonality is expected to normalize, and pricing for 2026 reflects stacked risks and regulatory changes. Capital and liquidity remain strong, while ICHRA and technology initiatives support long-term growth.
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Second quarter revenue grew 29% year-over-year to $2.9 billion, but higher market morbidity drove MLR up to 91.1% and resulted in a $230 million operating loss. Guidance for 2025 is reaffirmed, with profitability expected to return in 2026 and significant cost reductions planned.
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First-quarter 2025 saw 42% revenue growth to $3B and net income of $275M, driven by strong membership gains and operational efficiency. Guidance for 2025 is reaffirmed, with continued focus on margin expansion and digital innovation.
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Management highlighted record profitability in 2024, strong ACA market growth, and a positive outlook for ICHRA as a future catalyst. Regulatory changes are improving market integrity, while investments in AI and digital processes aim to boost efficiency and margins.
Fiscal Year 2024
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Record 2024 results included $9.2B revenue (+57% YoY), $199M Adjusted EBITDA, and $25M net income. 2025 guidance projects $11.2–$11.3B revenue, margin expansion, and positive net income, with strong membership retention and operational efficiency gains.
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Third quarter results showed 68% year-over-year growth in both revenue and membership, with strong adjusted EBITDA and net income improvements. Full-year guidance was raised, and new products and market expansions are expected to drive continued double-digit growth and margin expansion.
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Strong core business and SEP growth have led to updated guidance and a larger membership base for 2024. SEP members initially have higher MLRs, but retention drives improved profitability in 2025. Long-term targets include 20% revenue CAGR and a 5% EBIT margin, with opportunities in ICHRA and further SG&A efficiency.
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Management projects over 20% CAGR through 2027, driven by disciplined pricing, market expansion, and product innovation, with significant opportunities in ICHRA and state-based exchanges. AI is enhancing efficiency, and capital is being strategically allocated for growth.
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Strong core performance and disciplined pricing support reaffirmed guidance and long-term targets. SEP growth brings short-term margin pressure but is expected to drive 2025 gains. Market expansion, regulatory stability, and ICHRA present future growth opportunities.
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Q2 2024 saw 46% revenue growth and a 63% membership increase, with improved profitability and a raised full-year outlook. SEP member growth drove guidance changes, and the company remains confident in achieving long-term targets, supported by strong capital and expanding market opportunities.
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A dynamic three-year plan targets 20% revenue CAGR and 5% operating margin by 2027, driven by ACA and ICHRA market expansion, technology-enabled efficiency, and innovative products. Technology and AI are central to cost control and member experience, while capital allocation supports organic growth and flexibility.