Evolent Health Q3 2024 Earnings Report
Key Takeaways
Evolent Health reported a 21.6% increase in revenue to $621.4 million for Q3 2024, driven by strong demand for its complex specialty care solutions and a record six new contract agreements. However, the company experienced a net loss of $(31.2) million, with Adjusted EBITDA negatively impacted by losses in the Performance Suite due to higher paid claims in prior periods and a spike in oncology costs.
Revenue increased by 21.6% to $621.4 million compared to Q3 2023.
Net loss attributable to common shareholders was $(31.2) million.
Adjusted EBITDA was $31.8 million, with a margin of 5.1%.
Announced a record six new contract agreements, including a major oncology Performance Suite agreement.
Evolent Health
Evolent Health
Forward Guidance
For Q4 2024, revenue is expected to be in the range of $642.0 million to $667.0 million, and Adjusted EBITDA is expected to be in the range of $22.0 million to $37.0 million. For the full year 2024, revenue is expected to be approximately $2.55 billion to $2.575 billion, and Adjusted EBITDA is expected to be approximately $160.0 million to $175.0 million.
Positive Outlook
- Revenue is expected to be in the range of $642.0 million to $667.0 million for Q4 2024.
- Adjusted EBITDA is expected to be in the range of $22.0 million to $37.0 million for Q4 2024.
- Full year 2024 revenue is expected to be approximately $2.55 billion to $2.575 billion.
- Full year 2024 Adjusted EBITDA is expected to be approximately $160.0 million to $175.0 million.
- Evolent continues to expect average annual revenue growth in excess of 15% and average Adjusted EBITDA growth of 20% on a long-term basis.
Challenges Ahead
- Adjusted EBITDA result was negatively impacted by losses in Performance Suite.
- Medical costs increased by $42 million in Q3 relative to expectations.
- No longer expects to exit 2024 at an Adjusted EBITDA run rate of $300 million.
- Significant shifts in medical expenses experienced in the managed care industry.
- Cannot provide guidance for the more significant reconciling items between net income (loss) attributable to common shareholders of Evolent Health, Inc. and Adjusted EBITDA without unreasonable effort.