Q2 2026 Privia Health Group Inc Earnings Call

August 6, 2026

Operator: Thank you for standing by. Welcome to Privia Health's Q2 2026 earnings conference call. Currently, all participants are in a listen-only mode. After the speaker's presentation, there will be a question-and-answer session. To ask a question during the session, you will need to press star one one on your telephone. To remove yourself from the queue, you may press star one one again.

Speaker #1: After the speaker's presentation, there will be a question-and-answer session. To ask a question during the session, you will need to press *11 on your telephone to remove yourself from the queue.

Speaker #1: You may press *11 again. I would now like to hand the call over to Robert Borchert, SVP of Investor and Corporate Communications. Please go ahead.

Operator: I would now like to hand the call over to Robert Borchert, SVP of Investor and Corporate Communications. Please go ahead.

Speaker #2: Thank you, Latif. Joining me are our CEO, Parth Mehrotra, and David Mountcastle, our Chief Financial Officer. This call is being webcast and can be accessed in the Investor Relations section of PriviaHealth.com, along with today's press release and slide presentation.

Robert Borchert: Thank you, Lateef. Joining me are our CEO, Parth Mehrotra, and David Mountcastle, our Chief Financial Officer. This call is being webcast and can be accessed in the investor relations section of priviahealth.com, along with today's press release and slide presentation. Following our prepared comments, we will open the line for questions. Please limit yourself to one question only and return to the queue if you have a follow-up so we can get to as many questions as possible.

Speaker #2: Following our prepared comments, we will open the line for questions. Please limit yourself to one question only, and return to the queue if you have a follow-up, so we can get to as many questions as possible.

Speaker #2: Today's reported results are preliminary and are not final until our Form 10-Q for the second quarter and six-month period ended June 30, 2026, is filed with the Securities and Exchange Commission.

Robert Borchert: Today's reported results are preliminary and are not final until our Form 10-Q for the Q2 and six-month periods ended 30 June 2026 is filed with the Securities and Exchange Commission. Some of our statements today may be forward-looking in nature, based on our current expectations and view our business as of 6 August 2026.

Speaker #2: Some of our statements today may be forward-looking in nature based on our current expectations and view of our business as of August 6, 2026.

Speaker #2: Statements such as those related to our performance and future business plans and future financial and operating objectives are subject to risk and uncertainties that may cause actual results to differ materially.

Robert Borchert: Statements such as those related to our future financial and operating performance and future business plans and objectives are subject to risks and uncertainties that may cause actual results to differ materially. These statements should be considered along with the cautionary statements in today's press release and the risk factors described in our most recent SEC filings. Finally, we may refer to certain non-GAAP financial measures on the call.

Speaker #2: Cautionary statements in today's press release and the risk factors described in our most recent SEC filings should be considered along with these statements. Finally, we may refer to certain non-GAAP financial measures on the call.

Speaker #2: Reconciliation of these measures to comparable GAAP measures are included in our press release and the accompanying slide presentation posted on our website. Now I'd like to turn the call over to our CEO, Parth Mehrotra.

Robert Borchert: Reconciliation of these measures to comparable GAAP measures are included in our press release and accompanying slide presentation posted on our website. Now, I'd like to turn the call over to our CEO, Parth Mehrotra.

Speaker #3: Thank you, Robert, and good morning, everyone. Today, I'll summarize our performance and market presence, and David will discuss our financial results and updated 2026 guidance before we take your questions.

Parth Mehrotra: Thank you, Robert, and good morning, everyone. Today, I will summarize our performance and market presence. David will discuss our financial results and updated 2026 guidance before we take your questions. Privia Health has continued to execute at a very high level across all aspects of our business. We delivered strong new provider signings across all our markets, which provides excellent visibility through 2026 and into next year.

Speaker #3: Privia Health has continued to execute at a very high level across all aspects of our business. We delivered strong new provider signings across all our markets.

Speaker #3: Which provides excellent visibility through 2026 and into next year. Implemented provider growth of 10.1% and value-based attributed lives growth of 19.2% year over year helped drive total practice collections growth of 12.4% in the second quarter.

Parth Mehrotra: Implemented provider growth of 10.1% and value-based attributed lives growth of 19.2% year over year helped drive total practice collections growth of 12.4% in Q2. Adjusted EBITDA increased 29%, with EBITDA margin as a percentage of care margin expanding 310 basis points from a year ago.

Speaker #3: Adjusted EBITDA increased 29%, with EBITDA margin as a percentage of care margin expanding 310 basis points from a year ago. We are continuing our journey to deploy AI applications in various workflows across the organization and expect to continue to expand our EBITDA margin towards the high end of our long-term target range of 30 to 35 percent of care margin over the next few years.

Parth Mehrotra: We are continuing our journey to deploy AI applications in various workflows across the organization and expect to continue to expand our EBITDA margin towards the high end of our long-term target range of 30% to 35% of care margin over the next few years. In late May, we announced entry into the state of New Jersey in partnership with Neurology Group of Bergen County, a practice with 25 adult and pediatric clinicians. This represents Privia's 25th state as we build our national primary care-centric delivery network.

Speaker #3: In late May, we announced entry into the state of New Jersey in partnership with a neurology group of 25 adult and pediatric clinicians. This represents Privia's 25th state, as we build our national primary care-centric delivery network.

Speaker #3: We raised our 2026 outlook across all key financial metrics, including practice collections, care margin, and EBITDA, given our strong first-half performance. Attributed lives is above the high end of prior guidance.

Parth Mehrotra: We raised our 2026 outlook across all key financial metrics, including practice collections, care margin, and EBITDA, given our strong H1 performance. Attributed lives is above the high end of prior guidance. Our implemented provider guidance is unchanged. We would add 570 providers at the midpoint of our 2026 guidance, which is 10.6% growth over 2025.

Speaker #3: Our implemented provider guidance is unchanged. We would add 570 providers at the midpoint of our 2026 guidance, which is 10.6% growth over 2025. The Privia Health footprint of community-based medical groups and value-based risk-bearing entities continues to expand.

Parth Mehrotra: The Privia Health footprint of community-based medical groups and value-based risk-bearing entities continues to expand. We now have 5,644 implemented providers caring for over 6.1 million patients in more than 1,300 care center locations operating across 25 states and the District of Columbia. A defining component of Privia's operating model is our gross provider retention averaging 98% over the past three years.

Speaker #3: We now have 5,644 implemented providers caring for over 6.1 million patients, in more than 1,300 care center locations, operating across 25 states and the District of Columbia.

Speaker #3: A defining component of Privia's operating model is our gross provider retention averaging 98% over the past 3 years. We serve over 1.64 million attributed lives, across more than 130 commercial and government value-based care programs.

Parth Mehrotra: We serve over 1.64 million attributed lives across more than 130 commercial and government value-based care programs. Commercial attributed lives increased 11.7% from last year to reach 942,000. Lives attributed to the CMS Medicare programs were up 55%. Medicare Advantage and Medicaid attribution increased more than 12% and 18%, respectively.

Speaker #3: Commercial attributed lives increased 11.7% from last year to reach 942,000. Lives attributed to the CMS Medicare programs were up 55%. Medicare Advantage and Medicaid attribution increased more than 12% and 18% respectively.

Speaker #3: The diversification of Privia's value-based care contracts gives us the confidence in our ability to build scale and profitability without depending on any one particular program.

Parth Mehrotra: The diversification of Privia's value-based care contracts gives us the confidence in our ability to build scale and profitability without depending on any one particular program. Slide seven shows the scale and breadth of Privia's ACOs.

Speaker #3: Slide 7 shows the scale and breadth of Privia's ACOs. We manage and estimated 15.7 billion in total medical spend across all commercial and government value-based risk arrangements.

Parth Mehrotra: We manage an estimated $15.7 billion in total medical spend across all commercial and government value-based risk arrangements. This $15.7 billion estimate captures the full scope of our value-based programs relative to our fee-for-service collections. It more accurately represents the breadth of total medical spend our clinicians are able to potentially impact over time.

Speaker #3: This $15.7 billion estimate captures the full scope of our value-based programs relative to our fee-for-service collections. It more accurately represents the breadth of total medical spend our clinicians are able to potentially impact over time.

Speaker #3: We remain highly focused on increasing attribution and generating positive contribution margin across our value-based book. Our ultimate goal is to achieve consistent and sustainable earnings growth for our physician partners and shareholders.

Parth Mehrotra: We remain highly focused on increasing attribution and generating positive contribution margin across our value-based book. Our ultimate goal is to achieve consistent and sustainable earnings growth for our physician partners and shareholders. David will now review our recent financial results, balance sheet strength, and our updated 2026 guidance in more detail.

Speaker #3: David will now review our recent financial results, balance sheet strength, and our updated 2026 guidance in more detail.

Speaker #1: Thank you, Parth. Privia Health's strong operational execution and growth continued through the second 109 sequentially from Q1 to June 30. An increase of 10.1% year over year.

David Mountcastle: Thank you, Parth. Privia Health's strong operational execution and growth continued through Q2. Implemented providers grew 109 sequentially from Q1 to reach 5,644 at 30 June. That is an increase of 10.1% year over year. Implemented provider growth, as well as strong ambulatory utilization trends and value-based performance led to practice collections growing 12.4% from a year ago to reach $970 million.

Speaker #1: Implemented provider growth, as well as strong ambulatory utilization trends and value-based performance, led to practice collections growing 12.4% from a year ago to reach 970 million.

Speaker #1: Adjusted EBITDA, which is reconciled to GAAP net income in the appendix, increased 29% over the second quarter last year to reach 37.4 million. Representing 28.3% of care margin.

David Mountcastle: Adjusted EBITDA, which is reconciled to GAAP net income in the appendix, increased 29% over Q2 last year to reach $37.4 million, representing 28.3% of care margin. This is a 310 basis point margin improvement as we generated operating leverage across both cost of platform and G&A while investing across all markets. For H1 2026, practice collections increased 13.4% to $1.88 billion, care margin was up 18.3%, and adjusted EBITDA grew 32.5% to reach $74.1 million.

Speaker #1: This is a 310 basis point margin improvement as we generated operating leverage across both cost of platform and GNA while investing across all markets.

Speaker #1: For the first half of 2026, practice collections increased 13.4% to 1.88 billion, care margin was up 18.3%, and adjusted EBITDA grew 32.5% to reach 74.1 million.

Speaker #1: We ended the second quarter with more than 412 million in cash and no debt. As we mentioned previously, beginning this year, Privia is now a full cash taxpayer.

David Mountcastle: We ended Q2 with more than $412 million in cash and no debt. As we mentioned previously, beginning this year, Privia is now a full cash taxpayer. Given the timing of cash tax payments and provider disbursements, we expect 70% to 80% of our full-year adjusted EBITDA to convert to free cash flow. This does not include any capital deployments in year for business development and assumes we will receive a significant portion of our shared savings cash payments for 2025 performance by year end.

Speaker #1: Given the timing of cash tax payments and provider disbursements, we expect 70 to 80 percent of our full-year adjusted EBITDA to convert to free cash flow.

Speaker #1: This does not include any capital deployments in year for business development and assumes we will receive a significant portion of our shared savings. Cash payments for 2025 performance by year-end.

Speaker #1: Last month, CMS announced certain proposed changes that would be retroactively applied to the Medicare shared savings program for performance year 2025 to finalize. To allow for the implementation of these changes, CMS may delay delivery of the final reconciliation results for performance year 2025 until November.

David Mountcastle: Last month, CMS announced certain proposed changes that would be retroactively applied to the Medicare Shared Savings Program for performance year 2025 if finalized. To allow for the implementation of these changes, CMS may delay delivery of the final reconciliation results for performance year 2025 until November.

Speaker #1: While this has minimal impact on our accruals, it may lead to an atypical year-end cash flow dynamic. Depending on when we receive the cash settlement from CMS, as well as our subsequent payments to the providers.

David Mountcastle: While this has minimal impact on our accruals, it may lead to an atypical year-end cash flow dynamic, depending on when we receive the cash settlement from CMS, as well as our subsequent payments to the providers. Our healthy balance sheet continues to position us with significant financial flexibility to deploy capital and take advantage of opportunities in the current market environment. Our H1 results gives us confidence to raise our 2026 outlook above the high end of our prior guidance range for attributed lives, to the high end of our ranges for practice collections and GAAP revenue, and to the mid to high end of our ranges for care margin, platform contribution and EBITDA. Our guidance for implemented providers is unchanged. We also continue to maintain a robust pipeline of existing market expansion and potential new market opportunities.

Speaker #1: Our healthy balance sheet continues to position us with significant financial flexibility to deploy capital and take advantage of opportunities in the current market environment.

Speaker #1: Our first half results gives us confidence to raise our 2026 outlook above the high end of our prior guidance range for attributed lives, to the high end of our ranges for practice collections and GAAP revenue, and to admit to high end of our ranges for care margin platform contribution and EBITDA.

David Mountcastle: Our H1 results gives us confidence to raise our 2026 outlook above the high end of our prior guidance range for attributed lives, to the high end of our ranges for practice collections and GAAP revenue, and to the mid to high end of our ranges for care margin, platform contribution and EBITDA. Our guidance for implemented providers is unchanged. We also continue to maintain a robust pipeline of existing market expansion and potential new market opportunities.

Speaker #1: Our guidance for implemented providers is unchanged. We also continue to maintain a robust pipeline of existing market expansion and potential new market opportunities. As a reminder, our guidance does not assume any additional business development activity.

David Mountcastle: As a reminder, our guidance does not assume any additional business development activity. Over the last nine years, Privia's consistent growth and profitability across cycles is the ultimate proof of our consistent execution, the strength of our differentiated business, and the compounding of our economic model year after year. We are confident that our integrated model, combining medical groups, risk-bearing entities, and tech and services platforms, will continue to drive sustainable growth and profitability for years to come. As Privia continues to build large-scale primary care centric delivery networks across the nation, we would like to thank all our clinicians and employees for their continued partnership, dedication, and hard work to help us achieve these results. Operator, we are now ready to take questions.

Speaker #1: Over the last 9 years, Privia's consistent growth and profitability across cycles is the ultimate proof of our consistent execution, the strength of our differentiated business, and the compounding of our economic model year after year.

Speaker #1: We are confident that our integrated model, combining medical groups, risk-bearing entities, and tech and services platforms, will continue to drive sustainable growth and profitability for years to come.

David Mountcastle: We are confident that our integrated model, combining medical groups, risk-bearing entities, and tech and services platforms, will continue to drive sustainable growth and profitability for years to come. As Privia continues to build large-scale primary care centric delivery networks across the nation, we would like to thank all our clinicians and employees for their continued partnership, dedication, and hard work to help us achieve these results. Operator, we are now ready to take questions.

Speaker #1: As Privia continues to build large-scale primary care-centric delivery networks across the nation, we would like to thank all our clinicians and employees for their continued partnership, dedication, and hard work to help us achieve these results.

Speaker #1: Operator, we are now ready to take questions.

Speaker #2: As a reminder to ask a question, you will need to press star 11 on your telephone to remove yourself from the queue. You may press star 11 again.

Operator: As a reminder, to ask a question, you will need to press *11 on your telephone. To remove yourself from the queue, you may press *11 again. Please stand by while we compile the Q&A roster. Our first question comes from the line of Elizabeth Anderson of Evercore ISI. Please go ahead, Elizabeth.

Speaker #2: Please stand by while we compile the Q&A roster. Our first question. Come from the line of Elizabeth Anderson of Evercore ISI. Please go ahead, Elizabeth.

Elizabeth Anderson: Hi, guys. Good morning. Thanks so much for the question. Maybe just could we double click on your question about the CMS shared savings payment being delayed? I guess, obviously, out of your control as that's a government function, but I guess what gives you confidence that it is going to come in Q4? How should we think about sort of external signposts we can watch to monitor that?

Speaker #4: Hi, guys. Good morning. Thanks so much for the question. Maybe just could we double-click on your question about the CMS shared savings payment being delayed?

Speaker #4: I guess, obviously, out of your controls is that's a government function, but I guess, what gives you confidence that it is going to come in the fourth quarter?

Speaker #4: And how should we think about sort of external signposts we can watch to monitor that?

Speaker #3: Yeah, I mean, we're not that worried about it. They've been really good over the past many years. It usually results come in August, September.

David Mountcastle: Yeah, we're not that worried about it. They've been really good over the past many years. It usually, results come in August, September. The cash settlement happens sometime October.

Parth Mehrotra: Yeah, we're not that worried about it. They've been really good over the past many years. It usually, results come in August, September. The cash settlement happens sometime October.

Speaker #3: The cash settlement happens sometime October. So it's delayed by, call it, 30 to 45 days. I think it's in their interest to make sure all the providers are getting the cash flow as they deserve for a good performance here.

Parth Mehrotra: It's delayed by, call it, 30 to 45 days. I think it's in their interest to make sure all the providers are getting the cash flow as they deserve for a good performance here. I just think the changes that they've proposed are positive in general. I just think they need a little bit more time to reconcile it, but we don't see any issues in receiving the money. I think whether it comes early November or late November, December, it'll happen when it happens, but I don't think it's a big concern for us.

Speaker #3: I just think the changes that they've proposed are positive. In general, so I just think they need a little bit more time to reconcile it, but we don't see any issues in receiving the money.

Speaker #3: I think whether it comes early November, late November, December, I mean, that's just it'll happen when it'll happen, but I don't think it's a big concern for us.

Operator: Thank you. Our next question comes from the line of Ryan Daniels of William Blair. Your question please, Ryan.

Speaker #2: Thank you. Our next question. Comes from the line of Ryan Daniels of William Blair. Your question, please, Ryan.

Speaker #5: Yeah, hello. This is Matthew Mordula on for Ryan Daniels. Thank you for taking the questions. So in your prepared remarks, you talked about being towards the high end of your long-term target range of 30% to 35% for the care margin over the next few years.

Matthew Mardula: Yeah. Hello, this is Matthew Mardula on for Ryan Daniels. Thank you for taking the question. In your prepared remarks, you talked about being towards the high end of your long-term target range of 30% to 35% for the care margin over the next few years. Can you give us some color on what has changed to give you confidence of being at the high end for your long-term target, as well as the drivers of what will help you get to that target? Then any directional timeline on when this could be achieved? Is it maybe in the next few years or more of a longer-term target of five years or more?

Speaker #5: Can you give us some color on what has changed to give you confidence of being at the high end for your long-term target as well as the drivers of what will help you get to that target?

Speaker #5: And then any directional timeline on when this could be achieved is it maybe in the next few years or more of a longer-term target of 5 years away?

Matthew Mardula: Then any directional timeline on when this could be achieved? Is it maybe in the next few years or more of a longer-term target of five years or more?

Parth Mehrotra: Yeah, thanks for the question, Matt. We covered this a little bit last quarter as well. If you see our guidance, we expect to be 29% this year, EBITDA to care margin. It's pretty much very close to the 30%. Given all the work we are doing with different AI applications, with just scaling our business with growth, I think we're pretty confident that we can keep accreting that. There's no set timeline. We said over the next few years. It can ebb and flow, but I think we'll just keep accreting it, and we actually feel really good about it because this was a target we had set when we went public at our IPO about five years ago. We're already there at the low end.

Speaker #3: Yeah, thanks for the question, Matt. So I mean, we've covered this a little bit last quarter as well. I mean, if you see our guidance, we expect to be 29% this year.

Speaker #3: EBITDA to care margin. So it's pretty much very close to the 30%. And given all the work we are doing with different AI applications, with just scaling our business with growth, I think we're pretty confident that we can keep accreting that.

Speaker #3: There's no set timeline. I mean, we said over the next few years, it can ebb and flow, but I think we'll just keep accreting it.

Parth Mehrotra: There's no set timeline. We said over the next few years. It can ebb and flow, but I think we'll just keep accreting it, and we actually feel really good about it because this was a target we had set when we went public at our IPO about five years ago. We're already there at the low end.

Speaker #3: And we actually feel really good about it because this was a target we had set when we went public at our IPO about 5 years ago.

Speaker #3: And we're already there at the low end. A lot of our mature markets are already well above that target, close to the high end or above even the high end.

Parth Mehrotra: A lot of our mature markets are already well above that target, close to the high end or above even the high end. That gives us the confidence that as we mature some of the other newer markets, overall the profitability should keep trending up.

Speaker #3: So that gives us the confidence that as we mature some of the other, newer markets, overall profitability should keep trending up.

Speaker #2: Thank you. Our next question. Comes from the line of Daniel Grosslight of Citi. Please go ahead, Daniel.

Operator: Thank you. Our next question comes from the line of Daniel Grosslight of Citi. Please go ahead, Daniel.

Daniel Grosslight: Hi. Thanks for taking the question, and congrats on another solid quarter here. I want to focus a little bit on the updated guide, particularly around practice collections. It does imply a pretty strong deceleration in growth from H1 to H2. I think it's around, you mentioned, 13% in H1 to around 3% in H2 year-over-year. That's despite continued provider and attributed lives growing. I'm just curious, what's driving that implied deceleration? Is that just conservatism or are there specific headwinds or maybe a difficult comp period that we should be aware of in H2 of the year? Thanks.

Speaker #6: Hi, thanks for taking the question. Congrats on another solid quarter here. I want to focus a little bit on the updated guide, particularly around practice collections it does imply a pretty strong deceleration in growth from 1H to 2H.

Speaker #6: I think it's around you mentioned 13% in the first half to around 3% in the second half year over year. And that's despite continued provider and attributed lives growing.

Speaker #6: I'm just curious, what's driving that implied deceleration? Is that just conservatism, or are there specific headwinds or maybe a difficult comp period that we should be aware of in the second half of the year?

Daniel Grosslight: I'm just curious, what's driving that implied deceleration? Is that just conservatism or are there specific headwinds or maybe a difficult comp period that we should be aware of in H2 of the year? Thanks.

Speaker #6: Thanks.

Speaker #3: Yeah, thanks for the question, Dan. Yeah, there's nothing much in the implied. I mean, we've done this for 21 quarters. You've seen how we guide.

Parth Mehrotra: Thanks for the question, Dan. There's nothing much in the implied. We've done this for 21 quarters. You've seen how we guide. It's still middle of the year, we're just being prudent, conservative, whatever you want to call it. At the midpoint, we got it to the high end of the original range. If the trends continue, there should be further upside. We'll just see how it plays out. I think we feel really good about ambulatory utilization. I think folks continue to visit their primary care providers or whoever the first point of contact. I think a lot of the utilization trends you're seeing on the inpatient side, as reported by the health systems, I think, doesn't really apply to a business like Privia. We've talked about that in the past.

Speaker #3: It's still middle of the year. So we're just being prudent, conservative, whatever you want to call it. At the midpoint, we got it to the high end of the original range.

Speaker #3: If the trends continue, there should be further upside. We'll just see how it plays out. I think we feel really good about ambulatory utilization.

Speaker #3: I think folks continue to visit their primary care providers or whoever's the first point of contact. So I think a lot of the utilization trends you're seeing on the inpatient side, as reported by the health systems, I think it doesn't really apply to a business like Privia.

Parth Mehrotra: I think folks continue to visit their primary care providers or whoever the first point of contact. I think a lot of the utilization trends you're seeing on the inpatient side, as reported by the health systems, I think, doesn't really apply to a business like Privia. We've talked about that in the past.

Speaker #3: We've talked about that in the past. So I think we feel really good overall. And the year goes on, and we keep progressing, so we'll update the guidance as it comes.

Parth Mehrotra: I think we feel really good overall and the year goes on, and we keep progressing, we'll update the guidance as it comes.

Speaker #6: Thank you.

Daniel Grosslight: Thank you.

Speaker #2: Thank you. Our next question comes from the line of AJ Rice of UBS. AJ, your line is open.

Operator: Our next question comes from the line of A.J. Rice of UBS. A.J., your line is open.

A.J. Rice: Hi, everybody. I know there are a variety of drivers that give you confidence on that margin of improvement over time, operating leverage, obviously, shared risk performance, value-based performance. You also now, for several quarters, have been mentioning the AI opportunities. I wondered if it's possible to get you to enumerate a little bit on some of the use cases, either at the corporate level or at the practice level, that you're seeing that get you excited about the opportunities for that to drive improved efficiencies.

Speaker #7: Hi, everybody. I know there are a variety of drivers that give you confidence on that margin: improvement over time, operating leverage, obviously shared risk, performance, value-based performance.

Speaker #7: But you also now, for several quarters, have been mentioning the AI opportunities. And I wondered if it's possible to get you to enumerate a little bit on some of the use cases, either at the corporate level or at the practice level, that you're seeing that get you excited about the opportunities for that to drive improved efficiencies.

Speaker #3: Yeah, I appreciate the question, AJ. So, I think we covered this in a fair bit of detail on the last call, but we are looking at our four core workflows.

Parth Mehrotra: Yeah, I appreciate the question, A.J. I think we covered this in fair bit of detail on the last call. We are looking at our four core workflows across corporate functions, fee-for-service workflows, value-based workflows, and then everything that happens in the patient care experience as the doctor or the provider sees their patient. I think across those flows, we're looking at every single aspect, existing partnerships we have. We're on the Google platform, so we're using Gemini all across the board in different aspects of the corporate workflow. We have other tech companies we work with similarly that have embedded a lot of AI applications. Then our dev team's continuing to see where we can build, buy, partner. Whether it's patient experience, whether it's clinical decision-making by the doctors, whether it's obviously revenue cycle workflows, all of those are getting impacted.

Speaker #3: Across corporate functions, FIFA service workflows, value-based workflows, and then everything that happens in the patient care experience. As the doctor or the provider sees their patient.

Speaker #3: So I think across those flows, we're looking at every single aspect, existing partnerships we have. We're on the Google platforms. We're using Gemini. All across the board in different aspects of the corporate workflow.

Parth Mehrotra: We're on the Google platform, so we're using Gemini all across the board in different aspects of the corporate workflow. We have other tech companies we work with similarly that have embedded a lot of AI applications. Then our dev team's continuing to see where we can build, buy, partner. Whether it's patient experience, whether it's clinical decision-making by the doctors, whether it's obviously revenue cycle workflows, all of those are getting impacted.

Speaker #3: We have other tech companies we work with similarly that have embedded a lot of AI applications. And then our dev teams are continuing to see where we can build by partner—so whether it's patient experience, whether it's clinical decision-making by the doctors, whether it's, obviously, revenue cycle workflows.

Speaker #3: All of those are getting impacted. I think technology is advancing at a pretty good pace. We are piloting a lot of stuff. We're already seeing a lot of benefit.

Parth Mehrotra: I think technology's advancing at a pretty good pace. We are piloting a lot of stuff. We're already seeing a lot of benefit. I think tangibly, that's why we've always linked this with EBITDA margin expansion. Ultimately, we are measuring our ability to deploy these applications and seeing if things can be done better, faster, cheaper. As we grow, we probably don't need to add a lot more expenses in headcount or other fixed costs. All of those are going to help us achieve that. We've talked in the past about, we invested in a business called Navina for suspect medical conditions, coding compliance, et cetera. That's already played out pretty well. We have good case studies for that. I think, again, we're really excited.

Speaker #3: And I think tangibly, that's why we've always linked this with EBITDA margin expansion. Ultimately, we are measuring our ability to deploy these applications and seeing if things can be done better, faster, cheaper.

Speaker #3: And as we grow, we probably don't need to add a lot more expenses in headcount or other fixed costs. So all of those are going to help us achieve that.

Parth Mehrotra: All of those are going to help us achieve that. We've talked in the past about, we invested in a business called Navina for suspect medical conditions, coding compliance, et cetera. That's already played out pretty well. We have good case studies for that. I think, again, we're really excited.

Speaker #3: We've talked in the past about we invested in in a business called Novena for suspect medical conditions, coding compliance, etc. That's already played out pretty well.

Speaker #3: We have good case studies for that. And so I think, again, we're really excited. Business like ours is a perfect use case in deploying a lot of these applications.

Parth Mehrotra: A business like ours is a perfect use case in deploying a lot of these applications as they evolve over time. I think we'll just continue in that journey over the next few years.

Speaker #3: As they evolve over time, and so I think we'll just continue in that journey over the next few years.

Speaker #2: Thank you. Our next question. Comes from the line of Jalindra Singh of Truist. Please go ahead, Jalindra.

Operator: Thank you. Our next question comes from the line of Jailendra Singh of Truist. Please go ahead, Jailendra.

Speaker #5: Thank you. And congrats on a strong quarter. I want to ask about the New Jersey entry. I know it's a small size initial ankle practice, but just to confirm, did that have any impact to your guidance on any metric?

Jailendra Singh: Thank you, and congratulations on a strong quarter. I want to ask about the New Jersey entry. I know it's a small size initial anchor practice, but just to confirm, did that have any impact to your guidance on any metric? More broadly, anything you can share about your approach there, onboarding process. Do you see that market ultimately evolving similar to some of your more successful market launches in the past?

Speaker #5: And more broadly, anything you can share about your approach there, onboarding process? Do you see that market ultimately evolving similar to some of your more successful market launches in the past?

Speaker #3: Yeah, thanks for the question, Jalindra. Yeah, I mean, pretty small practice, but really good set of providers. We're really excited to partner with them.

Parth Mehrotra: Yeah. Thanks for the question, Gilendra. Yeah, pretty small practice, but really good set of providers. We are really excited to partner with them. It is a very important state from a healthcare spend perspective. A lot of independent providers. I think a lot of providers inside health systems or other entities that may come out and join a platform like Privia, as some of the things play out in the market. It was on our radar for a while, and we are glad to just finally enter. Like many other markets, I think this will be a five, 10-year play for us. In every market we enter, we hope to establish a pretty large medical group. As you know, our strategy is not to just be small in any market. We are looking to build local density of providers across the state.

Speaker #3: It's a very important state from a healthcare spend perspective. A lot of independent providers. I think a lot of providers inside health systems or other entities that may come out and join a platform like Privia.

Speaker #3: As some of the things play out in the market. So it's been on our it was on our radar for a while. And we're glad to just finally enter.

Speaker #3: And like many other markets, I think this will be a 5, 10-year play for us. In every market we enter, we hope to establish a pretty large medical group.

Parth Mehrotra: Like many other markets, I think this will be a five, 10-year play for us. In every market we enter, we hope to establish a pretty large medical group. As you know, our strategy is not to just be small in any market. We are looking to build local density of providers across the state.

Speaker #3: I mean, as you know, our strategy is not to just be small in any market. We are looking to build local density, a providers across the state.

Speaker #3: So that playbook hopefully plays out here as well. And we hope to just continue to grow. Again, given the size of the practice, I mean, it's not like this impacted given the timing of the deal and towards the middle of the year, it doesn't impact some of our metrics meaningfully, but small contribution.

Parth Mehrotra: That playbook hopefully plays out here as well, and we hope to just continue to grow. Again, given the size of the practice, it is not like this impacted, given the timing of the deal and towards the middle of the year, it does not impact some of our metrics meaningfully, but small contribution. Overall, we have just had a good first six months, so that reflects in our guidance.

Speaker #3: But overall, we've just had a good first six months, so that reflects in our guidance.

Operator: Thank you. Our next question comes from the line of Ryan Langston of TD Cowen. Please go ahead, Ryan.

Speaker #2: Thank you. Our next question comes from the line of Ryan Langston of TD Cowen. Please go ahead, Ryan.

Speaker #8: Yeah, thanks. Just maybe any updates on how the Evelint and IMS transactions from last year are progressing this year. Thank you.

Ryan Langston: Yeah. Thanks. Just maybe any updates on how the Evolent and IMS transactions from last year are progressing this year? Thank you.

Speaker #3: Yeah, thanks, Ryan. I mean, they're progressing really well. We've integrated both pretty much into our operating cadence. You're seeing some of the growth rates that reflect those acquisitions.

Parth Mehrotra: Yeah, thanks, Ryan. Yeah, they're progressing really well. We've integrated both pretty much into our operating cadence. You're seeing some of the growth rates that reflect those acquisitions. They were both good additions. Our updated guidance reflects some of the good performance in both. We're really excited about being in Arizona. I think it'll be a big state for us. A lot of momentum, great physician partners there with IMS, as we build that medical group further over the next few years. Really excited about the Evolent business that we bought. The Privia Care Partners business will continue to grow hopefully, and it'll be an added way for us to partner with many providers that may not choose to join our medical group, so the full offering right away, but ultimately it'll be a good pipeline.

Speaker #3: They were both good additions. And our updated guidance reflects some of the good performance in both. So we're really excited about being in Arizona.

Speaker #3: I think it'll be a big state for us. A lot of momentum, great physician partners there with IMS. As we build that medical group further over the next few years, and really excited about the Evelint business that we bought.

Parth Mehrotra: A lot of momentum, great physician partners there with IMS, as we build that medical group further over the next few years. Really excited about the Evolent business that we bought. The Privia Care Partners business will continue to grow hopefully, and it'll be an added way for us to partner with many providers that may not choose to join our medical group, so the full offering right away, but ultimately it'll be a good pipeline.

Speaker #3: The care partners business would continue to grow, hopefully, and it'll be an added way for us to partner with many providers that may not choose to join our medical group.

Speaker #3: So the full offering right away, but ultimately, it'll be a good pipeline. So I think it allows us to expand into many states. Look at further tuck-in acquisitions to add to that platform over time.

Parth Mehrotra: I think it allows us to expand into many states, look at further tuck-in acquisitions to add to that platform over time. I know we're pretty excited. Just going to grind it out quarter by quarter, month by month, and just keep building those businesses.

Speaker #3: So I think we're pretty excited—just going to grind it out, quarter by quarter, month by month, and just keep building those businesses.

Operator: Thank you. Our next question comes from the line of Sean Dodge of BMO Capital Markets. Your line is open, Sean.

Speaker #2: Thank you. Our next question comes from the line of Sean Dodge of BMO Capital Markets. Your line is open, Sean.

Thomas Keller: Hey, good morning. This is Thomas Keller on for Sean. Thanks for taking the question. From the practice or the physician's perspective in thinking about the economics and the value prop around joining the Privia platform, how much incrementally do they typically stand to benefit? How has that value prop evolved over the last few years or so as you've built all this density and continue to strengthen and scale the value-based care business? Thanks.

Speaker #6: Hey, good morning. This is Thomas Keller. I'm for Sean. Thanks for taking the question. From the practice or the physician's perspective, and thinking about the economics and the value prop around joining the Privia platform, how much incrementally do they typically stand to benefit?

Speaker #6: And how has that value prop evolved over the last few years or so as you've built all this density and continued to strengthen and scale the value-based care business?

Speaker #6: Thanks.

Speaker #8: Yeah, appreciate the question,

Parth Mehrotra: Yeah, appreciate the question, Tom. This was a question that used to come up much earlier in our journey as a public company, as we were explaining the story. That thesis has only improved over time, over the past five years as we build density. The components of value creation are obviously, better fee-for-service contract rates relative to what they could cobble up on their own that appropriately pays them for all the work that they're doing relative to, which are still lower than a lot of the health systems of facility-based providers. It's a good value for the payers, to prevent these doctors from being acquired by much more expensive entities. Obviously a lot of expense savings on the technology side, a lot of efficiency.

Speaker #3: Tom. So I mean, this was a question they should come up much earlier in our journey as a public company, as we were explaining the story.

Speaker #3: But that thesis has only improved over time, over the past five years, as we build density. So the components of value creation are obviously better fee-for-service contract rates.

Speaker #3: Relative to what they could cobble up on their own, that appropriately pays them for all the work that they're doing, relative to—which are still lower than a lot of the health systems or facility-based providers.

Speaker #3: So it's a good value for the payers to prevent these doctors from being acquired by much more expensive entities. Obviously, there's a lot of expense savings on the technology side, a lot of efficiency—this 10 to 20 percent productivity lift—as the physicians are not spending time on technology or payer contracts or some of the administrative tasks that we take over.

Parth Mehrotra: It's a good value for the payers, to prevent these doctors from being acquired by much more expensive entities. Obviously a lot of expense savings on the technology side, a lot of efficiency.

Parth Mehrotra: There's 10% to 20% productivity lift as the physicians are not spending time on technology or payer contracts or some of the administrative tasks that we take over. Obviously, the whole value-based story plays along, where a lot of the providers have never been in a value-based arrangement or have just dabbled into it, and we just provide a very sophisticated machinery around them to participate across the entire patient panel, which is important. It's not just Medicare lives, but also commercial lives and Medicaid. We are able to transform what is a simple fee-for-service payment into a multi-acute set of payments between care management fees, shared savings, bonus-related payments, across the entire patient panel, and that's the value add to the payers as well. You add all that up over time and it can range from 15%, 20% to as high as 50%.

Speaker #3: And then obviously, the whole value-based story plays along where a lot of the providers have never been in a value-based arrangement or have just dabbled into it, and we just provide a very sophisticated machinery around them to participate across the entire patient panel, which is important.

Speaker #3: It's not just Medicare lives, but also commercial lives and Medicaid. And we are able to transform what is a simple fee-for-service payment into a multi-cued set of payments between care management fees, shared savings, and bonus-related payments across the entire patient panel.

Parth Mehrotra: It's not just Medicare lives, but also commercial lives and Medicaid. We are able to transform what is a simple fee-for-service payment into a multi-acute set of payments between care management fees, shared savings, bonus-related payments, across the entire patient panel, and that's the value add to the payers as well. You add all that up over time and it can range from 15%, 20% to as high as 50%.

Speaker #3: And that's the value add to the payers as well. So you add all that up over time, and it can range from 15, 20 to, as high as 50 percent.

Speaker #3: And then what we also do is develop a business plan for each of these practices to organically grow their business, whether it's adding extra providers, physicians, nurse practitioners, growing their patient panel, adding another location, adding a specialist.

Parth Mehrotra: What we also do is develop a business plan for each of these practices to organically grow their business, whether it's adding extra providers, physicians, nurse practitioners, growing their patient panel, adding another location, adding a specialist. We've had practices, and we had some of these case studies in our SEC filings over time, where we've doubled the size of the practice over a five, seven-year period, and really build these businesses at the small scale level. That's all the benefit, and I think we just continue to refine that, continue to be a great partner to these practices as they remain independent and thrive as a business in the communities in a very low-cost setting. You can see that in the flywheel and our growth rates over the past eight, nine years on slide 12, and that contributes to the same-store growth.

Speaker #3: So we've had practices and we had some of these case studies in our SEC filings over time, where we've doubled the size of the practice over a five, seven-year period and really build these businesses at the small-scale level.

Speaker #3: So that's all the benefit and I think we just continue to refine that, continue to be a great partner to these practices as they remain independent and thrive as a business in the communities in a very low-cost setting.

Parth Mehrotra: That's all the benefit, and I think we just continue to refine that, continue to be a great partner to these practices as they remain independent and thrive as a business in the communities in a very low-cost setting. You can see that in the flywheel and our growth rates over the past eight, nine years on slide 12, and that contributes to the same-store growth.

Speaker #3: So you can see that in the flywheel in our growth rates over the past eight, nine years on slide 12, and that contributes to the same store growth.

Speaker #3: So really excited about continuing to just have that play out.

Parth Mehrotra: Really excited about continuing to just have that play out.

Operator: Thank you. Our next question comes from the line of Andrew Mok of Barclays. Please go ahead, Andrew.

Speaker #2: Thank you. Our next question comes from the line of Andrew Mock of Barclays. Please go ahead, Andrew.

[Analyst] (Barclays): Hi, good morning. This is Jeffrey on for Andrew. Provider expenses increased to $500 million in the quarter, which grew faster than revenue and was a bit higher than street expectations. Can you provide more detail on the drivers of that variance, particularly across care categories and business lines? Thanks.

[Analyst]: Hi, good morning. This is Jeffrey on for Andrew. Provider expenses increased to $500 million in the quarter, which grew faster than revenue and was a bit higher than street expectations. Can you provide more detail on the drivers of that variance, particularly across care categories and business lines? Thanks.

Speaker #5: Hi, good morning. This is Jeffrey on for Andrew. Provider expenses increased to $500 million the quarter, which grew faster than revenue and was a bit higher than street expectations.

Speaker #5: Can you provide more detail on the drivers of that variance, particularly across care categories and business lines? Thanks.

Parth Mehrotra: Can you repeat that again? You said provider census?

Speaker #7: Can you repeat that again? You said provider census.

[Analyst] (Barclays): Provider expense.

[Analyst]: Provider expense.

Speaker #5: Provider expense. So I think it was a little bit—it was $500 million for the quarter. Just wondering what that was between that and Street is.

Parth Mehrotra: Thank you.

[Analyst] (Barclays): It was $500 million in the quarter. Just wondering what the delta between that and street is.

[Analyst]: It was $500 million in the quarter. Just wondering what the delta between that and street is.

Speaker #3: Yeah, I think you’ve got to just take a look at it on an annual basis. I mean, I’m assuming you’re referring to the disclosure on page nine of our press release.

Parth Mehrotra: Yeah, I think you got to just take a look at an annual basis. I'm assuming you're referring to the disclosure on page nine of our press release. I just think you got to look at annually, and our guidance just reflects the good performance overall. Overall, those are payments that we pass through to the providers, on our fee-for-service book, as well as the value-based book over time. It just reflects the growth of the business.

Speaker #3: So I just think you got to look at annually and our guidance just reflects the good performance overall. So overall, those are payments that we pass through to the providers.

Speaker #3: On our fee-for-service book as well as the value-based book, over time. So it just reflects the growth of the business.

Operator: Thank you. Our next question comes from the line of Matthew Gillmor of KeyBank. Please go ahead, Matthew.

Speaker #2: Thank you. Our next question comes from the line of Matthew Gilmore of KeyBank. Please go ahead, Matthew.

Speaker #6: Hi, thanks for the question. I wanted to follow up on some of the MSSP discussion and the proposed changes to the financial methodology. It seemed positive overall and CMS is trying to encourage participation.

Matthew Gillmor: Hi. Thanks for the question. I wanted to follow up on some of the MSSP discussion and the proposed changes to the financial methodology. It seemed positive overall, and CMS is trying to encourage participation. There were some sort of puts and takes for enhanced track ACOs, at least the way we read it. I was curious what you all thought of the proposal and if there are any sort of noteworthy implications for Privia.

Speaker #6: There were some sort of puts and takes for enhanced tracked ACOs, at least the way we read it. I was curious what you all thought of the proposal and if there are any sort of noteworthy implications for Privia.

Speaker #3: Yeah, thanks, Matt. Yeah, I think as you summarize overall, we think it's positive. I think CMS continues to refine the program for the better.

Parth Mehrotra: Yeah, thanks, Matt. I think as you summarize, overall, we think it's positive. I think CMS continues to refine the program for the better. Some of the changes on adding new providers who have never been in an ACO, how we measure attribution. I think some of the changes around rebasing that happens every five years or so, I think all of those are positive. I think they can continue to refine it based on some of the adjustments on a regional basis. I think there's still some work to be done in our minds, where you don't need three or four programs. They tried Reach, now they have Lead. Over time, let's see if these programs merge into MSSP. Overall, look, I think it's a step in the right direction. I think it was pretty positive overall.

Speaker #3: So some of the changes on adding new providers who've never been in an ACO, how we measure attribution, I think some of the changes around rebasing that happens every five years or so.

Speaker #3: I think all of those are positive. I think they can continue to refine it based on some of the adjustments on a regional basis.

Parth Mehrotra: I think they can continue to refine it based on some of the adjustments on a regional basis. I think there's still some work to be done in our minds, where you don't need three or four programs. They tried Reach, now they have Lead. Over time, let's see if these programs merge into MSSP. Overall, look, I think it's a step in the right direction. I think it was pretty positive overall.

Speaker #3: And then I think there's still some work to be done in our minds where you don't need three or four programs. I mean, they tried reach, now they have lead.

Speaker #3: Over time, let's see if these programs merge into MSSP. But overall, look, I think it's a step in the right direction. I think it was pretty positive.

Speaker #3: Overall, I think they made a really good effort to continue to improve the program. It continues to be one of the longest-serving programs.

Parth Mehrotra: I think they made a real good effort to continue to improve the program. It continues to be one of the longest serving programs, with very wide adoption across many hundred thousands of providers, millions of beneficiaries. I think CMS appropriately wants to make sure that they keep doing right by community-based providers who are participating in this. I think we feel really good about MSSP directly contracting with the government on this program and delivering shared savings. I think, over time, it'll just get better. Pretty excited and part of our guidance increase kind of reflects that. We'll just see how we keep doing that over the next few years, but really, really happy about it.

Speaker #3: With very wide adoption, across many hundreds of thousands of providers, and millions of beneficiaries, I think CMS appropriately wants to make sure that they keep doing right by community-based providers who are participating in this.

Speaker #3: So I think we feel really good about MSSP directly contracting with the government on this program and delivering shared savings. So I think over time, it'll just get better.

Parth Mehrotra: I think we feel really good about MSSP directly contracting with the government on this program and delivering shared savings. I think, over time, it'll just get better. Pretty excited and part of our guidance increase kind of reflects that. We'll just see how we keep doing that over the next few years, but really, really happy about it.

Speaker #3: So pretty excited. And part of our guidance increase kind of reflects that. And so we'll just see how we keep doing that over the next few years.

Speaker #3: But really, really happy about it.

Speaker #2: Thank you. Our next question comes from the line of Whit Mayo of Lurink Partners. Please go ahead, Whit.

Operator: Thank you. Our next question comes from the line of Whit Mayo of Leerink Partners. Please go ahead, Whit.

Speaker #5: Yeah, hey, thanks. Looking at the implemented provider growth this quarter, would you be willing to share how much of that growth is coming from new physicians joining existing groups versus new groups affiliating with Privia?

Whit Mayo: Yeah. Hey, thanks. Looking at the implemented provider growth this quarter, would you be willing to share how much of that growth is coming from new physicians joining existing groups versus new groups affiliating with Privia? Thanks.

Speaker #5: Thanks.

Speaker #3: Yeah, thanks for the question, Whit. Yeah, we don't break that out because it just changes every quarter. So we just look at that on an annual basis.

Parth Mehrotra: Yeah, thanks for the question, Whit. Yeah, we don't break that out because it just changes every quarter. We just look at that on an annual basis. Same-store growth is usually 1% to 2%, but that includes both price and volume. Some years it's higher, depending on just the mix. We're growing our practices same store in a pretty meaningful way, and the base keeps getting bigger, so it could be higher than that number in a few years. Obviously, we are adding new practices in the existing states and entering new states. Just mix just varies. The good news is it just, as you know, it takes us five to six months to implement every provider from the sale, and the business becomes therefore very predictable nine to 12 months out.

Speaker #3: Same store growth is usually one to two percent, but that includes both price and volume. Some years it's higher. Depending on just the mix.

Speaker #3: We're growing up practices same store in a pretty meaningful way, and the base keeps getting bigger. So it could be higher than that number in a few years.

Parth Mehrotra: We're growing our practices same store in a pretty meaningful way, and the base keeps getting bigger, so it could be higher than that number in a few years. Obviously, we are adding new practices in the existing states and entering new states. Just mix just varies. The good news is it just, as you know, it takes us five to six months to implement every provider from the sale, and the business becomes therefore very predictable nine to 12 months out.

Speaker #3: And then obviously, we are adding new practices. In the existing states and then entering new states. So just mix just varies. The good news is it just, as you know, it takes us five to six months to implement every provider from the sale.

Speaker #3: And the business becomes therefore very predictable nine to twelve months out. So if we keep hitting the metrics, by the time we give the following year guidance in February, 90% of the business is pretty much locked in on the fee-for-service basis.

Parth Mehrotra: If we keep hitting the metrics, by the time we give the following year guidance in February, 90% of the business is pretty much locked in on a fee-for-service basis. I think that just bodes well, and I think we'll just continue to play on all those levers, like try to go these practices same store and try to keep adding new providers. It's tough to just break out in one particular quarter or half a year, because that just changes.

Speaker #3: So I think that just bodes well. And I think we'll just continue to play on all those levers, try to grow these practices same-store, and try to keep adding new providers.

Speaker #3: But it's tough to just break out in one particular quarter or half a year, because that just changes.

Operator: Thank you. Our next question comes from the line of Matthew Shea of Needham. Please go ahead, Matthew.

Speaker #2: Thank you. Our next question comes from the line of Matthew Shea of Needham. Please go ahead, Matthew.

Matthew Shea: Hey, good morning. Thanks for the question and congrats on the nice quarter here. Maybe on go-to-market, you're running the two distinct go-to-market motions now, the full medical group and the wider ACO-only model. How has the two-pronged strategy done so far in 2026? Anything interesting to call out? Obviously, we can see the adoption of the full medical group in implemented providers, but it would be good to hear specifically how the ACO-only model is resonating. Any notable additions there?

Speaker #6: Hey, good morning. Thanks for the question and congrats on the nice quarter here. Maybe on go-to-market, you're running the two-district go-to-market motions now. The full medical group and the wider ACO-only model.

Speaker #6: How is the two-prong strategy done so far in 2026? Anything interesting to call out? And obviously, we can see the adoption of the full medical group in implemented providers, but would be good to hear specifically how the ACO-only model is resonating.

Speaker #6: I mean, any notable additions there?

Speaker #3: Yeah, I appreciate the question. I mean, it's still a little bit early for us. We just bought the business, closed it in the by the end of last year, and integrated it.

Parth Mehrotra: Yeah, appreciate the question. It's still a little bit early for us. We just bought the business, closed it by the end of last year, and integrated it. I think it allows us to have many more conversations in states where we do not have a medical group entity set up yet. I think it allows us to enter into partnerships with a much more bigger TAM, if you will. Also allows us to follow up that one particular acquisition with other tuck-in acquisitions, if available. There are a lot of ACO entities in subscale business models that I think we could pick up over time. It just depends what is available at what price. I think it allows us to run that playbook pretty efficiently as some of the disruption happens in the industry. Overall, I think we're very excited about it.

Speaker #3: But I think it allows us to have many more conversations in states where we do not have a medical group entity set up yet.

Speaker #3: And so I think it allows us to enter into partnerships with a much more bigger TAM, if you will. Also allows us to follow up that one particular acquisition with other tuck-in acquisitions, if available.

Speaker #3: There are a lot of ACO entities in subscale business models that I think we could pick up over time. It just depends on what is available at what price.

Parth Mehrotra: There are a lot of ACO entities in subscale business models that I think we could pick up over time. It just depends what is available at what price. I think it allows us to run that playbook pretty efficiently as some of the disruption happens in the industry. Overall, I think we're very excited about it.

Speaker #3: So I think it allows us to run that playbook pretty efficiently as some of the disruption happens in the industry. So, overall, I think we're very excited about it.

Speaker #3: I think, and we do it in MSSP, which is a program largely that we understand. And then we can also add commercial and MA value-based contracts to that same playbook.

Parth Mehrotra: We do it in MSSP, which is a program largely that we understand. We can also add commercial and MA value-based contracts to that same playbook, through a CIN or an IPA type of a network in a particular state. I think we'll just build that out over time, and it'll be a good addition. Hopefully over time, we'll have some cross-sell where some of these providers join our full medical group for the full set of services. I think it'll play out over the next four or five years. That's our timeline to run any of these plays. It's early days, but I think we're pretty excited about it.

Speaker #3: Through a CIN or an IPA type of a network in a particular state. So I think we'll just build that out over time and it'll be a good addition.

Speaker #3: And then hopefully over time, we'll have some cross-sell where some of these providers join our full medical group for the full set of services.

Parth Mehrotra: Hopefully over time, we'll have some cross-sell where some of these providers join our full medical group for the full set of services. I think it'll play out over the next four or five years. That's our timeline to run any of these plays. It's early days, but I think we're pretty excited about it.

Speaker #3: So I think it'll play out over the next four or five years. That's our timeline to run any of these plays. So but it's early days, but I think we're pretty excited about it.

Speaker #2: Thank you. Our next question comes from the line of Jessica to sign. Of Piper Sandler. Please go ahead, Jessica.

Operator: Thank you. Our next question comes from the line of Jessica Tassan of Piper Sandler. Please go ahead, Jessica.

Speaker #7: Hi, guys. Thank you so much for the question and congrats on the strong results again. So we have cost of platform coming in at about 52 and a half percent of care margin, which is down 400 bips year over year.

Jessica Tassan: Hi, guys. Thank you so much for the question and congrats on the strong results again. We have cost of platform coming in at about 52.5% of care margin, which is down 400 basis points year-over-year. Should we still think about the cost of platform as kind of the cost associated with third-party EHR software? Just does the Q2 leverage reflect the full extent of that opportunity, or is there a longer-term opportunity to kind of negotiate pricing down and continue to drive margin expansion on that line? Thank you.

Speaker #7: Should we still think about the cost of platform as kind of the cost associated with third-party EHR software? And then just the 2Q leverage reflects the full extent of that opportunity or is there a longer-term opportunity to kind of negotiate pricing down and continue to drive margin expansion on that line?

Speaker #7: Thank you.

Speaker #3: Yeah, I appreciate the question, Jess. So I think, again, like you got to look at it over years. On an annual basis, it can get impacted by shared savings accruals in one quarter or one half also.

Parth Mehrotra: Yeah, appreciate the question, Jess. I think, again, you got to look at it over years, on an annual basis. It can get impacted by shared savings accruals in one quarter or one half also, because that flows down care margin to cost of platform. Over time, our job is to keep increasing that, and that's part of the EBITDA to care margin story as well. It's a combination of both the cost of platform and SG&A. I think it'll just keep improving, hopefully over time. There are different levers. Technology spend is one. We don't capitalize any software, as you know. It's all expense in the P&L.

Speaker #3: Because that flows down care margin to cost of platform. But over time, our job is to keep increasing that. And that's part of the EBITDA to care margin story as well.

Speaker #3: It's a combination of both the cost of platform and SG&A. So I think it'll just keep improving hopefully over time. And there are different levers.

Parth Mehrotra: I think it'll just keep improving, hopefully over time. There are different levers. Technology spend is one. We don't capitalize any software, as you know. It's all expense in the P&L.

Speaker #3: I mean, technology spend So I think it's a combination of all of those that we'll continue to hopefully scale over time. And yeah, we have levers in our contracts that as we get bigger, we scale those costs appropriately.

Speaker #3: is one. We don't capitalize any software, as you know. It's all expense in the P&L. But then it's also a lot of our practice operations, supporting these practices.

Parth Mehrotra: It's also a lot of our practice operations, supporting these practices on both the fee-for-service and value-based book, a lot of the revenue cycle function that we have, a lot of our market leadership, fixed costs, variable costs. I think it's a combination of all of those that we'll continue to hopefully scale over time. Yeah, we have levers in our contracts that as we get bigger, we scale those costs appropriately. We'll just keep pulling that lever. I think, as we've said, our target is try to get to that high end of EBITDA to care margin. I think if you look at Slide 12, over the past nine years, both cost of platform and SG&A has scaled really well. That has led to pretty good accretion on the EBITDA margin as a percentage of care margin.

Speaker #3: On both the fee-for-service and value-based book, a lot of the revenue cycle function that we have. A lot of our market leadership, fixed cost, variable cost.

Speaker #3: And so we'll just keep pulling that lever. So I think as we've said, our target is try to get to that high end of EBITDA to care margin.

Parth Mehrotra: I think, as we've said, our target is try to get to that high end of EBITDA to care margin. I think if you look at Slide 12, over the past nine years, both cost of platform and SG&A has scaled really well. That has led to pretty good accretion on the EBITDA margin as a percentage of care margin.

Speaker #3: And I think if you look at over the look at slide 12, over the past nine years, I mean, both cost of platform and SG&A has scaled really well.

Speaker #3: That has led to pretty good accretion on the EBITDA margin as a percentage of care margin. So hopefully we'll just keep doing that.

Parth Mehrotra: Hopefully we'll just keep doing that.

Speaker #2: Thank you. Our next question comes from the line of Jackson Sleman of Jefferies. Your line is open, Jack.

Operator: Thank you. Our next question comes from the line of Jack Slevin of Jefferies. Your line is open, Jack.

Speaker #6: Hey, good morning, guys. Congrats on the quarter and thanks for taking the question. I just wanted to double-click a little bit a bit on the BD side of things for the ACO business.

Jack Slevin: Hey, good morning, guys. Congrats on the quarter, and thanks for taking the question. I just want to double-click a little bit on the BD side of things for the ACO business. Understanding we have this transition this year from ACO REACH to LEAD, possibly some disruption in the marketplace. Wanted to hear if you have any additional color on sort of if that's creating pockets of opportunity or how you think about organic adds to the ACO business going forward. Thanks.

Speaker #6: Just understanding we have this transition this year from ACO reach to lead possibly some disruption in the marketplace. Just wanted to hear if you have any additional color on sort of if that's creating pockets of opportunity or how you think about organic adds to the ACO business going forward.

Speaker #6: Thanks.

Speaker #3: Yeah, good question. So I think it's both organic and inorganic. Where now that we have a care partners the Eveland platform that we bought, it allows us to go sell organically into practices that were part of reach.

Parth Mehrotra: Yeah, good question. I think it's both organic and inorganic, where now that we have Care Partners, the Evolent platform that we bought, it allows us to go sell organically into practices that were part of REACH that may be considering what they do next. I think that's helpful. We didn't have that before. Then obviously there are acquisition opportunities of all scale and size, which we continue to evaluate, so we can add to that. Part of that is based on this disruption of essentially a set of contracts just ended with CMS, so those providers have to find a new partner, or the entity has to figure out a new set of programs that they have to participate in, which they may or may not have the capability to do so.

Speaker #3: There may be considering what they do next. And so I think that's helpful. We didn't have that before. And then obviously they are acquisition opportunities of all scale and size, which we continue to evaluate.

Parth Mehrotra: We didn't have that before. Then obviously there are acquisition opportunities of all scale and size, which we continue to evaluate, so we can add to that. Part of that is based on this disruption of essentially a set of contracts just ended with CMS, so those providers have to find a new partner, or the entity has to figure out a new set of programs that they have to participate in, which they may or may not have the capability to do so.

Speaker #3: So we can add to that. And part of that is based on this disruption of essentially a set of contracts just ended with CMS.

Speaker #3: So those providers have to find a new partner or the entity has to figure out a new set of program that they have to participate in, which made they may or may not have the capability to do so.

Speaker #3: So again, I think as the industry consolidates to a few larger players at scale, it allows us to capture both that organic and inorganic opportunity.

Parth Mehrotra: Again, I think as the industry consolidates to a few larger players at scale, I think it allows us to capture both that organic and inorganic opportunity. I think it'll play out over time. Because I do think over time, you do need a set of capabilities which are much more deep-rooted than anybody raising some capital and starting an ACO and just giving money away to providers to join. That was the easy play. A lot of it got funded in five, six years ago, private equity, venture capital, smaller entities trying to do it. I think all that gets consolidated, hopefully over time as scale matters. We'll hopefully play on the right side of that trade.

Speaker #3: So I think it'll play out over time. Because I do think over time, you do need a set of capabilities which are much more deep rooted than anybody raising some capital and starting an ACO and just giving money away to providers to join.

Speaker #3: I mean, that was the easy play. A lot of it got funded in five, six years ago. Private equity, venture capital, smaller entities trying to do it.

Parth Mehrotra: That was the easy play. A lot of it got funded in five, six years ago, private equity, venture capital, smaller entities trying to do it. I think all that gets consolidated, hopefully over time as scale matters. We'll hopefully play on the right side of that trade.

Speaker #3: But I think all that gets consolidated hopefully over time as scale matters. So we'll hopefully play on the right side of that trade.

Operator: Thank you. Our next question comes from the line of Ryan Halsted of RBC. Please go ahead, Ryan.

Speaker #2: Thank you. Our next question. Comes from the line of Ryan Halstead of RPC. Please go ahead, Ryan.

Speaker #5: Good morning. Thanks for taking the question. My question is about the managed care. Landscape looking ahead at 2027. Just curious if there's anything you are starting to think about as you hear about MA plans reevaluating which markets that they're looking to stay in or exit.

Ryan Halsted: Good morning. Thanks for taking the question. My question is about the managed care landscape looking ahead at 2027. Just curious if there's anything you are starting to think about as you hear about MA plans reevaluating which markets that they're looking to stay in or exit, and similarly, Medicaid managed care and some of the comments that have been coming out about their expectations on membership. Appreciate that.

Speaker #5: And similarly, Medicaid managed care and some of the comments that have been coming out about their expectations on membership. Appreciate that.

Speaker #3: Yeah, it's a good question. Look, I mean, we are not in that business directly, but from everything you see and a lot of you have written about it based on the companies you cover, I think this happens every five years.

Parth Mehrotra: Yeah, it's a good question. Look, we are not in that business directly, but from everything you see, and a lot of you have written about it based on the companies you cover, I think, this happens every five years. The payers go through their cycle. I think some of the changes in V28, changes in the exchange population, redetermination in Medicaid, et cetera, have just caused a little bit more of a disruption this cycle. I think the payers obviously will make their adjustments. It's payer by payer, state by state, as you noted. The good news for a business like ours is we are in the business of creating very large, dense medical group with low cost in the community providers. We take that network in a very sophisticated manner to payers of healthcare across the patient panel, commercial, MA, Medicaid.

Speaker #3: The payers go through their cycle. I think some of the changes in V28, changes in the exchange population, redetermination in Medicaid, et cetera, have just caused a little bit more of a disruption this cycle.

Speaker #3: So I think the payers obviously will make their adjustments. It's payer by payer, state by state as you noted. The good news for a business like ours is we are in the business of creating very large dense medical group with low cost in the community providers.

Parth Mehrotra: I think the payers obviously will make their adjustments. It's payer by payer, state by state, as you noted. The good news for a business like ours is we are in the business of creating very large, dense medical group with low cost in the community providers. We take that network in a very sophisticated manner to payers of healthcare across the patient panel, commercial, MA, Medicaid.

Speaker #3: And we take that network in a very sophisticated manner to payers of healthcare. Across the patient panel, commercial, MA, Medicaid, and I think as cost pressures continue to increase, and as payers continue to wanting to create value, a business like ours becomes really important partner to them.

Parth Mehrotra: I think as cost pressures continue to increase and as payers continue to wanting to create value, a business like ours becomes really important partner to them, because we are delivering care at the ground level, in these communities. I think we just become a pretty important part of the whole machine. I think primary care, it's been written by a lot of you, it's been written in many studies. Primary care is a chassis that helps deliver care in a very cost-effective manner and take ownership of the total life cycle of the care dollars effectively for any patient, and the resulting outcomes from that. I think as value-based care evolves, as payers look to improve their own performance, they'll have to turn to entities like ours, because that's where performance is really delivered and care is delivered at the ground level.

Speaker #3: Because we are delivering care at the ground level in these communities. So I think we just become a pretty important part of the whole machine.

Speaker #3: I think primary care, it's been written by a lot of you. It's been written in many studies. Primary care is the chassis that helps deliver care in a very cost-effective manner.

Parth Mehrotra: Primary care is a chassis that helps deliver care in a very cost-effective manner and take ownership of the total life cycle of the care dollars effectively for any patient, and the resulting outcomes from that. I think as value-based care evolves, as payers look to improve their own performance, they'll have to turn to entities like ours, because that's where performance is really delivered and care is delivered at the ground level.

Speaker #3: And take ownership of the total life cycle of care or the care dollars effectively for any patient. And the resulting outcomes from that. So I think as value-based care evolves, as payers look to improve their own performance, they'll have to turn to entities like ours because that's where performance is really delivered and care is delivered at the ground level.

Speaker #3: So I think we'll just continue to be that partner and keep evolving state by state. The good news for us is the patients don't go away.

Parth Mehrotra: I think we'll just continue to be that partner and keep evolving state by state. The good news for us is the patients don't go away. It's not like populations are changing massively. If a payer exits, the person still has to go see their doctor if they are not well, and human beings get ill, they age, things happen. I think it bodes well for a business like ours to continue to capitalize on whatever might happen in the payer landscape.

Speaker #3: It's not like populations are changing massively. So if a payer exits, the person still has to go see their doctor if they're not well.

Speaker #3: And human beings get ill. They age. Things happen. So I think it boards well for a business like ours to continue to capitalize on whatever might happen in the payer landscape.

Speaker #2: Thank you. Our next question comes from the line of Olivia Miles of Baird. Please go ahead, Olivia.

Operator: Thank you. Our next question comes from the line of Olivia Miles of Baird. Please go ahead, Olivia.

Operator: Hi, this is Olivia Miles line for Michael Ha. Good morning, and thanks for taking the question. I wanted to ask more on your long-term adjusted EBITDA growth target. Having achieved an average 32% adjusted EBITDA growth over the last two years, and with yet another quarter of nearly 30% EBITDA growth on a business with high visibility, can you help us understand how you think about the puts and takes of your 20% long-term EBITDA growth target? Specifically, I'm interested in which factors or developments could cause you to revisit and potentially raise your multi-year view on EBITDA growth. Thank you.

Olivia Miles: Hi, this is Olivia Miles line for Michael Ha. Good morning, and thanks for taking the question. I wanted to ask more on your long-term adjusted EBITDA growth target. Having achieved an average 32% adjusted EBITDA growth over the last two years, and with yet another quarter of nearly 30% EBITDA growth on a business with high visibility, can you help us understand how you think about the puts and takes of your 20% long-term EBITDA growth target?

Speaker #7: Hi, this is Olivia Miles on for Michael Haas. Good morning and thanks for taking the question. I wanted to ask more on your long-term adjusted EBITDA growth target, having achieved an average 32% adjusted EBITDA growth over the last two years.

Speaker #7: And with yet another quarter of nearly 30% EBITDA growth on a business with high visibility, can you help us understand how you think about the puts and takes of your 20% long-term EBITDA growth targets?

Speaker #7: Specifically, I'm interested in which factors are developments could cause you to revisit and potentially raise your multi-year view on EBITDA growth. Thank you.

Olivia Miles: Specifically, I'm interested in which factors or developments could cause you to revisit and potentially raise your multi-year view on EBITDA growth. Thank you.

Speaker #3: Yeah, thanks for the question, Olivia. So look, I mean, you've seen how we've performed. And slide 12 just speaks for itself. We said we're going to target around 20%.

Parth Mehrotra: Yeah. Thanks for the question, Olivia. Look, you've seen how we've performed, slide 12 just speaks for itself. We said we're gonna target around 20%. We've said it can be higher or lower in any particular year. We've doubled EBITDA on a rolling three-year basis, as you noted, in a pretty challenging MA environment, which if you asked us that four years ago, could we do that, we would have probably said no. It just speaks to the execution of the people, on the team here and how well we've just continued to expand this business. The drivers are multitudinal here. We're looking to grow organically in the states we are in. We're looking to make acquisitions. We're looking to continue to perform in value-based arrangements, grow our practices, same store, use our balance sheet capital.

Speaker #3: We've said it can be higher, lower, in any particular year. We've doubled EBITDA on a rolling three-year basis, as you noted, in a pretty challenging MA environment, which if you asked us that four years ago, could we do that, we would have probably said no.

Speaker #3: But it just speaks to the execution of the people on the team here and how well we've just continued to expand this business. And the drivers are multitudinal here.

Parth Mehrotra: It just speaks to the execution of the people, on the team here and how well we've just continued to expand this business. The drivers are multitudinal here. We're looking to grow organically in the states we are in. We're looking to make acquisitions. We're looking to continue to perform in value-based arrangements, grow our practices, same store, use our balance sheet capital.

Speaker #3: We're looking to grow organically in the states we are in. We're looking to make acquisitions. We're looking to continue to perform in value-based arrangements, grow our practices same store.

Speaker #3: Use our balance sheet capital. So, I think all of those factors will play out over the next many years. I think we're going to continue to target that level.

Parth Mehrotra: I think all of those factors will play over the next many years. I think we're going to continue to target that level, but I think, again, some years it will be higher, some years it will be lower, some years we will have acquisitions that will contribute. I think we're just going to keep targeting that. The overall TAM for us is pretty large. There are about 1,000,001 clinicians in the country. Even if the addressable TAM is half of that's 600,000 non-facility-based providers, and we are just around 6,000 with our guidance for this year. I think the ability for us to continuing to expand that platform, add providers, add lives, and just continue the playbook.

Speaker #3: But I think, again, it'll be some years it'll be higher, some years it'll be lower, some years we'll have acquisitions that'll contribute. And so I think we're just going to keep targeting that.

Speaker #3: I mean, the overall TAM for us is pretty large. There are about a million one clinicians in the country. Even if the addressable TAM is half of that, that's 600,000.

Parth Mehrotra: Even if the addressable TAM is half of that's 600,000 non-facility-based providers, and we are just around 6,000 with our guidance for this year. I think the ability for us to continuing to expand that platform, add providers, add lives, and just continue the playbook.

Speaker #3: Non-facility-based providers. And we are just around 6,000 with our guidance for this year. And so I think the ability for us to continuing to expand that platform at providers, at lives, and just continue the playbook.

Speaker #3: The fact that we are already at a pretty healthy EBITDA margin—towards the low end of our long-term range—and that's why we're saying we can get to the high end of that range, continuing to get operating leverage to help us.

Parth Mehrotra: The fact that we are already at a pretty healthy EBITDA margin, towards the low end of our long-term range, and that is why we are saying we can get to the high end of that range, continue to get operating leverage to help us, at this scale, I think just speaks for itself. As we 2x or 3x our platform on providers, the unit economics has already played out, which is great for this business. I think we will just continue to execute over the next many years.

Speaker #3: At this scale, I think just speaks for itself. So as we 2x or 3x our platform on providers, the unit economics has already played out, which is great for this business.

Speaker #3: So I think we'll just continue to execute over the next many years.

Operator: Thank you. Our next question comes from the line of John Pinney of Canaccord Genuity. Please go ahead, John.

Speaker #2: Thank you. Our next question comes from the line of John Penny of Canaccour Genuity. Please go ahead, John.

Operator: Hi, John Pinney on for Richard Close. Thanks for the question. Yeah, I just wanted to touch again on the AI initiatives. Is there anything that has been surprising to you as far as the cost of the compute and the token use? And just generally, how are you thinking about managing AI spend? Thanks.

John Pinney: Hi, John Pinney on for Richard Close. Thanks for the question. Yeah, I just wanted to touch again on the AI initiatives. Is there anything that has been surprising to you as far as the cost of the compute and the token use? And just generally, how are you thinking about managing AI spend? Thanks.

Speaker #5: Hi, John Penny on for Richard Close. Thanks for the question. So yeah, I just wanted to touch on, again, on the AI initiatives. Is there anything that's been surprising to you as far as the cost of the compute and the token use and just generally how are you thinking about managing AI spend?

Speaker #5: Thanks.

Speaker #3: Yeah, I mean, I'm glad you asked because in our prepared remarks, we just link it to EBITDA margin expansion. So our view is whether the companies we partner with are embedding some of the technology to improve the workflows or if we are spending directly.

Parth Mehrotra: Yeah, I'm glad you asked because, in our prepared remarks, we just link it to EBITDA margin expansion. Our view is whether the companies we partner with are embedding some of the technology to improve the workflows, or if we are spending directly with our dev team using some of the models. Ultimately, we are expensing a lot of this on the P&L, and we are measuring it at a very micro level by workflow, time saved, outcomes achieved, costs saved, so on and so forth. Ultimately, we're tying it to increasing EBITDA margins. I don't think our view is that we need to overly spend on technology without seeing the resulting margins compress. I think we'll just manage it with our guidance, and that's our view.

Speaker #3: With our dev team, using some of the models, ultimately we are expensing a lot of this on the P&L. And we are measuring it at a very micro level.

Speaker #3: By workflow, time saved, outcomes achieved. Cost saved. So on and so forth. Ultimately, we're tying it to increasing EBITDA margin. So I don't think our view is that we need to overly spend on technology without seeing the resulting margins compress.

Parth Mehrotra: Ultimately, we're tying it to increasing EBITDA margins. I don't think our view is that we need to overly spend on technology without seeing the resulting margins compress. I think we'll just manage it with our guidance, and that's our view.

Speaker #3: So I think we'll just manage it with our guidance and that's our view that if and it's like every other technology cycle over the past many years, a lot of the innovations, I think this one has the potential to disrupt existing workflows in a much more meaningful manner in a positive way.

Parth Mehrotra: It's like every other technology cycle over the past many years, a lot of the innovations, I think this one has the potential to disrupt existing workflows in a much more meaningful manner, in a positive way. Our focus is on accreting EBITDA as we use this technology, and increasing margins. I think we'll just continue to do that.

Speaker #3: But our focus is on creating EBITDA as we use this technology and increasing margins. So I think we'll just continue to do that.

Speaker #2: Thank you. Our next question comes from the line of David Larson of BTIG. Please go ahead, David.

Operator: Thank you. Our next question comes from the line of David Larsen of BTIG. Please go ahead, David.

Jenny Shen: Hi, this is Jenny Shen on for Dave. Thanks for taking my question. I was just wondering if you could provide some updated thoughts on cost and volume trends in the quarter, maybe compared to last quarter or a year ago, and whether you've seen any notable pockets of higher acuity and any notable shifts in the acuity mix. Thanks.

Speaker #6: Hi, this is Jenny Shen on for David. Thanks for taking my question. I was just wondering if you could provide some updated thoughts on cost and volume trends in the quarter, maybe compared to last quarter or a year ago.

Speaker #6: And whether you've seen any notable pockets of higher acuity and any notable shifts in the acuity mix. Thanks.

Speaker #3: Yeah, thanks for the question, Jenny. So, yeah, there's not much to speak to. I mean, again, we look at it on an annual basis. I think it's tough to compare quarter over quarter, given any quarter has accruals for the current year and true-ups from the past year.

Parth Mehrotra: Thanks for the question, Jenny. There's not much to speak. Again, we look at it on an annual basis. I think it's tough to compare it quarter over quarter, given any quarter has accruals for the current year, true-ups from the past year. I think you just got to look at it on an annual basis. I think some of the inpatient utilization trends help us, as they've been ebbing down. Ambulatory utilization's pretty good, as you can see in our fee-for-service book. That's good utilization because that means folks are seeing their primary care providers and/or first point of contact in the system on a much more regular basis. Overall, look, our shared savings accruals speak for themselves in the results. Our increased guidance just reflects all that. There's nothing notable that we would point out year over year that has changed.

Speaker #3: So I think you just have to look at it on an annual basis. I think some of the inpatient utilization trends help us, as they've been heading down.

Speaker #3: Ambulatory utilization is pretty good, as you can see in our FIFA service book. And that's good utilization because that means folks are seeing their primary care providers and/or first point of contact.

Parth Mehrotra: Ambulatory utilization's pretty good, as you can see in our fee-for-service book. That's good utilization because that means folks are seeing their primary care providers and/or first point of contact in the system on a much more regular basis. Overall, look, our shared savings accruals speak for themselves in the results. Our increased guidance just reflects all that. There's nothing notable that we would point out year over year that has changed.

Speaker #3: And the system on a much more regular basis. So overall, look, our shared savings accruals speak for themselves in the results. Our increased guidance just reflects all that.

Speaker #3: So but there's nothing notable that we would point out year over year that has changed. If anything, I think we're performing pretty well in our value-based book.

Parth Mehrotra: If anything, I think we're performing pretty well in our value-based book, and that just speaks to the diversified nature of our platform, where we benefit from these trends.

Speaker #3: And that just speaks to the diversified nature of our platform where we benefit from these trends.

Speaker #2: Thank you. Gentlemen, we have no further questions. Please continue.

Operator: Thank you. Gentlemen, we have no further questions. Please continue.

Speaker #3: Yeah, thank you for listening to our call today. We appreciate your continued interest and look forward to discussing our performance next quarter.

Parth Mehrotra: Thank you for listening to our call today. We appreciate your continued interest and look forward to discussing our performance next quarter.

Operator: This concludes today's conference call. Thank you for participating. You may now disconnect.

Q2 2026 Privia Health Group Inc Earnings Call

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