PRVA

Privia Health has been treading water for the past six months, recording a small loss of 1.7% while holding steady at $21.63. The stock also fell short of the S&P 500’s 11.3% gain during that period. Is there a buying opportunity in Privia Health, or does it present a risk to your portfolio? Check out our in-depth research report to see what our analysts have to say, it’s free. We’re cautious about Privia Health. Here are three reasons why PRVA doesn’t excite us, plus one stock we’d rather own. Larger companies benefit from economies of scale, where fixed costs like infrastructure, technology, and administration are spread over a higher volume of goods or services, reducing the cost per unit. Scale can also lead to bargaining power with suppliers, greater brand recognition, and more investment firepower. A virtuous cycle can ensue if a scaled company plays its cards right. With just $2.36 billion in revenue over the past 12 months, Privia Health lacks scale in an industry where it matters. This makes it difficult to build trust with customers because healthcare is heavily regulated, complex, and resource-intensive. Free cash flow isn’t a prominently featured metric in company financials and earnings releases, but we think it’s telling because it accounts for all operating and capital expenses, making it tough to manipulate. Cash is king. Privia Health has shown mediocre cash profitability relative to peers over the last five years, giving the company fewer opportunities to return capital to shareholders. Its free cash flow margin averaged 4.7%, below what we’d expect for a healthcare business. Growth gives us insight into a company’s long-term potential, but how capital-efficient was that growth? Enter ROIC, a metric showing how much operating profit a company generates relative to the money it has raised (debt and equity). Privia Health’s five-year average ROIC was negative 7.9%, meaning management lost money while trying to expand the business. Its returns were among the worst in the healthcare sector. Privia Health’s business quality ultimately falls short of our standards. With its shares trailing the market in recent months, the stock trades at 19.6× forward P/E (or $21.63 per share). While this valuation is fair, the upside isn’t great compared to the potential downside. We’re fairly confident there are better stocks to buy right now. Let us point you toward a dominant aerospace business that has perfected its M&A strategy. WHILE YOU’RE HERE: Top 9 Market-Beating Stocks. The best stocks don’t just beat the market once. They do it again. And again. Robust revenue growth, rising free cash flow, returns on capital that leave their competition in the dust. The market has already rewarded these businesses. But our AI platform says the party isn’t over. Find out which 9 stocks made the cut this week — FREE. Get Our Top 9 Market-Beating Stocks for Free HERE. Stocks that have made our list include now familiar names such as Nvidia (+1,460% between June 2020 and June 2025) as well as under-the-radar businesses like the once-small-cap company Exlservice (+271% between June 2020 and June 2025). Find your next big winner with StockStory today.

Privia Health’s second quarter results were met with a negative market reaction as investors digested the company’s strong revenue growth alongside a material shortfall in non-GAAP profit relative to Wall Street expectations. Management attributed the top-line performance to robust provider signings and expanded value-based attributed lives, noting that implemented provider growth of 10.1% and value-based attributed lives growth of 19.2% drove overall practice collections. CEO Parth Mehrotra pointed to “strong new provider signings across all our markets,” while CFO David Mountcastle highlighted operational leverage and ongoing investments. Is now the time to buy PRVA? Find out in our full research report (it’s free). Revenue: $632.6 million vs analyst estimates of $597.2 million (21.4% year-on-year growth, 5.9% beat) Adjusted EPS: $0.19 vs analyst expectations of $0.24 (22.2% miss) Adjusted EBITDA: $37.43 million vs analyst estimates of $36.88 million (5.9% margin, 1.5% beat) Operating Margin: 1.9%, up from 0.6% in the same quarter last year Sales Volumes rose 10.1% year on year (13.8% in the same quarter last year) Market Capitalization: $2.75 billion While we enjoy listening to the management’s commentary, our favorite part of earnings calls is the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention. Elizabeth Anderson (Evercore ISI) asked about the risk of delayed CMS shared savings payments and how investors should monitor for updates. CEO Parth Mehrotra indicated there was little concern, citing historical reliability and describing any delay as a matter of timing, not risk. Matthew Mardula (William Blair) queried why management is confident in reaching the high end of its long-term EBITDA margin target. CFO David Mountcastle pointed to operational leverage, AI initiatives, and the maturity of existing markets as drivers, but offered no firm timeline. Daniel Grosslight (Citi) pressed on the apparent deceleration in second-half practice collections growth. Mehrotra responded that the guidance is "prudent" rather than reflecting specific headwinds, and that ambulatory utilization trends remain favorable. A.J. Rice (UBS) requested more detail on AI use cases. Mehrotra emphasized deployment across corporate and care workflows, including billing, clinical decision support, and patient experience, all aimed at compressing costs and supporting margin expansion. Ryan Langston (TD Cowen) asked about the integration and performance of the Evolent and IMS acquisitions. Mehrotra described both as progressing well and contributing to updated guidance, with Arizona highlighted as a target for further expansion. In the coming quarters, the StockStory team will watch (1) the pace of AI-enabled efficiency gains and their impact on operating margins, (2) progress in onboarding new providers and further expansion into new states, and (3) updates on value-based contract performance and any regulatory changes impacting cash flow timing. Execution on recent acquisitions and the development of local market density will also be critical markers of sustainable growth. Privia Health currently trades at $21.71, down from $23.96 just before the earnings. In the wake of this quarter, is it a buy or sell? The answer lies in our full research report (it’s free for active Edge members). WHILE YOU’RE HERE: Top 9 Market-Beating Stocks. The best stocks don’t just beat the market once. They do it again. And again. Robust revenue growth, rising free cash flow, returns on capital that leave their competition in the dust. The market has already rewarded these businesses. But our AI platform says the party isn’t over. Find out which 9 stocks made the cut this week — FREE. Get Our Top 9 Market-Beating Stocks for Free HERE. Stocks that have made our list include now familiar names such as Nvidia (+1,460% between June 2020 and June 2025) as well as under-the-radar businesses like the once-small-cap company Comfort Systems (+1,154% between June 2020 and June 2025). Find your next big winner with StockStory today.

Image source: The Motley Fool. Thursday, Aug. 6, 2026 at 8:00 a.m. ET SVP of Investor and Corporate Communications - Robert Borchert CEO - Parth Mehrotra Chief Financial Officer - David Mountcastle Operator: Thank you for standing by, and welcome to Privia Health's Second Quarter 2026 Earnings Conference Call. [Operator Instructions] I would now like to hand the call over to Robert Borchert, SVP of Investor and Corporate Communications. Please go ahead. Robert Borchert: 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. 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. Today's reported results are preliminary and are not final until our Form 10-Q for the second quarter and 6-month period ended June 30, 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 of our business as of August 6, 2026. 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. Reconciliation of these measures to comparable GAAP measures are included in our press release and the accompanying slide presentation posted on our website. And now I'd like to turn the call over to our CEO, Parth Mehrotra. Parth Mehrotra: 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. 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. 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. 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% of care margin over the next few years. In late May, we announced entry into the state of New Jersey in partnership with the Urology Group of Bergen County, a practice for 25 adult and pediatric clinicians. This represents Privia's 25th state as we build our national primary care-centric delivery network. 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. 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. 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 3 years. 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. 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 7 shows the scale and breadth of Privia's ACOs. 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. 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. David Mountcastle: Thank you, Parth. Privia Health's strong operational execution and growth continued through the second quarter. Implemented providers grew 109 sequentially from Q1 to reach 5,644 at June 30, 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. 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. 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 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. 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. 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 deployment 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. 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. 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 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 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. As a reminder, our guidance does not assume any additional business development activity. 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. 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. Operator: [Operator Instructions] Our first question comes from the line of Elizabeth Anderson of Evercore ISI. Elizabeth Anderson: 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 the fourth quarter? And how should we think about sort of external signposts we can watch to monitor that? Parth Mehrotra: Yes. I mean we're not that worried about it. They've been really good over the past many years. Usually, results come in August, September. 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. I just think the changes that they 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. I think whether it comes early November, late November, December, I mean, that's just -- it will happen when it happens, but I don't think it's a big concern for us. Operator: Our next question comes from the line of Ryan Daniels of William Blair. Matthew Mardula: This is Matthew Mardula on for Ryan Daniels. 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. 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? And then any directional time line on when this could be achieved? Is it maybe in the next few years or more of a longer-term target of 5 years? David Mountcastle: Yes. Thanks for the question, Matt. So I mean, we covered this a little bit last quarter as well. I mean, if you see our guidance, we expect to be 29% this year 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, we're just scaling our business with growth, I think we're pretty confident that we can keep accreting that. There's no set time line. I mean 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 5 years ago. 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. So that gives us the confidence that as we mature some of the other newer markets, overall, the profitability should keep trending up. Operator: Our next question comes from the line of Daniel Grosslight of Citi. Daniel Grosslight: 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. 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. 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? Parth Mehrotra: Yes. Thanks for the question, Dan. Yes, there's nothing much in the implied. I mean we've done this for 21 quarters. You've seen how we guide 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. 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 is 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 doesn't really apply to a business like Privia. 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. Operator: Our next question comes from the line of A.J. Rice of UBS. Albert Rice: I know there are a variety of drivers to give you confidence on that margin improvement over time, operating leverage, obviously, shared risk performance, value-based performance. 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. Parth Mehrotra: Yes, I appreciate the question, A.J. So I think we covered this in a fair bit of detail on the last call, but we are looking at our 4 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 patients. So 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. And then our dev teams are continuing to see where we can build, buy, partner. So 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. 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. 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. 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. 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. And so I think, again, we're really excited. A business like ours is a perfect use case in deploying a lot of these applications as they evolve over time. And so I think we'll just continue in that journey over the next few years. Operator: Our next question comes from the line of Jailendra Singh of Truist. Jailendra Singh: Congrats on a strong quarter. I want to ask about the New Jersey entry. I know it's a small sized initial anchor practice. But just to confirm, did that have any impact to your guidance on any metric? 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? Parth Mehrotra: Yes. Thanks for the question, Jailendra. Yes, I mean, pretty small practice, but really good set of providers. We're really excited to partner with them. It's a very important state from a health care 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. So it's been on our -- it was on our radar for a while, and we're glad to just finally enter. 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. I mean, 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. 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 a small contribution. But overall, we've just had a good first 6 months, so that reflects in our guidance. Operator: Our next question comes from the line of Ryan Langston of TD Cowen. Ryan Langston: Just maybe any updates on how the Evolent and IMS transactions from last year are progressing this year? Parth Mehrotra: Yes. Thanks, Ryan. Yes, 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. 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. I think it will 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 Evolent business that we bought. The Care Partners business will continue to grow, hopefully, and it will 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 will 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. So, we're pretty excited, just going to grind it out quarter-by-quarter, month by month and just keep building those businesses. Operator: Our next question comes from the line of Sean Dodge of BMO Capital Markets. Thomas Kelliher: This is Thomas Kelliher on for Sean. 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? And how has that value prop evolved over the last few years or so as you built all this density and continue to strengthen and scale the value-based care business? Parth Mehrotra: Yes. I appreciate the question, Tom. So I mean, this is a question that should come up much earlier in our journey as a public company as we're explaining the story. But like that thesis has only improved over time over the past 5 years as we build density. So, 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 or facility-based providers. So, 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. 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. 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. 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 multi 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. So you add all that up over time, and it can range from 15%, 20% to as high as 50%. 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. 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 5-, 7-year period and really build these businesses at the small-scale level. 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. So, you can see that in the flywheel and our growth rates over the past 8, 9 years on Slide 12, and that contributes to the same-store growth. So really excited about continuing to just have that play out. Operator: Our next question comes from the line of Andrew Mok of Barclays. Unknown Analyst: 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? David Mountcastle: Can you repeat that again? You said provider expenses? Unknown Analyst: Provider expense. So I think it was a little bit -- it was $500 million in the quarter. Just wondering what the delta between balance sheet is. David Mountcastle: Yes. I think you got to just take a look at an annual -- on an annual basis. I mean, I'm assuming you're referring to the disclosure on Page 9 of our press release. 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 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: Our next question comes from the line of Matthew Gillmor of KeyBanc. Matthew Gillmor: 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. Parth Mehrotra: Yes. Thanks, Matt. Yes, I think as you summarize, like overall, we think it's positive. I think CMS continues to refine the program for the better. 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 5 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. And then I think there's still some work to be done in our minds where you don't need 3 or 4 programs. I mean they tried REACH, now they have Lead. 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 overall. 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. So I think CMS appropriately wants to make sure that they keep doing right by community-based providers who are participating in this. 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 will just get better. 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, but really, really happy about it. Operator: Our next question comes from the line of Whit Mayo of Leerink Partners. Benjamin Mayo: 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? David Mountcastle: Yes. Thanks for the question. Yes, we don't break that out because it just changes every quarter. So 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. 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 5 to 6 months to implement every provider from the sale and the business becomes, therefore, very predictable 9 to 12 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 a fee-for-service basis. So I think that just bodes well, and I think we'll just continue to play on all those levers like try to grow these practices same-store and try to keep adding new providers. But it's tough to just break out in one particular quarter or half a year because that just changes. Operator: Our next question comes from the line of Matthew Shea of Needham. Matthew Shea: Congrats on the nice quarter here. Maybe on go-to-market, you're running the 2 go-to-market motions now the full medical group and the wider ACO-only model. How is the 2-pronged strategy done so far into 2026? Anything interesting to call out? And obviously, we can see the adoption of the full medical group and implemented providers, but it would be good to hear specifically how the ACO-only model is resonating. I mean any notable additions there? Parth Mehrotra: Yes, I appreciate the question. I mean it's still a little bit early for us. We just bought the business, closed it in -- by the end of last year and integrated it. 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. And so I think it allows us to enter into partnerships with a much more bigger TAM, if you will. It also allows us to follow up that one particular acquisition with other tuck-in acquisitions that's 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. 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. 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 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 will be a good addition. 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. So I think -- it will play out over the next 4, 5 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. Operator: Our next question comes from the line of Jessica Tassan of Piper Sandler. Jessica Tassan: Congrats on the strong results again. So we have cost of platform coming in at about 52.5% of care margin, which is down 400 bps year-over-year. Should we still think about the cost of platform as kind of the cost associated with third-party EHR software? And then just does 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? David Mountcastle: Yes, 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 1 quarter or 1 half also 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. Like I said, it's a combination of both the cost of platform and SG&A. So I think it will just keep improving hopefully, over time. And there are different levers. I mean, technology spend is one. We don't capitalize any software, as you know. It's all expensed in the P&L. But then 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 cost, variable costs. So I think it's a combination of all of those that we'll continue to hopefully scale over time. And yes, we have levers in our contracts that as we get bigger, we scale those costs appropriately. 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. And I think if you look at over the -- look at Slide 12, over the past 9 years, I mean, 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. So hopefully, we'll just keep doing that. Operator: Our next question comes from the line of Jack Slevin of Jefferies. Jack Slevin: Congrats on the quarter. I just want to double-click a little bit a bit on the BD side of things for the ACO business. 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? Parth Mehrotra: Yes. Good question. So 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. And so I think that's helpful. We didn't have that before. And then obviously, there are acquisition opportunities of all scale and size. which we continue to evaluate. 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. 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. So 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. So I think it will 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. I mean that was the easy play. A lot of it got funded in 5, 6 years ago, private equity, venture capital, smaller entities trying to do it, 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: Our next question comes from the line of Ryan Halsted of RBC. Ryan Halsted: 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. I appreciate that. Parth Mehrotra: Yes, 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 5 years. The payers go through their cycle. I think some of the changes in B-28 changes in the exchange population, redetermination in Medicaid, et cetera, have just caused a little bit more of a disruption this cycle. 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. And we take that network in a very sophisticated manner to payers of health car. 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 a really important partner to them 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. I think primary care has 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. 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. 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. It's not like populations are changing massively. So 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. So I think it bodes well for a business like ours to continue to capitalize on whatever might happen in the payer landscape. Operator: Our next question comes from the line of Olivia Miles of Baird. Olivia Miles: This is Olivia on for Michael Ha. I wanted to ask more on your long-term adjusted EBITDA growth target, having achieved an average 32% adjusted EBITDA growth over the last 2 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 multiyear view on EBITDA growth. David Mountcastle: Yes. Thanks for the question, Olivia. So look, I mean, you've seen how we performed and Slide 12 just speaks for itself. We said we're going to target around 20%. We've said it can be higher or lower in any particular year. We've doubled EBITDA on a rolling 3-year basis, as you noted, in a pretty challenging MA environment, which if you asked us that 4 years ago, could we do that? We would have probably said no. 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. We're looking to grow organically in the states we are in. We're looking to make acquisitions. We are looking to continue to perform in value-based arrangements, grow our practices same-store, use our balance sheet capital. So 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, it will be -- some years, it will be higher, some years, it will be lower. Some years we'll have acquisitions that will contribute. And so, I think we're just going to keep targeting that. I mean the overall TAM for us is pretty large. There are about 1.1 million clinicians in the country. Even if the addressable TAM is half of that, that 600,000 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, add providers, add lives and just continue the playbook. 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, continue to get operating leverage to help us 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. So I think we'll just continue to execute over the next many years. Operator: Our next question comes from the line of John Pinney of Canaccord Genuity. John Pinney: John Pinney on for Richard Close. So I just wanted to touch on the -- again, on the AI initiatives. Is there anything that's been surprising to you as far as like the cost of the compute and the token use? And just generally, how you're thinking about managing AI spend? Parth Mehrotra: Yes. 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 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, 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. 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. But our focus is on accreting EBITDA as we use this technology and increasing margins. So I think we'll just continue to do that. Operator: Our next question comes from the line of David Larsen of BTIG. Jenny Shen: This is Jenny Shen on for David. 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? David Mountcastle: Thanks for the question, Jenny. So yes, there's not much to speak. I mean, 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. So, 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 is pretty good, as you can see in our fee-for-service book. And 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. So overall, look, our shared savings accruals speak for themselves in the results. Our increased guidance just reflects all that. 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, and that just speaks to the diversified nature of our platform where we benefit from these trends. Operator: Gentlemen, we have no further questions. Please continue. David Mountcastle: Yes. 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. 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This article is a transcript of this conference call produced for The Motley Fool. While we strive for our Foolish Best, there may be errors, omissions, or inaccuracies in this transcript. As with all our articles, The Motley Fool does not assume any responsibility for your use of this content, and we strongly encourage you to do your own research, including listening to the call yourself and reading the company's SEC filings. Please see our Terms and Conditions for additional details, including our Obligatory Capitalized Disclaimers of Liability. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. Privia Health (PRVA) Q2 2026 Earnings Call Transcript was originally published by The Motley Fool

Interested in Privia Health Group, Inc.? Here are five stocks we like better. Strong Q2 performance: Privia Health’s implemented providers grew 10.1%, attributed lives increased 19.2%, and practice collections rose 12.4% to $970 million. Adjusted EBITDA climbed 29% year over year to $37.4 million. 2026 outlook raised: Management lifted guidance for attributed lives, practice collections, GAAP revenue, care margin, platform contribution and adjusted EBITDA after strong first-half execution. The company ended the quarter with more than $412 million in cash and no debt. Expansion and cash-flow timing: Privia expanded into New Jersey and now operates across 25 states and Washington, D.C., managing more than 1.64 million attributed lives. Potential CMS changes could delay 2025 shared-savings payments by roughly 30–45 days, affecting year-end cash flow but not expected collections. Privia Health Group (NASDAQ:PRVA) reported second-quarter results marked by double-digit growth in implemented providers, attributed lives and practice collections, while adjusted EBITDA rose 29% from a year earlier. Management also raised its 2026 outlook for several financial measures following what Chief Executive Officer Parth Mehrotra described as strong first-half execution. The company said implemented providers increased 10.1% year over year to 5,644 as of June 30, while value-based attributed lives rose 19.2%. Total practice collections grew 12.4% to $970 million during the quarter. Adjusted EBITDA increased to $37.4 million, representing 28.3% of care margin and a 310-basis-point improvement from the prior-year period. → Meta’s Earnings Drop Shows Wall Street Wants More Than Ad Growth For the first half of 2026, practice collections increased 13.4% to $1.88 billion, care margin rose 18.3%, and adjusted EBITDA climbed 32.5% to $74.1 million, according to Chief Financial Officer David Mountcastle. Mountcastle said Privia raised its 2026 outlook for attributed lives above the high end of its prior guidance range. The company also increased expectations to the high end of prior ranges for practice collections and GAAP revenue, and to the mid-to-high end of ranges for care margin, platform contribution and adjusted EBITDA. → 4 Oil and Gas ETF Plays as Prices Stay Sky-High The company did not change its outlook for implemented providers. At the midpoint of that guidance, Privia expects to add 570 providers in 2026, or growth of 10.6% over 2025, Mehrotra said. When asked about guidance implying slower practice-collections growth in the second half, Mehrotra said the outlook reflected the company’s customary prudence rather than specific operational headwinds. He said ambulatory utilization remained favorable and noted that inpatient utilization trends reported by health systems do not directly apply to Privia’s business model. → Ulta's Growth Is Real, But So Are the Risks Privia ended the quarter with more than $412 million in cash and no debt. Mountcastle said the company expects 70% to 80% of full-year adjusted EBITDA to convert to free cash flow, excluding capital deployment for business development and assuming it receives a significant portion of shared-savings cash payments for 2025 performance by year-end. Management said proposed changes from the Centers for Medicare & Medicaid Services to the Medicare Shared Savings Program could delay final reconciliation results for the 2025 performance year until November if finalized. While Mountcastle said the development would have minimal impact on accruals, it could create an unusual year-end cash-flow dynamic depending on when CMS distributes payments and when Privia subsequently pays providers. Mehrotra said the company was not concerned about ultimately receiving the payments. He said CMS has historically delivered results in August or September, followed by cash settlements around October, and characterized the potential delay as approximately 30 to 45 days. Management viewed the broader MSSP proposals favorably. Mehrotra cited potential changes involving attribution, the addition of providers who have not previously participated in an ACO, and rebasing as constructive for the program. He said Privia remains supportive of direct contracting with the government through MSSP and expects the program to continue evolving. In late May, Privia announced its entry into New Jersey through a partnership with Neurology Group of Bergen County, which has 25 adult and pediatric clinicians. The move marked Privia’s 25th state. Mehrotra said the practice was too small to materially affect guidance but described New Jersey as an important market with substantial healthcare spending and independent-provider opportunities. The company now operates across 25 states and the District of Columbia, with more than 1,300 care center locations serving over 6.1 million patients. Privia said it has averaged 98% gross provider retention over the past three years. Privia managed more than 1.64 million attributed lives across over 130 commercial and government value-based care programs. Commercial attributed lives rose 11.7% to 942,000. Attributed lives in CMS Medicare programs increased 55%, while Medicare Advantage and Medicaid attribution increased more than 12% and 18%, respectively. Mehrotra said Privia estimates it manages $15.7 billion in total medical spending through its value-based risk arrangements. He said the company’s goal is to continue increasing attribution while generating positive contribution margin across its value-based business. Management said it expects to move EBITDA margin toward the high end of its long-term target range of 30% to 35% of care margin over the next several years. Privia expects adjusted EBITDA to equal roughly 29% of care margin in 2026, Mehrotra said, placing the company near the low end of that long-term range. The company cited scaling operations, maturation of newer markets and deployment of artificial intelligence tools as drivers of further margin expansion. Mehrotra said Privia is evaluating AI applications across corporate functions, fee-for-service workflows, value-based care workflows and patient-care processes. Potential uses include revenue-cycle activities, patient experience, clinical decision-making, coding compliance and identifying suspect medical conditions. Mehrotra said Privia is measuring AI investments at a detailed workflow level based on time saved, outcomes achieved and costs reduced, and is tying its technology deployment to EBITDA margin improvement rather than pursuing spending without returns. Privia also said its acquisitions of IMS and Evolent’s Care Partners business are progressing well and have been integrated into its operating cadence. Mehrotra said the Arizona-based IMS business provides momentum in a new state, while Care Partners expands Privia’s ability to work with providers through an ACO-focused model, including in markets where the company has not yet established a full medical group. Privia Health Group (NASDAQ: PRVA) is a physician enablement company that partners with independent physicians, medical groups and health systems to transform the delivery of patient care. Through a clinically integrated network and a proprietary technology platform, the company supports providers in managing population health, delivering coordinated care and optimizing financial performance under both fee-for-service and value-based reimbursement models. Founded in 2016 and headquartered in McLean, Virginia, Privia Health has rapidly expanded its footprint to serve multiple metropolitan markets across the United States. This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to [email protected]. The article "Privia Health Group Q2 Earnings Call Highlights" was originally published by MarketBeat. 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2Q’26 Net Income of $9.0M, +236.7% from 2Q’25 2Q’26 Adjusted EBITDA of $37.4M, +29.1% from 2Q’25 Full-Year 2026 Guidance Raised for All Key Financial Metrics ARLINGTON, Va., Aug. 06, 2026 (GLOBE NEWSWIRE) -- Privia Health Group, Inc. (Nasdaq: PRVA) today announced financial results for the second quarter and six-month periods ended June 30, 2026. Second Quarter Performance Key Operating and Non-GAAP Financial Metrics c Six-Month Performance Key Operating and Non-GAAP Financial Metrics b d e Updated Full-Year 2026 Guidance d e f g Expect approximately 70-80% of Adjusted EBITDA to convert to free cash flow in full-year 2026 subject to timing of MSSP cash settlement Guidance does not assume any new business development activity d. Management has not reconciled forward-looking non-GAAP measures to their most directly comparable GAAP measures of Gross Profit, Operating Income and Net Income. This is because the Company cannot predict with reasonable certainty and without unreasonable efforts the ultimate outcome of certain GAAP components of such reconciliations due to market-related assumptions that are not within our control as well as certain legal or advisory costs, tax costs or other costs that may arise. For these reasons, management is unable to assess the probable significance of the unavailable information, which could materially impact the amount of the future directly comparable GAAP measures. e. See “Key Metrics and Non-GAAP Financial Measures” for more information as to how the Company defines and calculates Implemented Providers, Attributed Lives, Practice Collections, Care Margin, Platform Contribution, and Adjusted EBITDA, and for a reconciliation of the most comparable GAAP measures to Care Margin, Platform Contribution, Adjusted EBITDA, Adjusted Net Income and Adjusted Net Income Per Share. f. Certain non-recurring or non-cash and other expenses will be treated as an add back in the reconciliation of Net Income to Adjusted EBITDA, and the reconciliation of Net Income to Adjusted Net Income and Adjusted Net Income Per Share, the details of which can be found in the Reconciliation schedules near the end of this and in future quarterly press releases. g. Any slight variations in totals due to rounding. Webcast and Conference Call Information The Company will host a conference call on August 6, 2026, at 8:00 am ET to discuss these results and management’s outlook for future financial and operational performance. You can visit ir.priviahealth.com/news-and-events/events-and-presentations to listen to the call via live webcast. The webcast will be archived and available for replay for on-demand listening shortly after the completion of the call under the same link. Go to https://register-conf.media-server.com/register/BI4c0355cb60f4473db6a27e261c9996e2 in order to pre-register and obtain your dial-in number and passcode to join the live conference call. This news release and the financial statements contained herein, and the slide presentation for the webcast, are also available on the Privia Health Investor Relations website at ir.priviahealth.com. About Privia Health Privia Health™ is one of the largest physician enablement companies in the United States with a presence in 25 states and the District of Columbia. Privia builds scaled provider networks with primary-care centric medical groups, risk-bearing entities, a physician-led governance structure, and the Privia Platform comprising an extensive suite of technology and service solutions. Privia collaborates with medical groups, health plans and health systems to optimize 1,300+ physician practices, improve the patient experience for 6.1+ million patients, and reward 5,600+ physicians and advanced practitioners for delivering high-value care. Privia’s mission is to transform healthcare delivery to achieve better outcomes, lower costs, and improve the health of communities and the well-being of providers. For more information, visit priviahealth.com. Non-GAAP Financial Measures The Company reports and discusses its operating results using financial measures consistent with accounting principles generally accepted in the United States ("GAAP"). From time to time, in press releases, financial presentations, earnings conference calls or otherwise, the Company may disclose certain non-GAAP financial measures. The non-GAAP financial measures presented in this press release should not be viewed as alternatives or substitutes for the Company's reported GAAP results. A reconciliation to the most directly comparable GAAP financial measure is set forth in the tables that accompany this release. The Company believes that the non-GAAP financial measures presented in this press release are relevant and provide useful information to the Company's management, investors, and other interested parties about the Company's operating performance because the measures allow them to understand and compare the Company's actual and expected operating results during the prior, current and future periods in a more consistent manner. The non-GAAP measures presented in this press release may not be comparable to similarly titled measures used by other companies. These non-GAAP financial measures are used in addition to and in conjunction with results presented in accordance with GAAP and reflect an additional way of viewing aspects of the Company's operations that, when viewed with GAAP results and the accompanying reconciliations to corresponding GAAP financial measures, provides a more complete understanding of the results of operations and trends affecting the Company's business. These non-GAAP financial measures should be considered as a supplement to, and not as a substitute for, or superior to financial measures calculated in accordance with GAAP. Safe Harbor Statement The financial results in this press release reflect preliminary, unaudited results, which are not final until the Company’s Form 10-Q is filed with the Securities and Exchange Commission (“SEC”). This press release contains "forward-looking statements" within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. Such statements relate to our current expectations, projections and assumptions about our business, the economy and future events or conditions. They do not relate strictly to historical or current facts. Forward-looking statements can be identified by words such as “aims,” “anticipates,” "assumes," “believes,” “estimates,” “expects,” “forecasts,” “future,” “intends,” “likely,” “may,” “outlook,” “plans,” “potential,” “projects,” “seeks,” “strategy,” “targets,” “trends,” “will,” “would,” “could,” “should,” and variations of such terms and similar expressions and references to guidance, although some forward-looking statements may be expressed differently. In particular, these include statements relating to, among other things, our future actions, business plans, objectives and prospects; and our future operating or financial performance and projections, including our full year guidance for 2026. Factors or events that could cause actual results to differ may emerge from time to time and are difficult to predict. Should known or unknown risks or uncertainties materialize, or should underlying assumptions prove inaccurate, actual results may differ materially from past results and those anticipated, estimated or projected. We caution you not to place undue reliance upon any of these forward-looking statements. Factors related to these risks and uncertainties include, but are not limited to: the heavily regulated industry in which we operate, and any failure by us or our medical groups to comply with the extensive applicable healthcare laws and government regulations; the complexity of the legal framework governing our relationships with Medical Groups, some of which we do not own, and Privia providers, and the impact of legal challenges or shifting interpretations of applicable laws; the execution of our growth strategy, which may not prove viable and we may not realize expected results; difficulties timely implementing our proprietary end-to-end, cloud-based technology solution for Privia physicians and new medical groups; the high level of competition in our industry; challenges in successfully establishing a presence in new geographic markets; the impact of failures by or service disruptions at key third-party vendors, such as our primary electronic medical record vendor, athenahealth, Inc.; potential decreases in reimbursement rates by governmental and third-party payers, changes to payment terms or challenges negotiating and retaining favorable contracts with private third-party payers, and changes impacting our patient population; the financial and operational impact of our compliance with various complex and changing federal and state privacy and security laws and regulations related to our use, disclosure, and other processing of personal information and protected health information, including the Health Insurance Portability and Accountability Act of 1996; the impact of actual and potential security threats, cybersecurity incidents or privacy or other forms of data breaches involving us, our vendors or other third parties; the continued availability of qualified workforce, including staff at our medical groups, and the continued upward pressure on compensation for such workforce; and other risk factors described in our Annual Report on Form 10-K for the year ended December 31, 2025 and the Company’s subsequent Quarterly Reports on Form 10-Q. All information in this press release is as of the date of the release, and the Company undertakes no duty to update this information unless required by law. (g) Any slight variations in totals due to rounding. (h) Any slight variations in totals are due to rounding. (i) Any slight variations in totals are due to rounding. Additional Financial Information Revenues disaggregated by source: The Company’s liabilities for unpaid medical claims under at-risk capitation arrangements: Key Metrics and Non-GAAP Financial Measures Privia Health reviews a number of operating and financial metrics, including the following key metrics and non-GAAP financial measures, to evaluate the Company’s business, measure performance, identify trends affecting the Company’s business, formulate business plans, and make strategic decisions. Key Metrics(j) Non-GAAP Financial Measures (5)(k) Reconciliation of Gross Profit to Care Margin(l) Reconciliation of Gross Profit to Platform Contribution(m) Reconciliation of Net Income to Adjusted EBITDA(n) Reconciliation of Net Income to Adjusted Net Income and Adjusted Net Income Per Share(o)

This article first appeared on GuruFocus. Release Date: August 06, 2026 For the complete transcript of the earnings call, please refer to the full earnings call transcript. Privia Health Group Inc (NASDAQ:PRVA) delivered strong operational execution with implemented provider growth of 10.1% and value-based attributed lives growth of 19.2% year-over-year, driving total practice collections growth of 12.4% in Q2 2026. Adjusted EBITDA increased 29% year-over-year, with EBITDA margin as a percentage of care margin expanding 310 basis points, demonstrating significant operating leverage. The company raised its 2026 outlook across all key financial metrics, including practice collections, care margin, and EBITDA, due to strong first-half performance and attributed lives above the high end of prior guidance. Privia Health Group Inc (NASDAQ:PRVA) expanded into its 25th state with the entry into New Jersey, partnering with Neurology Group of Bergen County, and maintains a robust pipeline for further market expansion. The company is deploying AI applications across four workflows (corporate, fee-for-service, value-based, and patient care), which is expected to drive EBITDA margin towards the high end of its 30-35% long-term target range. Privia Health Group Inc (NASDAQ:PRVA) maintains a strong balance sheet with over $412 million in cash and no debt, providing significant financial flexibility for capital deployment and acquisitions. The company's diversified value-based care portfolio, including commercial, Medicare Advantage, and Medicaid contracts, reduces dependence on any single program and supports sustainable growth. Gross provider retention averaged 98% over the past three years, reflecting the strength of the company's integrated model and partner value proposition. CMS proposed changes to the Medicare Shared Savings Program for performance year 2025 may delay final reconciliation results until November, potentially leading to an atypical year-end cash flow dynamic. The company's updated guidance implies a significant deceleration in practice collections growth in the second half of 2026 (around 3% year-over-year) compared to 13% in the first half, which management attributes to conservatism but could signal headwinds. Provider expenses increased to $500 million in the quarter, growing faster than revenue and exceeding some expectations, though management attributes this to pass-through payments reflecting business growth. Privia Health Group Inc (NASDAQ:PRVA) is now a full cash taxpayer starting in 2026, which could impact free cash flow conversion, expected at 70-80% of adjusted EBITDA. The company's entry into New Jersey is with a small initial practice (25 clinicians), and management notes it will be a 5-10 year play, indicating limited near-term contribution to financial metrics. The transition from ACO REACH to the new ACO LEAD program creates market disruption, and while it presents opportunities, it also introduces uncertainty in the ACO-only business model. Management acknowledged that the long-term EBITDA growth target of 20% could be revisited, but they continue to guide to that level despite recent performance averaging 32%, suggesting potential for underperformance in some years. Warning! GuruFocus has detected 3 Warning Sign with PRVA. Is PRVA fairly valued? Test your thesis with our free DCF calculator. Q: Can you provide more color on the drivers that give you confidence in reaching the high end of your long-term EBITDA margin target range of 30% to 35% of care margin, and what is the directional timeline for achieving this? A: Parth Mehrotra, CEO: We expect to be at 29% this year, which is very close to the 30% low end. Given the work we are doing with AI applications and scaling our business with growth, we are confident we can keep accreting that margin. There is no set timeline, but we said over the next few years. This was a target we set at our IPO about 5 years ago, and we are already at the low end. Many of our mature markets are already close to or above the high end, which gives us confidence that as newer markets mature, overall profitability will continue to increase. Q: The updated guidance implies a strong deceleration in practice collections growth from 13% in the first half to around 3% in the second half. What is driving that implied decelerationis it conservatism or specific headwinds? A: David Mountcastle, CFO: There is nothing much in the implied deceleration. We have done this for 21 quarters and are just being prudent and conservative since it is still the middle of the year. We moved the midpoint to the high end of the original range, and if trends continue, there should be further upside. We feel really good about ambulatory utilization trends, and the inpatient utilization trends reported by health systems don't really apply to a business like Privia. Q: Can you enumerate some of the AI use cases at the corporate or practice level that are driving improved efficiencies and margin expansion? A: Parth Mehrotra, CEO: We are looking at four workflows: corporate functions, fee-for-service workflows, value-based workflows, and the patient care experience. We are using Google's Gemini across corporate workflows and working with other tech companies. We are piloting many applications in patient experience, clinical decision-making, and revenue cycle workflows. We are measuring our ability to deploy these applications to see if things can be done better, faster, and cheaper. As we grow, we likely won't need to add a lot more headcount or fixed costs. Our investment in Navina for suspect medical conditions and coding compliance has already played out well. Q: Did the New Jersey entry with Neurology Group of Bergen County have any impact on guidance, and do you see that market evolving similarly to your more successful market launches? A: Parth Mehrotra, CEO: It is a pretty small practice but with a really good set of providers. New Jersey is a very important state from a healthcare spend perspective with a lot of independent providers. This will be a 5-10 year play for us, as our strategy is to build local density of providers across the state. Given the size and timing of the deal, it doesn't impact our metrics meaningfully, but it is a small contribution reflected in our guidance. Q: How are the Evalent and IMS transactions from last year progressing, and what are your expectations for those businesses? A: Parth Mehrotra, CEO: They are progressing really well, and we have integrated both into our operating cadence. The growth rates reflect those acquisitions, and our updated guidance reflects their good performance. We are excited about being in Arizona with IMS and building that medical group further. The Evalent (Care Partners) business will continue to grow and provides a way to partner with providers who may not choose to join our full medical group, ultimately serving as a good pipeline for expansion. Q: From a physician's perspective, how much do they typically benefit incrementally from joining the Privia platform, and how has that value proposition evolved as you've scaled? A: Parth Mehrotra, CEO: The value creation components include better fee-for-service contract rates, expense savings on technology, and a 10-20% productivity lift. We provide sophisticated machinery for providers to participate in value-based arrangements across their entire patient panel, transforming simple fee-for-service payments into a multitude of payments including care management fees and shared savings. The total benefit can range from 15-20% to as high as 50%. We also develop business plans for practices to organically grow, and we have case studies where we've doubled the size of practices over a 5-7 year period. Q: What are your thoughts on the CMS proposed changes to the Medicare Shared Savings Program (MSSP) financial methodology, and are there any noteworthy implications for Privia? A: Parth Mehrotra, CEO: Overall, we think it's positive. CMS continues to refine the program for the better, including changes on adding new providers, how attribution is measured, and rebasing. There is still work to be done on potentially merging programs like REACH and ACO REACH into MSSP, but it's a step in the right direction. We feel really good about MSSP and delivering shared savings, and part of our guidance increase reflects that. Q: Can you share how much of the implemented provider growth is coming from new physicians joining existing groups versus new groups affiliating with Privia? A: Parth Mehrotra, CEO: We don't break that out because it changes every quarter. On an annual basis, same-store growth is usually 1-2%, which includes both price and volume. We are growing same-store practices in a meaningful way, and the base keeps getting bigger. Since it takes 5-6 months to implement every provider, the business becomes very predictable 9-12 months out. By the time we give following-year guidance in January or February, 90% of the business is locked in on the fee-for-service basis. Q: How is the two-pronged go-to-market strategy (full medical group and ACO-only model) resonating in 2026, and are there any notable additions to the ACO-only model? A: Parth Mehrotra, CEO: It's still early days since we just closed and integrated the acquisition at the end of last year. It allows us to have many more conversations in states where we don't have a medical group entity set up. It also allows us to pursue tuck-in acquisitions of subscale ACO entities. We can run this playbook efficiently as disruption happens in the industry. We can add commercial and Medicare Advantage value-based contracts to the MSSP playbook through a CIN or IPA network. Over time, we hope for cross-selling where some providers join the full medical For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Privia Health (PRVA) came out with quarterly earnings of $0.07 per share, missing the Zacks Consensus Estimate of $0.08 per share. This compares to earnings of $0.02 per share a year ago. These figures are adjusted for non-recurring items. This quarterly report represents an earnings surprise of -12.50%. A quarter ago, it was expected that this physician practice management company would post earnings of $0.08 per share when it actually produced earnings of $0.02, delivering a surprise of -75%. Over the last four quarters, the company has surpassed consensus EPS estimates just once. Privia Health, which belongs to the Zacks Medical Info Systems industry, posted revenues of $632.63 million for the quarter ended June 2026, surpassing the Zacks Consensus Estimate by 8.76%. This compares to year-ago revenues of $521.15 million. The company has topped consensus revenue estimates four times over the last four quarters. The sustainability of the stock's immediate price movement based on the recently-released numbers and future earnings expectations will mostly depend on management's commentary on the earnings call. Privia Health shares have added about 1.1% since the beginning of the year versus the S&P 500's gain of 12.8%. While Privia Health has underperformed the market so far this year, the question that comes to investors' minds is: what's next for the stock? There are no easy answers to this key question, but one reliable measure that can help investors address this is the company's earnings outlook. Not only does this include current consensus earnings expectations for the coming quarter(s), but also how these expectations have changed lately. Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions. Investors can track such revisions by themselves or rely on a tried-and-tested rating tool like the Zacks Rank, which has an impressive track record of harnessing the power of earnings estimate revisions. Ahead of this earnings release, the estimate revisions trend for Privia Health was mixed. While the magnitude and direction of estimate revisions could change following the company's just-released earnings report, the current status translates into a Zacks Rank #3 (Hold) for the stock. So, the shares are expected to perform in line with the market in the near future. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. It will be interesting to see how estimates for the coming quarters and the current fiscal year change in the days ahead. The current consensus EPS estimate is $0.08 on $604.98 million in revenues for the coming quarter and $0.27 on $2.4 billion in revenues for the current fiscal year. Investors should be mindful of the fact that the outlook for the industry can have a material impact on the performance of the stock as well. In terms of the Zacks Industry Rank, Medical Info Systems is currently in the top 28% of the 250 plus Zacks industries. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1. One other stock from the same industry, Veeva Systems (VEEV), is yet to report results for the quarter ended July 2026. This provider of cloud-based software services for the life sciences industry is expected to post quarterly earnings of $2.22 per share in its upcoming report, which represents a year-over-year change of +11.6%. The consensus EPS estimate for the quarter has remained unchanged over the last 30 days. Veeva Systems' revenues are expected to be $904.07 million, up 14.6% from the year-ago quarter. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Privia Health Group, Inc. (PRVA) : Free Stock Analysis Report Veeva Systems Inc. (VEEV) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research