Oscar Health Announces Strong Financial Results for First Quarter 2025 And Reaffirms 2025 Guidance
“Oscar reported strong financial results in the first quarter,” said Mark Bertolini, CEO of Oscar Health. “We delivered continued top-line growth and bottom-line performance with significant year-over-year increases in revenue and net income. We continue to expect meaningful margin expansion this year as we deliver superior value to our members and partners.”
Oscar is reaffirming its full year 2025 outlook across all metrics as provided in its financial results press release dated February 4, 2025.
First Quarter 2025 Financial Highlights |
|||
|
Three Months Ended March 31, |
||
(in thousands, except percentages) |
2025 |
|
2024 |
Total revenue |
|
|
|
Medical loss ratio |
|
|
|
SG&A expense ratio |
|
|
|
Earnings from operations |
|
|
|
Net income attributable to Oscar Health, Inc. |
|
|
|
Adjusted EBITDA(1) |
|
|
|
(1) Adjusted EBITDA is a non-GAAP measure. See “Key Operating and Non-GAAP Financial Metrics - Adjusted EBITDA” in this release for a reconciliation to net loss, the most directly comparable GAAP measure, and for information regarding Oscar’s use of Adjusted EBITDA. |
|||
|
As of March 31, |
||
Membership by Offering |
2025 |
|
2024 |
Individual and Small Group |
2,021,484 |
|
1,386,980 |
Cigna+Oscar (1) |
17,983 |
|
61,428 |
Total Members (2) |
2,039,467 |
|
1,448,408 |
(1) Represents total membership for our former co-branded partnership with Cigna. (2) Represents effectuated members. Effectuated members are those who are actively enrolled in one of the Company's plans and whose required premium payments have either been made or are within the payment grace period. |
|||
First Quarter 2025 Key Metrics and Non-GAAP Financial Metrics
-
Total revenue was approximately
$3.0 billion 42% year-over-year. The increase was primarily due to higher membership. -
The medical loss ratio was
75.4% for the first quarter of 2025 compared to74.2% for the first quarter of 2024. The company had$31 million $9 million -
The SG&A expense ratio was
15.8% for the first quarter of 2025 compared to18.4% for the first quarter of 2024. The decrease was primarily driven by fixed cost leverage, lower exchange fee rates, and variable cost efficiencies. -
Earnings from operations was
$297.1 million $185.6 million -
Net income attributable to Oscar Health, Inc. was
$275.3 million $0.92 $177.4 million $0.62 -
Adjusted EBITDA was
$328.8 million $219.3 million
Quarterly Conference Call Details
Oscar will host a conference call to discuss the financial results today, May 7, 2025, at 8:00 a.m. (ET). A live audio webcast will be available via the Investor Relations page of Oscar’s website at ir.hioscar.com. A replay of the webcast will be available for on-demand listening shortly after the completion of the call, at the same web link, and will remain available for approximately 90 days.
Non-GAAP Financial Information
This release presents Adjusted EBITDA, a non-GAAP financial metric, which is provided as a complement to the results provided in accordance with accounting principles generally accepted in
Cautionary Note Regarding Forward-Looking Statements
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. All statements other than statements of historical fact contained herein are forward-looking statements. These statements include, but are not limited to, statements about our financial outlook and estimates, including Total revenue, Medical Loss Ratio, SG&A Expense Ratio, Earnings from Operations, and other financial performance metrics, and the related underlying assumptions,, our business and financial prospects, including potential future growth and margin expansion, and our management’s plans and objectives for future operations, expectations and business strategy. In some cases, you can identify forward-looking statements by terms such as “may,” “will,” “should,” “expects,” “plans,” “anticipates,” “could,” “intends,” “targets,” “projects,” “contemplates,” “believes,” “estimates,” “forecast,” “predicts,” “potential,” or “continues” or the negative of these terms or other similar expressions. Accordingly, we caution you that any such forward-looking statements are not guarantees of future performance and are subject to risks, assumptions, and uncertainties that are difficult to predict and generally beyond our control.
Although we believe that the expectations reflected in these forward-looking statements are reasonable as of the date made, there are or will be important factors that could cause our actual results to differ materially from those indicated in these forward-looking statements, including, but not limited to, the following: our ability to execute our strategy and manage our growth effectively (including our ability to successfully integrate strategic acquisitions); our ability to retain and expand our member base; our ability to accurately estimate our incurred medical expenses or effectively manage our medical costs or related administrative costs; our ability to maintain profitability in the future; unanticipated results of or changes to risk adjustment programs; our ability to arrange for the delivery of quality care and maintain good relations with brokers and the physicians, hospitals, and other providers within and outside our provider networks; changes in federal or state laws or regulations (including any changes in the interpretation or enforcement thereof), including changes with respect to the Patient Protection and Affordable Care Act (“ACA”) and any regulations enacted thereunder, non-renewal of the enhanced APTCs, the implementation of new program integrity rules or other government actions, such as the imposition of tariffs; our ability to comply with ongoing regulatory requirements, including capital reserve and surplus requirements and applicable performance standards; changes or developments in the health insurance markets in
You are cautioned not to place undue reliance on any forward-looking statements made in this press release. Any forward-looking statement speaks only as of the date as of which it is made, and, except as otherwise required by law, we do not undertake any obligation to publicly update or review any forward-looking statement, whether as a result of new information, future developments or otherwise. New factors emerge from time to time, and it is not possible for us to predict which will arise.
About Oscar Health
Oscar Health, Inc. (“Oscar”) is a leading healthcare technology company built around a full stack technology platform and a relentless focus on serving our members. We have been challenging the status quo in the healthcare system since our founding in 2012, and are dedicated to making a healthier life accessible and affordable for all. Oscar offers Individual & Family plans and health technology solutions that power the healthcare industry through +Oscar. Our technology drives superior experiences, deep engagement, and high-value clinical care, earning us the trust of approximately 2.0 million members, as of March 31, 2025.
Oscar Health, Inc. |
|||||
Condensed Consolidated Statements of Operations |
|||||
(unaudited) |
|||||
|
Three Months Ended March 31, |
||||
(in thousands, except per share amounts) |
2025 |
|
2024 |
||
Revenue |
|
|
|
||
Premium |
$ |
2,995,821 |
|
$ |
2,093,682 |
Investment income |
|
46,112 |
|
|
42,989 |
Services and other |
|
4,330 |
|
|
5,634 |
Total revenue |
|
3,046,263 |
|
|
2,142,305 |
Operating Expenses |
|
|
|
||
Medical |
|
2,259,651 |
|
|
1,554,774 |
Selling, general, and administrative |
|
482,759 |
|
|
394,162 |
Depreciation and amortization |
|
6,730 |
|
|
7,811 |
Total operating expenses |
|
2,749,140 |
|
|
1,956,747 |
Earnings from operations |
|
297,123 |
|
|
185,558 |
Interest expense |
|
5,994 |
|
|
5,902 |
Other expenses |
|
2,918 |
|
|
1,178 |
Earnings before income taxes |
|
288,211 |
|
|
178,478 |
Income tax expense |
|
12,705 |
|
|
996 |
Net income |
|
275,506 |
|
|
177,482 |
Less: Net income attributable to noncontrolling interests |
|
235 |
|
|
114 |
Net income attributable to Oscar Health, Inc. |
$ |
275,271 |
|
$ |
177,368 |
|
|
|
|
||
Earnings per Share |
|
|
|
||
Basic |
$ |
1.10 |
|
$ |
0.77 |
Diluted |
$ |
0.92 |
|
$ |
0.62 |
Weighted Average Common Shares Outstanding |
|
|
|
||
Basic |
|
251,279 |
|
|
231,443 |
Diluted |
|
305,938 |
|
|
293,796 |
Oscar Health, Inc. |
|||||||
Condensed Consolidated Balance Sheets |
|||||||
(unaudited) |
|||||||
(in thousands, except per share amounts) |
March 31, 2025 |
|
December 31, 2024 |
||||
Assets |
|
|
|
||||
Current Assets: |
|
|
|
||||
Cash and cash equivalents |
$ |
2,236,555 |
|
|
$ |
1,527,186 |
|
Short-term investments |
|
751,489 |
|
|
|
624,461 |
|
Premiums and accounts receivable (net of allowance for credit losses of |
|
488,766 |
|
|
|
315,891 |
|
Risk adjustment transfer receivable |
|
87,126 |
|
|
|
64,779 |
|
Reinsurance recoverable |
|
187,546 |
|
|
|
291,537 |
|
Other current assets |
|
23,018 |
|
|
|
21,320 |
|
Total current assets |
|
3,774,500 |
|
|
|
2,845,174 |
|
Property, equipment, and capitalized software, net |
|
71,998 |
|
|
|
66,793 |
|
Long-term investments |
|
1,872,677 |
|
|
|
1,815,254 |
|
Restricted deposits |
|
31,010 |
|
|
|
30,878 |
|
Other assets |
|
93,584 |
|
|
|
82,397 |
|
Total assets |
$ |
5,843,769 |
|
|
$ |
4,840,496 |
|
|
|
|
|
||||
Liabilities and Stockholders' Equity |
|
|
|
||||
Current Liabilities: |
|
|
|
||||
Benefits payable |
$ |
1,465,578 |
|
|
$ |
1,356,730 |
|
Risk adjustment transfer payable |
|
1,954,451 |
|
|
|
1,558,341 |
|
Unearned premiums |
|
70,897 |
|
|
|
74,389 |
|
Accounts payable and other liabilities |
|
634,007 |
|
|
|
432,428 |
|
Reinsurance payable |
|
23,643 |
|
|
|
41,346 |
|
Total current liabilities |
|
4,148,576 |
|
|
|
3,463,234 |
|
Long-term debt |
|
299,749 |
|
|
|
299,555 |
|
Other liabilities |
|
59,329 |
|
|
|
61,282 |
|
Total liabilities |
|
4,507,654 |
|
|
|
3,824,071 |
|
Commitments and contingencies (Note 12) |
|
|
|
||||
Stockholders' Equity |
|
|
|
||||
Class A common stock ( |
|
2 |
|
|
|
2 |
|
Class B common stock ( |
|
— |
|
|
|
— |
|
Treasury stock (315 thousand shares as of March 31, 2025 and December 31, 2024) |
|
(2,923 |
) |
|
|
(2,923 |
) |
Additional paid-in capital |
|
3,902,373 |
|
|
|
3,869,617 |
|
Accumulated deficit |
|
(2,576,012 |
) |
|
|
(2,851,283 |
) |
Accumulated other comprehensive income (loss) |
|
9,601 |
|
|
|
(1,827 |
) |
Total Oscar Health, Inc. stockholders' equity |
|
1,333,041 |
|
|
|
1,013,586 |
|
Noncontrolling interests |
|
3,074 |
|
|
|
2,839 |
|
Total stockholders' equity |
|
1,336,115 |
|
|
|
1,016,425 |
|
Total liabilities and stockholders' equity |
$ |
5,843,769 |
|
|
$ |
4,840,496 |
|
Oscar Health, Inc. |
|||||||
Condensed Consolidated Statements of Cash Flows |
|||||||
(unaudited) |
|||||||
|
Three Months Ended March 31, |
||||||
(in thousands) |
2025 |
|
2024 |
||||
Cash Flows from Operating Activities: |
|
|
|
||||
Net income |
$ |
275,506 |
|
|
$ |
177,482 |
|
Adjustments to reconcile net income to net cash provided by (used in) operating activities: |
|
|
|
||||
Deferred taxes |
|
36 |
|
|
|
(79 |
) |
Net realized gain on sale of financial instruments |
|
(119 |
) |
|
|
— |
|
Depreciation and amortization expense |
|
6,730 |
|
|
|
7,811 |
|
Amortization of debt issuance costs |
|
194 |
|
|
|
194 |
|
Stock-based compensation expense |
|
24,975 |
|
|
|
25,945 |
|
Net accretion of investments |
|
(7,673 |
) |
|
|
(6,226 |
) |
Change in provision for credit losses |
|
(8,650 |
) |
|
|
(1,000 |
) |
Changes in assets and liabilities: |
|
|
|
||||
(Increase) / decrease in: |
|
|
|
||||
Premium and other receivables |
|
(164,225 |
) |
|
|
(140,635 |
) |
Risk adjustment transfer receivable |
|
(22,347 |
) |
|
|
(10,112 |
) |
Reinsurance recoverable |
|
103,990 |
|
|
|
(1,741 |
) |
Other assets |
|
(13,265 |
) |
|
|
(6,285 |
) |
Increase / (decrease) in: |
|
|
|
||||
Benefits payable |
|
108,848 |
|
|
|
282,361 |
|
Unearned premiums |
|
(3,492 |
) |
|
|
(376 |
) |
Premium deficiency reserve |
|
— |
|
|
|
(1,444 |
) |
Accounts payable and other liabilities |
|
199,627 |
|
|
|
28,473 |
|
Reinsurance payable |
|
(17,703 |
) |
|
|
914 |
|
Risk adjustment transfer payable |
|
396,110 |
|
|
|
279,081 |
|
Net cash provided by operating activities |
|
878,542 |
|
|
|
634,363 |
|
Cash Flows from Investing Activities: |
|
|
|
||||
Purchase of investments |
|
(336,869 |
) |
|
|
(556,693 |
) |
Sale of investments |
|
15,761 |
|
|
|
— |
|
Maturity and paydowns of investments |
|
155,906 |
|
|
|
261,428 |
|
Purchase of property, equipment and capitalized software |
|
(9,026 |
) |
|
|
(5,950 |
) |
Change in restricted deposits |
|
— |
|
|
|
626 |
|
Net cash used in investing activities |
|
(174,228 |
) |
|
|
(300,589 |
) |
Cash Flows from Financing Activities: |
|
|
|
||||
Tax payments related to net settlement of share-based awards |
|
(855 |
) |
|
|
— |
|
Proceeds from exercise of stock options |
|
5,728 |
|
|
|
27,309 |
|
Net cash provided by financing activities |
|
4,873 |
|
|
|
27,309 |
|
Increase in cash, cash equivalents and restricted cash equivalents |
|
709,187 |
|
|
|
361,083 |
|
Cash, cash equivalents, restricted cash and cash equivalents—beginning of period |
|
1,551,118 |
|
|
|
1,891,971 |
|
Cash, cash equivalents, restricted cash and cash equivalents—end of period |
|
2,260,305 |
|
|
|
2,253,054 |
|
Cash and cash equivalents |
|
2,236,555 |
|
|
|
2,230,799 |
|
Restricted cash and cash equivalents included in restricted deposits |
|
23,750 |
|
|
|
22,255 |
|
Total cash, cash equivalents and restricted cash and cash equivalents |
$ |
2,260,305 |
|
|
$ |
2,253,054 |
|
Supplemental Disclosures: |
|
|
|
||||
Interest payments |
$ |
154 |
|
|
$ |
11,118 |
|
Key Operating and Non-GAAP Financial Metrics
We regularly review the following key operating and Non-GAAP financial metrics, to evaluate our business, measure our performance, identify trends in our business, prepare financial projections, and make strategic decisions. We believe these operational and financial measures are useful in evaluating our performance, in addition to our financial results prepared in accordance with GAAP.
Total Revenue
Total revenue includes Premium revenue, Investment income, and Services and other revenue. We believe Total revenue is an important metric to assess the growth of our business, as well as the earnings potential of our investment portfolio.
Medical Loss Ratio
Medical Loss Ratio is a metric used to calculate medical expenses as a percentage of net premiums before ceded quota share reinsurance. Medical expense primarily consists of both paid and unpaid medical expenses incurred to provide medical services and products to our members. Medical claims include fee-for-service claims, pharmacy benefits, capitation payments to providers, provider disputed claims and various other medical-related costs. The impact of the federal risk adjustment program is included in the denominator of our MLR. We believe MLR is an important metric to demonstrate the ratio of our costs to pay for healthcare of our members to the net premium before ceded quota share reinsurance. MLR in our existing products are subject to various federal and state minimum requirements.
|
Three Months Ended March 31, |
||||||
(in thousands, except percentages) |
2025 |
|
2024 |
||||
Medical |
$ |
2,259,651 |
|
|
$ |
1,554,774 |
|
Less: Ceded quota share reinsurance claims (1) |
|
— |
|
|
|
(1,055 |
) |
Net claims before ceded quota share reinsurance (A) |
$ |
2,259,651 |
|
|
$ |
1,555,829 |
|
|
|
|
|
||||
Premiums |
$ |
2,995,821 |
|
|
$ |
2,093,682 |
|
Less: Ceded quota share reinsurance premiums (1) |
|
— |
|
|
|
(2,016 |
) |
Net premiums before ceded quota share reinsurance (B) |
$ |
2,995,821 |
|
|
$ |
2,095,698 |
|
Medical Loss Ratio (A divided by B) |
|
75.4 |
% |
|
|
74.2 |
% |
(1) Represents prior period development for claims and premiums, respectively, ceded to reinsurers pursuant to quota share treaties accounted for under reinsurance accounting, which are in runoff |
|||||||
SG&A Expense Ratio
The SG&A Expense Ratio reflects the Company’s selling, general and administrative ("SG&A") expenses, as a percentage of Total revenue. Selling, general and administrative expenses primarily include distribution and servicing costs, premium taxes, exchange fees, and other taxes and fees, employee-related expenses, costs of software and hardware, stock-based compensation, the impact of quota share reinsurance, and other administrative costs. We believe the SG&A Expense ratio is a valuable metric to evaluate our ability to manage our overall selling, general, and administrative cost base.
Earnings from Operations
Earnings from Operations is a new primary metric for assessing operating performance. Earnings from Operations is the Company's Total revenue less Total operating expenses.
Net Income attributable to Oscar Health, Inc.
Net Income attributable to Oscar Health, Inc. is Net earnings allocated to the Company after income attributable to noncontrolling interests. It is a key indicator of the Company’s profitability and operational efficiency, allowing management to evaluate performance and make informed decisions on strategic planning, cost management, and resource allocation.
Adjusted EBITDA
Adjusted EBITDA is defined as Net income (loss) for the Company and its consolidated subsidiaries before interest expense, income tax expense (benefit), and depreciation and amortization, as further adjusted for stock-based compensation and other items that are considered unusual or not representative of underlying trends of our business, where applicable for the period presented. We present Adjusted EBITDA because we believe it is frequently used by securities analysts, investors, and other interested parties in the evaluation of companies in our industry. Adjusted EBITDA is a non-GAAP measure. Management believes that investors’ understanding of our performance is enhanced by including this non-GAAP financial measure as a reasonable basis for comparing our ongoing results of operations. We caution investors that amounts presented in accordance with our definition of Adjusted EBITDA may not be comparable to similar measures disclosed by our competitors, because not all companies and analysts calculate Adjusted EBITDA in the same manner.
By providing this non-GAAP financial measure, together with a reconciliation to the most comparable
|
Three Months Ended March 31, |
||||
(in thousands) |
2025 |
|
2024 |
||
Net income |
$ |
275,506 |
|
$ |
177,482 |
Interest expense |
|
5,994 |
|
|
5,902 |
Other expenses |
|
2,918 |
|
|
1,178 |
Income tax expense |
|
12,705 |
|
|
996 |
Earnings from operations |
|
297,123 |
|
|
185,558 |
Depreciation and amortization |
|
6,730 |
|
|
7,811 |
Stock-based compensation(1) |
|
24,975 |
|
|
25,945 |
Adjusted EBITDA |
$ |
328,828 |
|
$ |
219,314 |
(1) Represents non-cash expenses related to equity-based compensation programs, which vary from period to period depending on various factors including the timing, number, and the valuation of awards. Additionally, these expenses are reported net of any stock-based compensation that has been capitalized for software development costs. |
|||||
Appendix
Reinsurance Impact |
|||||||
|
Three Months Ended March 31, |
||||||
(in thousands) |
2025 |
|
2024 |
||||
Quota share ceded premiums |
$ |
— |
|
|
$ |
(4,994 |
) |
Quota share ceded claims |
|
— |
|
|
|
1,055 |
|
Deposit Accounting impact, net of ceding commission |
|
(11,321 |
) |
|
|
(12,172 |
) |
Experience refund |
|
— |
|
|
|
2,979 |
|
Net quota share impact |
$ |
(11,321 |
) |
|
$ |
(13,132 |
) |
The Company records Premium revenue net of reinsurance. The following table reconciles total reinsurance premiums ceded and reinsurance premiums assumed, which are included as components of total Premium revenue in the Condensed Consolidated Statements of Operations:
|
Three Months Ended March 31, |
||||||
(in thousands) |
2025 |
|
2024 |
||||
Direct policy premiums |
$ |
3,349,671 |
|
|
$ |
2,310,100 |
|
Assumed premiums |
|
22,441 |
|
|
|
57,612 |
|
Risk adjustment transfers |
|
(373,749 |
) |
|
|
(269,398 |
) |
Reinsurance premiums ceded |
|
(2,542 |
) |
|
|
(4,632 |
) |
Premium |
$ |
2,995,821 |
|
|
$ |
2,093,682 |
|
The Company records Medical expenses net of reinsurance recoveries. The following table reconciles total Medical expenses to the amount presented in the Condensed Consolidated Statements of Operations:
|
Three Months Ended March 31, |
||||||
(in thousands) |
2025 |
|
2024 |
||||
Direct claims incurred |
$ |
2,268,284 |
|
|
$ |
1,523,646 |
|
Ceded reinsurance claims |
|
(31,012 |
) |
|
|
(19,698 |
) |
Assumed reinsurance claims |
|
22,379 |
|
|
|
50,826 |
|
Medical expenses |
$ |
2,259,651 |
|
|
$ |
1,554,774 |
|
The Company records Selling, general and administrative ("SG&A") expenses net of reinsurance ceding commissions and assumed SG&A expenses. The following table reconciles total Selling, general and administrative expenses to the amount presented in the Condensed Consolidated Statements of Operations:
|
Three Months Ended March 31, |
|||||
(in thousands) |
2025 |
|
2024 |
|||
Selling, general and administrative expenses, gross |
$ |
482,759 |
|
$ |
394,696 |
|
Reinsurance ceding commissions |
|
— |
|
|
(534 |
) |
Selling, general and administrative expenses |
$ |
482,759 |
|
$ |
394,162 |
|
The Company classifies Reinsurance recoverable within current assets on its Condensed Consolidated Balance Sheets. The composition of the Reinsurance recoverable balance is as follows:
(in thousands) |
March 31, 2025 |
|
December 31, 2024 |
||||
Reinsurance premium and claim recoverables |
$ |
185,787 |
|
|
$ |
288,878 |
|
Reinsurance ceding commissions |
|
7,002 |
|
|
|
6,996 |
|
Experience refunds on reinsurance agreements |
|
(5,243 |
) |
|
|
(4,338 |
) |
Reinsurance recoverable |
$ |
187,546 |
|
|
$ |
291,537 |
|
View source version on businesswire.com: https://www.businesswire.com/news/home/20250507627681/en/
Investor:
Chris Potochar
VP of Investor Relations
ir@hioscar.com
Media:
Kristen Prestano
VP of Communications
press@hioscar.com
Source: Oscar Health, Inc.
