P3 Health Partners (NASDAQ: PIII) swings to Q2 profit and lifts 2026 EBITDA guidance
Rhea-AI Filing Summary
P3 Health Partners reported stronger results for the quarter ended June 30, 2026. Total revenue was $386.4 million, up 9% from the prior-year quarter, driven by 15% growth in per-member capitated revenue. At-risk membership was approximately 105,000, down 10% as the company pursued intentional network and payer rationalization, with 133,000 total lives under management including 28,000 in service arrangements.
Medical margin was $97.8 million, or $311 PMPM; excluding favorable payer settlements and prior-year development, medical margin was $52.9 million, or $168 PMPM. The company generated net income of $15.7 million, compared with a net loss of $43.7 million a year earlier. Adjusted EBITDA was $54.4 million, or $173 PMPM, versus a loss of $17.1 million, or negative $49 PMPM, in the prior-year quarter.
For full-year 2026, P3 now guides to total revenue of $1.5–$1.6 billion, medical margin of $260–$300 million (PMPM $210–$240), and Adjusted EBITDA of $80–$110 million, based on first-half performance and the impact of payer settlements and prior-year development.
Positive
- Returned to profitability with $15.7 million net income versus a $43.7 million net loss in the prior-year quarter.
- Delivered strong non-GAAP performance with $54.4 million Adjusted EBITDA versus a $17.1 million loss a year ago.
- Expanded medical margin to $97.8 million from $30.6 million, reflecting improved medical cost performance and contract structure.
- Raised full-year 2026 Adjusted EBITDA guidance to a range of $80–$110 million, signaling confidence in operating trends.
Negative
- Operating cash flow remained pressured, with net cash used in operating activities of $89.4 million in the first half of 2026.
- At-risk membership declined 10% to approximately 105,000 members, reducing scale despite being tied to network and payer rationalization.
8-K Event Classification
2 items: 2.02, 9.01
2 items
Item 2.02
Results of Operations and Financial Condition
Financial
Disclosure of earnings results, typically an earnings press release or preliminary financials.
Item 9.01
Financial Statements and Exhibits
Exhibits
Financial statements, pro forma financial information, and exhibit attachments filed with this report.
Key Figures
Q2 2026 Total Revenue: $386.4 million
Q2 2026 Net Income: $15.7 million
Q2 2026 Adjusted EBITDA: $54.4 million
+5 more
8 metrics
Q2 2026 Total Revenue
$386.4 million
Three months ended June 30, 2026 total operating revenue
Q2 2026 Net Income
$15.7 million
Net income for the three months ended June 30, 2026
Q2 2026 Adjusted EBITDA
$54.4 million
Adjusted EBITDA for the three months ended June 30, 2026
Q2 2026 Medical Margin
$97.8 million
Medical margin for the three months ended June 30, 2026
At-Risk Membership
105,000 members
Approximate at-risk members in Q2 2026, 10% below prior year
Operating Cash Flow H1 2026
$89.4 million used
Net cash used in operating activities for six months ended June 30, 2026
2026 Revenue Guidance
$1,500–$1,600 million
Total revenue outlook for year ending December 31, 2026
2026 Adjusted EBITDA Guidance
$80–$110 million
Adjusted EBITDA outlook for year ending December 31, 2026
Key Terms
capitated revenue, medical margin, premium deficiency reserve, Adjusted EBITDA, +2 more
6 terms
capitated revenue financial
"Capitated revenue was $366,398 for the three months ended June 30, 2026"
Capitated revenue is the fixed amount a healthcare provider or insurer receives for each enrolled patient over a set period, like a monthly subscription fee paid regardless of how much care the patient uses. It matters to investors because it creates predictable cash flow and rewards efficient care, but also transfers financial risk to the provider if patient costs exceed the fixed payments, affecting profitability and future valuation.
medical margin financial
"Medical margin for the quarter was $97.8 million, or $311 on a per-member-per-month basis"
Adjusted EBITDA financial
"Adjusted EBITDA for the quarter was $54.4 million, or $173 PMPM"
Adjusted EBITDA is a way companies measure how much money they make from their core operations, like running a business, by removing certain costs or income that aren’t part of regular business activities. It helps investors see how well a company is doing without distractions from unusual expenses or gains, making it easier to compare companies or track performance over time.
non-GAAP financial measures financial
"this press release contains certain non-GAAP financial measures as defined by the SEC rules"
Non-GAAP financial measures are numbers companies use to show their financial performance that exclude certain expenses or income. They help investors see how the company might perform without one-time costs or other unusual items, giving a different perspective from official reports. However, since they can be adjusted, they don’t always tell the full story and should be looked at alongside standard financial figures.
at-risk members financial
"At-risk membership was approximately 105,000 members for the second quarter"
At-risk members are customers or plan participants who are likely to generate unusually high costs or to stop using a service—for example, patients with complex health needs who may require expensive care or subscribers showing clear signs they will cancel. Investors pay attention because a concentration of these members can materially change future revenue and expenses: they can drive bigger claims or require extra spending on care and retention, creating concentrated financial risk similar to a few leaky pipes threatening an entire budget.
Earnings Snapshot
Total Revenue Q2 2026: $386.4 million · Guidance included
Three and six months ended June 30, 2026
Total Revenue Q2 2026
$386.4 million
Increased from $355.8 million in Q2 2025
Net Income Q2 2026
$15.7 million
Improved from net loss of $43.7 million in Q2 2025
Adjusted EBITDA Q2 2026
$54.4 million
Improved from Adjusted EBITDA loss of $17.1 million in Q2 2025
Medical Margin Q2 2026
$97.8 million
Increased from $30.6 million in Q2 2025
Guidance
For 2026, the company expects total revenue of $1.5–$1.6 billion, medical margin of $260–$300 million, medical margin PMPM of $210–$240, and Adjusted EBITDA of $80–$110 million.
AI-generated analysis. How Rhea-AI works. Not financial advice.
FAQ
How did P3 Health Partners (PIII) perform financially in Q2 2026?
P3 reported $386.4 million in total revenue and $15.7 million in net income for Q2 2026, compared with $355.8 million revenue and a $43.7 million net loss in the prior-year quarter.
What were P3 Health Partners (PIII) Adjusted EBITDA results for Q2 2026?
Adjusted EBITDA was $54.4 million, or $173 PMPM, in Q2 2026. This compares to an Adjusted EBITDA loss of $17.1 million, or negative $49 PMPM, in the same quarter of 2025.
What 2026 guidance did P3 Health Partners (PIII) provide?
For 2026, P3 guides to $1.5–$1.6 billion in total revenue, $260–$300 million in medical margin, medical margin PMPM of $210–$240, and $80–$110 million in Adjusted EBITDA.
How did membership trends look for P3 Health Partners (PIII) in Q2 2026?
At-risk membership was about 105,000 members, a 10% decrease year over year, reflecting intentional network and payer rationalization. Total lives under management were approximately 133,000, including around 28,000 under service arrangements.
What was P3 Health Partners (PIII) medical margin in Q2 2026?
Medical margin reached $97.8 million, or $311 PMPM, in Q2 2026. Excluding favorable payer settlements and prior-year development, medical margin was $52.9 million, or $168 PMPM.
What does P3 Health Partners (PIII) report about cash flow in 2026 so far?
For the first six months of 2026, P3 reported net cash used in operating activities of $89.4 million. Net cash used in investing was $0.3 million, and financing activities provided $86.0 million, driven by preferred stock, debt, and warrant issuances.
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): August 10, 2026
(Exact name of registrant as specified in its charter)
| (State or other jurisdiction of incorporation) | (Commission File Number) | (I.R.S. Employer Identification No.) | ||||||
| (Address of principal executive offices) | (Zip Code) | ||||
(702 ) 910-3950
(Registrant’s telephone number, including area code)
Not Applicable
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
| Written communications pursuant to Rule 425 under the Securities Act | |||||
| Soliciting material pursuant to Rule 14a-12 under the Exchange Act | |||||
| Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act | |||||
| Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act | |||||
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||||||||||||
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ¨
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨
Item 2.02 Results of Operations and Financial Condition.
On August 10, 2026, P3 Health Partners Inc. (the “Company”) announced its financial results for the three and six months ended June 30, 2026. The full text of the press release issued in connection with the announcement is furnished as Exhibit 99.1 to this Current Report on Form 8-K (the “Report”).
The information in this Item 2.02, including the information contained in Exhibit 99.1 of this Report, shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 (the “Exchange Act”), or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Exchange Act or the Securities Act of 1933, as amended, except as expressly set forth by specific reference in such a filing.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits
| Exhibit Number | Description | |||||||
99.1 | Press Release of the Company, dated August 10, 2026 | |||||||
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document). | |||||||
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| P3 Health Partners Inc. | |||||||||||
| Date: | August 10, 2026 | By: | /s/ Leif Pedersen | ||||||||
| Leif Pedersen | |||||||||||
| Chief Financial Officer | |||||||||||
Exhibit 99.1
P3 Health Partners Announces Second Quarter 2026 Results
Raises Full-Year 2026 Adjusted EBITDA Guidance
Management to Host Conference Call and Webcast August 10, 2026 at 4:30 PM ET
HENDERSON, NV—August 10, 2026—P3 Health Partners Inc. (“P3” or the “Company”) (NASDAQ: PIII), a patient-centered and physician-led population health management company, today announced its financial results for the second quarter ended June 30, 2026.
"Q2 demonstrates that the business is now executing according to our plan. We delivered $54 million of adjusted EBITDA, with the core business driving improved profitability quarter over quarter. Our results reflect the structural improvements now embedded across our contracts, our network, and our operating model, the work I outlined at the onset of my tenure. That strength gives us the confidence to raise our full-year 2026 adjusted EBITDA outlook and to enter the second half focused on execution." said Dr. Aric Coffman, CEO of P3.
Second Quarter 2026 Financial Results
•At-risk membership was approximately 105,000 members for the second quarter, a decrease of 10% compared to prior year, reflecting previously disclosed intentional network and payer rationalization. Total lives under management were approximately 133,000 for the quarter, including the approximately 28,000 lives under management service arrangements.
•Total revenue was $386 million, an increase of 9% compared with the prior year quarter. Total per-member capitated revenue increased 15% from the same period in the prior year driven by improved network economics, rate progression, and burden of illness performance.
•Medical margin(1) for the quarter was $97.8 million, or $311 on a per-member-per-month basis. The results include the favorable impact of payer settlements and prior year development recognized in the quarter. Excluding these items, medical margin for the quarter was $52.9 million, or $168 on a per-member-per-month basis.
•Net income was $15.7 million compared to a net loss of $43.7 million in the prior year quarter.
•Adjusted EBITDA(1) for the quarter was $54.4 million, or $173 PMPM, compared to a loss of $17.1 million, or negative $49 per-member-per-month in the prior year quarter.
Revised Fiscal 2026 Guidance
•Full-year revised guidance reflects the impact of underlying first half performance, as well as the prior-year development and payer settlements recognized in the quarter.
| Year Ending December 31, 2026 | |||||||||||
| Low | High | ||||||||||
At-risk Members(2) | 102,000 | 106,000 | |||||||||
| Total Revenues (in millions) | $1,500 | $1,600 | |||||||||
Medical Margin(1)(3) (in millions) | $260 | $300 | |||||||||
Medical Margin(1)(3) PMPM | $210 | $240 | |||||||||
Adjusted EBITDA(1)(3) (in millions) | $80 | $110 | |||||||||
(1)Adjusted EBITDA, Adjusted EBITDA per member, per month (“PMPM”), medical margin, and medical margin PMPM are non-GAAP financial measures. For reconciliations of these measures to the most directly comparable GAAP measures, if applicable, and more information regarding the Company’s use of non-GAAP financial measures, please see the section titled “Non-GAAP Financial Measures.”
(2)See “Key Performance Metrics” for additional information on how the Company defines “at-risk members.”
(3) The Company is not able to provide a quantitative reconciliation of guidance for Adjusted EBITDA, medical margin and medical margin PMPM to net income (loss), gross profit and gross profit PMPM, the most directly comparable GAAP measures, respectively, and has not provided forward-looking guidance for net income (loss), because of the uncertainty around certain items that may impact net income (loss), gross profit (loss) or gross profit (loss) PMPM that are not within our control or cannot be reasonably predicted without unreasonable effort. For more information regarding the non-GAAP financial measures discussed in this press release, please see “Non-GAAP Financial Measures” below.
The foregoing 2026 outlook statement represents management's current estimate as of the date of this release. Actual results may differ materially depending on a number of factors. Investors are urged to read the “Cautionary Note Regarding Forward-Looking Statements” included in this release. Management does not assume any obligation to update these estimates.
Management to Host Conference Call and Webcast on August 10, 2026 at 4:30 PM ET
| Title & Webcast | P3 Health Second Quarter 2026 Earnings Conference Call | ||||
| Date & Time | August 10, 2026, 4:30 PM Eastern Time | ||||
| Conference Call Details | Toll-Free 1-833-316-0546 (US) International 1-412-317-0692 Ask to be joined into the P3 Health Partners call | ||||
The conference call will also be webcast live in the “Events & Presentations” section of the Investor page of the P3 website (ir.p3hp.org). The Company’s press release will be available on the Investor page of P3’s website in advance of the conference call. An archived recording of the webcast will be available on the Investor page of P3’s website for a period of 90 days following the conference call. | |||||
About P3 Health Partners (NASDAQ: PIII):
P3 Health Partners Inc. is a leading population health management company committed to transforming healthcare by improving the lives of both patients and providers. Founded and led by physicians, P3 has an expansive network of more than 2,100 affiliated primary care providers across the country. Our local teams of health care professionals manage the care of thousands of patients in 26 counties across five states. P3 supports primary care providers with value-based care coordination and administrative services that improve patient outcomes and lower costs. Through partnerships with these local providers, the P3 care team creates an enhanced patient experience by navigating, coordinating, and integrating the patient’s care within the healthcare system. For more information, visit www.p3hp.org and follow us on LinkedIn and Facebook.com/p3healthpartners.
Non-GAAP Financial Measures
In addition to the financial results prepared in accordance with accounting principles generally accepted in the U.S. (“GAAP”), this press release contains certain non-GAAP financial measures as defined by the SEC rules, including Adjusted EBITDA and Adjusted EBITDA PMPM, medical margin, medical margin PMPM, and adjusted operating expense. EBITDA is defined as GAAP net income (loss) before (i) interest, (ii) income taxes and (iii) depreciation and amortization. Adjusted EBITDA is defined as EBITDA, further adjusted to exclude the effect of certain supplemental adjustments, such as (i) mark-to-market warrant gain/loss, (ii) premium deficiency reserves, (iii) equity-based compensation expense, (iv) certain transaction and other related costs and (v) certain other items that we believe are not indicative of our core operating performances. Adjusted EBITDA PMPM is defined as Adjusted EBITDA divided by the number of at-risk Medicare members each month divided by the number of months in the period. We believe these non‐GAAP financial measures provide an additional tool for investors to use in evaluating ongoing operating results and trends and in comparing our financial measures with other similar companies. Medical margin represents the amount earned from capitation revenue after medical claims expenses are deducted and medical margin PMPM is defined as medical margin divided by the number of Medicare members each month divided by the number of months in the period. Medical claims expenses represent costs incurred for medical services provided to our members. As our platform grows and matures over time, we expect medical margin to increase in absolute dollars; however, medical margin PMPM may vary as the percentage of new members brought onto our platform fluctuates. New membership added to the platform is typically dilutive to medical margin PMPM. Adjusted operating expense is defined as total operating expense excluding depreciation and amortization and costs that management believes are non-core to the underlying operations of the Company, consisting of (i) medical expense, (ii) premium deficiency reserves, (iii) equity-based compensation, and (iv) certain other items that we believe are not indicative of our core operating performance. We do not consider these non‐GAAP measures in isolation or as an alternative to financial measures determined in accordance with GAAP. These non-GAAP financial measures are subject to inherent limitations as they reflect the exercise of judgments by management about which expense and income are excluded or included in determining these non‐GAAP financial measures. In addition, other companies may calculate non-GAAP financial measures differently or may use other measures to evaluate their performance, all of which could reduce the usefulness of our non-GAAP financial measures as tools for comparison. The tables at the end of this press release present a reconciliation of Adjusted EBITDA, medical margin to gross profit, medical margin PMPM to gross profit PMPM, and adjusted operating expense to operating expense, which are the most directly comparable financial measures calculated in accordance with GAAP.
Key Performance Metrics
In addition to our GAAP and non-GAAP financial information, the Company also monitors “at-risk members” to help us evaluate our business, identify trends affecting our business, formulate business plans and make strategic decisions. At-risk membership represents the approximate number of Medicare members for whom we receive a fixed percentage of premium under capitation arrangements as of the end of a particular period.
Cautionary Note Regarding Forward-Looking Statements
This press release contains forward-looking statements within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. We intend such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Words such as "anticipate," "believe," "budget," "contemplate," "continue," "could," "envision," "estimate," "expect," "guidance," "indicate," "intend," "may," "might," "plan," "possibly," "potential," "predict," "probably," "pro-forma," "project," "seek," "should," "target," or "will," or the negative or other variations thereof, and similar words or phrases or comparable terminology, are intended to identify forward-looking statements. These forward-looking statements address various matters, including the Company’s future expected growth strategy and operating performance; and the Company’s ability to execute on its identified strategic improvement opportunities, all of which reflect the Company’s expectations based upon currently available information and data. Because such statements are based on expectations as to future financial and operating results and are not statements of fact, actual results may differ materially from those projected or estimated and you are cautioned not to place undue reliance on these forward-looking statements. These forward-looking statements are not guarantees of future performance, conditions or results, and involve a number of known and unknown risks, uncertainties, assumptions and other important factors, many of which are outside the Company's control, that could cause actual results or outcomes to differ materially from those discussed in the forward-looking statements.
Important risks and uncertainties that could cause our actual results and financial condition to differ materially from those indicated in forward-looking statements include, among others, our ability to continue as a going concern; our potential need to raise additional capital to fund our existing operations or develop and commercialize new services or expand our operations; our ability to achieve or maintain profitability; our ability to maintain compliance with our debt covenants in the future, or obtain required waivers from our lenders if future operating performance were to fall below current projections, and if there are material changes to management’s assumptions, we could be required to recognize non-cash charges to operating earnings for goodwill and/or other intangible asset impairment; our ability to identify and develop successful new geographies, physician partners, payors and patients; changes in market or industry conditions, regulatory environment, competitive conditions, and receptivity to our services; our ability to fund our growth and expand our operations; changes in laws and regulations applicable to our business; our ability to maintain our relationships with health plans and other key payors; the impact of fluctuations in risk adjustments; our ability to establish and maintain effective internal controls; our ability to maintain compliance with California regulations related to financial solvency and operational performance; our ability to maintain the listing of our securities on Nasdaq; increased labor costs and medical expense; our ability to recruit and retain qualified team members and independent physicians; and the factors described under Part I, Item 1A. “Risk Factors” and Part II, Item 7. “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K for the year ended December 31, 2025, filed with the SEC on March 26, 2026, and in our subsequent filings with the SEC.
All information in this press release is as of the date hereof, and we undertake no duty to update or revise this information unless required by law. You are cautioned not to place undue reliance on any forward-looking statements contained in this press release.
David Deuchler
Investor Relations
Gilmartin Group
investors@p3hp.org
P3 HEALTH PARTNERS INC. and SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands, except per share amounts)
(unaudited)
| June 30, 2026 | December 31, 2025 | ||||||||||
| ASSETS | |||||||||||
| CURRENT ASSETS: | |||||||||||
| Cash | $ | 21,272 | $ | 25,012 | |||||||
| Restricted cash | 922 | 795 | |||||||||
Health plan receivable, net of allowance for credit losses of $281 | 135,273 | 92,458 | |||||||||
| Clinic fees, insurance and other receivable | 9,354 | 3,379 | |||||||||
| Prepaid expenses and other current assets | 12,517 | 11,439 | |||||||||
| TOTAL CURRENT ASSETS | 179,338 | 133,083 | |||||||||
| Property and equipment, net | 2,527 | 3,374 | |||||||||
| Intangible assets, net | 452,405 | 492,423 | |||||||||
| Other long-term assets | 20,122 | 27,761 | |||||||||
| TOTAL ASSETS | $ | 654,392 | $ | 656,641 | |||||||
LIABILITIES, MEZZANINE EQUITY, AND STOCKHOLDERS’ (DEFICIT) EQUITY | |||||||||||
| CURRENT LIABILITIES: | |||||||||||
| Accounts payable | $ | 7,569 | $ | 11,715 | |||||||
| Accrued expenses and other current liabilities | 43,265 | 42,820 | |||||||||
| Accrued payroll | 2,421 | 1,950 | |||||||||
| Health plan settlements payable | 11,386 | 69,830 | |||||||||
| Claims payable | 228,980 | 287,790 | |||||||||
| Premium deficiency reserve | 72,742 | 86,116 | |||||||||
| Current portion of long-term debt | 21,800 | 45,036 | |||||||||
| Short-term debt | 418 | — | |||||||||
| TOTAL CURRENT LIABILITIES | 388,581 | 545,257 | |||||||||
Operating lease liability, net | 10,417 | 11,475 | |||||||||
| Warrant liabilities | 10,389 | 2,462 | |||||||||
| Long-term debt, net | 98,054 | 228,374 | |||||||||
Other long-term liabilities | 9,308 | 9,308 | |||||||||
| TOTAL LIABILITIES | 516,749 | 796,876 | |||||||||
COMMITMENTS AND CONTINGENCIES | |||||||||||
| MEZZANINE EQUITY: | |||||||||||
| Redeemable non-controlling interest | 64,453 | 14,997 | |||||||||
| STOCKHOLDERS’ EQUITY (DEFICIT): | |||||||||||
| Series A 13.5% Cumulative Preferred Stock | 21,186 | — | |||||||||
| Series B 17.5% Cumulative Preferred Stock | 18,717 | — | |||||||||
| Series C 19.5% Cumulative Preferred Stock | 81,317 | — | |||||||||
| Series D 19.5% Cumulative Preferred Stock | 43,218 | — | |||||||||
| Class A common stock | — | — | |||||||||
| Class V common stock | — | — | |||||||||
| Additional paid in capital | 550,226 | 495,909 | |||||||||
| Accumulated deficit | (642,474) | (651,141) | |||||||||
Non-controlling interest | 1,000 | — | |||||||||
| TOTAL STOCKHOLDERS’ EQUITY (DEFICIT) | 73,190 | (155,232) | |||||||||
| TOTAL LIABILITIES, MEZZANINE EQUITY, AND STOCKHOLDERS’ EQUITY (DEFICIT) | $ | 654,392 | $ | 656,641 | |||||||
P3 HEALTH PARTNERS INC. and SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share amounts)
(unaudited)
| Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||
| OPERATING REVENUE: | |||||||||||||||||||||||
| Capitated revenue | $ | 366,398 | $ | 351,724 | $ | 745,897 | $ | 721,241 | |||||||||||||||
Other revenue | 19,983 | 4,064 | 26,874 | 7,772 | |||||||||||||||||||
| TOTAL OPERATING REVENUE | 386,381 | 355,788 | 772,771 | 729,013 | |||||||||||||||||||
| OPERATING EXPENSE: | |||||||||||||||||||||||
| Medical expense | 300,377 | 351,350 | 636,401 | 723,393 | |||||||||||||||||||
| Premium deficiency reserve | (8,659) | (5,967) | (13,374) | (12,929) | |||||||||||||||||||
| Corporate, general and administrative expense | 32,393 | 23,446 | 58,163 | 48,626 | |||||||||||||||||||
| Depreciation and amortization | 21,044 | 21,083 | 42,118 | 42,135 | |||||||||||||||||||
| TOTAL OPERATING EXPENSE | 345,155 | 389,912 | 723,308 | 801,225 | |||||||||||||||||||
OPERATING INCOME (LOSS) | 41,226 | (34,124) | 49,463 | (72,212) | |||||||||||||||||||
| OTHER INCOME (EXPENSE): | |||||||||||||||||||||||
| Interest expense, net | (7,862) | (10,145) | (24,628) | (18,870) | |||||||||||||||||||
| Mark-to-market of stock warrants and purchased put option | (16,366) | 2,002 | (16,036) | 5,324 | |||||||||||||||||||
| Other | (82) | 583 | 160 | 901 | |||||||||||||||||||
TOTAL OTHER EXPENSE | (24,310) | (7,560) | (40,504) | (12,645) | |||||||||||||||||||
| INCOME (LOSS) BEFORE INCOME TAXES | 16,916 | (41,684) | 8,959 | (84,857) | |||||||||||||||||||
| INCOME TAX BENEFIT (PROVISION) | (1,265) | (1,981) | 9,732 | (3,054) | |||||||||||||||||||
NET INCOME (LOSS) | 15,651 | (43,665) | 18,691 | (87,911) | |||||||||||||||||||
LESS: NET INCOME (LOSS) ATTRIBUTABLE TO NON-CONTROLLING INTERESTS | 8,207 | (23,303) | 10,024 | (47,069) | |||||||||||||||||||
NET INCOME (LOSS) ATTRIBUTABLE TO CONTROLLING INTEREST | $ | 7,444 | $ | (20,362) | $ | 8,667 | $ | (40,842) | |||||||||||||||
| LESS: CUMULATIVE PREFERRED STOCK DIVIDENDS | 9,570 | — | 9,570 | — | |||||||||||||||||||
| NET LOSS ATTRIBUTABLE TO CLASS A COMMON STOCKHOLDERS | $ | (2,126) | $ | (20,362) | $ | (903) | $ | (40,842) | |||||||||||||||
| NET INCOME (LOSS) PER SHARE: | |||||||||||||||||||||||
| Basic | $ | (0.63) | $ | (6.23) | $ | (0.27) | $ | (12.52) | |||||||||||||||
| Diluted | $ | (0.63) | $ | (6.23) | $ | (0.27) | $ | (12.52) | |||||||||||||||
| WEIGHTED AVERAGE COMMON SHARES OUTSTANDING: | |||||||||||||||||||||||
| Basic | 3,362 | 3,267 | 3,325 | 3,263 | |||||||||||||||||||
| Diluted | 3,362 | 3,267 | 3,325 | 3,263 | |||||||||||||||||||
P3 HEALTH PARTNERS INC. and SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
(unaudited)
| Six Months Ended June 30, | |||||||||||
| 2026 | 2025 | ||||||||||
| CASH FLOWS FROM OPERATING ACTIVITIES: | |||||||||||
Net income (loss) | $ | 18,691 | $ | (87,911) | |||||||
Adjustments to reconcile net income (loss) to net cash used in operating activities: | |||||||||||
| Noncash reduction of prior period medical expense | (56,000) | — | |||||||||
| Depreciation and amortization | 42,118 | 42,135 | |||||||||
| Mark-to-market adjustment of stock warrants and purchased put option | 16,036 | (5,324) | |||||||||
Paid in-kind interest expense | 14,710 | 10,619 | |||||||||
| Premium deficiency reserve | (13,374) | (12,929) | |||||||||
| Amortization of original issue discount and debt issuance costs | 3,403 | 402 | |||||||||
| Equity-based compensation | 1,917 | 3,271 | |||||||||
| Deferred income taxes | 478 | — | |||||||||
Loss on asset sale and disposal | 127 | — | |||||||||
| Changes in operating assets and liabilities: | |||||||||||
| Health plan receivable | (27,173) | 27,803 | |||||||||
| Clinic fees, insurance, and other receivable | (5,975) | (3,625) | |||||||||
| Prepaid expenses and other current assets | (9,187) | (1,747) | |||||||||
| Other long-term assets | 5,039 | (14,464) | |||||||||
| Accounts payable, accrued expenses, and other current liabilities | (3,597) | 6,200 | |||||||||
| Accrued payroll | 471 | (1,560) | |||||||||
| Health plan settlements payable | (44,182) | (13,694) | |||||||||
| Claims payable | (32,714) | 948 | |||||||||
| Accrued interest | — | — | |||||||||
| Operating lease liability | (169) | (223) | |||||||||
| Net cash used in operating activities | (89,381) | (50,099) | |||||||||
| CASH FLOWS FROM INVESTING ACTIVITIES: | |||||||||||
Other, net | (251) | — | |||||||||
| Net cash provided by (used in) investing activities | (251) | 50 | |||||||||
| CASH FLOWS FROM FINANCING ACTIVITIES: | |||||||||||
| Proceeds from issuance of preferred stock, net of issuance costs | 42,674 | — | |||||||||
| Proceeds from long-term debt, net of original issue discount | 27,000 | 45,000 | |||||||||
| Proceeds from issuance of warrants | 15,961 | — | |||||||||
| Proceeds from short-term debt | 1,044 | 1,137 | |||||||||
| Repayment of short-term and long-term debt | (626) | (682) | |||||||||
| Payment of debt issuance costs | (30) | (181) | |||||||||
| Payment of tax withholdings upon settlement of restricted stock unit awards | (4) | — | |||||||||
| Net cash provided by financing activities | 86,019 | 45,274 | |||||||||
| Net change in cash and restricted cash | (3,613) | (4,775) | |||||||||
| Cash and restricted cash, beginning of period | 25,807 | 44,102 | |||||||||
| Cash and restricted cash, end of period | $ | 22,194 | $ | 39,327 | |||||||
RECONCILIATION OF NET INCOME (LOSS) TO ADJUSTED EBITDA (LOSS)
(in thousands, except PMPM)
(unaudited)
| Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||
| Net income (loss) | $ | 15,651 | $ | (43,665) | $ | 18,691 | $ | (87,911) | |||||||||||||||
| Interest expense, net | 7,862 | 10,145 | 24,628 | 18,870 | |||||||||||||||||||
| Depreciation and amortization | 21,044 | 21,083 | 42,118 | 42,135 | |||||||||||||||||||
Income tax provision (benefit) | 1,265 | 1,981 | (9,732) | 3,054 | |||||||||||||||||||
| Mark-to-market of stock warrants and purchased put option | 16,366 | (2,002) | 16,036 | (5,324) | |||||||||||||||||||
| Premium deficiency reserve | (8,659) | (5,967) | (13,374) | (12,929) | |||||||||||||||||||
| Equity-based compensation | 866 | 1,463 | 1,917 | 3,271 | |||||||||||||||||||
Other(1) | 50 | (148) | (80) | (466) | |||||||||||||||||||
Adjusted EBITDA (loss) | $ | 54,445 | $ | (17,110) | $ | 80,204 | $ | (39,300) | |||||||||||||||
| Adjusted EBITDA (loss) PMPM | $ | 173 | $ | (49) | $ | 127 | $ | (87) | |||||||||||||||
_____________________________________________
(1)Other during the three and six months ended June 30, 2026 consisted of interest income partially offset by valuation allowance on our notes receivable. Other during the three and six months ended June 30, 2025 consisted of interest income partially offset by severance expense in connection with reorganization of workforce.
MEDICAL MARGIN
(in thousands, except PMPM)
(unaudited)
| Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||
| Capitated revenue | $ | 366,398 | $ | 351,724 | $ | 745,897 | $ | 721,241 | |||||||||||||||
| Less: medical claims expense | (268,595) | (321,109) | (574,437) | (673,426) | |||||||||||||||||||
| Medical margin | $ | 97,803 | $ | 30,615 | $ | 171,460 | $ | 47,815 | |||||||||||||||
| Medical margin PMPM | $ | 311 | $ | 88 | $ | 271 | $ | 69 | |||||||||||||||
RECONCILIATION OF GROSS PROFIT (LOSS) TO MEDICAL MARGIN
(in thousands)
| Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||
| Gross profit (loss) | $ | 86,004 | $ | 4,438 | $ | 136,370 | $ | 5,620 | |||||||||||||||
| Other revenue | (19,983) | (4,064) | (26,874) | (7,772) | |||||||||||||||||||
| Other medical expense | 31,782 | 30,241 | 61,964 | 49,967 | |||||||||||||||||||
| Medical margin | $ | 97,803 | $ | 30,615 | $ | 171,460 | $ | 47,815 | |||||||||||||||
RECONCILIATION OF TOTAL OPERATING EXPENSE TO ADJUSTED OPERATING EXPENSE
(in thousands)
(unaudited)
| Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||
| Total operating expense | $ | 345,155 | $ | 389,912 | $ | 723,308 | $ | 801,225 | |||||||||||||||
| Medical expense | (300,377) | (351,350) | (636,401) | (723,393) | |||||||||||||||||||
| Depreciation and amortization | (21,044) | (21,083) | (42,118) | (42,135) | |||||||||||||||||||
| Premium deficiency reserve | 8,659 | 5,967 | 13,374 | 12,929 | |||||||||||||||||||
| Equity-based compensation | (866) | (1,463) | (1,917) | (3,271) | |||||||||||||||||||
| Other | — | 133 | — | 195 | |||||||||||||||||||
| Adjusted operating expense | $ | 31,527 | $ | 22,116 | $ | 56,246 | $ | 45,550 | |||||||||||||||