Full Transcript: Privia Health Gr Q2 2026 Earnings Call

Full Transcript: Privia Health Gr Q2 2026 Earnings Call

Privia Health Gr (NASDAQ:PRVA) released second-quarter financial results and hosted an earnings call on Thursday. Read the complete transcript below. Benzinga APIs provide real-time access to earnings call transcripts and financial data. Visit https://www.benzinga.com/apis/ to learn more. Access the full call at https://edge.media-server.com/mmc/p/v9wy7etr/ Summary Privia Health Gr reported a strong financial performance with a 12.4% growth in practice collections and a 29% increase in adjusted EBITDA year-over-year for Q2 2026. The company entered New Jersey in partnership with Neurology Group of Bergen County, marking its presence in 25 states, and raised its 2026 outlook across key financial metrics. Earn 8% APY on a Real Estate-Backed Note from $5,000 EquityMultiple's Alpine Notes have distributed $478M+ with no missed payments. Accredited investors can start with $5,000 at a fixed 8% APY for 6 months. Privia Health Gr's balance sheet remained robust with over $412 million in cash and no debt, and the company expects 70-80% of its full-year adjusted EBITDA to convert to free cash flow. The company continues to expand its value-based care programs, managing an estimated $15.7 billion in total medical spend across commercial and government risk arrangements. Privia Health Gr is deploying AI applications to improve efficiencies and expects to expand its EBITDA margin towards the high end of 30-35% over the next few years. Management remains confident in achieving sustainable earnings growth and highlighted a consistent provider retention rate of 98% over the past three years. The company emphasized its strategic initiatives including growing its community-based medical groups and expanding its ACO model, while maintaining a strong pipeline for future market expansion. OPERATOR Thank you for standing by and welcome to Privia Health Gr's second quarter 2026 earnings conference call. Currently all participants are in a listen-only mode. After the speaker's presentation, there will be a question-and-answer session. To ask a question during the session, you will need to press Star 11 on your telephone to remove yourself from the queue. You may press Star 11 again. I would now like to hand the call over to Robert Boshert, SVP of Investor and Corporate Communications. Please go ahead. Robert Boshert, SVP Investor and Corporate Communications Thank you. 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 six-month periods 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 is included in our press release and the accompanying slide presentation posted on our website. Now I'd like to turn the call over to our CEO, Parth Mehrotra. Parth Mehrotra, CEO 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 Gr 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 Neurology Group of Bergen County, a practice with 25 adult and pediatric clinicians. This represents Privia's 25th state as we build our national primary care–centric delivery network. 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 Gr footprint of community-based medical groups and value-based risk-bearing entities continues to expand. We now have 5,644 implemented providers caring for over 6.1 million patients in more than 1,300 care center locations operating across 25 states and the District of Columbia. A defining component of Privia's operating model is our gross provider retention averaging 98% over the past three years. 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 profitably 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. Thank you. David Mountcastle, CFO Privia Health Gr'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