0001628280-26-011655
SEC filingRevenue declined 2% to $5.93B; gross profit turned to loss of $160M; net loss widened to $391M.
Agilon Health is transforming healthcare by empowering primary care physicians to be agents of change through a combination of a technology platform, long-term partnerships with existing physician groups, and a growing network of like-minded physicians. The company focuses on creating a Medicare-centric, globally capitated line of business by forming risk-bearing entities (RBEs) that contract with payors and assume financial responsibility for attributed members' total healthcare costs. As of December 31, 2025, agilon had 28 anchor physician groups across 30 geographies, serving approximately 511,000 Medicare Advantage members and 114,000 Medicare fee-for-service beneficiaries via nine ACOs.
The agilon platform is a holistic set of capabilities supporting rapid transition to a total care model, including technology, people, process, and capital. Key proprietary systems include the CORE technology platform, HCC Manager risk adjustment software, and Minerva clinical data platform, all used for data aggregation and analysis. The company also holds trademarks for "agilon health" and "Medicare Quick Thinking" and uses local brands incorporating "Senior Health Connect."
Agilon focuses on outreach to existing community-based physician groups to join its platform, supported by a dedicated business development team. Locally, it creates brands to educate Medicare-eligible patients about coverage options. The company contracts with multiple payors, including large national health plans and smaller regional insurers, through one-to-three-year agreements typically renewed. Payors include national form contracts and local agreements, with multi-payor contracting creating value for physician partners.
The healthcare industry is highly competitive and fragmented. Agilon faces competition from other value-based care entities, local provider networks, hospitals, health systems, and large payors that develop their own managed care tools. While some competitors use elements of agilon's model, none offer all elements. Competitive factors include physician relationships, quality and cost outcomes, payor relationships, local geography leadership, and economic model strength.
Agilon's strategy is built on three key elements: (1) the agilon platform, which integrates technology, people, process, and capital to support physician transition to a total care model; (2) long-term partnerships (typically 20 years) with community-based physician groups, providing recurring revenue through subscription-like PMPM agreements and sharing earnings from quality and cost improvements; (3) the agilon network, a collaborative group of leading physician partners sharing best practices to enhance innovation and growth. The goal is to remove barriers preventing community-based physicians from adopting a total care model.
As of December 31, 2025, agilon employed 856 employees, substantially all full-time, with no union members or work stoppages. The company emphasizes total rewards, inclusion and belonging, training and development, and health and safety. Human capital oversight is provided by the Compensation and Human Capital Committee of the Board. The company conducts annual employee engagement surveys and offers comprehensive benefits, including unlimited PTO for exempt employees, 401(k) plan, and family leave.
For the year ended December 31, 2025, total revenue decreased 2% to $5.93 billion from $6.06 billion in 2024. The decline was primarily driven by a 2% decrease in average membership due to partnership exits in 2024 and lower risk adjustment revenue, including unfavorable prior period development. Medical services expense increased 2% to $5.98 billion, driven by a 5% increase in average cost per member from elevated medical cost trends, partially offset by lower membership. This resulted in a gross loss of $160.0 million compared to a gross profit of $4.8 million in 2024. Other medical expenses decreased 46% to $114.7 million, primarily due to lower partner physician compensation and other provider costs. General and administrative expenses decreased 11% to $238.5 million, driven by lower platform support costs and reduced investments in geography entry and severance. Impairments surged to $36.1 million from $3.6 million, mainly from goodwill and intangible asset impairments. Operating loss widened to $463.2 million from $292.1 million. Net loss attributable to common shares was $391.3 million compared to $260.2 million in 2024. Adjusted EBITDA loss increased to $296.2 million from $154.2 million.
The MD&A does not provide revenue breakdown by segment. However, membership data shows two key segments: Medicare Advantage members decreased 3% to 511,000, and CMS ACO Models attributed beneficiaries decreased 13% to 114,000. The decline in MA members was attributed to partnership exits in 2024. New geographies and growth in existing geographies partially offset revenue declines. Medical margin, a key non-GAAP measure, turned negative to ($56.6 million) from positive $205.2 million, reflecting the impact of elevated medical costs outweighing premium revenue.
Management did not provide explicit revenue or earnings guidance. The company highlighted a reverse stock split proposal and amendment to its credit facility extending maturity to February 2028, including a minimum cash balance requirement. Liquidity as of December 31, 2025 included $173.7 million in cash and $111.4 million in marketable securities. Management believes existing resources are sufficient for at least the next 12 months but may require additional capital if operating losses continue. The focus remains on managing medical cost trends and partner relationships. No specific strategic priorities or outlook for 2026 were discussed in the MD&A.
As of December 31, 2025, Agilon Health held $173.7 million in cash and cash equivalents and $111.4 million in marketable securities, totaling $285.1 million in liquid assets. Total assets were $1.27 billion, down from $1.73 billion in 2024, primarily due to a reduction in receivables and the impairment of goodwill. Total liabilities stood at $1.14 billion, with medical claims and related payables representing the largest component at $929.8 million. Stockholders' equity decreased sharply to $126.7 million from $471.0 million, driven by a net loss of $391.3 million and the full impairment of goodwill.
The Notes disclose $61.6 million in capital commitments to physician partners as of December 31, 2025. These commitments are scheduled as follows: $24.0 million due within one year, $25.7 million due in 2027-2028, and $11.9 million due thereafter. No other purchase commitments, such as supply or capacity agreements, were disclosed. The company also had $10.2 million in outstanding surety bonds related to health plan payor risk-bearing capital contributions.
In 2023, the company repurchased 9.6 million shares of common stock for $200.0 million. No share repurchases were reported for 2024 or 2025. No dividends were paid or declared. Total debt outstanding under the secured term loan was $35.0 million as of December 31, 2025, with $19.2 million classified as current and $15.8 million as long-term. The company repaid $3.75 million in 2024 and $5.0 million in 2023. Capital expenditures totaled $13.2 million in 2025, primarily for property, equipment, and capitalized software.
The company operates as a single operating and reportable segment. No segment-level revenue or profit data is disclosed beyond the consolidated totals. Geographic mix is not provided in the Notes.
Agilon Health has a history of net losses and expects expenses to increase, with no guarantee of achieving or maintaining profitability. The company's growth depends on successfully identifying and integrating new geographies, physician partners, and payors; failure to do so could materially harm the business. Medical expenses may exceed capitation revenue due to utilization or cost fluctuations, and estimates of risk adjustment factors, IBNR claims, and earnings are inherently uncertain. Significant membership reduction could occur from factors outside the company's control, including payor contract non-renewal or member disenrollment.
Agilon is economically dependent on a limited number of key payors (Humana, Aetna, UnitedHealthcare), which have increased bargaining power. Contracts are typically 1-3 years and may not be renewed. The company relies on payors for accurate membership attribution, data, and claims payment; failures could directly impact financial performance. Physician partners and other providers are critical to managing care quality and cost, but Agilon does not employ them, creating control risks. Inaccurate diagnosis data from providers could lead to overpayments, recoupments, or liability under the False Claims Act or RADV audits.
Substantially all revenue comes from Medicare Advantage, making the company highly sensitive to federal reimbursement rate changes, risk adjustment methodology modifications, and program discontinuation. The ACO REACH Model and its successor LEAD Model introduce additional uncertainty. Consolidation in healthcare could increase bargaining power of providers and payors, potentially reducing market opportunity. Negative industry publicity could lead to increased regulation or reduced member enrollment.
The healthcare industry is heavily regulated at federal, state, and local levels. Agilon must comply with fraud and abuse laws (FCA, Anti-Kickback, Stark), HIPAA, state patient confidentiality laws, and corporate practice of medicine doctrines. Violations could result in exclusion from Medicare, significant fines, or required restructuring of business arrangements. The company also faces risks from payor audits, regulatory inquiries, and potential corrective action plans that may require material capital contributions.
Agilon relies on complex information systems and third-party infrastructure to manage sensitive PHI and business data. Cybersecurity attacks, data breaches, or system failures could disrupt operations, cause liability, and damage reputation. The company's use of algorithms, AI, and machine learning introduces additional risks related to accuracy, bias, and regulatory compliance.
The company's credit facility contains restrictive covenants that limit operational flexibility. Additional capital may be required but may not be available on acceptable terms. The company's ability to service debt and fund operations depends on subsidiary performance and cash flows.
Agilon Health's cash flow statement for the year ended December 31, 2025, reveals a significant deterioration in operating cash flow, which turned negative at $(1.0 million) compared to essentially breakeven in 2024 ($1,000). This decline is primarily driven by a large net loss of $(391.3 million) and adverse working capital changes, notably a $343.2 million decrease in receivables and a $2.1 million decrease in medical claims payables. Capital expenditures (capex) were $10.0 million, resulting in negative free cash flow of $(11.0 million). The company did not engage in any share repurchases or dividend payments. The negative free cash flow and reliance on financing activities (though minimal in 2025) highlight weak cash generation relative to the net loss and capital spending.