Progyny signals $200M share repurchase and targets $1.278B 2025 revenue while expanding supplemental fertility plans

Earnings Call Insights: Progyny, Inc. (PGNY) Q3 2025

MANAGEMENT VIEW

* CEO Peter Anevski highlighted a strong quarter, stating "Progyny had a very strong third quarter with revenue and profitability that exceeded the high end of our guidance ranges." Anevski emphasized member engagement and announced a third consecutive raise of full year guidance, noting, "we have now increased the midpoint of our revenue guidance by more than $70 million, above the midpoint of our original range for this year."
* Anevski described a successful selling season, adding over 80 new logos and approximately 900,000 lives, and pointed to "near 100% renewal of existing clients in covered lives for 2026."
* Strategic expansion was unveiled with the announcement of a supplemental plan for fertility and family building aimed at small and midsized companies, and the launch of Progyny Global, which targets multinational employers with integrated reproductive health services.
* Anevski revealed a new $200 million share repurchase program: "we're pleased to return value to our investors through the announcement of a new share repurchase program for up to $200 million."
* CFO Mark Livingston reported, "we continue to see good revenue growth, 9% on an as-reported basis in the quarter or 23% when excluding the impact of a large former client in the year ago period." Livingston also highlighted, "revenue exceeded the top end of our guidance by more than $8 million."
* Livingston detailed profitability achievements, citing "a 23% gross margin and a 17.5% adjusted EBITDA margin," and operating cash flow of more than $50 million for the quarter, bringing the nine-month total to a record $156 million.

OUTLOOK

* Livingston stated, "we have narrowed our assumption for full year utilization to 1.05% at the low end and 1.06% at the high end. This is still lower than the 1.07% we saw in 2024."
* For Q4, the company projects revenue between $292.7 million to $307.7 million and adjusted EBITDA between $45.3 million to $49.3 million. Net income is expected between $12.5 million to $15.5 million, or $0.14 to $0.17 in EPS.
* Full-year 2025 guidance now stands at revenue of $1.263 billion to $1.278 billion, adjusted EBITDA of $216 million to $220 million, and net income between $58.5 million to $61.5 million, equating to $0.65 to $0.68 EPS.

FINANCIAL RESULTS

* Livingston explained that third quarter revenue grew 9% on an as-reported basis and 23% excluding a large former client, with member engagement and utilization rates meeting or exceeding guidance.
* The company achieved a 23% gross margin and 17.5% adjusted EBITDA margin, with $50 million in operating cash flow for the quarter and $156 million for the first nine months.
* CapEx for Q3 was $4.7 million, a $2.9 million increase over the prior year, reflecting investments in member experience and acquisition integration. Working capital as of September 30 was approximately $412 million, including $345 million in cash, cash equivalents, and marketable securities. There is no debt and no current use of the $200 million revolving credit facility.

Q&A

* Jailendra Singh, Truist Securities: Asked about the 900,000 new covered lives and implications for revenue and future pipeline. President Michael Sturmer responded, "the team executed really well against that to get us to the $900,000 sales year this year... we do have a larger volume this year of those deals, probably as a result of that slower developing pipeline."
* Singh inquired about the administration's focus on fertility medication affordability, to which Anevski responded that existing patient assistance programs have not impacted covered benefits and "I don't expect there to be an impact on covered benefits and/or what manufacturers have in terms of pricing for covered benefits."
* Brian Tanquilut, Jefferies: Asked about employer layoffs and utilization. Anevski said, "We're not seeing anything relative to anything of size or meaning with respect to layoffs."
* Michael Cherny, Leerink Partners: Queried about cash drug prices versus client net prices. Anevski noted that cash pricing varies but has not affected covered pricing.
* Cherny also asked about upsell potential. Sturmer explained client meetings occur quarterly and that "the teams have more products and services to talk with clients about."
* Scott Schoenhaus, KeyBanc: Discussed normalization of utilization trends and guidance variability. Anevski stated, "we have increased and taken into account in the guidance ranges... factoring in that variability that we've seen in -- over the last couple of years."
* Nisala Devanath Weerasuriya, BofA: Inquired about ART cycles per utilizer and seasonality. Anevski explained, "the base book of business does go down a little bit in Q4 versus Q3, mostly because of the holidays."
* David Larsen, BTIG: Asked about the supplemental product for small and mid-market companies. Anevski clarified, "it's not a cash-based solution. It's a covered solution... it provides a solution that's more predictable relative to expectations around cost."

SENTIMENT ANALYSIS

* Analysts focused on questions regarding growth drivers, client acquisition, and macroeconomic influences, with a generally positive but probing tone, especially around selling season dynamics and new product impact.
* Management maintained a confident and constructive tone during prepared remarks and Q&A, frequently emphasizing execution, diversification, and product innovation. Anevski stated, "we are well positioned to continue our growth trajectory into the next year and beyond."
* Compared to the previous quarter, both analysts and management appeared more optimistic, with greater focus on forward opportunities and less concern about macro uncertainties.

QUARTER-OVER-QUARTER COMPARISON

* The company again raised full-year guidance, compared to the previous quarter's upward revision, reflecting continued revenue outperformance and member growth.
* Strategic focus shifted more strongly toward supplemental products for smaller employers and global expansion, compared to last quarter's emphasis on product integration and new leadership hires.
* Analysts continued to press for clarity on selling season dynamics and utilization rates, but management provided more concrete updates on new product launches and capital deployment.
* Key financial metrics such as operating cash flow and adjusted EBITDA margin improved, and management's tone shifted toward proactive capital return and growth investments.

RISKS AND CONCERNS

* Management cited potential for "further variability in activity and treatments, particularly at the low end of our ranges," as a continuing risk.
* Analysts raised concerns about the impact of macroeconomic factors, employer layoffs, and the effect of drug pricing initiatives, but management indicated that these have not had material impact.
* No client has reduced benefits "in any meaningful way next year," and retention remains nearly 100% for 2026.

FINAL TAKEAWAY

Progyny management underscored a quarter of strong growth, improved profitability, and robust client retention, while announcing a $200 million share repurchase program and new supplemental fertility benefit products targeting small and midsized employers. With expanding international offerings and a diversified client base, the company projects higher full-year revenue and earnings, supported by significant cash flow and disciplined investment. The outlook remains positive, driven by sustained demand for its solutions and ongoing product innovation.

Read the full Earnings Call Transcript [https://seekingalpha.com/symbol/pgny/earnings/transcripts]

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