Astrana Health, Inc.

Previous wording

Through our risk-bearing organizations with more than 12,000 contracted physicians, we are responsible for coordinating care in value-based care arrangements for over 1.0 million patients as of March 31, 2025. These covered patients are comprised of managed care members whose health coverage is provided either through their employers, acquired directly from a health plan, or as a result of their eligibility for Medicaid or Medicare benefits. Our managed patients benefit from an integrated approach that places physicians at the center of patient care and utilizes sophisticated risk management techniques and clinical protocols to provide high-quality, cost-effective care.

Current wording

Through our risk-bearing organizations with more than 13,000 contracted physicians, we are responsible for coordinating care in value-based care arrangements for over 1.0 million patients as of June 30, 2025. These covered patients are comprised of managed care members whose health coverage is provided either through their employers, acquired directly from a health plan, or as a result of their eligibility for Medicaid or Medicare benefits. Our managed patients benefit from an integrated approach that places physicians at the center of patient care and utilizes sophisticated risk management techniques and clinical protocols to provide high-quality, cost-effective care.

Previous wording

Adjusted EBITDA and Adjusted EBITDA margin are supplemental performance measures of our operations for financial and operational decision-making, and are used as a supplemental means of evaluating period-to-period comparisons on a consistent basis. Adjusted EBITDA is calculated as earnings before interest, taxes, depreciation, and amortization, excluding income or loss from equity method investments, non-recurring and non-cash transactions, and stock-based compensation. The Company defines Adjusted EBITDA margin as Adjusted EBITDA over total revenue.

Current wording

Adjusted EBITDA and Adjusted EBITDA margin are supplemental performance measures of our operations for financial and operational decision-making, and are used as a supplemental means of evaluating period-to-period comparisons on a consistent basis. Adjusted EBITDA is calculated as earnings before interest, taxes, depreciation, and amortization, excluding income or loss from equity method investments, non-recurring and non-cash transactions, and stock-based compensation. We define Adjusted EBITDA margin as Adjusted EBITDA over total revenue.

Previous wording

As of March 31, 2025 and 2024, we managed a total of 20 and 18 independent risk-bearing organizations, including both affiliated and non-affiliated, respectively. The total number of patients for whom we managed the delivery of healthcare services was over 1.0 million as of March 31, 2025 and 2024.

Current wording

As of June 30, 2025 and 2024, we managed a total of 21 and 18 independent risk-bearing organizations, including both affiliated and non-affiliated, respectively. The total number of patients for whom we managed the delivery of healthcare services was over 1.0 million and approximately 1.0 million as of June 30, 2025 and 2024, respectively.

Previous wording

Total revenue for the three months ended March 31, 2025, was $620.4 million, as compared to $404.4 million for the three months ended March 31, 2024, an increase of $216.0 million, or 53%. The increase in revenue was primarily attributable to capitation revenue. Capitation revenue increased by $218.0 million primarily as a result of our recent acquisitions within our Care Partners segment, along with enrollees transitioning to full risk through the Company’s Restricted Knox-Keene plans.

Current wording

Total revenue for the three months ended June 30, 2025, was $654.8 million, as compared to $486.3 million for the three months ended June 30, 2024, an increase of $168.5 million, or 35%. The increase in revenue was primarily attributable to capitation revenue. Capitation revenue increased by $171.5 million primarily as a result of our recent acquisitions within our Care Partners segment, along with enrollees transitioning to full risk through our Restricted Knox-Keene plans.

Previous wording

Expenses related to cost of services, excluding depreciation and amortization for the three months ended March 31, 2025 were $549.1 million as compared to $330.4 million for the same period in 2024, an increase of $218.7 million or 66%. The overall increase was primarily due to increased participation in a value-based Medicare FFS model and medical costs associated with both professional and institutional risk of our Restricted Knox-Keene licensed health plan as a result of our recent acquisitions within our Care Partners segment which were commensurate to our increase in revenue.

Current wording

Expenses related to cost of services, excluding depreciation and amortization for the three months ended June 30, 2025, were $576.8 million, as compared to $412.8 million for the same period in 2024, an increase of $164.0 million or 40%. The overall increase was primarily due to increased participation in a value-based Medicare FFS model and medical costs associated with both professional and institutional risk of our Restricted Knox-Keene licensed health plans as a result of our recent acquisitions within our Care Partners segment which were commensurate to our increase in revenue.

Previous wording

General and administrative expenses for the three months ended March 31, 2025 were $43.9 million, as compared to $38.7 million for the same period in 2024, an increase of $5.2 million or 13%. The increase was primarily due to increased general and administrative expenses to support operational growth such as stock-based compensation.

Current wording

General and administrative expenses for the three months ended June 30, 2025, were $50.7 million, as compared to $36.0 million for the same period in 2024, an increase of $14.8 million or 41%. The increase was primarily due to increased general and administrative expenses to support operational growth such as stock-based compensation and transaction costs incurred for the Prospect transaction.

Previous wording

Depreciation and amortization expenses for the three months ended March 31, 2025 were $6.8 million, as compared to $5.1 million for the same period in 2024, an increase of $1.8 million or 34%. This amount includes depreciation of property and equipment and the amortization of intangible assets. The increase in depreciation and amortization was primarily related to the amortization of our acquired intangibles as a result of our recent business combinations.

Current wording

Depreciation and amortization expenses for the three months ended June 30, 2025, were $6.9 million, as compared to $7.4 million for the same period in 2024, a decrease of $0.5 million or 7%. This amount includes depreciation of property and equipment and the amortization of intangible assets.

Previous wording

Interest expense for the three months ended March 31, 2025 was $7.3 million as compared to $7.6 million for the same period in 2024, a decrease of $0.3 million 4%. The decrease in interest expense was primarily due to a decrease in interest rates on our floating-rate debt. The interest rate for the Revolver and Term Loan was 5.82% as of March 31, 2025 and 7.42% for the Revolver and 7.68% for the Term Loan, respectively, as of March 31, 2024. This was offset by an increase in borrowings under the Second Amended and Restated Credit Facility. As of March 31, 2025, the Company borrowed $412.0 million on the Second Amended and Restated Credit Facility compared to $391.3 million as of March 31, 2024.

Current wording

Interest expense for the three months ended June 30, 2025 was $7.4 million as compared to $8.6 million for the same period in 2024, a decrease of $1.2 million or 14%. The decrease in interest expense was primarily due to a decrease in interest rates on our floating-rate debt. The interest rate for both the Revolver Loan and Term Loan was 6.08% as of June 30, 2025 and 7.43% as of June 30, 2024. In addition, there was a decrease in outstanding borrowings under the Second Amended and Restated Credit Facility. As of June 30, 2025, we borrowed $408.9 million on the Second Amended and Restated Credit Facility compared to $435.7 million borrowed under the facility as of June 30, 2024.

Previous wording

Interest income for the three months ended March 31, 2025 was $2.3 million as compared to $4.0 million for the three months ended March 31, 2024, a decrease of $1.7 million or 42%. Interest income reflects interest earned on cash held in bank accounts, money market and certificate of deposit accounts, and the interest from our loan receivables. The decrease in interest income was primarily due to a decrease in our cash held in interest bearing bank accounts.

Current wording

Interest income for the three months ended June 30, 2025 was $2.3 million as compared to $3.5 million for the same period in 2024, a decrease of $1.2 million or 34%. Interest income reflects interest earned on cash held in bank accounts, money market and certificate of deposit accounts, and the interest from our loan receivables. The decrease in interest income was primarily due to a decrease in our cash held in interest bearing bank accounts.

Previous wording

Other loss for the three months ended March 31, 2025 was $5.1 million as compared to $4.3 million for the same period in 2024, a decrease of $0.8 million or 19%. The increase in other loss was primarily due to debt issuance costs that were expensed in connection with the Second Amended and Restated Credit Facility.

Current wording

Other loss for the six months ended June 30, 2025 was $3.9 million as compared to other income of $1.9 million for the same period in 2024, a decrease of $5.8 million or 313%. The increase in other loss was primarily due to debt issuance costs that were expensed in connection with the Second Amended and Restated Credit Facility.

Previous wording

Provision for income taxes was $3.4 million for the three months ended March 31, 2025, as compared to $7.1 million for the same period in 2024, a decrease of $3.8 million. The decrease in provision for income taxes was primarily due to a decrease in pre-tax income.

Current wording

Provision for income taxes was $6.6 million for the three months ended June 30, 2025, as compared to $10.0 million for the same period in 2024, a decrease of $3.4 million. The decrease in provision for income taxes was primarily due to a decrease in pre-tax income.

Previous wording

Net loss attributable to non-controlling interests for the three months ended March 31, 2025 was a loss of 0.5 million as compared to income of $2.0 million for the same period in 2024, a decrease of $2.5 million. The decrease was primarily driven by a decrease net income.

Current wording

Net income attributable to non-controlling interests for the three months ended June 30, 2025, was $0.8 million, as compared to $2.7 million for the same period in 2024, a decrease of $1.9 million. The decrease was primarily driven by a decrease in net income.

Previous wording

Our net income attributable to Astrana Health, Inc., for the three months ended March 31, 2025 was $6.7 million as compared to $14.8 million for the same period in 2024, a decrease of $8.1 million.

Current wording

Our net income attributable to Astrana Health, Inc., for the three months ended June 30, 2025, was $9.4 million, as compared to $19.2 million for the same period in 2024, a decrease of $9.7 million.

Previous wording

Adjusted EBITDA for the three months ended March 31, 2025 was $36.4 million, as compared to $42.2 million for the same period in 2024, a decrease of $5.8 million. The decrease was primarily due to a decrease in operating income as a result of higher utilization and increase in general and administrative expenses. See “Reconciliation of Net Income to EBITDA, Adjusted EBITDA, and Adjusted EBITDA Margin” below for additional information.

Current wording

Adjusted EBITDA for the six months ended June 30, 2025, was $84.5 million, as compared to $90.2 million for the same period in 2024, a decrease of $5.7 million. The decrease was primarily due to a decrease in operating income as a result of higher utilization and an increase in general and administrative expenses.

Previous wording

The Company currently has three reportable segments consisting of Care Partners, Care Delivery, and Care Enablement. The Company evaluates the performance of its operating segments based on segment revenue growth as well as operating income. Management uses revenue growth and total segment operating income as a measure of the performance of operating businesses separate from non-operating factors. For more information about our segments, see Note 18 — “Segments” to our condensed consolidated financial statements under Item 1 in this Quarterly Report on Form 10-Q for additional information.

Current wording

The Company currently has three reportable segments consisting of Care Partners, Care Delivery, and Care Enablement. We evaluate the performance of our operating segments based on segment revenue growth as well as operating income. Management uses revenue growth and total segment operating income as a measure of the performance of operating businesses, separate from non-operating factors. For more information about our segments, see Note 17 — “Segments” to our condensed consolidated financial statements under Item 1 in this Quarterly Report on Form 10-Q for additional information.

Previous wording

The following table sets forth our revenue and operating income by segment for the three months ended March 31, 2025 and 2024 (in thousands):

Current wording

The following table sets forth our revenue and operating income by segment for the three and six months ended June 30, 2025 and 2024 (in thousands):

Previous wording

Revenue for the three months ended March 31, 2025 was $33.4 million as compared to $30.7 million for the three months ended March 31, 2024, an increase of $2.7 million or 9%. Operating loss for the three months ended March 31, 2025 was $3.1 million, as compared to a loss of $0.2 million for the three months ended March 31, 2024, an increase in operating loss of $2.9 million. The increase in revenue was primarily driven by increased volume in patient visits at our primary, multi-specialty, and ancillary Care Delivery entities. The increase in operating loss was due to an increase in expenses incurred related to our newer clinic locations that opened.

Current wording

Revenue for the six months ended June 30, 2025, was $71.8 million, as compared to $65.6 million for the six months ended June 30, 2024, an increase of $6.2 million. Operating loss for the six months ended June 30, 2025, was $1.0 million as compared to income of $1.6 million for the six months ended June 30, 2024, an increase in operating loss of $2.5 million. The increase in revenue was primarily driven by an increased volume in patient visits at our primary, multi-specialty, and ancillary Care Delivery entities. The increase in operating loss was due to an increase in expenses incurred related to our newer clinic locations that opened.

Previous wording

Revenue for the three months ended March 31, 2025 was $39.6 million, as compared to $33.3 million for three months ended March 31, 2024, an increase of $6.3 million or 19%. Operating income for the three months ended March 31, 2025 was $3.5 million, as compared to operating income of $3.5 million for the three months ended March 31, 2024. The increase in revenue was primarily due to managing more IPAs in our Care Partners segment.

Current wording

Revenue for the three months ended June 30, 2025, was $40.9 million, as compared to $36.2 million for three months ended June 30, 2024, an increase of $4.7 million. Operating income for the three months ended June 30, 2025 was $1.8 million, as compared to operating income of $6.9 million for the three months ended June 30, 2024. The increase in revenue was primarily due to managing more IPAs in our Care Partners segment. The decrease in operating income was due to higher costs as a result of an increase in the workforce that provides management and administrative services.

Previous wording

Set forth below are reconciliations of Net Income to EBITDA and Adjusted EBITDA, as well as the reconciliation to Adjusted EBITDA margin for the three months ended March 31, 2025 and 2024. The Company defines Adjusted EBITDA margin as Adjusted EBITDA over total revenue.

Current wording

Set forth below are reconciliations of Net Income to EBITDA and Adjusted EBITDA, as well as the reconciliation to Adjusted EBITDA margin for the three and six months ended June 30, 2025 and 2024. We define Adjusted EBITDA margin as Adjusted EBITDA over total revenue.

Previous wording

Other, net for the three months ended March 31, 2025 relates to debt issuance costs expensed in connection with our Second Amended and Restated Credit Facility, transaction costs for our acquisition of Prospect, data transition costs for our recent acquisitions, certain costs associated with the CHS transaction, non-cash changes related to change in the fair value of our call option and Collar Agreement, and severance fees incurred.

Current wording

Other, net for the six months ended June 30, 2025 relates to debt issuance costs expensed in connection with our Second Amended and Restated Credit Facility, transaction costs for the Prospect Transaction, data transition costs for our recent acquisitions, certain costs associated with the CHS transaction, non-cash changes related to change in the fair value of our call option and Collar Agreement, and severance fees incurred.

Previous wording

Other, net for the three months ended March 31, 2024 relates to financial guarantee via a letter of credit that we provided almost three years ago in support of two local provider-led ACOs, non-cash changes related to change in the fair value of our financing obligation to purchase the remaining equity interests in one of our investments, non-cash changes related to change in the fair value of the Company’s Collar Agreement, and transaction costs incurred for our investments and tax restructuring fees.

Current wording

Other, net for six months ended June 30, 2024 relates to financial guarantee via a letter of credit that we provided almost three years ago in support of two local provider-led ACOs, non-cash changes related to change in the fair value of our financing obligation to purchase the remaining equity interests in one of our investments, non-cash changes related to change in the fair value of the Company’s Collar Agreement, transaction costs incurred for our investments and tax restructuring fees, and reimbursement from a related party of the Company for taxes associated with the Excluded Assets spin-off.

Previous wording

Cash, cash equivalents, and investment in marketable securities at March 31, 2025 totaled $260.9 million as compared to $290.8 million at December 31, 2024. Working capital totaled $252.0 million at March 31, 2025, as compared to $272.9 million at December 31, 2024, a decrease of $20.9 million.

Current wording

Cash, cash equivalents, and investment in marketable securities at June 30, 2025, totaled $342.1 million, as compared to $290.8 million at December 31, 2024. Working capital totaled $269.4 million at June 30, 2025, as compared to $272.9 million at December 31, 2024, a decrease of $3.5 million.

Previous wording

We have historically financed our operations primarily through internally generated funds and borrowings on long-term debt. We generate cash primarily from capitation contracts, risk pool settlements and incentives, fees for medical management services provided to our affiliated physician groups, and FFS reimbursements. We generally invest cash in money market accounts and certificates of deposit, which are classified as cash and cash equivalents. In February 2025, the Company entered into the Second Amended and Restated Credit Agreement which amended and restated that certain amended credit agreement and provided for a five-year revolving credit facility of $300.0 million, a term loan of $250.0 million, and a delayed-draw term loan of $745.0 million, which were primarily used to refinance certain existing indebtedness and intended to be used primarily to fund the costs associated with closing the Transaction. In addition, we have a current shelf registration statement filed with the SEC under which we may issue common stock, preferred stock, debt securities, and other securities that may be offered in one or more offerings on terms to be determined at the time of the offering. We believe we have sufficient liquidity to fund our operations through at least the next 12 months and the foreseeable future.

Current wording

We have historically financed our operations primarily through internally generated funds and borrowings on long-term debt. We generate cash primarily from capitation contracts, risk pool settlements and incentives, fees for medical management services provided to our affiliated physician groups, and FFS reimbursements. We generally invest cash in money market accounts and certificates of deposit, which are classified as cash and cash equivalents. In February 2025, we entered into the Second Amended and Restated Credit Agreement which amended and restated that certain amended credit agreement and provided for a five-year revolving credit facility of $300.0 million, a term loan of $250.0 million, and a delayed-draw term loan of $745.0 million, which were primarily used to refinance certain existing indebtedness and to fund the costs associated with the Prospect Transaction. In addition, we have a current shelf registration statement filed with the SEC under which we may issue common stock, preferred stock, debt securities, and other securities that may be offered in one or more offerings on terms to be determined at the time of the offering. We believe we have sufficient liquidity to fund our operations through at least the next 12 months and the foreseeable future.

Previous wording

Cash provided by operating activities for the three months ended March 31, 2025 was $16.6 million, as compared to cash provided by operating activities of $6.0 million for the three months ended March 31, 2024. The increase in cash provided by operating activities was primarily driven by adjusted net income and changes in working capital. For the three months ended March 31, 2025, net income, exclusive of depreciation and amortization, amortization of debt issuance cost, share-based compensation, non-cash lease expense, change in fair value of contingent consideration liabilities, loss on debt extinguishment, unrealized gains or losses on investments, loss from equity method investments, deferred tax, and other was $24.6 million compared to $29.1 million for the three months ended March 31, 2024. Working capital for the three months ended March 31, 2025, decreased operating cash flow by $8.0 million, compared to a $23.2 million decrease in operating cash flow for the three months ended March 31, 2024. The change in working capital for the three months ended March 31, 2025 was mainly driven by an increase in receivables, net, including amounts with related parties, primarily due to timing of our receivables, including risk pool settlements that occur approximately 18 months after the risk pool performance year is completed, and a decrease in fiduciary accounts payable as a result of paying our sub-IPAs and providers. The decrease to operating cash flow due to changes in working capital was partially offset by an increase in medical liabilities due to timing of payments and a decrease in other receivables attributable to collections on reimbursements.

Current wording

Cash provided by operating activities for the six months ended June 30, 2025, was $107.5 million, as compared to cash provided by operating activities of $29.2 million for the six months ended June 30, 2024. The increase in cash provided by operating activities was primarily driven by favorable changes in working capital, partially offset by lower adjusted net income. Working capital for the six months ended June 30, 2025, increased operating cash flow by $51.6 million, compared to a $36.1 million decrease in operating cash flow for the six months ended June 30, 2024. The change in working capital for the 2025 and 2024 periods included timing of claims payments related to our medical liabilities and a decrease in cash paid for income taxes. For the six months ended June 30, 2025, net income, exclusive of depreciation and amortization, amortization of debt issuance cost, share-based compensation, non-cash lease expense, deferred tax, and other was $56.0 million, compared to $65.3 million for the six months ended June 30, 2024.

Previous wording

Cash used in investing activities during the three months ended March 31, 2025, was $2.4 million, primarily due to purchases of property and equipment of $3.1 million. The cash used in investing activities was partially offset by proceeds from repayment of a loan receivable of $0.6 million and distribution received from an equity method investment of $0.1 million. Cash used in investing activities during the three months ended March 31, 2024, was $71.0 million primarily due to payments for business and asset acquisitions, net of cash acquired of $50.6 million, issuances of loans of $20.0 million, and purchases of property and equipment of $0.4 million.

Current wording

Cash used in investing activities during the six months ended June 30, 2025, was $3.5 million, primarily due to purchases of property and equipment of $4.5 million and issuance of loan of $1.1 million. The cash used in investing activities was partially offset by other investing activities of $2.1 million consisting of proceeds from repayment of loans, purchase of marketable securities, and distribution from investments - equity method. Cash used in investing activities during the six months ended June 30, 2024, was $151.0 million primarily due to payments for business and asset acquisitions, net of cash acquired of $114.6 million, issuances of loans of $21.0 million, purchase of investment – equity method of $6.0 million, purchase of call options issued in conjunction with equity method investment of $3.9 million, purchases of property and equipment of $3.2 million, and other investing activities of $2.3 million consisting of purchase of investments, proceeds from repayment of loans, and purchase of marketable securities.

Previous wording

Cash used in financing activities during the three months ended March 31, 2025, was $44.2 million, primarily due to repayments of debt of $428.2 million, payment of deferred financing costs of $17.2 million, tax payments from net share settlement of restricted stock awards and units of $4.1 million, dividend payments of $5.5 million, APC repurchase of their treasury shares of $1.3 million, and repayment of finance lease obligations of $0.1 million. This was partially offset by borrowings of long-term debt of $412.0 million and proceeds from ESPP purchases of $0.3 million. Cash provided by financing activities during the three months ended March 31, 2024, was $106.4 million, primarily due to borrowings on long-term debt totaling $110.0 million, partially offset by repayment of long term-debt of $3.5 million.

Current wording

Cash used in financing activities during the six months ended June 30, 2025, was $52.8 million, primarily due to repayments of debt of $431.4 million, payment of deferred financing costs of $17.2 million, tax payments from net share settlement of restricted stock awards and units of $5.1 million, dividend payments of $6.2 million, and other financing activities of $4.9 million consisting of proceeds from ESPP issuances, payment of finance lease obligations, repurchase of common stock, repurchase of treasury shares, purchase and sale of non-controlling interest, and payment of contingent liabilities. This was partially offset by borrowings of long-term debt of $412.0 million. Cash provided by financing activities during the six months ended June 30, 2024, was $153.6 million, primarily due to borrowings on long-term debt totaling $170.3 million. This was partially offset by repayment of debt of $11.0 million, tax payments from net share settlement of restricted stock of $3.6 million, dividend payments of $1.9 million, and other financing activities of $0.2 million consisting of payment of finance lease obligations and sale of non-controlling interest.

Previous wording

The following are the future commitments of the Company’s debt for the years ending December 31 (in thousands) below:

Current wording

The following are the future commitments of our debt for the years ending December 31 (in thousands) below:

Previous wording

The Second Amended and Restated Credit Agreement provides for (a) a five-year revolving credit facility to the Company of $300.0 million, which includes a letter of credit sub-facility of up to $100.0 million and a swingline loan sub-facility of $25.0 million, (b) a five-year term loan A credit facility to the Company of $250.0 million and (c) a five-year delayed draw term loan credit facility to the Company of $745.0 million, maturing on February 26, 2030. Refer to Note 9 — “Credit Facility, Bank Loans, and Lines of Credit” to our condensed consolidated financial statements under Item 1 in this quarterly report on Form 10-Q for additional information.

Current wording

The Second Amended and Restated Credit Agreement provides for (a) a five-year revolving credit facility to the Company of $300.0 million, which includes a letter of credit sub-facility of up to $100.0 million and a swingline loan sub-facility of $25.0 million, (b) a five-year term loan A credit facility to the Company of $250.0 million, and (c) a five-year delayed draw term loan credit facility to the Company of $745.0 million, maturing on February 26, 2030, of which $707.3 million was drawn down in connection with closing the Prospect Transaction.