AUSTIN, Texas - Agilon Health Inc. (NYSE:AGL) saw its shares tumble 28% after reporting disappointing third-quarter results and cutting its full-year profit outlook. The healthcare company cited challenges in the Medicare Advantage environment and unexpected costs as key factors impacting its performance.
For the third quarter, Agilon Health reported a loss of -$0.29 per share, significantly wider than the analyst estimate of -$0.10. Revenue came in at $1.45 billion, slightly below the consensus of $1.47 billion but up 28% YoY.
The company's Medicare Advantage membership grew 37% YoY to 525,000, while total members on the Agilon platform increased 39% to 657,000.
The quarter's results were negatively impacted by lower-than-expected 2024 risk adjustment, negative prior year development mainly from risk adjustment and Part D, and higher current year medical expenses. These factors led to a gross profit loss of $64 million, compared to a positive $37 million in the same quarter last year.
"Our Q3 results show that our membership is growing across our 26 partnerships, and it also highlights why we are taking necessary actions to strengthen execution within our platform and proactively manage the challenging Medicare Advantage environment," said Steve Sell, CEO of Agilon Health.
In response to these challenges, Agilon Health announced plans to exit two unprofitable partnerships and other payor contracts by the end of 2024.
Looking ahead, the company provided mixed guidance. For the fourth quarter, Agilon Health expects revenue between $1.51 billion and $1.52 billion, above the consensus of $1.46 billion.
For the full year 2024, the company forecasts revenue of $6.05 billion to $6.06 billion, slightly higher than the analyst estimate of $6.02 billion.
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