P3 Health Partners Inc (NASDAQ:PIII) Reports Q2 2025 Earnings Miss but Shares Surge on Profitability Optimism

P3 Health Partners Inc (NASDAQ:PIII) reported its second-quarter 2025 financial results, missing analyst expectations on both revenue and earnings per share (EPS). The company posted revenue of $355.8 million, a 6% decline year-over-year, falling short of the consensus estimate of $365.4 million. Adjusted EPS came in at -$6.23, significantly below the estimated -$4.83.

Key Financial Highlights

• Revenue Decline: The $355.8 million in Q2 revenue reflects a 9% reduction in at-risk membership due to network and payer rationalization. However, per-member funding improved by 10% when adjusted for prior-period items.
• Medical Margin: Medical margin stood at $30.6 million ($89 per member per month, or PMPM), or $39.3 million ($114 PMPM) excluding prior-period adjustments.
• Adjusted EBITDA Loss: The company reported an adjusted EBITDA loss of $17.1 million ($50 PMPM), or $8.5 million ($25 PMPM) excluding prior-period adjustments.
• Net Loss: Net loss attributable to controlling interest was $20.4 million, compared to $12.0 million in the prior-year quarter.

Market Reaction

Following the earnings release, PIII shares saw an after-hours surge of 7.3%, suggesting investor optimism despite the earnings miss. This reaction may be attributed to management’s commentary on cost control and progress toward profitability. CEO Aric Coffman emphasized the company’s $130 million EBITDA improvement plan and identified an additional $120–170 million in potential EBITDA opportunities. Three of P3’s four markets are already EBITDA positive or at breakeven, reinforcing confidence in the company’s path to sustained profitability by 2026.

Outlook vs. Analyst Estimates

The company revised its full-year 2025 guidance, projecting:

• Revenue: $1.35–$1.50 billion (vs. analyst consensus of $1.464 billion)
• Adjusted EBITDA Loss: $(69)–$(39) million (no direct consensus available)

While the revenue outlook appears slightly below expectations, management’s focus on cost discipline and margin improvement may be resonating with investors.

Summary of Press Release Highlights

• Membership rationalization led to lower revenue but improved per-member economics.
• Medical cost trends remained flat, supporting margin stability.
• Three out of four markets are EBITDA positive or breakeven.
• The company reaffirmed its long-term profitability target for 2026.

For a deeper dive into P3 Health Partners’ earnings and estimates, visit the earnings page.

Disclaimer: This article is for informational purposes only and does not constitute investment advice.