P3 Health Partners Announces Third Quarter 2026 Results
P3 Health Partners Inc. (PIII) filed an SEC Form 8-K — Results of Operations and Financial Condition. Exhibit 99.1 P3 Health Partners Announces Third Quarter 2026 Results Adjusted EBITDA of $21 Million for the Third Quarter and $101 Million Year-to-Date Raises Full-Year 2026 Adjusted EBITDA Guidance Midpoint Management to Host Conference Call and Webcast November 9, 2026 at 4:30
How this was made
The 30-second read
Why it matters
The earnings beat and guidance raise provide fresh positive data for investors, likely supporting a price rally.
Market read
The earnings release and guidance update are the primary market‑moving facts for PIII.
What to watch
Potential headwinds from payer rationalization and membership decline could temper upside.
P3 Health Partners reports Q3 2026 adjusted EBITDA of $20.9 million and net income of $30.8 million; FY2026 adjusted EBITDA guidance low end raised to $90 million
Reported quarter swung to profit on higher revenue and medical margin, but the company says the quarter includes favorable payer settlements and prior year development, nine-month operating cash flow was negative, at-risk membership fell 9%, and the filing's forward-looking statements cite going concern and debt covenant risks.
Key metrics
shortened, hover for the filing’s print| Metric | Value | q/q | y/y |
|---|---|---|---|
| Total operating revenue, Q3 2026 (three months ended Sep 30, 2026)GAAP | $396.3M | – | +15% |
| Capitated revenue, Q3 2026GAAP | $366.3M | – | – |
| Other revenue, Q3 2026GAAP | $30.05M | – | – |
| Medical expense, Q3 2026GAAP | $346.0M | – | – |
| Medical claims expense (medical margin reconciliation), Q3 2026non-GAAP | −$322.4M | – | – |
| Premium deficiency reserve (operating expense line), Q3 2026GAAP | −$27.95M | – | – |
| Corporate, general and administrative expense, Q3 2026GAAP | $34.27M | – | – |
| Depreciation and amortization, Q3 2026GAAP | $21.04M | – | – |
| Total operating expense, Q3 2026GAAP | $373.4M | – | – |
| Gross profit (loss), Q3 2026GAAP | $50.34M | – | – |
| Operating income (loss), Q3 2026GAAP | $22.98M | – | – |
| Interest expense, net, Q3 2026GAAP | −$5.04M | – | – |
| Mark-to-market of stock warrants and purchased put option, Q3 2026GAAP | $7.61M | – | – |
| Other income (expense), Q3 2026GAAP | $5.25M | – | – |
| Total other income (expense), Q3 2026GAAP | $7.82M | – | – |
| Income (loss) before income taxes, Q3 2026GAAP | $30.8M | – | – |
| Income tax benefit (provision), Q3 2026GAAP | −$23K | – | – |
| Net income (loss), Q3 2026GAAP | $30.78M | – | – |
| Net income (loss) attributable to non-controlling interests, Q3 2026GAAP | $15.16M | – | – |
| Net income (loss) attributable to controlling interest, Q3 2026GAAP | $15.62M | – | – |
| Cumulative preferred stock dividends, Q3 2026GAAP | $15.17M | – | – |
| Net income (loss) attributable to Class A common stockholders, Q3 2026GAAP | $451K | – | – |
| Net income (loss) per share, basic, Q3 2026GAAP | $0.13 | – | – |
| Net income (loss) per share, diluted, Q3 2026GAAP | $0.07 | – | – |
| Medical margin, Q3 2026non-GAAP | $43.93M | – | – |
| Medical margin PMPM, Q3 2026non-GAAP | $140K | – | – |
| Medical margin excluding payer settlements and prior year development, Q3 2026non-GAAP | $35M | – | – |
| Medical margin PMPM excluding payer settlements and prior year development, Q3 2026non-GAAP | $111 | – | – |
| Adjusted EBITDA (loss), Q3 2026non-GAAP | $20.87M | – | – |
| Adjusted EBITDA (loss) PMPM, Q3 2026non-GAAP | $66K | – | – |
| Adjusted operating expense, Q3 2026non-GAAP | $34.63M | – | – |
| At-risk members, Q3 2026 (approximate, end of period)other | approximately 105,000 members | – | decrease of 9% |
| Total lives under management, Q3 2026 (approximate, including approximately 28,000 lives under management service arrangements)other | approximately 133,500 | – | – |
| Total operating revenue, nine months 2026 (nine months ended Sep 30, 2026)GAAP | $1.17B | – | – |
| Capitated revenue, nine months 2026GAAP | $1.11B | – | – |
| Other revenue, nine months 2026GAAP | $56.93M | – | – |
| Medical expense, nine months 2026GAAP | $982.4M | – | – |
| Medical claims expense (medical margin reconciliation), nine months 2026non-GAAP | −$896.8M | – | – |
| Premium deficiency reserve (operating expense line), nine months 2026GAAP | −$41.32M | – | – |
| Corporate, general and administrative expense, nine months 2026GAAP | $92.44M | – | – |
| Depreciation and amortization, nine months 2026GAAP | $63.16M | – | – |
| Total operating expense, nine months 2026GAAP | $1.10B | – | – |
| Gross profit (loss), nine months 2026GAAP | $186.7M | – | – |
| Operating income (loss), nine months 2026GAAP | $72.44M | – | – |
| Interest expense, net, nine months 2026GAAP | −$29.67M | – | – |
| Mark-to-market of stock warrants and purchased put option, nine months 2026GAAP | −$8.42M | – | – |
| Other income (expense), nine months 2026GAAP | $5.41M | – | – |
| Total other income (expense), nine months 2026GAAP | −$32.68M | – | – |
| Income (loss) before income taxes, nine months 2026GAAP | $39.76M | – | – |
| Income tax benefit (provision), nine months 2026GAAP | $9.71M | – | – |
| Net income (loss), nine months 2026GAAP | $49.47M | – | – |
| Net income (loss) attributable to controlling interest, nine months 2026GAAP | $24.29M | – | – |
| Cumulative preferred stock dividends, nine months 2026GAAP | $24.74M | – | – |
| Net income (loss) attributable to Class A common stockholders, nine months 2026GAAP | −$452K | – | – |
| Net income (loss) per share, basic, nine months 2026GAAP | $(0.13) | – | – |
| Net income (loss) per share, diluted, nine months 2026GAAP | $(0.13) | – | – |
| Medical margin, nine months 2026non-GAAP | $215.4M | – | – |
| Medical margin PMPM, nine months 2026non-GAAP | $226 | – | – |
| Adjusted EBITDA (loss), nine months 2026non-GAAP | $101.1M | – | – |
| Adjusted EBITDA (loss) PMPM, nine months 2026non-GAAP | $106 | – | – |
| Adjusted operating expense, nine months 2026non-GAAP | $90.88M | – | – |
| Net cash used in operating activities, nine months 2026GAAP | −$90.07M | – | – |
| Net change in cash and restricted cash, nine months 2026GAAP | $20.00M | – | – |
Fiscal 2026 (year ending December 31, 2026), revised outlook
- Revenue$1,525 million to $1,600 million
- NoteAt-risk members: 102,000 to 106,000
- NoteMedical margin (non-GAAP): $260 million to $300 million
- NoteMedical margin PMPM (non-GAAP): $210 to $240
- NoteAdjusted EBITDA (non-GAAP): $90 million to $110 million; the filing states the low end was increased to $90 million, raising the midpoint to $100 million
- NoteThe company does not provide quantitative reconciliation of adjusted EBITDA, medical margin or medical margin PMPM guidance to net income (loss), gross profit or gross profit PMPM, and has not provided forward-looking guidance for net income (loss)
Capital returns
- No share repurchases or dividends on common stock are reported in the filing. Cumulative preferred stock dividends were $15,170 thousand in Q3 2026 and $24,740 thousand in the nine months 2026 (no prior-year comparatives printed).
- Nine-month 2026 financing included proceeds from issuance of preferred stock, net of issuance costs, of $56,461 thousand and proceeds from issuance of warrants of $26,781 thousand (cash flow statement).
What drove it
- Company states that total per-member capitated revenue increased 18% from the prior-year quarter, driven by improved network economics, rate progression, and burden of illness performance.
- Company states that Q3 2026 medical margin results include the favorable impact of payer settlements and prior year development recognized in the quarter. Excluding these items, medical margin was $35.0 million, or $111 PMPM.
- Company states that the guidance increase reflects underlying year-to-date performance, as well as the prior-year development and payer settlements recognized in the quarter.
- Company describes at-risk membership decline of 9% as reflecting previously disclosed intentional network and payer rationalization.
- Q3 2026 reported net income of $30,777 thousand compared with a net loss of $(69,461) thousand in Q3 2025. Operating income was $22,980 thousand versus $(44,223) thousand.
- Q3 2026 medical expense was $346,001 thousand versus $369,789 thousand a year earlier, while other revenue rose to $30,053 thousand from $3,698 thousand. The filing does not explain the other revenue increase.
Concerns
- Forward-looking statements cite the ability to continue as a going concern, the potential need to raise additional capital, and the ability to maintain compliance with debt covenants or obtain lender waivers if future operating performance falls below current projections.
- Net cash used in operating activities was $(90,066) thousand for the nine months 2026, compared with $(65,511) thousand a year earlier.
- Q3 2026 results include payer settlements and prior year development that the company identifies as favorable items; medical margin excluding them was $35.0 million versus the reported $43,934 thousand.
- At-risk members were approximately 105,000, down 9% year over year.
- Cumulative preferred stock dividends of $15,170 thousand in Q3 2026 reduced net income attributable to Class A common stockholders to $451 thousand. Diluted EPS of $0.07 is shown on diluted weighted average shares of 6,627 thousand.
- Current portion of long-term debt rose to $84,428 thousand from $45,036 thousand at Dec 31, 2025, while long-term debt, net fell to $37,331 thousand from $228,374 thousand. The filing does not explain the reclassification in the release text.
- Forward-looking statements reference possible non-cash charges for goodwill or other intangible asset impairment if management assumptions change. Intangible assets, net stood at $431,821 thousand at Sep 30, 2026.
What to watch
- Whether medical margin PMPM holds at the $140 reported in Q3 2026 once payer settlements and prior year development are excluded ($111 PMPM in Q3, $226 PMPM nine-month reported).
- Progress against FY2026 guidance: revenue of $1,525 million to $1,600 million and adjusted EBITDA of $90 million to $110 million, against nine-month adjusted EBITDA of $101,077 thousand.
- At-risk membership against the 102,000 to 106,000 full-year range, following the 9% decline to approximately 105,000.
- Operating cash flow trend, given the nine-month use of $(90,066) thousand, and the company's ability to meet debt covenants and address the going concern language in the filing.
- Current debt of $84,428 thousand and the continued use of preferred equity and warrant financing shown in the nine-month cash flow statement.
Balance sheet and cash flow
- Cash at Sep 30, 2026: $43,900 thousand (Dec 31, 2025: $25,012 thousand). Restricted cash: $1,902 thousand (Dec 31, 2025: $795 thousand).
- Total assets at Sep 30, 2026: $669,719 thousand (Dec 31, 2025: $656,641 thousand).
- Total liabilities at Sep 30, 2026: $469,004 thousand (Dec 31, 2025: $796,876 thousand).
- Total stockholders' equity (deficit) at Sep 30, 2026: $110,459 thousand (Dec 31, 2025: $(155,232) thousand). Redeemable non-controlling interest (mezzanine equity): $90,256 thousand (Dec 31, 2025: $14,997 thousand).
- Current portion of long-term debt: $84,428 thousand (Dec 31, 2025: $45,036 thousand). Long-term debt, net: $37,331 thousand (Dec 31, 2025: $228,374 thousand). Short-term debt: $104 thousand (Dec 31, 2025: nil).
- Claims payable: $221,401 thousand (Dec 31, 2025: $287,790 thousand). Premium deficiency reserve liability: $44,792 thousand (Dec 31, 2025: $86,116 thousand).
- Nine-month net cash used in operating activities was $(90,066) thousand versus $(65,511) thousand a year earlier. Net cash provided by financing activities was $110,312 thousand (prior year $59,940 thousand).
- Nine-month cash flow statement shows a noncash reduction of prior period medical expense of $(56,000) thousand in the adjustments to net income (no prior-year comparative printed).
Analysis
P3 reported Q3 2026 total operating revenue of $396,344 thousand, up 15% from $345,253 thousand, with capitated revenue of $366,291 thousand against $341,555 thousand and other revenue of $30,053 thousand against $3,698 thousand. The company attributes the 18% increase in per-member capitated revenue to improved network economics, rate progression, and burden of illness performance. Medical expense fell to $346,001 thousand from $369,789 thousand, and reported gross profit moved to $50,343 thousand from a loss of $(24,536) thousand. Medical margin was $43,934 thousand, or $140 PMPM, against $4,412 thousand or $13 PMPM a year earlier.
The quality of that margin needs care. The company states that the quarter includes favorable payer settlements and prior year development. Excluding these items, medical margin was $35.0 million, or $111 PMPM. The filing also shows a nine-month noncash reduction of prior period medical expense of $(56,000) thousand, and Q3 premium deficiency reserve credits of $(27,950) thousand within operating expense. The filing does not break out the dollar amount of the settlements and prior year development beyond the excluded medical margin figure.
Below the operating line, operating income was $22,980 thousand against $(44,223) thousand, and interest expense, net fell to $(5,042) thousand from $(20,527) thousand. Net income was $30,777 thousand versus a loss of $(69,461) thousand. Net income attributable to Class A common stockholders was only $451 thousand after $15,170 thousand of cumulative preferred dividends, and diluted EPS was $0.07 on 6,627 thousand diluted shares. Corporate G&A rose to $34,275 thousand from $22,390 thousand, a line that moves against the adjusted operating expense figure of $34,629 thousand reported for the quarter.
Adjusted EBITDA was $20,873 thousand, or $66 PMPM, against a loss of $(45,911) thousand, and the nine-month figure was $101,077 thousand. Management raised the low end of FY2026 adjusted EBITDA guidance to $90 million, lifting the midpoint to $100 million, and kept the top of the range at $110 million. Revenue guidance is $1,525 million to $1,600 million and medical margin guidance is $260 million to $300 million. The filing does not state the prior revenue or medical margin ranges, so no change is attributed to them.
Balance sheet and cash flow carry the main caveats. Nine-month net cash used in operating activities was $(90,066) thousand against $(65,511) thousand, funded by $110,312 thousand of financing inflows including $56,461 thousand of preferred stock proceeds and $26,781 thousand of warrant proceeds. Cash rose to $43,900 thousand, and the current portion of long-term debt is $84,428 thousand. Forward-looking statements in the release cite going concern, covenant compliance, and possible goodwill or intangible impairment, and at-risk membership fell 9% to approximately 105,000.
Management, verbatim
This was another strong quarter for P3. The foundation we have built over the past two years is showing up both in the care our patients receive and in the consistency of our results.
Dr. Aric Coffman, CEO, P3 Health Partners
Not in the filing
stated, not guessed- No prior-year or prior-quarter comparative figures are printed for percentage changes on most operating lines (for example capitated revenue, medical expense, corporate G&A, operating income, net income and EPS changes).
- Dollar amount of payer settlements and prior year development recognized in Q3 2026 is not printed; only the resulting medical margin excluding these items ($35.0 million, $111 PMPM) is given.
- Prior-year and prior-quarter figures for balance sheet items are printed only for December 31, 2025, not for prior-year quarter end.
- Prior-year comparatives for nine-month cash flow lines such as the noncash reduction of prior period medical expense and preferred stock proceeds are not printed (the prior-year column is blank or dashed for those lines).
- Prior guidance ranges for FY2026 revenue, medical margin and medical margin PMPM are not provided in the documents, so no revised-versus-prior comparison is possible beyond the company's statement on the adjusted EBITDA low end.
- Gross margin, operating expense and tax rate guidance are not provided; the company guides medical margin (non-GAAP) instead.
- Segment or geographic revenue breakdown is not provided; only capitated revenue and other revenue are presented as revenue sub-lines.
- Reason for the change in current versus long-term debt classification is not explained in the release.
- Share price reaction and analyst consensus expectations are not included in the documents.
Written by an AI language model from the company’s SEC earnings filing (Form 8-K Item 2.02, or Form 6-K for a foreign private issuer). Every figure is checked against the filing text, and a metric the filing does not print, or whose value, prior period and change do not add up, is dropped from the metrics. The model can still misread a table, in the metrics or in the text, so check a number in the filing before you rely on it. Consensus estimates, price targets and share-price reactions are not shown because they are not in the filing. AI-generated research, not investment advice.
Background
P3 Health Partners reported a 15% revenue increase YoY and a swing to net income, while at‑risk membership fell 9% due to network rationalization.
Ticker impact
P3 Health Partners issued its Q3 2026 results and raised full‑year Adjusted EBITDA guidance to a $90‑$110 million range.
likely upward pressure as investors price in higher EBITDA expectations
The updated guidance lifts the midpoint to $100 million, improving profitability expectations and may trigger buying ahead of the earnings call.
Market effects
Better outlook for population‑health management firms could lift peers.
Limited to U.S. healthcare investors.
Modest, confined to the health‑services niche.
Counterpoint
If the guidance raise is already priced in, the stock may face a short‑term pull‑back.
Key entities
- ExecutiveDr. Aric Coffman
CEO of P3 Health Partners who commented on the results.
