Evolent Health, Inc. (NYSE:EVH) Q3 2023 Earnings Conference Call November 2, 2023 5:00 PM ET

Company Participants

Seth Frank - Vice President, Investor Relations

Seth Blackley - Chief Executive Officer, Co-Founder & Board Member

John Johnson - Chief Financial Officer

Conference Call Participants

Ryan Daniels - William Blair

Kevin Caliendo - UBS

Unknown speaker - Guggenheim Partners

Charles Rhyee - TD Cowen

Jeff Garro - Stephens Inc

Richard Close - Canaccord Genuity

David Larsen - BTIG

Sean Dodge - RBC Capital Markets

Jessica Tassan - Piper Sandler

Operator

Welcome to the Evolent Earnings Conference Call for the quarter ended September 30th, 2023. As a reminder, this conference call is being recorded. Your hosts for the call today from Evolent are Seth Blackley, chief executive officer; and John Johnson, chief financial officer. This call will be archived and available later this evening and for the next week via the webcast on the company's website, in the section entitled Investor Relations.

I will now hand the call to Seth Frank, Evolent's vice president of investor relations. Please go ahead.

Seth Frank

Thank you, and good evening. This conference call will contain forward-looking statements under the U.S. federal laws. These statements are subject to risks and uncertainties that could cause actual results to differ materially from historical experience or present expectations.

A description of some of the risks and uncertainties can be found in the company's reports that are filed with the Securities and Exchange Commission, including cautionary statements included in our current and periodic filings. For additional information on the company's results and outlook, please refer to our third-quarter press release issued earlier today. Finally, as a reminder, reconciliations of non-GAAP measures discussed during today's call to the most direct comparable GAAP measures are available in the summary presentation available in the Investor Relations section of our website or in the company's press release issued today and posted on the IR section of the company's website, ir.evolenthealth.com, and Form 8-K filed by the company with the SEC earlier today. And with that, I'll turn the call over to Evolent's CEO, Seth Blackley.

Seth Blackley

Good evening, and thanks for joining us. Tonight, we're announcing another strong quarter of execution against our plan. We exceeded our guidance for profitability, continue to see strong business development and cash flow in the quarter, and are tracking toward our short- and medium-term targets. We believe we have the leading value-based specialty care platform in the market and continue to believe we are set up for continued success. Third-quarter revenue of $511 million represents 44.9% reported growth in the quarter compared to Q3 2022. Our specialty offerings, representing 87% of our total revenue, grew 80% versus the same quarter last year, with the NIA acquisition contributing approximately 24% of that 80% growth. Adjusted EBITDA of $48.7 million exceeded our guidance, driven principally by strength in our maturing performance-based arrangements. Our profitability is also translating to cash flow with cash from operations in the quarter of $60.3 million.