The Oncology Institute, Inc. Q1 FY2026 earnings call

Key Highlights - Strong start to 2026 with 41% revenue growth, driven by value-based contracts and pharmacy business. - Pharmacy revenue up 78% due to record Part B fills. - Saved nearly $2 million in Medicare spending via CMS program. - Florida market now profitable, with MLR performing slightly better than planned. - Anticipate expansion of capitation partnerships in Florida, opening 7 new clinics, and launching proprietary provider portal. - AI initiatives on track to save $2 million in operating expenses. - Welcomed new chief legal officer.

Operations - Florida market is profitable, with MLR for 2025 effective contracts in South Florida meeting target. - Anticipate expanding capitation partnerships in 11 additional counties for Medicare Advantage members in Q3, covering ~200,000 MA lives. - Specialty pharmacy had exceptional quarter with 78% y-o-y revenue growth, 19.2% gross margin. - AI initiatives for revenue cycle, prior authorization, and call center on track.

Total revenue for the first quarter was $147.4 million, up 41.2% year-over-year. Patient services revenue was $59.1 million (40.1% of total revenue), with capitated revenue growing 54% year-over-year to $26.9 million and fee-for-service down ~10% despite increasing visit volumes. Specialty pharmacy revenue was $87.5 million (59.4% of total revenue), up 77.6% year-over-year. Gross profit was $23.3 million, with patient services gross profit $5.7 million and specialty pharmacy gross profit $16.8 million. Overall gross margin 15.8%, patient services gross margin 9.7%, specialty pharmacy gross margin 19.2%.

Full-Year 2026 - Reiterated revenue outlook of $630M - $650M, capitated revenue ~$150M, gross profit $97M - $107M, adjusted EBITDA $0 to positive $9M. - Raised free cash flow outlook to positive $5M - $15M. ### Second Quarter - Anticipate adjusted EBITDA in range of loss $1M to positive $1M, reflecting seasonal improvement and ramp of Florida-delegated lives.

Q: Talk about delegated risk arrangements in Florida, MLR performance, and profitability.

A: By start of Q3, network adequate across 25 counties with ~200,000 MA lives in delegated capitation model. MLR for 2025 cohort slightly better than 85% target. Florida market profitable.

Q: Color on dispensary growth, attachment rate, provider education.

A: Attachment rate exceeded expectations, workflow changes driving growth. Provider education through portal and pathway integrations.

Q: Proprietary network portal, cadence of rollout, financial benefits.

A: Anticipated Q3 launch, accessible to 100% non-employed providers in delegated contract network. Could drive Part D fills, but not specifically guided.

Q: 200,000 live target in Florida, bridging difference.

A: Incremental 130,000 MA lives with major carriers.

Q: Color on free cash flow improvement, Florida clinics, specialty pharmacy dispensing.

A: Free cash flow improvement from supplier negotiations. Clinics underway for Florida expansion. Specialty pharmacy focuses on oncology-specific medications.

Q: CMS enhancing oncology model, savings perspective.

A: Savings in periods two and three, episodic total cost of care risk model.

Q: Portal impact on provider actions, cost savings.

A: Portal centralizes utilization management, helps with prior authorizations, drives formulary adherence, and offers access to ancillary services.

Q: AI beyond 2026, additional use cases.

A: Potential use cases in care navigation, far from maximizing savings in initial AI initiatives.