TOI — The Oncology Institute, Inc.

Summary of The Oncology Institute Q4 2025 Earnings Call

1. Key Financial Results and Metrics

• Revenue: Q4 revenue reached $142 million, a 41.6% increase year-over-year, with full-year revenue at $502.7 million, up approximately 28% from $393.4 million in 2024.
• Adjusted EBITDA: Achieved positive adjusted EBITDA of $147,000 in Q4, marking the first profitable quarter since going public, compared to a loss of $7.8 million in Q4 2024.
• Gross Profit: Q4 gross profit was $22.7 million, with a gross margin of 16%, up from 14.6% in the prior year.
• Cash Position: Ended the year with $33.6 million in cash and positive free cash flow of $3.2 million in Q4.

2. Strategic Updates and Business Highlights

• Capitated Care Model: Continued expansion with 9 new capitated contracts initiated in 2025, adding approximately 260,000 patient lives under management, particularly in California, Florida, and Nevada.
• Pharmacy Growth: The Part D dispensing platform generated nearly $270 million in revenue, contributing close to $50 million in gross profit for the year, driven by increased prescription volumes.
• Operational Efficiency: SG&A expenses decreased by 2% year-over-year, reflecting improved operational efficiency as the company scales.
• Leadership Expansion: Strengthened leadership team with new appointments, enhancing capabilities for scaling operations.

3. Forward Guidance and Outlook

• 2026 Guidance: Revenue expected between $630 million to $650 million, with approximately $150 million from capitated contracts. Adjusted EBITDA is projected to range from $0 million to $9 million, with free cash flow anticipated to be negative $15 million to positive $5 million.
• Capitated Revenue Growth: Expected over 80% growth in capitated revenue for 2026, driven by existing and new contracts.
• Seasonal Variability: Anticipated adjusted EBITDA loss in Q1 2026 due to seasonal factors such as patient deductible resets and annual drug price increases.

4. Bad News, Challenges, or Points of Concern

• Inflation Reduction Act Impact: Minimal expected impact on IMBRUVICA revenue in 2026, but ongoing monitoring of drug pricing and reimbursement dynamics is necessary.
• Market Pressures: Potential for margin pressures in a lower rate environment as demand increases, although TOI believes its unique care model provides competitive advantages.
• Fee-for-Service Growth: Expected flat to low single-digit growth in fee-for-service revenue due to the increasing focus on capitated contracts, which may cannibalize some fee-for-service volumes.

5. Notable Q&A Insights

• Dispensing Revenue Drivers: Strong performance in Q4 driven by operational execution and increased patient encounters linked to capitated contracts.
• Contract Expansion: Plans to double the Elevance contract in Florida and successfully initiated new contracts with Humana and CarePlus, indicating strong market demand.
• AI Efficiencies: Anticipated $2 million in SG&A savings from AI-related efficiencies, particularly in prior authorization processes.
• Market Positioning: TOI's model allows for better control over care delivery and pricing, positioning the company favorably against competitors in a challenging market environment.

Overall, TOI demonstrated significant growth and operational improvements in 2025, achieving its first profitable quarter as a public company while navigating potential market challenges and preparing for continued expansion in 2026.