Progyny, Inc. Surpasses Expectations in Earnings Call

Progyny, Inc. ((PGNY)) has held its Q3 earnings call. Read on for the main highlights of the call.

Progyny, Inc. recently held its earnings call, revealing a generally positive sentiment despite a few challenges. The company reported strong performance with revenue and profitability surpassing expectations. A successful selling season and a high client renewal rate further contributed to the positive outlook, although there were some concerns about slightly lower than expected new covered lives and the impact of losing a large client. Overall, the positive aspects significantly outweighed the negatives, indicating strong business momentum.

Revenue and Profitability Exceeded Expectations

Progyny reported a robust third quarter, with revenue and profitability surpassing the high end of guidance ranges. The company achieved a 9% revenue growth on an as-reported basis, boasting a 23% gross margin and a 17.5% adjusted EBITDA margin. This performance underscores Progyny’s strong financial health and operational efficiency.

Full Year Guidance Raised

For the third consecutive quarter, Progyny raised its full-year guidance, increasing the midpoint of revenue guidance by more than $70 million above the original range. This upward revision reflects the company’s confidence in its continued growth and market leadership.

Successful Selling Season

Progyny added over 80 new logos and approximately 900,000 lives, highlighting strong demand for their solutions despite macroeconomic challenges. This successful selling season demonstrates the company’s ability to attract new clients and expand its market presence.

Near 100% Client Renewal Rate

Progyny achieved nearly 100% renewal of existing clients in covered lives for 2026, showcasing strong client retention and satisfaction. This high renewal rate is a testament to the value and effectiveness of Progyny’s offerings.

Strong Cash Flow and Share Repurchase Program

The company generated more than $50 million in operating cash flow this quarter, bringing the total to a record $156 million over the first nine months. Progyny also announced a new share repurchase program for up to $200 million, reflecting its strong financial position and commitment to returning value to shareholders.

Introduction of New Supplemental Plan

Progyny announced a first-of-its-kind supplemental plan for fertility and family building, targeting small and midsized companies. This innovative offering is expected to expand Progyny’s reach and appeal to a broader client base.

Lower Than Expected New Covered Lives

The addition of 900,000 new covered lives was slightly below the 1 million goal, partly due to some employers not accelerating their decision-making process. Despite this shortfall, the overall growth in covered lives remains strong.

Impact of Large Client Loss

Third-quarter revenue growth was negatively impacted by the transition of care agreement ending with a large former client as of June 30, 2025. This loss presents a challenge, but Progyny’s overall growth trajectory remains positive.

Economic Uncertainty and Healthcare Cost Inflation

The sales pipeline built slower than expected, largely due to macroeconomic uncertainty and high macro medical cost inflation. These factors pose challenges, but Progyny continues to navigate the landscape effectively.

Forward-Looking Guidance

Progyny remains optimistic about its growth trajectory into next year and beyond. The company raised its full-year revenue guidance by over $70 million, driven by strong client additions and a near 100% renewal rate. The introduction of a new share repurchase program and innovative offerings like the supplemental plan for fertility and family building are expected to further bolster Progyny’s market position.

In summary, Progyny’s earnings call reflected a strong performance with revenue and profitability exceeding expectations. Despite some challenges, the company’s successful selling season, high client renewal rate, and strategic initiatives position it well for continued growth. Investors and stakeholders can remain confident in Progyny’s ability to navigate the current economic landscape and capitalize on future opportunities.