Good morning and thank you for joining us. Today, we reported third-quarter results that we believe reflect strong, continued progress against the priorities we laid out at the beginning of the year.

We grew our performance suite business, improved our care margins, and stayed disciplined on operating expenses, all while continuing to innovate at the core of our business. For the quarter, Evolent reported total revenue of $725 million, up 11% versus Q2, and adjusted EBITDA of $34 million, up approximately 22% sequentially.

Our medical expense ratio, or MER, was 93%, compared with 95% in the second quarter. The improvement reflects favorable in-year claims development and contractual adjustments.

Mario will provide more details on those drivers in a few moments. Based on our results through the first nine months and our current view of the fourth quarter, we are reiterating our full-year revenue guidance of $2.6 billion to $2.7 billion and raising our adjusted EBITDA guidance to $130 million to $135 million.

Before turning it over to Mario, I want to talk you through four topics: one, the strength of our customer relationships and the related growth; two, updates from our 2026 performance suite launches; three, how we are both broadening our product footprint and accelerating our AI innovation; and fourth, our balance sheet. Let's start with the initial topic of customer relationships and growth.

As we've discussed on previous calls, renewals and expansions are at the heart of our growth story, and I'd like to share several proof points of that today. First, we renewed our largest surgical management customer contract for an additional four years.

You will recall surgical management is the IPG business we acquired in 2022. We view this as more than a renewal.

It's a long-standing partner committing to a multi-year deal, demonstrating that our model works and that they want us at their side managing musculoskeletal and cardiovascular care for the long run. Second, an existing client signed an agreement to expand their oncology offering covering several additional states and approximately 1 million commercial lives, with go-live expected January 1, 2027.

This is our first expansion with this client, and we believe demonstrates the trust they placed in us, but also something more strategically important. It's significant to note that this expansion will also include member navigation across all existing and new lives, meaning we're not just growing with the client, we are broadening the footprint by adding our member-facing solution.

This is exactly the kind of product breadth expansion that defines our next phase of growth: taking a client under contract with one solution and giving them a reason to trust us with additional solutions. Third, we're expanding our relationship with a national payer in the specialty technology and services product, adding 11 additional states effective November 1, 2026.

These 11 additional states add to our existing footprint of 39, making Evolent this client's nationwide provider across our full suite of oncology specialties. This client now represents approximately 7 million lives, all of which are managed by Evolent.

Alongside that expansion, we rolled out a new cancer care model in partnership with the American Oncology Network, or AON, that aims to reduce the prior authorization burden for providers, designed to improve quality, timeliness, and affordability for patients. This model has been initially rolled out across clinics in eight states, and it's a blueprint for where we believe oncology care is headed, which is less friction, more trust, and better outcomes.

Taken together, we believe these wins tell a consistent story: our customers are not just staying with us, they're asking us to do more for them, which gives us a durable foundation to keep expanding our products and deepening the value we deliver over time. Next, as in quarters past, I want to update you on our 2026 performance suite launches with Aetna and Highmark.

As of Q3, we are now beginning to see favorable claims run-out relative to our initial reserves, contributing to the MER favorability we're seeing this quarter and reflecting our successful implementations. Mario will speak to this in more detail shortly.

On Highmark specifically, we continue to make strong progress since our launch in May, and while it's still early in the partnership, we believe we're ahead of plan with all leading indicators tracking better than budget. Let me now turn to the third update, which is product expansion and innovation.

In terms of our broader strategy, our growth trajectory rests on two pillars that I remain excited about. The first one is continuing to push the boundaries of our core specialty offering, especially in oncology, which remains the largest and most important growth driver for our business, and we believe will represent over 70% of Evolent's 2027 revenue.

Health plans are navigating a specialty in oncology where effective treatment can mean choosing correctly among a wide range and growing range of evidence-based regimens for a single cancer type, which is exactly why we believe the clinical depth we bring matters and why we keep investing in it. As I mentioned earlier, we've expanded the oncology solution as it relates to our member-facing navigation products.

In addition, we're embedding our clinical pathways directly into the EMRs of leading oncology groups in our network. We expect both of those innovations to continue to expand over the coming years.

Our second pillar is AI, which is relevant for all of our specialties: oncology, of course, but even more so in high-volume areas like imaging, musculoskeletal care, and cardiovascular care. I want to spend a moment updating you on our progress and share why we believe we are now the market leader in AI for specialty reviews.

We have been building our foundation in AI for several years, beginning with our acquisition of Machinify Auth, an AI-native utilization management technology, in 2024. We have since integrated and scaled that platform into what we now call Auth Intelligence.

We took that platform from initial test markets to deployment over the past year, and we believe the initial results are incredibly strong. Let me step back and remind you of the purpose of this Auth Intelligence platform.

First, according to medical literature, approximately 20% of care across any given specialty is the wrong or inappropriate care, defined as unnecessary, low-value, or dangerous to the member. It creates costs that increase premiums and copays for members, and more importantly, may risk their health and safety.

At Evolent, we're focused on identifying which 20% of cases are the wrong or inappropriate care and which 80% represent appropriate care. Our Auth Intelligence platform uses our unique clinical pathways and over 15 years of proprietary data to identify, in real time, which is the 20 and which is the 80.

The result of any false positive or false negative means touching cases with manual review that are in the 80 that could have been auto-authorized at low cost to the AI provider, or missing cases that are in the 20 that need more nuanced human intervention. We believe that with Auth Intelligence in place, we're able to correctly identify both the 80 and the 20, improving the process for patients and providers while maintaining the clinical value and clinical safety for our health plan partners.

Because getting this model right requires large amounts of unique data, and because the model will continue to learn in a self-reinforcing loop, we believe this capability provides an important moat for Evolent in the years to come. Over the last several months, Auth Intelligence has moved well beyond pilot phases, and today, where deployed, Auth Intelligence evaluates approximately half of all our prior authorization volume that previously required manual clinical review.

Today, Auth Intelligence is touching approximately 1 million cases per year. We expect that more than 80% of all manual auths, or approximately 2 million cases, to run through our Auth Intelligence platform by the end of 2027.

Importantly, at customers and case types where Auth Intelligence is deployed, we have seen auto-approval rates improve by as much as 20 percentage points while maintaining clinical value. Said another way, we have seen auto-authorization rates jump from 60% to 80% in certain instances.

It's important to note that just a 10% improvement in our auto-authorization rate translates to a reduction in approximately 600,000 manual touches per year, driving meaningful operating cost savings for Evolent. While we share some of those savings back with our clients in various forms, we believe our AI platform will be a source of margin expansion and, given the differentiation of our solution, particularly in its ability to drive efficiency while maintaining clinical value, will also be a driver of market share expansion and revenue growth in the time ahead.

In January, we'll be hosting a national webinar to update our customers on our AI innovations, as well as to discuss an exciting oncology product enhancement. We will be inviting select investors to also attend this product session and we'll be in touch with you about the event details for those who would like to attend.

Finally, on the balance sheet, we have been consistently focused on capital allocation and enhancing financial flexibility. By the end of the year, we are targeting to deploy up to $50 million towards reducing outstanding indebtedness.

This reflects our confidence in the business, the earnings trajectory we've delivered this year, the visibility provided by our renewals and performance suite partnerships, and the cash generation we expect as those partnerships mature. We will retain flexibility in the timing and form of that reduction in debt, which will be subject to market conditions and other factors, and guided by what we believe is in the best interest of our shareholders, which is focused on maintaining strong liquidity to operate and invest in the business.

Mario will discuss our capital allocation priorities in more detail. To conclude, our third-quarter results show continued progress in growing our business, retaining important customer relationships, and improving profitability.

We remain focused on delivering our 2026 commitments and building a strong foundation for the year ahead. With that, let me turn it over to Mario.

Our third-quarter results reflect continued growth in the performance suite and strong MER performance. Total revenue was $725 million, up approximately 11% versus the second quarter.

Adjusted EBITDA was $34.3 million, up approximately 22% sequentially. That sequential earnings improvement is slightly above the midpoint of the $4 million to $7 million increase we outlined on our Q2 2026 call.

Turning to revenue by product type, performance suite revenue was $564 million, up approximately 16% quarter-over-quarter. The increase was primarily due to a full quarter of Highmark revenue and the recognition of contractual adjustments.

Specialty technology and services revenue was $73 million, down approximately 7% sequentially, reflecting a Q2 benefit from reversing a credit for an anticipated Q1 membership decline that did not materialize. Administrative services revenue was $48 million, remaining relatively flat sequentially, as a one-time favorable implementation credit offset the impact of known client attrition.

Cases revenue was approximately $40 million, slightly lower sequentially, reflecting seasonality primarily. Our medical expense ratio for Q3 was 93%, compared with 95% in Q2, reflecting an approximately 220 basis points sequential improvement.

This improvement was due to favorable in-year claims development that came through earlier than expected. The in-year favorable development reflects better-than-expected medical expenses in Q1 following claims run-out completion.

This is separate and distinct from the prior-year development recognized in Q2. As a result, we expect a smaller sequential improvement in MER in Q4, with some of the expected benefit already reflected in Q3, but reiterate our full-year MER of approximately 93%.

On operating expenses, we remain focused on managing both adjusted cost of revenue and adjusted SG&A. Our staffing costs were relatively flat compared to Q2 2026 in both adjusted cost of revenue and adjusted SG&A.

This reflects the efficiencies we continue to work on across our operations as we grow the business. Non-staff expense was slightly higher quarter-over-quarter, largely due to a one-time vendor rebate realized in the second quarter.

We continue to pursue cost improvements while funding the technology investments needed to support the business. We are still expecting adjusted cost of revenue, excluding medical claims, but including medical device costs, plus adjusted SG&A, of approximately $675 million for the year.

Turning to cash and liquidity, we ended the quarter with unrestricted cash of $148 million and net debt of $776 million. In Q3 2026, we generated approximately $26 million in cash flow from operations, and capital expenditures remained consistent at approximately $7 million for the quarter.

Improvement in cash flow from operations was largely due to one-time items that impacted Q2 2026: first, the repayment of the pass-through proceeds of approximately $20 million; and second, our final lease termination payment of approximately $6 million. For the full year, we continue to expect cash flow from operations of $10 million to $20 million after approximately $60 million of annual cash interest expense.

Our operating cash flow forecast is subject to the timing of reconciliation payments we expect to make in late December. We now expect $26 million to $28 million in capital expenditures for the year.

Turning to our full-year outlook, we are reiterating revenue guidance of $2.6 billion to $2.7 billion and raising our adjusted EBITDA guidance to $130 million to $135 million, from $120 million to $135 million previously. For the fourth quarter, we now expect a sequential increase in adjusted EBITDA of approximately $11 million to $16 million, above the $7 million to $15 million step-up we outlined last quarter, due to continued MER upside.

Looking ahead to 2027, our focus remains on translating the scale of our performance suite business into stronger earnings and cash generation. Let me frame the principal drivers as we see them today.

We expect three key tailwinds: first, contract maturation, including a full year of the partnerships launched in 2026 and continued margin improvement as Aetna and Highmark mature; second, incremental membership growth from new and expanded partnerships; and third, significant cost reductions, driven in part by our AI initiatives and the enterprisewide cost review we launched earlier this year. Those tailwinds will be partially offset by three headwinds: first, membership attrition, primarily from Medicaid work requirements and, to a lesser extent, some planned client attrition in administrative services; second, scope adjustments due to client renewals and contract extensions; and third, continued targeted, high-return investments, such as AI, to support growth and efficiency, which carry near-term costs.

As I just mentioned, our AI program is an important part of these investments. We expect AI-related capital expenditures to be higher in 2027 than in 2026.

We expect these initiatives to begin generating returns in late 2027, which will be primarily in the form of cost reductions. We then expect additional returns in 2028 and beyond from lower operating costs and, more importantly, from new product launches.

The combination of improved MER performance and cost reductions from AI in the second half of 2027 continues to give us a high degree of confidence in the outlook we provided on our Q2 2026 call, that the midpoint of 2027 adjusted EBITDA guidance will be $150 million or higher. On revenue, we continue to expect strong growth in 2027, led by performance suite.

The ultimate rate of growth will depend on several factors that are still developing, including the timing of new launches, membership trends in Medicaid and the exchanges, and the outcome of scope adjustments due to contract extensions. We will provide our detailed 2027 guidance, including a specific revenue range, with our fourth-quarter results in February.

We will continue to be disciplined about the business we add, and we are prioritizing margin and cash generation over revenue growth. Finally, let me address our capital structure.

As we discussed last quarter, strengthening the balance sheet is a priority, and we are advancing that work through a combination of earnings growth, improved cash flow conversion, disciplined capital allocation, and the evaluation of capital markets and strategic alternatives. With adjusted EBITDA performance continuing to improve, we will begin taking steps towards deleveraging and refinancing our debt.

As Seth mentioned, by the end of the year, we are targeting to deploy up to $50 million towards reducing outstanding indebtedness. This reflects our confidence in the business, the earnings trajectory we have delivered this year, the visibility provided by our renewals and performance suite partnerships, and the cash generation we expect as those partnerships mature.

Our objective is straightforward: reduce debt and improve financial flexibility while preserving our ability to execute the operating plan. We will provide updates, as appropriate, as this work progresses.

This is part of the broader effort we described last quarter to improve our leverage and maturity profile over the next 12 to 24 months. We remain focused on both sides of that equation: growing earnings and managing the capital structure.

To wrap up, we delivered another quarter of sequential revenue and adjusted EBITDA growth. We have important customer relationships in place and a clear set of operating and balance sheet priorities.

We remain focused on delivering our commitments, improving cash generation, and creating long-term value for our clients and shareholders. With that, operator, please open the call for questions.

Hey, this is Zach on for Matt. Appreciate the detail on 2027, but any details to share on the underlying medical cost trend assumptions you're making for '27 and maybe specifically in oncology?

Thanks.

Matt, broadly speaking we're assuming that our performance around trend continues to improve as the contracts mature as we've talked about in the past. That's more around the general progression for our performance and the contracts' profitability.

We have seen trends sort of stable for this year, had been coming down from last year, it's stabilized, we're basically assuming stability over the next 12 12 months as well.

Thanks for the questions. With respect to the capital structure and the comments you just made, is there anything else to add in terms of mention and strategic alternatives there?

Just curious on that comment. Then with the new win, the national payer, or expanded relationship, in the tech and services area, is there any number of lives associated with that and the timing of that would be helpful?

Hey Richard, Seth. On your first question, obviously looking at anything and everything that would make sense for shareholders, and that's [laughs] always going to be the answer.

There's lots of different things to consider on that front, and we're really committed to making sure that refinancing happens, and there's a lot of ways to skin that cat, to your point. On the second question, going from 39 to 50, in the tech and services, it's a material number of that 7 million that I quoted.

I don't have the exact number off the top of my head, we can follow up with you, but it's a nice number addition to what we had there.

Hi, this is Mitch on for Charles. Can you help us size the revenue opportunity from the announced oncology expansion that goes live January 1st and adds 1 million commercial lives?

Also maybe some more color on how the member navigation economics work there? Thank you.

Yeah. The million-life add is really around the ASO segment, which is a tech and services opportunity.

It's not huge. Think of it like traditional tech and services rates on the million lives.

Navigation is both on those additional lives, but also all the lives we already have with that client. It's also not a huge number, again think of it more like a tech and services type opportunity, but, I think importantly, good contributor on the bottom line and really importantly, good value for the client.

That's all January, and I think Richard, I forgot to answer your other question, which is the one you asked about is already live.

Thank you, and thanks for taking my questions. You announced the expansion to 11 states with who we have to believe is Humana given the national presence.

Given Humana was also expanding its relationship with other oncology value-based care providers, just curious what today's expansion means in terms of the competitive landscape you're seeing, or the potential for Humana moving back to a performance suite arrangement in the future?

Hey Jailendra. Look, I don't want to get into any specific client conversations, but I'll just say generally, we feel really, really good about where we are competitively in oncology.

That in our core offering, we don't feel like we have direct competitors that can do what we do and the way we do it. There are some navigation companies that you referenced, or people who do other things, which we also do those sorts of things.

We think our work and the navigation work actually fit really well together, but they are very different things. Our core offering, I think, is highly defensible, and as you add in AI and some of the things we announced with AON today as a for instance, I think we feel really good about where we are competitively.

I think that's what you see across a lot of the announcements this quarter, last quarter, Jailendra, the previous quarter. We are growing with our clients, and I think we feel fantastic about where we are on the oncology side.

Hey, this is Dustin on the line for Ryan. Thanks for taking our questions.

Not sure if you've had the time to think about this, but since the midterm elections, just wondering if any thoughts on ACA tax credits or Medicaid work requirements have changed substantially. You don't have to speculate here if you haven't had the time to think through that, but just wondering if that's changed anything in your outlook heading into '27.

Thanks.

Was there an election this week? I didn't know.

[laughs] Just kidding. Look, I think let me say a couple things about the election.

This $150 million number that we have out for next year assumes no change in anything, right? Based on the one big beautiful bill continues to get rolled out the way it has been planned to be rolled out, that's our assumption, we're going to plan that way.

I think as you start to consider changes to that, the one big beautiful bill in total was a massive negative impact on Evolent, and that's been incorporated into all of our numbers already. As you consider the possibility of peeling back things on Medicaid work requirements, timing, effect, or the same thing on exchanges, those would have a very significant positive impact.

That's sort of step one to the election in my mind. I think step two, which is getting a little more speculative, but Medicare for All or something like that would have an additional positive impact on the company.

Obviously for Evolent, the news this week was good. I think the impact it could have over time is positive, but right now, we're planning on no change.

That's how we're thinking about next year. The $150 million EBITDA number we have out for next year, again assumes no change in any of that.

Hey team, this is Kevin on for Ryan. Just two quick questions.

You guys said full year MER 93% guide, correct? Then you said sequential improvement in the Q4, my quick math off the top of my head implies roughly 91% in Q4.

Is that directionally correct and what gives you guys the confidence in the step-down in MER there? Is first question.

That directionally correct. Keep in mind that some of the benefit we thought was going to flow through in Q4 is now flowing through Q3, not a huge amount, but some.

A lot of the confidence now is we've had more experience with the new contracts. Particularly the one that launched January 1st, we have a full quarter's worth of run-out, and we also have a few months of the other large contract.

Embedded in Q4, I think you guys all recall, there are a bunch of new business loads, like the explicit margin build-up that go away in that quarter, a big part of the benefit in Q4 there we're going to see is that reserve building basically stops.

Hey, it's Sahil on for Jess. Thanks for taking the question.

I wanted to ask about Aetna. I know they've been in the news a lot this week, but not on that.

Back in September, they announced their building oncology prior auth, drugs, I think radiation, and imaging in one request, which is live in Medicaid today and expanding to MA in the first half of next year. Could you help us think through how that fits with the work you do for them in Florida?

I think since you're on the risk for that spend at being performance suite, would you expect to be part of that bundle there, meaning practices would still submit their requests through you? Is there anything in that that sort of changes how you're thinking about that relationship in 2027?

I know Mario mentioned some scope adjustments next year, just wanted to clarify there. Thanks.

Thanks Sahil. No change for us at Aetna.

The work that you mentioned is in Medicaid, to your point, we're doing work in Medicare. The kind of innovation that we're working on, which includes bundling and a bunch of other things, the AON announcement we did this week, I think will go in that same direction of doing real innovation.

No change in the Florida relationship, and really I don't think any change in our opportunity to continue to do more there, so that's how I think about it.

Hey, thanks for the question. Maybe on Auth Intelligence, you said 10-point auto-authorization improvement removes about 600,000 manual touches a year.

How should we think about the cost per manual review as we translate that into dollars and maybe help us better understand how those economics are shared? Sounds like some is shared with clients, but obviously still a key profit driver for you, would love to unpack that a bit and better understand how you share those savings.

Then as we look ahead, are you baking in contribution to the 2027 outlook from automation or should we think of that more as upside?

Great questions. Let me start with a couple numbers.

Evolent does about 9 million reviews a year, roughly. We have gone live with Auth Intelligence across the products that represent about 6 million of those 9 million.

That's the 10% on that 6 million is the 600,000, just to kind of ground you in numbers. The way I'd think about this is, the main question you have is if you're a health plan and you're trying to do this kind of work, who's the best provider that you can work with?

I, as we laid out in the script, really feel strongly that what we're doing is the leading solution in the market. What we're in the process of doing is where we have an opportunity with a client to put a relationship in place, a new one or extend a different one, we may share some of those economics and those savings on, hey, 600,000 fewer manual touches, that's real savings, millions and millions of dollars of savings of opportunity.

We're going to share some of that back with the client, but we're going to do that as part of a long-term renewal, and that may have a negative impact relative to what we could have had if we kept all of it for a certain period of time, but because it's ramping the way I described, and because I think we have the leading solution, I think we have the chance both to increase our margins on a percentage basis and share value with the client in a way that makes sure that we retain clients and grow market share. That's how I think about it is, and we're thinking about this across a multi-year period, and so that's sort of the way to think about it.

Last thing I would say is that Evolent is a pretty small market share player today. A big part of the opportunity I think you have to think about is growing share with this capability over time, and there's 140-plus million auths a year that happen in the United States, and so we're doing 9 million of them, and our ability to drive that number up a lot is part of this strategy as well.

Then

in '27, I think you guys can expect that we will have additional efficiencies. Some of it will come from some of the AI work, some of it will come from just regular reviews that we've been having this year that we've talked about during the other calls.

That is part of our outlook next year, and we'll have more details in February, but that'll be part of the guidance that we'll give.

Thanks for the follow-up. Mario, I was wondering if you could talk a little bit, I think you said something about evaluating growth opportunities with a focus on margin or something along those lines, or our priority is the margin.

Is that a situation where you might have either a new or existing client that's looking to do a lot of states or something like that, and you decide to essentially just do one state at a time, more elongated rollout, or just looking for commentary on the growth versus the margin that you provided?

That was really to communicate and make sure that everybody understands that we're very focused on growing still, but we're in a very good position of having a lot of contracts that will continue to mature, so that will help drive organic natural growth. It's a great position to be in, because any new business that we sign up, we can be very selective.

We want to make sure that it fits the strategy that we have, our ability to impact the contract, and any upfront investment that we require, we will have to look at very carefully. That was just to indicate we're in a very different place than we were in a year ago.

We're seeing really good results from our new contracts. Could we reinvest some of that into new contracts that will maybe have some upfront costs?

I don't think I would dismiss that, but it was just to say that we feel really good about our margin ramp-up over the next 18 months.

Richard, another example might be, let's say there's a client opportunity that it could be performance suite, it could be T&S, it's a bit of a jump ball in terms of economics, and the client's okay with either, or there's a hybrid in between. Just as we have been over the last two years where we've recontracted our relationships to make sure they have slightly narrower corridors, less downside.

We've just been very disciplined, is the way I'd think about it.

Hi. Congratulations on the good quarter here.

Can you maybe just talk a bit about your thoughts on sort of the midterm results, and if that's going to have any impact on your business with a more Democrat sort of leaning government, specifically the potential benefits that we might see to Medicaid, how are exchange volumes trending relative to expectations? Any color there would be very helpful, especially since you guys are right in Washington and really well-plugged-in, I think.

Thanks David. As mentioned earlier, right now we're assuming with this $150 million '27 EBITDA number that we've put out there, no change to the big beautiful bill, no impact from the election, blah, blah, blah, just status quo.

I think if you look at the one big beautiful bill in total, it had tens and tens of millions of dollars of negative EBITDA impact, if any of that starts to get peeled back, whether it's work requirements, timing, degree by state, exchange subsidies, that goes in the other direction that would be a positive. The other two effects that exist are, if at some point you have a Medicare for All, that would be additional upside or anything like that that would increase membership.

Then the last effect, I think the health plan market has been in a really difficult underwriting cycle now for multiple years, and that's been easing. I think this probably contributes slightly in that direction as well, which I think just helps the overall environment with customers and renewals and all those sorts of things.

Look, it's undoubtedly a positive. We're not factoring that in for next year as I mentioned earlier, and we'll see how it plays out.

Thanks a lot for the time this morning. Look forward to connecting offline with all of you.

Have a good day.