Astrana Health (3AM) Q3 2026 Earnings Report

The call was strongly positive overall, supported by record revenue and adjusted EBITDA, organic EBITDA growth, strong free cash flow, significant debt reduction, favorable Medicare and Texas performance, Prospect integration progress, and multiple growth initiatives. Management also maintained its full-year outlook and reiterated at least mid-teens medium-term adjusted EBITDA growth. The principal challenges were Medicaid membership attrition and medical cost pressure, expected fourth-quarter seasonality, ACO program transition considerations, the previously disclosed material weakness, and the ongoing cybersecurity investigation. Highlights significantly outweighed the lowlights.

Astrana is maintaining the midpoint of its full year outlook and now expects revenue of $3.9 billion to $4 billion, adjusted EBITDA of $261 million to $274 million, and free cash flow of $107.5 million to $130 million; fourth-quarter revenue is expected between $939 million and $1.04 billion and adjusted EBITDA between $48.5 million and $61.5 million. The company expects full year G&A to remain around approximately 6.2% of revenue, overall medical cost trend to remain around the approximately 5.2% assumption embedded in full year guidance, and to approach 2x net leverage by year end. It expects at least mid teens annual adjusted EBITDA growth over the medium term, approximately 82% of capitation revenue under full risk arrangements by year end, 10 to 15% decline in Medicaid membership in 2027, Medicare Advantage margins to remain stable into 2027, weighted average paid star rating to improve modestly in 2027 versus 2026 and remain relatively stable in 2028, and at least mid to high teens membership growth in its ACO programs going into 2027.