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Introduction & Market Context
Privia Health Group Inc (NASDAQ:PRVA) delivered a strong start to 2025, reporting double-digit growth across key metrics in its first quarter results presentation on May 8, 2025. The healthcare company, which is building one of the largest primary care-centric delivery networks in the United States, demonstrated continued momentum following its robust performance in 2024.
Shares of Privia Health have been trading positively, with the stock up 2.64% to $23.32 in the most recent session. In premarket trading, the stock added another 0.64% to reach $23.47, reflecting investor confidence in the company’s growth trajectory and strategic initiatives.
Quarterly Performance Highlights
Privia Health reported impressive year-over-year growth in the first quarter of 2025, with implemented providers increasing 11.7% to 4,871, compared to 4,359 in Q1 2024. Practice collections grew 12.8% to $798.6 million, while care margin rose 10.9% to $105.3 million.
The company’s profitability metrics showed even stronger improvement, with platform contribution increasing 15.6% to $51.7 million and adjusted EBITDA surging 35.1% to $26.9 million. Notably, adjusted EBITDA margin expanded by 460 basis points to reach 25.6%, demonstrating significant operational leverage.
As shown in the following chart of quarterly performance metrics:
Attributed lives also showed healthy growth, increasing 11.1% year-over-year to 1.27 million, with commercial lives growing to 779,000 and government lives reaching 491,000. This diversified patient base provides Privia with stability and multiple avenues for growth.
Strategic Initiatives
A key strategic development in the quarter was Privia Health’s expansion into Arizona, announced on April 9, 2025. The company partnered with IMS, a multi-specialty group with approximately 70 physicians and advanced practice providers across 21 locations in the Phoenix region.
The acquisition brings more than 28,000 value-based care attributed lives across Commercial, Medicare, Medicare Advantage, and Medicaid programs. Privia paid $95 million in cash at closing and expects the Arizona market to become adjusted EBITDA positive by Q4 2025, with meaningful contribution anticipated in fiscal year 2026.
The strategic rationale for the Arizona expansion is illustrated in this slide:
This expansion extends Privia Health’s footprint to 15 states plus Washington D.C., strengthening its position as one of the largest primary care networks in the country. The company now operates across more than 50 specialties with 1,200+ care center locations, serving 5.2+ million patients.
The company’s geographic reach and scale are visualized in the following map:
Value-Based Care Strategy
Privia Health continues to diversify its value-based care platform, which now includes 1.27 million attributed lives across more than 100 value-based contracts. The company maintains a balanced approach to risk, with a mix of upside-only and upside/downside arrangements.
Of the 779,000 commercial lives, 59% are in upside-only arrangements and 41% in upside/downside contracts. Among the 491,000 government lives, the company has 207,000 Medicare Shared Savings Program (MSSP) lives (75% in Enhanced Track with maximum risk), 185,000 Medicare Advantage lives (with varying risk levels including some capitation), and 100,000 Medicaid lives (100% upside-only).
The breakdown of Privia’s value-based care platform is illustrated in this flowchart:
Financial Position
Privia Health maintains a strong balance sheet with $469.3 million in cash and no debt as of March 31, 2025. The slight decrease from the $491 million reported at the end of 2024 reflects annual cash bonuses and physician value-based care payments, consistent with the company’s seasonal patterns. Additionally, $95 million was deployed in April 2025 for the IMS transaction in Arizona.
The company’s solid financial foundation provides flexibility for future strategic investments and market expansions while supporting ongoing operations. Privia Health has demonstrated consistent free cash flow generation, with a historical track record of strong adjusted EBITDA to free cash flow conversion typically exceeding 80%.
Updated 2025 Guidance
Based on strong first-quarter performance, Privia Health raised its fiscal year 2025 guidance to the mid-to-high end of previously announced ranges for most metrics, while maintaining its outlook for attributed lives. This increased confidence reflects the company’s operational momentum and successful execution of strategic initiatives.
The updated guidance compared to FY 2024 actuals and initial FY 2025 guidance is presented in the following table:
The company now expects to end 2025 with 5,200-5,300 implemented providers, representing approximately 10% growth from 2024. Practice collections are projected to reach $3,150-3,250 million, with adjusted EBITDA of $105-110 million, representing continued margin expansion.
Long-Term Performance Trajectory
Privia Health has demonstrated consistent growth and improving profitability over the past seven years. From 2018 to the projected 2025 results, the company has expanded from 4 states to 15, grown implemented providers from 1,796 to an expected 5,275, and increased attributed lives from 575,000 to a projected 1.35 million.
Financial metrics have shown even more dramatic improvement, with practice collections more than tripling from $930 million in 2018 to a projected $3,225 million in 2025. Adjusted EBITDA has grown from just $9 million in 2018 to a projected $108.8 million in 2025, with margins expanding from 6.9% to an expected 24.6% of care margin.
The company’s long-term performance trajectory is illustrated in this comprehensive chart:
Conclusion
Privia Health’s Q1 2025 results demonstrate the company’s continued execution of its growth strategy and operational excellence. With double-digit growth across key metrics, significant margin expansion, and strategic geographic expansion, the company appears well-positioned to deliver on its raised 2025 guidance.
The combination of a strong balance sheet, diversified value-based care platform, and consistent historical performance provides Privia Health with multiple avenues for continued growth. As the healthcare industry continues to evolve toward value-based care models, Privia’s scale and expertise position it to capitalize on these trends while delivering improved outcomes for patients and sustainable returns for shareholders.
Full presentation:
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