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DCGO
Earnings call · Jun 2026 (Q2 FY26)

DocGo Q2 FY26 earnings call DCGO

Aug 17, 2026 Source

Executive summary

DocGo Q2 FY26 — Hicuity Health Acquisition and Strong Organic Growth

DocGo announced the strategic acquisition of Hicuity Health, significantly expanding its virtual care capabilities and strengthening its "Care Anywhere" strategy by integrating hospital-to-home services. The company demonstrated strong organic growth across its core business lines and made substantial progress on AI-driven efficiency initiatives, leading to a sequential improvement in adjusted EBITDA loss. While full-year EBITDA guidance was widened due to slower-than-anticipated cost savings realization and margin pressures, management expects to achieve a positive adjusted EBITDA run rate by year-end.

Highlights

5

  • Signed definitive agreement to acquire Hicuity Health, a virtual care provider with $65 million in TTM revenue and $4.5 million in adjusted EBITDA.

  • Achieved record volumes across key business verticals: U.S. medical transportation up 15% YoY, health care in the home up 26% YoY, mobile phlebotomy up 20% YoY, cardiac and remote patient monitoring up 13% YoY, and virtual care and lab orders up 58% YoY.

  • Non-migrant revenue increased 19% YoY in Q2 2026, with organic growth (excluding migrant and SteadyMD) at 5% YoY.

  • Adjusted EBITDA loss improved by nearly 40% QoQ, declining from $10.3 million to $6.3 million.

  • Implemented AI efficiency initiatives, such as an AI communications tool handling 60% of inbound patient calls and 100% of outbound scheduling, and AI data entry for 65% of orders, expecting $6 million in annual savings.

Concerns

5

  • Adjusted EBITDA loss for Q2 2026 was negative $6.3 million, wider than original expectations for the full year.

  • Full-year adjusted EBITDA loss guidance widened to $17 million to $22 million from $5 million to $10 million previously.

  • Adjusted gross margin declined to 30.5% in Q2 2026 from 31.6% in Q2 2025, impacted by higher field labor wages and increased fuel costs ($4.27/gallon vs $3.16/gallon).

  • SteadyMD gross margins were temporarily lower due to aggressive hiring to meet increased demand.

  • Timing of future collections for migrant-related accounts receivable from New York City's HPD remains unpredictable.

Guidance & targets

CategoryTargetConfidence
Full-year revenue
$305 million to $310 million
high materiality
High
Full-year adjusted EBITDA loss
$17 million to $22 million
high materiality
Medium
Adjusted EBITDA run rate
positive
high materiality
High

Segment performance

SegmentRevenueYoYQoQMargin
Medical Transportation
Revenue increased from $49.6 million in Q2 2025, driven by gains in large and small U.S. markets like New York, Texas, and Tennessee. Adjusted gross margin was 31.1% in Q2 2025. Margins were restrained by higher effective hourly wages for field labor, but overtime rate declined to its lowest level since Q2 2024. Fuel costs impacted gross margins by about 60 bps YoY.
Overtime rate: 8.1% (Q2 2026)Fuel cost per gallon: $4.27 (Q2 2026)
$52 million5%slightly surpassing Q1's transport revenues32%
Mobile Health
Revenue declined from $30.8 million in Q2 2025, primarily due to the wind-down of migrant-related projects. Non-migrant mobile health revenues surged by 78% YoY, driven by increases in care gap closures, remote patient monitoring, mobile phlebotomy, and SteadyMD. Adjusted gross margin was 32.5% in Q2 2025. SteadyMD gross margins were temporarily lower due to aggressive hiring. Underlying gross margins from continuing business lines improved by over 500 bps, as high-margin services like RPM and mobile phlebotomy accounted for a greater proportion of revenues. Migrant-related projects in Q2 2025 had 37.1% gross margin.
$21.4 million-30.4%—27%

Deals & partnerships

Hicuity Health Acquisition of a leading provider of acute and critical care telemedicine services. Assumed $52 million existing debt; 2% equity interest (with potential additional 3.5% if market cap reaches $250M within 3 years)

DocGo will acquire 100% of Hicuity on a cash-free basis, assuming existing indebtedness held by Perceptive Advisors. Perceptive also committed up to an additional $50 million in financing to DocGo.

Perceptive Advisors Commitment for additional financing to DocGo. Up to $50 million

In addition to assuming Hicuity's existing debt, Perceptive Advisors committed up to $50 million in multiple tranches. The first $12.5 million will be funded with a services agreement for pre-closing management services to Hicuity.

one of the largest national health plans New contract to offer services to members in Pennsylvania.

New contract signed to offer services to members in Pennsylvania.

Risks & headwinds

Adjusted EBITDA loss wider than anticipated Full year 2026

Full year guidance widened to $17 million to $22 million loss from $5 million to $10 million loss

Mitigation:Cost cuts took more time than anticipated to impact financials; expecting continued sequential declines in SG&A and improved gross margins in H2 2026.

Gross margin lower than anticipated Q2 2026

30.5% in Q2 2026 vs 31.6% in Q2 2025; Medical Transportation gross margins impacted by higher field labor wages and fuel costs ($4.27/gallon vs $3.16/gallon, 60 bps impact on transport, 40 bps on consolidated); SteadyMD gross margins temporarily lower due to aggressive hiring.

Mitigation:Increased field headcount to reduce overtime, expecting SteadyMD margins to normalize later in 2026, and high-margin mobile health services contributing more.

Timing of migrant-related accounts receivable collections remains unpredictable Ongoing

Received $8 million from NYC HPD on April 1, 2026; remainder still pending.

Mitigation:Working on collecting the remainder; Hicuity transaction and Perceptive financing provide balance sheet flexibility.

Potential CMS changes to RPM reimbursement rates 2027

Affects approximately 2,000 patients in RPM programs

Mitigation:Focus on chronic care management (CCM) and transitional care management (TCM) which are not under discussion; vast majority (55,000) of monitored patients are cardiac device patients, unaffected.

What to watch in Q3 FY26

Adjusted EBITDA run rate

Exit 2026 (Q4 FY26)
Current Negative $6.3 million (Q2 2026 loss)
Target Positive run rate

Why it matters

Achieving positive adjusted EBITDA run rate is a key financial milestone for the company's profitability and future outlook.

That being said, we believe that the company will achieve a positive adjusted EBITDA run rate as we exit the year and be set up for a very strong 2027.

Q&A highlights

Inquired about customer overlap, cross-sell opportunities, Hicuity's growth rate, and potential closing hurdles for the Hicuity acquisition.

Lee Bienstock highlighted significant customer overlap with hospital systems, enabling cross-selling of virtual and in-person care services, especially for transitional care management. He noted Hicuity's TTM revenue of $65 million and an estimated low double-digit growth rate (10-12%). Norm Rosenberg added that closing hurdles are minimal, primarily state regulatory approvals and minor customer consents, none of which are expected to be problematic.

“Combining Hicuity strength in providing care and health system settings with DocGo's technology-enabled mobile model that delivers care in the home, it differentiates our offering far beyond a single point solution on the patient journey and positions DocGo to support patients across the entire care continuum from the hospital to the home.”

asked by Ryan MacDonald · answered by Lee Bienstock

2 min read 5 chapters

Detailed narrative

Strategic Acquisition of Hicuity Health

DocGo signed a definitive agreement to acquire Hicuity Health, a leading virtual care provider specializing in acute and critical care telemedicine. This acquisition, DocGo's second major virtual care acquisition in nine months, brings approximately $65 million in trailing 12-month revenue and $4.5 million in adjusted EBITDA. The integration aims to combine Hicuity's strength in health system settings with DocGo's mobile model, creating a unified platform for care delivery from hospital to home, expanding cross-selling opportunities, and leveraging proprietary technology for optimized clinical resource allocation.

Funding and Transaction Details

The Hicuity acquisition involves assuming approximately $52 million in existing debt, maturing in December 2029, and a commitment for an additional $50 million in financing from Perceptive Advisors. DocGo will issue new equity representing 2% of its fully diluted common stock to Hicuity's preferred equity holder, with a potential additional 3.5% if DocGo achieves a $250 million market capitalization within three years. These strategic relationships are expected to create additional value for DocGo in the months and years ahead.

Operational Efficiencies and AI Integration

DocGo is actively pursuing efficiency initiatives, including a corporate reduction in force that reduced annual SG&A by approximately $4.5 million. AI-driven tools are significantly impacting operations, such as an AI communications tool handling 60% of inbound patient calls and 100% of outbound scheduling for mobile phlebotomy, and AI data entry processing 65% of orders. These initiatives are expected to generate approximately $6 million in annual savings upon full implementation, with more programs planned for late 2026 and early 2027.

Focus on Chronic Care Management and RPM

Management clarified its approach to remote patient monitoring (RPM), emphasizing that its programs are primarily focused on chronic care management (CCM) and transitional care management (TCM), rather than mere data monitoring. While approximately 2,000 patients are in RPM programs that could be affected by potential CMS changes, the vast majority (55,000) are cardiac patients with implantable devices, which are not subject to the same reimbursement discussions. DocGo believes its clinical practice model, which actively manages chronic conditions, aligns with future industry incentives.

Balance Sheet and Liquidity

DocGo's cash and cash equivalents, including restricted cash and investments, stood at $48.1 million as of June 30, 2026, down from $59.9 million at March 31, 2026. Available cash was $25.2 million. The Hicuity transaction, particularly the term loan commitment from Perceptive, is expected to immediately reshape the balance sheet and provide necessary flexibility for growth, replacing the existing asset-backed line of credit. The company continues efforts to collect remaining migrant-related accounts receivable.

AI-generated summary of the company's earnings call. Not investment advice.