Company says decision from Alabama Supreme Court dampened utilization of ART services.
BY RON SHINKMAN
Progyny’s leadership said the Alabama Supreme Court’s ruling that embryos created by IVF are human beings was largely responsible for its missing first quarter revenue estimates that led to a $1 billion drop in its market capitalization.
Stock in Progyny – a New York City-based firm that provides fertility benefits to employers – dropped about 15% the day after it announced earnings on May 9, from $32.50 a share to $27.53. It has since dipped to $26.67 a share as of the end of trading on May 28. The company’s shares are down nearly 36% from its 2024 high of $41.62 per share on Feb. 12.
Progyny reported net income of $16.9 million on revenue of $278.1 million for the first quarter ending March 31. That compares to net income of $17.7 million on revenue of $258.4 million for the first quarter of 2023.
Although Progyny’s net income was in line with estimates from Wall Street analysts, its revenue for the quarter was more than $11 million short of the consensus number of $289.3 million.
Progyny leadership tied the revenue dip to a decrease in utilization of services for the first quarter. About 0.46% of people offered fertility benefits through Progyny used its services. During the first quarter of 2023 the utilization rate was 0.48%. That means utilization dropped about 4.2% year-over-year.
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“We began to see the ramp in member activity leveling off slightly in March, coinciding with the national conversations about women’s access to reproductive healthcare sparked by the Alabama Supreme Court ruling,” Progyny Chief Executive Officer Pete Anevski told stock analysts during the company’s earnings call.
Anevski added that “the modest dip in activity that we saw across the country was more pronounced in the states [which have] the most restrictive laws for women’s reproductive healthcare, suggesting that a relatively small number of members were proceeding with a greater degree of caution before commencing their fertility journey.” He noted that initial user levels during the second quarter of this year were also lower than the second quarter of 2023.
Nevertheless, Progyny says activity is up. Chief Financial Officer Mark Livingston said during the earnings call with analysts that the number of overall assisted reproductive technology cycles performed during the first quarter totaled 14,800, up 12% from the first quarter of 2023. And the number of insured individuals who have access to Progyny through their health insurance rose to 6.4 million during the quarter, compared to 5.3 million during the same period a year ago.
However, Livingston also cautioned that with its utilization rate essentially remaining unchanged going into April, Progyny projects second quarter 2024 revenue of between $300 million and $310 million. The forecast from Wall Street is on the higher end, at $307.2 million, suggesting another revenue miss for the second quarter was possible.
Livingston said full-year 2024 revenue is now forecast at between $1.23 billion and $1.27 billion. Wall Street forecasts $1.24 billion. The company’s 2023 revenue was just under $1.1 billion.
“Our range assumes that utilization in the second half of the year will be nearer to what we saw in 2022 at the low end and closer to what we saw in 2023 at the high end,” Livingston said.
Progyny has responded by buying back its own shares, including a plan to repurchase $100 million worth of stock announced on May 22.
Accurate IVF Conversion Rates Published
FINALLY. The Data Every Fertility Executive Has Been Asking For. Stop paying consultants tens of thousands of dollars for less accurate information. eIVF has the real numbers, pulled from 130,000+ IVF cycles and 550+ providers. To promote their Fertility Vision Dashboard, they’re giving you this information for free, right now, in one report.
Only this report has accurate figures for:
Avg ART Conversion Rate
Avg IUI Conversion Rate
Avg days from registration to consult
Avg days from consult to ART
Avg days from consult to IUI
Avg new patients
Stop using random estimates. Download this free report to accurately benchmark your providers’ performance using real nationwide averages.
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