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DATE

Thursday, Aug. 6, 2026 at 4:45 p.m. ET

CALL PARTICIPANTS

• Chief Executive Officer - Peter Anevski
• Chief Financial Officer - Mark S. Livingston
• Investor Relations - James Hart

TAKEAWAYS

• Revenue -- $350.5 million, an increase of 5.3% on a reported basis or 11% when excluding a transition agreement with a former client, reflecting growth in the number of clients and covered lives.
• Net Income -- $28.1 million or $0.34 per diluted share, compared to $17.1 million or $0.19 per diluted share in the prior year period, driven by higher operating profit and lower stock-based compensation expense.
• Adjusted EBITDA -- $62.1 million, a 7.2% increase from $57.9 million in the prior year period, as higher gross profit was partially offset by product platform investments.
• Adjusted EBITDA Margin -- 17.7% for the quarter, an expansion from 17.4% in the second quarter of 2025, reflecting improved gross profit efficiencies.
• Gross Margin -- 25.5%, representing an expansion of 180 basis points from 23.7% in the prior year period due to care management delivery efficiencies and lower stock-based compensation expense.
• Fertility Benefit Revenue -- $230.2 million, growing 7.6% over the $213.9 million reported in the second quarter of the previous year.
• Pharmacy Benefit Revenue -- $120.3 million, a 1.2% increase over the prior year as the company absorbed certain cost increases to support clients.
• Client Count -- 604 clients as of June 30, 2026, compared to 542 clients in the second quarter of 2025.
• Average Members -- 7,185,000 members, an increase from 6,743,000 members in the second quarter of 2025.
• ART Cycles -- 16,998 assisted reproductive treatment cycles performed during the quarter, compared to 16,938 cycles in the prior year period.
• Operating Cash Flow -- $50.4 million, which contributed to a total of $201.2 million generated on a trailing 12-month basis.
• Share Repurchases -- 1.2 million shares acquired for $31.5 million during the quarter, with 10.8 million total shares repurchased since November 2025.
• Full Year Revenue Guidance -- $1.36 billion to $1.385 billion, representing projected growth of 5.5% to 7.5% for 2026.
• Full Year Adjusted EBITDA Guidance -- $233 million to $240 million, reflecting expectations for stable margins despite ongoing growth investments.
• Third Quarter Revenue Guidance -- $335 million to $345 million, accounting for a more pronounced seasonal impact during the summer months.
• Working Capital -- $272.9 million as of June 30, 2026, including $236.9 million in cash, cash equivalents, and marketable securities.
• Capital Expenditures -- $6.2 million, a $1 million increase over the prior year reflecting investments in platform expansion and features.
• DSO -- Improved by more than seven days compared to the prior year period, reflecting the typical dynamic as payment flows with new clients are established.
• New Lives Target -- 1 million or more for 2027 launches, with management reporting that early commitments are pacing ahead of the prior year.

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RISKS

• Livingston reported that the third quarter guidance assumes "a slightly more pronounced seasonal impact" on member activity during summer months, which management identified as the primary factor in the projected sequential revenue change.

SUMMARY

Management reported record quarterly revenue and gross profit while maintaining high adjusted EBITDA to operating cash flow conversion. The company noted that current selling season momentum is driven by an acceleration in early commitments and high retention among large accounts. While the third quarter guidance reflects seasonal softness in member engagement, the company confirmed its target to add at least 1 million new lives for the 2027 launch year. Management stated that employers are increasingly focused on cost containment and proven return on investment as medical insurance costs are projected to increase by 10% or more.

• CEO Anevski attributed the sales momentum to employers addressing "a very real and highly prevalent medical need" that can become costly when unmanaged.
• Management indicated that approximately one-third of the current client book is up for renewal, with the "vast majority" of retention risk already mitigated for 2027.
• CFO Livingston stated that the company's investment program, which focuses on platform features and future growth, is expected to "begin to taper down starting in 2027."
• The company has reduced its total shares outstanding by approximately 12.5% through buybacks since November 2025.
• CEO Anevski reported an increase in brownfield opportunities, where employers with existing fertility solutions seek alternatives due to cost concerns and rising medical inflation.
• CEO Anevski noted that the new fully insured market offering, Progyny Select, is expected to become a significant contributor to medium and long-term growth following the initial focus on channel partner development.

INDUSTRY GLOSSARY

• ART Cycles: Assisted Reproductive Treatment cycles, which include IVF with fresh or frozen embryo transfers, embryo banking, and egg freezing.
• Progyny Select: A fully insured benefit offering designed for smaller employers and specific market segments.
• IUI: Intrauterine insemination, a fertility treatment that involves placing sperm directly inside a woman's uterus to facilitate fertilization.
• DSO: Days Sales Outstanding, a measure of the average number of days it takes a company to collect payment after a sale.
• Brownfield: In a benefits context, this refers to employers that already offer a specific type of coverage but are looking to switch providers or plans.
• Greenfield: Employers that are offering a specific type of benefit, such as fertility coverage, for the first time.

Full Conference Call Transcript

Operator: Good day, ladies and gentlemen, and welcome to the Progyny Inc. Second Quarter 26 Earnings Conference Call. At this time, all participants are on a listen-only mode. And the floor will be open for questions and comments after the presentation. If you wish to join the queue at any time to ask a question, you can press star 1 on your telephone keypad. Should you wish to remove yourself from queue, you can press star 2. It is now my pleasure to turn the call over to your host, James Hart. James, the floor is yours.

James Hart: Thank you, Tom, and good afternoon, everyone. Welcome to our second quarter conference call. With me today are Peter Anevski, CEO of Progyny and Mark S. Livingston, CFO. We will begin with some prepared remarks before we open the call for your questions. Before we begin, I would like to remind you that our comments and responses to your questions today reflect management's views as of today only.

We will include statements related to our financial outlook for both the third quarter and full-year 2026 and the assumptions and drivers underlying such guidance, the demand for our solutions, our expectations for our selling season for 2027 launches, anticipated employment levels of our clients in the industries that we serve, the timing of client decisions, our expected utilization rates and mix, the potential benefits of our solution, our ability to acquire new clients and retain and upsell existing clients, our market opportunity, and our business strategy, plans, goals, and expectations concerning our market position, future operations, and other financial and operating information. Are forward looking statements under the federal securities law.

Actual results may differ materially from those contained in or implied by these forward looking statements due to risks and uncertainties associated with our business as well as other important factors. For a discussion of the material risks, uncertainties, assumptions, and other important factors that could impact our actual results please refer to our SEC filings and today's press release. Both of which can be found on our Investor Relations website. Any forward looking statements that we make on this call are based on assumptions as of today, and we undertake no obligation to update these statements as a result of new information or future events.

During the call, we will also refer to non GAAP financial measures such as adjusted EBITDA. More information about these non GAAP financial measures including reconciliations with the most comparable GAAP measures, are available in the press release, which is available at investors.progeny.com. I would now like to turn the call over to Peter.

Peter Anevski: Thanks, James, and thanks everyone for joining us this afternoon. We are pleased to report a strong second quarter highlighted by solid growth over the prior year period. Resulting in record quarterly revenue, gross profit, and adjusted EBITDA. As well as further gross margin expansion and the continued generation of significant cash flow. Fueled by the strength and consistency of this performance, not just in the most recent quarter, but really over the past several years, We have created flexibility. Both to invest in the business by laying a foundation for future growth through the expansion of our platform while also returning value to shareholders through significant share repurchases.

Mark will take you through the details of both that and the quarterly and the quarter shortly. But before that, I would like to give you some color on how our latest sales season is progressing. Because as you know, new sales in any year have the largest impact on our growth trajectory. I am pleased to report our momentum from last quarter has continued. And we enter our most critical time of year for closing new clients in a favorable position. Strong momentum is driven by an acceleration in both early commitments for new sales as well as retention across our existing book of business. Led by our largest clients.

Which has largely derisked client turnover for 2027 and positioned us for another year of strong retention. In short, we are seeing meaningful momentum in the market, and I think it would be useful to help you understand why we believe our solutions continue to resonate so strongly with employers. Starts with the reality that family building and women's health solutions continue to be a priority for employers of all sizes and across all industries. We are addressing a very real and highly prevalent medical need and 1 that can be costly to employers when it is not managed well or not managed at all.

Employers are also experiencing high cost trends in their traditional medical and pharmacy coverage with increases of 10% or more projecting further increases next year. In response, they are turning to solutions and benefit managers with a proven record of not only controlling trend, but helping to bend that curve. The buying criteria for employers evaluating options in the market continues to hone in on cost quality, and member satisfaction with a heightened focus on accountability within each area. They wanna see a track record in achieving total cost and quality management. With a high quality member experience consistently.

And success is measured on the strength of hard ROI savings back to the employer and members yielding short and long term trend control. While the competitive environment remains active, as we look across the landscape, we see the other solutions falling short in 1 or many of these categories. By contrast, Progyny, on the strength of our detailed transparent reporting, remains the only solution in our opinion that has consistently demonstrated the ability to deliver across every 1 of them. And we have done this over a prolonged period giving buyers confidence that we have the right solution that has been proven to work over the longest period of time.

This is why we feel uniquely well positioned to compete and win. Whether it is a buyer with an existing solution or 1 who is adding coverage for the first time. The result of this enhanced focus from employers has us well positioned across our 3 areas for growth, adding new logos, maintaining high client retention, and expanding new partners to enhance our position and extend our reach. Looking a bit deeper within each area, our new client acquisition, early commitments are pacing meaningfully ahead of this time last year. While the sales season will not conclude until November, we have seen a meaningful number of early decisions. More than we would expect at this point in the year.

On that strength, we are confident we will meet our annual target of adding 1 million or more new lives. On client retention, based on current conversations and commitments, we believe we have removed the vast majority of retention risk which is also earlier than usual at this point in the think it is not a coincidence that employers have been able to come to their decisions earlier this year and have chosen Progyny at the point when managing their escalating medical cost trend is a top priority. The winds thus far represent the typical diverse cross section of the economy including employers in energy, construction, manufacturing, aerospace, health care, labor, financial services, and education.

This includes 1 of the oldest and most prestigious universities in the country. Their early commitments have also been diverse in terms of size, spanning from 1 thousand covered lives to the jumbos we see every year. Turning to retention in any season, roughly 1-third of the book is up for renewal. As discussed last quarter, when we described the comprehensive review 1 of our longest standing clients had recently done to measure and validate the efficacy of our program over many years. Existing clients are often in the strongest position to directly see the cost control and sustained savings our solutions deliver.

That not only yields positive renewal activity, but also an opportunity for expansions, which is when a client adds more services with us beyond core fertility, and we take that business away from the competitors who have been previously providing some of those services. For those same reasons, our newest clients are selecting the typical level of coverage that we have historically seen, and we are not seeing existing clients look to reduce their benefit with us for the next year either. Lastly, we are satisfied with our momentum at this point in the year amongst our traditional self insured employers.

We are also pleased with the progress we are making across a number of other strategic areas including health plan partnerships, public sector clients, and continuing to advance our new fully insured market offering called Progyny Select. Seeing good results with our existing partnerships as well as a strong increase in productivity from our health plan partnerships, many of which are now in their second year with us. Additionally, we are pleased with our pipeline of potential new health plan partnerships. We also continue to advance Progyny Select with a focus on building relationships across key distribution areas, like leading general agents, and brokers who are focused on the fully insured market.

These partnerships are an important step, and no different from other relationships we built and curated. We expect the first year will focus largely on forging those channel partners. Versus driving meaningful new volume. As we have said previously, we are not expecting Select to be a meaningful contributor in 2027. And instead view this as an important addition to the portfolio and a significant contributor to our medium and longer term growth. To conclude, we are pleased with our strong performance over the first half of the year. And given the momentum we are seeing in the market, we are comfortable that we positioned ourselves exceptionally well to meet our traditional target of adding 1 million or more lives.

Let me turn the call now over to Mark.

Mark S. Livingston: Thank you, Peter, and good afternoon, everyone. Before I begin, please note that the 8-Ks we filed a short while ago includes our customary slide presentation. Summarizing the results in the quarter while also highlighting some of the longer term trends that we believe are important in understanding the health and direction of the business. That material has also been posted on our website. Rather than repeating what those slides address, my remarks today will focus on the 4 key themes that impacted both the quarter and how we think about the rest of 2026 and beyond. So let's begin with the first theme.

Over the first half of the year, member engagement has remained consistent with our long established ranges. As it relates to the second quarter specifically, engagement was closer to the higher end of expectations reflected in our May guidance. We believe both data points demonstrate how members are continuing to pursue the care and services they need and when the time is right for them to do so. Likewise, second quarter revenue was also closer to the higher end of our guidance reflecting a 5.3% increase on a reported basis and 11% when you exclude the contribution from a large former client who is under a transition of care agreement in the second quarter of 25.

I will remind you that the transition agreement pertaining to this client ended on June 30. Accordingly, the second quarter is the last quarterly period where you have to take that client's contribution into account when looking at our comparative results. Moving on to our second theme, we continue to maintain healthy margins. Even as we continue to invest to expand our product platform enhance features for our members, and also lay the foundation to support our future growth. Gross margin expanded 180 basis points from the second quarter last year, comparable to the level of expansion we also saw in the first quarter.

This is due to the efficiencies we have continued to realize in our care management and service delivery as well as a reduction in stock compensation expense. Adjusted EBITDA margin also expanded from the year ago period though at a lesser rate than we have seen with gross margin as the platform investments we are making are more concentrated within our operating expense lines. Nonetheless, we are pleased with our ability to consistently maintain a level of overall profitability. As measured on a 12-month basis--trailing 12-month basis, adjusted EBITDA margin was 17.2% consistent with where it is trended throughout this period of increased investment. Demonstrating our ability to invest to grow while simultaneously creating efficiencies throughout the business.

As it relates to those investments, second quarter CapEx was $6.2 million This was in line with our first quarter spend as well as $1 million increase over the prior year period. Although it is premature to offer detailed commentary beyond this year, we continue to expect that this investment program will begin to taper down starting in 2027. Turning now to the third theme, Through the ongoing disciplined and prudent management of the business, we have continued to achieve a high conversion of adjusted EBITDA to operating cash flow. This allowed us to once again meet and somewhat exceed our 75% conversion target both in the second quarter and over the first half of the year.

For the fourth time in the last 5 quarters, we generated more than $50 million in operating cash flow. This yielded $201 million on a trailing 12 month basis and we have now exceeded $200 million in last trailing--sorry, last trailing 12 months operating cash flow for 6 consecutive quarters. Through our ongoing focus on managing the revenue to cash process, we drove further improvements in our DSOs, which ended the second quarter more than 7 days lower from where it was in the year ago period. DSO also improved on a sequential basis from March 31 this year, reflecting the typical dynamic we see as the payment flows with our newest clients get up and running.

As of June 30, we had approximately $273 million in total working capital, which includes $237 million in cash, cash equivalents, and marketable securities. There were no borrowings against our $200 million revolving credit facility, and no debt of any kind, and we have no planned use for the facility at this time. And finally, our fourth theme is how our strong and consistent financial performance has provided us with the flexibility to both invest in the business while simultaneously returning value to our shareholders through ongoing share repurchases. In late May, we announced our latest share repurchase program through a $200 million authorization which permits us to acquire shares via open market purchases as well as under structured plans.

Under this latest program, which was in effect for a little over a month during the second quarter, we purchased nearly 1.2 million shares by June 30, for $31.5 million. Including the activity that is happened subsequent to June 30, we have now purchased a cumulative 2 million shares to date under the most recent program and approximately $142.5 million remains available under the existing authorization. On an aggregate basis, combining this current program as well as our prior $200 million program, which concluded earlier this year, have now purchased an aggregate 10.8 million shares overall since November. This has reduced our overall shares outstanding by approximately 12.5%.

Turning now to our expectations for the third quarter and the remainder of 2026. As the third quarter begins, encompassing the peak of the summer as seasonally a less active time for members, we have seen a slightly more pronounced seasonal impact and have reflected that in our third quarter guidance. We view this to be the ordinary rhythm of activity and not an indication of a new macro trend or a change in the overall trajectory of engagement. Although our view into September is inherently limited at this point, we are not seeing this seasonality extend beyond the summer.

Accordingly, we continue to expect that our engagement metrics for the full year will remain consistent with our long established historical ranges with the low end of our range consistent with our 5-year low for annual utilization. The table at the back of today's press release outlines our assumptions at both ends of the full year guidance ranges. On the basis of these assumptions, we are projecting revenue in 2026 of between $1.36 billion to $1.385 billion reflecting growth of between 5.5% to 7.5%.

If we exclude the $48.5 million in revenue from the client who was under a transition of care agreement over the first half of 25, our full year revenue growth is projected to be between 9.7% to 11.7%. With respect to profitability, we expect a $233 million to $240 million in adjusted EBITDA, with net income of $104.8 million to $109.9 million This equates to $1.26 and $1.32 in earnings per diluted share and $2.04 and $2.10 of adjusted EPS on the basis of approximately 83 million fully diluted shares. As it relates to the third quarter, we expect between $335 million to $345 million in revenue, reflecting growth of 6.9% to 10.1%.

With the sequential change in second quarter revenue, reflecting the slightly more pronounced seasonality and activity this year. On profitability, we expect between $56 million to $59 million in adjusted EBITDA in the quarter along with net income of between $24.5 million to $26.7 million This equates to $0.30 and $0.33 of earnings per diluted share or $0.50 and $0.52 of adjusted EPS on the basis of approximately 82 million fully diluted shares. At the midpoints of the ranges for both the quarter and the year, you can see we expect to maintain a consistent EBITDA adjusted EBITDA margin even with the investment to grow the business. And with that, we would like to open the call for questions.

Operator, can you please provide the instructions?

Operator: Certainly. The floor is now open for questions. If you wish to join the queue to ask a question at this time, We do ask if listening on speakerphone today that you pick up your handset while asking your question to provide optimal sound quality. Once again, please press *1 on your keypad at this time if you wish to join queue. Please hold a moment while we poll for questions. And our first question today is coming from Brian Tanquilut from Jefferies. Brian, your line is live. Please go ahead.

Brian Tanquilut: Thank you. Good afternoon, guys. Maybe just on the comments on AR cycle seasonality. Just curious if you can expand further on that slowdown that you are seeing this summer and you know, if you have any thoughts on what drove this increased seasonality, and when do you think this peaks and when do we get back to more normal trends?

Mark S. Livingston: So I think what is important, Brian, is to also look at, you know, what we have done here for the first half of the year. Although, we have had a good strong Q1 and Q2, we have not hit the high end of our ranges. And so of what we are doing here is recalibrating and narrowing the year just in recognition of where we are at here. 6 months in. As far as the third quarter, the, you know, comments around that slightly, you know, more pronounced seasonality, it is really limited to just this middle part of the summer here. And we do have some visibility, as we get into September as the appointment scheduling builds there.

So, look, we do not see it as anything that is you know, prolonged or, you know, any kind of change in trend. And so our guidance reflects, you know, really more of a stable utilization and consumption pattern consistent with what we have seen in other years.

Brian Tanquilut: Got it. And then when I think about the sequential improvement in fertility revs, per cycle, what is driving that? Is that ancillary? So then maybe another part of that question would just be any comment you can share on pricing both on the PBM side and on the services side?

Mark S. Livingston: Yeah. So on the you know, on fertility pricing, we do have the ability to modestly increase pricing based on CPI. So on the fertility side, that is something that we have done over the last couple of years. So that contributes, but we are talking, you know, low single digit percentages. And then, you know, on the on the pharmacy side, we have looked to absorb some of the cost increases that we see in order to keep our clients whole.

Peter Anevski: I think if you are I think if you are focused on sequential, sequential is impacted by a lower proportion of cycles in the art cycles in the first quarter. And a higher proportion of initial consults. But the average is calculated in terms of revenue per cycle. Second quarter, seasonally has a bump up in cycles in our cycles. Versus the first quarter, and so and a lower proportion of initial consults. that is normal every year. So as you talk about sequential revenue, that per cycle, that is what impact that.

Brian Tanquilut: Got it. Thank you. Thank you.

Operator: Your next question is coming from Jailendra Singh from Truist Securities. Jalendra, your line is live. Please go ahead.

Jailendra Singh: Yeah. Thank you, and thanks for taking my question. So I want to go back to the seasonality point you raised. I know it is only 1 month of data, but given the experience the company has had in the past couple of years back. What additional data points or observations you have which makes you believe this is really more of the seasonal softness you are seeing outside of being a prudent in your guidance approach, anything else you are doing correctly to make sure you do not get caught off guard once you get out of this seasonal week period?

Peter Anevski: Just to answer your first question, in terms of data points, every year we see seasonality. This in the summer, in the middle of the summer. This year is a little bit more pronounced. If you recall, you know, I think 3 or 4 years ago, we saw the same thing and then exiting the quarter, we saw the same thing in terms of engagement returning. To normal levels. Of the visibility we have so far, for September, that appears to be the case for this year as well. And so that is why we added the color and commentary relative to what we are seeing not only this year, but in periods past.

We do see that seasonality, as, you know, more pronounced in this quarter and then and then coming back to normal engagement levels in the balance of the year. it is just a little bit more pronounced this year than normal. Okay.

Jailendra Singh: And then my follow-up, and thanks for all the color on the selling season, Peter. it is good to see you feel good about, meeting or exceeding annual target of 1 million lives. A quick follow-up there. As you look at these type of lives, industries these lives are coming from, expected utilization or number of offerings they might have access to, how do you think about the revenue attached to these lives, do you think it is similar to, this year or better or worse Any color would be helpful.

Peter Anevski: You know, obviously, we are not gonna quantify it, but I think my commentary spoke to not only the commitments, but the contribution from them, which is where is sort of what you are alluding to being you know, meaningfully ahead of last year at this point.

Jailendra Singh: Got it. Thank you. Thank you.

Operator: Your next question is coming from Michael Cherny from Leerink Partners. Michael, your line is live. Please go ahead.

Michael Cherny: Good afternoon, and thanks for taking the question. I started to harp on this same topic, but this is not the first time, obviously, we have seen summer seasonality you will you have alluded to. Maybe a bit more than before. When you think about the visibility you had at this point last quarter, you talked about utilization improving, but, yeah, I guess, how much was this on the foresight given that, again, you are seeing already an uptick in September? Like, as the work you have done over the years to improve your visibility has been significant, like, how did that play out specifically tied to ending the quarter and into the print?

Peter Anevski: The visibility, Mike, has not changed. The algorithms that we use have improved. Which is what you are referring to in terms of the work we have done. But the visibility is still the same. Right? We have visibility, good visibility, into the month ahead and a little less build visibility into the month after that. that is not new. that is generally how far ahead people are scheduling appointments, and then we look at a lot of things underlying that data.

And so you know, and that is what we use when we guide always, and that is what we used last quarter when we reported in May, and that is what we are using now as we report Q2. And what we are seeing, you know, so far exiting the quarter. And then also looking at past history relative to that being normal in terms of normalizing back to normal levels of engagement, you know, for the remainder of the year.

Michael Cherny: Got it. And just 1 more additional question. I mean, cash flow build has been very strong. You obviously have Select going on. You have some of the other ancillary programs. How do you think about the future usage of capital deployment for both internal external investments as you continue to broaden your lead in the market?

Peter Anevski: Well, like I mentioned, in my remarks, the good news is we have strong enough cash flow to continue to invest. We need to, the level of investment will come down as we had mentioned, a couple times on the last couple of calls. Next year and in the future based on what we have planned. Our large investments happened over the last 2 years. And we will finish out in terms of incremental investments. You know, through the end of this year.

But as you as you mentioned, we had to the capital to make decisions whether there are, you know, any opportunities around M&A, whether they are, you know, tuck-ins or otherwise, whether there is you know, additional repurchases that we are gonna do or any other additional investments. You know, we have the cash flow to do all 3.

Operator: Your next question is coming from Sarah James from Cantor Fitzgerald.

Sarah James: Thank you. On the improved algorithm that you were talking about, can you give us an idea of what the slope of level of confidence looks like? So, you how is your confidence in your 2-week out, 4 versus 4 versus 6? What does that look like for you now?

Peter Anevski: Well, given the actual visibility we have, and given that it is a consumption model, right, you know, obviously, any periods further out, inherently are going to have you know, less. But again, the algorithms have improved significantly. They have proven to be pretty predictable. But things like, you know, more pronounced seasonality than you otherwise did not have visibility into can happen. And what we are experiencing. And by the way, I mean, overall, it is a if you look at toward the midpoint, it is a it is a 1% adjustment. So we are not talking about a large adjustment and change in consumption. But either way, it is a, you know, it is a bad question.

Sarah James: And then you mentioned also the growing pipeline of your broker relationships Can you talk about how material that channel is now to your business and where you think it could go over time?

Peter Anevski: Sure. it is not material today. And as I mentioned in my prepared remarks, not expected to be material at all relative to what it is going to contribute in terms of new lives next year. that is consistent with the comments we have been making. That those channel partners will take time both in terms of signing up as we have been successful in doing so far. But more importantly, in getting throughput from them relative to the reality of when their renewals happen, the majority of which are for 1/1, the reality of getting through those organizations because many of them are inherently roll ups to a lot of small companies.

And a little bit more of a grassroots effort in terms of getting the through to all their brokers, etcetera. And so and so it just, it will the relationships we have built so far are positive. And they are inclined to work with us and work with their people to do that. But it-- that is why it is more of a medium to long term strategy. So I would say it is more important to the medium and long term in terms of being additive as opposed to, you know, looking for something for 2027.

Sarah James: Thank you. Thank you.

Operator: Your next question is coming from Scott Schoenhaus from KeyBanc. Scott, your line is live. Please go ahead.

Scott Schoenhaus: Thanks guys for taking my question. Just to drill in a little bit more on the summertime softness here. You know, if I think about it, is there a way to is there anything that is glaringly different than, you know, you expected in terms of a certain cohort. Right? Is it this new cohort that you onboarded from new wins this year that you saw, you know, a less amount of egg retrievals happening into the summer, but now you are starting to see those appointments being booked for those surgeries or you are seeing the medications. Being ordered, now for September into the fall. Was it a regional softness?

Any, like, color on to as to explain to why this was more pronounced this year? Versus other years and, you know, what if you are actually seeing it from a 1 from 1 delay, in a certain population of employees, from a certain employer that delayed an egg retrieval with medication in the summer and now you are seeing that pickup in the fall.

Mark S. Livingston: Yeah. The short answer is that there is not anything pronounced in any 1 of those that you described. We certainly take a look at that to see if there is anything that would be, different than a seasonality event. it is more across the board really, in all those categories that you are describing.

Scott Schoenhaus: Okay. And then on the selling season, the 1 comment that I thought was really interesting was that you are seeing the sort of competitive, you know, customer conversations from people that had previously had, you know, competitors benefit. Maybe can you go dive into more color, Peter, on what exactly they are telling you and why they are coming to you to explore options? Is it ROI? Is it the fact that their employees want a more robust benefit? You know, this is, I think, the first time you have ever commented on something like this, and kind of want to hear what the customers are saying when they are coming to you. Thanks.

Peter Anevski: Sure. it is important to note that the reason only reason why I am calling it out is because it is more than what we have seen in the past. But we are getting all sorts of opportunities from Brownfield and some Greenfield as well. When you do get these opportunities, you do not always get the opportunity to understand everything they are unhappy about. They just simply are out there, and they are just out there in more volume this year. Until you compete for them. So you spend more time talking about your solution and you just infer that something is not right when they are when they are going out to RFP.

Or a lot of them are doing, you know, many times do market checks, but either way. There is not a lot of discussion around sort of what is not working. there is some anecdotal stuff, but I do not wanna comment on the anecdotal stuff as opposed to, you we are hearing sort of, you know, something constant and systemic. But, you know, I think the more insightful commentary is that it is happening and that we are winning a lot of it.

Mark S. Livingston: Yes, Scott, the only thing I maybe I would add to that is Peter's prepared remarks around cost containment and the pressures on employers now, which I think we believe is part of that root cause of why they are coming to us. We obviously have a proven model that helps control, costs and so, you know, we believe that is part of what is driving that is helpful. Thanks.

Scott Schoenhaus: Thanks. Thank you.

Operator: Your next question is coming from Allen Lutz from Bank of America. Alan, your line is live. Please go ahead.

Analyst: Good afternoon, and thanks for taking the questions. 1 for Peter or Mark here. Around--I guess, to follow-up on the selling season piece here. Is there any way to bifurcate between the, engagement you are getting from prospects that are looking at fertility benefits for the first time versus those that are, potential competitive conversions? Would love to get a if anything's changed there with those that currently do not offer a fertility benefit. And then, second, you know, we have talked about this a little bit in the past, but the conversation around GLP ones continues to evolve. Some of the big PBMs are talking about employers just offering that type of benefit less.

If employers are not offering GLP 1 coverage, are you seeing any increased interest in fertility benefits? Just trying to get a sense of to triangulate if any of those things are hitting your prospects or if it is just too early. Thanks.

Peter Anevski: Yeah. I will try and capture, the spirit of all the asks, Alan. The first thing is building on Mark's comment. What we are seeing more of this year is more brownfield than greenfield. Start with that. It is from all competitors, not just the VC backed competitors, but also those that have a carrier solution today. We still view them and always view them as a competitor. Probably the largest competitor is still relative to where others are getting a fertility benefit beyond our VC backed competitors. And that is not surprising given the fact that as we sort of talked about, you know, ending last year and coming into this year, medical cost inflation is real.

A lot of what is driving that is some of what you are alluding to, which is GLP ones. And other sort of, you know, new drugs in the market that are driving higher utilization overall, you know, increase in medical costs. So it is not surprising that it is those that are looking to, you know, contain costs or save money, i.e., in a brownfield situation are the ones that are doing more looking and more committing this year. Versus the greenfield. Right? We are still getting greenfield, but it is more pronounced than the brownfield. And so that is probably the easiest way I could answer, I think, most of what you have.

Well and really specifically the GLP ones, I do not know that I have enough good information to say As a result of companies cutting back on GLP ones, now they feel that they are they are in a in a better position to, you know, sort of buy fertility or not. I think it just there is an overall reality that they are trying to manage costs overall and that, you know, higher utilization from things like GLP ones and therefore are adjusting just to just to keep you know, doing what they can to bend that cost curve a little bit for themselves.

Operator: Thank you. Your next question is coming from Peter Warendorf from Barclays. Peter, your line is live. Please go ahead.

Analyst: Hey. Yes. Thanks for the question. It looks like clients maybe ticked up slightly in the second quarter, but membership was closer to flat. I mean, it is not a huge difference, but I am just curious if you are seeing any impact from the broader employment trends. And maybe a weaker employment environment. And then what you are assuming in guidance over the second half of the year in terms of membership at current clients? Thanks.

Mark S. Livingston: Yeah. So just as a reminder, we typically count only those clients that have a thousand lives or more. We have a number of them that are smaller, but we have always excluded them. We include the lives, but not the counts. So there were a handful of clients that graduated beyond the thousand life level. Obviously, in and of themselves, not gonna drive your overall averages. So and then, you know, as far as lives are, they have been, you know, pretty consistent. That we have seen, you know, some clients go up a little, some go down a little, but it is been relatively stable. And then from a projection standpoint, we are projecting the same.

We have the same level of full year estimate, as we have been maintaining for a couple of couple of quarters now. And so, yeah, we do have a couple of very small clients that are starting here in the second half, not anything meaningful from a revenue contribution or whatnot. So you see a little bit in the coming quarters, but, you know, frankly, it is just more rounding than anything.

Analyst: Great. And then just quickly on the selling season. it is encouraging that you guys reiterated the million target for this year. Just curious how much visibility you guys have into that target for next year at this point. And then maybe what the expectation might be for how many of those lives come from select versus traditional membership. Thanks.

Peter Anevski: Well, I will start by saying our target our target is always that pretty much every year. We do have a pretty nice pipeline build for the next year selling season so far. And also, we expect more pipeline to come in from now going forward, most of which will be carryover pipeline into next year. But there is some pretty good activity particularly from some jumbo opportunities for next year. it is early to comment on whether or not they will or will not get us to a million lines. And so I cannot reiterate sort of you know, the same kind of clarity around achieving that target.

But I can tell you that we are pleased with the overall pipeline build even for next year as well as sit here now. Thanks a lot. And then as it relates to select, as I said in my previous comments, I as soon as we have more clarity into how much and when Select will start to contribute, you know, more meaningfully. We will add that color in our commentary.

But as I said before, most of what is gonna happen now and over the next you know, I will call it 12 to 18 months is gonna be us, you know, signing up those relationships, and then, you know, work working with those companies and these to get to as many of their brokers through, you know, tactics that we both will do. The companies and us, in order to get adoption going. Great.

Analyst: Thank you. Thank you.

Operator: Your next question is coming from John Pinney from Canaccord Genuity. John, your line is live. Please go ahead.

John Pinney: Hi. Yeah. John Pinney on for Close. Thanks for the questions. Good to hear about the selling season. I guess I just right. You provide any commentary about, like, how what gives you the confidence for anyone who has not been signed as of yet at this point? Season that they are that they are their intent is to sign by the end of the year for next year. I guess it is just, like, what gives you the confidence they will not turn into not nows?

Peter Anevski: Yeah. As you might have we have a lot of tracking and tools, and, obviously, then conversations with our Salesforce and our sales leaders, you know, in particular around the larger that are in pipeline. But we track, you know, a lot of activities A lot of our criteria is to what we call pipeline is objective. In terms of sales progression. And it is it is, you know, a combination of the commentary from, our sales teams. The objective data that we have around the sales activity, what they are looking at, buying questions, that kind of thing, and then our past history around that to estimate where we are gonna get to.

John Pinney: Okay. And just as a follow-up there is there any way you can quantify, like, how much the investments that the investments for this year are like factoring into like EBITDA guidance for the year?

Mark S. Livingston: Yeah. We have never, like, quantified it, but, you know, what we have said historically and still the case is that the increase in CapEx that you have seen over from 2024 to 2025 and now sort of equivalent here in 2026, there is about an equivalent amount of OpEx running through the p and l as well.

John Pinney: But related to the investment?

Mark S. Livingston: Related to the investments. Yeah.

John Pinney: Alright. Thank you. Thank you.

Operator: And our final question this afternoon is coming from David Larsen from BTIG. David, your line is live. Please go ahead.

David Larsen: Hi. We spoke recently with a benefits consultant, and he said that of his, you know, 12 or 13 clients that he supports, Progyny, was in about 7 of them, which I was positively surprised to hear. It makes me think that you have somewhat of a dominant, you know, fertility support position in the market. So I guess, what are your thoughts in terms of, like, growing your revenue and what are opportunities there are to in sell additional services into your existing base What products or services may you develop that could drive incremental revenue growth? And then can you also comment on international expansion efforts since you are doing so well in The US?

I mean, it seems like, you know, Europe and the international markets are the next frontier.

Peter Anevski: As it relates to our existing base, we do not we do not own as much market share in the market as what that you know, consultant said. So that is not representative. Nonetheless, we do we are, you know, 1 of the larger providers of the facility and family benefits in the country for sure. As it relates to opportunities with existing clients, it is the stuff we already do. Which is, you know, whether, you know, it is any of the expanded products that we have and or whether it is them expanding the fertility benefit with us. Most clients start with the 2- to 3-cycle benefit. Not everybody starts with egg freezing.

And over time and we have we have shown in the past charts around this. But over time, each sales year cohort generally buys up a little bit more, whether they add more cycles, whether they add egg freezing. Small portion that does not buy pharmacy every year, whether they add that, whether they add any of the expanded products. Or the opportunities to run the existing base. The opportunities for us still as I mentioned in my prepared remarks, is still around adding new logos all the time.

So although others you know although the what we are winning this year is more pronounced in Brownfields, that does not mean there is an significant opportunity out there for Brownfield and Greenfield as indicated by our expectations for the sales year so far. It relates to opportunities, OUS, the OUS opportunity is not the same in terms of financial contribution as it is in The US. it is more of an opportunity around winning multinational companies, in particular, whose parent is in The US.

And having a solution that will address the needs of their global population, that is at least similar in terms of what it is addressing even if it is not the same type of solution due to many limitations like regulatory limitations etcetera, OUS. So it continues to be an opportunity that we invest in, and have invested and we continue to invest in. In order to win as many multinational companies you know, as we continue forward, you know, fueling the overall fertility and family building business that we have today.

David Larsen: Okay. Thanks very much. Congrats on a good quarter.

Operator: Thank you. This does conclude today's question and answer session. I would now like to hand the floor back to James Hart for closing remarks.

James Hart: Thank you, Tom, and, thank you, everyone, for joining us this afternoon. Please feel free to reach out, of course, if you have any follow-up questions. We will also be attending a conference next week, so perhaps we will see some of you there. Otherwise, enjoy the rest of the summer. Thank you.

Operator: This does conclude today's conference call. You may disconnect at this time, and have a wonderful day. Thank you once again for your participation.