Executive Summary / Key Takeaways

• Strategic Pivot to Evergreen Healthcare: DocGo is undergoing a significant transition, moving away from episodic, migrant-related government contracts to focus on long-term, technology-driven mobile health and medical transportation services for payers, providers, and health systems. This strategic shift aims to build a more stable and profitable business model.
• Differentiated Technology as a Core Moat: The company's proprietary dispatch and communication technology, including its EPIC-integrated platform and AI-powered patient engagement tools, provides a significant competitive advantage by enhancing efficiency, transparency, and the scalability of its last-mile healthcare delivery.
• Robust Growth in Core Segments: Despite a near-term revenue decline due to the migrant program wind-down, DocGo's base medical transportation business is achieving record volumes, and its payer and provider mobile health vertical is experiencing rapid expansion, driven by care gap closure, remote patient monitoring, and primary care initiatives.
• Near-Term Profitability Headwinds, Long-Term Upside: The strategic investments in new business lines and technology, coupled with the winding down of high-revenue, albeit temporary, government contracts, are impacting 2025 adjusted EBITDA. However, management projects an adjusted EBITDA positive run rate by the end of 2026, fueled by base business growth and declining investment rates.
• Strong Liquidity and M&A Potential: DocGo maintains a healthy balance sheet with substantial cash flow from operations, enabling debt repayment and strategic acquisitions like SteadyMD, which significantly expands its virtual care capabilities and geographic footprint.

The Dawn of Proactive Healthcare: DocGo's Vision and Foundation

DocGo Inc. (NASDAQ: DCGO) stands at the forefront of a transformative shift in healthcare delivery, pioneering a model that brings quality medical treatment directly to patients in their homes, workplaces, and other non-traditional settings. Founded in 2015 as Ambulnz, LLC, and evolving into DocGo Inc. through a 2021 business combination, the company has strategically built its capabilities around proprietary dispatch and communication technology, enabling efficient "last-mile" healthcare delivery. This foundational strength positions DocGo to capitalize on the burgeoning at-home healthcare market, projected by CMS to double to an estimated $250 billion by 2031. The company's overarching strategy is a deliberate pivot from high-volume, but often temporary, emergency response and government population health contracts to a more sustainable, evergreen model focused on integrated solutions for payers, providers, and health systems.

DocGo's technological differentiation is a critical competitive moat. Its proprietary platform, which seamlessly integrates with leading Electronic Health Record (EHR) systems like Epic, offers unmatched transparency and efficiency in managing patient transportation and mobile health services. In 2024 alone, this platform calculated over 15 million estimated arrival times for customers, underscoring its operational scale. The company is also at the vanguard of integrating artificial intelligence (AI) into its operations. An AI agent developed by its engineering team has already confirmed over 3,000 appointments and rescheduled another 350, leading to an estimated 10% saving in live operators' time. This innovation enhances patient engagement and streamlines logistical complexities, directly contributing to operational efficiency and cost reduction. The strategic acquisition of SteadyMD in October 2025 further amplifies this technological edge, providing a 50-state virtual clinician workforce and world-class technology for real-time patient-clinician matching. This pairing of last-mile clinical delivery with virtual care is expected to unlock the full potential of telehealth, creating an optimal end-to-end solution that is difficult for competitors to replicate.

Competitive Landscape and Strategic Positioning

DocGo operates in a dynamic healthcare landscape, competing with a mix of large integrated healthcare conglomerates and specialized service providers. Direct competitors include divisions of giants like UnitedHealth Group (Optum), CVS Health , and other emergency medical service providers such as Envision Healthcare (now part of Optum), as well as managed care organizations like Amerigroup (part of Anthem, Inc.).

UnitedHealth Group (UNH), through Optum, offers broad healthcare services, including transportation. While Optum benefits from immense scale and a diversified portfolio, DocGo's specialized focus on on-demand, technology-enabled mobile health and transport allows for greater agility and tailored solutions, particularly in niche or rapidly evolving care settings. CVS Health leverages its extensive retail footprint for health services. DocGo differentiates itself by bringing care directly to the patient's location, rather than relying on a fixed physical presence, which is crucial for reaching underserved populations and closing care gaps. Envision Healthcare specializes in acute emergency services. DocGo, while also providing emergency transport, emphasizes non-emergency and mobile health services, offering a broader, more versatile value proposition that includes preventive and chronic care management. Amerigroup (ELV) focuses on government programs. DocGo's strategy, while historically involved in government contracts, is shifting towards more stable, evergreen municipal opportunities and private payer partnerships, reducing its reliance on potentially unpredictable government funding.

DocGo's competitive advantages, or moats, are primarily its proprietary mobile health platform and its specialized regulatory licenses for emergency services. The mobile health platform fosters customer loyalty through convenient, at-home services, potentially leading to recurring revenue and improved margins. This technology allows DocGo to counter the scale of larger competitors by offering faster deployment and targeted efficiency, enhancing its pricing power and market share in specialized segments. Its regulatory licenses provide access to restricted markets, supporting robust growth and capital efficiency by limiting new entrants.

However, DocGo faces competitive disadvantages, notably its smaller scale compared to industry behemoths. This can lead to higher operational costs, impacting margins and cash flow, and making it more challenging to compete on price with rivals like CVS Health (CVS), which benefit from vast networks and diversified revenue streams. The company also has potential dependencies on specific suppliers for equipment, which could lead to service delays and affect revenue. Despite these challenges, DocGo's strategic focus on cost-saving solutions for payers and providers, leveraging its technology for efficiency and transparency, positions it favorably to capture market share in the growing mobile healthcare sector. The company's high Net Promoter Score (NPS) of 86 in Q1 2025, significantly above the healthcare industry average of 58, underscores strong patient satisfaction and a key differentiator in a competitive market.

Financial Performance and Operational Momentum

DocGo's financial performance in 2025 reflects a period of strategic transition and significant investment. For the three months ended September 30, 2025, the company reported total revenues of $70.81 million, a substantial decrease of 49% from $138.68 million in the same period of 2024. This decline was primarily driven by the "ongoing wind-down of migrant-related services" within the Mobile Health Services segment, which saw revenues fall by 77.2% year-over-year to $20.69 million. For the nine months ended September 30, 2025, total revenues were $247.26 million, down 50.1% from $495.72 million in the prior year.

Despite the overall revenue contraction, DocGo's base businesses demonstrated resilience. Transportation Services revenues increased by 4.4% to $50.12 million in Q3 2025 and by 4.3% to $150.58 million for the nine months, driven by a 2.5% and 2.2% increase in U.S. trip volumes, respectively. The average trip price also saw a slight increase to $411 in Q3 2025. This segment is a strong foundational asset, expected to generate over $200 million in 2025.

Profitability metrics were impacted by the transition. The consolidated cost of revenues as a percentage of revenues increased to 74.4% in Q3 2025 from 64% in Q3 2024, partly due to lower margins from the early-stage care gap closure business and increased insurance costs. Operating expenses rose by $20.30 million, or 51%, in Q3 2025, primarily due to significant non-cash impairment charges totaling $16.70 million. These included an $8.72 million goodwill impairment and an $8.02 million finite-lived intangible asset impairment in the Mobile Health Services segment, triggered by a "sustained reduction of revenue and forecasts." Consequently, DocGo reported a net loss of $29.66 million in Q3 2025 and $54.03 million for the nine months, compared to net income in the prior year periods.

From a liquidity standpoint, DocGo has demonstrated strong cash management. Operating activities provided $44.92 million in cash for the nine months ended September 30, 2025, despite the net loss. This was largely due to a $100.72 million decrease in accounts receivable, reflecting successful collections of older municipal invoices.

The company repaid its entire $30.00 million outstanding balance under its Prior Revolving Facility in August 2025, and subsequently established a new $55.00 million Revolving Facility with no outstanding borrowings as of September 30, 2025.

While total cash and cash equivalents decreased to $77.61 million as of September 30, 2025, from $107.34 million at the beginning of the year, management asserts that existing cash balances and expected future cash flows will be sufficient to meet operating requirements for at least the next twelve months.

Operational achievements in the base business are noteworthy. The payer and provider vertical's care gap closure and transitions of care business more than quadrupled from Q3 2024 to Q3 2025. Patient visits with a major California health plan are projected to grow from 789 in 2023 to over 17,000 in 2026. The Remote Patient Monitoring (RPM) business is operating at an annual run rate of approximately $15 million with a greater than 10% adjusted EBITDA contribution, expected to trend higher in 2026. The acquisition of PTI Health in Q1 2025 added mobile phlebotomy services, on track for over 125,000 blood draws in 2025 and exceeding 200,000 in 2026.

Outlook and Strategic Initiatives

DocGo's forward-looking guidance reflects its strategic pivot and investment phase. For the full year 2025, the company expects revenues in the range of $315 million to $320 million, with approximately $68 million to $70 million from migrant projects and a base revenue of around $250 million. The adjusted EBITDA loss for 2025 is projected between $25 million and $28 million, primarily due to elevated SG&A as a percentage of revenue during this transitional period and ongoing investments.

Looking ahead to 2026, DocGo anticipates revenues in the range of $280 million to $300 million, representing a robust 12% to 20% growth over 2025's base revenues. Crucially, this guidance assumes no migrant-related revenues in 2026. The company projects a full-year adjusted EBITDA loss between $15 million and $5 million, with the "bulk of the expectation for a negative EBITDA number... in the first half of the year," followed by sequential improvements and an "adjusted EBITDA positive run rate" by the end of 2026 at the top end of the revenue guidance. This improvement is expected from higher gross margins, particularly in transportation as staffing ramps up, and continued SG&A reductions.

The strategic initiatives underpinning this outlook are clear. In medical transportation, management aims to improve the adjusted EBITDA contribution margin to approximately 12% over the next two to three years. The company plans to hire 700-800 additional EMS staff to capture an estimated 26,000 trips currently outsourced due to capacity constraints, expecting "millions of dollars of additional top-line revenue on our existing contracts in 2026." The payer and provider vertical is slated for significant growth, projected to reach $85 million in 2026, including an annualized $25 million contribution from the SteadyMD acquisition. A new primary care program with a major health plan, launching in Q4 2025 and ramping in early 2026, will offer services to 10,000 members, a substantial increase from 44 PCP visits in 2024 to a projected 40,000 in 2026. DocGo is also selectively pursuing "evergreen" government opportunities, such as providing care for veterans, to ensure more stable revenue streams.

Risks and Challenges

While DocGo's strategic pivot holds significant promise, investors should be mindful of several key risks. The ongoing wind-down of government contracts, particularly migrant-related projects, has already led to substantial revenue declines and impacted profitability. Although management expects these revenues to be "insignificant" in 2026, the transition period carries inherent financial strain. The company's Q3 2025 financial results included significant non-cash goodwill and intangible asset impairment charges, totaling $16.70 million, reflecting the impact of reduced revenue forecasts in the Mobile Health Services segment. Further impairments could adversely affect financial condition.

Inflationary pressures, particularly on wages, fuel, and medical supplies, have historically compressed gross profit margins, as the company's ability to pass on these costs to customers in the short term is limited. Fluctuations in self-insurance reserves also introduce an element of unpredictability to expenses. Furthermore, DocGo's revenue and accounts receivable concentration with a few major customers presents a risk, as the loss or significant reduction of business from these customers could materially impact financial performance. The inherent uncertainty in municipal budgets and policy changes, as evidenced by the delays in government population health projects, remains a factor to monitor.

Conclusion

DocGo Inc. is at a pivotal juncture, strategically transforming its business model to capture the immense opportunities in the evolving mobile health and medical transportation sectors. The company's commitment to technology-enabled, last-mile healthcare delivery, bolstered by acquisitions like SteadyMD and a focus on evergreen payer and provider partnerships, forms a compelling investment thesis. While the wind-down of legacy government contracts and the necessary investments in new growth areas are creating near-term profitability headwinds, the underlying strength of its base businesses, coupled with a robust pipeline and strong liquidity, positions DocGo for a return to adjusted EBITDA positive performance by the end of 2026.

The company's technological differentiation, high patient satisfaction, and strategic focus on cost-saving solutions for healthcare systems provide a strong competitive foundation. As DocGo continues to scale its operations, particularly in care gap closure, remote patient monitoring, and primary care, it is poised to become a critical player in delivering proactive, accessible healthcare. Investors should closely monitor the execution of its growth initiatives, the successful integration of new acquisitions, and the continued realization of operational efficiencies as DocGo strives to fulfill its vision of bringing the doctor's office to every living room.