Prepared remarks
Good day, ladies and gentlemen, and welcome to the Progyny Inc. Second Quarter 2026 Earnings Conference Call. At this time, all participants are on a listen-only mode. 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.
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. These are forward-looking statements under the federal securities laws. 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, is available in the press release, which is available at investors.progyny.com. I would now like to turn the call over to Peter.
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 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 de-risked 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. It 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—one 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 and 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 want to see a track record in achieving total cost and quality management with a high-quality member experience consistently. 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 one 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 one 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 one who is adding coverage for the first time. The result of this enhanced focus from employers has us well positioned across our three 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, on 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 one 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 season. I 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 wins 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 one of the oldest and most prestigious universities in the country. Their early commitments have also been diverse in terms of size, spanning from one thousand covered lives to the jumbos we see every year. Turning to retention in any season, roughly one-third of the book is up for renewal. As discussed last quarter, when we described the comprehensive review one 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. We are 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 have positioned ourselves exceptionally well to meet our traditional target of adding one million or more lives. Let me turn the call now over to Mark.
Thank you, Peter, and good afternoon, everyone. Before I begin, please note that the Form 8-K 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 four 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 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 was under a transition of care agreement in the second quarter of 2025. 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 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 trailing 12-month basis, adjusted EBITDA margin was 17.2%, consistent with where it has 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 capital expenditures were $6.2 million. This was in line with our first quarter spend as well as approximately $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 five 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 trailing 12-month operating cash flow for six 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 seven days lower from where it was in the year-ago period. DSO also improved on a sequential basis from March 31 of 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, no debt of any kind, and we have no planned use for the facility at this time. 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 has happened subsequent to June 30, we have now purchased a cumulative two 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, we 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 five-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 2025, our full-year revenue growth is projected to be between 9.7% to 11.7%. With respect to profitability, we expect $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 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?
Questions and answers
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 the queue. Please hold a moment while we poll for questions. Our first question today is coming from Brian Tanquilut from Jefferies. Brian, your line is live. Please go ahead.
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?
So I think what is important, Brian, is to also look at what we have done here for the first half of the year. Although we have had a strong first quarter and second quarter, we have not hit the high end of our ranges. What we are doing here is recalibrating and narrowing the year just in recognition of where we are six months in. As far as the third quarter, the comments around that slightly more pronounced seasonality are really limited to just this middle part of the summer here. We do have some visibility as we get into September as appointment scheduling builds there. So, look, we do not see it as anything that is prolonged or any kind of change in trend, and so our guidance reflects really more of a stable utilization and consumption pattern consistent with what we have seen in other years.
Got it. And then when I think about the sequential improvement in fertility revenue per cycle, what is driving that? Is that ancillary? Another part of that question would be any comment you can share on pricing both on the PBM side and on the services side?
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, which contributes, but we are talking low single-digit percentages. On the pharmacy side, we have looked to absorb some of the cost increases that we see in order to keep our clients whole.
If you are focused on sequential, sequential is impacted by a lower proportion of ART cycles in the first quarter and a higher proportion of initial consults. The average is calculated in terms of revenue per cycle. The second quarter, seasonally, has a bump up in cycles versus the first quarter and a lower proportion of initial consults. That is normal every year. So as you talk about sequential revenue per cycle, that is the impact.
Got it. Thank you.
Your next question is coming from Jailendra Singh from Truist Securities. Jailendra, your line is live. Please go ahead.
Yeah. Thank you, and thanks for taking my question. I want to go back to the seasonality point you raised. I know it is only one month of data, but given the experience the company has had in the past couple of years, what additional data points or observations do you have which make you believe this is really more of the seasonal softness you are seeing versus being overly 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 weak period?
Just to answer your first question in terms of data points, every year we see seasonality in the middle of the summer. This year is a little bit more pronounced. If you recall, three or four years ago, we saw the same thing and then exiting the quarter we saw engagement return to normal levels. Of the visibility we have so far for September, that appears to be the case for this year as well. 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 a bit more pronounced in this quarter 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.
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 the annual target of one million lives. A quick follow-up there: as you look at these types of lives, the 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, better, or worse? Any color would be helpful.
Obviously, we are not going to quantify it, but my commentary spoke to not only the commitments but the contribution from them, which is what you are alluding to. We are meaningfully ahead of last year at this point.
Got it. Thank you.
Your next question is coming from Michael Cherny from Leerink Partners. Michael, your line is live. Please go ahead.
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 as you have alluded to. When you think about the visibility you had at this point last quarter, you talked about utilization improving, but 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, how did that play out specifically tied to ending the quarter and into the print?
The visibility has not changed. The algorithms that we use have improved, which is the work you are referring to in terms of improved visibility. But the visibility window is still the same. We have good visibility into the month ahead and a little less visibility into the month after that. That is not new; that is generally how far ahead people are scheduling appointments. We look at a lot of underlying data and use that when we guide. That is what we used last quarter when we reported in May and what we are using now as we report Q2. What we are seeing so far exiting the quarter and looking at past history indicates a normalization back to normal levels of engagement for the remainder of the year.
Got it. And one more additional question: cash flow build has been very strong. You obviously have Select going on and some other ancillary programs. How do you think about the future usage of capital deployment for both internal and external investments as you continue to broaden your lead in the market?
We have the cash flow to continue to invest. The level of investment will come down as we had mentioned in prior calls starting in 2027. Our larger investments happened over the last two years and we will finish out incremental investments through the end of this year. We have the capital to make decisions around M&A, whether they are tuck-ins or otherwise, whether there are additional repurchases we are going to do or any other additional investments. We have the cash flow to do all three.
Your next question is coming from Sarah James from Cantor Fitzgerald.
Thank you. On the improved algorithm that you were talking about, can you give us an idea of what the slope or level of confidence looks like? How is your confidence two weeks out, four weeks out, six weeks out? What does that look like for you now?
Given the actual visibility we have, and given that it is a consumption model, any periods further out inherently have less visibility. The algorithms have improved significantly and have proven to be pretty predictable. But things like more pronounced seasonality than you otherwise had visibility into can happen, and that is what we are experiencing. Overall, toward the midpoint, it is about a one percent adjustment, so we are not talking about a large adjustment in consumption.
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?
It is not material today. As I mentioned in my prepared remarks, we do not expect it to be material in terms of new lives for 2027. Those channel partners will take time both in terms of signing up and, more importantly, getting throughput from them relative to when their renewals happen—the majority of which are for January 1 starts. Many of these organizations are roll-ups of a lot of small companies, so it is a grassroots effort to reach all their brokers. The relationships we have built so far are positive and partners are inclined to work with us, but this is a medium- to long-term strategy and we view it as important to be additive over time rather than a source of immediate contribution for 2027.
Your next question is coming from Scott Schoenhaus from KeyBanc. Scott, your line is live. Please go ahead.
Thanks guys for taking my question. Just to drill in a little bit more on the summertime softness: is there anything glaringly different than you expected in terms of a certain cohort? Is it a new cohort you onboarded this year that had fewer egg retrievals happening into the summer, and now you are seeing appointments being booked for surgeries or medications ordered for September into the fall? Was it regional softness? Any color to explain why this was more pronounced this year versus other years and whether you are seeing a delay in certain populations?
The short answer is there is not anything pronounced in any one of those categories you described. We certainly take a look at those things to see if there is anything that would be different than a seasonality event. It is more across the board in all those categories.
Okay. And then on the selling season, you noted you are seeing competitive conversations from people that previously had competitors' benefits. Can you dive into more color 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 employees want a more robust benefit? This is the first time you have commented on something like this, and I want to hear what customers are saying when they are coming to you. Thanks.
The only reason I called it out is because it is more than what we have seen in the past. We are getting all sorts of opportunities from brownfield and some greenfield as well. When you get these opportunities, you do not always get the full picture of what they are unhappy about; they may simply be out there running an RFP or market check. There is not a lot of consistent discussion around specific things not working. There is some anecdotal feedback, but I do not want to lean heavily on anecdotes. The more insightful commentary is that the activity is happening in higher volume and we are winning a lot of it. That, combined with our proven reporting and ROI focus, underpins why employers are engaging with us.
To add to Peter's comment, our prepared remarks emphasized cost containment and pressures on employers, which we believe is part of the root cause of why they are coming to us. We have a proven model that helps control costs, and we believe that is driving some of this activity.
Your next question is coming from Allen Lutz from Bank of America. Allen, your line is live. Please go ahead.
Good afternoon, and thanks for taking the questions. One for Peter or Mark: around the selling season piece, is there any way to bifurcate engagement from prospects that are looking at fertility benefits for the first time versus those that are potential competitive conversions? Anything changed with those who currently do not offer a fertility benefit? Second, the conversation around GLP-1s continues to evolve and some PBMs are talking about employers 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 triangulate whether any of those things are hitting your prospects or if it is too early. Thanks.
Building on Mark's comment, we are seeing more brownfield than greenfield this year, meaning more activity from employers who already have some benefit in place and are evaluating change. This includes competitors across the landscape, not just VC-backed competitors but also carrier solutions. We still view carrier-provided solutions as competitors. The reality is employers are trying to manage rising medical costs, some of which are being driven by higher utilization and new drugs such as GLP-1s. It is not surprising that employers are looking to contain costs and are therefore evaluating alternatives that help them bend the cost curve. While we are seeing greenfield opportunities, the brownfield opportunities are more pronounced this year.
Thank you. Your next question is coming from Peter Warendorf from Barclays. Peter, your line is live. Please go ahead.
Thanks for the question. It looks like clients ticked up slightly in the second quarter but membership was closer to flat. I know it is not a huge difference, but are you seeing any impact from broader employment trends or a weaker employment environment? What are you assuming in guidance over the second half of the year in terms of membership at current clients?
Just as a reminder, we typically count only those clients that have one thousand lives or more as client counts. We have a number of smaller clients that we exclude from the count though we include the lives. There were a handful of clients that graduated beyond the thousand-life level, but those changes are not material to the overall averages. Lives have been relatively consistent—some clients go up a little, some go down a little, but overall stability remains. From a projection standpoint, we are maintaining the same full-year estimate we have had for a couple of quarters. We do have a couple of very small clients starting in the second half, but nothing meaningful from a revenue perspective.
Great. And then just quickly on the selling season: it is encouraging you reiterated the one million target for this year. How much visibility do you have into that target for next year at this point, and what might be the expectation for how many of those lives come from Select versus traditional membership?
Our target of adding one million lives is our usual annual ambition. We have a pretty nice pipeline building for the next year's selling season, and we expect more pipeline to come in as well, much of which will carry over into next year. We are seeing activity particularly from some jumbo opportunities for next year, but it is early to say whether those will push us to a million lives again. Regarding Progyny Select, as I said earlier, we will add more clarity when we have it. For now, Select is a medium- to long-term initiative—this year and next will be focused more on forging distribution relationships and then gradually building throughput from those channels, many of whose renewals are January 1 starts. We expect Select to be additive over time rather than a meaningful contributor in 2027.
Your next question is coming from John Pinney from Canaccord Genuity. John, your line is live. Please go ahead.
Hi. John Pinney here. Thanks for the questions. Any commentary about what gives you confidence for those prospects who have not been signed yet at this point in the season that their intent is to sign by the end of the year for next year? What gives you the confidence they will not turn into not-nows?
We have a lot of tracking and tools and are in frequent conversations with our salesforce and sales leaders, particularly around the larger deals in the pipeline. We track a lot of objective sales progression criteria for our pipeline—activities, buying questions, document requests, and so forth. We combine that objective data with qualitative input from our sales teams and our historical experience around how those opportunities progress to estimate where we are likely to land.
Okay. And as a follow-up, is there any way you can quantify how much the investments this year are factoring into EBITDA guidance for the year?
We have not historically quantified that precisely. What we have said is that the increase in capital expenditures from 2024 to 2025 and now through 2026 corresponds with roughly an equivalent amount of operating expense running through the P&L. In other words, the investment program shows up both as higher CapEx and higher OpEx relative to prior periods.
Alright. Thank you.
And our final question this afternoon is coming from David Larsen from BTIG. David, your line is live. Please go ahead.
Hi. We spoke recently with a benefits consultant and he said that of his 12 or 13 clients that he supports, Progyny was in about seven of them, which I was positively surprised to hear. It makes me think that you have somewhat of a dominant fertility support position in the market. What are your thoughts in terms of growing your revenue and opportunities to upsell additional services into your existing base? What products or services may you develop that could drive incremental revenue growth? Also, can you comment on international expansion efforts since you are doing so well in the U.S.? Europe and other international markets seem like the next frontier.
We do not own as much market share as that consultant suggested, so that comment is not representative. Nonetheless, we are one of the larger providers of fertility and family benefits in the U.S. With respect to opportunities within our existing base, it is largely the products we already offer—expanded products and additional cycles. Many clients start with a two- to three-cycle benefit and may add egg freezing over time. Over time, cohorts generally add coverage—more cycles, egg freezing, pharmacy, or other expanded products. There are still opportunities to run the existing base and to add new logos. Regarding opportunities outside the U.S., the international opportunity is different in financial contribution versus the U.S. It is more focused on winning multinational companies whose parent is based in the U.S. and offering a solution that addresses their global population needs, even if the exact solution varies due to regulatory limitations. We continue to invest in international capabilities to support multinational clients and capture that opportunity.
Okay. Thanks very much and congrats on a good quarter.
This does conclude today's question-and-answer session. I would now like to hand the floor back to James Hart for closing remarks.
Thank you, Tom, and thank you, everyone, for joining us this afternoon. Please feel free to reach out 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.
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.