Modivcare (Nasdaq: MODV) started off 2025 with a decline in revenue, which it partially attributed to lower volumes in its personal care segment.
The company announced that its overall service revenue for Q1 2025 amounted to $650.7 million, a 4.9% year-over-year decrease. It also announced a multi-pronged plan for the year ahead, including a cost-saving mission
“The decline was driven primarily by known [non-emergency medical transportation] (NEMT) contract attrition, lower billed hours in (personal care services) PCS and membership churn in monitoring,” Heath Sampson, Modivcare CEO, said on Thursday’s call. “These impacts are expected and reflect prior year customer transitions and market dynamics that are now largely behind us.”
Denver-based Modivcare provides non-emergency medical transportation (NEMT), and its Modivcare Home division includes personal care, remote patient monitoring (RPM) and meal delivery service offerings.
Modivcare’s Q1 net loss came in at $50.4 million, up from $22.3 million year-over-year. Sampson attributed this to higher interest expense.
The company’s personal care services segment revenue came in $181.8 million, 28% of its total revenue. While revenue per hour rose 1.1%, service hours declined 2.1%, which Sampson said was because of expected seasonality and localized labor shortages.
Sampson also announced that the company signed four strategic personal care agreements, including two national and two regional plans expected to generate between 40,000 and 50,000 monthly service hours with contribution margins above its Medicaid average.
Modivcare has previously relied on its personal care services to translate into improved margins.
The call comes days after the announcement that the company parted ways with its chief financial officer and chief information officer without plans to replace the executives.
“These transitions are deliberate and aligned with both our near-term priorities and the long-term direction of the business,” Sampson said.
The CEO announced five enterprise objectives on the call. First, the company plans to grow and retain core customers across all its segments.
Next, Modivcare announced that it would digitize and automate its care access platform. It also plans to optimize its operating models for simplicity and scale.
Modivcare also plans to increase capital efficiency and deliver “high-impact, client-centric supportive care.”
“These five objectives guide our decision making across segments and functions, and will continue to serve as the structure for how we communicate execution and performance going forward,” Sampson said.
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