Progyny (PGNY) 10-Q 8 Nov 23 2023 Q3 Quarterly report Financial data

Cover Page

Cover Page - shares	9 Months Ended
	Sep. 30, 2023	Oct. 31, 2023
Cover [Abstract]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Sep. 30, 2023
Document Transition Report	false
Entity File Number	001-39100
Entity Registrant Name	Progyny, Inc.
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	27-2220139
Entity Address, Address Line One	1359 Broadway
Entity Address, City or Town	New York
Entity Address, State or Province	NY
Entity Address, Postal Zip Code	10018
City Area Code	212
Local Phone Number	888-3124
Title of 12(b) Security	Common Stock,
Trading Symbol	PGNY
Security Exchange Name	NASDAQ
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		95,836,228
Entity Central Index Key	0001551306
Current Fiscal Year End Date	--12-31
Document Fiscal Year Focus	2023
Document Fiscal Period Focus	Q3
Amendment Flag	false

Consolidated Balance Sheets (Un

Consolidated Balance Sheets (Unaudited) - USD ($) $ in Thousands	Sep. 30, 2023	Dec. 31, 2022
Current assets:
Cash and cash equivalents	$ 158,075	$ 120,078
Marketable securities	177,477	69,222
Accounts receivable, net of $42,896 and $28,328 of allowances at September 30, 2023 and December 31, 2022, respectively	268,766	240,067
Prepaid expenses and other current assets	6,954	4,489
Total current assets	611,272	433,856
Property and equipment, net	9,716	8,371
Operating lease right-of-use assets	18,028	6,903
Goodwill	11,880	11,880
Intangible assets, net	0	99
Deferred tax assets	72,027	77,889
Other noncurrent assets	3,589	3,988
Total assets	726,512	542,986
Current liabilities:
Accounts payable	132,040	109,287
Accrued expenses and other current liabilities	61,379	50,249
Total current liabilities	193,419	159,536
Operating lease noncurrent liabilities	17,700	6,482
Total liabilities	211,119	166,018
Commitments and Contingencies (Note 6)
STOCKHOLDERS' EQUITY
Common stock, $0.0001 par value; 1,000,000,000 shares authorized at September 30, 2023 and December 31, 2022; 95,764,690 and 93,301,156 shares issued and outstanding at September 30, 2023 and December 31, 2022, respectively	9	9
Additional paid-in capital	438,044	349,533
Treasury stock, at cost, $0.0001 par value; 615,980 shares at September 30, 2023 and December 31, 2022	(1,009)	(1,009)
Accumulated earnings	76,501	27,934
Accumulated other comprehensive income	1,848	501
Total stockholders’ equity	515,393	376,968
Total liabilities and stockholders’ equity	$ 726,512	$ 542,986

Consolidated Balance Sheets (_2

Consolidated Balance Sheets (Unaudited) (Parenthetical) - USD ($) $ in Thousands	Sep. 30, 2023	Dec. 31, 2022
Allowances for accounts receivable
Allowances for accounts receivable	$ 42,896	$ 28,328
Common stock
Common stock, par value (in dollars per share)	$ 0.0001	$ 0.0001
Common stock, shares authorized (in shares)	1,000,000,000	1,000,000,000
Common stock, shares issued (in shares)	95,764,690	93,301,156
Common stock, shares outstanding (in shares)	95,764,690	93,301,156
Treasury stock
Treasury stock, par value (in dollars per share)	$ 0.0001	$ 0.0001
Treasury stock, shares outstanding (in shares)	615,980	615,980

Consolidated Statements of Oper

Consolidated Statements of Operations (Unaudited) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022
Statements of Operations
Revenue	$ 280,891	$ 205,371	$ 818,658	$ 572,592
Cost of services	218,267	159,376	636,753	449,761
Gross profit	62,624	45,995	181,905	122,831
Operating expenses:
Sales and marketing	14,911	11,166	44,577	32,677
General and administrative	29,524	23,574	88,944	70,119
Total operating expenses	44,435	34,740	133,521	102,796
Income from operations	18,189	11,255	48,384	20,035
Other income, net:
Other income, net	1,708	82	3,483	11
Interest income, net	1,034	202	2,562	254
Total other income, net	2,742	284	6,045	265
Income before income taxes	20,931	11,539	54,429	20,300
(Provision) benefit for income taxes	(5,033)	1,672	(5,862)	6,650
Net income	$ 15,898	$ 13,211	$ 48,567	$ 26,950
Net income per share:
Basic (in dollars per share)	$ 0.17	$ 0.14	$ 0.51	$ 0.29
Diluted (in dollars per share)	$ 0.16	$ 0.13	$ 0.48	$ 0.27
Weighted-average shares used in computing net income per share:
Basic (in shares)	95,502,250	92,316,022	94,698,616	91,901,778
Diluted (in shares)	100,879,576	99,819,801	100,552,705	99,865,366

Consolidated Statement of Compr

Consolidated Statement of Comprehensive Income (Unaudited) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022
Statement of Comprehensive Income (Loss)
Net income	$ 15,898	$ 13,211	$ 48,567	$ 26,950
Other comprehensive income:
Unrealized gain on marketable securities	754	187	1,346	298
Foreign currency translation gain	12	0	1	0
Total other comprehensive income	766	187	1,347	298
Total comprehensive income	$ 16,664	$ 13,398	$ 49,914	$ 27,248

Consolidated Statements of Chan

Consolidated Statements of Changes in Stockholders' Equity (Unaudited) - USD ($) $ in Thousands	Total	Common Stock	Treasury Stock	Additional Paid in Capital	Accumulated Earnings (Deficit)	Other Comprehensive Income (Loss)
Balance at beginning of period (in shares) at Dec. 31, 2021		91,088,781
Balance at beginning of period at Dec. 31, 2021	$ 251,822	$ 9	$ (1,009)	$ 255,339	$ (2,424)	$ (93)
Increase (Decrease) in Stockholders' Equity (Loss)
Issuance of employee equity awards, net of shares withheld (in shares)		1,544,403
Issuance of employee equity awards, net of shares withheld	(4,157)			(4,157)
Stock-based compensation	71,943			71,943
Other comprehensive income	298					298
Net income	26,950				26,950
Balance at end of period (in shares) at Sep. 30, 2022		92,633,184
Balance at end of period at Sep. 30, 2022	346,856	$ 9	(1,009)	323,125	24,526	205
Balance at beginning of period (in shares) at Jun. 30, 2022		92,056,816
Balance at beginning of period at Jun. 30, 2022	311,024	$ 9	(1,009)	300,691	11,315	18
Increase (Decrease) in Stockholders' Equity (Loss)
Issuance of employee equity awards, net of shares withheld (in shares)		576,368
Issuance of employee equity awards, net of shares withheld	(984)			(984)
Stock-based compensation	23,418			23,418
Other comprehensive income	187					187
Net income	13,211				13,211
Balance at end of period (in shares) at Sep. 30, 2022		92,633,184
Balance at end of period at Sep. 30, 2022	$ 346,856	$ 9	(1,009)	323,125	24,526	205
Balance at beginning of period (in shares) at Dec. 31, 2022	93,301,156	93,301,156
Balance at beginning of period at Dec. 31, 2022	$ 376,968	$ 9	(1,009)	349,533	27,934	501
Increase (Decrease) in Stockholders' Equity (Loss)
Issuance of employee equity awards, net of shares withheld (in shares)		2,215,862
Issuance of employee equity awards, net of shares withheld	(5,740)			(5,740)
Stock-based compensation	94,251			94,251
Warrant exercise (in shares)		247,672
Other comprehensive income	1,347					1,347
Net income	$ 48,567				48,567
Balance at end of period (in shares) at Sep. 30, 2023	95,764,690	95,764,690
Balance at end of period at Sep. 30, 2023	$ 515,393	$ 9	(1,009)	438,044	76,501	1,848
Balance at beginning of period (in shares) at Jun. 30, 2023		95,165,253
Balance at beginning of period at Jun. 30, 2023	469,499	$ 9	(1,009)	408,814	60,603	1,082
Increase (Decrease) in Stockholders' Equity (Loss)
Issuance of employee equity awards, net of shares withheld (in shares)		351,765
Issuance of employee equity awards, net of shares withheld	(2,175)			(2,175)
Stock-based compensation	31,405			31,405
Warrant exercise (in shares)		247,672
Other comprehensive income	766					766
Net income	$ 15,898				15,898
Balance at end of period (in shares) at Sep. 30, 2023	95,764,690	95,764,690
Balance at end of period at Sep. 30, 2023	$ 515,393	$ 9	$ (1,009)	$ 438,044	$ 76,501	$ 1,848

Consolidated Statements of Cash

Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022
Net Income (Loss), Including Portion Attributable to Noncontrolling Interest [Abstract]
Net income	$ 48,567	$ 26,950
Adjustments to reconcile net income to net cash provided by operating activities:
Deferred tax expense (benefit)	5,862	(6,742)
Non-cash interest income	58	0
Depreciation and amortization	1,647	1,155
Stock-based compensation expense	93,812	71,451
Bad debt expense	15,062	9,685
Realized gain on sale of marketable securities	(2,701)	0
Foreign currency exchange rate loss	12	0
Changes in operating assets and liabilities:
Accounts receivable	(43,761)	(133,163)
Prepaid expenses and other current assets	(2,523)	1,715
Accounts payable	22,884	42,707
Accrued expenses and other current liabilities	11,744	16,330
Other noncurrent assets and liabilities	492	(1,210)
Net cash provided by operating activities	151,155	28,878
INVESTING ACTIVITIES
Purchase of property and equipment, net	(2,963)	(2,520)
Purchase of marketable securities	(262,961)	(125,156)
Sale of marketable securities	158,813	84,983
Net cash used in investing activities	(107,111)	(42,693)
FINANCING ACTIVITIES
Proceeds from exercise of stock options	3,573	2,130
Payment of employee taxes related to equity awards	(10,504)	(7,957)
Proceeds from contributions to employee stock purchase plan	884	749
Net cash used in financing activities	(6,047)	(5,078)
Effect of exchange rate changes on cash and cash equivalents	0	0
Net increase (decrease) in cash and cash equivalents	37,997	(18,893)
Cash and cash equivalents, beginning of period	120,078	91,413
Cash and cash equivalents, end of period	158,075	72,520
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
Cash paid for income taxes, net of refunds received	2,318	146
SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING AND FINANCING ACTIVITIES
Additions of property and equipment, net included in accounts payable and accrued expenses	$ 128	$ 76

Business and Basis of Presentat

Business and Basis of Presentation	9 Months Ended
	Sep. 30, 2023
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Business and Basis of Presentation	Business and Basis of Presentation Description of Business Progyny, Inc. (together with its subsidiaries referred to as “Progyny” or the “Company”) was incorporated in the state of Delaware on April 3, 2008, and maintains its corporate headquarters in New York, NY. Progyny is a provider of a fertility benefits solution and pharmacy benefits solution and operates and manages in one operating segment. The fertility benefits solution consists of a significant service that integrates: (1) the treatment services (“Smart Cycles”) that the Company has designed, (2) access to the Progyny network of high-quality fertility specialists that perform the Smart Cycle treatments and (3) active management of the selective network of high-quality provider clinics, real-time member eligibility and treatment authorization, member-facing digital tools and detailed quarterly reporting supported by the Company’s dedicated account management teams, and end to end comprehensive concierge member support provided by Progyny’s in-house staff of Patient Care Advocates (“PCAs”) (collectively, the “care management services”). The Company enhanced its fertility benefits solution with the launch of Progyny Rx, its pharmacy benefits solution, effective January 1, 2018. Progyny Rx provides the Company's members with access to the medications needed during their fertility treatment. As part of this solution, the Company provides care management services, which include formulary plan design, simplified authorization, assistance with prescription fulfillment, and timely delivery of the medications by the Company’s network of specialty pharmacies, as well as medication administration training, pharmacy support services, and continuing PCA support. As a pharmacy benefits solution provider, Progyny manages the dispensing of pharmaceuticals through the Company’s specialty pharmacy contracts. The pharmacy benefits solution is only available as an add-on service to its fertility benefits solution. Basis of Presentation The accompanying interim unaudited consolidated financial statements include the accounts of Progyny, Inc. and its wholly owned subsidiaries. The interim unaudited consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”) applicable to interim financial reporting. These interim consolidated financial statements have been prepared on a basis consistent with the annual consolidated financial statements and, in the opinion of management, include all adjustments necessary to fairly state the Company's financial position as of September 30, 2023, the results of the Company's operations for the three and nine months ended September 30, 2023 and 2022 and the results of the Company's cash flows for the nine months ended September 30, 2023 and 2022. Therefore, these unaudited consolidated financial statements should be read in conjunction with the audited consolidated financial statements and related footnotes included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2022, filed with the SEC on March 1, 2023 (the “Annual Report on Form 10-K”). The results for the three and nine months ended September 30, 2023 are not necessarily indicative of the operating results expected for the year ending December 31, 2023 or any other future period. Additionally, the coronavirus ("COVID-19") pandemic continues to evolve and due to the uncertainty of the pandemic, including variants, the Company's customers and members, provider network, specialty pharmacy partners, employees, suppliers, vendors, and other business partners may continue to be impacted in future periods. A resurgence of COVID-19 could have a material adverse effect on the Company’s business, financial condition, results of operations and growth prospects. The Company will continue to assess these potential impacts to its business and will make adjustments to its operations as necessary. Use of Estimates The preparation of consolidated financial statements in conformity with U.S. GAAP generally requires management to make estimates and assumptions that affect the reported amount of certain assets, liabilities, revenue, and expenses, and the related disclosure of contingent assets and liabilities. Such estimates include, but are not limited to, the determination of accrued receivables related to revenue recognition, accrued claims payable, allowance for doubtful accounts, stock-based compensation expense, lease liabilities, and accounting for income taxes. Management bases its

Significant Accounting Policies

Significant Accounting Policies	9 Months Ended
	Sep. 30, 2023
Accounting Policies [Abstract]
Significant Accounting Policies	Significant Accounting Policies There have been no material changes in the Company’s significant accounting policies as compared to the significant accounting policies described in Note 2 of the Company’s Annual Report on Form 10-K. Revenue Recognition Revenue is recognized when control of the promised goods or services is transferred to clients in an amount that reflects the consideration the Company expects to be entitled to in exchange for those goods or services. The Company applies the following five-step model to recognize revenue from contracts with clients: • Identification of the contract, or contracts, with a client; • Identification of the performance obligations in the contract; • Determination of the transaction price; • Allocation of the transaction price to the performance obligations in the contract; and • Recognition of revenue when, or as, a performance obligation is satisfied. Progyny’s contracts typically have a stated term of three years and include contractual termination options after the first year, allowing the client to terminate the contract with 30 to 90 days’ notice. Fertility Benefits Solution Revenue Progyny primarily generates revenue through its fertility benefits solution, in which Progyny provides self-insured enterprise entities (“clients”) and their employees and partners (together, “members”) with fertility benefits. As part of the fertility benefits solution, Progyny provides access to effective and cost-efficient fertility treatments, referred to as Smart Cycles, as well as other related services. Smart Cycles are proprietary treatment bundles that include certain medical services available to members through Progyny’s proprietary, credentialed network of provider clinics. In addition to access to Progyny’s Smart Cycle treatment bundles and access to Progyny’s network of provider clinics, the fertility benefits solution includes other comprehensive services, which Progyny refers to as care management services, such as active management of the provider clinic network, real-time member eligibility and treatment authorization, member-facing digital tools throughout the Smart Cycle and detailed quarterly reporting all supported by client facing account management and end-to-end comprehensive member support provided by Progyny’s in house staff of PCAs. The promises within Progyny’s fertility benefits contract with a client represent a single performance obligation because Progyny provides a significant service of integrating the Progyny designed Smart Cycles and access to the fertility treatment services provided by provider clinics with the other comprehensive services into the combined fertility benefits solution that the client contracted to receive. Progyny’s fertility benefits solution is a stand-ready obligation that is satisfied over the contract term. Progyny’s contracts include the following sources of consideration, which are all variable: a per employee per month (“PEPM”) administration fee (in most, but not all contracts) and a fixed rate per Smart Cycle. The PEPM administration fee is allocated between the fertility benefits solution and the pharmacy benefits solution based on standalone selling price, estimated using an expected cost-plus margin method. The Company allocates the variable consideration related to the fixed rate per Smart Cycle to the distinct period during which the related services were performed as those fees relate specifically to the Company’s efforts to provide its fertility benefits solution to its clients in the period and represents the consideration the Company is entitled to for the fertility benefits services provided. As a result, the fixed rate per Smart Cycle is included in the transaction price and recognized in the period in which the Smart Cycle is provided to the member. Progyny’s contracts also include potential service level agreement refunds related to outcome-based service metrics. These service level refunds, which are determined based on results of a full plan year, if met, are based on a percentage of the PEPM fee paid by clients. The Company estimates the variable consideration related to the total PEPM administration fee, less estimated refunds related to service level agreements, and recognizes the amounts allocated to the fertility benefits solution ratably over the contract term. Progyny’s estimates of service level agreement refunds have not historically resulted in significant adjustments to the transaction price. Clients are typically invoiced on a monthly basis for the PEPM administration fee. Progyny invoices its clients and members for their respective portions of the fixed rate per Smart Cycle bundle when all treatment services within a Smart Cycle are completed by the provider clinic. Once an invoice is issued, payment terms are typically between 30 to 60 days. The Company assesses whether it is the principal or the agent for each arrangement with a client, since fertility treatment services are provided by a third party—the provider clinics. The Company is the principal in its arrangements with clients and therefore presents revenue gross of the amounts paid to the provider clinics because Progyny controls the specified service (the fertility benefits solution) before it is transferred to the client. Progyny integrates the fertility treatment services provided by the provider clinics into the overall fertility benefits solution that the client contracted to receive. In addition, Progyny defines the scope of the potential services to be performed by the provider clinics and monitors the performance of the provider clinics. Furthermore, Progyny is primarily responsible for fulfilling the promise to the client and has discretion in setting the pricing, as Progyny separately negotiates agreements with the provider clinics, which establish pricing for each treatment service. Pricing of services from provider clinics is independent from the fees charged to clients. Pharmacy Benefits Solution Revenue For clients that have the fertility benefits solution, Progyny offers, as an add-on, its pharmacy benefits solution, which is a separate, fully integrated pharmacy benefit. As part of the pharmacy benefits solution, Progyny provides care management services, which include Progyny’s formulary plan design, prescription fulfillment, simplified authorization and timely delivery of the medications used during treatment through Progyny’s network of specialty pharmacies, and clinical services consisting of member assessments, UnPack It calls, telephone support, online education, medication administration training, pharmacy support services and continuing PCA support. The pharmacy-related promises represent a single performance obligation because Progyny provides a significant service of integrating the formulary plan design, prescription fulfillment, clinical services and PCA support into the combined pharmacy benefits solution that the client contracted to receive. The pharmacy benefits solution is a stand-ready obligation that is satisfied over the contract term. Progyny’s contracts include the following sources of consideration, all of which are variable: a PEPM administration fee (in most, but not all contracts) and a fixed fee per fertility drug. As described above, the PEPM administration fee, less estimated refunds related to service level agreements, is allocated to the pharmacy benefits solution and recognized ratably over the contract term. The Company allocates the variable consideration related to the fixed fee per fertility drug to the distinct period during which the related services were performed, as those fees relate specifically to the Company’s efforts to provide its pharmacy benefits solution to clients in the period and represents the consideration the Company is entitled to for the pharmacy benefits services provided. As a result, the fixed fee per fertility drug is included in the transaction price and recognized in the period in which the Company is entitled to consideration from a client, which is when a prescription is filled and delivered to the members. As stated above, clients are invoiced on a monthly basis for the PEPM administration fee. Progyny invoices the client and the member for their respective portions of the fixed fee per fertility drug, when the prescription services are completed by the specialty pharmacies. Once an invoice is issued, payment terms are typically between 30 to 60 days. The Company assesses whether it is the principal or the agent for each arrangement with a client, as prescription fulfillment and clinical services are provided by a third party—the specialty pharmacies. The Company is the principal in its arrangements with clients, and therefore presents revenue gross of the amounts paid to the specialty pharmacies. Progyny controls the specified service (the pharmacy benefits solution) before it is transferred to the client. Progyny integrates the prescription fulfillment and clinical services provided by the pharmacies and PCAs into the overall pharmacy benefits solution that the client contracted to receive. In addition, Progyny defines the scope of the potential services to be performed by the specialty pharmacies and monitors the performance of the specialty pharmacies. Furthermore, Progyny is primarily responsible for fulfilling the promise to the client and has discretion in setting the pricing, as Progyny separately negotiates agreements with pharmacies, which establish pricing for each drug. Pricing of fertility drugs is independent from the fees charged to clients. The Company does not disclose the transaction price allocated to remaining performance obligations because all of the transaction price is variable and is allocated to the distinct periods to which the services relate, as discussed above. The remaining contract term is typically less than one year, due to the client’s contractual termination options. There were no material contract asset or contract liability balances as of September 30, 2023 and December 31, 2022. Accrued Receivables and Accrued Claims Payable Accrued receivables are estimated based on historical experience for those fertility benefits services provided but for which a claim has not been received from the provider clinic at the end of the reporting period, which includes assumptions regarding the lag between authorization date and service date as well as estimates for changes and cancellations of services. At the same time, cost of services and accrued claims payables are estimated based on the amount to be paid to the provider clinic and expected gross margin on fertility benefits services. Estimates are adjusted to actual at the time of billing. Adjustments to original estimates have not been material. As of September 30, 2023 and December 31, 2022, accrued receivables were $63.7 million and $54.6 million, respectively. Accrued receivables are included within accounts receivable in the consolidated balance sheet. Accrued claims payable of $37.1 million and $31.1 million as of September 30, 2023 and December 31, 2022, respectively, are included within accrued expenses and other current liabilities in the consolidated balance sheet. Claims payable are generally paid within 30 days based on contractual terms. As of September 30, 2023 and December 31, 2022, unbilled receivables, which represent claims received and approved but unbilled at the end of the reporting period, were $49.4 million and $42.9 million, respectively. Unbilled receivables are typically billed to clients within 30 days of the approved claim based on the contractual billing schedule agreed upon with the client. Unbilled receivables are included in accounts receivable in the consolidated balance sheet. Accounts Receivable and Allowance for Doubtful Accounts The accounts receivable balance primarily includes amounts due from clients and members. The Company estimates the allowance for doubtful accounts based on the lifetime expected credit losses for the client and member receivable pools, respectively. Under this current expected credit losses model, the Company determines the allowance for doubtful accounts based on factors such as the age of the receivable balance, historical experience, current economic conditions, and reasonable and supportable forecasts of future economic conditions. An allowance for credit losses is applied at the time the asset is recognized. Expected credit losses are recorded as general and administrative expenses on the consolidated statements of operations . The following table provides a summary of the activity in this allowance (in thousands): Nine Months Ended September 30, 2023 Balance at Beginning of Period Charged to Costs and Expenses Write-offs Balance at End of Period Allowance for doubtful accounts $ 28,328 $ 15,062 $ (494) $ 42,896 Cost of Services Fertility Benefits Services Fertility benefits services costs include: (1) fees paid to provider clinics within the Company’s network, labs and anesthesiologists; (2) costs incurred (including salaries, bonuses, benefits, stock-based compensation expense, other related costs, and an allocation of the Company's general overhead, depreciation and amortization) for those employees associated with care management service functions: Provider Account Management, PCA, Provider Relations and Claims Processing teams; and (3) related information technology support costs. Contracts with provider clinics are typically for a term of one Pharmacy Benefits Services Pharmacy benefits services costs include: (1) the fees for prescription drugs dispensed and clinical services provided during the reporting period by specialty pharmacy partners; (2) costs incurred (including salaries, bonuses, benefits, stock-based compensation expense, other related costs, and an allocation of the Company's general overhead, depreciation and amortization) for those employees associated with care management service functions: PCA, Provider Relations and Claims Processing teams; and (3) related information technology support costs. Contracts with the specialty pharmacies are typically for a term of one year. In the specialty pharmacy contracts, the contractual fees of prescription drugs sold includes the cost of the prescription drugs purchased and shipped to members by the Company’s specialty mail service dispensing pharmacies, net of any volume-related or other discounts. Vendor Rebates The Company receives a rebate on formulations purchased and dispensed by the Company’s specialty pharmacies. The Company’s contractual arrangements with pharmacy program partners provide for the Company to receive a discount (or rebate) from established list prices paid subsequent to dispensing when products are purchased indirectly from a pharmacy program partners (such as through a specialty pharmacy). These rebates are recognized as a reduction of cost of services when prescriptions are dispensed and are generally estimated and billed to manufacturers within 20 days after the end of each month. The effect of adjustments resulting from the reconciliation of rebates recognized to the amounts billed and collected has not been material to the Company’s results of operations. Recently Adopted Accounting Pronouncements In May 2021, the FASB issued ASU No. 2021-04 (“ASU 2021-04”) “ Earnings Per Share (Topic 260), Debt-Modifications and Extinguishments (Subtopic 470-50), Compensation- Stock Compensation (Topic 718), and Derivatives and Hedging-Contracts in Entity’s Own Equity (Subtopic 815- 40) ” which provides guidance on modifications or exchanges of a freestanding equity-classified written call options that are not within the scope of another Topic, such as warrants. The Company adopted this standard as of January 1, 2022 on a prospective basis to modifications or exchanges occurring on or after this date. The adoption of this standard did not have a material impact on the Company’s consolidated financial statements.

Revenue

Revenue	9 Months Ended
	Sep. 30, 2023
Revenue from Contract with Customer [Abstract]
Revenue	Revenue Disaggregated revenue The following table disaggregates revenue by service (in thousands): Three Months Ended Nine Months Ended 2023 2022 2023 2022 Fertility benefits services revenue $ 175,110 $ 129,301 $ 504,993 $ 367,009 Pharmacy benefits services revenue 105,781 76,070 313,665 205,583 Total revenue $ 280,891 $ 205,371 $ 818,658 $ 572,592

Fair Value of Financial Instrum

Fair Value of Financial Instruments	9 Months Ended
	Sep. 30, 2023
Fair Value Disclosures [Abstract]
Fair Value of Financial Instruments	Fair Value of Financial Instruments The fair value of financial instruments is determined based on assumptions that market participants would use when pricing an asset or liability at the balance sheet date. Certain assets are categorized based on the following fair value hierarchy of market participant assumptions: Level 1 — Unadjusted quoted prices in active markets that are accessible at the measurement date for identical assets or liabilities. Level 2 — Inputs, other than quoted prices in active markets, that are observable either directly or indirectly. Level 3 — Prices or valuation techniques that require inputs that are both significant to the fair value of the asset or liability and supported by little or no market activity. The Company uses observable market data when available, and minimizes the use of unobservable inputs when determining fair value. As of September 30, 2023 and December 31, 2022, the Company had $64.1 million and $120.6 million, respectively, in financial assets held in money market accounts and $205.3 million and $69.2 million, respectively, held in U.S. treasury bills. All were classified as Level 1 in the fair value hierarchy. The Company measured these assets at fair value. The Company classified these assets as Level 1 because the values of these assets are determined using unadjusted quoted prices in active markets for identical assets. As of September 30, 2023 and December 31, 2022, the Company did not have any assets or liabilities classified as Level 2 or Level 3 in the fair value hierarchy.

Leases

Leases	9 Months Ended
	Sep. 30, 2023
Leases [Abstract]
Leases	Leases In September 2019, the Company’s sublease agreement for the 25,212 square foot office in its corporate headquarters commenced in New York, NY and is scheduled to expire in May 2029. Pursuant to the sublease, the Company is obligated to pay the base rent of approximately $1.3 million per annum through the end of the fifth lease year and approximately $1.4 million per annum thereafter through the expiration date. In February 2023, the Company's lease agreement for the additional 24,099 square foot office in its corporate offices commenced in New York, NY and is expected to expire in the fourth quarter of 2035. In accordance with ASC 842, the Company recorded right-of-use assets and lease liabilities of $12.2 million and $12.1 million, respectively. Pursuant to the lease, the Company is obligated to pay the base rent of approximately $1.4 million per annum beginning in April 2024 through the end of the fifth lease year and approximately $1.5 million per annum thereafter through the expiration date. The Company recognizes lease expense on a straight-line basis over the lease term. Lease expense for the three months ended September 30, 2023 and 2022 was $0.7 million and $0.3 million, respectively. For the nine months ended September 30, 2023 and 2022, lease expense was $1.7 million and $0.9 million, respectively. Cash outflows from operating activities attributable to the operating leases for each of the nine months ended September 30, 2023 and 2022 was $1.0 million. Information related to the Company's leases is as follows (in thousands): Balance Sheet Location September 30, 2023 December 31, 2022 Operating Leases Right-of-use asset Operating lease right-of-use assets $ 18,028 $ 6,903 Short-term lease liabilities Accrued expenses and other current liabilities $ 1,790 $ 1,231 Long-term lease liabilities Operating lease noncurrent liabilities $ 17,700 $ 6,482 Other information Weighted-average remaining lease term, operating lease 9.8 years 6.4 years Weighted-average discount rate, operating lease 4.59% 4.29% Future minimum facility lease payments related to the Company's operating lease liabilities as of September 30, 2023 were as follows (in thousands): Year Ending December 31: Operating Lease Payments as of September 30, 2023 2023 $ 321 2024 2,250 2025 2,793 2026 2,793 2027 2,793 Thereafter 13,641 Total undiscounted lease payments $ 24,591 Less: imputed interest 5,101 Present value of lease liabilities $ 19,490 Less: current portion of operating lease liabilities 1,790 Operating lease noncurrent liabilities $ 17,700 February 2022 Lease Agreement As noted above, the Company commenced its lease for the 24,099 square foot office in its corporate offices in New York, NY in February 2023, pursuant to a lease agreement entered into by the Company in February 2022. The lease agreement also provides for additional space in the Company's corporate offices, including an additional 21,262 square foot office and continued occupancy of the 25,212 square foot office after the expiration of the current sublease. For the 21,262 square foot office, the lease commencement date, which is when the premises will become available to the Company for use, is currently expected to be in the fourth quarter of 2024. The Company is obligated to pay the base rent of approximately $1.3 million starting in the fourth quarter of 2025 for five years and approximately $1.4 million per year thereafter through the fourth quarter of 2035, the expected expiration date. For the current 25,212 square foot office, the Company is obligated to pay the base rent of approximately $1.6 million per year beginning in June 2029, which is the lease commencement, through the fourth quarter of 2035, the expected expiration date.

Commitments and Contingencies

Commitments and Contingencies	9 Months Ended
	Sep. 30, 2023
Commitments and Contingencies Disclosure [Abstract]
Commitments and Contingencies	Commitments and Contingencies The Company records accruals for loss contingencies when it is probable that a liability will be incurred and the amount of the loss can be reasonably estimated. If the Company determines that a loss is reasonably possible, the Company discloses the matter, and the amount or range of the possible loss, if estimable, in the notes to the consolidated financial statements. From time to time, the Company is involved in certain claims and litigation arising in the normal course of business. The Company is not aware of any legal proceedings or claims, that the Company believes will have, individually or in the aggregate, a material adverse effect on the Company’s financial position or results of operations.

Stock-based Compensation Expens

Stock-based Compensation Expense	9 Months Ended
	Sep. 30, 2023
Share-Based Payment Arrangement [Abstract]
Stock-based Compensation Expense	Stock-based Compensation Expense The following table summarizes stock-based compensation expense, which was included in the statements of operations as follows (in thousands): Three Months Ended Nine Months Ended 2023 2022 2023 2022 Cost of services $ 8,941 $ 6,268 $ 25,967 $ 18,603 Sales and marketing 6,938 5,184 20,389 15,026 General and administrative 15,372 11,845 47,456 37,822 Total stock-based compensation expense $ 31,251 $ 23,297 $ 93,812 $ 71,451

Income Taxes

Income Taxes	9 Months Ended
	Sep. 30, 2023
Income Tax Disclosure [Abstract]
Income Taxes	Income Taxes For the nine months ended September 30, 2023 and 2022, the Company calculated its year-to-date provision for income taxes by applying the estimated annual effective tax rate to the year-to-date profit from operations before income taxes and adjusts the provision for income taxes for discrete tax items recorded in the period. The Company updates its estimate of its annual effective tax rate at the end of each quarterly period. The estimate takes into account annual forecasted income before income taxes and any significant permanent tax items. During the nine months ended September 30, 2023, the Company recorded a provision for income taxes of $5.9 million, primarily driven by the Company's operating profit, partially offset by equity compensation activity that occurred during the period. During the nine months ended September 30, 2022, the Company recorded a benefit for income taxes of $6.7 million, primarily due to equity compensation activity that occurred during the period.

Net Income Per Share

Net Income Per Share	9 Months Ended
	Sep. 30, 2023
Earnings Per Share [Abstract]
Net Income Per Share	Net Income Per Share Basic net income per share is calculated by dividing the net income by the weighted-average number of shares of common stock outstanding for the period. Diluted net income per share is computed by dividing the diluted net income by the weighted-average number of common shares outstanding for the period, including potential dilutive common shares assuming dilutive effect of outstanding common stock options, restricted stock units, common stock warrants, and shares issuable under the employee stock purchase plan. In periods when the Company has incurred a net loss, diluted net loss per share is the same as basic net loss per share because dilutive common shares are not assumed to have been issued if their effect is anti-dilutive. A reconciliation of net income and the number of shares in the calculation of basic and diluted net income per share is as follows (in thousands, except share and per share amounts): Three Months Ended Nine Months Ended 2023 2022 2023 2022 Basic net income per common share: Numerator: Net income $ 15,898 $ 13,211 $ 48,567 $ 26,950 Denominator: Weighted-average shares used in computing basic net income per share 95,502,250 92,316,022 94,698,616 91,901,778 Basic net income per share $ 0.17 $ 0.14 $ 0.51 $ 0.29 Diluted net income per common share: Numerator: Net income $ 15,898 $ 13,211 $ 48,567 $ 26,950 Denominator: Weighted-average shares used in computing basic net income per share 95,502,250 92,316,022 94,698,616 91,901,778 Effect of dilutive securities 5,377,326 7,503,779 5,854,089 7,963,588 Weighted-average shares used in computing diluted net income per share 100,879,576 99,819,801 100,552,705 99,865,366 Diluted net income per share $ 0.16 $ 0.13 $ 0.48 $ 0.27 The following weighted-average outstanding shares of potentially dilutive securities were excluded from the computation of diluted income per share for the period presented because including them would have been antidilutive: Three Months Ended Nine Months Ended 2023 2022 2023 2022 Options to purchase common stock 11,988,899 7,184,651 11,887,706 7,159,982 Shares issuable under employee stock purchase plan — — 1,589 — Restricted stock units 986,798 1,627,946 1,045,151 1,928,378 Total 12,975,697 8,812,597 12,934,446 9,088,360

Pay vs Performance Disclosure

Pay vs Performance Disclosure - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022
Pay vs Performance Disclosure
Net income	$ 15,898	$ 13,211	$ 48,567	$ 26,950

Insider Trading Arrangements

Insider Trading Arrangements	3 Months Ended	9 Months Ended
	Sep. 30, 2023 shares	Sep. 30, 2023 shares
Trading Arrangements, by Individual
Non-Rule 10b5-1 Arrangement Adopted	false
Rule 10b5-1 Arrangement Terminated	false
Non-Rule 10b5-1 Arrangement Terminated	false
David Schlanger [Member]
Trading Arrangements, by Individual
Material Terms of Trading Arrangement		On June 23, 2023, David Schlanger, our Executive Chairman, adopted a trading plan that is intended to satisfy the conditions under Rule 10b5-1(c) of the Exchange Act. Mr. Schlanger's trading plan is for the sale of up to 960,000 shares of the Company's common stock in amounts and prices determined in accordance with a formula set forth in the plan and terminates on the earlier of the date all shares under the plan are sold or August 30, 2024.
Name	David Schlanger
Title	Executive Chairman
Rule 10b5-1 Arrangement Adopted	true
Adoption Date	June 23, 2023
Arrangement Duration	340 days
Aggregate Available	960,000	960,000
Mark Livingston [Member]
Trading Arrangements, by Individual
Material Terms of Trading Arrangement		On August 7, 2023, Mark Livingston, our Chief Financial Officer, adopted a trading plan that is intended to satisfy the conditions under Rule 10b5-1(c) of the Exchange Act. Mr. Livingston's trading plan is for the sale of up to 148,627 shares of the Company's common stock in amounts and prices determined in accordance with a formula set forth in the plan and terminates on the earlier of the date all shares under the plan are sold or April 30, 2024.
Name	Mark Livingston
Title	Chief Financial Officer
Rule 10b5-1 Arrangement Adopted	true
Adoption Date	August 7, 2023
Arrangement Duration	176 days
Aggregate Available	148,627	148,627
Michael Sturmer [Member]
Trading Arrangements, by Individual
Material Terms of Trading Arrangement		On August 31, 2023, Michael Sturmer, our President, adopted a trading plan that is intended to satisfy the conditions under Rule 10b5-1(c) of the Exchange Act. Mr. Sturmer's trading plan is for the sale of up to approximately 176,880 shares of the Company's common stock, including upon the vesting and settlement of certain equity awards, in amounts and prices determined in accordance with a formula set forth in the plan. Because the aggregate number of shares that may be sold under the Mr. Sturmer's plan will be net of shares withheld by the Company to satisfy Mr. Sturmer's tax obligations upon the vesting and settlement of certain equity awards, the precise number of shares that may be sold under Mr. Sturmer's trading plan is not yet determinable. The plan terminates on the earlier of the date all shares under the plan are sold or August 23, 2024.
Name	Michael Sturmer
Title	President
Rule 10b5-1 Arrangement Adopted	true
Adoption Date	August 31, 2023
Arrangement Duration	266 days
Aggregate Available	176,880	176,880

Significant Accounting Polici_2

Significant Accounting Policies (Policies)	9 Months Ended
	Sep. 30, 2023
Accounting Policies [Abstract]
Basis of Presentation	Basis of Presentation The accompanying interim unaudited consolidated financial statements include the accounts of Progyny, Inc. and its wholly owned subsidiaries. The interim unaudited consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”) applicable to interim financial reporting. These interim consolidated financial statements have been prepared on a basis consistent with the annual consolidated financial statements and, in the opinion of management, include all adjustments necessary to fairly state the Company's financial position as of September 30, 2023, the results of the Company's operations for the three and nine months ended September 30, 2023 and 2022 and the results of the Company's cash flows for the nine months ended September 30, 2023 and 2022. Therefore, these unaudited consolidated financial statements should be read in conjunction with the audited consolidated financial statements and related footnotes included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2022, filed with the SEC on March 1, 2023 (the “Annual Report on Form 10-K”). The results for the three and nine months ended September 30, 2023 are not necessarily indicative of the operating results expected for the year ending December 31, 2023 or any other future period. Additionally, the coronavirus ("COVID-19") pandemic continues to evolve and due to the uncertainty of the pandemic, including variants, the Company's customers and members, provider network, specialty pharmacy partners, employees, suppliers, vendors, and other business partners may continue to be impacted in future periods. A resurgence of COVID-19 could have a material adverse effect on the Company’s business, financial condition, results of operations and growth prospects. The Company will continue to assess these potential impacts to its business and will make adjustments to its operations as necessary.
Use of Estimates	Use of Estimates The preparation of consolidated financial statements in conformity with U.S. GAAP generally requires management to make estimates and assumptions that affect the reported amount of certain assets, liabilities, revenue, and expenses, and the related disclosure of contingent assets and liabilities. Such estimates include, but are not limited to, the determination of accrued receivables related to revenue recognition, accrued claims payable, allowance for doubtful accounts, stock-based compensation expense, lease liabilities, and accounting for income taxes. Management bases its
Revenue Recognition	Revenue Recognition Revenue is recognized when control of the promised goods or services is transferred to clients in an amount that reflects the consideration the Company expects to be entitled to in exchange for those goods or services. The Company applies the following five-step model to recognize revenue from contracts with clients: • Identification of the contract, or contracts, with a client; • Identification of the performance obligations in the contract; • Determination of the transaction price; • Allocation of the transaction price to the performance obligations in the contract; and • Recognition of revenue when, or as, a performance obligation is satisfied. Progyny’s contracts typically have a stated term of three years and include contractual termination options after the first year, allowing the client to terminate the contract with 30 to 90 days’ notice. Fertility Benefits Solution Revenue Progyny primarily generates revenue through its fertility benefits solution, in which Progyny provides self-insured enterprise entities (“clients”) and their employees and partners (together, “members”) with fertility benefits. As part of the fertility benefits solution, Progyny provides access to effective and cost-efficient fertility treatments, referred to as Smart Cycles, as well as other related services. Smart Cycles are proprietary treatment bundles that include certain medical services available to members through Progyny’s proprietary, credentialed network of provider clinics. In addition to access to Progyny’s Smart Cycle treatment bundles and access to Progyny’s network of provider clinics, the fertility benefits solution includes other comprehensive services, which Progyny refers to as care management services, such as active management of the provider clinic network, real-time member eligibility and treatment authorization, member-facing digital tools throughout the Smart Cycle and detailed quarterly reporting all supported by client facing account management and end-to-end comprehensive member support provided by Progyny’s in house staff of PCAs. The promises within Progyny’s fertility benefits contract with a client represent a single performance obligation because Progyny provides a significant service of integrating the Progyny designed Smart Cycles and access to the fertility treatment services provided by provider clinics with the other comprehensive services into the combined fertility benefits solution that the client contracted to receive. Progyny’s fertility benefits solution is a stand-ready obligation that is satisfied over the contract term. Progyny’s contracts include the following sources of consideration, which are all variable: a per employee per month (“PEPM”) administration fee (in most, but not all contracts) and a fixed rate per Smart Cycle. The PEPM administration fee is allocated between the fertility benefits solution and the pharmacy benefits solution based on standalone selling price, estimated using an expected cost-plus margin method. The Company allocates the variable consideration related to the fixed rate per Smart Cycle to the distinct period during which the related services were performed as those fees relate specifically to the Company’s efforts to provide its fertility benefits solution to its clients in the period and represents the consideration the Company is entitled to for the fertility benefits services provided. As a result, the fixed rate per Smart Cycle is included in the transaction price and recognized in the period in which the Smart Cycle is provided to the member. Progyny’s contracts also include potential service level agreement refunds related to outcome-based service metrics. These service level refunds, which are determined based on results of a full plan year, if met, are based on a percentage of the PEPM fee paid by clients. The Company estimates the variable consideration related to the total PEPM administration fee, less estimated refunds related to service level agreements, and recognizes the amounts allocated to the fertility benefits solution ratably over the contract term. Progyny’s estimates of service level agreement refunds have not historically resulted in significant adjustments to the transaction price. Clients are typically invoiced on a monthly basis for the PEPM administration fee. Progyny invoices its clients and members for their respective portions of the fixed rate per Smart Cycle bundle when all treatment services within a Smart Cycle are completed by the provider clinic. Once an invoice is issued, payment terms are typically between 30 to 60 days. The Company assesses whether it is the principal or the agent for each arrangement with a client, since fertility treatment services are provided by a third party—the provider clinics. The Company is the principal in its arrangements with clients and therefore presents revenue gross of the amounts paid to the provider clinics because Progyny controls the specified service (the fertility benefits solution) before it is transferred to the client. Progyny integrates the fertility treatment services provided by the provider clinics into the overall fertility benefits solution that the client contracted to receive. In addition, Progyny defines the scope of the potential services to be performed by the provider clinics and monitors the performance of the provider clinics. Furthermore, Progyny is primarily responsible for fulfilling the promise to the client and has discretion in setting the pricing, as Progyny separately negotiates agreements with the provider clinics, which establish pricing for each treatment service. Pricing of services from provider clinics is independent from the fees charged to clients. Pharmacy Benefits Solution Revenue For clients that have the fertility benefits solution, Progyny offers, as an add-on, its pharmacy benefits solution, which is a separate, fully integrated pharmacy benefit. As part of the pharmacy benefits solution, Progyny provides care management services, which include Progyny’s formulary plan design, prescription fulfillment, simplified authorization and timely delivery of the medications used during treatment through Progyny’s network of specialty pharmacies, and clinical services consisting of member assessments, UnPack It calls, telephone support, online education, medication administration training, pharmacy support services and continuing PCA support. The pharmacy-related promises represent a single performance obligation because Progyny provides a significant service of integrating the formulary plan design, prescription fulfillment, clinical services and PCA support into the combined pharmacy benefits solution that the client contracted to receive. The pharmacy benefits solution is a stand-ready obligation that is satisfied over the contract term. Progyny’s contracts include the following sources of consideration, all of which are variable: a PEPM administration fee (in most, but not all contracts) and a fixed fee per fertility drug. As described above, the PEPM administration fee, less estimated refunds related to service level agreements, is allocated to the pharmacy benefits solution and recognized ratably over the contract term. The Company allocates the variable consideration related to the fixed fee per fertility drug to the distinct period during which the related services were performed, as those fees relate specifically to the Company’s efforts to provide its pharmacy benefits solution to clients in the period and represents the consideration the Company is entitled to for the pharmacy benefits services provided. As a result, the fixed fee per fertility drug is included in the transaction price and recognized in the period in which the Company is entitled to consideration from a client, which is when a prescription is filled and delivered to the members. As stated above, clients are invoiced on a monthly basis for the PEPM administration fee. Progyny invoices the client and the member for their respective portions of the fixed fee per fertility drug, when the prescription services are completed by the specialty pharmacies. Once an invoice is issued, payment terms are typically between 30 to 60 days. The Company assesses whether it is the principal or the agent for each arrangement with a client, as prescription fulfillment and clinical services are provided by a third party—the specialty pharmacies. The Company is the principal in its arrangements with clients, and therefore presents revenue gross of the amounts paid to the specialty pharmacies. Progyny controls the specified service (the pharmacy benefits solution) before it is transferred to the client. Progyny integrates the prescription fulfillment and clinical services provided by the pharmacies and PCAs into the overall pharmacy benefits solution that the client contracted to receive. In addition, Progyny defines the scope of the potential services to be performed by the specialty pharmacies and monitors the performance of the specialty pharmacies. Furthermore, Progyny is primarily responsible for fulfilling the promise to the client and has discretion in setting the pricing, as Progyny separately negotiates agreements with pharmacies, which establish pricing for each drug. Pricing of fertility drugs is independent from the fees charged to clients. The Company does not disclose the transaction price allocated to remaining performance obligations because all of the transaction price is variable and is allocated to the distinct periods to which the services relate, as discussed above. The remaining contract term is typically less than one year, due to the client’s contractual termination options. There were no material contract asset or contract liability balances as of September 30, 2023 and December 31, 2022.
Accrued Receivables and Accrued Claims Payable	Accrued Receivables and Accrued Claims Payable Accrued receivables are estimated based on historical experience for those fertility benefits services provided but for which a claim has not been received from the provider clinic at the end of the reporting period, which includes assumptions regarding the lag between authorization date and service date as well as estimates for changes and cancellations of services. At the same time, cost of services and accrued claims payables are estimated based on the amount to be paid to the provider clinic and expected gross margin on fertility benefits services. Estimates are adjusted to actual at the time of billing. Adjustments to original estimates have not been material. As of September 30, 2023 and December 31, 2022, accrued receivables were $63.7 million and $54.6 million, respectively. Accrued receivables are included within accounts receivable in the consolidated balance sheet. Accrued claims payable of $37.1 million and $31.1 million as of September 30, 2023 and December 31, 2022, respectively, are included within accrued expenses and other current liabilities in the consolidated balance sheet. Claims payable are generally paid within 30 days based on contractual terms. As of September 30, 2023 and December 31, 2022, unbilled receivables, which represent claims received and approved but unbilled at the end of the reporting period, were $49.4 million and $42.9 million, respectively. Unbilled receivables are typically billed to clients within 30 days of the approved claim based on the contractual billing schedule agreed upon with the client. Unbilled receivables are included in accounts receivable in the consolidated balance sheet.
Accounts Receivable and Allowance for Doubtful Accounts	Accounts Receivable and Allowance for Doubtful Accounts The accounts receivable balance primarily includes amounts due from clients and members. The Company estimates the allowance for doubtful accounts based on the lifetime expected credit losses for the client and member receivable pools, respectively. Under this current expected credit losses model, the Company determines the allowance for doubtful accounts based on factors such as the age of the receivable balance, historical experience, current economic conditions, and reasonable and supportable forecasts of future economic conditions. An allowance for credit losses is applied at the time the asset is recognized. Expected credit losses are recorded as general and administrative expenses on the consolidated statements of operations.
Cost of Services	Cost of Services Fertility Benefits Services Fertility benefits services costs include: (1) fees paid to provider clinics within the Company’s network, labs and anesthesiologists; (2) costs incurred (including salaries, bonuses, benefits, stock-based compensation expense, other related costs, and an allocation of the Company's general overhead, depreciation and amortization) for those employees associated with care management service functions: Provider Account Management, PCA, Provider Relations and Claims Processing teams; and (3) related information technology support costs. Contracts with provider clinics are typically for a term of one Pharmacy Benefits Services Pharmacy benefits services costs include: (1) the fees for prescription drugs dispensed and clinical services provided during the reporting period by specialty pharmacy partners; (2) costs incurred (including salaries, bonuses, benefits, stock-based compensation expense, other related costs, and an allocation of the Company's general overhead, depreciation and amortization) for those employees associated with care management service functions: PCA, Provider Relations and Claims Processing teams; and (3) related information technology support costs. Contracts with the specialty pharmacies are typically for a term of one year. In the specialty pharmacy contracts, the contractual fees of prescription drugs sold includes the cost of the prescription drugs purchased and shipped to members by the Company’s specialty mail service dispensing pharmacies, net of any volume-related or other discounts. Vendor Rebates The Company receives a rebate on formulations purchased and dispensed by the Company’s specialty pharmacies. The Company’s contractual arrangements with pharmacy program partners provide for the Company to receive a discount (or rebate) from established list prices paid subsequent to dispensing when products are purchased indirectly from a pharmacy program partners (such as through a specialty pharmacy). These rebates are recognized as a reduction of cost of services when prescriptions are dispensed and are generally estimated and billed to manufacturers within 20 days after the end of each month. The effect of adjustments resulting from the reconciliation of rebates recognized to the amounts billed and collected has not been material to the Company’s results of operations.
Recently Adopted Accounting Pronouncements	Recently Adopted Accounting Pronouncements In May 2021, the FASB issued ASU No. 2021-04 (“ASU 2021-04”) “ Earnings Per Share (Topic 260), Debt-Modifications and Extinguishments (Subtopic 470-50), Compensation- Stock Compensation (Topic 718), and Derivatives and Hedging-Contracts in Entity’s Own Equity (Subtopic 815- 40) ” which provides guidance on modifications or exchanges of a freestanding equity-classified written call options that are not within the scope of another Topic, such as warrants. The Company adopted this standard as of January 1, 2022 on a prospective basis to modifications or exchanges occurring on or after this date. The adoption of this standard did not have a material impact on the Company’s consolidated financial statements.

Significant Accounting Polici_3

Significant Accounting Policies (Tables)	9 Months Ended
	Sep. 30, 2023
Accounting Policies [Abstract]
Schedule of Accounts Receivable and Allowance for Doubtful Accounts	The following table provides a summary of the activity in this allowance (in thousands): Nine Months Ended September 30, 2023 Balance at Beginning of Period Charged to Costs and Expenses Write-offs Balance at End of Period Allowance for doubtful accounts $ 28,328 $ 15,062 $ (494) $ 42,896

Revenue (Tables)

Revenue (Tables)	9 Months Ended
	Sep. 30, 2023
Revenue from Contract with Customer [Abstract]
Schedule of Disaggregation of Revenue	The following table disaggregates revenue by service (in thousands): Three Months Ended Nine Months Ended 2023 2022 2023 2022 Fertility benefits services revenue $ 175,110 $ 129,301 $ 504,993 $ 367,009 Pharmacy benefits services revenue 105,781 76,070 313,665 205,583 Total revenue $ 280,891 $ 205,371 $ 818,658 $ 572,592

Leases (Tables)

Leases (Tables)	9 Months Ended
	Sep. 30, 2023
Leases [Abstract]
Schedule of Lease Information	Information related to the Company's leases is as follows (in thousands): Balance Sheet Location September 30, 2023 December 31, 2022 Operating Leases Right-of-use asset Operating lease right-of-use assets $ 18,028 $ 6,903 Short-term lease liabilities Accrued expenses and other current liabilities $ 1,790 $ 1,231 Long-term lease liabilities Operating lease noncurrent liabilities $ 17,700 $ 6,482 Other information Weighted-average remaining lease term, operating lease 9.8 years 6.4 years Weighted-average discount rate, operating lease 4.59% 4.29%
Schedule of Future Minimum Facility Lease Payments	Future minimum facility lease payments related to the Company's operating lease liabilities as of September 30, 2023 were as follows (in thousands): Year Ending December 31: Operating Lease Payments as of September 30, 2023 2023 $ 321 2024 2,250 2025 2,793 2026 2,793 2027 2,793 Thereafter 13,641 Total undiscounted lease payments $ 24,591 Less: imputed interest 5,101 Present value of lease liabilities $ 19,490 Less: current portion of operating lease liabilities 1,790 Operating lease noncurrent liabilities $ 17,700

Stock-based Compensation Expe_2

Stock-based Compensation Expense (Tables)	9 Months Ended
	Sep. 30, 2023
Share-Based Payment Arrangement [Abstract]
Schedule of Stock Based Compensation Expense for Employees	The following table summarizes stock-based compensation expense, which was included in the statements of operations as follows (in thousands): Three Months Ended Nine Months Ended 2023 2022 2023 2022 Cost of services $ 8,941 $ 6,268 $ 25,967 $ 18,603 Sales and marketing 6,938 5,184 20,389 15,026 General and administrative 15,372 11,845 47,456 37,822 Total stock-based compensation expense $ 31,251 $ 23,297 $ 93,812 $ 71,451

Net Income Per Share (Tables)

Net Income Per Share (Tables)	9 Months Ended
	Sep. 30, 2023
Earnings Per Share [Abstract]
Schedule of Earnings Per Share, Basic and Diluted	A reconciliation of net income and the number of shares in the calculation of basic and diluted net income per share is as follows (in thousands, except share and per share amounts): Three Months Ended Nine Months Ended 2023 2022 2023 2022 Basic net income per common share: Numerator: Net income $ 15,898 $ 13,211 $ 48,567 $ 26,950 Denominator: Weighted-average shares used in computing basic net income per share 95,502,250 92,316,022 94,698,616 91,901,778 Basic net income per share $ 0.17 $ 0.14 $ 0.51 $ 0.29 Diluted net income per common share: Numerator: Net income $ 15,898 $ 13,211 $ 48,567 $ 26,950 Denominator: Weighted-average shares used in computing basic net income per share 95,502,250 92,316,022 94,698,616 91,901,778 Effect of dilutive securities 5,377,326 7,503,779 5,854,089 7,963,588 Weighted-average shares used in computing diluted net income per share 100,879,576 99,819,801 100,552,705 99,865,366 Diluted net income per share $ 0.16 $ 0.13 $ 0.48 $ 0.27
Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share	The following weighted-average outstanding shares of potentially dilutive securities were excluded from the computation of diluted income per share for the period presented because including them would have been antidilutive: Three Months Ended Nine Months Ended 2023 2022 2023 2022 Options to purchase common stock 11,988,899 7,184,651 11,887,706 7,159,982 Shares issuable under employee stock purchase plan — — 1,589 — Restricted stock units 986,798 1,627,946 1,045,151 1,928,378 Total 12,975,697 8,812,597 12,934,446 9,088,360

Business and Basis of Present_2

Business and Basis of Presentation (Details)	9 Months Ended
	Sep. 30, 2023 segment
Segment Reporting, Disclosure of Entity's Reportable Segments [Abstract]
Number of operating segments	1

Significant Accounting Polici_4

Significant Accounting Policies - Narrative (Details) - USD ($) $ in Millions	9 Months Ended
	Sep. 30, 2023	Dec. 31, 2022
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Revenue from contract with customer, term (in years)	3 years
Remaining contract term related to remaining performance obligations (in years)	1 year
Accrued receivables	$ 63.7	$ 54.6
Accrued claims payable	$ 37.1	31.1
Claims payable, payment period (within)	30 days
Unbilled receivables	$ 49.4	$ 42.9
Period in which unbilled receivables are billed to clients (within)	30 days
Contract term with specialty pharmacies (in years)	1 year
Billing terms (in days)	20 days
Minimum
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Revenue contract termination, notice period (in days)	30 days
Customer payment terms (in days)	30 days
Contract term, clinics (in years)	1 year
Maximum
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Revenue contract termination, notice period (in days)	90 days
Customer payment terms (in days)	60 days
Contract term, clinics (in years)	2 years

Significant Accounting Polici_5

Significant Accounting Policies - Allowance for Doubtful Accounts (Details) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022
Accounts Receivable, Allowance for Credit Loss [Roll Forward]
Balance at beginning of period	$ 28,328
Charged to Costs and Expenses	15,062	$ 9,685
Write-offs	(494)
Balance at end of period	$ 42,896

Revenue (Details)

Revenue (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022
Revenues [Abstract]
Total revenue	$ 280,891	$ 205,371	$ 818,658	$ 572,592
Fertility benefits services revenue
Revenues [Abstract]
Total revenue	175,110	129,301	504,993	367,009
Pharmacy benefits services revenue
Revenues [Abstract]
Total revenue	$ 105,781	$ 76,070	$ 313,665	$ 205,583

Fair Value of Financial Instr_2

Fair Value of Financial Instruments (Details) - Fair value, recurring - USD ($)	Sep. 30, 2023	Dec. 31, 2022
Level 1
Assets, Fair Value Disclosure [Abstract]
Financial assets held in marketable securities	$ 205,300,000	$ 69,200,000
Level 2
Assets, Fair Value Disclosure [Abstract]
Assets classified as level 2 or level 3, fair value	0	0
Liabilities classified as level 2 or level 3, fair value	0	0
Level 3
Assets, Fair Value Disclosure [Abstract]
Assets classified as level 2 or level 3, fair value	0	0
Liabilities classified as level 2 or level 3, fair value	0	0
Money market funds | Level 1
Assets, Fair Value Disclosure [Abstract]
Financial assets held in money market accounts	$ 64,100,000	$ 120,600,000

Leases - Narrative (Details)

Leases - Narrative (Details) $ in Thousands

3 Months Ended

9 Months Ended

Oct. 01, 2025 USD ($)

Sep. 30, 2023 USD ($)

Sep. 30, 2022 USD ($)

Sep. 30, 2023 USD ($)

Sep. 30, 2022 USD ($)

Mar. 31, 2030 USD ($)

Jun. 30, 2029 USD ($)

Apr. 01, 2029 USD ($)

Apr. 01, 2024 USD ($)

Feb. 28, 2023 USD ($) ft²

Dec. 31, 2022 USD ($)

Feb. 28, 2022 ft²

Sep. 30, 2019 ft²

Lessee, Operating Lease, Description [Abstract]

Operating lease right-of-use assets

$ 18,028

$ 18,028

$ 6,903

Present value of lease liabilities

19,490

19,490

Lease expense

700

$ 300

1,700

$ 900

Cash outflows from operating activities attributable to operating leases

1,000

$ 1,000

Corporate Headquarters Lease, New York, New York, September 2019

Lessee, Operating Lease, Description [Abstract]

Leased area (in square feet) | ft²

25,212

Corporate Headquarters Lease, New York, New York, September 2019 | Forecast

Lessee, Operating Lease, Description [Abstract]

Operating lease, base rent per annum

$ 1,600

Corporate Headquarters Lease, New York, New York, September 2019 | Through fifth lease year

Lessee, Operating Lease, Description [Abstract]

Operating lease, base rent per annum

1,300

1,300

Corporate Headquarters Lease, New York, New York, September 2019 | After fifth lease year

Lessee, Operating Lease, Description [Abstract]

Operating lease, base rent per annum

$ 1,400

$ 1,400

Corporate Headquarters Lease, New York, New York, February 2023

Lessee, Operating Lease, Description [Abstract]

Leased area (in square feet) | ft²

24,099

Operating lease right-of-use assets

$ 12,200

Present value of lease liabilities

$ 12,100

Corporate Headquarters Lease, New York, New York, February 2023 | Forecast

Lessee, Operating Lease, Description [Abstract]

Operating lease, base rent per annum

$ 1,500

$ 1,400

Corporate Offices Lease Two, New York, New York, Commencing 2024

Lessee, Operating Lease, Description [Abstract]

Leased area (in square feet) | ft²

21,262

Corporate Offices Lease Two, New York, New York, Commencing 2024 | Forecast

Lessee, Operating Lease, Description [Abstract]

Operating lease, base rent per annum

$ 1,300

$ 1,400

Operating lease, base rent per annum, first term, period (in years)

5 years

Leases - Operating Leases and O

Leases - Operating Leases and Other Information (Details) - USD ($) $ in Thousands	Sep. 30, 2023	Dec. 31, 2022
Assets and Liabilities, Lessee [Abstract]
Right-of-use asset	$ 18,028	$ 6,903
Short-term lease liabilities	$ 1,790	$ 1,231
Operating Lease, Liability, Current, Statement of Financial Position [Extensible Enumeration]	Accrued expenses and other current liabilities	Accrued expenses and other current liabilities
Long-term lease liabilities	$ 17,700	$ 6,482
Lessee Disclosure [Abstract]
Weighted average remaining lease term, operating lease (in years)	9 years 9 months 18 days	6 years 4 months 24 days
Weighted-average discount rate, operating lease	4.59%	4.29%

Leases - Future Minimum Lease P

Leases - Future Minimum Lease Payments (Details) - USD ($) $ in Thousands	Sep. 30, 2023	Dec. 31, 2022
Lessee, Operating Lease, Liability, Payment, Due [Abstract]
2023	$ 321
2024	2,250
2025	2,793
2026	2,793
2027	2,793
Thereafter	13,641
Total undiscounted lease payments	24,591
Less: imputed interest	5,101
Present value of lease liabilities	19,490
Less: current portion of operating lease liabilities	1,790	$ 1,231
Operating lease noncurrent liabilities	$ 17,700	$ 6,482

Stock-based Compensation Expe_3

Stock-based Compensation Expense (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022
Share-based Payment Arrangement, Additional Disclosure [Abstract]
Total stock-based compensation expense	$ 31,251	$ 23,297	$ 93,812	$ 71,451
Cost of services
Share-based Payment Arrangement, Additional Disclosure [Abstract]
Total stock-based compensation expense	8,941	6,268	25,967	18,603
Sales and marketing
Share-based Payment Arrangement, Additional Disclosure [Abstract]
Total stock-based compensation expense	6,938	5,184	20,389	15,026
General and administrative
Share-based Payment Arrangement, Additional Disclosure [Abstract]
Total stock-based compensation expense	$ 15,372	$ 11,845	$ 47,456	$ 37,822

Income Taxes (Details)

Income Taxes (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022
Income Tax Disclosure [Abstract]
Provision (benefit) for incomes taxes	$ 5,033	$ (1,672)	$ 5,862	$ (6,650)

Net Income Per Share - Reconcil

Net Income Per Share - Reconciliation (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022
Numerator:
Net income	$ 15,898	$ 13,211	$ 48,567	$ 26,950
Denominator:
Weighted-average shares used in computing basic net income per share (in shares)	95,502,250	92,316,022	94,698,616	91,901,778
Basic net income per share (in dollars per share)	$ 0.17	$ 0.14	$ 0.51	$ 0.29
Numerator:
Net income	$ 15,898	$ 13,211	$ 48,567	$ 26,950
Denominator:
Weighted-average shares used in computing basic net income per share (in shares)	95,502,250	92,316,022	94,698,616	91,901,778
Effect of dilutive securities (in shares)	5,377,326	7,503,779	5,854,089	7,963,588
Weighted-average shares used in computing diluted net income per share (in shares)	100,879,576	99,819,801	100,552,705	99,865,366
Diluted net income per share (in dollars per share)	$ 0.16	$ 0.13	$ 0.48	$ 0.27

Net Income Per Share - Potentia

Net Income Per Share - Potentially Dilutive Securities (Details) - shares	3 Months Ended		9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Total (in shares)	12,975,697	8,812,597	12,934,446	9,088,360
Options to purchase common stock
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Total (in shares)	11,988,899	7,184,651	11,887,706	7,159,982
Shares issuable under employee stock purchase plan
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Total (in shares)	0	0	1,589	0
Restricted stock units
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Total (in shares)	986,798	1,627,946	1,045,151	1,928,378