DocGo's Q3 2025 Earnings: Navigating Short-Term Pain for Long-Term Gain

DocGo Inc. (NASDAQ: DCGO) delivered a Q3 2025 earnings report that underscored the tension between short-term financial pressures and long-term strategic momentum. While the company missed earnings expectations and faced a 49% year-over-year revenue decline, its operational performance in core business lines and the acquisition of SteadyMD suggest a recalibration toward sustainable growth. Investors must weigh these dynamics to assess whether the current challenges are transient or indicative of deeper structural issues.

Earnings Miss and Revenue Decline: A Temporary Setback

DocGo's Q3 2025 results were marred by a significant earnings per share (EPS) miss of -$0.28, far below the forecasted -$0.12, and a revenue drop to $70.8 million from $138.7 million in Q3 2024, as reported in the earnings call transcript. The decline was primarily attributed to the wind-down of migrant-related services, which contributed just $8.4 million in Q3 2025 compared to $80.7 million in the prior-year period, according to the press release. Excluding this one-time factor, core business revenue grew by 8% year-over-year, reaching $62.4 million, as reported in the press release. This divergence highlights the company's strategic pivot away from volatile, short-term contracts toward more stable, scalable operations.

Operational Strengths: Core Businesses Gain Momentum

Despite the headline negatives, DocGo's core business lines-care gap closure, medical transportation, and mobile phlebotomy-showed resilience. The care gap closure and transitions of care segment, in particular, saw a 320% surge in service volumes compared to Q3 2024, as reported in the press release. This growth reflects the company's ability to leverage its technology and mobile infrastructure to address gaps in preventive care, a critical need in an aging healthcare landscape.

Medical transportation services also demonstrated steady progress, with revenue rising 4.4% to $50.1 million in Q3 2025, according to the press release. While modest, this growth underscores the segment's role as a consistent cash flow generator. Meanwhile, mobile phlebotomy remains a key area of focus, though specific growth metrics remain undisclosed, as noted in a Yahoo Finance article. The lack of granular data here is a limitation, but the broader trend of increased demand for at-home diagnostic services suggests untapped potential.

Strategic Acquisition of SteadyMD: A Game Changer

DocGo's acquisition of SteadyMD-a virtual care platform with 600 clinicians and a projected 3 million patient reach in 2025-has redefined its strategic trajectory, as reported in a Parameter article. The deal, funded entirely by existing cash reserves, is expected to add $25 million in 2025 revenue and achieve EBITDA profitability by 2026, according to the Parameter article. This acquisition not only diversifies DocGo's service offerings but also positions it to capitalize on the $100 billion virtual care market, which is expanding rapidly due to post-pandemic consumer preferences and regulatory tailwinds, as noted in the Parameter article.

The integration of SteadyMD's leadership team into DocGo's operations further strengthens its execution potential. Co-founders Guy Friedman and Yarone Goren, now part of the company's executive ranks, bring expertise in scaling telehealth platforms-a critical asset as DocGo seeks to streamline its digital health ecosystem, as noted in the Parameter article.

Financial Guidance and Forward-Looking Outlook

DocGo's revised 2025 revenue guidance of $315–320 million and 2026 projections of $280–300 million reflect cautious optimism, as reported in a Chartmill article. While the 2026 range is lower than 2025, it accounts for the expected phase-out of migrant-related services and the ramp-up period for SteadyMD's contributions. The company's emphasis on "value-based care" and "operational efficiency" in its earnings call transcript signals a shift toward profitability through higher-margin services, as noted in the earnings call transcript.

However, challenges remain. The CEO acknowledged that care gap closure and transitions of care still require heavy investment in technology and training, which could delay profitability, as noted in the earnings call transcript. Investors must monitor whether these investments translate into sustainable margins or become a drag on cash flow.

Conclusion: A Calculated Bet on Healthcare's Future

DocGo's Q3 2025 earnings highlight a company in transition. While short-term revenue declines and an EPS miss are concerning, the growth in core business lines and the SteadyMD acquisition provide a compelling long-term narrative. The key question is whether the company can balance its capital expenditures with revenue diversification to achieve profitability by 2026. For investors with a multi-year horizon, DocGo's strategic repositioning in virtual care and value-based services may justify the current volatility.