STLN

MKT CAP $696.1MP/E —DIV YIELD —FCF YIELD -0.47%REV TTM $587.2M +38.4%NET INCOME −$36.3MNET DEBT $79.8M52W 2.38 – 7.05SEC XBRL · TTM TO Invalid Date

How STLN rewrote its risk factors

10-K ITEM 1A · FY2024 → FY2025

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New in FY2025

The risks and uncertainties described below reflect the Company’s beliefs and opinions as to matters that could materially and adversely affect the Company and its securities in the future.
References to past events are provided by way of example only and are not intended to be a complete listing or a representation as to whether or not such factors have occurred in the past or their likelihood of occurring in the future.
Our business strategy is to grow rapidly by expanding our network of oncology care clinics and is significantly dependent on our ability to open new TOI PC clinics in our existing markets, expand into new geographical locations through existing TOI PCs or affiliating with new professional entities that would become a TOI PC, recruit new patients and partner or contract with payors, existing medical practices or other healthcare providers to provide oncology care services.
We incurred a net loss of $60,606,000 in 2025, and a loss from operations $36,083,000 in 2025.
As of December 31, 2025, the vast majority of the TOI PC members under capitation agreements were residents of California.
The Centers for Medicare and Medicaid Services, or CMS, the federal agency responsible for administering the Medicare program has made several changes in the manner in which Medicare will pay for telehealth visits, many of which relax previous requirements, including site requirements for both the providers and patients, telehealth modality requirements and others.
Medicare patients can receive services at home without restriction through December 31, 2027 .
State law applicable to telehealth, particularly licensure requirements, were also relaxed in many jurisdictions during the Covid emergency.
It is unclear how long any of these changes will remain in place, if at all.
If regulations change to restrict the TOI PCs’ or our affiliated providers ability to deliver care through telehealth or remote modalities, our financial condition and results of operations may be adversely affected.
Approximately 16% of our revenue for 2025 was derived from fixed fees paid by payors under capitation agreements with the TOI PCs.
No non-government payor accounted for more than 10% of the Patient Services revenue in 2025.
The TOI PCs receive a significant portion of revenue directly from Medicare, which accounted for approximately 14% of our Patient Services revenue in 2025.
Further, fluctuation in Medicare Advantage payment rates are evidenced by CMS’s annual announcement of the expected average change in revenue from the prior year: for 2025, CMS announced an average increase of 3.70%; and for 2026, 3.26%.
In 2025, the KFF reported that two payors together accounted for nearly half of Medicare Advantage enrollment and seven firms accounted for nearly 85% of covered lives.
At the federal level, the Trump administration has significantly reduced Medicaid funding.
On July 4, 2025, President Trump signed the 2025 budget reconciliation legislation, known as the “One Big Beautiful Bill Act,” which imposes new administrative requirements and conditions on Medicaid eligibility and funding, increases costs and premiums for certain beneficiaries, and imposes new limitations on states’ abilities to fund programs.
These measures are expected to result in a substantial reduction in funding for Medi-Cal, a reduction in coverage eligibility and an increase in the number of uninsured.
As a result of these changes to the Medicaid program, the TOI PCs could experience a reduction in membership, which could have a material adverse effect on our business, results of operations, financial condition and cash flows.
Under the Trump Administration there have been various administrative actions to reduce access and coverage under the ACA, including shorter enrollment periods, stricter verification, and eliminating tax credits for many immigrants.
However, the ACA continues to face uncertainty.
The Trump administration has signaled its intent to revisit certain ACA policies and has taken executive actions affecting the law's implementation.
Among other things, the administration has reduced funding for ACA marketplace outreach and navigator programs, shortened open enrollment periods, increased the availability of high-deductible/catastrophic plans, and opposed extending enhanced premium tax credits aimed at reducing premium costs.
However, the ACA marketplace premium tax credits provided by the IRA expired at the end of 2025, and Congress has not taken action to extend them.
As a result, a significant number of individuals who currently obtain insurance through the ACA marketplace may lose coverage or face substantially higher premiums, which could increase the number of uninsured.
While these provisions of the IRA do not apply directly to healthcare providers like the TOI PCs, the expiration or modifications of certain provisions in the IRA may indirectly affect our business by altering the payer mix of patients served by TOI PCs.
More recently, the Trump administration has taken actions intended to reduce the cost of prescription drugs, including drugs purchased directly by consumers.
The administration issued two Executive Orders aimed at lowering drug prices through multiple directives, including directives to government agencies and officials to identify most-favored-nation pricing targets for prescription drugs (and looking to pharmaceutical manufacturers to make significant progress towards delivering target prices to patients), to facilitate direct-to-consumer purchasing programs for pharmaceutical manufacturers to sell their products to patients at the most-favored-nation price, to enhance competition for high-cost prescription drugs by accelerating approval of generics and biosimilars, facilitating the process for re-classifying prescription drugs as OTC drugs, and increasing drug importation.
In the wake of the Executive Orders and related executive initiatives, a number of pharmaceutical manufacturers have announced new or expanded direct-to-consumer offerings with discounted prices and/or reached agreement with the federal government regarding discounted pricing for drugs, including prices for Medicaid drugs and newly launched products.
TrumpRx, a website sponsored by the federal government that offers pharmaceutical direct-to-consumer channels, also launched in February 2026.
Federal agencies are also developing and proposing new drug pricing and payment pilot programs based on international pricing metrics under Medicare Parts B and D as well as Medicaid.
Other healthcare reform efforts or actions under the Trump administration may affect prescription drug pricing, access to healthcare coverage or the funding of health care benefits, although the full impact of such efforts or actions cannot be predicted.
For example, Congressional Budget Office has estimated that Medicaid provisions in the 2025 budget reconciliation legislation known as the “One Big Beautiful Bill Act,” signed into law on July 4, 2025, including new restrictions in eligibility and funding for Medicaid, as well as changes to the healthcare marketplace, will increase the number of uninsured.
Uncertainty regarding future amendments to the ACA, new legislative proposals to reform healthcare and government insurance programs, and Trump administration initiatives aimed at increasing access to and lowering prices for prescription drugs, along with the trend toward managed healthcare in the United States, could result in reduced demand and prices for our services.
Certain health care regulations may also introduce additional reporting and compliance requirements that may adversely affect our ability to enter into strategic transactions or execute material contracts.
In California, California Assembly Bill 1415 (“AB 1415”), signed into law on October 11, 2025 and effective January 1, 2026, expanded the authority of the California Office of Health Care Affordability (“OHCA”) over health care entities and designated noticing entities, including management services organizations.
Under AB 1415, healthcare entities, noticing entities and other designated entities must provide at least 90 days’ written notice before closing certain material transactions, including any sale or transfer of a material amount of assets or a change of control.
After reviewing the information provided in the notice, OHCA has the right to conduct a more thorough cost and market impact review (“CMIR”), which could delay a transaction closing by several months.
To the extent that our management services agreements or any corporate transaction involving our California operations is deemed a material transaction subject to OHCA’s jurisdiction, we could face a lengthy notice period and may be subject to a CMIR that could materially delay or impair our ability to consummate strategic transactions, enter into new business arrangements or execute on our growth strategy.
AB 1415 also grants OHCA authority to impose data reporting requirements on management services organizations, the full scope of which remains subject to further rulemaking and regulatory guidance.

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Gone since FY2024

Our business strategy is to grow rapidly by expanding our network of oncology care clinics and is significantly dependent our ability to open new TOI PC clinics in our existing markets, expand into new geographical locations through existing TOI PCs or affiliating with new professional entities that would become a TOI PC, recruit new patients and partner or contract with payors, existing medical practices or other healthcare providers to provide oncology care services.
We incurred a net loss of $64,663,000 in 2024, and a loss from operations in 2024.
Because of our business model, the full impact of pandemic outbreaks may not be fully reflected in our results of operations and overall financial condition until future periods.
It is not currently possible to reliably project the direct impact of the COVID-19 pandemic on our operating revenues and expenses.
Key factors include the duration and extent of the outbreak in our service areas as well as societal and governmental responses.
Patients may continue to be reluctant to seek necessary care given the risks of the COVID-19 pandemic.
This could have the effect of deterring healthcare costs that we will need to incur to later periods and may also affect the health of patients who defer treatment, which may cause our costs to increase in the future.
Further, as a result of the COVID-19 pandemic, we may experience slowed growth or a decline in new patient demand.
We also may experience increased internal and third-party medical costs as the TOI PCs and our affiliated providers provide care for patients suffering from COVID-19.
This increase in costs may be particularly significant given the number of patients who are under capitation agreements.
Further, we may face increased competition due to changes to our competitors’ products and services, including modifications to their terms, conditions, and pricing that could materially adversely impact our business, results of operations, and overall financial condition in future periods.
As of December 31, 2024, the vast majority of the TOI PC members under capitation agreements were residents of California.
In addition, during 2024, approximately 85% of our revenues were generated in California.
In response to the COVID-19 pandemic, the Centers for Medicare and Medicaid Services, or CMS, the federal agency responsible for administering the Medicare program, made several changes in the manner in which Medicare will pay for telehealth visits, many of which relax previous requirements, including site requirements for both the providers and patients, telehealth modality requirements and others.
The Consolidated Appropriations Act of 2023 extended many of the COVID-19 public health emergency provisions related to telehealth until December 31, 2024 .
State law applicable to telehealth, particularly licensure requirements, has also been relaxed in many jurisdictions as a result of the COVID-19 pandemic.
It is unclear which, if any, of these changes will remain in place permanently and which will be rolled-back.
If regulations change to restrict the TOI PCs’ or our affiliated providers ability to deliver care through telehealth modalities, our financial condition and results of operations may be adversely affected.
Approximately 17% of our revenue for 2024 was derived from fixed fees paid by payors under capitation agreements with the TOI PCs.
No non-government payor accounted for more than 10% of the Patient Services revenue in 2024.
The TOI PCs receive a significant portion of revenue directly from Medicare, which accounted for approximately 16% of our Patient Services revenue in 2024.
Further, fluctuation in Medicare Advantage payment rates are evidenced by CMS’s annual announcement of the expected average change in revenue from the prior year: for 2024, CMS announced an average increase of 2.28%; and for 2025, 3.70%.
In 2024, the KFF reported that two payors together accounted for nearly half of Medicare Advantage enrollment and seven firms accounted for nearly 85% of covered lives.
As a result, the TOI PCs could experience a reduction in membership, which could have a material adverse effect on our business, results of operations, financial condition and cash flows.
Supreme Court dismissed the most recent judicial challenge to the ACA brought by several states without specifically ruling on the constitutionality of the ACA.
Prior to the Supreme Court’s decision, President Biden issued an executive order initiating a special enrollment period from February 15, 2021 through August 15, 2021 for purposes of obtaining health insurance coverage through the ACA marketplace.
The executive order also instructed certain governmental agencies to review and reconsider their existing policies and rules that limit access to healthcare.
While these provisions of the IRA do not apply directly to healthcare providers like the TOI PCs, we are continuing to evaluate the potential impact, if any, that the IRA may have on our business.
Uncertainty regarding future amendments to the ACA as well as new legislative proposals to reform healthcare and government insurance programs, along with the trend toward managed healthcare in the United States, could result in reduced demand and prices for our services.
Our Patient Services revenue accounted for approximately 52% of total revenue for the year ended December 31, 2024.
Approximately 45% of the TOI PCs’ total costs are related to drug purchases, including both oral and chemotherapy drugs, for the year ended December 31, 2024.
Although, we are confident that this recent cyberattack did not have a material adverse impact, similar cybersecurity breaches could be successfully launched in the future, and there is no assurance that such attacks will not have material adverse effect on our results of operations and cash flows.
Additionally, the Federal Trade Commission recently proposed new rules which, if enforced, would ban non-compete agreements in employee contracts.
Further, the California Privacy Rights Act, or CPRA, generally went into effect on January 1, 2023 and significantly amends the CCPA.
It will also create a new California data protection agency authorized to issue substantive regulations and could result in increased privacy and information security enforcement.
These regulations include regulations governing the TOI PCs’ dispensary services, the construction, the use of our managed clinics and the treatment of hazardous waste or drug products.
As of December 31, 2024, we had federal income tax NOLs of $184,835,785 and state income tax NOLs of $175,187,277 available to offset our future taxable income, if any, prior to consideration of annual limitations that may be imposed under Section 382 of the Code or otherwise.
We are in the process of completing an analysis to determine whether there was a change in ownership during the year ended December 31, 2024 and we do not anticipate a change in ownership during the year ended December 31, 2024.
We had $7,230,000 of goodwill recorded on our Consolidated Balance Sheets at December 31, 2024 and 2023.
Goodwill impairment charges of $0 and $16,867,000 were recorded during the years ended December 31, 2024 and 2023, respectively, based on management's evaluation of the value of goodwill.

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Sentence-level comparison of Item 1A in the two most recent 10-Ks (FY2024 ↗, FY2025 ↗). A reworded sentence counts as one dropped and one added, so heavy edits read as low “kept”. Headings and page furniture are stripped; nothing is summarised by a model.

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