GDRX

GoodRx has finally crossed into durable profitability — FY2025 net income of $30.4M (+85.7% YoY) on operating income of $87.5M (11.0% operating margin) caps a three-year turn from a -$8.87M loss in FY2023. The real story is cash: $168M of operating cash flow against just $3.52M of capex implies roughly $164M of free cash flow, a high-teens FCF yield on the $1.02B market cap. Management is funneling that into the share count, repurchasing $216M of stock and shrinking weighted shares 7.6% YoY. On earnings the stock screens full (P/E 31.7), but on cash flow it is genuinely inexpensive, and the buyback is doing the heavy lifting on per-share value.

The problem is the top line and what's pressuring it. Revenue was essentially flat (+0.6% to $797M) and has barely moved in four years ($745M in FY2021 to $797M in FY2025). The MD&A is candid that this stagnation is structural, not cyclical: Rite Aid's bankruptcy and removal from PBM networks caused 'immediate cessation' of claims volume, pharmacies and PBMs are renegotiating reimbursement, and a 'material volume reduction' hit one integrated savings program. Management quantifies the combined drag at $35.0M–$40.0M to prescription transactions revenue and expects it 'will continue in the near term.' That is the foundational business eroding while the company pivots to pharma direct and condition-specific subscriptions (ED, hair loss, GLP-1 weight loss) — offerings management itself flags as unproven against its 'limited operating history.'