Progyny released an 8-K after hours. In it, the firm spoke about losing a client for 2025 worth 12% of its total revenue. I’m pretty sure it was Amazon, based on the size of the membership hit. If so, this could also potentially mean Amazon is entering the fertility space, like it has done in so many other areas of healthcare. That’s speculation. What isn’t speculation is that this makes assumed 2025 multiples inaccurate and creates a new churn risk that hasn’t existed before for this company.

Those of you know that I’ve been very disappointed with this holding for nearly a year. Constant hiccups, strange headwinds and excuses have held this company back consistently. Its value proposition is too good for these issues to continue to creep up. So something appears to be off. There’s a disconnect here that is becoming too structural in nature.

I was patient after the first disastrous guide down due to drug mix-shift and Supreme Court rulings. I was patient as that got resolved, yet another inexplicable revenue per cycle headwind popped up. Throughout that time, as you know, I took the position off of my accumulate list, cut about 60% of it and let it shrink in overall sizing. Well? This is 3 strikes in the span of 9 months. I’ve run out of patience and will exit this name tomorrow morning. I’ve fully lost trust in the team and anything it has to say. I look across the portfolio and see everything else performing significantly better; I cannot be unconditionally loyal to any holding. At the end of the day, this is about making money and continuing to outperform the S&P 500. Progyny no longer fits within those objectives.

Time for me to move on from this name and focus on companies deserving my time and attention. I wish the company the best of luck and hope it finds success, as that would mean better outcomes for the fertility industry.

I plan to keep the proceeds in cash for now (about 3% of holdings).