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Highlights

  • AOTI shares fell 17.57% on 23 February 2026, extending yearly decline to 72.27%
  • FY2025 revenue rose 14% year-on-year to approximately USD 66.5 million (FY2024: USD 58.4 million), in line with consensus.
  • Adjusted EBITDA margin for FY2025 is expected to meet market expectations.
  • Net debt stood at around USD 6.5 million at FY2025 year-end (FY2024: net cash USD 0.9 million), reflecting higher receivables and SWK facility drawdown.
  • Arizona Medicaid contributed roughly USD 9.2 million in FY2025 revenue, but reimbursement denials lifted receivables to USD 15.6 million (FY2024: USD 8.2 million).
  • The company will stop treating new Arizona Medicaid patients from 1 April 2026 while pursuing resolution efforts.

AOTI, Inc. (LSE:AOTI) shares declined 17.57% to GBX 30.50 during the morning session on 23 February 2026, extending their 12-month fall to 72.27%. Today’s price movement coincided with the release of the company’s full-year trading update for the year ended 31 December 2025 (FY2025).

Revenue Growth in Line with Expectations

For the year ended 31 December 2025 (FY2025), AOTI reported a 14% year-on-year increase in revenue to approximately USD 66.5 million, compared with USD 58.4 million in FY2024. The company also expects its Adjusted EBITDA margin for FY2025 to be in line with market consensus, reflecting stable operational performance despite broader pressures in the US healthcare landscape.

Excluding Arizona, group revenue growth stood at around 15% in FY2025, slightly lower than the 19% growth recorded in FY2024, indicating relative resilience across its core markets.

Balance Sheet Shifts and Rising Receivables

At the end of FY2025, net debt stood at approximately USD 6.5 million, compared with a net cash position of USD 0.9 million in FY2024. The shift was primarily driven by increased receivables and a drawdown under the SWK Funding LLC facility.

Receivables linked to Arizona Medicaid rose to USD 15.6 million at year-end FY2025, up from USD 8.2 million in FY2024, as reimbursement denials persisted. Although USD 1.1 million of claims submitted through arbitration have been recovered in full, the process remains complex and resource intensive.

Arizona Medicaid Pressures and Strategic Response

Arizona Medicaid contributed roughly USD 9.2 million in FY2025 revenue; however, ongoing payment denials have prompted the company to cease accepting new Arizona Medicaid patients from 1 April 2026 while resolution efforts continue.

Management noted that operational and commercial restructuring measures introduced during 2025 have now been fully implemented, with early positive indicators emerging. The company also reiterated its expectation of a CMS local coverage determination in the near term, which it believes could support future growth once US healthcare market headwinds begin to ease.

What Investors are Watching?

Arizona Medicaid appears to be a significant near-term concern, particularly given that it contributed approximately USD 9.2 million in FY2025 revenue and drove receivables up to USD 15.6 million, impacting net debt and cash flow visibility. While the broader business delivered 14% revenue growth in FY2025 and met EBITDA margin expectations, reimbursement uncertainty in Arizona has weighed on sentiment.

With the stock down 17.57% on 23 February 2026 and declining 72.27% over the past year, investors seem focused on balance sheet pressures and working capital risks. A resolution on Arizona Medicaid, alongside progress on a CMS coverage determination, could therefore be pivotal in shaping the company’s recovery trajectory

FAQs

  1. How did AOTI perform in FY2025?

AOTI reported 14% revenue growth to approximately USD 66.5 million in FY2025, with Adjusted EBITDA margin expected to be in line with market expectations.

  1. Why did net debt increase in FY2025?

Net debt rose to around USD 6.5 million due to higher receivables—primarily linked to Arizona Medicaid reimbursement delays—and a drawdown under its SWK loan facility.

  1. What is happening with Arizona Medicaid?

Reimbursement denials increased receivables to USD 15.6 million in FY2025. The company will stop treating new Arizona Medicaid patients from 1 April 2026 while pursuing a resolution.